NE Code § 10-401 (2021)
2021 Nebraska Revised Statutes|Chapter 10 - Bonds|10-401 - County and city bonds; issuance; conditions; limitations.

10-401.  County and city bonds; issuance; conditions; limitations.Any county or city in the State of Nebraska is hereby authorized to issue bonds to aid in the construction of any railroad or other work of internal improvement in an amount to be determined by the county board of such county or the city council of such city not exceeding three and five-tenths percent of the taxable valuation of all taxable property in the county or city. The county board or city council shall first submit the question of the issuing of such bonds to a vote of the legal voters of the county or city in the manner provided by law for submitting to the people of a county the question of borrowing money.Source   Laws 1869, § 1, p. 92;   R.S.1913, § 405;   C.S.1922, § 322;   C.S.1929, § 11-401;   R.S.1943, § 10-401;   Laws 1979, LB 187, § 18;   Laws 1992, LB 719A, § 16. Annotations  1. Constitutionality 2. Internal improvements 3. Submission of proposition 4. Issuance of bonds 5. Limitation on amount 6. Miscellaneous 1. Constitutionality Act constituting this article sustained as constitutional. Colburn v. McDonald, 72 Neb. 431, 100 N.W. 961 (1904); Dawson County v. McNamar, 10 Neb. 276, 4 N.W. 991 (1880); Hollenbeck v. Hahn, 2 Neb. 377 (1871). 2. Internal improvements Beet sugar mill not grinding for toll is not work of internal improvement, and bonds cannot be issued to aid in construction. Getchell v. Benton, 30 Neb. 870, 47 N.W. 468 (1890). A bridge across a river is a work of internal improvement, and county bonds voted to erect it are valid even though entire bridge is within limits of county. State ex rel. Peterson v. Keith County, 16 Neb. 508, 20 N.W. 856 (1884). A steam gristmill is not a work of internal improvement for which bonds may be voted. State ex rel. Bowen v. Adams County, 15 Neb. 568, 20 N.W. 96 (1884). A water gristmill is a work of internal improvement for which bonds may be voted. Traver v. Merrick County, 14 Neb. 327, 15 N.W. 690 (1883). A courthouse is not a work of internal improvement under this article. Dawson County v. McNamar, 10 Neb. 276, 4 N.W. 991 (1880). Precinct may issue bonds for bridge as internal improvement. South Platte Land Co. v. Buffalo County, 7 Neb. 253 (1878). Precinct bonds may be issued to aid in building wagon bridge across river as work of internal improvement, even though builders of bridge are authorized to collect tolls. Fremont Bldg. Assn. v. Sherwin, 6 Neb. 48 (1877). What constitutes a work of internal improvement must be tested by the benefits to be derived by the public, and not by its extent or cost, and under this test a bridge across the Platte River is a work of internal improvement. Union P. Ry. Co. v. Colfax County Comrs., 4 Neb. 450 (1876). Bonds to aid on construction of irrigation canal are authorized. Date of issuance is when county parts with money and recital of date in bonds is not conclusive. Chicago, B. & Q. R. R. Co. v. Dundy County, 3 Neb. Unof. 391, 91 N.W. 554 (1902). Bonds may be issued to aid in improving the water power of a river for the purpose of propelling public gristmills as a work of internal improvement. Blair v. Cuming County, 111 U.S. 363 (1884). A steam gristmill is not a work of internal improvement. Osborne v. Adams County, 106 U.S. 181 (1882) affirmed on rehearing 109 U.S. 1 (1883). A bridge may be a work of internal improvement for which a precinct may issue bonds, notwithstanding it is to be maintained as a toll bridge. County Commissioners v. Chandler, 96 U.S. 205 (1877). Bonds may be issued as a donation to a railroad company outside of county, and even outside of state, if the purpose of the road is to give to the county a connection which is desirable with some other region. Railroad Co. v. County of Otoe, 83 U.S. 667 (1872). Bonds may be issued as a work of internal improvement to aid in construction of canals for irrigation purposes. Keith County v. Citizen's Saving & Loan Assn., 116 F. 13 (8th Cir. 1902). Statutory authorization to construct canals for irrigation and water power as works of internal improvement is not invalid on ground that a canal so constructed might be devoted primarily to private use, since aid can only be given to construction of waterworks devoted to public use. City of Kearney v. Woodruff, 115 F. 90 (8th Cir. 1902). A canal constructed for the purpose of irrigating lands in the State of Nebraska is a work of internal improvement for which a county may issue bonds, although its waters are drawn from sources outside of the state. Perkins County v. Graff, 114 F. 441 (8th Cir. 1902). Building of courthouse is not a work of internal improvement for which bonds may be issued, while building of bridges is. Lewis v. Board of County Comrs. of Sherman County, 5 F. 269 (Cir. Ct., D. Neb. 1881). 