WATERLOO -- Developers of a new Social Security Administration office in the Greenbelt Centre will get property tax breaks.

Waterloo City Council members voted 4-2 Tuesday to approve a development agreement for the planned $1.1 million, 13,000-square-foot building north of the former Waterloo Greyhound Park.

Councilmen Bob Greenwood and Harold Getty opposed the pact with WATESSA Venture, based in Davenport, which will construct the building and lease it to the SSA. Councilwoman Carolyn Cole was absent.

"I just don't really agree with this," Greenwood said. "Tax abatements should be given to businesses when we're at a competitive disadvantage. It's going to be here anyway."

The city will provide 100 percent property tax rebates for four years, a fifth year at 68 percent and five more years of 50 percent tax rebates, designed in part to help WATESSA recover the $201,600 purchase price for the land.

The SSA office at 904 W. Fourth St. is not taxed because it is owned by the government. But the new leased building will be taxed because SSA is a tenant.

While Greenwood objected to giving up tax base for the federal government, Jeff Eirinberg, managing partner in WATESSA Venture, said those incentives were factored into the investment firm's successful bid for the project.

The General Services Administration, which handles construction of federal buildings, was looking for the lowest cost when choosing a developer. Eirinberg said the company only has a firm 10-year lease with SSA but hopes to keep them as a tenant longer.

Community Planning and Development Director Noel Anderson acknowledged the standard tax incentive program for that business park was quoted to the developers.

"I didn't treat them any different than any other private tax-paying development," Anderson said.

And Councilman Steve Schmitt, who supported the development agreement, said the city should stick to the offer presented to WATESSA originally.

"I'd be very concerned changing the rules in the middle of the game," Schmitt said.

Mayor Tim Hurley said the city tried for nearly three years to get the larger SSA office to located downtown. Parking was apparently the biggest hurdle, he said.

Eirinberg said the developing Greenbelt Centre location obviously met the SSA's needs.

"I think it's certainly an appropriate place for a class A office building to be located," he said.

Contact Tim Jamison at

(319) 291-1577 or

tim.jamison@wcfcourier.com.