DES MOINES, Iowa | The state economic development board on Friday approved $13.5 million in state financial assistance toward a series of proposed Sioux City projects totaling $134 million.
The Iowa Economic Development Authority Board during its monthly meeting Friday voted unanimously to give contingent approval to Sioux City’s Reinvestment District program application. The award provides the city with up to $13.5 million to be repaid through hotel-motel and sales taxes generated by the new and upgraded properties over a 20-year period.
The contingent approval of state financing is a significant step for the project, the application for which was submitted in March of 2015.
“It’s been a long time coming, so we’re very excited,” said Renae Billings, with the Sioux City Economic Development Department. “It’s been over two years working on all these projects, and we’ve had some great additions in the last few months. I feel like it’s stronger than ever, and over $134 million in investment in Sioux City is going to be pretty transformational for our community.”
Sioux City requested $13.9 million from the state program. Board members said if the last remaining proposed project, in Mason City, encounters more issues, the board could possibly award the remaining $400,000 to Sioux City next year.
Sioux City’s application features four big-ticket projects:
* A five-story, 150-room Courtyard by Marriott hotel that will adjoin the Sioux City Convention Center downtown. The project also includes renovations at the convention center and construction of a 140-space parking structure.
* An ag expo center in the city’s former stockyards area.
* Redevelopment of the former Warrior Hotel and Davidson Building into a combination hotel and residential/commercial/retail complex.
* Redevelopment of four former industrial buildings in the area of the 100 block of Virginia Street for residential and commercial use by Ho-Chunk Inc. known as Virginia Square.
The approval is contingent on construction financing and development agreements for the convention center hotel, Warrior/Davidson and Virginia Square projects, as well as documentation that the Ag Expo & Learning Center has raised $5 million in private fundraising and has construction documents and operational agreements put in place.
The ag expo center fundraising was of significant interest to the board during the discussion at Friday’s meeting. The project has raised roughly $3 million thus far, and a tentative proposal would have required a total of $4.2 million.
After expressing some concerns, board members asked Sioux City officials to pledge they will raise $5 million.
Board vice chairman Dave Bernstein, a Sioux City businessman, said the extra fundraising will ensure the projects have sufficient funding in case costs increase.
“My concern, living there (in Sioux City), is this goes before the city council, gets bounced down the road three times, then they finally tweak it, and then you guys end up coming back here in December to address something, and then that’s going to be harder,” Bernstein said.
“If the town can’t raise $5 million, maybe they’re not buying into the project,” Bernstein added.
Dirk Lohry, president of the ag expo center board, said he is confident the project will be able to raise another $2 million for the project.
“The fundraising is going to be a challenge, but now that we’ve got the (state economic development) board, the city and the recreational aspects (added to the ag expo center) behind us, I think we have a great product to sell, and I think that we’ll be very successful in raising that money, if not more,” Lohry said.
Iowa’s Reinvestment District program permits cities to establish zones of up to 25 acres where future hotel-motel and sales tax money can be diverted to big-ticket, unique projects designed to increase tourism and quality of life.
Bernstein abstained from the vote.
“It’s been a long two years to get to this point, and we can’t wait to see these projects get completed,” said Marty Dougherty, director of the Sioux City Economic Development Department. “I think it’s going to have a huge impact on the whole Sioux City and the whole community, the whole region, really, will benefit from this project.”
Sioux City Mayor Bob Scott told The Journal Friday that reaching this point after more than two years is a solid affirmation for the project, which he said will significantly impact the city for years to come.
“I don’t see how else you can do what Ho-Chunk has done, what the Warrior-Davidson building possibility is, and -- whether you’re for or against them -- that hotel by the convention center and the ag center," he said. "These types of projects certainly should have a long-term benefit for the downtown and as a whole benefit the community."