Housing Enterprise Zone Prog Agree Washington Ct Project
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MEMORANDUM
August 29, 2005
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Housing Enterprise Zone Program Agreement #05-HEZ-053 for the
Washington Court Project
Economic Development Director Dave Heiar recommends City Council approval of a
Housing Enterprise Zone Program Agreement for Community Housing Initiatives for the
Washington Court Project, which will provide 36 new housing units in an historic
building in the Washington Street neighborhood.
The City has authorized a $200,000 CDBG loan to this project and the project will also
qualify for Urban Revitalization tax abatement. There is no additional commitment
within the agreement of any further City assistance.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Mic ael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
David Heiar, Economic Development Director
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CITY OF DUBUQUE, IOWA
MEMORANDUM
August 19, 2005
TO: Michael Van Milligen, City Manager
FROM: David Heiar, Economic Development Director~\
SUBJECT: Housing Enterprise Zone Program Agreement #05-HEZ-053 for the
Washington Court Project
INTRODUCTION
This memorandum presents for City Council approval a Housing Enterprise Zone Program
Agreement by and among the Iowa Department of Economic Development (IDED), the City
and Community Housing Initiatives for the Washington Court project. The City Council is
requested to adopt a resolution approving the agreement.
BACKGROUND
On June 27, 2005, the City Enterprise Zone Commission approved an application to IDED
on behalf of Community Housing Initiatives for Housing Enterprise Zone benefits related to
the redevelopment of the 1700 block of Washington Street, the former Dubuque Casket
Company building. Local developer John Gronen is a partner in this project. IDED
approved the application on July 9,2005.
DISCUSSION
Attached to this memorandum is a resolution that provides for the approval of the agreement
(also attached) for Housing Enterprise Zone benefits for the project. The resolution
authorizes and directs the Mayor to execute the agreement on behalf of the City. The
agreement outlines the State benefits that will accrue to the housing developer.
The project will provide 36 new housing units in a historic building in the Washington Street
neighborhood and have an estimated capital investment of $5,368,870 in Enterprise Zone 2.
The City has authorized a $200,000 CDBG loan to this project and it will also qualify for
Urban Revitalization tax abatement.
RECOMMENDATION
I recommend that the City Council approve the attached Housing Enterprise Zone Program
Agreement for Community Housing Initiatives for the Washington Court project by adopting
the attached resolution. There is no additional commitment within the agreement of any
further City assistance,
ACTION STEP
The action step for the Council is to adopt the attached resolution.
attachments
F:\USERSIPmyhre\WPDOCS\EZ\Gro nen\CONTRACT,MEM,doc
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RESOLUTION NO. 405-05
RESOLUTION APPROVING A HOUSING ENTERPRISE ZONE PROGRAM
AGREEMENT BY AND AMONG THE IOWA DEPARTMENT OF ECONOMIC
DEVELOPMENT, THE CITY OF DUBUQUE AND COMMUNITY HOUSING INITIATIVES
FOR THE WASHINGTON COURT PROJECT.
Whereas, the City of Dubuque has established two Enterprise Zones and an
Enterprise Zone Commission; and
Whereas, the Enterprise Zone Commission on June 27, 2005 approved the
application of Community Housing Initiatives for Housing Enterprise Zone benefits for the
Washington Court project; and
Whereas, Community Housing Initiatives' application for the Washington Court
project was approved by the Iowa Department of Economic Development on July 9,2005;
and
Whereas, the Iowa Department of Economic Development has prepared and
submitted for City Council approval an agreement relating to Housing Enterprise Zone
benefits for Community Housing Initiatives (Washington Court) a copy of which is attached
hereto and by this reference made a part hereof; and
Whereas, the City Council finds that the proposed agreement is acceptable and
necessary to the growth and development of the city.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the Iowa Department of Economic Development Housing
Enterprise Zone Program Agreement, #05-HEZ-053, is hereby
approved.
Section 2. That the Mayor is hereby authorized and directed to execute the
Agreement on behalf of the City of Dubuque and forward the
executed copy to the Iowa Department of Economic Development for
their approval.
Passed, approved and adopted this 6th day of September 2005.
