LB80 LB80
2024 2024
LEGISLATURE OF NEBRASKA
ONE HUNDRED EIGHTH LEGISLATURE
FIRST SPECIAL SESSION
LEGISLATIVE BILL 80
Introduced by Raybould, 28.
Read first time July 29, 2024
Committee: Revenue
1 A BILL FOR AN ACT relating to revenue and taxation; to amend sections
2 13-508, 13-518, 13-2817, 14-109, 15-202, 15-203, 16-205, 17-525,
3 29-3933, 72-2305, 72-2306, 77-1315, and 77-27,142, Reissue Revised
4 Statutes of Nebraska; sections 77-1630, 77-1776, and 77-27,144,
5 Revised Statutes Cumulative Supplement, 2022; section 77-1701,
6 Revised Statutes Supplement, 2023; and section 18-1208, Reissue
7 Revised Statutes of Nebraska, as amended by Laws 2024, LB1317,
8 section 55; to adopt the Property Tax Growth Limitation Act; to
9 provide for an ad valorem adjustment relating to tax-increment
10 financing; to change provisions relating to budget limitations,
11 municipal occupation taxes, property tax notices, and property tax
12 statements; to terminate the Property Tax Request Act; to harmonize
13 provisions; and to repeal the original sections.
14 Be it enacted by the people of the State of Nebraska,
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1 Section 1. Sections 1 to 8 of this act shall be known and may be
2 cited as the Property Tax Growth Limitation Act.
3 Sec. 2. For purposes of the Property Tax Growth Limitation Act:
4 (1) Approved bonds means bonds as defined in subdivision (1) of
5 section 10-134 that are approved according to law, excluding any bonds
6 issued to finance a project or projects if the issuance of bonds for such
7 project or projects was the subject of a general obligation bond election
8 held at the most recent regularly scheduled election and was not approved
9 at such election;
10 (2) Auditor means the Auditor of Public Accounts;
11 (3) Consumer price index means the Consumer Price Index for All
12 Urban Consumers published by the federal Bureau of Labor Statistics;
13 (4) Emergency means an emergency, as defined in section 81-829.39,
14 for which a state of emergency proclamation or local state of emergency
15 proclamation has been issued under the Emergency Management Act;
16 (5) Growth percentage means the percentage obtained by dividing (a)
17 the political subdivision's growth value by (b) the political
18 subdivision's total property valuation from the prior year;
19 (6) Growth value means the increase in a political subdivision's
20 total property valuation, including any increase to the valuation of any
21 tax increment financing project located in the political subdivision,
22 from the prior year to the current year due to (a) improvements to real
23 property as a result of new construction and additions to existing
24 buildings, (b) any other improvements to real property which increase the
25 value of such property, (c) annexation of real property by the political
26 subdivision, (d) a change in the use of real property, and (e) any
27 increase in personal property valuation over the prior year;
28 (7) Political subdivision means any county, city, or village;
29 (8) Property tax request means the total amount of property taxes
30 requested to be raised for a political subdivision through the levy
31 imposed pursuant to section 77-1601;
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1 (9) Property tax request authority means the amount that may be
2 included in a political subdivision's property tax request as determined
3 pursuant to the Property Tax Growth Limitation Act;
4 (10) Public safety expenses means expenses incurred by a political
5 subdivision for the well-being and protection of the general public;
6 (11) State aid means:
7 (a) For all political subdivisions, state aid paid pursuant to
8 sections 60-3,202 and 77-3523 and reimbursement provided pursuant to
9 section 77-1239;
10 (b) For cities and villages, state aid to cities and villages paid
11 pursuant to sections 39-2501 to 39-2520, 60-3,190, and 77-27,139.04 and
12 insurance premium tax paid to cities and villages; and
13 (c) For counties, state aid to counties paid pursuant to sections
14 60-3,184 to 60-3,190, insurance premium tax paid to counties, and
15 reimbursements to counties from funds appropriated pursuant to section
16 29-3933; and
17 (12) Tax increment financing project means a redevelopment project
18 as defined in section 18-2103 that is financed through the division of
19 taxes as provided in section 18-2147.
