Jim Hubbell had serious doubts about his Court Avenue redevelopment plan’s chances for success a week before the Des Moines City Council was to vote on it. But when the Nov. 8 meeting arrived, the last wrinkles between the developer and the city had been ironed out.

Five “yes” votes from the council – Archie Brooks voted against the plan and Tom Vlassis passed – gave final approval to a proposal to renovate the Spaghetti Works building and construct two buildings on that block that will house apartments, condominium units and retail space.

However, one obstacle remains. Although Hubbell assured the council that Court Avenue Partners I L.P. will create 52 residential units on the upper floors of the Spaghetti Works building, 302-310 Court Ave., the proposed new apartment building depends on low-income housing tax credits that have yet to be secured. The Iowa Finance Authority turned down a similar application last March.

“We’ll apply later this month for tax credits for the apartments at Fourth and Court,” Hubbell told the council. If he and partner Harry Bookey – operating as Court Avenue Partners II L.P. for the new construction project — are turned down again, “we’ll have to sit down and decide whether there’s a project there or not.”

In connection with the Spaghetti Works renovation, the city agreed to:

•Provide a $1.1 million grant to the developer.

•Provide the developer with a subsidy of $1.1 million to be paid in 34 semiannual payments of $31,355 beginning July 1, 2007.

•Grant 100 percent tax abatement for 10 years.

•Provide 75 parking spaces for 20 years.

In return, Court Avenue Partners II agreed to spend at least $10 million on the project and share any excess profits with the city. To meet the conditions of tax credits already approved for this project, Hubbell and Bookey must spend $1 million by the end of 2004. They expect to meet that requirement by purchasing the upper three floors of the building from its Omaha-based owner.

In respect to the new construction, the city agreed to:

•Provide $4.2 million upfront and $976,000 in ongoing subsidies to be paid in 34 semiannual installments of $28,707 beginning July 1, 2007.

•Grant 100 percent tax abatement for 10 years for the residential portion of the project.

•Provide 25 parking spaces for the apartment portion of the project.

The developer is required to construct a building at the southeast corner of Fourth Street and Court Avenue housing 8,500 square feet of first-floor commercial space and 52 apartments – half for low-income occupants and half to be rented at market rates – and construct a 40-condo building south of the apartment building and share any unanticipated profits with the city.

Hubbell said a $250,000 grant from the Polk County Housing Trust Fund for the Spaghetti Works project helped the two sides find a solution during final negotiations. Council member Christine Hensley represents the city on that organization’s board of directors, and said a serious debate preceded the awarding of the grant.

“It was the same discussion we have on every downtown project, because it’s costly to do these projects and they require subsidies,” she said. “The argument was that this project was more about economic development than low-income housing. I worked like crazy to get this grant.”