PREPARED BY: Nikki Swope
LB 609 DATE PREPARED: February 11, 2025
PHONE: 402-471-0042
Revision: 01
As amended by AM157 FISCAL NOTE
LEGISLATIVE FISCAL ANALYST ESTIMATE
ESTIMATE OF FISCAL IMPACT – STATE AGENCIES (See narrative for political subdivision estimates)
FY 2025-26 FY 2026-27
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS
CASH FUNDS $465,237 $12,500 $320,054 $8,750
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS $465,237 $12,500 $320,054 $8,750
Any Fiscal Notes received from state agencies and political subdivisions are attached following the Legislative Fiscal Analyst Estimate.
LB 609 would adopt the Controllable Electronic Record Fraud Prevention Act (Act); to require certain notice to purchasers of gift
certificates or gift cards; to define term s; to provide for forfeiture of convictions for certain offenses involving theft by deception, forgery,
and identity theft; and to provide for forfeiture of violations of controllable electronic records .
The Act defines terms relating to blockchain analytics, controllable electronic records, kiosks, operators, transactions and wallets. The
Act further requires that all kiosk operators maintain a license pursuant to the Nebraska Money Transmitters Act and submit a report
containing the information as outlined in LB 609 to the Nebraska Department of Banking and Finance (NDBF) on a quarterly basis. The
bill further requires that warnings and disclosures shall be made available and include a statement, written prominently and in bold type
and provided separately from the other disclosures, warning customers about the potential for criminals to exploit controllable electronic
record kiosks to commit illicit activity and the criminal penalties for initiating a dishonest scheme.
Section 6 of the bill requires each controllable electronic record kiosk operator shall designate and employ a compliance officer on a
full-time basis to coordinate and monitor compliance with the Controllable Electronic Record Fraud Prevent ion Act and perform other
duties as described in the bill.
These controllable electronic record kiosk operators are not currently subject to regulation under the Nebraska Money Transmitters Act,
which is under the NDBF. The NDBF estimates that there are currently 140 cryptocurrency kiosks located in Nebrask a but the actual
number is unknown. For the purposes of this fiscal note, NDBF only estimates that there are ten operators. An original license fee
under the Act is $1,000 and an annual year-end renewal fee is $250. This will result in an increase in revenue for FY 2025 -26 of
$12,500. It is estimated there would be five new licensees for the next fiscal year and that all existing licenses would be renewed for a
total of $8,750.
Furthermore, the NDBF is currently unable to collect the necessary information and conduct timely audits without additional
examination and administrative staff. The additional information required by LB 609 would require Nebraska to develop a separate
reporting process which would require additional operating expenses in FY 2025 -26 to hire a consultant/developer to create a database
to manage the information obtained from the controllable electronic record addresses. That one-time expense in FY 2025-26 is
estimated at $150,000.
Additionally, the NDBF would need additional staff to meet the requirements of LB 609. To accomplish these duties, NDBF estimates
the need for an additional three FTEs including 1 Senior Examiner, 1 Administrative Programs Officer II and 1 Administrative Programs
Officer I. The personnel cost, including benefits and operating costs, are estimated to be $465,237 in FY 2025- 26 and $320,054 in FY
2026-27 .
Section 12 defines gift certificates or gift cards and provides for notice about the potential fraud to the purchaser. This section further
provides that if the Attorney General has cause to believe this section has been violated, the Attorney General may provide a written
citation to the violator. The Attorney General can absorb any administrative costs that may occur from monitoring any potential
violations.
LB 609 also provides additional criminal provisions, including forfeiture as provided in sections 28-1601 to 28-1603 for violations of
forgery, theft by deception and other covered offenses, as defined by the bill.
CONTINUED ON PAGE 2 LB 609
PAGE 2
AM 157 strikes sections 13,14,15,16, 17, 18, 19, 20, 21 and 22 and inserts a new section. The stricken sections regard sentencing
courts to order forfeiture as provided in sections 28-1601 to 28-1603 and also strikes sections that are outside the prevue of the
Controllable Electronic Record Fraud Prevention Act .
