This story is part of (DIS)Invested — a longterm Reader investigation into Omaha’s inequities.
“They’re pushing dirt out west, to build a greater Omaha.”
The canary yellow Ford sailed down Center Street in the twilight of a Midwest winter.
Louis Sanders leaned into the ‘64 Galaxie 500’s upholstery and watched the mother of his children handle the steering wheel.
The couple was driving home after visiting friends in the southwestern suburbs of Omaha. That’s when red and blue lights flashed behind them.
“What’s the matter, officer?” Sanders, now 80, remembers asking in the mid ‘60s as he rolled down the passenger-side window.
The officer looked inside the car and turned to yell at his partner.
The officer jerked him from the car and Sanders punched him in the nose before eight more squad cars arrived. As Sanders sat handcuffed, the first officer smacked him in the face with his club.
Although Sanders said the charges against him for assaulting a police officer were dropped in the story he told The Reader, he knew his real offense. He was Black in a white neighborhood. Now, more than half a century later, Sanders can’t say the social codes in Omaha are much different.
“Things have changed to some amount. But I don’t know if they’re better,” he said. “[Racism] has a way of hiding.”
The racism that existed in plain sight in the 1960s did not disappear. It became embedded in many social and governmental systems, including the way cities grew. In Omaha that’s meant a push westward, fueled by government-subsidized development that has cost taxpayers half a billion dollars in the last 20 years, according to debt figures from Nebraska’s Auditor of Public Accounts, and contributed to creating two very different cities.
In most areas east of 42nd Street, children growing up face low or very low likelihoods of getting good educations, jobs and incomes, according to data collected by Brandeis University. If you drive to western suburbs, more kids read at higher levels, have better access to nutritious food, graduate high school and go on to high-skill employment.
The divisions look the same as the city’s concentrations of race and poverty, which look the same as federal maps drawn in the 1930s to deny people of color from obtaining home loans. Today people of color in Douglas and Sarpy counties are still more than twice as likely to be denied a home loan, according to federal data.
And because owning a home is one of the most important ways people in America build wealth, the trend has prohibited many from breaking cycles of generational poverty. Meanwhile, Omaha’s 80,000-unit deficit of affordable housing means many are stuck in a tight rental market, paying too much for often substandard, unsafe housing concentrated in low-income neighborhoods.
“How can we look at that past and then look at the current state of things and not think that there’s not some kind of responsibility to address those issues?” asked Meridith Dillon, executive director of a new housing advocacy organization, Front Porch Investments. “It’s not just the past. It impacts the present.”
Identifying the problems isn’t hard. Omaha has done it repeatedly for years.
In 1965, a local television reporter introduced “urban renewal” to viewers — a new way for Omaha to reinvest in declining neighborhoods on the east side.
“I feel whenever you have a need that is so massive and so vast as blight in a whole community, you need some agency like the government to take it over,” Urban League of Nebraska executive director Nelson Nichols Jr. said at the time. “It’s a little too big for private enterprise.”
In Omaha’s Master Plan, passed in 1993, the city lists expanding affordable housing as a primary issue, especially among low-income renters. Meanwhile, it became relatively cheaper for richer Omahans to move westward. In years to come, reports credited the pattern with holding the city back from attracting young professionals and new businesses as well as furthering racial inequity. What the city should do, the master plan said, is establish compact growth, prevent new strip office/commercial development and reverse deterioration in the central part of the city. The Omaha City Planning Department did not return requests to comment for this story.
In 2020, a private report financed by Omaha’s biggest nonprofits identified almost the same issues in housing. Now, another city report on affordable housing is in the works, a new requirement under state law.
For state Sen. Justin Wayne of District 13, who helped pass that law, as well as others to promote equitable development, better housing means better jobs, schools and futures for a state facing serious workforce issues.
But like many before him, he’s seen little change.
“There's no ownership for housing,” said Wayne, who plans to introduce a bill this legislative session to create a state housing director. “The key to doing anything in governance is somebody has to be in charge of it. It has to be their responsibility, so in 10 years, if housing isn't getting any different, then it’s that person's fault.”
The other key to change: money.
Coincidentally, Nebraska has a lot to spend — about $1 billion (plus about $112 million in Omaha and $111 million in Douglas County) from the American Rescue Plan Act (ARPA). The federal money, which must be spent by 2026, can be used for everything from fighting the pandemic to strengthening infrastructure.
