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Public Service Commission warns cuts to regulatory funds would impede broadband, 9‑1‑1 and gas rate proceedings
Summary
The Public Service Commission told the Appropriations Committee that proposed transfers and permanent sweeps of cash‑fund interest would impede long‑running broadband grant closeouts, public safety 9‑1‑1 operations and expensive natural‑gas rate cases; industry and the public advocate urged the committee not to sweep dedicated funds.
Deputy Director Suzanne Hinsman told the Appropriations Committee the Public Service Commission needs carryover and limited administrative funding to complete obligations under the Nebraska Broadband Bridge Program and opposed several proposed fund transfers in the Legislature’s budget bills.
Hinsman said the commission has run four cycles of Broadband Bridge grants since 2021 and awarded projects that will not finish until mid‑2026 or later. She asked the committee to preserve administrative Payroll/Salary/Lease (PSL) authority for at least six months into fiscal year 2027 to close out grants and review carrier reimbursement requests, and warned that removing out‑year PSL would make it difficult to process extensions or final payments.
Hinsman also objected to a proposed transfer of $250,000 — described in testimony as roughly one‑third of the Natural Gas Regulation Fund’s balance — into the general fund, saying the money is paid entirely by customers of two regulated utilities (Black Hills Energy and Northwestern Energy) and is dedicated to the cost of regulating those utilities, including funding the public advocate. She said an imminent full rate‑making case for Black Hills Energy will be expensive and that drawing down the fund now would force an immediate reassessment on those customers.
The commission further raised legal concerns about LB 264’s proposed permanent sweep of interest from the Nebraska Universal Service Fund (NUSF). Hinsman told the committee that the Nebraska Supreme Court’s 2006 Schumacher v. Johans decision weighed the constitutionality of temporary sweeps; the commission warned that a permanent sweep could alter the fund’s primary purpose and raise legal issues. Hinsman also voiced concern about a similar permanent sweep of State 9‑1‑1 interest, citing federal restrictions on diversion of 9‑1‑1 fees.
Industry and stakeholder witnesses amplified the commission’s arguments. Jill Becker, a registered lobbyist for Black Hills Energy, told the committee that the Natural Gas Regulation Fund’s balance is drawn down quickly in years with large regulatory proceedings and urged lawmakers not to sweep funds paid by a specific customer class into the general fund. Chris Dibbern, the Nebraska public advocate for natural gas ratepayers, said the fund functions like a reserve for the high cost of contested rate cases and that taking the money would, in effect, make customers pay twice. Tip O’Neil of the Nebraska Telecommunications Association and other witnesses urged continued state support for the Broadband Bridge Program and for the Nebraska Universal Service Fund’s interest to remain available for telecom deployments.
United Way of the Midlands testified about the 211 information‑and‑referral network, saying statute requires an annual grant from NUSF earnings to a 211 cash fund and that LB 264 should include a technical correction to preserve that transfer so the commission can comply with Nebraska Revised Statute 75‑1101(2).
No committee action or formal votes were recorded during the hearing. Commission staff and multiple industry and public‑interest witnesses asked lawmakers to preserve dedicated regulatory and program funds or to allow limited carryforward to complete obligations.
