Bills would move AG’s environmental settlement fund

The Judiciary Committee heard testimony Feb. 15 on two bills that would change the distribution of funds received from certain out-of-court settlements, court orders or judgments.

Under LB728, introduced by Omaha Sen. Heath Mello, Supplemental Environmental Project (SEP) funds received by the attorney general’s office from settlements and payments for violations of Nebraska environmental laws instead would be remitted to the state treasurer for distribution exclusively for the use and support of schools.

The bill also would require that the Legislature be able to review the funds and appropriate them for allowable legal purposes.

Mello said he learned of the SEP funds when the attorney general’s office announced via a December 2011 press release that $100,000 from the fund was being awarded to a group called We Support Agriculture. Based on information gathered by state offices, Mello said, the SEP fund does not exist in statute and was created without legislative approval.

“For many Nebraskans, [that announcement] was the first we had learned of this fund’s very existence,” Mello said. “My underlying concern is that there be an unbiased, transparent procedure in place to authorize these grants.”

LB777, introduced by Malcolm Sen. Ken Haar, would require that SEP funds be transferred to the Nebraska Environmental Trust Fund for distribution.

Haar said that he, too, had only recently learned of the fund’s existence and was troubled by the allocation.

“I do not think this process was transparent and that is what bothered me,” he said.

Haar said it would make sense to direct the funds to the Nebraska Environmental Trust Fund, given that it was acquired for violations of environmental laws.

Jerry Hoffman, a representative from the Nebraska State Education Association, testified in support of LB728, saying state settlement money should be allocated to common schools to ensure they are funded adequately.

“We believe this is a significant way to help to achieve that,” Hoffman said.

Ken Winston, a representative of the Sierra Club in Nebraska, testified in support of LB777, and said he was concerned about the process used to grant the funds. The attorney general’s office awarded a grant almost instantaneously to a group that had existed less than three months, Winston said, while other conservation organizations had applications pending for months with no response.

“We think that conservation projects often are unfunded or funded at lower levels than they should be,” Winston said, “and if there is a fine for an environmental purpose then it should be given to the [environmental] trust.”

Chief Deputy Attorney General David Cookson testified in opposition to both bills, saying the funds go through the state accounting process where they are all accounted for. Furthermore, Cookson said, statutory cases fall within the attorney general’s discretion and not the Legislature’s.

“The bills are asking us to do something we believe is unconstitutional,” he said.

The committee took no immediate action on the bill.