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HomeMy WebLinkAbout04-22-2008 Council Economic Development CommitteeAGENDA City of Iowa City City Council Economic Development Committee Tuesday, Aril 22, 2008 8:00 a.m. Lobby Conference Room Iowa City City Hall 1. Call to Order 2. Consider approval of the minutes of the March 26 and March 27, 2008 Economic Development Committee Meetings 3. Discussion of CDBG Economic Development Funds Applications a. Textures Salon b. Alfie's Beauty Supply 4. Consider proposal from Sheraton Hotel a. Parking Agreement Amendment b. Financial Assistance c. Vacation of Public Easement 5. Towncrest Area update 6. Staff time 7. Committee time 8. Adjournment draft MINUTES CITY COUNCIL ECONOMIC DEVELOPMENT COMMITTEE MARCH 26, 2008 CITY HALL, LARGE CONFERENCE ROOM, 7:30 A.M. Members Present: Regenia Bailey, Connie Champion, Matt Hayek Staff Present: Wendy Ford, Jeff Davidson Others Present: Nancy Quellhorst, Craig Gustaveson, Josh Schamberger, Doug Neumann And many members of the business community. CREATING A DOWNTOWN VISION (public meetin Nancy Quellhorst welcomed the group. Craig Gustaveson then spoke briefly about how the Market Niche Analysis study came to be and that it was a joint effort between the Chamber of Commerce and the City to commission a study of the downtown area. He explained that the study began last May and has led to the finished Market Niche Analysis that was presented in November, 2007. Josh Schamberger from the CVB then spoke to the group briefly. He noted that the study is on- line, for those who have not had a chance to review it, and there is an Executive Summary there, as well. Schamberger noted that the group present has been asked to come together so a decision can be made as to what needs to be done downtown, if anything. He noted that a Strategic Plan might need to be created in order to plan the vision for the downtown area. He noted that this effort should come from the private sector, not the City, with public sector support from agencies like the Chamber of Commerce and the Convention and Visitors Bureau. Schamberger then introduced Doug Neumann to the group. Doug Neumann addressed the group next. He noted that things are going well in downtown Cedar Rapids currently. He noted that they are trying to better promote the fact that Cedar Rapids has a strong restaurant district, with 37 eating establishments in the downtown area. Neumann noted that the commercial occupancy rates are up in Cedar Rapids' downtown, and that the past few years have seen an decrease in office space vacancy. He noted also that for the first time in about 12 years, they have property owners and developers looking at underdeveloped and underutilized properties in the downtown area, discussing possible projects. Neumann also noted a strong arts and culture district in downtown Cedar Rapids, as well, noting that a number of non -profits in the area are doing quite well. Neumann then spoke to the group about the Farmers' Market in downtown Cedar Rapids, stating that they are expecting 10,000 to 12,000 people at each event, and that they have expanded to 150 vendors with a waiting list of 150 more vendors who want to be a part of the Farmers' Market. Neumann noted that the Cedar Rapids downtown still needs to work on their retail and housing areas, but that they are proud of their accomplishments over the past few years. Neumann talked about how Cedar Rapids has done their Business Improvement District. He spoke about the Self -Supporting Municipal Improvement District (SSMID), stating that they started this in Cedar Rapids in 1986. He noted that originally this was set up as a 20-year district self -taxed at $3.00 per $1,000 valuation. The singular focus at that time was streetscape, such as the benches, brickwork, and other aesthetics in the downtown area. In the late 80's, Neumann stated that a small operating organization began, mainly to do some marketing and promotion of the downtown area. This organization has grown slowly over time, according to Neumann. When the 20-year period was about to expire, Neumann stated that many of the downtown business leaders got together to discuss what they wanted to happen next. At that time, a decision was made to shift to a more economic development type of organization. Neumann noted that at that time a decision was made also to expand the district by several blocks, leaping Economic Development Committee Meeting March 26, 2008 over to the west side of the river, which was renewed for another 10 years at $2.75 per $1,000 of valuation. Neumann continued, noting the importance of a vision for the downtown development. Neumann noted that some of Cedar Rapids' failures have come from a lack of vision, and he noted how important this truly is. In the fall of 2006, Neumann stated that a meeting of the City, the County, the Chamber, and the Downtown District took place. They created a plan at this meeting, and Neumann noted that the big difference this time around was that everyone was together on the issues. He stated that the plan focused greatly on implementation, not creating new ideas. Thirdly, Neumann stated that they have tried to keep their vision front and center, so that their plan does not become forgotten. Neumann then addressed the question of what would happen without a plan or a district in place. He noted that the financial resources raised by the SSMID are very important, as is the leverage of having the District approach the City for help in projects. He noted that in Cedar Rapids they would not have the streetscape that they do downtown if they had not had the SSMID in place. Neumann then opened up the discussion to questions. Ford asked him to describe what was happening in 1986 before the formal organization formed, as far as downtown initiatives. He replied that this was before his time, but that in reviewing the history he sees a lot of self-interest, in that business owners had to look out for their own interests. He also noted that at one time there were also a lot less decision -makers, that it was a very small circle of people making the decisions for the whole. Jeff Davidson then spoke about positions such as Neumann's and how they are compared to "mall manager" positions, asking Neumann to address some of these myths. He noted that people believe that this position would control how vacant spaces are filled, hours of store operation, etc. Neumann stated that he does none of those things in his position, and he further explained what he and his staff do for the Downtown District. He stated that he is a communicator and advocate for the downtown, and that there are other resources for that type of thing. Neumann explained how he and his staff attempt to communicate with businesses, such as letting them know when big events are taking place at the Cellular Center so that the businesses can change or add hours and/or staff in order to meet increased demands. Neumann was next asked about the Cedar Rapids SSMID, asking if he would structure it differently. He noted again that he was not part of that original process, but that he is sure there are some lessons to be learned from it. He noted that there were some mistakes made and some hard feelings, as well, but that the effort was to have volunteers work on this. He noted some of the difficulties encountered, stating that on the whole the process works very well. The questions turned to what type of resources would be needed to start something like this for approximately three years. Neumann stated that this would be a hard question to answer, as he does not know the dynamics of Iowa City's downtown. He stated that having a singular focus makes it easier to bring a group together and have them be united. He noted that this is a decision the group will need to make, to either have a narrower focus, or to have a more dynamic organization to begin with. Neumann was then asked to make a side -by -side comparison of Cedar Rapids' accomplishments and challenges currently, and where he sees downtown Iowa City. As an example, housing and retail development was noted. Neumann responded that, again, he is not as familiar with Iowa City's issues. He noted that Cedar Rapids' downtown is a "B+ or A=' as far as a "business park." He noted that 13,000 workers come to downtown Cedar Rapids each day to work. He noted that as far as aesthetics and safety, a lot of Iowa cities rank high in this compared to cities in other states. As far as entertainment and culture, Neumann noted that the US Cellular Center is now 29 years old and needs improvements, but that the rest of this district ranks high for Cedar Rapids. He stated that Cedar Rapids has only 900 residents downtown, and that this is an area that needs improvement. He added that Iowa City has done a good job with housing in the downtown area, and that he believes Iowa City is also strong in retail. Economic Development Committee Meeting March 26, 2008 The next question was in regards to budget, as far as how much money would go for management, staff, marketing, etc., and if any City functions are taken over, such as keeping streets clean, having extra police officers, etc. Neumann stated that in Cedar Rapids they discussed what the City's baseline services were, and that due to having some resources available, they wanted to make sure these things were covered. He stated that they put a value on the services that they do perform, and the City does pay them for these services, such as watering the flowers and plants downtown. Neumann added that the District now receives $110,000 annually for these downtown services, but that this did not happen until recently. He further explained how the Downtown District is set up, and how the SSMID funds are distributed. Neumann responded to some miscellaneous questions regarding the SSMID and the evolution of Cedar Rapids' downtown. He also spoke about the public art projects that will be coming this year to the downtown area, noting that they are working with the CVB on these. Neumann responded to further questions about SSMIDs, stating that some further homework would need to be done on the specifics, but he explained how Cedar Rapids developed their SSMID. Gustaveson asked a question regarding the Downtown Association, and if this should be folded into an overall directorship or just what direction Neumann thinks this could go. Neumann stated that it would depend on Iowa City's dynamics and how they want to run this organization. He added that he does believe that downtown development follows the same path in many communities, and that he compares their downtown to upper mid -western communities, not coastal or warm climates. He stated that the same things work everywhere, and the same things fail everywhere, and that by looking at what others are doing, they can see the various formulas that do work. As far as specific details for how Iowa City should set up an organization, Neumann stated that this has to do with the specific dynamics of Iowa City. A question was asked about how to sell these ideas to businesses, and Neumann stated that you have to sell these ideas based on a plan. He gave the example of how Rockwell Collins and Aegon in downtown Cedar Rapids are excited about housing development and riverfront development as they can see the benefits to their companies. Ford thanked everyone who attended, and asked if anyone would be interested in discussing ways Iowa City could move forward, or if they would be interested in doing nothing at all. By a show of hands, she noted that a majority of those present would like to meet again to discuss this. Davidson added that the City has been providing many of these initiatives, and that it is time now for the private sector to start providing them, as well. He noted that it needs to be a partnership between public and private sectors, as well as a partnership with the University. Ford added that she would offer to be the contact person for questions, comments, ideas regarding this, and she shared her email address with those present. She stated that she would like to have everyone's contact information and that they will move forward with more discussions. NEXT MEETING: Scheduled for March 27, 2008 at 8:00 A.M. at City Hall. ADJOURNMENT: Meeting adjourned at 8:20 A.M. Economic Development Committee Meeting March 26, 2008 Council Economic Development Committee ATTENDANCE RECORD 2008 TERM zt N w w NAME EXP. -n 8 M --4 Regenia 01102/10 X X X X Bailey Matt 01102/10 X X X X Hayek Connie 01/02/10 X X X X Champion Key: X = Present O = Absent O/E = Absent/Excused draft MINUTES CITY COUNCIL ECONOMIC DEVELOPMENT COMMITTEE MARCH 27, 2008 CITY HALL, LOBBY CONFERENCE ROOM, 8:00 A.M. Members Present: Regenia Bailey, Connie Champion, Matt Hayek Staff Present: Wendy Ford, Jeff Davidson Others Present: Kevin Digmann, Hodge Construction RECOMMENDATIONS Champion moved to recommend