Assistance Pool to Encourage Residential Housing in Downtown756 N. Main Street
Hippocrene Enterprises, LLC
(Walker Shoe Store)
4
$40,000
Grant
129 Main Street
K & E Partnership LLP
(Knippels Religious Gifts)
2
$12,000
Grant
163 Main Street
D & J Realty
3
$30,000
Grant
392 -394 Bluff Street
RMF Associates, LLC
2
$10,000
Grant
205 Bluff Street
B &C Cathedral
Development, LLC
(St. Raphael School)
24
$224,000
Low - Interest
Loan
0
Masterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Assistance Pool to Encourage Residential Housing in Downtown
DATE: April 13, 2010
Dubuque
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In November 2009, Economic Development Director Dave Heiar recommended that a
pool of funds in the amount of $2.5 million be created to encourage new residential
housing units in downtown Dubuque and that a Request for Proposals be solicited from
developers who are interested in renovating existing structure in the downtown.
The City Council, on November 19, 2009, approved an assistance pool of funds to
encourage creation of new market -rate housing within the Greater Downtown Urban
Renewal District. The City received 15 applications for assistance. Of those, 5 projects
were approved for assistance. They are:
Address
Developer
Housing Units Assistance
After funding the first 5 projects, $2,184,000 is still available in the incentive program to
encourage new housing units in the urban renewal district. Attached is an RFP for a
second round of applications. Based on the initial experience the requirements and
incentives have been amended from the first incentive program. The unchanged
requirements are as follows:
• The project must assist in the creation of new market -rate downtown rental and
owner - occupied residential units within the Greater Downtown Urban Renewal
District.
• The project must be the rehabilitation of an existing structure.
• No more than $10,000 per residential unit in assistance will be considered.
• No more than $750,000 will be provided to a single project.
• No developer fee will be permitted until all city assistance is paid or satisfied in
full.
The modified or new requirements are as follows:
• The project must be under construction by August 1, 2010, with at least 25% of
the project completed by December 31, 2010.
• The units created must be completed and ready for occupancy by July 1, 2011.
• A minimum of 4 new housing units must be created in the project.
• The City will disperse awarded funds for the benefit of the project once the
project is completed and a Certificate of Occupancy has been given for the
housing units.
• Units smaller than 500 square feet will not be eligible for this project.
• Each approved project will also be eligible to receive site - specific Tax Increment
Financing (TIF) for a 15 year period, depending on the project scope.
• No more than 50% of the units of any project can have a restriction of 80% of the
median income.
• No units can have a restriction of less than 80% of the median income.
The assistance available through the fund may take several different forms, including
but not limited to:
• Low - Interest Loans
• Grants
Also available to developers is the Downtown Rehabilitation Loan program which has
two grants associated with it, Planning & Design and Facade, that are available to assist
projects in conjunction with the loan of up to $300,000. A backlog of approved projects
waiting for their loans are also waiting for the grants. Several of these projects are
completed and have fulfilled the requirements of the grants. Funds are available within
their respective CIP budgets to fund the committed grants.
For the grants associated with the Downtown Rehabilitation Loan Program, the current
policy is to tie these incentive funds to the Downtown Loan Program. Because of this
policy, the backlog with the loan program has unnecessarily created a backlog on the
grant programs, even though the city has a balance of funds available in the grant
programs. Today, $77,964 remains in the grant funding pool with another $50,000
scheduled to be added to this CIP in the FY 2011 budget.
Looking at the list of approved grants, all projects completed or planned to be
completed this year could all be paid after July 1 and the fund would still have $37,964
remaining.
Between existing employers and some new employers arriving in Dubuque, there is
going to be a need for about 600 -1,000 new rental unit in the community. Much of that
need will be in downtown, with IBM hiring 1,300 people that will be housed in the
Roshek Building.
There are already thousands of jobs in our downtown. Creating downtown housing
supports downtown retail and restaurant development and allows people to walk to
work. This supports the Downtown Master Plan and the Historic Millwork Master Plan.
I respectfully recommend Mayor and City Council approval of the issuance of the
Request for Proposal, and to modify the payout of the Planning and Design and the
Facade Grant Programs.
