Expanded affordable housing proposal clears first round
Lawmakers amended and advanced a bill March 6 intended to enhance the efficiency and effectiveness of the state’s efforts to increase affordable housing.
LB768, sponsored by Norfolk Sen. Robert Dover, would make a number of changes to the powers of the Nebraska Investment Finance Authority, the Rural Workforce Housing Investment Act and the Middle Income Workforce Housing Investment Act.
Dover said the proposal would ensure that Nebraska’s housing and investment programs have the right structure and accountability to meet the state’s growing housing demand.
“Housing shortages across the state are affecting workforce growth, community stability and economic opportunity,” Dover said. “It’s imperative that we, as the Legislature, do what we can to responsibly accelerate housing development while remaining fiscally conservative and careful with taxpayer dollars.”
He said the bill would allow the state Department of Economic Development to contract with NIFA, the entity already responsible for administering federal housing tax credits, bond financing and home-buyer programs, to oversee key housing functions — allowing DED to focus on its core function of economic development.
Under the proposal, NIFA would gain additional powers to establish and own nonprofit subsidiaries that further housing goals and would not be held responsible for the debts, liabilities and obligations of any nonprofit subsidiary it creates.
The bill also would dissolve the Housing Authority Committee and grant DED the power to contract with statewide nonprofits to serve as agents for workforce and middle income housing programs. Among other provisions, it also would:
• shorten the NIFA grant and loan application period from 90 to 60 days;
• allow funds held in any escrow account to be recaptured by DED;
• include interest earned on awards recouped by DED to also be recouped;
• provide that any building constructed or repaired using state grant funds that will not, however, be owned or managed by the state, would not be subject to state energy code compliance and mandatory plan reviews.
A Banking, Commerce and Insurance Committee amendment, adopted 36-0, would add provisions of LB1246, also introduced by Dover.
Those provisions would require NIFA to record all instances of revenue, fund balance and expenditure within a formal accounting system and submit, at least 20 days before the start of each legislative session, a report on the condition of all public funds for grants or loan programs involving public funds pursuant to an agreement with a state agency.
NIFA also would be required to provide monthly accountings of all such transactions and detailed annual reports, beginning July 1, 2027.
Dover said the proposal would strengthen oversight and ensure that state housing dollars are subject to clear reporting requirements and monitoring.
Syracuse Sen. Bob Hallstrom offered an amendment to the committee amendment, adopted 35-0, to add provisions of his LB819 to the measure. Currently, the Rural Workforce Housing Investment Act is set to end July 1, 2027, and the Middle Income Workforce Housing Investment Act is set to sunset July 1, 2029.
As introduced, LB819 would have extending both programs through July 1, 2037. Under Hallstrom’s amendment, the programs instead would sunset July 1, 2032. The provisions also would change definitions in the Middle Income Workforce Housing Investment Act to include construction cost in determining a property’s value.
Finally, the amendment would increase the construction cap on owner-occupied housing units under the Rural Workforce Housing Program from no more than $325,000 to $375,000 and on rental units from no more than $250,000 to $300,000.
Hallstrom said both programs have provided an excellent return on investment in the state’s effort to provide more affordable housing options.
Following the 36-0 adoption of a cleanup amendment from Dover, senators advanced LB768 to select file on a 40-0 vote.
