Nebraska Governor Jim Pillen has restructured the state’s economic forecasting board by removing three members and replacing them with allies, including two former Republican state senators known for advocating major tax reductions. The changes occur as Nebraska confronts a third consecutive year of budget shortfalls and a projected $208 million deficit in 2027, compelling lawmakers to close the gap without increasing tax collections.
The Nebraska Economic Forecasting Advisory Board, established in 1984 to insulate revenue projections from political interference, now includes former State Senators Lou Ann Linehan and Tom Briese, both of whom played key roles in pushing through tax cuts that will lower the top income and corporate tax rates to 3.99% by 2025. Pillen also named Tim Wilson, an Omaha accountant with no prior legislative experience, to the board. This marks the first time a governor has replaced one-third of the board simultaneously, according to state records.
Board’s Role in Budget Forecasts
The board’s primary function is to project tax revenue, but its work holds outsized influence over Nebraska’s budgetary decisions. Michael Calvert, who directed the Legislative Fiscal Office when the board was created, described it as “essential” when operating correctly. The forecasts directly inform Pillen’s annual budget proposals, which he submits to the legislature in January following the board’s October projections.
Critics Warn of Partisan Forecasts
Opponents of the changes argue the new appointments introduce partisan influence into the board’s process. Sen. George Dungan, a Democrat on the Revenue Committee, labeled the move “concerning,” warning that political pressure could lead to forecasts that minimize the state’s financial constraints. Nebraska’s income tax collections fell by $703 million in 2023 compared to 2022, and lawmakers have already addressed two prior shortfalls by reducing program funding and drawing down reserves.
Linehan and Briese dismissed such concerns, insisting their decisions would be guided solely by data. Briese, a farmer from Albion, said he could “be true to the facts and to the data, regardless of what it might implicate or what it might call into question.” Linehan, who authored the tax cuts as Revenue Committee chair, said she is “not beholden to the governor.”
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Historical Battles Over Forecast Independence
The board’s history reflects past struggles with political interference. Before its creation, forecasts were often manipulated. In one documented case, officials allegedly destroyed a projection that would have required tax increases, then inflated estimates to avoid the issue, according to Tom Bergquist, a former fiscal office employee. The result was a “major fiscal crisis,” he said.
Former Gov. Bob Kerrey, a Democrat who helped design the board, criticized Pillen’s action as politically motivated. He said the burden is on Pillen “to prove that this isn’t a political move, to get the number that he wants.”
Among those replaced were Thomas Henning, a Kearney businessman who had served since 2014, and Leslie Andersen, a Bennington banker who joined in 2002. Board members must demonstrate expertise in tax policy, economics, or economic forecasting—a criterion the new appointees meet, though their legislative backgrounds contrast with the board’s traditional emphasis on business professionals.
The board’s consensus process incorporates projections from two state agencies: the Department of Revenue and the Legislative Fiscal Office. Both submit independent estimates before the nine-member board convenes to reconcile discrepancies and produce a unified forecast. The October release of these figures serves as the foundation for Pillen’s budget proposal, which lawmakers must balance without additional revenue.
Background on New Appointees and Former Board Members
Former lawmaker John Kuehn said he was surprised by his replacement and had received no notice from Governor Pillen’s office. Kuehn believed his term ended in September and planned to seek clarification at the October board meeting. Appointed in 2019, Kuehn was a former state senator and veterinarian, differing from the board’s typical business profile. He asserted he had taken extra effort to prove his independence after observers labeled his 2019 appointment political, emphasizing his impartial record.