Mayor issues sharp criticism after Omaha senator slams streetcar, suggests pausing projects

OMAHA, Neb. (WOWT) - Mayor Jean Stothert fired back Thursday at Omaha Sen. Mike McDonnell’s recent criticism of TIF funding for the streetcar project, saying his “constant false statements and false information about TIF and the streetcar must stop.”

The state senator sent a letter to Stothert and Omaha City Council President Pete Festersen on Tuesday citing his concerns about Nebraska State Auditor Mike Foley’s recent criticism of TIF funding across the state, and the Omaha Streetcar project in particular.

In his letter, sent Tuesday, McDonnell specifically took issue with the city’s streetcar project and called for a pause in any new TIF projects until his outlined concerns were addressed.

But the mayor said in her reply on Thursday that Foley’s assessment of the project was “beyond the scope of his responsibilities,” and that “pausing” new TIF projects would obstruct economic growth in Omaha.

McDonnell said he had three specific issues about the funding: that the nonprofit organization managing the funds; that the project area received an additional five years to collect TIF money upon the passage of a tax law in 2021; and the designation of funded areas as “extremely blighted.”

“I can say, that as a member of the Legislature who voted for LB25, it was not my intention to allow an extension in this manner,” he said in the letter.

While acknowledging the law didn’t seem to prohibit adding on to existing terms, he pointed out that “Section 2 seems to indicate that previous/existing projects ‘remain undisturbed.’"

Stothert said the city conducted an extensive study of the conditions of the areas that would be included in the streetcar project, which came to the conclusion that they did indeed qualify as blighted census tracts.

Addressing McDonnell’s concern about the nonprofit, she said that the city had considered working with that entity but instead created the Omaha Streetcar Authority.

This week’s exchange wasn’t the first mayor had corresponded with McDonnell on the topic. In June, she sent him a letter accusing the lawmaker of perpetuating “the myth that the streetcar will cause financial ruin for the city” and avoiding taking any substantive action to register his opinions on the record.

Read the documents

Sen. McDonnell made the following statement regarding the Mayor’s letter late Thursday:

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