Second Amendment to Grant Agreement with Virtual Velocity, LLC for the Rehabilitation of 1199 Central Avenue Copyrighted
October 16, 2023
City of Dubuque Items to be set for Public Hearing #
City Council Meeting 01.
ITEM TITLE: Second Amendmentto GrantAgreementwith Virtual Velocity, LLC for
the Rehabilitation of 1199 Central Avenue
SUM MARY: City Manager recommending City Council adopt a resolution setting a
public hearing for November 6, 2023, on the issuance of 15-years of tax
increment financing for the project included in the attached Second
Amendment to Grant Agreement with Virtual Velocity, LLC.
RESOLUTION Fixing the Date for a Public Hearing of the City Council
of the City of Dubuque, lowa on a Second Amendment to Grant
Agreement by and Between the City of Dubuque, lowa and Virtual
Velocity, LLC, Including the Proposed Issuance of Urban Renewal Tax
Increment Revenue Obligations Relating Thereto, and Providing forthe
Publication of Notice Thereof
SUGGESTED Receive and File;Adopt Resolution(s), Set Public Hearing for November
DISPOSITION: 6, 2023Suggested Disposition:
ATTACHMENTS:
Description Type
MVM Memo City Manager Memo
Staff Memo Staff Memo
Resolution Resolutions
Second Amendment Supporting Documentation
Notice of Public Hearing Supporting Documentation
Dubuque
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Second Amendment to Grant Agreement with Virtual Velocity, LLC for the
Rehabilitation of 1199 Central Avenue
DATE: October 11, 2023
Economic Development Director Jill Connors is recommending City Council adopt a
resolution setting a public hearing for November 6, 2023, on the issuance of 15-years of
tax increment financing for the project included in the attached Second Amendment to
Grant Agreement with Virtual Velocity, LLC.
The City of Dubuque previously entered into a Grant Agreement, dated October 3, 2022,
by Resolution No. 325-22. This property is the former Prescott elementary school. Virtual
Velocity, LLC is a local organization entering into building preservation and rehabilitation.
Lloyd Singletary, organizer, is restoring the building's fa�ade while creating 14 new
market-rate rental units.
On October 2, 2023, the City of Dubuque amended the Agreement by Resolution No.
331-23 to include a Downtown Rehabilitation Loan in the amount of$300,000.
In August 2022 and again in August 2023 at the City Council Annual Goal Setting
sessions the City Council identified the Central Avenue Corridor revitalization as a
priority.
In August 2022 the City Council established Housing Incentives as a priority.
Previously the City Council has directed that the City should work on not having former
school sites stay vacant and become blighting influences on neighborhoods.
A Brief History of the Third Ward Schoolhouse
In 1856, a new building was constructed at 12t" and Clay Streets (now Central Avenue)
to house the Third Ward School. The structure had a cross plan and was of the
Italianate style, popular at the time. It had load bearing masonry brick walls with a
strong Dubuque limestone foundation and watertable. The building had large windows
affording light and ventilation for a healthy learning environment. The structure is a rare
pre-Civil War public structure and eligible for the National Register of Historic Places
based on Criterion C, due to its being a rare surviving early architectural type, and its
association with Dubuque architect John Francis Rague (1799-1877). The cost for the
structure was $25,000, constructed by builders Berry, Platert & Longhurst. It opened in
January 1857, one month before construction began on nearby City Hall, which was
also designed by Rague.
By 1858 it also housed our first Dubuque Senior High School on the 3rd floor, with
elementary grades below. The high school enrolled one hundred ten students and had a
staff of two teachers and one principal. Students wishing to be admitted to the high
school had to pass a test in arithmetic, geography, grammar and history. The first two
floors were divided into four rooms each, with children separated by gender and the
level of achievement. building was renamed to Prescott School after the American
scientific historian William Hickling Prescott in 1889.
