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HomeMy WebLinkAboutCady Gerlach - ICAD.Better Together 2030IOWA CITY I AREA DEVELOPMENT BETTER Business �� [IOWA CITY A TOGETHER Partnership SOUTM OF 6 -2030 — Statement of Interest: Inclusive Economic Development Support for Underestimated Businesses and Entrepreneurs for the City of Iowa City American Rescue Plan Act (ARPA) Local Relief Fund Cover Letter: This Statement of Interest is submitted in line with the All in Vision of the six nonprofit community economic development agencies operating in Iowa City, including the Iowa City Area Development Group (ICAD), the Iowa City Downtown District (ICDD), the Iowa City Area Business Partnership (ICABP), Think Iowa City (TIC), and the South of 6 Iowa City Business District (So.6), and their joint nonprofit community development corporation, Better Together 2030 (BT2030). Those specific partners responsible for implementation of various projects outlined in the Statement of Interest are defined within the proposal, but each play a role in supporting and ensuring the growth and success of the inclusive economic ecosystem that is evolving and developing in Iowa City and will play a future role in engaging and ensuring the success of these programs. Because they will house the funding and staffing, Iowa City Area Development Group (ICAD) is the lead applicant on this proposal with the support of each and Better Together 2030 and partners identified above as co -applicants. The partners outlined above were instrumental and critical in the development of the Inclusive Economic Development Plan (IEDP) led by Astig Planning over the previous years with ICAD and the ICABP leading its commission. These six organizations have committed to the implementation of the Inclusive Economic Development Plan through the Better Together 2030 All in Vision and have supported the implementation of the Iowa City Strategic Plan across the entire community. In that plan, the City identified ARPA funds that will be essential to the execution and implementation of the IEDP and overcoming the structural barriers identified therein. Our partnership and project ideas bring together those organizations in Iowa City who understand the importance of, and potential created by these funds to support those underestimated communities who are leading this effort. By working together, we can leverage our collective expertise and resources to support economic development that is both inclusive and sustainable, all while building capacity of the next generation of leaders and breaking down systemic barriers and systems. Throughout this process, we each received multiple requests for Letters of Support for various projects and responded to those we were able to, while recognizing that as existing community economic development organizations with proven capacity and commitment to dismantling systemic barriers for underestimated communities, we will also stand ready to support and nurture those projects that IOWA CITY L�� BETTER AREA OEVEEOPMENT Business [IOWAp CITY TOGETHER Partnership - SOUTH OF 6 2030 , emerge as funded that meet the opportunities identified in the Inclusive Economic Development Plan by the City. Much of the reason we have chosen the paths identified here is that it will allow us to make sure we are able to answer and support each of the projects and teams that have reached out for specific technical assistance and services, collaboration in their project teams, partnership, and support through this application process. This project answers those calls and requests for support. Additionally, as we developed this statement of interest and project planning it became clear that there are three projects and scopes of work that our organizations can offer, provide both support in, and project planning and management of. Those projects are: (1) Business Support Programming; (2) Support for Physical Space Grantees and Development; and (3) Nurturing the Inclusive Economic Ecosystem. Because of the multi -faceted nature of these projects, the application falls into both funding categories for both physical space and business support programs. Proiect Descriations: Goals. Puraoses, and Benefits & COVID-19 Recovery Resilience Proiect l.Business SUDDort Programming: We are pleased to submit a proposal for an inclusive business grant program for underrepresented and underestimated businesses. Our program will support small businesses owned by BIPOC, women, LGBTQIA+ and other marginalized groups that have been historically excluded from traditional funding sources, communities that the IEDP identifies and defines appropriately as "underestimated." We believe that the ARPA funds can play a critical role in helping us achieve this vision. Specifically, we are interested in leading a sustainable grant program that supports small businesses and entrepreneurs who have been disproportionately impacted by the COVID-19 pandemic. We recognize that these groups often lack and historically were denied access to the resources and support they need to thrive, prominently so in the COVID-19 pandemic benefit and resource programs offered by the federal and state governments, and we are committed to filling this gap. We also acknowledge and recognize that any of this programming offered must be both by and for underestimated community members. We are confident that our partnership is well-equipped to manage this program, given our extensive experience in economic development and community engagement. Our collective network of business leaders, community members, organizers, entrepreneurs, and civic and government leaders ensures that we have the knowledge and relationships necessary to create an effective and impactful program. IOWA CITY L�� BETTER AREA DEVELOPMENT Business [IOWAp CITY TOGETHER Partnership SOUTH OF 6 2030 v sus Hess s ssmr Importantly, also, we have all recognized the nature of using this opportunity to develop the capacity of underrepresented persons and organizations to both operate and make decisions with these funds. We believe our role can