As we begin the new year, we also begin a new legislative session. On Wednesday, January 8, we begin the 109^th Legislative Session. Since this is the beginning of a new biennium, the first day begins with the swearing-in of the newly elected Senators and the election of leadership for the coming two years.

This day also marks the end of the term for those 15 Senators who are term-limited. I want to personally thank them for their service and wish them well in the next phase of their lives. I also want to welcome the newly elected Senators who will replace them. In western Nebraska, we will be welcoming Paul Strommen (District 41) and Tanya Storer (District 43). Both Paul and Tanya have already made very positive impressions with the rest of the body; I have no doubt that they will represent their districts very well.

I was invited to attend a meeting on Friday at the Governor’s residence to discuss the Governor’s proposed budget proposal. As of the latest Forecasting Board revenue projections, revenues were reduced to the point that the current budget projects a $432,639,146 deficit for the upcoming biennium ending on June 30, 2027. If no changes are made in this biennium, the deficit will grow to $1,128,632,184 by the end of the next biennium, ending on June 30, 2029. But, since our state Constitution requires a balanced budget, adjustments will need to be made this session.

Some have suggested that we have plenty of money in reserves, so there is nothing to worry about. That is generally true, but we need to keep in mind that, in addition to our rainy-day fund, there are many funds within various agencies that have large reserves that are committed for future projects that are still in development stages. The more relevant funds to target are Cash Funds. Cash funds represent funds that were allocated to various agencies for operating expenses that went unspent during the fiscal year. Those funds will clearly be targeted to be swept to help fund the current deficit since they are not committed to other projects.

In addition to using cash funds to assist in funding the deficit, I am happy to share that the Governor’s budget focuses on spending cuts and, in particular, the repeal of several bills that were passed this in the last few years that had spending tied to them.

Although I have some reservations about a few of the cuts, I understand the need to have a fair approach to balancing the budget. Keep in mind that this is the Governor’s proposal, which only serves as a starting point for the Legislature’s budget process. The hundreds of bills that will be introduced during the first 10 days of the session will certainly include bills that will run counter to what the Governor will propose or request spending. But in the end, one thing that must be completed in the upcoming 90-day session is approving a budget.

Keep in mind that the Forecasting Board will continue to meet and will update the revenue forecast each time. Many of us are skeptical of the significant reduction in forecasted revenues. Hopefully, the forecast will be adjusted higher as we move forward. Meanwhile, we will work with the numbers we have to work with.

I will continue to keep you updated as the session moves forward. It should be interesting.

I look forward to continuing to hear from you about issues that are important to you. It is a privilege to serve as your State Senator, and I will continue to give my full effort to make a positive difference for the District and the State. You can reach me at mjacobson@leg.ne.gov or 402-471-2729.