LINCOLN — The Pillen administration faces new questions this week over whether a compressed timeline justified the Nebraska Department of Economic Development rushing into a $2.5 million no-bid emergency bioeconomy contract with a firm Gov. Jim Pillen recommended, run by a lobbyist he knew.

Pillen’s team has said the Legislature, in passing a bill the governor sought, left it too little time in April 2024 to go through a competitive bidding process. The Governor’s Office has argued that, without DED’s emergency approach, the agency could not have met the law’s 15-month deadline to issue a required report to the Legislature on bioeconomy progress.

But State Auditor Mike Foley now alleges DED did not meet the June 30, 2025, legal deadline for filing the report. DED filed the report with the Legislature electronically at 1:18 p.m. on July 11, three days after Foley requested a copy in an audit-related meeting with former DED director K.C. Belitz. That’s according to Foley’s Jan. 28 follow-up correspondence to his Jan. 6 audit letter. 

Foley noted that while being late on a state report carries no legal penalty, he said it undermines the administration’s argument that time pressure required skipping competitive bidding. 

“It’s ironic that there was this great emergency to get this report to the Legislature, that they didn’t even file the report,” Foley told the Examiner on Wednesday. 

Several people familiar with how the report was compiled told the Examiner that DED had not written the report until Foley asked. They spoke on condition of anonymity for fear of political and professional retribution. Some said the ball got dropped after the state ended the contract with Pillen’s preferred bioeconomy contractor, Global Sustainability Developers of Lincoln, and its leader, tech company CEO Julie Bushell, in February 2025. 

Foley said he started requesting information about the state contract in mid-January 2025. Pillen himself told Foley he had recommended Bushell’s firm but argued that his appointee at DED had joined him in recommending her.

‘There Was No Report’

Joe Lauber, a former deputy DED director who had served as the agency’s legal counsel before being laid off amid a DED shakeup around the time Foley and others were questioning the contract, said Wednesday that Belitz asked him shortly after the Foley meeting to compile a report from eight to 12 monthly invoices Bushell had submitted before the contract ended.

“There was no report,” Lauber said Wednesday of the day Belitz asked him. “It did not exist. What I remember is K.C. Belitz saying we need to have a report. I said, ‘OK, what report?’ He sent me a bunch of monthly things and said to make that into a report and to post it, and that’s what we did.”

Current DED Deputy Director Joe Fox, reached Wednesday, referred questions to department spokesman Justin Pinkerman, who confirmed that the bioeconomy report “appears to have been compiled and submitted after the deadline” in state law of June 30, 2025. He said some elements included in the report had been written before the deadline, including “The Nebraska Bioeconomy Handbook” and a GSD summary of the bioeconomy initiative.

Belitz resigned in June 2025 and returned no calls seeking comment. Bushell did not respond to messages requesting comment for this story. She and the Governor’s Office previously defended her work as having delivered hundreds of millions more in federal dollars to the state near the end of the Biden administration than Nebraska might have otherwise accessed and said she had good bioeconomy business connections.

Lauber said he spoke out now after reading Foley’s two letters on the contract and the Governor’s Office’s responses, as well as worrying that people would get the impression that he or others in DED had acted without direction. Little was done regarding the Bushell contract without the knowledge or input of Pillen Chief of Staff Dave Lopez, Lauber and at least three others with ties to DED work said. The others were worried about professional ramifications.

Language changes to the GSD contract that Foley’s initial audit letter highlighted, including the contract’s conflict of interest language and the contract’s early ending, included Lopez and required his approval, Lauber said.

“We would try to draft something. Julie would draft something. It would go back and forth. And we had to get the approval of Lopez to do anything,” Lauber said.

Lauber acknowledged that he, on the section of the GSD contract, was the one who failed to fill out the Foley-criticized section of the state’s “Procurement Exception/Deviation” form that the state contracting office has since revised to make clearer that it must be filled out on emergency no-bid contracts. That oversight was a focus of much of Foley’s first audit letter about the contract, which was the subject of an in-depth report first reported by the Examiner.

“That probably is a legitimate mistake on my part,” he said. “The form is ambiguous. That was not intentionally done.”

But he said the recommendation that DED pursue the GSD deal as an emergency no-bid contract in 2024 came from Lee Will, then the state budget director and now the DAS director. Lauber said it came during a meeting about every other Tuesday with Lopez, Will, and other officials from the Pillen administration.

Pillen Staff, Foley Respond

The Pillen administration repeated its belief this week that the law left DED only until the end of June 2024 to initiate the contract’s work, which the administration said gave the agency too little time to go through a traditional bidding process. Foley, again on Wednesday, disagreed, arguing that the Legislature gave DED “15 months to do a 12-month study.” 

