LB1344 LB1344
2024 2024
LEGISLATIVE BILL 1344
Approved by the Governor April 16, 2024
Introduced by Wayne, 13.
A BILL FOR AN ACT relating to economic development; to amend sections 13-201,
13-203, 13-204, 13-205, 13-206, 13-207, 13-208, and 81-1201.12, Reissue Revised Statutes of Nebraska, sections 77-908, 77-3806, 81-12,108, and
81-12,112, Revised Statutes Cumulative Supplement, 2022, and sections
77-2715.07, 77-2734.03, 77-4403, 77-4404, 77-4405, 81-12,109, and
81-12,110, Revised Statutes Supplement, 2023; to rename and change provisions of the Creating High Impact Economic Futures Act; to change provisions relating to good life districts, innovation hubs, and inland port districts; to require a report to the Legislature; to define and redefine terms; to harmonize provisions; to provide operative dates; and to repeal the original sections.
Be it enacted by the people of the State of Nebraska,
Section 1. Section 13-201, Reissue Revised Statutes of Nebraska, is amended to read:
13-201 Sections 13-201 to 13-208 shall be known and may be cited as the Creating High Impact Economic Futures Community Development Assistance Act and may also be referred to as the CHIEF Act.
Sec. 2. Section 13-203, Reissue Revised Statutes of Nebraska, is amended to read:
13-203 For purposes of the Creating High Impact Economic Futures Community Development Assistance Act, unless the context otherwise requires:
(1) Accelerator program means a program that (a) provides education and mentorship lasting no more than twenty-four months for early-stage technology companies that have been recruited to a location in this state and (b) has a defined curriculum and mentorship component designed to accelerate a technology company's development and growth;
(2) Agribusiness or agricultural business entity means any person,
partnership, limited partnership, corporation, limited liability company, or other entity engaged in a business that processes raw agricultural products,
including, but not limited to, corn, or that provides value-added functions with regard to raw agricultural products;
(3) Area of chronic economic distress means an area of the state which meets any of the following conditions:
(a) An unemployment rate which exceeds the statewide average unemployment rate;
(b) A per capita income below the statewide average per capita income; or
(c) A population loss between the two most recent federal decennial censuses;
(4) (1) Business firm means shall mean any business entity, including a corporation, a fiduciary, a sole proprietorship, a partnership, a limited liability company, a corporation having an election in effect under Chapter 1,
subchapter S of the Internal Revenue Code, as defined in section 49-801.01,
subject to the state income tax imposed by section 77-2715 or 77-2734.02, an insurance company paying premium or related retaliatory taxes in this state pursuant to section 44-150 or 77-908, or a financial institution paying the tax imposed pursuant to sections 77-3801 to 77-3807;
(5) Community betterment organization means any:
(a) Organization performing eligible activities in a community development area and to which contributions are tax deductible under the provisions of the Internal Revenue Service of the United States Department of the Treasury;
(b) County, city, or village performing eligible activities;
(c) Inland port authority created pursuant to the Municipal Inland Port Authority Act;
(d) Agribusiness or agricultural business entity; or
(e) Organization designated as an iHub under the Nebraska Innovation Hub Act in a community development area;
(2) Community services shall mean any type of the following in a community development area: (a) Employment training; (b) human services; (c) medical services; (d) physical facility and neighborhood development services; (e)
recreational services or activities; (f) educational services; or (g) crime prevention activities, including, but not limited to, (i) the instruction of
any individual in the community development area that enables him or her to
acquire vocational skills, (ii) counseling and advice, (iii) emergency services, (iv) community, youth, day care, and senior citizen centers, (v) in-
home services, (vi) home improvement services and programs, and (vii) any legal enterprise which aids in the prevention or reduction of crime;
(3) Department shall mean the Department of Economic Development;
(4) Director shall mean the Director of Economic Development;
(6) (5) Community development area means shall mean any:
(a) Village village, city, county, unincorporated area of a county, or census tract which has been designated by the department as an area of chronic economic distress;
-1-
LB1344 LB1344
2024 2024
(b) Economic redevelopment area as defined in section 77-6906;
(c) Enterprise zone designated pursuant to the Enterprise Zone Act;
(d) Qualified census tract in Nebraska as defined in 26 U.S.C. 42(d)(5)(B)
(ii)(I), as such section existed on January 1, 2024;
(e) County with a population of less than ten thousand inhabitants; or
(f) Inland port district created pursuant to the Municipal Inland Port Authority Act;
(7) Department means the Department of Economic Development;
(8) Eligible activities include: (a) Employment training; (b) operations of any inland port authority created under the Municipal Inland Port Authority Act; (c) medical services; (d) operation of an agribusiness or agricultural business entity; (e) recreational services or activities, including, but not limited to, operations for a sports complex or sports venue as defined in
section 13-3102; (f) home improvement services and programs; (g) crime prevention activities, including, but not limited to, (i) mental health counseling and advice, (ii) community, youth, and senior citizen centers, and
(iii) any legal enterprise which aids in the prevention or reduction of crime;
(h) construction or operation of intermodal facilities or a shovel-ready site owned by the qualifying organization or by a city or village in this state; (i)
creation or operation of an accelerator program for technology companies; or
(j) operations of an iHub;
(9) Inland port authority has the same meaning as in section 13-3303;
(10) Inland port district has the same meaning as in section 13-3303; and
(11) Innovation hub or iHub has the same meaning as in section 81-12,108.
