No cash will be involved in sale, but building will return to tax roll
Downtown Jefferson may be the location of the next Funky Zebras boutique, which specializes in women’s clothing and accessories.
The Jefferson city council at its March 9 meeting set a public hearing for March 23 on the sale of the city-owned building at 205 N. Wilson Ave to RAK, LLC, with the intention of opening a Funky Zebras boutique..
The building was the first downtown building acquired by the city. It was given to the city by the owner, along with $5,000 for renovation. The council approved using $75,000 in tax increment financing (TIF) funds as a match for a Challenge grant for which Jefferson Matters: Main Street applied. The grant wasn’t funded; work has slowly continued on the building, which needed not only a new front, but basically a new interior.
The proposal is to sell the building to RAK, LLC for $93,000, the appraised value. The city would not recoup its rehabilitation expense, as the purchase will be via a 10-year forgivable loan.
However, the building would immediately go back on the tax roll as commercial property with no tax abatement. The building now generates no tax revenue.
Funky Zebras boutiques are located in Ankeny, Cedar Rapids, Clear Lake, Coralville, Grundy Center, Okoboji, Pella, Ames, Webster City, and Albert Lea, MN.
The city council set two other public hearings for the March 23 meeting. One is for the sale of a vacant lot at 709 W. Lincoln Way to Eldon and Peggy Cunningham for $250. Cunninghams own the adjacent property to the east. The city acquired the property through the Neighborhood Stabilization Program in 2009 for the purpose of demolishing the house.
The other public hearing is on plans and specifications for an upcoming alley reconstruction project. The project will include the west half of the alley between S. Chestnut St and Wilson Ave (north of the White House apartments), the east half of the alley between S Wilson and S Vine south of Companion Veterinary Clinic, and the alley between the post office and Slininger-Schroeder Funeral Home. Total cost of the project is $171,350. Actual construction cost is $140,350.
Bids for the project will be received March 31.
The council heard a presentation from Jim Unger of Unger Insurance and then approved renewing the city’s insurance for the year beginning April 1. The total premium is increasing 8.3 percent, from $210,603 to $228,079. Unger said he had anticipated an increase of 10-15 percent.
The blanket property value for city-owned buildings is unchanged at $34,963,003. The property loss deductible will increase from $1,000 to $5,000 per occurrence for wind or hail damage and remain at $1,000 for all other occurrences. The premium for property insurance is increasing from $61,623 to $66,863, even with the increased deductible.
Unger reported EMC Insurance paid $35,521 in property damage claims to the city related to the August derecho.
Worker’s compensation is the largest part of the total premium at $91,295, increased from $85,750. The city’s experience modification factor (based on work comp claims by city employees) decreases slightly on April 1, but the total payroll – another factor in the rate calculation – has increased about $131,000.
In other business, the city council approved the annual urban renewal (tax increment financing) report; approved a resolution authorizing the preliminary official statement for general obligation purpose and refunding of the upcoming bond issue; approved paying $5,941 of eligible expenses for the upper story rehab project at 200 E. State St; and updates to the city’s affirmative fair housing and equal employment opportunity policies and the procurement policy as it relates to Community Development Block Grant (CDBG) work. The project at 200 E. State St utilizes CDBG funds.
