Omaha City Council unanimously passed an $80 million TIF last Tuesday to help fund the redevelopment of the vacant Crossroads Mall.
Crossroads went into foreclosure in 2010, and there have been multiple attempts to renovate the site. No one has come as close as Lockwood Development, who plan to turn the 40-acre plot into a lifestyle center with restaurants, apartments and office spaces.
Bridget Hadley, economic development manager for the Omaha City Planning Department, said the City of Omaha has made a commitment to redevelop the mall.
“It is an iconic location and a historic landmark, that’s what make it important,” Hadley said about redevelopment. “There is no other area in Omaha that has that same significance.”
TIF stands for Tax Increment Financing. According to the City of Omaha’s website, it is a revitalization tool used to finance redevelopment projects. TIF has been used previously to fund the construction of Midtown Crossing and the HDR Headquarters in Aksarben.
The TIF for Crossroads is the biggest in Omaha history. It is more than double the amount used to build Midtown Crossing.
TIFs are developer financed, meaning the developer must secure a loan from a bank up to the approved amount according to the City of Omaha’s website. Property taxes are paid based on property valuations. Vacant sites have minimal property tax revenues but will grow as redevelopment takes part. This means that the developer is “borrowing against the future.”
“The revenues are only based on that particular project at that redevelopment,” Hadley said. “Nobody else’s property is involved, so no one else is paying taxes.”
Mark Gudgel, English teacher at Omaha North and candidate for mayor, is an opponent of the Crossroads TIF. Gudgel said that the Crossroads developer has donated thousands of dollars to Mayor Stothert and to members of the city council.
“If you can donate $80,000 and get $80 million back, you are a heck of an investor,” Gudgel said. “That is a tremendous return on investment, you’re just relying upon corruption to make it happen.”
The Crossroads redevelopment is helping defund public education and is infuriating to teachers across Omaha, Gudgel said.
“I can think of any number of neighborhoods and any number of projects and places where tax increment financing can go a long way,” Gudgel said. “That is just not one of them.”
Demolition of Crossroads Mall began in December and is expected to be completed in May. The Crossroads website says that the first businesses and tenants could be occupying building by late 2024.
