Senators override Gov. veto of state claims

Senators voted April 3 to override a gubernatorial line-item veto of a provision in the state claims bill.

LB1072, introduced by the Business and Labor Committee as part of the Legislature’s budget package, approves claims exceeding $50,000 authorized by the state claims board.

Senators approved the measure March 27 on a 42-4 vote. Gov. Dave Heineman subsequently vetoed a provision approving 50 claims totaling $2.5 million made by subcontractors of Boys and Girls Home – a former lead contract agency with DHHS that since has declared bankruptcy.

In his veto letter, the governor said the subcontractors were not directly engaged in a contract with the state of Nebraska and that paying them would make taxpayers responsible for debts incurred by a private organization.

Furthermore, Heineman said, payment of subcontractor claims would violate the Nebraska Constitution by creating a closed class and appropriating funds based on a moral obligation rather than a state responsibility.

Omaha Sen. Steve Lathrop, chairperson of the committee, filed a motion to override the governor’s veto, saying the state has a responsibility to pay the claims because the providers rendered services required by law.

“The state of Nebraska has a statutory duty to provide these services and to pay for them,” he said. “We need to pay our bills; it’s that simple.”

Sen. Tom Carlson of Holdrege agreed. When the state takes custody of a child, he said, a legal obligation is created to pay for the services that the child requires. Further, he said, the state ultimately is responsible for oversight of all contracts in the child welfare system.

“I believe we must make it right with these subcontractors,” he said. “It’s the right thing to do and it’s never wrong to do the right thing.”

Norfolk Sen. Mike Flood opposed the override motion, saying the state had fulfilled its contractual obligation by paying Boys and Girls Home the amount the agency was owed. The failure of Boys and Girls Home in turn to pay their subcontractors created a “miserable situation,” he said, but not a legal obligation on the part of the state.

Senators voted 31-12 to pass LB1072, notwithstanding the objections of the governor. Thirty votes were necessary to do so.