The Oskaloosa City Council on Monday approved a new tax-increment financing policy, authorized a slate of TIF reimbursements for fiscal 2027 and directed staff to accept a promissory-note structure that is recourse during construction and nonrecourse after substantial completion for the Jefferson School Lofts senior-housing project.

The TIF policy — presented by Suzanne Gerlach of PFM Financial Advisors — establishes three program tiers (commercial, market-rate residential and an LMI/blight remediation track) and includes an Excel-based “rebate calculator” to help staff and council evaluate future requests. Gerlach said the tool makes it easier to compare the city’s projected net present value for different rebate terms and to verify whether an incentive meets the policy’s goals. “It gives you the tool… so you can put in real cash flow,” Gerlach said.

City staff also brought forward a resolution listing TIF reimbursement requests tied to past development agreements. Staff explained the attachments and deadlines for filing to the county auditor; council approved the reimbursements by roll call with one abstention recorded.

The council then turned to the Jefferson School Lofts, a $12.7 million senior-housing redevelopment that the city previously supported with a $250,000 loan from the Oskaloosa Housing Trust Fund. Developer representative John Cronin told the council that investor requirements tied to low-income housing tax-credit syndication make some nonrecourse language necessary to generate “partnership minimum gain” under the Internal Revenue Code. “We went into this project and sought the low-income housing tax credits… the price of that syndication went down,” Cronin said, describing the financing gap and the investors’ contractual constraints.

City staff presented three options. The council voted to authorize option 3: allow the promissory note to be recourse during construction and rehabilitation, and convert to nonrecourse after substantial completion and stabilization. Developer counsel Jake, who participated by phone, explained the IRS mechanics that link nonrecourse debt to the investor allocation of tax credits.

The meeting also included a funding resolution and conditional-assignment agreement related to the Oskaloosa Early Childhood Education and Recreation Center with the Mahaska County YMCA, which council members approved after staff noted prior closed-session reviews and attorney involvement. Separately, council approved pay application No. 4 from Carl A. Nelson Company for $973,576.98 for natatorium work; SVPA architects had reviewed and signed the request.

What’s next: staff will follow through on the loan-document direction to negotiate language consistent with option 3 and continue to use the PFM tool to vet future TIF requests.

Ending: The council approved the policy and the listed reimbursements, passed the YMCA and pay-application actions, and instructed staff to proceed under the loan-direction it adopted for Jefferson School Lofts.