Michael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
Vb
Masterpiece on the Mississippi
TO: Michael Van Milligen, City Manager
FROM: David J. Heiar, Economic Development Director i
SUBJECT: Assistance Pool to Encourage Residential Housing in Downtown
DATE: April 12, 2010
INTRODUCTION
This memo is to provide a second round of funding to encourage new residential
housing units in downtown Dubuque and to make changes to the Downtown
Rehabilitation Loan and Grant program.
Dubuque
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I
2007
BACKGROUND
Dubuque has been successful in encouraging job creation in the community for several
years. Several great projects have begun or continue this year including:
• IBM is currently hiring new employees to reach 1,300 employees in Dubuque by
the end of 2010. Many new hires are coming from outside the community.
• Hormel Foods began operations this winter in their facility on Chavenelle Court.
• Medline Industries has been growing steadily and has additional capacity in their
new facility. Corporate management is committed to growing the operation in
Dubuque.
The City does not want to reduce the ability of our existing businesses in Dubuque from
expanding or replacing employees because of the lack of housing.
In seeing this influx of new positions coming to Dubuque and with the employee
recruitment of other existing businesses, the Greater Dubuque Development
Corporation (GDDC) has hired Shannon Gaherty as the Newcomer Relations
Coordinator. Her job is to help new residents find housing, get information about the
community, and get connected with services and organizations within the community.
GDDC has expressed difficulties in finding quality housing, particularly in the downtown
area. Many of Dubuque's new residents have a strong desire to live near work and
entertainment. This desire needs to be met for Dubuque businesses to attract and
retain a quality workforce.
A pool of housing incentive funds was generated by delaying approved CIP projects and
the funding was used to borrow approximately $2.5 million for this program. The
following is a list of CIP projects reduced or delayed to facilitate the borrowing:
• Port of Dubuque Improvements
756 N. Main Street
Hippocrene Enterprises, LLC
(Walker Shoe Store)
4
$40,000
Grant
129 Main Street
K & E Partnership LLP
(Knippels Religious Gifts)
2
$12,000
Grant
163 Main Street
D & J Realty
3
$30,000
Grant
392 -394 Bluff Street
RMF Associates, LLC
2
$10,000
Grant
205 Bluff Street
B &C Cathedral
Development, LLC
(St. Raphael School)
24
$224,000
Low - Interest
Loan
• Millwork District Street Reconstruction
• Millwork District Streetscape Improvements
• Millwork District Fiber Optics
• $100,000 not needed for demolition of a portion of the old Tri -State building being
purchased from the Iowa DOT
• Approximately $45,000 savings per year in the Greater Downtown Urban
Renewal District from the refinancing of America's River bonds
The City Council, on November 19, 2009, approved an assistance pool of funds to
encourage creation of new market -rate housing within the Greater Downtown Urban
Renewal District. The City received 15 applications for assistance. Of those, 5 projects
were approved for assistance. They are:
Address
Developer
Housing Units Assistance
Downtown Loan /Grant Program
The Downtown Rehabilitation Loan program has two grants associated with it, Planning
& Design and Facade, that are available to assist projects in conjunction with the loan of
up to $300,000. A backlog of approved projects waiting for their loans are also waiting
for the grants. Several of these projects are completed and have fulfilled the
requirements of the grants. Funds are available within their respective CIP budgets to
fund the committed grants.
DISCUSSION
After funding the first 5 projects, $2,184,000 is still available in the incentive program to
encourage new housing units in the urban renewal district. Attached is an RFP for a
second round of applications. Based on our initial experience the requirements and
incentives have been amended from the first incentive program. The unchanged
requirements are as follows:
• The project must assist in the creation of new market -rate downtown rental and
owner - occupied residential units within the Greater Downtown Urban Renewal
District.
• The project must be the rehabilitation of an existing structure.
• No more than $10,000 per residential unit in assistance will be considered.
• No more than $750,000 will be provided to a single project.
• No developer fee will be permitted until all city assistance is paid or satisfied in
full.
