Senator proposes intercepting gambling winnings to repay certain unemployment overpayments

Senator Von Gillern introduced AM12-07 on LB415 to add clarity to a provision carried into LB415 from LB402 that permits the Department of Labor to collect unemployment insurance overpayments by intercepting gambling winnings in certain cases.

Von Gillern told the Legislature the amendment “pulls in and amends relevant sections of statute to outline how the Department of Labor should collaborate with the Department of Revenue and Racing and Gaming Commission in order to fully integrate Department of Labor collections procedures.” He emphasized the amendment is limited to overpayments that are the result of willful misrepresentation or fraud, saying that “those who, through no fault of their own, receive an excess of benefits accidentally or through no fault of their own will not be affected.”

The floor explanation said the amendment gives priority to Department of Health and Human Services collections for child-support offsets and is intended to provide administrative clarity about interagency procedures, including how gaming institutions report and how the Department of Revenue would process intercepts. Senators did not complete a recorded vote on AM12-07 during the morning sequence; the proposal was introduced and discussed and will require additional floor action to be adopted.

Why it matters: the amendment affects collections procedures for state agencies and links benefits-administration enforcement to the state’s gaming and revenue systems. Proponents said the change protects the integrity of unemployment insurance and ensures individuals who knowingly defrauded the program repay benefits; critics could raise due-process and implementation concerns if the policy is applied too broadly. Senator Dungan later spoke in favor of AM12-07 as a cleanup measure; no final vote was recorded in the morning session.