In 1911, the old school housed 603 students from a 170 square block area in 19 rooms
with 21 teachers. The high school had since moved to a new building kitty-corner to the
northeast of the old school. In April 1912, merchants on Clay Street petitioned the board
of education to close the school because it was unsafe. The noise distracted the pupils
and the traffic was a hazard. A formal petition to build a new school was filed on August
8, 1912. In 1913 the "new" Prescott School made the first Prescott School obsolete. The
listing in the city directories changes from "Prescott School" to "Prescott Apartments"
between 1913 and 1915. In 2006, the current Prescott School was opened and
demolition of the 1912 school ensued. Apartment rentals of 1199 Central tapered off in
the early 21St Century and ended by 2015 according to our city directories. It has been
licensed as a vacant and abandoned building since 2019.
The other ward school buildings that resembled this structure are all gone, including the
school that predated the former Franklin School at 39 Bluff, and the schools that
predated the existing Lincoln and Audubon Schools. 1199 Central bears many
resemblances to the old St. Mary's Jackson Street School, now Francis Apartments,
which was successfully restored and converted to twelve apartments in 2017, serving
as a model for the work being done at the old Third Ward School.
This building has been vacant for many years and was a blighting influence on the
neighborhood. Lloyd Singletary took it upon himself to acquire the building and begin a
redevelopment project to create the market rate apartments.
Not only does this project hit several City Council priorities, but this rehabilitation project
is very important to the city because it is in a strategic location for the city in that it is
directly across the street from the existing Prescott Elementary School and it directly
adjoins the Multicultural Family Center.
2
Since the initial Grant Agreement was executed, the City Council has given additional
support to the creation of housing in the Greater powntown Urban Renewal Area.
Multifamily housing creation projects are now eligible for either 10-years of tax abatement
followed by 5-years of tax increment financing or 15-years of tax increment financing.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
v
Mic ael C. Van Milligen
MCVM:sv
Attachment
cc: Crenna Brumwell, City Attorney
Cori Burbach, Assistant City Manager
Jill Connors, Economic Development Director
3
Dubuque Economic Development
Department
THE CITY OF ' ' 1300 Main Street
All-America City Dubuque,lowa 52001-4763
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TO: Michael C. Van Milligen, City Manager
FROM: Jill M. Connors, Economic Development Director
SUBJECT: Second Amendment to Grant Agreement with Virtual Velocity, LLC
for the Rehabilitation of 1199 Central Avenue
DATE: October 9, 2023
INTRODUCTION
This memorandum requests City Council set a public hearing for a Second Amendment
to Grant Agreement with Virtual Velocity, LLC.
BACKGROUND
The City of Dubuque previously entered into a Grant Agreement, dated October 3, 2022
by Resolution No. 325-22. This property is the former Prescott elementary school. Virtual
Velocity, LLC is a local organization entering into building preservation and rehabilitation.
Lloyd Singletary, organizer, is restoring the building's fa�ade while creating 14 new
market-rate rental units.
On October 2, 2023, the City of Dubuque amended the Agreement by Resolution No.
331-23 to include a Downtown Rehabilitation Loan in the amount of$300,000.
DISCUSSION
The dilapidated building is in a highly visible portion of the downtown area. As the building
is located across the street from the current Prescott Elementary School, and adjacent to
the Multicultural Family Center, it is critical to have this blight remedied.
Substantial rehabilitation and adaptive reuse projects often operate under the constraints
of large financing needs and material and labor shortages. Due to the critical need for
housing throughout our community, as identified by City Council, a Second Amendment
has been drafted to further support the project.
Since the initial Grant Agreement was executed, the City Council has given additional
support to the creation of housing in the Greater powntown Urban Renewal Area.
Multifamily housing creation projects are now eligible for either 10-years of tax abatement
followed by 5-years of tax increment financing or 15-years of tax increment financing. The
proposed Second Amendment to Grant Agreement includes 15-years of tax increment
financing for the project.
In August 2022 and again in August 2023 at the City Council Annual Goal Setting sessions
the City Council identified the Central Avenue Corridor revitalization as a priority.
