State lawmakers set to reconvene debates on government incentives
Amid budgetary and economic hurdles, legislatures face unprecedented challenges
Across the United States, lawmakers are facing new, unexpected budgetary challenges. Meanwhile, they’re taking on unprecedented economic hurdles, including record unemployment levels. All of this in the midst of an ongoing and unpredictable global pandemic.
As state lawmakers are set for legislative sessions throughout the country, government incentives are going to be at or near the top of the docket in many jurisdictions.
Below are a quick snapshot of just a few expected to take action in the coming days and weeks:
With only a few days remaining to address significant budget challenges, California state lawmakers are debating a list of potential cuts to funding and government incentives. State employee wages, in-home support services, education, and health programs are among the programs on the funding chopping blocks. State incentive programs are also at risk, including a proposal to limit corporate tax credits over the next three years. Under the proposal, corporations would be capped at utilizing $5 million in tax credits each year, despite the level of liability and credits earned.
Lawmakers in the Bayou State have been working to pass several government incentives and tax cuts in response to the COVID-19 crisis. Among the bills moving through the legislature, House Bill 17 would suspend the corporate franchise tax, allowing for more cash on hand for businesses. House Bill 13, which has moved out of the House Ways and Means Committee, would extend the Enterprise Zone Program into 2026 and expand eligibility to retail, hotels, and restaurants. Legislation has already been approved, as well, for small businesses in the form of a $300 million relief. As of now, Governor John Bel Edwards has not made any commitments to signing the legislation if and when it hits his desk.
With the state’s major incentive program, the Nebraska Advantage Act, set to expire at the end of 2020, the unicameral legislature is set to debate a prospective replacement, the ImagiNE Nebraska Act. The comprehensive legislation would create a new package of government incentives for qualifying businesses, including state income tax credits, sales and use tax refunds, property tax exemptions, and wage credits. Under this new program, eligibility and potential value would be determined on a revised capital investment and job creation formula.
State lawmakers are also expected to debate extended property tax relief, which would be delivered through an pivot in the way schools are funded in the Cornhusker State.
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