Debate Transcripts

LB 1219 (1998)

Select File

April 1, 1998


...Would you please stand and be welcomed by your Legislature.  We appreciate everybody coming to the Legislature this morning.  We hope you feel welcome.  While the Legislature is in session and capable of transacting business, I propose to sign and do hereby sign LB 320, LB 320A, LB 695, LB 695A.  We'll next move to Select File, 1998 Speaker major proposals.  LB 1219.  Mr. Clerk.


CLERK:  Mr. President, the first item, Senator Bruning, Enrollment and Review amendments.


SPEAKER KRISTENSEN:  Senator Bruning, you're recognized for a motion to adopt the E & R amendments.  (See AM7240 found on page 1524 of the Legislative Journal.)


SENATOR BRUNING:  Mr. Speaker, I move we adopt the E & R amendments for LB 1219.


SPEAKER KRISTENSEN:  You've heard the motion.  All those in favor of adopting the amendment say aye.  Those opposed say nay.  They are adopted.


CLERK:  Mr. President, first amendment I have to the bill, Senator Dierks, AM4143.  (AM4143 is found on pages 1459-63 of the Legislative Journal.)


SPEAKER KRISTENSEN:  Senator Dierks, you're recognized to open on your amendment.




SENATOR DIERKS:  Thank you, Mr. Speaker.  The amendment this morning that I have on the bill is one that I had on General File and I agreed to withdraw that from General File and put it on Select.  It's a very simple amendment.  It allows those members of a, Class I district who, at this point, -.have no authority to, ...  to draft their own budget, it allows them the opportunity to vote for a tax increase among their own taxpayers if that's what they would like to do.  It's very simple,-:  Simply allows the Class I school district to vote themselves; a pay increase or a tax increase to pay for education in their own district.  This is outside or above and beyond anything that their own Class II or III district does simply on their own.  Thank you.


SPEAKER KRISTENSEN:  Debate on the amendment.  Senator Bohlke.


SENATOR BOHLKE:  Yes, Mr. Speaker and members, I rise in opposition to this amendment and I think those of you who have Class I's and high ...  the high schools that are affiliated with the Class I's should listen carefully because what this does is by allowing the Class I's to go outside the vote and exceed the levy and then if the high school has to come back and ask for an override of the levy it is much less likely, if' it has been successful for the different Class I's, to override the levy, it may make it impossible for that high school district when they need to ...  to have a successful vote to override the levy.  And, in fact, if this amendment is adopted I would assume that high schools would be less likely to give that amount of budget authority that the Class I's would like if Class I's have the ability to go outside on their own and exceed the levy.  And so I think this probably works counter to everything that I've heard in trying to get the high schools and Class I's to work together.  An d so I'll try to answer any questions you may have, but certainly this should be a concern for you if you have Class I districts in your particular district and certainly then for the rest of us as a matter of state policy.  And so for that reason I rise in opposition to the Dierks' amendment.


SPEAKER KRISTENSEN:  Senator Wickersham.


SENATOR WICKERSHAM:  Hello?  Thank you, Mr. Speaker.  Senator Dierks brings to us an issue that, on its face, I would love to




be able to vote for.  I would love to be able to keep things the way they always were and to allow those folks to maintain their schools and pay as much as they wanted to for them.  I would love to turn back the clock.  I would love to repeal the common levy which I think was a terrible mistake by this body.  I would love to undo a lot of other things that I think have been very harmful to the Class I schools.  But there is a paradox I think in what Senator Dierks is proposing and the paradox.  is that, while this may seem on its face something you would want to do for the Class I schools if you have sympathy for those individuals, I don't think it's going to work out that way.  I think what the Dierks amendment does is actually put those folks in a position where they will constantly be placed in a position -to override or to have special elections to levy and that they will be paying a great deal for that privilege because the high school district will not allocate to them at all if they're in a Class VI system or if they're in a class...  if they're affiliated, that certainly the incentive at the high school levy level will be to allocate as little as possible.  And if you remember the formula that's adopted, there is a floor at least for the affiliated systems.  There is no floor in the Class VI systems.  So Senator Dierks' amendment actually allows or produces an incentive, in my view, for the high school district to allocate as little as possible to a Class I or nothing to, a Class I and tell them to go override.  That means that the Class I patrons would pay not only for their school but then they would pay absolutely as much as the high school district chose to levy within the $1.10.  They could wind up paying very, very high taxes.  Now maybe you want to make the argument that that's what they want to do, they want to pay, but I can't see placing in statute an incentive to cause others to put them in that position of paying and paying and paying.  I can't see doing it.  I'm sorry, Senator Dierks.  I wish I could support your amendment.


SPEAKER KRISTENSEN:  Senator Robinson.


SENATOR ROBINSON:  Mr. Speaker, members of the body, I stand to oppose the Dierks amendment.  We're going to have ...  we're going to have one set of rules for Class I's on this side and then we're going to have another set of rules on Class I's on this side.  I don't think that's the way we should do it.  I think it




should be as it was brought up last year, as we set it last year I think and that's the way it should be.  Because we're...we're favoring some Class I's but not the others, and I think we did, it the right way last year.  Thank you.




SENATOR JONES:  Mr. President, members of the body, this is, really a touchy issue out in my area.  I probably got more Class I's than anybody else and they keep telling me that they don't know how this is all going to come down from the'' affiliation districts and just how it's all going to work out, and they would just love to have their budgeting authority back.  And I guess I was really upset when the common levy passed.  In fact, I even had a bill in to try to repeal it twice and it got held in committee once and we kept trying to work it out and it finally come out that we ...  what really actually come out of it is the very sparse and sparse out of it situation.  But we got two different situations out there.  We got the Class VI systems and now we got the affiliation districts.  I guess I needed to just ask Senator Dierks a couple questions to get it on the record, if you don't mind.






SENATOR JONES:  Yes, Senator Dierks, if these Class I's would.  hold a election to get them more money, they are affiliated with, the K-12's.  Would the money that they raise, would part of that go to the K-12 as because they're a affiliated district, or how do we separate that?  I guess that's what I'm concerned about.


SENATOR DIERKS:  No, it's perceived that those dollars would be assessed in their district and be spent in their district.


SENATOR JONES:  And so if they're affiliated with that district they would still be affiliated without ...  with this passed?


SENATOR DIERKS:  Well, I mean that there the dollars would be raised in the affiliated part of the district and the...




SENATOR JONES:  So part of their money that they'd raise would go to the K-12 then?


SENATOR DIERKS:  No, just...  it would stay in their own K-12 or K-6 or K-8, or whatever it is,...


SENATOR JONES:  Yes, I understand.


SENATOR DIERKS:  ...  school.


SENATOR JONES:  Okay.  Well, thank you.




SENATOR JONES:  Well, I ...  I don't know how this is all going to wash down.  I know a couple on the Education Committee's already talked against it, but I would be hard pressed to go back home and say that I can't support something like this because I got to do all I can to Class I's because I got so many of them.  So I'm going to stand in support of Senator Dierks' amendment and I hope we can get a little more discussion on it and maybe change some more minds.  Thank you.




SENATOR BROMM:  Thank you, Mr. Speaker and members of the Legislature.  I hope that Senator Dierks and others know that this is a very difficult amendment for me to take a position on.  Senator Wickersham I think probably articulated a lot of the same thoughts that I would have.  I have concluded that the time has come that schools must look at themselves as part of a system and that the system must function cooperatively and in good faith with each other.  A short-term answer might be for the high school district to put it to the Class I or for the Class I to take advantage of whatever they could take advantage of budgeting-wise, but in the long run, in three years, five years, that's not the answer.  And I didn't support the common levy when it came in.  In fact, I think there were several of us that fought that fairly strenuously.  But it came in and it's there.  The courts have upheld it in a rather significant decision, BO I think that's there.  And with the background of




the common levy and with my feeling that schools have got to act in good faith with each other then I ...  then I think that we have to hold off on this amendment.  I would say this though, that if there is significant evidence or some evidence that school systems are not acting like systems", and that ...  that the high school district isn't showing the appropriate consideration for the funding of the Class I and the students that must attend that Class I, that we, as a Legislature, are incumbent...  it's incumbent upon us to revisit that issue, and I mean that.  Now, we haven't had ...  we haven't had the levy limitations in effect or the requirement of the budgeting process that was put in in (LB) 806 long enough, in my view, to scrap it and...  and to go back to the potential increased property taxes for the property owners in the Class I, as this amendment would allow.  So it's with a great deal of reluctance but also understanding of where this amendment is coming from that I'm going to have to vote no at this time, but I, if I am here and if the situation appears in the future that it's grossly unfair, I will certainly try to help revisit the subject matter.  Thank you.




SENATOR SCHROCK:  Mr. Speaker, members of the Legislature, Senator Dierks presents me with a perplexing problem this morning, whether to vote for this proposal or against it.  I have concern when a K-12 system votes to override the levy because farmers are impacted the most taxwise.  I think you can go to any K-12 system in the state, regardless of their size, and you'll find that farmers, who own the majority of the valuation in that school district, are the most impacted and yet they probably don't have the numbers to control the vote when it comes to levy overrides.  I believe I probably have a Class I with that same situation.  And it's my hope that the class I's and the...  and their primary districts will work together and try and become more efficient, and 1 think that can take place and evidence points to the fact that that will take; place.  But it takes cooperation.  It takes communication.  And so, although I have a concern that the Class I's may not have quite adequate funding, I think at this point in time I'm going to trust that they will cooperate with their primary district and will solve their funding needs, and vote against this at this time.  Because I also have some concerns that farmers could, even in




some Class I's, be forced to pay higher property tax to support schools when they are in the minority of the district.  And I...keep in mind, I represent other people besides farmers, but they are the big taxpayers in rural Nebraska and the economy in rural Nebraska is not that great right now.  So, from that standpoint, Senator Dierks, I think I'll vote no.  I hope you understand.  I think it's an issue that needs to be discussed.  Maybe another day I'd feel different but today I guess I think I'll vote red on this issue.




SENATOR JONES:  Mr. President and members of the body, just a couple more things I was thinking about and Senator Bromm kind of brought them up and...  and I don't think there's going to be enough votes to even think about this today, but I think this is something that we don't want to just forget about.  A year down the road and we see that they are having problems and they are hurting, and I think we better be able to revisit the issue and try to work something out with them, because that's where a lot of our number one kids in the state comes out of and we got a lot of the Class I's in my district that are out there by necessity, not out there just because they want to be, and they sure going to have to have some money to keep them going.  And I...I'm still going to go ahead and vote for Senator Dierks amendment.  I don't know if we got enough votes to even think about it, but at least I'm going to support it; Thank you.


SPEAKER KRISTENSEN:  Senator Brown.  Sen or Dierks.


SENATOR DIERKS:  I call the question, Mr. Speaker.


SPEAKER KRISTENSEN:  Senator Dierks, that won't be necessary.  Yours was the last light at that point in time and you're recognized to close on your amendment.


SENATOR DIERKS:  Thank you, Mr. Speaker and members of the Legislature.  This amendment was brought to me by, excuse me, by the Class I's.  It's their effort to try to keep themselves viable.  So the worries that you have, Senator Schrock, about the Class Its being overly taxed, it's an issue that they prefer to put on themselves.  They look on it as an opportunity to




provide their education the way they like to see it provided and not have to be under the thumbs of another district that manages their budget for them.  So I...I have no problem with this.  These people are all farm/ranch people and if they're willing to do this I would think that we should be willing to let them.  With that, I'd ask for a call of the house and a roll call vote, please.


SPEAKER KRISTENSEN:  There's been a request to place the house under call.  All those of placing the house under call vote aye; all those opposed vote nay.  Please record.


CLERK:  23 ayes, 0 nays, Mr. President, to place the house under call.


SPEAKER KRISTENSEN:  The house is under call.  Would all unauthorized personnel please leave the floor.  Would all unexcused members return to the Chamber and record your presence.  The house is under call.  Senator Bromm, would you check in.  Senator Brown, Senator Raikes, Senator Wesely, Senator Will, Senator Kiel, Senator Lynch, the house in under call.  Senator Raikes, the house is under call.  Senator Bruning, the house is under call.  Senator Dierks, all members are accounted for.  Members, would you please keep your conversations to a minimum.  Mr. Clerk, the question before the body is the adoption of the Dierks amendment to LB 1219.


CLERK:  (Roll call vote taken.  See page 1622 of the Legislative Journal.) 8 ayes, 25 nays on the amendment.


SPEAKER KRISTENSEN:  The amendment is not adopted.  I raise the call.  The call is raised.  Next amendment, Mr. Clerk.


CLERK:  Mr. President, next amendment, pursuant to the major proposal provisions, Senator Coordsen would move with AM4312.  (See pages 1622-24 of the Legislative Journal.)


SPEAKER KRISTENSEN:  Senator Coordsen, you're recognized to open.


SENATOR COORDSEN:  Thank you, Mr. Speaker and members of the body.  AM4312 is a different amendment from that that you have




in the system.  Yesterday we had ran the other amendment past a number of people in the State Department of Education and otherwise in the system, for technical correctness, and they made some changes in the other amendment, so this is a different amendment, so on your desk each member should have a copy of AM4312.  Before we get into this amendment in any detail, I think it is important to visit the history of this which actually is originating earlier this year as LB 1247.  LB 1247 was an outgrowth of a number of meetings that the Governor had with school administrators and school board members around the, state who were suffering from a dramatic reduction in available, funds for the '98-99 year as a result of a combination of effects of (LB) 806 and (LB) 1114.  The Governor felt or at least he indicated to me that he felt that we needed to do some temporary assistance to those schools that were the most disadvantaged by the loss of revenue.  I could not tell you how many meetings have been held since that time.  Senator Bohlke and I have had many, many meetings.  The (LB) 1247, as it originally was introduced, would have provided, to about 61 schools in the state of Nebraska, a one-time payment that would have given to them for next year an amount of money to ...  to...  so that they would have 90 percent of the resources available to them that they have this year.  Bear in mind it was a one-time payment and it was intended to give these systems another year to look at a ...  perhaps a better way of structuring.  (LB) 1219 came about at about the same time and provided that different way of structuring.  I thought, and others agreed with me, that 1247 could be an adjunct and an enhancement to 1219 in that it would provide a mechanism to tide a number of schools over till they had a chance to look at this new way of organizing schools within an area, that is, unification.  Now to go to AM4312 item by item, and I'll try to explain where we're at as we go through the system, it adds the following new sections to 1219.  Section 18, it speaks to temporary mitigation funds and this section indicates that there would be a one-time payment for the school year, for 1998-59 school year, to those schools that are at less than 90 percent of their property tax and state aid resources.  And it provides that it would be a lump sum payment made in the '98-99 school year and it would be outside of any state aid resources or any other payment, a one-time payment for those schools that qualify.  And it's important to remember that word, those two schools that qualify.  Section 18(1)(a) then




says the minimum qualification, and this is one that each school that would apply would have to make, and that is that the local system's budget for this year, the year we're in, did not exceed the 195-96 General Fund budget minus the special education budget by more than 2 percent plu's or minus the percentage growth in students for local systems.  So that is a fundamental criteria that each and every school that is below 90 percent in resources would have to meet.  Then the school or local system would have to meet one of the three following criteria:  (b)(i) which would apply to most of the schools that are qualified from the 90 percent standpoint, they must have shown an intent to merge, consolidate, or unify with at least one specified high school by June 1, 1999.  And in case there's some misunderstanding, that would be the time, the date that an agreement would have become officially signed.  They illustrate this intent through a public affirmative vote by the school board of the high school district and the local system with a majority of the members signing an affidavit acknowledging that the intent of the signing board member is to proceed with a merger, consolidation or unification involving the-district on the board of which they're serving and that signing such affidavit without the intent is official misconduct.  So it's a fairly serious decision.  We were trying to avoid people saying, well, yeah, we'll do this and then not be intending to make their very best effort to merge, consolidate, or unify.  Or then the other second criteria is that the local system is within the sparse cross grouping or the very sparse cross group, very sparse cross grouping.  That is those schools that really don't have a good likelihood of finding someone to align with but it gives them another year to reduce their expenditures and try to avoid doing a levy override such As is happening today.  Or three, and I understand there are a couple of schools in the state that fit this classification, the local system is subject to the 10SB of state aid due to a clerical error on the part of people outside of, and this really means those that are not connected with the schools, i.e., the Department of Revenue or someone in the Department of Education.  Then on page 2, line 9, it begins how the distribution of funds to eligible districts, eligible systems would be proposed; and they are to be distributed on a pro-rata basis in the event there's not enough money appropriated to cover all of the requests and it tells when the payment should be made.  Local systems that include




Class I districts shall divide their payment proportionately based upon the way the formula students attribute to each district in the system.  And then it goes on to some definitional section for local system, what percentage growth means.  The property tax and state aid resources shall mean the sum of the state aid plus the property tax resources multiplied, the valuation or adjusted valuation multiplied by $1.10; and that is presided in here.  And then the final section...




SENATOR COORDSEN:  ...  is on the last page and I don't know whether I mentioned it opening up, but 1247 originally contained an appropriation of six million seven hundred and eighty-some thousand dollars for these purposes.  At the Governor's request, this money was cut to $4,500,000 because it was recognized that the criteria that are in place in this amendment would in fact reduce the number of schools from about the 60 or 61 that were originally eligible down to a figure of less than 40, 30-some.  We don't know what the amount of the number of districts...




SENATOR COORDSEN:  ...  would exactly be because much of that depends upon the individual districts, who qualify through meeting two of the criteria, one that everyone has to meet...




SENATOR COORDSEN:  ...  and then one of the others would be a number that would be between 30 and 40 schools the state.  Thank you, Mr. Speaker.




CLERK:  Senator Beutler would move to amend Senator Coordsen's amendment.  (See page 1624 of the Legislative Journal.)




SENATOR BEUTLER:  Mr. Clerk, because I had to adjust the




amendments to meet the refiled, the refiled Coordsen amendment, would you read aloud the amendment that is now before you.


CLERK:  '"On page 2, after line 8 insert the following new paragraph:  The temporary mitigation funds provided in this subsection shall be returned if the receiving district..." It was your original 4324, Senator.




CLERK:  "The temporary mitigation funds provided in this subsection shall be returned if the receiving district does not merge, consolidate, or unify prior to June 30, 2000."


SENATOR BEUTLER:  Okay.  Mr. Clerk, thank you.  Members of the Legislature, I think there are ways of making this particular amendment agreeable to everybody, but it seems to me that there ought to be an added measure of sincerity in subdivision (b) of Section 18 in this particular amendment.  I'm concerned in the first place because this money is not given out through the state aid formula.  The state aid formula is the system that this body agreed upon was the fair way to distribute money.  I don't know what schools are benefiting from this money other than that they are schools who are below 90 percent of the last distribution.  And maybe I should ask Senator Coordsen if he would respond, I would like to ask you, Senator Coordsen...


SPEAKER KRISTENSEN:  Senator Coordsen, would you respond?




SENATOR BEUTLER:  I have a list of the schools who received less than 90 percent, but I'm unable to come up with any figures or any information with respect to which of those schools would receive funds under the formula that you've set out in this particular amendment.  How can we know which schools are benefiting and which schools are not?


SENATOR COORDSEN:  Well, the very heart of the truth of the matter, Senator Beutler, is that we don't know with absolute certainty.  I do have, if it would be helpful to you, a rough draft of those who are under 90 percent that would qualify based




upon the information we have and based upon the action that they would take because there has to be a positive step taken by the schools.  And if that would be we have any extra copies or do we have to have some made?  We'll do...  I'll send this one over to you with a Page, Senator Beutler, and then we'll have a copy of, well, we'll have to have a copy made of these for everyone.  I didn't distribute it because it is'.,Ian indicative list rather than an inclusive list because I really don't know with certainty.  It would indicate those schools that would participate.


SENATOR BEUTLER:  Okay.  Thank you, Senator, and that measure of certainty is of some importance to me because there may be some schools that somehow the formula didn't treat them correctly.  But also in that list there may be a good number of schools that should definitely be taking some other action and should not be particularly awarded General Fund monies outside of the 806 formula.  I mean we're just throwing aside the whole hard worked-up formula and saying we're going to forget about all that.  We're going to forget about talking about all the equities and all of the comparisons between school districts and we're going to flush this General Fund money into the system on a one-time basis.  And we're going to do that both for schools that one might argue are beneficial or should be helped, but I'm worried about the fact that it may also be done for a number of schools that should be taking other action.  Let me be clear on what the amendment does to begin with, though, so that you know.  In this bill, there is a section, it starts on line 16 and follows through to the following page, the top lines of the following page, and this subsection (b) along with subsection (a) you have to qualify under (a) and (b) in order' to qualify for the funds.  And the (b) portion says that the local system has shown an intent to merge, consolidate, or unify with at least one specified high school by June 1, 1999, through a public affirmative vote by the school board of the high school district and the local system with a majority of the members of the school board signing an affidavit acknowledging that the intent of the signing school board is to proceed with a merger, consolidation, or unification involving the district on the board of which they are serving and that signing such affidavit without the requisite intent is official misconduct pursuant to Section 28924.  Looking at what is perceived to be the general




intent here, which I feel positive about is that it seems to say that with regard to ...  with the exception of a couple of small exceptions involving schools in sparse areas and with the exception of a loss of state aid by clerical error which will involve only a few districts, the large portion of the bill involves subsection (a) and (b) that we've talking about here now and (b) requires this, what I perceive to be a commitment to merger, consolidation, or unification, Senator Coordsen.  Have I stated it fairly?