In August 2022 the City Council established Housing Incentives as a priority.
Previously the City Council has directed that the City should work on not having former
school sites stay vacant and become blighting influences on neighborhoods.
A Brief History of the Third Ward Schoolhouse
In 1856, a new building was constructed at 12t" and Clay Streets (now Central Avenue)
to house the Third Ward School. The structure had a cross plan and was of the Italianate
style, popular at the time. It had load bearing masonry brick walls with a strong Dubuque
limestone foundation and water table. The building had large windows affording light and
ventilation for a healthy learning environment. The structure is a rare pre-Civil War public
structure and eligible for the National Register of Historic Places based on Criterion C,
due to its being a rare surviving early architectural type, and its association with Dubuque
architect John Francis Rague (1799-1877). The cost for the structure was $25,000,
constructed by builders Berry, Platert & Longhurst. It opened in January 1857, one month
before construction began on nearby City Hall, which was also designed by Rague.
By 1858 it also housed our first Dubuque Senior High School on the 3rd floor, with
elementary grades below. The high school enrolled one hundred ten students and had a
staff of two teachers and one principal. Students wishing to be admitted to the high school
had to pass a test in arithmetic, geography, grammar and history. The first two floors were
divided into four rooms each, with children separated by gender and the level of
achievement. building was renamed to Prescott School after the American scientific
historian William Hickling Prescott in 1889.
In 1911, the old school housed 603 students from a 170 square block area in 19 rooms
with 21 teachers. The high school had since moved to a new building kitty-corner to the
northeast of the old school. In April 1912, merchants on Clay Street petitioned the board
2
of education to close the school because it was unsafe. The noise distracted the pupils,
and the traffic was a hazard. A formal petition to build a new school was filed on August
8, 1912. In 1913 the "new" Prescott School made the first Prescott School obsolete. The
listing in the city directories changes from "Prescott School" to "Prescott Apartments"
between 1913 and 1915. In 2006, the current Prescott School was opened and demolition
of the 1912 school ensued. Apartment rentals of 1199 Central tapered off in the early
21 St Century and ended by 2015 according to our city directories. It has been licensed as
a vacant and abandoned building since 2019.
The other ward school buildings that resembled this structure are all gone, including the
school that predated the former Franklin School at 39 Bluff, and the schools that predated
the existing Lincoln and Audubon Schools. 1199 Central bears many resemblances to the
old St. Mary's Jackson Street School, now Francis Apartments, which was successfully
restored and converted to twelve apartments in 2017, serving as a model for the work
being done at the old Third Ward School.
This building has been vacant for many years and was a blighting influence on the
neighborhood. Lloyd Singletary took it upon himself to acquire the building and begin a
redevelopment project to create the market rate apartments.
Not only does this project hit several City Council priorities, but this rehabilitation project
is very important to the city because it is in a strategic location for the city in that it is
directly across the street from the existing Prescott Elementary School, and it directly
adjoins the Multicultural Family Center.
RECOMMENDATION/ ACTION STEP
Based on this project's alignment with the City Council's goal of having a Robust Local
Economy and Livable Neighborhoods and Housing, I recommend the City Council adopt
the attached resolution setting a public hearing on November 6, 2023 on the issuance of
15-years of tax increment financing for the project included in the attached Second
Amendment to Grant Agreement.
