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--- version:Introduced+++ version:(document, no version)@@ -1,417 +1,29 @@-LEGISLATURE OF NEBRASKA-ONE HUNDRED NINTH LEGISLATURE-SECOND SESSION-LEGISLATIVE BILL 1168+One Hundred Ninth Legislature - Second Session - 2026+Introducer's Statement of Intent+LB1168-Introduced by Wordekemper, 15.-Read first time January 21, 2026+Chairperson: Senator Terrell McKinneyCommittee: Urban Affairs-A BILL FOR AN ACT relating to the Community Development Law; to amend1-sections 18-2124, 18-2125, and 18-2136, Reissue Revised Statutes of2-Nebraska, section 18-2117.01, Revised Statutes Cumulative3-Supplement, 2024, and sections 18-2101.02 and 18-2147, Revised4-Statutes Supplement, 2025; to authorize the issuance of conduit5-revenue bonds as prescribed; to authorize certain taxpayer6-agreements; to harmonize provisions; and to repeal the original7-sections. 8-Be it enacted by the people of the State of Nebraska,9-LB1168-2026-LB1168-2026--1--Section 1. Section 18-2101.02, Revised Statutes Supplement, 2025, is1-amended to read: 2-18-2101.02 (1) For any city that (a) intends to prepare a3-redevelopment plan that will divide ad valorem taxes for a period of more4-than fifteen years but not more than twenty years as provided in5-subdivision (5)(a) (4)(a) of section 18-2147, (b) intends to declare an6-area as an extremely blighted area for purposes of funding decisions7-under subdivision (1)(b) of section 58-708, or (c) intends to declare an8-area as an extremely blighted area in order for individuals purchasing9-residences in such area to qualify for the income tax credit authorized10-in subsection (7) of section 77-2715.07, the governing body of such city11-shall first declare, by resolution adopted after the public hearings12-required under this section, such area to be an extremely blighted area.13-(2) Prior to making such declaration, the governing body of the city14-shall conduct or cause to be conducted a study or an analysis on whether15-the area is extremely blighted and shall submit the question of whether16-such area is extremely blighted to the planning commission or board of17-the city for its review and recommendation. The planning commission or18-board shall hold a public hearing on the question after giving notice of19-the hearing as provided in section 18-2115.01. The planning commission or20-board shall submit its written recommendations to the governing body of21-the city within thirty days after the public hearing.22-(3) Upon receipt of the recommendations of the planning commission23-or board, or if no recommendations are received within thirty days after24-the public hearing required under subsection (2) of this section, the25-governing body shall hold a public hearing on the question of whether the26-area is extremely blighted after giving notice of the hearing as provided27-in section 18-2115.01. At the public hearing, all interested parties28-shall be afforded a reasonable opportunity to express their views29-respecting the proposed declaration. After such hearing, the governing30-body of the city may make its declaration. 31-LB1168-2026-LB1168-2026--2--(4) Copies of each study or analysis conducted pursuant to1-subsection (2) of this section shall be posted on the city's public2-website or made available for public inspection at a location designated3-by the city. 4-(5) The study or analysis required under subsection (2) of this5-section may be conducted in conjunction with the study or analysis6-required under section 18-2109. The hearings required under this section7-may be held in conjunction with the hearings required under section8-18-2109. 9-(6) Notwithstanding any other provisions of the Community10-Development Law, the designation of an area as an extremely blighted area11-pursuant to this section shall be valid for a period of no less than12-twenty-five years from the effective date of the resolution declaring13-such area to be an extremely blighted area, except that such designation14-may be removed prior to the end of such period pursuant to section15-18-2156. 16-Sec. 2. Section 18-2117.01, Revised Statutes Cumulative Supplement,17-2024, is amended to read: 18-18-2117.01 (1)(a) On or before December 1 each year, each city which19-has approved one or more redevelopment plans which are financed in whole20-or in part through the division of taxes as provided in section 18-214721-shall provide a report to the Property Tax Administrator on each such22-redevelopment plan which includes the following information:23-(i) A copy of the redevelopment plan and any amendments thereto,24-including the date upon which the redevelopment plan was approved, the25-effective date for dividing the ad valorem tax as provided to the county26-assessor pursuant to subsection (7) (6) of section 18-2147, and the27-location and boundaries of the property in the redevelopment project; and28-(ii) A short narrative description of the type of development29-undertaken by the city or village with the financing and the type of30-business or commercial activity locating within the redevelopment project31-LB1168-2026-LB1168-2026--3--area as a result of the redevelopment project. 