Terrance M. Duggan, Mayor
Attest:
Jeanne F. Schneider, City Clerk
F:\USERS\Pmyhre\WPDOCS\EZ\WASHINGTON COURT\CONTRACT.res.doc
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IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
HOUSING ENTERPRISE ZONE PROGRAM AGREEMENT
EZ AGREEMENT NUMBER:
APPLICATION APPROVAL DATE:
05-HEZ-053
July 9, 2005
July 9, 2005
AGREEMENT EFFECTIVE DATE:
ENTERPRISE ZONE NAME:
ZONE CERTIFICATION DATE:
ZONE EXPIRATION DATE:
Dubuque County, Dubuque EZ-2
December 16, 2004
December 16, 2014
THIS ENTERPRISE ZONE AGREEMENT is made by and among the Iowa Department of Economic
Development, 200 East Grand Avenue, Des Moines, Iowa 50309 ("Department" or "IDED"), City of Dubuque,
City Hall, 50 W 13th ST, Dubuque, IA 52001, ("Community") and Community Housing Initiatives, PO Box 473,
14 West 21st St., STE 3, Spencer, IA 51360, ("Housing Business").
WHEREAS, the purpose of the Enterprise Zone Program is to promote new economic development in
economically distressed areas; and
WHEREAS, the Community has designated and the Department has certified the Enterprise Zone
identified above; and
WHEREAS, eligible housing businesses with projects located in a certified Enterprise Zone are authorized
under this program to receive certain tax incentives and assistance; and
WHEREAS, the Enterprise Zone Commission responsible for the above-identified Zone has recommended
approval and the Department has found the Housing Business' application to be consistent with the Act's eligibility
requirements; and
NOW THEREFORE, in consideration of the mutual promises contained in this Agreement and other good
and valuable consideration, it is agreed as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall apply:
1.1 "Act" means 2003 Iowa Code sections 15E.191 through 15E.196 as amended by 2003 Iowa Acts,
Senate File 441 and House File 576.
1.2 "Administrative Rules" means 261 Iowa Administrative Code, chapter 59.
1.3 "Aareement Effective Date" means the date this Agreement becomes effective and the Housing
Business is authorized to receive program benefits.
1.4 "Aareement Expiration Date" means the date this Agreement ceases to be in force and effect. This
Agreement shall remain in effect untillDED receives written verification that all 36 units have been certified for
occupancy.
1.5 ''Application Approval Date" means the date, as identified above, on which the Director or Director's
designee of the IDED approved the Housing Business' Enterprise Zone application.
1.6
"Board" means the IDED Board.
HEZ
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EZ Agreement # 05-HEZ-053
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1.7 "Commission" or "Entemrise Zone Commission" means the Enterprise Zone commission
established by the Community responsible for the certified Enterprise Zone.
1.8 "DRF" means the Iowa Department of Revenue and Finance.
1.9 "Entemrise Zone" means the site within the Community certified by the Board for the purpose of
attracting private investment.
1.10 "Pro;ect" means the activity, or set of activities, described in this Agreement and the Enterprise
Zone application approved by IDED.
1.11 "Proiect Completion" means the date of completion of construction or if this Project involves
rehabilitation, the date all improvements included in the Project are completed.
ARTICLE II
ENTERPRISE ZONE BENEFITS
2.1 Benefits. The following Enterprise Zone benefits authorized by the Act and IDED administrative
rules are available to the Housing Business under this Agreement:
(a) Investment Tax Credit. The Housing Business may claim an investment tax credit up to a
maximum of 10 percent of the new investment which is directly related to the building or rehabilitating of the units
stated in Article IV, Section 4.1 of this Agreement.
New investment which is directly related to the building or rehabilitating units includes the following costs:
land, surveying, architectural services, building permits, inspections, interest on the construction loan, building
materials, roofing, plumbing materials, electrical materials, amounts paid to subcontractors for labor and materials
provided, concrete, labor, landscaping, appliances normally provided with a new home, heating and cooling
equipment, millwork, drywall and drywall materials, nails, bolts, screws, and floor coverings. New investment does
not include the machinery, equipment, hand or power tools necessary to build or rehabilitate homes.
The new investment that may be used to compute the tax credit shall not exceed the new investment used
for the first one hundred forty thousand dollars of value for each unit. In determining the tax credit, new investment
financed through federal, state, and local government tax credits, grants, and forgivable loans shall not be included.
The tax credit may be used to reduce tax liabilities imposed under Iowa Code chapter 422, Division II,
Division III or Division V or under Iowa Code chapter 432. Any credit in excess of the tax liability for the tax year
may be credited to the tax liability for the following seven years or until depleted, whichever occurs earlier. If the
business is a partnership, subchapter S corporation, limited liability company, or estate or trust electing to have the
income taxed directly to the individual, an individual may claim the tax credit allowed. The amount claimed by the
individual shall be based upon the pro-rata share of the individual's earnings of the partnership, subchapter S
corporation, limited liability company, or estate or trust.
(b) Refund Of Sales. Service And Use Taxes Paid To Contractors Or Subcontractors. The Housing
Business is eligible for a refund of sales, service and use taxes paid by an eligible business, including an eligible
business acting as a contractor or subcontractor as authorized in Iowa Code section 15.331 A.
