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LB 1114, brought by the Welcome Home Coalition and supported by Nebraska REALTORS®, was passed by the Nebraska Legislature this year and creates the Community Improvement District Act.
The new law establishes Community Improvement Districts (CIDs) in Nebraska as a financing tool to support public infrastructure and amenities tied to residential, commercial, and redevelopment projects, including affordable housing developments.
Under the law, CIDs may be formed within the boundaries of a city or village through an application and approval process involving the City Council or Village Board and with consent from a majority of property owners within the proposed district boundaries. Municipalities retain their existing tax levy authority, revenue streams, and development standards within the district while assuming no debt or future financial obligations associated with the district’s financing.
The legislation authorizes CIDs to issue income tax-exempt municipal debt to finance eligible infrastructure improvements. This financing structure provides several benefits, including lower-cost financing, non-recourse debt to developers, reduced upfront lot costs for homeowners by spreading infrastructure expenses over a 20- to 30-year repayment period, and off-balance-sheet growth opportunities for municipalities.
By creating a locally driven mechanism to fund infrastructure, the law helps remove longstanding barriers to residential development and creates new opportunities for starter homes, workforce housing, and community growth across Nebraska.
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