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LB 637

Adopt the Destination Nebraska Act and provide for certain taxing authority

109th Legislature (2025-2026) Introduced by Beau Ballard

Creates destination districts to fund mega-projects (>$3B, 10M visitors/year) with new taxes and bonds to attract out-of-state tourism and boost jobs.

Title printed. Carryover bill
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Bill Summary · LB 637

Legislative Bill Summary — LB 637 (Destination Nebraska Act)

Date: February 2025 (hearing notice: February 19, 2025)

Basic information

  • Bill Number: LB 637
  • Title: Adopt the Destination Nebraska Act and provide for certain taxing authority
  • Introduced: January 22, 2025
  • Committee: Revenue
  • Primary Sponsor: Senator Beau Ballard
  • Status: Notice of hearing issued for February 19, 2025
  • Principal aim: Create a framework to promote and develop large-scale destination projects that attract out-of-state visitors, with targeted economic and tax-related mechanisms.

Purpose and intent

LB 637 would establish the Destination Nebraska Act to promote the state’s general and economic welfare through the development of large, destination-driven, mixed-use projects that attract out-of-state visitors and support the tourism, entertainment, sports, and retail sectors. The act aims to generate jobs, infrastructure improvements, and new economic activity, while attracting visitors and tourism-related investment to Nebraska.

Key provisions and changes

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Establishment and scope

  • Creates the Destination Nebraska Act to govern the creation and operation of “destination districts.”

  • Repeals the original related section and amends Section 18-2103; redefines terms under the Community Development Law as necessary.

  • Destination districts

    • A destination district is a defined area created under LB 637 to host candidate development projects.
    • A district lasts 40 years and may not exceed 5,000 acres.
    • No portion of a destination district is part of a city’s corporate limits; cities/villages cannot exercise their zoning or tax powers within a district.
    • Up to two destination districts may be created statewide.

  • Eligibility and criteria

    • A project is eligible if:
    • Total new development costs exceed $3 billion; and
    • The project will attract new-to-market destinations and retail generating at least 10 million visitors per year.
    • Approval of an application establishes the district boundaries as shown on the accompanying map in the application.

  • Applications and disclosures

    • Through December 31, 2025, any person may apply to create a destination district.
    • Required components of the application include project description, total new development costs, estimated jobs, a map of the district, financing plan, and detailed supporting materials:
    • Economic impact study
    • Visitation projections and annual tracking/reporting plan
    • Unique project qualities
    • Expected return on state and local investment
    • A portion of application information related to location and sensitive details may be confidential (with certain exceptions for cost and job figures).

  • Tax and financing authorities

    • State sales and use taxes within a destination district on property owned by the destination district applicant would be governed under the act; the Department of Economic Development would set the rate of an occupation tax within the district to further the act’s purposes, collected similarly to existing sales taxes.
    • The destination district applicant would have the power to issue bonds, with certain obligations described as part of the act (bonds may be treated as state obligations under the act).

Who is affected

  • Destination district applicants (developers/consortiums proposing multi-billion-dollar projects)
  • Nebraska Department of Economic Development (administrative and evaluative role)
  • Local governments within or adjacent to planned destination districts (limited authority within district boundaries)
  • State and local tax revenue streams within destination districts (new tax authority and potential revenue implications)
  • General public and out-of-state visitors (potential tourism, entertainment, and economic activity)

Timeline and procedural notes

  • Introduced: January 22, 2025
  • Referred to Committee: January 24, 2025
  • Hearing: February 19, 2025 (Notice of hearing issued February 11, 2025)

Potential impacts and considerations

  • Substantial project scale: Eligibility requires >$3B in new development and >10M annual visitors, indicating a focus on mega-projects.
  • Two-district cap and non-surgical taxes: Limits on number of districts and restrictions on city taxes/zoning within districts aim to protect existing municipal authorities outside the district.
  • Financing provisions: Bonds and occupation taxes could shift significant financing and revenue dynamics to support district projects.
  • Transparency vs. confidentiality: Application materials include confidential elements, balancing investor confidentiality with public disclosure needs.
  • Economic outcomes: If enacted, could catalyze large-scale tourism, entertainment, and sports developments and create substantial employment opportunities, with corresponding state and local fiscal effects.

Compiled from official sources — confirm details with the bill’s official record.

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