Expanded SID authority amended, advanced

Legislators advanced a bill from select file March 30 that would expand the authority of sanitary and improvement districts (SIDs).

When a property developer buys land for a housing development, an SID is created to install streets, sewers and power, as well as buy land for public parks. The SID is vested with taxing authority to finance these services.

LB324, introduced by Omaha Sen. John McCollister, would authorize SIDs to contract for solid waste collection services. Any solid waste collection contract entered into by an SID would be cancelled upon the district’s annexation by a city or village. McCollister said that the bill addresses an ambiguity in state statute with regard to SID authority.

Omaha Sen. Joni Craighead introduced an amendment, adopted 28-0, which incorporated provisions of her LB131. Under the amendment, expenditures by an SID would be restricted for 90 days upon receiving notification of a city or village’s intent to annex.

Craighead said the amendment would reduce the amount of risk taken on by cities proposing annexation.

Expenditures that would not be restricted include payments on construction bonds, construction fund warrants, general fund warrants and contracted labor and services, among others. Any proposed construction projects that have not been put to a public bidding process prior to receiving notice of annexation would be submitted to the city’s finance director for approval during the 90-day period.

Omaha Sen. Bob Krist opposed the amendment, saying that the annexation process has worked without placing restrictions on SIDs.

“Omaha has maintained a quality relationship with those they seek to annex and have gotten through the process without having to freeze money [in the past],” he said.

Provisions of two other bills, LB197 and LB420, were incorporated into LB324 on general file.

Originally introduced by Norfolk Sen. Jim Scheer, provisions of LB197 would provide additional powers to an SID when it is too close to a municipality to incorporate, yet too far away from a municipality to be annexed. These would have to be approved by the city council or village board within whose zoning jurisdiction the SID is located.

Provisions of LB420, originally introduced by Bellevue Sen. Sue Crawford, would require a person purchasing a home located in an SID to acknowledge in writing their understanding that the property is located within an SID.

The bill was advanced to final reading by a voice vote.