the request for an amendment to the Hieronymus Square Development Agreement; seconded by Hayek. Motion carried 3-0. CALL MEETING TO ORDER: Chairperson Regenia Bailey called the meeting to order at 8:00 A.M. APPROVAL OF MINUTES OF FEBRUARY 19, 2008: Champion moved to approve the minutes of the February 19, 2008 meeting as presented; seconded by Hayek. Motion carried 3-0. CONSIDER A RECOMMENDATION TO THE CITY COUNCIL ON A REQUEST FOR AN AMENDMENT TO THE HIERONYMUS SQUARE DEVELOPMENT AGREEMENT: Ford noted that Members have a copy of her memo regarding the requested extension for the Hieronymus Square project. She reviewed the original agreement that the City entered into with the developer, and briefly explained the need for the extension. She noted that the developer had anticipated being able to break ground by May 1, 2008, with a building that would meet all of the necessary requirements, but due to several factors, including receiving bids that were substantially higher than estimates, the commencement of the project will not occur as originally planned. She stated that the developer has requested more time, and staff has suggested a year, as both the developer and the City still maintain their vision for this project. Ford noted that there are essentially two options — one: to let the date lapse, which would negate all of the time spent thus far on this project; or two: grant an extension to the start and completion dates allowing the developer time to refine design plans. Ford stated that staff is recommending the second option, to grant the extensions, as this project is still believed to be a solid one. Ford added that since this is not City owned land, there is little the City can do to move this along. She stated that staff also believes this extension is a good idea as one of the goals of this project was to increase the property tax base and that a project of this magnitude, even after assisting with TIF would accomplish that goal. She noted that it could net the City approximately $9 million more in property tax revenues over the next 20 years than a typical downtown four story building would. Champion stated that she does not have a problem with the extension being granted. Digmann also spoke to the Committee regarding this request, stating that they really do need to review this project further as they want to be able to make it work, and meet all of the items set forth in the agreement. He briefly explained that they are reviewing some of the inefficiencies in the building, and coming up with the most cost beneficial use of the square footage. He noted that they have been meeting with contractors and going over the design with them to see where costs can be saved. They do hope to be able to break ground yet this summer. Champion stated again that she has no problem with this request, that it is a large project and she understands their concerns. Hayek agreed, stating that they need to support this project as they need more office and commercial space downtown. Economic Development Committee Meeting March 27, 2008 Champion moved to recommend the request for an amendment to the Hieronymus Square Development Agreement; seconded by Hayek. Motion carried 3-0. CONSIDER A RECOMMENDATION TO THE CITY COUNCIL ON A REQUEST FROM BARKALOW AND ASSOCIATES TO FUND A REDEVELOPMENT PLAN FOR TOWNCREST: Ford spoke to the Committee regarding this request, stating that Tracy Barkalow, a local Realtor and partner in redevelopment interests with a property owner in Towncrest, has come forward asking the City if they would be willing to pay $54,000 towards consultant fees to get the Towncrest redevelopment plans going. Ford reminded the Members that back in September they were interested in looking at the idea of redevelopment in the Towncrest area. She noted that staff is recommending that they approach this area as they do other districts in town, where they would involve the community in meetings and by asking questions of the people who live and work in this area about what their likes and dislikes are, and to get their ideas on what would make the area better. She noted that this allows those who use the area, and live in the area, to be a part of the process of renewal. Ford continued, stating that concurrently staff would be developing and Urban Renewal Plan, to incorporate the goals of the City's Comprehensive Plan and ideas from the various planning sessions. She noted that the Committee needs to decide a couple of things — 1) if they would like to put out proposals to consultants, and 2) how or if they would like to consider the cost sharing with Barkalow and Associates, assuming that they will be a partner with the major land owner, Ernie Stopplemoor. Bailey asked Hayek if he had any questions regarding this as he is fairly new to the Committee. He asked how many property owners this involves. Ford stated that it is around 300. Davidson noted that there are 300 properties, and that there could be some duplication of owners in that. Hayek then asked how this works. Davidson responded, giving examples of other projects in the area, and pointing out how in -fill redevelopment can be difficult. He noted that the public part of this process is integral to doing something like this. Davidson added that he would be comfortable with this going ahead, with City Council's direction, as a City -initiated project. He noted that they could propose a different cost sharing on this with Barkalow. Champion noted that this area is really deteriorating and that something needs to be done. Davidson noted that property owners in this area have shown interest in rehabilitation of this area, adding that a lot of things will come out during the public meetings. Hayek asked if they would consider TIF in this area, and Ford answered that the Urban Renewal Plan would allow for TIF, but that the council could choose to award TIF funds however discretionarily they chose. Champion stated that she likes the idea of them financing redevelopment plans alone, so they don't have any perceptions of alliances with developers or property owners to worry about. Members further discussed the public process and getting public opinion on this type of project. Davidson stated that he would like to see the City move on something like this, as the area is in great need. Davidson stated that they will need a recommendation for Council in terms of whether the Committee feels this should be a City -initiated or a cost -sharing project. Hayek stated that it would help him to have more information about what the makeup of ownership is in the Towncrest area. Ford noted that staff is working on this. This led to a discussion of getting property owners interested in this type of redevelopment. Davidson stated that staff will get these numbers to the Committee so they can further review what they would like to recommend. This led to a brief discussion of the timeline for this area, and Davidson responded to Members' questions. Bailey asked that staff get more information for the Committee prior to the next meeting so they can then review further. She noted that Council will want to know what the potential cost ceiling is, and Davidson stated that until they have some input from the neighborhood meetings, they can't really address this. Members continued to discuss the Towncrest area, commenting about whether it should or could remain a medical area, or if some other type of businesses should be entertained. Hayek noted Economic Development Committee Meeting March 27, 2008 that he is not interested in making this a "social services" campus, but Bailey noted that Free Medical Clinic is currently in the Towncrest area, and she does not want to see agencies like that leave. Hayek stated that for years Towncrest was a major medical area, and that he would like to see the area flourish again. Davidson asked what other information, besides property owner information, the Committee would like to have. Hayek stated that a sense of what is there now would be helpful — residential versus commercial, etc. Champion stated that she believes they will get public support for a project like this, just like they did with the Sycamore Mall rehab. STAFF TIME: Ford stated that the sale of the Sheraton went through on Tuesday and Davidson Hotel Company is the new owner now. She stated that they are planning a renovation of approximately $10 million, and that she anticipates that they will be coming to the Economic Development Committee for assistance on some of the improvements. She noted that Davidson Hotel sent some pictures of other renovations they have done, and she noted that these are available for review. Ford shared her enthusiasm for the new owners, stating that she is looking forward to the renovation that is planned. Ford then spoke about the brochure that was done in partnership with ICAD entitle "Working Numbers," which she distributed to Members. She noted that they plan to send these to business owners in Iowa City. Ford noted that this evening at 8:30 there is a show on Iowa Public Television called, "The Iowa Journal," and that she was interviewed last week for a segment on how communities use TIF in old mall renovation. Davidson then mentioned the southeast industrial area and proposed expansion for this area. He noted that they have hired a consultant who will be doing some preliminary design work on the sewers and the reconstruction of 420'h Street. He also added that he has had some discussion with property owners in the area, initiated by them, and that it appears the two main property owners are trying to work something out between them. COMMITTEE TIME: Hayek asked if they could talk about the Tuesday Economic Development meeting that they had with the Chamber, CVB, and other community members. He stated that he thought it was an excellent presentation. Bailey noted that the right people were definitely present for the meeting, to which others agreed. Ford stated that both Quellhorst and Schamberger had suggested, and others agreed, that they need to encourage others present to take a leadership role in this endeavor. They believe it would be better to have this leader set up the next meeting for this, rather than have it be City -led. Members briefly discussed the issue of SSMIDs and also non- profit participation in the economic development of downtown. Davidson then commented on the presentation, stating that he remembers what the downtown was like in the early 80's in Cedar Rapids, and that they did not have any restaurants back then. He noted that most people just do not believe that downtown Iowa City is that bad off. Bailey stated that she believes they need to frame it in the context of what other cities are doing. This led the discussion back to the budget, and how the City will not be able to continue doing what they have been doing for the downtown. Bailey stated again that she believes they need to show that downtown is not competitive, and that they need to be competitive with other cities. The discussion continued, with Members talking about the various housing needs. Hayek noted that in some respects, he feels they are painting themselves into a corner with student housing. Champion noted that she believes there is a decrease in 5-bedroom apartments for students, and that the market will adjust accordingly. The next meeting is scheduled for April 22, 2008 at 8:00 A.M. Economic Development Committee Meeting March 27, 2008 ADJOURNMENT: Champrion moved to adjourn the meeting at 8:55 A.M. Hayek seconded. Motion carried. Economic Development Committee Meeting March 27, 2008 Council Economic Development Committee ATTENDANCE RECORD 2008 TERM zt N ;., !;�t, A NAME EXP. 8" 8 M -4 N Regenia 01102/10 X X x X Bailey Matt 01102110 X X X X Hayek Connie 01102110 X X x x Champion Key: X = Present O = Absent O/E = Absent/Excused INITIAL REVIEW OF TEXTURES SALON WORKING CAPITAL Business Proposed: Textures Salon was founded in 2002. The business specializes in multi -cultural designs and services to women, men and children. Services include the following: color, relaxers, perms, waxing, weaves, extensions, braiding and haircuts. Upon expansion, owner will provide wigs, hairpieces and accessories for persons who have sustained hair loss due to alopecia and chemotherapy. The expansion will also allow the owner to rent studios for other entrepreneurs to operate their own business. The owner requests funds for working capital. Sales have increased steadily since 2004. 