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Notice of Application for Iowa Thriving Communities Designation Copyrighted August 7, 2023 City of Dubuque Consent Items # 08. City Council Meeting ITEM TITLE: Notice ofApplication for lowa Thriving Communities Designation SUM MARY: City Manager recommending City Council approval to submit the lowa Thriving Communities Designation application and further approval to continue through the competition process if selected for each qualifying round. RESOLUTION Authorizing the Housing and Community Development Director to Execute an Application for the lowa Finance Authority lowa Thriving Communities' Designation and Authorizing the Housing and Community Development Director and the City Manager to Approve the Application SUGGESTED Suggested Disposition: Receive and File;Adopt Resolution(s) DISPOSITION: ATTACHMENTS: Description Type MVM Memo City Manager Memo Staff Memo Staff Memo Resolution Approving Application Submission Resolutions Dubuque THE CITY QF � All-Meriea Ciry DLT B E ; . � . � �� � � MaSt� Z�C� aYd t�Q Mt55ZSSZ Z zoa�•zoiz•�ai3 YP pp za��*zai� TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Notice of Application for lowa Thriving Communities Designation DATE: July 25, 2023 Housing & Community Development Director Alexis Steger is recommending City Council approval to submit the lowa Thriving Communities Designation application and further approval to continue through the competition process if selected for each qualifying round. The lowa Finance Authority released a new designation for communities that are taking intentional, and unique action to encourage housing development for all income levels. lowa Thriving Communities Designation application focuses on six different areas that show a community is a thriving community, and Dubuque has taken actions in all six categories. The lowa Thriving Communities Designation is intended to encourage housing development for all income levels. In the State of lowa housing demand is expected to grow by 42,000 households by 2030. The studies completed for the City of Dubuque show that approximately 1,100 of that demand will be in Dubuque, indicating a need for additional housing development. The City of Dubuque recognized this need and has been taking steps to encourage housing development through review of accessory dwelling units, building code review, and by passing housing incentives in September of 2022 that has spurred over 700 units proposed to be developed, and more inquiries are still being received today for further development. The lowa Thriving Communities designation will provide developers bonus points in the Low-Income Housing Tax Credit (LIHTC), highly competitive, application process. This designation will also provide additional points for the Workforce Housing Tax Credit program. Both of these programs are offered to developers through the lowa Finance Authority. Developers proposing projects in Dubuque would receive the bonus points. Often there is 1 or 2 points between those awarded tax credits and those that are not, so this is an extremely important designation for the City of Dubuque to continue to attract housing development. In 2023, eleven projects statewide were approved by IFA for Low-Income Housing Tax Credits and two projects proposed in Dubuque were selected to receive LIHTC. Horizon Development Group, Inc was awarded tax credits for a permanent supportive housing project for families. JB Lofts will be located at 1350 lowa Street and will be an adaptive reuse of the building that Heartland Financial occupied previously. This development will create 30 low-income units for just over $7,500,000, and they will receive approximately $500,000 in Tax Credits and $500,000 in HOME funds awarded by IFA. The second development approved in 2023 was the Emri Apartments being developed by St. Michael Development Group, LLC. This development will be new construction located out on Radford Road next to the Pizza Ranch. This will create an additional 48 low-income family apartments for a cost of just over $14,000,000 and will receive tax credits of approximately $1,100,000 and HOME funds of$500,000 awarded by IFA. These two projects highlight the importance of funding from the lowa Finance Authority to make developments come to fruition. Without these awards, these projects would not move forward. Dubuque needs to add 1,100 units in the next 7 years to keep up with demand and can ill afford to ignore important financing options for developers to meet the housing needs of its residents. I concur with the recommendation and respectfully request Mayor and City Council approval. � Mic ael C. Van Milligen MCVM:sv Attachment cc: Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Alexis Steger, Housing & Community Development Director 2 Dubuque THE CITY OF � All•Ameriea Cily Du 8 E �,��r��:,�w�� , � ����, I I Maste iece on the Mississi i Z°°''Z°iZxz°13 � pp zai�*zoi9 TO: Michael C. Van Milligen, City Manager FROM: Alexis Steger, Housing and Community Development Director DATE: July 25, 2023 RE: Notice of Application for lowa Thriving Communities Designation INTRODUCTION The lowa Finance Authority released a new designation for communities that are taking intentional, and unique action to