President Foley, Speaker Hadley, Members of the Legislature, Tribal Chairmen, Distinguished Guests, Friends, Fellow Nebraskans, and of course, our First Lady, my lovely wife Susanne, it’s great to be a part of the second session of the 104th Legislature.
Folks, we live in the best place in the world. You have heard me say that before and I’ll continue to say it because it remains true. The reason we live in the best place in the world is because of our people.
Nebraskans give to their communities. We share a common set of principles. We treat each other with dignity and respect. And we care about each other.
I’m proud of the fact that Nebraska is one of the top states in the nation for volunteerism. The kids of Cub Scout Pack 190 picked up trash on Highway 7 last year.
When the floods slammed DeWitt, I saw firsthand how the community pulled together—neighbors helping neighbors. I met volunteers, like John Long from Omaha, who were cleaning houses with basements filled to the ceiling with mud and water. Thank you John for joining us here today and for your service.
There is no better example of service than the heroes of our Nebraska National Guard. They help their neighbors here at home and defend our freedom overseas. Last year, I met Lt. Eric Otte and the members of the 192nd Law and Order Detachment as they were being deployed. They were among the more than 150 Nebraska National Guard soldiers who were deployed last year. I’m pleased to say that Lt. Otte and his soldiers all returned home safely last month.
We are so grateful to the Nebraskans who put themselves in harm’s way to defend our freedoms. Sixty-one Nebraskans have been killed in action since 2003—12 from our National Guard.
We’ve also lost a Nebraska hero in the act of performing a humanitarian mission. On May 12th last year, Marine Corps Helicopter Pilot and Kearney native Captain Dustin Lukasiewicz saved three people in Nepal on a rescue mission after an earthquake struck. He was flying back to save more people when his helicopter crashed in the mountains. He left behind a wife, a daughter and a son on the way. He was known as Dusty to his friends and we salute his service.
Even if one of our best and brightest leaves Nebraska, their Nebraska spirit defines them. Joe Lemm played High School Football in Beemer, graduated, and joined the Air Force. After the service, he became a New York City cop. When terrorists knocked down the Twin Towers, Lemm worked for weeks, even when off duty, with his fellow officers, digging through the rubble, looking for survivors.
After 9/11, being one of New York’s finest wasn’t enough service for Joe. He joined the Air National Guard. Last month, on his third combat deployment, this time in Afghanistan, he was killed near Bagram Air Force Base by a suicide bomber. Joe’s mom Shirley is here. We salute Joe’s service and your sacrifice.
Where do we get such people? Thank God for Dusty and Joe and our Nebraska National Guard and for all the men and women who serve this country at home and abroad.
We lost another hero this spring, Omaha Police Officer Kerrie Orozco who was shot and killed while trying to apprehend a violent fugitive, leaving behind a new baby, a husband and two children.
Law enforcement officers have been receiving a lot of broad-brush criticism lately and it’s just not right. They put on their blues every day to protect us. Kerrie Orozco spent her time serving the families of Omaha as a volunteer coach and mentor in addition to being a police officer. The community she patrolled was an extension of her family and she paid the ultimate sacrifice to protect them. Here in the heartland, we appreciate Officer Orozco and all of the heroic police officers protecting us. Officer’s Orozco’s husband, Hector, is here today. We recognize you for your sacrifice.
On a lighter note, did you see the video of Deputy Sergeant Todd Volk of the Madison County Sheriff’s office? He sped past an out-of-control truck, jumped out of his vehicle and leapt onto the moving semi in order to bring it safely to a stop. To most of us, it looked like a scene from an action movie, but that was just real life for Sergeant Volk. And have no fear, Sergeant Volk is here, can you stand up please!
Whether it’s cleaning up our highways, patrolling our streets, or serving overseas, our people are everyday heroes.
That’s why this is the best place in the world. Nebraska is what America is supposed to be.
When it comes to public service, being a state senator is also a high and noble calling. I am grateful for the sacrifices you and your families make to serve our fellow Nebraskans. As I begin my second year as Governor, delivering my second state-of-the-state address, it feels like a family reunion and I’m not kidding.
Most of you know, I come from a big family and as kids I fought with my brothers and sister. As adults, we still disagree on important topics, but I love them and I love working with them. And I love the work we do here and working with all of you.
Sure, we’ve had our moments. But we’ve accomplished great things together.
In the last session, we cut the growth in state spending nearly in half, from 6.5 percent in the last budget to 3.5 percent in our current budget. I want to thank Chairman Mello and the Appropriations Committee for all their fine work.
We also enacted the nurse practitioner bill to increase access to healthcare—particularly in our rural areas.
Together we addressed the cliff effect for childcare with Senator Tanya Cook’s bill.
And Senator Kathy Campbell and I reached an agreement to increase Aid to Dependent Children in a responsible way. These are just a few of the many bills on which we found common ground.
Sometimes there was a natural tension. But it’s an honor to be a part of our work here in our state capitol. Thank you for your dedication, for the long hours you put in, and for the service you provide this state.
