Taxes in Nebraska > Source of Major State and Local Taxes > Chronology in Changes of Tax Policy Since 1982


Scroll below to view the entire chronology, or click on a year below to go directly to that year. Please note that information may not be available for all years.

1982 | 1983 | 1984 | 1985 | 1986 | 1987 | 1988 | 1989
1990 | 1991 | 1992 | 1993 | 1994 | 1995 | 1996 | 1997 | 1998 | 1999
2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007

1982 - LB 757 - Increased the sales tax rate temporarily from May 1 through Dec. 31, 1982 from 3% to 3.5%.

LB 760 - Increased the corporate income tax thresholds and the higher rate. Prior to LB 760, corporate income tax rates were 25% of the individual rate, or 3.75% at that time on the first $25,000 of taxable income and 27.5% (4.05%) on income greater than $25,000. After LB 760, the rates were 25% of the individual rate on the first $50,000 of taxable income and 35% (5.25%) on amounts more than $50,000. It was expected that the increase would generate and additional $13 million in revenue.

1983 - LB 17 - Allowed sales tax exemptions for film rentals where admission is charged, water and energy used in raising livestock, and custom computer software and training.

LB 59 - Increased the sales tax from 3.5% to 4% for nine months to create the Cash Reserve Fund. The amount raised was $30 million.

LB 169 - Provided that the Legislature is to set the sales and income tax rates, beginning Jan. 1, 1984. Prior to this time, the State Board of Equalization set the sales and income tax rates on or before each Nov. 15 so that revenue would be sufficient to fund the enacted budget and so that the two taxes raised similar amounts for the General Fund.

LB 363 - Eliminated the sales tax on food and the food sales tax credit against the income tax. Although the sales tax collected on food and the credit were supposed to be roughly equal, today the exemption of food costs about $130 million.

LB 396 - Eliminated a general homestead exemption that exempted the first $800 of value of a homestead valued at $4,000 or more. The cost savings was $4.7 million.

1984 - LB 791 - Exempted clinics owned by hospitals from the sales tax. Cost - $500,000.

LB 796 - Exempted medical oxygen from the sales tax.

LB 809 - Adopted a general homestead exemption of $3,000 and required property tax statements to reflect that the state was financing the exemptions. This was estimated to cost about $18 million. However, the program was delayed and then repealed after one year. It was never implemented.

LB 892 - Created the Economic Forecasting Advisory Board and set the sales tax rate at 3.5% and the income tax rate at 19% of federal liability.

LB 1124 - Adopted provisions changing the apportionment of the income of a multi-state, unitary business in accordance with the provisions of the Uniform Distribution of Income for Tax Purposes Act (UDITPA) from worldwide to nationwide combined reporting. Included in the statutes both before and after LB 1124 were an equally-weighted three-factor apportionment formula and a throw back rule.

Prior to a Nebraska Supreme Court case involving Kelloggs, income was apportioned on a worldwide basis with the worldwide income being calculated on sales, property and payroll in the state compared to all sales, payroll and property worldwide. In the case the Nebraska Supreme Court held that Nebraska could not tax the net income of foreign subsidiaries, but allowed the company to apportion domestic income while factoring in the sales, payroll and property of those foreign subsidiaries. The bill was adopted in response to this case and was designed to retain $10 - $20 million annually of income tax revenue that would otherwise have been lost.

Under LB 1124 the unitary income of any corporation and its subsidiaries was divided, or apportioned to the states where the company does business based on the amount or sales in the state compared to the amount of sales in the U.S., the amount of payroll in the state as compared to the nationwide payroll, and the value of the property located in the state as compared to the value of all property in the U.S. A unitary business is any business that is conducted as a single economic unit whether conducted by one or many separate corporations, that has common ownership.

1985 - LB 271 - Changed the valuation methodology for agricultural land to one based on the earning capacity of the land. This change was in response to the Kearney Convention Center case and the subsequent constitutional amendment.

LB 273 - Enacted a sales tax refund for new manufacturing equipment purchased for a plant expansion or relocation. There was to be no refund for replacing old equipment. The bill also terminated a renewable energy tax credit effective Jan. 1, 1986.

LB 282 - Struck to requirement that the Legislature set the sales and income tax rates so as to generate similar amounts of money for the General Fund and the requirement that income tax rates be changed in increments of one percent and sales tax rates in increments of one-half percent.

LB 344 - Repealed Nebraska's participation in the Multistate Tax Compact.

LB 662 - Called for the merger or affiliation of all Class I districts by Sept. 1, 1989, and increased the sales tax rate by one percent for the purpose of limiting property tax support of K-12 schools to no more than 45% of total costs. LB 662 was referred to the ballot by petition and repealed by the voters in the November 1986 election.

LB 727 - Delayed the effective date of the general homestead exemption enacted by LB 809 (1984) until Jan. 1, 1986.

LB 715 - Expanded the sales tax base to include warranties and service contracts, custom computer software, and some utilities used by business. Overall, this expansion of the sales tax base was about $20 million.

LB 6 (2nd Special Session) - Repealed the $3,000 general homestead exemption.

1986 - LB 539 - Increased the sales tax rate from 3.5% to 4% effective Jan. 1, 1987.

LB 561 - Exempted prescription oxygen from the sales tax.

LB 774 - Enacted the Financial Institutions Deposit Tax in lieu of imposing the income tax on banks and other savings institutions. Problems had arisen because states are prohibited from taxing earnings attributable to United States securities. First, such earnings were excluded from the tax base. Under LB 774, the state taxes deposits at a rate pegged to the income tax rate, the tax not to exceed an amount of tax based on net income.

LB 1027 - Extended the sales tax to the installation or provision of cable television or community antennae services and warranties and service agreements. The bill also exempted sales by booster clubs and certain farm machinery sold at auction. Net increase in revenue was estimated to be $1.2 million.

LB 1124 - Enacted the Employment Expansion and Investment Incentive Act. This act grants incentives to businesses that increase employment by two employees and invest at least $75,000. The incentives are $1,500 for each new employee and $1,000 for each $75,000 in investment. In 2000, total credits claimed under the Act (as amended by LB 270 (1987)) were $4.5 million.

LB 1258 - Provided for a sliding scale for homestead exemption benefits for elderly and disabled beneficiaries as income increased.

1987 - LB 304 - Extended the sales tax collection obligation to retailers soliciting sales in this state on a regular, continuous, or systematic basis by means of advertising.

