LINCOLN — Gov. Dave Heineman took three state senators from Omaha to task Tuesday, accusing them of reaching a “secret agreement” with University of Nebraska officials on a plan to seek local government funding for the proposed $370 million cancer and research center.
During a news conference Tuesday at the State Capitol, the governor called out Sens. Heath Mello, Jeremy Nordquist and Abbie Cornett for failing to disclose that NU officials planned to approach the City of Omaha and Douglas County for contributions toward the University of Nebraska Medical Center project.
The governor said he agreed to support the state's $50 million contribution toward the project with the understanding the university would seek $200 million in private donations. Heineman said he was never told NU officials planned to solicit other public funds.
Douglas County recently committed $5 million toward the project while the Omaha City Council is considering beginning an occupation tax on cigarettes to contribute $35 million.
“Why didn't it get raised on the floor of the Legislature?” Heineman asked Tuesday, saying the senators and NU officials need to publicly explain what happened.
The senators on the receiving end of the governor's criticism fired back by saying Heineman was trying to frame the controversy as a partisan issue.
Mello and Nordquist are Democrats, while Cornett is a Republican in the officially nonpartisan Legislature.
“It was on every whiteboard I saw,” said Cornett, who is head of the Legislature's Revenue Committee. “There was no secret deal.”
When NU President J.B. Milliken testified at a public hearing before the Legislature's Appropriations Committee, he said the plan was to pay for the center with $50 million in state funding, $200 million in private money and $120 million in debt financing, Heineman said.
Mello, in response, said that while the pursuit of additional public funding wasn't clearly stated at the hearing, he learned about it in a series of private meetings afterwards. A member of the Appropriations Committee, Mello said officials told him they planned to partner with the Omaha Public Power District and the City of Omaha for financial support.
“A specific tax was never discussed, but they were very clear they were going to look at other public funds, and other public partners, because of the size of the project,” the senator said.
He said it was “ridiculous” for the governor to call it a “secret” agreement, noting that Heineman initially opposed the cancer center project because it would take away money from the governor's proposal to cut state income taxes.
In February, the governor compared NU to a wealthy “special interest group” with its hand out for taxpayer dollars while the state's citizens wanted tax relief.
But Heineman later changed course, stating he could support the project because of its potential for economic development if state funding was tied to private fundraising milestones.
Mello said that Heineman's accusations were partisan and that “he has very little to say because he wasn't a fan from the beginning.”
Cornett said that she couldn't say what the governor did or didn't know but that she was told the university would seek other public funding. Officials mentioned the city as well as Douglas County.
NU officials didn't talk to her about using an occupation tax on cigarettes, probably because she's not a fan of occupation taxes, Cornett said. She called the taxes largely unregulated by the state and difficult to track for taxpayers.
“That's a very controversial means to fund the project,” she said of the cigarette tax idea.
The governor said the cancer center is a worthy project that will benefit the state but said he would not have supported state funding for it had he known the university would seek additional government funds.
“They're on the verge of losing my trust and confidence,” Heineman said, referring to university leaders. He added that he fully expects the issue to return during next year's legislative session.
Cornett said she was frustrated that the governor was playing politics with the issue because she and Omaha Sen. John Nelson, also a Republican, introduced the cancer center bill.
“We had two Republicans working their asses off to get it through, as did two Democrats. It's not a partisan issue,” said Cornett.
Helping fund the center was a priority for the Legislature, Mello and Cornett said. Mello maintained the governor offered his support only after it became clear lawmakers had enough votes to override a veto.