Nebraska Revised Statute 17-534
Chapter 17 Section 534
Waterworks; purchase or construction; bonds; interest; limitation; tax; approval of electors required; exception.
(1) Cities of the second class and villages may borrow money or issue bonds in an amount not to exceed twelve percent of the taxable valuation of all the taxable property within such city or village according to the most recent assessment for the purchase of fire-extinguishing apparatus and for the purchase, construction, and maintenance of such waterworks, mains, portion, or extension of any system of waterworks or water supply or to pay for water furnished such city or village under contract, when authorized as is provided for by subsection (3) of this section.
(2) Such cities or villages may levy and collect a general tax in the same manner as other municipal taxes are levied and collected in an amount sufficient to pay the interest and principal of the bonds referred to in subsections (1) and (3) of this section, as the same mature, upon the taxable value of all the taxable property within such city or village, in addition to the sum authorized to be levied under section 17-506. All taxes raised by such a levy shall be retained in a fund known as the water fund.
(3) No money shall be borrowed or bonds issued as referred to in subsections (1) and (2) of this section unless authorized by a majority of the legal voters of such city or village voting on the proposition at an election held for that purpose. Notice of the election shall be given by publication in a legal newspaper in or of general circulation in such city or village for at least two weeks prior to the date of such election. The requirement of this section of a vote of the electors shall not apply when the proceeds of the bonds will be used solely for the maintenance, extension, improvement, or enlargement of any existing system of waterworks or water supply owned by the city or village and the bonds have been ordered issued by a vote of not less than three-fourths of all the city council or village board of trustees as the case may be. The bonds shall be the bonds of such city or village and be called water bonds. The bonds shall become due in not to exceed forty years from the date of issue and shall draw interest payable semiannually or annually.
- Laws 1881, c. 23, § 8, XV, p. 177;
- Laws 1885, c. 20, § 1, XV, p. 168;
- Laws 1887, c. 20, § 1, XV, p. 296;
- Laws 1893, c. 8, § 1, p. 134;
- Laws 1903, c. 21, § 1, p. 250;
- Laws 1905, c. 30, § 1, p. 257;
- Laws 1907, c. 17, § 1, p. 127;
- R.S.1913, § 5119;
- Laws 1917, c. 103, § 1, p. 271;
- Laws 1919, c. 48, § 1, p. 138;
- Laws 1919, c. 52, § 1, p. 151;
- Laws 1919, c. 46, § 2, p. 132;
- C.S.1922, § 4292;
- Laws 1925, c. 41, § 1, p. 158;
- C.S.1929, § 17-441;
- Laws 1935, c. 34, § 1, p. 142;
- C.S.Supp.,1941, § 17-441;
- R.S.1943, § 17-534;
- Laws 1945, c. 30, § 1, p. 147;
- Laws 1949, c. 24, § 1, p. 96;
- Laws 1955, c. 50, § 1, p. 169;
- Laws 1969, c. 51, § 47, p. 301;
- Laws 1971, LB 83, § 1;
- Laws 1971, LB 982, § 1;
- Laws 1979, LB 187, § 53;
- Laws 1992, LB 719A, § 54;
- Laws 2017, LB133, § 160.
- Effective Date: August 24, 2017
1. Issuance of bonds
2. Levy of tax
1. Issuance of bonds
City has no power to issue bonds except as expressly authorized by statute. State ex rel. City of O'Neill v. Marsh, 121 Neb. 841, 238 N.W. 760 (1931).
Where council called bond election by resolution, rather than by ordinance, and where the resolution provided the election should be held at "the regular polling places in the city", such notice was sufficient as to the location of the polling place. State ex rel. City of O'Neill v. Marsh, 106 Neb. 547, 184 N.W. 135 (1921); Hurd v. City of Fairbury, 87 Neb. 745, 128 N.W. 638 (1910).
Where municipality voted bonds and entered into contract for sale thereof in strict conformity with the statute, and, before the bonds were issued, the Legislature by statute changed the terms of such bonds, the validity of the bonds issued containing the terms as so voted is not affected. State ex rel. City of Seward v. Marsh, 104 Neb. 159, 176 N.W. 92 (1920).
Bonds must be issued in conformity with the statute at the time of their issuance. Morgan v. City of Falls City, 103 Neb. 795, 174 N.W. 421 (1919).
A resolution for submission and notice of election duly passed by council providing "for the purpose of purchasing or erecting, constructing, etc.," of a system of waterworks will not be enjoined as submitting two alternative propositions to the voters. Hurd v. City of Fairbury, 87 Neb. 745, 128 N.W. 638 (1910).
Cities cannot issue bonds to aid private parties in construction of waterworks. Village of Grant v. Sherrill, 71 Neb. 219, 98 N.W. 681 (1904).
A notice for a bond election, published in each issue of a paper for five weeks, is sufficient although the first publication was only thirty-two days before such election. State ex rel. Village of Genoa v. Weston, 67 Neb. 385, 93 N.W. 728 (1903).
Valuation, as fixed by last preceding assessment, on the date when proposition for issuance of bonds is submitted to voters, fixes the maximum amount of bonds authorized to be issued. Chicago, B. & Q. Ry. Co. v. Village of Wilber, 63 Neb. 624, 88 N.W. 660 (1902).
Council of municipality by ordinance has no power to bind the city by the issuance of bonds and guaranteeing their payment beyond the authority expressly given by statute, and such statute should be strictly followed. Painter v. City of Norfolk, 62 Neb. 330, 87 N.W. 31 (1901).
The right to issue water bonds is limited by the assessed valuation as of the date of election thereon. State ex rel. City of Sutton v. Babcock, 24 Neb. 640, 39 N.W. 783 (1888).
Proposition to vote waterworks bonds may be submitted by resolution. State ex rel. City of York v. Babcock, 20 Neb. 522, 31 N.W. 8 (1886).
2. Levy of tax
Powers to levy a tax may be implied from the express power given to incur an obligation where the Legislature must have intended a tax to furnish payments therefrom. Union Pacific R. R. Co. v. Heuer, 97 Neb. 436, 150 N.W. 259 (1914).
City authorities will not be required by mandamus to levy tax for water supply in excess of limit existing at time contract is entered into. State ex rel. Young v. Royse, 71 Neb. 1, 98 N.W. 459 (1904); State ex rel. Young v. Royse, 3 Neb. Unof. 262, 91 N.W. 559 (1902).
Where a village fails to comply with the requirements essential to borrow money, such borrowing is illegal and void; yet, if the money is retained and subsequently devoted to legitimate municipal purposes, the municipality is liable therefor upon an implied contract, unless barred by statute of limitations. Nebraska State Bank Liquidation Assn. v. Village of Burton, 134 Neb. 623, 279 N.W. 319 (1938).