LB 772 - Phased in sales only apportionment of the unitary income of multi-state corporations for corporate income tax purposes. Prior to LB 772, the unitary income of multi-state corporations was apportioned to Nebraska based on three, equally weighted factors, the property in the state, the payroll in the state and the sales in the state relative to the nation. LB 772 shifted the weighting over five years so that by 1992, sales in the state was the only determining factor. The reduction in revenue was estimated to be $7 million when fully implemented.

LB 773 - Decoupled Nebraska's individual income tax from federal income tax liability and coupled it to federal adjusted gross income instead. Prior to 1987, Nebraska individual income tax was calculated as a percentage of the federal tax. Since LB 773, Nebraska has its own standard deduction amount, personal exemptions brackets and rates. The rates for the various brackets are calculated in relation to a base rate. The tax increase resulting from this conversion was about $20 million.

LB 775 - Enacted the Employment and Investment Growth Act. This grants income tax credits, and sales tax refunds for companies that hire at least 30 new employees and invest at least $3 million. The income tax credits are equal to 5% of the increased payroll at the project for five years and 10% of the investment in the project. The benefits also include a refund of any sales taxes paid on equipment of other taxable property purchased in connection with the project. LB 775 also repealed the two-year-old sales tax refund for purchases of industrial machinery and equipment for plant expansions. For projects promising at least $10 million in new investment and 100 new employees, qualifying companies may also receive a 15-year personal property tax exemption for mainframe computers, certain aircraft, and agricultural processing equipment used in connection with the project. For 2000, the cost of the program is estimated to be between $30 to $150 million depending on the percentage of the jobs claimed can be assumed to have been in the state regardless of the credit.

LB 775 also contained provisions allowing the exclusion of capital gains income from sales of the stock of the individual's employer obtained during employment. The cost of this benefit varies wildly from $2 million to $50 million per year.

1988 - LB 1091 - Created a fund to reimburse local governments for any losses attributable to the railroad 4R Act litigation that exceeded one percent of expected property tax dollars. After line item vetoes and partial overrides, the amount appropriated to the fund from the Cash Reserve Fund totaled $7.7 million.

LB 1105 eliminated the sliding scale of benefits for homestead exemptions and provided that those with income below the filing threshold of $10,400 received the full $35,000 exemption.

LB 1234 - Increased the standard deduction under the income tax to be equal to the federal standard deduction. The net reduction was $11 million. The bill also amended LB 775 (1987) by specifying that relocating a business within the state or transferring control of an existing business does not qualify for incentives under the act.

1989 - LB 84 - Granted an 8.5% reduction in property valuation or a $5,400 general homestead exemption for 1989 only, the reductions to be financed by the state. Total cost - $114 million.

LB 198 - Exempted purchases by the State Fair from the sales tax.

LB 209 - Exempted carrier access charges between telephone companies from the sales tax. This bill prevented the assessment of $7.6 million in revenue annually and more than $37 million in retroactive liability to telephone companies pursuant to a position of the Revenue Department taken after the anti-trust breakup of AT&T.

LB 361 - Changed the assessment of agricultural and horticultural land so that the results could be adjusted to be uniform across county lines.

LB 714 - Enacted the current three-choice election for building contractors for sales tax purposes. Contractors may be treated as retailers, as final consumers subject to tax, or as final consumers with a tax-free inventory.

LB 739 - Lowered the income tax rate for two brackets, adopted an elderly and child care credit, and increased the personal exemption amount. The net reduction was $24 million.

LB 793 - Extended the sales tax to include satellite television programming and equipment.

1990 - LB 1059 increased the sales tax rate from 4% to 5% and the income tax rates by 8.5% for 1990 and an additional 8.5% for 1991 to fund the Tax Equity and Educational Support Act. This landmark school finance legislation dramatically increased state aid distributed to schools in an "equalized" manner. School costs were calculated per student within nine "tiers" or groups of similarly-sized schools and the formula enabled each school district to finance the average cost per student for the tier with a combination of state aid and property taxes at a defined "local effort rate". The rate varied based on the amount of appropriation available. LB 1059 also "rebated" 20% of the income tax paid by residents of the district to the district. Total cost when fully implemented was about $210 million.

1991 - LB 300 - Exempted automobile rebates from the sales tax.

LB 320 - Changed the assessment of agricultural land so that the capitalization rate used to set value is market-derived. The capitalization rate was increased 25% so that the resulting values from the income calculation correlates to 80% of market value. This change was made in response to Banner County v. Bd. Of Equal. which held that separate classification of agricultural land as allowed by the Constitution does not authorize the assessment of such land non-uniformly or disproportionately compared to other taxable property. The change was to be effective for 1992.

LB 404 - Froze agricultural and horticultural land values for tax year 1991 at the 1990 value. This was to give the Legislature time to respond to Banner County.

LB 444 - Exempted durable medical equipment from the sales tax.

LB 772 - Included sales of entire businesses and their assets within the definition of occasional sales exempt from tax.

LB 829 - Exempted all personal property from the property tax for 1991 only and reimbursed local governments for the loss using a series of revenue-raising proposals including a depreciation surcharge, a corporate income tax surcharge, a temporary reduction in the sales tax collection fee, extending the sales tax to manufacturing energy, and a one-year increase in the corporate occupation tax.. The total cost was $120 million.

1992 - LB 1063 - Adopted net book value approach for the valuation of all personal property and therefore added farm machinery to the tax rolls. The reduction in value for personal property other than previously-exempted farm machinery averaged about 20%. Had no constitutional amendment passed to authorize the net book value approach to valuation of personal property, the bill called for assessing all personal property, including farm and business inventories at actual value. LB 1063 also allowed a refund of sales taxes paid on farm machinery, provided the machinery appeared on the personal property tax schedule. The revenue lost from the sales tax exemption was replaced with a temporary $4 per ton tax on commercial fertilizer and a reduction in county personal property replacement aid of $3.5 million.

LB 719A - provided that the personal property value of railroads be reduced in proportion to the share of business personal property not subject to tax under the net book value approach, primarily inventory.

LB 1240 - Enacted the Enterprise Zone Act. This act grants larger investment tax credits under the Employment Expansion and Investment Incentive Act for projects located in five designated areas in the state. Jobs credits available under the act are also larger if the project employs residents of the enterprise zone.

