LB454 LB454
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LEGISLATURE OF NEBRASKA
ONE HUNDRED SEVENTH LEGISLATURE
FIRST SESSION
LEGISLATIVE BILL 454
Introduced by Friesen, 34.
Read first time January 15, 2021
Committee: Revenue
1 A BILL FOR AN ACT relating to revenue and taxation; to amend sections
2 77-201 and 77-5023, Reissue Revised Statutes of Nebraska, and
3 sections 79-1016 and 79-1018.01, Revised Statutes Cumulative
4 Supplement, 2020; to adopt the School Property Tax Stabilization
5 Act; to change the valuation of agricultural land and horticultural
6 land as prescribed; to harmonize provisions; to provide operative
7 dates; and to repeal the original sections.
8 Be it enacted by the people of the State of Nebraska,
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1 Section 1. Sections 1 to 4 of this act shall be known and may be
2 cited as the School Property Tax Stabilization Act.
3 Sec. 2. (1) On or before September 15, 2021, the State Department
4 of Education shall determine the total school property tax stabilization
5 payment to be paid to each eligible school district for the 2021-22
6 school fiscal year. On or before June 30, 2022, and on or before June 30
7 of each year thereafter, the State Department of Education shall
8 determine the total school property tax stabilization payment to be paid
9 to each eligible school district for the ensuing school fiscal year.
10 (2) A school district is eligible for a school property tax
11 stabilization payment if the school district property tax requirement
12 exceeds seventy percent of the formula need calculated for such school
13 district for the school fiscal year for which a total school property tax
14 stabilization payment is being calculated.
15 (3) The school district property tax requirement for each school
16 district shall equal the formula need calculated pursuant to section
17 79-1007.11 minus the sum of the amount to be distributed pursuant to the
18 Tax Equity and Educational Opportunities Support Act as certified
19 pursuant to section 79-1022 and other actual receipts as determined
20 pursuant to section 79-1018.01 for such school district for the school
21 fiscal year for which a total school property tax stabilization payment
22 is being calculated.
23 (4) The school property tax stabilization base for an eligible
24 school district shall equal the amount by which the school district
25 property tax requirement exceeds the difference of seventy percent of the
26 formula need minus the sum of the amount to be distributed pursuant to
27 the Tax Equity and Educational Opportunities Support Act and other actual
28 receipts for such school district.
29 (5) The total school property tax stabilization payment to be paid
30 to an eligible school district shall equal the school property tax
31 stabilization base for such school district multiplied by fifty percent.
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1 Sec. 3. The total school property tax stabilization payment
2 calculated pursuant to section 2 of this act for each eligible school
3 district shall be certified to the Director of Administrative Services,
4 the Auditor of Public Accounts, and each school district. The amounts
5 certified pursuant to this section shall be divided and distributed in
6 ten as nearly as possible equal monthly school property tax stabilization
7 payments on the last business day of each month beginning in September of
8 the school fiscal year for which such school property tax stabilization
9 payments were certified and ending in June of such school fiscal year,
10 except that a school district that would receive monthly school property
11 tax stabilization payments of less than one thousand dollars shall
12 receive the total school property tax stabilization payment on the last
13 business day of December during such school fiscal year.
14 Sec. 4. It is the intent of the Legislature to appropriate the
15 amount necessary to carry out the School Property Tax Stabilization Act
16 for each school fiscal year.
17 Sec. 5. Section 77-201, Reissue Revised Statutes of Nebraska, is
18 amended to read:
19 77-201 (1) Except as provided in subsections (2) through (4) of this
20 section, all real property in this state, not expressly exempt therefrom,
21 shall be subject to taxation and shall be valued at its actual value.
22 (2) Agricultural land and horticultural land as defined in section
23 77-1359 shall constitute a separate and distinct class of property for
24 purposes of property taxation, shall be subject to taxation, unless
25 expressly exempt from taxation, and shall be valued at seventy-five
26 percent of its actual value, except that for school district taxation
27 purposes, such land shall be valued at a percentage of its actual value
28 as determined from the table in subsection (6) of this section.
