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The historical Nebraska budget and finance information below applies to years prior to the most current fiscal year. With the exception of the tab labeled "Prior fiscal year budgets," the tabs below display information, from several different fiscal years, as it was presented on Ballotpedia in prior calendar years. For more current information regarding Nebraska's budget and finances, click here.

As published 2016

Nebraska budget and finances

General information
Budget calendar: Biennial
Fiscal year: 2017
State credit rating: AAA (as of 2014)
Current governor: Pete Ricketts
Financial figures
Total spending (state and federal funds): $11 billion (estimated for 2015)
Per capita spending: $5,791.61 (estimated for 2015)
Total state tax collections: $4.9 billion (2014)
Per capita tax collections: $2,590.26 (2014)
State debt: $13.1 billion (as of 2014)
Per capita state debt: $7,081 (as of 2014)

State budget and finance pages • Total state expenditures • State debt • Tax policy in Nebraska

In Nebraska, as in other states, lawmakers and public officials are elected in part to manage the state's finances. This includes generating revenues (money coming into the state from various sources) and approving expenditures (the money spent on governmental functions and servicing state debt). State budgets are complex and fluid, as they depend on anticipated revenues and planned expenditures, which may alter over the course of a fiscal year. If revenues do not keep pace with expenditures, states generally have to raise taxes, cut services, borrow money, or a combination of the three. State budget decisions are also influenced by policy decisions at the national level, such as the Affordable Care Act or energy and environmental regulations, and issues at the local level, such as crime and the quality of education.

HIGHLIGHTS

Between fiscal years 2014 and 2015, total government spending in Nebraska increased by approximately $440 million—from $10.5 billion in fiscal year 2014 to an estimated $11.0 billion in 2015. This represents a 4.01-percent increase.^[1]^[2]^[3]

In Nebraska in fiscal year 2014, 49.8 percent of total tax revenues came from income taxes. Sales taxes and gross receipts accounted for 47.2 percent of total state tax collections.

Education accounted for 37.9 percent of state expenditures in fiscal year 2015, while 17.6 percent went to Medicaid.

The Nebraska state budget and financial data presented here come from different years because the states and the federal government report and publish the information at different times.

Definitions

The following terms are used to describe a state's finances:

Revenues come mainly from tax collections, licensing fees, federal aid, and returns on investments.
Expenditures generally include spending on government salaries, infrastructure, education, public pensions, public assistance, corrections, Medicaid, and transportation.
State debt refers to the money borrowed to make up for a deficit when revenues do not cover spending.
The state credit rating is the grade given by a credit rating agency based on the general financial health of the state's government and economy.
State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."^[4]
Federal funds are "funds received directly from the federal government."^[4]
Total spending is calculated by adding together the totals for state and federal funds used for expenditures.

Note: In comparing dollar amounts across the states, it is important to note that the cost of living can from state to state and within a state. The amounts given on this page have not been adjusted to reflect these differences. For more information on "regional price disparities" and the Consumer Price Index, see the U.S. Department of Commerce, Bureau of Economic Analysis.

Revenues

2014 revenues

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2014 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "2013 population" and "Per capita collections" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "2013 population" and "Per capita collections" have not been abbreviated.^[5]

Compared to neighboring states, Nebraska had the second highest state tax collections per capita, at $2,590.

State tax collections by source ($ in thousands), 2014
State	Property taxes	Sales and gross receipts	Licenses	Income taxes	Other taxes	Total	2013 population	Per capita collections
Nebraska	$143	$2,303,952	$126,745	$2,430,755	$15,806	$4,877,401	1,882,980	$2,590
Iowa	N/A	$3,771,938	$808,047	$3,586,277	$105,577	$8,271,839	3,109,481	$2,660
Kansas	$81,267	$3,890,900	$395,454	$2,841,841	$125,019	$7,334,481	2,902,507	$2,527
Missouri	$29,725	$4,915,210	$564,474	$5,719,700	$11,548	$11,240,657	6,063,827	$1,854
South Dakota	N/A	$1,296,748	$277,787	$24,819	$9,142	$1,608,496	853,304	$1,885
United States	$14,232,835	$411,414,175	$51,120,024	$357,104,785	$31,880,270	$865,752,089	318,907,401	$2,715
Source: U.S. Census Bureau, "2014 annual survey of state government tax collections by category," accessed April 4, 2016