The modified or new requirements are as follows:
• The project must be under construction by August 1, 2010, with at least 25% of
the project completed by December 31, 2010.
• The units created must be completed and ready for occupancy by July 1, 2011.
• A minimum of 4 new housing units must be created in the project.
• The City will disperse awarded funds for the benefit of the project once the
project is completed and a Certificate of Occupancy has been given for the
housing units.
• Units smaller than 500 square feet will not be eligible for this project.
• Each approved project will also be eligible to receive site - specific Tax Increment
Financing (TIF) for a 15 year period, depending on the project scope.
• No more than 50% of the units of any project can have a restriction of 80% of the
median income.
• No units can have a restriction of less than 80% of the median income.
The assistance available through the fund may take several different forms, including
but not limited to:
• Low - Interest Loans
• Grants
City staff selected by the City Manager will be charged with evaluating the proposals
with the ultimate task to select projects which create new market -rate rental and owner -
occupied residential units in the Greater Downtown Urban Renewal District at the lowest
per unit cost to the fund. Per unit cost to the fund will be calculated based upon the
structure of the assistance required for the project. One of the City's goals is to leverage
the most private investment with the least public assistance. The City Manager will
make a recommendation to the City Council and the City Council will make the final
awards. The terms of the award and the City's obligation to provide financial assistance
to a project will be set forth in a development or loan agreement between the City and
successful applicant.
Some of the proposed funding for this incentive program has been committed as
local match for grant applications. If any of these federal grants are approved,
the pool of funds available for this incentive program will be reduced accordingly.
Eligible projects to use this new financing pool need not be directly used for housing unit
creation. The identified project must be a required component related to housing unit
creation (i.e. parking).
An RFP requesting proposals from developers or property owners will need to be
immediately available. In order to expedite the creation of housing units, proposals
should be delivered to the Economic Development Department no later than Noon on
May 24, 2010. Staff will review the proposals and discuss them with the City Manager.
The City reserves the right to reject any and all proposals and to negotiate changes with
any applicant. The City Manager will then provide a recommendation to the City
Council.
Downtown Loan /Grant Program
For the grants associated with the Downtown Rehabilitation Loan Program, the current
policy is to tie these incentive funds to the Downtown Loan program. Because of this
policy, the backlog with the loan program has unnecessarily also created a backlog on
the grant programs, even though the city has a balance of funds available in the grant
programs. Today, $77,964 remains in the grant funding pool with another $50,000
scheduled to be added to this CIP in the FY2011 budget.
Looking at the list of approved grants, all projects completed or planned to be
completed this year could all be paid after July 1 and the fund would still have $37,964
remaining.
RECOMMENDATION
I recommend that the City Council approve the attached resolution approving the RFP
for a second round of applications to the Downtown Housing Incentive Program. I also
recommend that the City modify its policy to allow payment of grants associated with the
Downtown Rehabilitation Loan Program to projects as they are completed and as soon
as funds are available.
ACTION STEP
The action step is to approve the attached resolution authorizing these changes.
F: \USERS\Econ Dev \Downtown Housing\20100412 Housing RFP #2 Memo.doc
CITY OF DUBUQUE, IOWA
April 19, 2010
SECOND REQUEST FOR PROPOSALS
Assistance to Encourage Market -Rate Downtown Rental and Owner - Occupied
Residential Units - $2,184,000 estimated to be available.
INTRODUCTION
The City of Dubuque, Iowa is soliciting proposals from developers and property owners to
expand the availability of market -rate downtown rental and owner - occupied residential
units.
HISTORY /BACKGROUND
Recent job creation projects within the City of Dubuque have caused a significant demand
for downtown living options from new residents preferring to live near work and
entertainment opportunities. Recent economic study of housing in the City of Dubuque has
shown unmet demand for this housing type.
The City of Dubuque previously established a pool of funds to be made available to
complete financing packages for the immediate creation of market -rate downtown rental
and owner - occupied residential units within the Greater Downtown Urban Renewal District.
