Paragon Square Urban Revitalization Plan_Initiate Copyright 2014
City of Dubuque Items to be set for Public Hearing # 3.
ITEM TITLE: Paragon Square Urban Revitalization Plan
SUMMARY: City Manager recommending approval of a resolution
directing the Paragon Square Urban Revitalization Plan
(Former Holy Ghost School) be set for public hearing on
March 7, 2016.
RESOLUTION Finding that the designation of the Paragon
Square Urban Revitalization Plan is necessary for
rehabilitation and conservation of the hereinafter described
property and Urban Revitalization Area is necessary in the
interests of the public health, safety, and welfare of the
residents of the City
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Adopt
Resolution(s), Set Public Hearing for 3/7/16
ATTACHMENTS:
Description Type
Paragon Square Urban Revitalization Plan-MVM Memo City Manager Memo
Staff Memo Staff Memo
Paragon Square Urban Revitalization Plan Supporting Documentation
Resolution Staff Memo
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 Paragon Square Urban Revitalization Area
District
DATE: January 12, 2016
Housing and Community Development Department Director Alvin Nash requests the
City Council approve a resolution directing the Paragon Square 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.
Mic ael 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 Paragon Square Urban Revitalization Area
District
Introduction
This memorandum presents for City Council a petition for Urban Revitalization Area
Designation from Frantz Community Investors. The memorandum recommends the City
Council review and approve the attached resolution to set a public hearing for Paragon
Square 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 affordable senior housing development plan proposes to create 29 affordable senior
apartments that include 3 efficiency units, 8 one-bedroom units and 18 two-bedroom units.
The project will restore both buildings on the proposed parcels to their original historic
significance. The planned development site is located at 2887-2901 Central Avenue. The
project will utilize multiple sources of funding including Low Income Housing Tax Credits,
Federal Historic Tax Credits, State Historic Tax Credits, Workforce Housing Tax Credits,
Developer Equity, Permanent First Mortgage, and Abatement Mortgage. Contingent upon
an award of Low Income Housing Tax Credits, the City of Dubuque will contribute $65,000
in Downtown Rehabilitation Grants and Urban Housing Incentive funds, consistent with
incentives provided to other downtown projects. The urban revitalization tax exemption
will show local support for the project, which will strengthen Frantz Community Investors
Tax Credit application to the Iowa Finance Authority.
The area is established under 404.1 (3) and is defined as an area in which there is a
predominance of buildings or improvements which by reason of age, history, architecture
or significance should be preserved or restored to productive use. The basis 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. Frantz
Community Investors 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 June 6, 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 April 20th
meeting.
Budgetary Impact
The property value, based upon 2015 Beacon data, is $27,560 for land and $14,440 for
dwelling for a total taxable value of$42,000 for the property at 2887 Central Avenue. The
property value is $55,100 for land and $47,000 for dwelling for a total taxable value of
$102,110 for 2901 Central Avenue. Dubuque City Assessor Rick Engelken the ten year
abatement will provide $196,450 to support the project. The ten year abatement is
consistent with other affordable senior housing projects being submitted from Dubuque.
Recommendation
I recommend that the City Council approve the attached resolution directing the Paragon
Square 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\Petiti on s for Districts\Paragon Square 2016\Memo to CoundI.doc
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RESOLUTION NO. 20-16
RESOLUTION FINDING THAT THE DESIGNATION OF THE PARAGON SQUARE
URBAN REVITALIZATION PLAN IS NECESSARY FOR REHABILITATION AND
CONSERVATION OF THE HERINAFTER DESCRIBED PROPERTY AND URBAN
REVITALIZATION AREA IS NECESSARY IN THE INTERESTS OF THE PUBLIC
HEALTH, SAFETY, AND WELFARE OF THE RESIDENTS OF THE CITY
Whereas, the City Council of the City of Dubuque finds that the properties at 2887 -
2901 Central Avenue (Property) are currently vacant and underutilized, and Frantz
Community Investors has proposed to rehabilitate the Property and create 29
apartments and restore both buildings on the proposed parcels to their original historic
significance; and
Whereas, the City supports Economic Development, Historic Preservation, and
promotes Affordable Housing to benefit the citizens of Dubuque; and
Whereas, the Property is located in an area eligible for the Urban Revitalization Tax
Exemption program; and
Whereas, in the area proposed for designation under the Urban Revitalization Act
there is a predominance of buildings or improvements which by reason of age, history,
architecture or significance should be preserved or restored to productive use as
defined by Section 404.1(3) of the Iowa Code; and
Whereas, through the Urban Revitalization Program, the Property is eligible to
receive a one hundred percent exemption from taxation on the actual value added by
the improvements for a period of ten years so long as it is assessed as residential
property 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.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the rehabilitation of the Property legally described as
2887 Central Avenue — Lot 2 — I Paragon Square, Dubuque Iowa
2901 Central Avenue — Lot 1 — I Paragon Square, Dubuque Iowa, according to
the recorded plat thereof.
