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Preliminary Budget Review Suggests Hard Decisions Need To Be Made

By Reagan Connelly
For several months, Jefferson County Commissioners have warned the community that this year’s budget may require some hard decisions. Inflation, the increased cost of fuel and increased wages to combat an ongoing staffing shortage has resulted in skyrocketing costs across the board for the county.
Commissioner Mark Schoenrock has noted on multiple occasions, “Nobody wants us to raise taxes, but nobody wants services cut, either.”
Commissioners have encouraged public input in the budget process.
On Tuesday, July 26, Brian Blobaum, CPA, of Blobaum and Busboom PC met with commissioners for a preliminary budget discussion. Blobaum and Busboom PC are the accounting firm that Jefferson County consults with when preparing the budget.
“The way we put the budget together is that we wait until the end of the year so that we have a final listing of the receipts and expenditures from the prior year,” Blobaum said. “And we ask each of the department heads and county officials to fill out their portions of the budgets for the coming year.”
Blobaum said with this information his company provides the commissioners with the ‘first draft’ of the budget if property tax isn’t changed. This ‘first draft’ will tell the county how short they might be at the end of the year.
Blobaum added that if property taxes are not raised then his company will go through the preliminary budget to see where the county could possibly cut back on spending.
Once the budget is prepared using the receipts from the previous year, Blobaum and Busboom PC must figure out how to pay for all of it. “So, we say ‘well here’s the amount of property tax we are going to use to pay for this’ and then when the property tax can’t handle all of that, then we say ‘ok we’re going to take money out of the inheritance fund,’” Blobaum said.
Blobaum said the largest concern with dipping into the inheritance fund is that at any time the legislature could take it away and more than that, they have tried to in the past.
Earlier this year, the legislation passed Legislative Bill (LB) 310, which cuts inheritance tax. Governor Ricketts has made reducing property taxes a hallmark of his administration. Some fear the inheritance tax cut could have the opposite effect. Opponents of the bill testified before the legislature that the loss of inheritance tax revenue could possibly mean counties would be forced to raise property taxes to make up the difference.
Previously, the first $40,000 of the inheritance is not taxed. Anything above $40,000 in value was subject to a one percent inheritance tax.
“They have changed a law on it in this past year where beginning next year, the exemptions for Nebraska Inherited Tax have increased from a $40,000 exemption to $100,000,” Blobaum said. “So those things are going to have an effect on how much inheritance tax is coming in and who knows where it’s going to go next.”
Blobaum said that they cannot always depend on inheritance tax to cover their expenditures.
He added that this year’s budget is going to be tighter than last year’s. “We’re $900,000 worse than we were a year ago in the budget,” he said.
But overall, Blobaum said it is too early to definitively say anything. “It’s even too early to say there is anything to say.”
On Tuesday, August 2, Commissioners met with various department heads for further budget discussions. Commissioners meetings are open to the public.

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