3
Prepared by/Return to: Jill Connors, Economic Development, 50 W. 13th Street, Dubuque IA 52001, 563 589-4393
Return to Adrienne N. Breitfelder City Clerk City of Dubuque, 50 W. 13th St, Dubuque, IA 52001 (563)589-4100
RESOLUTION NO. 342-23
FIXING THE DATE FOR A PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA ON A SECOND AMENDMENT TO GRANT AGREEMENT BY
AND BETWEEN THE CITY OF DUBUQUE, IOWA AND VIRTUAL VELOCITY, LLC,
INCLUDING THE PROPOSED ISSUANCE OF URBAN RENEWAL TAX INCREMENT
REVENUE OBLIGATIONS RELATING THERETO, AND PROVIDING FOR THE
PUBLICATION OF NOTICE THEREOF
WHEREAS, City and Virtual Velocity, LLC entered into a Grant Agreement, dated
the 3rd day of October 2022, providing for a Façade Grant, a Planning & Design Grant, a
Financial Consultant Grant, and a Housing Creation Grant; and
WHEREAS, the City Council has tentatively determined that it would be in the best
interests of the City to approve the Second Amendment to Grant Agreement with Virtual
Velocity, LLC; and
WHEREAS, it is deemed necessary and advisable that City should authorize
Urban Renewal Tax Increment Revenue obligations, as provided by Iowa Code Chapter
403, pursuant to the Second Amendment to Grant Agreement; and
WHEREAS, before said obligations may be approved, Iowa Code Chapter 403
requires that the City Clerk publish a notice of the proposal and of the time and place of
the meeting at which the City Council proposes to take action thereon and at which
meeting the City Council shall receive oral and/or written objections from any resident or
property owner of said City to such proposed action.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The City Clerk is hereby authorized and directed to cause a notice to
be published as prescribed by Iowa Code Section 403.9 of a public hearing on the City's
intent to authorize Urban Renewal Tax Increment Revenue obligations, to be held on the
61h day of November, 2023, at 6:30 o'clock p.m. The official agenda will be posted on
Friday, November 3, 2023 and will contain listening, viewing, and public input options. The
City Council agenda may be accessed at
https://cityofdubuque.novusagenda.comfAgendaPublicl or by contacting the City Clerk's
Office at 563-589-4100, ctyclerk@cityofdubuque.org.
Section 2. The City Council will meet at said time and place for the purpose of
taking action on the matter of authorizing Urban Renewal Tax Increment Revenue
obligations and the execution of the Second Amendment to Grant Agreement relating
thereto with Virtual Velocity, LLC , the proceeds of which obligations will be used to carry
out certain of the special financing activities described in the Urban Renewal Plan for
the Greater Downtown Urban Renewal District, consisting of the funding of economic
developments grants to Virtual Velocity, LLC pursuant to the Grant Agreement. It is
expected that the aggregate amount of the Tax Increment Revenue obligations to be
issued will be approximately $251,082.
Section 3. The Clerk is hereby directed to cause at least one publication to be
made of a notice of said meeting, in a newspaper, printed wholly in the English
language, published at least once weekly, and having general circulation in said City,
said publication to be not less than four days nor more than twenty days before the date
of said meeting on the issuance of said obligations.
Section 4. That the notice of the proposed action to issue said obligations
shall be in substantially the form attached hereto.
Passed, approved, and adopted this 16th day of October, 2023.
Brad M. Cavanach-�l r
�/l .y
Attest:
Trish L. Gleason, Assistant City Clerk
2
SECOND AMENDMENT
TO
GRANT AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
VIRTUAL VELOCITY, LLC
This Second Amendment to Grant Agreement, dated for reference purposes the
6th day of October , 2023, is made and entered into by the City of Dubuque,
Iowa, a municipality (City), established pursuant to the Iowa Code and acting under
authorization of Iowa Code Chapter 403, as amended (the Urban Renewal Act), and
Virtual Velocity, LLC (Grant Recipient).
WHEREAS, City and Grant Recipient entered into a Grant Agreement dated
October 3, 2022 (the Grant Agreement); and
WHEREAS, City and Grant Recipient previously amended the Grant Agreement
to include a Downtown Rehabilitation Loan; and
WHEREAS, City and Grant Recipient desire to further amend the Grant Agreement
as set forth herein.
