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HomeMy WebLinkAbout08-13-2010 Council Economic Development Committee AGENDA City of Iowa City City Council Economic Development Committee Friday, August 13,2010 7:30 a.m. City Manager's Conference Room City Hall 1. Call to Order 2. Consider approval of the June 15, 2010 Economic Development Committee meeting minutes 3. Consider a recommendation on an amendment to an Agreement for Private Development between City of Iowa City and Moss Green Development Corporation 4. Consider request from Iowa City Area Development Group for one year extension of 5-year funding agreement 5. Update on Economic Development Activities 6. Staff time 7. Committee time 8. Adjournment MINUTES CITY COUNCIL ECONOMIC DEVELOPMENT COMMITTEE JUNE 15, 2010 LOBBY CONFERENCE ROOM, 8:00 A.M. PRELIMINARY Members Present: Staff Present: Others Present: Regenia Bailey, Matt Hayek, Susan Mims Wendy Ford, Tracy Hightshoe, Jeff Davidson Nancy Quellhorst, Andre Perry, Englert Theatre Board of Directors, Gigi Wood RECOMMENDATIONS TO CITY COUNCIL: It was moved by Mims and seconded by Hayek to recommend approval of the contract with the National Development Council regarding community and economic development advisement. Motion carried unanimously. 1. CALL MEETING TO ORDER: The meeting was called to order by Chairperson Bailey at 8:01 A.M. Bailey had all persons present introduce themselves. 2. CONSIDER APPROVAL OF THE MINUTES OF THE MAY 25,2010, ECONOMIC DEVELOPMENT COMMITTEE MEETING: It was moved by Hayek and seconded by Mims to approve the meeting minutes of May 25,2010. Motion carried unanimously. 3. ANNUAL REPORT AND REVIEW OF ENGLERT THEATRE OPERATIONS FOR YEAR TWO OF THREE-YEAR FUNDING AGREEMENT APPROVED IN DECEMBER 2008 Ford reviewed the 2009 performance measures submitted by the Englert Theatre. Ford stated the review of performance measures was part of the annual $50,000 funding of the Englert by the City. Andre Perry, Englert Theatre Executive Director, was present and reviewed the current financial report of the Englert Theatre. Perry stated the Englert was still a cultural landmark in Iowa City and that the financial condition was improving. Perry stated year- to-date revenue was ahead of 2009 and that cash flow had improved. Perry stated that summer programming was soft, creating cash flow issues during the summer. Perry reviewed the current financial report, debt/cash flow projection, three-year financial report, ticket sales statistics and demographics, the Englert Theatre in the greater marketplace, donor relations, and future plans. Perry reaffirmed the Englert's dedication to local and regional performing arts. Perry stated they would be exploring more uses of the Englert as a film venue. Hayek stated he was seeing continued improvement in the Englert Theatre and felt that they had top-shelf leadership. Bailey asked if there were other performance metrics to look at. Bailey stated she felt the Englert was a centerpiece of downtown and that it must be successful for the downtown to be successful. Englert Board member Mark Nolte stated that the City was a great partner of the Englert's. Nolte stated that anything the 1 Economic Development Committee Meeting June 15, 2010 City could do to assist the downtown would indirectly assist the Eflglert. Mims stated that with the 21-only alcohol ordinance going into effect there would be students with disposable income looking for late night activities, and could some of those activities be at the Englert? Hayek stated that the University wants additional late night programming developed to keep students out of bars and that the timing was perfect. Davidson stated that no official action from the Economic Development Committee was necessary. Davidson stated that the Englert had requested $50,000 FY11 City funding to be issued in July to assist with cash flow issues and that subject to additional input from EDC, staff would process the Englert's check in July. There was no further discussion. 4. CONSIDER CONTRACT WITH NATIONAL DEVELOPMENT COUNCIL REGARDING COMMUNITY AND ECONOMIC DEVELOPMENT ADVISEMENT: Hightshoe reviewed the proposed agreement with National Development Council (NDC). Hightshoe stated that the City was working with property owners and developers in Riverfront Crossings and Towncrest redevelopment areas to revitalize the neighborhoods and ultimately increase property values. Hightshoe stated that NDC could provide assistance in the coordination of diverse interests and financial resources. Hightshoe explained the qualifications of NDC. Hightshoe stated she had checked out NDC's qualifications with several cities that already have NDC under contract. Hightshoe stated NDC would assist the City in working with existing property owners and developers to package financing