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Related Parties
 12 Months Ended
Dec. 31, 2024
Related Party Transactions [Abstract]  
Related Parties Related Parties (dollar amounts in this note are not in thousands)
Transactions with Union Bank and Trust Company
Union Bank is controlled by Farmers & Merchants Investment Inc. (“F&M”), which owns a majority of Union Bank's common stock and a minority share of Union Bank's non-voting, non-convertible preferred stock. Michael S. Dunlap, Executive Chairman and a member of the board of directors and a significant shareholder of the Company, along with his spouse and children, owns or controls a significant portion of the stock of F&M, and Mr. Dunlap's sister, Angela L. Muhleisen, along with her children, also owns or controls a significant portion of F&M stock. Mr. Dunlap serves as a Director and Co-Chairperson of F&M, and as a Director of Union Bank. Ms. Muhleisen serves as a Director and Co-Chairperson of F&M and as a Director, Chairperson, and member of the executive committee of Union Bank. Union Bank is deemed to have beneficial ownership of a significant number of shares of the Company because it serves in a capacity of trustee or account manager for various trusts and accounts holding shares of the Company, and may share voting and/or investment power with respect to such shares. Mr. Dunlap and Ms. Muhleisen beneficially own a significant percent of the voting rights of the Company's outstanding common stock.
The Company has entered into certain contractual arrangements with Union Bank. These transactions are summarized below.
Loan Purchases
The Company purchased $104.2 million (par value) and $467.6 million (par value) of federally insured loans in 2024 and 2023, respectively, from Union Bank. The Company purchased $8.1 million (par value) of private education loans in 2022 from Union Bank. The premium paid by the Company on the private loan acquisitions was $0.2 million in 2022. The premiums paid by the Company for loan purchases in 2024 and 2023 were insignificant.
Loan Servicing
The Company serviced $143.6 million, $173.8 million, and $203.4 million of FFELP and private education loans for Union Bank as of December 31, 2024, 2023, and 2022, respectively. Servicing revenue earned by the Company from servicing loans for Union Bank was $0.2 million, $0.3 million, and $0.4 million in 2024, 2023, and 2022, respectively.
Funding - Participation Agreements
The Company maintains an agreement with Union Bank, as trustee for various grantor trusts, under which Union Bank has agreed to purchase from the Company participation interests in student loans. The Company uses this facility as a source to fund FFELP student loans. As of December 31, 2024 and 2023, $687.1 million and $295.1 million, respectively, of loans were subject to outstanding participation interests held by Union Bank, as trustee, under this agreement. The agreement automatically renews annually and is terminable by either party upon five business days' notice. This agreement provides beneficiaries of Union Bank's grantor trusts with access to investments in interests in student loans, while providing liquidity to the Company on a short-term basis. The Company can sell participation interests in loans to Union Bank to the extent of availability under the grantor trusts, up to $900 million or an amount in excess of $900 million if mutually agreed to by both parties. Loans participated under this agreement have been accounted for by the Company as loan sales. Accordingly, the participation interests sold are not included on the Company's consolidated balance sheets.
The Company maintains an agreement with Union Bank, as trustee for various grantor trusts, under which Union Bank has agreed to purchase from the Company participation interests in FFELP loan asset-backed securities (investments). As of December 31, 2024 and 2023, $0.1 million of FFELP loan asset-backed securities were subject to outstanding participation interests held by Union Bank, as trustee, under this agreement. The FFELP loan asset-backed securities under this agreement have been accounted for by the Company as a secured borrowing.
Funding - Real Estate
401 Building, LLC (“401 Building”) is an entity that was established in 2015 for the sole purpose of acquiring, developing, and owning a commercial real estate property in Lincoln, Nebraska. The Company owns 50% of 401 Building. On May 1, 2018, Union Bank, as lender, received a $1.5 million promissory note from 401 Building. The promissory note carries an interest rate of 6.00% and has a maturity date of December 1, 2032.
330-333, LLC (“330-333”) is an entity that was established in 2016 for the sole purpose of acquiring, developing, and owning a commercial real estate property in Lincoln, Nebraska. The Company owns 50% of 330-333. On October 22, 2019, Union Bank, as lender, received a $162,000 promissory note from 330-333. The promissory note carries an interest rate of 6.00% and has a maturity date of December 1, 2032.
