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Home My WebLink About1986-05-06 Info Packet of 4/25City of Iowa City MEMORANDUM DATE: April 25, 1986 TO: City Council FROM: Acting City Manager RE: Material in Friday's Packet Informal agendas and meeting schedule. Memorandum from the Acting City Manager regarding Urban Planning Division work program. Memorandum from the Acting Assistant City Manager regarding update on parking revenues and transit revenues. Memoranda from JCCOG: a. Update on activities of the JCCOG Ad Hoc Area Transit Study Committee b. Organization of 'remaining Committee activities c. Areas of transit service duplication Letter from the Chairperson of the JCCOG Rural Policy Board regarding the mutual aid agreement. Memorandum from the Department of Planning and Program Development regarding final report by•the Match Institution on the Iowa City/Clear Creek Development Charrette. Copy of letter from Mayor Ambrisco to the Airport Commission. Memorandum from the Airport Manager regarding operational costs. Legislative Bulletin No. 7, April 23, 1986. i I I M J/ -I ,J,; r- City of Iowa City MEMORANDUM DATE: April 25, 1986 TO: City Council FROM: Acting City Manager RE: Informal Agendas and Meeting Schedule April 29, 1986 Tuesday 6:30 - 8:30 P.M. Council Chambers 6:30 P.M. - City Manager Search Update - Jerry Oldani 7:00 P.M. - Planning and Program Development - Priorities and Staffing 7:20 P.M. - Transit Marketing Proposals and Systems Overlap 7:50 P.M. - Airport Compliance Project 8:15 P.M. - Council time, Council committee reports 8:30 P.M. - Executive Session - Litigation May 5, 1986 Mondav 7:00 - 8:15 P.M. Council Chambers 7:00 P.M. - Review zoning matters 7:20 P.M. - Administrative salaries 7:40 P.M. - Council agenda, Council time, Council committee reports 8:00 P.M. - Consider appointments to the Resources Conservation - Commission, Riverfront Commission, and Mayor's Youth Employment Board May 6, 1986 Tuesday 7:30 P.M. - Regular Council Meeting - Council Chambers PENDING LIST Annual Evaluation of City Clerk in Executive Session - May 13, 1986 Leasing of Airport Land for Commercial Use City Administrative Procedures Newspaper Vending Machines Stormwater Management Ordinance Review Hutchinson/Bayard Access Request. Economic Development Revolving Loan Fund Mesquakie Park Development Appointment to Riverfront Commission - May 20, 1986 i Wi -A� City of Iowa City MEMORANDUM Date: April 25, 1986 To: City Council From: Acting City Manager Re: Urban Planning Division - Work Program -7 Attached please find information regarding the Urban Planning Division work program which has been revised consistent with the directive from Council at your April 15 informal meeting. Estimates of staff hours for future projects and average hours per week for ongoing activities.have been included, along with estimated times for comple- tion of long range tasks. All items represent work which comes to the Urban Planning Division primarily from one of three sources: 1) the public on an ongoing basis, 2) the Planning and Zoning Commission, and 3) the City Coun- cil. Most involve projects which Council has discussed or has been made aware of and several remain on Council's informal pending list. The Planning and Program Development Director is requesting that Council address the relative priorities of these items and also indicate if there are any which the City should no longer pursue. In addition, Council requested on April 15 that staff address the question of filling the vacant position of Associate Planner prior to July 1, 1986. I indicated to Council on April 15 that the vacant position was one of seven eliminated by Council late last year. This was incorrect. However, there was discussion when this position became vacant and an understanding at that time that it would not be filled until FY87. Council discussed this matter at your informal budget meeting when the Department of Planning and Program Development budget was discussed. The current staff consisting of one Senior Planner and one Associate Planner will continue to address the ongoing activities and will attempt to address some of the future project ad hoc tasks, if and when time allows, during the remainder of FY86. However, only a very limited number of the ad hoc tasks will receive attention before FY87 if the position is left vacant. It is not anticipated that any long range tasks will be addressed before FY87. It should also be noted that in no event can the vacant position be filled much in advance of July 1 unless it can be filled internally. This may be possi- ble, depending upon whether or not one or more qualified City employees are interested. In any case, we will begin the process for filling the vacant Associate Planner position. If Council identifies a need to address certain of the ad hoc tasks and/or long range tasks prior to July 1, we can attempt to fill the position immediately. This decision should be made based upon Council's conclusions regarding the relative priority of all pending items. Ifo E This matter has been scheduled for additional discussion at your informal meeting on May 5, 1986. Staff will be present to address your questions or concerns at that time. Please contact me in the interim if I can provide any further information. cc: Don Schmeiser Karin Franklin bj5/8 U ,A� r City of Iowa City MEMORANDUM Date: April 25, 1986 To: CityC nc From: Don Sch Director, Dept. of Planning & Program Development Re: Urban Planning Division - Work Program After our discussion on April 15, 1986, the list of tasks for the Urban Plan- ning Division included in a memo dated March 14, 1986, has been revised to separate the tasks in the economic development area from the tasks in the area of land use (planning and zoning). Since the staff shortage is in the land use area, it should be easier and more productive to have the Council review only those projects in the affected work area; the economic development projects are listed for your information as part of the division's work program that need not be addressed by the Council at this time. The land use work program is presented in two lists - the on-going activities whack will be done as the arise (turnaround times may be extended if the application load increase thiSs and future projects which will not be completed s fiscal year. The Council should consider if there are any projects in the future tasks list which the Council wishes the staff to be in this fiscal year and if there are any projects which the Council wishes t program. The staff will be prepared to discuss any of the a aminate from the e the meeting if the Council wishes. We will specific tasks at need a consensus of the Council to eliminate any task or reorder the priorities presented. LAND USE WORK PROGRAM: On-going Activities: D Direct staff support for the Planning and Zoning Commission, Hours/Week the Board of Adjustment, the Urban Environment Ad Hoc Com- mittee and the City Council. - Process applications- 33-35 hrs/wk. Kitty Lee Subdivision 0 unSubdivision. Riverview Estates, Part 2CCounty Subdivision. Boyrum Subdivision, Part 3. Rezoning of 528 Iowa Avenue. Vacation and disposition of Teeters Court. LSNRD - preliminary plans for Lots 1, 3, and 6 BDI, Second Addition. Four applications per month for Board of Adjustment. - vacation and disposition of Hollywood Boulevard (associated with Pepperwood Place project). - Complete revisions to the OPDH ordinance. - Assist UEAHC in developing recommendations for buffers, entranceways and vistas. Em —A, r E o Review building permits for Zoning Ordinance compliance. o Respond to public inquiries - telephone 4-8 hrs/wk and office calls. o Draft miscellaneous 20 hrs/wk. correspondence in response to inquiries. 2 hrs/wk. o Respond to in-house inquiries and requests for assistance. o Administer the Urban Planning Division (meeting minimal administrative needs). 4 hrs/wk. 20 hrs/wk. Future Projects: r79Thr_S7wk. Ad Hoc Tasks: Hours o Amend Zoning Ordinance: 320-480 hrs. - Chapter 36-58 � parking requirements, physical limita- tions of the lot. Chapter 36-62, to address the issue of illuminated awnings. f illuminated - Chapter 36-69, special exceptions to - Chapter 36-56, noise generating equipment (air dify rconditioners). - Various other minor amendments to the Zoning Ordinance (20 noted). I o Annex Mormon Trek Boulevard right-of-way. o Evaluate parking requirements for16 fraternities sororities and hrs. and food preparation/delivery services. o Evaluate amendments to height requirements for accessory 40 buildings. hrs. o Evaluate amendments to provide for bed and breakfast 16 establishments. hrs. o Evaluate the leasing of airport land for commercial use 16 hrs. in the context of the Zoning Ordinance. o Vacation and disposition of right-of-way for 40 hrs. i Hutchinson/Bayard Street access request. Long -Range Tasks (FY87): 40 hrs. Time to o Update the Comprehensive Plan. Com tete o Work with the County planning staff on review and 12-18 mos. amendment of the Johnson County/Iowa City Fringe Area Policy Agreement. o Revise the subdivision regulations. 3 mos. 9-12 mos. r- Rl o Develop procedures for conditional zoning. 2 mos. o Coordinate and carry out the Stormwater Management Study. 