A bill that would have paved the way for Nebraska cities to create separate political subdivisions to issue bonds and impose new taxes appeared dead for the year after lawmakers sent it back to committee Monday.

A recent hearing on LB 381, introduced by Sen. Kent Rogert, attracted testimony from public finance professionals, including representatives from the League of Nebraska Municipalities and Omaha.

The bill would have given cities the ability to create separate subdivisions, or community improvement districts, with the authority to assess a separate sales tax of up to 1% or special assessments on property to pay for services and capital improvements. Districts could have financed projects such as arenas, shopping malls, or convention centers, proponents said.

After the hearing, lawmakers sent the bill back to the revenue committee for reconsideration. Lawmakers critical of the bill questioned the need for a new sales tax, according to local reports.

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