LINCOLN, Neb. — Nebraska lawmakers advanced another key piece of the state’s two-year budget Monday, approving a series of funding changes after hours of debate.
Following passage of the main appropriations bill, LB261, senators turned their attention to LB264, which focuses on transferring money to and from various state agency cash funds. The bill advanced after a four-hour floor debate that included several amendments.
One of the most significant changes came from Sen. Bob Hallstrom, who proposed restoring $4 million each to the Rural Workforce Housing Fund and the Middle Income Housing Investment Fund. The original budget plan would have redirected that money to the state’s General Fund in an effort to help balance the budget.
Hallstrom argued the cuts would jeopardize more than $12 million in rural housing projects already approved across 13 legislative districts. To offset the restoration of funding, his amendment instead schedules an $8 million transfer from the state’s Affordable Housing Trust Fund to the General Fund in 2026.
Hallstrom acknowledged concerns about the long-term impact of that shift but said maintaining momentum in rural housing development was essential.
Sen. Danielle Conrad opposed the amendment, warning that urban areas like Lincoln and Omaha—where the Affordable Housing Trust Fund is more commonly used—would feel the brunt of the cut.
“I’m not convinced this is a net gain for housing,” Conrad said during the debate. “This appears to paper over a budget gap by cutting into affordable housing funding.”
Despite the criticism, lawmakers voted 26-5 to adopt the amendment.
Senators also approved amendments that redirected money from the Nebraska Litter Reduction and Recycling Fund and increased transfers from the state’s Cash Reserve Fund to the General Fund.
LB264, along with other key budget measures, must clear one final round of debate before heading to Gov. Jim Pillen for consideration.