LINCOLN, NEB. Nebraska is running out of options in trying to avoid paying a $151 million judgment for blocking construction of a waste dump for low-level radioactive waste within its borders.
The 8th U.S. Circuit Court of Appeals on Wednesday upheld an earlier ruling by U.S. District Judge Richard Kopf of Lincoln.
Kopf ruled that former Gov. Ben Nelson, now a U.S. senator, engaged in a politically motivated and orchestrated plot to keep the dump from being built in Nebraska.
Kopf said Nelson's office "directly interfered with the regulatory process."
"Frankly, I cannot conceive of a stronger case of bad faith in the performance of a contract," Kopf said.
The dump was to hold waste from Nebraska, Kansas, Arkansas, Louisiana and Oklahoma -- which joined in 1983 to form the Central Interstate Low-Level Radioactive Waste Compact.
Atty. Gen. Jon Bruning said the ruling "is obviously bad news for the state of Nebraska."
'Not the end of the line'
The state could ask for a rehearing by the three-judge panel or the entire 8th Circuit or appeal directly to the U.S. Supreme Court.
"It is safe to say this is not the end of the line," Bruning said. "The state has resources at risk here."
Gov. Mike Johanns stressed that an initial ruling by Kopf in the case saying that Nebraska appeared to have acted in bad faith made it nearly impossible to settle the matter out of court. Kopf made that ruling in 1999 -- soon after Johanns took office.
Johanns said he believed it would be possible to build a safe site in Nebraska.
"After all, we are generating waste in this state," he said.
But Kopf's initial ruling "made it very, very difficult for us to get any kind of settlement negotiations going," Johanns said, noting that each subsequent ruling in the case has become "more and more and more forceful."
Johanns said while it was likely the state would appeal, he planned to begin talking with lawmakers about trying to find the money to pay the judgment.
"I don't want to sugar coat this in any way," Johanns said. "It does create an economic consequence that is very enormous."
Johanns and lawmakers already are wrestling with a $211 million budget shortfall this session.
Commission attorney Alan Peterson was traveling and could not immediately be reached for comment.
Undermining the process
Nebraska officials argued that they refused to license the dump because of concerns over possible pollution and a high-water table at the proposed site in Boyd County near the South Dakota border.
The court rejected those claims, saying Nelson "had campaigned on a pledge to block construction of the disposal facility.
"The record shows that the administration began to develop and implement a plan to undermine the licensing process," wrote Judge Diane Murphy.
Nelson released a statement Wednesday that said: "I will stand by the decision to deny the license until or unless the state agency regulators say they erred. I have no reason to believe that the decision was based on anything other than environmental and safety concerns."
The court also rejected Nebraska's contention that Kopf was wrong to reject the state's request for a jury trial.
Kopf refused to seat a jury for the case partly because its members would be made up of taxpayers who ultimately would have to pay the bill if Nebraska lost the case.
Kopf said the law did not allow jury trials in disputes between states.
Utilities that generate radioactive waste filed the lawsuit, accusing Nebraska officials of acting in bad faith by not licensing the facility in 1998. Other states in the waste compact later joined the lawsuit.
The battle had its genesis in 1970, when Nevada, South Carolina and Washington grew tired of accepting low-level radioactive waste from the rest of the country.
Congress told states in 1980 to build their own dumps or join regional groups to dispose of the waste, which includes contaminated tools and clothing from nuclear power plants, hospitals and research centers.
The other states in the Central Interstate compact voted in 1987 to put the dump in Nebraska.
The fight began soon after, with both sides wrestling in court on several issues.