The Legislature adjourned at noon following contentious debate on LB 415. Debate on the bill began last Thursday and lasted for the vast majority of floor debate throughout the week. LB 415, introduced by Senator Beau Ballard (Lincoln), has been labeled the "clean-up bill" for the Nebraska Healthy Families and Workplaces Act, also known as Initiative 436 or the Paid Sick Leave Ballot Initiative. However, the Business and Labor Committee advanced LB 415 with a committee amendment that combines the bill with LB 698, introduced by Senator Paul Strommen (Sidney). As combined, the bill would do the following: (a) Exempt businesses with 10 or fewer employees from being required to comply with the Act: (b) Exempt owners, independent contractors, temporary and seasonal agricultural workers, and employees under 16 years old from accruing paid sick time, or counting towards the number of employees; (c) Provides a method for providing paid sick leave to employees who are paid by commission, mileage, or fee-for-service rather than hourly; (d) Clarifies that existing vacation time and paid time off programs could be used as sick leave under the Act; (e) Provides that employees do not begin accruing paid sick time until after 80 hours of consecutive employment rather than immediately; (f) Provides that paid sick time provided to an employee on or after January 1, 2025, and before October 1, 2025, shall be counted toward an employer's obligations under the Act for calendar year 2025; (g) Clarifies that an employer is not required to pay an employee for unused paid sick time upon the employee's separation from employment; and (h) Provides additional flexibility for employers to direct how requests for paid sick leave should be made. After a Motion to Invoke Cloture, the bill advanced to Select File on a vote of 34-15.

This week also marks the last week of committee hearings. Most committees wrapped up hearings last week, with only a handful of committees meeting this week. The Judiciary Committee was the only regular committee to still consider bills this afternoon.

All-day floor debate will begin on Monday with Senators taking up floor debate on Senator priority bills. Overall, there are 106 priority bills, which means it is unlikely that all will get heard on the floor of the Legislature.

The Nebraska Legislature adjourned yesterday to begin a four-day weekend for the Senators. This week marked the halfway point for the 109th Legislature's First Session. Next week is the final week of committee hearings, though most committees have already completed their hearings for the year. After that, the Legislature will begin all-day floor debate with the focus on bills that have received a priority designation.

Debate began Thursday on LB 415, introduced by Senator Beau Ballard (Lincoln). LB 415 has been labeled the "clean-up bill" for the Nebraska Healthy Families and Workplaces Act, also known as Initiative 426 or the Paid Sick Leave Ballot Initiative. However, the Business and Labor Committee advanced LB 415 with a committee amendment that combines the bill with LB 698, introduced by Senator Paul Strommen (Sidney). As combined, the bill would do the following: (a) exempt businesses with 10 or fewer employees from being required to comply with the Act; (b) exempt owners, independent contractors, temporary and seasonal agricultural workers, and employees under 16 years old from accruing paid sick time, or counting towards the number of employees; (c) provides a method for providing paid sick leave to employees who are paid by commission, mileage, or fee-for-service rather than hourly; (d) clarifies that existing vacation time and paid time off programs could be used as sick leave under the Act; (e) provides that employees do not begin accruing paid sick leave until after 80 hours of consecutive employment rather than immediately; (f) provides that paid sick time provided to an employee on or after January 1, 2025, and before October 1, 2025, shall be counted toward an employer's obligations under the Act for calendar year 2025; (g) clarifies that an employer is not required to pay an employee for unused paid sick time upon the employee's separation from employment; and (h) provides additional flexibility for employers to direct how requests for paid sick leave should be made. The bill is currently undergoing a filibuster, which is expected to resume on Tuesday.

The Banking, Commerce and Insurance Committee held its final hearing on Monday, which included LB 686 and LB 687.

LB 686 - Prohibit Government Entities and Officials from Keeping Certain Lists Relating to the Ownership of Firearms and Prohibit Using Merchant Category Codes to Distinguish Firearm Retailers
Introduced by Senator Dan Lonowski (Hastings), LB 686 would prohibit: (a) government entity, official, agent, or employee of a government entity or official to knowingly keep or cause to be kept any list, record, or registry of privately owned firearms or the owners of firearms, except for those records kept during the regular course of criminal investigation, prosecution, or otherwise required by law; (b) payment card network to require or incentivize the use of a merchant category code in a manner that distinguishes a firearm retailer from other retailers; and (c) the covered entity from assigning a firearm retailer, a merchant category code that distinguishes the firearm retailer from other retailers. Firearm retailer is defined as any person or entity that is engaged in the lawful selling or trading of firearms or ammunition. Merchant category code is defined as the code, approved by the International Organization for Standardization that is assigned to a retailer based on the type of goods and services offered to retailers' customers. The law would be enforced by the Attorney General, who would have the authority to seek injunctive relief and civil fines. Lastly, the bill would provide that it shall be a defense to a proceeding initiated pursuant to this bill that a merchant category code was required to be permitted or assigned by law. (NBA Position: Oppose)

