Government

Council approves Iowa Finance Authority building purchase

The Iowa State Capitol building in Des Moines, photographed on Tuesday, June 10, 2014. (Liz Martin/The Gazette-KCRG)
The Iowa State Capitol building in Des Moines, photographed on Tuesday, June 10, 2014. (Liz Martin/The Gazette-KCRG)

DES MOINES — The Iowa Executive Council voted 4-0 Monday to approve a request that the state buy an office building currently leased by the Iowa Finance Authority for $7.59 million and eventually co-locate the Iowa Economic Development Authority at the same site in southwest Des Moines.

Under the tentative arrangement, the Finance Authority will purchase the three-story office building it currently leases from Hubbell Realty located at 1963 Bell Ave. in Des Moines. That means the agency will own the building for the approximate cost of its current lease through 2030.

State officials said the total lease amount during this term would cost $7.5 million compared to the purchase price of $7.59 million.

The economic development agency will rent office space from the Finance Authority, with plans to move into the second and third floors of the building by next Jan. 1.

The two agencies will remain separate and operate under their own budgets.

“We believe it’s a good day for the taxpayers today. This was the right decision to make,” Debi Durham, executive director of both authorities, told reporters after Monday’s unanimous council vote.

“Without any question, I am supportive of this,” Durham added. “I think it allows us to move forward with aligning the two agencies to building the proper culture of the two agencies working together to solve problems for Iowa, and I believe it makes good financial sense.”

The Finance Authority, which administers affordable housing programs, plans to have an additional tenant occupy the first floor — probably another state agency or a not-for-profit organization to simplify the property’s tax status, Durham noted. The tentative agreement likely will not be finalized until September, she added.

Gov. Kim Reynolds fired the former head of agency, David Jamison, in March 2018 over allegations of sexual harassment.

Last year the state Appeal Board approved a $4.15 million settlement of a sexual harassment lawsuit brought by two women who alleged they were sexually harassed and assaulted by their former boss, Jamison, who led the Finance Authority from 2011 until he was fired. An independent investigation concluded Jamison did harass the women.

Shortly before he was fired, the council approved Jamison’s $17 million request to move the authority from its state-owned office at 2015 Grand Ave. and to enter a long-term lease for the building at 1963 Bell Ave.

Council members later said the decision was made without them being informed about a $6 million savings and a third-party recommendation that the agency stay put. Jamison had argued the move was necessary because of the current building’s poor condition and inability to meet the organization’s long-term needs.

On Monday, Durham said she had reached out to leadership in both political parties in the Legislature and key oversight committee chairs to discuss the planned purchase and agency realignments.

“All of them had questions about how we ended up here in the first place and I can’t answer that. All I can say is I inherited this decision,” she said.

During Monday’s council meeting, Reynolds — participating by speaker phone from the Republican Governors Association meeting in Colorado — thanked Durham for reaching a workable solution and said she supported the two authorities’ realignment into a co-location.

Secretary of State Paul Pate also participated by speaker phone while State Treasurer Mike Fitzgerald was absent when the vote was taken Monday.

The Finance Authority’s board approved the building purchase arrangement earlier this month.

• Comments: (515) 243-7220; rod.boshart@thegazette.com

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