Debate Transcripts

LB 1310 (1994)

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April 8, 1994


While the Legislature is in session and capable of transacting business, I propose to sign and do hereby sign LB 942, LB 1106, LB 1106A and LB 913.  LB 1013...LB 1310, excuse me.


CLERK:  Madam President, 1310, E & R amendments are the first item.


PRESIDENT ROBAK:  Senator McKenzie.  Senator Will.


CLERK:  E & R amendments, Senator.


SENATOR WILL:  Madam President, I move the adoption of the E & R amendments to LB 1310.


PRESIDENT ROBAK:  Any discussion?  Seeing none, all those in favor say aye.  All those opposed nay.  The E & R amendments are adopted.


CLERK:  The first amendment I have to the bill is by Senator Bohlke.  AM3855, Senator.


PRESIDENT ROBAK:  Senator Bohlke, to open on her amendment.


SENATOR BOHLKE:  Madam President, members, I wish to substitute AM4253.  (See pages 1828-29 of the Legislative Journal.)'


PRESIDENT ROBAK:  Any objections?  Seeing none, so ordered.  Senator Bohlke.


SENATOR BOHLKE:  Thank you.  This amendment does some very simple things; first, that it repeals Section 7 in the original bill and that was merely an assumption that there is a contract on file for teachers that...  in the state department.  We thought that contract...  the state department thought that was not being used by schools.  It was going to delete it.  We heard from the schools that some schools still use that, so it deletes that section.  The other amendment really deals with school passes and what the...currently we ...  or what we will do is 'Let any elected or appointed official, employee or volunteer of a district to qualify for a school pass.  What this amendment does is also includes...  allows passes to senior citizens groups, retired school employees and city officials.  And then, lastly, it also includes community college area boards may also issue the activity passes.  I will answer any questions.




PRESIDENT ROBAK:  Thank you, Senator.  Any further discussion of the Bohlke amendment?  Seeing none, Senator, do you wish to close?  She waives closing.  The question before the body is the adoption of the Bohlke amendment to LB 1310.  All those in favor vote aye.  All those opposed vote nay.  Have you all voted?  Please record.


CLERK:  26 ayes, 0 nays, Madam President, on adoption of Senator Bohlke's amendment.


PRESIDENT ROBAK:  The Bohlke amendment is adopted.  Mr. Clerk.


CLERK:  Senator Bohlke, I now have AM4157.


PRESIDENT ROBAK:  Senator Bohlke.


SENATOR BOHLKE:  I will withdraw that.


PRESIDENT ROBAK:  It is withdrawn.  Mr. Clerk, any further amendments?


CLERK:  Madam President, Senators Wickersham and Jones would move to amend.  (AM3798 appears on page 1561 of the Legislative Journal.)


PRESIDENT ROBAK:  Senator Wickersham.


SENATOR WICKERSHAM:  Thank you, Madam President.  This amendment has been printed in the Journal.  It is basically the contents of LB 923 with the addition of an amendment suggested by Senator BeutIer.  This is not a retirement bill and this is not a retirement amendment.  So if you've gotten used to me droning on about those things, you will have an opportunity to hear me drone on about something else for just a few minutes.  And what I want to talk about this morning on this particular amendment is school lands and Senator Chambers was confused when we had a handout passed around to you earlier.  He thought it was a poem.  It wasn't a poem at all, it has to do with the school lands that we have and the income that we receive from them.  I think, as you are all aware, we have had school lands, those are lands held in trust for the support of the common schools in the State of Nebraska ever since the initial date of statehood.  Originally, we had far greater lands than we have now.  We had about 2.8 dol ...  2.8 million acres originally.  We now have about 1.5 million acres left and you can see those detailed in the




handout.  Those...  and as you can see by the handout, the problem with what we have currently left as land assets are primarily devoted to pastureland; 1.2 million acres of pastureland is in our portfolio.  And I will use that word for the first time here in this discussion, but you need to remember that it is a portfolio, it's an investment portfolio, because we have an asset that we use to produce income, income for the common schools.  That is really the objective, to produce income but to do it in a safe and prudent fashion, to do it as a trustee, to do it with fiduciary responsibilities, and that is what the amendment is about.  The amendment is about that fiduciary responsibility to maintain or obtain the greatest possible income with the least amount of risk.  That is our fiduciary responsibility.  I don't believe we're discharging that responsibility with our current mix of real estate holdings in the trust.  We're not doing it because we are heavily concentrated in one kind of real estate, pastureland.  That kind of real estate also happens to have the lowest rate of return and the lowest value as a type of real estate in the State of Nebraska.  And when I say it has the lowest rate of return, that shouldn't surprise you, because it has the lowest value.  Rates and return in value go hand in hand.  If you have high values, you have high rates of return.  The amendment would simply allow the Board of Educational Lards and Funds to-sell some land, hold the proceeds and -%'-.hen reinvest them in other land.  Why is that a major change?  Because right now the policy is that if the Board of Educational Lands and Funds sells real estate, the proceeds go to the investment council and are invested in stocks and bonds.  They're not reinvested in real estate.  So very little real estate gets sold by the Board of Educational Lands and Funds and we're stuck with this lopsided investment portfolio.  The amendment, again, allows them to sell and to reinvest but to reinvest in a broad range of real estate investments and to do so balancing out rates of return and risk so that the maximum return is obtained.  Now Senator Beutler had suggested an amendment.  It changes the composition of the board.  It makes sure that we have one representative on the board from each of the current three congressional districts.  Right now, they're apportioned on the basis of four congressional districts.  And, in addition, Senator Beutler's amendment would require that we have one person with expertise in commercial real estate and one person with expertise in agricultural real estate.  Now, Senator Beutler, if you would like a few minutes here, I have just a brief amount of time left.  If you have any remarks, I will yield my time to you.