6 mos. With reinstatement of a full staff, i.e. two associate planners in the land use area, we anticipate that all of the ad hoc tasks would be accomplished and the long-range projects would advance within the time frames shown. ECONOMIC DEVELOPMENT WORK PROGRAM: On-going Activities: o Staff support for the Design Review Committee and the City Council. I o Respond to public inquiries - telephone and office calls. o Draft miscellaneous correspondence in response to inquiries. o Respond to in-house inquiries and requests for assistance. - Assist the Public Works Department in the acquisition of easements and property in the relocation associated with the Benton Street Bridge pro- ject. - Continue to negotiate to acquire right-of-way for Foster Road between Prairie du Chien and Dubuque Street. - Assist in the acquisition of land and easements for airport compliance. o Draft agreement in principle for Clear Creek project. j o Coordinate redesign of the mini -park and monitor the Paul -Helen Building Project. Future Projects: o Provide staff assistance for the development of Parcel 64-1a. o Coordinate review by Design Review Committee of sidewalk cafe and newspaper j vending machine legislation. o Assist the Public Works Department in the acquisition of land for the sewage treatment plant. I o Assist the Public Works Department in the acquisition of property along North Dubuque Street for the Highway 1 project. i o Revise the City Plaza ordinance. o Update the Community Profile. o Provide the research and analysis for the economic development portion of the Comprehensive Plan. /sp _dA City of Iowa City MEMORANDUM Date: April 25, 1986 To: City Council and Acting City Manager From: Rosemary Vitosh, Acting Assistant City Manager`h6 Re: Update on Parking Revenues and Transit Revenues Attached are updated charts on I) Hours of Parking, for the City's Parking System and 2) Ridership, for the City's Transit System. The Hours of Parking chart differs from the chart prepared last September in that hourly parking for hotel customers is not now included in the figures on the chart. The hotel pays a flat fee of $3,250 per month for all parking, irrespec- tive of actual hours of parking used each month. At the end of the year, the hotel pays for any hours of parking used in excess of the maximum hours set by the hotel parking agreement. Therefore, monthly parking revenue from the hotel does not vary and the monthly hours of parking should not be included on the chart as they do not impact in any way on the total level of monthly parking revenues. PARKING SYSTEMS The Hours of Parking chart shows that parking in all months in FY86 are below the same months in FY85. From July, 1985, through January, 1986, hourly parking is lower than the prior year by 8%. In February, 1986, parking was 15% lower than February, 1985, and the month of March showed a reduction of 17% as compared to last year. Parking rates were increased effective February 1, 1986, and the increased parking ramp rates went into effect on that date. The parking meters could not be converted to the new rates until new meter parts were re- ceived; the actual conversion started late in February and is virtually complete at this time. Because actual parking usage has been lower than originally projected, the amount of revenue generated by the increased rates will be lower than the original projected additional revenue amount of $140,458 for February -July, 1986. Revised projections show that reve- nue from the increased fees, based upon actual parking usage now being experienced, will amount to approximately $127,000. This will result in a reduction of up to $13,000 in revenue available for transfer to Transit from Parking. The decrease in parking usage also means that Parking Sys- tems will have less revenue than originally projected to fund its own operating costs. The estimated revenue shortfall for parking is projected at $85,000 for FY86. It is too soon to determine what absolute effect the parking rate increase has had on parking usage. This is due to the fact that parking usage has been down all year and it is not unusual to experience a temporary de - Elm -I r� -2- crease in usage immediately following a rate increase. Actual data will need to be collected for a few more months before a definitive analysis can be made. Joe Fowler, Parking Supervisor, has responded to the reduced parking usage in the parking ramps by reducing the total hours worked by part-time cashiers by a total of thirty-one hours per week. TRANSIT SYSTEM Monthly transit ridership continues to be lower than last year's rider- ship. The FY86 fare revenue projection was adjusted downward midyear from the original projection of $996,688 to $817,683. Based upon ridership trends thus far this fiscal year, our current projections for fare revenue ahas been pproximatelyher reduc$25,000 in fared to revenue4. inThis thiswill fiscalsult n a shortfall of year. SUMMARY As a result of actual revenue being lower than originally projected for both Transit and Parking, Transit could experience a total new shortfall in revenue of up to $38,000 by the end of the current fiscal year (June 30, 1986). Finance will continue to monitor both Parking and Tran- sit revenues and report to Council monthly on their financial status. bc4 I =1'ay =1'ay CITY OF IOWA CITY HOURS OF PARKING FISCAL % CHANCE FROM I YEAR PRIOR YEAR TOTAL JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER I JANUARY FEBRUARY I MARCH I APRIL I MAY I JUNE 79 1,620,353 644,3810 84,247 116,213 154,233 147,733 151,380 122,160 b 1,732,470 141,440 118.747 129,193 148,013 141,663 157,499 131,668 154,405 150,685 163,044 140,405 1256.211 155.688 81 41 2,446.999 167,863 149,609 192,752 209,884 171,951 215,307 183,632 209,272' 238,158 257,013 224,295 227,263 a 32 3.221,070 948,4U 229.629 264,197 299,628 263,788 '310,459 190,409 264,073 306.BS1 304,607 262,754 43 15 3,691,912 274,211 276.489 321,836 340,374 303.535 344,044 274,761 284,315 328,279 332,049 302,067 315,892 94 16 4,305,891 318,725 325.532 384,862 393,539 379,195 355,379 327,189 38S.190 370,601 405.621 337.091 322,767 BS 3 4,449,360 342,829 346,846 393,339 458,561 411,032 411.579 326,734 381,324 407.750 366,783 316,512 286.071 K 320,740 334,125 351,158 414,356 354,884 376.773 315,661 323,216 337,989 *Wcawber bours Is totil of July thru Decewber as Individual worth total$ are not avallablt. -1 AL, r CITY OF IOWA CITY TRANSIT RIDERSHIP FI3CAi TEM 3 CHANCE FROM PRIOR YEAR TOTAL JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER JANUARY FEBRUARY MARCH APRIL 14AY JUNE 157,791 182,089 180,225 167.969 156,032 130,480 127,647 79 16 1,743,414 101,050 97,849 136,187 151,446 154,449 b IS 2,012,384 121,1190 117,025 156,995 192,865 187,424 166,956 193,312 231,159 202,362 184,711 135,791 121,692 BI 2 2,052,986 126,668 112,958 181,320 207,557 181,722 166,843 182,622 219,892 193,696 188,108 139,840 131,560 Q 12 2,303.681 135,114 124,916 188,633 211,371 195,364 189,797 230,524 253,768 242,358 223,635 158,937 149,214 Q 2 2,349,416 145,S52 14S,212 210,182 225,7% 230,903 200,873 213,616 246.463 221,528 210,278 157,256 141,767 N (3) 2,285.275 131,170 146,094 1%,221 211,080 207,828 208,553 225,129 242,351 230,189 201.348 152,416 132,2% es (6) 2.113,315 125,949 129.518 171,486 209,723 196,322 182.086 203,634 232,069 194,690 191,538 151,801 124,479 r 125,026 125,116 161,544 198,329 180,685 185,211 181,544 199,591 169,253 r Johnson County Council of Governments 410EMPrg[anS[ 1a',GC,/bVc52240 f r�0 Date: April 24, 1986 To: Acting City Manager and City Council From: Re: Jeff Davidson, JCCOG Transportation Plann�r �/ John Lundell, Iowa City Transit Manager Update on Activities of the JCCOG Ad Hoc Area tee Transit Study Commit - We have been asked by Chairperson Strait to provide the Council with an update on the activities of the JCCOG Ad Hoc Area Transit Study Committee during the past 2-1/2 months. This is the committee that was formed at the Council's request to examine certain area -wide transit issues which evolved from the Iowa City Transit Study last fall. Members of the com- mittee in addition to Chairperson Strait are Dave Ricketts, University of Iowa; Mike Kattchee, City of Coralville; Dick Myers, Johnson County; Phil Shive, Downtown Association; and Anne Rawland, citizen. Frank DePirro, President of AFSCME Local 183, and staff persons from each transit system and JCCOG also have participated. Following are the highlights of committee discussion thus far: Service area du lication b Coralville Transit, Iowa Cit Transit and CAMBUS. We wil be presenting a summary of this item to you at your in meeting on April 28. A summary of the committee's discussion is included in a memorandum (attached) from the Transportation Planner. Transit system consolidation. The issue of consolidating Iowa City Tran- sit, Coralville Transit and CAMBUS was last examined during the Iowa City Transit Study. The Ad Hoc Committee has reached a consensus endorsing the position that staff arrived at last fall, which shows that it is not presently advantageous for the three systems to consolidate. Major fac- tors in reaching this decision are: (1) that in spite of the recent financial problems encountered by all of the transit systems, the Iowa City -area systems are still among the most efficient and effective in the State; (2) the tremendous amount of local support for each system, and the eroding of this support if they were not autonomous, especially by the City of Coralville; (3) the widely ranging levels of transit service provided by each system; (4) the widely varying wage rates between sys- tems; (5) the existing high level of coordination between the three sys- tems; (6) extremely low administrative costs by Coralville and CAMBUS do not offer much potential for further savings if the systems were merged; (7) and the increase in the amount of deadhead mileage if the systems were consolidated. NM `1 -A, t- -2- Bus and Shop. A great deal of discussion has been held on this issue. Many of the concerns of the committee have already been alleviated by the Downtown Association, such as: increasing the $5 minimum purchase re- quirement to $10, making the Bus and Shop passes easier to acquire in certain stores, and alleviating the abuse of the Bus and Shop and Park and Shop programs which was uncovered by Iowa City Finance Department staff. A proposal was made to the City Council by Frank DePirro and Don Roth to combine the Bus and Shop and Park and Shop programs with a 40E merchant reimbursement rate for both programs. This was referred by Council to the Ad Hoc Committee, but has not received the committee's endorsement at the present time. Discussion by the Ad Hoc Committee is continuing on this issue. Marketing. Three University of Iowa students have been working with Chairperson Strait, the Iowa City Transit Manager, and JCCOG staff on developing marketing proposals for Iowa City Transit. Marketing funding proposals have also been developed by the Iowa City Transit Manager and JCCOG staff in conjunction with the Iowa DOT State Transit Assistance program. The various proposals are currently being evaluated and nar- rowed -down for implementation. Ad Hoc Committee discussion concurred with the staff position that marketing should not be undertaken without a reasonable expectation that it will be cost effective. The Ad Hoc Commit- tee determined that a marketing survey of Iowa City Transit riders (both existing and potential) would be advantageous, but