LR 219CA - Placed a constitutional amendment on the primary ballot for 1992 that separated personal property from real property for purposes of the uniformity clause, authorized personal property to be either taxed on actual value or net book value while allowing reasonable classifications to be exempt, and set apart a classification for the property of entities that are protected by federal law, like railroads.

1993 - LB 240 - Increased individual income taxes on high income individuals by changing brackets and rates, replacing the personal exemption with a personal credit, and phasing out itemized deductions, the standard deduction, and the benefit of lower brackets. Taxes on lower income individuals were reduced or eliminated making the proposal revenue neutral, but the income tax system became more progressive.

LB 345 - In addition to a number of administrative changes, LB 345 changed the sales tax exemption for property incorporated into real estate to property annexed to real estate and eliminated the exemption for installation labor. The bill also granted sales tax exemptions for oxygen used in aquaculture, food sold at political events, and extended the sales tax refund for agricultural machinery to depreciable repair parts.

LB 346 - Provided that a 4.5% excise tax be levied on rental motor vehicles. Proceeds from the tax are to be retained by the car rental company to pay motor vehicle property taxes and any excess is to be remitted to counties to be distributed like property taxes.

1994 - LB 961 - Exempted livestock from the personal property tax and reduced the fertilizer tax from $4 per ton to $1 per ton beginning in 1997. The proceeds of the tax were used to fund ethanol incentives through 1996 and natural resources enhancement through 2000, when the fertilizer tax terminated.

LB 901 - Exempted copyrighted programming and veterinary medicine from the sales tax at a net cost of $2 million.

LB 902 - Enacted significant reform of the homestead exemption program. This bill (1) included various forms of otherwise tax exempt income within the definition of household income, (2) increased the exempt amount and allowed it to increase as the average home value in the county increases, (3) increased the income eligibility amounts and adopted a graduated scale of benefits based on income, and (4) adopted a maximum value of the home qualification. Overall, these changes were revenue neutral.

LB 1087 - Restored the exemption for installation labor without the taxation of such labor ever having been enforced. This exemption was again repealed in 2002.

1995 - LB 300 - Amended the phase-out of itemized deductions provided for in LB 240 (1993) so that charitable deductions are not phased out.

LB 430 - Exempted from the sales tax refractory brick used in the making of steel or cement and molds, dies and patterns used for injection molding of plastic or stamped from metal. Cost - $1 million. The exemption for refractory brick was repealed in 2002.

LB 452 - Revised the property tax calendar so that equalization occurs first in the process, before individual valuation protests.

LB 490 - Created the Tax Equalization and Review Commission to hear appeals of property tax valuation and exemption disputes instead of the district courts. The bill also separated the property tax division from the Department of Revenue and called for the Property Tax Administrator to be separately appointed by the Governor to a definite six-year term.

LB 559 - Provided for the phase out of the throw back rule for apportioning corporate income for tax purposes over three years. From 1998 forward, sales of a multistate corporation shipped from Nebraska to a customer in another state where the company has no nexus (and therefore cannot be taxed by that state) were no longer considered Nebraska sales for purposes of apportioning multistate income. Cost $2.6 million.

LB 829 - Adopted the Quality Jobs Act. This act allows companies that promise to increase employment and investment by either (1) $50 million in investment and 500 new jobs, or (2) $100 million in investment and 250 new jobs to retain the state withholding of employees up to 5% of the increased payroll, such withholding to instead be spent on employee benefit programs. The Act expired in 2000.

LB 830 - Adopted the Nebraska Redevelopment Act. This act allows companies that meet the sales thresholds of investment and employment as in the Quality Jobs Act, to receive tax increment financing for a project on vacant land and areas up to ten miles outside city limits. The Act expired in 2000.

LR 3CA - Placed on the ballot for the primary election in 1996 a proposal to eliminate the State Board of Equalization as the body that equalizes assessments between counties and replace it with the Tax Equalization and Review Commission (TERC). The constitutional amendment was ultimately approved by the people.

1996 - LB 106 - Exempted water, chemicals and feed related to the raising of livestock from the sales tax. Cost - $3.5 million.

LB 299 - Imposed a limit on local government expenditures of "restricted funds" generally property taxes, local sales taxes, and state aid to local governments. The limit was 2% for FY1996-97 and 0% for FY1997-98. Growth equal to the percentage growth in population was allowed, as was an additional 1% with a three-fourths vote of the governing body. Exceptions were for capital improvements, judgments, except for CIR judgments, and expenditures in support of a jointly provided public service.

LB 1050 - Revised the school aid formula to (1) limit the amount of income tax rebate to $82 million, (2) change the distribution of Insurance Premium Tax dollars from per student to including the proceeds as part of the equalization aid program, and (3) created an incentive for schools that consolidate.

LB 1085 - Established procedures for merging counties or county offices, and allowed counties to turn over the assessment function to the Property Tax Division upon approval of a resolution by the county board.

LB 1114 - Imposed levy limits on all local governments to limit the total property tax rate (excluding exceptions) to $2.24 per $100 of taxable value beginning in 1998 and $2.13 when fully implemented in 2001. Exceptions were for bonded debt, grandfathered building fund projects for schools, grandfathered capital lease purchases, and voter-approved overrides. Another crucial change was the concept of allocated levies, wherein counties were responsible for allocating levy authority to dozens of small, miscellaneous governments within the 45-cent limit of the county.

LB 1177 - Created the Municipal Equalization Fund and provided for aid to municipalities that are unable to raise the average amount of property tax revenue per capita with the average property tax levy. The bill also allowed counties to levy a sales tax of up to 1.5% in areas outside municipalities with a sales tax to support the county share of jointly provided public safety services.

LB 1368 - Amended the Quality Jobs Act by providing for an alternate method for claiming the wage benefit credit allowed by the act. The alternative is a sliding scale corporate income tax credit depending on the average wage of the new jobs.

1997 - LB 269 - (1) Changed the levy limit for Community Colleges from eight cents through FY2000-01 and four cents thereafter to eight cents through FY1999-2000 and seven cents thereafter, (2) created a new equalization formula for funding Community Colleges that makes up for any difference between the maximum levy times the valuation for the area and 40% of the total spending allowed to the area, (3) provided for levy allocation by municipalities for Community Redevelopment Authorities, city airport authorities and other entities created by cities, and (4) divided municipalities into three different size groupings for purposes of the equalization formula provided in LB 1177 (1996).