1-(b) If a city has approved one or more redevelopment plans using an2-expedited review under section 18-2155, the city may file a single report3-under this subsection for all such redevelopment plans.4-(2) The report required under subsection (1) of this section must be5-filed each year, regardless of whether the information in the report has6-changed, except that a city is not required to refile a copy of the7-redevelopment plan or an amendment thereto if such copy or amendment has8-previously been filed. 9-(3) The Property Tax Administrator shall compile a report for each10-active redevelopment project, based upon information provided by the11-cities pursuant to subsection (1) of this section and information12-reported by the county assessor or county clerk on the certificate of13-taxes levied pursuant to section 77-1613.01. Each report shall be14-electronically transmitted to the Clerk of the Legislature not later than15-March 1 each year. The report may include any recommendations of the16-Property Tax Administrator as to what other information should be17-included in the report from the cities so as to facilitate analysis of18-the uses, purposes, and effectiveness of tax-increment financing and the19-process for its implementation or to streamline the reporting process20-provided for in this section to eliminate unnecessary paperwork.21-Sec. 3. Section 18-2124, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-18-2124 An authority may issue bonds , including conduit revenue24-bonds subject to a taxpayer agreement entered into pursuant to subsection25-(3) of section 18-2147, from time to time in its discretion for any of26-its corporate purposes, including the payment of principal and interest27-upon any advances for surveys and plans for redevelopment projects. An28-authority may also issue refunding bonds for the purpose of paying,29-retiring, or otherwise refinancing or in exchange for any or all of the30-principal or interest upon bonds previously issued by the authority. An31-LB1168-2026-LB1168-2026--4--authority may issue such types of bonds as it may determine, including,1-without limiting the generality of the foregoing, bonds on which the2-principal and interest are payable: (1) Exclusively from the income,3-proceeds, and revenue of the redevelopment project financed with proceeds4-of such bonds; (2) exclusively from the income, proceeds, and revenue of5-any of its redevelopment projects whether or not they are financed in6-whole or in part with the proceeds of such bonds; (3) exclusively from7-its revenue and income, including any special assessment levied pursuant8-to section 18-1722 and such tax revenue or receipts as may be authorized9-under the Community Development Law, including those which may be pledged10-under section 18-2150, and from such grants and loans as may be received;11-or (4) from all or part of the income, proceeds, and revenue enumerated12-in subdivisions (1), (2), and (3) of this section. Any such bonds may be13-additionally secured by a pledge of any loan, grant, or contributions, or14-parts thereof, from the federal government or other source or a mortgage15-of any redevelopment project or projects of the authority. The authority16-shall not pledge the credit or taxing power of the state or any political17-subdivision thereof, except such tax receipts as may be authorized under18-this section or pledged under section 18-2150, or place any lien or19-encumbrance on any property owned by the state, county, or city used by20-the authority. 21-Sec. 4. Section 18-2125, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-18-2125 Neither the members of an authority nor any person executing24-the bonds shall be liable personally on the bonds by reason of the25-issuance thereof. The bonds and other obligations of the authority, and26-such bonds and obligations shall so state on their face, shall not be a27-debt of the city and the city shall not be liable on such bonds, except28-to the extent authorized by sections 18-2147 to 18-2150, nor in any event29-shall such bonds or obligations be payable out of any funds or properties30-other than those of said authority acquired for the purposes of the31-LB1168-2026-LB1168-2026--5--Community Development Law, except to the extent authorized by sections1-18-2147 to 18-2150. Except to the extent otherwise authorized, the bonds2-shall not constitute an indebtedness within the meaning of any3-constitutional or statutory debt limitation or restriction. Bonds of an4-authority are declared to be issued for an essential public and5-governmental purpose and to be public instrumentalities and, together6-with interest thereon and income therefrom, shall be exempt from all7-Nebraska taxes. All bonds , except conduit revenue bonds issued pursuant8-to subsection (3) of section 18-2147, shall be general obligations of the9-authority issuing same and shall be payable out of any revenue, income,10-receipts, proceeds, or other money of the authority, except as may be11-otherwise provided in the instruments themselves. 