(i) The Housing Business may apply for a refund of the sales and use taxes paid under Iowa Code
chapters 422 and 423 for gas, electricity, water or sewer utility services, goods, wares, or
merchandise, or on services rendered, furnished, or performed to or for a contractor or
subcontractor and used in the fulfillment of a written contract relating to the construction or
rehabilitation of the units within the Enterprise Zone.
(ii) Taxes attributable to intangible property and furniture and furnishings shall not be refunded.
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EZ Agreement # 05-HEZ-053
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To receive a refund of the sales, service and use taxes paid to contractors or subcontractors, the Housing
Business must, within one year after Project Completion, make an application to the DRF.
2.2 Duration Of Benefits. The Enterprise Zone designation shall remain in effect for ten years following
the date of certification. Any state incentives or assistance that may be conferred must be conferred before the
designation expires. However, the benefits of the incentive or assistance may continue beyond the expiration of
the Enterprise Zone designation.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUSINESS
To induce the Department and the Community to authorize Enterprise Zone benefits referred to in this
Agreement, the Housing Business represents, covenants and warrants that:
3.1 Authoritv. The Housing Business is a corporation duly organized and validly existing under the
laws of its state of incorporation and is in good standing, and has complied with all applicable laws of the State of
Iowa. The Housing Business is duly authorized and empowered to execute and deliver this Agreement. All action
on the Housing Business' part (e.g. where required, appropriate resolution of its Board of Directors) for the
execution and delivery of this Agreement, has been effectively taken.
3.2 Business Information. All written financial statements and related materials concerning the
Housing Business and the Project provided to the Department and the Community are true and correct in all
material respects and completely and accurately represent the subject matter thereof as of the effective date of the
statements and related materials, and no material adverse change has occurred since that date.
3.3 Application. The contents of the application the Housing Business submitted to the Department for
Enterprise Zone program benefits (Attachment A) is a complete and accurate representation of the Housing
Business and the Project as of the date of submission and there has been no material adverse change in the
organization, operation, business prospects, fixed properties or key personnel of the Housing Business since the
date the Housing Business submitted its application to the Department.
3.4 Claims And Proceedinas. There are no actions, lawsuits or proceedings pending or, to the
knowledge of the Housing Business, threatened against the Housing Business affecting in any manner whatsoever
its rights to execute this Agreement or to otherwise comply with the obligations of the Housing Business contained
under this Agreement. There are no actions, lawsuits or proceedings at law or in equity, or before any
governmental or administrative authority pending or, to the knowledge of the Housing Business, threatened against
the Housing Business or affecting the Housing Business' ability to proceed with the Project.
3.5 Permits. All necessary permits have been issued or will be applied for in a timely manner with
reasonable expectation that they will be issued.
ARTICLE IV
CONDITIONS TO RECEIPT OF ENTERPRISE ZONE BENEFITS
The Enterprise Zone Benefits authorized under Article II of this Agreement are available to the Housing
Business provided the Housing Business, (and where applicable, the Community) satisfies each of the following
conditions:
4.1 Build or Rehabilitate. The Housing Business must rehabilitate 36 multi-fammily units in the
Dubuque EZ-2 Enterprise Zone.
4.2 Modest Homes. The single-family homes and dwelling units which are rehabilitated or constructed
by the Housing Business shall be modest homes or units, but shall include the necessary amenities. When
completed and made available for occupancy, the single-family homes and dwelling units shall meet the United
Sates Department of Housing and Urban Development's housing quality standards and local safety standards.
Format revised 712002
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4.3 Completed within Two Years. The Housing Business shall complete its building or rehabilitation
within two years from the time the Housing Business begins construction or rehabilitation of the units described in
Section 4.1.
4.4 Records And Accounts. The Housing Business shall maintain information, books, records,
documents and other evidence concerning the Project, in sufficient detail to permit the Department and the
Community to assess compliance with the terms of this Agreement. The Housing Business shall retain the
aforementioned records for a period of three (3) years from the Agreement Expiration Date.
4.5 Access To Records/Inspections. The Housing Business shall, upon prior reasonable notice and at
any time (during normal business hours), permit the Community and its representatives and the Department, its
representatives or the State Auditor to examine, audit and/or copy:
(i) any plans and work details pertaining to the Project,
(ii) all of the Housing Business' books, records and accounts relating to the Project, and
(iii) all other documentation or materials related to this Agreement.
The Housing Business shall provide proper facilities for making such examination and/or inspection.
Records of the Housing Business furnished to the Department in connection with this Project are subject to the
provisions of Iowa Code chapter 22 and administrative rules adopted by the Department concerning public records
and requests for confidential treatment of records.