2005 sales were reported as $53,233; 2007 sales were $63,480; a 19% increase. The business qualifies as a micro -enterprise under the CDBG program. The owner qualifies as low -to -moderate income. A micro -enterprise is a commercial enterprise that has five or fewer employees, one or more whom owns the enterprise. At least 51 % of the employees must qualify as low -to -moderate income. Budget & Private Financial Contribution The applicant requests a $35,000 Iowa City CDBG 1 % interest loan (7-year maximum, 5 year deferred payment on $13,100). Applicant has invested $5,000 in inventory. Applicant has a commitment letter from a private lender for $103,000 subject to CDBG approval and a SBA guaranty. The private lender will take a Td mortgage on the owner's home, lien on all business assets and an assignment of the owner's life insurance policy. Comprehensive Plan/CITY STEPS Plan The project does not require public infrastructure and is located in a CC-2 zone (community commercial). CITY STEPS notes a high priority for the establishment and support of micro -businesses. Quality of Jobs The business is a woman owned business and qualifies as a micro -enterprise. Owner will hire one additional part time employee at $8.00/hour. Economic Impact The proposed CDBG funds will provide a woman owned business access to low interest working capital. The business is in need of low cost capital to achieve profitability. Environmental/Community Involvement The owner states that the build -out plan incorporates energy efficiency measures. Items to Address: 1. Business receives support and guidance through the Small Business Development Center. Staff encourages the business to continue utilizing this service, especially for financial management and reporting. April 2008 April 22, 2008 Council Economic Development Committee Textures Salon Textures Salon is a business expansion. The owner will move her business from a Coralville location and lease a larger facility in Iowa City (5 Sturgis Drive) and expand operations. The owner has experience operating her own business since 2002 and has an excellent credit history. The owner qualifies as low -to -moderate income and the business qualifies as a micro -enterprise. The business will also enable other entrepreneurs to rent a studio to operate their own business. Up to 8 studios are planned. The owner states that she has two confirmed stylists and another 2 prospective stylists interested in renting the studios. The owner has been working with Paul Heath, Small Business Development Center, with forecasted financial statements. Staff recommendation: $35,000 for working capital with a maximum term of 7 years at 1% interest. - $13,130 of the $35,000 loan will be deferred for five years as to enable the owner to obtain a SBA guaranty, however payment terms can't exceed the maximum term of 7 years. Staff recommends as a condition of the award the owner receive additional business assistance regarding financial management and reporting. The specific training required would be based on an evaluation by the Small Business Development Center. A UCC statement will be filed on all business assets. April 2008 Iowa City CDBG Economic Development Funds Application for Business Financial Assistance Business Requesting Financial Assistance: Individual Cheryl McMillan Home Address 420 1s Av., Coralville, IA 52241 Name of Applicant Business Textures Full Street Address of Business 5 Sturgis Drive, Iowa City, IA 52240 Phone Number & Email Address 319-351-8398, macone26(&msn.com DUNS Number (If awarded funds, applicant must obtain a DUNS number): Type of Business Salon and Spa Date Business Established October 2002, expanding to Iowa City the spring 2008 Bank of Business Account and Address (if applicable): Hills Bank and Trust NOTE: The City will not provide assistance in situations where it is determined that any repre- sentation, warranty or statement made in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has already been provided by the City prior to discovery of the incorrect, false or misleading representation, the City may initiate legal action to recover City funds. Revised 11/15/06 Section 1: Description of Business and Proposed Project 1.1. Describe the proposed "project" (for example, company relocation, building expansion, remodeling, new product line, number of new jobs, amount of investment in machinery and equipment) and the expected benefits it will receive from the financial assistance requested: The Business will relocate from Coralville to Iowa City. Currently Cheryl provides hair services and retail products. At the new location, in addition these services, Cheryl will provide wigs, hairpieces and accessories for teens and women of all races who have sustained hair loss due to alopecia and chemotherapy. A second objective is to establish, furnish, manage and support facilities to accommodate new entrepreneurs. 1.2. Provide a brief history of your company: Textures Salon was founded in 2002. The business specializes in multi -cultural designs and services to women, men and children. Services include the following: colors, relaxers, perms, waxing, weaves, extensions, braiding and haircuts. 1.3. Describe the organizational structure of the business: The business is organized a sole proprietorship. 1.4. Management (Proprietor, partners, officers, directors, all holders of outstanding stock, and 100% of ownership must be shown) Name & Position/Title Complete Address % Owned Cheryl McMillan — Proprietor 5 Sturgis Drive, Iowa City, IA 52240 100 Attach a brief description similar to a resume of the education, technical and business background for all the people listed under Management. 1.5. Will the project involve a transfer of operations or jobs from any other Iowa City or Johnson County facility or replace operations or jobs currently being provided by another Iowa City or Johnson County company? If yes, please indicate the facility(s) and/or company(s) affected. Yes, though the business is moving from Coralville to Iowa City, it will be expanding at the same time. Textures needs more space than is available at its current location. Additionally, the financial insatiability of the past landlord created uncertainly about the future of the location. Revised 11/15/06 Section 2: Financial Contributions to the Proposed Project 2.1. Use of Proceeds USE OF Proceeds Activity Loan Requested (Enter gross dollar amount rounded to the nearest hundreds) Land acquisition $0.0 New Construction/Expansion Repair $105000.00 Acquisition and/or Repair of Machinery and Equipment $17500.00 Inventory Purchase $5000.00 Working Capital (including accounts payable) $6000.00 Acquisition of Existing Business $0.0 All Other (provide description) $0.0 Total Loan Requested (All Sources): $133600.00 2.2. Terms of Proposed Financing (Sources) Proposed Financing Amount Monthly Payment Type �'� Rate Term Financial Institution : Hills Bank $98,500.00 1535 loan 8.0 7 years Fin. Inst. Other: CDBG Deferred for 5 years $13100 $0 for 5 yr. Deferred 1 % 7 Iowa City CDBG Economic Dev. Fund $21,900.00 270 Loan 1.0% 7 years TOTAL: $152000.00 1805 k +.,°�N 'b° °a €+a�v'z "gi"�s 1041, PCs...;.%;+ate,,.. (')For example: forgivable loan, direct loan, or grant. 2.3. Explain why assistance is needed from the City, and why it cannot be obtained elsewhere. If the applicant did not apply for a loan through a private financial institution, please explain why. If denied assistance through a financial institution, please attach the letter of denial. The bank wants more cash injection than I have available. They said they would loan up to $103,000 if I could come up with some other sources of financing. Revised 11/15/06 2.4. Indicate the owner's contribution (cash, assets for the operation of the business, etc.) to this project. The owner has approximately $5,000 in inventory that she has invested in the business. Additionally, she has many loyal customers that will follow her to this new location. 2.5. Identify all agencies or institutions involved in the project (financial, technical assistance, etc.) and what their involvement is: Caldwell Banker; Linda Thrasher, Real Estate Agent Marshall's Pro Center: Designer of and equipment supplier for salons, Bill Schmidt, designer, Moline, IL Hills Bank and Trust Small Business Development Center, Paul Heath City of Iowa City CDBG program, Tracy Hightshoe 2.6. What type of security will the assisted business provide the City? If no security or less than the dollar amount requested is offered, an explanation must be provided. ❑ Corporate Guaranty X UCC Financing Statement ❑ Irrevocable Letter of Credit X Personal Guarantee ❑ Surety Bonds ❑ Mortgage on Real Estate ❑ Escrow Account ❑ Other: Before execution of a CDBG agreement, if the collateral consists of machinery and equipment, inventory, or other, the applicant must provide an itemized list that contains serial and identification numbers for all articles that had an original value of greater than $5,000. Include a legal description of real estate offered as collateral. 2.7 If the City did not provide financial assistance, could the project proceed? Probably not. The bank is not willing to loan the full amount needed. Section 3: Jobs to Be Created/Retained Special Note: The Community Development Block Grant (CDBG) program requires that at least 51% of the jobs created or retained must be held by or made available to low - moderate income persons. The business acknowledges that if it fails to create and/or retain the jobs identified below by the end of the project period and maintain them for a period of time (usually 12 months from the date of the award); it may be required to reimburse City funds for the employment shortfall. Revised 11/15/06 3.1 If an existing business, how many employees are currently employed at your Iowa City location? Please attach a copy of the company's quarterly Iowa "Employer's Contribution and Payroll Report" for the most recent quarter. The business will employ the owner as well as a part-time (20 hours/week) sales clerk. 3.2 Complete the following chart identifying the number of jobs to be created and/or retained based on this specific project. Type of Job and Hourly Rate for Created and/or Retained Positions in First 12 Months of Project Award (please see attached Job Category Definitions) # of Jobs Created # of Jobs Retained Type of Job No. Hours Per Week Hourly Rate of Pay Fringe Benefits* 1 Officials & Managers 40 14.50 Professional Technicians 1 Sales 20 8.00 Office & Clerical Craft Wokers (Skilled) Operatives (semi -skilled) Laborers (unskilled) Service Workers If fringe benefits are provided, please attach a description of all employee benefits provided by and paid for (in full or in part) by the business. 3.3 What is the estimated annual payroll for the new employees resulting from this project? Owner - $30000 Sales Clerk - $11,000 3.4 If an existing business, will any of the current employees lose their jobs if the project does not proceed? If yes, how many? Explain why: W Section 4: Economic & Environmental Impact 4.1. What other Johnson County companies could be considered to be your competitors? There are not many salons that specialize in multicultural hair. Gspot - does not sell wigs. Europa Revised 11/15/06 4.2. Please describe the energy and resource efficiency programs, waste reduction, waste exchange, and recycling programs at your Iowa City operation. Textures is working a green and eco-friendly builder, All Wells Construction. The plan incorporates energy efficiency into their build out. Section 5: Community Involvement, Compliance with Law 5.1 In addition to your normal business activities, does your business contribute or have plans to contribute to the community through volunteer work, financial contributions, or through other means? Please describe. Cheryl is considering the Chamber of Commerce Leadership class for the upcoming year. 5.2 Has the business been cited or found to violate any federal or state statute or regulation within the last five years (including, but not limited to environmental regulations, payroll taxes, Occupational Safety and Health Administration laws, Fair Labor Standards, the National Labor Relations Act, the Americans with Disabilities Act)? If yes, please explain the circumstances of the violation(s). No. 5.3 Has the company or any officer of your company been involved in bankruptcy or insolvency proceedings during the past 7 years from the date of this application? If so, provide the details. IM 5.4 Are you or your business involved in any pending lawsuits? If yes, provide the case name of the lawsuit, docket number, and city and state where it is pending. M Section 6: Summary of Required Attachments Check off each attachment submitted. If not submitted, explain why. Business plan (if start-up business) Textures is an existing business, x l Balance Sheet (3 year historical if an existing business. Start-ups must provide a pro - forma balance sheet) Cheryl has tax returns from accountant for the last 3 years. Ix l Profit and loss statements (3 year historical if an existing business, 3 year projection for start-ups) Cheryl has tax returns from accountant for the last 3 years. [ x l 12 month cash flow statement (if the business does not expect to turn profitable within the first 12 months, provide