Plastic Center Inc. Downtown Facade Grant 951_965 MainTHE CITY OF DUBUQUE
Masterpiece on the Mississippi
Dubuque
All-American City
2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Downtown Rehabilitation Loan, Design Grant, and Facade Grant for
951, 955-957, and 965 Main Street
DATE: December 27, 2007
Economic Development Director Dace Heiar recommends City Council approval of a
letter of commitment for a Downtown Rehabilitation Loan of $300,000, Design Grant for
$10,000, and a Facade Grant of $10,000 for Plastic Center, Inc. to support their
rehabilitation of properties located at 951, 955-957, and 965 Main Street. These three
buildings will be restored with three commercial tenants and five market rate apartments
above, making this an important catalyst project.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
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Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
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TO: Michael Van Milligen, City Manager
December 27, 2007
FROM: David J. Heiar, Economic Development Director
SUBJECT: Downtown Rehabilitation Loan, Design Grant, and Facade Grant for
951, 955-957, and 965 Main Street
INTRODUCTION
This memorandum presents for City Council consideration a Resolution approving a
letter of commitment for a Downtown Rehabilitation Loan of $300,000, Design Grant for
$10,000, and a Facade Grant of $10,000 for Plastic Center, Inc. to support their
rehabilitation of properties located at 951, 955-957, and 965 Main Street (The Betty
Jane Buildings).
BACKGROUND
The Downtown Rehabilitation Loan/Grant Program encourages private investment and
rehabilitation efforts in the City's Greater Downtown Urban Renewal District's Old Main,
Town Clock Plaza, Upper Main, South Main, and Warehouse sub areas. The program,
capitalized with funds available through the City's tax increment financing district,
provides for a maximum of $300,000 in attractive low-interest loan monies. The program
is unique in that grants of up to $10,000 are available to offset costs for Facade
improvements and design costs. The program also includes a forgivable loan element
whereby qualifying applicants may have up to the full amount of the loan forgiven as an
incentive for the creation of new employment and housing opportunities in the district.
DISCUSSION
These 3 buildings will be restored with 3 commercial tenants and 5 market rate
apartments above making this an important catalyst project to Dubuque Main Street
Initiatives. Revitalization in the 900 block will help connect areas on Main St. to the
north and south that have had revitalization investment.
The renovations planned to be made by Plastic Center, Inc. are as follows:
Exterior-masonry to be cleaned and restored, new or restored windows, store
fronts, new roof systems, new rear decks/exit stairs, new utilities
Interior-structural repair and replacement, updated life safety, environmental
remediation, new mechanicals and new build outs
At this time, insufficient loan funds are available in the Downtown Rehabilitation Loan
Program to fund the loan. The owners have agreed to wait until the funds are available
in FY2015. As of July 1, 2014, the loan funds should be available to the project and the
company would like to proceed with the loan. Recapitalizations for this program have
been included into the City's Capital Improvements Program. Should the
recapitalization schedule be altered, the timing for the availability of loan funds may
change.
Additional information on the terms and conditions of the proposed Downtown
Rehabilitation Loan/Grant is attached in the commitment letter. If the loan is approved
by the City Council, this commitment letter would be executed by the Mayor and by the
owners.
RECOMMENDATION
Staff has reviewed the application and found it to be in keeping with the requirements of
the Downtown Rehabilitation Loan/Grant Program. The project is scheduled to begin in
early 2008.
I recommend that the City Council adopt the attached Resolution approving a letter of
commitment for 951, 955-957, and 965 Main Street for the $300,000 Downtown
Rehabilitation loan, $10,000 facade grant, and $10,000 design grant.
ACTION STEP
The action step for the City Council is to adopt the attached Resolution.
F:IUSERS\Adejong\Downtown Rehab Loan\951 Main Street (betty jane)\20071227 DRLP Memo.doc
RESOLUTION NO. 9-08
A RESOLUTION AUTHORIZING A LETTER OF COMMITMENT AND
ADDITIONAL ACTIONS CONCERNING A DOWNTOWN REHABILITATION
LOAN, DESIGN GRANT AND FACADE GRANT TO 951, 955-957, AND 965
MAIN STREET.
Whereas, the City of Dubuque, Iowa, has created a Downtown Rehabilitation
Loan/Grant Program for the purpose of stimulating reinvestment in the Greater
Downtown Urban Renewal District; and
Whereas, the City of Dubuque, Iowa is encouraging the use of this loan/grant
program to finance code compliance activities and to spur job creation activities; and
Whereas, the loan application from Plastic Center, Inc. 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 Plastic Center, Inc. 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 Plastic Center, Inc. for participation in the
Downtown Rehabilitation Loan and Grant 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 Plastic Center, Inc. for review and approval.
Sec•~ior~ 3. That tiie City iJiandge~ ue a~;d . e is "ereby directed to preNare,
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/Grant
Program, in accordance with the terms and conditions of the executed agreement.
