The Omaha City Council recently approved the placement of a $333.4 million general obligation bond referendum on the upcoming general election ballot. The funds from this bond will be allocated to various critical areas such as sewer construction and improvements, streets and parking, public safety and convention center facilities, parks and recreation, highways and bridges, and police and firefighting equipment as part of the city’s strategic capital planning process for the next four to five years. According to Omaha Finance Director Stephen Curtiss, the city’s draft $3.1 billion capital improvement program for 2025 to 2030 includes approximately 70 projects, with at least four of them being new additions compared to the previous year’s $2.7 billion program.
The Capital Improvement Program (CIP) outlines that about 60% of the revenue sources come from the sewer revenue improvement fund, while 24% will be sourced from the general obligation bonds. The program also estimates that an average of approximately $122.28 million in general obligation bonds will need to be issued each year to cover the anticipated expenditures for capital improvements during the period of 2025-2030. The breakdown of the bond dollars indicates that about 58% will be dedicated to transportation improvements, while the remaining funds will be allocated to public facilities, environment, parks and recreation, and public safety.
Omaha has a history of periodically approving general obligation bond measures for capital improvements, with the most recent one in May 2022 authorizing $260.3 million. In addition to the GO bonds, the City Council also held a public hearing on $50 million of special tax revenue redevelopment bonds supported by a community redevelopment tax that does not require voter approval. These bonds have a maximum levy of 2.6 cents without imposing any new taxes on the residents. The proposed ordinance for the revenue redevelopment bonds aims to create a community development agency as part of the city’s redevelopment initiatives, particularly focusing on the Urban Core project.
Omaha faces challenges related to its physical expansion limits, with natural barriers and existing developments constraining the city’s ability to grow through annexation. The strategic plan for Urban Core highlights a decline in downtown job opportunities since 1963 and predicts a shortage of developable land by 2040 on the suburban outskirts. The city’s planning department anticipates a slowdown in growth through annexation by the mid-2050s, emphasizing the need for internal growth through the revitalization and redevelopment of the urban center.
In recent years, Omaha has successfully issued various purpose bonds and special tax revenue bonds to fund critical projects and initiatives. Moody’s Ratings and S&P Global Ratings have assigned favorable ratings to these bond issuances, reflecting confidence in the city’s financial stability and creditworthiness. Moody’s highlighted the presence of key institutions like Offutt Air Force Base, the University of Nebraska Medical Center, Creighton University, and Fortune 500 companies as factors contributing to Omaha’s economic resilience. S&P’s credit analyst Malcolm Simmons commended Omaha’s role as a regional economic hub supported by strong employers, a robust housing market, affordability, and population growth as key drivers of revenue streams such as property and sales taxes.
Omaha’s capital improvement and financial planning efforts are crucial for sustaining the city’s growth and addressing future challenges. By effectively utilizing bond proceeds, diversifying revenue sources, and focusing on strategic redevelopment, Omaha can navigate the evolving landscape of urban development and continue to thrive as a dynamic and resilient community.