Last week, Mayur Dankhara, COO, of The Green Mission Inc., LEED AP, ISA AM and I enjoyed the privilege of traveling to Dubuque, Iowa, to tour the city and observe the actions taken by several local organizations for the environmental and economic improvement of their community. Our tour-guide was our Green Mission Inc. Associate John Wegmann, CPA a Wharton graduate with 30+ years of experience and currently an Opportunity ZoneFund tax and investment advisor. John and I plan to work closely on future deconstruction and waste diversion projects in the Dubuque area. We were also accompanied by Hillary Dalton, a brilliant Dubuque resident of philanthropic pursuits with an MFA and 30 years of focused community involvement in the Midwest.
Located on the Mississippi River, Dubuque is Iowa’s first and oldest city. With approximately 58,000 inhabitants, it is the 11th largest city in Iowa. The city’s leaders, quite progressive and keenly aware of the significant efforts and initiatives needed for Dubuque to remain relevant, have been completing several major projects to combat environmental stressors and to reverse the malaise of ubiquitous blight common among midwestern cities and towns.
Dubuque’s revitalization efforts embrace four key areas: Addressing Climate Change, Historical Preservation, Solid Waste Diversion, and Federal Opportunity Zone Designation.
Addressing Climate Change
Climate change is impacting cities around the country and the world and Dubuque, is no exception. In this regard, Dubuque happens to be a leading city taking meaningful action to increase its resilience to such effects. We learned of one project, the $232 million Bee Branch Watershed Flood Mitigation Project (“BBWFMP”), designed to protect he city’s residents and businesses from flash flooding caused by heavy rainfall.
Once complete, the BBWFMP will increase the flood mitigation system’s capacity to protect the area from a 75-year event to a 500-year rain event.
large-scale infrastructure improvements designed to combat the devastation caused by periodic-flooding by the Mississippi River. The first phase of the project, called the Bee Branch Creek Restoration was completed in 2017 and involved converting a culvert into an open creek to allow water to flow away quicker in greater volume. Despite record rainfall in 2019, very few properties have experienced flood damage in the past couple of years. In previous years, residents in the watershed routinely experienced property damage from devastating flashfloods. With record-setting precipitation, 2019 would have been a major disaster had the creek not been restored. The next critical phase of the BBWFMP – the Bee Branch Creek Railroad Culverts Project -- is currently underway. It involves using micro-tunneling methods to install six, 8-foot diameter culverts under the Canadian-Pacific Railway Tracks to promote further drainage.
In 2017, in an effort to increase biodiversity within the Bee Branch Creek, another exciting project revolved around the creation of 14 manmade floating islands fashioned out of recycled plastic bottles used to create a “floating ecosystem.” 1 This green infrastructure tool improves water quality, provides habitat and wetland restoration, and reduces nitrogen and total phosphorus outputs. Over 67,000 recycled plastic bottles were used to achieve this plan to restore some balance to the water’s ecosystem.
Additionally, the city’s Washington Neighborhood and Millwork District have benefitted from impervious surface reduction, thanks to the construction of Green Alleys.
These projects have all been made possible by the responsiveness of city government to the needs of residents and their willingness to make investments whose benefits will be felt for hundreds of years.
Historical Preservation
The highlight of our visit was learning about the various programs implemented to provide restoration efforts to the city dwellings and empty factories from the days Dubuque’s Millwork District was a thriving center for the manufacturing of wood doors, window, and trim. These projects focus on renovating abandoned, empty, or decaying properties and transforming them into sustainable and socially meaningful businesses and living spaces.
Within the five historical districts within the city limits, over 1,300 properties are listed on the National Register of Historic Places. In 1977, the city adopted a Historic Preservation Ordinance, and in 1979 a Historic Preservation Committee was formed in part to seek out funding and connect developers and related businesses to the advantages of local preservation projects.
Heritage Works Inc., a local preservation 501c (3) non-profit in Dubuque has taken on the challenge to preserve the historic buildings to restore the city’s charm and attract over 1,500,000 tourists annually. Speaking with Heritage Works CEO Duane Hagerty, the environmentally conscious non-profit focuses on three critical areas of rehabilitation services: historic properties and redevelopment; education and training; and outreach and promotion. Their mission is “Leveraging architectural heritage to drive community revitalization and economic development.” 2 By doing the work needed to obtain grants such as the Historical Resource Development Program (HRDP), Heritage Works believes that preservation instead of demolition helps Dubuque retain its sense of history within the community while spurring economic growth at the same time.