to enable projects to proceed. Davidson stated that it was necessary to tap into the knowledge that NDC could provide in packaging redevelopment deals, as well as utilize them so that development projects could be pursued in a timely manner. Davidson stated that it was possible for the funding provided by the City to NDC to be reimbursed through other grant sources. Davidson stated that the hiring of NDC was the next logical step in terms of the Towncrest redevelopment process. Davidson stated that an analysis to determine the costs and financial feasibility of various redevelopment project areas had recently been completed by Eppink Consultants and that this information would be provided to NDC. Hayek asked about the involvement of ICAD and the Chamber of Commerce packaging deals. Davidson replied that ICAD dealt principally with interstate commerce type businesses. Davidson stated ICAD did not work with the types of local businesses found in Towncrest. Davidson stated the Chamber of Commerce was a good partner of the City's, but would not be packaging individual redevelopment deals. Nancy Quellhorst, Chamber of Commerce Executive Director, stated that the Chamber was enthusiastic about the Towncrest redevelopment area, but would not be brokering individual deals. Mims stated she was concerned about finding funding for the NDC contract. Davidson stated the one-year contract was structured on a monthly basis and could be terminated on 30 days written notice. Davidson stated that funding would be provided through seed money the City Council had provided in the FY11-12 budget. Bailey stated she felt the NDC contract was needed to help move things along in Towncrest. Hightshoe stated timing of the NDC contract was good and that CDBG economic development money could possibly be used for future projects. It was moved by Mims and seconded by Hayek to recommend approval to the City Council. Hayek stated he had come into the meeting skeptical, but had his mind changed after hearing more about the proposal. The motional carried unanimously. Economic Development Committee Meeting June 15, 2010 5. STAFF TIME: No report. 6. COMMITTEE TIME: No report. 7. ADJOURNMENT: Bailey stated the next EDC meeting was tentatively scheduled for 8:00 a.m. on Monday, July 12. Ford stated the meeting would be cancelled if there were no pertinent agenda items. Bailey declared the meeting adjourned at 8:51 a.m. Economic Development Committee Meeting June 15, 2010 Council Economic Development Committee ATTENDANCE RECORD 2010 TERM ...... w w ~ 01 0> EXP. - - - - - - NAME N N ...... N N ~ 0 0) 0 01 01 Regenia 01/02/11 X X X X X X Bailev Matt 01/02/11 X X X X X X Havek Susan 01/02/11 X X X X X X Mims Key: X = Present o = Absent DIE = Absent/Excused ,~ 1 ~~~_4... ~~~~~ ~~..-., -.. - CITY OF IOWA CITY MEMORANDUM Date: August 2, 2010 To: Economic Development Committee ><< Re: Jeff Davidson, Director; Department of Planning and/7J~unity Development Wendy Ford, Economic Development Coordinator ~ Agenda Item 3: Consider a recommendation on an amendment to an agreement for private development between the City of Iowa City and Moss Green Development Corporation From: At your June 15, 2010 meeting, you approved on a 2-1 vote (Bailey voting no) a recommendation to the City Council to approve the proposed Moss Green Urban Village TIF Development Agreement. This agreement is on the City Council's meeting agenda but has been deferred indefinitely pending environmental clearances which need to be received from the U.S. Army Corps of Engineers. We have been contacted by the Moss Green project developer and asked to consider an amendment to the development agreement. The developer would like to increase the not-to- exceed expense from $13.7 million to $15.3 million. The developer has stated the following factors: . Adjustment of the construction cost estimate based on using local contractors and suppliers. . The increase in the expense to engineer and construct the project because of requirements mandated by the U.S. Corps of Engineers for wetland mitigation and consideration of environmental features on the site. At your August 5 meeting we will walk through the specific cost factors leading to the request to increase the expense estimate from $13.7 million to $15.3 million. To clarify, the only change being requested is in the not-to-exceed amount which would be refunded to the developer through the TIF agreement. The total economic development grants paid to the developer would continue to be the lesser of: a. 20 years of 50% of the tax increment collected; or b. The actual cost of the minimum improvements; or c. $15.3 million instead of $13.7 million Please be prepared to consider a recommendation on this amendment at your August 5 meeting. ppdadmlmem/ecodev821 Oitem. doc ,~ 1 ~~'5._~~ ~~~j!:~ ~~__aa.' ~. --- CITY OF IOWA CITY MEMORANDUM From: August 2, 2010 City Council Economic Development Committee Wendy Ford ICAD funding request Date: To: Re: In March of 2006, the City of Iowa City entered into an Investment Commitment with the Iowa City Area Development Group (ICAD) agreeing to provide $100,000 per year for the five fiscal years ending 2007 through 2011. The $100,000 level was an increase from what had been $50,000 for previous fiscal years ending 1991 through 2006. ICAD leadership anticipated commencing a new campaign earlier this year, however, due to continued strained economic conditions and other regional funding campaigns, decided to request one year extensions of their prior investment commitments. Staff recommends that the one year extension be granted. Joe Raso, President of the Iowa City Area Development Group will be in attendance at your meeting on August 5th to discuss the request outlined in the following letter and to answer your questions. 325 East Washington Street, Suite 100 I Iowa City, IA 52240-2567 I 319-354-3939 I FAX: 319-338-9958 I www.lowaCityAreaDevelopment.com ____ ___._...____ _____._ n___.____._._____ '_____n__....___"'___ -.---- --------- Iowa City Area Development Group July 13, 2010 Dale Helling City of Iowa City 410 East Washington Street Iowa City, IA 52240-1825 As an Iowa City Area Development Group board member, we need your help in continuing our Creating Advantage Investing For Results campaign for one more year. By extending your annual pledge of $100,000 through FY2012, you further the vision of this organization to create and grow companies, wealth and quality jobs in the Iowa City area. Since the beginning of this campaign, ICAD Group has provided significant assistance with 29 projects, totaling more than $192 million in new capital investment. We have helped new and existing companies create/retain more than 2,650 jobs with total earnings of nearly $110 million annually. Our recent strategic planning session produced an aggressive and pioneering course of action to guide ICAD Group into its third decade. This innovative model of regional development requires: . new, in-depth industry sector research in five strategic areas . further exploration on creating a unique space where ideas can be shared and knowledge transformed into economic opportunity . ongoing enhancements to our proactive development programming including our Certified Shovel Ready Sites Program and workforce initiatives Please complete and return the enclosed pledge form by July 30, 2010, acknowledging City of Iowa City's investment in the continued growth of the Iowa City area. Thank you for being such an important influence on our past success. We value your partnership and investment in our organization and your commitment to enhancing the economic vitality of our region through your support of the Iowa City Area Development Group. Sincerely, ScJr K' ~ ""... ~ '- -'. " " (,--"'<'~ ~ . \ ''-'~'----.-J Joe Raso, President Iowa City Area Development Group Scott Fisher, Chair Iowa City Area Development Group l ~ 1 -=:.'3....liO'.... ~~C'2Vi!:~ ~~-_.~ ~-- CITY OF IOWA CITY MEMORANDUM Date: July 30,2010 To: City Council Economic Development Committee r1f From: Jeff Davidson, Director of Planning & Community Development Re: Economic Development Project Update Ongoing discussions with our partners in the development community indicate that access to financing for development projects remains difficult. Although we are encouraged by positive indicators showing general economic recovery, lending for commercial and residential projects in our local economy continues to be tight. In this economic climate it is important for public sector investment in economic activities to be done carefully and shrewdly, but it is imperative that it occur. As is indicated in the information which follows, in this economic climate the public sector has the ability to use public money to stimulate private investment. Following is an update of ongoing economic development activities that the City of Iowa City is involved in. These eight projects are highlighted because of their ability to have substantial impact on our local property tax base. 1. Expansion of Southeast Industrial Park After working through several environmental issues on our new 173-acre industrial property, we are ready to take the preliminary plat to the Planning and Zoning Commission. When the platting has been approved by the City Council we will have the ability to sell individual building lots for industrial development. The delay in platting the property has not curtailed our marketing efforts. Our partners at ICAD continue to provide information packets to interested parties, in particular to the wind power industry. The global economic malaise has significantly impacted the wind power industry. ICAD is in contact with several wind power related companies that are evaluating location decisions. They have also provided information to general industrial prospects. We are currently completing an application to the Iowa Department of Transportation for a grant which would assist us in constructing the rail infrastructure for the industrial park. We are also putting the finishing touches on the shovel-ready site certification which we hope to achieve shortly. This certification will streamline the process by which interested companies contact the state of Iowa or ICAD and proceed through their evaluation process. 