The Legislature's Appropriations Committee, after hours of negotiation and discussion, will recommend that the University of Nebraska, and state and community colleges take a 1 percent cut in the 2018-19 fiscal year, rather than the 4 percent cut proposed by Gov. Pete Ricketts in his budget.
In addition, the committee will recommend state agencies get 2 percent cuts across the board rather than the proposed 4 percent.
In separate votes, five members of the committee — Sens. Kate Bolz, Anna Wishart, Robert Hilkemann, Tony Vargas and chairman John Stinner — voted in favor of rolling back the cuts for higher education in 2018-19 to 1 percent and for agencies to 2 percent. Those voting against the change were Sens. Dan Watermeier, Robert Clements and John Kuehn.
Budget cuts in the current fiscal year would remain at 2 percent, as Ricketts proposed.
The committee recommendation is tentative, given that the Nebraska Economic Forecasting Advisory Board will meet next week, and the amount of money predicted to be available to the state could change. The committee also must convince the full Legislature to accept the recommendation.
The committee was tasked this week with wrapping up recommendations on its 2017-19 two-year state budget. But on the big issue of cuts to higher education, it struggled to find agreement.
After meeting Thursday and voting on a couple of options, with no majority agreement, the committee met twice Friday to find a consensus on one of five options suggested by committee members.
Kuehn jested with the committee after no decision was reached in the first 90-minute session:
"This is chaotic, and I've been to a goat roping," he said.
Here are the options the committee considered:
* Make no cuts in either the present fiscal year or next year;
* Keep 2 percent cuts in this fiscal year and make no cuts next year;
* Make 2 percent cuts both this year and next year;
* Keep 2 percent cuts this fiscal year, and make no cuts to the state colleges next year, but cut the NU system and community colleges by 2 percent next year;
* Cut the colleges and university by 2 percent this year and 1 percent next year.
Stinner would have preferred to 2 percent cuts across the board in both years, for both higher education and state agencies.
"I was willing to compromise," Stinner said. "Obviously, the ... majority of the committee made up their mind that higher education was a high priority."
And 4 percent cuts would be too tough for the state agencies to absorb, he said.
"It's a pretty big drop from where they've been," he said.
With this recommendation, given other decisions on the budget, the state's cash reserve is predicted to drop below $250 million, the amount with which Stinner said he is most comfortable. He's hoping for a positive turn in predicted tax collections when the forecasting board meets.
Kuehn, who voted against lowering the university cut to 1 percent, said the committee needed to be mindful of other policy decisions that may be looming, including the possibility of a successful property tax ballot initiative creating a $1.2 billion obstacle to revenue or spending.
He would have preferred the cut be 2 percent rather than 1 percent, he said.
"I don't believe that the university is in as dire of a circumstance for a whole host of reasons," he said, "looking at all their fund options and availability."
At a hearing earlier this month on the proposed budget cuts, university officials put on what looked to some committee members as a full-court press. Wishart said in her time in the Legislature, including as a staffer before being elected, she has never seen the amount of contacts in emails and calls from the public on any other issue.
"This is a very important institution to the state. I think it would be hard to find someone who doesn't have family or friends who are touched in a positive way by this institution," Wishart said.
NU President Hank Bounds said at the hearing the state's financial support of higher education was a moral issue. He asked senators to consider the consequences of the plan put forward by Ricketts.
In that plan, NU would lose $11.4 million in state aid by June 30, as well as $23.2 million next year, forcing the university to cut programs and people and consider significant tuition hikes to close a budget gap estimated at $69 million.
With Friday's recommendation, the loss in the second year to the NU budget would be $5.8 million, for a total loss over two years of $17.2 million.
In making their case to the committee, state college leaders said colleges in Wayne, Peru and Chadron are essential to workforce development and Nebraska’s rural economy, and continued reductions would weaken the schools’ foundations.
Bounds said Friday's vote was a positive step that signaled chairman Stinner and a majority of committee recognize the importance of higher education to the future of the state and economy.
"We thank them for their leadership in making all of higher education and the students we serve a priority," he said. "We look forward to continuing to work with the committee and the full Legislature in the months ahead to ensure affordable, excellent higher education for the people of Nebraska.”