Nebraska’s economy has weathered the COVID-19 pandemic better than any state in the Union. 

According to Politico’s State Pandemic Response Scorecard, Nebraska’s economy ranks first in the nation. Nebraska continues to enjoy record low unemployment, and last fall the Department of Revenue reported that our state’s incoming tax revenues beat the projection of the Forecasting Board by 7.7%.

Despite our economy doing so well, the state of Nebraska has been given more than a billion dollars in federal funds to spend this year and next from the American Rescue Plan Act (ARPA).  Nebraska is slated to receive $520 million for 2022 and another $520 million for 2023, for a grand total of $1.04 billion.  

Because I have a seat on the Legislature’s Appropriations Committee, just how to spend this money is something that concerns me directly. The principles of fiscal responsibility have never been more relevant to our state than now.

Therefore, today I would like to tell you about the three most important principles of fiscal responsibility which should guide our lawmakers as they spend this money.

First, the guidelines for spending ARPA funds are very confusing and convoluted. Lawyers even have a difficult time deciphering the ARPA rules. If we do not carefully abide by the rules for spending ARPA funds, we may find ourselves in a position of having to pay the money back to the federal government.  The last thing Nebraskans need on their backs is the added burden of giving even more of their hard-earned money to the federal government. Therefore, the first principle I will follow is to make sure that all of our ARPA monies stay in Nebraska.

Second, ARPA funds need to be used for one-time expenditures only. Because we will not be receiving these federal monies year-after-year, ARPA funds should not be used to create new programs which will obligate state monies for years to come. Instead, ARPA funds provide our state with the unique opportunity to fix or upgrade those things which have deteriorated over the years. 

Third, ARPA monies need to be used to benefit the people of Nebraska, not government agencies. The primary purpose of these ARPA funds is to put Americans back on their feet and to help them recover from the ramifications of the COVID-19 restrictions.

Over the course of the past two years, many small businesses were forced to close their doors, people were laid off from jobs and struggled to make ends meet. Therefore, ARPA funds need to be used to help small businesses succeed, employ more Nebraskans, and provide relief to struggling families.

Lawmakers will need to practice fiscal restraint this year. Spending a billion dollars of other people’s money is a difficult task when the goal is to do it in a fiscally responsible way. My hope is that the Legislature won’t just view these ARPA funds as free money to spend on furthering their favorite government programs. 

Government money is never free. Whether we realize it or not, Americans will eventually have to pay back every dime that gets spent out of these ARPA funds. The U.S. national debt is nearing $30 trillion.  If Americans were to pay off their total indebtedness this year, every taxpayer would have to somehow come up with $238,534, according to the U.S. Debt Clock.

We need to remember that the federal money we spend today will have to be paid back by future generations of Americans. Therefore, we need to use these ARPA funds to grow our state’s economy so that future generations of Nebraskans will be able to live and thrive in our state.

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