Nebraska tries cleaning up foreign adversary law to salvage state tax incentives

LINCOLN — The Nebraska Legislature is trying to clean up a new law meant to be tough on foreign adversaries.

State Sen. Eliot Bostar of Lincoln, who authored the Foreign Adversary and Terrorist Agent Registration Act that passed in 2025 with Gov. Jim Pillen’s blessing, offered an amendment to an unrelated bill this year, Legislative Bill 1096, that would tweak a definition to fix the issue.

His Amendment 2313 came up during the public hearing for the broader LB 1096 on Thursday in the Legislature’s Judiciary Committee. The broader bill aims to protect the state’s agriculture and economy by criminalizing the illegal import of dangerous pathogens or pests. It also would authorize withholding records detailing vulnerabilities in critical water infrastructure from public records requests and introduce civil and criminal penalties, which critics have said could make it more difficult to independently monitor water pollution.

Bostar’s law last session aimed to monitor and challenge the influence in the state of certain foreign governments, including China and Iran. It requires that anyone acting here on behalf of an adversarial nation register with the state and had sought to prohibit access to state tax incentives for businesses in adversarial countries but defined the term loosely enough that the Nebraska Department of Revenue interpreted the language as covering any company with a subsidiary in China, as the Flatwater Free Press reported.

Bostar’s proposed tweak comes after the nonprofit news outlet’s reporting on business incentives being paused for giant homegrown companies in agriculture, construction and more, including Valmont, Lindsay and Werner.  

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Bostar told the Examiner that his amendment would clarify that the state should use the definition of a “foreign adversarial company” from the registration provisions of his 2025 law.

Kenny Zoeller, director of the governor’s Policy Research Office, said Pillen supports the tweak. 

A spokesperson for the Greater Omaha Chamber of Commerce expressed support for the amendment. No one testified against the amendment.

New Pillen-championed law gets tough on China, may cost Nebraska companies

Jessica Shelburn, deputy director of the Nebraska Department of Agriculture, said the department supports the broader bill because it would help the agency stop the introduction of “toxin organisms” that can be a risk to agriculture in the state. 

Thomas O’Neill, president of the Nebraska Telecommunications Association, said the group is against it because the penalties for missing the state deadline are mandatory. 

One member of the Judiciary Committee asked Bostar if it was “okay” for companies to have subsidiaries based in an adversarial nation. 

“I don’t know if I would say it’s okay, but I would say you’re going to get to keep your incentives,” Bostar said. 

The committee took no immediate action on the amendment or broader bill.

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