it is unknown at this time when it will be undertaken because of the large expense and staff time involved. Committee members have also researched the placement of schedule information at various stops on each route and a centralized information center in the Downtown Transit Interchange. Advertising. A great deal of work has been done on this issue by Ad Hoc Committee members. Some of the marketing efforts being developed by the three University students pertain to advertising, and these are being finalized with the assistance of the Iowa City Transit Manager. The CAMBUS on -board bus advertising program has been expanded to include Coralville Transit and Iowa City Transit if they wish to participate. The sales person for this advertising program believes that the potential exists for Iowa City Transit to recover approximately $5,000-$10,000 per year from an on -board advertising program. Committee members also are exploring the potential for paid advertising on transit maps, schedules, and monthly passes. Organization of Transit Maintenance. Discussion was held on the unique arrangement of Iowa City Transit bus maintenance being organized under the It of Iowa City Equipment Division. Major issues involve the accounta- bility of bus mechanics to the Transit Department, the lines of comnunica- tion between mechanics and supervisors, and the chargeback rates used by the Equipment Division. The Equipment Division Superintendent appeared before the Ad Hoc Committee to describe the existing arrangement and provide his opinions. Valuable insight was also gained from the Coral - vi le Transit and CAMBUS managers, which have bus maintenance organized within their respective transit systems. The new Iowa City Transit Man- aer has been with ithecorganization ndiated that he forfseveral moreamonths,reers to maintin thesattwhitaus chotimeiheuntlhe has feels he will be able to make a recommendation on this issue. MJ =1� r� -3- The Iowa City community's transit responsibility to the disabled, and the Iowa City Transit far—epp�o�lic These items are scheduled for discussion at the�ld-Hd�mmit e�e�ng on April 24. Discussion of the commu- nity's transit responsibility to the disabled is expected to center around how this issue might be affected by potential reductions in Iowa City Transit service. The fare policy will be discussed as to its reason- ableness and effectiveness. of Iowa City Transit which extend beyond users of --- --------- .. ,uwa u,c irdnsic service. These items are sc e u e o e I cusse a e ay 8 Ad Hoc Committee meeting. Both items are being discussed in light of expected discussion by the City Council later this year on possible reductions in transit serv- ice. The Ad Hoc Transit Study Committee is in existence until June 5, 1986. The plan for the remaining term of the committee is to hold one more regular meeting on May 8, then spend the final three weeks in May preparing the final report of committee proceedings. The final report will be consid- ered for adoption by the JCCOG Board of Directors and presented to the City Council in June. The final report will consist of a synopsis of committee discussion on each of the issues we have addressed, and the committee's recommendation on each issue. We will be available at your April questions. /sp 29 informal meeting to answer any ♦ ' a r - Johnson County Council of Governments 410EMShmgrona WGC,-:.b.%ro 224C Fr i0 i Date: April 16, 1986 To: JCCOG Ad Hoc Area Transit Study Committee From: Jeff Davidson, Transportation Planner Re: Organization of Remaining Committee Activities The term of the JCCOG Ad Hoc Area Transit Study Committee will expire June 5, 1986. Chairperson Strait has expressed his desire to have the final report on committee proceedings produced by the June 5 deadline. I am therefore pro- posing the following schedule for the remaining activities of the committee. 4/24 Ad Hoc committee meeting: see enclosed agenda. 4/29 Iowa City City Council informal meeting: presentation of marketing proposals and system route map overlays. 5/8 Final Ad Hoc committee meeting: remaining pending items and other business. 5/9-5/23 Preparation of final report of committee proceedings by JCCOG staff. 5/24 Draft report mailed to committee members for review. 5/29 Committee meeting to discuss draft report and submit marked up draft report to JCCOG staff. 5/30-6/5 Final report produced by JCCOG staff. 6/86 Adoption of final report by JCCOG Board of Directors. 6/86 Presentation of final report to Iowa City City Council. The final report will consist of a synopsis of committee discussion on each issue we have tackled, and the committee's recommendation on each issue. Since I will be attempting to summarize the hours of discussion that have occurred over the past three months, I anticipate that there will be many comments on the draft report. There may also be differences of opinion regarding final recommendations of the committee that cannot be resolved and will need to be noted accordingly. Please bring any comments regarding this matter to the April 24 meeting. /sp i r Johnson County Council of Governments 410 E Mshu�gtcn& lata Gty, khtia 5224G r� 0i 0 Date: April 23, 1986 To: Acting City Manager and City Council From: Jeff Davidson, Transportation Planner .X/ Re: Areas of Transit Service Duplication Last fall during the Iowa City Transit study, the Council expressed concern over perceived areas of transit service duplication by Iowa City Transit, Coralville Transit, and CAMBUS. This is one of several issues the JCCOG Ad Hoc Area Transit Study Committee was directed by the Council to address. We have completed our review and discussion of this item and have been requested by Chairperson Strait to present our findings to you at your informal meeting on April 28. Briefly, our findings are: 1. There are five areas of transit route "overlap" which occur in the commu- nity: a. North Hospital (ICT, CT, CAMBUS) b. West Side Dorm Area (ICT, CAMBUS) c. Eastern Manville Heights (ICT, CAMBUS) d. Coralville Highway 6 Corridor (CT, CAMBUS) e. North Dubuque Street Corridor (ICT, CAMBUS) Although transit routes overlap in the above listed areas, the only true duplication of transit service is occurring in the North Dubuque Street corridor. In the other areas the intent of service is not duplicated. For example, in the west side dorm area the intent of CAI4BUS is to pro- vide transit service to this area. Iowa City Transit only passes through this area on the way to and from further outlying areas in western Iowa City. Iowa City Transit cannot provide dormitory service on the way to and from western Iowa City because there is not enough excess capacity on board the buses. 3. The intent of both Iowa City Transit and CAMBUS is to provide service in the North Dubuque Street corridor. CAMBUS is unable to serve the Iowa City Transit portion of this corridor because of time and capacity con- straints. It would also be a departure in CAMBUS policy to provide specific service to a non -University area. This matter is further com- plicated by the difference in operating policy between Iowa City Transit and CAMBUS. Iowa City Transit provides service to North Dubuque Street once an hour all year long. CAMBUS provides varying levels of service to Mayflower, ranging from four times an hour during the University academic session to no service during University interim periods. Iowa City Tran- sit North Dubuque route ridership is approximately 35,000 per year. CAMBUS Mayflower ridership is approximately 750,000 per year. HE `A� -2- 4. There are many specific examples of coordination and cooperation between the three transit systems to avoid service duplication. These include Iowa City and CAMBUS sharing the Hawkeye Apartments route, CAMBUS not providing service in east Iowa City until after 10:30 p.m., and CAMBUS not stopping the Oakdale bus at Coralville Transit stops. An ongoing forum, the JCCOG Technical Advisory Committee, currently exists for the discussion of transit service duplication issues as they arise. /sp cc: Don Schmeiser �]W -v; r Johnson County Council of Governments 410 E VV09J ington St Imc City, bwo 52240 rr 0i April 21, 1986 Mayor Ambrisco and City Council City of Iowa City 410 E. Washington St. Iowa City, IA 52240 Dear Mayor Ambrisco and the City Council: On behalf of the JCCOG Rural Policy Board, I would like to commend the Council's spirit of mutual aid as expressed through the recent policy decision allowing the Iowa City Fire Department to provide backup fire protection in unincorporated areas. Your community neighbors appreciate this cooperative action. The JCCOG Rural Policy Board also commends the considerable efforts ex- pended by two Iowa City employees in developing the mutual aid agreement: David Brown, Legal Department, who drew up the agreement and extensively reviewed its legal ramifications, and Art Kloos, Iowa City Fire Depart- ment, who has worked over the past two years through continuous discussion to achieve a consensus for the agreement among the Johnson County area fire chiefs. We would also like to recognize and commend the work and perseverance of JCCOG Community Assistance Coordinator, Melody Rockwell, in coordinating this project among the many parties to the agreement, their respective city attorneys and insurance agents. Our thanks to Iowa City Fire Chief Donner for his leadership in requesting Iowa City's mutual aid participation in unincorporated areas and to all the persons who contributed to making this 28E agreement a reality. Sincerely, Mayor Dave Roberts, Chairperson JCCOG Rural Policy Board tp5/6 8!