Senators signal tax cut might fly

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March 15, 2012 - 7:00pm

The Legislature signaled today that a tax cut may be part of its budget package. But it's not a done deal.

Up to now, senators opposed to Gov. Dave Heineman's proposal have argued that would leave too little money for future spending needs, like education. Today, Sen. Mike Flood of Norfolk, Speaker of the Legislature, tried to break the logjam. After consulting with the governor, Flood proposed a series of budget cuts, and as a sweetener, spending $10 million from the cash reserve on special education.

Flood said he was trying to make a tax cut work within the framework of the budget. "If you don't want this to work, the question is, what do you want to make work? And are there other ideas?" he asked his fellow senators. "If you're absolutely opposed to having any sort of a tax cut, that's fine too. I can accept that. Make that part of your statement and let's understand where you're at," he added.

Omaha Sen. Steve Lathrop said being for or against tax cuts wasn't the issue. "I like tax cuts. Everybody here does. Right? We're politicians," he said. "We like these just as much as the governor does. Our responsibility, however, as policymakers, is to ensure first that we have a way to pay for them."

As Flood's amendments were debated, many senators who favor the tax cuts argued for increased spending on special education as part of the proposed package. Among them was Sen. Beau McCoy of Omaha, who said needs for special education are increasing. "I know I hear that from the school districts that are in my legislative district. I would imagine that we all do. And I think this provides a way forward in increasing the funding for this," McCoy said.

On the other hand, critics of the tax cut like Omaha Sen. Jeremy Nordquist argued against additional special education spending. Nordquist compared using money from the cash reserve for ongoing spending to buying a new car, and sarcastically suggested the Legislature might be committing itself to more than it could afford. "Who in this body doesn't want to give special education more money? Maybe we should run an amendment to this to make it 20 or 30 million dollars. We all love special ed that much," Nordquist said. "But you know what? I want a new Lexus. But I'm fiscally responsible enough to not take the first month payment out of my savings account to pay for it, and not have the money to make the rest of the monthly payments on my new Lexus. That's what we're doing here," he declared.

In the end, lawmakers voted 25-16 for Flood's proposal to increase special education spending. They adjourned for the day without reaching votes on his proposed spending cuts of $6 million in unused funds for Medicaid, behavioral health, ethanol production and community corrections.

Those cuts, and the tax cut plan, are expected to come up next week.

 

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