Reignited process to award $225 million in grants to North, South Omaha has unlikely critics

OMAHA — The main architects of Nebraska’s Economic Recovery Act — an unprecedented, multimillion-dollar effort to lift the state’s poorest areas — are unhappy with how a state agency is carrying out the latest and perhaps most critical phase.

“I think people are more confused now,” said State Sen. Terrell McKinney, who shepherded the overall package, along with fellow lawmaker Justin Wayne, through two years of legislative debate.

“The current process and what’s been going on in the past three months have been opposite the vision of the North and South Omaha recovery program,” McKinney told the Nebraska Examiner.

The North Omaha senators’ frustration comes as the Nebraska Department of Economic Development reignites a selection process intended to award about $225 million to ventures that invigorate North and South Omaha. 

$1.7 million consultant

The process was started last year by the private Olsson consultant team, which was paid $1.7 million by the state to coordinate a distribution plan and work with a special legislative advisory panel. 

Olsson hosted community meetings, explored needs and narrowed some 365 applications to 35 recommended frontrunners. Then controversy arose, and the Legislature this year directed the DED to finish the process.

The DED has since crafted a 23-page guidance manual. It defined new categories under which applicants can seek grants, and this month opened 30-day application periods for three of the eight program areas. 

State officials expect to award the first wave of grants in October.

 “We want the money out there in these communities making a difference,” said K.C. Belitz, DED director.

While McKinney is disappointed with the DED-led rollout — saying that neither constituents nor their state senators have received timely and sufficient information — Belitz commended his team’s efforts and progress. 

Said Wayne: “I’m very concerned this is moving away from the intent of the law, and the actual language of the law.”

Belitz said his staff has met with McKinney and Wayne multiple times and believed them to be “productive” conversations. 

“I’m always interested to hear what our partners think and want to see happen,” Belitz said. But he added, “It is also now our responsibility to carry this out. That’s the job we’ve been given in the statute.”

McKinney and Wayne are featured speakers at a “community summit” Saturday at North High School, organized by the Empowerment Network and Black Men United, to help explain the current grant process and “walk” through the manual made public this month. 

McKinney said he is fears that applicants don’t have adequate time to prepare for the opportunity. Among his other objections is a new mandate that any North-South group seeking funding for a sports facility obtain a letter of support from the mayor of Omaha.

That creates a barrier, McKinney said, adding that the city shouldn’t have such control over a potential competitor. 

Goal is job creation, growth

Trevon Brooks, the DED’s chief strategy officer, said his agency’s overarching goal in awarding the grants is job creation and economic growth.

He said the team has created an informational website, carved out office hours and is available to meet with applicants to answer questions. 

The agency also plans to hire consultants from North and South Omaha to assist.

Asked how Olsson’s work comes into play, Brooks said his team is using it as a “base.”

The Olsson-led meetings, needs assessment and review of thousands of pages of applications culminated in an 80-page main report with recommendations and 500 pages of supporting data, narratives, photos and graphics, much of it translated into Spanish.

“I wouldn’t say we’re starting over,” said Brooks. “I think the Olsson plan gave us a great starting point to look at our strategy.”

Perhaps the most common question has been who now is eligible to compete for a chunk of the $225 million.

Updates made this year to the Economic Recovery Act passed in 2022 limits applicants to the pool of roughly 365 public, private and nonprofit entities that requested funds during the Olsson go-around, Brooks said. Combined, those requests totaled about $3 billion.

He said projects that had been recommended for funding by Olsson are to get bonus points in the DED scoring method.

“It was’t easy…”

McKinney said it appears that one of the most costly projects recommended by Olsson — the proposed Sankofa Innovation District in North Omaha — is not seeking to reapply. That would open up $40 million, if that were the case.

The lead contact for Sankofa did not respond to a reporter’s calls or email.

Another of the high-dollar ventures recommended by Olsson — the Q Street partnership led by Canopy South — will reapply, said spokesman Cesar Garcia. 

The partners are eager to build their various projects along or near the main South Omaha corridor, he said.

“It wasn’t easy getting to this point,” Garcia said, noting community angst and uncertainty over the winding grant process. “But it seems there is a clear path for success. It’s a matter of time now.”

McKinney said he is hopeful communication will improve, and is likely to reconvene the special advisory committee of lawmakers to speak to the DED.

“We’re the ones taking all the bullets for this, they are the ones in charge of administering the process, and they’re not listening to us like they should be.”

Mission deep, personal

For him and Wayne, the Economic Recovery Act was deep and personal. It’s been nearly two years since they began to publicly champion the “once in a lifetime” opportunity to tap into plentiful pandemic-related federal dollars to uplift their community.

They said then it was time for “big ideas” and “assertive leadership” to reverse historic social and economic disparities exacerbated by COVID-19.

South Omaha was added to their proposal, and the Legislature got behind impassioned speeches by the east Omaha contingent, adopting Legislative Bill 1024 in 2022 as the original $335 million Economic Recovery Act. (Some of those funds were appropriated for specific projects, but the bulk was for North-South grants.)

Then-Gov. Pete Ricketts joined a celebratory bill-signing event, calling it landmark legislation that will have “generational impact.”

But later, some critics questioned the Olsson scoring and overall process guided by the special legislative committee. A lawsuit filed by a group of North Omaha merchants is pending.

A Flatwater Free Press report questioned Wayne’s ties to one of the recommended grantees. Wayne said he had no current involvement or financial interest in the company.

This past legislative session, when updating parts of the recovery act via LB 531, the Legislature shifted North-South grant duties to the DED. It also changed pots of money, from federal COVID-related dollars to state  funds, so grantees would have more flexibility and time to finish projects.  

Belitz said the dollars will go to ventures with promise to deliver economic punch and lasting impact.

“So we look back in 10 years or 20 years and say, ‘Yes, those investments made by the State of Nebraska have made a difference in the vitality of these communities.’ ”