LB 271 - Eliminated the property tax on motor vehicles and replaced it with a uniform, statewide tax and fee system. The fee is a nominal amount, generally between $5 and $30 and the proceeds are distributed to cities and counties based on the distribution of Highway Trust Fund dollars. The motor vehicle tax is determined from a table that begins with a higher tax if the MSRP of the vehicle when new is more and declines with the age of the motor vehicle itself. The schedule was designed seeking a reduction in taxes on motor vehicles of about $15 million from the previous year property tax amounts but the actual proceeds turned out to be $30 million less.

LB 397 - Implemented LR 3CA (1995) by granting the TERC the authority to equalize values between counties.

LB 401 - Reduced income tax rates 4.4%, and increased the personal exemption by $10 for two years. The reduced revenue was about $75 million annually.

LB 806 - Revised the school aid formula by eliminating the tiers created in LB 1059 (1990) and providing for only three cost groupings, sparse, very sparse, and standard. The bill also provided for allocation or calculation of the budget for Class I schools that are part of a Class VI system or are affiliated with another K-12 district, thus integrating the levy of each "system" into the levy limits of LB 1114 (1996). Finally, the bill increased the appropriation for school aid by $110 million.

LB 875 - Amended community redevelopment law (tax increment financing) to (1) require a hearing and specific notice to other affected local governments of the redevelopment plan, (2) require any land within the redevelopment plan to be annexed into the city, (3) require a finding that the proposed project would not be feasible without TIF, and (4) require a cost benefit analysis before approving a TIF project beginning Jan. 1, 1999.

1998 - LB 149 - Made a school finance change that provided that the amount of school aid to be provided by the state is to be the full amount needed to fund all calculated needs of schools, assuming a local effort rate equal to 10 cents less than the levy limit.

LB 695 - Provided an equalized aid program for counties. The program distributes about $6 million annually to counties that are unable to generate the average number of dollars per road mile by levying the average county property tax rate. The bill also provided that counties receive $35 per day for state prisoners held in county jails.

LB 989 - Made permanent the LB 299 (1996) limitations on local government expenditures of restricted funds. The base limitation rate is currently 2.5%.

LB 1028 - Made the LB 401 income tax reductions permanent.

LB 1104 - Reduced the sales tax by 0.5 percent from July 1, 1998 through June 30, 1999, at a cost of $95 million.

LB 1120 - Created an aid program for rural and suburban fire protection districts that cooperate by setting a uniform tax rate to finance these services in the great majority of any one county. The aid amount is $10 per rural resident within the agreement. The annual cost is about $2.5 million.

LR 45CA placed four separate constitutional amendments on the 1998 general election ballot as follows: (1) strike the requirement that motor vehicle taxes be distributed to local governments in proportion to property taxes levied, (2) provide for the merger or consolidation of cities and counties, (3) limit the property tax exemption for government property to property used for a public purpose, and (4) strike all references to townships in the Constitution. The first three amendments succeeded while the fourth failed.

1999 - LB 36 - Created the Department of Property Assessment and Taxation as a separate state agency.

LB 142 - Implemented part of LR 45CA by providing that the proceeds from the motor vehicle tax be distributed 60% to the school where the vehicle is registered, 22% to the county and 18% to the city except in Douglas County where the city-county shares are reversed.

LB 179 - Increased the homestead exemption income eligibility amounts and expanded the definition of disability for purposes of eligibility. The cost of this expansion was $8.8 million.

LB 232 - Exempted purchases by natural resources districts from the sales tax. Cost - $275,000

LB 271 - Implemented part of LR 45CA by placing government-owned property not in a public use on the tax rolls. In most cases, taxes are to be assessed to the lessee of government-owned property as if it were owned by the lessee.

LB 280 - Exempted mobility-enhancing equipment from the sales tax. Cost - $20,000.

LB 382 - Established two convention center financing programs. The larger one returns 70% of attributable state revenue to the city building the convention center. Attributable state revenue is the increased sales and income tax revenue that economic modeling shows is caused by the construction of the convention center and the presence of conventions that are new to the state. The other program sets aside the other 30% of attributable state revenue for a grant program for convention centers in smaller cities.

LB 630 - Adopted the Beginning Farmer Tax Credit to incent established farmers to enter into lease agreements with beginning farmers, that is those with limited assets. The credit is to be equal to 5% of the rental amount.

LB 881 - Used the Cash Reserve Fund to provide for specific property tax relief programs. For 1999, $30 million was distributed to community colleges based on valuation. For 2000, $35 million (later reduced to $25 million) was used for a direct credit against real estate taxes. The $30 million additional distribution to community colleges was also repeated in 2000 using General Funds. Finally, in 2001, $35 million was transferred to the General Fund to help finance the additional school aid needed to fund the reduction in the levy limit for schools from $1.10 per $100 of taxable value to $1.00.

2000 - LB 557 - Exempted purchases by airport authorities from the sales tax. Cost - $225,000.

LB 936 - Enacted the Rural Economic Opportunities Act. The act provides credits against income tax for businesses that (1) increase employment by 0.5% of the labor force in the county and pay at least 125% of the average wage in the county or 100% of the average wage in the region and (2) invest an amount at of least $50,000 times the required number of new employees if the county has a population of 300 or less or $100,000 times the required number of new employees in large counties. The credits are 5% of the increased payroll at the project and 10% of the investment.

2001 - LB 433 - Granted an income tax credit to businesses equal to 30% of the subsidized costs of providing child care services to its employees. The credit is generally available for three years and cannot exceed 50% of the firm's tax liability. During the 2001 special session, the operative provisions of the act were delayed until 2003.

LB 620 - Adopted the Invest Nebraska Act to replace the expired Quality Jobs Act. Essentially, the benefits are like the Quality Jobs Act provisions that grant a sliding scale credit of 3% of the increased payroll at the project to 5% based on the average wage at the project. This credit may be taken against the withholding obligation of the employer. There is also a smaller qualification threshold of $10 million in investment and 25 new employees for projects in counties with a population of 100,000 or less. In this level of qualification, the jobs must pay at least the average annual wage in the state. For those companies qualifying with the old Quality Jobs Act thresholds, the jobs must pay at least 110% of the state's average wage. Finally, a "super tier" level of qualification is provided for companies promising to invest at least $200 million and employ at least 500 new employees at a wage of at least 120% of the state's average wage. Such qualifiers receive either the wage benefit credit allowed the other qualifiers or a 15% investment credit.

