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Old Pioneer Ford project, agreement approved

Old Pioneer Ford project, agreement approved

The plans use one existing building, the former showroom and service building, with the rest, including the Gates Hotel, demolished for new construction.

General Capital Group/


POSTED March 10, 2017 10:47 a.m.

The Platteville Common Council Feb. 28 approved with identical 5–1 votes the Specific Implementation Plan and the developer’s agreement for the $12.88 million multifamily residential and retail project at the former Pioneer Ford Sales property.

The council’s vote came despite continued efforts to preserve the Gates Hotel property, which is slated to be demolished for parking for the project.

District 4 Ald. Ken Kilian, whose motion to remove the hotel property from the project died for lack of a second, voted against the SIP and the developer’s agreement. District 3 Ald. Barb Daus was absent.

The vote came one day before the Wednesday deadline specified in the developer’s agreement. It also allows General Capital Group to apply for tax credits through the Wisconsin Housing and Economic Development Authority, with word on approval expected in April.

The city is spending about $1.162 million on the project, including its $982,426 purchase price, and it was “critical,” in the words of City Manager Karen Kurt, to secure a developer to get the $650,000 in grants used for purchasing and assessing the site, making the city’s net investment $512,426.

General Capital Group is getting the property deed for $1, and is getting a $1.3 million Tax Incremental Financing loan, in return for guaranteed tax increment payments, repaying the loan from TIF District 7, and $21,469, the property’s last annual tax bill. 

“As long as the city owns property, site is generating no tax revenue,” said Kurt, who added that the project’s guaranteed tax payments mean the project has “not a negative impact on TIF district. Basically we’re kind of acting as a pass-through entity.”

Kurt said that approving or rejecting the project “will not have any impact on the projected shortfall in the city’s general fund budget. These are two separate funds with separate budgets.” She said the project is not taking away operating funds for city operations cut in the 2017 budget, including the Senior Center and the city museums. “That message got a little mixed on the Library Block,” she added.

Kurt said an analysis from independent financial advisor Ehlers and Associates, which is now city policy for large projects, termed financial assistance “warranted,” the projects meets the “but-for test with respect to the TIF district,” and city contribution is “not unduly enriching the developer.”

Kilian objected to both the fate of the Gates Hotel and a project with financial assistance for a developer instead of assistance for home-buyers.

Kilian asked why the committee that selected General Capital Group selected a project with “60 low-income rental units and 11 market-grade rental units — what was the rationale for this project?”

Kurt said the city’s Request for Proposal got four responses, two of which were “deemed as not being suitable in terms of meeting the complete terms of the RFP.” General Capital was chosen as the “best matched content of RFP that was approved by the council,” she said.

General Capital’s Sig Strautmanis said his company had looked at Platteville previously for student housing, and was seeking Wisconsin communities with property near downtown for projects that would be “pedestrian-oriented” in “more urban infill locations.” His definition of “affordable housing developments” does not include income-based rental assistance except for such populations as disabled, elderly or veterans — what he called “middle-income in the affordability spectrum.”

Strautmanis pointed to the United Way Asset Limited Income Constrained and Employed study last year in Wisconsin that showed the state had “remarkably low income for a lot of people who are working decent jobs, trying to make ends meet, but they have limited assets, they’re income-constrained by the employment that they have, but they are employed. That is my market … working certain types of jobs in Platteville that don’t pay a lot” 

He described the project as “cool, hip, trendy housing that’s also affordable.” 

“We do not have a good market in Platteville as far as properties that single families can buy,” said Kilian. “They can’t afford them because the rental market as far as students has priced them out of the market. … We have money for this … but we don’t have a program for single families.” 

At-large Ald. Amy Seeboth-Wilson part of the city’s intent is that people can move out of rentals, allowing houses to be returned to owner-occupied — “a relatively free market model to achieve our housing goals.”

When Kilian asked how the city can help homeowners, Common Council president Eileen Nickels replied, “That problem has not been solved.”

The longest part of the meeting dealt with the fate of the Gates Hotel, which Historic Preservation Commission member Garry Prohaska said a letter from state historic officials called “historic on two levels,” based on “the status of area locally” and “the historic integrity that remains in building.” 

The commission held a hearing Monday on possibly designating the site a local historic site, which would ultimately require council approval.

Nickels said if the property received a local designation, the commission would have to approve “any changes to the building,” including demolition. 

“I do think the council should be the officials to make the ultimate decision,” she said. “It’s a building that has history that has not been designated historic. We have a letter saying potentially it could be historic.” 

Nickels said a state or national historic designation could take up to a year and a half, with no guarantee of the result, and no state or federal tax credits available if the property is not declared historic. 

Other speakers at the meeting wanted the property preserved.

Fred Domann called Platteville “sort of the center of a very historical neck of the woods,” including Galena, Dubuque, Potosi and the first state Capitol in Belmont.

“I would advise you not to do anything with Gates Hotel until HPC makes its resolution,” he said, adding that “If the old hotel is used as a residence, it’s a very convenient place” for a young family. “The sooner that building is renovated, it would generate a little revenue, and God knows Platteville could use a little revenue these days.”

Galena developer Tobin Murdock, who previously indicated interested in developing the hotel property, was at the meeting, as was architect Adam Johnson.

“We’re along in this process a pretty far ways to be discussing this, but I think when you have an historic structure likes this and you have the ability to redevelop them and rehab them, it’s an important resource your community has of bringing in additional dollars to your community,” said Johnson. “Turning these kinds of resources into parking lots is usually not a good way to take advantage of that kind of resource.”

“If we were to pull that out of the application at this time, it sounds like there’s not much time if any for the developer to go back, go to the drawing board and redo their application and update it, and we’d probably be reducing the chances for tax credits at that point, which would then change the whole project,” said Seeboth-Wilson. “If we ask the developer to pull out the Gates Hotel, it’s not as simple as it sounds. …

“The parcel was for sale for three, 3½ years before the city bought it, and then we spent a year talking to the developers. … I know that it’s frustrating, because the outcome’s not going to be perfect for everybody.” 

She said that changing the project now would risk the developer’s financing and “our access to $650,000 in grants to help with this project. … I realize private businesses can’t often take an old building and restore it very easily; it’s super-expensive, which is also why the city isn’t doing it because we don’t have a lot of money for these projects right now.”

At-large Ald. Tom Nall said the property was considered for demolition in 1987, and was not placed in a historic district after a 1995 survey.

“If it was up for demolition in 1987, and the only reason it was saved is because somebody purchased it to have it as a student rental, there was nothing in 1995 that they reported to keep it or put it on the registry,” he said. “There’s a point where we have to say a building is a building and it can only last a certain amount of time. And it’s come to that point where sometimes you can’t keep a building to stop the progress of the community.” 

“Is progress making a parking lot?” said Kilian. “Is that what we call progress?”

Nall said the Historic Preservation Commission “only came to us when it was going to be destroyed. They didn’t go to the developer while it was going to be saved as the developer wanted to save it for residential; they could have went to the developer and said we want you to save it … they didn’t do that. So to come in at the ninth hour of a 10-hour program and say we want you to save it is doing a disservice not only to the council and the developer, but it’s doing a disservice to the citizens of Platteville.” 

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