Lange Estate Urban Revitalization Plan_Initiate Copyright 2014
City of Dubuque Items to be set for Public Hearing # 1.
ITEM TITLE: Lange Estate Urban Revitalization Plan
SUMMARY: City Manager recommending approval of resolution
directing the Lange Estates Urban Revitalization Plan
(Applewood IV) be set for public hearing on March 7, 2016.
RESOLUTION Finding that the designation of the Lange
Estate Urban Revitalization Plan is necessary to encourage
needed housing and residential development providing
safe, affordable housing for the residents of the City of
Dubuque, Iowa and providing for a public hearing thereon
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Adopt
Resolution(s), Set Public Hearing for 3/7/16
ATTACHMENTS:
Description Type
Lange Estate Urban Revitalization Plan-MVM Memo City Manager Memo
Staff Memo Staff Memo
Lange Estate Urban Revitalization Plan Supporting Documentation
Resolution Resolutions
THE CITY OF Dubuque
UBE I
erica .i
Masterpiece on the Mississippi 2007-2012-2013
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Request for Public Hearing for Designation of Lange Estate Urban
Revitalization Area District
Horizon, Applewood IV
DATE: January 12, 2016
Housing and Community Development Department Director Alvin Nash requests the
City Council approve a resolution directing the Lange Estates Urban Revitalization Plan
be set for public hearing on March 7, 2016.
1 concur with the recommendation and respectfully request Mayor and City Council
approval.
Micliael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Alvin Nash, Housing & Community Development Department Director
THE CITY OF Dubuque
AII-Ame1 rica City
DUBgkE r
Masterpiece on the Mississippi 2007.2012.2013
TO: Michael Van Milligen, City Manager
FROM: Alvin Nash, Housing & Community Development Director
DATE: January 12, 2016
RE: Request for Public Hearing for Designation of Lange Estate Urban
Revitalization Area District
Horizon, Applewood IV
Introduction
This memorandum presents for City Council a petition for Urban Revitalization Area
Designation from Horizon. The memorandum recommends the City Council review and
approve the attached resolution to establish Lange Estate as a property that meets the
requirements for designation as required by Chapter 404 of the Iowa Code.
Background
Urban Revitalization Chapter 404 of the Iowa Code (Urban Revitalization Act)
authorizes cities to designate areas as urban revitalization areas. Improvements to
qualified real estate within these designated areas may receive a total or partial
exemption from property taxes for a specified number of years. The exemptions are
intended to stimulate private investment by reducing tax increases that usually
accompany property improvements. This additional private investment provides a
long-term increase or stabilization in the area's tax base, enhances the visibility of
revitalization areas and/or supports important city objectives such as historic
preservation, economic development and affordable housing development.
In order to implement the provisions of Chapter 404, the City determine the area is
eligible for exemption, prepare a revitalization plan for each designated area, and hold
at least one public hearing after proper notice. The law mandates specific criteria and
procedures must be followed.
Discussion
The development plan provides for the construction of a 60-unit planned residential
housing development for seniors, Applewood IV. The planned development is located
at 3275 Pennsylvania Avenue and is the fourth installment in a series of senior housing
developments Horizon has provided in the area. Horizon development is proposing a
$9.2 million dollar project utilizing private financing, state HOME Funds, Federal Home
Loan Bank Des Moines AHP, Tax Credit Equity, and Tax Abatement incentives to
finance the project. The urban revitalization tax exemption will show local support for
the project, which will strengthen Horizon's Tax Credit application to the Iowa Finance
Authority.
The proposed Urban Revitalization plan for Lange Estates will provide for an
exemption under 404.3(4) and permit a one hundred percent exemption from taxation
on the actual value added by improvements for qualified real estate assessed as
residential property or assessed as commercial property, for a period of ten years.
Horizon has agreed to this exemption schedule.
This assistance is very important to the success of the project. The application for
state tax credits is competitive. A developer receives points for city financial
assistance, with maximum points provided for assistance equaling 7% of project costs.