2002 - LB 57 - Exempted copies of public records from the sales tax.

LB 123 - Exempted elected county fair boards and drainage districts from the sales tax.

LB 898 - Statutorily reduced the calculated needs of schools by about 1.25% for FY2002-03 through FY2004-05 to reduce school aid by about $22 million.

LB 905 - Decoupled the Nebraska estate and generation-skipping transfer taxes from the allowable state death tax credit in federal law and coupled these taxes to the federal gross estate or generation-skipping transfer. An exemption amount of $1 million was adopted for both taxes and a tax rate table provided that is like the state death tax credit as it existed in years prior to 2002. This act retains revenue to the state that would have been lost under federal tax reductions equal to about $20 million.

LB 947 - Brought Nebraska into compliance with the federal Mobile Telecommunications Sourcing Act by providing that mobile phone use be sourced at the home or business address of the contract owner regardless of where the calls are made or received. Increased revenue to the state was estimated to be about $670,000.

LB 994 - Among several other provisions, LB 994 provided that the state will not accept transfer of the assessment function from a county if such a transfer would not promote efficiency or effectiveness or if the Legislature fails to make the necessary appropriation. The bill also provided that if the money to be distributed under the County Property Tax Relief Program is not enough to fund all the needs as determined under the formula, the available funds are to be prorated.

LB 1085 - Enacted a number of temporary tax increases and a permanent expansion of the sales tax base as follows: (1) Increases the cigarette tax by 30 cents per pack and the tobacco products tax by one-third for two years only, beginning Oct. 1, 2002. The proceeds are to be deposited mostly in the Cash Reserve Fund, (2) Increases the sales tax rate from 5% to 5.5% for one year only, beginning Oct. 1, 2002, (3) increases individual income tax rates by an average of 2.2% for tax year 2003 only, (4) Expands the sales tax base to include services such and building cleaning and maintenance, pest control, motor vehicle services and installation labor beginning Oct. 1, 2002. The bill also repealed the previously-existing exemptions for refractory brick and subscription magazines, and (5) Requires companies taking advantage of bonus depreciation allowed by recent federal changes to add back 85% of such depreciation for purposes of the Nebraska return. The bonus depreciation lost can be deducted over five years beginning in 2005. Total revenue from LB 1085 is expected to be $120 million to the General Fund and $30 million to the Cash Reserve Fund.

2003 - LB 282 - LB 282 ratified the Streamlined Sales and Use Tax Agreement as approved by the implementing states, including Nebraska, on Nov. 12, 2002. The bill also enacted conforming changes to the statutes that are required to participate with the other states in the Streamlined System. The bill did not change the tax base of the state of Nebraska in any way, but many definitions were changed or moved and all exemptions from tax were relocated to the same place in the statutes.

The bill also spelled out all the conditions Nebraska is agreeing to as a consequence of participating in the agreement. These conditions include using uniform definitions, sourcing, and rounding rules, providing sixty days notice for all state and local changes in rate or base, recognizing out-of-state companies that register for collection through the governing organization of the agreement, and complying with the decisions of the governing organization.

LB 283 - LB 283 increased the alcoholic beverages tax by about 33% for beer and 25% for wine and spirits. The tax rate on beer increased from 23 cents per gallon to 31 cents on July 1, 2003. The tax on most wine increased from 75 cents per gallon to 95 cents, and the tax on spirits increased from $3.00 per gallon to $3.75. LB 283 was expected to generate an additional $8.5 million annually, or one million dollars more that what would have been generated by LB 759 had LB 283 not passed.

The bill also changed the Nebraska estate tax. For decedents dying on or after Jan. 1, 2003 and before July 1, 2003, the state estate tax is equal to the greater of any state death tax credit available or the amounts as calculated by the table enacted last year by LB 905. For decedents dying on or after July 1, 2003, the tax will be as determined by a new table. For estates from $1 million to $1.1 million the state estate tax rate is the federal tax rate for that size estate, 41%. This imposes a Nebraska tax that will recoup all state death tax credit amounts accumulated on the estate for up to the taxable estate size.

Beginning with amounts greater than $1.1 million, the rate of state tax is the rate the state death tax credit was in 2002 for an estate of that size. The rates begin at 6.4% and maximize at 16% for estates greater than $9 million.

Finally, the bill deferred the tax credit available for businesses providing subsidized child care for employees from tax year 2003 until tax year 2007.

All three aspects of LB 283 were also enacted in LB 759, but LB 283 was enacted with an emergency clause, allowing the alcoholic beverages tax and estate tax provisions to be effective July 1 instead of Oct. 1 as was the case under LB 759.

LB 540 - allows schools to increase their levies by up to five cents per one hundred dollars of taxable valuation with a three-fourths vote of the school board to make up for the loss of state aid. The increased levy authority is for FY2003-04 and FY2004-05 only.

LB 596 - This bill required taxpayers to add back to federal adjusted gross income or for corporations, federal taxable income, the amount of any additional bonus depreciation or any section 179 capital expensing that is in excess of $25,000 that is allowed because of the federal Jobs and Growth Tax Act of 2003. It also placed the 2003 federal standard deduction amounts in the Nebraska statute and provided that they be adjusted for inflation in future years.

LB 608 - LB 608 replaced the Employment Expansion and Investment Incentive Act with an application-based, limited program that is available for projects in those counties with a population of less than 25,000. Companies are to apply for benefits while stating the expected number of new employees and investment. To qualify, the project must promise at least five new employees and $250,000 of new investment. The amount of the credits that can be earned are $3,000 for each new employee and $3,750 for each $50,000 of investment.

If the project qualifies, the taxpayer and the Tax Commissioner are to enter into a contract. However, the total amount of possible credits that the Tax Commissioner may approve may not exceed $2.5 million for FY2004-05 and FY2005-06 and $3 million in the years following. Projects are approved on a first come first serve basis.

LB 622 - LB 622 eliminated most of the per capita distribution of any funds remaining in the Municipal Equalization Fund after the total needs of the formula have been satisfied. Instead only $300,000 of the excess funds will be distributed to cities and the rest will be deposited in the state's General Fund. The $300,000 will be distributed per capita only to those cities and villages without a local sales tax.

The bill also suspended distributions under the county equalization program for FY2003-04 and FY2004-05 and requires a 40-cent levy as a minimum effort for distributions made after that.