/ _A� r City of Iowa City MEMORANDUM Date: April 17, 1986 To: City Council From: Patt Cain, Associate Planner/ Re: Final Report by the Match Institution on the Iowa City/Cl Development Charrette ear Creek The enclosed report summarizes the events and conclusions of the Iowa City/Clear Creek Development Charrette, funded in part by the City's grant for technical assistance for local economic development from the Department Of Housing and Urban Development and the Small Business Administration. The report was submitted by David Nesbitt, Project Director for the Match Insti- tution, in fulfillment of the work plan accepted by Council. The charrette was held in February, 1986, and resulted in a determination of "process steps" leading to implementation of the Clear Creek research park project. These steps and a tentative schedule are outlined in the final section of the report. At me ek wh the sers of tasksiseti out linrthee report.InvestmentUnlessmpany is the Counciledirectsit therwise,teCity staff will undertake the items necessary to draft an "Agreement in Principle" with Clear Creek for the research park project. Preparation of this agree- ment was requested by Council at its informal meeting with Clear Creek on October 7 and was delayed until the completion of the technical assistance project. bj3/4 t - FINAL REPORT IOWA CITY/CLEAR CREEK DEVELOPMENT CHARETTE February 19-20, 1986 Iowa City, Iowa Prepared by: Stephen H. Smith COMREAL Properties APRIL, 1986 David Nesbitt The MATCH Institution �' al -'A. TABLE OF CONTENTS I. INTRODUCTION . . . . . . . . . . . . . . . . . . . I II. THE DEVELOPMENT CONTEXT . . . . . . . . . . . . . . 2 III. THE ISSUES . . . . . . . . . . . . . . . . . . . . 3 IV. PEER EXPERT'S COMMENTS . . . . . . . . . . . . . . 6 V. THE CONSENSUS . . . . . . . . . . . . . . . . . . . 9 VI. THE SCHEDULE . . . . . . . . . . . . . . . . . . . 12 APPENDICES APPENDIX I A: CLEAR CREEK APPENDIX B: PARTICIPANTS IN CHARRETTE PROCESS j AND SYMPOSIUM SCHEDULE APPENDIX C: ALTERNATIVES FOR NCCEDCO'S REVOLVING LOAN FUND I• INTRODUCTION_ This final report has been produced in support of a Peer Expert Agreement as part of the HUD/SBA Interagency Agreement for Technical Assistance in Economic Development. The report �i reflects the results of a series of site visits to Iowa City; a series of discussions with City staff, the University and the developer; and a summary of a planning/development charrette held February 19 and 20, 1986. The charrette approach was used because it afforded all Parties of interest (University of Iowa, the City and the de- veloper) the opportunity to examine, discuss and understand the various demands and issues related to the development of an i Office Research Industrial Park on property owned by Clear Creek i Investment Company.j Further, the charrette process provided a � i forum for creating consensus over issues considered critical by the City of Iowa City and the developer. The Peer Expert P participating in the charrette process was Mr. Stephen H. Smith, president of COMREAL Properties of Miami, Florida. Mr. Smith, a member of the Society of Industrial Realtors, and a leading real estate broker in the South Florida community, was chosen because of his firm's active representation Of several major mixed use industrial parks, as well as represent- ing a number of major lending institutions. The charrette itself was held at,the University of Iowa College of Business Administration (see Appendix B for list of participants). While the University has no direct stake in 8/z rr I ' -"f I 2 the development of the Clear Creek site, the process and poten- tial tenants of the site may provide an impact on the various programs, activities and curriculum of the school. The report is divided into six sections providing back- ground and discussion of the essential agenda items. The re- ports final section provides a schedule of activities and re- sponsibilities for the two major actors (the City of Iowa City and the developer). This schedule reflects a reasonable assessment of both the Peer Expert and the MATCH Institution's opinion of j those items necessary to provide a benchmark for further invest- ment, planning and development decisions. II. THE DEVELOPMENT. -CONTEXT I Clear Creek Investment Company has acquired some 350 acres ± located in Iowa City and Johnson County. Two -hundred and ten (210) acres ± have been set aside for the development of a Re- search Office Park, with a small percentage of this acreage to be used for light manufacturing and warehouse distribution. The site can be accessed from a frontage service road which i runs parallel to Highway 218, an extension of Interstate 380. Further, the site is located North of Melrose Avenue, whigh cur- i rently provides direct access to University Heights and downtown Iowa City. The site is in close proximity to Interstate 80, a major east/west arterial, and potentially could be accessed from Coralville, a smaller municipality adjacent to Iowa City. There are no major developments in the immediate area of the property.. However, existing industrial and office park glut =1� t-� 3 development in Iowa City has occurred along the I-80 corridor and along Highway 6 east. The site is characterized by a rolling topography of hills and dales. Developable acreage appears to lend itself to a va- riety of building types and design challenges. The current thinking on site design contemplates a loop road system from the frontage road, with developable acreage be- ing maximized by the location of the interior road configuration. It should be noted that this design response was made in light of an existing zoning which required a minimum of seven acre lots. The newly created ordinance allows, within a Research Industrial Park, smaller lot sizes (2 acres); therefore, subject to the new Zoning Ordinance requirements for establishing a Research Devel- opment Park, a site plan must be created to reflect the current applicable regulations. The State of Iowa, the University and the City of Iowa City have, over the past three years, moved aggressively to initiate an economic development program which attempts to attract new business and promote business expansions in the state and, par- ticularly, in the Iowa City region. First Capitol Development Company, a non-profit public/private partnership, has been cre- ated to provide the coordination, promotion, and marketing sup- port for the regional economic development activity. III. THE ISSUES The developer, Clear Creek Investment Company, has acquired the site and completed a preliminary analysis of the development -I M1 4 opportunity. The process has taken over three years to reach this point (where the developer feels the project is feasible). Attached as Appendix A is the summation of the project to date as provided by the developer. The issues from the developer's perspective are as follows: 1. Infrastructure -- Water, sewer, access roads, and utility easements are listed as items at issue by the developer. The request, simply stated, is for a com- mitment from the City to provide these services to the site, subject to the developer obtaining commit- ments from potential tenants. 2. Inducements Tax abatement and other public sector incentives must be worked out prior to a full market- ing program, since these inducements will place the development in a competitive position vis-a-vis other communities. 3. Zoning -- Expressed as a concern to allow light manu- facturing as part of R&D activities. It is not clear whether the newly approved Research Development Park (RDP) zone addresses all of the developer's concerns. 4. Risk Calculation -- It is felt by the developer that i if the project had to absorb the infrastructure costs on the front end, the project would not be able to compete in the market, given current land prices and activity. Further, there is an expressed need to mini- mize front end investment at this time until the market can be tested. r - 5 The issues from the City's perspective are as follows. 1. Zoning/Regulatory -- If any annexation and rezoning will be requested, the comprehensive plan must be amended to incorporate the uses proposed. The new RDP zone is in direct response to the developr-ent opportunity. 2. Infrastructure Improvements -- The City has indicated it would consider the provision of infrastructure im- provements to the site. However, the question of cost, •phasing, and timing are essential in order to provide the City with sufficient rationale to move forward'. 3. Budget/Risk Calculation -- The City is not at this time in the investment business; therefore, the project can- not require a substantial amount of front end dollars in support of a concept. The City must have the proper assurances that, in fact, their public commitm ent will be compensated for. Given the current constraints of budgets, any scheduling, cost, etc. must be included in the process of approval required of capital projects. WAL I c� N1 IV. PEER EXPERT'S COMMENTS Mr. Stephen H. Smith, President of the COMREAL Companies, provided the group with the Industrial Broker's perspective. Several key points were made and warrant mention. They are: 1. The national market has experienced a tremendous flurry of activity in Class A Office and Research and Develop- ment space. The market is oversupplied with current demand for new space at only 50 percent of what is al- ready constructed. In weak markets the move -ins come from Class B and C users, who utilize leasing incen- tives and discounts to fill the vacancies. The "trickle down" affect:creates vacancies in the Class B and Class C space.1 In light of this, a strategy to recruit and/ or market new space, as described in the initial meet- ing, will have a difficult sell under current market conditions. However, regional penetration may be achieved if the assets of Iowa City are promoted (life style and quality of life, especially delineating the characteristics of the University). 1Classes of Office Space: The various classes of commercial of- fice space are rated on the basis of quality of building, presti- gious location, number and kind of ancillary services, e.g., on-site parking and proximity to retail amenities. The grading may move from prime or Class A space, usually newer facilities, through Class C which represents second story office space in older buildings and secondary or tertiary markets. Markets may be defined as those areas which obtain prime rental rates and because of the location, etc., are considered the top end of the market, e.g. location and ancillary services. uv� 7 -I 2. Given the pressures of the market, as outlined in Item 1, and combined with the fluctuations in the real es- tate business over the past 6-7 years, the nature of industrial development has experienced a change. The major difference is that real estate is now viewed as an asset item and resource, not as an expense item on corporate balance sheets.2 The transition, then, is that lenders and major institutions have begun to play a more active role on the development side. Typically, the lender has looked to the yield on their investment as their profit. However, now we see lenders joint venturing projects and providing a percentage of equity and mortgage financing. The separation of functions such as equity -investor, user, developer and mortgage lender are becoming less and less distinct. In light of the trend mentioned in Item 1, the market may demand an aggressive posture towards small businesses and lo- cal expansions as a means of filling space. This mar- keting decision will be influenced by how the Clear Creek project initiators respond to Item 3. 