Nebraska tax collections by source in 2014.
Source: U.S. Census Bureau

The table below lists 2014 tax collections by source as percentages of total collections. About 50 percent of Nebraska's total state tax collections came from income taxes.^[5]

State tax collections by source (as percentages), 2014
State	Property taxes	Sales and gross receipts	Licenses	Income taxes	Other taxes
Nebraska	0.0%	47.2%	2.6%	49.8%	0.3%
Iowa	N/A	45.6%	9.8%	43.4%	1.3%
Kansas	1.1%	53.0%	5.4%	38.7%	1.7%
Missouri	0.3%	43.7%	5.0%	50.9%	0.1%
South Dakota	N/A	80.6%	17.3%	1.5%	0.6%
Source: U.S. Census Bureau, "2014 annual survey of state government tax collections by category," accessed April 4, 2016

Federal aid to the state budget

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, mainly in the form of grants for such things as Medicaid, education, and transportation. In 2013 federal aid to the states accounted for roughly 30 percent of all state general revenues. Federal aid varies from state to state. For example, Mississippi received approximately $7.5 billion in federal aid in 2013, accounting for about 43 percent of the state's general revenues, the highest percentage of all of the states. By contrast, North Dakota received about $1.5 billion in federal aid in 2013, or just 19 percent of the state's general revenues, the lowest percentage in the nation.^[6]

The table below notes what share of Nebraska’s general revenues came from the federal government in 2013. That year, Nebraska received approximately $3.2 billion in federal aid, 32.1 percent of the state's general revenues. Taking into consideration the state's 2013 population, this came out to about $1,688 in federal aid per capita. Figures from surrounding states are provided for additional context.^[7]

Federal aid to state budgets, 2013
State	Total federal aid ($ in thousands)	Federal aid as a % of general revenues	Ranking (by % of general revenues)	Est. 2013 population	Aid per capita
Nebraska	$3,154,670	32.1%	26	1,868,516	$1,688
Iowa	$5,915,221	31.9%	27	3,090,416	$1,914
Kansas	$3,788,962	24.9%	44	2,893,957	$1,309
Missouri	$10,188,272	38.2%	5	6,044,171	$1,686
South Dakota	$1,575,212	39.0%	4	844,877	$1,864
Sources: United States Census Bureau, "State Government Finances: 2013," accessed April 4, 2016 United States Census Bureau, "State totals: Vintage 2013," accessed April 8, 2016 Note: Per-capita figures were generated by Ballotpedia by dividing total federal aid for the state by the estimated population of that state in 2013.

Spending

Estimated 2015 expenditures

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2015 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.^[2]

Nebraska's total estimated government spending in fiscal year 2015 was $11 billion, which was the second lowest amount when compared to surrounding states.

Total estimated state spending, FY 2015 ($ in millions)
State	State funds	Federal funds	Total spending	Population	Per capita spending
Nebraska	$8,074	$2,908	$10,982	1,896,190	$5,791.61
Iowa	$15,429	$6,335	$21,764	3,123,899	$6,966.93
Kansas	$11,161	$3,882	$15,043	2,911,641	$5,166.50
Missouri	$16,626	$7,495	$24,121	6,083,672	$3,964.88
South Dakota	$2,542	$1,347	$3,889	858,469	$4,530.16
Per-capita figures are calculated by taking the state's total spending and dividing by the number of state residents according to United States Census Bureau estimates.^[8] Source: National Association of State Budget Officers, "Examining fiscal 2013-2015 state spending," accessed April 4, 2016

Spending by function

Breakdown of spending by function in FY 2014.
Source: National Association of State Budget Officers

See also: State spending by function as a percent of total expenditures

State spending in Nebraska can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2014 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.^[2]

In fiscal year 2014, higher education accounted for 23.5 percent of Nebraska's total expenditures.

