Council moves ahead with residential development project

OTTUMWA — The Ottumwa City Council approved a development agreement with Kading Properties to turn 30 vacant lots into future residential housing during Tuesday's meeting at Bridge View Center.

The resolution passed on a 3-1 vote, with Doug McAntire casting the lone dissenting vote and council member Keith Caviness being absent.

When Kading Properties, which will operate these units as Twentyone Properties LLC, presented its vision of the project to the council two weeks ago, nothing had been discussed in the way of a development agreement, and what the city would pay as its part of the agreement. That was revealed Tuesday, with the city paying all of the abstracting cost, rather than just the first $500, which was the city's goal.

"I want people to know that I'm for this, but I'm not for them changing after two weeks and wanting to pay us more," McAntire said before casting his vote. "I just want to be clear on that."

City administrator Philip Rath clarified to McAntire that the development agreement was still being ironed out between the city's attorneys and Kading when the company made its presentation, and there was some "give and take" as a part of the process.

"I completely understand what council member McAntire is saying, but I think last they were talking about the concept of the project and they didn't have the final draft," Rath said. "We weren't approving the development agreement last time. It was just a concept, and they were still negotiating."

Kading will conduct individual surveys of each lot, which will consist of any combination of duplexes, triplexes, quad-plexes or single-family homes, and then will request the city to order abstracts for those lots, and each unit will be rented out. The city won't be ordering 30 abstracts at one time.

The project also is contingent on Kading securing workforce housing tax credits through the Iowa Economic Development Authority, as well as using the city's Build Ottumwa incentive that encourages development by offering a $10,000 grant to anyone completing a new single-family home valued at more than $125,000.

Along with that incentive, the company could take advantage of the city's residential tax abatement program, in which taxes on new value are abated for three years, and then the city would collect 100% taxes after that. There is no tax-increment financing associated with the project.

Zoning and housing coordinator Jake Rusch said the developments would be done over three years, but Rath said there may not be a set number each year.

"So it might be they purchased eight lots the first year, 14 the next year and the remainder the third year," Rath said. "It depends on their availability and their scheduling."

Council members Bill Hoffman Jr. and Cara Galloway both wanted clarity on whether Kading will continue the project over time and construction won't grind to a halt.

"You don't want to have a bunch of construction that's just going nowhere and just sitting there. That was a concern I had, that they would keep going and not come to a sudden stop and then it's an eyesore," Hoffman Jr. said.

"My understanding was that their idea was to have multiple projects going on at once, so they could have a bigger crew, hopefully local crews, where they could kind of go from working here to there," Galloway said. "It wasn't just going to be like one, and then one was waiting."

Rath reiterated the pace of development would be based on available manpower.

"So they would leverage the skilled work they have," he said. "So if they needed electric work done, they might have four or five homes done at once for the electric. But it's to their benefit to have them completed and rented."

The lots, located mostly north of the Des Moines River, used to have structures on them but the city was able to condemn them as necessary. The goal is to fill those lots with "missing middle" housing that is affordable for a large swath of residents.

"Those lots aren't doing anything for us now, other than that we mow them. So this is a big deal," Rusch said. "Right now, we're losing money on them."

In other business:

— Resident Jerry Phillips addressed the council at the end of the meeting to discuss the possibility of adding golf cart standards and regulations to the city's code. He cited a section of Iowa Code that deals with golf carts, as well as what other regulations communities had on their books.

"I recently spoke with police chief (Chad) Farrington and (fire) chief Pat Short regarding this proposed change in laws, and they stated they are open to this change," Phillips said. "There are several people in favor of that."

The council couldn't take action because the discussion was not on the agenda, but council members expressed interest in a work session to talk about it. Mayor Rick Johnson mentioned the city's ATV/UTV ordinance, and wondered if golf carts have headlights on them as well.

"They have lights, horns, turn signals," he said. "I've done a lot of research with municipalities around the state. Pleasant Hill has adopted state's guidelines, so has Williamsburg."

Hoffman Jr. credited Phillips for having done his research.

"Jerry did this with all his ducks in a row. The first thing he started talking about was safety, and there are a lot of people here supporting him," he said. "I wish more people who had a cause would do that."

— The annual Memorial Day festivities will be Monday at the Jimmy Jones Shelter at 10:30 a.m.

— The third annual Ottumwa Pride celebration will be June 1 in Central Park.