4.6 Notice Of Proceedinas. The Housing Business shall promptly notify the Community and IDED of
the initiation of any claims, lawsuits, bankruptcy proceedings or other proceedings brought against the Housing
Business which would adversely impact the Project.
4.7 Reports; Community Monitorina/Reportina.
(a) The Housing Business shall prepare, sign and submit the following reports:
Report
Due Date
Annual Certification
January 30
The Housing Business shall, for the length of its designation as an Enterprise Zone business, certify
annually to the Community and the Department its compliance with the requirements of the Act. The Housing
Business shall use the form provided by the Department for its annual certification. Documentation of compliance
with the conditions detailed in Article IV shall be included with the annual certification.
4.8 Notice Of Business Chanaes. The Housing Business shall provide prompt advance notice to the
Community and the Department of any proposed change in the Housing Business ownership, structure or control
which would materially and directly affect the Project.
ARTICLE V
DEFAULT AND REPAYMENT
5.1 Events Of Default. Enterprise Zone benefits described in Article II are only available to the Housing
Business to the extent the Housing Business satisfies the conditions described in Article IV. Any of the following
shall constitute an Event of Default under this Agreement:
(a) Material Misrepresentation. If at any time any representation, warranty or statement made or
furnished to the Department or the Community by, or on behalf of, the Housing Business in connection with this
Agreement shall be determined by the Department to be incorrect, false, misleading or erroneous in any material
respect when made or furnished.
Format revised 7/2002
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(b) Breach Of Aqreement. If there is a failure of the Housing Business to comply with any of the
covenants, terms or conditions contained in this Agreement.
(c) Relocation Or Abandonment. If there is an abandonment of the Project and the Housing Business
fails to renew the Project within the Enterprise Zone within 30 days. If the relocation or abandonment is due to a
natural disaster (e.g. flood, tornado), the Housing Business shall have 120 days to renew the Project within the
Enterprise Zone.
(d) Insolvencv Or Bankruptcv. If the Housing Business becomes insolvent or bankrupt, or admits in
writing its inability to pay its debts as they mature, or makes an assignment for the benefit of creditors, or the
Housing Business applies for or consents to the appointment of a trustee or receiver for the Housing Business or
for the major part of its property; or if a trustee or receiver is appointed for the Housing Business or for all or a
substantial part of the assets of the Housing Business and the order of such appointment is not discharged,
vacated or stayed within sixty (60) days after such appointment; or if bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceedings or other proceedings for relief under any bankruptcy or similar law or laws for
the relief of debtors, are instituted by or against the Housing Business and, if instituted against the Housing
Business, is consented to, or, if contested by the Housing Business is not dismissed by the adverse parties or by
an order, decree or judgment within sixty (60) days after such institution.
5.2 Notice Of Default.
(a) From Department. If, through the annual certification report or other means, the Department has
reason to believe the Housing Business is in default of the terms of this Agreement, the Department will issue a
written notice of default to the Housing Business, setting forth the nature of the default in reasonable specificity, and
providing therein a reasonable period of time, which shall not be less than 30 days from the date of the notice of
default, in which the Housing Business shall have an opportunity to cure, provided that cure is possible and
feasible. A copy of any Notice of Default will also be provided to the Community and DRF.
(b) From Communitv. If, through monitoring, auditing or other means, the Community has reason to
believe the Housing Business is in default of the terms of this Agreement, the Community will issue a written notice
of default to the Housing Business, setting forth the nature of the default in reasonable specificity, and providing
therein a reasonable period of time,=which shall not be less than 30 days from the date of the notice of default, in
which the Housing Business shall have an opportunity to cure, provided that cure is possible and feasible. A copy
of any Notice of Default will also be provided to the Department and DRF.
5.3 Repavment; Loss of Benefits.
(a) Failure to meet/maintain reauirements. If the Housing Business fails in any year to meet or
maintain anyone of the requirements of the Act, the Housing Business shall repay the value of the incentives
received for each year during which it was not in compliance.
(b) DRF recoverv. Once it has been established, through the Housing Business' annual certification,
monitoring, audit or otherwise, that the Housing Business is required to repay all or a portion of the incentives
received, the DRF shall collect the amount owed. DRF has the authority, pursuant to the Act, to recover the value
of state taxes or incentives provided under the Act. The value of state incentives provided under the Act includes
applicable interest and penalties.
ARTICLE VI
GENERAL TERMS AND PROVISIONS
6.1 Compliance With Laws And Reaulations. The Housing Business shall comply with all applicable
State and federal laws, rules (including the administrative rules adopted by the Department for the Enterprise Zone
Program - 261 Iowa Administrative Code, chapter 59), ordinances, regulations and orders.
