Up to $6 million in city tax increment finance assistance was approved for the DMACC Maytag Campus on Monday. City council gave the go ahead to help DMACC make capital investments and renovations that enhance the long-term viability and economic relevance of the campus.
“DMACC has been aggressively looking at how to fill that campus with a variety of uses, both educational and business and the connection between those two,” city director of finance and development Bryan Friedman said. “I think the investment the city would be committing would greatly facilitate their ability to keep that campus a vibrant marketable place.”
DMACC has taken responsibility for the ownership costs of maintaining and operating the campus. The funds from the city would go toward the campus project but specifically not the operational costs.
The assistance takes the form of tax rebates and reimbursement for capital investments. In January, council amended the Urban Renewal Plan for the North Central Urban Renewal Area to accommodate the potential large projects DMACC could bring to the campus. It provided the city with authority, with council approval, to spend up to $6 million of TIF revenue towards “DMACC Campus improvement assistance in conjunction with growth in educational and employment opportunities.”
Since DMACC is tax exempt, the tax abatement program would only be used for the commercial tenants on the property. The program would last five years and will benefit the area because the North Central Urban Renewal Area is excluded from the tax abatement program that is available in all other areas of Newton.
Up to $1.5 million of assistance would be used to fund the costs of capital improvements, repairs, remodeling and infrastructure. Those funds would come from the North Central TIF District and utilizes the gains in valuation from past projects in the area.
Prior to DMACC being gifted the campus in October, the city had a redevelopment agreement with Newton Enterprises, the campus’s previous owner. The agreement called for a series of partial property tax rebates if certain development performance standards were met.
Following the change in ownership, the redevelopment agreement did not transfer and was formally canceled in November. In turn, there was more than $1.5 million in potential property tax rebates for future years that were foregone.
“The $1.5 million is consistent with the amount that was remaining in the previous funding commitment to Newton Enterprises and would facilitate DMACC making further investments into the campus,” interim city administrator Jarrod Wellik said.
A 28E agreement between the city and DMACC has been developed to formalize the assistance. The 28E does not commit any of the funds and specifies that it would be for new, job-creating projects that would require additional action by the city council on a case-by-case basis in the future.
“We do appreciate the partnership the city has entered into with DMACC. There has been a long standing partnership since the first building was put up,” said Kim Didier, executive director of DMACC Business Resources and project manager of the Maytag Campus. “We are delighted to be a partner to help revitalize the space. There are great opportunities that we continue to pursue and we do hope that some of the synergy between some of the programs that we already have on the Newton campus would allow for not typical classroom experience, but on the job kinds of experience with our students.”
The DMACC Board of Directors will consider the proposed 28E agreement at its Monday meeting in Newton.
Contact Jamee A. Pierson at 641-792-3121 ext. 6534 or firstname.lastname@example.org