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Waterloo addresses TIF matter in session

October 9, 2018

WATERLOO -- The Waterloo Common Council has voted to allow a city of Waterloo attorney and representatives, as well as Waterloo city Clerk and Treasurer Mo Hansen, the opportunity to negotiate a second amendment to a tax incremental financing developer’s performance agreement.

The agreement is between the city of Waterloo and Hawthorn and Stone Development, Inc. of Madison. The decision was made after the council returned from a closed session Thursday.

A number of council meetings and approvals, dating to 2013, have occurred between the city of Waterloo and Hawthorn and Stone Development, Inc. regarding property located at 333 W. Madison St.

In June of 2013, terms were outlined between the city of Waterloo and Hawthorn and Stone Development, Inc. for the purchase of property located at 333 W. Madison St. along with the demolition of the building structures, floodplain and remediation resolution research and discussion and construction improvements.

In December 2014, a resolution between the city of Waterloo and Hawthorn and Stone Development, Inc. regarding the sale of the property was approved by the Waterloo Common Council.

The property, which is located at the former RR Donnelley warehouse site, was then marketed as the future site of four assisted living facility and residential housing apartment buildings for the frail/elderly and mild-dementia population.

The warehouses were demolished and final site preparation for the construction by Hawthorn and Stone Development, Inc. was put into progress.

In October of 2015, the council approved the rezoning of land located at both 333 W. Madison St. and 467 W. Madison St. from manufacturing (M-1) to commercial (C-1).

“The rezoning would apply to the whole 12-acre parcel. The request is to have the whole 12 acres rezoned to C-1 and then there is a request for a corresponding conditional use which would allow for a dwelling unit to be on a level lower than the second level,” Hansen had said in regards to the rezoning request made by Hawthorn and Stone Development, Inc.

The 333 W. Madison St. property had already been marketed as the future site of an assisted living facility and residential housing apartment buildings for the frail/elderly and mild-dementia population and the 467 W. Madison St. property was marketed as a future site of an assisted living facility.

In November of 2015, the council approved a proposed certified survey map for property located at 333 W. Madison St. for Hawthorn and Stone Development, Inc.

“I want to point out that the certified survey map has been modified from prior versions that you saw in previous months,” Hansen had told the council in November 2015. “There are two parcels and the parcel that hugs the river’s edge -- roughly 75 feet from the river’s edge -- would become municipal property and would be deeded to the city as part of the project.”

In September of 2016, the council approved a quit claim deed to Hawthorne and Stone Development, Inc. related to then upcoming 2017 state Highway 19 road construction.

The quit claim deed applied to a 250-square-foot section of land that the Department of Transportation has requested to be deeded back to Hawthorne and Stone Development, Inc. to enable private negotiations regarding limited term easement and a right of way acquisition.

“In effect the city would deed back part of lot one which Hawthorne and Stone Development, Inc. deeded to the city. We are going to deed it back to them for a period of roughly 45 days so the DOT can finish their work and then Hawthorne and Stone, Development, Inc. will deed it back,” Hansen had said in September 2016.

In April, the council approved the authorization of a lawsuit in the event of failure to remedy notice of default for Hawthorn and Stone Development, Inc. for the property located at 333 W. Madison St.

“We have filed notice of foreclosure because they (Hawthorn and Stone Development, Inc.) haven’t acted on promises in the past and we just need authorization to proceed with this should they not remedy,” Mayor Robert Thompson had stated.

On Thursday, Janice Faga, chief executive officer, and Aaron Otto, chief operations officer of Hawthorn and Stone Development, Inc., met with the Waterloo Common Council after the council returned from closed session to discuss a possible amendment to the tax incremental financing developer’s performance agreement between the city of Waterloo and Hawthorn and Stone Development, Inc.

Otto informed the council that soil samples were taken at the end of September with results due back the second week in October and that phase one of the project has been completed, a lender has been secured and an estimated closing date of Oct. 19 had been established.

“For the building itself, we need to have the foundation in within the next 30-45 days because my understanding is the construction will be panelized, so it will go faster if it’s built off-site,” Otto said.

Panelized construction refers to “composed or prefabricated sections of walls, floor or roofs that can be assembled at the building site.”

“We’ve heard lots of delays from you guys, what’s going to be different? Or is this going to keep going on and on?” Alderwoman Angie Stinnett said in regards to Hawthorn and Stone Development, Inc.’s delays and lack of progression in the construction of the assisted living facility.

“We apologize for any misconceptions of the past and we are going forward in the future. We have the plans and the lender on board and that’s why we are here,” Otto said. “When we close, that clock starts ticking. We have to perform not only for the city but for the lender.”

Otto also noted that they are looking to “reap the benefit” of productive development and that issues and obstacles from the past are out of the way and Hawthorn and Stone Development, Inc. is ready to move forward.

If no future material changes are made within the developer’s agreement between the city of Waterloo and Hawthorn and Stone Development, Inc., the resolution does not need to be brought before the council again.

Otto anticipates a September 2019 completion date for the assisted living facility and residential housing apartment buildings.

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