a cash flow statement extended to the year the business expects to turn profitable) Revised 11/15/06 Cash flow included. [ ] Description of fringe benefits provided to employees, if applicable No fringe benefits for employees at this time. However, Cheryl has a personal health insurance policy. [ ] Brief description of the education, technical and business background for all the persons listed under Management (Question #1.4) See Resume [ x Please provide the social security numbers for all the persons listed under Management (Question #1.4) [ x l If an existing company, copy of the company's quarterly Iowa "Employer's Contribution and Payroll Report" for the most recent quarter. Cheryl does not need this report as she does not have any employees at this time. [ x l Construction loans only: Cost estimates for construction and a statement of the source of any additional funds [x l Include a list of any machinery or equipment or other non -real estate assets to be purchased with the financial assistance and the cost of each item as quoted by the seller. Include the seller's name and address. Upon review of a submitted application, the City reserves the right to request additional information in order to assist the City with its evaluation of an application. Release of Information and Certification NOTE: Please read carefully before signing I hereby give permission to the City of Iowa City (the City) to research the company's history, make credit checks, contact the company's financial institution, and perform other related activities necessary for reasonable evaluation of this proposal. I understand that all information submitted to the City relating to this application is subject to the Open Records Law (1994 Iowa Code,, Chapter 22) and that confidentiality may not be guaranteed. I hereby certify that all repre- sentations, warranties or statements made or furnished to the City in connection with this application are true and correct in all material respects. I understand that it is a criminal violation under Iowa law to engage in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of procuring economic development assistance from a state agency or political subdivision. Revised 11/15/06 If applicant is a proprietor or general partner, sign below. By: 401A10 w� - � Date: . 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G w o 0 0 0 ( o i O f m ' � I a i 4 i a0 f M O> i M I O I �J gyp• M CD cOp i i i N I O ! CN 000 (gyp ' - i I + a 1 i =' Y ! cn LI a c f0 y m O i N U .N.. w I y N + a to ! E I E L!J c_ I ¢_ a m T c o f .;a 0 i i} f £ a W �I� 0 g Z ,m �i i EI N i I m Cc U W o (D ! $ y a n 3m 90 U V RESUME CHERYL MCMILLAN ADDRESS: 4916 E. Court St Iowa City. Ia 52245 Phone: 319-341-6222 E-mail: macone26(2a msn.com BIRTHPLACE Cairo, Ill EDUCATION School Degree/Professional Certification La James Associate in Science International College and Arts of Cosmetology Iowa City, Ia Pivot Point College of Certificate Advanced Cosmetology Chicago, Ill Paul Mitchell Co. Certificate Kansas City, Mo Kirkwood Community College Course Work Iowa City, Ia Date Area of Study 1997 Cosmetology 2000 Techniques: Extensions Weaves Specialty braiding 2000 Representative Trends and products in Cosmetology 2000 Accounting Mathematics Computer skills EMPLOYMENT Organization/ Work Performed Date(s) Location Textures Beauty Salon Sole Proprietor Nov 2002-Present 420 first Ave Sales and Services Coralville, Ia Relaxers, haircuts, waxing, permanent waves, colors, highlights, low lights, color corrections & formal updo's. Specializing in: braids, twists & hair extensions. Scheduling of clients, daily sales record and inventory JCPenny Beauty Salon Sales and Services Feb 1997-Oct 2002 Coralville, Ia Scheduling of clients, cashier for sales, specialized training for teaching of hair trends. Services: waxing, haircuts, braids, twists, colors, highlights, lowlights, color corrections, permanent waves and relaxers. Mizani products certification. Rumors Beauty Salon Sales and Services Apr 1996-Jan 1997 Iowa City, Ia Eagles Grocery Store Assistant Produce Manager Apr 1995-Apr 1996 Iowa City, Ia Health Care Facilities Hospital Technician Apr 1993- Apr 1995 The University of Central Sterilization Iowa Hospital & Dietetics Services Clinics Iowa City, Ia Burlington Medical Central Sterilization Nov 1989-Feb 1993 Center Burlington, Ia Dietetic Services Elm View Care Center Dietetic Services Apr 1980-Apr 1981 Burlington, Ia MY ASPIRATIONS My goal is to support and aid the community by expansion of the availability of beauty care services, education, and support for a growing clientele. The first of two objectives are to assist children, teens and women of all ethnicities who suffer from various forms of hair loss due to events such as medical procedures, alopecia, injury or abuse. The breath of the assistance will be evidenced by enhanced availability of products and services on - site (wigs, quick weaves, hair pieces, accessories, cosmetics, waxing and skin care). A second objective is to establish, furnish, manage and support facilities to accommodate new entrepreneurs. My background and interests will allow new owners to benefit from my experience, to see around corners, anticipate what is coming and how to navigate among the options. A major emphasis will be to aid others to learn to make plans that reflect good business decisions; and to provide customer services that convey professionalism and confidence, builds good will, and establishes positive relationships. The aspiration then, is to test a formula to give back to our community by using our finite resources to illustrate the possibilities of what can be done together to keep moving forward together. C 4AAA 4 2001 D a or #w Tre aviry ► P r 1 . e�C. nwO fife Form 11t135 or 1065-B. Attachment kdamal Re,reax,e Seevice (sg) 10, Attach to Form 1040,1 [If tit ► See Instructions for Schedule C (Form 1040). sequence No. 09 Name of proprietor Social security number (SSN) CHERYL L MCMILLAN mil_ A Principal business or profession, including product or service (see instructions) B Enter code from instr. HAIR STYLIST imam C Business name. If no separate business name, leave blank. D Employer ID no. (EIN), fl any TEXTURES E Business address (including suite or room no.) ► City, town or post office, state, and ZIP code CORALV I LLE IA 52241 F Accounting method: (1) V1 Cash (2) U Accrual (3) Other (specify) ► G Did you "materially participate" in the operation of this business during 20077 If "No," see instructions for limit on losses.......... N Yes No H if you started or acquired this business during 2007, check here...................................................................... ► Income 1 Gross receipts or sales. Caution. If this income was reported to you on Form W-2 and the "Statutory employee" box on that form was checked, see instructions and check here ............................ ► 2 Returns and allowances........................................................................................ 3 Subtract line 2 from line 1...................................................................................... 4 Cost of goods sold (from line 42 on page 2).................................................................... 5 Gross profit. Subtract line 4 from line 3.................................................... I ......... I ........1 6 Other income, including federal and state gasoline or fuel tax credit or refund (see instructions) .................... 1 63,480. 2 3 63,480. 4 7,411. 5 56,069. 6 7 Gross income. Add lines 5 and 6............... .... ........................ ...... I.......................... ► 1 7 56,069. ' Expenses. Enter expenses for business use of your homeonly on line 30. 8 Advertising .............................. 9 Car and truck expenses (see instructions) ........................ 10 Commissions and fees .................... 11 Contract labor (see instructions) ........... . .. . . . . . . . . .. 12 Depletion ................................ 13 Depreciation and section 179 expense deduction (not included in Part 111) (see instructions) .............. 14 Employee benefit programs (other than on line 19) .................... 15 Insurance (other than health) .............. 16 Interest: a Mortgage (paid to banks, etc.) ............ b Other .................................... 17 Legal and professional services .................................. 8 1,256. 18 Office expense ...................... 19 Pension and profit-sharing plans ...... 20 Rent or lease (see instructions): a Vehicles, machinery, and equipment.. b Other business property ............ 21 Repairs and maintenance ............ 22 Supplies (not included in Part 111) .... 23 Taxes and licenses .................. 24 Travel, meals, and entertainment: a Travel .............................. b Deductible meals and entertainment (see instructions) ...... 25 Utilities ............ I ....... , ... I ... 26 Wages (less employment credits) ..... 27 Other expenses (from line 48 on page 2) .......................... 18 9 739. 19 20a 10 11 20b 7,140. 21 12 22 1,987. 13 23 24a 14 24b 114. 15 2 0 2 .. 25 188. 16a 26 27 4,168. 16b 17 28 Total expenses before expenses for business use of home. Add lines 8 through 27 in columns ................ ► 28 15,794. 29 Tentative profit (loss). Subtract line 28 from line 7............................................................ 29 40,275. 30 Expenses for business use of your home. AttachForm 8829...................................................... 30 _ 31 Net profit or (loss). Subtract line 30 from line 29. • If a profit, enter on both Form 1040, line 1Z and Schedule SE, line 2, or on Form 1040NR, line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 31 40, 2 7 5 . • If a loss, you must go to line 32. 32 if you have a loss, check the box that describes your investment in this activity (see instructions). • If you checked 32a, enter the loss on bothForm 1040, line 12, and Schedule SE, line 2, or on Form 32a H All investment is at risk. 1040NR, line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 32b Some investment is not • If you checked 32b, you must attach Form 6198. Your loss maybe limited. at risk. For Paperwork Reduction Act Notice, see instructions. Schedule C (Form 1040) 2007 Rf:A Cwvriaht form software only. 2007 Universal Tax Systems. Inc. AN rights reserved. USSCHC$1 Rev. 1 Schedule C (Form 1040) 2007 CHERYL L MCMILLAN Page Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: a ® Cost b 0 Lower of cost or market c n Other (attach explanation) 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? if „Yes,,, attach explanation ............. ........................ ................... I............................. Yes ® No 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation .................... 35 2,622. 36 Purchases less cost of items withdrawn for personal use ........................................................ 36 7,182. 37 Cost of labor. Do not include any amounts paid to yourself .................................................... 37 38 Materials and supplies........................................................................................ 38 39 Other costs 40 Add lines 35 through 39...................................................................................... 40 9,804. 41 Inventory at end of year..................................................................................... 2,393. 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on page 1, line 4 ....................1 42 1 7,411. Information on Your Vehicle. Complete this partonly if you are claiming car or truck expenses on fine 9 and are not required to file Form 4562 for this business. See the instructions for line 13 to find out if you must file Form 4562. 43 When did you place your vehicle in service for business purposes? (month, day, year) ► 01 / 01 / 2 0 0 2 44 Of the total number of miles you drove your vehicle during 2007, enter the number of miles you used your vehicle for: Commuting a Business 1523 b (seeinstr.) c Other 45 Do you (or your spouse) have another vehicle available for personal use? .......................................... ® Yes Q No 46 Was your vehicle available for personal use during off -duty hours? ............................................. ® Yes No 47a Do you have evidence to support your deduction? ... . .. . .......... . ... . . . . . . . . .. . . . . . ............................ ® Yes F1 No bIf "Yes,,, is the evidence written?......................................................... I ...................... Yes n No Other Expenses. List below business exoenses not included on lines 8-26 or line 30. MAGAZINES 322. TELEPHONE 1,893. HAIR SHOW AND EDU 950. ACCOUNTANT 200. CC MACHINE AND BANK FEES 803. LICENSES 48 Total other expenses. Enter here and on page 1, line 27................................................7481 4,168. Schedule C (Form 1040) 2007 BCA Copyright form software only, 2007 Universal Tax Systems, Inc. All rights reserved. USSCHC$2 Rev. 1 Schedule C Profit or Loss From Business Gran No. 1545-&07a (Form 1040) (Sole Proprietorship) 20�6 ► Partnerships, joint ventures, etc., must file Form 1065 or 1065-B. Department of the Treasury Attachment internal Revenue Service (99) ► Attach to Form 1040, 1040NR, or 1041. ► See instructions for Schedule C (Form 1040). Sequence No. 09 Name of proprietor — — SoclalaritnumberN) CHERYL L MCMILZAN A Principal business or profession, including product or service (see instructions) B Enter codefr tr. HAIR STYLIST C Business name. If no separate business name, leave blank. D Employer ID no (EIN). d any TEXTURES E Business address (including suite or room no.) ► im 10�' —City, town or post office, state, and ZIP code CORALV I LLE IA 52241 F Accounting method: (1) N Cash (2) Accrual (3) Other (specify) ► No Did you "materially participate" in the operation of this business during 2006? If "No," see instructions for limit on losses ....... H if you started or acquired this business during 2006, check here........................................................... ► ncome Gross receipts or sales. Caution. If this income was reported to you on Form W-2 and the "Statutory employee" box on that form was checked, see instructions and check here ............................ ► 1 59, 810. 2 Returns and allowances ......... .............................................................................. 2 3 Subtract line 2 from line 1...................................................................................... 3 59, 810. 4 Cost of goods sold (from line 42 on page 2) ............... ..................................................... 4 8, 308. 5 Gross profit, Subtract line 4 from line 3 .......... . . ... . ............... . ............ . ............ . .............. 5 51,502. 6 Other income, including federal and state gasoline or fuel tax credit or refund (see instructions) .................... 6 7 Gross income. Add lines 5 and 6.......................................................................... ► 7 51, 502. Expenses. Enter expenses for business use of your home only on line 30. 8 Advertising .............................. 8 1, 0 9 9 . 18 Office expense ...................... 18 2, 070. 9 Car and truck expenses 19 Pension and profit-sharing plans ...... 19 (see instructions) ....................... . 9 669. 20 Rent or lease (see instructions): 10 Commissions and fees .............. . ..... 10 a Vehicles, machinery, and equipment .. 20a 11 Contract labor b Other business property ... , ....... 20b 7, (see instructions) .......... ............. 11 21 Repairs and maintenance ........ I ... 21 12 Depletion .................. . ............. 12 22 Supplies (not included in Part III) .... 22 13 Depreciation and section 179 23 Taxes and licenses .................. 23 expense deduction (not included 24 Travel, meals, and entertainment: in Part III) (see instructions) .............. 13 a Travel ........... , .................. 24a 288. 14 Employee benefit programs b Deductible meals and (other than on line 19) .. . ............... . . 14 entertainment (see instructions) . , .... 24b 427. 15 Insurance (other than health) .............. 15 188. 25 Utilities ....................... . .... 25 _ 166. 16 Interest: 26 Wages (less employment credits)...... 26 a Mortgage (paid to banks, etc.) ..... , ...... 16a 27 Other expenses (from line 48 b Other....................................16b on page 2) .......................... 27 3, 094. 17 Legal and professional services .................................. 1 17 28 Total expenses before expenses for business use of home. Add lines 8 through 27 in columns ................ ► 28 15, 141. 29 Tentative profit (loss). Subtract line 28 from line 7 .............................. ............................. 29 1 36, 361. 30 Expenses for business use of your home. Attach Form 8829...................................................... 30 31 Net profit or (loss). Subtract line 30 from line 29. • If a profit, enter on both Form 1040, line 12, and Schedule SE, line 2, or on Form 1040NR, line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 31 36, 361. • If a loss, you must go to line 32. 32 If you have a loss, check the box that describes your investment in this activity (see instructions). • if you checked 32a, enter the loss on both Form 1040, line 12, and Schedule SE, line 2, or on Form 1 32a All investment is at risk. 1040NR, line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. J i 32b U Some investment is not • If you checked 32b, you must attach Form 6198. Your loss may be limited. at risk. Schedule C (Far, 134:�) 20GC6 K� _ T _ Page 2 L ._. _.. Cost of Goods Said (see instructions) 33 Method(s) used to value closing inventory: a i Cost b '7 Lower of cost or c -' Other (attach explanation) j market 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? if "Yes," attach explanation...................................................................................... i-; Yes �Xj No 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation ....................I 35 i -1, 204 . 36 Purchases less cost of items withdrawn for personal use ......................................... ............ .i 36 9, 7 2 6 . 37 Cost of labor. Do not include any amounts paid to yourself.............................37 38 Materials and supplies........................................................................................IL 38 i- ----___ --_ . 39 Other costs.....................................I .............I.............1.1.... .......................... 40 Add lines 35 through 39..................................................................................... 40 % 10, 930. 41 Inventory at end of year .... ............ ...................................................................... I 41 2, 622 . 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on page 1, line 4 ....................� 42 j 8, 308 . information on Your Vehicle. Complete this part only if you are claiming car or truck expenses on line 9 and are not required to file Form 4562 for this business. See the instructions for line 13 to find out if you must file Form 4562. 43 When did you place your vehicle in service for business purposes? (month, day, year) W 0 1 / 01. / 2 0 0 2 44 Of the total number of miles you drove your vehicle during 2006, enter the number of miles you used your vehicle for: Commuting a Business 1503 b (see instr,) _ _ _ c Other 45 Do you (or your spouse) have another vehicle available for personal use? .......................................... Yes s No 46 Was your vehicle available for personal use during off -duty flours? .......... ...................................... Yes LJ No 47a Do you have evidence to support your deduction? ..................................... . ..........................{j Yes �' No b If "Yes." is the evidence written? .................... .................. . . . . .................................. . .. �Xj Yes n No •mil• Othar F:YnAnsa.q_ 11st holm husiness exnenses not included on lines 8-26 or line 30, MAGAZINES 306. 'PELEPHONIa __--� l i ------_- 1, 838-_. _. HAIR SHOW AND EDU +-- 372. — _ ACCOUNTANT 300. BANK FEE i 142, CC' MACHINE TCENSES 84. _ — _ - ----- i i 48 Total other expenses. Enter here and on page 1, line 27 .............. . 1 .... ! 48 � 3,094. Schedule C (Form 1040)2006 Schedule C (Form 1040) Department of the Treasury Internal Revenue Service Profit or Loss From Business (Sole Proprietorship) ► Partnerships, joint ventures, etc., must file Form 1065 or 1065-8. ► Attach to Form 1040 or 1041. ► See instructions for Schedule C (Form 1 Name of proprietor CHERYL L MCMILLAN A Principal business or profession, including product or service (see instructions) HAIR STYLIST Social OMB No. 1545-0074 2005 Attachment Sequence No. 09 ority-aumber (SSN) C Business name. If no separate business name, leave blank. D Employer ID no. (EIN), if any TEXTURES E Business address (including suite or room no.) ► 4: City, town or post office, state, and ZIP code CORALV I LLE IA 52241 F Accounting method: (1) Cash (2) Accrual (3) LJ Other (specify) ► G Did you "materially participate" in the operation of this business during 2005? If "No," see instructions for limit on losses ......... Yes No H If you started or acquired this business during 2005, check here .................................... ............................... ► me 1 Gross receipts or sales.Caution. If this income was reported to you on Form W-2 and the "Statutory employee" box on that form was checked, see instructions and check here ........................... ► 1 53, 233. 2 Returns and allowances........................................................................................ 2 3 Subtract line 2 from line 1...................................................................................... 3 5 3, 2 3 3. 4 Cost of goods sold (from line 42 on page 2).................................................................... 4 6,359 . 5 Gross profit. Subtract line 4 from line 3........................................................................ 5 46, 874 6 Other income, including Federal and state gasoline or fuel tax credit or refund (see instructions)......... .......... 6 7 Gross income.Add lines 5 and 6.......................................................................... 7 46, 874 Expenses. Enter expenses for business use of your homeDnly on line 30. ► 8 Advertising .............................. 8 1,284. 18 Office expense .... 18 1 546. , 9 Car and truck expenses 19 Pension and profit-sharing plans ...... 19 (see instructions) ........................ 9 710. 20 Rent or lease (see instructions): 10 Commissions and fees .................... 10 aVehicles, machinery, and equipment.. 20a 11 Contract labor b Other business property ............ 20b 6, 830. (see instructions) ........................ 11 21 Repairs and maintenance ............ 21 12 Depletion ................................ 12 22 Supplies (not included in Part III) .... 22 13 Depreciation and section 179 23 Taxes and licenses .................. 23 expense deduction (not included 24 Travel, meals, and entertainment: in Part III) (see instructions) .............. 13 a Travel .............................. 24a 294 . 14 Employee benefit programs b Deductible meals and (other than on line 19) .................... 14 entertainment (see instructions) ...... 24b 182 . 15 Insurance (other than health} ............. 15 218. 25 Utilities ............................ 25 151 . 16 Interest: 26 Wages (less employment credits) ..... 26 a Mortgage (paid to banks, etc.) ............ 16 27 Other expenses (from line 48 b Other ........ ........................... 16b on page 2) .......................... 27 2, 648 . 17 Legal and professional services .................................. 17 28 Total expenses before expenses for business use of home. Add lines 8 through 27 in columns ............... ► 28 13, 863. 29 Tentative profit (loss). Subtract line 28 from line 7............................................................ 29 33, 011. 30 Expenses for business use of your home. Attaclform 8829...................................................... 30 31 Net profit or (loss). Subtract line 30 from line 29. • If a profit, enter on Form 1040, line 12 and also on Schedule SE, line 2(statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 31 33,011. • If a loss, you must go to line 32. 32 If you have a loss, check the box that describes your investment in this activity (see instructions). • If you checked 32a, enter the loss crform 1040, line 1Z and also on Schedule SE, line 2 32a All investment is at risk. (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 32b H Some investment is not • If you checked 32b, youmust attach Form 6198. Your loss maybe limited, at risk. For Paperwork Reduction Act Notice, see Form 1040 instructions. Schedule C (Form 1040) 2005 BCA Copyright form software only, 2005 Universal Tax Systems, Inc. All rights reserved. USSCHC$1 Rev. 1 Schedule C (Form 1040) 2005 CHERYL L MCMILLAN Page 2 Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: a ® Cost b a Lower of cost or c market Other (attach explanation) 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? if „Yes,,, attach explanation...................................................................................... Yes No 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation .................... 1 35 1,038. 36 Purchases less cost of items withdrawn for personal use........................................................I 36 6, 525. 37 Cost of labor. Do not include any amounts paid to yourself ................................................... 38 Materials and supplies....................................................................................... 