Hemp Get Positive Hearing; Property Tax Standoff Continues; Anti-Abortion Language Left Out

Feb. 12, 2019, 5:53 p.m. ·

Assitant Agriculture Director Amelia Breinig testifies Tuesday (Photo by Fred Knapp, NET News)

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A proposal to allow Nebraska farmers to grow hemp got a positive hearing before the Legislature’s Agriculture Committee Tuesday. But debate over a minor property tax proposal suggested how difficult it’ll be to get anything major done on that issue. And the Legislature’s Appropriations Committee voted 5-4 not to put language denying family planning funds to abortion providers in the budget.

When Omaha Sen. Justin Wayne introduced a bill to legalize the production of hemp in the last Legislature, it never even got out of committee. But in the 2018 Farm Bill, Congress removed hemp from the schedule of controlled substances, giving the green light for states to legalize its cultivation.

Hemp is defined as having less than 0.3 percent of THC, the psychoactive ingredient in marijuana. And Wayne says it has the potential to provide an economic boost for the entire state.”This is hemp – a safe product that will provide an alternative crop for our farmers, and for my district, I believe we can move manufacturing facilities into that area because of logistical – the interstates that connect right across the river to make a sound production and grow our economy,” he said.

Supporters said hemp can be used for making everything from medicines containing cannabidiol or cbd oil, to snack food and textiles. University of Nebraska-Kearney economics professor Allan Jenkins said hemp has a long history in Nebraska. “The early homesteaders brought hemp seeds to the state. Enough hemp was grown here that Fremont had a processing plant 120 years ago. During World War II American farmers were encouraged to participate in the ‘Hemp for Victory’ program, needed because the war had stopped the flow of rough fibers from Asia. The ubiquitous ditch weed – all those millions of hemp plants that you drive past as you travel across Nebraska -- are the descendants of those ‘Hemp for Victory’ plants that were last purposefully cultivated in 1944,” he said.

The administration of Gov. Pete Ricketts also had favorable things to say about hemp. Assistant Director of Agriculture Amelia Breinig said “The Nebraska Department of Agriculture supports the 2018 farm bill and supports hemp as a commercial product in the state of Nebraska.”

Breinig testified in an officially neutral position on the bill, saying the department still needs to examine a last-minute amendment brought by supporters and make sure it’s consistent with federal law. No one testified against the bill.

And debate by the full Legislature over a relatively minor property tax bill suggested how difficult it will be to get anything major done on the issue. The proposal by Sen. Tom Briese of Albion would change how agriculture land is valued for tax purposes.

Currently, commercial and residential property is supposed to be assessed at its full market value, while ag land is assessed at 75 percent of its market value. Briese proposed to drop that to 30 percent – but only for purposes of school bond issues.

He gave the example of taxes to pay off a million dollars a year on a bond issue in a mostly rural district. Right now, the owner of a $150,000 house pays $94, while the owner of a 900 acre farm pays $2,531. The proposal would raise the homeowner’s bill to $180, and reduce the farmer’s to $1,944.

Briese defended that shift in the tax burden. “The burden has already shifted to ag in the last decade or so. Ag real estate taxes over the last decade have increased over 150 percent; the average residential property tax bill has increased about 30 percent,” he said.

Omaha Sen. Steve Lathrop said the shift would make it more difficult to pass bond issues in rural areas. And he said it ignores a much larger problem. “The things that they want to do that you are troubled by, and that they are voting for as bond issues in your districts may be good ideas. But we don’t have that conversation because we have starved the beast. And the beast is what the state is going to spend on education,” he said.

Gov. Pete Ricketts’s budget calls for spending $1.1 billion – nearly an 11 percent increase – in state aid to schools. That’s all the money called for by the formula created by the Tax Equity and Educational Opportunity Support Act, or TEEOSA.

But over half the school districts in the state receive no help from TEEOSA – largely rural districts, with high property values on farmland. And Lathrop said his suburban Omaha districts are also underfunded, having to ask voters to override property tax limits to run their schools.

After about an hour and a half of debate, Briese asked for his bill to be put on hold, meaning it won’t come up again unless he says he has a filibuster-proof majority behind it.

Tuesday afternoon, the Education Committee heard a proposal to abolish TEEOSA by Sen. Curt Friesen of Henderson. Friesen explained his reasoning in an interview before the hearing. “Everybody keeps saying that the TEEOSA formula is broken. I will disagree with that to some extent, but if it is broken, let’s get rid of it. Let’s start something new. And without putting a deadline in place where this one goes away, we’ll never get anything else built,” he said.

Friesen’s proposal would simply abolish TEEOSA in 2022, eliminating about one-third of the total funding for Nebraska schools. The senator acknowledged his proposal doesn’t have much of a chance. But he said it would prompt some needed discussion.

That discussion is scheduled to continue, with other property tax and school funding bills coming up for public hearings. But whether any significant change will be approved remains uncertain.

And on the abortion language, Appropriations Committee Chairman Sen. John Stinner said the committee decided not to put language restricting Title Ten family planning funds in the budget. That language passed last year was widely seen as an attempt to cut funding for Planned Parenthood. Stinner said he expects there to be a fight to insert the language when the budget gets to the full Legislature.