SENATOR COORDSEN:  (microphone not act ivated) ...  intent that a serious commitment to proceed with talks or whatever happens with adjoining school systems would be accurate.




SENATOR COORDSEN:  That that is not a frivolous intent.


SENATOR BEUTLER:  My amendment is to simply ensure that there is no way that the intent could be a subterfuge or treated in a frivolous manner by any school board.  And that is to say that if they accept monies under this mitigation fund provision and they do not by a particular date either merge or unify or consolidate, then they would have to pay back the money.  This is the same kind of mechanism that we used in the main portion of the unification bill.  And it would seem to me that given your intent, Senator Coordsen, that this kind of commitment from these school districts is very much in order and would go a long, long ways, Senator Coordsen, towards developing a real broad consensus on this particular bill.  That intent, that commitment to merger, consolidation, or unification is particularly important for a lot of these school districts that are under this 90 percent list.  For example, and this is almost past history now, I think, but Guide Rock was one of the public schools on this list.  You all may have seen in the paper the other day that in the Guide Rock social studies class there were three students.  Well, it would be awfully nice...




SENATOR BEUTLER:  ...if in all classes in the state we could have student/teacher ratios of three to one.  But I think




clearly in the case of schools like Guide Rock who I think now has no longer a high school or plans to have no longer a high school, but in the case of Guide Rock and I would argue in the case of Pawnee City and Table Rock and a whole number of other schools on this list, we should not be giving them further money without the commitment to merger or consolidation -or, if this body is going to approve unification, unification.  That would be the fair exchange for public money which is outside of the 806 formula and sales and income tax money coming from all over the state to a few school districts on a basis that was not justified under the 806 formula.








SENATOR BROMM:  Thank you, Mr. Speaker.  I'd like to go back and try to put in what I thought was the perspective within which this effort was begun.  We had LB 806, we had some consequences that were rather drastic for schools and a number of us in the Legislature and I think the Governor as well made a commitment to try to rectify on a very short-term, one-year basis what had been a rather disastrous immediate consequence for some districts, a consequence that they really didn't have time to react to under the circumstances.  A safety net, if you will, just provide a temporary safety net till they could catch their breath and decide where they were going to go-from there.  I think the intent of that, even though some of the language in the amendment gives me some heartburn, the intent of that is still fairly well captured with most of the amendment.  I don't think, Senator Beutler, that it is prudent or good judgment on our part to presuppose that merger..  consolidation, or unification will in fact save money.  And I think that is a fallacy and an unfounded assumption that this am endment would place into the amendment, your amendment would place into the Coordsen amendment.  I certainly would agree with doing everything to encourage these schools and others to look at in a very, very serious way the possibility of unification, merger, or, consolidation.  That has to be done by running the numbers, the logistics, the costs of whether or not different facilities




would be required, what the cost of busing would -be, what the savings of administrative costs would be, what the savings, if any, of teaching faculty would be, what the ramifications of the length of the school day might be as far as how long, a child might be on the bus to and from school.  Those are all legitimate factors to be looked at in a serious study of a merger, consolidation, or perhaps a unification.  It is not, it is not in my view possible for us to presuppose or to assume that all of these schools that would perhaps fall into a category of needing this safety net would be ...  that it would be good business to require them to merge, consolidate, or unify.  That's an assumption that has no basis and would be, I think, poor legislation on our part.  I rise to resist the amendment to the amendment.  I will deal more with the rest of the amendment when I have an opportunity.  But let me say this, that I think that if we put the Beutler amendment on to the Coordsen amendment we are taking what I think is a well-intended safety net and making it into a harpoon...




SENATOR WESELY:  One minute.


SENATOR BROMM:  ...  for the districts that are involved in the situation.  And I don't think we should do that.  And I really feel strongly about that so I would encourage the body to not adopt the Beutler amendment.  Thank you.


SENATOR WESELY:  Thank you, Senator Bromm.  The Chair recognizes Senator Elmer, followed by Senator Wickersham and Dierks.


SENATOR ELMER:  Thank you, Senator Wesely.  In listening to the debate, listening to Senator Beutler and his amendment, thinking about other things that we're doing in other areas, one of the things I'd like to ask, Senator Coordsen, would you yield for a question?


SENATOR WESELY:  Senator Coordsen do you yield?  Okay.


SENATOR ELMER:  Senator Coordsen, it would seem to me that if a school district had an intent to merge that it would need to merge with somebody.  It takes two to tango.  Wouldn't it be




proper that they have the district they intend to merge with also have the intent stated within this so that it would be apparent that wit h the cooperation of the two districts the merger could be anticipated to take place?


SENATOR COORDSEN:  And that was something that we did talk at some time about.  I have my light on sometime a little bit further down the road to elaborate on why this is worded in the manner that it is worded.  At one time, it was worded in -,the manner that Senator Beutler is suggesting.  And it was felt that since we didn't know all of the adjoining districts because 'each one is separate that they had to certainly would have to have another high school system, another system contained within the high school named.  And we didn't specifically set out that that other high school had to agree also.


SENATOR ELMER:  Okay, thank you, Senator.


SENATOR COORDSEN:  The other high school system may well be one that has 106 percent of their available resources for the next year.


SENATOR ELMER:  Sure, I understand.  Considering all of the things that I've heard so far, I think I'm going to support Senator Beutler's amendment to the amendment this time.  Is Senator Bohlke on the floor and available?  I'd like to ask her a couple of questions if I could.  I don't ...  yeah, Senator Bohlke, could you respond to a question or two?


SENATOR BOHLKE:  Yes, Senator Elmer.


SENATOR ELMER:  Senator Bohlke, this would require an appropriation of over $4 million and we have a lot of other bills out that are going to require appropriations such as our gifted programs and so on.  Given the status of our budget, do you think that this particular type of an appropriation would be in direct competition with, and we may have to sacrifice one or the other such as the gifted program we're talking about?


SENATOR BOHLKE:  Senator Elmer, this amount of money comes from the cash reserve and so doesn't show up as an A bill and so for those bills out there with an A bill, it wouldn't be in direct




conflict out of, you know, those are out of General Fund, this is out of cash reserve.  You know, I don't know philosophically if people feel that there's, if you do one or the other that would be a difference, but certainly not on how we fund it.


SENATOR ELMER:  Okay, thank you.  And then one other question is having your experience with the education field that you do, how do you feel that this amendment would impact or how would it compare with the things that we have done with schools...


SENATOR WESELY:  One minute.


SENATOR ELMER:  ...  that have accomplished merger or consolidation?


SENATOR BOHLKE:  Well, Senator Elmer, and I plan to speak to this point again, I think on the list that Senator Coordsen's office has put out on the floor and the side that starts with Rising City at the top, you would ...  those schools who have merged or consolidated would have to come off that list because they've done that so how could they indicate that they would merge or consolidate?  And the other who would have to come off this list would be if you are not...  if you haven't done that or you are not sparse or very sparse.  So if you have merged or consolidated, you...  it would be very unlikely that you would be able to, and you aren't sparse or very sparse, very unlikely that you would be able to take advantage of the funds.  And I think Senator Coordsen was shaking his head, yes, on that.






SENATOR WESELY:  Thank you, Senator Elmer.  The Chair would like to recognize some guests who are visiting the Legislature in the north balcony.  There are 35 fifth graders from Sandoz Elementary in Lexington, Nebraska, and their teacher.  And they have a student that appears very much like Jim Cudaback I believe up there.  We welcome you.  Thank you.  The Chair recognizes Senator Wickersham, followed by Senators Dierks, Beutler, Stuhr, Brown, Robinson, Coordsen, and Matzke.  Senator Wickersham.




SENATOR WICKERSHAM:  Thank you, Mr. President.  I'm opposed to Senator Beutler's amendment, one, for a technical reason that I've noted for him that the way it's placed in Senator Coordsen's amendment it would modify three different categories .of schools and would modify, in fact, the local systems that are sparse or very sparse and also modifies the local system that looses state aid to a clerical error.  So not only does it...  it fits in a way that I don't think Senator-Beutler believes is appropriate.  That's a technical concern.  But the other one is a philosophical concern and Senator Elmer started to touch on it.  And I'm concerned, as I think Senator Elmer was suggesting, that despite the best of intentions of one of these schools that they might not find anybody that's willing to merge with them because almost by definition what they're going to be trying to find is someone who has a less costly system or a lower levy than they do to merge with and hopefully in that way save money for the taxpayers.  But if you're a very high-cost system or district end you try to merge with someone else and you can't find any way to recognize economies out of that combination, then no one, no one will merge with you.  And I'm a little bit concerned that in that instance despite their best intentions they could be penalized.  I'm also a little bit concerned on a philosophical basis because I have I think stated many times that despite the drive by many to cause and promote consolidation that I'm not sure that it will always save money.  So if we were going to put this kind of a condition in, I think you only ought to reward them for consolidations that in fact would save money; and they'd have to prove that in some objective sense.  I don't think we want them to merge so that it costs more money, for example, and I think we'd be sending the wrong message.  The other comment that I want to make is to the Coordsen amendment in principle, and I support that amendment and I think it's an entirely appropriate thing for us to do.  I know that Senator Beutler has raised some concerns about that, but what has happened when we started the effort to reduce property taxes, we recognized in the provisions of 1114 that we needed to have a transition period.  That school districts, the 'counties, the municipalities and others needed time to adjust.  We did not put in place the levy limitations immediately.  The same thing can be said about 806.  No one knew that when we started down the road of 1114 that we were going to wind up with




806 or who it was going to impact or how it was going to impact them.  We only knew that as of December 1, last year.  Educational institutions, educational political subdivisions cannot turn on a dime.  They're unable to do that and in part they're unable to do that because of restrictions that we've placed on them and we shouldn't expect them to turn on a dime.  Senator Coordsen's amendment, as I understand it, is an opportunity for them to at least turn on a quarter, if not turn on a dime.  We just can't expect them to change-that quickly.


SENATOR WESELY:  One minute.


SENATOR WICKERSHAM:  And so I will reiterate my opposition to Senator Beutler's amendment, both on the technical ground that I noted and on the philosophical grounds, and hope that the amendment will not be adopted.


SENATOR WESELY:  Thank you, Senator Wickersham., The Chair recognizes Senator Dierks.


SENATOR DIERKS:  Thank you, Mr. President and members of the body.  I had my light on originally to speak to the Coordsen amendment which I think, which I'm going to support.  Philosophically, you know, the amendment was brought with the correct idea and that was to provide some funding for those schools that got hurt worse with the bill we passed last year, 806.  That was the sole intent and the sole purpose of it.  But, and at that time when it was introduced it would take care of 60-some schools out there.  Well, now it's already been altered to the point where it's not going to do that and yet we're trying to alter it again with the Beutler amendment to force consolidation.  I just have to object to that.  I can't support the Beutler amendment.  I don't think that's what it's about.  I think we're trying to just provide some one-time support, one year to help those schools that were hurt so badly by 806 last year, give them breathing room and keep them going.  Senator Beutler mentioned Guide Rock.  Well, Guide Rock evidently has seen the light or the light was forced on them and they've had to merge.  And maybe we forced that with 806.  1 think.  that was the intent of some people here, to force merger and consolidation.  I have yet to understand that drive that people have to make the people in the rural part of the state




merge with other schools.  We have found that the cost of our districts, our schools in our rural part of the State are even less than the cost per pupil in Lincoln or in Omaha; We have those figures to prove it.  So it's difficult for me to understand the process that you try to put us through.  I hope that the body will not support the Beutler amendment.  I hope that they will support the Coordsen amendment.  I wish that we could have had the Coordsen amendment as the 'bill was introduced, the green copy.  I thought that did ''exactly what this body should have done in the first place.  Thank you.


SENATOR WESELY:  Thank you, Senator Dierks.  The Chair recognizes Senator Beutler.


SENATOR BEUTLER:  Senator Wesely, members of the Legislature, let me talk a little bit about the substance of what is in the bill on this particular provision.  And I read it through once for you already, but if I'm understanding the language correctly and, Senator Coordsen, please correct me if I'm not, but it seems to me to be saying that this intent to merge or consolidate or unify is demonstrated by the board of a school district sometime before June I of 1999, a year and some out there, has to have an affirmative vote, and sign an affidavit acknowledging their intent to proceed.  Now as you all know, intent is something in a person's mind and I want to discuss that a little bit.  But I see Senator Coordsen I think maybe wants to clarify that a little bit and certainly that would be appropriate, Senator Coordsen, at this point in time.  If I could yield time to Senator Coordsen, I would.


SENATOR COORDSEN:  Very briefly, Senator Beutler, the June 1, 1999 date is when an agreed-to unification would take place.  The certification would have to be filed, the affidavit it with the state Department of Education on or before August 1, 1998, before any distribution of resources was made.  That would be the final date of the attempt at unification, consolidation, or merger.  That would be the effective date.


SENATOR BEUTLER:  Okay.  Then let me explore that a little further with you, Senator Coordsen, because maybe some path to resolution of that can be formulated along those lines.  If in that particular sentence there with the June I date, if you




added language indicating that the intent to merge, consolidate or unify by that date should be demonstrated by the completion of all documents necessary to effectuate the merger, consolidation, or unification by that date, if we added that language there which I understand to be your intent, would that hat be acceptable to you?  I mean that would help me a lot in terms of what this means.


SENATOR COORDSEN:  Well, no, and I'll tell you why because where we started out, Senator Bohlke and myself, was language very similar to what you are suggesting, that there had to be a culmination of this process and there had to be a merger, consolidation, unification or you had to return the money.  That's in fact the way it existed at one time.  The reason we changed it, the primary reason we changed it at least, is because of a fear a district could be held hostage.  Some other speaker mentioned not having any other district interested in merging with them although they might be in and of themselves wanting to unify with someone.  And the reason that we went with this language rather than the other was to keep a district from being held harmless or harmed in an agreement, a merger agreement or (inaudible), whatever, that they wanted to merge with a district that was at 105 percent of their resources under the formula, and that district really doesn't have any interest in merging with another.  So that's why we did not include a mandatory clause at the culmination of this year-long process.


SENATOR WESELY:  One minute.


SENATOR BEUTLER:  Okay.  I understand your end of the perspective.  From my end of the perspective, what is in here now which I think you've affirmed means in effect that only an affidavit has to be there by June 1 of 1999.  And that, and I will explain later, opens up the entire process in my mind to fraud and abuse and people signing affidavits who have no real intent to sign an affidavit.  Granted, there is a criminal provision there if you sign without the requisite intent, but you and I well know that no county attorney is going to prosecute anybody in the county for not having the requisite intent in this situation when they're trying to get more money for the local school district.  So I find that provision, although interesting on its face, probably it- would be fair to




say I think you would agree, Senator Coordsen, that there would be no prosecution and that the tool for enforcement here is totally unenforceable in a practical political sense.




SENATOR BEUTLER:  I will come back to that provision shortly.


SENATOR WESELY:  Thank you, Senator Beutler.  Before the Chair recognizes the next speaker, we'd like to welcome some guests to the Legislature.  In the north balcony we have the GFWC Nebraska Federation of Women's Clubs.  They're having their 30th annual legislative day.  The group is with their state president and legislative chair.  There are 70 ladies.  Please rise and be welcomed by your Legislature.  Thank you for joining us.  We also have some guests of Senator Hilgert, in the, under the south balcony, 16 students and sponsor from Gross High School.  Would you, too, rise and be welcomed.  Mr. Clerk.


CLERK:  Mr. President, Appropriations Committee will meet in Room 2022 at 11:30, Appropriations, 2022 at 11:30.


SENATOR WESELY:  Thank you.  The Chair recognizes Senator Stuhr followed by Senators Brown, Robinson, Coordsen, Matzke, Raikes and Beutler.


SENATOR STUHR:  Thank you, Mr. President and members.  I rise in support of Senator Coordsen's amendment.  I believe that this amendment is crucial to the school districts that have been impacted by LB 1114 and 806.  It really simply is a Band-aid effect to stop the flow of blood that is occurring in these school districts.  These schools have excellent educational programs.  Yes, they are smaller.  They have smaller enrollments.  And with the passage of 806 we know that they were impacted because the effects of the school aid formula on these schools depended much on the enrollment and the cost per student.  I believe that all students in this state are entitled to equal education opportunities.  It shouldn't matter where you live.  It shouldn't matter if you live in Henderson or if you live in Lincoln or Omaha.  All students should have equal opportunities.  These schools that have been impacted are going to suffer loss of teachers, simply loss in core curriculums.




We're not talking about extra programs.  We're talking about coke curriculums that there simply will not be funding.  As was mentioned, there has to be some kind of transitional period.  Schools simply were not able to react that quickly to the passage of LB 806, and that's why I rise also in opposition to Senator Beutler's amendment.  They do need more than one year.  I can just give the example of my school in my local community, Bradshaw, that is consolidating or has consolidated with Henderson.  It didn't happen overnight.  They actually worked three, four years together in sharing programs.  And I think a good point has been made throughout some of the other discussion that money is not always saved by consolidation.  I think each instance, each school district has to assess and do their feasibility studies to see what the effect might be.  Again, this is not taking any money from any other school.  These funds are going to come from the Cash Reserve Fund.  And I then do rise in support of Senator Coordsen's amendment and in opposition to Senator Beutler's.  Thank you.


SENATOR WESELY:  Thank you, Senator Stuhr.  The Chair recognizes Senator Brown.


SENATOR BROWN:  Mr. President, members of the Legislature, I am rising in support of the Beutler amendment because I believe that that is what we are trying to ...  the underlying thing that we are trying to accomplish with 1219.  But I do have some questions that I'd like to pose to Senator Bohlke.  I guess that she would be the best person to address them to about the Coordsen amendment.  Senator Bohlke, would you yield?




SENATOR BROWN:  All the school districts have had the same amount of time to prepare for the effects of 1114.  Is that not true?


SENATOR BOHLKE:  That would be correct.


SENATOR BROWN:  And so can you tell me how, what number of districts have already voted to exceed the levy limits?


SENATOR BOHLKE:  I'm not sure of the exact count.  I know this




morning there were three and I know in your area of two and prior to that I believe there were four.  I would say maybe 10 or 10 to 12 would be a guess.


SENATOR BROWN:  And how many of them would have been affected by this incentive money?


SENATOR BOHLKE:  Well, it would be difficult to tell because, first of all, you would have to know if they had exceeded, if they had voted to exceed the 2 percent lid...




SENATOR BOHLKE:  ...  because if they did that and didn't have student growth, you could see the ones on the opposite side who do not qualify so you would have to know that to know if they would qualify or not.  And so I don't know if I can tell you that.


SENATOR BROWN:  Well, one of my concerns is it seems like we are helping some, not helping all, and it's not, we're not necessarily doing it on the basis of what the impact of 1114 was.  We are doing it on the basis of some way that makes the amount of incentive more manageable, but not necessarily what...


SENATOR BOHLKE:  I think, Senator Brown, that's true and what Senator Coordsen and I discussed is that even the schools that appear on the list here like I've tried to point out that appear that they may get help, in fact may not.  And Senator Coordsen and I have said, you know, it's very difficult.  You look at, over time we have always tried to look at Cambridge and Cambridge cannot find anyone to merge or consolidate with them.  And so it's very difficult although they, that's a school district if I could go down the list and what I know about all these different school districts point to one that I would like to recognize that really needs help, wouldn't qualify.


SENATOR BROWN:  Okay.  Isn't the point of 1219 to provide incentives for school districts to unify?


SENATOR BOHLKE:  That is to, yes, to get ...  to put a mechanism forward to allow schools to unify and then give them incentives




for doing that.


,SENATOR BROWN:  So am I wrong in construing this as a temporary incentive on top of the incentives that we already have in the bill to...


SENATOR BOHLKE:  Well, it would ...  there are a few, a few districts that you may have the overlapping occur.  A majority of them you would give them this help next year.  By the time they would have taken the vote to merge, consolidate or unify, it would be...


SENATOR WESELY:  One minute.


SENATOR BOHLKE:  ...  in following years out.  But there would be I think legal counsel had indicated a couple that may have an overlap that first year and would get both incentives.


SENATOR BROWN:  Okay.  Thank you.  My concern about this is that there are some of us whose school districts have not benefited a great deal from some of the things that have gone on at least while I've been in the Legislature.  One of my school districts has lost 12 percent of their state aid between '95 and '98 and would not be eligible for any assistance.  I know of so many school districts who under the old finance formula it was inequitable.  They for years did not get their, an adequate share of state aid...




SENATOR BROWN:  Thank you.


SENATOR WESELY:  Thank you, Senator Brown.  The Chair recognizes Senator Robinson.


SENATOR ROBINSON:  Mr. President, members of the body, it's interesting the list of schools that Senator Coordsen passed out.  I noticed like there's Omaha Westside, they've overridden their budget limit, and I think Milligan was one of the first ones that did that.  They list Filley.  Filley has consolidated now with Adams, Nebraska.  And I think that Hebron, I think I saw in the paper that they voted to override.  Senator Stuhr's




Bradshaw and Henderson there, they have consolidated so some of the things that have taken place, there has been some movement.  And I think you give them another year or two, there's going to be more movement.  It's interesting at Cambridge, I noticed in the paper that the bank I think gave them $50,000, the telephone company give them $50,000, and I think a lawyer give them $10,000 and I think a dentist give them $10,000 to, so they wouldn't have to, and I don't know if they're going to vote, but I did see that in the paper where they're getting that money.  And I guess as I look at this, it seems to me that I don't think now is the time to solve this.  I think it ought to go back to the Education Committee and they ought to take a fine look at this because I think, I'm not.  sure all of these schools should receive money.  I have some questions for Senator Bohlke if she'd...




