New Forecast, Same Problems

Halloween weekend brought plenty of scares, but perhaps the most frightening came Friday, when Nebraska's Economic Forecasting Board raised itsprojected budget deficit for 2028-29 to $1.2 billion. Revenue forecastedfor 2026-2027 was improved but not enough to save the state from the impendingobstacles to come.

In 2026-2027, much of this increasecame from forecasted individual income taxes that rose to around $2.84 billion. This left a total revenue projection of around $6.805 billion, a $23.2 million increas from the last forecast. However, this increase will not allow much wiggle room.According to the Nebraska Examiner, Keisha Patent with the Legislative Fisca Office, stated the $23 million increase in revenues for 2027 automatically go to the state's cash reserve. 2027-2028 was not nearly as positive with a totalof $6.795 billion, a decrease from the previous year. 2028-2029 had a similar outlook at $6.985 billion, a $276 million dollar decline from previousprojections.

So where does this leave Nebraska? In yet another deficit.

This deficit is not likely to be fixedby a simple cut in smaller projects and slight reductions in government. Closing the budget gap entirely would require economic development on a large scale and at a rapid pace. The budgetcannot be fixed with a single solution. It will likely take a mix of all theseoptions to create a sound budget. This deficit may bring sweeping changes tothe size of government, tax increases, or ceased funding to large projects(state-funded projects, of course). A hard push to bring in more manufacturing,agricultural industry, and economic development are a necessary strategy. Harddecisions and potential changes to Nebraska residents' tax bills are on thehorizon.

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