PRESIDENT ROBAK:  Senator Beutler.


SENATOR BEUTLER:  Madam President and members of the Legislature, I would certainly like to be supportive of this, what I view as a compromise solution to a "Longstanding nagging, agonizing, divisive issue of the educa.  ..of the school lands.  And the bottom line always, of course, is what does this do for the children of the State of Nebraska and the trust fund?  And that's where you have to begin and I think it's definitely positive from that point of view to give the trustee a wider flexibility and latitude in dealing with basically our portfolio for the children.  And so that's the one positive thing.  And the other positive thing is that it spreads...  it's going to spread out the educational lands and funds across the state, it's going to bring it into the cities.  And I think, in all fairness, to the urban people, you should understand that some of these commercial investments are going to be in your districts and that will spread out the burden.  But I think, in all fairness, that's what should happen and it's a reasonable compromise and I hope everybody can support it.  Thank you.


PRESIDENT ROBAK:  Thank you, Senator Beutler.  Mr. Clerk, we have an amendment to the amendment.


CLERK:  Madam President, Senator Withem would move to amend the amendment.  (FA541 appears on page 1829 of the Legislative Journal.)


PRESIDENT ROBAK:  Senator Withem.


SPEAKER WITHEM:  Yes, Madam President, and members of the body, I was at the hearing...  first of all, let me tell you what my amendment does.  My amendment simply puts an operative date on this section of July 1, 1 believe it is, of 1997.  That would give us an opportunity to look at this policy if we are going to implement it, get some reports back from the Board of Educational Lands and Funds as to how it would be implemented and what their goals and plans would be.  So that's what the amendment does.  Obviously, there's somewhat of an ulterior motive here that I don't really anticipate that we're going to get to a vote on my amendment on the amendment and then a vote on Senator Wickersham's bill.  Some ways I'm sorry that I'm doing this.  On the other way, on the other hand, consent calendar is a good tool to do noncontroversial, noncomplex items




that everybody really understands what we're doing and not take a lot of time.  I really do not believe the bill that Senator Wickersham is bringing to us that would cause a pretty radical shift in the way in which the Board of Educational Lands and Funds does its business is an appropriate item for consent calendar.  It's one, frankly, maybe as I understand it better, I would be supportive of.  There is some appeal to the changing the portfolio of lands that exist but I'm not sure how it 'would work and I'm not sure I'm comfortable with the Board of Educational Lands and Funds in effect becoming real estate speculators, selling some land, buying some land, who knows whether they're going to sell it, what the criteria will be.  I think the system that we now have is probably one that I'm more comfortable living with that until we have time for a much fuller discussion and explanation.  I'm not swayed much by the fact that there wasn't much opposition to this.  I think this is an idea whose time needs to come.  As you know, we've had a lot of controversy over the years about educational lands and funds.  This does not sell the land.  This does not change the distribution of it.  There are more contentious issues.  I may be back supporting this at a future (late but, at this time, I'm not very, very excited about doing it.- So that's what my amendment does is delays the implementation date.


PRESIDENT ROBAK:  Thank-you, Senator Withem.  Senator Monen, did you wish to speak to the Withem amendment?


SPEAKER WITHEM:  I was not completed, I wanted to yield some of my time to Senator Wickersham.


PRESIDENT ROBAK:  I'm sorry.  Thank you, Senator Withem.  Senator Wickersham.


SENATOR WICKERSHAM:  How much time is left?


PRESIDENT ROBAK:  One the bill, two minutes; for you, seven.


SENATOR WICKERSHAM:  Well, I think the agreement is here we're not attempting to kill this bill, so, Senator Withem, if you will withdraw your amendment, I will withdraw mine.


SPEAKER WITHEM:  I withdraw my amendment.


PRESIDENT ROBAK:  The Withem amendment is withdrawn.  The Wickersham amendment is withdrawn.  Are there any further




amendments to LB 1310?


CLERK:  Senator Wesely, I assume your motion ...  do you still want your motion, Senator?


SENATOR WESELY:  I'm going to withdraw this, but you don't try and adopt amendments like we've just had offered here on consent calendar.  And I've got a kill motion up on the bill, I'll ask for it to be withdrawn.  But we have to trust one another, when we've got consent calendar, not to try and-pull something like this.  So, please, let's be a little cautious.  Withdraw the motion.


PRESIDENT ROBAK:  Any further amendments on the bill?


CLERK:  I have nothing further on the bill, Madam President.


PRESIDENT ROBAK:  Senator Monen, do you wish to speak on the bill?  Senator Bromm, do you wish to speak on the bill?  Senator Jones, on the bill?  Senator Cudaback, do you wish to speak on the bill?  Any further discussion on LB 1310?  Seeing none, Senator Bohlke, do you wish to close?




PRESIDENT ROBAK:  The question before the body* is the advancement of LB 1310 to E & R engrossing.  All those in favor say aye.  All those opposed nay.  LB 1310 advances.  LB 1292.


CLERK:  LB 1292, Madam President, E & R amendments, first of all.


PRESIDENT ROBAK:  Senator McKenzie.


SENATOR McKENZIE:  Madam President, I would move the E & R amendments be adopted.


PRESIDENT ROBAK:  Any discussion?  Seeing none, all those in favor say aye.  All those opposed nay.  The E & R amendments are adopted.


CLERK:  Senator Landis has the first amendment, 3475.


PRESIDENT ROBAK:  Senator Landis to open on the amendment.