LB 1260

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                          LEGISLATURE OF NEBRASKA
                       ONE HUNDRED NINTH LEGISLATURE
                                 SECOND SESSION
                    LEGISLATIVE BILL 1260
    Introduced by Clements, 2.
    Read first time January 21, 2026
    Committee: Transportation and Telecommunications
1    A BILL FOR AN ACT relating to taxation; to amend sections 60-3,186,
260-3,187,   60-3,190,    and   79-1018.01,   Reissue   Revised   Statutes   of
3Nebraska; to change the percentage of motor vehicle tax proceeds and
4collected fees that are retained by county treasurers; to change the
5allocation of motor vehicle tax proceeds and collected fees; to
6provide for a motor vehicle tax supplement; to change and provide
7motor vehicle tax and fee schedules; to change the local system
8formula resources under the Tax Equity and Educational Opportunities
9Support Act; and to repeal the original sections.
10    Be it enacted by the people of the State of Nebraska,
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1Section 1. Section 60-3,186, Reissue Revised Statutes of Nebraska,
2  is amended to read:
360-3,186     (1)     The    department   shall      annually   determine    the    motor
4 vehicle tax on each motor vehicle registered pursuant to section 60-3,187
5    and shall cause a notice of the amount to be delivered to the registrant.
6    The notice may be delivered to the registrant at the address shown upon
7     his   or   her    registration      certificate      or   the   registrant's    most    recent
8 address according to information received by the department from the
9    National Change of Address program of the United States Postal Service or
10     delivered electronically to the registrant if the registrant has provided
11 electronic contact information to the department. The notice shall be
12    provided on or before the first day of the last month of the registration
13    period.
14(2)(a) The motor vehicle tax, motor vehicle fee, registration fee,
15  sales tax, and any other applicable taxes and fees shall be paid to the
16  county treasurer prior to the registration of the motor vehicle for the
17  following registration period. If the motor vehicle being registered has
18  been transferred as a gift or for a nominal amount, any sales tax owed by
19  the transferor on the purchase of the motor vehicle shall have been paid
20  or be paid to the county treasurer prior to the registration of the motor
21     vehicle for the following registration period.
22(b)(i) The county treasurer shall retain the following percent of
23     the   motor      vehicle    tax    proceeds    for    costs     incurred   by   such    county
24  treasurer:
25(A) For motor vehicle tax proceeds paid prior to July 1, 2028, one
26     percent; and
27(B) For motor vehicle tax proceeds paid on or after July 1, 2028,
28    two percent.
29(ii) The county treasurer shall transfer the following percent of
30  the motor vehicle tax proceeds to the State Treasurer for credit to the
31 Vehicle Title and Registration System Replacement and Maintenance Cash
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1  Fund:
2(A) For motor vehicle tax proceeds paid prior to July 1, 2028, one
3  percent; and
4(B) For motor vehicle tax proceeds paid on or after July 1, 2028,
5  one and two-tenths of one percent.
6(iii) The (b) After retaining one percent of the motor vehicle tax
7  proceeds collected for costs incurred by the county treasurer, and after
8  transferring one percent of the motor vehicle tax proceeds collected to
9  the State Treasurer for credit to the Vehicle Title and Registration
10  System Replacement and Maintenance Cash Fund, the remaining motor vehicle
11  tax    proceeds     that    remain      after    deducting   the    percents   specified      in
12  subdivisions (b)(i) and (ii) of this subsection shall be allocated as
13  provided in subdivision (c) of this subsection to each county, local
14  school system, school district, city, and village in the tax district in
15  which the motor vehicle has situs.
16(c) The remaining motor vehicle tax proceeds shall be allocated as
17  follows:
18(i) For motor vehicle tax proceeds paid prior to July 1, 2028: (A)
19  (c)(i) Twenty-two percent of the remaining motor vehicle tax proceeds
20     shall   be   allocated   to    the    county,    (B)   (ii)     sixty   percent    shall   be
21 allocated to the local school system or school district, and (C) (iii)
22     eighteen percent shall be allocated to the city or village, except that
23     (I) (A) if the tax district is not in a city or village, forty percent
24  shall be allocated to the county, and (II) (B) in counties containing a
25  city of the metropolitan class, eighteen percent shall be allocated to
26  the county and twenty-two percent shall be allocated to the city or
27  village.
