By Henry J. Cordes,Henry J. Cordes World-Herald Staff Writer

Copyright omaha

The city’s plan to boost and revitalize Omaha’s urban core now includes not only building the $421 million streetcar, but also putting tens of millions of dollars into constructing affordable housing and improving bikeways.

The Omaha City Council on Tuesday voted 6-0 to formally amend the urban core plan first adopted in 2022 to authorize up to $50 million in bond funding for affordable housing and enhanced bikeways.

All those initiatives would be funded through tax-increment financing, in which the would-be increased property tax dollars generated through the redevelopment of blighted properties in the urban core can be used to fund infrastructure related to the new development.

The administration of Mayor John Ewing is pushing a companion plan to immediately put $40 million of those additional TIF funds into incentivizing construction of new affordable homes and apartments within the urban core.

The council and members of the public during a hearing Tuesday broadly supported the Ewing administration’s efforts as a small step toward meeting the severe shortage of affordable housing that has gripped both Omaha and the nation.

The $40 million will “help with the housing crisis we have and start to turn the tide on affordable housing,” said City Councilman Danny Begley.

The Urban Core Housing and Mobility Redevelopment Plan — pushed by then-Mayor Jean Stothert in March 2022 to build the modern downtown-to-midtown streetcar — always contemplated that if extra funds were available after the streetcar was built, they could pay for housing and bikeways.

But Ewing is so confident in the projections he’s seen for TIF revenue within the streetcar corridor that his administration is ready to dedicate funds now for those other uses.

The current estimates suggest there will be more than $4 billion in new commercial development over 15 years within the urban core, an area generally bounded by Cuming on the north, Woolworth on the south, 50th on the west and the Missouri River to the east.

That’s enough to generate at least $550 million in available TIF revenues, according to City Finance Department estimates.

The plan amendment approved Tuesday would authorize up to $440 million in bonds for completion of the streetcar — providing some buffer if costs continue to go up — and $50 million for bonds dedicated to housing and bikeways, such as protected bike lanes.

“We are providing for the city to have a dense development with a variety of housing opportunities as well as a variety of transportation options,” said Deputy City Attorney Jennifer Taylor.

The council will vote next week on the next step in the plan — a contract to have Omaha nonprofit Front Porch Investments immediately put $40 million of the $50 million authorized into incentivizing construction of new affordable housing. The remaining $10 million would be available for future housing or mobility projects.

The urban core plan approved Tuesday continues to give funding priority to completing the streetcar. Because of that, it’s estimated there would be no funding available for housing for nearly 10 years.

But in an effort to jump-start the affordable-housing portion of the plan, an investor has agreed to step forward to buy the $40 million in housing bonds now, to be repaid later when the additional TIF dollars become available.

City officials noted such a funding scheme puts all the risk for the housing bonds on the investor. If the TIF dollars don’t come through in the end, the investor would not be paid back.

“The taxpayers are not taking the risk for the $40 million,” said Councilwoman Aimee Melton.

That $40 million in bond proceeds would go to Front Porch Investments, a nonprofit established in 2021. Front Porch provides low-cost loans to builders that help subsidize the cost of constructing housing, making the units affordable for those at lower income levels.

Jody Holston, executive director of Front Porch, estimated the $40 million beginning next year could seed the construction of some 1,900 new housing units.

She noted that the plan to revitalize Omaha’s urban core set a goal of bringing 30,000 new residents into the heart of the city.

“This plan is a meaningful step towards that goal, while ensuring that the core is accessible to all income levels,” she said.

Several builders testified to the difference loans from Front Porch make in enabling construction of affordable housing.

“I can give you firsthand accounts of how Front Porch’s loans are the difference between deals penciling out and not,” said Rob Woodling of Omaha’s Foundations Development.

The funds could be used to build housing ranging from single-family homes to apartment complexes with hundreds of units.

While all of the new housing would have to be constructed within the urban core boundaries, Holston said having a designated urban core fund will free up existing Front Porch dollars to construct affordable units in other parts of the city, including North and South Omaha.

“We plan on balancing that,” Holston said.

She also noted that Front Porch will use existing funds to pay all costs of administering the housing plan, making sure all $40 million truly goes toward new affordable housing.

Several testifiers noted that if the city does not move quickly on affordable housing within the urban core, much of the available land could be taken up by market-rate housing.

Councilman Pete Festersen also noted that previous studies have indicated Omaha needs to develop as many as 30,000 additional affordable housing units in the next five years.

“So even though this is a great program of work, in my opinion, I think there’s a lot more we also need to be doing on affordable housing throughout the metro,” he said.