Challenges in 2006: states' top 10.

Here's a forecast of the hot policy issues facing legislatures this session.

2006 will be an intense year for state lawmakers. They'll react to the natural disasters, federal actions and court decisions of 2005. And they'll look years ahead as they craft energy, education and emergency preparedness policies to keep this nation strong.

Forty-four states have regular sessions this year, most convene this month. Here is NCSL's 2006 forecast of the issues we think will be hot. It's a testimony to the varied and complicated world the state legislature has become.

[1] PLANNING EMERGENCIES

The hurricanes of 2005 left unprecedented destruction in the Gulf states. They also exposed flaws in disaster response. The governors of Louisiana and Mississippi called special sessions to deal with the crises there in late 2005. Other states will confront disaster readiness this session.

"Given the problems in the Gulf states, all the states could review their evacuation plans and other emergency preparations," says Massachusetts Senator Richard Moore, a co-chair of NCSL's Task Force on Homeland Security and Emergency Preparedness. "The task force will take a broad look at disaster preparedness and give our colleagues some guidelines."

Ideas the group will explore include requiring stronger building codes, upgrading infrastructure, and establishing "State Guard" systems to be deployed when the National Guard is overseas.

Public health will be part of the equation as well. States will look at how hospitals can plan for catastrophic events, including a pandemic influenza outbreak. In an address to the National Press Club in October, U.S. Secretary of Health and Human Services Michael Leavitt called on every state and local government to develop a plan for a possible pandemic flu outbreak.

[2] CLOSING THE ENERGY GAP

The violent hurricane season raised gas and home heating costs to staggering heights. States responded with legislation to help consumers. Some, such as Georgia and Michigan, temporarily eliminated gas taxes. Louisiana banned price gouging. New Hampshire called a special session to discuss ways to help the poor pay their energy bills. Pennsylvania, looking at the government's own consumption, scheduled workshops to help cities conserve. Others downsized their automobile fleets.

"The hurricanes and 9/11 were wake-up calls for energy," says Kansas Representative Carl Holmes. His state put together an energy task force that started meeting in December to prepare legislation for this session.

Watch for more states to examine the strategies of last year. They will also devise new ones as they look for long-term solutions. Ten states have adopted renewable energy portfolio standards in recent years, and more are expected to consider these programs in 2006. Such standards require energy retailers to derive a percentage of their fuel from renewable sources.

[3] TAX AND SPENDING LIMITS

In November, Colorado voters overrode a section of the nation's most restrictive spending limit, effectively giving up more than $3 billion in refunds. (See page 24). California voters shot down a spending limit proposal backed by Governor Arnold Schwarzenegger (See page 27).

For the past five years, as states dug out of a $263.8 billion budget hole, lawmakers had to prioritize spending. But states are now reporting an improving picture, with the year-end balance at the close of FY 2006 projected at 4.6 percent. Ballot initiatives to curb government spending are expected in Maine and Ohio. Legislatures in Kansas and Wisconsin could discuss them as well."

Some states will focus on property taxes to relieve homeowners from escalating property values. In 2005, Nevada capped at 3 percent the percentage the assessed value of a home can increase in a year. Georgia, South Carolina and Texas tried to find a way to reduce property taxes too, especially for those on fixed incomes. They'll come back to the drawing board in 2006.

[4] DEFINING "PUBLIC USE"

A U.S. Supreme Court decision in June about the use of eminent domain provoked a burst of legislation from the states still in session in 2005 (See page 29). In Kelo v. New London, justices said that the 5th Amendment allows a locality to condemn property for economic development that would benefit the public at large. The Court left the door open for states to pass more restrictive laws, and to define "public use" for themselves.

In 11 of the 12 states that were still in session, lawmakers introduced legislation to adjust their own eminent domain statutes. Bills passed in Alabama, Delaware, Ohio and Texas. Momentum will carry this issue into 2006. These discussions have broad implications for both land owners and urban renewal efforts in states and localities.

[5] FUNDING EDUCATION

States spend about a third of their general fund budgets each year on K-12 education. But many say that's not enough to meet the requirements of the federal No Child Left Behind Act. While the federal government has provided some additional flexibility to states in 2005, many legislators say schools need more. Twenty states considered NCLB-related bills in 2005. Legislation requested more federal funding, waivers from certain parts of the law and permission for school districts not to comply. The Connecticut legislature passed a measure supporting its attorney general, who sued the federal government over the costs of implementation.

Higher education funding has been cut as states have struggled through the recession and the result is higher costs for students.

Factoring in inflation, tuition and fees at four-year public universities increased 54 percent during the past decade, according to the College Board's Trends in College Pricing 2005 survey. The biggest increase in any five-year period since 1975 occurred between 2000 and 2005 during tough times for states.

State support for higher education between FY 2001 and FY 2004 only increased 2 percent. State funding was largely replaced with higher tuition and fees.

"In the last few years during budget sessions, the states have paid a lot of attention to issues like health care and Medicaid. We have tended to put higher education on the back burner," said Connecticut Representative Denise Merrill, co-chair of NCSL's Blue Ribbon Legislative Commission on Higher Education. "But we're realizing that demographic trends and the global economy are forcing us to pay attention to the way we educate people in this country."

Look for states in 2006 to restore some higher education funding, examine new ways to disperse it and consider capping tuition. In a summer 2005 NCSL survey, 10 states said they would boost higher ed appropriations by 10 percent or more. In 2005, Colorado unveiled a new system that disperses a portion of college money to the student, rather than to the university, in an effort to get the state's public institutions out from under a spending limit and allow them to increase tuition. Illinois is looking at guaranteeing tuition rates for new enrollees. States are also expected to set aside more funding for need-based financial aid.