12-An authority shall have power from time to time to issue bond13-anticipation notes, referred to as notes herein, and from time to time to14-issue renewal notes, such notes in any case to mature not later than15-thirty months from the date of incurring the indebtedness represented16-thereby in an amount not exceeding in the aggregate at any time17-outstanding the amount of bonds then or theretofore authorized. Payment18-of such notes shall be made from any money or revenue which the authority19-may have available for such purpose or from the proceeds of the sale of20-bonds of the authority, or such notes may be exchanged for a like amount21-of such bonds. The authority may pledge such money or revenue of the22-authority, subject to prior pledges thereof, if any, for the payment of23-such notes, and may in addition secure the notes in the same manner as24-herein provided for bonds. All notes shall be issued and sold in the same25-manner as bonds, and any authority shall have power to make contracts for26-the future sale from time to time of notes on terms and conditions stated27-in such contracts, and the authority shall have power to pay such28-consideration as it shall deem proper for any commitments to purchase29-notes and bonds in the future. Such notes shall also be collaterally30-secured by pledges and deposits with a bank or trust company, in trust31-LB1168-2026-LB1168-2026--6--for the payment of such notes, of bonds in an aggregate amount at least1-equal to the amount of such notes and, in any event, in an amount deemed2-by the issuing authority sufficient to provide for the payment of the3-notes in full at the maturity thereof. The authority may provide in the4-collateral agreement that the notes may be exchanged for bonds held as5-collateral security for the notes, or that the trustee may sell the bonds6-if the notes are not otherwise paid at maturity, and apply the proceeds7-of such sale to the payment of the notes. Such notes shall bear interest8-at a rate set by the authority, and shall be sold at such price as shall9-cause an interest cost thereon not to exceed such rate.10-It is the intention hereof that any pledge of revenue, income,11-receipts, proceeds, or other money made by an authority for the payment12-of bonds or notes shall be valid and binding from the time such pledge is13-made; that the revenue, income, receipts, proceeds, and other money so14-pledged and thereafter received by the authority shall immediately be15-subject to the lien of such pledge without the physical delivery thereof16-or further act, and that the lien of any such pledge shall be valid and17-binding as against all parties having claims of any kind in tort,18-contract, or otherwise against the authority irrespective of whether such19-parties have notice thereof. Neither the resolution nor any other20-instrument by which a pledge is created need be recorded.21-Sec. 5. Section 18-2136, Reissue Revised Statutes of Nebraska, is22-amended to read: 23-18-2136 All property including funds of an authority shall be exempt24-from levy and sale by virtue of an execution, and no execution or other25-judicial process shall issue against such property nor shall judgment26-against an authority be a charge or lien upon its property. The27-provisions of this section shall not apply to or limit the right of28-obligees to foreclose or otherwise enforce any taxpayer agreement entered29-into pursuant to subsection (3) of section 18-2147 or any mortgage of an30-authority or the right of obligees to pursue any remedies for the31-LB1168-2026-LB1168-2026--7--enforcement of any pledge or lien given by an authority on its rents,1-fees, grants, or revenue. 2-Sec. 6. Section 18-2147, Revised Statutes Supplement, 2025, is3-amended to read: 4-18-2147 (1) Any redevelopment plan as originally approved or as5-later modified pursuant to section 18-2117 may contain a provision that6-any ad valorem tax levied upon real property, or any portion thereof, in7-a redevelopment project for the benefit of any public body shall be8-divided, for the applicable period described in subsection (5) (4) of9-this section, as follows: 10-(a) That portion of the ad valorem tax which is produced by the levy11-at the rate fixed each year by or for each such public body upon the12-redevelopment project valuation shall be paid into the funds of each such13-public body in the same proportion as are all other taxes collected by or14-for the body. When there is not a redevelopment project valuation on a15-parcel or parcels, the county assessor shall determine the redevelopment16-project valuation based upon the fair market valuation of the parcel or17-parcels as of January 1 of the year prior to the year that the ad valorem18-taxes are to be divided. The county assessor shall provide written notice19-of the redevelopment project valuation to the authority as defined in20-section 18-2103 and the owner. The authority or owner may protest the21-valuation to the county board of equalization within thirty days after22-the date of the valuation notice. All provisions of section 77-150223-except dates for filing of a protest, the period for hearing protests,24-and the date for mailing notice of the county board of equalization's25-decision are applicable to any protest filed pursuant to this section.26-The county board of equalization shall decide any protest filed pursuant27-to this section within thirty days