Missing Middle Housing Legislation in Nebraska

Background

Nebraska has a shortage of affordable homes for low-income households, with only 77 units affordable and available for every 100 renters with incomes at 50% of the area median. Two- to 4-unit housing has seen a steady decline in the state: in the 2010s, Nebraska permitted more than 2,000 units in 2- to 4-unit buildings, compared to over 6,000 in the 1970s.

Reforms Implemented

In response to Nebraska’s housing affordability challenges, State Senator Matt Hansen developed statewide legislation to allow more housing to be built, gaining support from local realtors and AARP Nebraska. Sen. Hansen said he did not have “very much negative feedback.”

In 2020, the Nebraska State Legislature passed LB866, which included the Municipal Density and Missing Middle Housing Act, a version of Sen. Hansen’s bill, by a vote of 31-7. LB866 is a less prescriptive policy tool than other reforms in this series of case studies. Rather than setting specific zoning or land use requirements or preempting local laws, the bill requires cities to provide detailed information about their housing needs and existing land use practices. The bill also requires cities to develop their own action plans to increase affordable, denser housing, through zoning reforms and other actions.

While not as prescriptive as statewide zoning reform laws in California and Oregon, Nebraska’s approach through LB866 may build more buy-in from cities by encouraging them to be proactive about developing comprehensive, impactful plans to meet their specific needs. Additionally, the law’s information reporting requirements will help the state understand its needs in extensive detail. Finally, the law pairs its zoning reforms with new grants for middle-income housing development—a strategic approach, as zoning reform alone is not sufficient to meet housing supply gaps.

Early Evidence

The deadline for larger cities to adopt new action plans was in January 2023, and the deadline for smaller cities is January 2024, so it is still far too early to measure the impact of LB866 in terms of the development of new housing. But early city action plans provide an indication of how seriously cities are taking the state’s mandate to carry out zoning reform.

Omaha’s action plan declares the city should revise its Zoning Ordinance to “make it easier to build a variety of building types while still respecting existing neighborhood character.” It proposes—though does not commit to—modifying the Zoning Ordinance to allow for more triplexes, fourplexes, and smaller-scale multifamily housing. It also proposes allowing for more ADUs and modifying minimum parking requirements.

Lincoln’s more detailed action plan proposes reducing or eliminating parking requirements for affordable units within half a mile of bus lines, as well as allowing more residential housing in commercial areas. The plan also proposes allowing a by-right development process for housing types that have been allowed as exceptions to existing ordinances in the past.

These proposals outline modest but meaningful measures to allow for more affordable housing options. The degree to which cities like Omaha and Lincoln take action to implement these measures in the coming years will determine whether Nebraska’s nonprescriptive approach to zoning reform is a success.

Read more zoning and land use case studies here.