By GRANT SCHULTE
LINCOLN, Neb. (AP) - Nebraska Gov. Pete Ricketts signed a new two-year budget on Wednesday that includes $408 million for property tax reductions and lower-than-average state spending growth.
The Republican governor approved the $8.7 billion package without vetoes, saying it met the general goals he proposed at the beginning of this year’s session.
“This budget is a good step in that direction,” Ricketts said during a news conference at the Capitol. “This is a great day for Nebraska taxpayers.”
The budget includes an increase in state aid for property tax reductions, education and prison expenses. The $408 million approved by lawmakers and the governor will go to Nebraska’s property tax credit fund, which uses state money to offset local property taxes.
The package would grow state spending by an average of 3.2 percent annually over the next two years, although that number could rise slightly with new spending bills that pass this year. Nebraska’s state budget has historically grown by an average 5 percent per year.
Ricketts said he still believed lawmakers had work to do to lower property taxes.
The governor had also endorsed legislation to lower the taxable value of farm and ranch land, but the idea stalled amid arguments that it would either shift the cost to residential property owners or deprive school districts of revenue.
The package would add millions for state K-12 school aid, prisons and a 3 percent funding increase for the University of Nebraska, state colleges and community colleges.
Under the budget, the K-12 school aid formula will receive a 4.3 percent increase in state funding in the upcoming fiscal year and a 0.8 percent increase in the year that follows.
The Department of Correctional Services will get roughly $2.5 million in additional funding per year to hire 59 more security staff members, and $1.2 million for 14 new behavioral health positions.
The items were approved amid concerns that the prison lack services for inmates. Lawmakers added the money before a prison disturbance earlier this month that left two prisoners dead. Some of the inmates had complained prior to the revolt that the prison wasn’t offering enough rehabilitation programming.
Sen. Heath Mello of Omaha, chairman of the Appropriations Committee, said the budget included the priorities that the governor and lawmakers shared.
“The fiscal blueprint prioritizes growing Nebraska’s economy through responsible investments, and begins to address key challenges facing our state,” Mello said.
Senators were spared from having to make major cuts after a revenue forecast in April showed that the state will likely collect more than expected.
The state’s forecasting board projected last month that revenue will grow 5 percent during the fiscal year that starts on July 1 and 4.3 percent in the following year. Prior to the board meeting, many lawmakers had speculated that state revenues would decline and force them to trim the budget to avoid a deficit.
Ricketts had initially proposed adding $400 million to the property tax credit fund, but the higher forecast allowed lawmakers and the governor to increase the total by $8 million.
Lawmakers also voted to withdraw about $28 million from the cash reserve fund to pay for renovations to the Capitol’s heating, ventilation and air conditioning system. The full project is expected to cost $106 million, including the expense of restoring windows, moving Capitol offices across the street and a more efficient geothermal heat pump system. The withdrawals would take place over eight years.