Nebraska now faces a projected $101.6 million budget shortfall despite a surge in tax collections, largely because of a new tax credit for property owners that grows when state tax revenues increase, state officials said last Thursday.

The revenue boost will mean a bigger tax credit for homeowners and a record-high rainy-day fund for the state, but a tighter general fund budget. The numbers were released at a legislative budget meeting.

Nebraska ended its fiscal year last month with $5.959 billion in tax collections, nearly $1 billion more than projected.

But under state law, all of the excess money will be split between property tax credits and Nebraska’s rain-day cash reserve. The tax credit is slated to grow at a pace that will reduce Nebraska’s general-fund balance from $27.4 million above its required minimum reserve to $101.6 million below.

Sen. John Stinner, chairman of the Legislature’s Appropriations Committee, said the shortfall will likely be reduced or erased the next time state revenue projections get updated. He said lawmakers should remain cautious, however.

Sen. Lou Ann Linehan of Omaha questioned why officials didn’t anticipate that revenue might surge, given all the federal stimulus money for states.