LINCOLN — Nebraska lawmakers will likely have to contend with two separate budget deficits when they reconvene for the 2027 legislative session, with the combined shortfall currently set over $1 billion.

Legislative Fiscal Analyst Keisha Patent confirmed the situation at a Tax Rate Review Committee meeting on Wednesday. There, she provided lawmakers with a new financial status report, showing a $208 million deficit projected for the ongoing two-year budget that runs through June 30, 2027, and a $864 million projected deficit for the next biennium spanning from July 1, 2027 to June 30, 2029.

Lawmakers spent the 2026 session working to fill a fluctuating shortfall that hit its peak at roughly $646 million — the second consecutive session the Nebraska Legislature has dealt with a budget deficit. They ended the session with a $6 million surplus that was erased before the session officially ended due to monthly tax receipts that fell below economic forecasts. Since then, three additional months of tax receipts came in below forecasts, leading to an estimated deficit of $223 million. Patent said the estimation changed to $208 million primarily because of standard accounting adjustments that cover transfers that are authorized in state law.

Gov. Jim Pillen has indicated that he does not plan on calling a special session on the budget, instead issuing a memo earlier this month announcing a 5% spending reduction across all state agencies. If fully implemented, this would create roughly $276 million in savings per fiscal year, according to Pillen spokeswoman Laura Strimple.

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