39 Other costs.................................................................................................. 40 Add lines 35 through 39......................................................................................1 40 1 7,563. 41 Inventory at end of year...................................................................................... 41 1,204. 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on page 1, line 4 .................... 42 6,359. MUNTM Information on Your Vehicle. Complete this partonly if you are claiming car or truck expenses on line 9 and are not required to file Form 4562 for this business. See the instructions for line 13 to find out if you must file Form 4562. 43 When did you place your vehicle in service for business purposes? (month, day, year) ► 01 / 01 / 2 0 0 2 44 Of the total number of miles you drove your vehicle during 2005, enter the number of miles you used your vehicle for: Commuting a Business 1553 b (seeinstr.) c Other 45 Do you (or your spouse) have another vehicle available for personal use? .......................................... ® Yes No 46 Was your vehicle available for personal use during off -duty hours? ................................................ ® Yes a No 47a Do you have evidence to support your deduction?................................................................ ® Yes No b If"Yes,"is the evidence written? ...................................... :......................................... Yes I No Other ExDenSes. List below business expenses not included on lines 8-26 or line 30. MAGAZINES 322. TELEPHONE 1,732. HAIR SHOW AND EDU 130. ACCOUNTANT 320. BANK FEE 144. 48 Total other expenses.Enter here and on page 1, line 27.................................................. 48 2, 648. Schedule C(Form 1040)2005 BCA Copyright form software only, 2005 Universal Tax Systems, Inc. All rights reserved. USSCHC$2 Rev. 1 Textures Salon Balance Sheet As of April 7, 2008 4/7/2008 Assets Current Assets Checking/Savings Hills Bank 2,756.92 Total Checking/Savings 2,756.92 Accounts Receivable Total Accounts Receivable ___0__ Other Current Assets Inventory Retail 3,500.00 Total Current Assets 3,500.00 Fixed Assets Equipment 1,500.00 Total Fixed Assets Cost 1,500.00 Total Fixed Assets 1,500.00 Total Assets 7,756.92 Liabilities & Equity Liabilities Currents liabilities --- 0___ Total Liabilities --- 0___ Equity Additional paid in Capital 4,167.16 Net Income 3,589.76 Total Equities 7,756.92 Total Liabilities & Equities 7,756.92 INITIAL REVIEW OF ALFIE'S BEAUTY SUPPLY WORKING CAPITAL Business Proposed: Alfie's Beauty Supply opened in March 2007 at 400 Kirkwood Avenue. The business specializes in African -American beauty supplies and sells wigs, hair pieces, hair products and some clothing. The owner requests funds for working capital. The business reported $17,535 in sales in 2007. The business qualifies as a micro -enterprise under the CDBG program and the owner qualifies as low -to -moderate income. A micro -enterprise is a commercial enterprise that has five or fewer employees, one or more whom owns the enterprise. At least 51 % of the employees must qualify as low -to -moderate income. Budget & Private Financial Contribution The applicant requests a $10,000 Iowa City CDBG 3% interest loan with a term of 5 years. Applicant invested $3,500 to open the business and was awarded a $3,000 grant through the Resident Opportunities for Self -Sufficiency (ROSS) Program through the Iowa City Housing Authority to help pay business expenses. The ROSS grant was competitive and awarded to a small number of persons receiving Section 8 assistance. Comprehensive Plan/CITY STEPS Plan The project does not require public infrastructure and is located in a CI-1 zone (intensive commercial). CITY STEPS notes a high priority for the establishment and support of micro -businesses. Quality of Jobs The business is a woman owned business and qualifies as a micro -enterprise. Economic Impact The proposed CDBG funds will provide a woman owned business access to low interest working capital. Environmental/Community Involvement The owner stated she provided free wigs to three cancer patients and hopes to offer this same service to others in the future. Items to Address: 1. The business has no employees, only the owner. Is someone available to run the store when the owner is absent? The store is currently open 11-5 Tuesday through Saturday. 2. Will the business consider expanding the hours in the future? April 2008 April 22, 2008 Council Economic Development Committee Alfie's Beauty Supply Alfie's is a micro -enterprise business requesting financial assistance to expand the inventory and to make store improvements. The owner has operated the business for one year. She has a high school diploma and one year of college. She has been working with the Small Business Development Center on forecasted financial statements and general operations. The owner has had prior credit problems, but is in the process of clearing up three accounts in collection. The total amount owed is relatively small. References from the Iowa City Housing Authority, Amy Holcomb, Employment Specialist at Goodwill, and the landlord of the business have all been excellent. Owner has paid her personal rent and business rent on time each month. Both the business landlord and Employment Specialist noted the owner's commitment to the business. Amy stated that the owner strongly believes in the store, its products and completed a lot of the remodeling herself. The business operated at a loss in the first year; however the owner is working on increasing her clientele. Staff recommendation: $5,000 loan for working capital to limit risk/exposure with a maximum term of 5 years at 0% interest. To purchase the inventory the owner wants from one specific supplier, an initial $5,000 order is required. After the initial order, the client is able to order supplies in lesser quantities. Staff recommends as a condition of the award the owner receive additional business assistance regarding financial management, reporting and marketing. The specific training required would be based on an evaluation by the Small Business Development Center. A UCC statement will be filed on all business assets. April 2008 Iowa City CDBG Economic Development Funds Application for Business Financial Assistance Business Requesting Financial Assistance: Individual Franki E. Cooley Home Address 533 Olive St. Name of Applicant Business Alfie's Beauty Supply Full Street Address of Business 400 Kirkwood Ave. Phone Number & Email Address 319-877-0952 DUNS Number (If awarded funds, applicant must obtain a DUNS number): Type of Business: Retail Date Business Established: 03/01/2007 Bank of Business Account and Address (if applicable): Wells Fargo NOTE: The City will not provide assistance in situations where it is determined that any repre- sentation, warranty or statement made in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has already been provided by the City prior to discovery of the incorrect, false or misleading representation, the City may initiate legal action to recover City funds. Revised 11/15/06 Section 1: Description of Business and Proposed Project 1.1. Describe the proposed "project" (for example, company relocation, building expansion, remodeling, new product line, number of new jobs, amount of investment in machinery and equipment) and the expected benefits it will receive from the financial assistance requested: The current location is fine. However, I would like to expand my retail space by taking out a wall that breaks up the space that I rent. Additionally, I would like to upgrade the lighting because the retail display area has poor lighting. Finally, I would like to increase my inventory by $5,000 so I have a larger assortment of what my customers are asking for. This will help increase sales in future months. 1.2. Provide a brief history of your company: I opened this business with my income tax refund in March of 2007 for a little under $3,500. I'm the only African -American beauty supply store in Iowa City, IA and Coralville, IA. 1.3. Describe the organizational structure of the business: 1 run the business alone it is organized as a sole proprietorship. I sell wigs, hair pieces, and hair products. I have a small amount of clothing. 1.4. Management (Proprietor, partners, officers, directors, all holders of outstanding stock, 100% of ownership must be shown) Name & Position/Title Complete Address % Owned Franki Cooley 533 Olive St., Iowa City, IA 52246 100 Attach a brief description similar to a resume of the education, technical and business background for all the people listed under Management. I have no college or business degree. 1.5. Will the project involve a transfer of operations or jobs from any other Iowa City or Johnson County facility or replace operations or jobs currently being provided by another Iowa City or Johnson County company? If yes, please indicate the facility(s) and/or company(s) affected. No. Revised 11/15/06 Section 2: Financial Contributions to the Proposed Project 2.1. Use of Proceeds USE OF Proceeds Activity Loan Requested (Enter gross dollar amount rounded to the nearest hundreds) Land acquisition $ -- New Construction/Expansion Repair $3,500.00 Acquisition and/or Repair of Machinery and Equipment $ -- Inventory Purchase $5,000.00 Working Capital (including accounts payable) $ Acquisition of Existing Business $ All Other (provide description) Advertise $1,500.00 Total Loan Requested (All Sources): $10,000.00 2.2. Terms of Proposed Financing (Sources) Proposed Financing Amount Monthly Payment Type Rate Rate Term Financial Institution: $ Financial Institution : $ Other: $ Iowa City CDBG Economic Dev. Fund $10,000 $180.00 Loan 3% 5 years TOTAL: $10,000 $180.00 ¢ d (')For example: forgivable loan, direct loan, or grant. 2.3. Explain why assistance is needed from the City, and why it cannot be obtained elsewhere. If the applicant did not apply for a loan through a private financial institution, please explain why. If denied assistance through a financial institution, please attach the letter of denial. There is no one reason why I need help from the City. I'm a single mother of 5. One of my children has Narcolepsy which requires a lot of doctor visits. So working a second job is not an option right now. My credit isn't the best. So my options are few, next to none. Revised 11/15/06 2.4. Indicate the owner's contribution (cash, assets for the operation of the business, etc.) to this project. I put in $3,500 to start business in 2007. Most of my family personal expenses are covered by various programs. Any profits I can take out of business will be very helpful to the family. 2.5. Identify all agencies or institutions involved in the project (financial, technical assistance, etc.) and what their involvement is: The Ross program helped me for two months in rent, utilities and inventory. 2.6. What type of security will the assisted business provide the City? If no security or less than the dollar amount requested is offered, an explanation must be provided. ❑ Corporate Guaranty ❑ UCC Financing Statement ❑ Irrevocable Letter of Credit X Personal Guarantee ❑ Surety Bonds ❑ Mortgage on Real Estate ❑ Escrow Account X Other: Inventory All I have is my word and business. I have to make this work for the sake of my children and self. Before execution of a CDBG agreement, if the collateral consists of machinery and equipment, inventory, or other, the applicant must provide an itemized list that contains serial and identification numbers for all articles that had an original value of greater than $5,000. Include a legal description of real estate offered as collateral. 2.7 If the City did not provide financial assistance, could the project proceed? Yes. Slowly but surely I would make it work. Section 3: Jobs to Be Created/Retained Special Note: The Community Development Block Grant (CDBG) program requires that at least 51% of the jobs created or retained must be held by or made available to low - moderate income persons. The business acknowledges that if it fails to create and/or retain the jobs identified below by the end of the project period and maintain them for a period of time (usually 12 months from the date of the award); it may be required to reimburse City funds for the employment shortfall. 3.1 If an existing business, how many employees are currently employed at your Iowa City location? Please attach a copy of the company's quarterly Iowa "Employer's Contribution and Payroll Report" for the most recent quarter. One, myself. Revised 11/15/06 3.2 Complete the following chart identifying the number of jobs to be created and/or retained based on this specific project. Type of Job and Hourly Rate for Created and/or Retained Positions in First 12 Months of Project Award (please see attached Job Category Definitions) # of Jobs Created # of Jobs Retained Type of Job No. Hours Per Week Hourly Rate of Pay Fringe Benefits* Officials & Managers Professional Technicians 1 Sales 40 $7.25 Office & Clerical Craft Wokers (Skilled) Operatives (semi -skilled) Laborers (unskilled) Service Workers *If fringe benefits are provided, please attach a description of all employee benefits provided by and paid for (in full or in part) by the business. No benefits. Once established, will review benefits. 