2Without going into a detailed analysis of industrial investment property analysis, suffice it to say that larger institutions have begun to act like smaller individuals or groups. They seek the high return of those entities who are looking for the combination of income flow and capital appreciation, e.g., the real estate value going up. To that end,where corporations have made equity investments as well as mortgage loans to a particular development, their portfolio of real estate may be leveraged just as any other smaller entity and enjoy the return on assets immediately. 8/;. 1-1 T i I 3. The consolidation of functions in the real estate pro- cess has forced a clearer delineation between those entities that simply aggregate the land, obtain appro- priate zoning, and reach the point where the property has appreciated as a result of its future potential and those entities that actually develop, market and manage the project. The return on investment is predicated on a relatively low land acquisition price and the creation of substantial value by virtue of a finished subdivision approval process. In this scenario the land -holding entity does not pre -service the infrastructure or other improvements;. The next user, the development entity, then concerns itself with the development and construc- tion of buildings, e.g., the direct marketing of the ground and improvements. The operating arrangements that evolve reflect real estate development/brokerage functions, but done on a fee basis. Thus the equity arrangement, financing arrangement, and internal devel- opment management arrangement all are predicated on a fee plus for service basis. The bottom line for the Clear Creek project is a thorough consideration of what role the present land holders seek to play in the development process. Further, at what cost does the project need to be pre -serviced? Without a consolidation of functions and a negotiated series of relationships, notwithstand- ing the fact that the ground is a beautiful piece of ground, the F&I F] project will have a difficult time getting started without a substantial front-end investment. Additional Items Prior to the final meeting on the issues, the City and University had a session on the trends in economic development and on specific ideas for consideration in expanding the City's program. (These are attached as Appendix C.) Clear Creek met with Stephen Smith to seek additional in- formation on the development options, risk analysis and process steps in continuing their development. I I V. THE CONSENSUS I The final session concentrated on further delineating the j i issues of the charrette and on determining a schedule of process j steps which, if complied with, will at a minium provide a clear j i sequence of events toward implementation. 1. The Developer -- The series of tasks necessary to reach a point of go, no-go decisions should involve the fol- j I lowing steps: a. Investment criteria of which role Clear Creek will affectuate, e.g., pre -servicing and finished lot, building sales, leasing and marketing. What the development team shall consist of, e.g., engineer- ing, design, brokerage, financing, marketing and promotion. r 10 b. Financing Model Analysis -- Risk analysis to in - elude current land value, improvement costs, equity requirements, development and permanent financing and internal management costs. c. Market Trend Analysis -- To include current market niche potential for expansions and new businesses, land value, construction costs, lease terms and mar- ket nuances that affect the phasing and promotion strategy. d. Design/Engineering Analysis -- To include conceptual redesign of the site development plan in light of i j the new Research Development Park Zone. Subject to this analysis, develop an analysis of water, sewer, paving, road improvements and other utilities, as they affect the economic risk analysis and provide the basis for the public sector expenditure calcu- lations. These items are not viewed as occurring in a sequential manner. The schedule of tasks and their phasing assumes simul- taneous activities. Note that items such as convenants, development criteria, landscape criteria and design criteria have not been included in this list of steps since it appears that several significant decisions must be made prior to moving to specific support docu- ments of the industrial development process. VOL 11 2. The City -- There are a series of items which are need- ed in order to initiate process commitments required of the City. They are: a. Assurances from the developer of the viability of i the project with regard to the development team, the sequence of events, and the process to be used, I including a description of the role the public sec - for will play. b. Review of the public improvements and their cost based on the schematic engineering completed by the developer or development team. I I C. Set out the steps for a comprehensive plan amendment, annexation, rezoning, and a projection of the time required. d. Subject to completion and consensus as a result of items a. and b., prepare a preliminary set of re- quirements to be the basis of a City/developer agree- ment. These requirements would include a schedule I of when projects can be considered for inclusion in the capital improvements program, what the improve- ments will cost, what resources can be used for financing the infrastructure, and if additional charges, fees, etc. are required to support the obligations. e. Review the site plan permitting processes to see if: (1) they are consistent with the new Research Devel- opment Park zone requirements; and (2) determine if 12 there are ways to reduce the time required for lA, permits in cases where potential clients may need an expedited process. Items c. and e. can be initiated without a specific re- sponse from the developer. Those two tasks are not dependent upon any specific project. VI. THE SCHEDULE The primary reason for this schedule is to assure that all parties to the process have the same level of expectations in terms of receipt of p product. You will note that the University does not appear specifically within the consensus section. It I is viewed as a critical resource, but not as a primary party for the success or failure of the development opportunity. First Capitol Development Corporation is also viewed in the same light, e.g., an excellent resource, but one which cannot, i because of itsublic p purpose, take a direct role in the devel- opment process. Please note that the two entities (University of Iowa and First Capitol) may be positioned to assist the promotion, mar- keting, and sales efforts of the development. The marketing efforts of the various University departments engaged in industry research and the cassette on Iowa City are viewed as positive reinforcing activities which, if used in con- junction with the specific marketing program of the site, pro- vides an impressive base for sales activities. r- 13 This schedule provides all parties to the process a means of evaluating their relative position in terms'of critical op- erational commitments. TIME PRODUCT PARTY RESPONSIBLE 45 days • Engineering analysis of Developer schematic redesign based on new zone • Cost basis established Developer/City on public improvements required 60 days • Internal Risk Analysis -- Developer - Role, responsibility, cost Developer Team and market basis • Regulatory process review City in light of permitting process and subdivision process ** • Go, No -Go -- Does the Developer project still make sense? What form will it take? 90-120 days • 120 days -on • Agreement drafts based on developer requirements for public improvements Seek and define the product/partner/buyer strategy based on the 60 day go, no-go decision. Marketing strategy • Support strategy and support for project • Capital budget process begins, subdivision process begins Developer Developer Developer University/First Capitol City/Developer ** All of the above subject to negotiation with respect to the tasks and resultant products. rtx =1'L, r APPENDIX A: CLEAR CREEK fa -I r - `l r- so NEB -I IA r ACTIVITIES OF CLIENT FIRMS • RESEARCH AND DEVELOPMENT • LIGHT PRODUCTION • ENGINEERING AND OTHER PROFESSIONAL SERVICES • COMPUTATION SERVICES • REPRESENTATION, DISTRIBUTION AND SERVICE • SERVICES TO NEW HIGH TECH ENTERPRISES • INDUSTRIAL LIAISON TO THE UNIVERSITY OF IOWA • OFFICES • HOSTING PROFESSIONAL- MEETINGS • LODGING, MEAL SERVICE AND RECREATION AS APPROPRIATE j =l� i ACTIVITIES OF CLIENT FIRMS • RESEARCH AND DEVELOPMENT • LIGHT PRODUCTION • ENGINEERING AND OTHER PROFESSIONAL SERVICES • COMPUTATION SERVICES • REPRESENTATION, DISTRIBUTION AND SERVICE • SERVICES TO NEW HIGH TECH ENTERPRISES • INDUSTRIAL LIAISON TO THE UNIVERSITY OF IOWA • OFFICES • HOSTING PROFESSIONAL- MEETINGS • LODGING, MEAL SERVICE AND RECREATION AS APPROPRIATE j =l� r i5 r- 7 m INDUSTRIAL SURVEY • COVERED. 