State spending by function as a percent of total expenditures, FY 2014
State	K-12 education	Higher education	Public assistance	Medicaid	Corrections	Transportation	Other
Nebraska	14.4%	23.5%	0.5%	17.6%	2.5%	7.6%	33.9%
Iowa	16.6%	26.7%	0.5%	20.9%	2.3%	7.2%	25.8%
Kansas	25.9%	17.6%	0.2%	22.4%	2.6%	11.4%	19.9%
Missouri	22.8%	4.8%	0.8%	35.8%	2.8%	8.5%	24.5%
South Dakota	14.0%	21.6%	0.7%	20.3%	2.7%	14.5%	26.3%
Source: National Association of State Budget Officers Note: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."^[2]

Spending trends

Between 2010 and 2014, the share of the Nebraska state budget spent on K-12 education decreased from 15.7 percent in 2010 to 14.4 percent in 2014. See the table below for further details (figures are rendered as percentages, indicating the share of the total budget spent per category).^[2]^[9]^[10]

Spending by function from 2010 to 2014 (as percentages)
Year	K-12 education	Higher education	Public assistance	Medicaid	Corrections	Transportation	Other
2014	14.4%	23.5%	0.5%	17.6%	2.5%	7.6%	33.9%
2013	14.6%	23.3%	0.5%	17.9%	2.2%	7.8%	33.6%
2012	15.3%	23.5%	0.5%	16.7%	2.3%	7.5%	34.3%
2011	16.3%	22.8%	0.6%	16.4%	2.3%	6.6%	34.9%
2010	15.7%	22.4%	0.6%	17.2%	2.3%	7.4%	34.4%
Source: National Association of State Budget Officers Note: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."^[2]

Fiscal year budgets

See also: Historical Nebraska budget and finance information

Fiscal years 2016 and 2017

See budget bill: Nebraska biennium budget summaries

Governor Pete Ricketts announced his biennium budget proposal on January 22, 2015. General fund spending was to be set at $4.26 billion in fiscal year 2016 and $4.36 billion in 2017. This includes $60 million each year in property tax relief, as well as reducing tax burdens on agricultural land owners and an increase in aid for public schools.^[11]

The official budget was signed in May 2015 and contained some of the tax relief programs recommended in the governor's budget. General fund spending equaled $4.27 billion in fiscal year 2016 and $4.4 billion in fiscal year 2017, both increases over fiscal year 2015 levels.^[11]

State debt

See also: State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Nebraska had a state debt of approximately $13.1 billion. Its state debt per capita was $7,081. In this report for fiscal year 2012, state debt was calculated based on four components: "market-valued unfunded public pension liabilities, outstanding government debt, unfunded other post employment benefit (OPEB) liabilities, and outstanding unemployment trust fund loans." The report revealed that altogether state governments faced a combined $5.1 trillion in debt, which amounted to $16,178 per capita in the nation.^[12]^[13]

Total 2012 state debt
State	Total state debt	State debt per capita	Per capita debt ranking
Nebraska	$13,139,045,000	$7,081	49
Iowa	$37,783,060,000	$12,290	38
Kansas	$39,025,693,000	$13,523	28
Missouri	$76,489,010,000	$12,702	34
South Dakota	$7,707,458,000	$9,249	46
Sources: State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014

Taxpayer burden

TIA Methodology: To figure a state’s taxpayer burden or surplus, TIA looked at a state’s total reported assets minus capital assets and assets restricted by law (buildings, roads, land, etc.) to calculate “available assets,” which were then compared to the amount of money the state owes in bills, including retirement obligations such as pension plans and healthcare benefits for retirees.

