Grand Opera Downtown Rehab LoanMEMORANDUM
September 10, 2001
TO:
FROM:
SUBJECT:
The Honorable Mayor and City Council Members
Michael C. Van Milligen, City Manager
Downtown Rehabilitation Loan for Grand Opera House 135 8th Street
Acting Economic Development Director Pam Myhre is recommending approval of a
request from the Grand Opera House Foundation for funding from the City's TIF-funded
Downtown Rehabilitation Loan Program in the amount of $73,000 to complete the
renovation of the front fagade of the Grand Opera House located at 135 8th Street.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Pamela Myhre, Acting Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
September 7, 2001
TO:
FROM:
SUBJECT:
Michael Van Milligen, City Manager
Pamela Myhre, Acting Economic Development Director
Downtown Rehabilitation Loan for Grand Opera House
135 8th Street
INTRODUCTION
This memorandum presents for City Council consideration a resolution approving a
request from the Grand Opera House Foundation for funding from the City's TIF-funded
Downtown Rehabilitation Loan Program to complete the renovation of the front facade
of the Grand Opera House located at 135 8th Street. This would be the second loan
from the loan pool for this property.
BACKGROUND
The Downtown Rehabilitation Loan Program, capitalized with funds available through
the City's tax increment financing district, now provides for a maximum of $300,000 in
attractive Iow-interest loan monies. The program has never provided two loans for a
single property; however, the total loan amount for both loans for the Grand Opera
House building would be less than the maximum allowed. Funds remaining in the loan
pool, if this loan is approved, will be available only to cover the outstanding grants made
available through this program for existing loan recipients. No new loans could be
made until additional funds are available through the yearly CIP budget.
DISCUSSION
In 1997, the City Council provided a $100,000 loan from the Downtown Rehabilitation
Loan Program to the Grand Opera House to assist in the overall renovation of their
building. The work is now almost complete and the Foundation has requested an
additional $73,000 to complete the stone restoration on the front fa(;ade of the building.
The project will commence in late September and is scheduled for completion by
November 2001. A copy of the application for loan funds for the project is attached.
Financial reports for the Foundation have been submitted and reviewed by staff. With
the exception of the City loans, no other debt is outstanding on this building. Additional
information on the terms and conditions of the proposed Downtown Rehabilitation Loan
is attached in the commitment letter. If the loan is approved by the City Council, the
commitment letter would be executed by the Mayor and the Grand Opera House
Foundation.
RECOMMENDATION
Staff has reviewed the application and found it to be in keeping with the requirements of
the Downtown Rehabilitation Loan Program. I recommend that the City Council adopt
the attached resolution approving the Grand Opera House Foundation's request for
$73,000 and authorizing the preparation and execution of the necessary loan
agreement. The resolution directs the City Manager to prepare and execute the final
documents as per the terms and conditions of the attached commitment letter.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachments
F:\USERS\Pmyhre\WPDOCS\LOANDOC\SECUR]TY~grandfound.mem.doc
August 30, 2001
Ms. Pamela Myhre
Community and Economic Development Department
50 West 13~ Street
Dubuque, IA 52001-4393
Dear Para,
Please allow this letter to serve as our application for a loan through the Downtown Rehabilitation
Loan Program.
Specific information about our project is as follows:
· ~l~ae project is for the Grand Opera House located at 135 8~h Street, Dubuque, Iowa.
The project includes replacement and repair of decorative, cut, sandstone bands and
features on the south fagade of the Grand Opera House. The project will repair the stone
bands that were damaged when the faqade was being prepared to receive the flat metal
panels in the 1950's.
The Stone to be used on tlfis project will replicate the color, texture and shape of
the original faqade. Great care will be given to replicate the shape of each piece of
stone so that the final result will be an accurate restoration of the original faqade.
Upon completion of this project the south fagade of the bu/lding will be restored to
its original historic appearance.
This building stands as a significant part of historical downtown Dubuque. The building
is a beautiful representation of Dubuque's history and glory. It serves as a vital element
of the culture and theatre in Dubuque.
· We have previously furnished a warranty deed and appraisal of the property in
connection with our previous application.
· The city of Dubuque currently has a mortgage on the property also in connection with
our previous application.
Business Office
019) 588-4356
www, thegrandoperahouse~com
135 8th Street · P.O. Box 632 · Dubuque, Iowa 52004-0632
Fax: (319) 588-3497
Box Office
(319) 588-1305
~lEae estimated cost of this project is $73,000.00 Labor and materials are estimated at
$70,000.00 and construct/on management fees of $3,000.00.
We expect to start this project in late September, 2001, with completion in November,
2001.
We request a loan of $73,000.00.
Enclosed please find a copy of our current financial statement. We intend to pay off this
loan as we collect pledges from our current fund drive.
We look forward to completing this project with the assistance of this loan program. Please let us
know if you have any questions or concerns.
Sincerely,
Michael P. Brmmon
President
Grand Opera House
Treasurer
Grand Opera House Foundation
Enclosures
SJB:jkb
Business Office
(319) 588-4356
www.thegrandoperahouse.com
135 8th Street · P.O. Box 632 · Dubuque, Iowa 52004-0632
Fax: (319) 588-3497
Box Office
(319) 588-1305
RESOLUTION NO. 399-01
A RESOLUTION AUTHORIZING A LETTER OF COMMITMENT AND
ADDITIONAL ACTIONS CONCERNING A DOWNTOWN REHABILITATION
LOAN TO THE GRAND OPERA HOUSE FOUNDATION.
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 loan application from the Grand Opera House Foundation 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 Grand Opera House Foundation'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 Grand Opera House Foundation 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 Commitment Letter and to
forward said letter to the Grand Opera House Foundation 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 17th day of September, 2001.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, City Clerk
F:\USERS~Pmyhre\WPDOCS%OANDOC~SECURITY~grandfound.res.doc
John E. Butler, President
Grand Opera House Foundation
P.O. Box 632
Dubuque, Iowa 52004-0632
September 7, 2001
RE: Letter of Commitment/Downtown Rehabilitation Loan Program
Grand Opera House, 135 8th Street
Dear Mr. Butler:
t am please to inform you that your application for financial assistance to continue the
historic renovation of the Grand Opera House has been accepted and approved by the
Dubuque City Council.
The following offer is made:
Source of Funds:
Downtown Rehabilitation Loan Program
Amount of Commitment: $73,000
Interest Rate:
Three 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 pdncipat 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 (City has first mortgage position already) or other
secudty instrument that will satisfy the outstanding balance
associated with this loan.
Commitment Letter
Grand Opera House Project
Page 2
Purpose of the Loan:
Completion of the historic renovation the south fa~;ade to
repair stone.
Conditions of this Commitment:
(a)
A title opinion must be completed at the expense of the property owner. A copy
of said document must be provided at the loan closing.
(b)
All exterior work must be reviewed and approved by the City's Historic
Preservation Commission.
(c) A loan agreement must be signed no later than October 30, 2001.
(d)
The project is to be completed in accordance with the regulations set forth for the
City of Dubuque's Downtown Rehabilitation Loan Program.
Additional Commitments:
(a) A grant not to exceed ten thousand dollars ($10,000) will be available to offset
documented predevelopment costs, amhitectural 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)
A rebate equal to two thousand dollars ($2,000) may 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
pedod 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.
Commitment Letter
Grand Opera House Project
Page 3
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 Depar[ment, at 563/589-4393.
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.
John E. Butler, President
Grand Opera House Foundation
Date
Stephen J. Bonfig, Treasurer
Grand Opera House Foundation
Date
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