For people like Louis Sanders, the trends, politics and money can become noise. What’s easy to understand is the feeling that the end product has hardly changed.
“The city has been discriminating on housing for a long, long time,” he said. “That stigma is still in a lot of people’s minds I think.”
A City Takes Shape
Marshawn Ford-Rush knew she’d have to talk about race with her kids at some point. She just never imagined it’d have to be at Girl Scouts.
“I’m so sorry my daughter said that,” Ford-Rush remembered a mother telling her at a meeting about a decade ago when her daughter was in kindergarten.
“What’d she say?”
“That she didn’t like her because she was Black.”
Since her children were babies, Ford-Rush’s one goal has been to give them the best education Omaha has to offer. That meant hours of research and moving from rental home to rental home in more expensive areas, sometimes picking up trash on the property for cheaper rent, so her family could go to the best schools. But it’s come at a price.
Ford-Rush said all of her kids have experienced racism.
“Is it fair to those kids?” she wondered. “I didn't walk the walk. I didn't walk the halls. I wasn't the one being slandered. I'm just the one fighting for [my kids]. So if you ask me, ‘Why do I put my kids through that?’ Well why should they be denied? Because of the color of their skin? No. We gon’ be there. But that's not taking into account the fight.”
The inequities faced by families like Ford-Rush’s are spurred by development that’s spread resources thin and divided Omaha. Arguably the most impactful tool has been sanitary and improvement districts (SIDs), according to Creighton Law Professor Palma Strand.
A unique taxpayer-subsidized development tool, SIDs have been described as a “ponzi scheme,” and were once the reason Nebraska led the nation in Chapter 9 bankruptcies, according to a 2012 article in the Lincoln Journal-Star. A 1975 University of Nebraska at Omaha report found SIDs swelled Omaha’s debt four times faster than the 42 largest American cities. State Sen. Justin Wayne calls them “a joke.”
To many others, SIDs represent everything from realizing the American dream to turning farmland into profit.
“Nearly every developer agreed that without SIDs there would have been little or no growth west of Omaha's 72nd Street,” the UNO report reads.
Following World War II, white Omahans left the city for new, spacious neighborhoods outside city limits. Many developments used patchwork systems of wells and septic tanks as Omaha couldn’t afford to extend water and sewage lines.
In 1949, state laws were introduced allowing developers to create small governmental bodies that can use tax-exempt financing to build quality infrastructure while levying taxes among residents. Eventually, many SIDs are annexed by the City of Omaha, which absorbs their land, residents and debt. According to county records, Omaha has annexed 222 SIDs since 1958, and there are currently 148 remaining in Douglas County. SIDs are also popular in Sarpy County, although Omaha is unable to annex across county lines.
The first boom in these developments took place at the same time police beat Louis Sanders in the mid-1960s, building neighborhoods inaccessible to people like him. Between 1938 and 1964, the United States awarded 98% of its home loans to white people, according to the Center for American Progress. Suburbanization also stretched city services thinner, economically starved urban centers and required new forms of transportation. Omaha’s streetcar system, once one of the most robust in the country, dwindled into nonexistence. Highways were built by razing homes, businesses and churches in many minority neighborhoods.
“They destroyed a community and a neighborhood,” Manne Cook, a former city planner and transit advocate from North Omaha told The Reader in 2021.
Meanwhile, someone had to pay for the westward development aided by SIDs, and much of that fell on the very people left behind.
“They were subsidizing, through their tax dollars, developments that they legally could not have access to,” Strand said of people of color whose tax dollars helped pay off annexation debt.
Many of these trends continue to this day. White people still get 10.6 times the loan amounts of people of color in Douglas and Sarpy counties, a difference of more than $31 million, according to federal data from 2007 to 2017. Other factors — availability of jobs, reliable transportation, generational poverty and more — compound to exacerbate challenges. Today white people are about twice as likely to be homeowners than Black people in Douglas County, although homeownership has fallen across demographics in the last decade.
Despite all this, the American dream is not dead for many. When Marshawn Ford-Rush imagines success, for her it’s owning a home. She and her husband never reached that, but now her kids can.
“Me and my husband never had money or learned how to budget a checkbook,” she said. “You just enter into it blindly trying to make it. We never had any credit. We never had a savings account … I love that my kids are in a position where they could buy a house in a couple years if they wanted to. I mean, it's crazy. That would be the greatest win for me. No more running around.”
