NEBRASKA LEGISLATURE
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Sen. John Kuehn

Sen. John Kuehn

District 38

The content of these pages is developed and maintained by, and is the sole responsibility of, the individual senator's office and may not reflect the views of the Nebraska Legislature. Questions and comments about the content should be directed to the senator's office at jkuehn@leg.ne.gov

A common misconception is that the Legislature appropriates money to the level of a specific position, agency process, or reimbursement fee. A high level of detail may be provided during public hearings and in budget documents to explain the intention for how requested funds plan to be used, but the actual appropriations bill is not that specific. “Intent language” is statutory language associated with an appropriation amount that provides specific legislative direction for how funds are to be used. These earmarks are the exception, not the rule. A budget can best be described as a plan for spending during a fiscal year. A government budget document does not tell you how dollars were actually spent, but rather is a prospective document that details how they plan to be spent.  

Each state agency is assigned a number within the state budget system. For example, the Department of Agriculture is Agency 18, while the Department of Corrections is Agency 46. An agency can be a “code” or “non-code” agency, indicating whether it is under direct management of the Governor or is independent. Code agencies have a Director hired by and are accountable to the Governor. The Departments of Economic Development and Revenue are examples. Non-code agencies are autonomous, with governing boards that may be elected or appointed. Management of those agencies is accountable to their board, although the Legislature has the sole authority to appropriate public money. To illustrate, the Tourism Commission is governed by an appointed Board of Directors defined by statute, while the Board of Regents of the University of Nebraska operates under constitutional authority.

The Appropriations Committee allocates specific dollar amounts of General, Cash, and Federal Funds to each agency. Within the agency, the appropriations are specified into one of three categories: operations, aid to individuals, and aid to local government. Operations budgets are the dollars appropriated for the day-to-day functions of the agency. This includes employee costs, office space, and all of the expenses associated with running the agency. Contrary to popular belief, operations expenses are only approximately $1.5 Billion of the $4.6 Billion General Fund budget. Higher education makes up over ⅓ of the total. Operations of all of state government comprise less than 25% of the total General Fund Budget.

Aid to individuals is commonly referred to as entitlement spending. These are public dollars that are paid directly to individuals, such as with public assistance, or paid for specific services associated with an individual, such as developmental disability aid. Some programs, like student grants for higher education, are wholly funded with state tax dollars. Others, like Medicaid, are a cost share with the federal government. Thus, the appropriation includes both General Fund and Federal Funds. Aid to individuals is about ⅓ of the General Fund budget, with Medicaid, by far the largest individual aid program, comprising 60%.

Aid to local government is dollars that pass through the state to local political subdivisions. Over ⅔ of that aid, almost $1 Billion is TEEOSA aid to K-12 public schools, commonly referred to as state equalization aid. Special education and community college aid make up another $300 Million in aid to local governments. One-third of the state General Fund is distributed to local governments.

An agency may have specific subdivisions, known as programs, which divide the agency’s budget. The number of programs or their size within any agency has a historical basis. Some agencies are appropriated as a single program, while others have many program areas of varying size. Management within an agency has the statutory authority to move dollars around within a program area. They may not transfer appropriations between programs in an agency without legislative approval. An appropriation is a legal authority for the agency to spend allocated dollars within the boundaries of state statute.

The budget is a plan, and is not actual spending. Expenditure reports detail how and if the dollars were spent as originally planned. If budgeted funds are not spent, they may be rolled over into the next budget. These carryover funds are known as “reappropriations”. Because Nebraska uses a baseline budget process that does not require justification of funds appropriated in prior budgets, reappropriated dollars are common. Historically there has been little legislative oversight of the use of these funds, as blanket reappropriations are frequently allowed.

Sen. John Kuehn

District 38
Room #2000
P.O. Box 94604
Lincoln, NE 68509
Phone: (402) 471-2732
Email: jkuehn@leg.ne.gov
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