(See attached map for boundaries) Market -rate residential units include rental units which
are not income restricted or rental units that are restricted to 80% of median income and
less for no more than five years (units must not be restricted to 60% of median income or
less, or any other restriction under 80 %) and owner occupied units. Eighty percent of
median income level as determined by the Department of Housing and Urban
Development (HUD), is currently at $35,000 for a single person, $40,000 for two and
$45,000 for three.
Through the first round of the program, the City committed $316,000 in grants and loans to
assist 5 projects. These projects will create 35 downtown market rate residential units.
PROJECT REQUIREMENTS
Projects eligible to receive assistance from this newly established pool of funds must meet
the following requirements:
• The project must assist in the creation of new market -rate downtown rental and
owner - occupied residential units within the Greater Downtown Urban Renewal
District.
• The project must be the rehabilitation of an existing structure.
• The project must be under construction by August 1, 2010, with at least 25% of the
project completed by December 31, 2010.
• The units created must be completed and ready for occupancy by July 1, 2011.
• No more than $10,000 per residential unit in assistance will be considered.
• No more than $750,000 will be provided to a single project.
Second Round - Public Assistance to Encourage Downtown Rental Housing
Page 2
• No more than 50% of the project units may have the 80% of median income or
below restriction.
• A minimum of 4 new housing units must be created in the project.
• Assisted project units may not have a restriction of 60% of median income and
below.
• The City will disperse awarded funds for the benefit of the project once the project is
completed and a Certificate of Occupancy has been given for the housing units.
• No developer fee will be permitted until all city assistance is paid or satisfied in full.
• Units smaller than 500 square feet will not be eligible for this project.
The assistance requested need not be directly used for housing unit creation. However,
the project must be a required component related to housing unit creation (i.e. parking).
STRUCTURE OF ASSISTANCE
The assistance available through the fund may take several different forms, including but
not limited to:
• Low - Interest Loans
• Grants
Each approved project will also be eligible to receive site - specific Tax Increment Financing
(TIF) for a 15 year period, depending on the project scope.
SELECTION CRITERIA
City staff selected by the City Manager will be charged with evaluating the proposals with
the ultimate task to select projects which create new market -rate rental and owner -
occupied residential units in the Greater Downtown Urban Renewal District at the lowest
per unit cost to the fund. Per unit cost to the fund will be calculated based upon the
structure of the assistance required for the project. One of the City's goals is to leverage
the most private investment with the least public assistance. The City Manager will make a
recommendation to the City Council and the City Council will make the final awards. The
terms of the award and the City's obligation to provide financial assistance to a project will
be set forth in a development or loan agreement between the City and successful
applicant.
PROPOSAL REQUIREMENTS
Applicants must complete the attached application. A ten -year detailed financial proforma
is required to accompany the application. The proforma should include project revenues
and expenses by category and a listing of all planned sources of financing to complete the
project. A floor plan for all proposed units must be included with the application.
SUBMISSION REQUIREMENTS
A fully completed application with attachments and exhibits must be received in the office
of the City of Dubuque Economic Development Department, 50 W. 1 3 Street, Dubuque,
Second Round - Public Assistance to Encourage Downtown Rental Housing
Page 3
Iowa 52001 by 12:00 p.m. CDT Monday, May 24, 2010.
Proposals should be addressed to David Heiar, Economic Development Director, at the
above address. Questions can be directed to David Heiar or Aaron DeJong by telephone at
(563) 589 -4393, by fax at (563) 589 -1733, or by email at dheiaraAcitvofdubuque.orq or
adeiongc citvofdubuque.org.
Each applicant assumes full responsibility for delivery and deposit of the completed
proposal package on or before the deadline. The City of Dubuque is not responsible for
any loss or delay with respect to delivery of the proposals. Some of the proposed funding
for this incentive program has been committed as local match for federal grant
applications. If any of these federal grants are approved, the pool of funds available
for this incentive program will be reduced accordingly. The City of Dubuque
reserves the right to reject any and all proposals and to negotiate changes with any
applicant. The City of Dubuque is not liable for any cost incurred by any applicant prior to
the execution of an agreement or contract. Nor shall the City of Dubuque be liable for any
costs incurred by the applicant that are not specified in any contract. The City of Dubuque
is an Equal Employment Opportunity Employer.
