Balancing progress and challenges: Nebraska’s Data Privacy Act

On Jan. 1, Nebraska joined a growing number of states with comprehensive data privacy laws, marking a significant step forward in safeguarding the digital rights of its residents. Passed unanimously by a 47-0 vote in April and signed into law by the governor, the Nebraska Data Privacy Act (NDPA) reflects a nationwide trend toward enhanced protections for personal information in an increasingly interconnected world. The law, while commendable, also highlights the complexities and burdens it places on businesses, particularly small enterprises, which deserve careful consideration.

The NDPA establishes Nebraska as a leader in consumer data protection, granting residents important rights such as access to personal data, correction of inaccuracies, and the ability to opt out of targeted advertising and data sales. It applies to businesses that conduct transactions within the state or provide services consumed by Nebraska residents, regardless of revenue or customer base size. By omitting revenue thresholds, the Act ensures comprehensive coverage but also widens its impact to encompass a vast array of businesses, including smaller entities that may lack the resources to easily comply.

The law’s requirements are thorough and forward-thinking. Controllers – entities determining the purposes and means of data processing – must provide clear privacy notices, collect consumer consent for processing sensitive data, and conduct data protection impact assessments for high-risk activities. These measures reflect best practices in global data privacy, including elements of the European Union’s General Data Protection Regulation (GDPR). They aim to ensure transparency, accountability, and fairness in data handling practices.

Yet, these noble aims come with significant challenges. Compliance with the NDPA demands considerable administrative, technical, and financial resources. Small businesses, in particular, may struggle to develop the infrastructure necessary to meet these obligations, from creating secure data systems to hiring legal and IT experts. Even well-intentioned businesses risk unintentional violations, facing penalties of up to $7,500 per infraction.

Additionally, the NDPA requires controllers to respond to consumer requests within strict time frames, perform risk-benefit analyses for certain data activities, and adhere to technological opt-out signals. These stipulations, while ensuring robust consumer protections, compound the operational pressures on businesses already navigating complex regulatory landscapes. Such measures are critical for preventing abuses, but they also reflect a broader reality: the actions of a few bad actors often result in additional burdens for all.

The Nebraska Data Privacy Act is an important milestone, demonstrating a strong commitment to consumer rights in a digital age fraught with privacy concerns. At the same time, we must acknowledge the burdens it imposes, particularly on small businesses. Each new layer of regulation adds complexity, labor costs, and opportunities for missteps.

As Nebraskans, we should remain vigilant to ensure that this law achieves its intended goals without unnecessarily stifling innovation or overburdening our local businesses. Striking this balance will require ongoing dialogue between lawmakers, businesses, and consumers.

Ultimately, the NDPA underscores a fundamental truth: because of the misdeeds of a few, businesses – particularly smaller ones – must bear the weight of additional oversight. Meanwhile, society as a whole accumulates yet another layer of government. While the goals of the NDPA are laudable, its implementation serves as a reminder of the delicate balance required to foster both individual privacy and economic vitality.