28(ii) For motor vehicle tax proceeds paid on or after July 1, 2028:
29(A) If the tax district is in a city of the metropolitan class:
30(I) Twenty-six percent to the county;
31(II)     Forty-eight      percent    to    the   local    school    system    or   school
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1    district; and
2(III) Twenty-six percent to the city of the metropolitan class;
3(B) If the tax district is in a city other than a city of the
4    metropolitan class or in a village:
5(I) Thirty-one and one-half of one percent to the county;
6(II)    Forty-eight     percent     to    the    local    school     system   or   school
7    district; and
8(III) Twenty and one-half of one percent to the city or village; and
9(C) If the tax district is not described in subdivision (c)(ii)(A)
10    or (B) of this subsection:
11(I) Fifty-two percent to the county; and
12(II)    Forty-eight     percent     to    the    local    school     system   or   school
13    district.
14(d)     The   amount    allocated    to     a    local    school     system   shall   be
15    distributed to school districts in the same manner as property taxes.
16(3) Proceeds from the motor vehicle tax shall be treated as property
17    tax revenue for purposes of expenditure limitations, matching of state or
18    federal funds, and other purposes.
19(4) Beginning in October 2028, on or before the twentieth day of
20    each January, April, July, and October, the department shall:
21(a) Calculate the motor vehicle tax supplement that shall be paid to
22    each local school system or school district. Such supplement shall be
23    equal to forty and eight-tenths of one percent of the motor vehicle tax
24     allocated to such local school system or school district pursuant to this
25  section for the preceding three months; and
26(b) Provide a report to the State Treasurer. Each such report shall
27    indicate the amount of the motor vehicle tax supplement to be paid to
28    each local school system or school district that is calculated under this
29    subsection.
30(5)     Within   five   business     days       after    receiving    a   report   under
31    subdivision (4)(b) of this section, the State Treasurer shall pay, to
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1  each      local   school   system   or   school   district,   the   motor    vehicle   tax
2  supplements indicated in the report.
3(6) Beginning with fiscal year 2028-29, it is the intent of the
4     Legislature to appropriate each fiscal year an amount sufficient to pay
5     the motor vehicle tax supplements calculated under this section.
6Sec. 2. Section 60-3,187, Reissue Revised Statutes of Nebraska, is
7    amended to read:
860-3,187 (1) The motor vehicle tax schedules are set out in this
9  section.
10(2) The motor vehicle tax shall be calculated by multiplying the
11  base tax times the fraction which corresponds to the age category of the
12  vehicle as shown in the following table:
13     YEAR  FRACTION
14  First  1.00
15 Second  0.80
16 Second  0.90
17 Third  0.65
18 Third  0.80
19 Fourth  0.55
20 Fourth  0.70
21 Fifth  0.48
22 Fifth  0.60
23 Sixth  0.41
24 Sixth  0.51
25 Seventh  0.35
26 Seventh  0.42
27 Eighth  0.29
28 Eighth  0.33
29 Ninth  0.23
30 Ninth  0.24
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1 Tenth  0.14
2 Eleventh  0.10
3 Tenth and Eleventh  0.15
4 Twelfth  0.06
5 Thirteenth  0.04
6 Twelfth and Thirteenth  0.07
7 Fourteenth and older  0.02
8 Fourteenth and older  0.00
9     (3) The base tax shall be:
10     (a) Automobiles, autocycles, and motorcycles — An amount determined
11 using the following table:
12 Value when new  Base tax
13 Up to $3,999  $ 25
14 $4,000 to $5,999  35
15 $6,000 to $7,999  45
16 $8,000 to $9,999  60
17 $10,000 to $11,999  100
18 $12,000 to $13,999  140
19 $14,000 to $15,999  180
20 $16,000 to $17,999  220
21 $18,000 to $19,999  260
22 $20,000 to $21,999  300
23 $22,000 to $23,999  340
24 $24,000 to $25,999  380
25 $26,000 to $27,999  420
26 $28,000 to $29,999  460
27 $30,000 to $31,999  500
28 $32,000 to $33,999  540
29 $34,000 to $35,999  580
30 $36,000 to $37,999  620