LB 759 retained the income tax rates adopted the previous year instead of allowing the rates to decrease to the 2002 level after tax year 2003. It also retained the cigarette and tobacco products tax increase indefinitely, with the proceeds of the cigarette tax after Oct. 1, 2004, to be deposited in the General Fund. The bill also increased beer and liquor taxes by about 25%, effective Oct. 1, 2003.

The bill expanded the sales tax base to include repair labor, except for repair to motor vehicles and farm machinery, RV park charges, newspaper advertising supplements, animal specialty services, except veterinary services and services to livestock, and detective services. The bill also subjected repair or maintenance of personal property, the sales of which would be subject to sales tax, except for repairs to motor vehicles to the sales tax.

The bill provided that all annexation labor, and labor for repairs to real estate be taxable. However, it also provided exemptions for labor charges for new construction, the addition of a floor or room, finishing an unfinished space, restoring or reconstructing a structure damaged by a natural disaster, or building electrical generating or transmitting structures.

Rehabilitation of at least 75% of an existing building will also be exempt, but the contractor will be required to notify the Department of Revenue that that project qualifies for the exemption. Rehabilitation of an existing building that at least doubles the market value of the building allows the taxpayer to receive a refund through the Department of Revenue.

LB 759 was expected to generate $347 million for the biennium, or $236 million annually.

LR 2CA placed on the November 2004 ballot a proposal to amend Article VIII, Section 2 of the Nebraska Constitution to allow the exemption from property taxes, in whole or in part, the increased value of property created by rehabilitating or preserving historically significant real property. The proposed amendment was adopted by the people in 2004.

2004LB 644 requires local county assessors to report every four years, all property owned by governmental entities and, if it is subject to tax, its value and taxes levied.

LB 841 extended the sales tax exemption for charitable entities to include intermediate care facilities for the mentally retarded. This change was consistent with previous interpretations of the exemption. The bill also adopted a six percent of net revenue tax on ICF-MRs. The proceeds of the tax are to be distributed (1) to the facilities to recoup the tax with the matching federal funds (2) $312,000 for community based programs and (3) any remainder to the general fund.

LB 1017 amended the taxation of construction labor to adopt a statutory presumption that a taxable project is 60% taxable labor and 40% materials upon which tax has already been paid. It also provided a mechanism for contractors or owners to receive pre-approval that a remodeling project is labor tax exempt.

LB 1017 also adopted Nebraska's first tax amnesty program for the period from August 1st to Oct. 31, 2004. The amnesty was available to only those taxpayers with unreported liability, not for dleinquent taxpayers. It was expected to generate about $6 million in revenue with $1 million of the proceeds directed to the Department of Revenue to hire auditors, purchase lists and software, and otherwise increase enforcement of the revenue laws.

LB 1034 changed the Nebraska estate tax to eliminate the 41% first bracket rate and raise the same amount of revenue by adding an additional bracket and increasing the rate for estates greater than $3.5 million.

LB 1065 provided additional funding for ethanol production incentives by (1) reducing the income tax credit for use of gasoline for off-road purposes by 1.25 cents, (2) increasing the ethanol checkoff from ½-cent to ¾-cent per bushel of corn or hundredweight of sorghum, and (3) transferring $1.5 million annually from the Petroleum Release Remedial Action Fund.

2005LB 28 – Created a new tax credit for planned contributions into certain trusts or direct contributions made by corporations. A resident individual or a pass-through entity is allowed an income tax credit equal to 30% of the present value of a planned gift in the year the planned gift is made to a trust for the benefit of a 501(c)(3) organization, not to exceed tax liability or $10,000.

For a C-corporation, the credit is 20% of a direct contribution to the 501(c)(3) organization, limited to $10,000. Individuals, pass-through entities and corporations may not receive a credit for any contribution that was deducted for income tax purposes. An individual contribution may be a planned gift, but a corporate contribution must be an actual gift to the foundation to be eligible for the credit.

LB 66 – LB 66 implemented Amendment 2 which was adopted by the people in November 2004 and allowed the exemption of the increased value of real property caused by rehabilitating or preserving historically significant real property. The bill allowed a property tax assessment preference for property that is on the National Register of Historic Places or would be eligible for such designation as determined by the State Historic Preservation Officer. Essentially, the value of the property will remain fixed at the pre-rehabilitation value for eight years after rehabilitation is complete before phasing in to full market value assessment over four additional years

LB 90 - Increased the excise tax, or checkoff, levied on sales of corn and grain sorghum to finance ethanol incentives from three-fourths cent to seven-eights cent per bushel of corn or hundredweight of sorghum beginning Oct. 1, 2005, through Oct. 1, 2010. The bill also amended intent language to increase general fund appropriations to the Ethanol Production Incentive Cash Fund. The general fund appropriations are to be $4 million for FY2005-06 and FY2006-07 (up from $1.5 million previously), $5.5 million for FY2007-08, and $2.5 million for FY2008-09 through FY2011-12. The total increase in general fund support for the EPIC fund is intended to be $20.5 million under LB 90.

The first three sections of LB 90 created the Building Entrepreneurial Communities Act to provide grants, distributed by the Department of Economic Development, to collaborating communities, at least one of which is in economic distress. The grants are to be matched dollar for dollar by local funds and are for projects to develop entrepreneurial and technical assistance, build business capacity or leadership or generate opportunities for young families. Grants cannot exceed $75,000 and may last for two years. The program is to terminate Jan. 1, 2011.

LB 90 also created the Agricultural Opportunities and Value-Added Partnerships Act to support value-added opportunities through innovative partnerships among agricultural and community interests, increase the agricultural share of the entire food system profit, and enhance opportunities to participate in electronic commerce. The Department of Economic Development and the Department of Agriculture are to establish a competitive grant process to fund promising projects in research, education and training, market development, and business planning and technical assistance. Grants cannot exceed $75,000 for any one project and are to be matched by at least 25% of the applicant's funds. Annual reports of the activities under the act are to be made and the act is to terminate on Jan. 1, 2011.

Finally, the bill increased the maximum net worth for agricultural loan recipients from $300,000 to $500,000 and increased the maximum loan amount from $250,000 to $500,000 for purposes of NIFA financing.

LB 261 - Repealed outright the authorization for Agricultural and Horticultural Land Valuation Boards.