Chapter 404 provides for a public comment period prior to the adoption of an urban
revitalization plan. Additionally, the City's Code of Ordinances requires comment by the
Long Range Planning Commission on any urban revitalization plan. Based upon these
requirements, the Council is requested to set a public hearing for March 7, 2011 that will
provide a 30 day comment period on the proposed plan. The property owners will be
notified. The Long Range Planning Commission will review the plan at their January 20,
2016 meeting.
Budgetary Impact
The property value, based upon 2015 Beacon data, is $96,740 for land and $83,490 for
dwelling for a total taxable value of$180,230. Dubuque City Assessor Rick Engelken
estimates after improvements the assessed value for taxation will be $2,170,883. At the
City of Dubuque 2015 tax rate of 0.03301933, the annual property tax increase over
existing is estimated to be $71 ,681 . The abatement of$71 ,681 will be in effect for 10
years for a total of$716,810. After the abatement period expires the property will be
taxed based on the assessed value for taxation as determined by the assessor.
Recommendation
I recommend that the City Council approve the attached resolution directing the Lange
Estates Urban Revitalization Plan be set for a public hearing on March 7, 2016.
Action Requested
The Action Step is for the City Council to adopt the attached resolution.
Prepared by: Erica Haugen, Community Development Specialist
F:\USERS\CDBG\Urban Revite\Applewood 4\Memo to Council.doc
2
RESOLUTION NO. 18-15
RESOLUTION FINDING THAT THE DESIGNATION OF THE LANGE ESTATE
URBAN REVITALIZATION PLAN IS NECESSARY TO ENCOURAGE NEEDED
HOUSING AND RESIDENTIAL DEVELOPMENT PROVIDING SAFE, AFFORDABLE
HOUSING FOR THE RESIDENTS OF THE CITY OF DUBUQUE, IOWA AND
PROVIDING FOR A PUBLIC HEARING THEREON
Whereas, the City Council of the City of Dubuque finds that the property at 3275
Pennsylvania Avenue is currently vacant and underutilized, and
Whereas, Horizon has proposed to develop the property and construct a 60 -unit
residential housing development for seniors and requests the establishment of an urban
revitalization district; and
Whereas, the area proposed for designation under the Urban Revitalization Act there
is need for public improvements related to housing; and the encouragement of housing
and residential development as defined by Section 404.1(5) of the Iowa Code; and
Whereas, Chapter 404 of the Code of Iowa provides that a public hearing shall be
held on any proposed Urban Revitalization Area Plan; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the new construction for housing development of the Property legally
described as:
Lot Two of Lange Estate in the County of Dubuque, City of Dubuque, Iowa,
according to the recorded plat thereof, is found to be necessary and in the
interest of residents of the City.
Section 2. That the Lange Estate Urban Revitalization Plan as proposed meets the
eligibility criteria of Chapter 404.1(5) of the Code of Iowa, 2015.
Section 3. That the proposed Lange Estate Urban Revitalization Area Plan attached
hereto, shall be a matter of record and shall be available for pubic inspection in the
office of the City Clerk at City Hall, 50 West 13th Street, Dubuque, Iowa.
Section 4. That the City, upon approval of the Plan, shall provide urban revitalization
tax exemption to qualified applicants in designated area; and
Section 5. That the City is authorized and directed to submit the Lange Estate Urban
Revitalization Area Plan to the City's Long Range Planning Advisory Commission for
review and comment; and
Section 6. That the City Clerk is directed to publish notice of a public hearing on the
Lange Estate Urban Revitalization Area Plan to be held on March 7th, 2016 at 6:30 p.m.
in the City Council Chambers, 350 West 6th Street, Dubuque, Iowa 52001; and
Section 7. That the owners of record will be notified by the thirtieth day prior to the
public hearing.