3. Submission of proposition Issuance of revenue bonds by county to defray cost of construction of interstate bridge requires affirmative approval at an election duly held. Ahern v. Richardson County, 127 Neb. 659, 256 N.W. 515 (1934). Where vote upon issuance of bonds by county to aid railroad is induced by false representations of ownership of railroad by another railroad, bond issue will be enjoined. Nash v. Baker, 37 Neb. 713, 56 N.W. 376 (1893). Proposition submitted must provide for levying of tax to pay principal as well as interest of bonds sought to be issued. Cook v. City of Beatrice, 32 Neb. 80, 48 N.W. 828 (1891). A city created out of a village may, prior to election of mayor and council, order an election and issue bonds through the instrumentality of village officers. State ex rel. Fremont, E. & M. V. R. R. Co. v. Babcock, 25 Neb. 709, 41 N.W. 654 (1889). Under this section, question of issuing bonds must be submitted to a vote of the legal voters. State ex rel. City of Fremont v. Babcock, 25 Neb. 500, 41 N.W. 450 (1889). 4. Issuance of bonds Bonds authorized by electors to be issued to two individuals to aid in building mill cannot be issued to a partnership having additional members. George v. Cleveland, 53 Neb. 716, 74 N.W. 266 (1898). The provisions of section 10-104 apply to bonds issued under this article. Brinkworth v. Grable, 45 Neb. 647, 63 N.W. 952 (1895). Where road is not built by donee, neither donee nor vendee is entitled to bonds. Township of Midland v. Gage County Board, 37 Neb. 582, 56 N.W. 317 (1893). Bonds issued to alternative donee are voidable only, and innocent purchaser can enforce them. North v. Platte County, 29 Neb. 447, 45 N.W. 692 (1890). Where bonds are to be issued when railroad is completed and ready for running of trains, railroad company is entitled to bonds although it fails to construct depot within specified time. Townsend v. Lamb, 14 Neb. 324, 15 N.W. 727 (1883). Bonds signed and sealed outside county may be valid. Jones v. Hurlburt, 13 Neb. 125, 13 N.W. 5 (1882). Precincts may issue bonds in aid of works of internal improvement, and remedy to enforce payment of bonds is to mandamus county commissioners to levy and collect tax. State ex rel. Chandler v. Bd. of County Comrs. of Dodge County, 10 Neb. 20, 4 N.W. 370 (1880). Bonds sought to be issued in excess of ten percent of the assessed valuation of county are invalid. Reineman v. C. C. & B. H. Ry., 7 Neb. 310 (1878). Authorization by vote to subscribe for stock in a railroad company did not empower county commissioners of county to donate bonds to railroad company. Hamlin v. Meadville, 6 Neb. 227 (1877). Bonds issued under this article without registration and certification are unenforceable. Frank v. Butler County, 139 F. 119 (8th Cir. 1905). 5. Limitation on amount Precinct may issue bonds in addition to county limit. State ex rel. A. & N. R. R. v. County Comrs. of Lancaster County, 6 Neb. 214 (1877). Bonds issued in excess of ten percent of assessed valuation are invalid, and fact that bonds were registered and stated they were issued according to law does not estop county from asserting invalidity. Dixon County v. Field, 111 U.S. 83 (1884). 6. Miscellaneous Issuance of bonds by sanitary district is not controlled by this section. Lang v. Sanitary District, 160 Neb. 754, 71 N.W.2d 608 (1955). Bonds issued by a city for waterworks which are owned by the city are not donations, and are not to be included in determining aggregate of evidences of indebtedness donated for works of internal improvements. State ex rel. City of Lincoln v. Babcock, 19 Neb. 230, 27 N.W. 98 (1886). Electors cannot delegate to commissioners power to decide between two donees. Spurck v. L. & N. W. R. R. Co., 14 Neb. 293, 15 N.W. 701 (1883); Jones v. Hurlburt, 13 Neb. 125, 13 N.W. 5 (1882). Unpaid interest not figured in aggregate. Jones v. Hurlburt, 13 Neb. 125, 13 N.W. 5 (1882). Petition for mandamus must show particular description of works of internal improvement. State ex rel. Osborne v. Thorne, 9 Neb. 458, 4 N.W. 63 (1880). In federal court, county may be sued at law on bonds issued by precinct to aid in construction of internal improvements. Nemaha County v. Frank, 120 U.S. 41 (1887). Action at law lies in federal court against county on bonds issued by precinct, as mandamus is only granted in federal courts in aid of existing jurisdiction. Davenport v. County of Dodge, 105 U.S. 377 (1881). Bonds issued by precinct are obligations of the county, and suit thereon against county may be maintained at law in federal court. Clapp v. Otoe County, 104 F. 473 (8th Cir. 1900).