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EZ Agreement # 05-HEZ-053
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6.2 Termination. This Agreement may be terminated by the Department or the Community: (a) in the
event of an unremedied material Event of Default by the Housing Business under Article V of this Agreement; or (b)
by mutual agreement of all parties.
6.3 Survival Of Aareement. If any portion of this Agreement is held to be invalid or unenforceable, the
remainder shall be valid and enforceable.
6.4 Governina Law. This Agreement shall be interpreted in accordance with the law of the State of
Iowa, and any action relating to this Agreement shall only be commenced in the Iowa District Court for Polk County
or the United States District Court for the Southern District of Iowa.
6.5 Modification. This Agreement may only be modified by a written document signed by all Parties.
6.6 Notices. Whenever this Agreement requires or permits any notice or written request by one party
to another, it shall be in writing, enclosed in an envelope, addressed to the party to be notified at the address
heretofore stated (or at such other address as may have been designated by written notice), properly stamped,
sealed and deposited in the United States Mail. Any such notice given hereunder shall be deemed delivered upon
the earlier of actual receipt or three (3) business days after posting. The Department may rely on the addresses of
the Housing Business and Community set forth heretofore, as modified from time to time, as being the addresses of
the Community and Housing Business.
6.7 Waivers. No waiver by a party of any Event of Default hereunder shall operate as a waiver of any
other Event of Default or of the same Event of Default on any future occasion. No delay on the part of a party in
exercising any right or remedy hereunder shall operate as a waiver thereof. No single or partial exercise of any
right or remedy by a party shall preclude future exercise thereof or the exercise of any other right or remedy.
6.8 Headinas. The headings in this Agreement are intended solely for convenience of reference and
shall be given no effect in the construction and interpretation of this Agreement.
6.9 Intearation. This Agreement contains the entire understanding between the Community, Housing
Business and the Department and any representations that may have been made before or after the signing of this
Agreement, which are not contained herein, are nonbinding, void and of no effect. None of the parties have relied
on any such prior representation in entering into this Agreement.
6.10 Counteroarls. This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.
6.11
reference:
Documents Incoroorated Bv Reference. The following documents are hereby incorporated by
(a)
(b)
Attachment A, "Housing Business' Enterprise Zone Application."
Attachment B, "Enterprise Zone Commission Resolution Approving the Housing Business'
Enterprise Zone Application."
6.12 Order Of Priority. In the event of a conflict between documents of this Agreement, the following
order of priority shall govern:
(a) Articles 1 through 6 herein.
(b) Attachment A, "Housing Business' Enterprise Zone Application."
(c) Attachment B, "Enterprise Zone Commission Resolution Approving the Housing Business'
Enterprise Zone Application."
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
Effective Date first stated:
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FOR THE COMMUNITY:
City of Dubuque
FOR IDED:
Signature
Michael Miller, Investment Management
Type or Print Name, Title
FOR THE HOUSING BUSINESS:
Community Housing Initiatives
Signature
Type or Print Name, Title
Format revised 7/2002
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ATTACHMENT A
Housing Business' Enterprise Zone Application
HEZ
Format revised 7/2002
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IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
APPLICATION for ENTERPRISE ZONE BENEFITS
Housing Development r
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Washington Court Apartments
Dubuque Casket Co. Building
Iowa Department of Economic Development
Division of Business Development
200 East Grand Avenue
Des Moines, Iowa 50309
APRIL 2002
INTENT: The Enterprise Zone Program was established by the Iowa Legislature with the intent of promoting
new economic development in economically distressed areas of Iowa by encouraging communities to target
resources in ways that attract productive private investment.
PROJECT INITIATION: Projects that have already been initiated before receiving formal application approval
by the Iowa Department of Economic Development shall not be eligible for tax incentives and assistance under
this program.
"Project initiation" means anyone of the following: the start of construction of new or expanded buildings; the
start of rehabilitation of existing buildings; the purchase or leasing of existing buildings; or the installation of new
machinery and equipment or new computers to be used in the operation of the business' project. The purchase of
land or signing an option to purchase land or earth moving or other site development activities not involving
actual building construction, expansion or rehabilitation shall not constitute project initiation.
GENERAL INSTRUCTIONS
1. If more than six months has elapsed since the date on the front of this application, please contact IDED to see
if this version of the application is still current.
2. Before filling out this application form, please read Iowa Code Sections 15E.l91 through 15E.196, as
amended and the Enterprise Zone administrative rules.