29 (3) Agricultural land and horticultural land actively devoted to
30 agricultural or horticultural purposes which has value for purposes other
31 than agricultural or horticultural uses and which meets the
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1 qualifications for special valuation under section 77-1344 shall
2 constitute a separate and distinct class of property for purposes of
3 property taxation, shall be subject to taxation, and shall be valued for
4 taxation at seventy-five percent of its special valuation value as
5 defined in section 77-1343, except that for school district taxation
6 purposes, such land shall be valued at a percentage of its special
7 valuation as determined from the table in subsection (6) of this section.
8 (4) Historically significant real property which meets the
9 qualifications for historic rehabilitation valuation under sections
10 77-1385 to 77-1394 shall be valued for taxation as provided in such
11 sections.
12 (5) Tangible personal property, not including motor vehicles,
13 trailers, and semitrailers registered for operation on the highways of
14 this state, shall constitute a separate and distinct class of property
15 for purposes of property taxation, shall be subject to taxation, unless
16 expressly exempt from taxation, and shall be valued at its net book
17 value. Tangible personal property transferred as a gift or devise or as
18 part of a transaction which is not a purchase shall be subject to
19 taxation based upon the date the property was acquired by the previous
20 owner and at the previous owner's Nebraska adjusted basis. Tangible
21 personal property acquired as replacement property for converted property
22 shall be subject to taxation based upon the date the converted property
23 was acquired and at the Nebraska adjusted basis of the converted property
24 unless insurance proceeds are payable by reason of the conversion. For
25 purposes of this subsection, (a) converted property means tangible
26 personal property which is compulsorily or involuntarily converted as a
27 result of its destruction in whole or in part, theft, seizure,
28 requisition, or condemnation, or the threat or imminence thereof, and no
29 gain or loss is recognized for federal or state income tax purposes by
30 the holder of the property as a result of the conversion and (b)
31 replacement property means tangible personal property acquired within two
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1 years after the close of the calendar year in which tangible personal
2 property was converted and which is, except for date of construction or
3 manufacture, substantially the same as the converted property.
4 (6) The applicable percentage to be used for school district
5 taxation purposes under subsections (2) and (3) of this section shall be
6 determined from the following table:
7 Tax Year Percentage
8 2022 65
9 2023 and after 55
10 (7) For purposes of this section, school district taxation means
11 property taxes levied on real or personal property by any school district
12 or multiple-district school system, excluding property taxes levied to
13 pay the principal and interest on bonds issued by the school district or
14 multiple-district school system.
15 Sec. 6. Section 77-5023, Reissue Revised Statutes of Nebraska, is
16 amended to read:
17 77-5023 (1) Pursuant to section 77-5022, the commission shall have
18 the power to increase or decrease the value of a class or subclass of
19 real property in any county or taxing authority or of real property
20 valued by the state so that all classes or subclasses of real property in
21 all counties fall within an acceptable range.
22 (2) An acceptable range is the percentage of variation from a
23 standard for valuation as measured by an established indicator of central
24 tendency of assessment. Acceptable ranges are: (a) For agricultural land
25 and horticultural land as defined in section 77-1359, sixty-nine to
26 seventy-five percent of actual value, except that for school district
27 taxation purposes, the acceptable range is a percentage range of actual
28 value as determined pursuant to subsection (6) of this section; (b) for
29 lands receiving special valuation, sixty-nine to seventy-five percent of
30 special valuation as defined in section 77-1343, except that for school
31 district taxation purposes, the acceptable range is a percentage range of
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1 special valuation as determined pursuant to subsection (6) of this
2 section; and (c) for all other real property, ninety-two to one hundred
3 percent of actual value.
4 (3) Any increase or decrease shall cause the level of value
5 determined by the commission to be at the midpoint of the applicable
6 acceptable range.
7 (4) Any decrease or increase to a subclass of property shall also
8 cause the level of value determined by the commission for the class from
9 which the subclass is drawn to be within the applicable acceptable range.
