State aid to counties for certain federal judgments advanced

Lawmakers gave first-round approval April 29 to a bill that would provide state general funds to counties to pay certain federal judgments.

LB103, sponsored by Sen. Myron Dorn of Adams, would appropriate $2 million in general funds in fiscal year 2021-22 and FY2022-23 to any county that has a judgment against it from a federal court of more than $25 million, if the total cost of the judgment exceeds 20 percent of the county’s annual budget.

Funds appropriated under the bill could be used only for payment of a qualifying judgment.

An Appropriations Committee amendment, adopted 36-2, would direct the funds to the state treasurer for distribution through a program that provides aid to counties. It also would require that an eligible county set its property tax levy at the maximum for each year that it receives the aid.

The committee amendment also would have increased the appropriation to $5 million per year for two years. Dorn offered an amendment, adopted 35-3, that retained the original amount.

Dorn said the proposal is intended to help the residents of Gage County. In 2016, a federal judge awarded more than $28 million in damages to the six men and women wrongfully convicted of the rape and homicide of a Beatrice woman in 1985. The individuals, commonly known as the “Beatrice Six,” sued Gage County in federal court after DNA evidence exonerated them.

Lawmakers passed a bill in 2019 allowing the county to impose a sales and use tax of 0.5 percent on transactions within the county to help speed retirement of the judgment.

More than 30 percent of the county’s property tax revenue currently goes toward paying the federal judgment, Dorn said. Estimates are that it will take the county nearly four years to pay off the remaining $16 million, he said, adding that many people who are paying these taxes were not alive when the original crime happened.

“Gage County has exhausted every financial resource available to the county and the taxpayers,” Dorn said. “The county and its residents have done everything fiscally possible to pay this federal judgment.”

Omaha Sen. John Cavanaugh supported the proposal. He said the weight of responsibility for the Beatrice Six should be borne at least partially by the state.

“We’ve created a structure that over-prosecutes [and] over-incarcerates people and often we aren’t forced to see the cost of that,” Cavanaugh said, “This situation is one where it is very explicitly put out as a cost that people can easily comprehend — it’s $28 million for the years of those people’s lives who were wrongfully convicted.”

Senators voted 35-3 to advance LB103 to select file.