SENATOR ROBINSON:  Now all of these schools still can have a vote, right?




SENATOR ROBINSON:  They can vote to override.




SENATOR ROBINSON:  Okay.  And I know it was brought up by Senator Brown, we're talking about unification, they're going to receive an incentive for unifying.  This here to me it seems like it's another incentive.


SENATOR BOHLKE:  If you would qualify for the unification.




SENATOR BOHLKE:  There are some on here...


SENATOR ROBINSON:  Depending, I mean some schools would.  I don't know...


SENATOR BOHLKE:  Soma we've said that have already consolidated




obviously wouldn't be able to merge or unify once again.


SENATOR ROBINSON:  Yeah.  And I guess a problem I always have when we're talking into the millions of dollars, I'd like to find out where the money is going to go.  I don't know where the money is going to go.  I'd like to see if any money is going to go to my district.  That's what always happens and, you know, Senator Stuhr talked about equal opportunity.  You know, equal opportunity is measured a number of ways when you start talking about state aid.  It's how many students you have, what level of a valuation you have and so forth.  So I think equal opportunity is in the eyes of the beholder.  And there's another question I'd like to, Senator Bohlke.  The Governor's committee on LB 806, did they recommend any changes in 806?


SENATOR BOHLKE:  Their recommendation was to make no changes in 806.


SENATOR ROBINSON:  Okay.  Now this would be a change in 806.  Would that be correct?  Would you say that?


SENATOR BOHLKE:  It's difficult.  The schools are on the list because of what they perceived a crisis situation.  Senator Dierks alluded to the fact that it was because of 806, but actually all the schools who lost more than 90 percent who were in that low cost efficiency that we did towards the end of 806 were put into 806.  So, and in 806 ...


SENATOR WESELY:  One minute.


SENATOR BOHLKE:  ...  if we thought the attempt was to get schools to make, and I think we've said on the floor, to make those decisions as to what they should do, to that point this works counter.  I think the...




SENATOR BOHLKE:  ...  phone calls to our office...


SENATOR ROBINSON:  That's fine.  I have just a few, I cannot support the Coordsen amendment.  I'll listen further to the Beutler amendment.  But I think that this ought to go back to




the Education Committee and if their people, for example, the two parts that Senator Coordsen I think, the sparsity factor should be taken a good look at and certainly if there's been clerical errors those should be rectified.  And then there may be others in there.  If there are there, then they should be brought back next year because -I think there's plenty of alternatives out there now.  Thank you.


SENATOR WESELY:  Thank you, Senator Robinson.  The Chair recognizes Senator Coordsen.


SENATOR COORDSEN:  Thank you, Mr. President, members of the body.  We've ranged a little bit of field I guess since I was last up here.  The Beutler amendment is, I believe I understand the Beutler amendment, it's been a little bit of time since I read it, but this would require the repayment if a merger, consolidation, or unification did not take place.  And I will tell you again that Senator Bohlke and I, in one of our original proposals, did in fact have that as one of the proposals that was in here that schools that participated would have to do.  But as we went along through the process, the thought process evolved that it was entirely possible for those schools that were serious, and that's what we're looking at hopefully, are those that are serious that changing their structure had the potential of being held hostage by other schools in the area that they might be interested in merging with if, in fact, those schools were at or above 100 percent, and there are many of those in the state of Nebraska, in all areas of the state that are at or above 100 percent with the state aid they're getting and with the $1.10 levy applied to the valuation in the district.  That is why we ultimately came to this provision and the thought was, and I shouldn't do this, but I would paraphrase I think Senator Bohlke when she said that the enforcement mechanism if a district looked at unification and filed the affidavit that they were going to look at unification and decided instead to do what several people have mentioned here on the floor, to do a vote and exceed the levy limit, that there would be a number of landowners that would quite probably join in suing the school board for not living up to their promise, their sworn promise to try to ...  or intent, the language says intent, which I received a number of letters as being too severe, that they didn't carry forward with their intent and




they should be liable for what happened after that.  This is not a selection of words that we agreed to willy-nilly, but one that was quite seriously thought through.  I would comment just a little bit on what Senator Robinson's arguments were in opposition to the whole amendment.  And when he mentioned all of the veto or all of the levy overrides that have taken place already, I would share with you that we are already four months too late with this bill because the original intent of 1247 was to provide a little breathing space to allow districts the ability, the time, to see if there were better systems without going to a veto or a levy override.  And I would suggest that without this amendment to 1219 that 1219 in and of itself...


SENATOR WESELY:  One minute.


SENATOR COORDSEN:  ...  will become a moot issue because of the ability in rural districts, and Senator Robinson has to understand certainly because of his districts how valuations are divided, and it gets easier and easier to go back to the old ways and place most of the burden on agricultural property because that is where the majority of valuation is while the majority of population does not own agricultural property.  So all of our efforts for property tax relief will again cease to exist for those who are in the business of agriculture or have, owned for whatever reason, pieces of agricultural property because we're seeing, as he indicated, a substantial number of levy overrides.  One of our goals here was to try to keep that from happening until schools had a chance to look at the unification process because I think it holds a great deal of promise for a better school structure in the state.  And without that opportunity to get by a year of negotiations, we simply are not going to see unification.






SENATOR WESELY:  Thank you, Senator Coordsen.  The Chair recognizes Senator Matzke.


SENATOR MATZKE:  Mr. President and members of the Legislature, I want to direct my remarks primarily in response to what Senator




Beutler has proposed.  I think we have a decision to make.  Is this bill going to be a penalty bill or is it going to be a life raft?  We, when we passed 1114, we set in motion a Titanic of a property tax relief measure and then last year came' along with another titanical bill in 806.  And unfortunately, the two have collided.  And the result is that we have a number of school districts floating in the freezing water about 'ready to be extinguished from being able to provide education.  And that's all that this bill does.  LB 1247 is a life .,raft proposed initially by the Governor, worked on by Senator Bohlke and Senator Coordsen to provide a life raft to certain school districts for a one-year transitional purpose.  Now if we turn that into a penalty bill, it's not going to serve its function.  I'd like to just give you a case history on one school district that's featured in this morning's edition of the World-Herald, deals with the South Platte School District in western Nebraska which involves Brule and Big Springs.  This school district has been caught in the collision.  It's been damaged, and it's been deprived.  Big Springs and Brule are each towns under 500 people.  They did the right thing.  They consolidated in 1995.  At that time, Big Springs' levy was $1.10.  But as a result of their consolidation, the effect was they lost over $300,000 in state school aid and despite reducing their budget last year by $43,000, their mill levy went from $1.10 to $1.50 because of their merger and their loss of school aid.  Now the combined effect of 806 and 1114 is going to cause that school district a loss of $498,000, almost a half million dollars out of about a $2 million budget.  They will have to survive not on 90 percent, which is what this bill deals with, but on 74 percent, almost 75 percent.  And they have a school district to try and operate on 74 percent and they had nowhere to turn.  So they went to the election process yesterday and the World-Herald 'report this morning shows that that election lost 242 to 170.  And my contact with people out there shows that they have just simply lost faith in the system that we have provided because they've been caught in the middle.  Now this amendment would be a life raft for districts like that.  They're listed on the list that Senator Coordsen put forth.  They would under this proposal receive $299,000, they would still have to cut $200,000 or about 10 percent out of their school budget.  But what we have here is a list of drowning school districts and who's going to suffer?  I think that the bill as it has evolved, or the amendment as it




has evolved, in the negotiations between Senator Bohlke and Senator Coordsen requires them to signify their intent..  But if we carry it a step further like Senator Beutler has proposed in his amendment, we will make it a penalty bill which is going to have the effect not of encouraging consolidation, but it's going to have the effect of actually sinking some school districts.


SENATOR WESELY:  One minute.


SENATOR MATZKE:  I, therefore, would urge you to oppose Senator Beutler's amendment because I think it turns the direction of the bill and 'Let's keep the original intent of 1247 which is the amendment which is a transitional bill.  It's a one-year program.  And for that, I commend the Governor in his wisdom for throwing out a life raft to some of these school districts to give them time to adjust to the effect of 806.  Senator Wickersham was absolutely right.  When we passed 806, we knew we were going to hurt some school districts and we knew it was going to take time to make this transition.  And that's all this does is it gives them a year to save their school districts and to make that transition and to signify, if they can, their intent to merge or consolidate.






SENATOR WESELY:  Thank you, Senator Matzke.  The Chair recognizes Senator Raikes.


SENATOR RAIKES:  Senator Wesely and members, thank you.  I am probably just going to express my lack of understanding of this issue.  Where I come down now is I support the Beutler amendment, but maybe I could be straightened out.  If mergers aren't likely to work, why do we even put it in there?.  I think that the language of the Coordsen amendment emphasizes that really this is the only avenue we Bee for these schools.  Now if it isn't going to work, maybe we do them a disservice by' even mentioning it.  The second thing is what is really required?  Senator Coordsen mentioned schools being held hostage if payback is required.  On the other hand, there would also I think be some strategic implications of schools that would be eligible




for the money.  They would make sure that they would do whatever is required to receive this money, whatever strategy is required.  The second or another point that's mentioned is about transition.  My concern is what will happen after a year other than if mergers don't work, you'll be a year older and just as broke.  I can't really see where delaying this thing, if that's all that's going to happen, is going to help with anyone.  I don't quite understand how this particular provision would tie in with unification or if in fact it might be a disincentive for some schools to consider unification if in fact that's a 'good idea.  The override option was mentioned.  I know in the hearing on 1247 we had a number of people who seemed to me to be saying that they were convinced that they had a good school in their local community, had strong local support.  They needed more money to operate.  But when you asked about the override, no, we would never get an override passed.  Well, there is a bit of a disconnect there it seems to me.  One additional point I would mention concerning LB 806, it confuses me that the general conclusion seems to be that nothing is required in the way of changing 806.  Well, but really 806 is supposedly the source of this problem.  You...  if you take the schools that would be helped by this amendment, those receiving 90 percent or less, then it's of concern to me that this amendment would treat these schools exactly opposite of how they were treated with 806.  And I think one of the things the Legislature can do that is a great disservice is to confuse school districts as to what the direction really is.  So either we're going one way or we're going the other.  And if 806 is the right way, then I would suggest it seems to me we should keep moving in that direction.  Senator Dierks mentioned that costs are often lower in rural schools than they are in urban schools.  I'm guessing, I don't really know, that the list of schools that are on the list or that were on the sheet that may receive this aid would not be among those that are lower in cost than urban schools.  If I'm wrong about that, I would appreciate knowing where their costs do lie.  And also I would appreciate knowing why the 806 formula treated them so harshly.  Maybe I should understand that, but I really don't.


SENATOR WESELY:  One minute.


SENATOR RAIKES:  One final point I would make is that it was




mentioned that this is not General Fund money, it's cash reserve money; and I would just say that I see very little difference there.  I think it should be regarded as an expenditure of $4.5 million that will last at most one year; and for a number of school districts, particularly without the Beutler amendment, may end up down the road simply with one more year experience and little else.  Thank you.


SENATOR WESELY:  Thank you, Senator Raikes.  The Chair recognizes Senator Beutler.


SENATOR BEUTLER:  Senator Wesely, members of the Legislature, Senator Matzke characterizes this as a life raft kind of provision.  And it may be for some of the schools on this particular list it is that.  But I would suggest to you that certainly some of the schools on this list do not qualify as life raft schools.  Senator Robinson mentioned Westside High School.  I think Westside High School is recognized as being if not the wealthiest school in the district certainly one of the two or three wealthiest schools in the district.  They are not hurting for funds.  They do not need a life raft; and yet if they're willing to sign this little affidavit, they can get $640,000.  They can get nearly a sixth of the entire amount of the money that we're giving away.  And I'm sure that no taxpayer in this state wants their sales and income tax money to go outside of the state aid formula to the wealthiest school district in the state and for them not only to get part of the money but almost a sixth of the money.  I suggest to you that the list is mixed and that it doesn't make a lot of sense.  Senator Coordsen, though, in terms of trying to find some middle ground, I was thinking of this and let me ask you for your, reaction.  If you took this amendment which says the temporary mitigation funds provided in this subsection shall be returned,' if the receiving district does not merge, consolidate, or unify prior to June 30, 2000, and then added this language:  unless the Department of Education waives such repayment for the reason that no reasonable merger, consolidation, or unification was possible.  Could we do that?


SENATOR COORDSEN:  I don't know whether we could do that or not.  I was thinking about Westside because you had mentioned it.




SENATOR BEUTLER:  Well, if somebody in Westside signs that affidavit, I'm going to ask the county attorney myself to file the...


SENATOR COORDSEN:  I would have to have you ask that question of Senator Bohlke because I believe the 2 percent student growth I think they're excluded because of that.  They're a nonequalized district.  This list that you have in your hand is not by necessity schools that would receive that amount of money.  That is simply a ...  oh, that is, you're right.  Yeah, it is.  An earlier draft didn't have Westside included because it limited the amount of assistance to any school to several hundred thousand dollars and reduced the amount of resources.  But again, the same problem with that does exist in that I doubt that this would be of assistance to very many because it would be then viewed dependent upon the Department of Education as mandatory school consolidation.  And given the success in rural areas of levy overrides which is where they are successful, that would probably be the option of choice of more and more districts.  I suspect some of these districts that we have on this list are going to operate on...


SENATOR WESELY:  One minute.


SENATOR COORDSEN:  ...  some one-time available resource they have, yeah.


SENATOR BEUTLER:  Senator, let me have the rest of my time back if I may.  I'm sorry.  I wanted to make that suggestion to you because it seems to me that the amendment itself is saying that, yes, merger, consolidation, or unification is a qualifier, but the objection to my amendment was but they may not be able to do that.  And so I think a reasonable middle ground here is to say that the Department of Education, an objective party, not one on one side or the other, ought to be able to look at this and determine if in fact there was no reasonable merger, consolidation, or unification possibility.  And if there wasn't, the money should come back because it's not given for the purpose of simply supplying the money.  Even your intent is to give the money only if there's an intent to merge, consolidate, or unify.








SENATOR WESELY:  Thank you, Senator Beutler.  The Chair recognizes Senator Bohlke.


SENATOR BOHLKE:  Yes, Mr. Speaker, members.  First of all, there's one thing that I think Senator Coordsen and I would both like to point out as I hear people treating this like a printout.  Now I have told you in the past, although I told you over and over and over again on 806, please do not bet the farm on this printout.  And we still heard people call our office and said, but you said that we would get this.  No, we didn't, as well with this list.  First of all, we used adjusted valuation so I'm guessing this dollar figure could very well be high.  Second of all, I went over and said to Senator Matzke, please do not call back if this would be successful and say to your district that Just South Platte that just got their levy override vetoed that we have now saved the day for them.  There's no way of knowing if any of these schools for absolute sure will get help or not get help.  And I just think it's very, very important and once again I'm not sure how many people are listening, but this is going to go out and it's going to go out to these schools on the reverse side that shows is an indication that we don't think that they're going to get help and we're going to start a lot of phone calls.  Now I know that it's...  I think Senator Coordsen correctly pointed out it's an indication, and I think that's a very good word as to what may or may happen with the schools that are listed here.  And I'm probably going to rise and say this two or three more times because we ...  this consistently happens to the office.  In answer to Senator Raikes' question as to why these schools were hurt so badly, a majority of them it has to do with 1114 because 806, the reason you would get a double impact of 1114 and 806 generally would be if you lost students or if you had an increase in your valuation or you had a correction payment from the Department of Education for the prior year.  Those are the reasons because remember the 90 percent, we put the small school factor in 806.  What these schools didn't qualify, one of those things would have happened:  loss of students, increase in valuation, or a.  prior year correction or an error, but we have a couple of situations.  And




so many of these schools on this list were better off with 806 than if obviously it would have been 1114 without 806.  And so, Senator Raikes, does that help you?  That generally, generally would be true:  loss of students, increased valuation, prior year correction, or an error.  And so 1114 really certainly for all schools had the ramifications that we've been dealing with.  But I wanted to rise and then again explain that as best I could to Senator Raikes beings he raised the question.  And ..Senator Dierks had raised the question about the ones who were lower cost and forgetting ...  and some of you may have forgotten that we had the small school factor in the end into 806.  That if you were at, that would get you if you were below 90 percent, you got a small school factor in 806 as long as your spending was within the guidelines of 806.  And so I hate to start discussing school finance again, I thought we might be able to got past it this session.  But when points are raised on the floor, I do think I have to clarify and do the best job I can to explain to you...


SENATOR WESELY:  One minute.


SENATOR BOHLKE:  ...  what the possibilities may be.  But please again do not count on ...  Senator Stuhr just asked me, Bradshaw and Henderson have already had the vote, are going ahead with their consolidation.  That is the example of a school district that now would get payments, two payments in the first year.  They would get this payment and they would get the payment that I think they qualify for under consolidation.  So the others, though, I think that was the one instance that legal counsel said on the list that would be, that that could happen double in the first year.  The others would not because they would, by the time they voted to unify or merge, it would not be the same' year as this would apply.  This applies, would apply immediately.


SENATOR WESELY:  Time.  Thank you, Senator Bohlke.  The.  Chair recognizes Senator Brown, followed by Senator Bromm, Hartnett.


SENATOR BROWN:  Mr. President, members of the Legislature, I wondered if Senator Coordsen would yield to a question because I guess I'm confused by the list that was passed out.  Doesn't your amendment include a sparsity factor?




SENATOR COORDSEN:  My amendment includes the provision that if there is a sparse school district under the definitions that we adopted last year in 806, that that factor alone would entitle them if they were, had a 2 percent growth...  less than 2 percent growth in their budget when adjusted for population and they were sparse or very sparse, would be qualified for the payment that is provided under this to whatever amount that would amount to.  And the reason that's in there is because we did not take the time to go through the list of schools to try to identify sparse or very sparse.


SENATOR BROWN:  Okay.  My concern about the Coordsen amendment is that it seems like we keep putting incentives into legislation to address the impact.  And I really think that we are getting into a place where we're having incentives on top of incentives.  As Senator Bohlke just mentioned, the incentives that were already in place in LB 806 for small schools, then the incentives that are in 1219 for consolidation, and then this temporary incentive that may be on top, and we're still not addressing the fact that all these changes we made were to make an inequitable finance formula that had really been unfair to many districts for a long period of time that that's what we've been trying to do.  We've been trying to hold down property taxes with 1114 and then make an inequitable finance formula more fair to districts who over a period of years were not treated as they should be by the tier system.  And so for them I think somebody spoke earlier about blood being let.  For those districts who over a period of years were in that boat, the blood has already been let and we have just tried to make the situation more fair.  And every time we do that, and some of us whose districts don't necessarily benefit by every decision we make try to vote in what is best; and yet then it comes back to us time and time again that we have to go back and make the landing softer for other people.


SENATOR WESELY:  One minute.


SENATOR BROWN:  And I can just say that the landing for one of the districts that I represent has not been particularly soft, that that district has lost 12 percent of its state aid between '95 and '98.  And so I try desperately to hold onto what it is that we want to accomplish, what our goal is in terms of




encouraging efficiencies, encouraging consolidation, all those kinds of things rather than looking at the impact to all these districts individually.  And I believe that we already have in place under the incentives under 806 and what we're trying to put in place with 1219 the incentives we do need to make the landing softer.  So I oppose the Coordsen amendment and hope that we will continue to focus on what it is that we want to achieve in terms of holding down property taxes, making a system that is as fair as possible and making sure that districts are being as efficient as possible.  Thank you.


SENATOR WESELY:  Thank you.  Mr. Clerk, anything for the record?


CLERK:  Mr. President, I do.  Enrollment and Review reports LB 1209 and LB 1154A to Select File.  Bills read on Final Reading were presented to the Governor (re:  LB 320, 320A, 695, 695A).  Motion by Senator Hartnett regarding LB 1110.


Reference report of study resolutions be referred to the appropriate committees for interim study purposes.  Natural Resources Committee will meet today at 1:00 in Room 1517 for a confirmation hearing.  (See pages 1625-36 of the Legislative Journal.)


Mr. President, priority motions.  Which one would you rather take up, Senator?  Okay.  Senator Witek would like to recess until 1:30.


SENATOR WESELY:  The question before the body is" shall we recess?  Those in favor say aye.  Opposed nay.  We are recessed.  Thank you.






SPEAKER KRISTENSEN:  Good afternoon and welcome to the George W Norris Legislative Chamber.  Senators, would you please check in so we can begin this afternoon's business.  Roll call.  Please




record, Mr. Clerk.


CLERK:  I have a quorum present, Mr. President.


SPEAKER KRISTENSEN:  Thank you, Mr. Clerk.  Are there corrections to the Journal ready?


CLERK:  Don't have any this morning, Mr. President.


SPEAKER KRISTENSEN:  Thank you, Mr. Clerk.  We'll resume back on LB 1219.


CLERK:  Can I read one item, Mr. President?




CLERK:  A series of motions from Senator Chambers to LB 504 to be printed.  (See pages 1637-38 of the Legislative Journal.)


When we were on 5, or excuse me, 1219, Senator Coordsen had offered Amendment 4312.  Senator Beutler had moved to amend that.  The Legislature recessed in its consideration of the Beutler amendment.  (FA676 is found on page 1624 of the Legislative Journal.)


