Paragon Square_Urban Renewal Tax Increment Revenue NotesMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Set Public Hearing on TIF Bond Sale for Paragon Square, LLC
DATE: July 23, 2011
Dubuque
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AA- AmedcaCity
111'
2007
The Archdiocese of Dubuque recently sold the former Holy Ghost School and Convent
to Pegasus Properties. Pegasus plans to rehabilitate the historic structures into
apartment buildings. For the projects to be financially feasible for the developer,
Pegasus requested the buildings be placed in an Urban Renewal District to allow for the
use of Tax Increment Financing to assist the project.
To accommodate the rehabilitation costs, the developer has requested the use of Tax
Increment Financing as an upfront grant. This grant will be funded by a bond which will
be repaid over 10 years by the incremental property taxes associated with this project.
This grant will be tied to the construction of 27 market rate residential units. The bond,
in an amount not to exceed $350,000, will provide sufficient revenue to give the
developer a $300,000 grant, and pay for administrative and interest costs for the first
two years, after which time the increase in property valuation will provide sufficient
property tax revenue to repay the bond. A Minimum Assessment Agreement will be
required to further assure sufficient property tax revenue to accommodate this bond
repayment.
Economic Development Director Dave Heiar recommends the City Council set a public
hearing for August 15, 2011, on the sale of Tax Increment Financing bonds up to
$350,000 to assist in the renovation of the former Holy Ghost School and Convent
buildings.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Mich el C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
2
Masterpiece on the Mississippi
TO: Michael C. Van Milligen, City Manager
FROM: David J. Heiar, Economic Development Director
SUBJECT: Set Public Hearing on TIF Bond Sale for Paragon Square, LLC
DATE: July 22, 2011
Dubuque
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1
2007
INTRODUCTION
The purpose of this memorandum is to request the City Council to set a public hearing
on the sale of TIF bonds to assist in the renovation of the former Holy Ghost School
and Convent buildings.
BACKGROUND
The Archdiocese of Dubuque recently sold the former Holy Ghost School and Convent
to Pegasus Properties. Pegasus plans to rehabilitate the historic structures into
apartment buildings. For the projects to be financially feasible for the developer,
Pegasus requested the buildings be placed in an Urban Renewal District to allow for the
use of Tax Increment Financing to assist the project.
On June 6, 2011, the City Council approved a Resolution of Necessity finding that the
proposed area was a blighted area and appropriate for urban renewal activities. Staff
has prepared an Urban Renewal Plan for the area as per the directive of the City
Council.
A consultation process was conducted with the affected taxing entities as required by
State Law. The required consultation with affected taxing bodies was held on June 21,
2011. No objections were received.
The Plan was reviewed by the Long Range Planning Commission on June 15, 2011.
The Long Range Planning Commission has forwarded its recommendation to the City
Council affirming that the Plan is consistent with the City's Comprehensive Plan for
development.
The Urban Renewal Plan created a district to include the former Holy Ghost School and
Convent buildings (see Attachment A). The plan would provide this area access to the
tools and incentives available to urban renewal district properties, including tax
increment financing.
1
DISCUSSION
The former Holy Ghost Assisi School building at 2901 Central was rezoned in January
to OR Office Residential. The Zoning Board of Adjustment approved a special
exception on February 24, 2011 to allow the building to be converted to 18 residential
units. The ZBA also approved a variance on December 16, 2010 to allow the former
convent building at 2887 Central to be converted to ten residential units.
2887 Central contains the former Holy Ghost convent building, a three story masonry
building which is currently vacant. The building will be rehabilitated into nine market
rate residential rental units with 11 off - street parking spaces. 2901 Central contains the
former Holy Ghost Assisi School building, a four -story masonry building, which is
currently vacant. The building will be converted to eighteen market rate residential
rental units with 23 off - street parking spaces. The total proposed capital investment for
these rehabilitation projects is estimated at $2,490,031.
