With the federal stimulus money running out this year, the state is facing a budget shortfall.
The Nebraska department of education will be affected.
Governor Heineman met with Nebraska superintendents Wednesday to discuss the state school budget for the next two years.
At 1.4 billion dollars, the projected budget shortfall is the largest in Nebraska's history.
School districts are mulling their options.
Virgil Harden, the director of business for Grand Island public schools, says "Within the first month of January of next year we will have probably a public announcement of what things are on our cutting block..".
The governor expects sacrifices from everyone.
He even suggested the superintendents take a pay freeze just to be fair.
"We've already negotiated with the unions for next year. A zero percent pay increase followed by a 2 percent the following year.", says Heineman.
Despite the shortfall, Governor Heineman says the budget can be controlled if the growth of spending is cut.