The Iowa Finance Authority on May 5 put a Court Avenue housing development proposal on the waiting list for tax credits, a step that virtually guarantees that the on-again, off-again project will get the credits considered essential for its construction.

Court Avenue Partners II LP, headed by Harry Bookey and Jim Hubbell, had sought low-income housing tax credits in its effort to build apartments and condominiums on Fourth Street south of Court Avenue. The IFA denied that application in March, but the developers appealed, contending that the board had made a technical mistake and knowing that $1.47 million remained after the IFA chose this spring’s winners.

The partnership now has the right to renew its request when the IFA board meets June 1. IFA spokeswoman Monica Seigel Fisher said sufficient credits remain to satisfy the requests of all four projects placed on the waiting list.

Court Avenue Partners II had sought $2.7 million in tax credits from the IFA – a sum that would be spread over 10 years — and $800,000 through the federal HOME program, but both requests were rejected. In 2004, Bookey and Hubbell received $3.7 million in credits for the planned redevelopment of the Spaghetti Works building but were turned down for $5.36 million in credits for new construction.

The city of Des Moines has agreed to provide $4.2 million upfront for new construction and $976,000 in ongoing subsidies to be paid in 34 semiannual installments of $28,707 beginning July 1, 2007. The city also would grant 100 percent tax abatement for 10 years for the residential portion of the project.

The developers’ plan calls for constructing a building at the southeast corner of Fourth Street and Court Avenue containing 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. A 40-unit condominium building would be constructed south of the apartment building.

For the nearby Spaghetti Works renovation, the city has agreed to provide a $1.1 million grant plus a $1.1 million subsidy to be paid in 34 semiannual payments of $31,355 beginning July 1, 2007. The project would benefit from 100 percent tax abatement for 10 years.

The Polk County Housing Trust Fund also awarded a $250,000 grant to the project.

Bookey and Hubbell plan to create 52 residential units on the upper floors of the Spaghetti Works building, which was recently placed on the National Register of Historic Places.