Cooper Wagon B. - Rehab LoanCITY OF DUBUQUE, IOWA
MEMORANDUM
July 11, 2001
TO:
FROM:
SUBJECT:
The Honorable Mayor and City Council Members
Michael C. Van Milligen, City Manager
Revised Letter of Commitment
Downtown Rehabilitation Loan for Cooper Building
299 Main Street
Acting Economic Development Director Pam Myhre is recommending approval of a
revised Letter of Commitment for the Cooper Development Company, LLC for funding
from the City's Tax Increment Financing funded Downtown Rehabilitation Loan Program
to renovate the former Cooper Wagon Works building at 299 Main Street. Dubuque
Bank and Trust has indicated that they will be requiring a first position on all equipment
as part of their collateral requirements; therefore the City will no longer have any lien on
that equipment.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Pamela Myhre, Acting Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
TO:
FROM:
SUBJECT:
Michael Van
Pamela Myhre, Acting Economic Development Director
Revised Letter of Commitment
Downtown Rehabilitation Loan for Cooper Building
299 Main Street
July 9, 2001
INTRODUCTION
This memorandum presents for City Council consideration a resolution approving a
second revised Letter of Commitment for The Cooper Development Company, LLC for
funding from the City's TIF-funded Downtown Rehabilitation Loan Program to renovate
the former Cooper Wagon Works building at 299 Main Street. This revision is
necessary to adjust the form of secudty required of this loan.
DISCUSSION
On July 2, 2001, the City Council approved by Resolution #293-01 a Letter of
Commitment of $300,000 for this project. That commitment identified the form of
secudty as a "second mortgage lien on the property and a First priority security interest
in equipment." Dubuque Bank and Trust has indicated that they will be requiring a first
position on all equipment as part of their collateral requirements. This was not clear to
staff when the previous revised Letter of Commitment was drafted.
After review by legal staff, the revised Letter of Commitment has been altered to state
that the City will accept a second mortgage lien on the property. This is consistent with
the loan program's requirements.
RECOMMENDATION
I recommend that the City Council adopt the attached resolution appreving the revised
Letter of Commitment which has changed the secudty provisions of the loan to meet the
conditions of private bank financing for this project.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachments
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RESOLUTION NO 328-01
A RESOLUTION AUTHORIZING A REVISED LETTER OF COMMITMENT AND
ADDITIONAL ACTIONS CONCERNING A DOWNTOWN REHABILITATION LOAN TO
THE COOPER DEVELOPMENT COMPANY, LLC.
Whereas, the City of Dubuque, Iowa, has created a Downtown Rehabilitation Loan
Program for the purpose of stimulating reinvestment in the Downtown Dubuque Urban Renewal
District; and
Whereas, the City of Dubuque, Iowa is encouraging the use of this loan program to
finance code compliance activities and to spur job creation activities; and
Whereas, the loan application from The Cooper Development Company, LLC meets the
requirements of this program; and
Whereas, a Commitment Letter, hereto attached and by this reference made a part
hereof, sets forth the terms and conditions of The Cooper Development Company, LLC's
participation in the Downtown Rehabilitation Loan Program.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the application of The Cooper Development Company, LLC for
participation in the Downtown Rehabilitation Loan Program is hereby accepted and approved.
Section 2. That the Mayor is hereby authorized to execute, on behalf of the City
Council of the City of Dubuque, Iowa, the attached revised Commitment Letter and to forward
said letter to The Cooper Development Company, LLC for review and approval.
Section 3. That the City Manager be and he is hereby directed to prepare, upon
execution and receipt of the attached Commitment Letter by the applicant, the necessary loan
documents in accordance with the terms and conditions set forth in said Commitment Letter.
Section 4. That the City Manager is hereby authorized to execute, on behalf of the
City Council of the City of Dubuque, Iowa, all necessary loan documents and is further
authorized to disburse loan funds from the Downtown Rehabilitation Loan Program, in
accordance with the terms and conditions of the executed agreement.
Passed, approved and adopted this 16th day of July, 2001.
Terrance M. Duggan, Mayor
Attest: ~ )
Jeanne F. Schneider, City Clerk
FAUS ERS~Pmyhre~WP DOCS~LOANDOC\Coope~N1/V~rev2cooperbldg.res.rlf
RESOLUTION NO -01
A RESOLUTION AUTHORIZING A REVISED LETTER OF COMMITMENT AND
ADDITIONAL ACTIONS CONCERNING A DOWNTOWN REHABILITATION LOAN TO
THE COOPER DEVELOPMENT COMPANY, LLC.
Whereas, the City of Dubuque, iowa, has created a Downtown Rehabilitation Loan
Program for the purpose of stimulating reinvestment in the Downtown Dubuque Urban Renewal
District; and
Whereas, the City of Dubuque, Iowa is encouraging the use of this loan program to
finance code compliance activities and to spur job creation activities; and
Whereas, the loan application from The Cooper Development Company, LLC meets the
requirements of this program; and
Whereas, a Commitment Letter, hereto attached and by this reference made a part
hereof, sets forth the terms and conditions of The Cooper Development Company, LLC's
participation in the Downtown Rehabilitation Loan Program.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CiTY OF
DUBUQUE, IOWA:
Section 1. That the application of The Cooper Development Company, LLC for
participation in the Downtown Rehabilitation Loan Program is hereby accepted and approved.