Passed, approved and adopted this 19th day of January, 2016..
is W. o % es, Mayor Pro -Tem
Attest:
Kevi i S. Firnstahl, City -perk
CITY OF DUBUQUE, IOWA
OFFICIAL NOTICE
NOTICE OF PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA, ON THE MATTER OF THE ADOPTION OF A PROPOSED
URBAN REVITALIZATION PLAN FOR THE LANGE ESTATE URBAN
REVITALIZATION PLAN
Public notice is hereby given that the Council of the City of Dubuque, Iowa, will hold a
public hearing on March 7, 2016, at 6:30 p.m., in the Historic Federal Building, 350
West 6th Street, Dubuque, Iowa, at which meeting the City Council proposes to take
action on the adoption of an urban revitalization plan designated as the Urban
Revitalization Plan for the Lange Estate (the "Plan") under the authority of Chapter 404,
Code of Iowa, as amended.
The property which comprises the revitalization area within which the Plan shall
be applicable is legally described as Lot Two of Lange Estate in the County of
Dubuque, City of Dubuque, Iowa, according to the recorded plat thereof.
(Applewood IV)
Chapter 404, Code of Iowa, as amended, and the Plan authorize the City to make
property tax exemptions for property on which improvements have been made.
Any persons interested may appear at said meeting of the City Council and present
evidence for or against the adoption of the Plan. The proposed Plan is on file in the
office of the City Clerk and available for public inspection or copying during regular
office hours.
Written comments regarding the above public hearings may be submitted to the City
Clerk's Office on or before said time of public hearing at 50 W. 13th Street, or
ctyclerk@cityofdubuque.org. At said time and place of public hearings all interested
citizens and parties will be given an opportunity to be heard for or against said proposal.
Any visual or hearing impaired persons needing special assistance or persons with
special accessibility needs should contact the City Clerk's Office at (563) 589-4100 or
TDD (563) 690-6678 at least 48 hours prior to the meeting.
This notice is given by order of the City Council of the City of Dubuque, Iowa.
Dated this 19th day of February, 2016.
Kevin Firnstahl, City Clerk of Dubuque, Iowa
Lange Estate Urban Revitalization Plan
For Public Review until March 7, 2016
Contents
Introduction.........................................................................................................................................2
TheArea ...............................................................................................................................................3
Availabilityof Funding......................................................................................................................4
RevenueBonds ..................................................................................................................................4
Relocation............................................................................................................................................4
Qualificationof Areas.......................................................................................................................5
RevitalizationProgram .....................................................................................................................5
ApplicationProcedure......................................................................................................................7
Conclusion...........................................................................................................................................s
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LANGE ESTATE URBAN REVITALIZATION PLAN
For Public Review Until March 7, 2016
Introduction
The following plan describes certain provisions of the Iowa Urban Revitalization
Act and proposes the Lange Estate Urban Revitalization area.
The State of Iowa, under Iowa Code Chapter 404, allows cities to designate
areas as urban revitalization districts. Under this Act, improvements to qualified
areas may receive a total or partial exemption from property taxes for a specified
number of years. The exemptions are intended to stimulate private investment
through the reduction of tax increases related to property improvements.
Once an area is deemed to meet the requirements established in Chapter 404, a
plan must be established which identifies the district boundaries, property
owners, existing conditions, proposed plans and the basic abatement provisions
for the revitalization area.
Iowa Code Chapter 404.1 lists five reasons for which a city or county may
establish urban revitalization plans. These include:
1 . The existence of numerous buildings that are dilapidated or deteriorated;
2. The need for preservation and restoration of buildings due to their historic
significance;
3. The area is appropriated as an economic development region as defined
in Iowa Code 403.17;
4. The need for public improvements related to housing;
5. The encouragement of housing and residential development.
The Lange Estate Urban Revitalization Plan will be based upon the need for the
encouragement of housing and residential development, as defined in 404.1 (5)
an area designated as appropriate for public improvements related to housing
and residential development, or construction of housing and residential
development, including single or multifamily housing.
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The Area
Location
Exhibit A identifies the location of the Revitalization District. The 2.76 acre
site to be included in the Lange Estate Urban Revitalization Area is located at
3275 Pennsylvania Avenue, Dubuque, IA 52001 , legally described as:
Lot Two of Lange Estate, in the City of Dubuque, IA
Zoning
Exhibit B shows the existing zoning districts. The existing zoning
classification is: Planned Unit Development with a PR Planned Residential
designation.