LB 687 - Adopt the Firearm Industry Nondiscrimination Act
Also introduced by Senator Lonowski, LB 687 would adopt the Firearm Industry Nondiscrimination Act, which would prohibit governmental entities from entering into a contract with any company engaged in the discrimination of firearm entities for contracts of at least $100,000 that are to be paid in whole or in part by a governmental entity. Discrimination is defined as refusing to engage in business with, refraining from continuing with existing business relationship with, or terminating an existing business relationship with an entity or association based on its status as a firearm entity or Firearm Trade Association. Discrimination also would not include such a company's refusal to engage in business due to any traditional business reason that is specific to customer or potential customer and not based solely on the status as a firearm entity or Firearm Trade Association. (NBA Position: Oppose)

Nick Vrba of RVR Bank in Fremont testified on behalf of the NBA in opposition to LB 687. In his testimony, he stated: "Banks should be free to lend to, invest in, and generally do business with any entity or activity that is legal, without government interference. Banks should be free not to lend, invest, or otherwise engage so long as they do not violate statutory, regulatory, fair lending or other anti-discrimination laws. Banks know who they should and should not lend to."

Monday will mark day 45, the halfway mark of the 90-day session. Speaker Arch set today as the deadline for all individual and committee priority bill designations. Each Senator is allowed to designate one bill as a priority bill. Additionally, each of the 14 standing committees is entitled to designate two priority bills. A full list of designated priority bills may be found here.

The Banking, Commerce and Insurance Committee designated LB 198, introduced by Senator Tony Sorrentino (Elkhorn), which would enact pharmacy benefit manager (PBM) reform, as well as LB 474, introduced by the Committee, which represents a Nebraska Department of Banking and Finance omnibus bill. The NBA anticipates that LB 232, as amended, will be included as part of the Committee package. LB 232, introduced by Senator Bob Hallstrom (Syracuse) on behalf of the NBA, as amended, would require all life insurance policies issued in Nebraska that are assigned as collateral for a loan to include a provision requiring that notice be provided to the assignee prior to lapse or termination for nonpayment of premium. It would also clarify that assignees have the same legal standing as the policy owner to enforce the notice provisions. LB 232 was advanced from the Committee on February 11 on an 8-0 vote.

Additionally, LB 241 passed on Final Reading on Thursday and was presented to Governor Jim Pillen for his signature. The bill, introduced by Senator Hallstrom on behalf of the NBA, would provide a definition for a cybersecurity event for the unauthorized access to or disruption of information systems of private entities. It would further require that in order to maintain a class action lawsuit against a private entity for such an event, a person would need to demonstrate the cybersecurity event was the result of willful, wanton, or gross negligence on the part of the private entity. LB 241 creates a heightened standard for class action lawsuits and is aimed at curbing class action lawsuits where customers face no actual monetary loss.

March 14: Deadline for designation of committee and senator priority bills
March 17: Speaker priority bills announced
March 28: Last day of public hearings
March 31: Full day floor debate begins
June 9: Day 90 of the legislative session

This week was a relatively quiet week for floor debate in the Unicameral. Senators advanced a number of bills from General File to Select File and ended the week with Final Reading, advancing 19 bills, including LB 609, introduced by Senator Eliot Bostar (Lincoln). LB 609 would adopt the Controllable Electronic Record Fraud Prevention Act to require registration and licensure of cryptocurrency kiosks. The bill would also enact consumer protection measures for gift cards and prepaid cards for businesses, other than financial institutions. In what seemed like déjà vu, the Legislature adjourned during a filibuster on LB 229, introduced by Senator Bob Hallstrom (Syracuse). The bill clarifies that "network contractors working for marketplace network platforms" (e.g. Uber and Lyft) are independent contractors, rather than employees. Earlier this year, LB 229 was the first bill to be filibustered to the point of requiring a Motion to Invoke Cloture. The Legislature will continue where it left off with Final Reading on LB 229 on Monday.

Coming into the session, there was a projected budget shortfall of $432 million. Fortunately, the Nebraska Economic Forecasting Advisory Board met again on February 28 and revised the forecast, shrinking the shortfall to approximately $198.8 million. This is in large part due to a projected increase in corporate income tax receipts. However, the budget took a hit when Senator Rob Clements (Elmwood) announced on Thursday that the federal government is again planning to decrease its contribution to state Medicaid costs, resulting in Nebraska being on the hook for an additional $90.3 million this budget cycle.