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1 $38,000 to $39,999  660
2 $40,000 to $41,999  700
3 $42,000 to $43,999  740
4 $44,000 to $45,999  780
5 $46,000 to $47,999  820
6 $48,000 to $49,999  860
7 $50,000 to $51,999  900
8 $52,000 to $53,999  940
9 $54,000 to $55,999  980
10 $56,000 to $57,999  1,020
11 $58,000 to $59,999  1,060
12 $60,000 to $61,999  1,100
13 $62,000 to $63,999  1,140
14 $64,000 to $65,999  1,180
15 $66,000 to $67,999  1,220
16 $68,000 to $69,999  1,260
17 $70,000 to $71,999  1,300
18 $72,000 to $73,999  1,340
19 $74,000 to $75,999  1,380
20 $76,000 to $77,999  1,420
21 $78,000 to $79,999  1,460
22 $80,000 to $81,999  1,500
23 $82,000 to $83,999  1,540
24 $84,000 to $85,999  1,580
25 $86,000 to $87,999  1,620
26 $88,000 to $89,999  1,660
27 $90,000 to $91,999  1,700
28 $92,000 to $93,999  1,740
29 $94,000 to $95,999  1,780
30 $96,000 to $97,999  1,820
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1 $98,000 to $99,999  1,860
2 $100,000 to $101,999  1,900
3 $100,000 and over  1,900
4 $102,000 to $103,999  1,940
5 $104,000 to $105,999  1,980
6 $106,000 to $107,999  2,020
7 $108,000 to $109,999  2,060
8 $110,000 to $111,999  2,100
9 $112,000 to $113,999  2,140
10 $114,000 to $115,999  2,180
11 $116,000 to $117,999  2,220
12 $118,000 to $119,999  2,260
13 $120,000 to $121,999  2,300
14 $122,000 to $123,999  2,340
15 $124,000 to $125,999  2,380
16 $126,000 to $127,999  2,420
17 $128,000 to $129,999  2,460
18 $130,000 to $131,999  2,500
19 $132,000 to $133,999  2,540
20 $134,000 to $135,999  2,580
21 $136,000 to $137,999  2,620
22 $138,000 to $139,999  2,660
23 $140,000 to $141,999  2,700
24 $142,000 to $143,999  2,740
25 $144,000 to $145,999  2,780
26 $146,000 to $147,999  2,820
27 $148,000 to $149,999  2,860
28 $150,000 to $151,999  2,900
29 $152,000 to $153,999  2,940
30 $154,000 to $155,999  2,980
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1    $156,000 to $157,999  3,020
2    $158,000 to $159,999  3,060
3    $160,000 to $161,999  3,100
4    $162,000 to $163,999  3,140
5    $164,000 to $165,999  3,180
6    $166,000 to $167,999  3,220
7    $168,000 to $169,999  3,260
8    $170,000 to $171,999  3,300
9    $172,000 to $173,999  3,340
10    $174,000 to $175,999  3,380
11    $176,000 to $177,999  3,420
12    $178,000 to $179,999  3,460
13    $180,000 to $181,999  3,500
14    $182,000 to $183,999  3,540
15    $184,000 to $185,999  3,580
16    $186,000 to $187,999  3,620
17    $188,000 to $189,999  3,660
18    $190,000 to $191,999  3,700
19    $192,000 to $193,999  3,740
20    $194,000 to $195,999  3,780
21    $196,000 to $197,999  3,820
22    $198,000 to $199,999  3,860
23    $200,000 and over  3,900
24(b) Assembled automobiles — $60
25(c) Assembled motorcycles other than autocycles — $25
26(d) Cabin trailers, up to one thousand pounds — $10
27(e) Cabin trailers, one thousand pounds and over and less than two
28 thousand pounds — $25
29(f) Cabin trailers, two thousand pounds and over — $40
30(g) Recreational vehicles, less than eight thousand pounds — $160
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1(h) Recreational vehicles, eight thousand pounds and over and less
2  than twelve thousand pounds — $410
3(i) Recreational vehicles, twelve thousand pounds and over — $860
4(j)   Assembled   recreational    vehicles       and   buses   shall   follow   the
5  schedules for body type and registered weight
6(k) Trucks — Over seven tons and less than ten tons — $360
7(l) Trucks — Ten tons and over and less than thirteen tons — $560
8(m) Trucks — Thirteen tons and over and less than sixteen tons —
9    $760
10(n) Trucks — Sixteen tons and over and less than twenty-five tons —
11  $960
12(o) Trucks — Twenty-five tons and over — $1,160
13(p) Buses — $360
14(q) Trailers other than semitrailers — $10
15(r) Semitrailers — $110
16(s) Former military vehicles — $50
17(t) Minitrucks — $50
18(u) Low-speed vehicles — $50
19(4) For purposes of subsection (3) of this section, truck means all
20  trucks      and   combinations   of   trucks      except    those   trucks,   trailers,    or
21  combinations thereof registered under section 60-3,198, and the tax is
22  based on the gross vehicle weight rating as reported by the manufacturer.
