After concerns from rural senators, bill that would enhance TIF use in low-income areas stalls

LINCOLN — State Sen. Justin Wayne’s effort to increase the use of an economic development tool, tax-increment financing, in low-income areas within his north Omaha district and elsewhere was derailed, at least temporarily, on Tuesday.

His proposed constitutional amendment, Legislative Resolution 14CA, ran into a wave of questions and concerns from rural senators about TIF and whether future legislators would maintain — or pervert — the goals sought by Wayne.

After not getting to a vote to advance LR 14CA after three hours of sometimes heated debate on Monday and Tuesday, lawmakers moved on to other issues. The proposal could be brought up again later in the session, but it was unclear Tuesday whether that would happen.

Wayne expressed frustration after debate ended and said it may affect his support for property tax relief measures, which are a top priority of rural senators.

Under LR 14CA — which would require voter approval in 2020 — cities could pledge up to 20 years of the increased property taxes generated by a new development to costs associated with the project. At least half of the projects would have to be in an area declared as “extremely blighted” to qualify.

Currently, TIF projects have a limit of no more than 15 years, and Wayne said it was unfair for projects at 72nd and Dodge Streets in Omaha to get the same benefits as areas with high unemployment that need new development.

But opponents, led by Sen. Mike Groene of North Platte, complained that the proposed constitutional amendment didn’t include a definition of “extremely blighted” and that future lawmakers could change “willy nilly” the intent of Wayne’s proposal. Groene, a longtime critic of tax-increment financing, argued that TIF is a property tax giveaway for new developments that would happen anyway.

“I don’t trust the economic gurus from the municipalities,” Groene said.

Wayne took exception to the criticism from Groene and others, saying it showed they didn’t care about his community.

He said that the concerns about “future legislatures” changing the intent of his proposed constitutional amendment were bogus and could be said of every bill passed by lawmakers. Wayne added that he trusted future lawmakers to “do something great” for the state, and, if necessary, adjust TIF to reflect changing conditions.

During the debate, the Omaha senator also hinted that “a split” was opening between urban and rural senators. Wayne said the opposition to his proposal has him rethinking support for bills “for your community, including property tax relief,” an obvious reference to rural communities.

Payment rates. Kelli Blacketer depends on others for much of what she does each day.

They help her get out of bed, use the bathroom, get dressed and eat her meals. They help her communicate with a letter board or special technology. They serve as her eyes when she’s steering her wheelchair. They help her write and create art.

That’s why Blacketer appeared Tuesday before the Appropriations Committee to urge support for a pair of bills aimed at increasing payment rates for providers of services for developmentally disabled people.

She was the first of several who testified in favor of Legislative Bill 558, introduced by State Sen. Robert Hilkemann of Omaha, and LB 202, introduced by Sen. Anna Wishart of Lincoln.

Hilkemann’s bill would raise payment rates for developmental disability services to the level recommended in a recent rate study undertaken by the Department of Health and Human Services. The bill would boost funding by $22.3 million a year, of which $10.3 million would come from state funds.

Wishart’s bill would make a final $2.6 million payment to providers for certain services rendered in fiscal year 2016-17. The federal government refused to pay for the services, citing errors in the state’s billing. The state has since reimbursed providers for most, but not all, of that care.

Alan Zavodny, chief executive officer for NorthStar Services, a service provider based in Wayne, Nebraska, said the proposed rate increases are desperately needed. The last change in rates was based on a 2011 study.

He said his agency employs about half the number of people it did five or six years ago, the result of coping with flat rates and rising costs. Those employees have not gotten raises for several years, while rising health insurance costs eat away at their take-home pay.

“Please believe me when I say there is no more money and no more services to cut,” Zavodny said.

No one testified in opposition to the two bills, which were heard along with a proposal to increase payment rates to mental health and substance abuse providers. LB 327 would require the state to pay providers the same rates under Medicaid and probation that they are being paid through the HHS behavioral health division.

Fence for Kearney center. A fence appears to be on its way to the Youth Rehabilitation and Treatment Center in Kearney, from the budget of the Department of Health and Human Services.

HHS has received a bid of $704,500 to build a fence around the main part of the center’s campus. Officials said they plan to use existing funds.

But Sen. John Lowe of Kearney asked the Appropriations Committee for $2 million for a fence on Tuesday. He told The World-Herald that LB 485 is “insurance,” in case the bid to HHS falls through.

He argued that a fence is needed to prevent escapes and protect Kearney citizens. Lowe noted that a youth who escaped last month is still missing. Most Kearney residents strongly support a fence, he said. Many receive text alerts whenever a juvenile escapes.

The Kearney center is the only state-run facility for teenage male juvenile offenders. The equivalent for girls is in Geneva.

Earlier in the day, the committee heard testimony about LB 227, introduced by Sen. Dan Quick of Grand Island, which asked that money instead be invested inside the center. It asks for $3.9 million a year to pay for hiring and training staff in both the Kearney and Geneva centers.

“I believe there are better ways (than a fence) to accomplish the goal of balancing the concerns of safety for our youth and staff by reducing the number of youth who leave the facility and retaining the noninstitutional nature of the center,” Quick said.

His bill would require more evidence-based mental and behavioral health programs, programs preparing juveniles to leave the center and an independent review from a university.

LB 227 “would accomplish the same purpose” as a fence, said Juliet Summers of Voices for Children of Nebraska. “We know what young people respond to, even significantly troubled young people. They respond to strong relationships with positive results.”

The Kearney youth center has seen improvements in recent years, said Julie Rogers, the inspector general of Nebraska child welfare. Four youths escaped in 2018, down from 17 in 2017 and 40 in 2016, according to Rogers. But there have been 10 escapes so far this year.

“Dumb” Facebook posts. A legislative committee rescinded its recommendation to confirm a North Platte firefighter to the State Emergency Response Commission on Tuesday because of social media posts described by the committee chairman as “dumb” and showing “bad judgment.”

State Sen. Tom Brewer of Gordon, who heads the Government, Military and Veterans Affairs Committee, said there are consequences for things posted or shared on social media, and the committee’s decision on Trent Kleinow, an assistant fire chief nominated by Gov. Pete Ricketts, was an example.

Eight Facebook posts “shared” by Kleinow that were obtained by The World-Herald depicted obscene gestures, as well as posts disparaging Latinos, Muslims, former first lady Michele Obama and other women.

Kleinow, when contacted Tuesday, declined to comment. The committee had initially recommended his appointment, but after the Facebook posts became known, members reversed course on Tuesday.

A spokesman for the governor, Taylor Gage, said that his office was not aware of the posts when Kleinow was appointed, but when made aware of them, Kleinow was asked to withdraw. The governor supports the committee’s decision, Gage said.

The Emergency Response Commission coordinates planning and response to risks from hazardous chemicals.

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