Waukee denied $20 million for Kettlestone district

Waukee has to re-evaluate what it will do with part of its major Kettlestone development after a state board denied the city's request for funding.

"We're disappointed because we have a pretty strong project … but, we'll move on to what our next steps will be," City Administrator Tim Moerman said.

The Iowa Economic Development Authority has winnowed down eight applications that sought about $188.8 million to only five. Approved applications include ones from Grinnell, Coralville, Mason City, Sioux City and Davenport.

The cities are seeking funding under the state's Reinvestment District program, which is in its second round. If a district is approved, cities can take future tax money generated in those zones to finance new projects, such as hotels and event arenas.

Waukee sought $20 million for a 25-acre district north of Interstate 80 and west of Grand Prairie Parkway surrounding a pond. It was the only city in the Des Moines metro that applied this year.

Initial plans included a proposed 10,000-person amphitheater and a 175-room hotel and convention center with 12,000-square-feet of event space, among other components.

"Our intention is still to have a significant public space north of the pond ... and we don't know what that is all going to look like now once we heard this news about the amphitheater," Moerman said.

The city's proposed district is a part of the larger Kettlestone project, a 1,500-acre mixed-use development the city is pursuing. Moerman said the board's decision does not derail Waukee's other Kettlestone plans.

In addition to Waukee, Marion and Cedar Falls also did not exceed a necessary score threshold and will not be considered this year.

The board has not guaranteed funding to the five cities that are moving ahead. It will hear presentations from each on May 21.

Combined, the five cities are looking for more than $65.5 million in funding, but the state can only hand out about $41.5 million. How the board will make up that difference has not been determined.

The board could decide to give funding to all five, but at lower amounts than requested. Or, the board could decide to fund only some of the requests.

Here's are summaries of the five proposed projects that can move ahead:

Coralville: 7,000-seat multiuse arena and concert venue, athletic training center, Drury Hotel and space for two museums. Requesting $12 million with a total project cost of $185.3 million.

Davenport: a 160,000-square-foot sports tournament center; two hotels with 240 rooms; a FlowRider surfing machine; and more than 113,000 square feet of retail and restaurant space. Requesting about $21.8 million with a total cost of $73.8 million.

Grinnell: a boutique hotel and event center; a new performance stage and pavilion in the city's Central Park; $100 million in improvements for Grinnell College; and other downtown improvements. Requesting $8 million with a total cost of $127 million.

Mason City: a 96-room Marriott Courtyard hotel with a conference center; an indoor/outdoor performing arts pavilion; a 2,400-seat multipurpose arena; a 200- to 250-vehicle parking ramp; and a new mixed-use retail building. Requesting $9.8 million with a total cost of about $36.2 million.

Sioux City: a new 150-room hotel; a new Ag Expo and Learning Center in the city's stockyards; and the redevelopment of three historic buildings into restaurants, commercial or office space and apartments. Requesting about $14 million with a total cost of $73.8 million.

Iowa's Reinvestment District program started with $100 million last year. The authority board has already awarded $12 million to Waterloo and $10 million to Muscatine.

"Our hope is that the legislature finds a lot of value in this program and expands it another year at another funding amount," Moerman said.

The board is expected to consider a request from Des Moines for about $36 million at a May 22 meeting. Des Moines is asking for the funding to help finance the construction of a convention hotel that would connect to the Iowa Events Center.