Dubuque council approves downtown rehab grant, incentives for Schmidt Island hotel and several public contracts

The Dubuque City Council on March 3 approved a package of development agreements and public-contract awards, including a downtown façade and office rehabilitation project and tax-increment incentives tied to a new boutique hotel on Chaplain Schmidt Island.

Economic-development director Jill Connors told the council FEH Realty, a subsidiary of FEH Associates, plans a $2,500,000 rehabilitation of 902 Main Street to create larger office space and to repair structural and roof issues. Under the approved development agreement FEH must maintain 11 full-time-equivalent positions and create at least 10 additional FTEs by Oct. 1, 2028; the company will receive up to 10 years of tax-increment financing rebates estimated not to exceed $115,000, and the city will consider a downtown rehabilitation grant of up to $35,000 pending design approval. Connors recommended approval and the council adopted the resolution 7-0 (motion by Sprank, second by Wethal).

Why it matters: The agreement is intended to restore a highly visible downtown building and retain and grow local office employment in central Dubuque.

Schmidt Island hotel, lease amendment and related incentives

The council also approved a development agreement with the Dubuque Racing Association (DRA) for the construction of the Key Hotel, a seven‑story, 90‑room Tapestry Collection by Hilton property on Chaplain Schmidt Island, with construction described as already underway and substantial completion targeted for Sept. 30, 2026. City staff described the hotel as part of a multi‑year improvement program at the island and said the project represents about $49,000,000 in private investment. The DRA’s financing includes a $4,000,000 loan from Dubuque Initiatives earmarked for rooftop amenities, and the city will provide 10 years of tax‑increment financing rebates to support the project. The council approved the development agreement 7-0 (motion by Resnick, second by Jones).

Immediately after the development-agreement vote the council approved a second amendment to the lease between the city and the DRA covering Lot 1 on Chaplain Schmidt Island (the parcel containing the casino and hotels). The amendment adjusts requirements for the debt-payment reserve fund, provides a mechanism for refinancing the Hilton Garden Inn if the reserve dips below agreed levels, and allows allocation of certain lease payments to an endowment fund to retire a loan for the Veterans Memorial. City staff said the amendment takes the new hotel agreement and rebate timeline into account; the amendment passed 7-0 (motion by Roussell, second by Sprank).

Other public projects and contract awards

- The council approved construction plans and an estimated cost of $319,880 for the Bunker Hill Foundation Repair Project, to address water infiltration and related structural work at the clubhouse; Parks and Recreation Director Marie Ware told the council the work includes basement repairs and temporary changes to building access during construction. The resolution passed 7-0 (motion by Farber, second by Wethal).

- The ImOn Ice Arena dehumidification system upgrade public-improvement contract was awarded to EZ Sheet Metal for $308,950, after sealed bids were opened; city staff recommended awarding to the low bidder and the council approved the award 7-0 (motion by Jones, second by Sprank).

- The Southgate Drive sanitary-sewer improvement contract was awarded to Chick Fry Excavating for $196,666.80 (amount read into the record as approximately $196,666.80 and described as 1.58% above the engineer’s estimate); the council adopted the award 7-0 (motion by Wethal, second by Jones).

Appointments, hearings and other business

The council moved several appointments to local boards and commissions: Rachel Boakey to the Catfish Creek Watershed Management Authority (term to 07/16/2028); Alan Schumacher, Sarah Tandy and Colleen Myers to the Civic Center Advisory Commission (terms noted in the record); and Chad Widoff and Adam Schwendinger to Historic Preservation Commission terms (including an interim vacancy fill). Each appointment vote passed by recorded roll call, 7-0.

The council also set public hearings for a proposed development agreement with Groening Development Inc. (hearing set for March 17, 2025) and initiated the public-bidding process and set April 7, 2025 hearings for the Hebe Street Reconstruction Project (construction bidding and special assessments). Those motions passed 7-0.

Votes at a glance

- Resolution approving development agreement with FEH Realty / FEH Associates for 902 Main Street rehabilitation: Passed 7-0 (motion by Sprank; second by Wethal). Key terms: ~$2,500,000 capital investment; maintain 11 FTEs; create ≥10 FTEs by 10/01/2028; TIF rebate not to exceed $115,000; downtown grant up to $35,000.

- Resolution approving development agreement with Dubuque Racing Association for Key Hotel on Chaplain Schmidt Island: Passed 7-0 (motion by Resnick; second by Jones). Key terms: ~ $49,000,000 investment; 90 rooms; 10‑year TIF rebates; construction substantially complete by 09/30/2026 per staff.

- Resolution approving second amendment to the Dubuque Racing Association lease (Lot 1, Chaplain Schmidt Island): Passed 7-0 (motion by Roussell; second by Sprank). Key elements: debt-payment reserve adjustments; refinancing mechanism for Hilton Garden Inn; allocation to endowment fund to retire Veterans Memorial loan (fiscal years 2024–2028 or until paid).

- Bunker Hill Foundation Repair Project (construction plans and estimated cost $319,880): Passed 7-0 (motion by Farber; second by Wethal).

- Award contract for ImOn Ice Arena dehumidification system upgrade to EZ Sheet Metal, $308,950: Passed 7-0 (motion by Jones; second by Sprank).

- Award contract for Southgate Drive sanitary sewer improvements to Chick Fry Excavating, $196,666.80 (approx.): Passed 7-0 (motion by Wethal; second by Jones).

- Appointments to boards and commissions (multiple): Each passed by recorded roll call, 7-0.

Context and next steps

Staff said the Schmidt Island investments are part of multi‑year public and private improvements that include amphitheater, connectivity work and previously completed Veterans Memorial and arena projects. Several council members noted a number of them serve on the DRA board and had abstained from earlier DRA action when it was before that board; the council’s votes at this meeting were recorded as unanimous 7-0. Several items approved at the meeting require subsequent administrative steps (e.g., plan amendments to the greater downtown urban renewal district and the scheduled public hearings for Groening Development and Hebe Street reconstruction). The meeting adjourned into closed session on pending litigation and real‑estate matters after the actions above.