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The former Target building in Ottumwa will have a second act soon as the VA clinic moves in. The agreement approved Tuesday by the city council calls for renovations for the 15,000 square feet used by the clinic to be complete this year.

OTTUMWA — The green light is lit for redevelopment of the former Target building in Ottumwa, and the biggest piece could be finished this year.

In November of last year the Courier broke the news that the Veterans Administration planned to move into part of the building, which had been vacant since the retailer closed its Ottumwa site in early 2016. The move includes occupation of about 15,000 square feet for the clinic itself.

Planning and Development Director Kevin Flanagan said the agreement with Highlands Development, LLC, is effectively a two-phase project in which the VA will move in first. City projections estimate incentives as most likely $2.6-$2.8 million, though the cap is $3.8 million over the next 20 years.

“Our developer is looking at this like a two-phase development, where the VA is in there, presently, ready to go. And then the second phase, the retail phase, is essentially with our rebate agreement,” Flanagan said.

The vote was quick and unanimous, though Mayor Tom Lazio asked specifically about the timeline.

“They have to complete the work by the end of this year. Is that correct? That’s a tight schedule,” he said.

“It is quite a tight schedule on the development agreement,” Flanagan agreed. “That first phase is quick. That second phase may be as well.”

Discussion on another funding item was much less simple. The city council has struggled with a request for emergency funding for Bridge View Center for several weeks. The shutdowns caused by the COVID-19 pandemic have shut down the city-owned center’s revenue.

Finance Director Kala Mulder said the $115,880.93 transfer was an internal loan, a move designed to protect the city’s general fund while still meeting the city’s obligations.

“It will not reduce the general fund balance. Essentially, we’re investing some of our own funds, for a two- or three-year … internal loan,” she said.

City Administrator Philip Rath said Bridge View Center, Inc., has pledged up to $45,000 for capital improvements and other costs. He said the loan offered the opportunity for lower interest than borrowing externally and better interest on repayment.

Rath also said the city is hoping “we have a strong recovery of the economy in hotel motel and other revenues.” Economists are not unified on what sort of recovery will take place, nor when it will happen.

Council members split 3-2 in approving the measure. Councilmen Marc Roe and Matt Dalbey voted against the transfer, while Bob Meyers, Skip Stevens and Holly Berg voted in favor.

None of the council members spoke on the issue or explained their votes.

Matt Milner can be reached at mmilner@ottumwacourier.com and followed on Twitter

@mwmilner

Matt Milner can be reached at mmilner@ottumwacourier.com and followed on Twitter

@mwmilner

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Managing Editor

Matt Milner currently serves as the Courier's Managing Editor. Milner is a trained weather spotter and is usually outside if there are storms. He joined the Courier in 2002.

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