Nebraska lawmakers have taken a step toward closing the state’s budget deficit by advancing a bill that would adjust contribution rates to the Statewide School Retirement Plan. Legislative Bill 645, introduced by Sen. Beau Ballard of Lincoln on behalf of Gov. Jim Pillen, cleared the first round of debate on a 38-0 vote. The bill aims to generate approximately $77 million in budget relief by lowering retirement plan contributions from teachers, school districts, and the state, depending on the plan’s funding level.
The legislation has drawn criticism from opponents like Sen. Danielle Conrad of Lincoln, who argue the process is rushed and the changes risky amid economic uncertainty. She voiced concern that lawmakers are using teacher retirement to balance the state’s $289 million deficit. However, supporters—including the Nebraska State Education Association—back the amended version of the bill, which would reduce teacher contributions when the plan is over 100% funded, effectively raising take-home pay for many educators.
Currently, teachers contribute 9.78% of their salary to the retirement plan. Under the bill, that rate could drop to 7.25% if the fund is over 100% funded or rise to 9.75% if it drops below 96%. The plan is now 99.1% funded and projected to reach 100% next year.
An additional amendment to lower the retirement age and increase cost-of-living adjustments is scheduled for a hearing on April 23 and was not included in Thursday’s vote. Sen. Ballard said pushing the bill forward now was necessary to keep the legislative session on track, while Speaker John Arch acknowledged concerns about timing but said some compromises are inevitable in a compressed session.
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