23(5) Current model year vehicles are designated as first-year motor
24     vehicles for purposes of the schedules.
25(6) When a motor vehicle is registered which is newer than the
26     current model year by the manufacturer's designation, the motor vehicle
27     is subject to the initial motor vehicle tax in the first registration
28  period and ninety-five percent of the initial motor vehicle tax in the
29  second registration period.
30(7) Assembled cabin trailers, assembled recreational vehicles, and
31    assembled buses shall be designated as sixth-year motor vehicles in their
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1    first year of registration for purposes of the schedules.
2(8) When a motor vehicle is registered which is required to have a
3 title branded as previous salvage pursuant to section 60-174, the motor
4 vehicle tax shall be reduced by twenty-five percent.
5Sec. 3. Section 60-3,190, Reissue Revised Statutes of Nebraska, is
6    amended to read:
760-3,190 (1) A motor vehicle fee is imposed on all motor vehicles
8    registered for operation in this state. An owner of a motor vehicle which
9    is exempt from the imposition of a motor vehicle tax pursuant to section
10    60-3,185 shall also be exempt from the imposition of the motor vehicle
11    fee imposed pursuant to this section.
12(2) The department shall annually determine the motor vehicle fee on
13    each motor vehicle registered pursuant to this section and shall cause a
14    notice of the amount to be delivered to the registrant. The notice shall
15    be combined with the notice of the motor vehicle tax required by section
16    60-3,186.
17(3) The motor vehicle fee schedules are: set out in this subsection
18 and subsection (4) of this section. Except for automobiles with a value
19     when    new   of    less       than    $20,000,       and    for    assembled,  reconstructed-
20    designated,        and     replica-designated  automobiles,       the        fee     shall    be
21    calculated     by    multiplying  the     base       fee    times   the        fraction     which
22    corresponds    to        the   age    category    of    the       automobile     as    shown      in   the
23    following table:
24    YEAR  FRACTION
25    First through fifth  1.00
26    Sixth through tenth  .70
27    Eleventh and over  .35
28(4) The base fee shall be:
29(a) Automobiles, with a value when new of less than $20,000, and
30     assembled, reconstructed-designated, and replica-designated automobiles —
31  $11 $5
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1(b) Automobiles, with a value when new of $20,000 through $39,999 —
2     $22 $20
3(c) Automobiles, with a value when new of $40,000 or more — $33 $30
4(d) Motorcycles and autocycles — $11 $10
5(e) Recreational vehicles and cabin trailers — $33 $10
6(f) Trucks over seven tons and buses — $33 $30
7(g) Trailers other than semitrailers — $11 $10
8(h) Semitrailers — $33 $30
9(i) Former military vehicles — $11 $10
10(j) Minitrucks — $11 $10
11(k) Low-speed vehicles — $11 $10.
12(4) (5) The motor vehicle tax, motor vehicle fee, and registration
13    fee shall be paid to the county treasurer prior to the registration of
14    the motor vehicle for the following registration period. After retaining
15    two   one    percent  of    the    motor    vehicle    fee    collected     for    costs,      the
16    remaining proceeds shall be remitted to the State Treasurer for credit to
17    the Motor Vehicle Fee Fund. The State Treasurer shall return money funds
18    from the Motor Vehicle Fee Fund remitted by a county treasurer that is
19    which are needed for refunds or credits authorized by law.
20(5)(a) (6)(a) The Motor Vehicle Fee Fund is created. On or before
21    the   last       day    of    each       calendar    quarter,       the   State   Treasurer  shall
22    distribute all money funds in the Motor Vehicle Fee Fund as follows: (i)
23    Seventy-four       Fifty  percent    to    the   county     treasurer     of   each      county,
24    amounts in the same proportion as the most recent allocation received by
25    each county from the Highway Allocation Fund; and (ii) twenty-six fifty
26     percent     to    the    treasurer  of    each   municipality,     amounts       in   the   same
27     proportion as the most recent allocation received by each municipality
28 from the Highway Allocation Fund. Any money in the fund available for
29    investment shall be invested by the state investment officer pursuant to
30    the   Nebraska  Capital       Expansion       Act     and    the   Nebraska       State      Funds
31    Investment Act.
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1(b) Money Funds from the Motor Vehicle Fee Fund shall be considered
2     local revenue available for matching state sources.
