Governor prioritizes tax relief

Saying tax relief for middle-class Nebraskans should be the state’s top priority, Gov. Dave Heineman delivered his annual State of the State address to lawmakers Jan. 12.

The governor began by thanking several senators who are beginning their last session due to term limits, including Speaker Mike Flood of Norfolk.

“Individually and as a group, you’ve done an outstanding job and Nebraskans appreciate your service,” Heineman said. “I’m proud of the Legislature and what we’ve accomplished together.”

The governor praised past efforts to put Nebraska in a strong financial position and make the state economically competitive. Heineman cited the Nebraska Advantage program and other tax reforms as important incentives to businesses and families to locate in Nebraska.

“Working with our citizens, we have developed a bold, innovative and strategic vision to grow our economy and to strengthen our education system,” he said.

As a result, Heineman said, Nebraska’s net tax receipts grew by $349 million in 2011. Lawmakers should use that revenue to provide tax relief to Nebraskans, he said.

The governor said he would propose a major tax relief initiative this session. Among the provisions included in the package are reductions in the state’s corporate and individual income taxes and elimination of the inheritance tax.

“Our hard-working, middle class taxpayers need more discretionary income to take care of their families and to provide their kids with a good education,” Heineman said.

Among future challenges outlined by the governor was ongoing reform of the state’s child welfare system. Heineman said senators and other stakeholders must work together to develop a more collaborative and coordinated approach to serving the state’s vulnerable children and families.

“Together, we need to bring stability to Nebraska’s child welfare system,” he said. “The focus should be on the future and on measurable results.”

Heineman also said the state should move forward with the planning and design of a state health insurance exchange in spite of uncertainty over the future of federal health care reform.

“I want to assure you and our citizens that Nebraska will not default to the federal government regarding a health insurance exchange,” he said.

Finally, the governor proposed merging the state Department of Labor into the Department of Economic Development. The merger would provide a more coordinated effort at job creation and worker training and retention, he said.

Heineman said Nebraska is in an excellent economic position relative to other states and should continue to build on past successes.

“This is about our future,” he said. “Together we can make it happen.”