LINCOLN — Gov. Jim Pillen and his administration have blamed problems with the state’s handling of an emergency no-bid bioeconomy contract on employees of a state agency.
Yet Nebraska State Auditor Mike Foley says his referral to the attorney general also questions actions by some top staff under the governor’s direct control.
Last weekend, some Pillen staff told legislative leaders and others around the Capitol that the auditor’s referral to Nebraska Attorney General Mike Hilgers would probe the Nebraska Department of Economic Development, the state agency Foley audited — and would not reach the Governor’s Office or senior staff, people familiar with the conversations said.
The auditor says his referral raises concerns about the nature and degree of Governor’s Office influence on how DED staff pursued and carried out the state’s $2.5 million emergency no-bid contract with Lincoln-based Global Sustainability Developers, led by agricultural tech CEO Julie Bushell, whom Pillen has said he recommended.
Foley says it increasingly appears that the Governor’s Office knew who it wanted to contract with for the bioeconomy work and may have steered the entire process to get the desired result regardless of state contracting law, including the timeline in legislation the office requested and likely helped draft.
“Yes,” the auditor told the Examiner. “It is about more than DED. It could reach higher.”
One part of the audit questions DED’s choice not to fill out a required written justification of what emergency allowed the state to forgo competitive bidding for the contract, which the governor and his administration have blamed on DED staff. A former DED staffer has said the idea came from higher up.
No office comment prior to publication
The Examiner, which has spoken to the Governor’s Office before each of its contract-related stories, asked Pillen’s staff for comment multiple times over the past week — Friday, Monday, Wednesday and Thursday. The Governor’s Office provided no statement prior to publication. The governor has taken no questions from the Capitol press corps at a Governor’s Office or Capitol news conference for more than two weeks.
But Pillen did address the contract in separate appearances Monday on the monthly statewide radio call-in show he hosts and Tuesday on conservative Omaha talk radio station KFAB, where he said he does not see it as a crime that DED decided not to fill out a legally required justification for skipping the step of bidding out state contracts larger than $50,000.
“There’s been paperwork omissions going on within the department for way before we came into office,” Pillen told KFAB. “So, you know, paperwork omissions are criminal, I guess. I guess … somebody in our department is guilty of paperwork omissions and lack of discipline. I don’t think that’s criminal.”
Pillen’s argument does not address a key issue in Foley’s audit letters: that Pillen staff told Foley’s audit team that tight timing to turn in a legislative report was the legal justification for circumventing normal bidding processes. The administration said it needed a contractor in place to meet the key administrative deadline.
Timing fight continues
Pillen and some in his administration have said they needed to get Bushell working quickly in 2024 to have the best chance to access more of the hundreds of millions of dollars in federal funding available near the end of the Biden administration. They called her help pivotal in getting Nebraska a larger share.
The administration continues to argue that the deadline to pick a contractor by the end of June 2024 left them too little time to send the contract out for bids, a stance that Foley has said is simply not true because of the control the Governor’s Office had over the process and the timing set in the language his office sought.
“Why the emergency?” Pillen asked on KFAB. “Guys, really simple: Can’t lose time. Time is of the essence, that’s as simple as the story is when we talk about the no contract bid or whatever the case is.”
Foley disagrees: “My first letter clearly explains how an expedited process could easily have been employed to legally bring on a contractor just as quickly as Julie was hired. Also, the governor fails to mention that the application development work was done prior to the start of Ms. Bushell’s contract.”
Was the auditor misled?
Foley noted that the administration has since told the Examiner something it had not told him — that the governor’s team had tapped Bushell to do the work of chasing late Biden-era federal funds months before the Legislature approved funding for a state bioeconomy contractor, work the administration says she did for free.
The auditor says that work before lawmakers approved the bioeconomy pay and position in Legislative Bill 1412 in April 2024 makes it harder to argue the Pillen administration had too little time to bid out the contract under normal non-emergency rules, competition meant to save taxpayers money.