3(c)    All   receipts   by   counties     and    municipalities       from    the    Motor
4     Vehicle Fee Fund shall be used for road, bridge, and street purposes.
5(6) (7) For purposes of subdivisions (3)(a) (4)(a), (b), (c), and
6 (f)     of    this   section,   automobiles      or    trucks    includes     all    trucks      and
7 combinations of trucks or truck-tractors, except those trucks, trailers,
8 or semitrailers registered under section 60-3,198, and the fee is based
9 on the gross vehicle weight rating as reported by the manufacturer.
10(7) (8) Current model year vehicles are designated as first-year
11     motor vehicles for purposes of the schedules.
12(8) (9) When a motor vehicle is registered which is newer than the
13 current model year by the manufacturer's designation, the motor vehicle
14 is subject to the initial motor vehicle fee for six registration periods.
15(9) (10) Assembled vehicles other than assembled, reconstructed-
16 designated, or replica-designated automobiles shall follow the schedules
17 for the motor vehicle body type.
18Sec. 4. Section 79-1018.01, Reissue Revised Statutes of Nebraska, is
19 amended to read:
2079-1018.01     Except   as    otherwise       provided   in    this   section,       local
21 system formula resources include other actual receipts available for the
22 funding       of   general   fund    operating    expenditures        as   determined       by   the
23     department for the second school fiscal year immediately preceding the
24 school fiscal year in which aid is to be paid. Other actual receipts
25 include:
26(1) Public power district sales tax revenue;
27(2) Fines, penalties, and license money distributed in accordance
28 with Article VII, section 5, of the Constitution of Nebraska and license
29 fees;
30(3) Tuition receipts from individuals, other districts, or any other
31 source except receipts derived from adult education, receipts derived
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1    from    summer    school    tuition,    receipts    derived   from    early    childhood
2    education tuition, tuition receipts from converted contracts beginning
3    with the calculation of state aid to be distributed in school fiscal year
4    2011-12, and receipts from educational entities as defined in section
5    79-1201.01       for   providing     distance     education   courses       through   the
6     Educational      Service    Unit    Coordinating    Council   to     such     educational
7     entities;
8(4) Transportation receipts;
9(5) Interest on investments;
10(6) Other miscellaneous noncategorical local receipts, not including
11     receipts     from      private     foundations,    individuals,      associations,     or
12  charitable organizations;
13(7) Special education receipts;
14(8) Special education receipts and non-special-education receipts
15    from the state for wards of the court and wards of the state;
16(9) All receipts from the temporary school fund. Receipts from the
17    temporary school fund shall only include (a) receipts pursuant to section
18    79-1035 and (b) the receipt of funds pursuant to section 79-1036 for
19    property leased for a public purpose as set forth in subdivision (1)(a)
20    of section 77-202;
21(10) Motor vehicle tax and motor vehicle tax supplement receipts
22    received;
23(11) Pro rata motor vehicle license fee receipts;
24(12) Other miscellaneous state receipts excluding revenue from the
25     textbook loan program authorized by section 79-734;
26(13) Impact aid entitlements for the school fiscal year which have
27    actually been received by the district to the extent allowed by federal
28    law;
29(14) All other noncategorical federal receipts;
30(15) Receipts under the federal Medicare Catastrophic Coverage Act
31  of 1988, as such act existed on January 1, 2014, as authorized pursuant
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1    to sections 43-2510 and 43-2511 for services to school-age children,
2     excluding amounts designated as reimbursement for costs associated with
3     the implementation and administration of the billing system pursuant to
4     section 43-2511;
5(16) Receipts for accelerated or differentiated curriculum programs
6    pursuant to sections 79-1106 to 79-1108.03; and
7(17) Revenue received from the nameplate capacity tax distributed
8  pursuant to section 77-6204.
9Sec.   5.      Original   sections    60-3,186,   60-3,187,   60-3,190,   and
10    79-1018.01, Reissue Revised Statutes of Nebraska, are repealed.
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