Omaha Held Hostage

...That plan envisioned the reConAgra chose to play hardball, threatening to pull out of Omaha unless it was given exactly what it wanted— permission to build its headquarters on the site of Omaha's architectural showcase...

...The problem, Nebraskans soon learned, is that when enough jobs are at stake and public officials are desperate, bidding wars among municipalities and even states can quickly become extremely costly...

...specifications have changed and the city public-works department has found rubble from old buildings below the surface of the site...

...In a separate suit, the American Indian Center of Omaha challenged an emergency county appropriation for the project...

...The protesters' hostility toward the council grew because they knew the deal was sealed and time was short...

...That means, in effect, that it could happen in virtually any city in the United States...

...Shukert and another planner, Greg Peterson, informed Harper that his demand was "impossible" because of the district's historic significance and the expense of acquiring and demolishing the buildings...

...ConAgra has played the tough guy...

...It would appear to me," he says, "that ConAgra will have outgrown their campus before Jobbers Canyon is renovated...

...ConAgra's design subsidiary, Opus Corporation of Minneapolis, prepared its own designs...

...They told Mayor Simon that neither funding issues nor Jobbers Canyon should deter the city from working with ConAgra on a riverfront site...

...Members of the planning department staff claim that most of the staff opposed the philosophy behind the plan...

...Another asked, "Is there anything ConAgra would have asked that you wouldn't have given them...

...ConAgra said it would leave Nebraska...

...To Harper, though, they were "big, ugly, red brick buildings" and an obstacle to his concept for a new headquarters...

...PROUD has been unable to save other buildings for which it lacked the money to post bond...

...The city would spend $2.5 million for streets and sewers, and the public power district would spend $4 million to relocate power lines...

...An Opus study released in June outlined schemes for both the suburban site and Central Park East...

...PROUD claimed involvement by the National Park Service, the Interstate Commerce Commission and the U.S...

...One woman demanded to know, "Where are the real men in this room...

...Until recently, these suits stopped nothing...

...There would be no direct access from Old Market because that would violate ConAgra's privacy...

...and by pushing it around as well as destroying its past, has stripped the community of its self-confidence...

...On January 5, 1988, Harper held a press conference at the Omaha Chamber of Commerce to announce that ConAgra would stay...

...Understandably, the Jobbers Canyon businesses, some of which had been in their locations for almost a century, demanded enough compensation to replace their facilities and relocate their operations...

...Shukert noted that a World-Herald survey showed overwhelming public support for the project, and told me more recently, "Mike Harper has very good public relations...

...No neighborhood groups reacted at first...

...OMAHA HELD HOSTAGE How a food giant gobbled up a historic district BY JIM SCHWAB A few old buildings still stand in Jobbers Canyon, a warehouse district nestled between Omaha's central business area and the Missouri River...

...When activist Mark Himes and others launched PROUD in February, they had to function without much access to the news media while the Omaha World-Herald denounced them as obstructionists...

...The district contained side-by-side contrasts of beautifully ornate stonework and clean-lined, functionalist buildings...

...You lose that sense of a cycle, that there can be a resurgence," he says...

...Local activists were slow to respond to the threat to Jobbers Canyon—partly because they trusted Shukert...

...Tax-incremental financing to support infrastructure costs would apply to the first two phases of ConAgra's campus...

...The entire warehouse district would have to go, not because ConAgra's buildings would occupy the land, but because the warehouses would create a visual obstruction between the campus and downtown...

...Omaha has been a city in fear of its own economic future ever since Enron, a Texas energy company, purchased the locally based InterNorth in 1986 and moved its 2,000 employees to Houston...

...The city claimed there was none, leaving it free to proceed...

...The redevelopment agreement projected $37.8 million in land-acquisition and site-preparation costs, including grading the land to ConAgra's specifications, acquisition of Jobbers Canyon and the relocation of its businesses, and landscaping...

...Review is required prior to condemnation of National Register properties if there is any Federal involvement in the project...

...It was Omaha's most unusual architectural showcase...

...The park was to let Omaha realize its "dream" of bringing development down to the river's edge, but it would be accessible only from the west, along a narrow corridor below the interstate bridge...

...The nearby Union Pacific Railroad would also spend $55 million to renovate its historic freight house to computerize its dispatching facilities, but that project was planned independently of ConAgra...

...The cost of cleanup, depending on the quality of the job performed, now ranges from $3 million to $7 million...

...The city was again on the verge of losing ConAgra...

...The city agreed to indemnify ConAgra for liability for any hazardous waste that might later be discovered on the site...

...Michael Wiese, ODF executive director, refuses to criticize ConAgra for its determination to obliterate Jobbers Canyon...

...Orr, a Republican and former state treasurer, had won the governor's office the previous fall largely on the basis of her economic expertise...

...Simon agreed, and a joint project team from the city and the Omaha Development Foundation worked to meet ConAgra's conditions, which escalated until ConAgra finally set a January 3 deadline for a decision by the city for producing an agreement...

...The community needed jobs, and the project was in no one's residential back yard...

