LINCOLN— Nebraska now spends more than $3 billion annually on property tax relief, accounting for roughly 47% of the state's more than $7 billion budget. Property tax relief spending has grown significantly, from about $1.6 billion in 2017, as lawmakers expanded programs including the Property Tax Credit Fund, Education Future Fund, Community College Future Fund and TEEOSA school funding. Despite the increased state support, total property taxes collected in Nebraska have continued rising, reaching an estimated $5.3 billion in fiscal year 2025.

The growing commitment to property tax relief comes as Nebraska faces increasing budget pressures. The state currently projects a $208 million deficit for FY2027 and an approximately $846 million shortfall in the following biennium, while cash reserves stand at more than $526 million. Gov. Jim Pillen and Appropriations Committee Chair Sen. Robert Clements argue Nebraska can continue providing tax relief by reducing government spending and using reserves when necessary. Critics, including OpenSky Policy Institute, warn that maintaining billions in property tax relief while revenues decline following recent income tax cuts could make balancing future state budgets increasingly difficult.

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