The Nebraska Highway Commission could issue up to $400 million bonds during the course of the next six years to speed completion of the state’s expressway system under a bill considered Wednesday by the Revenue Committee.
LB542, introduced by Fremont Sen. Lynne Walz, would authorize the commission, upon recommendation of the state Department of Transportation, to issue bonds between July 1, 2021, and June 30, 2027. The bonds would be paid off by June 30, 2040.
Proceeds from the sale of any bonds would be deposited in the department’s Highway Cash Fund to be used to accelerate the completion of highway construction projects under the Build Nebraska Act.
The act, passed by the Legislature in 2011, dedicates one-fourth of 1 percent of state sales tax revenue to road projects, including the expressway system, between 2013 and 2033.
Bonds authorized by LB542 would be special obligations of the state payable only from the State Highway Capital Improvement Fund and any other funds pledged by the commission for that purpose. They would not be a general obligation or debt of the state.
Walz said Nebraska’s pay-as-you-go model cannot meet its infrastructure needs, particularly in the case of the expressway system, which will consist of 600 miles of four-lane highways connecting the state’s major cities.
The project was projected to cost $200 million when the Legislature approved it in 1988, but Walz said completing just the remaining 160 miles could cost more than $500 million due to inflation and rising construction costs.
Walz said it would be incredibly financially irresponsible to wait any longer on the 30-year-old plan.
Ernest Goss, an economist at Goss & Associates and Creighton University, testified in support of the bill. Norfolk Mayor Josh Moenning also testified his support.
Moe Jamishidi, acting director of the state Department of Transportation, testified in opposition to LB542. Since 2013, he said, the department has used revenue received under the Build Nebraska Act to build or begin construction on about 45 miles of expressway.
The committee took no immediate action on the bill.
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