The auditor also reiterated that the Governor’s Office knew the bill was coming and could have used requests for information to gauge interest from potential bidders and have them ready to roll when the Legislature passed Legislative Bill 1412, a budget adjustments bill.

“There was ample time,” said Foley, a former lieutenant governor and former state senator. “There was no emergency. It was an invented emergency.”

The Pillen administration’s statement Wednesday evening deemphasized the legislative report it had emphasized in previous interviews and said it needed to hurry because “hundreds of millions of dollars were being awarded by the Biden administration in 2024,” which it had previously argued was one of the major chunks of value Nebraskans received.

“The contract that was awarded and executed helped secure $307 million in federal funding for Nebraska,” Pillen spokeswoman Laura Strimple said. “The report uniquely required by LB 1412 was filed late, and administrative action has been taken to prevent this in the future.” 

Foley noted that the legislative report deadline was a specific timeline the Pillen administration had cited in earlier explanations for bypassing the competitive bidding process, both to his audit team and to the Examiner.

Foley Frustrated With Back-Dating

Much of Foley’s letter focused on frustrations about how DED handled the late filing. Foley’s letter notes that DED sent the auditor a copy before it had filed the legislative report required by the 2024 law the Governor’s Office cited as the reason DED did not competitively bid out the contract.

Foley also alleges that DED back-dated the report filed with the Legislature using the June 30 due date and alleges that by doing so, the agency may have broken state public records law by providing information in a public document that it knew was false. He notes that the electronic document submitted was created after his meeting.

“It’s no big deal that they filed it late,” Foley said. “It’s close enough for government work. It’s actually a criminal penalty to try and mislead the auditor. We can see when those documents were created, and they were created after the fact.”

Nebraska law prohibits anyone from willfully obstructing, hindering or misleading staff from Foley’s office. Violations are a Class II misdemeanor. 

Lauber, asked why the DED report to the Legislature was back-dated, said he did not know but described the practice of doing so as a common one in state government as a whole. He worked at DED for 13 years.

Lauber said he did not know Bushell or her business, nor did he deal with her. He said within the DED office, Belitz dealt most directly with the Governor’s Office and with Bushell. For instance, Lauber said Belitz shared financial reports from Bushell with DED staff. DED has been led since Belitz’s departure by Pillen’s former in-house legal counsel in the Governor’s Office, Maureen Larsen.

The agency has seen its staffing decline recently under Pillen, whose team has argued the reductions were just an effort to get to pre-pandemic staffing levels. Many of the departures happened during or after the GSD contract or while it was being investigated by the Auditor’s Office. 

“I’m not perfect,” Lauber said. “I make mistakes. But I’m not part of this deal. In my former job, I’m a mechanism of government carrying out the directions of my boss. I have nothing to gain or lose from doing a contract with a person I do not know.”

Pillen Makes First Comments

Pillen knew Bushell, having traveled with her to South Korea, Japan and Washington, D.C., as part of state delegations, as well as joining her at the 2024 Republican National Committee meeting in Milwaukee. They also were photographed together while attending the 2024 Aksarben Ball in Omaha. Pillen’s team has said Bushell came recommended by “Aksarben,” a reference to a group of top Omaha business leaders.

Sandra Reding, president of the Aksarben Foundation, said in a Jan. 21 statement to the Examiner, “Aksarben has not made any recommendations to the governor or any of his staff regarding Global Sustainability Developers and any [bioeconomy] contract with the State of Nebraska.”

Pillen, who has not commented about the audit or letters to the Examiner, criticized Foley during an interview with Axtell, Nebraska-based NTV on Jan. 20. Pillen said the state was under a “tight timeline with the Legislature” and that the state did a contract “within the law,” “within the budget” and “voted on by the Unicameral.”

The governor said Foley was “100% wrong.”

“Mike Foley’s wrong on the facts, and he’s wrong on the law,” Pillen told NTV. “It’s just as simple as that.”

Strimple, asked to clarify what the governor meant, said Foley did not “seem to value the urgency of Nebraska getting its share of the federal money that was being handed out” in 2024. She said “the Pillen administration believes the well-established emergency contracting provision was the only legal option given the timeline.”

Foley, after being shown Pillen’s comments and the administration’s argument, said: “I stand by every word of my report. It is rock solid.”

This story was published by Nebraska Examiner, an editorially independent newsroom providing a hard-hitting, daily flow of news. Read the original article: https://nebraskaexaminer.com/2026/01/29/ded-pillen-back-in-foleys-crosshairs-over-justification-for-emergency-no-bid-contract/