The following bills of interest were heard in committee this week:
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LB 254 - Funding for Rural Workforce Housing
Introduced by Senator Hallstrom, LB 254 would transfer $25 million from the General Fund for FY 2025-26 to the Rural Workforce Housing Investment Fund and an additional $25 million for FY 2026-27. (NBA Position: Support)

LB 651 - Amend Nebraska Medical Cannabis Regulation Act and Provide Regulations
Introduced by Senator Danielle Conrad (Lincoln), LB 651 would prohibit a qualified patient or registered caregiver to be subject to citation, arrest, prosecution, or penalty in any manner, or denied any right or privilege, including, but not limited to, civil penalty or disciplinary action by a court or occupational or professional licensing board for acting as prescribed in the legislation. The bill would also prohibit smoking or inhaling cannabis by vaporization, in addition to other locations, a public place or place of employment, other than with an aerosol inhaler. Nothing in Act: (1) requires employer to permit/accommodate growing, possession, consumption, use, distribution, display, transfer, transportation, or sale of cannabis; (2) effects ability of employer to restrict use of cannabis by employees; (3) requires employer to accommodate the use of cannabis; or (4) requires medical assistance program, employer, or insurance carrier pursuant to the Workers' Compensation Act to reimburse person for costs associated with medical use of cannabis. Nothing in act shall be construed to: (1) prohibit employers from prohibiting the use of cannabis; (2) permit cause of action against employer for wrongful discharge or discrimination; (3) prohibit person, employer, corporation, or other entity which occupies, owns or controls property from prohibiting or otherwise regulating growing, possession, consumption, etc. on or in the property, or (4) prohibit employer from establishing and enforcing drug testing policy, drug-free workplace policy, or zero-tolerance from drug policy. Any employee discharge from employment for identified related cannabis consumption or testing positive for controlled substance shall be disqualified from unemployment benefits. Finally, the bill would amend Nebraska Medical Cannabis Regulation Act which, among other items, authorizes financial institution to loan money to, accept deposits from, and otherwise do business with any licensee as defined in the act to the same extent as other persons, subject to restrictions in the Act. (NBA Position: Watch)

LB 677 - Amend Nebraska Medical Cannabis Regulation Act and Provide Regulations
Introduced by Senator Ben Hansen (Blair), LB 677 would authorize financial institution to loan money to, accept deposits from, and do business with any licensee, subject to restrictions of the Nebraska Medical Cannabis Regulation Act, and would define financial institution. (NBA Position: Watch)

The following bills of interest are scheduled to be heard in committee next week:

LB 169 - Change Sales and Use Tax Exemptions
Introduced by Senator Tom Brandt (Plymouth), LB 169 would impose sales tax on specialty animal services and veterinary services, create new sales taxes for telephone conference bridging services, interstate telecommunication services, animal grooming performed by a licensed veterinarian or a licensed veterinarian technician, chartered flights, cleaning of clothing, dating services, hair care and hair removal services, except for the cutting of hair, interior design and decorating services, lobbying services, local passenger transportation by charter road vehicles, including limousines and similar luxury vehicles, marketing and telemarketing services, massage services, nail care services, personal instruction services for dance, golf, or tennis, sightseeing services by ground vehicles, skin care services, swimming pool cleaning and maintenance services, tattoo and body modification services, tele-floral delivery services, travel agency services, and weight loss services, mechanical amusement devices and operation of mechanical amusement devices. (NBA Position: Watch)

LB 170 - Impose Sales Tax on Candy and Soft Drinks
Also introduced by Senator Brandt, LB 170 would impose sales tax on candy and sweetened beverages, which would include granola bars and sports drinks. (NBA Position: Watch)

LB 171 - Increase Individual and Corporate Income Tax Rates
Also introduced by Senator Brandt, LB 171 would eliminate the 3.99% individual and corporate income tax rates beginning January 1, 2026, and make 4.99% the lowest individual income and corporate tax rate. (NBA Position: Watch)

LB 487 - Adopt the Restitution and Redress for Redlining Task Force Act
Introduced by Senator Terrell McKinney (Omaha), LB 487 would adopt the Restitution and Redress for Redlining Task Force Act. After the scrubbing of history of state laws and policies that in 1935 Omaha Homeowner Loan Corporation created mapping for range of high-risk to low-risk loans, resulting in neighborhoods in Omaha being systematically segregated and such discriminatory policy being adopted and sanctioned by Nebraska. Nebraska has continued to perpetuate, condone, and often profit from practices that continued to disadvantage Nebraskans, including the unjust generational wealth gap, unequal education, substandard housing, loss of property, and decreased property value. The bill would also create a task force to: study and develop reparation proposals resulting from redlining practices, lingering negative effects of redlining and discrimination, the manner in which instructional resources and technologies are being used to deny legal, economic, educational, and societal harms of redlining and crimes against Nebraskans that live in cities of metropolitan classes, and the ways in which societal institutions, public and private, higher education, corporate, religious, and associational institutions benefited directly from redlining; recommend appropriate ways to educate the public of task force's findings; recommend appropriate remedies in consideration of the task force's findings; and electronically submit a report to the Legislature. Additionally, the bill would establish a task force consisting of seven voting members: two from the Commission on African American Affairs; three from the second congressional districts; one from the first congressional district; and one from the third congressional district. Finally, the bill would, from effective date of act until November 1, 2028, receive all proceeds from taxes collected from Nebraska's Marijuana and Controlled Substance Tax Act. (NBA Position: Neutral)

March 14: Deadline for designation of committee and senator priority bills
March 17: Speaker priority bills announced
March 28: Last day of public hearings
March 31: Full day floor debate begins
June 9: Day 90 of the legislative session