Stenberg, 110416 NDAGO, AGO 16-12

Docket Nº:AGO 16-12
Case Date:November 04, 2016
Don Stenberg, State Treasurer
AGO 16-12
No. 16-012
Nebraska Attorney General Opinion
State of Nebraska Office of the Attorney General
November 4, 2016
         SUBJECT: Whether the State Treasurer may loan funds to Gage County pursuant to Neb. Rev. Stat. § 13-918 to pay a judgment awarded to the "Beatrice 6" under 42 U.S.C. § 1983.          REQUESTED BY: Don Stenberg, State Treasurer          WRITTEN BY: Douglas J. Peterson, Attorney General, Natalee J. Hart, Assistant Attorney General          INTRODUCTION          You have requested our opinion on three questions relating to the authority of the Nebraska State Treasurer to loan money to a political subdivision for the payment of a judgment against that political subdivision. Neb. Rev. Stat. § 13-918 (Reissue 2012) provides for a loan from the State Treasurer to a political subdivision for awards or judgments entered pursuant to the Political Subdivisions Tort Claims Act. The "Beatrice 6" have been awarded a judgment in federal court on claims brought under 42 U.S.C. § 1983 against Gage County, Nebraska in excess of $28 million. Gage County lacks sufficient funds to pay the judgment in full and counsel for the Beatrice 6 have suggested that Gage County may borrow the money from the State Treasurer under Neb. Rev. Stat § 13-918 to satisfy the judgment. You have posed the following questions:
(1) Since the judgment [against Gage County in favor of the Beatrice 6] was pursuant to Federal Law rather than the Political Subdivisions Tort Claims Act, does § 13-918 provide legal authority for [the State Treasurer] to make a loan to Gage County, Nebraska?
(2) [I]f so, is the loan limited to a maximum amount of Five Million Dollars since Neb. Rev. Stat. §§ 13-926 and 13-922 both limit total claims to Five Million Dollars arising out of a single occurrence? Given those limits, the Legislature's intent may have been to limit any loan to the maximum amount of recovery under the Political Subdivisions Tort Claims Act; and
(3) [I]f § 13-918 does not authorize the State Treasurer to make a loan to Gage County, and given that state statutes generally provide authority to the Nebraska Investment Council to manage the state's investments, is there any other statute that would authorize the State Treasurer to make a loan to Gage County related to the judgments in question?
         ANALYSIS          Neb. Rev. Stat. § 13-918 provides:
Any awards or judgments pursuant to the Political Subdivisions Tort Claims Act and sections 16-727, 16-728, 23-175, 39-809, and 79-610 shall be paid in the same manner as other claims against the political subdivision. If insufficient funds are available to pay such awards or judgments the governing body shall include sufficient funds in the budget for the next fiscal year or biennial

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