May 23, 2025

109th Legislature, 1st Session

Governor Pillen's Budget Veto Invalid

Governor Pillen issued several line-item vetoes to LB 261 and LB 264, the primary biennial budget bills. However, due to an apparent mix-up, the bills were not properly returned to the Clerk of the Legislature, as required by the Nebraska Constitution. The vetoes included $11.99 million in funding to the Nebraska Supreme Court, $2 million from public health departments, $511,972 from the State Fire Marshal for salary and health insurance premium increases, and $18 million on spending on Lake McConaughy. As it stands, the Nebraska Legislature has rejected the vetoes. Although rumors and speculation are being discussed in the halls of the Capitol, it is unclear exactly what happened or why. Shortly before adjournment yesterday, Speaker Arch read the following communication to Governor Pillen into the record:

The facts, at present, are as follows: On May 15, 2025, LB261e and LB264e were passed by the Legislature and delivered to the aGovernor on the same date. The bills were signed by the Governor on May 21, 2025, with the inclusion of line-item vetoes. The signed bills were delivered to the Secretary of State on May 21, 2025. On May 22, 2025, at 12:01 a.m., the signed bills were in the possession of the Secretary of State. The morning of May 22, 2025, the bills were returned to the Legislature, signed by the Governor, and a receipt stamp from the Secretary of State indicating the bills were received on May 21, 2025. In light of the aforementioned considerations, the Legislature is hereby remitting these bills to the Governor's Office pending further determination regarding the constitutionality of the present circumstances.

Priority Bills Fail to Advance

The Nebraska Legislature continued to work through priority bills after advancing the budget last week. However, a number of significant bills failed to advance or overcome filibusters. Last week, Governor Pillen made his first veto of the session with LB 319, introduced by Senator Victor Rountree (Bellevue). LB 319 would have ended the lifetime ban for certain individuals with drug-related convictions from receiving Supplemental Nutrition Assistance Program (SNAP) benefits. On Monday, the Legislature took up Senator Rountree's motion to override the veto. Although the bill passed on Final Reading on a vote of 32-17, the motion to override the Governor failed on a vote of 24-24, with one senator present and not voting.

Later that evening, the Legislature voted on a motion to invoke cloture and cease debate on LB 170. LB 170, introduced by Senator Tom Brandt (Plymouth), was one of the major revenue packages for the session. With the pending amendment, LB 170 would include LB 169 and additional sin taxes. The bill would have imposed new sales taxes on 18 so-called "luxury" items, soda and candy, and increased existing taxes on cigarettes, nicotine and vape products. The measure was projected to add $100 million per year to existing property tax relief funds. However, in the face of strong bipartisan opposition, the sponsor attempted to limit the bill to solely increase the cigarette, nicotine and vape product taxes. However, even the largely pared-down version still failed to garner the necessary 33 votes to invoke cloture and end debate.

On Tuesday, the Legislature took up LB 677, introduced by Senator Ben Hansen (Blair). LB 677 was meant to add substance, "guardrails" and a number of other technical and substantive changes to the medical cannabis ballot initiatives that were passed during the November 2024 General Election. The bill was designated as a General Affairs Committee priority bill and was set to restructure the Nebraska Liquor Control Commission to, in large part, act as the Medical Cannabis Commission. However, the committee became deadlocked over what medical conditions should be included for medical marijuana use, and whether patients should be able to smoke or "vape" medical marijuana. The committee finally advanced the bill in late April. Proponents of LB 677 have argued that failing to act would result in a "wild west" with no real regulation, as the ballot initiative was self-enacting. However, the bill faced stiff opposition from opponents of medical cannabis, and ultimately, the bill failed to overcome the filibuster. The motion to invoke cloture filed by Senator Hansen failed on a vote of 23-22. In the meantime, Governor Pillen has changed course and decided to move forward with promulgating regulations related to the Nebraska Medical Cannabis Regulation Act.

Minimum Wage Reform Future Uncertain

Last week, the Nebraska Legislature took a Final Reading vote on LB 258, introduced by Senator Jane Raybould (Lincoln). LB 258 would amend the voter-approved minimum wage law to create a youth and training wage and cap the annual increase at 1.75%. Under current law, the minimum wage is set to increase to $15.00 per hour on January 1, 2026, and increase annually thereafter by the Consumer Price Index for all Urban Consumers (CPI-U) for the Midwest Region. Upon realizing one of the proponents of LB 258 was absent, opponents of the bill quickly halted the filibuster and moved to a final vote in the proponent's absence. Ultimately, the bill failed to advance on a vote of 31-17, with Senator Ballard present and not voting. By doing so, Senator Ballard was able to file a motion to reconsider the final vote. Because the bill would amend a ballot initiative, it needs 33 votes to pass.

The Legislature took up the motion to reconsider on Thursday morning during another heated and personal debate. Senators approved the motion on a vote of 33-16. However, Speaker John Arch (La Vista) did not schedule any further debate or votes on the bill and promptly moved on with the agenda. It is uncertain whether Speaker Arch will schedule the bill for a final vote.

Senators will return on Tuesday after the holiday weekend. Tuesday, May 27, marks day 85 of the 90-day session. With such limited time, many priority bills are unlikely to advance.

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