OMAHA, Neb. (KMTV) — The City of Omaha is one step closer to building a streetcar.
The Omaha City Council approved $440 million worth of bonds on Tuesday with the city aiming to pay those off with new development.
$80 million of those bonds are lease-purchase bonds and will be backed by the taxpayers. Omaha Mayor Jean Stothert vowed that the streetcar project will not use taxpayer money.
The city is implementing a creative use of tax-increment financing to fund the project, with new development within three blocks of the streetcar line, in the city's urban core. The streetcar is planned to largely go along Farnam Street from Midtown to Downtown.
Councilmember Aimee Melton cited statistics from the city and argued that, with Mutual of Omaha moving Downtown, there is already guaranteed development and likely much more to come.
She doesn’t believe taxpayers will be on the hook.
“$80 million will be covered by the TIF loans and the developers because I firmly believe we will have development in downtown Omaha and it’s not going to stop,” said Melton.
The council passed the bonds 6-1, with Councilmember Juanita Johnson the lone no vote.
The $80 million bonds will likely be used to buy the cars and maintenance facility, according to Finance Director, Steve Curtis. He said the city is using those because it’ll save taxpayer money due to a better interest rate for the city.
Another major hurdle in passing these bonds was the Metropolitan Utility District said gas and water rates will go up if the streetcar is built.
At the meeting, MUD and the city said they’re going to keep working together in good faith and hope to minimize costs and possibly not raise rates at all.
MUD's General Counsel and Senior VP Mike Mendenhall said he couldn't say he was confident that rates will not go up, but said they’re having continued discussions with the city.
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