PD Guides

Unfunded Mandates Policy Guide


The issue of unfunded and underfunded mandates passed down from higher levels of government to lower levels is not new. Over the decades, Nebraska has made little to no progress on unfunded and underfunded mandates and has even added new ones. Meanwhile, the state continues to point to local government as a reason our property taxes are high, while each year adding to the financial burdens with new mandates.

In Nebraska state statute, a political subdivision includes villages, cities of all classes, counties, school districts, learning communities, public power districts, and all other units of local government. Dillon’s Rule construes grants of power to localities very narrowly. If there is a question about local government’s power or authority, the local government does not receive the benefit of the doubt. Their power is granted in the express words of our state statutes. Consequently, when the Legislature places an unfunded mandate on our counties, schools, community colleges, natural resources districts, etc., they have few options when it comes to paying for those mandates outside of raising property taxes. Our state takes no responsibility when it comes to the role it plays in property taxes being so high across Nebraska. If we are unwilling to address unfunded mandates or curb the state’s use of them moving forward, we face leaving municipalities, counties, and school districts with even fewer funds available to address the cost the Legislature forces them to incur.


Underfunded and unfunded mandates permeate many aspects of our political subdivisions. Local governments are responsible for maintaining roads, jails, space for state services, and providing education. In recent years, the Legislature passed legislation requiring additional training or instruction that did not include additional funding or a reduction in requirements for schools. This includes dating violence training, substance abuse teaching, return-to-learn protocols for students, and suicide awareness and prevention training. These are all very worthy and important issues facing students in schools, which is why legislation was introduced and passed. However, the Legislature has not funded most of these initiatives, instead relying on school districts to provide the services and training without reimbursement. Changes in curriculum require expenditures by school districts, which involves teachers choosing and vetting materials, alignment to state standards, and development as a curriculum guide and corresponding assessment tools. This requires either paying certified staff for additional hours during the summer or providing substitutes for them during the school year in addition to the purchase of classroom materials to fulfill the curriculum requirements.

Nebraska presently ranks 47th in the percentage of local government support that comes from the state. Nebraska ranks even lower, 49th, in the level of K-12 support that comes from the state. Low state support has resulted in localities relying more heavily on property taxes to fund services of which they are required to provide by the state. Data from 2001-02 to fiscal year 2014-15, the last year this information was available, show Nebraska localities growing increasingly reliant on property taxes. County governments in particular saw their property tax reliance grow, especially in the years following the elimination of direct state aid to localities. Increasing state aid to lower property taxes was the top recommendation by the 2013 Tax Modernization Committee. In the absence of increased state aid, prohibiting unfunded mandates for new or increased levels of services should relieve some pressure on budgets of our state’s local government. There need to be assurances that any mandate passed going forward needs to be adequately funded by the state.

As long as most can remember, Nebraska has had grandiose plans that were allegedly going to lower property taxes, but the Legislature has never fixed the underlying systemic issues that keep our property taxes high. Instead, the Legislature points to local government as the reason we have high property taxes. 


TAX REFORM/RELIEF (2022). We believe the Legislature should remove unfunded mandates on local governments to reduce spending and create efficiencies.

  1. Should there be a statute or constitutional prohibition on the Nebraska Legislature from imposing any financial responsibility for new programs or increased levels of service under existing programs on any political subdivision?
  2. Should this be a high priority for Nebraska Farm Bureau (NEFB)?
  3. How should NEFB lead with solutions in this space?
  4. Who are our partners in eliminating unfunded and underfunded mandates?

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