Cities and towns in Nebraska would have the express authority to borrow funds to purchase property or construct improvements under a bill advanced from select file April 13.<\/p>\n
LB152, introduced by the Urban Affairs Committee, would allow municipalities to borrow from state- or federally-chartered banks, savings banks, building and loan associations and savings and loan associations.<\/p>\n
Bellevue Sen. Sue Crawford, chairperson of the committee, brought an amendment on select file that made several changes to the bill.<\/p>\n
The amendment authorizes direct borrowing by resolution as well as ordinance and clarifies that municipalities could use direct borrowing to refinance loans at a lower rate. The amendment also removed the term \u201csignificant\u201d in reference to taxpayer savings over traditional bond financing as a requirement for direct borrowing.<\/p>\n
Crawford said concerns were raised after the bill was discussed on general file that the term was ambiguous and possibly could leave municipalities vulnerable to litigation.<\/p>\n
Under the amended bill, funds could be borrowed for any purpose for which a municipality is authorized by law to purchase property or fund improvements. Loans would not be restricted to a single year and could be repaid in installments.<\/p>\n
The ability of municipalities to borrow directly from financial institutions to cases in which financing the purchase of property or construction of improvements:
\n\u2022\twould be impractical;
\n\u2022\tcould not be completed within the time restraints facing the municipality; or
\n\u2022\twould generate taxpayer savings over traditional bond financing.<\/p>\n
The bill also includes public notice requirements for direct borrowing from a financial institution and caps the total amount of indebtedness from direct borrowing to 10 percent of the municipal budget for a city or 20 percent of the municipal budget for a village.<\/p>\n
Following adoption of the Crawford amendment on a 30-0 vote, the bill advanced to final reading by voice vote.<\/p>\n","protected":false},"excerpt":{"rendered":"
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