TDP Phase III (“TDP”) is an entity that was established in 2015 for the sole purpose of acquiring, developing, and owning a commercial real estate property in Lincoln, Nebraska. The Company owns 25% of TDP. On December 30, 2022, Union Bank, as lender, received a $20.0 million promissory note from TDP. The promissory note carries an interest rate of 5.85% and has a maturity date of January 1, 2028. As of December 31, 2024, the outstanding balance of the note was $18.9 million.
Operating Cash Accounts
The majority of the Company's cash operating accounts are maintained at Union Bank. The Company also invests amounts in the Short Term Federal Investment Trust (STFIT) of the Student Loan Trust Division of Union Bank, which are included in “cash and cash equivalents - held at a related party” and “restricted cash - due to customers” on the consolidated balance sheets. As of December 31, 2024 and 2023, the Company had $511.1 million and $459.1 million, respectively, invested in the STFIT or deposited at Union Bank in operating accounts, of which $365.4 million and $325.9 million as of December 31, 2024 and 2023, respectively, represented cash collected for customers. Interest income earned by the Company on the amounts invested in the STFIT and in cash operating accounts in 2024, 2023, and 2022, was $5.2 million, $4.7 million, and $1.2 million, respectively.
Educational 529 College Savings Plan
The Company provides certain Educational 529 College Savings Plan administration services to certain college savings plans (the “College Savings Plans”) through a contract with Union Bank, as the program manager. Union Bank is entitled to a fee as program manager pursuant to its program management agreement with the College Savings Plans. For the years ended December 31, 2024, 2023, and 2022, the Company has received fees of $2.7 million, $2.5 million, and $2.1 million, respectively, from Union Bank related to the administration services provided to the College Savings Plans.
Additionally, Union Bank, as the program manager for the College Savings Plans, has agreed to allocate plan bank deposits to Nelnet Bank. As of December 31, 2024 and 2023, Nelnet Bank had $269.1 million and $413.2 million, respectively, in deposits from the funds offered under the College Savings Plans.
STFIT Deposits at Nelnet Bank
The Union Bank Trust Department (STFIT) held a deposit balance at Nelnet Bank for $0.1 million and $52.1 million as of December 31, 2024 and December 31, 2023, respectively.
Lease Arrangements
Prior to the lease agreement expiration in 2023, Union Bank leased approximately 4,100 square feet in the Company's corporate headquarters building. Union Bank paid the Company approximately $55,000 and $82,000 for commercial rent and storage income during 2023 and 2022, respectively.
During 2023, the Company entered into a lease agreement with Union Bank for office space in Omaha, Nebraska. The Company paid Union Bank $1.1 million in rent pursuant to this agreement prior to terminating the lease in 2023, at which time the Company paid a $2.4 million termination fee to Union Bank.
Other Fees Paid to Union Bank
During the years ended December 31, 2024, 2023, and 2022, the Company paid Union Bank approximately $373,000, $592,000, and $177,000, respectively, in investment custodial and correspondent services for Nelnet Bank, cash and flexible spending accounts management, and trustee and health savings account maintenance fees.
Other Fees Received from Union Bank
During the years ended December 31, 2024, 2023, and 2022, Union Bank paid the Company approximately $348,000, $351,000, and $342,000, respectively, under certain employee sharing arrangements.
401(k) Plan Administration
Union Bank administers the Company's 401(k) defined contribution plan. Fees paid to Union Bank to administer the plan are paid by the plan participants and were approximately $776,000, $852,000, and $793,000 during the years ended December 31, 2024, 2023, and 2022, respectively.
Investment Services
Union Bank has established various trusts whereby Union Bank serves as trustee for the purpose of purchasing, holding, managing, and selling investments in student loan asset-backed securities. WRCM, an SEC-registered investment advisor and a non-wholly owned subsidiary of the Company, has a management agreement with Union Bank under which WRCM performs various advisory and management services on behalf of Union Bank with respect to investments in securities by the trusts, including identifying securities for purchase or sale by the trusts. The agreement provides that Union Bank will pay to WRCM annual fees of 10 basis points to 25 basis points on the outstanding balance of the investments in the trusts. As of December 31, 2024, the outstanding balance of investments in the trusts was $2.2 billion. In addition, Union Bank will pay additional fees to WRCM which equal a share of the gains from the sale of securities from the trusts or securities being called prior to the full contractual maturity. For the years ended December 31, 2024, 2023, and 2022, the Company earned $3.8 million, $5.5 million, and $4.9 million, respectively, of fees under this agreement.