20 Sec. 3. (1) Except as otherwise provided in the Property Tax Growth
21 Limitation Act, for fiscal years beginning on or after July 1, 2025, a
22 political subdivision's property tax request for any year shall not
23 exceed its property tax request authority as determined under this
24 section. The preliminary property tax request authority for each
25 political subdivision shall be the amount of property taxes levied by the
26 county board of equalization pursuant to section 77-1601 for such
27 political subdivision in the prior fiscal year.
28 (2) In addition to the preliminary property tax request authority,
29 the political subdivision's property tax request authority may be
30 increased by the product of:
31 (a) The amount of property taxes levied in the prior year increased
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1 by the political subdivision's growth percentage, less the sum of
2 exceptions utilized in the prior year pursuant to subdivisions (1), (4),
3 and (6) of section 4 of this act; and
4 (b) The greater of five percent or the percentage change in the
5 consumer price index over the most recently completed calendar year.
6 Sec. 4. A political subdivision may increase its property tax
7 request authority over the amount determined under section 3 of this act
8 by:
9 (1) The amount of property taxes budgeted for approved bonds;
10 (2) The amount of property taxes budgeted for capital improvements;
11 (3) The amount of property taxes budgeted in support of a service
12 which is the subject of an agreement or a modification of an existing
13 agreement whether operated by one of the parties to the agreement or by
14 an independent joint entity or joint public agency;
15 (4) The amount of property taxes needed to respond to an emergency
16 declared in the preceding year, as certified to the auditor;
17 (5) The amount of unused property tax request authority determined
18 in accordance with section 6 of this act;
19 (6) The amount of property taxes budgeted for public safety
20 expenses;
21 (7) The increase in property tax request authority approved by the
22 legal voters as provided in section 5 of this act; and
23 (8) The amount of property taxes needed to replace any revenue
24 stream collected in the prior year that was eliminated or reduced through
25 legislative action.
26 Sec. 5. (1) A political subdivision may increase its property tax
27 request authority over the amount determined under section 3 of this act
28 if such increase is approved by a majority of legal voters voting on the
29 issue at an election described in subsection (2) of this section. Such
30 issue shall be placed on the ballot (a) upon the recommendation of the
31 governing body of such political subdivision or (b) upon the receipt by
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1 the county clerk or election commissioner of a petition requesting such
2 issue to be placed on the ballot which is signed by at least five percent
3 of the legal voters of the political subdivision. The recommendation of
4 the governing body or the petition of the legal voters shall include the
5 amount by which the political subdivision would increase its property tax
6 request authority over and above the amount determined under section 3 of
7 this act.
8 (2) Upon receipt of such recommendation or legal voter petition, the
9 county clerk or election commissioner shall place such issue on the
10 ballot at the next regularly scheduled election. The election shall be
11 held pursuant to the Election Act, and all costs shall be paid by the
12 political subdivision. The issue may be approved on the same question as
13 a vote to exceed the levy limits provided in section 77-3444. If a
14 majority of the votes cast on the issue are in favor of increasing the
15 political subdivision's property tax request authority, the political
16 subdivision shall be empowered to do so.
17 Sec. 6. A political subdivision may choose not to increase its
18 total property taxes levied by the full amount of the property tax
19 request authority allowed in a particular year. In such cases, the
20 political subdivision may carry forward to future budget years the amount
21 of unused property tax request authority, but accumulation of unused
22 property tax request authority shall not exceed an aggregate of five
23 percent of the total property tax request authority from the prior year.
24 Sec. 7. The auditor shall prepare forms to be used by political
25 subdivisions for the purpose of calculating property tax request
26 authority and unused property tax request authority. Each political
27 subdivision shall calculate such amounts and submit the forms to the
28 auditor on or before September 30, 2025, and on or before September 30 of
29 each year thereafter. If a political subdivision fails to submit such
30 forms to the auditor or if the auditor determines from such forms that a
31 political subdivision is not complying with the limits provided in the
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1 Property Tax Growth Limitation Act, the auditor shall notify the
2 political subdivision and the State Treasurer of the noncompliance. The
3 State Treasurer shall then suspend distribution of state aid allocated to
4 the political subdivision until the political subdivision complies. The
5 funds shall be held for six months. If the political subdivision complies
6 within the six-month period, it shall receive the suspended funds. If the
7 political subdivision fails to comply within the six-month period, the
8 suspended funds shall be forfeited and shall be redistributed to other
9 recipients of the state aid or, in the case of homestead exemption
10 reimbursement, returned to the General Fund.
