HHH Enterprises LLC Downtown Housing Incentive AwardsMasterpiece on the Mississippi
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2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Additional Recommendation for Second Round of Downtown Housing
Incentive Awards
DATE: August 10, 2010
Economic Development Director Dave Heiar is recommending $15,000 in funding to
HHH Enterprises, LLC to create three housing units at 164 -180 Main Street. This will
be the eighth project receiving funding.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
1 -4 /1-___ - ___
aelC.V
Van a Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
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
Masterpiece on the Mississippi
TO: Michael Van Milligen, City Manager
FROM: David J. Heiar, Economic Development Director l 61
SUBJECT: Additional Recommendation for Second Round of Downtown Housing
Incentive Awards
DATE: August 5, 2010
INTRODUCTION
This memo is to provide a recommendation from the second round of funding to
encourage new residential housing units in downtown Dubuque.
Dubuque
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2007
BACKGROUND
On November 19, 2009, the City Council 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. The City Council approved
some revisions to the program and announced a second round of funding.
The deadline for submitting applications for the second round was May 24, 2010 and 9
applications were received requesting over $3.2 million in incentives. A selection
committee has reviewed the applications. The committee included:
299 Main Street
73 CHS Forwards, LLC
(Cooper Wagon Works Bldg.)
21
$210,000
Grant
426 -428 W. 5 St.
4
$110,000
The Fischer Companies
Grant
951 -965 Main St.
7
• Dave Heiar, Economic Development Director
• Rick Dickinson, Greater Dubuque Development
• Barry Lindahl, City Attorney
• Guy Hemenway, Assistant Planner
• Steve Brown, Engineering Project Manager
• Aaron DeJong, Asst. Economic Development Director
Proposals were evaluated on several criteria. The criteria included:
• Timeliness /Readiness
• Cost/Benefit
• Impact
• Additional benefits of proposed project (i.e. exterior rehab, historic preservation,
LEED, Commercial Development)
• Magnitude of other City financial assistance being requested
In July 2010, the City Council approved incentives for three more projects as listed
below:
Address
After funding the approved projects, $1,974,000 is still available in the incentive
• program to encourage new housing units in the urban renewal district.
DISCUSSION
The committee is recommending the following projects be approved to receive certain
incentives to create new housing units within the Greater Downtown Urban Renewal
District:
Address
Developer
Developer
Housing
Units
Housing
Units
Assistance
Assistance
164 -180
Main Street
HHH Enterprises, LLC
3
$15,000
Grant
The committee is still doing due diligence and negotiating with some of the other
developers /applicants to determine if they can meet the timeframes and merit a
commitment of city assistance.
RECOMMENDATION
The recommendation is to approve the attached resolution authorizing staff to negotiate
a contract for award to the above project and allow the City Manager to execute an
agreement with the property owner to commit to the market rate housing unit creations.
A sample of the proposed agreement format is attached.
F: \USERS\Econ Dev \Downtown Housing \RFP 2nd Round Memos\20100806 Housing RFP #2 Additional_Recommendation 2.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 13th Street, Dubuque IA 52001 563 589 -4121
RESOLUTION NO. 313 -10
APPROVING AN AWARD TO HHH ENTERPRISES, LLC FROM THE DOWNTOWN
HOUSING INCENTIVE POOL TO CREATE NEW MARKET -RATE HOUSING UNITS
WITHIN THE GREATER DOWNTOWN URBAN RENEWAL DISTRICT
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, the City received several applications for assistance from a Request for
Proposals due May 24, 2010; and
Whereas, such proposals have been reviewed by a recommendation committee.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. The City Council approves the following project to receive financial
assistance for the creation of market -rate housing units within the Greater Downtown
Urban Renewal District:
164 -180 Main Street
HHH Enterprises, LLC
3
$15,000
Grant
Section 2. That the City Manager is hereby authorized and directed to execute an
Incentive Agreement with HHH Enterprises, LLC.
Atte
Address
Developer
Passed, approved and adopted this 16 day of August, 2010.
Jeanne F. Schneider, City Clerk
Housing
Units
Assistance
oy D. Buol, Mayor
F: \USERS \Econ Dev \Downtown Housing \RFP Resolutions\20100806 Resolution Housing Award Rnd 2 #2 Additional.doc
A
DOWNTOWN HOUSING PROGRAM
INCENTIVE AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
HHH ENTERPRISES, LLC
This Agreement, dated for reference purposes the day of , 2010,
is made and entered into by and between the City of Dubuque, Iowa (City), a municipal
corporation organized and existing under the laws of the State of Iowa and HHH Enterprises,
LLC (Owner).