3.3 What is the estimated annual payroll for the new employees resulting from this project? Not applicable. 3.4 If an existing business, will any of the current employees lose their jobs if the project does not proceed? If yes, how many? Explain why: No. Section 4: Economic & Environmental Impact 4.1. What other Johnson County companies could be considered to be your competitors? Sally Beauty Supply — different market and no wigs. African -American selection is only about 10% This business does not sell directly to the public 4.2. Please describe the energy and resource efficiency programs, waste reduction, waste exchange, and recycling programs at your Iowa City operation. Recycle cans from the pop machine. Revised 11/15/06 Section 5: Community Involvement, Compliance with Law 5.1 In addition to your normal business activities, does your business contribute or have plans to contribute to the community through volunteer work, financial contributions, or through other means? Please describe. Yes. Right now 1 have three cancer patient customers that receive free wigs. 5.2 Has the business been cited or found to violate any federal or state statute or regulation within the last five years (including, but not limited to environmental regulations, payroll taxes, Occupational Safety and Health Administration laws, Fair Labor Standards, the National Labor Relations Act, the Americans with Disabilities Act)? If yes, please explain the circumstances of the violation(s). No. 5.3 Has the company or any officer of your company been involved in bankruptcy or insolvency proceedings during the past 7 years from the date of this application? If so, provide the details. No. 5.4 Are you or your business involved in any pending lawsuits? If yes, provide the case name of the lawsuit, docket number, and city and state where it is pending. No. Section 6: Summary of Required Attachments Check off each attachment submitted. If not submitted, explain why. [ x ) Business plan (if start-up business) [ x Balance Sheet (3 year historical if an existing business. Start-ups must provide a pro - forma balance sheet) [ x Profit and loss statements (3 year historical if an existing business, 3 year projection for start-ups) [ x 12 month cash flow statement (if the business does not expect to turn profitable within the first 12 months, provide a cash flow statement extended to the year the business expects to turn profitable) [ ] Description of fringe benefits provided to employees, if applicable [ x) Brief description of the education, technical and business background for all the persons listed under Management (Question #1.4) Revised 11/15/06 x Please provide the social security numbers for all the persons listed under Management (Question #1.4) If an existing company, copy of the company's quarterly Iowa "Employer's Contribution and Payroll Report" for the most recent quarter. Construction loans only: Cost estimates for construction and a statement of the source of any additional funds Include a list of any machinery or equipment or other non -real estate assets to be purchased with the financial assistance and the cost of each item as quoted by the seller. Include the seller's name and address. Upon review of a submitted application, the City reserves the right to request additional information in order to assist the City with its evaluation of an application. Release of Information and Certification NOTE: Please read carefully before signing I hereby give permission to the City of Iowa City (the City) to research the company's history, make credit checks, contact the company's financial institution, and perform other related activities necessary for reasonable evaluation of this proposal. I understand that all information submitted to the City relating to this application is subject to the Open Records Law (1994 Iowa Code, Chapter 22) and that confidentiality may not be guaranteed. I hereby certify that all repre- sentations, warranties or statements made or furnished to the City in connection with this application are true and correct in all material respects. I understand that it is a criminal violation under Iowa law to engage in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of procuring economic development assistance from a state agency or political subdivision. 4 If applicant is a proprie or or general partner, sign below. By: C Date: J c O If applicant is a Corporation, sign below: Corporate Name and Seal By: Attested by: Date Signature of President Revised 11/15/06 Signature of Corporate Secretary Q. 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O o O o 0 0 0 0 o O o O o 0 0 o O o O o 0 0 K a Z o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 io 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 > 4 �NmvNmnm - _-�RNFJNNRRNN��mmM�RRm�ma mom¢ w ............ 0 0 0 0 0 0 0 0 0 0 0 0 z o00000000000000 s m 000000a000000000000000000 > a �Nme��nm ��-�������'R��R�rR�NRRmmm�MmmRma U........................... 0 ............ s m z > a �Nme�mnm _ -- mRNNNNNc`PINNNR��Rmmf`�i��i�< s m m n nnnm� mm ��, eeee �RRnnRRR�����RRmmmmmC� �2 7!��2m o00 wo�-mm----mm---mm-m-m----m---------------- a LL z 8 a'n x z LL s a' o z o m s o 4¢' °' o z m", z k ) § �\ \ Ik \ ) & 3E {fk, =)k » 2 § {\}/ |\t$�=� �%) k<\ ;®£2tE)k»§/})122\ &&a:��` |#a° ®)\ ,®o {{ `kk»{ .�»=Ea3 2222 �� ��-EZ �(\}a±sue |\� $ -= s�- �k§7k{) a;\7" -° § ■e;««®@ - ■I000z_ �zol ƒf722 - / g r ƒ«o«E §� k / \ - , 2 . /. ■ 0 J f m # 1 SCHEDULE C I Profit or Loss From Business IOMB No. 1545-0074 (Form 1040) (Sole Proprietorship) 2007 ► Partnerships, joint ventures, etc., must file Form 1065 or 1065-B. Department of the Treasury Attachment Internal Revenue Service (99) ► Attach to Form 1040, 1040NR, or 1041. ► See Instructions for Schedule C (Form 1040). Sequence No. 09 Name of proprietor Social security number (SSN) FRANKI ELAINE COOLEY A Principal business or profession, including product or service (see the instructions) B Enter code from instructions 0- SALES OF HAIR CARE PRODUCTS D Employer ID no. (EIN), If any C Business name. If no separate business name, leave blank, ALFIES BEAUTY SUPPLY E Business address (including suite or room no.) ►4 0 0 KIRKWOOD AVE City, town or post office, state, and ZIP code IOWA CITY IA 52240 F Accounting method: (1) Cash (2) 1 Accrual (3) Other (specify)► G Did you "materially participate" in the operation of this business during 20077 If "No," see instructions for limit on losses . , ... N Yes No s H If ou started or acquired this business during2007, check here ......... . ............................ . .... . . . . . ... . ► ??;> Income 1 Gross receipts or sales. Caution. If this income was reported to you on Form W-2 and the i i "Statutory employee" box on that form was checked, see instructions and check here ... , , ..... ► a 1 17,535 2 Returns and allowances............................................................... 2 3 Subtract line 2 from line 1 4 Cost of goods sold (from line 42 on page 2) ......... . ........ . ....................... .... i 5 Gross profit. Subtract line 4 from line 3 ........................... . ... . ................... 4 14,157 5 3,378 6 Other income, including federal and state gasoline or fuel tax credit or refund (see instructions) ........ 6 7 Gross Income. Add lines 5 and 6 .. . ................................... . .............. ► 7 3,378 4 fit' -'If] Exoenses. Enter expenses for business use of vour home only on ling 30 8 Advertising ............... 9 Car and truck expenses , (see instructions) ........... 10 Commissions and fees ...... 11 Contract labor (see instructions) 12 Depletion ................. 13 Depreciation and section 179 expense deduction (not included in Part III) (see instructions) ............... 14 Employee benefit programs (other than on line 19) ...... 15 Insurance (other than health).. 16 Interest: a Mortgage (paid to banks, etc.) b Other .................... 17 Legal and' professional services c es 8 18 Office expense, ........... , 19 Pension & profit-sharing plans 20 Rent or lease (see instructions): a Vehicles, machinery, and equipment. b Other business property...... 21 Repairs and maintenance .... 22 Supplies (not included in Part 111) , . 23 Taxes and licenses.......... 24 Travel, meals, and entertainment: a Travel .................... b Deductible meals and entertainment (see instructions) 25 Utilities ................... 26 Wages (less employment credits).. 27 Other expenses (from line 48 on page 2)................... 18 9 19 20a 10 11 20b 8,000 12 21 13 225 22 23 24a 14 24b 15 25 6,437 16a 26 27 194 16b 17 28 Total expenses before expenses for business use of home. Add lines 8 through 27 in columns ..... ► 29 Tentative profit (loss). Subtract line 28 from line 7 .............. . ...:..'. I .... , ... I .............. 30 Expenses for business use of your home. Attach Form 8829 . .. ................................. 31 Net profit or (loss). Subtract line 30 from line 29. • If a profit, enter on both Form 1040, line 12, and Schedule SE, line 2, or on Form 1040NR,� line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. 4 28 14 , 8 5 6 29 - 11 , 4 7 8 30 31 - 11 , 4 7 8 32 IT a loss, you must go to line 32. If you have a loss, check the box that describes your investment in this activity (see instructions) • If you checked 32a, enter the loss on both Form 1040, line 12, and Schedule SE, line 2, or on Form 1040NR, line 13 (statutory employees, see instructions). Estates and trusts, enter on Form 1041, line 3. Iflf you checked 32b, you must attach Form 6198. Your loss may be limited. J 32a All investment is at risk. 32b H Some investment is not at risk. Paperwork Reduction Act Notice, see Form 1040 Instructions. Schedule C (Form 1040) 2007 07 C1 TWF 23968 Copyright Forms (Software Only)— 2007 TW irr"O'Ach 1, 0 &�l '�i e,v # 1 Schedule C (Form 1040) 2007 COOLEY Page 2 FDA 1 :: Cost of Goods Sold (see instructions) 33 Method(s) used to value closing inventory: a ® Cost b a Lower of cost or market c a Other (attach explanation) 34 Was there any change in determining quantities, costs, or valuations between opening and closing inventory? If "Yes," attach explanation............................................................ :1111.11, 0 Yes 35 Inventory at beginning of year. If different from last year's closing inventory, attach explanation ....... r36 36 Purchases less cost of items withdrawn for personal use ..................................... 37 Cost of labor. Do not include any amounts paid to yourself . . ..................... . .......... . Iim 19,851 38 Materials and supplies ...................... . . .. . ............... . ... . .............. 38 39 Other costs........................................................................ 39 40 Add lines 35 through 39.... .......................................................... 40 19,851 41 Inventory at end of year ....................................................... . ...... 41 5,694 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on page 1, line 4 ........ 42 14, 157 €'C€< Information on Your Vehicle. Complete this part only if you are claiming car or truck expenses on line 9 and are not required to file Form 4562 for this business. See the instructions for line 13 to find out if you must file Form 4562. 43 When did you place your vehicle in service for business purposes? (month, day, year) ► 44 Of the total number of miles you drove your vehicle during 2007, enter the number of miles you used your vehicle for: a Business b Commuting (see instructions) c Other 45 Do you (or your spouse) have another vehicle available for personal use? ............................... Yes No 46 Was your vehicle available for personal use during off -duty hours? ................. I .................. 0 Yes F1No 47a Do you have evidence to support your deduction? .............................. . .................. a Yes No is �i it is i OVA 07 C2 TWF 23989 Copyright Forms (Software Only)— 2007 TW Schedule C (Form 1040) 2007 r *�_:.