Two businesses will receive forgivable loans to offset improvement costs as the city council approved TIF (Tax Increment Financing) dollars for The Eat Shop (120 W. Main St.) and RJ’Z Express (110 Market St.) during their regular meeting Wednesday, Nov. 19.
Cheryl Maloney, owner of The Eat Shop, requested $54,827.35 for reimbursement of a 2023 expansion and to offset future property taxes over the next three years. The City’s Finance Committee – councilmen John Farlinger (in place of Steve Duncan) and Cole Gabriel, recommended $25,000.
“They’ve been a great downtown business,” said Gabriel. “What we’re looking to do is to help them get over the hump since that half of Main Street has had some struggles as of late.”
The council approved the application on a unanimous vote. With the approval, City Administrator Cami Rasmussen said she would engage with the City’s Bonding Council to begin an approximately two-month process leading to a formal agreement between The Eat Shop and the City, which the Council will consider for approval at a later date.
A need to replace underground tanks, piping, and fuel pumps in order to meet a January 1, 2026 mandate for E-15 ethanol blended gasoline prompted RJ’Z Express to request TIF funds to offset the $259,000 initial bid for the project and three weeks of downtime resulting in a “significant loss in sales and profits.” During the construction RJ’Z Express will remain open but will not be able to sell gasoline. The work is expected to begin in early December to meet the Jan. 1 deadline.
Farlinger and Gabriel recommended $30,000.
“It’s another business in town that’s had to endure some hardship based on regulations that they couldn’t avoid and we thought this was a good use of the TIF funds to help them,” said Farlinger.
The council approved the application on a unanimous vote.
Under Iowa law cities are able to establish urban renewal areas to finance public improvements including streets, sewers, sidewalks, or other infrastructure for commercial, industrial, or residential development; and to fund private economic development. Funding for these projects is mostly through TIF, which takes a portion of property tax revenue and reallocates it for qualifying uses.
Street finance report
Rasmussen gave the annual street finance report, which has to be filed with the state by Dec. 1 and is an accounting for the Iowa Department of Transportation (IDOT) of all street-related expenditures. She explained the reports are used by the state to secure federal funding.
“They specifically want to know we spent our street dollars in both general fund and the road use fund,” Rasmussen said. “Most communities cannot fund their entire street department with just the road use dollars that come in.”
The City of Solon received $428,000 in road use tax funds in Fiscal Year 2025, which ended June 30, Rasmussen reported. Combined with general fund dollars, the City spent over $1 million to fund the street department with $650,000 in the general fund and $309,000 from road use funds. The City also has to report any outstanding bonds, and Rasmussen noted there is one for the East 5th Street reconstruction project with a $278,000 payment from local option sales tax revenue.
The council approved the report, by resolution, unanimously.
Annual finance report
The Annual Finance Report (AFR) is also required to be filed with the state by Dec. 1 and is a full accounting of the city’s financial expenditures and revenues for the Fiscal Year, which ended June 30. Rasmussen said the City received $9.7 million in revenue and spent $9.5 million with a reserve of $9.8 million.
“We are trying to build capital and reserves toward the wastewater treatment plant project so a lot of money is sitting in CD’s (Certificate of Deposit) (a savings account paying a fixed interest rate on money held for a set period of time, which typically provides a higher return than a regular savings account) trying to earn interest because we know the more cash we have for that project, the less we’ll have to borrow,” Rasmussen said.
The report also shows the city’s debt capacity, or amount of money the City can borrow, at $20 million. Rasmussen again pointed to the wastewater plant and the need to carefully manage borrowing for other projects against saving up for that project.
The full report is printed in this week’s legal notices.
Contract approved for new City Hall remodeling
Stebral Construction of Iowa City was the sole bidder for remodeling the former Brosch Chapel and Event Center into Solon’s new City Hall with a $193,200.00 bid for the project. The scope of work includes flooring, lighting, workspaces, adding two offices in the large room upstairs, painting, and exterior work to include repairs to the deck, trellis, pond deck steps, brick pillars, soffit and facia, and moving the current upstairs exterior doors to the back of the building.
“We reached out to several companies and it’s just a busy time of year,” said Rasmussen. “We were glad to get one quote.
Work is to begin the first week of December with completion anticipated by the end of January, depending in part on doors and windows, which Rasmussen said had already been ordered as some of the finish work cannot be completed without them. She added the $193,200 is for the remodeling plus an additional $50,000 to Lite Windows (doors and windows), $1,700 for phones, $7,700 for security (doors), and $15,000 for security cameras. A quote for the council chambers audio/visual system had not been received.
“Our first phase is at $283,000,” said Rasmussen. The second phase will include geothermal and some outdoor site work. “We’ll just get in and then we’ll focus on phase two.”
The construction contract was passed unanimously.
Next meeting
The Council will meet in regular session Wednesday, Dec. 3 at 5:30 p.m. at City Hall (101 N. Iowa St.)