2. Moss Green Urban Village In June the formal groundbreaking was held for the Moss Green Urban Village development project. This project will create an office research park with a mix of uses on property west of Pearson in northeast Iowa City. This project is currently awaiting sign-offs by the U.S. Army Corps of Engineers on wetland and environmental issues which are required before we can proceed with the necessary approvals from the City. Once approvals have been secured from the Corps and a revised plat and wetland mitigation plan have been reviewed by the Planning July 30,2010 Page 2 and Zoning Commission, the final reading of the rezoning for the property, the preliminary plat, and the resolution authorizing the development agreement which will enable TIF rebates to be used to reimburse the developer for infrastructure improvements will be forwarded for the City Council's consideration and approval. The developer is actively marketing the project and has indicated a great deal of interest in the property. 3. Single Family Residence New Construction Program This project is not in itself an economic development initiative, but it has a significant impact on our local property tax base. You are aware that the focus of our flood mitigation effort has been on the buyout of properties which are located in flood hazard areas along the Iowa River. This has resulted in the ongoing acquisition and demolition of approximately 94 residential properties. This is approximately $23 million in residential taxable value. We are fortunate that the state has established a replacement housing program to supplant our lost residential taxable value from buyouts. The initial round of the program granted us funds for 40 single-family homes. These homes have been constructed in non-flood hazard areas throughout Iowa City, and most are presently occupied. We have received approval for an additional 37 single-family residential units in the second round of funding. Construction of these homes is just commencing. The state has indicated that there is likely to be one or two more rounds of funding and that we are a good candidate for at least the remaining 11 units. Hopefully, we can exceed 94 new residential units by the time the program is completed. It is great news that we have been able to replace the property tax base of the bought-out homes and provide new housing stock in non-flood hazard areas throughout Iowa City. 4. Music School/Hieronymus Square The University of Iowa is expected to go to the State Board of Regents in August and announce that property acquisition issues have been resolved for the new Music School/Clapp Recital Hall/Hieronymus Square multi-use development project. Although the University's construction of the Music School and Clapp Recital Hall facilities will not be property tax producing, it will spur the construction of the Hieronymus Square multi-use development project on Block 102 adjacent to the Court Street Transportation Center. We anticipate that the entire multi-use project will create new commercial and residential property tax generation approximately equal to what was envisioned for the original stand-alone Hieronymus Square project. The City has a substantial role in this project in terms of providing two needed parcels of property, an agreement for parking in the Court Street Transportation Center, and the possible use of TIF property tax rebates to facilitate construction of the non- University portion of the project. This project is consistent with the City Council's desire to expand arts and entertainment venues in downtown Iowa City. 5. Downtown Business Incubator We have completed the Downtown Business Incubator Feasibility Study which was funded through a $60,000 grant from the Economic Development Administration. We are expecting to receive the final report from the consultant within the next few weeks. The report lays out a roadmap for construction of a co-work type downtown business incubator which would provide business incubator services in a niche not currently provided by the existing business incubators July 30, 2010 Page 3 in the community. Potential sites have been identified with the associated cost figures and possible revenue streams for getting up and running. We will bring a proposal to the City Council for moving forward during FY12 budget discussions. 