The City Council approved a zoning ordinance reclassifying the property
located at 3275 Pennsylvania Avenue from R-1 Single-Family Residential
district to PUD Planned Unit Development District with a PR Planned
Residential District Designation on September 21 , 2015 to permit
construction of a 60 —unit Senior Apartment Residence, Applewood IV.
Existing and Proposed Land Use
Exhibit C identifies the existing primary land use for the proposed district.
East of the subject parcel there is multi-family development from 3125 to
3225 Pennsylvania Avenue, single family and commercial uses along John F.
Kennedy. An unoccupied single family home is located on the parcel. The
existing structure will be removed and a 60-unit senior housing community
will be developed. The senior housing will provide a range of affordable rents
and amenities that include a community room, leasing office, exercise room,
and heated underground parking.
Assessed Valuations and Owners of Records
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The existing assessed valuation of the real estate in the Revitalization District
as of October 26, 2015 is $180,230. $96,740 is the Assessed Land Value,
$83,490 is the Assessed Dwelling Value. The 2015 Net Assessed Value is
based on a residential classification.
City Services
There are no current plans to expand or improve City services to this area.
Currently the area enjoys the same level of City services as most other areas
of the City.
Availability of Funding
The development of the property will be funded with Iowa Low Income
Housing Tax Credits, permanent mortgage, State HOME Funds, Federal
Home Loan Bank Des Moines AHP, deferred development fee, and Tax
Credit Equity.
Revenue Bonds
There are no plans to issue revenue bonds for revitalization projects in this
area.
Relocation
No relocation is expected due to rehabilitation since the only structure on the
property is currently vacant.
Should relocation occur as a result of rehabilitation in the proposed district,
the person(s) causing a qualified tenant to be displaced shall pay all of the
relocation costs of the tenant as a condition for receiving a tax-exemption
under Iowa Code Section 404.3. "Qualified tenant" shall mean the legal
occupant of a residential dwelling unit which is located within this designated
revitalization area and who has occupied the same dwelling unit continuously
since one year prior to the city's adoption of this plan pursuant to Iowa Code
Section 404.2.
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Qualification of Areas
The Lange Estate Urban Revitalization District Area, for purposes of this
initiative, is an area bounded by Pennsylvania Avenue to the south, and is
adjacent to the rear lot-lines of single-family residences along Carter Rd to
the north. Applewood Senior Housing Projects I, II, and III extend east along
Pennsylvania Avenue. To the west, zoning allows commercial property.
The proposed development of Applewood Phase IV Senior Housing Project
is a Planned Unit Development for a building with 60 residences. The
property had previously been used by the Lange Family as an orchard for
many years. The property around the Lange property has been developed
for single family residential, commercial, and the first three phases of
Applewood Senior Apartments.
Information provided by the City Assessor's Office indicates that this area
contains one single family residence valued at $180,230. The single-family
home in the proposed district is currently vacant and in a state of disrepair.
Revitalization Program
Tax Exemption
a) Residential property, assessed as residential or assessed as commercial
property, if the commercial property consists of three or more separate
living quarters with at least seventy-five percent of the space used for
residential purposes, is eligible to receive a one hundred percent
exemption from taxation on the actual value added by the improvements.
The exemption is for a period of ten years. The property tax exemption
will be in accordance with the Code of Iowa, Chapter 404.3(4), providing
for a ten-year, 100% exemption of the actual value added by the
improvements.
b) "Qualified real estate" means real property, other than land, which is
located in a designated revitalization area and to which improvements
have been added, during the time the area was so designated, which have
increased the actual value by at least fifteen percent., or at least ten
percent in the case of real property assessed as residential, or which
have, in the case of land upon which is located more than one building
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and not assessed as residential property, increased the actual value of the
buildings to which the improvements have been made by at least fifteen
percent. "Qualified real estate" also means land upon which no structure
existed at the start of the new construction, which is located in a
designated revitalization area and upon which new construction has been
added during the time the area was so designated.