LB 312 - Adopted the Nebraska Advantage Act, a multi-faceted tax incentive to replace the Employment and Investment Growth Act. The bill also adopted the Nebraska Advantage Research and Development Act which created a tax credit for increases in research and development spending and the Nebraska Microenterprise Tax Credit Act to grant refundable tax credits for investing in microenterprises. The bill also renamed the Employment Expansion and Investment Incentive Act as the Nebraska Advantage Rural Development Act and created an additional tier of benefits under that act for counties with population less than 15,000 if the company increases employment by only two jobs and invests only $125,000. Finally, the bill granted a sales tax exemption for manufacturing machinery and equipment, defined broadly, and any repairs or other services thereto.

There will be no new applications under the Employment and Investment Growth Act (LB 775, 1987) after Jan. 1, 2006, the operative date of the Nebraska Advantage Act.

There will be five tiers of benefits allowed under LB 312:

Tier 1 - $1 million of new investment and ten new jobs. This tier will only be available to manufacturers, research and development or testing businesses, and high tech services that export at least 75% of their product. Qualifying businesses under this tier will be eligible for a refund of one-half of any sales tax paid for purchases at the project, a sliding-scale jobs credit (detailed below), and a three percent investment credit.

Tier 2 - $3 million of new investment and 30 new jobs. It will be available to manufacturers, data processing companies, financial services companies, transportation and distribution companies, telecommunications companies, research and development or testing businesses, and high tech services that export at least 75% of their product. This tier is currently provided in LB 775. Beneficiaries receive a 100% sales tax refund for purchases at the project, the wage credit and a 10% investment credit.

Tier 3 - $0 investment and 30 jobs. This tier will be available to the same types of businesses as Tier 2, and will allow the beneficiaries to receive only the wage credit.

Tier 4 - $10 million in investment and 100 new jobs. This tier will be available to the same types of businesses as Tier 2 and is also currently provided in LB 775. In addition to the sales tax refund, jobs credit, and the ten percent investment credit, qualifying businesses under this tier will receive a personal property tax exemption for turbine-powered aircraft, mainframe computers, agricultural processing machinery, and distribution personal property like shelving, conveyer belts and forklifts.

Tier 5 - $30 million in investment with no new jobs requirement. This tier will be available to the same types of businesses as Tier 2 and exists in LB 775, except that the investment threshold has been increased from $20 million to $30 million and beneficiaries will be required to maintain at least the same number of jobs at the project as were in existence the year before the project application.

Tier 1 and Tier 3, will sunset after five years.

Qualifiers in all tiers except Tier 5 will receive a wage credit equal to 3% of the increased compensation at the project if the jobs pay between 60% and 75% of the state average wage, 4% if they pay between 75% and 100%; 5% if they pay between 100% and 125%; and 6% if they pay more than 125% of the state average wage. Employees must be paid at least 60% of the state average wage to count as new employees under the act and to be considered in determining the percentage amount of credit received. Credits are earned for employment and investment made any time during the entitlement period.

LB 312 requires an annual report from the Tax Commissioner every July 15. The report will list agreements under the act, the identities of the taxpayers, and the locations of the projects. The report will also show investment, employment and benefits earned by industry group.

LB 312 adds a new requirement for project-specific information. The new information to be reported is (1) the identity of the taxpayer, (2) the location of the project, and (3) the total amount of investment and jobs credits used and refunds granted over the prior two years as a single aggregated number. This information will be reported every other year. The report will also have to describe the methodology used in calculating the net impact of the program and any investment or industry multipliers used, and any limitations in the methodology.

LB 312 also enacted the Nebraska Advantage Microenterprise Act. This act grants refundable income tax credits equal to 20% of any new investment or employment by a microenterprise in a distressed area of the state. Microenterprises are businesses with five or fewer employees. Distressed areas are defined with regard to high unemployment, population loss or below average income. The amount of credits for which an applicant or a close relative can qualify is limited to $10,000 for the life of the program. The maximum amount of credits that can be approved by the Department of Revenue in any one year is $3 million. There are to be no new applications for benefits under the act after Dec. 31, 2010.

LB 499 - Provided that any estate tax liability shall be apportioned to reduce the amount of tax in proportion to the amount of the estate of a resident decedent that is held as real and personal property located in another state. For a nonresident decedent, the tax shall be the amount that the in-state property represents as a proportion of the entire estate. These changes were made retroactive for decedents dying on or after Jan. 1, 2003, the operative date of LB 905 (2002), which decoupled from the maximum federal estate tax credit and enacted a free-standing estate tax.

LB 753 – Amended the definition of "construction services" that are within the sales tax base to include installing, furnishing or connecting utility services beginning Oct. 1, 2003, the operative date of LB 759 (2003). What this did is make the taxability of installing telephone or cable lines dependent upon whether or not the entire construction project is taxable or not based on the exemptions in LB 759 (2003).

2006 - LB 808 – In addition to a number of procedural changes, LB 808 modified the greenbelt provisions of Nebraska law. Generally, the changes narrowed the availability of greenbelt, but the bill also eliminated zoning as a requirement for greenbelt and phased out the requirements of recapture over three years.

Under LB 808, the land must be "agricultural land" rather than merely being in agricultural use. "Agricultural land" means that an entire parcel must be predominantly used for the commercial production of agricultural products under LB 808.

LB 904 – Changed the distribution of state sales taxes collected on sales of motor vehicles. Previously the first 5% of sales tax collected was deposited in the Highway Trust Fund while any excess over 5% was deposited in the state's General Fund. After Oct. 1, 2006, these additional amounts, if any are deposited in the Highway Allocation Fund and distributed equally between cities and counties for their streets and roads.

The bill also required cities and counties to spend city sales taxes collected on motor vehicles for street and road purposes except for pre-existing bonds pledging this revenue for another purpose.

LB 968 – Enacted a new sales tax exemption for construction labor performed on single family homes and duplexes and a refund for owner-occupied condominiums.

With regard to the income tax, the bill increased income tax brackets by about $1,000, granted a refundable earned income tax credit equal to 8% of the federal credit, and terminated the add-back of bonus depreciation or excess section 179 capital expensing beginning with the 2006 tax year.

LB 968 also terminated the phase-outs of the standard deduction, itemized deductions, and personal exemption credits for high-income taxpayers, also effective beginning with the 2006 tax year.

Regarding the property tax, the bill decreased the assessment percentage for agricultural land from 80% to 75% of actual value, effective Jan. 1, 2007, and eliminated the termination date for the increase in the school levy to $1.05 per $100 of taxable value. Under LB 968, the levy limit will remain $1.05 rather than returning to $1.00 in 2009.