6. Multi-use Parking Facility on former St. Patrick's Parish Hall Property We remain in the negotiating stage with two private sector partners who have expressed interest in locating in our proposed facility. These are multi-million dollar location decisions, so they involve great deliberation. We have also been awaiting the University's announcement regarding the Music School/Hieronymus Square project, which is approximately 1'V2 blocks from our site. We are prepared to commence design and engineering services this fall with construction starting during calendar year 2011. Our goal is to create at least 30,000-60,000 square feet of taxable commercial or residential space on a property which has not generated property taxes since at least the 1920s. Additionally, we expect 600 new parking spaces to be a catalyst for further private development in the area. 7. Towncrest Our Towncrest redevelopment initiative continues to move ahead. We are focused on getting the overall master redevelopment plan and streetscape design plan prepared. We want to be ready for private investment once the economy improves. We are currently establishing an urban renewal area which would allow the use of TIF funds for reinvestment in the area. We have recently completed a business development analysis which outlines several catalyst projects for spurring redevelopment in the area. The general redevelopment model for Towncrest involves higher density development than exists currently. There will be a mix of residential, office, and commercial retail uses. We have recently entered into two contractual arrangements: one is with RDG Associates for completion of a streetscape design plan for the area. We commenced a public input process for the streetscape plan on July 28, which was well attended by businesses and residents of the area. This plan will lay out the City's intentions for the public realm and building facades in the area. We have also entered into a contractual arrangement with the National Development Council. Their work will begin August 2 and will involve coalescing developers, property owners, and lenders to enable specific redevelopment projects to move forward. We may also have some public projects that would be funded by the City for your consideration in the upcoming FY12 CIP process. 8. Riverfront Crossings We are currently entering into our second contractual arrangement with the Environmental Protection Agency for consultant services related to the Riverfront Crossings initiative. This second planning grant will enable us to do a more specific design plan for a Riverfront Crossings subarea. We also have several other initiatives for the Riverfront Crossings area: . Design and engineering is proceeding on relocation of the North Wastewater Treatment Plant. This will eventually include cleanup and redevelopment of the resulting brownfield site. July 30, 2010 Page 4 . Johnson County is preparing to demolish the old National Guard Armory. Specific plans for the property have not been developed. but there are a couple of interesting ideas out there. . We are working with the Iowa Department of Transportation and the Chamber of Commerce on the application for grant funds which would enable Amtrak service to be extended between Chicago and Iowa City. I attended a meeting with Amtrak in Chicago on July 22 on adaptive re-use of our old railroad station for the proposed service. . We have submitted a TIGER II / HUD Community Challenge grant for the Riverfront Crossings - River Landing Passenger Rail Corridor Land Use Plan. This is a joint project with Coralville and the University of Iowa which would create a more specific land use plan for the area along the planned light rail transit service line. Please bring any questions to the August 5 EDC meeting. cc: City Council Dale Helling Wendy Ford ppdadm/mem/ecodevcomm 72810 .doc ~ , 'I / ., I , \ 'E)\I/' .,... I ~ - hi" \, I { t, 1'111 '",I ' , \,I,i (' i i \.. \ ., I) il i\ :! i\ I il I, :1 r II rt ,,"J; /1 /1 -j' - ., - -,~ r 1) Lr~~ _'~' II Ii Ii [l,""JJ ,~~'. /:7~ '^ . Tl ) l_.._ I' L~ ,II ,II 1 'I I ""'""""~ !I t.! a \1 :1 II i: " Ii il Ii )1 'I :1 Ii !I ''''~<.~, .....c"'. ~1I1 , I' i- L.:~.' - :./,,1 I I \, ~~, \~ \\ r '~J '\ ;c~ ~ I, r ~ '0 <1l U. Cl C :g <1l a. Q) III ~ :;:l :; ::E ~ <1l a. (ij :s III :J 'tJ .E w rn - o c o 'iij C <1l a. Jl u; l!! o c ~ o I- on CQ ,... 101 ~ <1l :J tT rn III :J o ~ c ~ Q) J: .... .a Q) ..Cl Cl G ~ ..s: ;;; III ~ c: ~ c: co c: "en :5 '~ e c lD U ~ ~ ~ III C Q) > III ~ > ~ ~ 8 0:: D~Di CI) ..... ca "'C C. ::) ..... 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