Gov upbeat in State of the State address

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January 13th, 2011

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Lincoln, NE – Governor Dave Heineman’s proposing some economic development initiatives, holding the line on education, and cutting health care payments.

Gov. Dave Heineman struck a positive tone in his 2011 State of the State address (Photo courtesy State of Nebraska)

If you hadn’t heard of the projected $1 billion shortfall in the upcoming state budget, you might not have picked up on it from the governor’s upbeat speech. The positive tone started early on.

“Today I am proposing a bold, innovative and strategic two-year budget and a four-year vision to make Nebraska to create jobs and grow a business, the best place to obtain an education for students of all ages, and the perfect place to raise a family.”

Heineman’s $7 billion state spending proposal includes about $17 million for new internships, grants, site development and tax credits for businesses, and $25 million toward the University of Nebraska Lincoln’s innovation campus on the old State Fairgrounds. The governor wants to hold other higher education funding flat, along with state aid to schools in the first year. That would mean an overall loss to schools of about $140 million with the ending of federal stimulus funds. But some federal aid remains, and the governor’s proposing $50 million more state dollars in the second year. Some of the biggest proposed cuts would come in health programs, where Medicaid payments to some doctors, hospitals and others would be cut 5 percent. Heineman anticipates criticism.

“If special interests want to be critical,” he said, “then they need to present their own plan. If they want to spend more on Medicaid, then the question is do they want to reduce education funding, or raise taxes?”

Gov. Heineman accompanied by First Lady Sally Ganem at the 2011 State of the State address (Photo courtesy State of Nebraska)

Overall, the governor’s proposal eliminates the projected $ 1 billion gap using about $300 billion in revenue, mostly from the cash reserve, and about $700 million less in projected spending, mostly in education and health. Now the Legislature and everyone else gets to weigh in.

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