Section 2. That the Mayor is hereby authorized to execute, on behalf of the City
Council of the City of Dubuque, Iowa, the attached revised Commitment Letter and to forward
said letter to The Cooper Development Company, LLC for review and approval.
Section 3. That the City Manager be and he is hereby directed to prepare, upon
execution and receipt of the attached Commitment Letter by the applicant, the necessary loan
documents in accordance with the terms and conditions set forth in said Commitment Letter.
Section 4. That the City Manager is hereby authorized to execute, on behalf of the
City Council of the City of Dubuque, Iowa, all necessary loan documents and is further
authorized to disburse loan funds from the Downtown Rehabilitation Loan Program, in
accordance with the terms and conditions of the executed agreement.
Passed, approved and adopted this 16th day of July, 2001.
Attest:
Terrance M. Duggan, Mayor
Jeanne F. Schneider, City Clerk
F:\USE RS~.°myhre\WPDOCS~OAN DOC~CooperWW~ev2cooperbldg.res.r tf
Office of the Mayor
and City Council
City Hall, SO West 13th Street
Dubuque, Iowa 52001-4864
July 16, 2001
The Cooper Development Company, LLC
475 Valeda Street
Dubuque, Iowa 52001
RE:
Revised Letter of Commitment/Downtown Rehabilitation Loan Program
Cooper Building, 299 Main Street
Dear Sirs:
I am please to inform you that your application for financial assistance for the historic renovation
of the Cooper Building has been accepted and approved by the Dubuque City Council.
The following offer is made:
Borrower:
The Cooper Development Company, LLC
Purpose of the Loan:
Historic renovation of the extedor facade and historically
significant elements of the interior with remodeling of the
remainder of the interior.
Source of Funds:
Downtown Rehabilitation Loan Program
Amount of Commitment: $300,000
Interest Rate:
Throe percent (3%) per annum
Term of Loan:
Twenty (20) years
Payment Schedule:
Monthly interest only payments shall be required for the first sixty
(60) months of the loan. Monthly principal and interest payments,
amortized over an additional fifteen (15) year period, shall begin
the sixty-first month of the loan.
You may prepay this loan in whole or in part at any time without
penalty.
Form of Security:
The loan shall be secured by a second mortgage lien on the
property.
Service People integrity Responsibility Innovation Teamwork
Page 2
Commitment Letter
Cooper Building
Conditions of this Commitment:
(a) This commitment shall be subject to the developers meeting each of the terms and
conditions of a loan commitment letter dated June 12, 2001 from Dubuque Bank and
Trust Company and actually receiving the funding offered in said letter.
(b)
An "after rehab" appraisal satisfactory to the Economic Development Department prior to
loan closing. The cost of said appraisal shall be incurred by the property owner.
(c)
A title opinion satisfactory to the Economic Development Department completed at the
expense of the property owner. A copy of said document must be provided prior to loan
closing.
(d)
All exterior work must be reviewed and approved by the City's Historic Preservation
Commission.
(e) A loan agreement must be signed no later than August 31, 2001.
(f)
The project must be completed in accordance with the regulations set forth for the City of
Dubuque's Downtown Rehabilitation Loan Program.
(g)
Loan proceeds shall be disbursed on a pro rata basis with Dubuque Bank and Trust
Company loan disbursements (e.g., one (1) City loan dollar for each five (5) Dubuque
Bank and Trust loan dollars).
(h)
City must also be a party to the $200,000 escrow agreement required by Dubuque Bank
and Trust and specifically consent to any release of escrowed funds.
Additional Commitments:
(a) A grant not to exceed ten thousand dollars ($10,000) will be available to offset
documented predevelopment costs, architectural and engineering fees and other
miscellaneous soft costs. A determination must be made by the City that the project is
substantially complete and satisfies the conditions of the loan prior to the release of any
grant monies.
(b)
Two thousand dollars ($2,000) of this loan will be forgiven for each new full-time job or
full-time equivalent created within two years of the execution of the loan documents and
maintained by the applicant or his/her tenant for a period of not less than three years.
The amount of the loan to be forgiven shall be determined by the City on the fifth
anniversary of the loan based on documented evidence of job creation.
This commitment is valid for twenty-one (21) days from the date of this letter. If you wish to
accept the offer, you must return the acknowledgment. Failure to return wdtten
acknowledgment will be cause for the commitment to lapse. This commitment offer shall lapse
if construction on the proposed project does not start within ninety (90) days of the loan closing.
Page 3
Commitment Letter
Cooper Building
If the terms offered do not meet your approval, or if you have any questions regarding the
conditions of this commitment, please contact Pamela Myhre, Economic Development
Department, at 319/589-4393.
Sincerely,
Terrance M. Duggan
Mayor
We have reviewed the above offer and accept the Downtown Rehabilitation Loan and all of the
terms of this commitment letter,
Scott A. Neuwoehner, Managing Partner
The Cooper Development Company, LLC
Date
Greg A. Prehm
The Cooper Development Company, LLC
Date
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