(6) Community assistance shall mean furnishing financial assistance,
labor, material, or technical advice to aid in the physical improvement of any part or all of a community development area;
(7) Community betterment organization shall mean (a) any organization performing community services or offering community assistance in a community development area and to which contributions are tax deductible under the provisions of the Internal Revenue Service of the United States Department of
the Treasury and (b) a county, city, or village performing community services or offering community assistance in a community development area; and
(8) Area of chronic economic distress shall mean an area of the state which meets any of the following conditions:
(a) An unemployment rate which exceeds the statewide average unemployment rate;
(b) A per capita income below the statewide average per capita income; or
(c) A population loss between the two most recent federal decennial censuses.
Sec. 3. Section 13-204, Reissue Revised Statutes of Nebraska, is amended to read:
13-204 Any community betterment organization which provides eligible activities community assistance or community services in a community development area may apply any time during the fiscal year to the department to
have one or more programs or projects certified for tax credit status as
provided in sections 13-205 to 13-208. The proposal shall set forth the program or project to be conducted, the community development area, the estimated amount to be required for completion of the program or project or the annual estimated amount required for an ongoing program or project, the plans for implementing the program or project, and the amount of contributions committed or anticipated for such activities or services.
Sec. 4. Section 13-205, Reissue Revised Statutes of Nebraska, is amended to read:
13-205 (1) A proposal submitted to the department shall only include all of the following:
(a) A description of the program or project to be conducted, including the eligible activities that will be provided as a result of the program or
project;
(b) A description of the community development area, including the geographical location and boundaries of the community development area;
(c) The estimated amount to be required for completion of the program or
project, including (i) a proposed budget for the program or project with information on personnel and administrative overhead costs, (ii) the amount of
tax credits requested for the year of application, and (iii) the amount of
contributions pledged or anticipated from individuals or business firms eligible for tax credits as well as other sources of funding for the program or
project;
(d) The annual estimated amount required for an ongoing program or
project, including a proposed annual budget with information on personnel and administrative overhead costs, and the amount of tax credits anticipated to be sought in future years;
(e) A description of the community betterment organization's plans and capacity for implementing the program or project and continuing the program or
project;
(f) Documentation that the proposal is supported by the appropriate subdivision of local government, including any letters of support on the proposal provided by such subdivision of local government, and information regarding whether the proposal is consistent with any community development plan that may exist for the area in which the community betterment organization will provide eligible activities; and
(g) If the community betterment organization is recognized by the Internal Revenue Service of the United States Department of the Treasury as an
-2-
LB1344 LB1344
2024 2024
organization to which contributions are tax deductible, documentation of such recognition.
(2) The department shall review all proposals based on the following criteria:
(a) The extent to which the proposed program or project will create or
maintain jobs, provide youth sport participation, stimulate economic development, or provide an economic benefit to the community development area;
(b) A demonstrated capacity and performance of the community betterment organization to execute the proposed program or project;
(c) The involvement of residents and community support of the affected area in the planning of the proposed program or project and the extent to which they will be involved in its implementation;
(d) The extent to which private sector contributions have been committed to the proposed program or project, contingent upon approval of the program or
project by the department; and
(e) Documentation that the proposed program or project is supported by the appropriate subdivision of local government, including any letters of support provided by such subdivision of local government, and information regarding whether the proposed program or project is consistent with any community development plan that may exist for the area in which the community betterment organization will provide eligible activities.
(3) Proposals submitted subsequent to the first year shall be evaluated on
performance of the prior year's program or project, other resources developed,
and continued need.