Whereas, the Owner's property at 164 -180 Main Street (the Building) is located within
the boundaries of the Greater Downtown Urban Renewal District (the District); and
Whereas, the goals and objectives of the Greater Downtown Urban Renewal Plan
(the Plan) provide for the creation of the financial incentives creating housing opportunities
within the District; and
Whereas, City desires to assist Owner in its efforts to create housing opportunities
within the District through the Downtown Housing Incentive Program (the Incentive
Program).
NOW THEREFORE, in consideration of the premises and respective covenants,
agreements and representations hereinafter set forth, the parties agree as follows:
SECTION 1. HOUSING UNIT CREATION. The Owner commits to creating new market -
rate rental units by July 1, 2011 as described in Section 19(2) (the Project) within the
Building.
SECTION 2. SOURCE OF FUNDS. City has allocated funds sufficient to carry out its
obligations under this Agreement.
SECTION 3. HOUSING GRANT.
3.1 City agrees to provide to Owner on the terms and conditions set forth herein a grant
the amount of Fifteen Thousand Dollars ($15,000.00) (the Grant) that shall consist of
Incentive Program funds.
3.2 Grant funds shall be disbursed to Owner by City for Qualifying Project Expenses,
defined in Section 19(3), for amounts not in excess of the total sum in Section 3.1. It is
expressly understood that all funds advanced under this Agreement shall be used by Owner
only for the purpose of paying the Qualifying Project Expenses set forth in such written
requests.
F:\USERS\Econ Dev \180 Main\Downtown Housing Incentive\HHH Enterprises 180 Main Downtown Housing Incentive Agreement.doc
3.3 Grant funds will be disbursed to the Owner after City issuance of a Certificate of
Occupancy for the Project. Prior to the disbursement of any funds, Owner shall provide
evidence satisfactory to City that the improvements have been completed in accordance
with the plans and other documentation submitted to City with the application.
SECTION 4. FINANCIAL CONDITION OF OWNER. Owner has delivered to City
evidence of Owner's ability to complete the Project as of the date of application for financial
assistance which fairly represents the financial condition of Owner as of the date stated, all
in accordance with generally accepted accounting principles consistently applied, and that
the statements still correctly reflect the financial condition and status of its operations as of
the date of this Agreement.
SECTION 5. TITLE OF OWNER. Subject to the liabilities reflected on Owner's financial
statement as well as those incurred in relation to this Project, Owner represents that it has
good and marketable title, free and clear of any mortgage, pledge, lien, security interest,
encumbrance, or charge to all those assets reflected on the financial statement and to
assets since acquired. Taxes not due or payable or otherwise delinquent are excepted.
SECTION 6. HISTORIC CHARACTER. All exterior work shall coincide with the historic
character of the building.
SECTION 7. DEFAULT. Owner shall be in default upon the occurrence of any of the
following events:
(1) Owner becomes insolvent or admits in writing its inability to pay its debts as
they mature; or applies for, consents to or acquiesces in the appointment of a trustee
or receiver for any of its property; or in the absence of an application for consent or
acquiescence, a trustee or receiver is appointed for it or a substantial part of its
property and is not discharged within ten (10) days; or it otherwise commits an act of
bankruptcy; or any bankruptcy, reorganization, debt arrangement or other proceeding
under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding
is instituted by or against it and if instituted is consented to or acquiesced in by it or
remains for ten days undismissed;
(2) Owner fails in the performance of any of the terms and conditions of this
Agreement and such non - performance continues for ten (10) days after written notice
thereof from City or from the holder of a note;
(3) Any warranty made by Owner is untrue in any material respect, or any
schedule, statement, report, notice or writing furnished by Owner to City is untrue in
any material respect on the date as of which the facts set forth are stated or certified,
provided any such error is not the result of unintentional errors which are capable of
correction without prejudice to the City;
(4) Any government board, agency, department, commission or public or private
lender takes possession or control of any substantial part of any property of Owner.
2
SECTION 8. ADDRESS. Owner's principal business address is:
Owner shall promptly give City written notice of any further change in its principal
office address.
