A new restaurant and future development projects in the Island City are spurring the City of Sabula to create a plan city leaders hope will help the community to thrive.

Sabula is developing an urban renewal plan that could assist the city, businesses, and possible developers with current and future economic development.

The Sabula City Council and the Jackson County Economic Alliance have been working more than two years to create a plan to help the city develop economically, draw new business and industry to town, revitalize the downtown, and generate incentive dollars to assist those efforts.

David Heiar, JCEA senior adviser, explained the plan to representatives of the Easton Valley Community School District and Jackson County Board of Supervisors during a consultation meeting last week. Iowa Code requires that all involved taxing bodies be informed of the urban renewal plan because their property tax revenues may be affected if the plan is put in place.

A couple of investment opportunities prompted Sabula to advance the urban renewal plan, Heiar said.

First, Patricia and Jesse Lawson own property in the south port area of Sabula, including in the Island City Harbor marina. They are considering demolishing a dilapidated building and constructing a new restaurant event center, making dock improvements, and setting up a canoe/kayak/boat rental operation there.

The owners anticipate spending about $500,000 to bring the project to life. However, the Lawsons’ project is contingent upon receiving a state emergency catalyst grant award, for which an application has been submitted, Heiar said. The emergency catalyst grant would help pay for removal of the dilapidated building, he said.

Sabula’s urban renewal plan would include this project among the other goals the city has, according to Nic Hockenberry, JCEA executive director.

Additional project funding could come from Sabula’s tax-increment financing district, which does not exist now but would if the city adopts the urban renewal plan.

Plans that qualify for tax-increment financing (TIF) dollars must be included in Sabula’s urban renewal plan, which can be amended as new projects arise, Heiar explained. If such plans are not included, the city cannot act on them, he added.

How urban renewal

plans work

Urban renewal areas, commonly referred to as TIF districts, were developed as a fiscal tool to give cities money to find funding for development projects, according to Phuong Nguyen-Hoang, associate professor of the University of Iowa School of Urban and Regional Planning and Public Policy Center.

Towns must first establish TIF districts based on slum, blighted, or economic development areas. Once established, the assessed value of taxable property within the designated area becomes the base value.

The entire city of Sabula would be included in the urban renewal plan. However, only the South Port area and the downtown would become designated taxing districts, Heiar explained.

If assessed property values within the taxing districts increase, the difference (increment) between the base and the increase is diverted for projects or activities within the urban renewal area, Nguyen-Hoang explained.

Because Sabula’s taxing districts would be new, Heiar said he could not adequately estimate how much money the taxing district would generate.

TIF money can be used for anything from street repairs to design plans to promoting economic development, provided those activities are within the urban renewal district.

Cities that pay for qualifying TIF projects from their general fund can request reimbursement.

To be reimbursed, the city must certify its debt. When the city spends money on a qualifying project or activity, it incurs a debt and is entitled to reimbursement, according to Nguyen-Hoang. The city then submits those qualifying expenses to the county auditor for certification.

After the debt is certified, the county assessor pays back the city with funds raised from the TIF.

Sabula’s urban renewal plan also would establish a Downtown Revitalization Incentive Program, mirrored after those in Bellevue, Maquoketa and Preston. The program would provide grants and loans to local business owners situated in the Sabula downtown area with: façade improvement projects, building or land acquisition costs, capital improvement projects, job creation or training, accessibility improvements, utility upgrades, site development and other projects approved by the city.

The goal, the plan states, is to eliminate deterioration of buildings and to restore and preserve eligible properties, which would then attract customers and additional investors to the downtown.

The urban renewal area also seeks to promote new residential development.

The public can ask questions and share opinions about the proposed urban renewal plan during a public hearing at 6:30 p.m. Feb. 23 at Sabula City Hall.

The Sabula City Council may decide whether to adopt the urban renewal plan that night.