The City of Omaha has released an independent study evaluating its tax increment financing (TIF) program, following concerns raised by Nebraska State Auditor Mike Foley. Foley previously expressed worries to state lawmakers about the rapid expansion of TIF-funded projects across Nebraska.
Currently, Omaha has several developments backed by TIF. Since 2015, the city has approved 196 TIF applications.
Mayor Stothert Defends Omaha’s TIF Program
Omaha Mayor Jean Stothert said the study confirms that the city’s TIF program is on solid footing.
“After Auditor Foley released his report, I met with him and his team,” Stothert said. “He found nothing to suggest that Omaha was misusing TIF.”
The review, released Tuesday, highlighted the city’s “strong system of checks and balances,” according to the mayor.
“Omaha’s TIF process is well-vetted, ensuring that only qualified projects get approved,” she said.
Stothert emphasized that TIF does not create debt for the city.
“The city is not the lender, and there is no risk for taxpayers with the way we use TIF in Omaha,” she said.
In 2023, Omaha approved $584 million for TIF projects, leading to $4.6 billion in new investments, according to the mayor.
“These developments would not happen without TIF,” Stothert added.
Concerns About TIF Spending in North Omaha
Despite the positive review, some question how TIF funds are being distributed.
North Omaha, considered a blighted area, remains in need of significant development. While TIF dollars have been allocated to projects in the area—such as Habitat for Humanity’s Bluestem development, which replaced an abandoned apartment complex with affordable housing—some argue that the funding is not being used equitably.
For example, the $70 million North End Teleservices project at 24th and Lake streets has drawn comparisons to other developments receiving TIF support.
Terri Sanders, publisher of the Omaha Star Newspaper, is working on a new office and museum project. She said city officials told her it could qualify for TIF funding, but the application process is lengthy, which may delay projects like hers.
Forvis Mazars Study Findings
The accounting firm Forvis Mazars conducted the TIF review, selecting five projects from 2022 and 2023 for evaluation:
- AkSarBen Keys Apartments (2022) – Redevelopment at 64th and Cedar streets
- Blackstone East (2022) – Redevelopment at 37th and Farnam streets
- Project Beacon (2022) – Mutual of Omaha’s new headquarters at 215 S. 15th St.
- Digs Apartments Mason (2023) – Redevelopment at 3066 Mason St.
- Square Apartments (2023) – Redevelopment at 30th and Leavenworth streets
The $20,000 study reviewed the cost-benefit analysis of each project and how the city determines blighted areas.
Forvis Mazars found that Omaha submitted all required annual updates on time to state, city, and county officials. Additionally, a review of eight completed TIF projects showed full compliance.
However, the study recommended updating internal procedures to ensure better document availability and tax monitoring notifications to the county assessor when TIF-related bonds and loans are paid off. The mayor’s office said some of these updates were already underway during the review.