...The rest of Jobbers Canyon is already dust, the result of the largest demolition ever of a National Register historic district...

...ings, the city agreed to clear the land and relocate the existing businesses in Jobbers Canyon, which themselves employed some 500 people...

...Even the private cost of land acquisition paid for by the Omaha Development Foundation has its public impact, notes Ed Fogarty, PROUD's attorney, who says the foundation is "leaning so hard on big donors in the corporate community that these have become very hard times for the arts in Omaha...

...They're going to fight this.'" The truth gradually sank in, however, that even Shukert's resignation "would have made no difference...

...But last March, the Eighth Circuit Court of Appeals issued a temporary injunction restraining demolition of five buildings until it could rule on the allegation of Federal involvement, and set an April 12 hearing on the case...

...The city council unanimously favored every measure to move the plan forward...

...Downtown Omaha Neighborhood Association member Eileen Radigan complains of poor air quality from the demolition work and park cleanup and has begun to bird-dog what she considers inadequate air-quality monitoring by the county...

...ConAgra's investment in the site would total about $50 million...

...So biased was Nebraska's leading newspaper that three small Nebraska papers attacked the World-Heralds coverage in their own editorials...

...He probably understood that Omaha business leaders would not fight him on that point, since little renovation had, in fact, occurred in Jobbers Canyon since adoption of the riverfront development plan in 1973...

...The county, which will develop the public park, must first clear lead, arsenic, and cadmium wastes left behind by such former industrial users as Gould Battery...

...Reluctant property owners were faced with condemnation...

...In a lawsuit filed with two other plaintiffs, PROUD alleged that the city, ODF, and other defendants were conducting "anticipatory demolition," destroying Jobbers Canyon before a review Is there anything ConAgra could have asked for that you wouldn't have given them?' one woman demanded at a city council meeting...

...It all happened because ConAgra, a giant food-processing corporation, wanted it that way and because the city went along in its eagerness to attract ConAgra to a riverfront site...

...He later promised to use the city's eminent-domain powers, so that the businesses could avoid Federal capital-gains taxes on the sale of their buildings...

...But he probably dared not mention that Harper had virtually a free public-relations machine at his disposal in the World-Herald...

...The tight-knit downtown business community scrambled to find ways to reinvigorate the local economy...

...And, he adds, a plan that ultimately will cost taxpayers upwards of $60 million, though city officials have routinely disputed PROUD's figures—until they turned out to be right...

...ConAgra's January ultimatum pushed the community groups into action...

...Nonetheless, city staff began meeting with ConAgra representatives to promote Central Park East, the riverfront location, the city's preferred site...

...Landmarks, Inc., a group dedicated to redevelopment of historic properties, expressed concern...

...A day later, Harper said ConAgra would locate in Omaha...

...ODF would handle the actual demolition, raising most of the money from the private sector...

...In mid-April, Harper announced that the firm was looking for an Omaha site because it was confident the legislature would enact Orr's proposals...

...If the city, county, and ODF could meet them, fine...

...The state and Federal district courts in Nebraska ruled against PROUD and the National Trust...

...By May, the wrecking ball was already swinging in Jobbers Canyon...

...Shukert says the decision "was never really mine...

...The city's long-standing plan-adopted in 1973—was to link downtown development to the long-neglected riverfront south of the Interstate 480 bridge from Iowa...

...The county would acquire twenty-seven acres for a public park, half of which would be a lake, and would commit $6.3 million toward its construction, with most of the rest coming from the Peter Kiewit Foundation...

...The cost of the first phase has actually risen by $10 million...

...The city would provide $2.6 million in street and sewer construction and $6 million for Jobbers Canyon demolition...

...In May, the board of Landmarks, Inc., reversed a previous decision and voted to join the suit after a presentation by an attorney representing the National Trust for Historic Preservation, which became an intervener...

...Simon at one point even projected the creation of 10,000 jobs, a figure no one else offered to substantiate...

...One typical World-Herald editorial asserted, "No one has stepped forward with the money to buy Jobbers Canyon and preserve it," failing to mention that the area was already an active commercial district...

...Grading costs, originally projected at $1.25 million, now stand at $3.55 million...

...Lincoln business interests offered ConAgra a free 240-acre site...

...But if Shukert agonized over the senseless destruction occasioned by Harper's intransigence—and opponents of the project concede that he did—he was probably the only city leader to do so...

...Jobbers Canyon business owners, like others, were caught off guard by the notion that the city would agree to such enormous subsidies...

...All that will occupy Jobbers Canyon, however, is a magnificent brick-paved diagonal driveway, built at city expense, that leads only to the ConAgra complex...

...That led, says Thomas White, a member of Preservationists for Responsible Omaha Urban Development (PROUD), to a plan "conceived in fear, negotiated in secret, and executed in haste...

...When I first heard this," says Mark Mercer, a preservationist and president of Old Market's Mercer Management Company, "I thought, 'Marty and those guys share most of our general views____They're going to save a lot of it...