WRCM also has management agreements with Union Bank under which it is designated to serve as investment advisor with respect to the assets (principally Nelnet stock) within several trusts established by Mr. Dunlap and his spouse, and Ms. Muhleisen. Union Bank serves as trustee for the trusts. Per the terms of the agreements, Union Bank pays WRCM five basis points of the aggregate value of the assets of the trusts as of the last day of each calendar quarter. As of December 31, 2024, WRCM was the investment advisor with respect to a total 450,097 shares and 4.2 million shares of the Company's Class A and Class B common stock, respectively, held directly by these trusts. For the years ended December 31, 2024, 2023, and 2022, the Company earned approximately $257,000, $249,000, and $216,000, respectively, of fees under these agreements.
WRCM has established private investment funds for the primary purpose of purchasing, selling, investing, and trading, directly or indirectly, in student loan asset-backed securities, and to engage in financial transactions related thereto. Mr. Dunlap, Jeffrey R. Noordhoek (an executive officer of the Company), Ms. Muhleisen, and WRCM have invested in certain of these funds. Based upon the current level of holdings by non-affiliated limited partners, the management agreements provide non-affiliated limited partners the ability to remove WRCM as manager without cause. WRCM earns 50 basis points annually on the outstanding balance of the investments in these funds, of which WRCM pays approximately 50% of such amount to Union Bank as custodian. As of December 31, 2024, the outstanding balance of investments in these funds was $106.6 million. The Company paid Union Bank $0.3 million in each of 2024, 2023, and 2022 as custodian of the funds.
Transactions with Agile Sports Technologies, Inc. (doing business as "Hudl")
David Graff, who has served on the Company's Board of Directors since 2014, is CEO, co-founder, and a director of Hudl. As of December 31, 2024, the Company and Mr. Dunlap, along with his children, held a combined direct and indirect equity ownership interests in Hudl of approximately 22% and 4%, respectively. In December 2024 and February 2023, the Company purchased stock from existing Hudl shareholders for total consideration of $3.3 million and $31.5 million, respectively. See note 6 for additional information on the 2024 transaction and the Company’s accounting for its investment in Hudl.
The Company makes investments to further diversify the Company both within and outside of its historical core education-related businesses, including investments in real estate. Recent real estate investments have been focused on the development of commercial properties in the Midwest, and particularly in Lincoln, Nebraska, where the Company's headquarters are located. The Company owns 25% of TDP, which is the entity that developed and owns a building in Lincoln's Haymarket District that is the headquarters of Hudl, where Hudl is the primary tenant and Nelnet is a tenant. During 2024, 2023, and 2022, the Company paid Hudl approximately $594,000, $558,000, and $158,000 respectively, to provide lunches for Nelnet’s associates in Hudl’s employee cafeteria and use of certain common area in the building.
Solar Tax Equity Investments
The Company has co-invested in Company-managed limited liability companies with related parties that invest in solar tax equity investment (as summarized below). As part of these transactions, the Company receives management and performance fees under a management agreement.
Entity/RelationshipInvestment amountRevenue recognized by the
Company from management and performance fees (a)
 202420232022202420232022
Union Bank$4,200,568 18,456,829 4,881,063 435,255 152,757 66,568 
F&M— — 3,487,000 148,167 123,077 123,077 
North Central Bancorp, Inc. (directly and indirectly owned by F&M, Mr. Dunlap, and Ms. Muhleisen)787,606 2,212,394 — 94,019 42,769 30,769 
Infovisa, Inc. (directly and indirectly owned by F&M,
Mr. Dunlap, and Ms. Muhleisen)		262,535 737,465 507,781 23,314 12,234 8,369 
Farm and Home Insurance Agency, Inc. (indirectly owned by Mr. Dunlap and Ms. Muhleisen)1,261,305 737,465 — 15,682 7,846 3,846 
(a)    In addition to the co-investments identified above, the related parties in the above table have also invested directly in tax equity solar investments in which are managed by the Company, and the Company receives management and performance fees on such activity. The fees recognized by the Company for these projects are included in the above table.
Stock Repurchase
On November 13, 2023, the Company repurchased, in a privately negotiated transaction under the Company’s existing stock repurchase program, a total of 283,112 shares of the Company’s Class A common stock from certain family members of Mr. Dunlap. The shares were repurchased at a discount to the closing market price of the Company’s Class A common stock as of November 10, 2023, and the transaction was separately approved by the Company’s Board of Directors and its Nominating and Corporate Governance Committee.