‘A drop in a drop in a drop in a bucket’
More than a quarter of Omahans pay more than 30% of their income on rent or a mortgage, according to a 2020 report released by several area nonprofits. That means they are housing cost-burdened by definition of the Department of Housing and Urban Development. In poor areas the effects are even worse, and often people find it difficult, if not impossible, to find better options.
In 2018, the City of Omaha identified about 2,000 code violations at one North Omaha apartment complex, including gas leaks, bed bugs, leaking ceilings and mold. But as former Omaha City Councilmember Ben Gray put it, it was “only the tip of the iceberg” as code violations run rampant, especially in East Omaha, and take longer than a year on average for the city to fix. The issue was once again highlighted when the city shut down an apartment complex near 25th and Jones Streets in January, displacing dozens of people.
Joe Garcia, the director of the Fair Housing Center within Family Housing Advisory Services, an organization dedicated to improving housing opportunities and eliminating poverty, has investigated housing discrimination since 2001. He said he and his staff of six people investigated 270 cases last year, mostly involving people with disabilities.
Garcia said his office is also responsible for ensuring fair housing for people across Nebraska and Iowa with cases spanning from Chadron to Cedar Rapids. In Omaha, residents can also call the city’s Department of Human Rights and Relations. But Garcia’s authority is limited.
“I'll [tell people I’m investigating] I'm the program director for the Fair Housing Center of Nebraska and Iowa, but the bottom line is, ‘So what?’” he said. “Joe Garcia ain’t diddly because he don’t got no authority. What Joe Garcia does have is the fair housing law behind him. That puts a little more clout behind what we do. But the bottom line is, Joe Garcia don’t mean squat.”
Many say to address the inequitable way Omaha’s been set up, the city needs stronger oversight and intention, especially around development.
That leadership could help implement viable solutions, such as Missing Middle Housing, which allows for the construction of additional units on existing single-family homes, aiming to increase density and affordability. No such units have been built since city code was changed to allow them in 2020, according to Grace Thomas, an advocate with the Omaha Missing Middle Housing Campaign.
Many see the city in a state of arrested development. Meredith Dillon spent the mid-2010s in the Omaha City Planning Department helping produce a 678-page report on housing inequity. A few years later she helped lead a similar report that highlighted many of the same issues.
Omaha City Council President Pete Festersen thinks the city has more than enough information to take big steps forward.
“I do think we have a big opportunity right now to really move the bar on that issue,” he said. “And we shouldn't wait for the comprehensive plan to be done. The opportunity has presented itself. I think it needs to have some urgency and should be a priority.”
Federal COVID-19 relief funds provide the best opportunity to accomplish that, said Jamie Berglund, executive director of the grassroots advocacy group Spark CDI, which focuses on routing investment to disinvested communities. Because while groups like hers have, or are building, funds to combat historically inequitable housing trends, they can’t compete with private developers.
“In real estate development, that is a drop in a drop in a drop of a bucket,” she said.
As the city, county and state decides how to spend its federal ARPA money, state Senators Justin Wayne and Terrell McKinney hope to do the same with about $245 million for housing and education in North Omaha. Berglund and Dillon said their nonprofits are among a group requesting $20 million from the city that they hope to leverage into $60 million to address area housing issues.
“This is a once-in-a-generation level of investment that's in Nebraska right now,” Berglund said. “We need to take advantage of this. If for some reason it goes to something that is not catalytic in addressing major issues, should that prevent us from still trying? Absolutely not. Like what's the alternative? We just can’t not have this conversation. We can't not act upon it.”
When Louis Sanders drives around Omaha, it’s easy to see how things have changed. The area where police beat him in the ‘60s used to be near the outskirts of town. Now 72nd Street is the city’s geographic center lined with big box retailers and fast casual restaurants. Though the city’s still highly segregated, families like Marshawn Ford-Rush’s continue pushing the boundaries just like so many have before them, making schools and neighborhoods across the city more diverse.
Other times it’s too easy to see the past. Most of the people who live in nice, new neighborhoods look the same as they did half a century ago. And you can still find homes with sagging roofs and pockmarked streets in the same places long promised “renewal.”
But something else seems to be happening. Something that tells him, maybe, things are changing for the better.
“People don’t take what they used to take,” he said. “In today’s age everybody’s fighting back.”
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