State finances reflect political priorities, economic realities

By Lexie Heinle | April 27, 2015

Nebraska lawmakers have a challenging legislative term ahead as they attempt to prepare a balanced biennial budget, a state constitutional requirement. Unpredictable economic events can play havoc with states' budgets, according to 20 years of state finances from the United States Census Bureau. Additionally, Nebraska governors have their own political goals.

State finances from 1993 to 2013 demonstrate their budgets' variability, especially revenues. In 2009, the Great Recession's effects were clearly shown in a revenue drop. Although revenues are more volatile, unexpected increases in spending can lead to budgets in the red. Even when adjusted for inflation, Nebraska expenditures have increased 60 percent from 1993 to 2013, while revenues increased 83 percent in the same time period.

Dividing the 20 years into governors' terms displays the changes in Nebraska spending categories from one governor to the next. The table below displays the percent changes in each expenditure category for the terms of governors Ben Nelson, Mike Johanns and Dave Heineman. The largest change was a 50 percent cut in hospital funding during Gov. Nelson's term.

Nebraska spending Gov. Nelson Gov. Johanns Gov. Heineman
Education 15% 7% 17%
Public Welfare 22% 49% 7%
Hospitals -50% 16% 7%
Health 28% 18% 31%
Highways 6% -19% 3%
Police protection 8% 9% -1%
Corrections -20% 34% 6%
Natural Resources 26% -10% 14%
Parks and Recreation -20% 0% 33%

This visualization shows how revenues from sales tax, property tax and income tax have changed during governors' terms. The table below displays the percent changes in each tax category for governors Ben Nelson, Mike Johanns and Dave Heineman. The largest percent change was a 57 percent increase in sales tax revenue during Gov. Johanns' term.

Taxes Gov. Nelson Gov. Johanns Gov. Heineman
Sales -17% 57% -8%
Property 2% 24% 25%
Income 26% 2% 26%