105th Nebraska Legislature, Second Session, Adjourns Sine Die
The Nebraska Legislature adjourned sine die on April 18, 2018. The Legislature considered 1,136 bills during the 2017-2018 Biennium. At the conclusion of bill introduction, we identified 20 bills warranting particular diligence. Summaries of these bills are available here.
Below we describe the final disposition of those bills, in addition to notable carry-over bills from the First Session of the Biennium. Because this legislative session is the second year in the Biennium, any bills that did not pass will automatically terminate and will not carry over into the 106th Legislative Session. The 106th Legislature will convene on January 2, 2019.
TAX INCREMENT FINANCING
The Legislature took significant action on tax-increment financing (“TIF”) in 2018 for the first time in many years. LB 874 enacts a number of significant changes to Nebraska’s Community Development Law. Key changes include:
- Requiring public hearings for all blight and substandard determinations made by the planning commission and governing body. Further, all notices for public hearings on blight and substandard determinations must include a map of the affected area (or reference to where such a map may be found). As a whole, LB 874 provides additional structure to the governing body’s designation of blighted and substandard areas.
- Making the Community Development Law more reader-friendly by alphabetizing all definitions and consolidating all notice provisions into one section.
- Emphasizing oversight and transparency in relation to the redevelopment approval process. For example, the bill allows for discretionary audits of a redevelopment authority or redevelopment plan by the state auditor at the expense of the redevelopment authority, and requires the results from such audits be publically available. Additionally, the bill requires the governing body make publically available all blighted and substandard studies and all cost-benefit analyses; requires notice to all relevant taxing jurisdictions for each public hearing held by the governing body or planning commission with respect to all determinations made during the community redevelopment process; requires written findings of the governing body’s but-for analysis (i.e., that the redevelopment project would not be economically feasible without the use of TIF); requires provision of a map (or reference to where such a map may be found) of the redevelopment area in all notices of the governing body or planning commission related to adoption or substantial modification of a redevelopment plan; requires an annual report by the governing body on active TIF projects; requires the governing body and redeveloper retain, for the duration of the TIF period plus three years, all documentation actually generated and received in relation to a redevelopment project; and requires notice from the county treasurer to each affected taxpayer of the allocation of property taxes between a TIF-eligible redevelopment project and other taxing jurisdictions within the area.
- Eliminating revolving loan funds for TIF proceeds; providing a registration process for neighborhood associations wishing to receive notice of any public hearings during the community redevelopment process; requiring the redevelopment authority consider the impact on student populations of school districts as part of its cost-benefit analysis for each redevelopment project; providing for the reimbursement of enumerated TIF-eligible costs incurred prior to the governing body’s approval of a redevelopment plan; and requiring that all TIF proceeds intended to fund only a portion of a redevelopment project area go toward redevelopment costs related to or benefitting such area.
LB 496 establishes the use of TIF for construction and redevelopment of “workforce housing” (i.e., housing not to exceed $275,000) in “extremely blighted” or “rural” areas. Essentially, the bill allows for reimbursement of private costs via TIF if such private costs relate to the development of affordable housing in areas of extreme need. To use TIF in this way, municipalities must undertake a number of precursor actions, including developing a plan and holding a public hearing on the plan separate and apart from the public hearings associated with a normal TIF project.
LAND BANKS AND HOUSING
LB 873 expands the ability to establish a land bank from cities of the metropolitan class to all cities and villages in the state. Land banks are governmental entities (or nonprofits) that acquire vacant, abandoned and tax-delinquent properties with the goal of fixing such (legal) defects and making the properties more desirable to buyers and redevelopers.
LB 304 and LB 399 amend the Nebraska Housing Agency Act.
LB 1120 is an omnibus bill that, as introduced, had the potential to significantly impact the alcohol industry. As amended and passed, LB 1120 will regulate:
- Bottle Clubs: LB 1120 requires that operators of “bottle clubs,” which are establishments that allow patrons to join a club and bring their own beer wine or liquor to the venue, obtain a license subject to the oversight of the Nebraska Liquor Control Commission;
- Music Licensing: provides procedures for licensors to protect copyrights and file claims against entities that host live music performances without a license to use certain copyrights; and
- Growler Size: The maximum size for a growler is increased from 32 ounces to 64 ounces.
LB 1008 allows the Nebraska Power Review Board (“Board”) and public power providers to withhold “competitive or proprietary information” without violation of the public records law. Additionally, the bill provides deadlines and penalties for private electric suppliers who commence construction of privately developed renewable energy generation facilities and fail to provide the notice to the Board under section 70-1014.02. Consequently, the bill also provides a clear process for entities that miss the deadline under section 70-1014.02 to correct their non-compliance.
LB 901 requires the Director of the Nebraska Department of Aeronautics to specifically consider “terrain flight training areas” designated by the United States Department of Defense or the Nebraska National Guard when reviewing permit applications to build structures exceeding 150 feet in height and to deny any such applications if the proposed structure would significantly impact any such location. The bill limits these areas to those existing as of the effective date of the legislation. The bill also requires the application to include a written mitigation agreement between the applicant and the Nebraska National Guard.
Of additional note, renewable energy proponents defeated LB 1054. LB 1054 would have eliminated wind energy facilities from the definition of “privately developed renewable energy generation facility” under the statutes governing the Board. Currently, privately developed renewable energy generation facilities, including wind facilities, are exempt from the Board’s application and approval process if the facilities meet certain criteria. Under LB 1054, wind facilities would have no longer received this exemption, thereby creating a considerable deterrent to wind development in Nebraska.
LB 994 creates the Rural Broadband Task Force to study telecommunications service to unserved and underserved areas in rural Nebraska. A final report of the task force’s findings is due to the Legislature’s Executive Board no later than December 1, 2019.
LB 994 also authorizes the Nebraska Public Service Commission to withhold funding from companies that fail to provide adequate broadband service to unserved or underserved areas, and initiate reverse auctions to award funds to other broadband providers to deliver the needed service. LB 994 further exempts the sale, lease or rental of and the storage, use or consumption of dark fiber from state sales and use taxes.
LB 989 authorizes cities of the primary class to authorize the use of autonomous vehicles within their jurisdiction.
LBs 496, 873, 989 and 1120 remain subject to gubernatorial veto as of this writing. Copies of the bills and interim studies are available on the Nebraska Legislature’s website at http://www.nebraskalegislature.gov. As always, please do not hesitate to contact us if you have questions about these bills or any others. Thank you.