8
In research aimed at ensuring that state budget decisions are based on evidence, and not educated guesses, Pew Charitable Trusts found that lawmakers in just eight states have access to two key analytical tools – long-term budget assessments and budget stress tests. In its report, Pew noted the importance of sustainable state budgeting in a time when record surpluses resulting from the COVID-19 public health emergency led to record-setting tax cuts that could threaten state revenues in the long term, such as the income tax cuts passed last spring in LB 754.
In its analysis, Pew included Nebraska among the 20 states to publish at least one of the two analytical tools identified as key to measuring risk and anticipating potential shortfalls, citing the biennial Revenue Volatility Report compiled by the Legislative Fiscal Office in 2022. The report suggests that Nebraska lawmakers sustain a Cash Reserve Fund balance of 16% of projected General Fund revenue as a cushion to absorb 4% revenue shortfalls over consecutive years.
Policymakers drew substantially from the state’s cash reserves during the recent legislative session. Nebraska’s Cash Reserve Fund balance is now projected to drop to 13% of annual expenditures by the end of FY25. It began the biennium at 24.3% of annual revenues.
Read report from Pew Charitable Trusts
Download OpenSky’s overview of Nebraska Budget and Tax Policy
Follow OpenSky on Twitter for updates from Monday’s Tax Rate Review Committee meeting
2,481
Passed in 2020, the state’s newest economic incentive program – the ImagiNE Act – has led to agreements with 50 companies pledging to create 2,481 jobs and invest $1.55 billion in Nebraska. The agreements were documented as part of an annual report to the Legislature on the state’s business incentive programs. These programs will cost the state an estimated $112 million in tax refunds and credits in the current fiscal year, and an additional $118 million in FY25.
Those refunds and credits are a drain on revenues necessary to support schools, health care and other state programs without a comparable boost to the economy. Last year’s report found that the Advantage Act – legislation that predated ImagiNE – provided $93.4 million more in tax breaks than in tax revenue generated.
Read story from Nebraska Examiner
Read report to the Legislature on Business Tax Incentives
58,930
In the first six months of Medicaid eligibility reviews, 58,930 Nebraskans have lost their health insurance coverage through Medicaid. That’s nearly 1 in every 3 Nebraskans reviewed during the “unwinding” of federal COVID-19 continuous coverage protections that began this spring. The “unwinding” will continue through April for the 200,000 Medicaid recipients in Nebraska with eligibility reviews still pending.
Nationwide, 10 million people have been disenrolled from Medicaid since expiration of the pandemic-era requirement that extended coverage. Based on its tracking, KFF estimates that 71% of those disenrolled lost coverage for procedural reasons, such as not completing the renewal process, rather than ineligibility for the program.
View information on Medicaid renewals from Nebraska Appleseed
3%
A majority of voters in Santa Fe, New Mexico, went to the polls this month intent on addressing the need for more affordable housing. Voters overwhelmingly approved a 3% excise tax on the cost of homes exceeding $1 million. As a result, an estimated $4.5 million in annual tax revenues will be directed to the city’s Affordable Housing Trust Fund which aims to help those being priced out of the local housing market. The so-called “Mansion Tax” also helps to balance the tax system which in many ways tilts in favor of the wealthy.
Read more from the Santa Fe Reporter
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