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Development Proposal for Stout Place - . . . IFA EXIDBIT 39 RESOLUI10N 184-00 WHEREAS, the City of Dubuque, Iowa, has been informed by MetroPlains Development, LLC that a low income hou&ing tax credit application (will or has been) filed with the Iowa F'Ulance Authority for the development of affordable rental hou&ing to be located at 125 W 9. Street, Dubuque, Iowa with a legal description as follows: City lot 168 lII1d 168A and the south 'h of city lot 167, City of Dubuque, Iowa WHEREAS, this housing project will contain approximate1y 31 units; WHEREAS, the units will be targeted to elderly and general occupancy; WHEREAS, the project will be a acquisition and rehabilitation; WHEREAS, the property will have the following amenities: On site laundry, conununity room, elevator and controlled entry, units will be full sized one and two bedroom apartments, kitchens will have full size ranges and refiigerators. WHEREAS, the developer has requested 10cal assistance through tax increment financing, a tax abatement, lead abatement loan, CDBG loan, city loan NOW, TIIEREFORE, BE IT RESOLVED by the City of Dubuque Governing Body, that we support and approve the development of the aforesaid housing in our community, subject to city ordinances and the building permit process. The resolution is effective until 4/20/2001. In the event that any of the characteristics mentioned above should change prior to the issuance of a building permit, this resolution is null and void. ADO.Pl'l:D BY THE GOVERNING BODY AND APPROVED BY THE MAYOR,this~dayof May ,200_ Terrance M. Duggan, Mayor Attest: Jeanne F. Schneider, City Clerk -- . CITY OF DUBUQUE, IOWA MEMORANDUM April 27, 2000 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Development Proposal for Iowa Inn . Housing Services Manager David Harris is recommending that MetroPlains Development replace the Iowa Housing Corporation as owner and developer of the Iowa Inn project. The Iowa Housing Corporation (IHC) is currently the owner of the Iowa Inn. The City of Dubuque provided a CDBG loan in May of 1997 to IHC for purchase of the property and is currently the first mortgage holder. The IHC, in February, voted to cease operations and has made an accepted offer to cede its assets to the State of Iowa. The Governor's Office is now examining IHC's corporate holdings and is expected to make a decision regarding disposition within the next 30-60 days. MetroPlains Development's plan for the Iowa Inn would differ from the Iowa Housing Corporation in that both buildings would be saved and rehabilitated, where the IHC had proposed tearing down the eastern building. MetroPlains Development would still only be creating 32 rental units, but they would be larger units than previous plans. However, they would not be creating the same number of on-site parking spaces, so they would require permits to use 31 spaces in the City parking lot across the street instead of 16 spaces in the previous plan. I concur with the recommendation and respectfully request Mayor and City Council approval. # Z IlLiell k~(J!ll Michael C. Van Milligen MCVM/dd Attachment VI 8JUC) ''J /10 cc: Barry Lindahl, Corporation Counsel Tim Moerman, Assistant City Manager David Harris, Housing Services Manager 9C :~ lid LZ (ldl1 00 . 03N::J.J38 I . CITY OF DUBUQUE, IOWA MEMORANDUM 25 April 00 To: Mike v~gen, City Manager From: David Harris, Housing Services Department Re: Development proposal for Stout Place Introduction The purpose of this memorandum is request the City Council to approve the request of MetroPlains Development to replace the Iowa Housing Corporation as owner and developer of the Iowa Inn/Stout Place project. . Background The Iowa Housing Corporation (IHC) is currently the owner of the Iowa Inn. The City of Dubuque provided a CDBG loan, in May 97, to IRC for purchase ofthe property and is currently the first mortgage holder. The Housing Corporation in February voted to cease operations and has made an accepted offer to cede its assets to the State ofIowa. The Governor's Office is now examining IHC's corporate holdings and is expected to make a decision regarding disposition within the next 30-60 days. Discussion Housing Department staffhas held discussions with other developers interested in this project. MetroPlains Development, a St Paul-based developer of housing tax credit properties, has worked with staff to formulate a proposal. MetroPlains has provided a packet of information on the structure ofthe company and a history of properties developed throughout the Midwest; this is attached to this memorandum. In particular, Metro's redevelopment ofthe Hotel Burlington - as its' initial Iowa project - has established a reputation locally for the corporation for quality work in the rehabilitation and restoration of historic structures. Their proposal is to do the same in Dubuque for the Iowa Inn. . Development Proposal While the Inn is again proposed to be developed in accordance with guidelines for the federal affordable housing tax credit program, it differs significantly in that Metro's concept is to rehabilitate both buildings on the site. The previous proposal called for demolition ofthe 1916 former YMCA building and restoration of the 1894 gymnasium building. The 32 units to be --- . . . included would have necessitated conversion of all common areas into apartments; as well, the unit sizes would have ranged from 480 to 640 square feet. Metro's proposal, utilizing both buildings - but adding no units - will result in restoration ofthe first floor common entry and lobby areas. As well, the apartments will range in size from 650 to 900 square feet, better reflecting trends in the current rental market. The rationale for this approach, in addition to respect for historic preservation, has to do with the availability of financing. Preservation of both structures will qualify the project for eligibility for federal historic tax credits, providing nearly $500 000 in additional investor equity. This in turn will decrease the housing tax credit allocation requested from the Iowa Finance Authority and increase the probability of favorable application decision. · Re-use of both buildings, however, will increase the parking needs for the project. Previously a concept agreement had been reached with the Council for approval of 16 parking permits, for building residents, to park in the City-owned surface lot on Iowa Street. The City was to have been fully reimbursed for lost meter revenue for these spaces, carried as a project cost of the development. The Metro proposal is for 31 permits, with the same cost reimbursement agreement. The deadline for submission ofthis year's application for tax credits, to the Finance Authority, is 15 July. As this schedule requires the developer to begin design and feasibility analysis quickly, MetroPlans is requesting an indication of the City of Dubuque's support of this partnership, at this time. Specifically, Metro is requesting the following: 1. The City approve the attached resolution ("IF A Exhibit 39"), signifYing the Council's endorsement of Metro Plains as the intended applicant, to the Iowa Finance Authority, for housing tax credits for the Iowa Inn project, as proposed. 2. Reiteration ofthe City's financial support, as previously committed to the Iowa Housing Corporation, as outlined in "IFA Exhibit 37: Local Contributing Effort Verification" (This support is actually less than previously committed; the "Tax Increment Financing" amount, of$220 000, was previously approved for the Housing Corporation in the amount of$300 000.) 3. The City "select MetroPIains as the preferred developer" of the project. (As the Iowa Housing Corporation is still the owner of the property, actual transfer of the deed, and the City's mortgage, cannot occur until the State's action to receive and transfer the Corporation's assets is completed.) ----- . . . Finally, MetroPlains is requesting the City, between this date and 1 July, to: 1. Work with the Governor's Office and the Finance Authority to facilitate transfer of ownership of the property. 2. Negotiate a mutually acceptable agreement regarding transfer of the City's CDBG first mortgage. 3. Negotiate a mutually acceptable agreement regarding the dedication ofIowa Street surface lot parking spaces Action Step The actions requested ofthe City Council are to: 1. Select MetroPlains as the preferred developer for rehabilitation of the Iowa Inn/Stout Place, according to the development concept as proposed; 2. Authorize the Mayor's execution ofIFA Exhibit 39, a resolution supporting the application of Metro Plains to the Iowa Finance Authority for housing tax credits; and 3. Authorize the City Manager's execution ofIFA Exhibit 37, re-committing financial assistance to MetroPlains Development for the proposed project, as previously approved for the Iowa Housing Corporation.