NOW THEREFORE, IN CONSIDERATION OF THE MUTUAL TERMS AND
COVENANTS CONTAINED HEREIN, CITY AND GRANT RECIPIENT AGREE AS
FOLLOWS:
Section 1. Section 1.2 of the Grant Agreement is hereby amended to read as
follows:
1 .2 Completion of Minimum Improvements. Grant Recipient shall
complete construction of the Minimum Improvements by June 1, 2024. City
shall determine in its sole discretion (following an inspection by City's
Inspection and Construction Services Department and/or Housing &
Community Development Department, and/or Planning Department) when
the Minimum Improvements have been completed. In order to be considered
completed, the Minimum Improvements must be constructed in accordance
with the terms of this Agreement, in compliance with the regulations of the
Downtown Rehabilitation Grant Program, and in substantial conformity with
Grant Recipient's application to that Program and the Design Letter attached
hereto.
Section 2. Section 3 of the Grant Agreement is hereby amended by adding the
following:
3.7. Economic Development Grants to Developer. For and in consideration of
Grant Recipient's obligations hereunder, and in furtherance of the goals and
objectives of the urban renewal plan for the Project Area and the Urban Renewal
Law, City agrees, subject to Grant Recipient being and remaining in compliance
with the terms of this Agreement, to make thirty (30) consecutive semi-annual
payments (such payments being referred to collectively as the Economic
Development Grants) to Developer:
November 1, 2026 May 1, 2027
November 1, 2027 May 1, 2028
November 1, 2028 May 1, 2029
November 1, 2029 May 1, 2030
November 1, 2030 May 1, 2031
November 1, 2031 May 1, 2032
November 1, 2032 May 1, 2033
November 1, 2033 May 1, 2034
November 1, 2034 May 1, 2035
November 1, 2035 May 1, 2036
November 1, 2036 May 1, 2037
November 1, 2037 May 1, 2038
November 1, 2038 May 1, 2039
November 1, 2049 May 1, 2040
November 1, 2040 May 1, 2041
pursuant to Iowa Code Section 403.9 of the Urban Renewal Law, in amounts equal to a
portion of the tax increment revenues collected by City under Iowa Code Section 403.19
(without regard to any averaging that may otherwise be utilized under Iowa Code Section
403.19 and excluding any interest that may accrue thereon prior to payment to Developer)
during the preceding six-month period in respect of the Minimum Improvements
constructed by Grant Recipient (the Grant recipient Tax Increments). For purposes of
calculating the amount of the Economic Development Grants provided in this Section, the
Grant Recipient Tax Increments shall be only those tax increment revenues collected by
City in respect of the increase in the assessed value of the Property above the assessed
value on January 1, 2022 ($44,750). The Grant Recipient Tax Increments shall not
include (i) any property taxes collected for the payment of bonds and interest of each
taxing district, (ii) any taxes for the regular and voter-approved physical plant and
equipment levy, (iii) the remaining actual amount of tax increment revenues collected by
City in respect of the valuations of the Property prior to January 1, 2022 and (iv) any
other portion required to be excluded by Iowa law, and thus such incremental taxes will
not include all amounts paid by Developer as regular property taxes.
3.8. Non-appropriation/Limited Source of Funding. Notwithstanding anything in this
Agreement to the contrary, the obligation of City to pay any installment of the Economic
Development Grant shall be an obligation limited to currently budgeted funds, and not a
general obligation or other indebtedness of City or a pledge of its full faith and credit under
the meaning of any constitutional or statutory debt limitation, and shall be subject in all
respects to the right of non-appropriation by the City Council as provided in this Section
2
3.7. City may exercise its right of non-appropriation as to the amount of the installments
to be paid during any fiscal year during the term of this Agreement without causing a
termination of this Agreement. The right of non-appropriation shall be exercised only by
resolution affirmatively declaring City's election to non-appropriate funds otherwise
required to be paid to Developer in the next fiscal year under this Agreement.
(1) In the event the City Council elects to not appropriate sufficient funds in the
budget for any future fiscal year for the payment in full of the installments on the
Economic Development Grant due and payable in that fiscal year, then: (i) City
shall have no further obligation to Developer for the payment of all installments
due in the next fiscal year which cannot be paid with the funds then appropriated
for that purpose; and, (ii) Developer shall be released from all further obligations
under this Agreement during that same fiscal year.
