State Budget Practice Report Cards and Budget Resource Guide
Nebraska was one of only eight states to average an A in legacy costs for fiscal 2016 through 2018. Its annual contributions to its public worker pension system were in line with actuarial determinations, and the plan had 90.2 percent of the assets needed to meet promised benefits as of 2017—almost 22 percentage points over the US total. Because Nebraska offers minimal health benefits to public worker retirees, it does not face the long-term unfunded liabilities—or the need for advance funding—for postemployment costs that most other states do.
The state’s lowest mark was a C average in reserve funds. Nebraska failed to tie reserves to revenue volatility, and even though a cash reserve is mandated by statute, there are no clear guidelines for use of the funds.
While Nebraska’s mark in budget maneuvers fell to a B in 2018 from an A in 2016 and 2017, it averaged an A for the three years studied. The 2018 drop was caused by the use of $61.2 million in one-time transfers to the general fund from special funds. They included $15 million from the Roads Operations Fund, $20 million from the Medicaid Intergovernmental Transfer Trust Fund, and $9 million from the Game and Parks Capital Maintenance Fund. A few transfers were made in 2017, but they were not large enough to lower the state’s grade in the category that year.
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 found here contain grades of the state's budgetary practices during the fiscal years of 2016 through 2018. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eight US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.