after the filing of the protest. The28-county clerk shall mail a copy of the decision made by the county board29-of equalization on protests pursuant to this section to the authority or30-owner within seven days after the board's decision. Any decision of the31-LB1168-2026-LB1168-2026--8--county board of equalization may be appealed to the Tax Equalization and1-Review Commission, in accordance with section 77-5013, within thirty days2-after the date of the decision; 3-(b) That portion of the ad valorem tax on real property, as provided4-in the redevelopment contract, bond resolution, or redevelopment plan, as5-applicable, in the redevelopment project in excess of such amount, if6-any, shall be allocated to and, when collected, paid into a special fund7-of the authority to be used solely to pay the principal of, the interest8-on, and any premiums due in connection with the bonds of, loans, notes,9-or advances of money to, or indebtedness incurred by, whether funded,10-refunded, assumed, or otherwise, such authority for financing or11-refinancing, in whole or in part, the redevelopment project. When such12-bonds, loans, notes, advances of money, or indebtedness, including13-interest and premiums due, have been paid, the authority shall so notify14-the county assessor and county treasurer and all ad valorem taxes upon15-taxable real property in such a redevelopment project shall be paid into16-the funds of the respective public bodies. An authority may use a single17-fund for purposes of this subdivision for all redevelopment projects or18-may use a separate fund for each redevelopment project; and19-(c) Any interest and penalties due for delinquent taxes shall be20-paid into the funds of each public body in the same proportion as are all21-other taxes collected by or for the public body. 22-(2) To the extent that a redevelopment plan authorizes the division23-of ad valorem taxes levied upon only a portion of the real property24-included in such redevelopment plan, any improvements funded by such25-division of taxes shall be related to the redevelopment plan that26-authorized such division of taxes. 27-(3)(a) An authority may enter into a redevelopment contract or adopt28-a bond resolution or redevelopment plan pursuant to which it issues29-conduit revenue bonds and under which the authority may pledge a30-percentage, up to and including one hundred percent, of the annual excess31-LB1168-2026-LB1168-2026--9--tax revenues described in subdivision (1)(b) of this section, if any,1-toward the authority's obligations under the contract, resolution, or2-plan. The ad valorem taxes to be pledged under this subsection shall be3-placed into a special fund of the authority to be used solely to pay the4-principal of, the interest on, and any premiums due in connection with5-the bonds of the redevelopment project. When an authority has pledged6-less than one hundred percent of the excess tax revenues under the7-contract, resolution, or plan, the unpledged portion of ad valorem taxes8-collected on the real property shall be paid into the funds of the9-respective public bodies as provided in subdivision (1)(b) of this10-section. 11-(b) An authority that issues one or more conduit revenue bonds12-pursuant to subdivision (3)(a) of this section may enter into an13-agreement with a taxpayer that limits the taxpayer's rights to challenge14-the assessment of real property taxes on real property within a15-redevelopment project or that guarantees, enhances, or otherwise further16-secures bonds issued by the authority, such as by guaranteeing any17-shortfall in real property taxes pledged to payment of the conduit18-revenue bonds issued to support a redevelopment project, if (i) the19-taxpayer's real property is within such redevelopment project and (ii)20-the real property taxes levied upon such real property are subject to21-division in accordance with subdivision (3)(a) of this section. The22-obligation to make payments under a taxpayer agreement that guarantee,23-enhance, or otherwise further secure conduit revenue bonds issued24-pursuant to subdivision (3)(a) of this section shall be treated in the25-same manner as property taxes for purposes of section 77-203 if, and to26-the extent that, the taxpayer agreement provides for a property tax lien.27-(c) A lien resulting from a taxpayer agreement described in28-subdivision (3)(b) of this section takes priority over any existing or29-subsequent mortgage, other lien, or other encumbrance on the property,30-shall have parity with a property tax lien described in section 77-203,31-LB1168-2026-LB1168-2026--10--and may be enforced and collected in all respects as real property taxes.1-(4)(a) (3)(a) For any redevelopment plan located in a city of the2-metropolitan class that includes a division of taxes, as provided in this3-section, that produces, in whole or in part, funds to be used directly or4-indirectly for (i) new construction, rehabilitation, or acquisition of5-housing for households with annual incomes below the area median income6-for households and located within six hundred yards of a public passenger7-streetcar or (ii) new construction, rehabilitation, or acquisition of8-single-family housing or condominium housing used as primary residences9-for individuals with annual incomes below the area median income for10-individuals, such housing shall be deemed related to the redevelopment11-plan that authorized such division of taxes regardless of whether such12-housing is or will be located on real property within such redevelopment13-plan, as long as such housing supports activities occurring on or14-identified in such redevelopment plan. 15-(b) During each fiscal year in which the funds described in16-subdivision (a) of this subsection are available, the authority and city17-shall make best efforts to allocate not less than thirty percent of such18-funds to single-family housing deemed related to the redevelopment plan19-described under such subdivision. 