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The Nebraska Legislature on Thursday gave first-phase approval to another state budget, but not before nearly half of the senators voiced their concerns about parts of the bill.
Thursday’s debate focused on a bill that would transfer money between different state funds to balance the budget and pay for property tax cuts. The biggest part of the bill was a proposal to transfer $70 million from the Unemployment Insurance Trust Fund to the General Fund.
Supporters of the move argue that the state’s unemployment fund is just a backup of the federal trust fund, from which no money has been disbursed in the past five years. Gov. Jim Pillen recommended a $60 million transfer, and the Appropriations Committee increased that recommendation to $70 million. Sen. Rob Clements said there would still be $12 million in the fund after the transfer.
Sen. Daniel Conrad criticized the idea, offering an amendment to cancel the proposed transfer.
“There’s no policy in raising $70 million for this fund. It’s a raid for the sake of raiding. It’s a big-ticket item that helps free up money for other purposes. And that’s not what the trust fund is for,” Conrad said. he said.
Sen. Brad von Gillern opposed using the money that businesses pay into the Unemployment Insurance Trust Fund for other purposes.
“As an employer, I have been paying money into this fund for 30 years, so it is for a very specific purpose and reason that we paid money into that fund and we are doing something with that money. If we know it was meant to be different, I think at least he’s getting closer to it.”That’s an advantage we don’t want to get close to,” von Gillen said.
Sen. Cristi Armendariz, a member of the Appropriations Committee, urged senators to support the transfer.
“What I would suggest is that we don’t change course and do what the Appropriations Committee has recommended. Frankly, I think previous members of Congress should have realized. Previous Appropriations Committees. should have realized this and abolished the fees and taxes imposed on these companies a long time ago,” Armendariz said.
Sen. Steve Erdman supported the idea and the move.
“We have companies donate to this fund, which has been unused for years and the fund continues to grow. It makes sense to give back to people,” Erdman said.
Sen. Mike Jacobson also downplayed concerns that transferring money from the fund could strain the state’s money if the economy worsens and unemployment claims increase.
“We had about $1 billion in reserves, so we never run out of money. If there’s a recession, we have reserves,” Jacobson said.
When it came time to vote on the Conrad amendment, the senators were evenly divided, with 20 in favor and 20 against. The amendment failed because 25 votes were needed to approve it. However, five senators voted, and four were absent. Conrad said this points to the transfer issue and how much the final amount will be still up in the air.
“I think everyone can see the writing on the wall. If you look at that vote, given that there were multiple supporters who were absent at that time for various professional and personal reasons. There is no doubt that there is physical discomfort in proceeding with this proposal as written,” she said. she said.
Conrad said he was confident there would be further negotiations on transfers and other budget issues.
One of the changes lawmakers made was to alter a proposal to transfer interest earned in the Universal Service Fund, which is meant to subsidize expensive telecommunications services.
Governor Pillen originally proposed transferring $13 million to the general fund for the current fiscal year and next fiscal year. Clements said the $13 million is based on an estimate of interest accrued in the fund over the past 10 years. However, because that interest had been converted to principal, and there were legal arguments that the fund’s principal could not be transferred, the Appropriations Committee reduced the transfer amount to $1.2 million, continuing indefinitely into the future. I suggested that.
An amendment proposed by Sen. Makaela Kavanaugh would only extend the transfer next year, after which Congress would have to decide whether to continue.
Sen. Wendy DeBoer supported Kavanaugh’s amendment, saying it would require money from the Universal Service Fund to maintain the telecommunications infrastructure currently being expanded.
“Right now we are developing at a very fast pace. The head of the Broadband Authority, Nebraska Broadband Authority, told our committee that by 2029 we will be built. I hope he’s right. I can’t imagine we’ll be able to build that quickly, but at least we’ll get quite far. I mean, in very rural areas, there’s a lot of fiber underground that needs to be maintained. That means there are reserves,” DeBoer said.
Senators voted 30-12 in favor of Kavanaugh’s amendment. They then voted 37-5 to move forward with the entire funding transfer bill as work continues on changes to the state budget and taxes.
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