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Gov. Heineman Returns Budget Maintaining Emphasis on Nebraska's Key Priorities

Press Release

Location: Lincoln, NE

Today, Gov. Dave Heineman returned the Legislature's proposed state biennium budget for Fiscal Years 2013-2015. The budget remains focused on the vision for Nebraska's future that the Governor has emphasized throughout his terms: education, growing the state's economy and rebuilding the state's cash reserve fund. The Governor issued approximately $44 million worth of line-item vetoes to trim the budget that was returned to his desk from the Legislature.

"Today, I signed into law the state budget that is focused on the priorities of educating our children, growing the state's economy and rebuilding the state's rainy day fund," said Gov. Dave Heineman. "While I outline in detail the differences that I have with the Legislature's budget, I want to emphasize that we are in agreement on the majority of funding issues, and I have used limited line-item vetoes to merely trim the budget in a manner that is more responsible for the taxpayers."

Gov. Heineman and the Legislature have agreed to include a tuition freeze for the University of Nebraska and Nebraska State Colleges. Gov. Heineman proposed a two-year budget that included the funding necessary for the university and state colleges to freeze tuition for Nebraska students for two years. The Legislature agreed to the funding recommendation helping the university and state colleges freeze tuition for Nebraska students attending UNL, UNK, UNO, UNMC, Chadron State, Wayne State and Peru State for the 2013-14 and 2014-15 school years.

In addition, Gov. Heineman proposed 5 percent annual increases for State Aid to Education and Special Education for each of the next 2 years. Under this budget, State Aid would increase from its current level of $852 million to approximately $940 million in Fiscal Year 2015.

"Education is the great equalizer and education is one of our state's top priorities. We invest in education because we know how important it is," said Gov. Heineman.

Regarding general projects included in the budget, there is funding for a new Central Nebraska Veterans Home. While the project is at its inception, the Governor, a veteran himself, said, "Having a new, modern facility to care for our veterans is important. This new veterans home will serve those who have served our country, protecting our freedoms."

One of the reasons why Nebraska fared far better than most states during the national economic slowdown was that Nebraska had a robust cash reserve, which was utilized in the state's budget during the slowdown. Now that Nebraska is again poised for growth, it is important to rebuild the depleted reserve fund. This budget estimates the rebuilding the cash reserve from its current $384 million to $627 million in Fiscal Year 16-17.

"I want to acknowledge the work of the Appropriations Committee and the more extensive discussion the Legislature had on the budget this year. Building a budget can be difficult and challenging, and maintaining these priorities will keep Nebraska moving forward."

Gov. Heineman vetoed approximately $28 million in state and federal funding for Fiscal Year 2014 for a new Medicaid computer system. The Department of Health and Human Services should focus on implementing the federal health care law and providing better support services for ACCESSNebraska. By delaying the process of designing and building a new Medicaid computer system for one year, the state will be better prepared to successfully implement this computer project.

Gov. Heineman vetoed a 70 percent increase in mass transit funds in order to increase road construction funding by $4 million, a higher priority use of gas tax dollars. The Governor noted that Nebraskans will be better served by using this funding for road work.

Gov. Heineman vetoed nearly $3 million for the next two years to the University of Nebraska for the College of Nursing Building -- Lincoln Division. The Governor noted that the savings realized from the University of Nebraska's Veterinary Diagnostic Center should be returned to the general fund and not used to rationalize an additional project requiring even greater appropriations than was previously saved.

Gov. Heineman vetoed a total of $1.4 million in general funds for renovation of the Nebraska History Museum because these amounts exceed the appropriation needed to fund the Nebraska State Historical Society's estimated project costs for necessary building repairs. After the veto, the $4.5 million in general funds and $2 million committed to this project will be sufficient to address issues of deferred maintenance, failures in the original building systems, and fire code and Americans with Disabilities Act compliance.

Gov. Heineman vetoed a total of $544,000 from the Capitol Commission for building improvements. After the veto, the Commission will have new appropriations of the same amount for ongoing improvement projects in the Capitol Building. In addition, it is estimated the Commission will carry-over an estimated $240,000 of unobligated appropriations on June 30, 2013.

Gov. Heineman made additional line-item reductions to the Legislature's decision to (1) reinstate previous budget reductions; (2) replace one-time funds or depleted federal funding with ongoing state general fund support; (3) provide special or oversized increases to certain programs and employees; or (4) to initiate new programs.

The additional line-item reductions are outlined in the LB 195 veto message and include previously proposed increases in funding for the Department of Health and Human Services, the Postsecondary Coordinating Commission, the Public Service Commission, the State Auditor, the Supreme Court, and other agencies.

The total amount of vetoes for the budget bills is $44.6 million, which includes $200,000 for an Omaha golf tournament. The general fund vetoes total $7.8 million.

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