First Amendment to Development Agreement with CARich Properties, LLC for 1706 Central AvenueCity of Dubuque
Copyrighted
August 19, 2024
Items to be set for Public Hearing #
City Council Meeting 01.
ITEM TITLE:
SUMMARY:
SUGGESTED
DISPOSITION:
ATTACHMENTS:
Description
MVM Memo
Staff Memo
First Amendment
Notice of Public Hearing
Resolution
Setting a Public Hearing fora First Amendment to Development
Agreement by and between the City of Dubuque, Iowa and CARich
Properties, LLC to Redevelop Property at 1706 Central Avenue
City Manager recommending City Council adopt the attached resolution
setting a public hearing for September 3, 2024, for the First Amendment
to Development Agreement between the City of Dubuque and CARich
Properties, LLC for the redevelopment of 1706 Central Avenue.
RESOLUTION Fixing the date for a public hearing of the City Council of
the City of Dubuque, Iowa on a First Amendment to Development
Agreement by and between the City of Dubuque, Iowa and CARich
Properties, LLC, including the proposed issuance of urban renewal tax
increment revenue obligations relating thereto, and providing for the
publication of notice thereof
Receive and File; Adopt Resolution(s), Set Public Hearing for
September 3, 2024Suggested Disposition:
Type
City Manager Memo
Staff Memo
Supporting Documentation
Supporting Documentation
Resolutions
Masterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
Dubuque
All -America City
1IIr
II
2007.2012.2013
2017*2019
SUBJECT: Setting a Public Hearing for a First Amendment to Development
Agreement by and between the City of Dubuque, Iowa and CARich
Properties, LLC to Redevelop Property at 1706 Central Avenue
DATE: August 13, 2024
Economic Development Director Jill Connors is recommending City Council adopt the
attached resolution setting a public hearing for September 3, 2024, for the First
Amendment to Development Agreement between the City of Dubuque and CARich
Properties, LLC for the redevelopment of 1706 Central Avenue.
The First Amendment to Development Agreement provides for the following incentives:
1. The City commits to a Housing Creation Grant of $110,000 (11 units x $10,000
per unit) through the Downtown Housing Creation Program for apartments that
meet the City of Dubuque's Housing Rehabilitation Standards and that receive a
certificate of occupancy.
2. The City commits to a Housing TIF Affordable Unit Creation Grant of $110,000
(11 units x $10,000 per unit) through the LMI Housing Assistance Program for
each rental unit that qualifies for LMI housing creation and receives a Certificate
of Completion up to a maximum of eleven (11) apartments. To qualify, the
housing units must meet the definitions outlined by Iowa Code Section
403.17(12) and 403.17(14).
3. The City commits to 15 years of Tax Increment Financing rebates estimated to
not exceed $106,000.
Previously committed Facade, Design & Planning, and Financial Consultant grants
totaling up to a maximum of $35,000 continue to remain committed to the project.
Additionally, the Developer must accept applications from prospective tenants with
housing choice vouches that are otherwise qualified prospective tenants.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
wh
Michael C. Van Milligen
MCVM:sv
Attachment
cc: Crenna Brumwell, City Attorney
Cori Burbach, Assistant City Manager
Jill Connors, Economic Development Director
2
Masterpiece on the Mississippi
Dubuque
ketri
All -America Cily
11111.1
2007*2012*2013
2017*2019
TO: Michael C. Van Milligen, City Manager
FROM: Jill M. Connors, Economic Development Director
Economic Development
Department
50 West 13th Street
Dubuque, Iowa 52001-4864
Office (563) 589-4393
TTY (563) 690-6678
http://www.cityofdubuque.org
SUBJECT: Setting a Public Hearing for a First Amendment to Development
Agreement by and between the City of Dubuque, Iowa and CARich
Properties, LLC to Redevelop Property at 1706 Central Avenue
DATE: August 13, 2024
INTRODUCTION
This memorandum presents for City Council consideration and action the attached
Resolution setting a public hearing for a First Amendment to Development Agreement
between the City of Dubuque and CARich Properties, LLC.
BACKGROUND
City Council previously approved a Development Agreement with CARich Properties,
LLC, dated for reference August 3, 2020, by Resolution No. 241-20. The Agreement
includes a $100,000 Housing Creation Grant as well as a Fagade Grant package up to
$35,000 ($10,000 Fagade Grant, $10,000 Planning & Design Grant, and $15,000
Financial Consultant Grant) to redevelop a vacant, mixed -use building at 1706 Central
Avenue.