If the difference between available assets and total bills was positive, TIA called this a surplus; if it was negative, this was a burden. This amount was then divided by the number of individual tax returns with a positive tax liability, thus expressing the total state surplus or burden on a per-taxpayer basis.

According to a report released in September 2015 by the nonprofit Truth in Accounting (TIA), Nebraska ranked 6th best in the country in “taxpayer surplus.” Rather than using per capita state debt, TIA ranked states based on what it called a “taxpayer burden,” a term that reflects “the amount each taxpayer would have to send to their state’s treasury in order for the state to be debt-free.” On the other hand, states that had sufficient resources to pay their bills were said to have a “taxpayer surplus,” which represents the amount that each taxpayer would receive if the state were to disburse its excess funds.

Based on analysis of Nebraska’s Comprehensive Annual Financial Report from June 30, 2014 and actuarial reports for the state’s retirement plans, TIA concluded that $529.6 million in promised retirement benefits were unfunded, but only $941,000 of these liabilities were reported on Nebraska’s balance sheet. With all of the unfunded retirement benefits included in the total debt, the state had a surplus of $1.8 billion, or a taxpayer surplus of $2,800.^[14]

Public pensions

See also: Nebraska public pensions and Nebraska public employee salaries

Between fiscal years 2008 and 2012, the funded ratio of Nebraska's state-administered pension plans decreased from 91.3 percent to 78.5 percent. The state paid 91 percent of its annual required contribution, and for fiscal year 2012 the pension system's unfunded accrued liability totaled $2.4 billion. This amounted to $1,339 in unfunded liabilities per capita.^[15]^[16]

Credit ratings

See also: State credit ratings

Credit rating agencies, such as Standard and Poor's, assign grades to states that take into account a state's ability to pay debts and the general health of the state's economy. Generally speaking, a higher credit rating indicates lower interest costs on the general obligation bonds states sometimes sell to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). This in turn results in lower interest costs, thereby lowering the cost to taxpayers.^[17]^[18]

The table below lists the Standard and Poor's credit ratings for Nebraska and surrounding states from 2004 to 2014. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest.^[19]

State credit ratings, 2004 to 2014
State	2014	2013	2012	2011	2010	2009	2008	2007	2006	2005	2004
Nebraska	AAA	AAA	AAA	AAA	AA+	AA+	AA+	AA+	AA+	AA+	AA+
Iowa	AAA	AAA	AAA	AAA	AAA	AAA	AAA	AA+	AA+	AA+	AA+
Kansas	AA+	AA+	AA+	AA+	AA+	AA+	AA+	AA+	AA+	AA+	AA+
Missouri	AAA	AAA	AAA	AAA	AAA	AAA	AAA	AAA	AAA	AAA	AAA
South Dakota	AA+	AA+	AA+	AA+	AA	AA	AA	AA	AA
Source: Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014

Economic indicators

See also: Economic indicators by state

Nebraska's GDP increased by 0.7 percent in 2014. Click the image to view a larger version.

Broadly defined, a healthy economy is typically one that has a "stable and strong rate of economic growth" (gross state product, in this case) and low unemployment, among many other factors. The economic health of a state can significantly affect its healthcare costs, insurance coverage, access to care, and citizens' physical and mental health. For instance, during economic downturns, employers may reduce insurance coverage for employees, while those who are laid off may lose coverage altogether. Individuals also tend to spend less on non-urgent care or postpone visits to the doctor when times are hard. These changes in turn may affect the decisions made by policymakers as they react to shifts in the industry. Additionally, a person's socioeconomic status has profound effects on their access to care and the quality of care received.^[20]^[21]^[22]

In Nebraska, the median annual household income was about $55,107 from 2011 to 2013, which was highest among its neighboring states. The state had an unemployment rate of 3.6 percent in September 2014. Nebraska and its neighbors all had relatively similar economic indicators.^[23]^[24]^[25]^[26]

Note: Gross state product (GSP) on its own is not necessarily an indicator of economic health; GSP may also be influenced by state population size. Many factors must be looked at together to assess state economic health.

