DES MOINES -- Anxious with how long the process is taking, Iowa's economic development board on Friday implored Sioux City officials to accelerate private fundraising if they still hope to land $14 million in state tax credits for a series of big-ticket downtown projects.
“I think the groups that all want this to happen need to step up and realize that there’s a short leash on this thing, otherwise it’s going away,” David Bernstein, an Iowa Economic Development Authority Board member from Sioux City, told city economic development officials Friday at the board’s regular meeting.
Sioux City in 2015 was selected as one of five projects to receive financial assistance through the state’s reinvestment district program. Sioux City is seeking $14 million to aid the $70 million project, which would include an upscale hotel convention center, an ag expo and learning center and the redevelopment of some buildings in the 100 block of Virginia Street into apartments and commercial space. The latter project, called Virginia Square and developed by Ho-Chunk Inc., is partially finished, with other segments nearing completion.
Reinvestment district organizers also are eyeing a second hotel within the designated district, either a new hotel adjacent to the proposed Bomgaars Ag Expo and Learning Center or a substantially renovated hotel nearby -- or a less likely scenario including both options.
City leaders confirmed Friday they have been in talks with the new owners of the Holiday Inn at 701 Gordon Drive. The venerable hotel is planning renovations to its guest rooms and lobby, and is replacing its former Charlie's restaurant with a Bar Louie, a national chain. Adding the Holiday Inn to the city's reinvestment application likely would require expanding the district's boundaries.
Ag center organizers have preferred an offsite hotel because they want more parking for patrons and exhibitors. Alternative ag center designs, however, offer the potential acquisition of nearby city-owned property that could free up additional space.
But, nearly two years after the IEDA's initial reinvestment selections, projects in Sioux City and Mason City have not yet been granted final funding awards as various pieces of the projects continue to be held up.
The Sioux City project still is without some development agreements, plus final design plans and more private fundraising for the ag center, which would be built at the site of the former John Morrell pork plant.
Those things are holding up final approval of the state funding, IEDA board members said Friday.
“My advice would be, if you can get the agreement signed with the developer or the management group and kind of get some of these things moving, it’s going to show good progress to ... all of us that things are moving in the right direction, because right now they’ve just been stagnant for a long time,” board member Christian Murray told Sioux City officials.
Roughly $3.2 million of private funds have been raised toward the original goal of $4 million to $5 million, and the ag expo center design is completed “to the schematic level,” said Sioux City Economic Development department director Marty Dougherty.
Dougherty said ideally he would be back for next month’s regular board meeting to seek tentative approval, but he conceded the April meeting may be a more realistic target.
He said the city has selected a developer for the convention center hotel and have an agreement, but they have not yet made it public and the City Council must still approve it. He said the developer is ready to start building in the spring.
Bernstein, a Sioux City businessman, encouraged officials to move the process along, and encouraged businesses and organizations that stand to benefit from the project to get involved with fundraising.
“I think if folks want an (ag center) in Sioux City, they need to step up and show that they want to support that,” Bernstein said. “And really, if you look at projects in Sioux City, which of course I’m familiar with for obvious reasons, raising $5 million for a $15 million facility is on the low end of something that even would have happened 10 or 15 years ago. There’s many, many projects in Sioux City of that scope that happened over the last decade or two that have raised significantly more privately.
“So figuring out a way to raise enough money privately and publicly to run this thing, which I think is part of the impediment, is key to getting it done.”
After Davenport withdrew its application last year, projects in Coralville and Grinnell were granted final funding.
Bernstein said the board is anxious for the Sioux City and Mason City projects to proceed to a point where the board can award the set-aside funds.
“It’s lucky that you have this windfall from potential state and other funds. But it’s a golden opportunity for Sioux City, like any other community that’s gotten these reinvestment districts. There’s a lot of money here. It’s like Vision Iowa with the arena in Sioux City or the arena in Des Moines,” he said. “It’s kind of a once-every-so-many-decades kind of opportunity to capitalize on, but you have to capitalize on it.”
Journal staff writer Ian Richardson contributed to this story.