Applicants may be invited to an interview to discuss their project in greater detail.
F: \USERS \Econ Dev \Downtown Housing \RFP\20100419 Downtown Housing RFP2.doc
Prepared by: David Heiar, Economic Dev Director, 50 West 13 Street, Dubuque IA 52001 563 589 -4393
Return to: Jeanne Schneider, City Clerk, 50 West 13 Street, Dubuque IA 52001 563 589 -4121
RESOLUTION NO. 120 -10
APPROVING AUTHORIZING THE CITY MANAGER TO SOLICIT PROPOSALS FOR
PROJECTS TO ENCOURAGE MARKET -RATE DOWNTOWN RENTAL AND OWNER -
OCCUPIED RESIDENTIAL UNITS IN THE GREATER DOWNTOWN URBAN RENEWAL
DISTRICT AND APPROVE CHANGES TO THE DOWNTOWN REHABILITATION LOAN
PROGRAM
Whereas, the City of Dubuque has been successful in encouraging job creation and
retention in the community for several years; and
Whereas, many of the City of Dubuque's new residents have a strong desire to live
near work and entertainment; and
Whereas, a significant shortage of quality market -rate rental and owner - occupied
residential units exists and efforts are needed to encourage new development of such
units; and
Whereas, several downtown residential development projects need financial
assistance to secure funding for such project; and
Whereas, changes to the Downtown Rehabilitation Loan Program are necessary to
make the program more effective.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. The City Council approves the Request For Proposal for projects that
are in need of assistance to encourage new market -rate downtown rental and owner -
occupied residential housing units in the Greater Downtown Urban Renewal District.
Section 2. That the City Manager is hereby authorized and directed to distribute
the Request for Proposal to interested parties.
Section 3. That grants associated with projects utilizing the Downtown
Rehabilitation Loan Program may be funded once the project is completed, costs have
been verified, and funds are available within the loan /grant program.
Attest:
Passed, approved and adopted this 19 day of April, 2010.
eanne F. Schneider, City Clerk
F: \USERS \Econ Dev \Downtown Housing \RFP Resolutions\20100419 Resolution Downtown Housing RFP2.doc
Roy D. Buol, Mayor
DOWNTOWN HOUSING APPLICATION FOR PUBLIC ASSISTANCE
Name of Project:
Address of Project:
CONTACT INFORMATION
Name:
Address:
Company:
Telephone:
Fax:
E -mail:
Number of housing units created that are
greater than 500 Square Feet:
Amount of assistance needed: $
Structure of assistance:
❑ Loan
❑ Grant
❑ Other
Are there additional benefits to the city greater than the creation of new housing given
the structure of assistance?
Project Description:
(Please attach description as Attachment A)
Page 1 of 2
Estimated Start Date:
Estimated 25% Completion Date:
Estimated Completion Date:
Is the project located within the Greater Downtown Urban Yes ❑ No ❑
Renewal District?
Is the project rehabilitation of an existing structure? Yes El No ❑
Is a 10 year pro forma attached (as Attachment B)? Yes ❑ No ❑
Is a Floor plan for all units attached (as Attachment C)? Yes ❑ No ❑
Does the pro forma show a developer's fee? Yes ❑ No ❑
If yes, over what period of time will this fee be paid?
Does the project have bank financing? Yes ❑ No ❑
If yes, what financial institution?
Signature Date
A fully completed application with attachments and exhibits must be received in
the office of the City of Dubuque's Economic Development Department, 50 W. 13th
Street, Dubuque, Iowa 52001 by 12:00 p.m. CDT on Monday, May 24, 2010.
Page 2of2
F: \USERS\Econ Dev \Downtown Housing \RFP Application\20100412_Downtown Housing Application.doc
Greater Downtown Urban Renewal District
Version 2009.1
MT L 'RETTA
Attachment A
District Subareas
Cable Car Subarea
Ice Harbor Subarea A
Ice Harbor Subarea B
Ice Harbor Subarea C
Old Main Subarea
South Main Subarea
South Port Subarea
Town Clock Subarea
Upper Main Subarea
Warehouse Subarea