Charles City Council ready to approve development agreement for ‘Birkwood Village’

By James Grob, jgrob@charlescitypress.com

The Charles City Council learned at Wednesday’s work session that the city is ready to approve a development agreement for a proposed 70-unit senior living facility in town.

Mark Holtkamp approached the city last spring with plans to construct a senior living facility east of the Floyd County Medical Center that will eventually house assisted living, memory care, skilled nursing, and separate independent living accommodations. The property will be accessible from both 11th Street and South Main Street. The facility will be called Birkwood Village.

The council passed a resolution in July adding the area at the southeast corner of the intersection of South Main Street and 11th Street to the South Grand Urban Renewal Area, meaning the project can use tax increment financing (TIF) from that district.

Holtkamp, a developer from Solon who has built other senior living facilities in western Iowa and Nebraska, has said the $13 million facility would serve senior residents through a combination of independent living, assisted living, memory care and nursing home rooms. Construction is expected to begin this summer and could take a year to 18 months to finish.

The city and Holtkamp tentatively agreed on a tax rebate incentive to help finance the project, which would return to Holtkamp 100% of the additional property taxes created by upgrading the property, for 10 years, up to a maximum of $2 million.

The tax rebates would start after the project is finished, and the package is constructed so it only impacts the city’s debt capacity one year at a time.

Public hearings on the Urban Renewal Plan and the development agreement with Holtkamp were held last summer, although the development agreement was not approved in July, as the legal description and platting work needed to be completed, and the 18-acre property still needed to be legally subdivided.

Charles City City Administrator Steve Diers informed the council Wednesday that the preliminary work is now complete.

“We’re now at the point where we can move forward with the development agreement,” Diers told the council. Diers said that there were no changes to the initial agreement that was heard in July.

“We did take some time to zero in on what the sustainable taxable value was going to be on that property,” Diers said. “Mr. Holtkamp and I, along with the county assessor, completed additional taxable valuation work, as it appeared the building would be valued higher than originally anticipated.”

Diers explained that the proposal calls for a 100% tax rebate over 10 years, which would generate somewhere between $1.7 million and $2 million in eligible taxes for rebate. The agreement provides for a total rebate of $2 million over 10 years, whichever comes first. Diers said that a minimum assessment agreement does not really fit this particular situation.

“Ultimately it was estimated that the building might end up with a higher value, which in turn would generate a larger increment that could be rebated,” Diers said. “Until plans are completed and ultimately the building built, it is hard to say exactly what the final value will be.”

Holtkamp said he would like to stick with the $2 million rebate, as he would not need to make any other changes or amend the Urban Renewal district. The agreement will be discussed and considered for approval at a future council meeting.

Diers also told the council that Holtkamp had successfully petitioned the state of Iowa to get permission to add nursing care beds for his project. Letters of support for this project came from CCArea Development Corp., Charles City Business Improvement Committee and Charles City Community Revitalization. Letters opposing the project came from Sue and David Ayers of Chautauqua Guest homes.

In other business at the work session Wednesday, the council heard from Chamber of Commerce Director Mark Wicks regarding a facade request submitted by Dr. Angela VanGilder for the building at 204 N. Main St. The project includes signage for the front and back of the building as well as the doors.

The building is owned by Cindy Uetz, and VanGilder is renting out a portion of it. Wicks told the council the design committee has reviewed this application and is recommending approval of this request for the requested amount of $564.08. VanGilder recently opened Cedar Soleil Med Spa — which provides aesthetic and laser services — in space provided by Main Street Drug.

The council also discussed Tony Lessin’s request for sanitary sewer service to a new home he is constructing in rural Floyd County east of the city’s corporate limits. At previous meetings, the council directed staff to prepare an agreement and forward it to Lessin.

Lessin is objecting to a requirement to agree to a future annexation beyond a 10-year period. Among other things, he also is objecting to any type of oversight, inspection, observation, mapping of the sewer system on his private property.

The council was sympathetic to Lessin’s objections but indicated that it would not adjust the provisions in the proposed agreement. Lessin said he would consider a compromise and get back to the council.

The council also discussed temporary easements, which are needed on both sides of the highway at the Charley Western Trail crossing as part of the Highway 18 HMA Overlay Project. No public hearing is required for action on the temporary easement, and the item will be voted on at the Jan. 19 meeting.

In another item regarding the Highway 18 Project, the council was informed that the Iowa DOT will replace the traffic signals at Clark Street and North Grand Avenue. A new pedestrian crossing signal will also replace the existing signal at F Street for Lincoln Elementary School. The agreements will be placed on the Jan. 19 meeting agenda for approval.

The council also discussed the demolition of property at 806 North Grand Avenue, which the city acquired last year. The council was told the existing house is in very poor condition and cannot be improved as a residential dwelling.

Plans are being made to demolish the existing house and detached garage, remove the basement and foundation, and leave a clean lot available for in-fill development.

Bidding documents have been prepared for this work and distributed to interested bidders for a demolition contract, and bids will be brought to the council at the Jan. 19 meeting so a contract can be awarded for the demolition.

In other business, the council was informed that city staff had reached out to Yorkshire residents regarding whether they would prefer their street to be known as boulevard or drive. Of the 26 homes that have a Yorkshire address, 19 residents responded to the survey. Of those, 11 prefer drive, five prefer boulevard, and three have no preference. Seven did not respond.

A decision on the name change will be on the agenda at a future meeting. If the council decides to use drive, action will be required, since the platted street name is boulevard. No action will be necessary if the decision is to continue using “boulevard” as the street name.