The owners have applied to have both buildings listed on the National Register of
Historic Places and will apply for state and federal Historic Tax Credits. The buildings
will be renovated under the Secretary of Interior's standards for the renovation of
historic properties.
To accommodate the rehabilitation costs, the developer has requested the use of TIF
as an upfront grant. This grant will be funded by a bond which will be repaid over 10
years by the incremental property taxes associated with this project. This grant will be
tied to the construction of 27 market rate residential units. The bond, in an amount not
to exceed $350,000, will provide sufficient revenue to give the developer a $300,000
grant, and pay for administrative and interest costs for the first two years after which
time the increase in property valuation will provide sufficient property tax revenue to
repay the bond. A Minimum Assessment Agreement will be required to further assure
sufficient property tax revenue to accommodate this bond repayment.
RECOMMENDATION /ACTION STEP
I recommend that the attached proceeding prepared by Bond Counsel Bill Noth be
utilized to approve a resolution setting a public hearing on the proposed bond sale of up
to $350,000 to support the reinvestment efforts in this district.
attachments
F:\USERS\Econ Dev\Holy Ghost - 2905 Centra1\20110721 Holy Ghost set public hearing Council memo.docx
2
Holy Ghost
Urban Renewal District
Version 2011.1
AHLERS &COONEY, P.C.
100 COURT AVENUE, SUITE 600
DES MOINES, IOWA 50309 -2231
PHONE: 515 -243 -7611
FAX: 515- 243 -2149
WWW.AHLERSLAW.COM
William J. Noth
wnoth @ahlerslaw.com
July 22, 2011
Mr. Ken TeKippe
Finance Director
City of Dubuque
50 West 13th Street
Dubuque, Iowa 52001 -4864
RE: Urban Renewal Tax Increment Revenue Notes
(Paragon Square Project)
Dear Mr. TeKippe:
Direct Dial:
(515)246 -0332
We have now prepared and are enclosing herewith suggested proceedings to be
acted upon by the Council in fixing the date of a meeting on the proposition to issue
the above mentioned Notes and ordering publication of a notice of hearing consistent
with the provisions of Code Section 403.9.
Notice of this meeting must be published at least once in a legal newspaper,
printed wholly in the English language, published at least once weekly, and having
general circulation in the City. The date of publication is to be not less than four clear
days nor more than twenty days before the date of said public meeting on the issuance
of said Notes. In computing time, the date of publication should be excluded. If the
last day falls on Sunday, the whole of the following Monday should be excluded.
Also enclosed is an extra copy of the proceedings to be filled in as the original
and certified back to this office, together with publisher's affidavit of publication of
notice of hearing. We are also enclosing an extra copy of the notice of hearing to be
delivered to the newspaper for publication purposes. A certificate to attest the
proceedings is also enclosed.
July 22, 2011
Page 2
Should you have any questions pertaining to these proceedings, please don't
hesitate to contact me.
Very truly yours,
William J. Noth
WJN:dc
Encl.
cc: David Heiar (w /encl.)
00807543 -1 \10422 -127
AHLERS &COONEY, P.C.
100 COURT AVENUE, SUITE 600
DES MOINES. IOWA 50309 -2231
PHONE: 515 -243 -7611
FAX: 515 -243 -2149
WWW.AHLERSLAW.COM
William J. Noth
wnoth @ahlerslaw.com
July 22, 2011
Mr. Ken TeKippe
Finance Director
City of Dubuque
50 West 13th Street
Dubuque, Iowa 52001 -4864
RE: Urban Renewal Tax Increment Revenue Notes
(Paragon Square Project)
Dear Mr. TeKippe:
Direct Dial:
(515)246 -0332
We have now prepared and are enclosing herewith suggested proceedings to be
acted upon by the Council in fixing the date of a meeting on the proposition to issue
the above mentioned Notes and ordering publication of a notice of hearing consistent
with the provisions of Code Section 4(3.9.