11 Sec. 8. The auditor may adopt and promulgate rules and regulations
12 to carry out the Property Tax Growth Limitation Act.
13 Sec. 9. (1) For purposes of this section:
14 (a) Ad valorem adjustment means an amount equal to the portion of
15 the property taxes that would be produced by the applicable school
16 district levy rate in 2024 imposed upon the excess valuation, less the
17 amount of actual property taxes generated by the school district levy
18 rate in the current year on the excess valuation;
19 (b) Authority has the same meaning as in section 18-2103;
20 (c) Excess valuation means the amount of valuation of the real
21 property in a redevelopment project in excess of the redevelopment
22 project valuation for such real property;
23 (d) Redevelopment project has the same meaning as in section
24 18-2103; and
25 (e) Redevelopment project valuation has the same meaning as in
26 section 18-2103.
27 (2) Notwithstanding anything to the contrary contained in any
28 legislation enacted during the One Hundred Eighth Legislature, First
29 Special Session, that creates, establishes, increases, or otherwise
30 provides state funding for school districts and which has the effect,
31 directly or indirectly, of reducing the property tax levy rates of school
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1 districts, the amount paid to each such school district from such state
2 funding source shall be reduced by an amount equal to the ad valorem
3 adjustment applicable to such school district. The ad valorem adjustment
4 shall instead be remitted to the authority to which such property taxes
5 are payable pursuant to section 18-2147.
6 Sec. 10. Section 13-508, Reissue Revised Statutes of Nebraska, is
7 amended to read:
8 13-508 (1) After publication and hearing thereon and within the time
9 prescribed by law, each governing body shall file with and certify to the
10 levying board or boards on or before September 30 of each year or
11 September 30 of the final year of a biennial period and file with the
12 auditor a copy of the adopted budget statement which complies with
13 sections 13-518 to 13-522 or 79-1023 to 79-1030, if applicable, together
14 with the amount of the tax required to fund the adopted budget, setting
15 out separately (a) the amount to be levied for the payment of principal
16 or interest on bonds issued or authorized to be issued by the governing
17 body or the legal voters of the political subdivision and (b) the amount
18 to be levied for all other purposes. Proof of publication shall be
19 attached to the statements. For fiscal years prior to fiscal year
20 2017-18, learning communities shall also file a copy of such adopted
21 budget statement with member school districts on or before September 1 of
22 each year. If the prime rate published by the Federal Reserve Board is
23 ten percent or more at the time of the filing and certification required
24 under this subsection, the governing body, in certifying the amount
25 required, may make allowance for delinquent taxes not exceeding five
26 percent of the amount required plus the actual percentage of delinquent
27 taxes for the preceding tax year or biennial period and for the amount of
28 estimated tax loss from any pending or anticipated litigation which
29 involves taxation and in which tax collections have been or can be
30 withheld or escrowed by court order. For purposes of this section,
31 anticipated litigation shall be limited to the anticipation of an action
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1 being filed by a taxpayer who or which filed a similar action for the
2 preceding year or biennial period which is still pending. Except for such
3 allowances, a governing body shall not certify an amount of tax more than
4 one percent greater or lesser than the amount determined under section
5 13-505.
6 (2) Each governing body shall use the certified taxable values as
7 provided by the county assessor pursuant to section 13-509 for the
8 current year in setting or certifying the levy. Each governing body may
9 designate one of its members to perform any duty or responsibility
10 required of such body by this section.
11 Sec. 11. Section 13-518, Reissue Revised Statutes of Nebraska, is
12 amended to read:
13 13-518 For purposes of sections 13-518 to 13-522:
14 (1) Allowable growth means (a) for governmental units other than
15 community colleges, the percentage increase in taxable valuation in
16 excess of the base limitation established under section 77-3446, if any,
17 due to improvements to real property as a result of new construction,
18 additions to existing buildings, any improvements to real property which
19 increase the value of such property, and any increase in valuation due to
20 annexation and any personal property valuation over the p