NEBRASKA CITY – City commissioners agreed Monday to a Nebraska City Area EDC plan intended to incentivize home construction outside the northwest edges of city limits.

The EDC hired Hanna Keelan Associates to study a substandard and blighted designation for 439 acres along Centennial Avenue and east past 62nd Road, just north of the new Franciscan Sisters of the Sorrowful Mother’s spiritual center.

 

The study says none of the 12 buildings in the study area are dilapidated, but Economic Developer Dan Mauk said a century-old house that has since been torn down can be used to qualify the whole study area as substandard and blighted. He said building on the entire 439 acres is unlikely right away, but this is the last chance to qualify the whole area for tax increment financing.

Mauk: “All this does is grab the area and protect it for use of tax increment financing in the  foreseeable future.”

The Nebraska Community Development Act provides for tax increment financing in areas that are substandard and blighted. Tax increment financing allows some investor dollars that would go typically go toward property taxes to be used for project improvements, such as streets, sidewalks and water.

The Hanna Keelan study says most of the land is substandard because it does not have city water, sewer or modern streets. The northern most segment of Arbor Drive in the Jay Valley Subdivision is paved, but has not been developed.

Mauk: “Why do we want to designate the whole area? If we don’t, we can’t in the future. If we just do the five acres, that house that was torn down, that was over 100 years old, is gone now. We can’t count it twice.”

Each of the city’s last three housing studies, over the past 20 years, show Nebraska City needs housing in every price range.

Prior to 2017, the city averaged about 4.6 new units per year and Mauk said that is far below the study’s recommended build of 13.6 units.

Mauk: “That creates some pent-up demand.”

He said new houses in Nebraska City in the range of $320,000 are selling quickly, but the front-end cost of infrastructure remains a barrier to new construction.

Nebraska City used $460,000 of American Rescue Plan funds and raised the utility franchise fee paid by utility customers to pay bonds taken out to finance street and storm sewer improvements at the Kreifels Hills housing project near the CHI Health St. Mary’s. The city’s infrastructure costs are over $2.2 million without a single lot being sold.

Mauk said those kinds of market realities are why the availability of tax increment financing is needed for the builders at the Hammond Farms area.

He said building there is not expected to compete with the city's Kreifels Hills project, where workforce housing limits sales to $325,000.

 

 

Mauk: “These would be upscale homes put out, meeting the higher end of our need, which we haven’t done a very good job of meeting.”

The substandard and blighted designation is expected to go before the Nebraska City Planning Commission and return to the city council before final approval.