DISCUSSION
The rehabilitation of 1706 Central has been a large undertaking requiring further
assistance and changes in design to the project in order to qualify for additional funding.
The Developer has determined the project has the capacity for an additional housing
unit and has committed to making all 11 housing units affordable rentals. Additionally,
since the Development 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 Development Agreement includes 15-
years of tax increment financing for the project.
The First Amendment to Development Agreement provides for the following incentives:
1. The City commits to a Housing Creation Grant of $110,000 (11 units x $10,000
per unit) through the Downtown Housing Creation Program for apartments that
meet the City of Dubuque's Housing Rehabilitation Standards and that receive a
certificate of occupancy.
2. The City commits to a Housing TIF Affordable Unit Creation Grant of $110,000
(11 units x $10,000 per unit) through the LMI Housing Assistance Program for
each rental unit that qualifies for LMI housing creation and receives a Certificate
of Completion up to a maximum of eleven (11) apartments. To qualify, the
housing units must meet the definitions outlined by Iowa Code Section
403.17(12) and 403.17(14).
3. The City commits to 15 years of Tax Increment Financing rebates estimated to
not exceed $106,000.
Previously committed Fagade, Design & Planning, and Financial Consultant grants
totaling up to a maximum of $35,000 continue to remain committed to the project.
Additionally, the Developer must accept applications from prospective tenants with
housing choice vouchers (issued under the U.S. HUD's Section 8 voucher program or a
similar program) that are otherwise qualified prospective tenants.
This project aligns with the City Council goal of Livable Neighborhoods and Housing:
Great Place to Live.
RECOMMENDATION/ ACTION STEP
I recommend the City Council adopt the attached resolution setting a public hearing for
the First Amendment to Development Agreement between the City of Dubuque and
CARich Properties, LLC for the redevelopment of 1706 Central Avenue.
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FIRST AMENDMENT
TO
DEVELOPMENT AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
CARICH PROPERTIES, LLC
This First Amendment to Development Agreement, dated for reference purposes
the day of , 2024, is made and entered into by the City of Dubuque,
Iowa, a municipality ("City"), and CARich Properties, LLC, an Iowa limited liability
company ("Developer"). City and Developer are hereinafter sometimes collectively
referred to as the Parties.
Whereas, City and Developer previously entered into that certain Development
Agreement dated August 3, 2020 (the "Agreement") with respect to the matters specified
therein; and
Whereas, City and Developer desire to modify the Agreement as set forth herein.
NOW THEREFORE, IN CONSIDERATION OF THE MUTUAL TERMS AND
COVENANTS CONTAINED HEREIN, THE RECEIPT AND SUFFICIENCY OF WHICH
ARE ACKNOWLEDGED BY THE PARTIES, THE PARTIES AGREE AS FOLLOWS:
Section 1. Section 1.3 of the Development Agreement is hereby amended to
read as follows:
1.3 Closing. The closing shall take place on the Closing Date which shall
be the 2nd day of September, 2024, or other such date as the parties shall
agree in writing but in no event, shall the Closing Date be later than the 1st
day of November, 2024 without written consent of City in its sole discretion.
Consummation of the Closing shall be deemed an agreement of the parties
to this Agreement that the conditions of Closing shall have been satisfied or
waived.
Section 2. Section 2 of the Development Agreement is hereby amended to read
as follows:
2.1 Required Minimum Improvements. Developer will make a capital
investment of approximately One Million Five Hundred Thousand Dollars
($1,500,000) to improve the Property (the Minimum Improvements). The
Minimum Improvements shall consist of the creation of eleven (11)
apartments.
2.4 Timing of Improvements. Developer hereby agrees that construction
of the Minimum Improvements on the Property shall be commenced within
07152024
thirty (30) days after the Closing Date, and shall be substantially completed
by December 31, 2025. The time frames for performing these obligations
shall be suspended due to unavoidable delays meaning delays, outside the
control of the party claiming its occurrence in good faith, which are the direct
result of strikes, other labor troubles, unusual shortages of materials or
labor, unusually severe or prolonged bad weather, acts of God, fire or other
casualty to the Minimum Improvements, litigation commenced by third
parties which, by injunction or other similar judicial action or by the exercise
of reasonable discretion directly results in delays, or acts of any federal,
state or local government which directly result in extraordinary delays. The
time for performance of such obligations shall be extended only for the
period of such delay.
