Nebraska

State Budget Practice Report Cards and Budget Resource Guide

Nebraska won an A average, the top grade, for fiscal 2015 through 2017 for its avoidance of budget maneuvers and deft handling of legacy costs, two of the five budgetary categories evaluated by the Volcker Alliance.

The state’s record on budget maneuvers showed that Nebraska successfully avoided deferring recurring expenditures, shifting costs and revenues from year to year, funding recurring expenditures with debt, and using asset sales and up-front proceeds of financial transactions to achieve budgetary balance.

Nebraska was also one of eight states earning an A average for legacy cost practices. The category includes public worker pensions and other postemployment benefits, principally retiree health care. The Nebraska Public Employees Retirement Board, which administers the state’s pension plan, uses a conservative funding formula that led it to put $44 million into the plan’s fund in fiscal 2016, even though state actuaries had determined that slightly less than $30 million would have been sufficient.

The state received a B in transparency in each of the three years studied. Along with all other states except Alaska and California, it lost points for failing to disclose deferred infrastructure replacement costs. While Nebraska averaged a B in budget forecasting, its grade was affected by a need for midyear budget adjustments in 2016 and 2017 and a lack of multiyear expenditure forecasts for all three years evaluated.

Nebraska fared least well in its use of reserve funds, where it earned only a C average. Although the state has statutory requirements for governing its rainy day funds, Volcker Alliance analysts found the rules weren’t sufficiently clear for Nebraska to get a B.

Download Printable State Report Card

To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.

The report cards presented here are taken from the 2017 Volcker Alliance report, Truth and Integrity in State Budgeting: What Is the Reality? which proposes a set of best practices for policymakers. For those wishing to gain greater insight into state fiscal issues, the accompanying budget resource guide is derived from the Alliance publication State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses (2016). 

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