SPEAKER KRISTENSEN:  We'll resume with the speaking order.  They are Senator Bromm, Hartnett, Coordsen, Bohlke, and Beutler.  .Senator Bromm.


SENATOR BROMM:  Thank you, Mr. Speaker and members of the Legislature.  I would like to ask Senator Beutler a question.  Is he in the ...  yes, he is here, if he would yield to a question.


SPEAKER KRISTENSEN:  Senator Beutler, would you respond?


SENATOR BROMM:  Senator Beutler, the ...  the way your amendment is drafted, as I understand it, if the receiving district did not merge, consolidate or unify prior to the year 2000, they would have to give the money back.  Is that...  is that the gist of it?


SENATOR BEUTLER:  That's the gist of it, yes.




SENATOR BROMM:  Senator Beutler, would this require the approval under school law of ...  of the district or districts with which they are expected to merge, consolidate or unify?  In other words,...


SENATOR BEUTLER:  Would merger, consolidation or unification require somebody else's...




SENATOR BEUTLER:  ...  approval?  Yes, of course, you know.


SENATOR BROMM:  Okay.  So that would be, in...  in that respect, beyond the control of this system to control what those adjacent districts, I'm going to say adjacent because I don't really know if they have to be adjacent, but those districts with which they could be expected to consolidate, if '"hey would decline to do so and as you might say if they didn't want to take this load on or they didn't want to take this "bad apple" into their "barrel".  what's this receiving district supposed to do?


SENATOR BEUTLER:  Well, Senator, first of all the district, if it has no prospects for doing that, can always choose not to take the money.  The second thing that we could do would be to set back the dates so as to give them a reasonable opportunity to see if that possibility exists.  The third thing we could do is allow the Department of Education to decide whether they had a reasonable opportunity to merge or not.  But I'm very much opposed to a system that sets up a sham affidavit for purposes of ...  of pretending ...




SENATOR BEUTLER:  ...  that this money is given to encourage consolidation or merger or unification when I think that provision does nothing whatsoever to do that.


SENATOR BROMM:  Is there another instance in financial in state aid to schools that you're aware of where we have inserted such provision that relies upon ...  upon the consent of other districts or they have to give the money back if they aren't able to consummate it?  Have we done that in state aid prior to




this that you're aware of?


SENATOR BEUTLER:  Uh ...  not ...  well, in the unification bill itself,...


SENATOR BROMM:  Right, that's not...


SENATOR BEUTLER:  ...  Senator.


SENATOR BROMM:  ...  passed yet, but I mean...


SENATOR BEUTLER:  It's not passed yet but it's...




SENATOR BEUTLER:  ...  the same kind of mechanism that's in the unification bill itself.


SENATOR BROMM:  Right, but I mean in state aid that we have passed and it's been given to districts and placed in law.  Can you think of an analogous situation?


SENATOR BEUTLER:  Offhand, I cannot.


SENATOR BROMM:  Thank you, Senator Beutler.  Members of the Legislature, we have here...we are heading down a path that I think is a very dangerous precedent and if I were Lincoln, if I were Omaha Westside, if I were Papillion, I would be very nervous about this.  Because if we're going to enact a punitive statute like this, I would say that you could be next, and that's not the way and that's not appropriate...




SENATOR BROMM:  ...  for funding education in Nebraska.  We have a fine ...  we have so many good things coming out of education in Nebraska.  People are trying to do a good job.  I think this is clearly a punitive measure.  There is a perception that all merger or consolidation saves money.  That's simply not the truth.  That is not the fact.  Each case has to be looked at on an individual basis as to whether it makes money or not.  My understanding what the Governor and what the Legislature was




going to do with Senator Coordsen's proposal was provide a oneyear small measure safety net to help those schools who had their legs chopped off at the knees, one time, temporary, one time only.  It is not appropriate to tie these ...  to tie the strings to the extent that this amendment would do so and I ...




SENATOR BROMM:  ...  urge the body to not adopt the Beutler amendment.  Thank you.


SPEAKER KRISTENSEN:  Senator Hartnett.


SENATOR HARTNETT:  Mr. Speaker, members of the body, Senator Coordsen, could I ask you a question?


SPEAKER KRISTENSEN:  Senator Coordsen, would you respond?


SENATOR HARTNETT:  On your amendment, on the page 1 on (b)(1) (sic-(i)), dealing with this...  starting to the merge and so forth, signing a letter and so forth, Senator Coordsen, how long do you see this ...  either to merge, consolidate or unify involving how long a process do you see that taking?  You know, could I ...  say that you and I are going to merge,...




SENATOR HARTNETT:  ...  you know, and would ...  would still be merging (laugh) at the year 2025?  Or is that ...  maybe I'm miss...




SENATOR HARTNETT:  ...  maybe it's someplace else, Senator Coordsen.


SENATOR COORDSEN:  Yeah, you're ...  you're in the right section, Senator Hartnett.  on page 2 it says these affidavits to ...  to ...  that it is the intent to merge shall be filed with the State Department of Education on or before August 1, '98.  Moving back to the first part of (b)(1) (sic--(i)), it says that those have the intent to merge, consolidate or unify with at




least one specified high school district by June 1, 199.  So there's a ...  there's a specific date as far as the...


SENATOR HARTNETT:  So...  so if you and I are going to imerge...




SENATOR HARTNETT:  ...  then we'd have to complete it by June 1,




SENATOR COORDSEN:  That's right, and the reason June 1, 199, is, according to what I was told by Education Committee Counsel, is that is the date that mergers and consolidations have always taken place.




SENATOR COORDSEN:  Thirty days before the start of a next school year.


SENATOR HARTNETT:  Okay.  What's...


SENATOR COORDSEN:  And ...  but the affidavit has to be filed before any money is given to a district.


SENATOR HARTNETT:  It...  it has to be filed by this ...  by this August.


SENATOR COORDSEN:  By August 1, '88 (sic--'98), one time, one-time payment that's made in September and the affidavit has to indicate that the district plans ...  has the intent of merging with one or more specified high school districts by June 1, 199.


SENATOR HARTNETT:  oh, okay.  What's ...  what's official ...  official misconduct?


SENATOR COORDSEN:  I have no idea.  it says a misdemeanor....  let's see, where'd I find the words here?  Okay.  It's "official misconduct pursuant to Section 28-924." That again is Counsel's suggestion...


SENATOR HARTNETT:  Suggestion, okay.




SENATOR COORDSEN:  ...  and there is...  it's a misdemeanor penalty.  I cannot tell you exactly what it is.




SENATOR COORDSEN:  We could certainly look it up very quickly..


SENATOR HARTNETT:  What ...  what if we sign this, the two of us sign this merger agreement?  We're going to do it by June the 1st, 1999, and the only penalty would ...  we wouldn't have ...  I think, Senator Beutler, we wouldn't have to give the money back.  We'd just have this misdemeanor.  Is that...  is that correct?


SENATOR COORDSEN:  The discussion, yes, the discussion that Senator Bohlke and I had that in addition to this ...  this misdemeanor because of the fact that for most of these schools the only opportunity they have for continuing would be to override the levy caps as provided in 1114, that the property owners in that district would probably take quite seriously the not carrying through with ...  with a sworn affidavit.




SENATOR COORDSEN:  And that rather ...  there was mention made earlier of county attorneys but I rather suspect the property owners who are going to be subjected to substantially higher levies if this didn't happen would be the instigator of the...of the complaints.


SENATOR HARTNETT:  Thank you, Senator Coordsen.


SPEAKER KRISTENSEN:  Senator Coordsen.


SENATOR COORDSEN:  Thank you, Mr. Speaker, members of the body.  Again, I have gotten enough questions over the noon hour that I would want to reinforce what Senator Bohlke told us just before re noon, that I did give this list this morning to the members of the body at the request of Senator Beutler.  All this list is are those schools who receive or who would have less than 90 percent of their available resources available to them for the '98-99 year compared to this year.  It has no bearing on what




April 1, 1996


amount of money any individual district would get or, in fact, if any individual district would get money under this.  Some of it quite probably is dependent upon what $1.10 would raise when ...  when the valuations are certified.  But this is simply a listing of the, what, 61 schools I think in the state that were below ...  that were at 90 percent or below.  I should indicate to you, for whatever reason and to whomever may listen, that was pointed out to me this noon that many of these schools in this list, we talk about consolidation, how easy that is to do, this schools in this list, many of these range from 150 square miles in area up to nearly 600 square miles in area.  And that is one of the reasons why Senator Dierks and I have an interim study resolution for the Education Committee to look at to find out why the (LB) 806 system, with the one tier for everyone other than the sparse and very sparse, did not work.  Because on this list Of schools that are tremendously negatively impacted in their available resources are many schools that any member of this Legislature, no matter where you're from, would say these are core schools and ought to be in that location for as long as a school is needed.  These aren't all the little ramshackle, lean-to schools that some people might think they are, but they're some pretty good size schools for rural schools in here from ...  anywhere from three, four, five hundred in student population.  But because of how they're located it's very difficult for them to qualify for any state aid under the current formula.  And I happen to believe, and this is a little aside to this, that we need to provide some mechanism of these schools to continue for a year to avoid doing a levy override.  Because I'm convinced that after they do the levy override, and it will grow in numbers, that unification will have no value, that anything else we do will have no value, they're not getting any state aid, and we will have a large portion of Nebraska that, in spite of all of our efforts that we've done for the last 30 years for property tax relief, will in fact have record high property taxes because of how we distribute state aid to the schools.  That is going to happen.  You read in the paper every day that it is happening.  This is an attempt of mine and the Governor's to try to forestall that to see if there may be a better system, if that better system is unification,...






SENATOR COORDSEN:  ...  if that better system is the creation of another tier if that should be, if there's a mathematical fault in the current (LB) 806 distribution formula that's being used.  I don't know what the reasons are.  I only know that there's a strip of schools primarily over the east central part of the state, one after another down the road.- that have a major negative impact and are not going to be able to reduce their funding and have any kind of a viable system without something else happening, whether that's a levy override or some readjustment in how we compute state aid.  But it takes time to do that.  Thank you.


SPEAKER KRISTENSEN:  Senator Cudaback announces he has the following guests visiting the Legislature.  It's the Dawson County Area Development Leadership group.  They are in the north balcony.  Would you please stand and be recognized by your Legislature.  Senator Willhoft's proud to announce he has the following special guest visiting the Legislature.  It is Hildur Willhoft from Central City.  It is his mother and with her is Ramona Bock from Honey Creek, Iowa.  Would you please stand, under the south balcony, and be recognized by the Legislature.  Thank you for being with us.  Senator Bohlke.


SENATOR BOHLKE:  Yes, Mr. President and members.  At the beginning today I thought I thought I've had ...  need to make an announcement to all of you.  I wasn't quite sure if I really needed to, but I think because of the importance of this piece of legislation I need to, that I have filed a conflict of interest and so normally when you do that I'm not sure you have to announce why, but because of a personal situation, an employment situation with my daughter-in-law in one of the affected schools who is a probationary teacher, either way with this it has an impact.  And so, with that, I want you all to know that I have filed that and therefore I will be a "not voting" on the bill.  I wanted to make that announcement when as many people were here as possible.  Thank you.




SENATOR BEUTLER:  Senator Kristensen,.  members of the Legislature, the amendment that I'm putting forward in front of you today is not...  is not to change the expressed intent of this




particular amendment, but rather to ensure that the expressed intent or to better assure that the expressed intent of the commitment in fact happens.  Senator Bromm had indicated, for example, that perhaps we shouldn't be tying anything to this, and yet Senator Coordsen's focus and intent in that whole subparagraph is to agree that what this money is about is encouraging consolidation, merger or unification.  That's the whole point to the affidavit.  That's the whole point to the whole paragraph.  That's the whole justification for what we're doing here today.  This amendment simply helps ensure that that happens.  The weakness of the current provision I think is so apparent.  For example, it requires that by August 1 of 1998 that the affidavit be turned in to the Department of Education and that affidavit that's to be turned in August 1, 1998, is supposed to...  supposed to identify a specific high school district which is to be the subject or the partner in the merger, consolidation or unification.  Well, obviously by August 1 of this year no one is going to be able to complete or even get very far with a unification or a merger or a consolidation, and so apparently the intent of the affidavit is something to the effect of, I mean could be as little as we made a phone call over to the school district next door and we think maybe they would be interested, so we sign an affidavit saying that we have an intent to merge, consolidate or unify with that particular school district.  I mean that's how vague this is and that's what, in fact, will happen and must happen because August 1, 1998, is not very far away.  So, obviously, this affidavit means nothing at all.  And if, subsequent to the affidavit, nothing happens, nothing at all happens and the money is given to these school districts, there is no mechanism at all for getting the money back.  The money's just gone, floated away on some affidavits.  I would like to try to help Senator Coordsen facilitate the stated purpose of his amendment and if we could reach some sort of agreement on that I see no reason why everybody shouldn't ...  why there shouldn't be a fairly broad ..consensus on this matter.  But the unwillingness to do what's necessary to make it really happen makes me think that there is not really an intent there to make that happen and that perhaps the whole purpose of subsection (b) is simply to make the amendment germane and nothing more, because it's certainly not germane without subsection (b) that mentions unification.  The amendment otherwise has nothing to do...






SENATOR BEUTLER:  ...  with the unification bill.  So, with that, if this is something the Legislature wants to do, surely it's something that we should do right and something we should comb through carefully.  Can you imagine how we're going to look to the public when Omaha Westside gets $600,000 out of a bill that's supposed to be a life raft?  So let's take a hard look at this and do what we need to do in a reasonable kind of way.  Thank you.




SENATOR DIERKS:  I call the question, please.


SPEAKER KRISTENSEN:  Question's been called.  Do I see five hands?  I do.  Question before the body is, shall debate cease?  All those in favor vote aye; all those opposed vote nay.  We're voting on ceasing debate.  Have you all voted?  Please record.


CLERK:  25 ayes, 0 nays to cease debate.


SPEAKER KRISTENSEN:  Debate has ceased.  Senator Beutler, you're recognized to close.


SENATOR BEUTLER:  Mr. Speaker, members of the Legislature, just to repeat, essentially, effectively what this amendment does is not to change the focus of Senator Coordsen's amendment whatsoever.  His focus was to concentrate and to give money to those systems that have an intent to merge, consolidate or unify.  That's in the amendment.  As an incentive mechanism, as an assurance to those of us, to the taxpayers, who are giving out this money that that intent is fulfilled, I am suggesting this amendment which says that the funds shall be returned if the receiving district does not in fact merge, consolidate or unify prior to June 30 of the year 2000.  And if persons interested, if Senator Coordsen or those interested in this particular amendment were interested, I would be willing to add to that that the Department of Education can waive such repayment for the reason that no reasonable merger,, consolidation or unification was possible.  There are things we




can do here.  I think this amendment, in and of itself, if you should see fit to endorse it, will bring about a more rational approach to this particular question, so I hope you can see fit to support the amendment.  Senator Coordsen's money would go not just to sparse or very sparse districts, but would go to all kinds of districts across the state, several of which I know probably should not get this money and we cannot be told ...  we are not told, in fact we are told that it cannot be said who will in fact get this money, so I think we're left with a lot of uncertainty and the least we can do in this sea of uncertainty is to be sure that a mechanism is in place to get the money back if the purpose of the amendment...  if the purpose of Senator Coordsen's program is not fulfilled.  Thank you.


SPEAKER KRISTENSEN:  You've heard the closing.  The question before the body is the adoption of the Beutler amendment to the Coordsen amendment.  All those in favor vote aye; all those opposed vote nay.  Have you all voted?


SENATOR BEUTLER:  Record vote.


SPEAKER KRISTENSEN:  There's been a request for a record vote.  Please record.


CLERK:  (Record vote read.  See pages 1638-39 of the Legislative Journal.) 11 ayes, 19 nays on the amendment.


SPEAKER KRISTENSEN:  The amendment is not adopted.  The following guests are visiting the Legislature and I believe they're just leaving.  They're guests of Senator Witek.  They're 75 fourth graders from Trinity Christian School in Omaha.  Would you please wave to us so we can welcome you to the Legislature.  Thank you for being here.  Next item, Mr. Clerk.


CLERK:  Senator Beutler, I now have Floor Amendment 675, which strikes the new language on page 4.  (FA675 is found on page 1639 of the Legislative Journal.)




SENATOR BEUTLER:  Senator Kristensen, members of the Legislature, the language on page 4 of the bill is the section




that dips into the Cash Reserve Fund and pulls money out of the Cash Reserve Fund in order to bring this within our current year budget.  Now I don't know what our general attitude is going to be towards pulling money out of the Cash Reserve Fund.  I'm not sure I'm against it, I would like to hear a little discussion, but it seems to me that either we should be doing one of two things:  either admitting that there's a large amount of money in the Cash Reserve Fund and this is no big deal and that this might be available for other measures that are equally important this year if it's necessary to stay within the budget; or if we intend to stick strictly to Senator Wehrbein's budget and leave in the Cash Reserve Fund what is there without statutorily transferring it, then ...  then that's what ...  then that's the attitude we ought to take.  So, Senator Wehrbein, if I may ask you, could you ...  could you just comment generally and as specifically as you can get on whether this four-plus million that is the subject of the current bill, whether that can be accommodated within the current budget or whether it's necessary...  is it necessary to take money out of the Cash Reserve Fund in order to do this program?


SENATOR WEHRBEIN:  Senator Beutler and members of the body, Senator Kristensen, I ...  it depends on what all you have In mind to do yet.  If there's a veto override of (LB) 1110, we're going to return $20 million to the sheet.  By the way, Appropriations Committee are recommending that this morning.  That will bring $20 million back on to the sheet, so we'll be back above the line.  If you do not pass any more bills today or tomorrow or next week, we will still have that kind of money left.  if there's some more vetoes there will be room.  If...  if we do not pass all the bills that are here there will still be room.  So there's lots of "what ifs" before we can decide that final decision.


SENATOR BEUTLER:  Senator, we're faced with a decision today of whether to transfer four million out of the Cash Reserve Fund and I assume that this bill will move on in some form to Final Reading.  Would it be your advice that we transfer this money or not transfer this money out of the Cash Reserve Fund?


SENATOR WEHRBEIN:  Well, I've been very protective of the Cash Reserve Fund.  I would prefer to leave the Cash Reserve Fund




where it is, especially in light of the potential income tax cuts.  It's still a personal feeling.  obviously, the Cash Fund Reserve is fairly high.  My chief concern, frankly, is if we start using Cash Reserve Funds for whatever, including 1219, there may be other points of interest that people will have in using Cash Reserve Funds.  I honestly don't see that at this point, but when we're carrying the kind of Cash Reserve Fund we are, that's always a temptation.  On the other hand, I still firmly believe we are taking a risk into the future as to about the status of the economy, the stability of the economy.  Obviously it's good and I've had conversations this morning that many think it's going to continue to be on the high that we're on.  I can't predict that any better than anyone else, but I do think that that's something that we ought to be exerting caution about.


SENATOR BEUTLER:  Senator, could...  could I ask you to go a little further and just describe again, and I know you've done this for us before, but I think it's good to keep in mind at each little stage here how much money is in the Cash Reserve Fund and what do we know of now that is or may be called upon or that is or may deplete that particular Cash Reserve Fund in the future, and maybe specifically with regard to the income tax measures, since those seem to be possibly the most serious call on the reserve, what ...  what affect that might have on the total that is there; what the total is and what effect that might have.


SENATOR WEHRBEIN:  Well, we have an estimate and I'm not ...  this may not be 100 percent current, but it's fairly close at this point.  We have an estimate of the cash ...  well, I've got ...  I've got to find it exactly, of $132 million at the end of ...  by June 30 of this year, $204 million by the June 30 of 1999 under our present pattern.  We've added ...  we have not ...  that's under present predictions with revenue projections based on the forecast in February and we've had, if you'll look in there, that is based on a fairly strong revenue prediction or growth of revenue.  Obviously, all these are subject to projections at this point.  We factored that in somewhat in the Appropriations Committee using the fairly, I'll call it, strong or maybe you could say high side of revenue growth, BO that is where we're projecting the Cash Fund to be and, remember, we have to base it




on the projections.  If we'd have a strong month here in March, that will not affect our forecast officially.  It may affect our forecast unofficially, but not officially.  And that ...  what I'm working from is page 16 in our blue manual, by the way.


SENATOR BEUTLER:  And then of the $132 million at the ...  at June 30 of this year, $204 million June 30 of the following year, and what happens with an income tax cut, both with continuing the existing cut and with a deeper cut of 2 percent?




SENATOR BEUTLER:  What happens to that reserve, more or less?


SENATOR WEHRBEIN:  Well, with the ...  the income tax cut is factored in using General Fund money and is not ...  or variance from the minimum reserve, so we are not getting into the Cash Fund at this point.  Now I understand there's some drafts of additional income tax cuts, I think one of which at least proposes to take from the Cash Reserve to fund a additional income tax cut.  Somebody can correct me if I'm wrong on that, but that's the way I understand it.


SENATOR BEUTLER:  Okay.  Thank you, Senator Wehrbein.  Members of the Legislature, I think I will leave the amendment and ...  and gather your opinion on whether this is a good thing to do or not to do.  Thank you.




SENATOR CROSBY:  Thank you, Senator Beutler.  Discussion on the Beutler amendment?  Senator Elmer.


