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City officials seek watershed windfall

Dubuque council will consider applying for $98.5 million in state tax incentives for a massive flood-mitigation project that will cost $179 million over 20 years.

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Posted: Friday, November 15, 2013 12:00 am | Updated: 11:16 am, Fri Nov 15, 2013.

The Bee Branch Creek restoration project might be the face of flood mitigation in Dubuque, but city leaders say it's simply one piece of a much larger whole.

Completely eliminating the recurring flooding that has plagued the North End will require work across an entire watershed, hundreds of millions of dollars and multiple decades to complete. Fortunately, state officials appear to be offering a life raft.

On Monday, the Dubuque City Council will consider an application for $98.5 million in state tax incentives. The money would be applied toward a massive flood-mitigation project that will cost more than $179 million over more than 20 years.

If everything functions as planned, the project could prevent an estimated $582 million in damages over its 100-year design life, city officials estimate.

"Over 50 percent of the people in Dubuque live or work in the Bee Branch watershed, so it's a pretty significant, important place for our community," said City Manager Mike Van Milligen.

Since 1999, flood disasters within the watershed have prompted six presidential disaster declarations. Businesses and homes in that area have suffered nearly $70 million in damage.

In addition to efforts to "daylight" Bee Branch Creek, which was routed underground a century ago in the interest of downtown development, planned watershed improvements include sewer capacity enhancements and the replacement of a flood-mitigation gate. The city also will reconstruct 240 alleyways with pervious pavement that allows water to filter back into the ground instead of creating runoff, improving water quality as well as flood protection.

"With the damage that we've experienced to date, and it's been in the millions of dollars annually that we've averaged because of flooding in the Bee Branch watershed, this is a must-do project," said Assistant City Manager Teri Goodmann, adding that experts have a "rule of thumb" for disaster-prevention projects. "For every $1 invested in mitigation of a disaster, you save the state $4, or the citizens ultimately are going to save $4. This is part of preparation and readiness and being a resilient community."

The project has been around in some form since the City Council adopted a drainage basin master plan in the early 2000s. Early estimates attached an approximate 50-year time line to the project, but the creation of the Iowa Flood Mitigation Board could speed things up considerably.

The board, created through legislation two years ago, will start reviewing applications for assistance with major municipal flood-mitigation projects next week. Board members must determine how best to divvy up $600 million in funding drawn from future state sales tax revenue.

Dubuque's proposal calls for a 12-phase project, three of which already have been completed, Van Milligen said. The $98.5 million allocation would be applied in pieces as the city issues new debt and completes project phases over the next two decades.

"Our application asks for money over the entire 20 years," Van Milligen said. "Our dollars would be used to pay off debt and also do some projects, pay as you go as the expenses come up."

In addition to speeding up the project time line, the allocation would ease the financial burden on residents' utility bills, Van Milligen said.

The council previously adhered to a fee schedule that would have raised the base monthly residential stormwater utility rate to $7 last fiscal year and to $9 by 2017. When the possibility of state funding was announced, the council decided to hold utility rates to $5.60 this year, and they wouldn't increase to $9 until 2022 if the city gets the allocation, according to Van Milligen.

"Instead of 50 years or more, it's all going to be done in 20 years, with most of it being done in the next six years," he said. "We think there's just unbelievable benefit. A lower cost, and a more accelerated schedule, if we're so fortunate as to get this allocation from the state."

Allocations are competitive, and Cedar Rapids, which was devastated by flooding in 2008, is expected to claim a healthy portion of the total available funding. But Van Milligen believes Dubuque's request likely will be viewed as reasonable by the board because it's spread out fairly evenly over the course of the program's lifespan.

Under the legislation, $30 million per year for 20 years can be allocated.

"We made a real effort to structure this so that we minimized our annual asking," Van Milligen said. "In no case did we ask for $7 million in a year."

Dubuque's application also includes planning for future maintenance needs, said city civil engineer Deron Muehring, and that could bolster its chances.

"This is an important point of the board," Muehring said. "If (they're) going to spend the money to implement measures to mitigate flooding, (they) want to make sure that people are thinking about the maintenance of it, make sure it functions when it needs to."

Assuming the City Council signs off on it, the city's agent will present the application to the Iowa Flood Mitigation Board on Nov. 21. Van Milligen said the board could make a decision on the application as early as its Dec. 4 meeting.

Even if the board rejects the proposal, the city will pursue the full project, according to Van Milligen, albeit on a greatly expanded schedule. But he said he believes the funding program could mean great things for the city.

"Now we know what it means -- it means really big news and really good news for Dubuque, Iowa," Van Milligen said.

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