The Jefferson city council agreed to sell two city-owned properties and amended the lease on another at its regular meeting March 23.
Meghan Von Behren of Nevada introduced herself during the required public hearing regarding the sale of the property at 205 N. Wilson Ave, north of Angie’s Tea Garden. Von Behren is co-owner of The Funky Zebras boutiques in Coralville and Okoboji, and she plans to open another Funky Zebra in Jefferson.
The Funky Zebras sells women’s clothing, accessories and shoes, and some small gifts. Von Behren described it as “a small town shopping experience.” She hopes to open the shop in May.
Von Behren was the only one to speak at the public hearing. Council members had received one letter of support for the proposed sale of the building.
Details of the sale were not provided to the public at the council meeting, but the draft agreement was included in the council materials distributed prior to the meeting. The same packet was also provided to local media.
Sale price of the building is $93,000, the appraised value of it. The city is financing the purchase for Meghan and Jesse Von Behren as an interest-free, 10-year forgivable loan.
Also included in the package is a $57,000 forgivable loan for improvements to the property. The improvement project will include retail space on the first floor and an upper story apartment. The retail space must remain a women’s boutique for the duration of the agreement. The apartment must be made “habitable”, and must be complete within 12 months of closing the sale.
The agreement specifies there will be no abatement of property taxes on the building.
According to Jefferson city administrator Mike Palmer, the sale and development agreement is very similar to the agreement with Rosie and Ray Tucker for the building that is now Sensibly Chic (and the Tuckers’ home) on the south side of the downtown square.
The council also held a public hearing and then approved the sale of a vacant lot at 709 W. Lincoln Way to Eldon and Peggy Cunningham, owners of the adjacent property. City building and zoning coordinator Chad Stevens said the sale won’t add appreciably to the city tax roll, but the city will no longer have to mow it in the summer and remove snow in the winter.
The council approved an amendment to the lease with Heartland Bank for the building at 100 E. State St. The current lease ends Dec. 31, 2021. The amendment extends the lease in one-month increments for up to six more months. Heartland Bank is building a new office on N. Elm St; the amendment to the lease provides the bank a cushion should construction not be completed when expected.
Tim Oswald of Piper Sandler & Company reported on the sale of General Obligation corporate purpose and refunding bonds, and taxable General Obligation Urban Renewal bonds that was done that day.
Oswald said the sale was “decent.” Three bond series were sold. The interest rate for bonds sold to refinance previously-sold bonds was 1.76 percent (including all fees). Oswald said total savings to the city through the refinance will be $264,000. Savings had been estimated at $220,000 to $290,000.
Bonds for the city’s portion of construction of a new animal shelter went at 1.81 percent. Bonds for work in the downtown urban renewal district, to be paid with tax increment finance (TIF) revenue, were sold at 2.35 percent. Oswald explained those bonds are federally taxable for the investors, so that investor cost is passed on to the city selling the bonds. The composite interest rate across all three bond issues was 1.95 percent.
Oswald said he was “generally happy” with the bond sale.
The council passed the necessary resolution approving sale of the bonds and authorizing early redemption of those that were refinanced.
The council also held a public hearing on plans and specifications for the upcoming alley improvement project. The council then approved the required resolution to put the project in motion.
Four items regarding the FY2021-22 budget, including two public hearings, were taken off the agenda. Palmer referred to an email sent to council members explaining the need to delay those items, but no explanation was given at the meeting. The council will hold a special meeting to set the public hearings on the proposed property tax levy and the budget.
The state granted the city an extension to get the levy rate and budget approved and submitted.
Council member Harry Ahrenholtz gave residents a heads-up that sewer rates will need to increase to fund state-mandated improvements to the city’s wastewater treatment plant. He hopes to have the proposed rates available for consideration at an April council meeting. He said the increases will be “well within reach of most households,” and also called them “reasonable.”
The project won’t be complete until 2024, but starting a five-year plan of gradual rate increases will make financing the project easier and will spare residents a one-time large rate hike.
Council member Matt Wetrich reported the volunteer committee working to create a disc golf course at Daubendiek Park received a grant for half the cost and another $3,000 gift. Also, the walking trail at the park is under construction, with complete date on schedule for June 4.
The council recognized Dean Promes for 22 years of service on the Jefferson volunteer fire department. His tenure included eight years as second lieutenant and assistant chief. Promes said he is no longer available to serve.
The council also approved new fire department members Ben Campbell and Bryce Hoyle.