If the subdivision of local government has adopted a community development plan for an area which includes the area in which the community betterment organization is providing community assistance or community services, the organization shall submit a copy of the program proposal to the chief executive officer of such subdivision. If the program proposal is consistent with the adopted community development plan, the chief executive officer shall so
certify to the department for the department's approval or disapproval. If the program proposal is not consistent with the adopted community development plan of the local subdivision, the chief executive officer shall so indicate and the proposal shall not be approved by the department. If the proposed activities are consistent with the adopted community development plan, but for other reasons they are not viewed as appropriate by the local subdivision, the chief executive officer shall so indicate and the department shall review the program proposal and approve or disapprove it. The local subdivision shall review the proposal within forty-five days from the date of receipt for review. If the subdivision does not issue its finding concerning the proposal within forty-
five days after receipt, the proposal shall be deemed approved. The department shall approve or disapprove a program proposal submitted pursuant to section
13-204 within forty-five days of receipt by the department.
Sec. 5. Section 13-206, Reissue Revised Statutes of Nebraska, is amended to read:
13-206 (1) The director shall adopt and promulgate rules and regulations for the approval or disapproval of the program proposals submitted pursuant to
section 13-205 taking into account the economic need level and the geographic distribution of the population of the community development area. The director shall also adopt and promulgate rules and regulations concerning the amount of
the tax credit for which a program shall be certified. The tax credits provided for in sections 13-205 to 13-208 shall be available for contributions to a certified program or project which may qualify as a charitable contribution deduction on the federal income tax return filed by the business firm or
individual making such contribution. The decision of the department to approve or disapprove all or any portion of a proposal shall be in writing. If the proposal is approved, the maximum tax credit allowance for the certified program shall be stated along with the approval. The maximum tax credit allowance approved by the department shall be final for the fiscal year in
which the program or project is certified. A copy of all decisions shall be
transmitted to the Tax Commissioner. A copy of all credits allowed to business firms under sections 44-150 and 77-908 shall be transmitted to the Director of
Insurance.
(2) For all business firms and individuals eligible for the credit allowed by section 13-207, except for insurance companies paying premium and related retaliatory taxes in this state pursuant to section 44-150 or 77-908, the Tax Commissioner shall provide for the manner in which the credit allowed by
section 13-207 shall be taken and the forms on which such credit shall be
allowed. The Tax Commissioner shall adopt and promulgate rules and regulations for the method of providing tax credits. The Director of Insurance shall provide for the manner in which the credit allowed by section 13-207 to insurance companies paying premium and related retaliatory taxes in this state pursuant to sections 44-150 and 77-908 shall be taken and the forms on which such credit shall be allowed. The Director of Insurance may adopt and promulgate rules and regulations for the method of providing the tax credit.
The Tax Commissioner shall allow against any income tax due from the insurance companies paying premium and related retaliatory taxes in this state pursuant to section 44-150 or 77-908 a credit for the credit provided by section 13-207
and allowed by the Director of Insurance.
(3) The decision of the department to approve or disapprove all or any portion of a proposal or certify a program or project for a designated amount of tax credits shall be provided in writing within forty-five days after receipt of a complete application. If the program or project is approved or
-3-
LB1344 LB1344
2024 2024
certified for a designated amount of tax credits, the department shall prepare and transmit a written agreement to the community betterment organization. The date the written agreement is fully executed by the community betterment organization and the department shall be the date from which contributions may be made to the approved program or project.
(4) Documentation evidencing contributions made to programs or projects certified for tax credit status by the department shall be submitted to the department. The department may request additional documentation as the facts and circumstances may require, or to substantiate the value of the contribution, but documentation shall generally be as follows:
(a) Cash contributions may be shown by a photocopy of both sides of the canceled check or by proof of electronic funds transfer that includes documentation from the bank account of origin and destination. Checks shall be
made payable to the community betterment organization and noted specifically for that program or project, and electronic funds transfers shall be
transferred into the community betterment organization's bank account for the program or project certified for tax credit status by the department;
(b) Real property contributions may be shown by the deed and documentation of at least one independent appraisal of the real property by a real property appraiser credentialed under the Real Property Appraiser Act;
(c) Contributions of equipment or supplies may be shown by copies of
invoices signed by both the contributor and the community betterment organization receiving the equipment or supplies;
(d) Stock contributions shall be converted into cash before the community betterment organization receives the donation. Stock contributions may be shown as cash contributions; and
(e) Other contributions may be shown by affidavit or by other signed statement deemed acceptable by the department that identifies the contribution,
the value of the contribution, and how the value was determined along with other information as may be requested by the department for the particular situation.
(5) The value of eligible contributions made to community betterment org