10 (5) Whether or not the level of value determined by the commission
11 falls within an acceptable range or at the midpoint of an acceptable
12 range may be determined to a reasonable degree of certainty relying upon
13 generally accepted mass appraisal techniques.
14 (6) The applicable percentage range to be used for school district
15 taxation purposes under subdivisions (2)(a) and (b) of this section shall
16 be determined from the following table:
17 Tax Year Percentage Range
18 2022 59 to 65
19 2023 and after 49 to 55
20 (7) For purposes of this section, school district taxation means
21 property taxes levied on real or personal property by any school district
22 or multiple-district school system, excluding property taxes levied to
23 pay the principal and interest on bonds issued by the school district or
24 multiple-district school system.
25 Sec. 7. Section 79-1016, Revised Statutes Cumulative Supplement,
26 2020, is amended to read:
27 79-1016 (1) On or before August 20, the county assessor shall
28 certify to the Property Tax Administrator the total taxable value by
29 school district in the county for the current assessment year on forms
30 prescribed by the Tax Commissioner. The county assessor may amend the
31 filing for changes made to the taxable valuation of the school district
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1 in the county if corrections or errors on the original certification are
2 discovered. Amendments shall be certified to the Property Tax
3 Administrator on or before August 31.
4 (2) On or before October 10, the Property Tax Administrator shall
5 compute and certify to the State Department of Education the adjusted
6 valuation for the current assessment year for each class of property in
7 each school district and each local system. The adjusted valuation of
8 property for each school district and each local system, for purposes of
9 determining state aid pursuant to the Tax Equity and Educational
10 Opportunities Support Act, shall reflect as nearly as possible state aid
11 value as defined in subsection (3) of this section. The Property Tax
12 Administrator shall notify each school district and each local system of
13 its adjusted valuation for the current assessment year by class of
14 property on or before October 10. Establishment of the adjusted valuation
15 shall be based on the taxable value certified by the county assessor for
16 each school district in the county adjusted by the determination of the
17 level of value for each school district from an analysis of the
18 comprehensive assessment ratio study or other studies developed by the
19 Property Tax Administrator, in compliance with professionally accepted
20 mass appraisal techniques, as required by section 77-1327. The Tax
21 Commissioner shall adopt and promulgate rules and regulations setting
22 forth standards for the determination of level of value for state aid
23 purposes.
24 (3) For purposes of this section, state aid value means:
25 (a) For real property other than agricultural and horticultural
26 land, ninety-six percent of actual value;
27 (b) For agricultural and horticultural land: ,
28 (i) For the adjusted valuation used for the calculation of aid for
29 school fiscal years prior to school fiscal year 2022-23, seventy-two
30 percent of actual value as provided in sections 77-1359 and to 77-1363;
31 (ii) For the adjusted valuation used for the calculation of aid for
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1 school fiscal year 2022-23, sixty-two percent of actual value as provided
2 in sections 77-1359 and 77-1363; and
3 (iii) For the adjusted valuation used for the calculation of aid for
4 school fiscal year 2023-24 and each school fiscal year thereafter, fifty-
5 two percent of actual value as provided in sections 77-1359 and 77-1363;
6 (c) . For agricultural and horticultural land that receives special
7 valuation pursuant to section 77-1344: ,
8 (i) For the adjusted valuation used for the calculation of aid for
9 school fiscal years prior to school fiscal year 2022-23, seventy-two
10 percent of special valuation as defined in section 77-1343;
11 (ii) For the adjusted valuation used for the calculation of aid for
12 school fiscal year 2022-23, sixty-two percent of special valuation as
13 defined in section 77-1343; and
14 (iii) For the adjusted valuation used for the calculation of aid for
15 school fiscal year 2023-24 and each school fiscal year thereafter, fifty-
16 two percent of special valuation as defined in section 77-1343; and
17 (d) (c) For personal property, the net book value as defined in
18 section 77-120.
19 (4) On or before November 10, any local system may file with the Tax
20 Commissioner written objections to the adjusted valuations prepared by
21 the Property Tax Admini