2013-14 Session of Nebraska Legislature

2013-14 Session of Nebraska Legislature--What will Directly Affect the Construction Industry?

This has been a good session for our industry in terms of “end results”. I would say that the majority of the cumbersome and scary pieces of legislation were handled and put away at the committee stage of the process. A couple of proposed ideas were put to rest even before the session started!

There are three bills that have passed the Legislature that will affect us: LB 961 (formerly LB 373), LB 191 and LB 930. The three bills also offer an example of what can happen to a bill in 60 days; bills go good to not-so-good; bad to not-so-bad; or “???” to “ OK at least now I at least get it”.

Bad to Good:
LB 373
was introduced in 2013 by Sen. Mello to make changes to the Nebraska Construction Prompt Pay Act. The Building Chapter opposed the bill at hearing. Prior to the hearing we had started a discussion with Sen. Mello and staff regarding our concerns with the bill. Late last spring AM 1550 was negotiated between AGC and Sen. Mello. In February, Speaker Adams included LB 373 as one of his priority bills.

LB 373 AM 1550 made several changes to the NE Construction Prompt Pay Act—passed in 2010. We originally opposed the bill; but after a lot of negotiating between everyone involved and Sen. Mello being willing to work with everyone in industry—we ended up with a pretty decent amendment.

The Amendment includes the following elements:

  • Definition of Substantially Complete.
  • Retainage is capped at 10% of contract from 0-50% complete and then 5% from 50-100% complete.
  • Owners or owner representative must pay retainage within 45 days of substantially complete; prime contractor must pay subcontractors within 10 days of that.
  • Plaintiff MAY receive attorney fees if civil action is taken.

LB373 passed the first round of floor debate with zero “nay” votes. If there were more days left in the session the bill would have likely passed as LB373. However, as time was running out on the legislative session Sen. Mello made the decision to amend LB373 into the Business & Labor Committee’s shell bill LB961. This insured that the bill would make it to final reading. LB 961 PASSED on April 10 and now awaits the Governor’s signature.

Good to Not So Good:
LB 191
was introduced in 2013 by Sen. Nordquist and others to create the Nebraska Job Creation and Mainstreet Revitalization Act.

This bill is a historic renovation bill and originally was modeled after Iowa’s Historic Preservation Tax Credit Program. The bill started out providing a state tax credit for 20 percent of first $10M of eligible expenditures and 10 percent after that. The tax credits were transferrable or saleable at 100 percent of face value.

After much debate and floor discussion the bill was amended to:

  • Non-refundable credits
  • 20% of eligible expenditures up to a minimum credit of $1M
  • Credits may be sold at 50% of face value
  • A whole bunch of other odd things that got amended into the it

LB 191A which is the appropriations bill for LB191 also passed on final vote of the Legislature. The Legislature PASSED this bill on April 9 and now awaits the Governor’s signature or veto.

“???” to “OK at least now I at least get it”:
LB 930
was introduced by Sen. Watermeier at start of 2014 to make changes to One-Call Notification System Act. The bill stated that no excavation shall be performed within 25 feet of an underground natural gas transmission line as defined or any underground facility designated a critical facility by an operator unless a representative of the operator of underground natural gas transmission line or critical facility is present at the planned excavation area. AGC and MCA presented joint opposition at hearing to this bill because of possible work delays and liability issues it presented to excavation contractors. AGC and MCA were involved in negotiating a change to the bill. Here are the basics of the amendment that was included in the bill. The bill now reads, “If the representative of the operator fails to appear at the proposed excavation area at the time work is scheduled to commence, the excavator shall notify the operator that the representative failed to appear and excavation operations can begin if reasonable precautions are taken to protect the underground facility.” The Legislature passed this bill and it awaits the Governor’s signature.

Just like football—there is always the next season—only with 17 new players AND a new Governor!