Iowa City Offers Funds for Developers Interested in Replacing Flood-Damaged Rental Properties

Media Release

The City of Iowa City is accepting applications for the construction of multi-family housing units that will help replace rental units lost in the 2008 floods. The Multi-Family (Rental) Unit Production Program is funded by the Supplemental Disaster Recovery Community Development Block Grant (CDBG) program, which is administered by the Iowa Economic Development Authority. The City will accept applications from developers and determine which proposals to submit to IEDA, which will then decide in early March which projects to fund.

Developers may apply for up to $3,000,000 in CDBG funds for new construction of multi-family rental projects, or for "adaptive re-use" projects that convert non-residential structures or buildings into residential use. The deadline to apply is Thursday, January 17, at 5 p.m.

For projects with 12 or more units, CDBG funds will be awarded as a 10-year forgivable loan that will be forgiven in full at the end of the 10-year compliance period. For projects with less than 12 units, assistance will be in the form of a five-year forgivable loan.

At least 51% of the newly constructed rental units must be occupied by individuals or households whose incomes are at or below 80% of the area median income limits. Fair market rents must be charged: $670 per month for a one-bedroom, $853 for a two-bedroom, and $1,257 for a three-bedroom apartment. Mixed use development projects that combine a commercial venture with residential housing will be allowed, but only the residential portion of those projects will be funded.

For more information or to learn how to apply, contact David Purdy, Community Development Planner, at 319.356.5489 or e-mail david-purdy@iowa-city.org.