Bill > LB389

This bill eliminates the property tax levy authority for educational service units (ESUs) starting in fiscal year 2028-29 and replaces the lost revenue with direct state funding. Specifically, the bill establishes a mechanism to provide state funds to ESUs beginning in 2029, with the initial distribution based on the property taxes levied in 2027 and increased annually by 3.5%. For fiscal years 2013-14 through 2027-28, only ESUs with four or more member school districts or those composed of a single Class IV or Class V school district will be allowed to levy property taxes. From 2028-29 onward, no ESUs will have the power to levy property taxes. The Department of Revenue will calculate and certify the annual distributions to each ESU, which will be paid in two equal installments on March 31 and August 31. This approach ensures that ESUs maintain their funding levels while transitioning away from local property tax levies to state-funded support, providing financial stability and predictability for these educational service units.

Budget and Finance

https://nebraskalegislature.gov/bills/view_bill.php?DocumentID=59140