2.6 Security Cameras. Developer shall install security cameras on the exterior of all
newly constructed buildings on the Property and register said cameras with the "Secure
Dubuque Personal Surveillance System" described at
https://cityofdubuque.org/2980/Secure-Dubuque.
Section 3. Section 3.1 of the Development Agreement is hereby amended to
read as follows:
3.1 Downtown Housing Incentive Grant.
(1) City agrees to provide to Developer, on the terms and conditions set forth
herein, a grant in the amount of One Hundred Ten Thousand Dollars
($110,000.00).
(2) The grant funds shall be paid in Ten Thousand Dollar ($10,000.00)
payments for each market -rate apartment that receives a Certificate of
Completion up to a maximum of eleven (11) market rate apartments.
Section 3 of the Development Agreement is hereby amended by adding the following
Sections 3.6, 3.7, 3.8, 3.9, and 3.10:
3.6 Housing TIF Affordable Unit Creation Grant.
(1) City agrees to provide to Developer, on the terms and conditions set forth
herein, a grant in the amount of One Hundred Ten Thousand Dollars
($110,000.00).
(2) The grant shall be paid in Ten Thousand Dollar ($10,000.00) payments for
each rental unit that qualifies for LMI housing creation and receives a Certificate
of Completion up to a maximum of eleven (11) apartments. To qualify, the
housing units must meet the definitions outlined by Iowa Code Section
403.17(12) and 403.17(14).
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3,7 Economic Development Grants to Developer. For and in consideration of
Developer'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 Developer 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
November 1, 2028
November 1, 2029
November 1, 2030
November 1, 2031
November 1, 2032
November 1, 2033
November 1, 2034
November 1, 2035
November 1, 2036
November 1, 2037
November 1, 2038
November 1, 2039
November 1, 2040
November 1, 2041
May 1, 2028
May 1, 2029
May 1, 2030
May 1, 2031
May 1, 2032
May 1, 2033
May 1, 2034
May 1, 2035
May 1, 2036
May 1, 2037
May 1, 2038
May 1, 2039
May 1, 2040
May 1,2041
May 1, 2042
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 Developer (the Developer Tax Increments).
For purposes of calculating the amount of the Economic Development Grants provided
in this Section, the Developer 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, 2021 ($136,230). The Developer
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, 2021 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 To fund the Economic Development Grants, City shall certify to the County prior to
December 1, 2026, its request for the available Developer Tax Increments resulting from
the assessments imposed by the County as of January 1 of that year and each year
thereafter until and including January 1, 2042, to be collected by City as taxes are paid
during the following fiscal year and which shall thereafter be disbursed to the Developer
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on November 1 and May 1 of that fiscal year. (Example: if City so certifies in December,
2026, the Economic Development Grants in respect thereof would be paid to the
Developer on November 1, 2027, and May 1, 2028.)
3.9 The Economic Development Grants shall be payable from and secured solely and
only by the Developer Tax Increments paid to City that, upon receipt, shall be deposited
and held in a special account created for such purpose and designated as the 1706
Central TIF Account of City. City hereby covenants and agrees to maintain its TIF
ordinance in force during the term hereof and to apply the incremental taxes collected in
respect of the Minimum Improvements and allocated to the 1706 Central TIF Account to
pay the Economic Development Grants, as and to the extent set forth in Section 3.2
hereof. The Economic Development Grants shall not be payable in any manner by other
tax increments revenues, or by general taxation or from any other City funds. City makes
no representation with respect to the amounts that may be paid to Developer as the
Economic Development Grants in any one year and under no circumstances shall City in
any manner be liable to Developer so long as City timely applies the Developer Tax
Increments actually collected and held in the 1706 Central TIF Account (regardless of the
amounts thereof) to the payment of the Economic Development Grants to Developer as
and to the extent described in this Section.
3.10 City shall be free to use any and all tax increment revenues collected in respect of
other properties within the Project Area and the remaining actual amount of the property
taxes paid by Developer to City, or any available Developer Tax Increments resulting from
the termination of the annual Economic Development Grants under Section 3.7 hereof,
for any purpose for which such tax increment revenues may lawfully be used pursuant to
the provisions of the Urban Renewal Law, and City shall have no obligations to Developer
with respect to the use thereof.
