OTTUMWA — Two weeks after entering an agreement to build a new hotel next to Bridge View Center, the Ottumwa City Council is beginning the initial stages of another project.

During Tuesday's meeting at City Hall, the city will set Nov. 2 as a date for a public hearing to begin the process of turning Bonita Avenue just east of Highway 149 into an urban renewal area so a 108-unit housing development can be built.

Huegerich Construction had been in contact with the city a few months ago regarding a project, and is interested in a tax-increment financing rebate (TIF), on a housing development. However, it would only be TIF-eligible if the 10-acre area for the development is declared an urban renewal area.

The proposed development is already zoned as multi-family residential, and would fit housing needs according to the 2040 Our Ottumwa Comprehensive Plan. The development would be "low-to-moderate income housing," and would charge $979 per month for a two-bedroom unit and $1,131 per month for a three-bedroom unit, according to federal Housing and Urban Development guidelines.

Not only is a housing development in the proposed plan, but so is repair on Bonita Avenue as a result of housing construction. An estimated cost of repair would be $250,000, and the city wants to use TIF from the development to find the repairs needed.

No taxpayer or general fund money would go toward the projects, as the TIF rebate would be up to 100% of the incremental property tax, not exceeding $3.5 million over 20 years.

Also, according to a staff summary from the city, JBS played an integral part in landing the developer, and "sees the need of retaining workers and providing an opportunity for future residential development."

Prior to the council meeting, there will be a board of health meeting to discuss condemnation of structures at 209 W. Fifth St. and 236 Phillips St.

In other business:

• Indian Hills Community College President Matt Thompson will speak before the council regarding the bond referendum that would allow for significant upgrades to both the Centerville and Ottumwa campuses. Thompson last week spoke to the Wapello County Board of Supervisors, who expressed their support for the referendum. The $28 million referendum will be on the November ballot.

• The council is expected to pass a $275,000 design contract with Willett Hoffman & Associates for a new HVAC system at City Hall. The scope of the project includes renovating the first floor of the building, bringing restrooms up to ADA compliance as well as installing electrical infrastructure and new LED lighting.

• City administrator Philip Rath will give an updated about Bridge City Sanitation since the city and trash company entered a new contract over the summer.

• Rath also is recommending the state withhold a portion of the city's road use tax funds as a reimbursement for an Iowa Department of Transportation grant from 2013. The city must reimburse $342,913 because less than 120 jobs were created by either Cargill or JBS during the timeframe of the RISE Immediate Opportunity program, which was to allow reconstruction of Iowa Avenue. The jobs eventually were created, but after the deadline. The other options for reimbursement were a lump-sum payment or installment payments.
The meetings begin at 5:30 p.m. in council chambers, and will be live-streamed on the city's YouTube channel. 

— Chad Drury can be reached at, and on Twitter @ChadDrury


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