The new section in the amendment adds controllable electronic records as defined in section 8-3003 as property. The amendment
further defines the Act to include holding third parties acting on behalf of a c ontrollable electronic record kiosk operator as liable; defines
the time for an existing customer with the controllable electronic record kiosk operator from thirty days to fourteen days under the Act;
adds additional reporting requirements to NDBF; increases the daily limits for transactions; and adds language for the Attorney
General’s Consumer Protection office to release model notice language as outlined in the amendment.
There is no additional fiscal impact on LB 609 due to AM157.
Please complete ALL (5) blanks in the first three lines. 2025
LB
(1) 609 FISCAL NOTE
State Agency OR Political Subdivision Name:
(2)
Nebraska Department of Banking and Finance
Prepared by:
(3) Shauna Paolini Date Prepared:
(4)
01.29.2025 Phone:
(5)
402-471-4954
ESTIMATE PROVIDED BY STATE AGENCY OR POLITICAL SUBDIVISION
FY 2025-26 FY 2026-27
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS
CASH FUNDS 465,237 320,054
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS 465,237 320,054
Explanation of Estimate:
LB 609 would adopt the Controllable Electronic Record Fraud Prevention Act, which will require that operators
of cryptocurrency kiosks/ATMs be licensed under the Nebraska Money Transmitters Act (Act), which is under
the jurisdiction of the Nebraska Department of Banking and Finance (NDBF). These operators are not
currently subject to regulation. An Internet search indicates there are approximately 140 cryptocurrency kiosks
located in Nebraska, but the number of operators of those kiosks is unknown. For purposes of this fiscal note,
we estimate that there are 10 operators. An original license fee under the Act is $1,000 and an annual year-
end renewal fee is $250. This will result in an increase in revenue for FY 2025- 26 of $12,500. It is estimated
there would be 5 new licensees for the next fiscal year and that all existing licenses would be renewed for a
total of $8,750 (5 x $1,000 + 15 x $250).
The kiosk operators are required to register each kiosk with NDBF and obtain the prior approval of the NDBF
for the kiosk. The operators are required to submit quarterly reports to NDBF for each kiosk that include any associated controllable electronic record address.
LB 609 would have significant impact on the operations of the NDBF Consumer Financial Services division.
NDBF would need to develop a kiosk registration process. The major expenses are due to the fact that NDBF
does not receive data from money transmitter licensees on a quarterly basis that includes any associated
controllable electronic record address. If this bill would pass as written, we would need to collect this data on
a quarterly basis from each of our licensees outside of the Money Services Businesses (MSB) call report filed
in the Nationwide Multi-State Licensing System and Registry (NMLS). NMLS is an online licensing system
created by the Conference of State Bank Supervisors and the American Association of Residential Mortgage
Regulators, that NDBF uses for processing license applications and the filing of reports and processing of fees.
Due to limitations of our current licensing system, we would be unable to collect the necessary information and
conduct necessary timely audits of our licensees’ information without additional examination and administrative
staff. The additional information required by LB 609 would require Nebraska to develop a separate reporting
process, which would require additional operating expenses in FY 2025 to hire a consultant/developer to
create a database to manage the information obtained from the controllable electronic record addresses. That
expense is estimated at $150,000.
NDBF is unable to meet these requirements with existing resources. To accomplish these duties, NDBF
estimates the need for an additional 3 FTEs including 1 Senior Examiner, 1 Administrative Programs Officer II, and 1 Administrative Programs Officer I.
12,500
12,500
$8,750
$8,750 _____________________________________________________________________________________________________ _
BREAKDOWN BY MAJOR OBJECTS OF EXPENDITURE
Personal Services:
POSITION TITLE
NUMBER OF POSITIONS
25-26 26-27
2025-26
EXPENDITURES
2026-27
EXPENDITURES
Senior Examiner 1 1 85,000 87,125
Administrative Programs Officer II 1 1 50,538 51,801
Administrative Programs Officer I 1 1 43,732 44,825
Benefits………………………………...…… 124,156 124,492
Operating…………………………...………. 161,811 11,811
Travel………………………………………..
Capital outlay…………………...…………..
Aid…………………………………………...
Capital improvements……………………...
TOTAL……………………………… ..... 465,237 320,054