20-(c) In selecting projects to receive funding, the authority and city21-shall develop a qualified allocation plan and give first priority to22-financially viable projects that serve the lowest income occupants for23-the longest period of time. 24-(5)(a) (4)(a) For any redevelopment plan for which more than fifty25-percent of the property in the redevelopment project area has been26-declared an extremely blighted area in accordance with section27-18-2101.02, ad valorem taxes shall be divided for a period not to exceed28-twenty years after the effective date as identified in the project29-redevelopment contract or in the resolution of the authority authorizing30-the issuance of bonds pursuant to section 18-2124.31-LB1168-2026-LB1168-2026--11--(b) For all other redevelopment plans, ad valorem taxes shall be1-divided for a period not to exceed fifteen years after the effective date2-as identified in the project redevelopment contract, in the resolution of3-the authority authorizing the issuance of bonds pursuant to section4-18-2124, or in the redevelopment plan, whichever is applicable.5-(6) (5) The effective date of a provision dividing ad valorem taxes6-as provided in subsection (5) (4) of this section shall not occur until7-such time as the real property in the redevelopment project is within the8-corporate boundaries of the city. This subsection shall not apply to a9-redevelopment project involving a formerly used defense site as10-authorized in section 18-2123.01. 11-(7) (6) All notices of the provision for dividing ad valorem taxes12-shall be sent by the authority to the county assessor on forms prescribed13-by the Property Tax Administrator. The notice shall be sent to the county14-assessor on or before July 1 of the year of the effective date of the15-provision. Failure to satisfy the notice requirement of this section16-shall result in the taxes, for all taxable years affected by the failure17-to give notice of the effective date of the provision, remaining18-undivided and being paid into the funds for each public body receiving19-property taxes generated by the property in the redevelopment project.20-However, the redevelopment project valuation for the remaining division21-of ad valorem taxes in accordance with subdivisions (1)(a) and (b) of22-this section shall be the last certified valuation for the taxable year23-prior to the effective date of the provision to divide the taxes for the24-remaining portion of the twenty-year or fifteen-year period pursuant to25-subsection (5) (4) of this section. 26-Sec. 7. Original sections 18-2124, 18-2125, and 18-2136, Reissue27-Revised Statutes of Nebraska, section 18-2117.01, Revised Statutes28-Cumulative Supplement, 2024, and sections 18-2101.02 and 18-2147, Revised29-Statutes Supplement, 2025, are repealed. 30-LB1168-2026-LB1168-2026--12-++The following constitutes the reasons for this bill and the purposes which are sought to be+accomplished thereby:+The intent of LB1168 is to amend the Community Development Act to authorize community+development agencies and community redevelopment agencies (authorities) seeking to utilize+tax increment financing the option to (1) issue conduit revenue bonds on behalf of a private+investor under which the authority’s liability for repayment is limited to the ad valorem+taxes actually generated by the project area; (2) to negotiate with that private investor the+percentage of ad valorem taxes pledged toward bond repayment; (3) to require that any+percentage of ad valorem taxes not pledged toward bond repayment be disbursed by the+County Treasurer in accordance with the levy applicable to the project area; and (4) to+enter into taxpayer agreements with owners of land in the project area (often the developer)+under which the landowner(s) would agree that any shortfall between the amount necessary+to meet the conduit bond borrower’s annual obligations to the bond lender and the amount+of pledged ad valorem taxes generated by the project area would become the obligation+of the taxpayer(s) owning the land, such obligation to run with the land and to be treated+and prioritized as a tax lien on the land, enforceable under section 77-203. The intent of+a taxpayer agreement is to serve as a guarantee of bond obligations in addition to the ad+valorem taxes pledged by the authority.++Principal Introducer: ________________________________+Senator Dave Wordekemper+- 1 -
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