- Associated Press - Monday, March 7, 2016

LINCOLN, Neb. (AP) - A bill that would have allowed Nebraska’s natural resources districts to issue bonds for certain water projects stalled in the Legislature Monday amid arguments that it would encourage more local government spending.

Sen. Rick Kolowski of Omaha shelved his proposal for the year after acknowledging that he didn’t have enough votes to overcome a filibuster. Without bonding authority, Kolowski said many of the districts will have to pay for projects slowly over time.

The bill would have allowed the state’s natural resources districts to issue general obligation bonds for projects that don’t produce revenue, such as flood control and recharging groundwater reserves. It also would have required a two-thirds majority vote by a district’s governing board. The legislation would sunset on Dec. 31, 2025.

Nebraska’s 23 natural resources districts regulate groundwater within each of the state’s river basins. The districts are overseen by locally elected governing boards.

Opponents said the measure would undermine the Legislature’s push for property tax reductions. In recent years, state and local agencies have responded well to floods and drought without the need for additional funding, said Sen. Lydia Brasch of Bancroft.

“Water is important, but reducing taxes is a priority,” Brasch said.

Brasch pointed to the state water sustainability funding approved by lawmakers in 2014, which included an initial $32 million investment followed by roughly $11 million each year. Senators created the fund to ensure the state is prepared for floods, drought-induced water shortages and water quality problems.

But districts with a smaller tax base have struggled to generate the matching money needed to qualify for the state aid, said Dean Edson, executive director of the Nebraska Association of Resources Districts.

Edson said bonding would have allowed those smaller districts to generate enough money up-front to qualify for state aid and allow them to repay the borrowed money over several years.

Without the bill, “they’re probably going to have to come up with the match some other way,” Edson said. “They’re probably going to have to raise their (levy) rates and start saving money.”

Opponents attached a series of amendments to the bill to prolong debate on the measure and keep it from getting to a vote. One amendment by Sen. Beau McCoy of Omaha would have required voter support rather than board approval for issuing the bonds.

“The individual voters in the 23 NRDs across our state should be able to weigh in” before their district issues bonds, McCoy said.

Sen. David Schnoor of Scribner said he was concerned about the potential long-term costs for taxpayers.

“It’s about the growth of government, and giving government another tool to spend money,” he said.

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The bill is LB344

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