FORT MADISON - A move to shore up the west side of the crumbling Block building in downtown Fort Madison may cost the city close to a quarter million dollars.
At Tuesday's regular City Council meeting, Mayor Matt Mohrfeld said the city could be looking at $240,000 to repair the building according to estimates and contingencies the city has received recently.
The building is currently in state of deterioration and the city would like to get the building transferred to a developer, but the building needs to be shored up.
The city has brought in a contractor and engineers to look at the structure and has a mitigation and stabilization plan that would involved deconstruction of the stressed areas of the building, sealing it off with some light roof repair with an intention to rebuild it going forward.
"This is also going to be coupled with a discussion we've had with the department of economic development about the emergency catalyst grant," Mohrfeld said.
"If we were awarded that designation that would help offset up to $100,000 of the project."
He said it also plays into plans to meet with a developer in two weeks to enter into a contingent transfer of ownership for the purpose of redevelopment of the property.
"It's going to depend on some costs and some tax credit funding and whatever's brought to the table in those contingencies."
Fire Chief Joey Herren said this would be the best financially for the city. He said the cost to the city is going be closer to the $500,000 to $800,000 if the city has to tear it down.
"This is our best bet to take care of it."
He said plans are to take down the outside layer of bricks and save those, stabilize the building and put the bricks back up to hold onto the historical value, and then open the street back up.
Herren said plans are in place so contractors can get to work on the project right away.
Mohrfeld said nothing will happen until the city knows if they are invited to apply for the emergency catalyst grant.
Councilman Rebecca Bowker asked if the city could do the work without applying for the grant, because other property owners in the city are looking to use the emergency catalyst grant and the city can only apply for one project per grant cycle.
City Manager David Varley said there are some funds in accounts that could be used to fund the repair work out of the building funds.
"So we wouldn't have to use the emergency catalyst grant if we didn't need to?" Bowker said. "I know other developers are applying for that emergency catalyst money and, if the city applies for it, we knock them out of the running for it."
She said the city should be transparent as they move forward and not renege on commitments to other projects.
Jenny Divine, who's been working to develop the space at 833 Avenue G, told the council she too was hoping to apply for the emergency catalyst money for her project.
Councilman Tom Schulz asked Bowker what other emergencies the city is dealing with.
Morhfeld said the city is looking at roughly $240,000 for stabilization and mitigation of the property. He said the state grant could trigger up to $100,000 to go to the work.
Bowker said originally that figure was $70,000 and then $165,000 and now it's $240,000. Mohrfeld said estimates were $165,000 to stabilize and mitigate the crumbling panel, some additional light roofing, and a 15% contingency funds, all numbers fed to him from engineers.
Bowker asked why the city couldn't turn around and then sell the building for at least the cost of the repairs to the city.
"It's 16-20 apartments. I'm just saying that something with the potential of that many apartments that could qualify for Community Development Block Grants for upper story development, that all the other apartments downtown qualified for, how can we not ask for a reasonable amount of money for that building?" Bowker asked.
Mohrfeld said the city had no chance of getting money initially out of the building.
"We don't have a snowball's chance in hell of getting a buck out of that building. That thing is an historic, beautiful building downtown - with a negative value of about $800,000 right now," he said.
"A developer has to make money to come in and do it. No doubt about it. I've walked through that building several times and looked at pro formas and the discussion was that we were going to try and recapture some of this cost on the tail end of the job," Mohrfeld said.
Bowker asked what the city promised the developer on the cost of the building. Mohrfeld said there was no promise on the cost of the building.
"If it had value, it probably would have been liquidated before now," he said.
The city took ownership of the property in April after several court proceedings in North Lee County Court.
The council voted 7-0 to approve a resolution authorizing an emergency abatement on the property which allows the city to move forward with other options under the emergency abatement language.
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