Though our time in Dubuque was brief, we were blown away by the dedication of community leaders to raise awareness of the need to preserve as much of the history of the buildings as possible. Through the use of historic tax credits, grants, and private funding, the renovation and restoration of the city is flourishing. Local developer John Gronen has been instrumental in obtaining the funding and completing the restoration of a large number of projects, in addition to sourcing tenants and ongoing management of these properties. Notable examples of successful preservation projects include the Town Clock, Caradco Lofts, Dupaco Voices Building, Novelty Iron Works, Building, Steeple Square, the Securitiy Building.and the old Roshek Department Store.
Solid Waste Diversion
Local entrepreneurs have responded well to the community’s economic efforts to revitalize the downtown area in environmentally responsible ways. We stopped to visit Upcycle Dubuque, a beautiful shop owned by Kristina Wilcox-Beytien. In 2018, she and her husband fell in love with the building located at 1838 Central Avenue, purchased it, and transformed the ground floor spaces into an artisan retreat featuring a retail shop, an art gallery, and a creative reuse center all with a green mission in mind.
Beytien’s motivation for opening Upcycle Dubuque was to educate and engage the community in new ways of thinking about repurposing and recycling materials to better serve the environment. “Upcycle Dubuque is what is known as a creative reuse center. A movement that was started some 30 years ago in Australia. The items that come in our store are donated by the surrounding community and then priced at half the retail price. These items were destined for the landfill because there is nowhere in Dubuque to take creative supplies that can have another life. We promote creative reuse, art, upcycling, and environmental concerns.”
Also located within Upcycle Dubuque is Gallery A, owned by local artist Allison Poster, where artists can come to work, explore the art, and educate the community about the use of recaptured materials. Beytien explained, “Allison uses a great deal of recaptured materials in her creations. She has worked to gather other artists that use recaptured materials in their work as well. We decided to help Allison open the gallery inside Upcycle Dubuque because of her passion and dedication to art and creative reuse. You can’t address creative reuse, environmental issues AND redevelopment of a forgotten part of the city without taking artists with you. The gallery is a critical component in what we are working to achieve.”
Kristina and her husband, Craig, also have been busy transforming the upper portion of the building into affordable living spaces. The three renovated apartments are slated to be rented by February 2020. And the city is giving back to the Beytien’s in kind: they recently learned that they will be receiving this year’s Historic Preservation Award from the Dubuque County Historical Society at the Dubuque Main Street’s annual Architectural Days celebration in April 2020 for their hard work and dedication to the revitalization of their community.
Federal Designation as a Qualified Opportunity Zone
The Tax Cut and Jobs Act (TCJA) introduced Subchapter K of the Internal Revenue Code to encourage new investment in certain designated economically lagging census tracts across the US. These areas are known as Opportunity Zones. Forbes magazine has called Opportunity Zones, “The Most Unbelievable Tax Break Ever,” and most tax experts agree with this statement. This program is intended to encourage investors to take up to $6.5 trillion in stock and real estate gains by providing a tax deferred and tax reduction to the extent they reinvest the gains in Opportunity Zones. In addition, Qualified Opportunity Zone properties and businesses can be sold of free of depreciation recapture and capital gains tax if held for at least ten years. In addition, Iowa is one of the states whose tax code mirrors federal when it comes to Opportunity Zones.
Dubuque is fortunate to have two Opportunity Zones – encompassing key areas such as the Central Business District, the Port of Dubuque, and historical neighborhoods that are already thriving and primed to grow more. There are no other opportunity zones for many miles in every direction, which should prompt business startups to strongly consider location or relocation withing these Opportunity Zones.
Given that the TCJA has watered down the benefit of the Historical Tax Credit, the city’s Opportunity Zonesshould provide even greater incentive for real estate development and redevelopment as well as business investment in Dubuque.
Conclusion
Dubuque, Iowa, on the Mississippi River is the state’s oldest city and an architectural gem. The city’s government and residents have been on the forefront of responsiveness to climate change, historical preservation, and solid waste diversion. These factors, combined with the designation of two census tracts as Opportunity Zones, make off-the-radar Dubuque one of the most attractive spots in the nation for real estate development and redevelopment as well as business location.
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For more information about this project, visit https://apnews.com/1e847db590904fc78b9c177e736e227d