Various economic indicators by state
State	Distribution of population by FPL^* (2013)				Median annual income (2011-2013)	Unemployment rate		Total GSP (2013)^†
State	Under 100%	100-199%	200-399%	400%+	Median annual income (2011-2013)	Sept. 2013	Sept. 2014	Total GSP (2013)^†
Nebraska	11%	17%	36%	36%	$55,107	3.9%	3.6%	$109,614
Iowa	11%	18%	35%	36%	$53,364	4.5%	4.6%	$165,767
Kansas	13%	18%	34%	34%	$49,804	5.3%	4.8%	$144,062
South Dakota	11%	17%	35%	37%	$50,488	3.7%	3.4%	$46,732
United States	15%	19%	30%	36%	$52,047	7.2%	5.9%	$16,701,415
^* Federal Poverty Level. "The U.S. Census Bureau's poverty threshold for a family with two adults and one child was $18,751 in 2013. This is the official measurement of poverty used by the Federal Government." ^† Median annual household income, 2011-2013. ^‡ In millions of current dollars. "Gross State Product is a measurement of a state's output; it is the sum of value added from all industries in the state." Source: The Henry J. Kaiser Family Foundation, "State Health Facts"

Budget process

State documents and agenciesBelow are links to official Nebraska budget and financial documents. The first is the state's Comprehensive Annual Financial Report (CAFR). A CAFR is a detailed presentation of a government entity's financial condition. This includes fiscal activities and balances for a fiscal year. The second link is to the state's relevant budget agency or office.

The state operates on a biennial budget cycle. The sequence of key events in the budget process is as follows:^[27]

Budget instructions are sent to state agencies in July.
Agency requests are submitted to the governor by September 15.
On or before January 15, the governor submits his or her proposed budget to the Nebraska State Senate. The deadline is February 1 for newly elected governors.
The Senate adopts a budget in May. Two-thirds of elected members must vote for the budget in order for it to pass.

Nebraska is one of 44 states in which the governor has line item veto authority.^[27]^[28]

The governor is constitutionally required to submit a balanced budget. In turn, the legislature is statutorily required to adopt a balanced budget.^[27]

Agencies, offices, and committees

The following standing committee in the Nebraska State Legislature deals with budget and finance matters:^[29]

Appropriations Committee, Nebraska State Legislature

The Nebraska Auditor of Public Accounts office is responsible for independent, accurate and timely audits, evaluations and investigations of the financial operations of Nebraska state and local governments. Nebraska's audit reports are published online.^[30]

Transparency

See also: "Following the Money" report, 2014

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites were with regard to state government spending.^[31] According to the report, Nebraska received a grade of B- and a numerical score of 82, indicating that Nebraska was an "advancing" state in terms of transparency regarding state spending.^[31]

As published 2015

State finances in the U.S.

State tax policy in the U.S.
Pension Policy

State finances on the ballot Taxes on the ballot Glossary of state budget terms Public pensions

The information on this tab contains:

Spending (fiscal years 2013 and 2014)
Revenues (fiscal year 2013)
State debt (fiscal year 2012)
Federal aid to the state budget (fiscal year 2012)
Budget process

Between fiscal years 2013 and 2014, total spending in Nebraska increased by approximately $380 million, from $10.2 billion in fiscal year 2013 to an estimated $10.5 billion in 2014. This represents a 3.7 percent increase. The cumulative rate of inflation during the same period was 1.58 percent, calculated using the Consumer Price Indices for January 2013 and January 2014. As of 2014, financial services firm Standard and Poor's had assigned Nebraska a credit rating of AAA, the highest score available.^[32]^[33]^[34]

HIGHLIGHTS

As of 2014, Nebraska's state debt per capita was $7,081, the second-lowest in the nation.