Last summer Governor Branstad signed legislation into law creating the Nuisance/Abandoned Property Remediation Fund, which is managed through the Iowa Economic Development Authority (IEDA). This fund allocates $6 million in the form of low interest, short-term loans available to municipalities of any size across the state. One third of these monies have been specifically set aside for cities of less than 10,000 population until September 1, 2016. Costs incurred in the preparation of an application are not eligible to be reimbursed with program funds.
Loan applications for this new state-funded program are currently being accepted and can be submitted through iowagrants.gov. Applications will be accepted continuously until funds are exhausted. There is no set minimum or maximum request amount.
Funds can be utilized for the remediation and rehabilitation or demolition and clearance of commercial, residential, industrial, or institutional structures. A redevelopment plan speaking to all structures to benefit from program funds must be included within the application. Projects undertaken with loan funds must be completed within the term of the associated loan.
All buildings addressed through the program must be documented as representing a public nuisance through abandonment, neglect, chronic code violations, or structural deterioration/dilapidation to the point of constituting a hazard to public health, safety and welfare. Communities may use the loan funds only for costs directly related to the project as proposed within the application. IEDA may require documentation or other information documenting the actual costs incurred for a project.
Loan terms are set at 12, 24 and 36 months. The corresponding interest rates are 1%, 2% and 3%. Cities with populations of 2,000 or less can request a loan at a 0% rate. Communities may make loan payments to IEDA on a quarterly, semi-annual or annual basis. The possibility of “balloon note” payments may also be considered by IEDA.
IEDA staff will review applications under a competitive criteria review system. Review criteria include:
- Financial need of the community
- Extent of blight in the community
- Condition of housing stock in the community
- Administrative and operational capacity
- Percentage of low to moderate income residents in the community
Each of the five review criteria has maximum of 20 points; the maximum score for an application is 100 points. Applications must achieve a score of at least 50 points to be considered for funding. The IEDA Director will make the final funding decision on each application. Final funding decisions will be based on application scores and the amount of funding available.
For further information concerning this program, please contact IEDA project Manager Ed Basch at 515.725.3012 or via email at Ed.Basch@iowa.gov.
Ed Basch, Project Manager Iowa Economic Development Authority