Passed, approved and adopted this 7th day of January, 2008.
Roy D. Buol, Mayor
Attest: Jeanne F. Schneider, City Clerk
F:\USERSWdejong\Downtown Rehab Loan\951 Main Street (betty jane)\20080107 DRLP Resolution.doc
Economic Development Department
City Hall -Second Floor
50 West 13th Street
Dubuque, Iowa 52001-4864
(563) 589-4393 office
(563) 589-1733 fax
(563) 690-6678 TDD
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January 8, 2008
Plastic Center Inc.
Attn: Tony Pfohl
290 Main Street
Dubuque, Iowa 52001
RE: Letter of Commitment/Downtown Rehabilitation Loan Program
951, 955-957, and 965 Main Street
Dear Mr. Pfohl:
I am pleased to inform you that your application for financial assistance for the renovation of
951, 955-957, and 965 Main Street 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: $300,000
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 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:
Purpose of the Loan:
Conditions of this Commitment:
The loan shall be secured by a second mortgage on the
property.
Renovation of the exterior facade and interior for use as
commercial and residential space.
(a) As of July 1, 2014, the loan funds should be available to fund the project and the
company would still like to proceed with the loan. Recapitalizations for this program have
Service People Integrity Responsibility Innovation Teamwork
been included into the Citys Capital Improvements Program. Should the recapitalization
schedule be altered, the timing for the availability of loan funds may change.
(b) A title opinion must be completed at the e~ense of the property owner. A copy of said
document must be provided at the loan closing.
(c) A loan agreement must be signed prior to the loan funds being dispersed.
(d) The project is to be completed in accordance with the raegulations 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 construction costs for facade improvements. 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 grant not to exceed ten thousand dollars ($10,000) will be available to offset the
actual pre-development costs incurred by Rehabilitation Loan Program participants.
(c) 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 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. Any
jobs relocated from another location within the downtown area will not count as a new
job.
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 written 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 after the loan closing.
If the terms offered do not meet your approval, or if you have any questions regarding the
conditions of this commitment, please contact Daud Heiar, Economic Development Department,
at 589-4393.
Sincerely,
Roy D. Buol
Mayor
ACKNOWLEDGMENT
We have reviewed the above offer and accept the $300,000 Downtown Rehabilitation
Loan, $10,000 Design Grant and the $10,000 Facade Grant and all of the terms of this
commitment letter.
Tony Pfohl
Date
F:\USERSWdejong\Downtown Rehab Loan\951 Main Street (betty jane)\20080108 DRLP approval letter.doc
City of Dubuque Application for,
Downtown Rehabilitation Loan program
Facade and Design Grants
Attention: Economic Development Department
Applicant:
Plastic Center Inc.
290 Main St
Dubuque, Iowa 52001
Phone (563) 583-3526
Fax (563) 582-6428
FEID# 11-155-255-8
Property Addresses - 951, 955-957, 965 Main Street Dubuque
Project Description and how proiect will further downtown revitalization:
The 900 Block Revitalization Project consists of 3 buildings. All are Main Street
buildings with 1St floor commercial and residential above.
All three buildings will be fully renovated
Exterior-masonry to be cleaned and restored, new or restored windows, store fronts, new
roof systems, new rear decks/exit stairs, new utilities
Interior-structural repair and replacement, updated life safety, environmental
remediation, new mechanicals and new build outs
Note we will be using State and Federal Historic Tax Credits so special attention will be
given to character defining features.
The owners would like this project to be as sustainable as possible so attention will be
given to; 1. Demolition process-organize sorting of materials for recycling of building
materials/reuse 2. Building envelope details reflective roofing, foam insulation and
cellulose 3. Mechanicals- high efficient HVAC 4.Water efficient toilets, showerheads,
etc. 5. Materials with longer life cycles.
Downtown Revitalization
The 900 Block has had little investment. The block on both sides of the street is blighted
and in need of investment. These 3 buildings restored with 3 commercial tenants
retail/entertainment and 5 market rate apartments above will be an important catalyst
project vital to Dubuque Main Street Initiatives. Revitalization in the 900 block will help
connect areas on Main St. to the north and south that have had revitalization investment.
This will help to connect these areas and produce more synergy and continuity to the
long-term Main Street revitalization plan.
Employment and Housing unit elements:
Conservative temporary employment from construction, estimate = 12
Permanent job creation estimate = 14
Housing units = 5 new, 2 bedroom apartments
Amount of Loan Requested: $300,000 Rehabilitation Loan, $10,000 Facade and $10,000
Design Grant.
Security on Loan -Second Mortgage holder
Proiect Budget: Attached in email
Preliminary Construction Schedule:
December 2007 -Masonry Restoration work begins
February 2008 -Heavy interior/exterior renovation begins
September 2008 -Construction work completed
Financial Statements: Projected Income Statement and Cash Flow attached in email