[6] EXAMINING IMMIGRANT RIGHTS

Today, one in nine U.S. residents is an immigrant--the largest proportion of the American population ever. And immigrants don't all live in border states and big cities anymore. Arkansas, Georgia and North Carolina all saw their foreign-born populations increase by more than 200 percent over the last decade, according to the U.S. Census. Most newcomers are in the country legally, but the Pew Hispanic Center estimates that 29 percent are unauthorized immigrants who pose policy challenges for all levels of government. Most of those challenges are falling to the states as the federal government hands them more responsibilities.

In the first half of 2005, lawmakers considered nearly 300 immigrant and refugee bills. Thirty-six passed. Colorado, Florida, Maine and Washington enhanced immigrant access to benefits. Virginia prohibited unauthorized immigrants from receiving state or local public benefits. New Mexico granted in-state tuition to certain unauthorized immigrant students. Arizona's bill to prohibit in-state tuition for illegal immigrant students passed the Legislature but was vetoed by the governor.

The pace of immigration isn't slowing. In 2006, legislators will continue to examine complex and emotional immigration issues including benefits, higher education, employment, identification and law enforcement.

[7] GPS FOR SEX OFFENDERS

The high-profile murders of 10-year-old Jessica Lunsford and 13-year-old Sarah Lunde in 2005 turned state and federal attention to sex crime laws. States passed more than 100 bills last session imposing longer sentences, banning "sex trafficking," requiring sex offenders to disclose more information when they register, and further restricting their activities, among other actions.

The states' newest strategy is Global Positioning Satellite technology to track sex offenders' whereabouts at all times. Nine states passed laws employing GPS for this purpose in 2005, Florida among them. After the abduction, assault and murders of Jessica in February and Sarah in April, Florida revamped its laws.

"The tragedy of these children's murders revealed several weaknesses in the system that had to be corrected," says Florida Representative Dick Kravitz. "They really caused us to rethink how we were supervising sex offenders in our communities." Kravitz called GPS monitoring "a powerful tool that can help prevent future tragedies."

Jessica's father, Mark Lunsford, is campaigning in other states to get similar statutes adopted.

[8] DEALING WITH REAL ID

Washington, which is home to just 4 percent of U.S. licensed drivers, estimates it will need to spend $45 million a year for the next six years to comply with the federal REAL ID Act of 2005. And that's just for the parts of the law already set in stone. States aren't sure exactly what is required of them--despite the fact they must comply by May 2008--because all the rules haven't been written yet.

Many states have not been in session since the passage of REAL ID, which aims to standardize driver's licenses and the process through which states administer them. Licensing noncommercial drivers historically has been the purview of the states. REAL ID changes that, but provides minimal funding to accomplish its mandates.

A few things that are certain at this point: The 11 states without laws that require drivers to prove they are in the country legally must develop them, and the 10 states that accept certain foreign documents as identification to obtain a license must ban that practice. States, beginning this year, will also have to establish ways to authenticate documents that residents present as identification when seeking a driver's license. And they will have to make licenses more difficult to duplicate.

[9] CONTEMPLATING STEM CELL RESEARCH

The debate over regenerative medicine will endure in state legislatures in 2006. Last year, states considered more than 170 bills on embryonic and adult stem cell research. More than a dozen states will carry over legislation, and others will consider new bills. Should embryonic stem cell research be legal? Should state funds support it? Should the state fund adult stem cell research instead? These are questions lawmakers will contemplate in 2006.

"These are complex scientific questions that the medical community and the political community have not settled," says Ohio Speaker Jon Husted. "When you dig down into these issues, you're looking at the science of defining when life begins. We're trying to have a thoughtful discussion in Ohio. I expect we will be one of many states in which these issues will start to arise."

A carry-over bill in Illinois would put a bond measure on the November ballot asking voters to approve $1 billion for stem cell research. A Missouri coalition is gathering signatures to put a constitutional amendment on the ballot there supporting stem cell research.

Legislation on this topic has become popular in states since 2001, when federal grants were limited only to projects using stem cells derived from embryos existing before August of that year. In 2005, Massachusetts passed a law permitting scientists to do research on new embryonic stem cells and has established a biomedical research advisory council that is looking at the feasibility of funding research there. Connecticut passed a 10-year $100 million plan to fund the research but limits research embryos to under 14 days of growth. And New Jersey awarded state grants for research. Last year, legislatures in Indiana and Wisconsin passed bills to ban cloning for any purpose, including research. (The Wisconsin governor vetoed that state's legislation.) In 2005, Indiana created an adult stem cell research center and Virginia created an adult stem cell research fund.

[10] IT'S A CAMPAIGN YEAR

Legislators won't always be thinking only of the vote at hand this session. Hard-fought campaigns will take place in 2006, when 80 percent of the nation's 7,382 state legislative seats expire.

From a national perspective, state legislatures have been at or near even in terms of party control since 2000. No major changes occurred in 2005, when only the New Jersey and Virginia house chambers were up for election. Democrats picked up a few seats giving them five more legislative seats nationwide, than Republicans. But Republicans still control two more chambers and one more legislature than do the Democrats.

Both parties are aiming for an advantage going into 2010 redistricting, which has broad ramifications. Forty-four state legislatures have authority to draw congressional boundaries in addition to their own. And in nearly half of those states, a shift of a handful of seats could put a different party in power.

So even though NCSL predicts these issues will be priorities in many states, in a campaign year, surprises abound.

"This is an election year," says Georgia Representative Georganna Sinkfield. "I really think a lot of issues will turn on what the public is screaming. If you can get enough people screaming about it, you can get it done this year."

Nicole Casal Moore is a writer with NCSL's Communications division.