5 DIVISIONS OF 4 LARGE COMPANIES IN CENTRAL, SOUTHERN AND EASTERN U. S. • INDUSTRIES COVERED WERE CHEMICAL, ELECTRONIC, ELECTRO -OPTICAL AND SEMICONDUCTOR DEVICES • FOUR • LABS, WITH EMPLOYMENT OF 3,589, HAD DIRECT PAYROLL OF $44,826 PER EMPLOYEE AND FRINGE BENEFITS OF 31 PER CENT: • THE 4 LABS PLUS ONE COMBINED LAB AND HIGH TECH PRODUCTION FACILITY'USED 246 SQ FT PER EMPLOYEE. TOTAL FLOOR SPACE IN SURVEY WAS 6,I37300 SQ FT. F t - DEVELOPMENT PROJECTIONS • 21 BUILDINGS • . AVERAGE AREA 1500000 SQ FT, BUILT IN 3 STAGES • CONSTRUCTION COST $60 PER SQUARE FOOT • 252 SQ FT PER EMPLOYEE • AVERAGE PAY $37,000 • 'FRINGE BENEFIT 30 PER CENT • ASSESSED VALUE 91.7 PER CENT OF CONSTRUCTION PLUS LAND COST • TAX RATE $27.60 PER THOUSAND ASSESSED VALUE `A r � ' ECONOMIC GOALS • '21 BUILDINGS •. $1959000,000 PROPERTY VALUE • 12,500 PERMANENT EMPLOYEES • $46490000000 ANNUAL PAYROLL • $139,000,000 ANNUAL FRINGE BENEFITS • $4,9009000 ANNUAL,- PROPERTY TAX I i r� t- CURRENT STATUS • LAND PURCHASED • SURVEY OF R & D PERSONNEL AND SPACE USAGE DONE • BUILDING, STREET, UTILITY .AND FLOODWATER CON- TAINMENT LAYOUTS MADE • INFRASTRUCTURE COST ESTIMATES MADE ECONOMIC GOALS ESTIMATED • ZONING MODIFICATIONS NEARLY COMPLETED • FIRST CAPITOL DEVELOPMENT, INC. ENDORSED • COORDINATION WITH UNIVERSITY. AND IOWA DEVELOP- MENT , COMMISSION CONTINUING • INFORMAL AGREEMENT IN PRINCIPLE REACHED WITH CITY COUNCIL • MARKETING PLAN DEVELOPMENT STARTED • PHASED DEVELOPMENT PLANNED =dk. 0 ell POSITIVE ATTRIBUTES I. LAND ,CHARACTERISTICS PROXIMITY TO UNIVERSITY OF IOWA SIZE -- UP TO 250 ACRES ACCESS TO I 80 AND I 380/F 218 CONVENIENCE OF AIRPORTS SOUTHERN ANCHOR OF CEDAR RAPIDS -. IOWA CITY CORRIDOR NEAR NEW ROCKWELL-COLLINS PLANT NATURAL BEAUTY -1k; POSITIVE' ATTRIBUTES II COMMUNITY CHARAC'T'ERISTICS CULTURAL AND INTELLECTUAL RESOURCES QUALITY OF CITY GOVERNMENT UNIVERSITY AND CITY INTEREST IN DEVELOPMENT ESTABLISHMENT OF FCDI GOOD SCHOOLS HOMES AND HOME SITES STATE CHARACTERISTICS IOWA WORK ETHIC QUALITY OF PUBLIC .SCHOOLS AND COLLEGES AVAILIBILITY OF EDUCATED PROFESSIONALS STATE INTEREST IN DEVELOPMENT r PROBLEMS CLIMATE SMALL INDUSTRIAL BASE HERE NOW INDUCEMENTS BEING .OFFERED - ELSEWHERE COST OF PAVING AND SEWER ECONOMIC STRESS DUE TO BAD FARM ECONOMY I -I -vlk� r - APPENDIX 8 PARTICIPANTS IN CHARETTE PROCESS AND SYMPOSIUM SCHEDULE r - I a, CLEAR CREEK/IOWA CITY SYMPOSIUM PARTICIPANTS Gene Marner, President, Clear Creek Investment Company Jack Stuhr, Vice -President, Clear Creek Investment Company Dan Schwitters, Treasurer, Clear Creek Investment Company Harry Wolf, Chief Financial Officer, Southgate Development Company Ralph Stoffer, Landmark Surveying and Engineering Ernie Zuber, Councilman, City of Iowa City Dale Helling, Assistant City Manager, City of Iowa City Don Schmeiser, Director, Department of Planning and Programming, City of Iowa City Patt Cain, Economic Development Coordinator, City of Iowa City Ray Muston, President, First Capitol Development Company Duane Spriesterbach, Vice -President for Educational Development and Research, University of Iowa Dick Pegnetter, Associate Dean of External Affairs, College of Business Administration, University of Iowa Bruce Wheaton, Director, Technology Innovation Center, University of Iowa David Nesbitt, The MATCH Institution, Washington, D.C. Stephen -Smith, President, Comreal Company, Miami, Florida =l� r CLEAR CREEK/IOWA CITY SYMPOSIUM SCHEDULE Stevens Seminar Room - Phillips Hall February 19, 1986 9:00 - 9:15 Coffee, introductions, material preparation, orientation to facilities. 9:15 - 10:15 SESSION I -- Clear Creek Overview The current status of the project to include the latest thinking, site plan, market and development approach, tentative issues of concern. 10:15 - 10:30 BREAK 10:30 - 12:00 Discussion of the project specifics. The objective of this session is to have all parties familiar with the intent and strategy of the develop- ment.' Further, the discussion should focus on setting the parameters and identifying those items which the developer feels "must" be addressed by the public sector in support of their project. The public sector repre- sentatives should be shaping their "must" items which will be discussed on Day 2. 12:00 - 1:30 LUNCH 1:30 - 4:00 SESSION II -- Development and Economic Development Specifics The group will break into two sections. Section A shall consist of those representatives from the Clear Creek development team and Steve Smith to discuss the process and marketing, promo, aspects of developing a research oriented/high tech industrial park. Section B shall consist of those representatives from Iowa City, the University and Dave Nesbitt to discuss economic development in general, but specifically what other localities around the country have done in support of their economic development programs. Please note that these sections are not lectures, but rather should be full discussions using the Peer Experts as resources for the discussions, e.g., the discussion may require the Peer Expert to carry the first 30-45 minutes on the subject matter and then open the session to discussion. 4:00 - 4:15 Summary of the day's issues and review objectives for Day 2 4:30 - 5:30 Social Hour ?lx r Page 2 February 20, 1986 9:00 - 9:15 9:15 - 10:30 10:30 - 12:00 12:00 - 1:30 Coffee and administrative notes for Day 2. SESSION III - Public/Private Commitments The discussion will focus on specific actions, concerns and issues required by both parties to move the project to implementation. Please note that these are process agreements, since we recognize that in some cases formal public approval must be sought in support of specific development actions. SESSION III Continuance (W/BREAK) LUNCH This is a working lunch and should reflect a summation of the material covered and the consensus developed to that point. The lunch shall also include those items which need further study or represent points where further discussion is needed. According to 'the terms of the HUD/SBA Technical Assistance Agreement, after completion of the Symposium the entire process and key points shall be provided in narrative form and a reasonable period of time provided for review and comment. To the extent that there exists proprietary informa- tion (financial, market/business contacts, special relationships), these shall be protected in the final report provided by The MATCH Institution. gt z r APPENDIX C ALTERNATIVES FOR NCCEDCO'S REVOLVING LOAN FUND* *NCCEDCO - NEW CASTLE COUNTY ECONOMIC DEVELOPMENT CORPORATION, WILMINGTON, DELAWARE M ALTERNATIVES FOR NCCEDCO'S* REVOLVING LOAN FUND December 7, 1984 Prepared under the SBA/HUD Joint Agency Agreement for Technical Assistance *NCCEDCO - NEW CASTLE COUNTY ECONOMIC DEVELOPMENT CORPORATION, WILMINGTON, DELAWARE 01j - of a =1J, INTRODUCTION Traditionally, Economic Development Corporations have utilized two basic methods for use of CDBG seed -.conies. These invol upi both a short-term and long-term approac-h to assisting small busi- ness enterprises. A. Loans (Guarantees) Many EDCshave provided direct loans, which theoretically pro- duced an interest income for the EDC, and was used as a short-term method of multiplying limited funds. The return of principal and interest provided;a continuing source o= new loan funds to assist an ever-increasing number of business applicants. i EDCs have achieved additional leverage by combining their di- rect loan activity and SBA's loan guarantee program to reduce the EDC's exposure and to increase the participation of the private marketplace. B. Investments Many EDCs have provideb equity capital for small business en- terprises and have viewed this approach as their long-term strategy for assistance. The EDCs have gambled on the long-term profita- bility and, therefore, increased value of the small business concern The best programs generally combine both loans and investments which permits the EDC to play a dual role of lender and investor on a case by case basis. Experience has shown, however, no miatter which approach the ZDC chose to follow, its role as a packager of loan/investment g/dL 2 ventures cannot be overemphasized. The experience indicates that almost every successful loan package has required substantial "hands on" assistance from the EDC staff. It is with this in mind that The MATCH Institution has re- viewed NCCEDCO's Revolving Loan Fund and is making its recommenda- tions. THE PROBLEM A common problem experienced by most owner -managers of small business firms is poor management, e.g., the inability to forecast and plan for cash needs resulting in a "cash crisis." The recent experience of local economic development corporations, MESBICS, and SBICs, is that 70 percent of their intake activity is related to "cash crises" clients.1 Further, the experience indicates that for 90 percent of these potential cliehts any assistance that can be provided, given the normal internal processing period, would be too late to save the business. The client profile have three things in common. First, they know their line of business. Their technical ability is first rate. Second, they are poor managers. In many instances, they fail to plan ahead because of their enthusiasm for the operating side of their business. Third, most of them feel that additional money will solve their problems. They think that a loan will pull them out of the red.2 1Survey of LDCs, MESBICS, SBICs, Field Investigations and Discus- sions, The MATCH Institution, 1984. 2Sound Cash Management and Borrowing, John Murphy, SBA Management Aids, November 1.016. 0/1- r - 3 The source of funds sought by most small businesses may be summarized as'follows: 1. Trade Credit --*provided by suppliers and usually acti- vated by a long operating history with the small business operator/owner. 2. Short -Term Credit -- provided by lenders or investors for cash flow needs such as payroll, inventory, and other ex- penses which are based on a projected level of sales or business activity. 3. Long -Term Credit -- provided by lenders, investors, pub- lic entities, for expansion of the operating plant, equip- ment or modernization. 4. Equity Funds -- provided by investors, SBICs, EDCs, and the venture capital industry,." While the particulars of each business assistance may combine one or more of the above, the "typical" case will in fact have one of these capital needs as part of the assistance proposal. THE OPPORTUNITY Based on the material reviewed, NCCEDO provides a full range of capital service needs. Moving from the revolving loan to the SBA 503 to the Industrial Revenue Bond program, at least three of the capital needs of business may be met. The exception being the provision of equity capital, which as yet is not part of the program. The issue though is that the revolving loan fund has not generated the activity it originally thought would be generated by I 4, � I r 4 small business concerns. The typical small business person can be described as having a net worth under $100,000 and a cash need for loans between $5,000 and $50,000. It is interesting that in a 1972 Business Loan Sur- . i vey of all national lenders 68.4 percent of the loans processed were under $25,000. This suggests that while the dollar amount for the revolving loan is correct, there must be something else which affects the market perception of the fund availability. Traditionally, EDCs have found that their client profile handle business concerns who need additional credit enhancement instruments for either expansion of trade credit or expansion of their short-term credit. We have attached a copy of a study done for SBA Responses to I the Small Business Administration's Federal Register Notice, Re- questing Small Business Comments on Credit Needs. The study found that one-fourth of the firms that responded indicated that interest rates are too high.3 The revolving loan fund, even after the provision of a blended rate, does not provide a low enough program rate -to make the money attractive to small businesses. This is especially true as the spread between the prime rate and the program rate is reduced. It has been our experience that a net effective program rate of 5 to 7 percent becomes very attractive to small business concerns. It is interesting to note that marketing of a revolving loan program is sometimes successful if the "blended rate" is promoted 3SBA Response to the Small Business Administration Federal Register Notice, p. 6. 