3. Only typed or computer-generated applications will be accepted and reviewed. (Contact the IDED to have an
electronic copy of this application e-mailed to you.) Anv material change to the format, questions or wording
of questions presented in this application, will render the application invalid and will not be accepted.
4. Complete the application fully; if any questions are left unanswered or required attachments are not
submitted, an explanation must be included.
5. Use clear and concise language. Attachments should only be used when requested or as supporting
documentation.
6. Any inaccurate information of a significant nature may disqualify the application from consideration.
7. Send the original plus two copies of the completed application form and all required attachments to:
Kent Powell
Housing Fund Compliance Specialist
Iowa Department of Economic Development
200 East Grand Avenue
Des Moines, Iowa 50309
Phone: (515) 242-4786
Fax: (515) 242-4809
E-mail: kent.powell@ided.state.ia.us
It is not necessary to bind the application and/or the required attachments. Staples and/or binder clips may
be utilized. Please provide photocopies of any documents, which in their original form, IDED would not be
able to 2-hole punch for purposes of creating the applicant's file.
1
April 2002
PUBLIC RECORDS POLICIES
The Iowa Department of Economic Development (IDED) is subject to the Open Records law (2001 Iowa Code,
Chapter 22). Treatment of information submitted to IDED in an Enterprise Zone application is governed by the
provisions of the Open Records law. All public records are available for public inspection. Some public records
are considered confidential and will not be disclosed to the public unless ordered by a court, the lawful custodian
of the record, or by another person duly authorized to release the information. Copies ofIowa's Open Records
law and IDED's administrative rules relating to public records are available from the Department upon request.
APPLICANT INFORMATION
Name of Housing Business: Washington Court, L.P.
Contact Name & Title: Doug LaBounty, President, Community Housing Initiatives, Inc.
Address: PO Box 473,14 West 21st Street
City, State & Zip Code: Spencer, IA 51301
Telephone: 712.262.5965
Fax: 712.262.1192
J~PI Of ECOf';:OM~C
E-mail Address:dlchi@longlines.com
jUN 2 9 2005
Taxpayer Identification No.: 20-1845756
Local Enterprise Zone Commission
Enterprise Zone Commission Name: Dubuque Enterprise Zone Commission
Contact Name & Title: Pamela Myhre, Economic Development Planner
Organization: City of Dubuque, Iowa
Address: City Hall, 50 W.13th Street
City, State & Zip Code: Dubuque, IA 52001
Telephone: 563.589.4393
Fax: 563.589.1733
E-mail Address: pmyhre@cityofdubuque.org
2
April 2002
CERTIFICATION & RELEASE OF INFORMATION
I, the undersigned, on behalf of the Housing Business identified above, hereby submit the following application
under Iowa Code Sections 15E.191 through 15E.196. I certify that the Housing Business is in good standing, and
has complied or will upon receipt of approval by the Department, with all applicable laws of the State of Iowa to
conduct business within the State. I certify that all information, representations, or statements provided to the
Iowa Department of Economic Development (IDED), in connection with this application, are true and correct in
all material respects.
I certify and understand that in order to receive benefits under the Enterprise Zone Program that the project
described in this application has not been initiated and that the project will not be initiated until the business
receives final approval of this application from the IDED.
I hereby give permission to IDEO to make credit checks. contact the company's financial institution(s),and
perform other related activities necessary for reasonable evaluation of this application.
I understand this application is subject to final approval by the Department and am aware that Enterprise Zone
benefits are not available until final Department approval is secured and an agreement is executed with the
Housing Business, IDED and the Community, within a reasonable time period following approval. This
application will be used as the basis for the Enterprise Zone agreement.
~~. +
Doug LaBounty. President of Community Housin2 Initiatives. Inc.. General Partner
Print name and title
5"-3-0.0
Date
For the Enterprise Zone Commission; r
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Signature, Title
K,ebo.rj Sk: n
Print name and title
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to. rJ7-tJS'
Date
3
April 2002
APPLICATION INFORMATION
1. Please provide a brief description of the proposed housing development project.
Conversion of the upper floors of the historic "Dubuque Casket Company" building, located at
1798 Washington Street, into 36 rental units. The rehabilitation will be completed in accordance
with standards issued by the National Park Service. Construction will begin in the summer of 2005
and be completed late in 2006.
2. In which Enterprise Zone will this project occur (include the zone's name, number, size in acres, and date
certified)?
EZ-2; 376 acres; 12-16-04 IDED approved expansion of this zone; expires 4/15/08
3. Does the project involve new construction or rehabilitation?
Rehabilitation
4. How many single-family homes or multi-family units are proposed?
36
5. What will be the per unit value of the housing?
Estimated appraised value of the completed units is $40,000 per unit.