...But with ConAgra's suburban property as an option, Harper remained in the driver's seat even after narrowing his options to Omaha...

...Most adopted a completely uncritical stance, touting the plan as Omaha's economic salvation...

...ODF had acquired options on all of Jobbers Canyon...

...Meanwhile, however, the public costs of accommodating ConAgra have mounted...

...the latter would have retained most of Jobbers Canyon...

...ConAgra's intent was to use a series of low-rise buildings for its subsidiaries, with none dominating the others...

...I contemplated the future of downtown without ConAgra, and it was bleak...

...Army Corps of Engineers...

...Between the loss of Enron and a depressed farm economy, Nebraska legislators were prepared to act on Orr's initiatives...

...The plan also promised a future hotel and office development on the site...

...The idea of mustering nearly $40 million in public and private commitments, aside from the cost of developing the park, to attract a $50 million investment from ConAgra, finally jolted opponents into action...

...City council hearings became increasingly testy until an April 1988 hearing on an amendment produced an hour-long parade of hostile witnesses, some vowing to work against incumbents in coming elections...

...But Harper rejected that plan, again insisting that the warehouses were "incompatible" with the proposed ConAgra campus...

...County attorney Henry Wendt is negotiating with Gould for a commitment to help pay for cleanup, but concedes he has no written agreement and could not sue because, with the site's multiple users over time, it would be impossible to pin any specific contamination on one firm...

...Opponents were routinely criticized for their failure to produce an alternative plan...

...under the 1966 Historic Preservation Act could occur...

...It was, of course, the classic pose of the footloose corporation prepared to make the best possible deal on its own terms...

...ConAgra, for its part, committed itself to a $50 million development in two phases, with a projected later expansion worth another $50 million...

...Business leaders—including Omaha World-Herald publisher Harold Anderson—quickly intervened, meeting on June 18 with the mayor, an aide, and Shukert...

...But a hitch developed a month later, when the legislature removed a personal property-tax exemption on purchases of jets and mainframe computers from LB 775...

...Early in 1987, Governor Kay Orr and the Nebraska legislature were debating her four proposed business-incentive bills...

...The pressure ConAgra applied in Omaha— and the city's vulnerability to that pressure—are likely to serve as prototypes for other corporations and for other jittery municipalities...

...The planning department's own advisory body on preservation matters, the Landmarks Heritage Preservation Commission, voted to oppose the plan...

...Charles M. "Mike" Harper, Con-Agra's chairman and chief executive officer, likes to be in the driver's seat...

...Because ConAgra wants a clear view of downtown from a series of low-rise buildJim Schwab is assistant editor of Planning magazine and author of "Raising Less Corn and More Hell," published in 1988 by the University of Illinois Press...

...At least until a Federal appeals court rules, probably in May, on a lawsuit filed by preservation groups, the remaining old structures are protected by a temporary court injunction...

...That calls for more patience than it's reasonable to expect...

...Historic areas show cities that there have been cycles and periods of economic strength in the past...

...The legislature restored the exemption and passed the final version 37-to-11...

...It was a living museum that documented the attitudinal shift that took place in commercial design within a single generation...

...ConAgra had begun to study headquarters sites the year before...

...Once the mayor made the decision, I had to decide whether it was an ethical one...

...When ConAgra began to consider sites for a new headquarters, the Omaha Development Foundation (ODF)— in effect, Omaha's power structure—tried to persuade the company to locate downtown...

...development of some units for downtown housing, restaurants, and small retail shops, along the lines of the highly successful Old Market area immediately to the west...

...Legislative Bill 775, her main proposal, provided such business incentives as a tax credit for 5 per cent of the additional annual payroll a company creates (which one economist estimates will cost the state $20 to $40 million a year for the next fifteen years...

...But ConAgra, which already owned rural land north of the city, chose to play hardball: It openly considered moves to other cities unless it was given exactly what it wanted...

...Jobbers Canyon, built in the 1890s and early 1900s, was widely regarded as the best example of American commercial architecture's transition from classical styles to modernism...

...By August, ODF had determined that land acquisition for the project would cost an estimated $23.7 million...

...But Clark Strickland, regional director for the National Trust for Historic Preservation, in Denver, who has worked with PROUD on the issue, may have identified the most significant price Omaha has paid in its desire to keep ConAgra...

...ConAgra is developing seventy acres for a corporate headquarters campus that initially will bring some 500 jobs to Omaha, though most of the jobholders will come from other ConAgra locations...

...What happened in Omaha could happen to any other city nervous about its economic prospects and insecure about its ability to make the most of its resources...

...He might have swayed one council vote...

...If not, ConAgra could go elsewhere...

...Mayor Simon met with them in November to discuss using tax-incremental financing to assist their relocation—a move that would cost the city future revenue...

...He responded to pleas by the Omaha Development Foundation and the administration of the late Mayor Bernard Simon by spelling out ConAgra's demands...

...The parties met through the summer of 1987, with Omaha planning director Martin Shukert intent on persuading ConAgra to locate downtown under a plan that would preserve Jobbers Canyon...