Looking Ahead to the 2024 Legislative Session
The second session of the 108th Nebraska Legislature will convene January 3rd, 2024. The 2024 session is a 60-day “short session.” Legislative activity will proceed at full speed, with much to accomplish right from the start. Following an anticipated rules debate, senators will begin debating the many carryover priority bills from the 2023 session.
This will be the final legislative session for 13 term-limited senators – what will they be able to add to their legacy? Like 2023, it is anticipated that priority designations will be the key to getting bills across the finish line in these short, fast-moving 60 days.
Our team has been gearing up for the 2024 session with the intention of continuing the momentous legislative accomplishments achieved in 2023. We’ll be working with legislators, their staff, and other policy influencers in support of advancing bills promoting the “Good Life.”
Despite the large number of carryover bills from 2023, we know that in the first 10 days of session, hundreds of new bills will be introduced. We’ve been talking to senators and other stakeholders throughout the interim about issues they’d like to tackle in 2024, and there’s no doubt we’ll be tracking some new bills that pique our interest. As we await new bills to get officially introduced, let’s look at carryover bills we feel deserve to see forward momentum in 2024.
Removing Workforce Barriers and Promoting Entrepreneurship: Nebraska has some of the highest workforce licensing requirements in the country making it difficult for licensed professionals who move here from other states to be able to readily enter the workforce. Additionally, those with histories of criminal offenses often have a difficult time finding employment after incarceration.
LB16 is a solution to these issues, and it sits on General File. This bill would allow for “universal recognition” for those in licensed occupations from another state who have work experience and have maintained their license in good standing when they move to Nebraska. LB16 also would require licensing boards to define specific felonies which would exclude someone from licensure in Nebraska.
Also sitting on General File is LB321, a bill to expand upon Nebraska’s current cottage food law. Current law allows only for the sale of shelf-stable homemade baked goods from one’s home kitchen. Many cottage food producers want to expand the types of baked goods they can sell, and LB321 expands current law to include cream-filled baked goods like what neighbor states Iowa, South Dakota, and Wyoming allow. The number of registered cottage foods producers has quadrupled since the 2019 law was passed. LB321 provides an opportunity for them to grow their businesses.
Continued Tax Relief for Economic Competitiveness: The historic tax reforms passed in 2023 brought Nebraska more in line with neighboring states. While these reforms improved our tax rankings nationally, there are opportunities for reforms that could improve our rankings even more.
Nebraska’s inheritance tax law was updated to increase exemptions and reduce tax rates, yet we remain an outlier, being one of only five states in the country that levy this tax. Full repeal is needed. LR23CA is a carryover bill from 2023 to allow the citizens of Nebraska to decide whether Nebraska should eliminate this burdensome tax. We hope to see the revenue committee include elimination of the inheritance tax in their 2024 tax package.
While legislators made strides in reducing corporate income taxation, there are additional ways to make Nebraska more business friendly from a tax standpoint. Adopting permanent full expensing of investments in machinery and equipment in the year the costs are incurred as proposed in LB492 would provide even greater tax relief for Nebraska businesses. Also, Nebraska could improve upon its tax treatment of remote workers by allowing a 15-30 day threshold before requiring tax returns and withholding to be filed as well as eliminate its “convenience of employer” rule. Carryover bills LB173 and LB416 addressed remote workers and piqued the interest of revenue committee members. We anticipate a desire to make Nebraska even more business tax friendly in 2024.
Additionally, another year of Truth in Taxation hearings highlighted more ways the law could be improved. We will support measures to strengthen the Truth in Taxation process such as only allowing for “real growth” and eliminating the 2% “allowable growth” on top of it, as well as providing property owners with earlier notification that their taxes will be raised and when joint public hearings will be held.
Balance of Power: Legislatures across the country pass reforms every year that are well intended, but agencies may write ambiguous regulations that undermine the intent of those reforms. Regulations can impact business owners and citizens in ways that compel them to seek litigation. In Nebraska, the courts oftentimes defer to state regulatory agencies for their interpretation of statutes. LB43 would require state courts to interpret regulations in favor of a reasonable interpretation which limits agency power and maximizes individual liberty.
While this is commentary on only a handful of bills, we’ll continue to keep you updated on both carryover and new legislation that we feel reduces barriers to prosperity in the new year.