SENATOR ELMER:  Thank you, Senator Crosby.  What I have to say really isn't directly to Senator Beutler's amendment, but it seems that this whole section about intent is a sham, and if we want to look at the bill honestly, we just should delete this section.  Then it becomes what it really is, is a one-time cash bridge so that these school districts can avoid having to ask the voters if they truly support their school.  I would suggest to you all we really need to do is not pass this amend ...  not add this amendment and let those schools fund themselves by asking




their voter s if they want to do it.  I have no problem with local people deciding they want to support their school by adding some tax levy to themselves with a vote, just like a bond issue, but I see no reason to change our strategy that we've put in place the last two or three years as far as the state's commitments to reduce property tax if the people out there are willing to pay to keep their operations in place.  Thank you, Madam President.


SENATOR CROSBY:  Thank you, Senator Elmer.  Senator Vrtiska.  Senator Vrtiska on the Beutler amendment.  He waives off.  Senator Stuhr on the Beutler amendment.


SENATOR STUHR:  Thank you, Madam President and members.  I rise in opposition of Senator Beutler's amendment and in support of Senator Coordsen's overall amendment.  Just a couple things that I wanted to point out.  Senator Beutler a few minutes ago said in the amendment that we were talking about that the money would be gone, it would be just floated away.  We're talking about kids and their education.  We're not talking about just having the money float away.  We're talking about salaries for teachers, salaries that will enable programs to continue, and we're talking about basic programs, not fluff programs.  We're talking about one teacher in a school that teaches one entire program area.  We don't have the luxury in some of our smaller schools to have a number of teachers in a particular area.  A couple things that I wanted to point out from a handout that we received from the Nebraska Department of Education, and it's dated 11-28-97, that talks about the available funds, tax funds and the gains and losses in state aid from LB 806 and the combination of 1114.  According to this printout, Lincoln gained ...  the Lincoln Public Schools, and I'm just pointing this out that we seem to be having this debate in ...  that is actually centering around the urban and the rural schools, that they did gain $17 million in state aid.  Omaha Public Schools gained $23 million.  They are now at 107 percent of their budget needs, according to the amount of tax monies available and the amount talking about some of state aid that they received.  And we're AL, of these schools that are down to receiving only 70 percent of budget needs, so we're talking about $4.5 million that, as the bill was originally introduced, would address the needs of about 60 schools.  We're now down to less than 40 schools.  But we are




talking about providing educational opportunities for these students and I think that's the most important thing that we have to keep in mind.  Thank you.


SENATOR CROSBY:  Thank you, Senator Stuhr.  Before we continue, I will announce some guests.  Senator Raikes has, as his guest under the north balcony, Martin Falk (phonetic) from medical...  a medical student from Germany.  He is accompanying the doctor of the day.  Would you please stand and be welcomed by the Legislature.  Also under the north balcony, Senator Schrock has guests,, Patrick Bayard (phonetic) Hamilton Church Kelly (phonetic), Mary Ann (phonetic) Kelly (phonetic), Catherine E.  (phonetic) Kelly (phonetic), and Thomas E.  Kelly (phonetic), all from Rock Falls (sic), Nebraska.  Would you stand and be welcomed by your Legislature.  And under the ...  under the south balcony, Senator Willhoft has, as his guests, Mona Dubas from Grand Island, Marjorie Bingston (phonetic) from York, and Marlene McMullen (phonetic) from Upland, California.  Would you all stand and be welcomed by your Legislature.  Continuing the debate on the Beutler amendment, Senator Coordsen.  Senator Coordsen.


SENATOR COORDSEN:  Sorry for the delay, Madam President.  I turned my light on only to indicate that the reason that we chose to make the appropriation in the manner that's provided, that is out of the Cash Fund, is that this is, in fact, should it be adopted, a one-time, one-year appropriation that would not become part of the ongoing General Fund budget appropriations from year to year or anything like that and it seemed that it fit better not to impact ongoing programs with a one-time appropriation and that the Cash Fund was, since it's.  all taxpayers' money anyway, seemed to be the better fund from which to get the money, so that is the reason that it is in there, Madam President.


SENATOR CROSBY:  Thank you, Senator Coordsen.  Senator Wickersham.


SENATOR WICKERSHAM:  Madam President, members of the body, I'm rising in opposition to Senator Beutler's amendment.  I believe it's entirely appropriate that we fund this kind of activity out of the Cash Fund if we're going to fund anything out of it.  it




is a one-time expenditure instead of an ongoing one and, because the Cash Reserve is composed of dollars that we do not think are going to be ongoing dollars, certainly not appropriate to fund ongoing programs out of them.  But we can use them on this kind of a basis for one-time expenditures and if we're going to adopt Senator Coordsen's amendment this is, in my mind, an entirely appropriate funding mechanism.  I did...  Senator Wehrbein made some remarks about the current status that I tried to follow.  I understood Senator Wehrbein's remarks that said that if we overrode the veto of (LB) 1110 that the current status would be in a plus category.  I agree with that statement, but it is also possible that we would override one or more of the other vetoes of the Governor that he has delivered thus far and, if we did so, that would reduce the plus side of our status.  Now, as an individual member, I've been attempting to follow our current status.  It does look likely to me that for the first time since I've member ...  been a member of the body that we will be able to conclude the session with a positive status from the legislative actions.  I think that if we're able to accomplish that, that is something that we should be proud of as an institution, as a legislative body.  I don't know that it's ever happened in my experience in this body.  I certainly don't remember it happening, and I don't know how many years ago that would have happened.  I think if we can go home and we have produced a fiscal status from the budget bills and the A bills that we've delivered to the Governor that's in the positive, we owe ourselves a pat on the back.  I think we will have demonstrated to the citizens of the state that we can be fiscally responsible, that we will not spend everything that is available, and I am anticipating that we'll be able to do that with the income tax reduction that Senator Wehrbein also mentioned that's contained in (LB) 1028.  Perhaps not the amendments that are being proposed to it, but certainly with that bill, in principle, we'll be able to, I hope, conclude our session with a positive fiscal status with or without gubernatorial vetoes.  And we do have a considerable amount of potential for doing that.  We would not have that potential or as much potential for doing that if we funded Senator Coordsen's amendment out of General Funds and, frankly, I don't think it's necessarily appropriate to fund this out of General Funds.  It is appropriate, in my view, to fund it out of the Cash Reserve as Senator Coordsen is suggesting in his amendment.




SENATOR CROSBY:  Thank you, Senator Wickersham.  Senator Wehrbein.


SENATOR WEHRBEIN:  Madam Speaker, members, I'm just going to expand a little bit on what I said earlier, carry it a step further.  We were talking about the amount in minimum reserve actually at this point in time and I suppose I ...  now through next week I'll remind the body.  We are $15 million below the line.  If we override (LB) 1110 that would restore some of that money because it's the way it's accounted for.  It comes back into the General Fund for appropriations.  And Senator Wickersham is correct, we...  it would mean no vetoes of the mainline budget issues in the package.  But what I really wanted to rise and talk about is the second line in the out years, 2000-2001, which we haven't been budgeting out to.  This is strictly an estimate out into the future, but it does ...  we are $127 million below the line in the out year in the end of June 30, 2001, under our present scenario.  So it's not necessarily a big cause for optimism, I want to...  if ...  even whatever we get in line this year and I ...  stay above the minimum reserve, we have jeopardized our out years already to some extent.  And we have not...  there's no official format for forecasting that far out, realizing that it's very tenuous, it's very risky in a way to forecast what is out as much as four years or three years.  But we have started putting that on the agenda more or in the status so that you recognize what impact it has, spending today, how ...  what effect it has on those out years.  And so even though it's a good guess at best, it is something I think we need to take into account that everything we add to now also multiplies in those out years.  I just wanted to call the body's attention to that, so that we don't get to feeling too euphoric here.


SENATOR CROSBY:  Thank you, Senator Wehrbein.  Senator Elmer.


SENATOR ELMER:  Thank you, Senator Crosby.  I wonder if Senator Coordsen would yield to a question, please.


SENATOR CROSBY:  Senator Coordsen, will you yield for a question?






SENATOR ELMER:  Senator Coordsen, why don't we just allow these schools to go to their voters and ask them if they want to override instead of providing this?


SENATOR COORDSEN:  Senator Elmer, for 30 years the Legislature has been doing property tax relief primarily concentrated in state aid, certainly in recent times.  The net result of that has been that Nebraska is still ranked number four in the percentage per $100 of valuation that taxes are levied on real property and agriculture.  Number four.  Our national ranking is somewhere between 13 and 15, depending on who you talk to, which means that we have been fairly successful on residential and commercial industrial property of lowering property taxes, but not on agricultural property.  If you want further conversation on that, you would look at the February '97 Legislative Research publication that will tell you there has never been a drop in the percentage or the levy assessed against the $100 of actual valuation.  I'm not talking about 80 percent.  So what would happen under that is that we would simply continue to have property tax relief for other classes of taxpayers but never for agricultural property.  Thank you.


SENATOR ELMER:  Senator Coordsen, I understand of your frustration with agricultural property tax and I share that very deeply, but we're following a process here that I think is just putting off that same kind of problem.  The local school districts are going to need to find ways to become more efficient.  I sincerely believe that.  In many instances, I know there will be some instances at least across the state, where opportunities to make ...  to merge may not exist and I think that you'll need to deal with that next year.  But we have a situation now, are we going to start to look like, well, if we just put off this, if we just don't do anything, the Legislature's going to come to our rescue?  I don't think we want that side of it either.  I would suggest on this bill at least that we get...  just delete the section that talks about an intent to merge, because it's a sham, and do what the bill says; that it's we're ...  we're backing off, we're not going to do what we say and next year come to us again and we'll ...  and we'll do it again.  Thank you, Senator Crosby.




SENATOR CROSBY:  Thank you, Senator Elmer.  Senator Beutler, there are no further lights.  Would you like to close on your amendment?


SENATOR BEUTLER:  Senator Crosby and members of the Legislature, I think the Legislature is satisfied that taking the money out of the Reserve Fund is appropriate in this case and, frankly, I have no objection to that either, given the information we were provided by Senator Wehrbein.  So, with that, Senator Crosby, I would withdraw the amendment.


SENATOR CROSBY:  No objections?  It is withdrawn.  Mr. Clerk.


CLERK:  Next amendment, Senator Beutler, strike Section 18, 1(b)(1)


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  I would like to pass over that temporarily.


SENATOR CROSBY:  It's passed over.


CLERK:  The next amendment I have by Senator Willhoft.  (FA678 is found on page 1639 of the Legislative Journal.)


SENATOR CROSBY:  Senator Willhoft.  Senator Willhoft.


SENATOR WILLHOFT:  Madam Chairman, I'm sorry, I couldn't get through the traffic jam there.  Madam Chairman and members of the body, I have an amendment that I would like to offer to Senator Coordsen's amendment and what this amendment would do would allow some schools in the 34th District that are hurt very severely by the results of the last Legislature.  Out of 14 K-12 districts in the 34th District, only one of them had 100 percent funding after the lid bill and (LB) 806.  So echoing what Senator Coordsen has said, obviously there are some flaws in the way that we figure our state aid because there is that belt of schools through the central part of the state that have suffered some severe losses.  Sandy Creek is the example that I like to use because they probably had the severest loss in our district.  As I mentioned last week when I was speaking, Sandy Creek is one




of those districts that has reorganized much as this body and people in the school community have said schools should do.  They combined four towns, their schools.  They built a new school in the middle of a corn field in the late seventies.  They've operated very successfully as a Class C-I school or C-II.  I don't...  I get confused in the classes a little bit, but at least they have operated very successfully.  They have had three title basketball teams in the girls' side of sports, and every one of those girls are on the honor roll in their school, an important factor in their school and their community.  They took a hit of $460,000 and, with that hit, in their next...they're having an override election on April the 7th and they're looking at going to $1.25 for three years to bail them through this period of time.  They don't have a lot of opportunity to unify or to go with other districts.  They have the unique situation of the Animal Research Center kind of being right in the middle of their combination of schools around them--Clay Center, Harvard, and possibly Giltner or Trumbull.  But the Meat Animal Research Center is a block of about, and I don't know the exact acres, but it's six or eight miles wide and all the way from Clay Center to Hastings.  There aren't very many roads across that ...  that Research Center so that chunk is out of their district and sort of separates their schools, making it more difficult for them to unify or consolidate with those other schools.  But just to give you an idea of the kind of cut that was brought about in their state aid and their funding ability, if they do not pass the override, they have already issued rif notices to eight teachers.  Eight teachers in a school of 450 to 500 students does not allow you just to add a few more students to each class and keep your program.  They are going to have to cut their library to the minimum amount that they have ...  that's allowed in Rule 10.  They're going to cut their voc ag department.  They're going to cut their physical education department.  They have to cut their music department and they have to cut their math department.  Now if they do and are successful in their override going to $1.25 for the next three years, then they may only have to rif two teachers.  But my point is that at a school of that size and you start riffing teachers, it's not a matter of just putting a few more students in the classroom and going on with your current program.  It cuts programs.  And when you cut programs in these schools and especially in the rural schools, you're hurting kids.  And




that's my whole point of this amendment.  What my amendment would do is, on page 1 it...  line 7, it would strike "ninety" and insert "eighty-seven and one-half".  In line 9, after "if" add "one of", because I'm not real confident in the bill drafter and that this means one of the following choices.  When I read it, it looks like it means you have to qualify on all those choices and, if that's the case, you'd only get this aid if there were an error.  And then strike on line 10 of the Coordsen amendment beginning with "(a)" through "and" in line 15, and in line 16 strike "(b)" and insert "(a)".  What that would do, it would remove the requirement that they could not exceed the 2 percent growth, plus or minus, and however that that combination of formula works.  This would leave Senator Coordsen's amendment relatively intact and more in line of what the green copy was at the beginning.  It does put some stipulations on Senator Coordsen's amendment, as he has indicated and liked and has been able to negotiate.  It would cut down the number of schools to 53 that would have a possibility of sharing in, if you wanted to go like Senator Beutler's terms, a windfall or whatever, but it would allow those schools to qualify, give them at least enough breathing room to make a legitimate and a better choice of where they go with unification, consolidation, a merger or whatever.  What I see happening, and I see it happening in my district with one of the schools, is ...  what I feel or would consider anyway is because of the pinch they are on budget and their desire to educate students, that they really are making some choices that may not be good choices in the long run because they are in such a pinch of time to do it.  I don't look at this as being a bail out of (LB) 806.  1 agree with Senator Coordsen that we do need to study that.  There could be some flaws in that language and I think maybe the turmoil that we're causing, particularly in the rural areas and in the urban areas, that ...  that ...  that it's obvious that it may not be entirely equitable.  You know, and I can appreciate that Westside does not get to participate in some of the state aid that they have in the past, but I see a school as large as Westside where they can increase their class size.  a little bit and not cut programs, that is not the luxury that small, smaller rural schools have.  So, with that, I would like to...  I don't see Senator Bohlke and she asked if I would give here a little time.  I think maybe she...


SENATOR CROSBY:  Senator Bohlke.  You have about two and a half






SENATOR WILLHOFT:  I would yield the rest of my time to Senator Bohlke.




SENATOR BOHLKE:  I'm sorry, Madam Chairman, I was involved with another discussion.  I'll give the time back to the Chair.


SENATOR CROSBY:  Thank you.  Senator Willhoft.  Sorry.  Discussion on the Willhoft amendment?  Senator Vrtiska.


SENATOR VRTISKA:  Thank you, Senator Crosby.  I've been listening with some attentiveness to what Senator Willhoft has been saying and I think it's very typical of what all ...  many of us in the rural areas are witnessing.  And I think Senator Bohlke has this letter that I got from one of the school districts in my area where they talk about a school, out of a class of 19 they had an average score of ....  well, anyway, four scored over 30 and one 35, which is...  36 is perfect on the ACT score.  And I could go on and name down the line all of these accomplishments that's happened in some of these schools of this size.  And, yet, at the same time we're saying to them, no, you don't get any support; you can stay down...  I think they're at 77 percent under the formula that was devised under ...  under (LB) 806, but we're saying to them ...  we're not saying to them, you're doing a good job.  We're just saying you got to go on doing what you're doing with the money you get and that's the way it is.  I said last year when (LB) 806 passed that we were going to destroy some of the small schools and I think that we are witnessing that right now.  Take a look at some of these small schools.  When I'm talking about small schools, I'm talking about almost the majority of schools in my district.  Not one of those schools fits under the formula that we're talking about today, not a one of them.  They all have had problems and we say, well, if you've...  if you haven't cut your budget, you had a loss of a few students and you don't qualify.  How in the world do you cut your budget and dismiss a teacher and still continue to provide a quality education?  I don't see how the two go hand in hand.  It's really bothersome when you think about the problems that these small schools are having




trying to in fact get an education, and then we talk about unifying.  I I'm sure some of them would unify, but if we make these requirements so difficult, then you're going to discourage that.  And I suspect probably as we go down the road we'll see more and more of these small schools closing and we'll have to find some place for these kids to go no matter how far it is.  And I think the bottom line is how much are the savings going to be?  Well, I'm here to tell you that I don't think they're going to be very great because when you add in all of the Costs ....  it's always interested me, we talk about what the cost of the education is and how we can save money by transporting these kids greater distances with school bus and so forth and so on.  In that formula we don't talk in ...  take into account that the parents who have to drive further to go to ball games or go to other school events, that's also a cost that somebody has to absorb.  I think the whole premise is just skewed so that the desire for many in this body is to get these schools out of business.  Get rid of them.  I'll accept the fact that some of the smaller schools, and I would never deny a need to consolidate, need to unify, need to come together and try to cut out some of the administrative costs and some of the other things that are incurred in our systems, particularly when they're small, but it's always interesting to me we don't, in these small schools, we don't have swimming pools, we don't have golf courses, we don't have tennis courses...  courts, and some of these kids are doing awful good without that.  You look at the scores on some of these kids.  When they're average is above the national average by, for example, this school I'm talking about, their average score is 26 and the national average is 21.  Nebraska is 21.7, and the national average is 21.01.  And we say they're not doing a good job?  I think we need to look what the finished product is.  If we would actually devise a system where...


SENATOR CROSBY:  One minute.


SENATOR VRTISKA:  ...  we find out how well these kids are doing and what kind of a product they're turning out, we'd take a different look at how we are assisting in some of these schools to stay open and continue to provide this kind of education for our kids.  After all, that is the bottom line--what kind of a product is a school turning out and how successful are they?  I




have to also tell you this school tells me that 87 ...  87 percent of their kids that graduate go on to higher education.  That tells you those kids are not too doggone dumb and they apparently got a pretty good education and many of those, you can look back today, are very successful as doctors, lawyers, engineers, a great deal of professionals ...  professions that show the quality of the kids that are coming out of those schools.  And yet, at the same time, we're trying to deny those kids an opportunity to get an education.  Yeah, we can furnish them an education.  We can raise their local taxes.  As George said awhile ago, we'll see a time when property taxes will shoot up because maybe these towns will or communities will probably keep their school open no matter what it costs, and I guess you can't blame them.




SENATOR VRTISKA:  Thank you very much.


SENATOR CROSBY:  Thank you, Senator Vrtiska.  Senator Coordsen on the Willhoft amendment.  Senator Coordsen on the Willhoft amendment.


SENATOR COORDSEN:  Thank you, Madam President.  I apologize for the delay in coming in the map ...  there ...  coming to the mike.  I do oppose the Willhoft amendment.  The 2 percent and the other language is an integral part of making this bill, (LB) 1247, or AM4312 work.  I would also share with the body that we have, I think, reached resolution to the differences between Senator Beutler and myself on the issue of 4312 and will be probably substituting an amendment very shortly, as soon as we get it written out in form someone can read.  So thank you, Madam President.


SENATOR CROSBY:  Senator Willhoft.


SENATOR WILLHOFT:  Madam President, I would like to substitute the amendment that I just turned in for the amendment that we have just been discussing.


SENATOR CROSBY:  No objections?  The substitution is ordered.  Senator Willhoft, I'll recognize you to open on the substitute




amendment.  (FA694 is found on page 1640 of the Legislative Journal.)


SENATOR WILLHOFT:  What the substitute amendment does to Senator Coordsen's amendment, on page 2, line 5, after ";" insert "(iii) The local system contains more than 175 square miles;".  On page 2, line 6, strike the "(iii)" and insert "(iv)".  On page 2, line 24, strike beginning with "the" through "year" on line 26, and insert, "the growth in students calculated for 196-97 and '97-98 pursuant to Section 79-1025, except that growth in students is calculated for the local systems and may be negative for each year for the purpose of adding the two growth rates together, but the two-year percentage growth rate shall be zero if the sum of the two years' growth in students is negative".  What this would do, it would allow the schools, like Sandy Creek, that for some unknown reason had a drop in students, had a zero increase in property values and so forth, to qualify for this aid.  With that, Madam Chairman, I would turn the rest of the time back to the Chair.


SENATOR CROSBY:  Thank you, Senator Willhoft.  Discussion on the Willhoft amendment?  Seeing none, Senator Willhoft to close on your amend ...  Senator Willhoft, close on your amendment.


SENATOR WILLHOFT:  Madam Chairman, members of the body, I substitute this amendment because of opposition from members of the Education Committee to my previous amendment.  I think it accomplishes much the same thing.  It allows some of those schools, not all of them, in on Senator Coordsen's amendment.  I think it would be wise to do this.  I don't look at it as a gift.  I think it's a one time only thing to leave these schools enough time to make some legitimate decisions on where they're going and how they get there.  With that, I would urge the body to support this amendment and I also will support Senator Coordsen's amendment and LB 1219.  Thank you, Madam Chairman.