is deemed necessary in the interest the residents of the City.
Section 2. That the City Council supports Frantz Community Investors' Petition that
2887 - 2901 Central Avenue be designated a Urban Revitalization Area and supports
the developer's efforts to receive a tax credit award from the Iowa Finance Authority for
this Development.
Section 3. That the City Council approve the resolution supporting he project and
authorize staff to work with the City Assessor to complete the form 5S for submission by
Developer prior to December 7, 2015 deadline for consideration.
Section 4. That the proposed Development is consistent with the City of Dubuque's
affordable housing strategies and its goal to implement its comprehensive plan.
Section 5. That the City is authorized and directed to submit the Paragon Square
Urban Revitalization Area Plan to the City's Long Range Planning Advisory Commission
for review and comment.
Section 6. That the City Clerk is directed to publish notice of a public hearing on the
Paragon Square 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.
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.
Attest:
Kevi
Firnstah uixy Clerk
RiW. Jones/', ayor Pro -Tem
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 PARAGON SQUARE
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 Paragon Square (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
2887 Central Avenue — Lot 2 — I Paragon Square, Dubuque, Iowa
2901 Central Avenue — Lot 1 —1 Paragon Square, Dubuque, Iowa, according to
the recorded plat thereof.
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 S. Firnstahl, City Clerk of Dubuque, Iowa
1t 2/19
Paragon Square Revitalization Plan
For Public Review until March 7, 2016
Contents
Introduction.........................................................................................................................................2
TheArea ...............................................................................................................................................3
Availabilityof Funding......................................................................................................................4
RevenueBonds ..................................................................................................................................5
Relocation............................................................................................................................................5
Qualificationof Areas.......................................................................................................................5
HistoricSignificance.........................................................................................................................6
BuildingConditions...........................................................................................................................6
RevitalizationProgram .....................................................................................................................6
ApplicationProcedure......................................................................................................................s
Conclusion...........................................................................................................................................9
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PARAGON SQUARE 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 Paragon Square 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 Paragon Square Urban Revitalization Plan will be based upon the
predominance of buildings or improvements which by reason of age, history,
architecture or significance should be preserved or restored to productive use as
defined by Section 404.1(3).
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The Area
Location
The area included in the Paragon Square Urban Revitalization district is
located at 2887 and 2901 Central Avenue in the City of Dubuque, Iowa,
legally described as:
Lot 1 of 1 and Lot 2 of 1 of Paragon Square, all in the City of Dubuque,
Dubuque County, Iowa.
A map of the area boundaries is attached as Exhibit A.
Zoning
The existing zoning is OR (Office Residential District). Exhibit B shows the
existing zoning districts. 2887 Central Avenue was rezoned in 1994 and
2901 Central was rezoned on January 18, 2011 by Ordinance No. 4-11 .
The Zoning Board of Adjustment approved a variance on December 16,
2010 to allow the former convent building at 2887 Central to be converted to
ten residential units with a deficit of 5 off-street parking spaces (Docket 62-
10) and on an 8,490 square foot lot where 12,000 square feet of lot areas
was required (Docket 63-10).
The Zoning Board of Adjustment approved a special exception on February
24, 2011 to allow the former Holy Ghost Assisi School building at 2901
Central to be converted to 18 residential units on an 18,256 square foot lot
where 21 ,600 square feet of lot area is required (Docket 10-11) and with a
deficit of 4 off-street parking spaces(Docket 11-11).
