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LB 424

Limit increases in property tax bills

109th Legislature (2025-2026) Introduced by Bob Andersen and 2 co-sponsors

Cap annual property tax increases at the lower of inflation or 3%, with exceptions for improvements.

Title printed. Carryover bill
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WeVote Research Nonpartisan
Bill Summary · LB 424

Legislative Summary: LB 424 – Limit Increases in Property Tax Bills (CAP IT Act)

Quick overview

LB 424, introduced January 17, 2025, proposes the CAP IT Act to limit how much a parcel’s property tax bill can increase each year. The bill is assigned to the Revenue Committee and had a hearing notice issued for February 27, 2025. Primary sponsorship is by Senator Bob Andersen, with cosponsors Senators Conrad and Hallstrom.

Purpose and intent

  • To provide predictability and protection for Nebraska property owners against year-to-year escalation in property tax bills.
  • Establish a uniform cap on annual growth in property tax bills at the parcel level, reducing the likelihood of large, unpredictable increases.

Key provisions

Definitions (Section 1)

  • Allowable growth percentage: The lower of
    • (i) the inflation rate, or
    • (ii) 3 percent.
  • Inflation rate: The percentage change in the Consumer Price Index for All Urban Consumers (CPC-U) as published by the U.S. Bureau of Labor Statistics, for the twelve-month period ending August 31 of the year in which the tax bill is determined.
  • Property tax bill: The amount of property taxes due for a parcel of real property as shown on its tax statement.

Cap on annual increases

  • For each parcel, the property tax bill shall not exceed the prior year's bill by more than the allowable growth percentage.

Exceptions

  • The cap does not apply if the increase is due to improvements made to the parcel. Increases tied to improvements would be allowed beyond the cap.

Who/What is affected

  • Individual parcels of real property in Nebraska and their corresponding property tax bills.
  • Homeowners, farmers, businesses, and other property owners subject to Nebraska property taxes.

Procedural and timeline notes

  • Introduced: January 17, 2025.
  • Committee: Revenue.
  • Hearing: Notice of hearing for February 27, 2025.
  • Sponsors:
    • Primary: Senator Bob Andersen
    • Cosponsors: Senator Conrad, Senator Hallstrom
  • Legislative actions:
    • Referred to Revenue on January 22, 2025
    • Names added for Hallstrom (Feb 11, 2025) and Conrad (Jan 22, 2025)

Potential impacts and considerations

  • Tax bill predictability could improve budgeting for property owners by limiting annual growth to the lesser of inflation or 3%.
  • If inflation is low, the cap operates near 0–3% annually; if inflation is high, the cap may be 3%.
  • The cap could reduce year-to-year volatility in property tax bills but may affect local government revenue growth and service funding.
  • The improvement exemption creates an incentive to upgrade property, as improvements can trigger tax increases outside the cap.
  • Fiscal and administrative implications for county assessors and tax offices, including implementation of the new definitions and cap calculations.

Next steps

  • Monitor the Feb 27, 2025 hearing for committee deliberation, potential amendments, and any fiscal notes or fiscal impact statements.
  • Track floor action and any changes to definitions, scope, or effective dates as the bill moves through the Legislature.

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

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