The Nebraska Constitution requires the Legislature to do only two things: meet on the first Wednesday after the first Monday in January, and pass a budget once every two years. Technically, the Legislature only has to pass this package of budget bills and nothing else. Legislatures are two years long. Much of the first session following the election is devoted to the budget. As I write this, we are in the middle of that debate right now.

The proposed budget for the State of Nebraska’s 2021–2022 fiscal year is more than $4.7 billion. It is broken into three broad groups of expenses. Operating the various agencies of state government costs about $1.6 billion. The largest expense in this category is the university system at almost $700 million. This category of spending is 2.2 percent more than the last budget. 

State aid to individuals is the second category, costing almost $1.5 billion. Medicaid is the largest expense in this category at almost $1 billion. This category of spending is 0.6 percent more than the last budget. Nebraska has one of the most generous welfare systems in the country. 

State aid to local governments is the third category. The TEEOSA formula (how the Legislature funds K–12 schools) is a little more than $1 billion. This category of spending has decreased 3.3 percent compared to the last budget.

Lastly we are going to spend about $40 million on construction in the capitol building to convert the 1930’s steam heat system to a modern geothermal HVAC heating and cooling system. This work is progressing on schedule and the contractors are doing a quality job that does justice to our historic state capitol building.

Thirty-one percent of all appropriations are of money we received from the federal government. This worries me because the federal government is printing a breath-taking amount of money out of thin air. According to the Federal Reserve, it has created 20 percent of the total money supply just since last February. All of this monetary inflation will drive up prices, and if the money from the feds ever dries up, the Legislature will face a serious budget crisis. 

The efforts we have made to reduce property taxes continues to be my number one priority. I agree with Senator Erdman who likes to say that most of what we have done to reduce property taxes in Nebraska “is just a decrease in the increase.” 

Property taxes continue to rise because we rely too much on them to fund our schools. To make property taxes just equal to the national average, we would need to appropriate another $700 million for schools on top of the $1 billion we already spend. There are not the votes in the Legislature to do this. Senator Erdman’s LR 11CA could be the answer in my opinion. I encourage everyone to check out this unique proposal. I am also very interested in the creative education reform proposed by Senator Lou Ann Linehan in her LB 364. That could help us save money and deliver a better education to Nebraska kids.