Nebraska now faces $101.6 million shortfall in state budget

nebraska capitol.jpg
Posted at 5:09 PM, Jul 22, 2021
and last updated 2021-07-22 18:09:44-04

LINCOLN, Neb. (AP) — Nebraska now faces a projected $101.6 million budget shortfall despite a surge in tax collections, largely because of a new tax credit for property owners that grows when state tax revenues increase.

The boost in revenue will mean a bigger tax credit for homeowners and a record-high rainy-day fund for the state, but could mean a tighter general fund budget.

The numbers were released at a meeting between legislative leaders and budget officials. Nebraska ended its fiscal year last month with $5.959 billion in tax collections, nearly $1 billion more than projected. But under state law, all of the excess money will be split between property tax credits and the state’s cash reserve, also known as the rainy-day fund.