Gronen Prop Afford Hsg Tax CredMEMORANDUM
TO:
FROM:
SUBJECT:
December 19, 2003
The Honorable Mayor and City Council Members
Michael C. Van Milligen, City Manager
Affordable Housing Tax Credit Program Application from Gronen
Properties
The Affordable Housing Tax Credit Program provides an equity financing mechanism
for housing projects, which in turn provide rental housing for Iow- and moderate-income
tenants. It implements Section 42 of the Intemal Revenue Service Code, returning tax
credits to investors who build or renovate Iow income housing.
Housing and Community Development Department Director David Harris recommends
City Council approval of an application from Gronen Properties for tax credits for a 30-
unit project located in four buildings in the Upper Main area. The majority of these units
have remained vacant for ten or more years. In addition, the planned historic
rehabilitation will restore 13 storefronts on the street level of these buildings. The total
project cost is projected at approximately $5 million.
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
David Harris, Housing and Community Development Department Director
MEMORANDUM
15 December 03
To: Mike V~, r~\Milligen, City Manager
From: David Fl~s, Housing and Community Development Department
Re: Affordable Housing Tax Credit Program Application from Gronen Properties
Introduction
The purpose of this memorandum is to respond to a notification from the Iowa Finance
Authority (IFA) for comment regarding a project proposed to be financed in part through
the Authority's Affordable Housing Tax Credit Program.
Background
The Affordable Housing Tax Credit Program provides an equity financing mechanism
for housing projects which in turn provide rental housing for Iow- and moderate-income
tenants. It implements Section 42 of the Internal Revenue Service code, returning tax
credits to investors who build or renovate Iow income housing. In Iowa it is administered
by the Iowa Finance Authority, which annually distributes approximately $5 miilien in tax
credits, on a competitive application basis.
In Dubuque, projects previously financed through this program include Mercy
Housing's Loras Boulevard and Main Street apartments, the Applewood complex
on Pennsylvania Avenue, the Bishop's Block Apartments, the Iowa Inn/Henry
Stout Place and the Arbor Glen apartments now renting on Raven Oaks Drive.
Additionally, Area Residential Cafe's new facility, to be located on Kennedy Circle,
was approved by IFA last year and is expected to commence construction in the
coming months.
Discussion
In the current funding cycle, Gronen Properties has made application for tax credits, for
a 30-unit project located in four buildings in the Upper Main area. The majority of these
units have remained vacant for ten or more years. In addition, the planned historic
rehabilitation will restore 13 storefronts on the street level of these buildings. Total
project cost is projected at approximately $5 million.
Action Step
The action requested of the City Council is to authorize the Mayor's execution of the
attached resolution, supporting the application for equity financing assistance for the
Gronen Upper Main Revitalization Project.
RESOLUTION NO, 6-04
RESOLUTION AUTHORIZING THE CITY COUNCIL TO ENDORSE THE
GRONEN PROPERTIES' APPLICATION FOR FEDERAL ASSISTANCE
FOR A RENTAL HOUSING REHABILITATION PROJECT ON UPPER
MAIN STREET
Whereas, the federal govemment, through Section 42 of the Internal Revenue
Code, offer incentives for rehabilitation of affordable rental housing which is made
available to Iow- and moderate-income households; and
Whereas, Gronen Properties has submitted an application for affordable housing
tax credits in connection with a proposed project to rehabilitate 30 rental units, located
at 1042, 1066, 1069,1086 and 1091 Main Street; and at 248 West 11TM Street in the
City of Dubuaue; and ~
Whereas, indication of City support for the requested federal assistance is
favorable to the Iowa Finance Authodty~s consideration of the application.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
DUBUQUE, IOW~
Section 1. The City of Dubuque endorses and supports the application from
Gronen Properties for tax credits to the Iowa Finance Authority, for the intended project
located on Main Street.
Section 2. The City Manager is hereby authorized and directed to forward this
resolution to the Finance Authority.
Passed, approved and adopted this 5th day of January, 2004.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, City Clerk
5th
day of January, 2004.
T~rranca M Duggan~yor
Iowa Finance Authority
December 10, 2003
Honorable Terry Duggan
Mayor, City of Dubuque
City Hall - 50 W. 13th St.
Dubuque, IA 520014869
Thomas J. Vi~sacK
Sally J Pedersoq
Michael L. Tramontina
Honorable Terry Duggan
Section 42(m)(1)(A)(ii) of the Internal Revenue Code of 1986, as amended, requires that the Iowa
Finance Authority notify the chief executive officer (or the equivalent) of the local jurisdiction
when an Affordable Homing Tax Credit application has been submitted for a project in that local
jurisdiction and to provide reasonable opportunity for comment of the project. This letter serves
as notification to you that the following application has been filed with the Iowa Finance
Authority under the Affordable Housing Tax Credit Program. Comments are not required by the
local jurisdiction, this is merely a required notice to the jurisdiction. Any comments must be
submitted in writing to the address shown below. Include the Project Number on any
correspondence.
Project Number: 04-01
Project Name: Upper Main Revitalization Project
Project City: Dubuque
Comments concerning these projects should be addressed to:
Low-Income Housing Tax Credit Program
Iowa Finance Authority
100 E. Grand Avenue, Suite 250
Des Moines, IA 50309
The Authority should receive any comments concerning these projects by 4:30 p.m., December
,,~2, 2003 for consideration prior to any action taken by the Authority on those projects that ranked
high enough in the review process to receive a reservation of Low-income Housing Tax Credit.
If you have any questions, please feel free to contact our office.
Tim Waddell
BOARD MEMBERS
Roger Caudron
109 East 6rand Avenue
Suite 250
Des Moines, Iowa 56309
MAIN OFFICE
515.Z42.A99D
800.432.7230
515.2424957
SECTION 8 OFFICE
515.242.0Z59
877.428.0634
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TT¥
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