One reason for the lack of criticism for the state budget proposed by Gov. Dave Heineman is that it was overshadowed by his proposal to eliminate the state income tax.
Another reason is that Heineman’s proposed budget is relatively generous, calling for an average annual increase in spending of 4.9 percent. By way of comparison, the rate of inflation last year was 2.1 percent.
A closer examination confirms that there is more to like than to dislike in the governor’s proposed budget.
Hit the books
The governor already had revealed a major item in his proposed budget by announcing the agreement with the University of Nebraska and state colleges for a two-year tuition freeze in return for a substantial increase in state aid.
The Journal Star editorial board earlier bestowed kudos for the plan, which will make college more affordable and create more opportunities for young Nebraskans.
The boost in aid did not come at the expense of state funding for K-12 education. Under the governor’s budget, state aid to schools would go up by 5 percent each year. In addition, state funding for special education would go up by 5 percent, which Heineman said will benefit rural schools which are likely to see funding shift to urban areas under the formula used to calculate state aid.
Sock it away
The governor’s proposed two-year budget also would add money to the state’s rainy-day fund. The value of a substantial cash reserve was demonstrated during the recent recession, when the governor and Legislature used it to help plug shortfalls in state revenue. According to the governor’s projections, the cash reserve would grow from $384 million to $442 million after the two-year budget cycle.
Caring for veterans
Heineman is proposing $47 million for the state’s share of a new $121 million Central Nebraska Veterans Home. The current facility in Grand Island is antiquated; it probably should have been replaced years ago. Military veterans who have served our country and defended our freedoms deserve better.
One area where lawmakers might consider increasing spending is in programs to strengthen the child welfare system, which has been in turmoil since the plan to privatize the system collapsed. Where can they get that money? See below.
The governor’s budget predicts that it will cost the state $72.3 million during the next two years to implement the federal Affordable Care Act. The governor said those projections were based on a report from Milliman Inc. Other analysts, however, said those estimates were too high.
The Appropriations Committee has a new chairman. Sen. Heath Mello of Omaha replaced Sen. Lavon Heidemann, who left because of term limits. Luckily for Mello, he will start the year in a relatively comfortable position.