Notice of this meeting must be I ublished at least once in a legal newspaper,
printed wholly in the English language published at least once weekly, and having
general circulation in the City. The dat of publication is to be not less than four clear
days nor more than twenty days before the date of said public meeting on the issuance
of said Notes. In computing time, the c ate of publication should be excluded. If the
last day falls on Sunday, the whole of tl e following Monday should be excluded.
Also enclosed is an extra copy of the proceedings to be filled in as the original
and certified back to this office, together with publisher's affidavit of publication of
notice of hearing. We are also enclosing . an extra copy of the notice of hearing to be
delivered to the newspaper for publicatic n purposes. A certificate to attest the
proceedings is also enclosed.
July 22, 2011
Page 2
Should you have any questions pertaining to these proceedings, please don't
hesitate to contact me.
Very truly yours,
William J. Noth
WJN:dc
Encl.
cc: David Heiar (w /encl.)
00807543 -1 \10422 -127
NOTICE OF MEETING
OF THE COUNCIL OF
THE CITY OF
DUBUQUE, IOWA, ON
THE MATTER OF THE
PROPOSED ISSUANCE
OF NOT TO EXCEED
$350,000 URBAN
RENEWAL TAX
INCREMENT
REVENUE NOTES OF
SAID CITY, AND THE
HEARING ON THE
ISSUANCE THEREOF
PUBLIC NOTICE is
hereby given that the
Council of the City of
Dubuque, Iowa, will
hold a public hearing
on the 15th day of
August 2011, at 6:30
o'clock P.M., in the
Historic Federal
Building, 350 West 6th
Street, Dubuque, Iowa,
at which meeting the
Council proposes to
take additional action
for the issuance of not
to exceed $350,000
Urban Renewal Tax'
Increment Revenue
Notes in order to
provide funds to pays
costs of aiding in the .
planning, undertaking'
and carrying out of
urban renewal project
activities under the
authority of Chapter
403 of the Code of Iowa
and the Urban Renewal
Plan for the Holy Ghost
Urban Renewal District,
including those costs
associated with the
funding of economic
development grants to
Paragon Square, LLC,
an Illinois limited
liability company,
under the terms of a
Development Agree-
ment between the City
of Dubuque and
Paragon Square, LLC,
as the same may be
amended from time to
time, and the funding
of related reserves and
payment of capitalized
interest and the costs
of issuance of the
Atthe above meeting
the Council shall
receive oral or written
objections from any
resident or property
owner of said City to
the above action. After
all objections have
been received and
considered, the Council
will at this meeting or
at any adjournment
thereof, take additional
action for the issuance
of said Urban Renewal
Tax Increment Reve-
nue Notes or will
abandon. the proposal
to issue said obliga-
tions. Said hearing and
appeals there from
shall be held in
,'accordance with and
governed by the
provisions of Section
', 403.9 of the Code of
Iowa; .
This notice is given by
order bf the Council of
Dd'buque, Iowa, as
provided - by Section
403.9 of the Code of
Iowa.
'Dated this 5th day of
August, 2011.
Kevin S. Firnstahl
Acting City Clerk of
• Dubuque, Iowa
Notes, 1tys
STATE OF IOWA {SS:
DUBUQUE COUNTY
CERTIFICATION OF PUBLICATION
I, Suzanne Pike, a Billing Clerk for Woodward Communications, Inc., an Iowa
corporation, publisher of the Telegraph Herald,a newspaper of general circulation
published in the City of Dubuque, County of Dubuque and State of Iowa; hereby
certify that the attached notice was published in said newspaper on the following
dates: August 05, 2011, and for which the charge is $28.43.
Subscribed to before me,
this 0 day of
Notary Public in and for Dubuque County, Iowa,
,20 tt .
ary Public in and for Dubuque County, Iowa.
JANET K. PAPE
Commission Number 199659
My Comm. Exp. DEC 11, 2013
City Clerk, Dub que, Iowa (Actin
Governmental Body: The City Council of Dubuque, Iowa.
