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Bill Would Give One-Year Tax Break For Hiring Ex-Felons

LINCOLN, Neb. (AP) – Nebraska businesses that hire felons could get a tax break that’s designed to make it easier for them to get jobs and reduce the likelihood they’ll re-offend under a measure before lawmakers. Iowa, Louisiana, and Texas have similar laws.

The bill introduced last week by Omaha Senator Justin Wayne allows companies to deduct 65% of the wages paid to workers with a felony conviction during their first year of employment with a cap of $20,000 per employee.

Supporters say the bill would encourage employers to take a risk on potential employees whose criminal records limit their job prospects. It would cost the state about $2.4 million a year in lost revenue starting in fiscal year 2021 and Wayne is still looking for ways to cover the cost.

Wayne introduced a similar bill last year but it failed to advance out of the Legislature’s tax-focused Revenue Committee, but chairman Lou Ann Linehan says that’s because no senator had given it a priority designation to move it higher on the schedule for debate.

Business groups haven’t yet said whether they’ll endorse the measure. The Lincoln Independent Business Association threw its support behind last year’s bill, but the group won’t decide until later this month which bills it will back this session.

Studies commissioned by the U.S. Justice Department have found that inmates who find a steady job after their release are less likely to reoffend. Wayne says the goal of the bill is to make sure people have jobs once they’re released from prison by encouraging more businesses to hire them.

Nationally, the unemployment rate is under 4% for the general population but the jobless rate for ex-felons is 27%, according according to a 2018 analysis by the Prison Policy Initiative, a national research and advocacy group.

Nebraska has already taken some steps to help prisoners find jobs, including a state-sponsored Workforce Academy – a joint effort of the departments of Labor and Correctional Services that prepares inmates for job interviews.

Labor spokeswoman Grace Johnson says it includes resume and job application assistance, mock interviews, and an assessment of inmates’ skills. Johnson says employers can also claim a federal tax credit of up to $2,400 for hiring ex-offenders.