6. The single family homes or multi-family units being constructed or rehabilitated must be modest homes
or units and include the necessary amenities. Please explain how the proposed project will satisfy this
requirement?
The project's amenities will be typical as compared to other recent rental housing developments.
Amenities include onsite parking, community room, laundry facilities, elevator and central air
conditioning.
7. Will the project meet U.S. Department of Housing and Urban Development Housing Standards and
applicable local codes?
Yes.
8. What is the current status of the project? When is construction scheduled to begin? What is the
anticipated project completion date?
The project received awards of Low Income Housing Tax Credits and HOME funds in March. We
are currently negotiating the terms of the equity investment and bank financing. Construction
should begin the summer of 2005 and be completed late in 2006.
4
April 2002
. .
9. Attach a legal description of the business site on which the project will occur.
Attached.
10. Attach a detailed map (no larger than 8" x 14") showing the housing development site in relation to the
boundaries of the certified Enterprise Zone.
Attached.
11. Is any part of the project located in a 100-year flood plain?
No
12. Please indicate the total capital investment that will be made as the result of this project?
Description of Capital Expenditure Amount
Building and Land Acquisition $575,000
Construction $3,562,000
Developer, Architect, Engineer, Consultant Fees $840,000
Soft Costs $276,870
Operating and Lease-Up Reserve $115,000
Total $5,368,870
13. Please identify the sources of project financing that will be utilized and the amount of the financing. (The
total amount of the financing should equal the total expenditures in Question #12.)
Source of Project Financing Amount
Bank Financing $565,870
IDED Housing Fund $800,000
City of Dubuque - CDBG $200,000 JI
-
Developer and Investor Equity $3,604,000 - 4\- -;) rfiJ,fJV v rJf
Sales Tax Rebate and Ent Zone Equity $199,000
Total $5,368,870
P-t, ..~.tS ~
11) .,(~,,(Iff
14. For purposes of determining the amount of investment tax credits the housing business may receive, the
Iowa Department of Economic Development cannot include capital expenditures financed through
federal, state, and local government tax credits, grants and forgivable loans. Based on this information,
what portion of your total capital investment (identified in Question #12) will be eligible for the
investment tax credit?
$1,824,870 (estimated)
15. Please attach a long-term plan for the proposed housing development project including labor and
infrastructure needs.
Attached.
5
April 2002
. . .
16. What economic benefits will the project bring to the area?
In addition to the economic impact of the construction related activity, the project represents an
important investment in an area targeted by local officials for revitalization.
17. Explain why the proposed project would be considered a good housing development project.
The project addresses three important issues. First, the building will be an addition to Dubuque's
exemplary stock of historical structures. Second, the project adds needed affordable rental
housing. Finally, as previously discussed, the project's neighborhood is target for revitalization by
local officials.
18. Please attach an affidavit that states the Housing Business has not, within the last five years, violated state
or federal environmental and worker safety statutes, rules, and regulations or, if such violations have
occurred, that there were mitigating circumstances or such violations did not seriously affect public health
or safety or the environment.
Attached.
19. Explain why Enterprise Zone Benefits are needed in order for the project to proceed.
While the Enterprise Zone benefits may seem inconsequential to the overall $5.3 million budget,
both the tax rebate and tax credits represent critical gap financing needed by the project. The
amount of the bank loan cannot be increased due to the rent restrictions on the project.
20. Please indicate the amount of Enterprise Zone tax benefits being requested for this project.
State Sales, Service, and Use Tax Refund:
$63.000
Investment Tax Credit:
$182.487 ($136.00 equity to proiect
21. Please list any additional requirements adopted by the local Enterprise Zone Commission and explain
how the Housing Business will meet each requirement.
Not Applicable.
6
April 2002
l . .
ATTACHMENTS
Please make sure the following items are included with this application:
Housing Business:
o Legal description of the business site on which the project will occur.
o Detailed map (no larger than 8" x 14") showing the business site in relation to the boundaries of the certified
Enterprise Zone.
o Long term strategic plan, which includes labor and infrastructure needs.
o Affidavit that states the Business has not, within the last 5 years, violated state or federal environmental and
worker safety statutes, rules, and regulations.
Enterprise Zone Commission:
o Resolution by the Enterprise Zone Commission approving this application.
o Proof that the meeting, in which this application was approved, was open to the public (i.e. public notice
which was published and/or posted).
o Meeting minutes from the meeting, in which this application was approved.
7
April 2002
, . 1
Legal Description
Lot 102,103,104,105 and 106, East Dubuque Addition, City of
Dubuque, Dubuque County, Iowa
And
Lot 159, 160 and 161 East Dubuque Addition
. . 1
Enterprise Zone Map
, ,
"pp.u- j e: c.r
- -.. ....... ------ -- ..-.