(1) 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 3.10(1). 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. Such
resolution shall be considered for adoption by the City Council at a public hearing
held on or before December 1st of any year and notice of such hearing shall be
given to Developer at least 30 days prior to the hearing. The resolution shall be
approved by not less than a majority of the total number of members to which the
City Council is entitled. Developer and all other persons having an interest in the
matter shall be given an opportunity to be heard at such hearing and prior to the
adoption of such resolution.
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(a) 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.
(b) 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 §403.19(2).
(c) The right of non -appropriation reserved to City in this Section 3.10(1)
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 4. Section 4.2 of the Development Agreement is hereby amended to
read as follows:
4.2 Operation of Development Property; Public Assistance Source of
Income; Housing Vouchers. For and in consideration of the grant offered
under this Agreement, during the operation of the Property as a rental
residential property, Developer shall accept, or cause to be accepted,
applications from prospective tenants with a public assistance source of
income including but not limited to housing vouchers issued under the U.S.
HUD's Section 8 voucher program or a similar program who are otherwise
qualified prospective tenants. Developer shall not deny any tenant a lease
based on a public assistance source of income. A public assistance source
of income means income and support derived from any tax supported
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federal, state or local funds, including, but not limited to, social security,
supplemental security income, temporary assistance for needy families,
family investment program, general relief, food stamps, and unemployment
compensation, housing choice voucher subsidies and similar rent subsidy
programs. This Section 4.2 shall survive the termination of this Agreement.
If Developer, or Developer's successors or assigns violate the requirements
of this Section 4.2 as determined by the City Manager in the City Manager's
sole discretion after the termination of this Agreement, Developer or
Developer's successors or assigns shall not be eligible for any City financial
assistance programs.
Section 4. All other terms of the Development Agreement, as amended, shall
remain in full force and effect.
CITY OF DUBUQUE, IOWA CARICH PROPERTIES, LLC
By: B
Brad M. Cavanagh, Mayor
ATTEST:
Adrienne N. Breitfelder, City Clerk
6
ris Ric'ard, M. aging member
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 September, 2024, at 6:30 p.m., in the Historic Federal Building,
350 W. 6th Street, 2nd floor, Dubuque, Iowa, at which meeting the City Council proposes
to take action to approve a First Amendment to Development Agreement between the
City of Dubuque, Iowa and CARich Properties, LLC, a copy of which is now on file at the
Office of the City Clerk, City Hall, 50 W 13th Street, Dubuque, Iowa, 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 Downtown Urban Renewal Area Economic
Development Area, consisting of the funding of economic development grants for CARich
Properties, LLC , under the terms and conditions of the Urban Renewal Plan for the
Greater Downtown Urban Renewal Area Economic Development Area. 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 $106,000.
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. 13th 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 Iowa by dialing 711 or (800) 735-2942.
Published by order of the City Council given on the 19th day of August 2024.
Adrienne N. Breitfelder, Assistant City Clerk
Prepared by: Ian C. Hatch, Economic Development. 1300 Main Street, Dubuque IA 52001, 563 589-4393
Return to Adrienne N. Breitfelder, City Clerk, 50 W. 13th St., Dubuque, IA 52001, (563) 589-4100
RESOLUTION NO. 257-24
FIXING THE DATE FOR A PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA ON A FIRST AMENDMENT TO DEVELOPMENT AGREEMENT
BY AND BETWEEN THE CITY OF DUBUQUE, IOWA AND CARICH PROPERTIES,
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 CARich Properties, LLC entered into a Development
Agreement, dated the 3rd day of August 2020, providing for a Facade 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 First Amendment to Development Agreement with
CARich Properties, 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 First Amendment to Development 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 September, 2024, at 6:30 p.m. The official agenda will be posted on Friday,
August 30, 2024 and will contain listening, viewing, and public input options. The City
Council agenda may be accessed at
https://cityofdubuque.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 Development Agreement relating
thereto with CARich Properties, 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 CARich Properties, LLC pursuant to the Development
Agreement. It is expected that the aggregate amount of the Tax Increment Revenue
obligations to be issued will be approximately $106,000.
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 19th day of August, 2024.
Brad . avanag ayor
Attest:
Adrienne N. Breitfelder, Assistant City Clerk
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