Because of our accomplishments together and the strength and character of our people, I am proud to report today that the State of our State is strong.
Forbes Magazine rates us the third most business-friendly state. Health.com says Nebraska is among the ten healthiest states and Livability.com says Lincoln and Omaha are among the most livable cities in America. Meanwhile Nebraska’s government enjoys a Triple-A rating from S&P. We are in a strong position, but we also have our challenges. Those challenges pose opportunities for us to work together to respond and Grow Nebraska.
Agriculture is our largest industry—representing nearly 25 percent of the state economy. But our farm economy is facing challenges.
Right now, commodity prices are flat or down. Corn is around $3.50 a bushel, a significant drop from the $8 a bushel price in 2012. Cattle prices are down 17 percent over the last year.
And while farm incomes are subject to fluctuations each year, property taxes go up and up. Last year, I told you about Roger Brandt, who is a farmer in Wayne County. His assessments for three parcels of farmland increased between 36-to-nearly-50 percent in just one year.
We checked in with Roger on this year’s property taxes and they went up again, nearly $2700 and that’s after the property tax credit relief we passed last year. While commodity prices stayed flat or declined, his property taxes rose nearly 10 percent.
Folks, those increases put our farmers and ranchers under tremendous pressure and in turn, the largest part of our state’s economy.
Last year, we successfully worked together to provide $408 million in direct dollar-for-dollar property tax relief to Nebraskans through the Property Tax Credit Relief Fund. This year, we must make structural changes to property taxes.
Working with Chairwoman Kate Sullivan, Chairman Mike Gloor, and their committees, we have crafted a proposal for property tax relief. You will see in the bill that we propose to tighten spending and levy limits and we limit the statewide aggregate growth of agricultural property valuations to three percent.
Senators, I look forward to working with you to bring relief to our taxpayers. We must prioritize property tax relief, it’s my number one priority this year.
We’ve talked about growing Nebraska. And indeed, we grew our population faster than any other state around us except Colorado and added 13,000 people.
But our economic growth rate is sluggish. We are 28th in the nation in employment growth. Our rankings for GDP and personal income growth are also in the middle of the pack. There is nothing competitive about being in the middle of the pack.
We need to grow Nebraska’s economy, create more and better paying jobs, keep our kids and grandkids here, and attract people from all over the country to come and make Nebraska their home. Our three largest industries are agriculture, manufacturing, and tourism and they all require a strong transportation infrastructure to expand.
We can spur our economic growth by ensuring we have 21st-century roads and bridges to grow our industries.
Once again, we’ve been working with you to address this critical need. Over the last several months, Chairman Smith and Department of Roads Director Kyle Schneweis have traveled the state, working on ideas on how we can accelerate infrastructure investment.
Last week, we announced a proposal for a transportation infrastructure bank to speed up expressway construction, improve county bridges, and assist companies with economic development. Also included are new tools to increase the efficiency of our construction process. Our businesses transport our goods and services. Our farmers and ranchers deliver the food to feed our world on our roads and bridges. We get to work each day on our highways. We drive our children to school over our county bridges. Let’s help local leaders keep and attract businesses. Let’s pass the transportation infrastructure bank.
As I said, S&P gives us a Triple-A rating and we have a very strong financial position at the state. However, we can’t rest on our laurels. The Forecasting Board revised our revenue forecast downward by $154 million.
We have to work together to manage taxpayer dollars wisely. The budget I’m proposing manages this shortfall by tightening our belts in the state agencies, returning re-appropriated funds to the state’s general fund, and transferring money from the banking and insurance cash funds into the general fund. As a result, no money will be taken from the cash reserve—and none is needed—to fund ongoing operations.
We must also make government work for the people.
We all know in 2014, before I took office, the Omaha World-Herald broke the story of dozens of convicted criminals, many of them violent, being released from prison early because of errors in sentencing calculations at the Department of Corrections.
I know this is a topic everyone here cares about deeply. The Legislature worked hard on this issue since it came to light. I appreciate your dedication to the safety of Nebraskans.
Over the last year, the three branches of government have worked together on issues such as LB605 from the Council of State Governments, dealing with sentencing and corrections reform.
Last year, we brought in Director Scott Frakes to lead the Department of Corrections. Director Frakes is bringing about a culture change to one of accountability and excellence.
To address mistakes in inmate releases, he is instituting a new automated system to perform sentence calculations.
We also know that further investment is needed. In November, Director Frakes unveiled the first phase of his strategic plan—including a $26 million investment in the Community Corrections Center in Lincoln.
This investment will allow us to expand our capacity for re-entry programming. We will provide job training, work release, and counseling. Our goal is helping offenders avoid becoming repeat customers and ultimately reduce recidivism.
We must make this wise investment.
One of the biggest long-term risks we face to the budget is Medicaid expansion. This body has wisely rejected Medicaid expansion three times in the past three years because it is an unreasonable risk to Nebraska taxpayers. The most recent iteration of expansion would have cost Nebraska taxpayers $158 million over six years.