Existing and Proposed Land Use
The Paragon Square Urban Revitalization District is comprised of two
existing structures on two lots. Total acreage is .614 acres (26,746 square
feet).
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2887 Central contains the former Holy Ghost convent building, a three story
masonry building which is currently vacant.
2901 Central contains the former Holy Ghost Assisi School building, a four-
story masonry building, which is currently vacant.
Both buildings are currently qualified for the National Register of Historic
Places. The project proposes to create 29 apartments that include 3
efficiency units, 8 one-bedroom units and 18 two-bedroom units. The project
will restore both of the buildings on the proposed parcels to their original
historical significance.
Exhibit C identifies the existing primary land use for the proposed district.
Assessed Valuations and Owners of Records
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
Funding sources for the redevelopment will include Low Income Housing Tax
Credits, Federal Historic Tax Credits, State Historic Tax Credits, Workforce
Housing Tax Credits, developer equity, permanent first mortgage, and abatement
mortgage. Contingent upon an award of Low Income Housing Tax Credits in
2016, the City will contribute $35,000 Downtown Rehabilitation Grants (fagade,
design, financial consultant) and $30,000 Urban Housing Incentive. The
designation of the Urban Revitalization Area will assist to make the project
financially feasible.
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Revenue Bonds
There are no plans to issue revenue bonds for revitalization projects in this
area.
Relocation
No relocation is expected due to rehabilitation of the parcels identified for this
district since the buildings are 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.
Qualification of Areas
The Paragon Square Urban Revitalization District Area is an area comprised
of 2 parcels and two existing historic buildings. The buildings were formerly
used for a school and convent on the Holy Ghost Catholic Parish campus at
29th and Central Avenue. The area is adjoined on the west and south by the
Holy Ghost parking lot, on the north by the Holy Ghost rectory, church and
existing school and on the east by Central Avenue.
Historically, buildings associated with a church campus are difficult to
adaptively reuse. These buildings typically sit vacant for long periods of time,
due to the size and limitations for these large structures. The revitalization
and reuse of these currently vacant buildings will prevent deterioration of the
structures and the negative impact on the neighborhood that often results
from blighted properties.
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Historic Significance
The Paragon Square Urban Revitalization Area contains historic structures
that are worthy of preservation. In an effort to stem the deterioration of these
buildings, it's appropriate that this area be designated as an urban
revitalization area. The plan seeks to preserve and renovate the area's
existing buildings into functional residential housing units.
The Holy Ghost Assisi School building (2901 Central) was initially constructed
in 1896 as a combination school-church-convent building. The former Sisters
Convent of Holy Ghost (2887 Central) was then built in 1903. When the Holy
Ghost Catholic Church was completed in 1917, the original combination
building was remodeled for use only as a school. The three story brick school
building exhibits Romanesque Revival style features with some Gothic
Revival elements.
The convent building has some details reflective of the Romanesque and
Gothic revival designs while including other general details of the late
Victorian period. The convent reflects the brick architecture and details of the
adjoining school, church and rectory buildings and contributes to the
architectural significance of the overall historic district. The architectural styles
and the use of red brick visually link the Holy Ghost buildings.
Building Conditions
The City Assessor's office has classified the condition of the buildings as very
poor. The structures are in need of repair and rehabilitation to preserve their
historic features and character.
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
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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
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 'improvements', which
include rehabilitation and additions to the existing structures. "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.
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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 area shall become a Revitalization District commencing upon the
adoption of the ordinance approving this Revitalization District by the City
Council. The designation of the Paragon Square Urban Revitalization
Plan Area will remain in effect until the desired level of revitalization has
been attained, or for five (5) years, whichever occurs first. Upon repeal of
the ordinance establishing this revitalization area, all existing exemptions
would continue until their previously established expiration date.
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
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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
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. The project will assist the rehabilitation efforts
of vacant or deteriorating properties by providing needed housing units and
supporting reuse of existing structures for the citizens of Dubuque. After the
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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\Paragon Square 2016\Paragon Square UR Plan.docx
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