1/a. 5 rather than the program interest rate or term. As a case in point the current NCCEDCO 's brochure on the program provides an illustration of how the fund works. .Using that illustration we find: Loan Application $60,000 1. Bank 36,000 Assume 13.756, 5yr. teim* Debt service @ $ 832.99/mo 2. NCCEDCO 24,000 @ 106, 10 yr. term Debt service @ $ 317.16/mo Available for Debt $1,150.15 Service The blended program rate for the 5 year term is 5.65 percent. How- ever, if the term of NCCEDCO's loan runs concurrently with the con- ventional term of 5 years, the effective program rate becomes 12.27 percent. Thus, by using the maximum term we can produce an attrac- tive blended rate so long as the•spread between prime and the conventiona� loan rate is reasonable. Subject to how the lender books the program loans (commercial, consumer, or mortgage) the conventional rate.will vary, therefore, it behooves NCCEDCO to have negotiated a program rate if they have not already done so. i NCCEDCO may want to consider, therefore, marketing its fund on a "blended rate" basis or may consider two additional ideas Which have been used by other EDCs. In both, the fund would be used as an additional credit enhancement vehicle in support of the small business concern. *7^'-erest is based on prime @ 11.25 plus 2.5 points g1.t a 3 1. Use the fund as an additional guarantee for the borrower by purchasing CDs with a participating lender. Based on the average size of dollar requests by potential small business clients a process may be negotiated to assist the lender in reducing his "perceived risk" with respect to the business proposal. As the original debt is retired the guarantee can be re- duced in a direct ratio to the amortization. Thts method could reduce 'the cost of the borrowing for the small busi- ness, e.g. provide a negotiated rate, and allow the re- volving loan fund to generate interest income during the interim. This approach could be used to meet the small businesses need for expansion of Trade Credit and Short - Term Credit and provide an additional vehicle for off- setting the need for equity funds. 2. Use the.fund as an additional lever to be combined with SBA 7a, or the SBA guarantee program used in conjunction with a participating lender. In this manner the lender would obtain a 90 percent guarantee from SBA and NCCEDCO funds would provide the risk reduction to cover the "gap" (between the amount needed and what SBA will guarantee). The combination described above could work with a CD de- posit relationship, although the 'maximum exposure for NCCEDCO can be reduced subject to the amount of SBA guar- antee negotiated. The above can be used to meet long- term credit, equity, and some short-term credit needs of potential clients. V- _� Fi SUMMARY None of the suggestions included in this report precludes the use of other programs NCCEDCO have in place, but rather, focuses on the provision of assistance to small business needs. i One factor that should be mentioned is the need to focus marketing material to the smaller client. The materials current- ly in use do not make a client distinction and, in fact, may be confusing if read by an unsophisticated business concern. For example, if the revolving loan fund is to be utilized by small business, then the brochures related to them should emphasize this point. Finally, we have attached the aforementioned SBA report, a study done for the SBA by Deloitte Haskins 6 Sells and Arthur D. Little, Inc. on SBIC's, and a table on SBA Guaranteed Loans. g0- I b, Fi SUMMARY None of the suggestions included in this report precludes the use of other programs NCCEDCO have in place, but rather, focuses on the provision of assistance to small business needs. i One factor that should be mentioned is the need to focus marketing material to the smaller client. The materials current- ly in use do not make a client distinction and, in fact, may be confusing if read by an unsophisticated business concern. For example, if the revolving loan fund is to be utilized by small business, then the brochures related to them should emphasize this point. Finally, we have attached the aforementioned SBA report, a study done for the SBA by Deloitte Haskins 6 Sells and Arthur D. Little, Inc. on SBIC's, and a table on SBA Guaranteed Loans. g0- r- CITY OF IOWA CITY CIVIC CENTER 410 E. WASHNGTON ST. IOWA CITY, IOWA 52240 (319) 356-5000 April 17, 1906 Mr. Joseph A. Tiffany, Chairperson Iowa City Airport Commission 1606 Morningside Drive Iowa City, Iowa 52240 Re: Airport Compliance Project Dear Joe: It is my understanding that the Airport Commission has received and is currently reviewing bids on the Airport Compliance Project contract. In light of recent City Council discussion concerning said compliance project and the development of the airport, I would respectfully re- quest, on behalf of the City Council, that the Airport Commission delay any award of contract on said project until such time as the City Coun- cil has had an opportunity to make a decision regarding the funding of said project. Sincerely yours, / William J. Ainbrisco Mayor cc: City Council's Terrence Timmins, City Attorney Dale Helling, Acting City Manager Fred Zehr, Airport Manager bj4/5 813 _'A� IOWA CITY MUNICIPAL AIRPORT 1601 South Riverskis Drive lava Cty. Iowa 52210 Office Phom (319) 358.5015 DATE: April 25, 1986 TO: CITY COUNCIL FROM: Iowa City Airport, Fred Zere, Manager RE: Operational Costs In response to your request for projected operational costa at the Iowa City Airport, I have prepared the following. Attached are the costs associated with the three phases presented in the Airport Master Plan. These costs are eligible for 90% funding by the FAA and were developed anticipating that the airport would be • developed in parallel with the needs and demand generated by Iowa City as it grows and air traffic as it increases. The critical factor for keeping the airport open is the condition and servicability of the surfaces on the airfield side of the airport. The costs for rehabilitating the runways and taxiway systems are shown in item U1 of Phase I and items #1, 3 and 5 of Phase II (see * attached) and total approximately two million dollars. The two million represents overlaying the runways and taxiways, but through a reconstruction approach the project could be accomplished for approximately 1.2 million. The reconstruction will need to be accomplished over the next six years or so depending on how well the concrete holds up. The estimated 1.2 million to keep the doors open works out to $200,000 per year. If we are not in compliance and not eligible for AIP (Airports Improvement Program) funding, we will have to bear the entire $200,000 per year for six years or more. However if we are in compliance with FAA reguiatiore 90% Of those costs can be funded by the FAA, reducing our costs to $20,000 per year (which we currently have in our Improvements Reserve to serve as matching funds for FAA projects). The approximate $300,000 tentative grant that was withdrawn by the FAA in 1983 provided for reconstruction of runway sections. Of the $300,000, approximately $200,000 was slated for the runway repairs, with the remainder to be applied toward the purchase of aerial easements in the clear zones. It appears that the FAA was planning to reconstruct our runways and taxiways over a period of time and the withdrawn grant was the first step in that process. If you have any questions please call me at 356-5045. Thank you. t- I PHASE 1 - 0 to 5 years ITEM TOTAL FEDERAL LOCAL PRIVATE 1. Rehabilitate runway 17-35 775,600 698,040 77,560 2. Construct taxiway to 30S,300 274,770 30,530 runway 35 3. Construct taxiway to 107,700 96,930 10,770 runway 30 4. Install taxiway reflectors 8,600 7,740 860 S. Purchase clear zone ease- 39,300 35,370 3,930 meats runways 17 and 35 (39.33 acres) 6. Purchase land for extension 241,700 217,530 24,170 of runway 6/24 (96.7 acres) 7. Construct segmented circle 13,200 11,880 1,320 and wind cone 8. Terminal area improvements - Building rehabilitation 25,000 - 25,000 - Apron expansion 154,000 138,600 15,400 - Auto parking expansion 3,000 - 3,000 9. Hangar area improvements - Hangar taxiway construc- 31,000 27,900 3,100 - tion - T-Hangars (10 units) 120,000 - - 120,000 - Unit Hangars 1501000 M 150,000 TOTAL PHASE I 1,974,400 1,508,760 195,640 270,000 F9 $/0 r - PHASE 2 - 5 to 10 years ITEM 1. Rehabilitate runway 12-30 2. Purchase clear zone ease - easements runways 12 and 30 (12.15 acres) 3. Rehabilitate taxiways and apron 4. Install MITL S. Rehabilitate runway 6-24 6. Install REIL and VASI-2 on Runway 6 7. Terminal area improvements - Building expansion - Apron expansion - Auto parking expansion 8. Hangar area improvements - Hangar taxiways - - T -hangars (10 units) - Unit hangars - Access and parking TOTAL PHASE 2 TOTAL FEDERAL LOCAL 367,900 331,110 36,790 12,200 10,980 1,220 124,500 112,050 12,450 51,600 46,440 5,160 687,800 619,020 68,780 30,000 27,000 3,000 40,000 - 40,000 112,300 101,070 11,230 6,000 - 6,000 31,000 27,900 3,100 120,000 - - 150,000 22.000 6.300 15.700 1,755,300 1,281,870 203,430 F10 PRIVATE 120,000 150,000 270,000 8/� I _,A; o, I _,A; r- PHASE 3 - 10 to 20 Years F11 1k� TOM LOLL PRIVATE I1'94 1. Extend runway 6-24, 990 ft. 1,943,800 19,700 1,749,420 17,730 194,380 1,970 2. Extend MIRL, ry my 6-24 Relocate REIL and VASI-2 20,000 18,000 2,000 3. 