Tax exemptions proposed for public properties

Property owned by governmental entities for public use would be exempt from paying property taxes under a bill advanced from general file March 14.
Currently, a government entity wishing to issue tax-free bonds without a public vote must form a nonprofit leasing corporation. The corporation issues bonds and purchases the property. Ownership remains with the corporation until the bonds are paid off, at which time the property title is transferred to the government entity.
LB902, introduced by Omaha Sen. Burke Harr, would exempt such properties from paying property taxes. Purchases made by the leasing corporations also would be exempted from sales and use taxes. Harr said the bill codifies what already is standard practice.
“This clarifies what is current law,” Harr said. “It returns Nebraska back to the way things were intended to be.”
A Revenue Committee amendment, adopted 39-0, would enforce the sales and use tax exemption prospectively. The exemption would have been applied both prospectively and retroactively under the original bill.
The amendment also would extend the sales and use tax exemption to joint entities or agencies and includes an emergency clause.
Senators advanced the bill to select file on a 38-0 vote.