Omaha Public Schools weighs pay restraint after $50.6M aid shortfall

Omaha Public Schools is weighing smaller employee raises, reserve withdrawals and a possible higher property-tax levy as it develops a preliminary 2026-27 budget after a major reduction in state aid.

OPS says the district expects $50.6 million less in state aid for the coming school year. The reduction follows a Nebraska Department of Education calculation error involving the state’s TEEOSA school-funding formula. The district’s budget has not been adopted, and several proposed responses remain subject to public review and board action.

Why the state-aid reduction occurred

A December 2025 Nebraska Department of Education board report identified a miscalculation that resulted in an overpayment of more than $30 million to OPS. Nebraska Public Media and The Reader have reported the OPS overpayment at about $30.5 million.

A separate NDE state-aid comparison document shows that OPS received $339,402,887 in state aid for 2025-26 and is scheduled to receive $289,628,513 for 2026-27. That is a year-over-year difference of $49,774,374.

The two figures describe related but different parts of the district’s budget problem. OPS’s broader $50.6 million figure reflects the total state-aid impact used in its planning, while the NDE document shows the official difference between the prior year’s paid amount and the amount scheduled for the next year.

What OPS is considering

The preliminary plan includes smaller pay increases for employees and $27.5 million from district reserves. OPS also plans to eliminate its building-fund levy request for the year as it works to address operating pressures.

The district has indicated it may seek a property-tax levy near the statutory maximum of $1.05 per $100 of valuation, which would be roughly an eight-cent increase. That amount is not final. OPS expects certified property valuations on August 20, and the exact levy will depend on those figures and later district action.

Even with the state-aid reduction, OPS is projecting an overall budget increase of about $10 million, or 1.18%. That does not represent an increase in state aid or new discretionary money. The proposed growth is tied to costs including salaries, transportation fuel and maintenance, special education, utilities and possible funding for student bus passes after private funding ended.

What residents should watch

For property owners in the OPS district, the final levy could affect school-related tax bills, although the effect cannot be calculated until valuations and the adopted levy are known. Employees are being asked to accept smaller raises as one part of the district’s response.

Families should also watch for decisions involving transportation, student bus passes and services connected to special education. OPS says its planning process is intended to protect teaching and learning, but the final budget and any operational effects remain unsettled.

OPS held proposed-budget community presentations on July 21, July 23 and July 25. The next major public milestones are scheduled for September 10, 2026, at the OPS Teacher and Administration Center: a budget hearing at 5 p.m., followed by a board meeting at 6 p.m.

Those meetings are not described as final budget adoption in the current district calendar. The levy, reserve withdrawal, employee raises, bus-pass funding and other spending choices remain subject to additional information and board action.

Sources

• Omaha Public Schools budget presentation notice
• Nebraska Department of Education state-aid comparison
• Nebraska Public Media OPS budget report