SENATOR CROSBY:  Thank you, Senator Willhoft.  The question is the adoption of the Willhoft amendment to the Coordsen amendment.  All in favor vote aye, opposed no.  Voting on the Willhoft amendment.  Have you all voted?  Senator Willhoft.  Request for a call of the house.  All in favor vote aye, opposed no.  Record, please.




CLERK:  11 ayes, 2 nays to place the house under call.


SENATOR CROSBY:  The house is under call.  Would all senators please record your presence.  Would those unexcused senators please return to the Chamber and record your presence.  Would all unauthorized personnel please leave the floor.  Senator Bohlke, Senator Brashear, the house is under call.  Senator Engel, there he is.  Senator Landis.  Senator Chris Peterson.  Senator Cudaback, Senator Wesely, the house is under call.  Senator Chambers.  Senator Brashear, would you like to check in?  Senator Chambers, would you like to record your presence?  Senator Willhoft, everybody is here.  Do you want call-in votes or roll call?  What do you want?


SENATOR WILLHOFT:  I think roll call..


SENATOR CROSBY:  Roll call vote?


SENATOR WILLHOFT:  I'd accept call-in votes.


SENATOR CROSBY:  I'm...  a roll call vote?


SENATOR WILLHOFT:  Oh, roll call.


SENATOR CROSBY:  Yeah, okay.  The question is the adoption of the Willhoft amendment to the Coordsen amendment and he has asked for a roll call vote.  Mr. Clerk, please call the roll.


CLERK:  (Roll call vote taken.  See page 1640 of the Legislative Journal.) 3 ayes, 20 nays on the amendment.


SENATOR CROSBY:  The amendment fails.  I'll raise the call.  Before we continue, Senator Cudaback has in the north balcony 53 fourth and fifth graders from Sandoz Elementary School in Lexington with their teachers.  Would you all stand and be welcomed by your Legislature, those of you from Lexington.  Also, also in the north balcony are 18 fourth graders from Howells Community Catholic School from Howells and their teacher, and they're guests of Senator Bromm.  Would all of you please stand and be recognized and welcomed by your Legislature.  Mr. Clerk, do you have items for the record?  And I did raise




the call.


CLERK:  Senator Jensen, amendments to be printed to (LB) 1129; Senator Beutler to (LB) 1174; Senator Bromm, (LB) 309.  New A bill.  (Read LB 341A by title for the first time.) I have Appropriations Committee report with respect to (LB) 1108 and a report with respect to (LB) 1110, and an override motion with respect to (LB) 1110, all signed by the Appropriations Committee.  (See pages 164148 of the Legislative Journal.)


Senator Bromm would move to amend the Coordsen amendment.


SENATOR CROSBY:  Senator Bromm, to open on your amendment.


SENATOR BROMM:  Thank you, Madam President.  This amendment which is before you, that I don't have a copy of at the instant time because we've been working on another one, is going to have a substitute.  The amendment that's before you I think is AM....  Mr. Clerk, which amendment is up right now?


CLERK:  Well, it's your handwritten amendment, Floor Amendment 679, Senator.




CLERK:  Page 1, line 16 it starts.


SENATOR BROMM:  Okay.  This amendment would have provided for a study in connection with the idea that you would have to merge, consolidate or have a unification and, as opposed to that amendment, I would like to substitute an amendment which I believe is now being copied and which I think has been signed on to by Senator Coordsen and Senator Beutler and I'll give...  if that substitution occurs I'll give them a portion of the opening.  I think the substituted amendment hopefully, Madam President and fellow senators, will be a compromise situation whereby the receiving districts that do receive money will have to make a good faith effort to have a merger...


SENATOR CROSBY:  Senator Bromm.






SENATOR CROSBY:  We need to go through the procedures here and ask for the substitution of the amendment.






SENATOR BROMM:  Does the Clerk have it in his hands?


SENATOR CROSBY:  No objection to the substitution?  So ordered.  Senator Bromm, continue on your opening.  (FA695 is found on page 1649 of the Legislative Journal.)


SENATOR BROMM:  Thank you, Madam President.  I will be very brief and I'll yield the rest of the time to Senator Coordsen and Senator Beutler, but I think what they've agreed to would basically require the receiving district that receives funds to return the money if they don't merge, consolidate or-unify prior to June 30 of 2000.  However, the temporary mitigation funds would not be ...  need to be returned if the receiving district is unable, as determined by the state reorganization committee, to merge, consolidate or unify despite good faith efforts, because the districts with which they would be expected to join with decline such merger, consolidation or unification.  It also strikes the, what some of us have referred to as, the punitive language, which says that if a board member, after signing the affidavit, if he signs it without the requisite intent, it's official misconduct under 28924.  It strikes that language.  I would ask, Madam President, if I could yield time to Senator Coordsen.


SENATOR CROSBY:  Senator Coordsen, there's about eight and a half minutes left.


SENATOR COORDSEN:  Thank you, Madam President, members of the body.  This compromise I think...  and I will certainly let Senator Beutler speak for himself after I turn the time back to Senator Bromm, but it, I think, addresses the concerns that people had with respect to the open-endedness, at least when viewed from some, on the affidavit to merge, consolidate or unify.  I am in agreement with the amendment.  It does certainly




change the complex of the bill, but I believe that the situation out there in many of these districts is severe enough, and the other alternative of levy override is an ominous enough presence, that I have agreed to this, and what it provides for is that if the...the system, the school system that is asking for the mitigation funds is not able or does not in good faith unify, consolidate or merge, then they have to :pay the money back.  And it provides that, if I can find, it, that the judgment will be made by the state reorganization committee as to whether a good faith effort had been made with adjoining schools.  And, with that, I would turn the time back to Senator Bromm if he would like to share it with Senator Beutler.


SENATOR CROSBY:  Senator Bromm.


SENATOR BROMM:  Yes, I would like to yield time to Senator Beutler and be...


SENATOR CROSBY:  There's about four and a half minutes, Senator Beutler.


SENATOR BROMM:  ...  before ...  before I do that, I'd like to make one other comment.  Sometimes in our...  in our haste to be efficient we fail to get people signed on amendments or give them due credit.  Senator Wickersham had a budding idea which helped generate this amendment and he should be on the amendment but it didn't get done.  I would yield the rest of my time to Senator Beutler.


SENATOR CROSBY:  Four minutes, Senator Beutler.


SENATOR BEUTLER:  Senator Crosby, I'm...  I'm grateful to Senator Bromm and Senator Wickersham and most of all to Senator Coordsen for the flexibility that has been shown and I hope what's being asked for is not too much.  It is, in fact, a compromise and, with that compromise, my amendments to this amendment will certainly disappear.  Thank you.


SENATOR CROSBY:  Thank you, Senator Beutler.  Senator Bromm, were you finished?  Thank you.  You've heard the opening.  Discussion on the Bromm amendment?  Senator Schimek.




SENATOR SCHIMEK:  Yes, thank you, Madam President, members of the body.  I rise for just a moment to talk about process and I'm sorry...or Senator Willhoft is in the room I guess.  I wanted to Senator Willhoft to know that the reason I couldn't vote for his amendment and I'm sure a lot of other people on this floor couldn't vote for his amendment is 'cause we didn't know what his amendment said.  And I, to this moment at least, don't have the Bromm amendment.  Now it might be up on the gadget by-now.  Is it?  But I think we have to be careful about how fast we move here.  Some of us have to have that in our hands before we can get up to speed on what's going on.  So, Senator Willhoft, it was nothing personal.  Had nothing to do with your amendment.  Just didn't know what it was and couldn't vote for it without seeing it.  So please...  I hope people will try to make sure that we get copies of their amendment before they actually come up on the floor, because it's hard to follow the explanation if you don't have the amendment in your hand.  Thank you.


SENATOR CROSBY:  Thank you, Senator Schimek.  Senator Landis on the Bromm amendment.  I couldn't ...  Senator Landis, did you waive off?




SENATOR CROSBY:  Thank you.  I couldn't see.  Senator Coordsen on the Bromm amendment.


SENATOR COORDSEN:  Thank you, Madam President, members of the body.  And I recognize what Senator Schimek was talking about and I did push my light because I'm sure this compromise amendment which upset the Clerk because we were running -late, but that's okay, we had a time line that was pretty difficult to get accomplished, so this has not been handed out.  But what I would like to ask you to do, and I'll try to read quickly enough to get this done in five minutes, that on page 2, line 3, on Amendment 3312, insert, "The temporary mitigation funds provided in this section (sic-subsection) shall be returned if the receiving district does not merge, consolidate or unify prior to June 30, 2000.  The temporary mitigation funds need not be returned if, prior to June 30, 2000, the receiving district is unable as determined by the state reorganization committee to




merge, consolidate or unify despite good faith efforts because all districts with which the receiving district could reasonably be expected to merge, consolidate or unify declined such merger, consolidation or unification." And then it strikes the punitive language for the boards that is contained at the bottom of page 1 and the top of page 2.  1 hope that is helpful in the time that it takes to get this on to the...on to the board.  I think it serves to address the concerns that Senator Bohlke had and I had a very difficult time in addressing and certainly as I indicated several times earlier today we had tried a number of different ...  or made a number of different attempts in language to address the problem that I believe is addressed in that, in that the...  if there isn't a good faith effort that is strong enough to be determined by the state reorganization committee then the school has to give this...or the system has to give the money back.  That would be about all I would say, other than I do support the amendment.  Thank you.


SENATOR CROSBY:  Thank you, Senator Coordsen.  Further discussion on the Bromm amendment?  Seeing none, Senator Bromm, would you like to close on your amendment?  He waives closing.  Question is the adoption of the Bromm amendment to the Coordsen amendment.  All in favor vote aye, opposed no.  We're voting on the Bromm amendment.  Have you all voted?  We're voting on the Bromm amendment.  Have you all voted?  Record, please.


CLERK:  27 ayes, 0 nays, Madam President, on adoption of Senator Bromm's amendment to the Coordsen amendment.


SENATOR CROSBY:  The amendment is adopted.  Mr. Clerk.


CLERK:  Senator Beutler, next amendment to Senator Coordsen's amendment.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  I would withdraw that.


SENATOR CROSBY:  No objections?  It is withdrawn.


CLERK:  Senator Beutler, next amendment, 43 ...  it's 4337.




SENATOR CROSBY:  Senator Beutler.




CLERK:  No, 4337.


SENATOR BEUTLER:  Is it an amendment...


CLERK:  It's an amendment to 4312.


SENATOR BEUTLER:  ...  to 4312?


CLERK:  Yes, sir.


SENATOR BEUTLER:  I withdraw that.


SENATOR CROSBY:  No objection?  It is withdrawn.


CLERK:  Senator Beutler, EA667 to 4312.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  I'd withdraw that.


SENATOR CROSBY:  It is withdrawn.


CLERK:  That's all that I had pending to Senator Coordsen's amendment, Madam President.


SENATOR CROSBY:  Further discussion on the Coordsen amendment?  Senator Schrock.


SENATOR SCHROCK:  Madam President, members of the Legislature, Senator Coordsen, would you be willing to answer a question or two?


SENATOR CROSBY:  Senator Coordsen, will you yield for a question?


SENATOR COORDSEN:  Certainly, Senator Schrock.


SENATOR SCHROCK:  First of all, I'd like to thank Senator Bromm




and Wickersham and Beutler and you, Senator.  Coordsen, for working out this compromise, which I hope passes, as I have some schools in my district that are facing some difficult situations, and it's not easy.  It's painful, but:  rather than pick on somebody in my district, I'll pick on somebody in Willhoft's ...  Senator Willhoft's district.  Let's suppose Sandy Creek said to Clay Center schools, we would like to unify with you, and therefore we'll get this money that's offered from this amendment, from your amendment.  And the Clay Center schools indicates after a period of time that they're not interested.  Does that mean Sandy Creek gets to keep the money and operating as usual?


SENATOR COORDSEN:  It would be my interpretation that after the state Reorganization Committee looked at it and decided that Sandy Creek had made a good faith attempt with whether it is Clay Center or another district...  it could be Davenport, it could be Lawrence, it could be some other district ...  that if Sandy Creek did everything that the state Board of Reorganization felt that they could do to effect unification, my response to your question would be yes, with that preface, that they would keep the money.


SENATOR SCHROCK:  Okay.  Thank you.  Well, I hope this clarifies...  this clarifies some things for me and I think there are some school districts in my legislative district that are feeling some pain that can use this.  Whether they will choose to do that or not, it's just another option.  And I understand we had the battle on 806 last year and why the reluctance is from some people to send more money out to rural areas.  But I think this is something that might work, and hopefully some school districts will take advantage of it.  I suspect your exposure to the reserve is not going to be as high as you once thought it might be.  And so I don't supposed there's any way of telling how much that might be, but with those comments, I will be quiet.  Thank you, Madam President.


SENATOR CROSBY:  Thank you, Senator Schrock.  Senator Landis, on the Coordsen amendment.






SENATOR CROSBY:  The question has been called.  Do I see five hands?  I do.  The question is, shall debate cease?  All in favor vote aye.  Opposed no.  We're voting on ceasing debate.  Have you all voted?  We're voting on ceasing debate.  Have you all voted?  We're voting on ceasing debate.  Have you all voted?  Record, please.


CLERK:  25 ayes, 1 nay to cease debate.


SENATOR CROSBY:  Debate ceases.  Senator Coordsen, you're recognized to close on your amendment.


SENATOR COORDSEN:  Madam President, while I'm closing, before I start I would like to ask for a call of the house, please.


SENATOR CROSBY:  There's a request for a call of the house.  All in favor vote aye.  Opposed no.  Record, please.


CLERK:  20 ayes, 0 nays to place the house under call.


SENATOR CROSBY:  The house is under call.  Would all senators please record your presence.  Would those ...  would all unexcused senators please return to the Chamber and record your presence.  Would all unauthorized personnel please leave the floor.  The house is under call.  Senator Coordsen, would you like to begin your closing?


SENATOR COORDSEN:  Yes, Madam President, with your permission.  I think we've went a long way toward providing a bridge between where we are now and the implementation date of 1219.  (LB) 1219 is a new system that I feel, really do strongly feel , would provide a new school system for the face of Nebraska that would answer many of the questions that have prevented consolidations and mergers in the past.  I think the inclusion of what once upon a time was (LB) 1247 into this process will hopefully prevent a number of levy override attempts, which quite frankly fly contrary to all of the efforts that we have made in this body over the past years to provide for a more efficient school system and school systems in the state of Nebraska that are funded more and more from sales and income tax across the -state rather than property tax.  It's been our goal for a long time and I believe the combination of these two bills, and I would




certainly hope that 1219, as it in written, will be advanced substantially as it is written, will be a great incentive to those schools who have had a significant loss in available funds for the forthcoming year.  This combination will do two things.  It will give schools who have lost lots of either property tax resources with the $1.10 levy or state aid resources because of other factors within that, a breathing room that, for individual schools, is not going to be much money, but it's going to certainly be enough, I would think, to help them get through with other funds that they might have to the following school year.  And by that time, I would hope that there would be a recognition that they need to restructure in ways that are different from what they might be.  It is a one-time measure.  It does not go to all of the schools.  It does not go to nonequalized schools.  It goes only to schools who have not increased their budgets by more than two percent unless that is dictated by population growth.  It calls for $4.5 million to be transferred from the cash reserve fund.  I rather suspect, with the requirements that we have in place and the number of schools that have already decided to go on their own through levy overrides, that when we hear at the end of this program what it actually costs, it will probably be less than that.  But it cannot be more than that, and it is to be shared between all of the schools in systems as the number of formula students are shared.  So I think we, with the assistance of Senator Beutler and others, have arrived at a workable program that will be of benefit on a very short time frame, one year, to help schools prepare for the future and to live within the constraints of the assistance that might be available to them under 806 and to live within the levy limits that are coming into being on the first of July as per 1114.  So I would move for the attachment of AM4312 to LB 1219.  Thank you, Madam President.


SENATOR CROSBY:  Thank you, Senator Coordsen.  You've heard the closing.  All people are here and accounted for.  You've heard the closing.  The question is the adoption of the Coordsen amendment to LB 1219.  All in favor vote aye; opposed no.  We're voting on the Coordsen amendment.  Have you all voted?  Senator Coordsen.


SENATOR COORDSEN:  Madam President, to move things along, I would ask for a roll call vote in regular order, please.




SENATOR CROSBY:  Thank you, Senator Coordsen.  A request for a roll call vote in regular order on the Coordsen amendment.  Mr. Clerk, please call the roll.


CLERK:  (Roll call vote taken.  See pages 1649-50 of the Legislative Journal.) 23 ayes, 12 nays on the amendment,


SENATOR CROSBY:  The amendment fails.  I'll raise the call.  Mr. Clerk.


CLERK:  Next amendment.  Senator Coordsen, this is the one, Senator, your earlier version.


SENATOR CROSBY:  Senator Coordsen.  Oh.  I'm sorry.  No objections?  It is withdrawn.


CLERK:  Senator Bohlke, AM4256.  (See page 1570 of the Legislative Journal.)


SENATOR CROSBY:  Senator Bohlke.


SENATOR BOHLKE:  Yes, Mr. Speaker and members, this is a bill that Senator Raikes and I introduced, and I had a chance to talk to Senator Dierks about it.  You remember last time that we had a bill ...  an attempt of an amendment to have the number of years at the end of the seven-year agreement to make a decision, but also a part of that was saying that if you entered into this, you had to stay in it for two years.  I talked to the superintendent from the schools that were...  they're going to first, I think, implement this, and talked to them about, really in some ways, that almost being a protection because if you go through the unification...  and it seems to me, I talked about how you need some time to let things settle down, the time where it might break apart the most could be in those first years as they're trying to work everything out.  Sometimes this is somewhat of a tenuous situation between communities who are trying to get together and trying to make this work.  It seems to me that there are those things that may happen that would be a benefit that they would at least have to stay together.  And I would say this amendment suggests three years.  That's the three years that they get their payments.  Senator Dierks, I think,




has his light on.  I'll let him speak to his reaction to this, but certainly the superintendent that I spoke with said that he wasn't opposed.  I think it maybe gives the unification a better guarantee that it has some time to work.  And so, I think that is what is before you in this amendment and I'll try to answer any questions you may have.  What it does is that it says that the interlocal agreement shall provide for a minimum term of three school years.  With that, I'll answer any questions.  Thank you.


SENATOR CROSBY:  Thank you.  Discussion on the Bohlke amendment?  Senator Dierks.


SENATOR DIERKS:  Thank you, Madam President and members of the body.  I have visited with Senator Bohlke about this with a couple of superintendents in my district.  It seems to be agreeable with everybody, so I'm going to support the amendment.  Thank you.


SENATOR CROSBY:  Thank you, Senator Dierks.  Further discussion on the Bohlke amendment?  Further discussion on the Bohlke amendment?  Seeing none.  Senator Bohlke, you may close.  She waives closing.  The question is the adoption of the Bohlke amendment.  All in favor vote aye; opposed no.  We're voting on the Bohlke amendment.  Have you all voted?  We're voting on the Bohlke amendment.  Have you all voted?  Record, please.


CLERK:  26 ayes, 0 nays, Mr. President...Madam President, excuse me, on Senator Bohlke's amendment.


SENATOR CROSBY:  The Bohlke amendment is adopted.


CLERK:  Senator Beutler, 4305.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  Mr. Clerk, members of the Legislature, I would ask consent to substitute 4346 for 4305.


SENATOR CROSBY:  No objections?  The substitution is made.


CLERK:  The number again, please, Senator?




SENATOR BEUTLER:  (AM)4346.  (See page 1650 of the Legislative Journal.)


CLERK:  Thank you.


SENATOR CROSBY:  Senator Beutler, to open on your amendment.


SENATOR BEUTLER:  Senator Crosby, members of the Legislature, this amendment is on page 8 of the bill, the section that allows ...  that describes the districts that can be unified.  I had included here language that required that the Class II or III that's being unified with another district be contiguous to that district and that the Class I's be contiguous to one or more of the Class II or Class III's that may be involved in the unification.  And I guess I would ask, Senator Bohlke, I hope I have not missed anything here, but I didn't find language requiring it to be contiguous, and I thought that that should be the case since we had such a problem with freeholders and that kind of thing because they were not contiguous.  Senator .Bohlke,...




SENATOR BEUTLER:  ...  let me just as you as a matter of fact, is there any place in the bill that I've missed that would require this to be ...  the unification to be contiguous properties, contiguous districts?


SENATOR BOHLKE:  No.  As usual, I think you have read it, very closely and realized that that's true.


SENATOR BEUTLER:  Okay.  If ...  well, I would leave that amendment out there, then.  If there is any objection, I would be interested.  Thank you.


SENATOR CROSBY:  Senator Beutler, are you finished?  Were you waiting?


SENATOR BEUTLER:  I'm sorry.  I am finished, yes.


SENATOR CROSBY:  Thank you.  Thank you, Senator Beutler.




Discussion on the Beutler amendment?  Senator Bohlke.


SENATOR BOHLKE:  Yes, Madam Speaker?


SENATOR CROSBY:  Your light was on.  I am asking you if you want to discuss the Beutler amendment.


SENATOR BOHLKE:  No, I'm sorry.  I'll waive off.


SENATOR CROSBY:  Thank you.  Senator Dierks, on the Beutler amendment.


SENATOR DIERKS:  Yes, I do, Madam President and members of the Legislature.  Senator Beutler.


SENATOR CROSBY:  Senator Beutler, will you yield?




SENATOR DIERKS:  Explain to me what you intend for this amendment to do.


