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First Amendment to Grant Agreement with Forward Investments Group LLC for the Rehabilitation of 1047 Bluff Street Copyrighted May 20, 2024 City of Dubuque Items to be set for Public Hearing # City Council Meeting 01. ITEM TITLE: FirstAmendmentto GrantAgreementwith Forward Investments Group LLC forthe Rehabilitation of 1047 Bluff Street SUM MARY: City Manager recommending City Council adopt the attached resolution to set a public hearing on June 3, 2024, on the First Amendment to Grant Agreementwith Forward Investments Group LLC forthe rehabilitation of 1047 Bluff Street which will create three new residential rental units, two of which are eligible for the housing creation incentive. RESOLUTION Fixing the date for a public hearing of the City Council of the City of Dubuque, lowa on a First Amendment to Grant Agreement by and between the City of Dubuque, lowa and Forward I nvestments Group LLC, including the proposed issuance of urban renewal tax increment revenue obligations relating thereto, and providing for the publication of notice thereof SUGGESTED Receive and File;Adopt Resolution(s), Set Public Hearing for June 3, DISPOSITION: 2024Suggested Disposition: ATTACHMENTS: Description Type MVM Memo City Manager Memo Staff Memo Staff Memo First Amendment Supporting Documentation Notice of Public Hearing Supporting Documentation Resolution 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: First Amendment to Grant Agreement with Forward Investments Group LLC DATE: May 14, 2024 Economic Development Director Jill Connors is recommending City Council adopt the attached resolution to set a public hearing on June 3, 2024, on the First Amendment to Grant Agreement with Forward Investments Group LLC for the rehabilitation of 1047 Bluff Street which will create three new residential rental units, two of which are eligible for the housing creation incentive. 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 Dubuque Economic Development Department THE CITY OF ' ' 1300 Main Street All-America City Dubuque,lowa 52001-4763 U� � n'�N",`�""""�� Office(563)589-4393 � � TTY(563)690-6678 � http://www.cityofdubuque.org 2007*2012�2013 Masterpiece on the Mississippi zoi�*zoi9 TO: Michael C. Van Milligen, City Manager FROM: Jill M. Connors, Economic Development Director SUBJECT: First Amendment to Grant Agreement with Forward Investments Group LLC DATE: September 26, 2023 INTRODUCTION This memorandum requests City Council set a public hearing for a First Amendment to Grant Agreement with Forward Investments Group LLC. BACKGROUND The City of Dubuque previously entered into a Grant Agreement, dated August 21, 2023 by Resolution No. 263-23 for the rehabilitation of 1047 Bluff Street (the Project). The Project will create three new residential rental units, two of which are eligible for the housing creation incentive. Additionally, the Project received a fa�ade grant, planning & design grant, and financial consultant grant to restore the structure's facade. The project is also utilizing historic tax credits with design plans previously approved by the State Historic Preservation Office. DISCUSSION The Project continues to advance as planned. Since this Grant Agreement was executed, the City Council has given additional support to the creation of housing in the Greater Downtown 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 First Amendment to Grant Agreement includes 15-years of tax increment financing for the project. 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 to set a public hearing on June 3, 2024 on the attached First Amendment to Grant Agreement. 2 FIRST AMENDMENT TO GRANT AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA AND FORWARD INVESTMENTS GROUP LLC This First Amendment to Grant Agreement, dated for reference purposes the day of March, 2024, is made and entered into by the City of Dubuque, lowa, a municipality (City), established pursuant to the lowa Code and acting under authorization of lowa Code Chapter 403, as amended (the Urban Renewal Act), and Forward Investments Group LLC (Grant Recipient). WHEREAS, City and Grant Recipient entered into a Grant Agreement dated August 21, 2023 (the Grant Agreement); and WHEREAS, City and Grant Recipient desire to 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 3 of the Grant Agreement is hereby amended by adding the following: 3.6. 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, 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, 2039 May 1, 2040 November 1, 2040 May 1, 2041 November 1, 2041 May 1, 2042 pursuant to lowa Code Section 403.9 of the Urban Renewal Law, in amounts equal to a portion of the tax increment revenues collected by City under lowa Code Section 403.19 (without regard to any averaging that may otherwise be utilized under lowa 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, 2023 ($73,400). 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, 2023 and (iv) any other portion required to be excluded by lowa law, and thus such incremental taxes will not include all amounts paid by Developer as regular property taxes. 3.7 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 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 lowa Code (2013) § 403.19(2). 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 2. Section 1 of the Grant Agreement is hereby amended by adding the following: 1.9 Securitv Cameras. Grant Recipient shall install security cameras on the exterior of the Development Property and register said cameras with the "Secure Dubuque Personal Surveillance System" described at https://cityofdubuque.org/2980/Secure- Dubuque. Section 3. Except as modified herein, the Grant Agreement shall remain in full force and effect. CITY OF DUBUQUE, IOWA FORWARD INVESTMENTS GROUP LLC By: gy: Brad M. Cavanagh, Mayor osh J n, Organizer Attest: Adrienne N. Breitfelder, City Clerk 3 CITY OF DUBUQUE, IOWA OFFICIAL NOTICE PUBLIC NOTICE is hereby given that the Dubuque City Council will conduct a public hearing on the 3rd day of June, 2024, 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 First Amendment to Grant Agreement between the City of Dubuque, lowa and Forward Investments Group 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 Forward Investments Group LLC , under the terms and conditions of the Urban Renewal Plan for the Greater powntown 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 $34,034. 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 20th day of May 2024. Adrienne N. Breitfelder, Assistant City Clerk Prepared by/Return to: Ian C. Hatch, Economic Development. 50 W. 13' Street, Dubuque IA 52001, 563 589-4393 RESOLUTION NO. 142-24 FIXING THE DATE FOR A PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA ON A FIRST AMENDMENT TO GRANT AGREEMENT BY AND BETWEEN THE CITY OF DUBUQUE, IOWA AND FORWARD INVESTMENTS GROUP LLC, INCLUDING THE PROPOSED ISSUANCE OF URBAN RENEWAL TAX INCREMENT REVENUE OBLIGATIONS RELATING THERETO, AND PROVIDING FOR THE PUBLICATION OF NOTICE THEREOF WHEREAS, City of Dubuque, Iowa (City) and Forward Investments Group LLC entered into a Grant Agreement, dated the 21 st day of August 2023, providing for a Fagade Grant, a Planning & Design Grant, a Financial Consultant Grant, and a Housing Creation Grant; and WHEREAS, City and Forward Investments Group LLC now desire to amend the Grant Agreement as set forth in the attached First Amendment; and WHEREAS, the City Council has tentatively determined that it would be in the best interests of the City to approve the First Amendment to Grant Agreement with Forward Investments Group LLC, including the issuance of Urban Renewal Tax Increment Revenue Obligations; 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 First 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 3rd day of June, 2024, at 6:30 p.m. The official agenda will be posted on Friday, May 31, 2024 and will contain listening, viewing, and public input options. The City Council agenda may be accessed at https:Hcityofdubuque.novusagenda.com/AgendaPublic/ 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 First Amendment to Grant Agreement relating thereto with Forward Investments Group 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 Forward Investments Group 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 $34,034. 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 20th day of May, 20 Z'___ Ric W. Joe , Mayor Pro Tern Attest: Adrienne N. Breitfelder, City Clerk 2