Is this why the cost of rehabbing the former Federal Courthouse sky rocketed?

August 8, 2011 Lisa Kuzela
Okay, here’s the ENTIRE file I found (from SOS site). All of these LLCs have William Prowell listed as the organizer / registered agent. He is an attorney for Shuttleworth and Ingersoll, (one of the big firms the City has monopolized). He is also Chair of the Neighborhood Development Corp(another of the many scam non profits here in Cedar Rapids). His name has also shown many times with other organizations that I researched that donated $$$ to Vote Yes for 20 more years of sales tax.
All of the following 3 LLCs were FORMED APRIL 2011. (NOTE: there are NO officers listed for ANY of these LLCs. I am REALLY anxious to see who they are!)

1. Courthouse II LLC is leasing from the City of Cedar Rapids the former Federal Courthouse (and future City Hall) for 99 years, then leasing it to Courthouse II Tenant for 32 years.

Courthouse_II_LLC_Certificate_of_Organization 1.jpg (JPG — 32 KB)

2. Courthouse II Manager LLC is overseeing all the building and rehabbing of the former Federal Courthouse (sounds like a “consultant” to me.)

Courthouse_II_LLC_Restated_Articles 2.jpg (JPG — 54 KB)

3. Courthouse II Tenant LLC is leasing the courthouse from Courthouse II LLC for 32 years. So, the City OWNS the former Federal Courthouse and is leasing it to Courthouse II for 99 years (probably for $1 like they always do for their friends), who is basically also leasing it back to himself (Courthouse II Tenant LLC) while managing the rebuilding. The CITY is getting the funds for the rehab, like from I-Jobs, etc.

Courthouse_II_LLC_Summary_-_William_Prowell_atty_ShuttlworthIngersoll 3.jpg (JPG — 45 KB)

So, we are actually paying for the rehab, but having Courthouse II Manager oversee everything (like John Frew with the Events Center). This all sounds like a glorified and indirect (not to mention sneaky) way to hire another overpaid consultant.

Courthouse_II_Manager_LLC_Certificate_of_Organization 4.jpg (JPG — 35 KB)

Courthouse_II_Manager_LLC_Restated_Articles 5.jpg (JPG — 55 KB)

Courthouse_II_Manager_LLC_Summary 6.jpg (JPG — 46 KB)

Courthouse_II_Tenant_LLC_Summary 7.jpg (JPG — 50 KB)

Couthouse_II_Tenant_LLC_Certificate_of_Organization 8.jpg (JPG — 34 KB)

Is THIS why the cost of rehabbing the former Federal Courthouse sky rocketed?
See attached Council Agenda and Packet from April 12, 2011, 5a and 6a:

5a) Following up on my latest discovery, it was April 12, 2011 that Council approved leasing the CITY-OWNED former Federal Courthouse (new city hall) to Courthouse II LLC for 99 years, “ownership of which entity may later be assigned.”

Hmmmm… This also sounds like another project in which the taxpayers pay for everything, then the City will be selling it on the cheap to their friends – another Sinclair? Ice Arena?

HOWEVER, Courthouse II LLC was not even established at the time Council voted to do this! This LLC was established (papers signed) April 14, 2011 (see attached file from Secretary of State regarding this subject).

6a) This same council meeting, April 12, 2011, Council then approves leasing the building back to themselves from Courthouse II Tenant for 19 years. Courthouse II Tenant was also not formed until April 14, 2011.

Staff used the excuse that the City was ineligible to receive State and Federal historic tax credits toward the old Federal Courthouse unless they put it in the hands of another eligible entity. If this was the case, then why 19 years? NINETEEN YEARS our taxes are going to go to pay rent on a building that taxpayers OWN??!
In the interim, Courthouse II Manager LLC will be overseeing all the rebuilding. Sounds like a sneaky way Council got around putting bids out for this project, less transparency, and a backdoor method to get around voting for yet another OVERPAID “consultant,” while passing along the wealth to more of their friends. WHO ARE THESE “Managing” PEOPLE?? What are their qualifications?

