Budget bills clear final round

Lawmakers approved two budget measures Aug. 20 intended to help offset a future shortfall in funding for a property tax relief proposal passed during the special session.

LB2, introduced by Elmwood Sen. Robert Clements at the request of Gov. Jim Pillen, makes adjustments to the state budget that was finalized in the recently concluded regular legislative session.

The bill reduces reappropriated general funds — also known as carryover funds — by $82 million across more than 40 state agencies in the current fiscal year and FY2024-25.

LB2 also lowers general fund appropriations by $41.46 million. In total, the proposal reduces funds available to state agencies by approximately $120 million.

The measure passed on a vote of 33-11.

LB3, also introduced by Clements at the request of the governor, authorizes and provides for fund transfers, changes certain fund transfer provisions and changes application of investment earnings.

Among other provisions, the bill eliminates the crediting of accrued interest to more than 40 state agency cash funds. Those dollars instead will be directed to the state’s General Fund.

The bill is projected to increase state revenue by $22 million in 2025, $80 million in 2026 and $71 million in 2027. It also states legislative intent to transfer $200 million to the General Fund from the state’s Cash Reserve Fund in 2027 if needed and if funds are available.

Lawmakers passed LB3 on a 36-9 vote. Both bills will take effect immediately after being signed by the governor.