City Manager John Harrenstein, describing a development proposal with Lotus Community Project Inc, told City Council of Webster City Monday that Lotus "showed a strong willingness to work with us on this project." If completed, the Lotus building at 707 Second Street, would see structural repairs to correct years of neglect, and creation of two new rental apartments upstairs, which Harrenstein called "a project in which we can start to resolve two pressing problems we see downtown."

The City Council of Webster City on Monday considered a proposed agreement between the city and Lotus Community Project Inc. with potential to address two of the city’s biggest problems: deteriorating buildings downtown and a shortage of housing.

The agreement, if implemented, could stabilize the building at 707 Second Street and provide newly-renovated apartments on the second floor.

It’s a new and innovative approach to an old problem: keeping downtown Webster City viable.

A short review reveals much has already been tried to “save” downtown.

In the last 35 years, a number of buildings have been demolished, including the former Bacon’s Gift Shop and adjacent buildings (today’s Availa Bank Plaza).

Some residents will remember the building at Willson and Second that housed the first Webster City Fareway store and its neighbor, Fuh’s Bakery. Both were torn down when shared interior walls became unstable.

Shared walls are common downtown and remain a serious threat to remaining buildings.

Restoration is the opposite of demolition and it came to downtown in a big way with the formation of LIFT Webster City. The organization is nearing completion of its main project — restoration of The Elks at 713 Second Street. The project has been funded with grants, a forgivable loan, and cash gifts. It’s the most significant modern-day attempt at historic restoration of a downtown building in Webster City.

On the statutory side, the City of Webster City has been stepping up documentation of potentially dangerous situations in downtown buildings and following up with enforcement action. The all-too-visible concrete and chain link fence barricades attest to this.

Where no other remedy exists, the city has acquired or helped to acquire derelict property — 608 Second Street, formerly Bettis Appliance, and 547 Second Street, which was once home to Coulter’s Paint Store, are two recent examples.

The latter faces an uncertain future. If torn down, it will leave a large vacant lot at an important corner and render unstable its adjacent neighbor to the east.

The building at 608 was saved with the help of LIFT WC. It was stabilized after a ravaging fire and is on the market for someone eager to tackle a challenging renewal.

The building at 707 Second Street houses Lotus Treasures, a consignment-thrift shop. The second floor is vacant.

Earlier this year a storm ripped the sheet metal facade off the building’s east wall, exposing a one-inch crack in the masonry running the height of the brick building. An engineering report, paid for by the city, shows the building is capable of being restored.

However, that east wall is barricaded for safety, which means volunteers and patrons of the shop occupy and use the building at their own risk. Minor work was recently done on the roof to prevent further deterioration.

The building was purchased by Lotus in 2021. Lotus is a nonprofit headquartered in Vincent. The shop provides income for Lotus’s wider mission, which is to support families experiencing domestic violence and housing insecurity.

The proposed agreement, which is unprecedented in the city’s history, would see the city and Lotus as partners in what’s formally called “a deferred loan and development agreement” to repair the building’s defects and develop two rental apartments upstairs.

If the project proceeds as planned, with the building stabilized and the apartments certified for occupancy, the city would begin forgiving the loan at a rate of $20,000 a year until fully liquidated or if Lotus sells the building. The full amount of the proposed loan is at present unknown.

Should a sale be proposed, the city retains an option to buy the property on a first-right-of-refusal basis.

City Manager John Harrenstein, who explained the concept to the Council Monday evening as “an idea, one you may feel has merit or one you may feel isn’t appropriate here,” has used similar agreements in other cities where he’s worked.

He went on to say the funding for the building repairs would come from the city’s Low-to-Moderate Income housing fund, which is generated by Tax-Increment Financing (TIF) districts.

The fund is believed to have approximately $500,000 available at present.

Councilman Logan Welch called the agreement “a unique approach” and said he supported looking further into details of the deal.

Councilman Matt McKinney stated, “We have to be creative,” also suggesting he was in favor of investigating the proposal further.

Mayor John Hawkins said that “anytime the city does a project it’s going to cost more.” He recommended that LIFT, of which he is a member, manage the project rather than city staff.

New housing of any kind is much in demand in Webster City. A recent update to the Webster City Housing Study forecasts employment growth of 4.1% in the Fort Dodge/Webster City region from now through 2030, or about 1,760 new jobs. A number of those expected new residents could be attracted to Webster City if adequate housing was available.

An additional 150 to 235 new housing units must be built by 2030 to take advantage of the projected growth, and the report specifically cites housing downtown as an opportunity:

“Housing can be an important ingredient in remaking downtown, and downtown Webster City has many excellent development opportunities that, in turn, can address such issues as a scarcity of rental units.”