4. on r rA*y 6 Purchase clear zone ease - 21,800 19,620 2,180 runways 6 24 5. (30.75 acres) install YALS/Localizer on 250,000 250,000 6. runway 6-24681,600 Construct Parallel taxiway 613,440 66160 , - 7. runway 6-24 Install MITL 82,000 73,800 8,200 - 8. Terminal area improvements - Building expansion 78,000 78,000 22 810 - - - Apron area expansion 228,100 10,200 205.290 10,200 - - Auto parking expansion 9. Hangar area improvements - Hangar taxiways 72,600 65,340 7,260 - - 240,000 - T -hangars (.20 units) 240,000 300,000 - 300,000 - Unit hangars - Parking improvements 7 200 . 7.200 .WAL PHASE 3 3,955,000 3,012,640 402,360 540,000 F11 1k� r PUBLIC RETIREMENT BILL IRMOUCEO House File 2483, a bill relating to the administration and benefits for Public retirement systems, hes been introduced in the House as a co-sponsored leadership bill. Rep. Lovell Norland, House Majority Leader and Rep. Del Stromer, House Minority leader. The bill would increase the total maximum benefit for IPERS employees. The maximum benefit, now $11,000 for employees who earn $22,000 for five years, would increase by $1,000 a year in any year in which the actuarial report of the system indicates that the increased cost can be absorbed without increasing contribution rates to employers or employees. Covered wages could not exceed $40,000. The bill also provides that benefits would be calculated on the three highest years' wages instead of the five highest years' wages. It's estimated that the increase in the maximum benefit would cost government employers an additional $1 million per year, although this could be offset by reducing the payroll contribution rate and using the system's strong financial position to fund the increases. This reduction is not pert of the proposed bill although proponents of the legislation are saying that the employer share could be reduced by 0.15 and the employee share by 0.10. Amendments have also been filed to the bill which would change existing provi- sions of death benefits for beneficiaries of employees in service and for military service exceptions for chapter 411 cities. SENATE FOR17{ER ANENDS EARLY RmREmm BILL SF 2242, a bill relating to early retirement, has been further amended by the Senate and sent back to the House. As we reported earlier (Bulletin No. 6), the House had amended this bill to allow cities to set up a special tax levy and develop early retirement programa for local government employees. That amendment vas rejected by the Senate which removed the special tax language from the Nouse-passed version. The House has refused to concur in the amendment and returned the bill to the Senate. The Senate now has the option of recedingor insisting on its position. If it insists, the bill will go to a conference committee. HOUSE BEGINS Won On APPROPRIATION BIT]. The House will begin work this week on HF 2484, the state appropriations bill. In years past there -ere numerous bills dealing with the appropriations for various departments and agencies. Ibis year the entire state budget is con- tained in this one bill. Of particular Interest to city officials are provisions that -ill maintain municipal assistance, sewage aid construction revenue, transit assistance and liquor profit revenues for cities. The bill also restores monies and credits and personal property tax money. On the negative side the bill calls for charging a city for one-half of the coat of providing the ten -week course at the Iowa Law Enforcement Academy and authorizing cities to require an officer candidate who in enrolled in the course to reimburse the city for the charge. This new language is in addition to a charging of one-half of the cost of providing cognitive and 915 .IECEISEu:: LEGISLATIVE "'W BULLETIN am a. tt.v� es lalal zsasn Second Session, Bulletin No. 7 April 20, 1986 PUBLIC RETIREMENT BILL IRMOUCEO House File 2483, a bill relating to the administration and benefits for Public retirement systems, hes been introduced in the House as a co-sponsored leadership bill. Rep. Lovell Norland, House Majority Leader and Rep. Del Stromer, House Minority leader. The bill would increase the total maximum benefit for IPERS employees. The maximum benefit, now $11,000 for employees who earn $22,000 for five years, would increase by $1,000 a year in any year in which the actuarial report of the system indicates that the increased cost can be absorbed without increasing contribution rates to employers or employees. Covered wages could not exceed $40,000. The bill also provides that benefits would be calculated on the three highest years' wages instead of the five highest years' wages. It's estimated that the increase in the maximum benefit would cost government employers an additional $1 million per year, although this could be offset by reducing the payroll contribution rate and using the system's strong financial position to fund the increases. This reduction is not pert of the proposed bill although proponents of the legislation are saying that the employer share could be reduced by 0.15 and the employee share by 0.10. Amendments have also been filed to the bill which would change existing provi- sions of death benefits for beneficiaries of employees in service and for military service exceptions for chapter 411 cities. SENATE FOR17{ER ANENDS EARLY RmREmm BILL SF 2242, a bill relating to early retirement, has been further amended by the Senate and sent back to the House. As we reported earlier (Bulletin No. 6), the House had amended this bill to allow cities to set up a special tax levy and develop early retirement programa for local government employees. That amendment vas rejected by the Senate which removed the special tax language from the Nouse-passed version. The House has refused to concur in the amendment and returned the bill to the Senate. The Senate now has the option of recedingor insisting on its position. If it insists, the bill will go to a conference committee. HOUSE BEGINS Won On APPROPRIATION BIT]. The House will begin work this week on HF 2484, the state appropriations bill. In years past there -ere numerous bills dealing with the appropriations for various departments and agencies. Ibis year the entire state budget is con- tained in this one bill. Of particular Interest to city officials are provisions that -ill maintain municipal assistance, sewage aid construction revenue, transit assistance and liquor profit revenues for cities. The bill also restores monies and credits and personal property tax money. On the negative side the bill calls for charging a city for one-half of the coat of providing the ten -week course at the Iowa Law Enforcement Academy and authorizing cities to require an officer candidate who in enrolled in the course to reimburse the city for the charge. This new language is in addition to a charging of one-half of the cost of providing cognitive and 915 psychological exams for law enforcement candidates. Under the bill as cur- rently written, neither of these provisions would apply to hiring entities that are state agencies, only to cities and counties. The bill also provides for a transfer from the Road Use Tax Fund to the general fund of the state a total of $552,000 to fund salary adjustments for the comp worth legislation of last year. Assuming this is implemented, the cities would lose $99,351 or I8: from their share of the Road Use Tax Fund. This amounts to approximately 4,5c per capita that would be lost. City officials should contact their state legislators on both the road use tax transfer and the new costs mandated by the sharing of Inv enforcement academy costs. BOIISE ACCEPTS SENATE VERSION OF PUBLICATIONS BILL The House has concurred in a Senate amendment to HF 2350, an Act relating to publication requirements for titles, and sent the bill to the Governor. The league had been successful In attaching an 'amendment on the Senate side which removed sections seven end eight of the bill which would have expanded the current misdemeanor section of Chapter 618 and required cities to pay court costs and attorney fees. Sen. Al Miller (0 -Ventura) and chairman of the Senate Local Government Commit- tee as well as Sen. Fraise (D -Ft. Madison) and Sen. Lind (R -Waterloo) deserve special -thanks for their efforts on our behalf. SENATE RECEDES ON APPOINTMENT BILL Following several weeks of work, the Senate has receded from Its position on HF 2035, a bill relating to the appointment of police chiefs and .fire chiefs. By receding from their version, the bill has been re -passed as originally proposed by the House and sent to the Governor for his signature. SENATE RESUMES YORK ON INSURANCE BILL The Senate has begun the process of amending the House -passed version of SF 2265, the Tort Liability Bill. One of the first amendments filed to the House -passed bill would have removed that section of the bill which exempted cities from liability for licensing and inspection responsibilities. That amendment was defeated on a vote of 18-29. As of this bulletin the inspection immunity section still remains intact but action on the bill has been deferred with several amendments still pend- ing in the Senate to the House -passed amendment. WEIL'NI LIMITATION BILL INTRODUCED The Senate Ways and Means Committee has Introduced SF 2296, an Act relating to the movement of vehicles of excessive size and weight. As written the bill revises the definition of a special truck to increase the maximum gross weight registration from 20 to 32 tons. The special truck definition is also revised to disallow a motor truck modified by removal of a fifth wheel to be classified as a special truck. The bill also increases the weight limits on compacted -rubbish vehicles to 22,000 pounds on the rear axle of a two -axle vehicle, 40,000 pounds on tandem axles or transferrable auxiliary axle vehicles, and places a 60,000 pound maximum gross weight limit on these vehicles. The bill allows the State Department 'of Transportation to issue a permit for oversize vehicles and loads valid for all road systems. Operation under the all -system permit is subject to the same restrictions as annual permits. The $250 all -system permit fee is to be deposited in the Road Use Tax Fund. 0 0 I I �t ,4