Date of Meeting: August 15 , 2011.
Time of Meeting: 6:30 o'clock P .M.
Place of Meeting: Historic Federal Building, 350 West 6th Street, Dubuque,
Iowa.
Not to exceed $350,000 Urban Renewal Tax Increment Revenue Notes.
Resolution fixing date for a meeting on the proposition to issue.
1
� d� O G II N/L
(This Notice to be posted)
NOTICE AND CALL OF PUBLIC MEETING
PUBLIC NOTICE IS HEREBY GIVEN that the above mentioned governmental
body will meet at the date, time and place above set out. The tentative agenda for said
meeting is as follows:
Such additional matters as are set forth on the additional 5 page(s) attached
hereto. (number)
This notice is given at the direction of the Mayor pursuant to Chapter 21, Code of
Iowa, and the local rules of said governmental body.
STATE OF IOWA
COUNTY OF DUBUQUE
CERTIFICATE
) SS
CIG -3
9/91
I, the undersigned City Clerk of Dubuque, Iowa, do hereby certify that attached is
a true and complete copy of the portion of the corporate records of said Municipality
showing proceedings of the Council, and the same is a true and complete copy of the
action taken by said Council with respect to said matter at the meeting held on the date
indicated in the attachment, which proceedings remain in full force and effect, and have
not been amended or rescinded in any way; that meeting and all action thereat was duly
and publicly held in accordance w ith a notice of meeting and tentative agenda, a copy of
which was timely served on each member of the Council and posted on a bulletin board
or other prominent place easily accessible to the public and clearly designated for that
purpose at the principal office of the Council (a copy of the face sheet of said agenda
being. attached hereto) pursuant to the local rules of the Council and the provisions of
Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at
least twenty -four hours prior to the commencement of the meeting as required by said
law and with members of the public present in attendance; I further certify that the
individuals named therein were on the date thereof duly and lawfully possessed of their
respective city offices as indicated therein, that no Council vacancy existed except as may
be stated in said proceedings, and that no controversy or litigation is pending, prayed or
threatened involving the incorporation, organization, existence or boundaries of the City
or the right of the individuals named therein as officers to their respective positions.
WITNESS my hand and the seal of said Municipality hereto affixed this 2nd
day of August , 2011.
SEAL
00807545 -1 \10422 -127
7
August 1 ,2011
The City Council of Dubuque, Iowa, met in regular session, in the Historic
Federal Building, 350 West 6th Street, Dubuque, Iowa, at 6:30 o'clock P .M., on the
above date. There were present Mayor Roy D. B u o 1 , .in the chair, and
the following named Council Members:
Absent:
Karla Braig, Joyce Connors, Ric Jones
Kevin Lynch, David Resnick, Lynn Sutton
2
Council Member Lynch introduced the following Resolution
entitled "RESOLUTION FIXING DATE FOR A MEETING ON THE PROPOSITION
OF THE ISSUANCE OF NOT TO EXCEED $350,000 URBAN RENEWAL TAX
INCREMENT REVENUE NOTES OF DUBUQUE, IOWA, AND PROVIDING FOR
PUBLICATION OF NOTICE THEREOF ", and moved that the same be adopted.
