Government shutdown halts Iowa Wholesale project

The progress on the Iowa Wholesale building may seem to look non-existent, but Housing and Community Development Director Michelle Spohnheimer said the project is still a go.

“With the government shutdown that happened earlier this month it did have a large impact on our programs, one of which is this project,” Spohnheimer said.

The Housing and Community Development staff is waiting for approval from the federal Housing and Urban Development staff in Washington D.C., she said.

“One of the funding sources into that project we got what is a Hope 6 Main Street grant for $1 million,” Spohnheimer said. “Before we can spend down most of that money they have to approve pieces of the plan what they call a pre-development proposal so we are waiting on that approval.”

Spohnheimer said they have been waiting for about nine months for the approval.

“There was always like one more thing that they needed, pieces of information or a question,” Spohnheimer said. “So we thought we were going to have it about two months ago. It kind of kept getting delayed. When the shutdown occurred in October then we really weren’t going to get anything and now they are recovering from the shutdown.”

Spohnheimer said there is a possibility this project will go to a third party contractor.

“HUD staff have enough to do that the powers above them have said you have to hire a contractor to continue review,” Spohnheimer said. “From the correspondence we got from our rep, he is trying to get it off of his desk for us and to avoid going to that third route but at this point we don’t have a guarantee on that.”

Spohnheimer said if it does go to another contractor to complete the review it may take additional time.

“Things are still moving,” Spohnheimer said.

Once the approval does go through, the next step is waiting on a pre-developmental plan which is part of the environmental review.

“We have to have their approval before we spend the rest of the money and that money is supposed to be spent on the acquisition of the property,” Spohnheimer said. “The developer is buying the property, but we were using grant funds as part of that project to do that so they can’t really start on construction or other things until the property is transferred.”

Spohnheimer said she remains optimistic.

“We’re hopeful things will resume and we’ll see some activity,” Spohnheimer said. “I’m keeping constant contact with developers and everyone is eager to see that project moving.”