April 19, 2015

Nebraska businesses optimistic about next six months

Nebraska business owners and executives tell a University of Nebraska survey they’re optimistic about the next few months.

Bureau of Business Research Director Eric Thompson with the University of Nebraska-Lincoln reports on the latest survey of business attitudes about the next six months.

“Nebraska businesses have positive expectations for sales, but they continue to have very strong expectations for adding employment,” Thompson tells Nebraska Radio Network affiliate KLIN. “This suggests that this will be a good year in terms of job growth in Nebraska.”

One in five respondents to the March Survey of Nebraska Business expects to add employees over the next six months. Only four percent expect to cut jobs.

Half the respondents expect steady sales growth. Only 22% expect sales to go down. The sales outlook improved from the results in January and February.

The surveys are sent each month to 500 randomly selected Nebraska businesses. In March, 145 businesses responded.

One segment of the economy is holding Nebraska back: agriculture.

Crop prices have declined, according to Thompson, hurting farmers financially as well as the businesses which rely on farm sales. The slump is evident in the survey results.

“The larger cities, especially the Omaha area, but also Lincoln, there’s relatively positive outlook and in the more rural areas of the state, businesses have more moderate expectations,” according to Thompson.

For more on the survey, click here.

Jane Monnich, KLIN, contributed to this report.

Rallying the troops, state’s new economic development boss takes tour

Brenda Hicks-Sorensen

Brenda Hicks-Sorensen

Nebraska’s economic development director has been on the road the past few weeks, visiting community and business leaders in cities all across the state.

Brenda Hicks-Sorenson says her tour of Nebraska has taken her to small towns and big metro areas.

“I’ve been focusing on listening and talking to as many partners as well as internally to understand what we’ve been doing,” Hicks-Sorenson says. “I’m in that process right now of planning to plan. We’re going to be doing some economic development strategic planning and some things moving forward, so it’s really just been getting to know people and really listening.”

Hicks-Sorenson says she hopes the tour of Nebraska will encourage community members to become active in plans to help move the state forward.

“Any business owner, any economic development organization has potential,” she says. “They’re all stakeholders. We’re really looking at how we can manage that process with getting as many stakeholders as possible. I believe we’re going to have a core group of eight to ten individuals and a lot of working groups based on different issues like workforce and housing.”

After visiting 17 communities just last week, she says there are clear patterns emerging in some of the primary challenges before Nebraska.

“We have a lot of good problems because there’s a lot of growth, there’s a lot of folks adding jobs,” Hicks-Sorenson says. “The challenges tend to be workforce and housing across the state. That’s been a common theme.”

Hicks-Sorenson has been on the job for about month after being appointed by Governor Pete Ricketts.

By Dave Niedfeldt, KWBE, Beatrice


Nebraska could place business tax breaks under microscope

Do tax breaks actually create jobs?

It’s a question the Unicameral wants answered.

A bill calling for the evaluation of tax incentive programs to lure businesses to Nebraska has advanced in the Unicameral.

Speaker Galen Hadley of Kearney says Nebraska needs to determine whether companies would not have come to Nebraska “but for” the incentives the state offered, adding that any company that receives a tax break will always say it was vital to its decision.

“So, what we have in developing an audit here is to try and use other metrics and other tools to try to be a surrogate for the ‘but for’ test,” Hadley tells colleagues during legislative floor debate. “Looking at growth in employment, looking at capital expenditures; looking at things that will help us decide whether or not these programs are working.”

LB 538 purports to evaluate the various tax incentive programs offered businesses by the state. Each tax incentive program would be subjected to a performance audit at least every three years.

Sen. Ken Schilz of Ogallala says it is in the state’s best interest to discover whether corporate tax breaks actually work.

“We talk about property tax relief. We talk about income tax relief. And we talk about sales tax relief. There’s only one sure way to make sure we have that opportunity to do some of those relief packages and get some of that done and that’s through growth,” according to Schilz.

Sen. Paul Schumacher of Columbus says Nebraska needs to know how effective incentives have been to lure businesses to the state and what happens when another state offers a Nebraska business incentive to move.

“These are some of the interesting issues I think we’re going to end up dealing with in the next few years as we struggle with promises to deliver tax relief and at the same time face huge expense issues with baby boomers, with prisons, with pre-school education, and with a lot of other things that are going to be sobering and very difficult for this body to juggle,” Schumacher tells colleagues.

LB 538 has advanced to the next round of debate.

Lincoln restoration company fined by EPA

An emergency restoration company from Lincoln has reached agreement with the Environment Protection Agency for violating federal regulations.

RDF, doing business as Paul Davis Restoration, has agreed to spend $27,304 to replace windows in Lincoln houses built prior to 1978. The company also will pay a $3,033 penalty.

EPA Region 7 found RDF failed to follow federal regulations during remodeling for fire and water damage, including not complying with record retention regulations, not posting proper warning signs, and not collecting all paint chips and debris and properly storing them.

Ethanol industry riding high last year, suffering this year

KAAPA Ethanol in Minden/Photo by KAAPA Ethanol, LLC

KAAPA Ethanol in Minden/Photo by KAAPA Ethanol, LLC

What a difference a year can make.

Last year, the ethanol industry soared. This year, it has been rough.

Overproduction and the big drop in oil prices get the blame from industry insiders.

CEO of KAAPA Ethanol of Minden, Chuck Woodside, says strong profits last year spurred over-production.

“We’ve got over 15 billion gallons of production in a 14-billion gallon market,” Woodside tells Brownfield Ag News.

Woodside says something has to give.

“And whether that means that we see some reduction in runs, we’ve already started to see some within the last two months and we may see that continue, based on certain locations and certain technologies and capacities,” Woodside says.

There is an upside to this downturn, according to Woodside. The ethanol industry has grown stronger the past few years, reinvesting profits to provide a stronger foundation. That, says Woodside, will allow the industry to better weather the down market.

Ken Anderson, Brownfield Ag News, contributed to this story.