Foley said the Pillen team’s evolving explanations of why, how and when it chose to go with Bushell could shift some of the probe’s focus toward staff directly under the governor’s control, including why and how the state chose not to provide a written emergency justification for the bioeconomy contract.
Foley stopped short of saying shifting stories from Pillen staff about the justification made him feel misled in the course of his work. Misleading the state auditor is a misdemeanor in Nebraska. Authorities will have to determine that, he said, but the changes make him curious about top staff’s level of involvement.
Hilgers, through a spokeswoman, has already confirmed receipt of Foley’s probe. His spokeswoman did not immediately respond to an additional request for comment this week about Foley’s description of his referral. The AG’s Office rarely, if ever, discusses referrals or investigations.
Team Pillen touts results
The state agency that handles economic development awarded Bushell’s firm the bioeconomy contract in May 2024, after passage of LB 1412, the budget bill that authorized the state to pay a consultant to boost the state’s profile and success in the bioeconomy space, which Pillen’s team says Bushell did well.
Global Sustainability Developers was paid about $208,333 a month for a remote work contract that Bushell and Pillen’s team have said helped the state access more than $307 million in federal funds for green-energy and similar projects near the end of the Biden administration, leaning on her relationships with Biden’s team.
She and Pillen also have touted her ability to connect the state with agribusiness developers interested in building major industrial projects tied to the state’s agricultural advantages, including a project near Holdrege promising a sustainable aviation fuel plant, a niche locals wanted in the ethanol and biodiesel space.
Foley has questioned process, value
Foley’s audit letters have questioned whether the Biden-era federal money could have been secured without her help, given how much other states also received without her firm’s involvement. He also questioned whether a biofuels project planned for Phelps County would be built based on results in other states.
Pillen during his radio call-in show Monday defended his staff’s actions.
“We followed the letter to the ‘T,’” the governor said of the law. “When somebody wants to start using the word ‘criminal’ – that somebody on my team did something wrong – I have their back. Our team followed everything to the ‘T,’ and … I’m really proud of what we did.”
During the same show, Pillen said: “We did what many governors have done over time. It’s called sole source. You can call it ‘emergency.’ We did a sole-source bid, and the results are extraordinary. We got over $300 million home.”
Foley repeated that in government and law, the “ends do not justify the means.”
Pillen recommended Bushell
Pillen told Foley during his investigation that he had recommended Bushell’s firm. The governor knew her from state agricultural trade missions, having crossed paths at local events and other state-related travel.
KFAB hosts on Tuesday asked Pillen about online rumors and innuendo about the nature of the governor’s relationship with Bushell. The governor said he had known her for up to three years and called their relationship professional.
“My connection with Julie would be the same as it was with other contractors,” the governor said. “I’m listening to people in countless meetings, when people speak and they have a vision, they have something that makes really, really good sense and is way above average. … That’s my relationship.”
Report timing questioned
Foley said much of his referral to the AG focused on how Economic Development staff mishandled missing a legal deadline for turning in the required report to the Legislature on bioeconomy progress — the report Pillen’s staff had said was a key reason the state had to enter the emergency no-bid deal with GSD and Bushell.
That report was not written until more than a week after the June 30, 2025, deadline in state law, the report’s author has told the Examiner. It was jump-started after Foley requested a copy during his investigation of the contract in early July 2025.
Foley’s latest audit letter on his bioeconomy contract probe focused on DED’s attempt to back-date that filing. He says he felt misled by DED leaders who missed the June 30, 2025, deadline and then back-dated the report when filing it.
Pillen acknowledged the rising tensions about the state contract with KFAB. He signaled that he was aware of legislative efforts to consider an independent legislative investigation of the contract — and said he was open to them.
“You know, I don’t play politics,” Pillen said. “If somebody wants to make accusations, hey, let’s put the process in, and I’m proud of what our team has done.”
