Nebraska lawmakers hear about affordable housing needs ahead of next year's session

Blood was one of several members of the Legislature's Urban Affairs Committee who met in Omaha Monday for a public hearing about Nebraska's ongoing affordable housing problem under a resolution brought by Sen. Terrell McKinney of Omaha, the committee's chairman. 

Legislative Resolution 138 called for an interim study to examine the meaning of affordable housing in the state. McKinney said he hoped the information lawmakers gleaned from the hearing would help them draft possible legislation for next year's session. 

"It should be a priority of the state to solve this issue," McKinney said. 

McKinney has made housing one of his priorities in the Legislature. He pushed an ongoing project devoting over $400 million to underserved areas of the state, primarily in North and South Omaha. So far, the project has allocated $20 million to affordable housing developments in Omaha. 

The committee heard from developers, advocates and community members representing areas across Nebraska, who all provided a variety of explanations for the shortage of affordable housing and suggestions on how to address it. Most seemed to agree that it will likely take a mix of different efforts in order to fully solve the problem. 

While there is a lack of affordable housing across Nebraska, the reasons differ depending on the region of the state. In western Nebraska, for example, many counties are struggling to find developers to build affordable units. 

In more populous areas like Omaha and Lincoln, however, there's no shortage of developers — but the rents are higher than many residents can afford. Buey Ray Tut, CEO of the nonprofit Spark, said roughly 55,000 Omaha households spend more than 30% of their income on housing. Lincoln has 21,000 such households.

In his North Omaha district, McKinney said, there are few affordable housing options because the rent is above the area's median income. 

"Affordable is only affordable if you can afford it," he said. 

For Erin Feichtinger, policy director of the Women's Fund of Omaha, the housing situation in Omaha has gone beyond a crisis. In Douglas County, eviction rates are set to surpass the county's numbers prior to the COVID-19 pandemic, she said, with the most frequent tenants in evictions court coming from McKinney's district. Federal dollars for emergency rental assistance is running out, contributing to the rise in evictions.

Several developers spoke of a range of market issues that make constructing affordable housing units difficult, including rising interest rates, inflation and shortages of building supplies. This both discourages developers from traveling to rural areas for projects, and causes them to raise rents on existing projects in order to make them profitable. 

"Essentially, if it doesn't make cents, it doesn't make sense," said Realtor Angel Starks.

Blood expressed concern that property intended for affordable housing is being bought by high- or middle-income residents. She indicated that this could be an issue lawmakers could try to prevent. 

McKinney encouraged lawmakers and other attendees to seek creative solutions. And in North Omaha, he said, he would rather slow development of apartment complexes and instead focus on increasing home ownership. 

People who spoke at the hearing also suggested a variety of ways state and local officials could contribute to the solution, including lowering property taxes, removing outdated zoning barriers and ensuring that affordable housing units are well-maintained. 

"We have to look at (affordable housing) as not just an issue to throw dollars at to solve," McKinney said.