c) Property tax exemption shall be available only for new construction within
the designated area. "Actual value added by improvements" means the
actual value added as of the first year for which the exemption was
received. To qualify for exemption, improvements to qualified real estate
must increase the value of the property by ten percent for real property
assessed as residential property or fifteen percent for land upon which is
located more than one building and not assessed as residential property,
increase the actual value of the buildings to which the improvements have
been made by at least fifteen percent.
d) Any improvements that were assessed before the area was officially
designated will not be eligible for exemption. Improvements begun prior to
one year prior to the area becoming designated will not be eligible for
exemption.
e) Improvements must result in that structure meeting applicable building,
plumbing, mechanical, electrical, and other code requirements of the City
of Dubuque.
f) The actual value of the improvements must result in an increase in
assessed value as stated above in (b). Each year an application is made
for tax exemption, the assessed value must have increased in that year by
the required percentage.
g) The designation of the Lange Estate Urban Revitalization Area will remain
in effect for five (5) years from designation. All existing exemptions will
continue until their previously established expiration date. Upon repeal of
the ordinance establishing this revitalization area, all existing exemptions
would continue until their previously established expiration date.
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Application Procedure
This area, upon designation, will follow the procedures for application and
granting of the property tax exemption within the City of Dubuque.
a) The property owner must apply for an exemption by February 1 sc of the
assessment year for which the exemption is first claimed, but not later
than the year in which all the improvements included in the project are first
assessed for taxation, or the following two assessment years, in which
case the exemption is allowed for the total number of years in the
exemption schedule. Upon the request of the owner, the governing body
of the City may provide by resolution that the owner may file an application
no later than February 1 of the tenth assessment year.
b) The application must contain, at a minimum, the following:
a. The nature of the improvements,
b. The cost of the improvements,
c. The actual or estimated date of completion, and
d. The tenants occupying the property as of the date of the City's
resolution adopting this plan.
c) The City reviews all applications to determine whether the improvement
project conforms to the revitalization plan, is within a designated area, and
if the improvements were made during the appropriate time period. If the
project meets all three criteria, the City shall forward the application to the
assessor by March 1 st, with a statement as to which exemption applies.
Applications for exemptions for succeeding years on approved projects
shall not be required.
d) The local assessor shall review each application by making a physical
review of the property, to determine if the improvements made increased
the actual value of the qualified real estate by at least fifteen percent or
ten percent in the case of real property assessed as residential property.
If the assessor determines that the actual value of that real estate has
increased by at least the requisite percent, the assessor shall certify the
property valuation, determined pursuant to the tax exemption schedule, to
the County Auditor at the time of transmitting the assessment rolls. The
assessor shall notify the applicant of the determination, and the assessor's
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decision may be appealed to the local board of review at the time
specified in Iowa Code. The property owner may also refile an application
in a subsequent year after additional improvements have been made.
e) After the tax exemption is granted, the assessor shall continue to grant the
tax exemption, with periodic physical review by the assessor, for the ten-
year time period specified in the tax exemption schedule.
f) An application for exemption received by February 1 in any year after the
year in which the improvement was completed and first assessed for
taxation, is a late application. Late application may be made in any year
up to the tenth year following completion of the improvement. The
exemption period will be the remainder of the ten year period, which
began upon completion of the improvement, except the total number of
years in the exemption schedule will be allowed if a claim for exemption is
filed within two years of the February 1 filing deadline.
Conclusion
The proposed urban revitalization district will assist the development of
affordable housing for vulnerable populations by providing needed housing
units for seniors in Dubuque. After the ten-year abatement period lapses on
these projects, the full assessed value of the rehabilitation property will go on
the tax rolls to the benefit of the entire community.
F:\USERS\CDBG\Urban Revite\Petitions for Districts\Applewood IV 2016\Lange Estates Urban
Revit Plan.doc
Exhibit A: Location of Urban Revitalization District
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