Council Member Connors seconded the motion to adopt. The roll was
called and the vote was,
AYES:
NAYS:
Jones, Lyncy, Resnick, Sutton
Braig, Buol, Connors
Whereupon, the Mayor declared the resolution duly adopted as follows:
RESOLUTION NO. 245 -11
RESOLUTION FIXING DATE FOR A MEETING ON THE
PROPOSITION OF THE ISSUANCE OF NOT TO EXCEED $350,000
URBAN RENEWAL TAX INCREMENT REVENUE NOTES OF
DUBUQUE, IOWA, AND PROVIDING FOR PUBLICATION OF
NOTICE THEREOF
WHEREAS, it is deemed necessary and advisable that the City of Dubuque, Iowa
should issue Urban Renewal Tax Increment Revenue Notes to the amount of not to
exceed $350,000, as authorized by Section 403.9 of the Code of Iowa, for the purpose of
providing funds to pay costs of carrying out a project as hereinafter described; and
WHEREAS, Section 403.9 sets forth the procedural action required to be taken
before said Urban Renewal Tax Increment Revenue Notes may be issued, and it is
therefore necessary that the action hereinafter described be taken and that the Clerk
publish a notice of the proposal and of the time and place of the meeting at which the
Council proposes to take action thereon and to receive oral and /or written objections from
any resident or property owner of said City to such action.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF DUBUQUE, IOWA:
3
Section 1. That this Council meet in the Historic Federal Building, 350 West 6th
Street, Dubuque, Iowa, at 6:30 o'clock P .M., on the 15th day of
August , 2011, for the purpose of taking action on the matter of the issuance
of not to exceed $350,000 Urban Renewal Tax Increment Revenue Notes, the proceeds of
which will be used to provide funds to pay costs of aiding in the planning, undertaking
and carrying out of urban renewal project activities under the authority of Chapter 403 of
the Code of Iowa and the Urban Renewal Plan for the Holy Ghost Urban Renewal
District, including those costs associated with the funding of economic development
grants to Paragon Square, LLC, an Illinois limited liability company, under the terms of a
Development Agreement between the City of Dubuque and Paragon Square, LLC, as the
same may be amended from time to time, and the funding of related reserves and
payment of capitalized interest and the costs of issuance of the Notes.
Section 2. That the Clerk is hereby directed to cause at least one publication to be
made of a notice of said meeting, in a legal newspaper, printed wholly in the English
language, published at least once weekly, and having general circulation in said City, said
publication to be not less than four clear days nor more than twenty days before the date
of said public meeting on the issuance of said obligations.
Section 3. The notice of the proposed action to issue said Urban Renewal Tax
Increment Revenue Notes shall be in substantially the following form:
4
NOTICE OF MEETING OF THE COUNCIL OF THE CITY OF
DUBUQUE, IOWA, ON THE MATTER OF THE PROPOSED
ISSUANCE OF NOT TO EXCEED $350,000 URBAN RENEWAL TAX
INCREMENT REVENUE NOTES OF SAID CITY, AND THE
HEARING ON THE ISSUANCE THEREOF
PUBLIC NOTICE is hereby given that the Council of the City of Dubuque, Iowa,
will hold a public hearing on the day of , 2011, at o'clock
.M., in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at which
meeting the Council proposes to take additional action for the issuance of not to exceed
$350,000 Urban Renewal Tax Increment Revenue Notes in order to provide funds to pay
costs of aiding in the planning, undertaking and carrying out of urban renewal project
activities under the authority of Chapter 403 of the Code of Iowa and the Urban Renewal
Plan for the Holy Ghost Urban Renewal District, including those costs associated with
the funding of economic development grants to Paragon Square, LLC, an Illinois limited
liability company, under the terms of a Development Agreement between the City of
Dubuque and Paragon Square, LLC, as the same may be amended from time to time, and
the funding of related reserves and payment of capitalized interest and the costs of
issuance of the Notes.
At the above meeting the Council shall receive oral or written objections from any
resident or property owner of said City to the above action. After all objections have
been received and considered, the Council will at this meeting or at any adjournment
thereof, take additional action for the issuance of said Urban Renewal Tax Increment
Revenue Notes or will abandon the proposal to issue said obligations. Said hearing and
appeals therefrom shall be held in accordance with and governed by the provisions of
Section 403.9 of the Code of Iowa.
This notice is given by order of the Council of Dubuque, Iowa, as provided by
Section 403.9 of the Code of Iowa.
Dated this
day of , 2011.
City Clerk of Dubuque, Iowa
(End of Notice)
5
ATTEST:
PASSED AND APPROVED this 1st day of
August , 2011.
6