SENATOR BEUTLER:  Senator, the amendment is intended so that whatever districts decide to get together, they would be contiguous.  They would touch in some part.  We had a lot of problems, and I'm not sure if there were any in your area, with situations where people ended up in districts that were not contiguous and they were spread out all over the place and little bits and pieces went to one district and another piece went to another district.  And in the sense of being compact and therefore efficient in a transportation sense, among other things, it just doesn't make any sense.  It just looks like a patchwork out there.  And so I was thinking that it would make sense to avoid that with the unification procedure if that was going to be used and simply require that the districts be contiguous as they normally would be.


SENATOR DIERKS:  Okay.  Well, I guess ...  I think that our affiliation law and our consolidation and merger law today prevents the checkerboarding which I think you're referring to.  I do know of a district ...  two school districts in my legislative district that merged, and they skipped across another district




to do it, and they're very happy with that.  And I think that if...  I think that maybe the district they skipped over is not very happy, but the two districts that did the merger are very happy.  And I'm wondering if we don't...


SENATOR CROSBY:  (Gavel.) Senators, please keep your conversations down so we may hear the speaker.


SENATOR DIERKS:  I'm wondering why we would want to quell the possibility for school districts who are entire, and maybe not contiguous, from merging.  I don't understand, really, I guess why that's bad.  I understand what you're saying about transportation, but if these...  if you have a district out there that has what they think is a better educational process going on and one that wants to merge with it has to hop across another one to do it, why would that be a problem for the Legislature?


SENATOR BEUTLER:  Senator, I think what we've discovered, historically, is that perhaps this is done not always for educational reasons, but for other reasons.  And further, that it's rarely been seen where the efficiency lost because of distances in transportation ever made sense in terms of the educational value.  I mean, there is a normal and natural inefficiency to having noncontiguous districts that is so substantive in nature that, at least historically, at least from what I've seen on the Education Committee, it makes no sense to encourage creative, so to speak, configurations that, in the end, really end up with a lot less economic sense than should be there.  I mean, you're referring to Napier (sic)-Spencer?


SENATOR DIERKS:  Naper-Spencer, yes.


SENATOR BEUTLER:  Naper-Spencer.


SENATOR DIERKS:  I also have another situation in my district along with this unified...


SENATOR CROSBY:  One minute.


SENATOR DIERKS:  ...  this unified system that we're talking about.  There are several schools who have expressed an interest in becoming part of that unified district.  One of those schools




would have to step across some other property to get there, and ...  well, I think they would.  I'm not sure, but it isn't a matter of taxes or anything like that.  It's just a matter of wanting some.  of the same guarantees that people in the unified district think they're going to have by belonging to a bigger system.  I think that the system that we're talking about in my district is going to be an excellent educational system.  The four schools that are doing this provide an excellent education today.  Orchard, for instance, has had ...  we were talking about the gifted thing.  Orchard has a youngster who.  competed nationally in the National Geographic Bee and won third place nationally last year without any particular gifted program in place.  That student was well-cared for...




SENATOR DIERKS:  ...  as a gifted student.  Thank you.


SENATOR CROSBY:  Your light is next, Senator Dierks.  Would you like to go ahead?


SENATOR DIERKS:  I suspected as much.  Thank you, Senator Crosby.  They had another student that placed, I think, third or fourth in the state spelling bee this year.  And they had another group of students who placed first in the...  some sort of organized contest nationwide.  This is without gifted education.  I think the educational process in these four districts that I'm talking about is very, very excellent.  They do an excellent job.  The quality of education is great, and if there's an attempt on the part of anybody out there to want to become a part of this unified district, I think that ought to be made available to them.  And I think they're not looking at ...  you know, the taxes ...  are a wreck all over the place out there.  There's not much of a way you can go to advantage yourself taxwise.  This would be letting them get into a bigger system, which I think is what we were talking about most of the time here.  I'm going to have some problems with the amendment, Senator Beutler, because I think that it could quell what I think is the possibility for schools to merge and provide a good education for their students.  Thank you.


SENATOR CROSBY:  Thank you, Senator Dierks.  Senator Willhoft.




SENATOR WILLHOFT:  I, too, rise to oppose Senator Beutler's amendment.  I know that Senator Beutler is trying to make this as good as he possibly can, but as the situation I mentioned before, Sandy Creek sits down there; the Meat Animal Research Center separates them.  If Clay Center does not choose to unify, merge, or do anything, it cuts Harvard off, it cuts Giltner off,' it cuts about anybody else off going with them that is not already merged.  Sandy Creek did this in 1975 or 176, the way we said.  I don't want to put any more roadblocks in their way.  I think $460,000 is a big enough roadblock.  Thank you, Madam Chairman.


SENATOR CROSBY:  Thank you, Senator Willhoft.  Further discussion of the Beutler amendment?  Seeing none, Senator Beutler, would you like to close on your amendment?


SENATOR BEUTLER:  Senator Crosby, members of the Legislature, the amendment, I think, is a very good one.  I don't know that there is any situation, one way or another, that can address everything, every situation that may come up such as the situation in ...  the one situation in Senator Dierks' office...  Senator Dierks' district, or perhaps the situation in Senator Willhoft's district.  All I can say to you is that over time in the Education Committee, looking at what's happened with the freeholder provisions, I think everybody on the Education Committee is agreed that there are far more problems that develop when you allow noncontiguous districts to engage each other in one way or another organizationally than are helped by leaving it wide open.  In other words, on the average, far and away the most efficient...  and not only the most efficient, but the wisest way is with contiguous districts.  And so, all I'm seeking to do is not to recreate the problems that we've had with the freeholder provisions, and we have changed those now.  And if we don't do this at the beginning now, I'm sure that at some point in time we will change it also.  So perhaps it's wise to gain from the ...  to learn from the experience that we've had and start out with the right kind of formations in the first instance.  So I would recommend this amendment to you which indicates that all unified districts would be contiguous.  Thank you.




SENATOR CROSBY:  Thank you, Senator Beutler.  You've heard the closing.  The question is the adoption of the Beutler amendment to LB 1219.  All in favor vote aye; opposed no.  We're voting on the Beutler amendment., Have you all voted?  We're voting on the Beutler amendment.  Have you all voted?  We're voting on the Beutler amendment.  Have you all voted?  Record, please.


CLERK:  6 ayes, 17 nays on the amendment.


SENATOR CROSBY:  The amendment fails.  Mr. Clerk.


CLERK:  Senator Beutler, 4302.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  Mr. Clerk, I'd withdraw that amendment.


SENATOR CROSBY:  It is withdrawn.


CLERK:  Senator Beutler, 4303.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  Mr. Clerk, I'd withdraw that amendment.


SENATOR CROSBY:  It is withdrawn.


CLERK:  Senator Beutler, 4301.


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  And I'd withdraw that amendment.


SENATOR CROSBY:  It is withdrawn.


CLERK:  Senator Bohlke, 4338.  (AM4338 is on file in the Clerk's office.)


SENATOR CROSBY:  Senator Bohlke.


SENATOR BOHLKE:  Yes, Madam President and members, you have before you a short bullet sheet and the amendment.  This is




mainly a clean-up amendment, technical amendment.  It touches on some areas that were identified that needed to be further refined.  The first one has to do with how teachers would be allocated in case of a riffing, if a riffing was necessary in the new unified district.  And so it's an extension of what is already in place, but just merely clarifies that all the participating districts would have to sign off on how they are allocated.  The next is language clean-up.  And the third recognizes some other parts of the bill that when we did the Senator Bromm-Wickersham amendment that we needed to do in order to harmonize it with other sections of the bill.  So with that, it's merely a very technical amendment and mostly clean-up language.  I would ask for your adoption.  Thank you.


SENATOR CROSBY:  Thank you, Senator Bohlke.  Discussion on the Bohlke amendment.  Senator Dierks.


SENATOR DIERKS:  Thank you, Madam President.  I've looked over the Bohlke technical amendment and I think that's what it is, and I'll support that.  Thank you.


SENATOR CROSBY:  Thank you, Senator Dierks.  Further discussion of the Bohlke amendment?  Seeing none.  Senator Bohlke, you can close.  She waives closing.  The question is the adoption of the Bohlke amendment to LB 1219.  All in favor vote aye; opposed no.  We're voting on the Bohlke amendment.  Have you all voted?  Record, please.


CLERK:  25 ayes, 0 nays on adoption of Senator Bohlke's amendment.


SENATOR CROSBY:  The amendment is adopted.  Mr. Clerk.


CLERK:  Senator Beutler, I understand you now want to offer 4303?  (AM4303 appears on pages 1650-51 of the Legislative Journal.)


SENATOR CROSBY:  Senator Beutler.


SENATOR BEUTLER:  Yes, Mr. Clerk, members of the Legislature, this is the last amendment on this bill, but I think a very important one.  And it goes back to the concept that we




discussed yesterday of whether a unified district is to be an engagement before marriage or whether it can be a continuous engagement.  And it's an attempt to compromise' that concept.  Basically, what it indicates is this:  that a unified district can go on for the first seven years, and during that period of time the, the first seven years, it would have a board that would be constituted, as is directed by the interlocal government...  interlocal agreement.  And that board could be constituted in any way that the unified districts-make up.  And I think it's fair to assume that whatever leverage one district may have in a particular situation they will assert to get as many board members as possible.  Therefore, a unified district, as long as it continues, probably in most cases will not be a particularly democratic district in the sense of one person, one vote.  These are not sovereign nations; these are school districts.  And in the end, once you get to the final configuration of a district, it ought to be governed by a board that's democratically elected, one person, one vote.  And so, what this amendment says is that...  is not that you can't go on being a unified district, but that at the end of seven years, the board of the unified district will be elected in the same manner as would a Class I or a Class II or a Class III board would be elected, and you would choose Class III or Class II in accordance with the formula that's already in the unified district provisions here, which basically indicate that if you have two Class II districts, your board would be ...  you would follow the Class II organization.  And if it were two III districts, you would follow the Class III organization and so forth.  So, the only modification it makes is to say, with respect to the unified district board, after a period of seven years has expired, if you choose to continue to be a unified district, your board would be elected in the same manner as a Class II or Class III school district board.  Thank you.


SENATOR CROSBY:  Thank you, Senator Beutler.  Discussion on the Beutler amendment?  Senator Landis.


SENATOR LANDIS:  Madam President, members of the Legislature, I'm going to guess that amendment is slipping by us in our focus on what has happened on the Dierks amendment, and people will probably want to read that amendment.  I'm going to take the...  I'm going to say off the top of my head, I think the




amendment sounds acceptable to me.  I actually want to talk about the Dierks amendment for a moment.  I have stayed out of the fight and the fray and ...  pardon me, the Coordsen amendment.  Thank you.  Those of us who have had an urban perspective over time have wanted to move towards equalization, and we wanted to reorganize the system that we do with state aid because we thought that the gradual transition away from foundation and to equalization was too slow, that it rewarded high value districts who were not in as precarious a position as many others.  And in the last paroxysm of pain, we did that last year in 806, the last...  I think you'd have to say the last of the major pieces of the move from foundation aid to equalization aid over the course of 20 years.  And the war has been won from that perspective.  The war of moving to equalization has been won.  It is unnecessary to bayonet the wounded as well.  It seems to me that in the course of a biennium in which we'll spend 175 new millions of dollars for state aid, 110 (million) in a06 and 50 or 60-some (million) in the natural growth of 1O59, that out of that amount of additional funds that we send through state aid that there should be some aid that we could do on a one-time basis for people that have to make a transition.  Yes, that transition has been a long time in coming.  Yes, they should have seen it coming.  Yes, they could have planned ahead and seen the writing on the wall and recognized it and fought 806 down to the wire and then got beat and then done something.  It's come and gone.  It takes time for people to realize the change that has occurred in state aid to education.  The Coordsen amendment, particularly with the amendment that was adopted by Senator Bromm and Beutler and Coordsen, is an olive branch, one that we could afford, one that allows for a transition between two ways of doing business.  And those who have been the recent victors, and those are essentially urban senators who have wanted to redesign state aid, for-whom the case I think was clear that they should have won, could be a little magnanimous in the exchange or transition.  Having won the war, it's unnecessary to bayonet the wounded.  I am disappointed that we couldn't extend the fig leaf of the Coordsen amendment, and I assume that we'll act on 1219 without coming back to this issue, and that's too bad.  I'll vote for the Beutler amendment.  I'll vote for the advancement of 1219.  This was a chance for us to build bridges between us and the differences in our districts, and it will go unmet,




unfortunately, but not because we're not trying to do the right, thing.  From all perspectives, it just seems to me that particularly in a moment of victory, and urban senators are in that moment now, that that's the time to show magnanimity.  Not when you're behind, but in fact when you're ahead.  And we are ahead.  (LB) 806 moved us ahead because it was good policy; sensible, long-deserved policy.  We could be magnanimous at this moment.  Thank you.


SENATOR CROSBY:  Thank you, Senator Landis.  Discussion on the Beutler amendment?  Senator Dierks.


SENATOR DIERKS:  Thank you, Madam President and members of the body.  I'm going to have to comment, I guess, first about the ...  Senator Landis' comments.  I think those were great.  I hope that it has some effect.  And at the same time, I'm going to have to oppose Senator Beutler's amendment.  We have...  I think that we have in place, in the amended version of LB 1219, everything that we need to make unification process work.  I've resisted many of the amendments that have been tried to put on the bill because I knew that I had a somewhat precarious situation in my district and that I didn't want to upset the apple cart and take the chance that something might turn to their disfavor and maybe decide not to do this.  I think it's a great opportunity for us, for my district, and for this state to do this unification process.  I think it offers an opportunity for a number of schools to save their school districts and their communities.  I think we have to be about that sort of thing.  This amendment of Senator Beutler's is a little bit heavy-handed.  I don't think that we really need this.  I think that the way they've set up their school board membership, it's done within the system, it's done by the unified system, and I think that we should allow that to take place just like we've talked about it before.  We talked about this on General File and we defeated the amendment at that time.  I hope we can do it again.  Thank you.


SENATOR CROSBY:  Thank you, Senator Dierks.  Senator Bohlke.  Senator Bohlke, on the Beutler amendment.  She waives off.  Senator Wickersham.


SENATOR WICKERSHAM:, Madam President, members of the body, I'm




going to rise to oppose Senator Beutler's amendment.  I think it's similar to a concept that we discussed earlier.  The addition here is that it dictates what the composition of the board would be after a ...  or how the board would be elected after a stated period of time..  I think, quite frankly, in all due respect to Senator Beutler and his desire to make sure that things turn out in a way that would be consistent with what he views our policy objectives to be, that I think that those folks who have reached the agreement to have a unified district and to operate under that kind of a system ...  and admittedly this is kind of an experimental system, I think we ought to allow that experimentation to extend at the local level and let those boards, by contract, by the unification agreement, decide how that board is going to be composed aside from the fundamental that's Already in the bill that we couldn't get past that bedrock consideration that you ought to have at least one member from each district on the board.  If I misunderstood Senator Beutler's amendment, I apologize to him, but I do think that because this is ...  and in some respects kind of an experiment, that we, at this moment, need to allow as much flexibility at the boards at the district levels to carry out our experiment for us.  They should be allowed to experiment almost as we're experimenting.  Thank you.


SENATOR CROSBY:  Thank you, Senator Wickersham.  Further discussion on the Beutler amendment?  Seeing none.  Senator Beutler, to close.


SENATOR BEUTLER:  Senator Crosby, members of the Legislature, this amendment was an attempt to compromise in terms of the question of whether a unified district ought to be able to continue into the indefinite future or whether it was a transitional kind of organization.  The amendment leaves in place the concept that it can continue indefinitely, but it just says that after the first seven years, after the first seven years when you choose your board you would choose it like you would ordinarily choose a board, like all other Class II and Class III's choose their boards and not continue in a hybrid, homogenized, undemocratic, potentially very undemocratic form of board.  There are going to be situations out there where valuation is highly prized, and deals are going to be made where the representation on boards is not equal or not related to the




number of people involved or the number of students involved.  And that leverage is going to exist, and it's not necessarily a beneficial leverage from the point of view of all of the children.  It is a leverage that can be asserted on behalf of a small portion of a potential district.  And while it seems to me that this body may want to allow that in the short term, in the long term, if you're going to continue this form of organization beyond seven years, this amendment just says, choose your board like all the other districts choose their boards at that point in time.  Thank you.


SENATOR CROSBY:  Thank you, Senator Beutler.  You've heard the closing.  The question is the adoption of the Beutler amendment to LB 1219.  All in favor vote aye; opposed no.  We're voting on the Beutler amendment.  Have you all voted?  Record, please.  A record vote has been requested.


CLERK:  (Read record vote.  See page 1651 of the Legislative Journal.) 6 ayes, 10 nays on the amendment.


SENATOR CROSBY:  The amendment fails.  Mr. Clerk.


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


SENATOR CROSBY:  Thank you, Mr. Clerk.  We are on the bill.  Any discussion on the bill?  Senator Wickersham, on the bill.


SENATOR WICKERSHAM:  Thank you, Madam President.  I think that we have had a rather extended discussion on this bill.  I was, of course, disappointed on the vote that was taken on Senator Coordsen's amendment.  I thought that was an appropriate addition to this bill.  But in general, even without the addition of Senator Coordsen's amendment, and I still would hope that that could be added at some stage of our consideration of this bill, I think that the experiment or the opportunity, however you want to phrase it, that this bill will afford to school districts is a good one.  It's an opportunity that I think we can afford them as they, perhaps, try to change the ways in which they operate to become more efficient, and at the same time retain the identity that they've always found so critical for their communities and for their schools.  I don't




think, quite frankly, that we will serve the interests of this state if we cause them to lose that identity and that sense of community.  That cohesiveness has served them and I think us very well.  In many cases, the school is the central component of the life of the community, both economic and social.  To ask people to give up that kind of an important piece of their life, I think, is more than we should ask of them most cases.  Unification allows them to maintain that identity, to maintain their school, to maintain their sense of community, but at the same time recognize efficiencies through changes in their operations.  And from that standpoint, I think it is a good bill and hope that it will receive enough support to advance today.  And again, I would express my hope that if it advances that somehow we would still do that with the Coordsen amendment attached, because the Coordsen amendment gives schools an opportunity to make the kinds of changes that are being called upon ...  that they're being called upon to make as a result of 806 and the levy limitations of 1114.  So I hope that if there is further debate that it is favorable to this bill and that we adopt it.


SENATOR CROSBY:  Thank you, Senator Wickersham.  Mr. Clerk.


CLERK:  Priority motion, Madam President.  Senator Wesely would move to reconsider the vote on the Coordsen amendment as amended, specifically AM4312 to the LB 1219. 


SENATOR CROSBY:  Senator Wesely, to open on your reconsideration motion.


SENATOR WESELY:  Thank you, madam.  I filed this.  I voted against the amendment and it did fail.  My friends from rural Nebraska are concerned.  This is very important to them, and I felt like if they were that close and felt they wanted another chance to take another quick shot at it, I would allow that to happen.  Let me tell you, also, another thought I had is I just got interviewed on the issue and it was discussed that Lincoln and Omaha senators were against this and, you know, what was happening here.  And I think this is no conspiracy; this is no attempt of urban against rural on this matter.  There's different opinions and views on this.  There's no effort to build anything here.  We do care about rural Nebraska.  We're




not insensitive to rural Nebraska.  We have a difference of opinion on this particular proposal, but that doesn't mean we don't want to give you a fair chance at the issue, and so I thought it'd be best to file the motion and that's what's before Us.


SENATOR CROSBY:  Thank you.  You've heard the opening.  Discussion on the reconsideration motion.  Senator Bromm.


SENATOR BROMM:  Thank you, Madam President, and I want to thank Senator Wesely for giving us the opportunity.  I really appreciate that.  I think the way the discussion went on the Coordsen amendment, it appeared that we had made a compromise which was a genuine compromise on both parts.  Senator Beutler gave some on his position, Senator Coordsen gave on his position, and it seemed to be a reasonable approach.  And I think of all the things that we were going to do this year with us having the good fortune of having a little extra money come into our coffers, this was one thing that many of us felt that we would be able to do even before a lot of other things.  We can never totally solve the school finance problem.  It will be an ongoing challenge, but I think to do a small measure of good faith for one year for those districts or for not even all of them, but for a portion of those districts that were so severally damaged would be really helpful in trying to look at the entire education picture for Nebraska.  And I can't really add very much to what Senator Landis said.  Senator Landis I think stated it clearly.  This is not, I don't think, one of those policy questions that we're going to have forever and ever.  We're not changing the school finance formula.  We're not appropriating an ongoing appropriation.  It is simply a one-time dip into the reserves of the state, if you will, for.  education, in these areas where they were particularly hard hit.  It has been mentioned to me ...  and I also would want to mention that I was there last year on 806 and I was there when we were done with it and I was there when the Governor said, this is something that we want to fix.  We should not do this in this severe manner to these schools without a little warning and a little transition.  And he made a promise to come back and help fix it this year and he has fulfilled that promise with his support of Senator Coordsen's approach.  Now, there are strings attached to Senator Coordsen's approach that we would rather not




have, but we're willing to accept those.  Those are there, and so those of you that do believe that consolidation, merger, or unification is progress as far as the school efficiency situation in rural Nebraska can take some credit for the measures that are in the bill that require the districts 'that get any money to honestly and deeply look at the possibility of merger, consolidation, or unification.  I don't think you would have to be apologetic whatsoever to your constituents for taking that step.  So I ...  if you can find it in your state senator realm of responsibilities and generosity for all of Nebraska, I would ask you to consider giving your vote to reconsider the Coordsen amendment.  I know that it would be greatly appreciated by many schools.  There will still be some who will not be helped, and we feel badly, but that just is the way it has to be.