Medicaid has already grown from 2.9 percent of Nebraska’s budget when it started to where it is today: 19 percent of our budget and growing. This government entitlement crowds out investments in tax relief, education, and roads—things we need to grow our state.
We also know that we cannot trust the federal government to keep the commitments it makes when it comes to spending. A 90 percent federal match is not sustainable in the federal government budget.
When the federal budget gets tight, or priorities change in Washington, that commitment will disappear. History shows, the federal government changes the rules at any time. For example, the federal government promised to pay 40 percent of the cost of the expansion of special education for our schools. Today, the federal contribution is less than 20 percent.
From denying people their choice of doctor, to rising premiums and now this unrealistic promise of federal matching dollars, Obamacare is an example of government that does not work.
Government needs to work for people and government service is a noble calling as well. We have many great people in state government who show up to work every day to help our fellow citizens.
From the cabinet to our frontline teams, we have been able to make great strides over the past year on making government work—and helping with the business of life—for our people. I want to highlight some of the great work of our people starting with the Nebraska Department of Health and Human Services (DHHS). I’m proud of the progress that the team at DHHS is making under the leadership of CEO Courtney Phillips.
We are working to ensure a new level of transparency and accountability for taxpayers. Our people are dedicated to giving vulnerable individuals the best possible experience in receiving assistance and creating a more customer-centric organization.
One example is ACCESSNebraska that serves our fellow Nebraskans who need our help—from nutrition, to child care, to assistance with energy bills.
As I traveled the state, I used to hear a lot of complaints about ACCESSNebraska. The average call wait time in August 2014 was almost 24 minutes. Now, because of process improvements, the average wait time for the last three months is under five minutes.
Imagine being a low-income Nebraskan with a prepaid phone with 45 minutes on it and then you had to spend over half those minutes waiting on hold. What does that do to your quality of life? Not only have we reduced the average wait time but we also have improved the accuracy rate.
Nebraska’s national rank in processing SNAP applications was 48 out of 53 at the beginning of my term and now we are up to 32. Now, nobody is happy about being in the middle of the pack, but we are showing improvement. We are now 21st in payment accuracy and 10th for denial accuracy. At the end of 2014, the average time to process applications was 40.9 days and now our average is 11.5 days.
Members of the ACCESSNebraska team are here with us today. Please recognize them for all their efforts to improve this important system.
We have seen improvements in other areas as well. In 2015, for the first time ever, our work in the child welfare system exceeded all six federal standards. Three years ago we only met two of those six standards.
Other agencies have been innovating as well to make government more customer-focused. The Department of Labor launched a first-in-the-nation reemployment program to help our state’s job seekers connect more quickly with good-paying jobs. Individuals receiving benefits now participate in the program, which includes job coaching and creating a resume that is searchable by potential employers. This helps give our job seekers a leg up.
Alan Holman of Lincoln was helped by our reemployment program to get a job at Sirius Computer Solutions. Alan, his wife Becky, and his boss Kevin Langford are here with us today. Alan and Becky congratulations. And Kevin, thank you for giving Alan some time off to be here today.
Since I took office, our state agencies have made it a priority to identify cost reductions. Chief Information Officer Ed Toner found $5 million in cost savings for taxpayers.
We are now able to pass along an additional $3.3 million in roads funding annually to cities and counties.
In every agency of state government, we’ve worked to create a customer-focused culture of accountability and excellence. We are embracing new ideas to make government work and to make the business of life happen for our citizens.
In the session ahead, I very much look forward to working with each of you to take advantage of the opportunities we have to meet the challenges head on and Grow Nebraska.
Let’s work together to:
Deliver property tax relief;
Grow Nebraska with a transportation infrastructure bank;
Manage our budgets by controlling spending; and
Continue to reform our prison system and invest in community corrections.
This session is also important for another reason, 11 members of the Unicameral are closing this chapter of their public service.
Among those leaving is Speaker Hadley. Mr. Speaker, I value our friendship, your leadership and your advice and counsel not only regarding the work of the Legislature but your invaluable advice for the Chicago Cubs. On behalf of the people of Nebraska, thank you.
And ten more of your colleagues are leaving at the end of the year. Can you please stand up so that we may recognize you?
Senator Dave Bloomfield
Senator Kathy Campbell
Senator Colby Coash
Senator Tanya Cook
Senator Mike Gloor
Senator Ken Haar
Senator Heath Mello
Senator Beau McCoy
Senator Ken Schilz
Senator Kate Sullivan
Once again, our family here in the state capitol will have its moments this session—no doubt. But I know, when the ice thaws, the snow melts, spring arrives and sports fans—and Speaker Hadley—turn to baseball, we will have accomplished much in this session for the people we represent.
The people of Nebraska are good, hard-working and courageous people. They are the best of America and so we will give them our best. God Bless you, God Bless America, and God Bless the great State of Nebraska.
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