(1) Any municipality, county, or qualified public-purpose organization may lease, purchase, construct, own, maintain, operate, or contract for the operation of public transportation, including special transportation for the elderly or handicapped, and apply for and accept advances, loans, grants, contributions, and any other form of assistance from the federal government, the state, or any public or private sources for the purpose of providing a public transportation system.

Any special transportation system for the elderly or handicapped shall include transportation of necessary personal escorts of such elderly or handicapped riders.

(2) Any municipality or county in providing public transportation for the elderly under subsection (1) of this section may contract with the school board or board of education of a public school district for the use of a school bus at times other than during the normal school day or on days when school is not in session if all costs incurred by such municipality or county are paid for with money generated from passenger fees or federal or state funds. The contract shall provide that such municipality or county shall be liable for costs of maintenance, operation, insurance, and other reasonable expenses incurred in the use of such bus. No district shall be liable for any damages to any person riding in a school bus under a contract entered into pursuant to this subsection unless such damage is proximately caused by the gross negligence of the district. No district shall be required to modify or alter any school bus because of a contract entered into pursuant to this subsection. Any municipality or county when using a school bus upon a highway under a contract entered into pursuant to this subsection shall cover or conceal all school bus markings on such bus as required by section 60-6,175.

(3) Any municipality or county may contract with the school board or board of education of any public school district for the use of school buses for emergency evacuation of members of the public by qualified law enforcement personnel during emergency or crisis situations that pose a threat to the health, safety, or well-being of the individuals to be evacuated. The contract shall provide that such municipality or county shall be liable for the costs of maintenance, operation, insurance, and other reasonable expenses incurred in the use of such buses. No district shall be liable for any damages to any person riding in a school bus under a contract entered into pursuant to this subsection unless such damage is proximately caused by the gross negligence of the district. No district shall be required to modify or alter any school bus because of a contract entered into pursuant to this subsection.