. .
, Photos - 1024276001
Page 1 of 1
Parcel 10: 1024276001
Photo 1
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httn:1 Iwww_duhuQuea<;sessOT.om/nmc/nrintPackal!e.asn?nid= 1 02427600 1
8/4/2004
. ,
Long-Term Strategic Plan
Long-term plan for the proposed housing development project including labor and
infrastructure needs.
Washington Court will be financed in part by Federal and State programs which require
certain long-term occupancy and rent restrictions. For at least 30 years, none of the units
can be leased to households above 60% of the area median income for Dubuque. In
addition, rents cannot exceed the HOME program rents issued annually by the U.S.
Department of Housing and Urban Development.
As the building has been in place nearly one hundred years, all necessary infrastructure is
available to the project. Initial labor needs include construction related trades to be
employed by the general contractor and subcontractors. Long-term labor needs for the
project will be limited to management and maintenance staff.
The project will be managed by Community Housing Initiatives, Inc., (CHI) the general
partner of Washington Court, L.P. (housing business) and Gronen Properties of Dubuque.
CHI currently manages nearly 800 units throughout Iowa, with another 80 units under
development. CHI will utilize contracted local professionals for cleaning, maintenance
and repairs. Gronen Properties will be contracted as the on-site manager and will be
available to market the apartments, answer questions and coordinate repairs.
The project has adequate amounts budgeted annually for recurring maintenance and
repairs. In addition, capital replacement reserves will be funded at the rate of $300 per
unit per year.
Washington Court, L.P. will be the owner of the project for 18 years, at which time
Community Housing Initiatives, Inc. will exercise its right of first refusal to assume
ownership. All occupancy and rent restrictions will remain in place after the transfer of
ownership.
, .
Environmental and Safety Affidavit
, I
. .
WASHINGTON COURT ENTERPRISE ZONE APPLICATION
AFFIDAVIT
I, Doug LaBounty, President of Community Housing Initiatives, Inc., general partner of
Washington Court, L.P., do hereby declare that neither Washington Court, L.P. or
Community Housing Initiatives, Inc. have, within the last five years, violated state or
federal environmental or worker safety statutes, rules or regulations.
Doug LaBounty Presi ent, Community Housing Initiatives, Inc., General Partner of
Washington Court, L.P.
S-3-0?
Date
" -'I. .
ATTACHMENT B
Enterprise Zone Commission Resolution Approving the Housing Business'
Enterprise Zone Application
HEZ
Format revised 7/2002
~ " .
JUI~ 2 Q 2005
OF COMMUNITV
;"1"'. '('''LOP~VlEN I r
, j ,. ,} .- T
I.... t..:. V a..
A RESOLUTION APPROVING THE FILING OF AN APPLICATION WITH
THE IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT REQUESTING
ENTERPRISE ZONE BENEFITS ON BEHALF OF WASHINGTON COURT, L.P.
CITY OF DUBUQUE, IOWA
ENTERPRISE ZONE COMMISSION
. . '. L.:PT. OF ECONOMIC DEVELOPMENT
RESOLUTION 1-05
Whereas, the State oflowa Department of Economic Development (IDED) is accepting
applications from eligible businesses pursuant to the authority of House File 724, Enterprise
Zone Legislation; and
Whereas, the City of Dubuque, Iowa has two certified Enterprise Zones; and
Whereas, the City's Enterprise Zone Commission has been created by City Ordinance to
review applications for tax incentives and assistance based on criteria specified by law and to
,transmit its recommendation to the IDED; and
Whereas, the City's Enterprise Zone Conimission has reviewed an application from
Washington Court, L.P. and has found the housing developer eligible to apply for Enterprise
Zone benefits.
NOW, THEREFORE, BE IT RESOLVED BY THE ENTERPRISE ZONE
COMMISSION OF THE CITY OF DUBUQUE, IOWA:
Section 1.
is approved.
That the Washington Court, L.P. application for Enterprise Zone benefits
Section 2. That Washington Court, L.P. will create thirty-six (36) new housing units
in the city's downtown.
Section 3. That Washington Court, L.P. will invest approximately $5,368,870 in
Enterprise Zone 2 as part of the historic renovation project.
Section 3. That the Chairperson is hereby authorized and directed to execute, on
behalf of the Enterprise Zone Commission, the joint application for Enterprise Zone benefits.
Passed, approved and adopted this 27th day of June 2005.
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Richard Stein
Chair
F:\USERS\Pmyhre\ WPDOCS\EZ\ WASHINGTON COUR 1\adoptresolution.doc