Small Nebraska towns with an abundance of jobs need more flexibility to attract new workers and retain residents who are natives of the state, said a lawmaker who presented a bill Tuesday that would let cities offer "relocation incentives."
LINCOLN, Neb. (AP) - Small Nebraska towns with an abundance of jobs need more flexibility to attract new workers and retain residents who are natives of the state, said a lawmaker who presented a bill Tuesday that would let cities offer "relocation incentives."
Sen. Kate Sullivan of rural Cedar Rapids said the measure would allow the cities to create the incentive programs at their own expense to draw plumbers, electricians, nurses, computer professionals and other high-demand workers. Communities would use revenue from a voter-approved, local option sales tax.
Sixty cities have approved the tax for economic development projects. Current law allows local governments to use their economic development dollars for business loan programs, job training grants and salaries for economic development staff.
Under Sullivan's bill, cities would be able to define what they count as "relocation incentives," but local officials would have to secure voter approval again to use the money for that purpose. Sullivan said the measure, loosely inspired by a state incentive program in Kansas, is intentionally vague to give cities as much leeway as possible.
"I think we'd better give them the flexibility to craft their own program and spend their own dollars," said Sullivan, who presented the bill to the Legislature's Urban Affairs Committee.
Lawmakers have considered another incentive program on a statewide scale, but rejected it in committee because of the estimated $2.3 million price tag. Kansas offers tax breaks and college loan payments to people who move to one of 50 rural counties. Sullivan said her bill would cost Nebraska nothing, because cities are only allowed to use their own sales tax revenue that voters have approved.
Caleb Pollard, executive director of the Valley County Economic Development Board in Ord, told lawmakers that the 200-plus businesses he represents have shown an interest in the bill. Pollard said businesses in his area face chronic workforce shortages, with 2.2 percent unemployment and an estimated 85 percent loss of area high school students to colleges in other parts of the state.
"We have a real opportunity to bring those kids back," Pollard said.
K.C. Belitz, president of the Columbus Area Chamber of Commerce, said businesses in his region have struggled to find skilled workers despite high unemployment nationally. He pointed to a trip his group made to northern Michigan to recruit welders, machinists and other workers. After hearing the sales pitch, Belitz said, the potential workers asked: "How am I going to get there?"
"That has been a challenge we've struggled with as a community for many years," Belitz said. "... Locally, we have put some of our resources into helping people move from Michigan to Columbus. But it just isn't enough."
Some lawmakers questioned whether the wording of Sullivan's bill would give cities too much authority to use the money as they please, with few restrictions.
"Relocation incentives, to me, could mean anything," said Sen. John Murante, of Gretna. "It could mean taking a CEO to Disneyland."
Lynn Rex, executive director of the League of Nebraska Municipalities, said cities would still have to outline to voters how they planned to use the money.
"You're not going to take a set of incentives ... to take CEOs on expensive trips," Rex said. "How many citizens are going to approve that?"
The bill is LB 295.
(Copyright 2012 by The Associated Press. All Rights Reserved.)
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