(2) Each installment of the Economic Development Grant shall be paid by City
solely from funds appropriated for that purpose by the City Council from taxes
levied on the Property that are allocated to the special fund pursuant to Iowa Code
(2013) § 403.19(2).
(3) The right of non-appropriation reserved to City in this Section 3.7 is intended
by the parties, and shall be construed at all times, so as to ensure that City's
obligation to pay future installments on the Economic Development Grants shall
not constitute a legal indebtedness of City within the meaning of any applicable
constitutional or statutory debt limitation prior to the adoption of a budget which
appropriates funds for the payment of that installment or amount. In the event that
any of the provisions of this Agreement are determined by a court of competent
jurisdiction to create, or result in the creation of, such a legal indebtedness of City,
the enforcement of the said provision shall be suspended, and the Agreement shall
at all times be construed and applied in such a manner as will preserve the
foregoing intent of the parties, and no event of default shall be deemed to have
occurred as a result thereof. If any provision of this Agreement or the application
thereof to any circumstance is so suspended, the suspension shall not affect other
provisions of this Agreement which can be given effect without the suspended
provision. To this end the provisions of this Agreement are severable.
Section 3. Except as modified herein, the Grant Agreement shall remain in full
force and effect.
CITY OF DUBUQUE, IOWA VIRTUAL VELOCITY, LLC
By: By:
Brad M. Cavriagh, Mayor Lloyd in let; ry, her
3
Attest:
Trish L. Gleason, Assistant City Clerk
4
CITY OF DUBUQUE, IOWA
OFFICIAL NOTICE
PUBLIC NOTICE is hereby given that the Dubuque City Council will conduct a public
hearing on the 6th day of November, 2023, at 6:30 p.m., in the Historic Federal Building,
350 W. 6th Street, 2�d floor, Dubuque, lowa, at which meeting the City Council proposes
to take action to approve a Second Amendment to Grant Agreement between the City of
Dubuque, lowa and Virtual Velocity, LLC, a copy of which is now on file at the Office of
the City Clerk, City Hall, 50 W 13th Street, Dubuque, lowa, providing for the issuance of
economic development grants (Urban Renewal Tax Increment Revenue Grant
Obligations) described therein in order to carry out the purposes and objectives of the
Urban Renewal Plan for the Greater powntown Urban Renewal Area Economic
Development District, consisting of the funding of economic development grants for
Virtual Velocity, under the terms and conditions of the Urban Renewal Plan for the Greater
Downtown Urban Renewal Area Economic Development District. The aggregate amount
of the Urban Renewal Tax Increment Revenue Grant Obligations cannot be determined
at the present time but is not expected to exceed $251,082.
At the meeting, the City Council will receive oral and written comments from any resident
or property owner of said City to the above action. The official agenda will be posted the
Friday before the meeting and will contain public input options. The City Council agenda
can be accessed at https://cityofdubuque.novusagenda.com/AgendaPublic/ or by
contacting the City Clerk's Office at 563-589-4100, ctyclerk@cityofdubuque.org.
Written comments regarding the above public hearings may be submitted to the City
Clerk's Office via email at ctyclerk@cityofdubuque.org or by mail to City Clerk's Office,
City Hall, 50 W. 13t" St., Dubuque, IA 52001, before said time of public hearing. At said
time and place of public hearings the City Council will receive any written comments.
Copies of supporting documents for the public hearings are on file in the City Clerk's
Office and may be viewed Monday through Friday between 8:00 a.m. and 5:00 p.m.
Individuals with limited English proficiency, vision, hearing, or speech impairments
requiring special assistance should contact the City Clerk's Office at (563)589-4100, TDD
(563)690-6678, ctyclerk@cityofdubuque.org as soon as feasible. Deaf or hard-of-hearing
individuals can use Relay lowa by dialing 711 or (800) 735-2942.
Published by order of the City Council given on the 16th day of October 2023.
Trish L. Gleason, Assistant City Clerk