City's address is:
Heath or Sara Hutchinson
HHH Enterprises, LLC
221 Bradley Street
Dubuque, Iowa 52003
City Manager
City Hall
50 West 13th Street
Dubuque, Iowa 52001
SECTION 9. LIMITATION OF CITY'S LIABILITY FOR PROJECT ACTIVITIES. City shall
not be liable to Owner, or to any party, for the completion of, or the failure to complete, any
activities which are part of the Project, except as may be specifically provided in this
Agreement or other written agreements between City and Owner or any of Owner's affiliates
or subsidiaries. Owner agrees to indemnify, hold harmless and defend City from any such
claims.
SECTION 10. CONFLICT OF INTEREST. Owner certifies that to its knowledge no
member, officer or employee of City, or its designees or agents, nor any consultant or
member of the governing body of City, and no other public official of City who exercises or
has exercised any functions or responsibilities with respect to the Project during his or her
tenure, or who is in a position to participate in a decision making process or gain inside
information with regard to the Project, has nor shall have any interest, direct or indirect, in
any contract or subcontract, or in any activity, or benefit therefrom, which is part of this
Project at any time during or for one year after such person's tenure.
SECTION 11. NONDISCRIMINATION. In carrying out the Project, Owner shall not
discriminate against any employee or applicant for employment or tenancy because of race,
religion, color, sex, sexual orientation, national origin, age or disability. Owner shall post in a
conspicuous place, available to employees and applicants for employment, notices to be
provided by City setting forth the provisions of this nondiscrimination clause. Owner shall
state that all qualified applicants will receive consideration for employment without regard to
race, religion, color, sex, sexual orientation, national origin, age or disability.
SECTION 12. DISCLAIMER OF RELATIONSHIPS. Nothing contained in this Agreement
between the parties, nor any act of City or Owner, shall be deemed or construed by any of
the parties, or by any third persons, to create any relationship of third party beneficiary,
principal or agent, limited or general partnership, or joint venture.
3
SECTION 13. NOTICE. Any notice, if mailed by United States certified mail, shall be
deemed given when mailed, postage prepaid, addressed to the other party at its address
shown above, or at any other address subsequently designated by either party to the other.
SECTION 14. SUCCESSORS AND ASSIGNS. All covenants, representations, warranties
and agreements herein set forth shall be binding upon Owner, and its legal representatives,
successors and assigns. This Agreement may not be assigned by City or Owner, without
the express written consent of the other party.
SECTION 15. LEGALITY. If any provision of this Agreement shall, for any reason, be
held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any
other provision hereof, but this Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein.
SECTION 16. GOVERNING LAW. This Agreement and all rights and duties hereunder,
including but not limited to all matters of construction, validity and performance shall be
governed by the laws of the State of Iowa.
SECTION 17. SURVIVAL OF REPRESENTATIONS. All representations or warranties of
Owner shall survive the execution and delivery of this Agreement and any note executed
and delivered under it, and no investigation by City, nor any closing shall affect the
representations or warranties or the right of City to rely on and enforce them.
SECTION 18. DELAY. No delay on the part of City or the holder of any note in the
exercise of any right shall operate as a waiver, nor shall any single or partial exercise of any
right preclude other or additional exercise of any right.
SECTION 19. DEFINITIONS.
(1) "Closing Date" shall mean the date on which this Agreement is executed by
the parties.
(2) "Project" shall mean the rehabilitation project of Owner's property at 164 -180
Main Street, identified in Owner's application for financial assistance. Said application
is on file in the office of the Economic Development Department, 50 West 13th
Street, Dubuque, Iowa 52001. The Project shall include the creation of Three (3) new
market rate residential housing units at a cost of not less than $155,000. The
housing units shall be completed by July 1, 2011.
(3) "Qualifying Project Expenses" shall mean those expenditures or expenses
incurred by Owner during and for the Project and identified in the Owner's application
for financial assistance, whether paid to third parties or incurred as wage expense,
fringe benefit expense or other costs of Owner's employees, agents and contractors.
(4) "New rental housing unit" shall mean either a rental housing unit created
where one did not previously exist, or an existing rental housing unit which has been
4
unlicensed and unoccupied for a period of not less than five years prior to the date
of this Agreement.
SECTION 20. CERTIFICATION OF COMPLIANCE WITH CITY CODES. By signing this
Agreement, Owner certifies that all property in the City of Dubuque owned by Owner or in
which Owner has any interest, other than the Project property, complies with all applicable
City of Dubuque ordinances and regulations, including, but not limited to, housing, building,
zoning, fire, health, and vacant and abandoned building regulations.
CITY OF DUBUQUE, IOWA HHH ENTERPRISES, LLC
Michael C. Van Milligen, City Manager Heath H. Hutchinson
5
Sara Hutchinson