Restrictions on government contracts proposed

The Government, Military and Veterans Affairs Committee heard testimony Feb. 22 on a bill that would allow a governing body to set a stricter standard when entering into contracts with its own employees or officials.

LB364, introduced by Lincoln Sen. Bill Avery, would allows a governmental body to prohibit contracts valued over a specified dollar amount in which a public official or a public employee may have an interest.

Avery said that governing bodies currently may enter into such contracts valued under $2,000 without a public bidding process, and over $2,000 if the contract is open for public bid.

While current law allows governing bodies to prohibit contracts with elected officials, he said, it does not provide a similar mechanism to limit contracts with other public officials and employees.

“It makes sense, I think, to allow local political subdivisions to decide how they want to handle contracts – not only with elected officials but also with public employees,” Avery said.

Jeff Kirkpatrick, deputy city attorney for the city of Lincoln, supported the bill, saying the city would like the ability to have a stricter standard for contracts with public officials and employees.

He said Lincoln should have the flexibility to limit contracts with city department directors or others who exert influence over employees in order to avoid the appearance of abuse of power.

“We realized that we couldn’t achieve that goal without a change in state statutes,” Kirkpatrick said.

Frank Daley, executive director of the Nebraska Accountability and Disclosure Commission, also supported the bill. He said many states simply prohibit contracts between government bodies and public employees, but that Nebraska would be better served by allowing greater flexibility in the contract process.

In many rural areas of the state, he said, the only source of certain goods and services that cities need to contract for might be someone who serves on the school board or city council.

“The approach in Nebraska has been that you can have an interest as long as you jump through certain hoops,” Daley said.

No one testified in opposition and the committee took no immediate action on the bill.