encourage housing development for all income levels. lowa Thriving Communities Designation application focuses on six different areas that show a community is a thriving community, and Dubuque has taken actions in all six categories. BACKGROUND The lowa Thriving Communities Designation is intended to encourage housing development for all income levels. In the State of lowa housing demand is expected to grow by 42,000 households by 2030. The studies completed for the City of Dubuque show that approximately 1,100 of that demand will be in Dubuque, indicating a need for additional housing development. The City of Dubuque recognized this need and has been taking steps to encourage housing development through review of accessory dwelling units, building code review, and by passing housing incentives in September of 2022 that has spurred over 700 units proposed to be developed, and more inquiries are still being received today for further development. The lowa Thriving Communities designation will provide developers bonus points in the Low- Income Housing Tax Credit (LIHTC), highly competitive, application process. This designation will also provide additional points for the Workforce Housing Tax Credit program. Both programs are offered to developers through the lowa Finance Authority. Developers proposing projects in Dubuque would receive the bonus points. Often there is 1 or 2 points between those awarded tax credits and those that are not, so this is an extremely important designation for the City of Dubuque to continue to attract housing development. In 2023, eleven projects statewide were approved by IFA for Low-Income Housing Tax Credits and two projects proposed in Dubuque were selected to receive LIHTC. Horizon Development Group, Inc was awarded tax credits for a permanent supportive housing project for families. JB Lofts will be located at 1350 lowa Street and will be an adaptive reuse of the building that Heartland Financial occupied previously. This development will create 30 low-income units for just over $7,500,000, and they will receive approximately $500,000 in Tax Credits and $500,000 in HOME funds awarded by IFA. Service People Integrity Responsibility Innovation Teamwork The second development approved in 2023 was the Emri Apartments being developed by St. Michael Development Group, LLC. This development will be new construction located out on Radford Road next to the Pizza Ranch. This will create an additional 48 low-income family apartments for a cost of just over $14,000,000 and will receive tax credits of approximately $1,100,000 and HOME funds of$500,000 awarded by IFA. These two projects highlight the importance of funding from the lowa Finance Authority to make developments come to fruition. Without these awards, these projects would not move forward. Dubuque needs to add 1,100 units in the next 7 years to keep up with demand and can ill afford to ignore important financing options for developers to meet the housing needs of its residents. lowa Thriving Communities Designation will be imperative for Dubuque to have successful low-income and workforce housing projects move forward in 2024. RECOMMENDATION I respectfully request approval to submit the lowa Thriving Communities Designation application and further approval to continue through the competition process if selected for each qualifying round. Service People Integrity Responsibility Innovation Teamwork RESOLUTION NO. 241-23 RESOLUTION AUTHORIZING THE HOUSING AND COMMUNITY DEVELOPMENT DIRECTOR TO EXECUTE AN APPLICATION FOR THE IOWA FINANCE AUTHORITY IOWA THRIVING COMMUNITIES' DESIGNATION AND AUTHORIZING THE HOUSING AND COMMUNITY DEVELOPMENT DIRECTOR AND THE CITY MANAGER TO APPROVE THE APPLICATION Whereas, the Iowa Finance Authority announced a new Iowa Thriving Communities Designation for communities finding creative ways to encourage housing development for residents of all income-levels; and Whereas, the City of Dubuque has taken many steps to make the city a welcoming place for developers through the review of zoning and building codes; and Whereas, the City of Dubuque also approved a new incentive package in September 2022 that included the use of tax abatement and housing TIF to help encourage housing development; and Whereas, the City of Dubuque would benefit from an Iowa Thriving Communities Designation as it provides bonus points for developers competing for low-income housing tax credits (LIHTC) and other funding provided through the Iowa Finance Authority and Iowa Economic Development Authority. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE IOWA: Section 1: That the Housing and Community Development Director is hereby authorized and directed to apply for the Iowa Thriving Communities designation; and Section 2: That the City Manager and the Housing and Community Development Director are hereby authorized to approve the application that is submitted to the Iowa Finance Authority; and Section 3: That the City Manager and the Housing & Community Development Director are hereby authorized and directed to take all actions necessary to complete the competition process that follows the application. Passed, approved, and adopted this 7th day of August 2023. is 2rdavanagh, Mayor Attest: Trish L. Gleason, Assistant City Clerk