It’s been a long few weeks of debate. The Legislature’s focus has remained with the rules governing it and the State’s budget deficit. After a long debate over the last couple weeks on LB22, also known as the deficit bill, and the Appropriation Committee’s adjustments to that bill under AM13, the Legislature has advanced the bill to Final Reading, which is the last round of debate before advancing to the Governor for passage into law.
LB22 is part of the Governor’s recommendations to close the State’s nearly $900 million budget deficit, which was brought to the Appropriations Committee of which I was elected Chair earlier this year. There was a lot of debate and passion contributing to the discussion, with many Senators analyzing line item by line item to raise their concerns over the Governor’s recommendations. The Governor’s recommendations included a net decrease of $151 million in deficit appropriations, or cuts. The Committee adjusted this number to a net decrease of $137 million in cuts, which the Legislature advanced by a vote of 45-4.
Only thirty percent of state agencies will be affected by these cuts.
Since the budgeting process is very thorough, I’d like to explain the process so that citizens of District 48 may be informed in their decision making.
You will often hear the Legislature refer to the “fiscal year,” or “FY” for short. In governmental accounting, the ledger does not correspond neatly with the calendar year of which most of us are familiar. The fiscal year for Nebraska will look something like this: “FY2016-17,” which runs from July 1st of each year to June 30th. While it may seem cumbersome, the State’s accounting method corresponds with the legislative session, where decisions on the state budget are made. This accounting method ensures that the Legislature has ample time to balance the budget.
The budget is enacted in two-year “bienniums” and looks something like this: “FY2017-18 and FY2018-19.” The next biennium begins on July 1st, 2017 and ends on June 30th, 2019. The mainline budget, which deals with operations and state aid, is enacted in odd-numbered years. While the deficit bill has produced much discussion, the mainline budget is likely to be the main focus this session.
In most years we would start with the mainline budget and other accompanying budget bills. But this is not a normal year. Since we are facing a significant budget shortfall, the deficit bill is the first step in the process towards balancing our budget. It should be noted, however, that not all deficit appropriations are decreases in spending.
To ensure the continuance of some of Nebraska’s most critical services, the Governor proposed $20 million in deficit appropriation increases, which was adjusted to $23 million by the Appropriations Committee. Some of these increases included $8.5 million to fulfill some of the State’s obligations to Medicare, $7.8 million to sustain the Department of Health and Human Services’ Child Welfare program, and $4.6 million to Developmental Disability aid.
The Appropriations Committee is now working to complete what is called the “preliminary report,” which will be used during the next stage of the budgeting process. A lot of work goes into the development of this report. The Committee reviews each agency’s budget request, line item by line item.
Starting next week, the Committee begins public hearings on agencies’ budget requests, which will occur through mid-March. Also included during these hearings will be appropriations bills, or “A bills.” Any substantive bill introduced to the legislature which has a direct fiscal impact on the state budget must be accompanied by an A bill. Each A bill is treated separately. It will receive a public hearing by the Appropriations Committee and require the legislative body’s approval, just like any other bill.
After public hearings have been heard, the Committee will again review the requests based on the information obtained during public hearing. The Committee will consult with the Legislative Fiscal Office to determine how the State’s budget will be formulated and will finalize its recommendation before advancing to the legislative body for debate.
The Appropriations Committee has until the 70th day of session to advance its budget bills to General File, which will fall on April 24th of this year. If the Committee does not make this deadline then the Governor’s recommendations must be considered. This two-part process is a safeguard designed to ensure that the body upholds its constitutional duty to balance and pass the budget.
The budget can be divided into numerous bills including the mainline budget, deficit, constitutional officers’ (i.e. other elected officials and judges) salary, legislators’ salary, capital construction projects, and fund transfers bills. Other types of budget bills may be offered as needed. By May the Legislature should finish debate and be ready to pass Nebraska’s comprehensive budget.
I hope the description provided here informs you as a citizen of District 48 and of all Nebraska on the budgeting process. As the representative of District 48 and Chair of the Appropriations Committee, it is my honor to serve the State to the best of my abilities. I hope this information proves useful as you carry out your civic duties.
As always, I remain open to your feedback on how I may address the issues that mean most to you. Please do not hesitate to contact my office with any questions you may have. Thank you to those who have taken the time to express their views on various issues. My contact information is located on the right hand side of this webpage.