The bill also made changes to increase the benefits available under the homestead exemption program, also effective for 2007. The exempt amount was increased from the greater of $40,000 or 80% of the average home value in the county to the greater of $40,000 or 100%. For disabled and veteran beneficiaries, the exempt amount increased from the greater of $50,000 or 100% to the greater of $50,000 or 120%. The maximum value also increased from the greater of $95,000 or 150% of the average home value in the county to the greater of $95,000 or 200%. The maximum value for handicapped and veteran claimants also increased a comparable amount.

LB 990 - Added a new way of qualifying for benefits under the Nebraska Advantage Rural Development Act. The act now allows a tax credit equal to 10% of any investment in livestock modernization equipment provided the investment is at least $50,000. These investments may occur anywhere in the state and receive the refundable tax credit. LB 990 also increased the tax credits available under the Beginning Farmer Tax Credit Act to 10% of the cash rental amount or 15% of the cash equivalent amount of the share rental amount. The bill also created a refundable credit for the beginning farmer equal to the entire cost of a financial management program, up to $500.

2007LB 305 - LB 305 directed that sales tax from leasing of motor vehicles to the Highway Trust Fund, the same as sales taxes from the sale of motor vehicles. Previously, these funds flowed to the state General Fund.

LB 334 - LB 334 amended more than 150 sections of statute to strike references to the “Department of Property Assessment and Taxation” and the “Property Tax Administrator” and replace them with the “Department of Revenue” or the “Tax Commissioner” respectively. The bill merged the two departments and established a Property Assessment Division within the Department of Revenue. The bill was operative July 1, 2007.

The bill also excluded trade fixtures from the definition of real property and included trade fixtures within the definition of personal property. Finally, LB 334 required county treasurers collecting taxes on behalf of fire districts and county agricultural societies to remit tax proceeds in the same manner as other local governments rather than through a warrant procedure, required county assessors to review properties on a cycle to assure that all parcels have been inspected and reviewed at least every six years.

LB 338 – Doubled the amount that may be excluded for Nebraska income tax purposes for contributions to a Nebraska educational savings plan trust account. For a married filing separately return, the maximum amount deducted was increased from $500 to $2,500 and for all other taxpayers from $1,000 to $5,000.

LB 343 - Enacted an income tax credit equal to thirty percent of any investment in a biodiesel facility prior to Jan. 1, 2015. The maximum credit that may be allowed is $250,000 and no more than 10 percent of the credit may be taken each of the first two years the facility produces B100 biodiesel and no more than 50 percent in the third year. The credit is limited to no more than half of the taxpayer’s liability. It may be carried forward up to 15 years.

The bill also expanded the exclusion of capital gains from the sale of the stock of the taxpayer’s employer to include extraordinary dividends. “Extraordinary dividends” were defined as any dividend exceeding twenty percent of the value of the stock at the time the dividend is declared.

LB 367 - Was a multi-faceted tax cut proposal involving sales taxes, income taxes, property taxes and estate taxes.

Regarding property taxes, the bill created a cash fund to be distributed to counties based on valuation and fund a property tax credit for all real property owners. The amount in the cash fund is $105 million for tax year 2007 and $115 million for 2008. Amounts after 2008 will be set by the Legislature. The resulting levy reductions will be about eight cents per $100 of taxable valuation for both 2007 and 2008.

Regarding the income tax, the bill eliminated the so-called “marriage penalty” by increasing the married, filing joint brackets so that they are double the current single return levels. Head of household brackets were also increased proportionately. LB 367 also increased the current standard deduction in the statute to the federal level and provided for indexing like the federal indexing.

The bill also repealed the Business Child Care Expense Credit for businesses providing subsidized child care. This credit was first authorized in 2001, but has been delayed several times and would have become operative in 2007. Finally, LB 367 increased the earned income tax credit from 8% of the federal credit to 10%. All of these changes are effective for tax year 2007 and future years.

Regarding sales taxes, the bill repealed the sales tax on construction labor for commercial projects, effective Oct. 1, 2007. It also granted a new sales tax exemption for community based wind-energy projects. It also increased the current tax credit for renewable energy projects slightly and eliminated the one megawatt capacity requirement to make the credit available for more projects.

Finally, LB 367 terminated the Nebraska estate tax for decedents dying on or after Jan. 1, 2007.

LB 502 - Increased the inheritance exemption amounts for all three classes of beneficiaries. The exemption amount for close relatives (siblings and lineal relatives) was increased from $10,000 per beneficiary to $40,000. The tax rate on close relatives remained 1%.

For more distant relatives, the exemption amount was increased from $2,000 to $15,000. LB 502 also provided that all inheritances over $15,000 be taxed at 13 percent. Previously, there were two brackets. Inherited property with a value from $2,000-$60,000 were taxed at 6%, and inheritances greater than $60,000 were taxed at 9%.

For non-relatives, there was previously an exemption for inheritances with a value of $500 or less. LB 502 increased the exemption amount to $10,000 and provided that inheritances in excess of $10,000 be taxed at 18%. Previously there were five tax brackets maximizing at 18% for inheritances greater than $50,000.

The bill also provided a 5% per month penalty for failure to file a return within 12 months of the date of death. The penalty was capped at 25%. These changes will be operative for property passing from decedents dying on or after Jan. 1, 2008.

LB 551 - Amended several sections of the Convention Center Facility Financing Assistance Act to significantly change the way state assistance is provided to convention centers under the act. The only beneficiary of the act at this time is the Qwest Center in Omaha.

Previously, the act required a board, with the assistance of the Department of Revenue, to calculate the increased economic activity due to new conventions attended mostly by out-of-state attendees. Seventy percent of the attributable revenue was returned to the public entity that built the facility and 30% was distributed to the Local Civic, Cultural, and Convention Center Financing Fund to provide grants for other cities seeking to build facilities.

Under LB 551, the amount of state financial assistance will be 70% of state sales tax revenue collected by retailers doing business at such facilities. LB 551 also added publicly-owned sports arena facilities and hotels to the act so that the state financial assistance includes sales tax revenue collected in all three facilities.

LB 551 requires 10% of any financial assistance received by a city of the metropolitan class to be distributed equally to areas of high poverty, defined using census bureau statistics to showcase important historical aspects of each such area.