Tax increase to fund workforce housing clears final round

Lawmakers gave final approval April 9 to a measure intended to create a stable funding source for two Nebraska workforce housing programs.

LB1067, sponsored by Syracuse Sen. Bob Hallstrom, increases the documentary stamp tax on real estate transactions and splits the additional proceeds between the Rural Workforce Housing Investment Fund and Middle Income Workforce Housing Investment Fund.

The programs, administered by the state Department of Economic Development, provide grants to nonprofit developers to build workforce housing in the state’s rural and urban communities.

The measure increases the documentary stamp tax from $2.32 to $3.32 for each $1,000 in value through Jan. 1, 2032, when it will return to the previous amount.

Beginning July 1, 2027, the bill also prohibits the transfer of money from the Affordable Housing Trust Fund to the state’s General Fund and certain other funds.

The state Department of Revenue estimates that LB1067 will increase documentary stamp tax revenue by $13.4 million in fiscal year 2026-27 and $18.5 million in FY2027-28.

The bill passed on a vote of 36-13.