Council continues to vote to make agreements with LLCs and non profits that don’t even exist until they have secured funds or agreements from our City Council! I was told recently they did the same thing with Transitions Made Better, voting to give her funds before she even officially filed her non profit. I haven’t check on that yet. But, I DO know the Council approved the formation of the Neighborhood Development Corporation (NDC) and at the same meeting agreed to support giving them $1.5 million, it was a city staffer who presented the formation of the non profit is now the paid CEO for that non profit – Marty Hoeger! NDC has received State, Federal (CDBG), and now recently the City gave them another $100,000 and with NO accountability for where the money has gone. NO QUESTIONS ASKED! Oh yeah, and Christine Butterfield, the City’s Community Development Director in charge of all this is also on the NDC Board. If they want any money, she just gets it on the consent agenda for them and Council rubber stamps it.

And let me point out another thing that shows the incompetence and carelessness of our City: Council agrees to these resolutions without FIRST seeing the contracts and without knowledge of the cost of these leases!
When I was on the School Board, before we voted to pass any “contract between the District and another entity,” we had that contract in front of us before we voted on it, so we can ask questions or change things. The City does not do it that way at all.

I asked for a copy of the Pro Source contract right after they approved hiring them for another service, and the Chair of the Procurement Committee said, “well they have to write it first.” I said, “you mean you approved a contract that wasn’t yet written?” This is standard procedure with our city!

Read the attached resolutions 5a and 6a. “NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CEDAR RAPIDS, IOWA that the City Manager and City Clerk are authorized and directed to execute the Lease Agreement and all associated documents necessary with Courthouse II, LLC, subject to legal review, contract terms, and final documents, and to be consistent with any governing rules and regulations.”

What FUNDS (and sources of funds, CDBG? FEMA?) are being used for the rehab of this Courthouse. I do know about I-Jobs (State bonds), but what else?

What is the cost of rehab up to now, and when did it increase so much?

And HOW is the CITY using the courthouse if Courthouse II is leasing it back to himself (Courthouse II Tenant) for 32 years?
It sounds like the City will have to therefore PAY RENT to Courthouse II Tenant LLC, even though the City owns the building!!!?? WHY is this being done?

THIS SOUNDS LIKE ANOTHER one of Cedar Rapids’ SCAM to help their rich friends get richer on the backs of us taxpayers!!! Isn’t this illegal? If not, it should be! It’s OUR taxes!

Then they have their hand out continually for MORE taxes!

See “Signs of Progress” here

UNBELIEVABLE!!!!!!!

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About Ajai Dittmar

There is nothing 'radical' about wanting to save your historical neighborhood! There is nothing 'negative' for wanting an 'outside investigation' done a public service that has had a lot of embarrassing news, especially when they don't do their jobs! There is nothing 'odd' about wanting politicians to uphold the Constitution they swear to uphold when they are sworn into office! Follow @sibzianna View all posts by Ajai Dittmar

6 responses to “Is this why the cost of rehabbing the former Federal Courthouse sky rocketed?

  • page

    With a staircase before you, you look for a rope to go down by.

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  • Kamala Witcher

    i never read the all comments somewherelse..ha ha ha hareally really funny

  • Tom

    One more thing.

    If they have turned over “Owernship of the Property” which it appears they have done in the LLC docs (3) at the SOS, then the New Owners LLC II should reapply for ALL the FUNDS.

    Only the Governor can make this happen, any other state agency or official WILL be a waste of time !!!

  • Tom

    1. They are doing it so they can get around the Competitive Bidding Requirements.

    2. They are doing it so they can hand out the construction work to their buddies down at the chamber.

    3. They are doing it because they can borrow more money (They are lying that the citizens are only paying $1 Million) as they are borrowing money in the form of bonds.

    4. They are doing it as the building will be managed by a Private Person and then no longer public property so they can through you and the others off the property anytime they want to…. Don’t belive me, time will tell and you all will be laughing stalks of the city (its their plan, not mine).

    5. Yes, it is illegal and this is how you can stop it.

    A. Call the Governor’s Communication Officer in Des Moines.

    B. Tell him the city has set up a LLC at a building where State I-Job funds ($1.1 Million) are being used.

    C. Tell him the City is not using Competitive Bidding since a private Corporation now controls this Building and the State’s Money !!!!

    YES, ITS ILLEGAL – IF YOU and others will only get off your a$$es and do something about it. AND NOT JUST WHINE ABOUT !!!

    • Ajai Dittmar

      Hey Cooper- why don’t you get off your fat ass and do something about it?! You seem to have all the information and ‘know how’! You have no idea what we are doing or what we have done and at this rate you never will. YOU CANNOT BE TRUSTED YOU HAVE PROVEN THAT!!!

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