Restoration of state aid to cities and counties proposed

Nebraska municipalities and counties would see some direct state aid restored under a bill heard by the Appropriations Committee March 18.

As introduced by Gering Sen. John Stinner, LB633 would appropriate $40 million in general funds beginning in fiscal year 2015-16, to be divided equally between incorporated municipalities and counties. Funds could be used only for public infrastructure projects.

Stinner presented an amendment to the committee that provides formulas for distributing the funds and specifies qualifying public infrastructure projects.

Under the amendment, the $20 million appropriation to municipalities would be allocated proportionally based on the population of each incorporated municipality. The $20 million appropriated to counties would be allocated proportionally based on lineal feet of bridges in each county. A county with no bridges would receive a distribution equal to 85 percent of the smallest county aid distribution.

A qualifying municipal public infrastructure project would include, but not be limited to, highways and bridges, sidewalks, wastewater systems, hazardous waste disposal systems, airports and mass transit systems.

A qualifying county infrastructure project would include public roads, highways and bridges, jails and correction facilities, buildings and equipment used for county services.

Stinner said the elimination of direct state aid to cities and counties in 2011 has added to the challenge of maintaining public infrastructure across Nebraska. The infrastructure deficit for streets, roads and bridges alone is in the billions, he said.

“Obviously, the funds appropriated by LB633 would not totally address the huge infrastructure deficit facing municipalities and counties,” Stinner said. “However, LB633 is an important first step to help restore the historic partnership between the state and municipal and county governments.”

Lincoln Mayor Chris Beutler testified in support of the bill, saying local infrastructure is a pressing need for many cities and counties. Lincoln would receive approximately $2.8 million under the formula outlined in the amendment, he said, which likely would be used for roads.

“The city of Lincoln maintains about 1,240 miles of roads,” Beutler said. “We spend $51 million annually on road repair, rehabilitation and new construction. That is $7 million less than the closest estimate of what our needs are, which is $58 million a year.”

Renee Fry, executive director of OpenSky Policy Institute, also testified in support of the bill, saying it would reduce reliance on property taxes to fund infrastructure needs. Nebraska ranks 43rd in state aid to local governments, she said.

“If we want to meaningfully and sustainably reduce our over-reliance on property taxes,” she said, “increasing state aid to local governments such as proposed in LB633 is a good first step.”

No opposition testimony was given and the committee took no immediate action on the bill.