® CITY OF IOWA CITYMEMORANDUM Date: April 10, 2008 To: Economic Development Committee 7V/// From: Jeff Davidson, Director of Planning and Community Development Re: Proposed amendment to Sheraton Hotel parking agreement The new owners of the Sheraton Hotel have proposed a package of incentives which will enable them to proceed with the rehabilitation and upgrading of the Sheraton Hotel property in Downtown Iowa City. One of the elements of their proposal is to amend the existing parking agreement between the Sheraton and the City of Iowa City. The Dubuque Street Parking Ramp was built in the late 1970s in conjunction with the downtown hotel, which is now the Sheraton. There has been a parking agreement between the hotel and the City since that time. The current arrangement with the hotel has them pay for the equivalent of 100 permits each month at the current rate, which is presently $65 per month. This creates an annual revenue stream of $78,000. For this, the hotel receives 60,000 "preferred rate" parking hours per month, or 720,000 hours annually. This works out to approximately 9.20 per hour, compared to the regular rate of 750 per hour. Under the current parking agreement for the past year, the Sheraton had an overage of 225,889 hours for which they paid the regular rate of 750 per hour. This resulted in an overage charge of $169,417. With the regular fee of $78,000 added, this resulted in total annual fees from the Sheraton of $247,417. An analysis by the Iowa City Parking Division showed that the overage was almost entirely due to employee parking. The previous hotel owner was comfortable paying the overage amount for employee parking because they felt they needed to provide an incentive for downtown employee parking in order to keep the hotel adequately staffed. The new owners have specifically asked for employee parking to be taken into consideration in their proposed amendment to the agreement. The new hotel owners have requested consideration of two alternate scenarios. The first is to go to 80,000 preferred rate parking hours per month (increase of 20,000) with additional special consideration for employee parking. The additional 20,000 preferred rate hours each month (240,000 hours annually) would cost the City approximately $158,000 annually. This is the difference in the regular rate of 750 per hour and the preferred rate of 9.20 per hour. The additional consideration for employee parking would likely be something along the lines of subsidized hourly parking or monthly permits. Permit parking in the Court Street Transportation Center, which is approximately 200 feet from the Sheraton, is $55 per month. The second scenario suggested by the new owners of the Sheraton is to go to an additional 40,000 preferred rate hours per month, or 480,000 hours annually. This would cost the City approximately $316,000 each year. It is expected that under this scenario the Sheraton would use preferred rate hours to pay for employee parking. In your discussion of this matter, and the entire incentive package for the new owners of the Sheraton, there are several points we would like you to take into consideration: April 10, 2008 Page 2 • There are many employers in downtown Iowa City who would like to have a special deal for employee parking. There are some employers who pay the full price for monthly permits and provide them to their employees as a benefit. After five o'clock p.m. and on Sundays, the Court Street Transportation Center can be used by the Sheraton free of charge. An idea which has received consideration, but not yet been considered by the City Council is to increase downtown parking violations from $5.00 per ticket to $7.00 per ticket. The University currently charges $7.00 per ticket for parking violations. The extra $2.00 per ticket could be earmarked for downtown -related incentives which could include the Sheraton. We estimate the $2.00 surcharge would create $100,000-$200,000 in revenue annually. Let's plan to discuss this matter at your April 22 EDC meeting. cc: Wendy Ford wpdata\PPDD I R\MEMOS\Sheraton-4-9-08.doc 2 r �.! CITY OF I O W A CITY z-- MEMORANDUM Date: April 17, 2008 To: Economic Development Committee From: Wendy Ford, Economic Development Coordinator Re: a) Proposed financial assistance for Sheraton Hotel b) Proposed easement vacation for Sheraton Hotel Proposed financial assistance for Sheraton Hotel The new owners of the Sheraton have requested City assistance to enable them to proceed with a major rehabilitation and upgrade of the Sheraton Hotel in downtown Iowa City. The new owners have an aggressive plan to invest $11 million dollars over and above the purchase price of the hotel. Much of the renovation cost is to replace critical building infrastructure such as the original 25 year old heating, air conditioning and ventilation system and the elevators. These renovations, along with other Sheraton brand standard requirements, have been deferred for so long that the hotel is seriously at risk of losing its Sheraton "flag" or brand name. If the hotel loses the flag, it would be detrimental to the value of the hotel because occupancy would begin to decline precipitously. Resulting implications are that the property value and assessed taxes would also decline, visitor -paid hotel motel tax collections would be reduced, as would parking revenue and the number of visitors and their spending within the community. Along with the building infrastructure, all of the hotel's furnishings, from carpets to beds and drapes, will be replaced and a completely new interior design plan will be implemented. Sheraton's new brand standards also require that all Sheraton hotels create an impressive lobby experience. Proposed easement vacation for Sheraton Hotel Regarding the lobby, the new owners propose that the City vacate the Dubuque Street easement that is now serving as a pedestrian walkway through the middle of the hotel. The public easement on this hotel property has been in place since the agreement was signed on December 12, 1983. In recent years, this pedestrian walkway has increasingly affected the success of the local hotel operation adversely. When the agreement was created to allow public access by the easement through the hotel, there was little problem with the 24 hour a day pass - through by pedestrians. Increasingly, and particularly over the recent years, there is more congregation of non -hotel guests in the walkway area and there are frequent fights among drunken revelers who are also not hotel guests. These fights are hazardous to all and create a negative experience for hotel guests, for which the hotel is ultimately liable. As an alternative pedestrian thoroughfare, the hotel proposes to enhance the existing City - owned Dubuque Street Walkway between the hotel and the Martini's Bar building directly to the west. Design plans will include a more prominent entry to the walkway on both the Burlington Street side and the College Street side, to add more lighting, security measures and public art. As a public easement, the hotel maintains the liability for anything that happens in that space. Along with the risk of personal injury, because of fights or weather -related slippery floors, the hotel has maintained the responsibility for maintenance of the many doors, some of which are automatic, and the frequent clean-up of human waste and weather -related water on the floor. April 17, 2008 Page 2 Additionally, the hotel is responsible for the expense of the heating and cooling of a public walkway, which, because of the volume of traffic, is substantial. Discussion You will have the opportunity to hear details and ask questions of the new owners of the hotel about the specific physical improvements they propose to make to the hotel and to the Dubuque Street Walkway. A preliminary set of concept drawings showing existing design and proposed changes to the walkway is included in your packet. In your discussion of this matter, there a number of points we would like you take into consideration: • A potential change in public access and its effect on the community. • The public safety issues associated with the existing 24 hour public easement and its adverse effect on the business. • The hotel will experience the greatest financial need in the early stages of its renovation as the owners incur costs to purchase new HVAC equipment, elevators and replacement of all the furnishings. • The hotel has requested tax relief through abatement, rebate or exemption. With any City financial assistance package, it is critical to understand how proposed improvements will positively affect property tax receipts, since these are the funds from which assistance is derived. The hotel is currently in discussions with the City Assessor so that staff may accurately estimate its value and the resulting property tax increases after improvement. We anticipate having this information within two weeks. Among the financial assistance options available are: o Tax Increment Financing (TIF) rebates, which are determined by figuring the difference between the hotel property tax bill before renovations and the property tax bill after renovations, and rebating a portion of that difference back to them. No less property tax revenue would acccrue to the City, County and School District than do today, and at a point determined in the future, the property owner would cease receiving rebates and the City, County and School District at that time would then gain the tax increment from the property improvements. 0 o Partial Commercial Property Tax Exemption, which is determined by figuring the difference between the hotel property tax bill before renovations and the property tax bill after renovations and exempting a portion of that difference from being taxed. o This option can be implemented two ways — 1) the amount of tax exemption (on the improvements only) is reduced each year in the following schedule: Year 1 ......... 80% Year 6 ......................40% Year 2......... 70% Year 7 ...................... 30% Year 3......... 60% Year 8 ...................... 30% Year 4......... 50% Year 9 ...................... 20% Year 5......... 40% Year 10 .................... 20% 2) by granting a 100% exemption to the value in the improvements for only three years. ...................... .................. ........... x. 0 0 c!) 41 Al Z J co cc 0 CD z x w Ile 1�- ui ui w co M 0 z u .47>��4 14 z LAJ Z 3: u ME V) u ui • Im= r Z X w I I IMP I _�._..,...o per ..�,�.,�_.�..-�� � _ ,..�..�,_,_�_-� ,.�..a.....__ .tom MUM . Iwo' Iwomwom mom +w�rw womb. �;• � � ..wro�'a "E�<si.°m���pa� � SYt�ti M�� a.R�'sa�YA�iR��`�R,S d tl'"�a ��a'���e'�''a �bts w dR ..... ... ...... .... ....... ... bA `� N d �.1Py A Ad66 � R a ��,� w) �+�b '4y Aa b •d � b"d :R '... .:% d Cnio .thy ts#R�%�3°�v�3ua�de�eSr� �� 1� 2�(aoRc ""R�w�u or �w�aMreu��`b 9 .y' y ) r w G FY N Ati `5 °A 4Sy b � yL 4a'd Pw �-wJ w�bd4 sA 4" bo .5 k.s % S �c s� � cS�"�` d sp�o� � �ss„ s ��fi3+°w����c�� �rb° ,ro Y� s �� P2gw ✓' sy s ., dR,.m °`,,yn�•'`d,� �r o.r���o �� e°.b��aa .,,,.,::°'^t,E...+�'aF4,,, . Y.aa2<e+ae'.�aa� , aFa°3`4_aw"'ad.a.. ,m°AkoA'%4C'.,°S .ob. 6,. �� �.,_, ,..:-' 3 m I M "---I h-, M fta i 0 was o wrirrwwr�wrw �' k t MIII�' ..,ova, MNOWAINUMMOMONWO If MNM** --------- WMr a01 M i'If � , I moo, �►awM �� M asMl N awls MMMMM�� lrAM�al�MinM MIM�MYawl mu m,$y j• Alt e 1 momOWN �0 . .. it d' ° �d y Ike yr i .° �.. m � -• °AF � ilP.dS° ��.. a�. _ G ?��F�� io i J �ro e13 3 Z a � � .F b � 0yy 0 V) LU U z Q ry z w Q J Q F- Q V) V) Q J (D z w U J V) z Q F- F- J U Q m IIIUI Ifll� f ll�ll� w w e j[J � M C r K R CC r CITY OF IOWA CITY MEMORANDUM -,%sun. Date: April 17, 2008 To: Economic Development Committee From: Wendy Ford �e_ Re: Additional Information on Towncrest Area Towncrest Area Ownership, Zoning and Total Area At your meeting on March 27, 2008, you desired to have more information about the makeup of the Towncrest area. Attached memo is a map of the area detailing the zoning types and property owners. The area bounded by the solid black outline on the following map totals 47 acres with 41 property owners. Towncrest Investments owns approximately 9.5% of the total area and is the only multiple property owner. Other significant tracts are owned by Michael and Debra Cooper, the owners of Town and Country apartments on the eastern end of the area, Hy Vee, Anita Gay Hartwig and Walgreens. The map also illustrates the zoning in the area. Inside the solid black outline there is a mix of commercial office (CO1), community commercial (CC2) and medium density multi -family (RM20) zoning. Property owners in this area have shown interest in rehabilitation of this area. Staff will prepare to conduct public meetings which aid in determining neighborhood goals and provide information about desires and challenges with the area. At the Economic Development Committee meeting, let's discuss 1) the boundaries of the study area, which may or may not coincide with the eventual redevelopment area, and 2) the potential goals of the council in the redevelopment plans for the area. cc: Jeff Davidson Bob Miklo Dover St. Carver St. Catskill Ct. ID 11PISIleD M_ R. 3ayn¢yetidnq�dyeiia� E x w c leiaunLq OM2�IC'f zz � x Willi eY ✓ ` s° >X X-i� � K� X. f ry /f Wade St. 4�1 k 8 First Ave. ire n .�>, oD u! . o U G chi ' � i ^U P ax_ '`, 1 `'^^ \� I o , Satu�el'^ _ w� x �� s is o I I Second Ave. -T] FT-�] F 1 1� F ► F_j I F I I