A bill that would expand the potential use of land banks in Nebraska advanced from select file July 30.
LB424, introduced by Grand Island Sen. Dan Quick, would allow any municipality in Nebraska to join an existing land bank—a tax-exempt political subdivision that acquires, manages and develops vacant and tax-delinquent properties—under the Nebraska Municipal Land Bank Act.
Currently, only municipalities in Douglas and Sarpy counties are eligible under state law to create land banks. The bill was amended on general file to allow primary class cities also to create stand-alone land banks. Lincoln currently is the state’s only primary class city.
As amended, LB424 also would:
• prohibit a land bank from issuing bonds;
• prevent a land bank from investing in a property that financially could benefit a board member their businesses or their immediate family members;
• prevent a land bank from receiving property tax revenue from an agreement under the Joint Public Agency Act; and
• allow an entity that creates or joins a land bank to withdraw from the agreement by a two-thirds vote.
Quick introduced an amendment during select file debate that he said would strengthen conflict of interest provisions, reduce the number of parcels a land bank could own and eliminate an automatically accepted bid process except for land banks in metropolitan class cities.
“That is a big compromise, but this bill is that important,” Quick said.
Lincoln Sen. Mike Hilgers said the amendment improved the bill but that he remained opposed to the expansion of land banks, primarily out of concern that they might use the public trust to further their own financial interests.
“One of the things that I was concerned about was ensuring that we had stronger conflict of interest provisions,” Hilgers said.
Sen. Steve Erdman of Bayard said he opposed the bill despite the changes, saying it would not solve the problem of blighted properties.
“There’s not an improvement you can make to this bill to get my vote,” Erdman said.
The Quick amendment was adopted 33-4 and LB424 advanced to final reading by voice vote.