SENATOR CROSBY:  One minute.


SENATOR BROMM:  And so I would ask for your vote for reconsideration.  Thank you, Senator Wesely, for giving us the opportunity to do this.


SENATOR CROSBY:  Thank you, Senator Bromm.  On the reconsideration, Senator Chambers, followed by Vrtiska, Cudaback, and Bohlke.


SENATOR CHAMBERS:  Madam President., members of the Legislature, there has not been such a saintly person with the name of Wesely since John.  I would like to ask "Saint Wesely" a question, if I may.  Saint Wesely, are you going to vote for this reconsideration motion, then for the amendment?  I'm just curious.


SENATOR WESELY:  I'll vote...


SENATOR CROSBY:  Senator Wesely.


SENATOR WESELY:  Thank you.  I'll vote for the reconsideration, but I'm not planning on voting for the amendment.


SENATOR CHAMBERS:  Thank you, Senator Wesely.  You all don't know anything about cats and "meeces", but cats understand




"meeces".  "Meeces" always run along the wall, even if the "meeces'" hole is on the other side of the room, the "meece" will never run across the room.  So the cat has studied "meeces" because cats eat them.  So the cat will run across the room and meet the "meece" as it runs around the wall and then catch the "meece" But a cat has a peculiar way about itself.  I like cats, not for this reason, but for other reasons, its independence; it's never completely domesticated.  But it will not just take that little "meece" and gobble it up.  It'll kind of...  like a ping-pong ball, toss it from the right paw to the left paw, then to the right paw, then act as if it's not paying attention, and when the "meece" runs away, reaches out with that paw quick as a cat, so to speak, and catches it by its little tail, pulls it back, and goes through that again.  That's called playing cat and mouse.  So I think the rural "meeces" are dealing with a city "meece", but I believe that you all should pay homage.  Contrary to what Saint Wesely said, there is a rural/urban split in this state.  The World-Herald thinks that it can use child psychology, which doesn't even work on children, and say there is no such.  I mentioned this to some of my colleagues and I mentioned it to one of them just today that until the problem is acknowledged, it cannot be addressed because you don't address that which is nonexistent.  As Baron Tyson knows, in logic you cannot prove a negative.  You cannot prove a negative.  So, if you say there is no rural/urban split, there's nothing to address.  But if it is acknowledged, the two warring sides can frankly draw out the boundaries of contention and determine what might be done to lessen the problem.  But if there is no problem, there's no need to try to bring the sides together because there are no sides.  The rural people, when 806 was before us, could have done something on that bill, and I wasted a lot of time talking to various ones of you ...  and you know who you are ...  not like Santa Claus will I whistle, shout, and call you by name.  But I laid out strategy with you, how you could have stopped that bill altogether, but you didn't have what it took to do that, so now you're pitching and patching, a little here, a little there.  I don't know the difference between the straight and the biased, but they're not the same.  So whether you all are on the straight or the bias, you come up losers because you are losers.  That's what you are.  And when you have to come begging with hat in hand all the time, you will always be a loser.  You may as well put a big "L" on your chest




and another one on your back and acknowledge that you're a loser and ask people to have pity and mercy on you once in a while because you're not going to stand up and fight.  If one of me....


SENATOR CROSBY:  One minute.


SENATOR CHAMBERS:  ...  with the determination that I have, can push for the things that I believe in, if there were just five of you who would make a hard-core group, only five, and if you didn't know what to do I would show you what to do.  You give me five senators and I will own this Legislature.  Give me five.  Five people could have kept Sodom and Gomorrah from going up in smoke, but there were not five then, there are not five here.  I'm going to watch this morality play out, and I'm going to see if the rural beggars and losers are going to learn anything from the past, or if they will convert that Jell-O in their spine into at least, at least, spaghetti.


SENATOR CROSBY:  Thank you, Senator Chambers.  Senator Vrtiska, on the reconsideration motion.  He waives off.  Senator Cudaback.


SENATOR CUDABACK:  Madam President, members, what's the first thing that happens after a tornado or after a hurricane or whatever goes through a city?  The first thing you do is ask for aid.  The first thing you do is want help.  And to some of these rural schools in some of these districts, that's what went through.  A hurricane or a tornado went through.  It really did.  It raised Cain.  So the least we can do is get them off their feet ...  up on their feet, get them going again.  One shot.  What's wrong with a one-shot deal?  We help out cities; we help out towns; we help out groups with these one-shot deals.  Get them on their feet.  What's going to happen?  It's inevitable.  We all know what's going to happen down the road, five, ten years.  Let's get them back on their feet here.  Let them reorganize.  Let them get their thoughts together.  I'll tell you what:  they're going to come to the right conclusion.  it's happened in my district twice this year.  They get their boards together; they get their thoughts gathered; they pick themselves up and they start all over again and let's give them one more shot here.  And I do thank Senator Wesely for giving this and 1




did enjoy the cat and mouse thing of Senator Chambers, but that's the way it goes, Senator Chambers.  So, please help us out here.


SENATOR CROSBY:  Thank you, Senator Cudaback.  Senator Bohlke.  Senator Bohlke, on the reconsideration.


SENATOR BOHLKE:  Madam President and members, I've heard some comments that I would just ...  as far as the reconsideration and certainly on LB 806, 1 think Senator Coordsen has made it quite clear and I've tried to make it clear that we worked together, and really we were looking at the ramifications, I believe, from 1114.  Earlier I had Senator Raikes ask me why the schools here would have been impacted by 806, and I think I ...  I tried to point out, and I think it was factual, that it was really because of a loss of students and increase in valuation, or a correction in payment, and that there may be other reasons you didn't like 806, but if you do remember, we did do the small school factor in 806, and those schools who met the guidelines of low spending actually did come in and qualify.  The other thing that I had wanted to say was that I misspoke earlier when I said on the conflict that...  I meant to say I would not be able to vote on the amendment, and I think I said on the bill.  I have full intention of voting for the bill.  It's simply the amendment, and I wanted to clarify that on the mike.  But certainly, I also think we need to clarify some of the statements that were made as to why these schools would appear on the list.  And then one last thing, that I keep...  I just had people come up and say to me, well, but I have a school on this list that's going to get helped, and that makes me so nervous ...  Senator Coordsen and I.  And I said I was going to say it one more time:  this list isn't even as close as a printout would be because there's no guarantee you would ...  you may be on the back of the list showing that you don't qualify, and all of the sudden you may move to the front of the list and qualify, or you may be on that list that shows you to qualify and you may move to the back.  Please, vote for this or not because you believe what should happen on the bill, not on that list.  And I know, I can just see the list in the newsprint tomorrow and the phone calls we're going to get.  And that's somewhat unfortunate, but you know, Senator Coordsen was asked for the information.  It goes back to the fact we all want to




see the list; we all want to see how our schools are going to do in our district.  But I wanted to tell you because this is on adjusted valuation and because this is on districts, not system, do not go to the heard me say it and I said it on the printouts before in 806 and I'll say it one more time, do not look down that list and make your decision because you think it's a school in your district.  Make the decision on the bill whether you think it is something that the Legislature should do or not do, not based on that list, or else I think in' the end, no matter which way you vote on it, you may be happy or unhappy.  And so, again, I certainly wanted to clarify that and chose to do it at this time because some people have spoken on the reconsideration on 806 and what it did to the schools.  Most Of these schools that you see on this list that were impacted by those reasons I mentioned, but most certainly by 1114, which I always think is interesting on how many of us voted for 1114 and 299 and are very forgetful sometimes of what...  that was a difficult decision for many people.


SENATOR CROSBY:  One minute.


SENATOR BOHLKE:  Some on the floor didn't vote for it because they realized the ramifications it would have for schools.  Others did.  There were severe ramifications.  When there were fewer dollars we had 806.  These schools have not met the 90 percent guideline that...  I think that this intention was to bring them up to 90 percent with ...  this is a good indication of the schools that we believe would not...that would be helped by this amendment, but certainly not a guarantee.  Thank you.


SENATOR CROSBY:  Thank you, Senator Bohlke.  Senator Coordsen.


SENATOR COORDSEN:  Thank you, Madam Speaker, members of the body.  I think that Senator Bohlke very adequately addressed our responsibilities here.  I think that is important or I wouldn't be here half of the afternoon and most of the morning promoting something that is not generally recognized as being an area of interest for me with respect to introducing legislation and carrying it through.  I simply believe so strongly that the organizational structure provided in the unification system has potential to allow the schools in outstate Nebraska, the schools that are generally 1000 or less in student population, to create




systems for themselves that meet their local needs and their local structure and the local demands of the citizens.  I think with unification we're going to increase the educational opportunities in much of Nebraska.  The question becomes, how do we get from here to there?  And I do not believe that we will ever get to unification unless we provide the funding to bridge the next year so that schools can do the talks, that they can do all of the negotiation that would be required under 1219 and that they will avoid having a levy override vote, which would quite probably remove them from any interest in-any sort of consolidation, at least for the years that their levy override was part of.  It doesn't affect state aid.  This bill does not affect state aid.  It does not in any way affect any other school in Nebraska.  It does not reduce, in any way, the certified aid that will be certified on December 1, 1998, for the following year.  It does nothing harmful to any other school in Nebraska.  It is a one-time, one-shot appropriation to schools who are going to have less than 90 percent of this year's resources available to them next year.  The money comes out of the Cash Reserve Fund.  Yes, I know that is also taxpayer money, but in doing it in that way, it is not in competition with any of the General Fund measures that many people here hold dear to their hearts.  So I'd hope that you would help us in reconsideration, and then help us in the adoption of AM4312 to 1219.  Thank you, Madam President.


SENATOR CROSBY:  Thank you, Senator Coordsen.  Senator Chambers.


SENATOR CHAMBERS:  Madam President and members of the Legislature, and to my rural colleagues, I'm not going to let you go.  If you don't stay together today, you're going to be my target for the rest of the session, and I won't call you by names individually.  I'll just say the "ruralies".  You have the opportunity today to stick together.  Let me ask Senator Coordsen a question before I proceed because I may be missing the boat on this.  Senator Coordsen,...


SENATOR CROSBY:  Senator Coordsen, will you yield?




SENATOR CHAMBERS:  Would your....  (laughing).




SENATOR COORDSEN:  Had to clear my throat there, Senator Chambers.


SENATOR CHAMBERS:  I thought that was a tiger.  Senator Coordsen, would your amendment help the small rural schools among others?


SENATOR COORDSEN:  Senator Chambers, all of the schools that are below 90 percent are, I suspect, by your definition, small rural schools in that they are at an enrollment of 1000 or less, although they have land masses in excess of 500 square miles.  Not all of them, certainly, but a number within that.


SENATOR CHAMBERS:  Well, if there was some way to work those miles into the aid formula, then there would be more equitability ...  more equitableness, perhaps, in the money that would go to those areas.  Correct?


SENATOR COORDSEN:  We did look at that, but we did not have the land mass of the individual districts available to us early enough to work that into a formula to address the problem.


SENATOR CHAMBERS:  Thank you.  I just want to be sure that this is a rural/urban issue, and it is.  It is.  It is.  Baron Tyson Just mentioned that I repeat my speeches.  He heard a very similar one from me when LB 806 was before us, and he correctly pointed out that nobody paid attention, and that's true.  It had no impact.  None whatsoever.  Bumpkins need not be pumpkins.  I want my rural colleagues to stand up and show your urban cousins a thing or two, which you won't do because it's not in you.  if I was a member of the rural group and some city slicker stood on the floor and talked about me and to me like this, I'd show him a thing or two with my vote.  And I wouldn't want to be coming back every single year saying, please help me.  The senator who spoke a couple of times ago, almost right after I sat down, thanked Senator "Saint" Wesely and then said, if you all will please help us.  Please.  You can help yourself.  There don't need to be any miracles.  When a human being was created, a human being was given a mental toolbox that contained every tool needed to deal with any problem you would confront, but you have to use it.  Use your brain.  The brain is not in your head to




keep it from collapsing so your hat won't fit it.  Your skull is there to protect the brain because it's important, and you ought to use it.  And you all should use it.  You don't have to be begging around here like you do and whining and crying and pleading.  Stand up.  That's one of the things that will distinguish you from the socalled lower orders.  You are bipedal.  You walk upright.  You were intended to walk upright, not with a hunch in your shoulders, not looking down at the ground.  Be men.  That sounds chauvinistic, but in the rural areas the men run everything.  They rule everything.  So let us see them take the bull by the horns now.


SENATOR CROSBY:  One minute.


SENATOR CHAMBERS:  I want to see the senator from Table Rock catch that Brahman and flip him.  Then I want to see Senator Cudaback jump on top of him with both feet.  Then I want to see the others with their various implements skin him, gut him, and prepare a tasty meal to celebrate the victory that they're going to have, thanks to Senator Wesely opening the door here.  I'm going to be proud of my rural colleagues this afternoon.  I'm not going to vote with you.  I'm not going to help you.  You got to stand up and fight this one for yourselves, and if you don't, you don't deserve anything.  And you won't get anything either.  I know the city folk.  We're going to see what happens.  I'm enjoying this, though, by the way.


SENATOR CROSBY:  Thank you, Senator Chambers.  Senator Wickersham.  Senator Wickersham, on the reconsideration motion.




SENATOR CROSBY:  That won't be necessary, Senator Wickersham.  There are no further lights.  Senator Wesely, you're recognized to close on your motion.


SENATOR WESELY:  Thank you, again.  This came at the request of my rural colleagues, and although I have concerns about the amendment, I think if they want another shot at it, in fairness, we should give it to them.  I ...  that's the motion to reconsider.  Thank you.




SENATOR CROSBY:  You've heard the closing.  Senator Coordsen.


SENATOR COORDSEN:  I would like to ask for a call of the house followed by a roll call vote in regular order.


SENATOR CROSBY:  There's a request for a call of the house.  All in favor vote aye; opposed no.  Record, please.


CLERK:  18 ayes, 0 nays to place the house under call.


SENATOR CROSBY:  The house is under call.  Would all senators please check in.  Would those unexcused senators please return to the Chamber and record your presence.  Would all unauthorized personnel please leave the floor.  Senator Brown, Senator Bruning, the house is under call.  Senator Don Pederson.  Senator Raikes, the house is under call.  Senator Engel.  Senator Thompson and Senator Tyson, the house is under call.  Senator Kiel, Senator Will.  Senator Tyson and Senator Kiel, the house is under call.  Senator Tyson, the house is under call.  Senator Wesely, they are unable to find Senator Tyson.  Should we go ahead with the roll call?  The question is the reconsideration motion of the Coordsen amendment.  Senator Coordsen has requested a roll call vote in regular order.  Mr. Clerk, please call the roll.


CLERK:  (Roll call vote taken.  See pages 1651-52 of the Legislative Journal.) 31 ayes, 7 nays to reconsider.


SENATOR CROSBY:  The motion is reconsidered.  Any discussion on the amendment ...  the Coordsen amendment?  Leaving the call.  The house is still under call.  I'm leaving the call.  Discussion on the Coordsen amendment?  Senator Coordsen.


SENATOR COORDSEN:  Only I think we've discussed it pretty thoroughly the last few hours.  I want to thank those who helped to give us another shot and would hope that they would see fit to vote for the bill and it would become part of 1219.  Thank you, Madam President.


SENATOR CROSBY:  Thank you, Senator Coordsen.  Senator Landis.


SENATOR LANDIS:  I just want to say that I'm voting for this in




recognition this is one-time money for the purpose of giving fair notice that the rules have changed and that we're going to have to learn to live with those new rules.  And I don't expect to see a dribbling in of this over time.  This, to me, is one-time money and it's why I can support it.  And I just wanted to make sure...  I didn't want the notice factor to not occur.  I think notice should be given that in my estimation this is meant to be one-time money to ease the transition.


SENATOR CROSBY:  Thank you, Senator Landis.  Senator Chambers.


SENATOR CHAMBERS:  Madam President, members of the Legislature, to my rural colleagues, we got the P-R-O.  Now we need the U-D to make it "proud".  If those will stick who voted for the first step, you'll have it.  And as that old song says, each victory will help you some other to win.  It's easy, and you all can do it.  And you will find that when you stand up and you give what you have got, then you'll find others who may have been unsure exactly which way they were going to fall, falling your direction.  It's difficult when you watch somebody struggling for something they really need and that they really believe in not to lend some assistance, especially if when you lend the assistance it's not going to harm you in any way.  Now, young Senator Bruning told you all I'm like the Grinch.  I'm like Darth Vader, but maybe even within the Grinch, though it may be the size of a walnut, there may be something that ticks that can approximate a heart.  Maybe in Darth Vader's monstrous chest, somewhere in there is some kind of engine that drives that machine and maybe he could even be swayed to your side.  So I'm going to see what happens.  And you all know now that you can make this happen, and you ought to.  And if you just get in a bind and you need just one little nudge to get over the hump or around the corner, you might be surprised where it will come from.  Don't look at me.  That wouldn't be a surprise.


SENATOR CROSBY:  Senator Abboud.


SENATOR ABBOUD:  Yes, Mr. (sic) President, would Senator Jensen yield to a question?


SENATOR CROSBY:  Senator Jensen, will you yield?






SENATOR ABBOUD:  Senator Jensen, I'm trying to get a handle on our district and how our district stands on this issue.  Have you been contacted by a lobbyist on this issue?


SENATOR JENSEN:  Oh, certainly I've been contacted by lobbyists on this issue from the start ...  from right from the start.


SENATOR ABBOUD:  And how have they stood on this issue?  Are they in support?  Is Westside School District in support of this amendment?


SENATOR JENSEN:  I would say....


SENATOR ABBOUD:  Just for the record.  I'm trying to establish here....


SENATOR JENSEN:  Westside School District, as you can recall in one of the handouts, had a ...  was quoted on there.  I don't know whether that quote is right or not.  The fact is I think it is not.  Westside certainly...  I can't speak for them directly, but I think that they feel that the rural community certainly deserves an opportunity to some adjustment.  What that is, I don't know.


SENATOR ABBOUD:  So you're supporting the amendment because you feel that they're in support of the amendment?


SENATOR JENSEN:  I, at this point in time, because of my rural colleagues and because of what has happened in some of these schools, I will support this amendment.


SENATOR ABBOUD:  Senator Brown, would you yield to a question?


SENATOR CROSBY:  Senator Brown, will you yield?


SENATOR ABBOUD:  Senator Brown, have you been contacted by Westside schools in regard to this amendment?






SENATOR ABBOUD:  And how do they stand on it?  Are they in support of the amendment or in opposition?


SENATOR BROWN:  They're not in support of the amendment because of what has happened to their school district over the last three years; a loss of 12 percent of their state aid, about $4 million.  But they also understand that there are needs in other parts of the state and that's maybe part of the reason that they keep losing millions of dollars is because they understand that kids' education across the state is important.  So I think that they are reserving some judgment on it.


SENATOR ABBOUD:  Does that mean yes or no?






SENATOR BROWN:  ...  they're not doing handstands.


SENATOR ABBOUD:  So that means you're going to be supporting the amendment, then?


SENATOR BROWN:  I was not voting on the previous vote.


SENATOR ABBOUD:  Okay.  So you're not going to vote on the amendment?


SENATOR BROWN:  Most likely.


SENATOR ABBOUD:  Okay.  Okay.  Thank you.


SENATOR CROSBY:  Thank you, Senator Abboud.  There are no further lights.  Senator Coordsen, did you have anything to say in closing?  He waives closing.  The question is the adoption of the Coordsen amendment to LB 1219.  All in favor vote aye; opposed no.  Record, please.


CLERK:  26 ayes, 6 nays, Madam President, on the adoption of Senator Coordsen's amendment.


SENATOR CROSBY:  The amendment is adopted.  I will raise the




call.  Mr. Clerk, any items for the record?


CLERK:  No, Madam President, I'm okay in that regard.  I have nothing further on the bill at this time, Madam President.


SENATOR CROSBY:  There's nothing further on LB 1219.  Any further discussion on 1219?  Seeing none, Senator Bohlke...Senator Bruning, I'm sorry.


SENATOR BRUNING:  (Microphone not immediately activated) ...  I move LB 1219 to E & R for engrossing.


SENATOR CROSBY:  You've heard the motion to move LB 1219 to E & R for engrossing.  All in favor say aye.  Opposed no.  it is advanced.






CLERK:  Mr. President, 1219A.  No E & R.  Senator Coordsen, I have an amendment from you, Senator.


SPEAKER KRISTENSEN:  Senator Coordsen, you're recognized to open on your amendment on 1219A.  (AM4272 appears on page 1576 of the Legislative Journal.)


SENATOR COORDSEN:  Yes.  Excuse me.  This amendment lowers the amount, if I can find it underneath all of the others.  This is 4272, Mr. Clerk?  And I believe that's accurate.  That adds the $4,500,000...


CLERK:  Yes, sir.  Right.


SENATOR COORDSEN:  ...  that was to fund (LB) 1247 into the ...  to the $10,000 that was to be used for (LB) 1219.  So I would urge the adoption of this amendment.


SPEAKER KRISTENSEN:  Debate on the amendment?  Senator Coordsen, you're recognized to close on your amendment.  He waives closing.  The question before the body is the adoption of the Coordsen amendment to LB 1219A.  All those in favor vote aye;