Dr. Ken Mahlin

The purpose of this study is to investigate the impact of the Budget Limit Act of 1979 on Nebraska Class II school district budgets by examining spending and revenue collecting trends during two time frames. The study examines five expenditure variables: (1) total district expenditures; (2) instruction; (3) operation/maintenance of plant; (4) transportation; and (5) average cost per pupil. The four revenue variables examined are: (1) property taxes; (2) state aid; (3) county receipts; and (4) annual ending cash balances. The major findings of this study are that: (1) the cost per pupil, using constant dollars, continued to increase during the limited time frame, but the rate of increase was lower; (2) the rate of increase for revenue collecting was lower during the limited time frame, but the rate of increase exceeded the 7% annual limit allowed by the law for three of the six limited years; (3) the rate of increase for total spending was lower during the limited time frame, but the rate of increase exceed the 7% annual limit implied by the law for four of the six limited years; and (4) three expenditure variables (instruction, operation/maintenance of plant, and transportation) held a higher percentage of total spending during the limited period than during the non-limited period. In conclusion, it appears that: (1) the impact of the Budget Limit Act of 1979 on Nebraska Class II school systems was minimal; (2) local boards of education were able to acquire necessary funds; and (3) the local boards of education were in legal compliance with the law, but were able to exceed its limits by using provisions in the law.