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The Omaha City Council adjourned well after sunset Tuesday evening, as testifiers turned out for public hearings on funding for the streetcar project and the proposed affordable housing action plan. 

Streetcar Bonds

Despite multiple requests by Council President Pete Festersen to keep remarks brief, discussion on bonds to fund the streetcar system took more than three hours. The vote is scheduled for next week.

The ordinances would authorize up to $80 million in lease-purchase bonds—which are backed by the city’s general fund—to purchase the city’s streetcars, and $360 million in redevelopment bonds—which are backed by a bank—to cover the entire cost of the project. 

Mayor Jean Stothert previously said the streetcar would be funded without taxpayer dollars, but the use of lease-purchase bonds puts more risk on taxpayers. Stothert said Tuesday that she will not need to raise taxes.

“Lease-purchase bonds will not raise taxes and would actually save the project money, which is our responsibility to be fiscally conservative,” Stothert said.

The city plans to pay back the bonds using proceeds from tax-increment financing (TIF) projects within a redevelopment district surrounding the streetcar route. A third-party analysis by MuniCap released Tuesday estimated that the redevelopment area will generate $600 million in TIF revenues through 2057—more than enough to pay back the bonds. 

Omaha Streetcar Authority President Jay Noddle said the lease-purchase bonds are being pursued because they come at a more attractive interest rate, estimated at about 4.5%. With rates for redevelopment bonds estimated at 7%, Noddle said the city would save $36.7 million on interest expenses.

“Development is perpetual,” Noddle said. “So as time goes on, the available revenue from TIF proceeds in the core is a constant…Any structure that we can employ to reduce project costs at the beginning is gonna be accretive all the way through.”

Former Mayor Hal Daub—who pushed for a streetcar during his time as mayor—spoke as a proponent Tuesday. He said the streetcar is a perfect use for TIF.

“Over time, this idea has been kicked around and it’s matured,” Daub said. “So my brief comment now is to simply say, just as a famous Nebraskan has said, git ‘r’ done.”

Thomas Rubin, an Omaha native who currently works as a transportation consultant in California, raised concerns about the financial impact of the project. He said MuniCap’s analysis was based on assumptions, and there’s no guarantee that the development necessary for TIF proceeds will happen.

“My problem is not with what [MuniCap] did, it’s what should have been done,” Rubin said. “Not necessarily by them, but it should have been done, and was never asked for because the streetcar proponents—in my opinion—don’t want to raise those questions.”

The Metropolitan Utilities District also opposed the project because of potential increases in costs for improving water infrastructure. MUD general counsel Mark Mendenhall said water mains along the route would need to be moved, costing up to $20 million.

Mendenhall said the project could prompt MUD to raise the water rate 18 to 19%, on top of any other increases necessary. He said MUD has been in contact with the Mayor’s office to discuss minimizing costs.

“We’re moving crews from the rest of the city of Omaha…to address this issue in this small area,” Mendenhall said. “It is possible, but not without a cost.”

Festersen said he wanted the MuniCap analysis to be available before Tuesday morning, but the report shows they’re confident. He also said there was discomfort on the Council that the streetcar design is only 30% complete, but the city’s agreement with Mutual of Omaha for their new downtown headquarters requires a “good faith effort” on the streetcar.

“The items we have before us today are likely the City Council’s last approval needed for this project going forward…so I think it’s important to talk about all these items in a public way,” Festersen said. 

Councilmember Brinker Harding said he was more confident after seeing the MuniCap analysis. There have been calls throughout the process to slow things down, which Harding said the city has done.

“We’ve found a way to really lower the cost of the project,” Harding said. “If we didn’t hit the brakes…I think we would be questioning ourselves.”

Noddle said that the excess funds could be used to extend the route to connect North and South Omaha. He also said there have been discussions with Council Bluffs leaders on extending the streetcar over the river.

Housing Affordability Action Plan

The City Council voted to delay the final vote on Omaha’s Housing Affordability Action Plan (HAAP) until next week. Councilmember Harding said he wanted to give citizens who had to leave the longrunning meeting early a chance to testify on the issue.

In 2020, the Nebraska Legislature passed a bill requiring cities to create an affordable housing action plan by 2023. Omaha contracted planning and design firm RDG to help draft the plan.

Amy Haase from RDG said HAAP provides a snapshot of the current state of housing, assesses residents’ concerns, and explores strategies for addressing them. She said Omaha has not been meeting housing demand, and input from the public made clear that there are obstacles to finding housing for many residents.

Greg Paskach from city planning said the plan’s goals include prioritizing funding for developments including missing middle housing or mixed income, creating a development fund for affordable housing, and revising zoning ordinances. The plan recommends strategies like transferring lots to the land bank and working with organizations that serve small and disadvantaged businesses to reach local contractors and developers

Representatives from nonprofits like One Omaha and Together Omaha spoke as proponents to the plan. Tracy McPherson from Habitat for Humanity of Omaha said the plan’s recommendations would help Habitat achieve their goals.

“The passing of the plan is not the end of the work, to me it feels like the beginning,” McPherson said. 

Erin Feichtinger from the Women’s Fund of Omaha said that housing instability disproportionately impacts women. She said women account for about 75% of housing assistance vouchers and women—especially Black women—are evicted at a higher rate.

Feichtinger also said housing instability was a “cause and consequence” of domestic violence. She said 80% of homeless women with children have experienced domestic violence and around 57% of homeless women reported domestic violence as the cause of their homelessness.

“A severe lack of options for housing paired with a lack of intentional and meaningful protections and investment in housing stability means that some of the most vulnerable yet resilient people in our community will continue to feel trapped in a dangerous cycle of poverty and abuse,” Feichtinger said.

Opponents, many of whom were landlords, said some of the plan’s recommendations could have unintended consequences. Rick McDonald, President of the Metropolitan Omaha Property Owners Association, said measures like rent control make housing less affordable.

“Rent controls have never worked in history, ever,” McDonald said. “If you think rents are getting high, if you look at it, our costs are going up huge.”

Opponent Pierce Carpenter said the plan is a “wishlist for all of the tenant advocacy groups.” He said landlords need to be involved in any decisions.

“I think [HAAP] could’ve been written in a much more friendly way and taken into consideration things that work and things that don’t work,” Carpenter said.

The City Council also approved the legislative package for the state legislature’s upcoming session. Proposals include a bill to allow the city to charge a fee on telecommunications companies using the right-of-way like Google Fiber, and an increase in penalties for drug-induced homicides.

County Board

The Douglas County Board met to approve a 5% wage increase for non-union county employees for the 2023 calendar year. Commissioner PJ Morgan said the increase will help maintain staffing.

The Board also approved $125,000 from the American Rescue Plan Act to help fund Boys Town’s Day School and Metro Intervention Center programs. Boys Town President Father Steven Boes said the money will help them reach more youth in the area.

“School districts are asking for our help everyday to help more students,” Boes said.


Subscribe to The Reader Newsletter

Our awesome email newsletter briefing tells you everything you need to know about what’s going on in Omaha. Delivered to your inbox every day at 11:00am.

Become a Supporting Member

Subscribe to thereader.com and become a supporting member to keep locally owned news alive. We need to pay writers, so you can read even more. We won’t waste your time, our news will focus, as it always has, on the stories other media miss and a cultural community — from arts to foods to local independent business — that defines us. Please support your locally-owned news media by becoming a member today.

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