Budget debate begins

Lawmakers began debate May 7 on the state’s budget package. The state budget is structured on a two-year basis, with the budget enacted during legislative sessions held in odd-numbered years.

As introduced, the Appropriations Committee’s $7.8 billion budget proposal would result in a financial status at the end of fiscal year 2014-15 that is $41.3 million more than the 3 percent minimum reserve.

Senators ended the last session with a projected $619 million shortfall.

Appropriations Committee chairperson Sen. Heath Mello of Omaha said elimination of the projected shortfall would result from a combination of cash fund transfers, lapses of prior year carryover appropriations and lower than projected increases in the budget.

He said the committee’s proposal assumes passage of legislation that would partially negate projected increases in the state aid to schools formula (TEOSSA) and state obligations for defined benefit retirement plans.

The Appropriations Committee’s budget package comprises eight bills, two of which were advanced May 7: LB196, which would provide for the $12,000 annual salaries of Nebraska’s 49 state senators, and LB197, which would fund salaries and benefits for judges and constitutional officers. Both bills advanced to select file 44-0.

Senators started debate on the mainline budget bill, LB195, and resumed discussions May 8.

A Mello amendment to a pending committee amendment, adopted 37-0, proposed a TEOSSA funding reduction of $8.6 million, which Mello said was adjusted in light of a compromise that was achieved on LB407, the school funding formula bill.

Omaha Sen. Jeremy Nordquist spoke in support of the budget package. He said increased funding across the entire continuum of education in Nebraska reflects the right priorities.

“This budget really focuses on investment in the future of our state, an investment in education,” he said.

The second day of debate focused on several amendments offered to LB195.

Omaha Sen. Bob Krist offered, and later withdrew, an amendment that would have inserted language into the bill stating the Legislature’s intent that the state Department of Aeronautics establish a preventative maintenance fund and a replacement fund for any state-owned aircraft purchased after May 1, 2013.

Planes are expensive investments, Krist said, and if the executive branch is going to own one, the state needs to be sure that sufficient funds are set aside to maintain it.

“An airplane is a hole in the air in which to throw money,” he said.

Sen. Scott Price of Bellevue offered, and later withdrew, an amendment that would have reduced funding to the Omaha Learning Community from $725,000 to $650,000 per year. He said the amendment would bring funding back in line with the committee’s original recommendation made in the preliminary budget.

Price said the type of wrap-around services being provided to parents in conjunction with some early childhood education programs seems to fall outside the state’s constitutional requirement to offer free education to those under 21.

“Why do we use education dollars that are raised … through property taxes for people over the age of 21 in our common schools?” Price said.

Mello opposed the amendment. He said the governor’s original proposal was to cut funding to the learning community to $500,000, or approximately 40 percent less than their level of funding in the previous state budget.

After hearing testimony at a public hearing, he said, the committee decided that the cut was too large. The $750,000 appropriation still reflects a 17 percent cut to the learning community budget, Mello said.

“That still may impact programming … but we wanted to mitigate the impact on early childhood educational programming,” he said.

Omaha Sen. Beau McCoy offered, and later withdrew, an amendment that would have eliminated $150,000 per year to the state Department of Natural Resources’ (DNR) Soil and Water Conservation Program. He said the funds are designated for contract with the University of Nebraska – Lincoln (UNL) for climate change studies.

Mello opposed the amendment, saying the current program at the High Plains Regional Climate Center at UNL will no longer be gathering Nebraska-specific data.

As a result, he said, moving $150,000 from the Interrelated Water Management Program to the department’s operations budget would allow the DNR to contract with UNL to continue gathering that data.

The funds would not be utilized otherwise, Mello said, because the water management program is no longer funding new projects.

Sen. Dan Watermeier of Syracuse supported the amendment, saying several current water projects would be shortchanged unless funds are made up elsewhere.

“[We would have] to replace this funding with local occupation taxes and property taxes,” he said.

McCoy offered a second amendment that would strike the requirement that the DNR contract with the High Plains Regional Climate Center for data collection.

He said the Legislature should not dictate to the department what entity to contract with for the data.

Mello opposed the amendment, saying that UNL is a known entity in the state that is capable of supplying the data.

“I’ve yet to hear a reason why they shouldn’t be using the University of Nebraska High Plains Regional Resource Center,” he said.

The amendment failed on a 10-31 vote.

An amendment offered by North Platte Sen. Tom Hansen would eliminate $250,000 in each year of the biennium to fund the state’s nurse visitation services program.

Hansen said the funding originated from provisions introduced in LB234, sponsored by Omaha Sen. Sara Howard.

Hansen said the program currently is funded at $850,000 per year. While the program is worthwhile, he said, it is has not been established long enough for lawmakers to know if it should be expanded.

“This program is not old enough to warrant a 30 percent increase,” he said.

Howard opposed the amendment, saying the program assists young, at-risk parents across the state in an effort to reduce child abuse and neglect in a cost effective manner.

“These are families that, without support, are very likely to enter the child welfare system,” she said.

Howard said agencies in the program leverage every $1 they receive from the state into $7 from other funding sources, including federal and private dollars.

Lincoln Sen. Danielle Conrad also opposed the amendment, saying early intervention is key to child abuse prevention. She said 68 percent of parents in the program reported an improved ability to cope with stress.

“This program is not about duplication [of other services],” Conrad said, “but rather the opposite. It’s about filling a void in our social safety net.”

The Hansen amendment failed on a 7-29 vote.

Debate continued into the evening. Several amendments are pending to LB195.