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TIF comes to Iowa City Marketplace

BY NICK MOFFITT | NOVEMBER 19, 2014 5:00 AM

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The Iowa City Marketplace will now receive up to $1.75 million for improvements from the City of Iowa City.

The Iowa City City Council voted 6-1, with Councilor Jim Throgmorton casting the dissenting vote, to approve a resolution that approves the tax-increment financing from the city.

The money will go toward assisting Core Sycamore Town Center LLC with a $4.4 million improvement project to repurpose the site that Von Maur departed.

The TIF approval in part will bring new tenants Planet Fitness and Lucky’s Market to the area, said Jeff Davidson, the city director of economic development.

Davidson said the Marketplace is currently under contract with Lucky’s and Planet Fitness that is conditional on the $4.4 million in improvements.

Davidson said the businesses must be completed by 2017, which has recently changed from the earlier 2015 deadline.

With approval of the measure, despite some of the controversy behind TIF, councilors said investment in the area is important.

“This is a critically important economic, retail area in the city, and with Von Maur leaving, we still need to take care of the area,” Councilor Susan Mims said during the meeting.

Throgmorton said the area was also important.

Despite vocal support for investment in the area, Throgmorton said he wasn’t convinced the TIF was fully necessary.

“I’m not yet persuaded that the owners of the center need financial support to take actions that are already in their economic self-interest,” Throgmorton said.

“As long as these incentives exist, as long as the community wants to be in the economic game there is going to be demand for them,” City Manager Tom Markus said.

Markus said the developer had originally asked for more money, but the councilors said the current level was as much as they would provide.

Mims said it is essential to stay in the economic game if the city wants to increase their tax base and continue to provide the services the city does.

She said the information in front of them was enough to show a gap in financing, which prompted her yes vote.

The rebate will be structured over seven years, accounting for increases in property tax due to the improvements.

Davidson said the way the rebate works is the property tax, including the city and county portions are collected, and then partially returned to the developer as part of the TIF.

Part of the improvements would also increase pedestrian accessibility as well as improving the parking lot.

Davidson said the incentive will overall increase the tax value of the property.


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