be administrative and distributive in nature, while also capacity building for others with our existing experience and systems. We will offer grants ranging from $2,500 to $25,000 to qualifying businesses with the goal of targeting at least 30 businesses. These grants will be used to help cover operating costs, supportive professional services, purchase necessary equipment or inventory, and provide support for marketing and advertising efforts. The IEDP identified professional services as a primary gap in access for the affected communities and this project, through a coordinated approach, will also develop a system of shared professional services providers made up of previously underrepresented groups where possible and available. This will be critical to future capacity and accessibility and vetting these contractors and creating this network of providers will prove invaluable to the future needs of these businesses. To ensure the success of the program, we will hire one staff member who will be responsible for managing the application and selection process, coordinating with grantees and committees, and tracking program outcomes. We will also enlist the help of experienced mentors and advisors from the local business community who can offer guidance and support to our grant recipients while building the capacity of underestimated businesses to operate. The project would be housed at the Iowa City Area Development Group with a total grant budget of $500,000 with the goal of supporting underestimated businesses to lift them to health and sustainability into the market. The grants would be a pot of $500,000 and would support the staff member with $75,000 per year for a three- year process'. This staff person would convene a paid grants committee that is made up of a 75% majority (super majority) of underestimated decision makers. We would pay each committee member for their time and efforts on behalf of the program. Grant amounts would be based on the committee's determined criteria, which could include operational history, existing businesses — pop ups — entrepreneurs, and the demonstrable market for the product or service. The success of this program requires that decisions are being made by and for these same community members, so this review committee will be made up of business owners and community members and leaders who represent the diversity of our community who would be paid for their time. This committee will be 11 This staff member should identify as from an underestimated community and could be housed at ICAD with the grant management responsibilities and ecosystem development opportunities identified in this proposal while supporting the Pillar 4 work of the Better Together 2030 All in Vision Community Development work. IOWA CITY L�� BETTER AREA OEVROPMENT Business [IOWAp CITY TOGETHER Partnership 030 SOUTH OF 6 2 ������ Iowa v sus Hess o ssmr -^�•^ ^ �-• responsible for reviewing applications, conducting interviews, and selecting grantees based on their eligibility and alignment with the program's goals. The success of this program will be measured not only by the number of businesses supported, but also by the long-term impact that our grantees are able to achieve. We will track outcomes such as job creation, revenue growth, and community impact to ensure that our program is making a meaningful difference in the lives of those we serve. Additionally, there is an opportunity here to make sure we are sharing the anecdotal stories and efforts that are coming through this grant program that may not be quantifiable but will be important to track and share. We know that these types of programs work as we have seen their success in the Builders and Backers program operated by ICAD with the support of Heartland Forward. Through these programs, ICAD has been able to serve 23 participants so far with more in each cohort: 4 Immigrants have been served, and participants are 690/0 Female, 31% Male, 52% Caucasian, 31% Black/African American, 4% Hispanic/Latino, 4% Asian, 9% Non -White / other. These statistics are identified from previous cohorts, upcoming cohorts are expected to be increasingly diverse due to recruitment efforts and referrals from past Builders and awareness of the program, especially women, and increases in racial diversity as well. The Builders and Backers program has also established a network of service providers and professional services that are able to help small businesses where they are in the process and help nurture their success. Additionally, South of 6 and the Iowa City Downtown District will be able to provide specific support to each of the businesses located within their respective districts and promotion of the activities, as well as location -based marketing and support. Think Iowa City has previously operated an ARPA grant for the City of Iowa City and could offer knowledge to ICAD to ensure compliance, reporting, and recordkeeping practices are established at the outset. These partners are all Better Together and they know that a collaborative project would make an enormous impact. To ensure sustainability, we intend to both fundraise through private investment and seeking matching funding with local banks2 to help continue this program (much as how the Wage Enhancement Program will work and the Project Better Together BIPOC Business Grant programs3 worked in years past), as well as establish a "give back" program where grantees commit to providing a return on 2 See Item #3 in proposal. 3 The Project Better Together BIPOC Grant program is specifically called out in the Inclusive Economic Development Plan as a model for success that, with appropriate funding and additional underestimated community involvement, could be the answer to many of the barriers identified by those business owners who participated in the study and provided feedback. IOWA CITY THINK L�� BETTER AREA OEVEEOPMENT Business [IOWA CITY �� TOGETHER Partnershipsour" of e 2 the investment to the program in future years with their time, talents, and treasure. While the scope of the return may change with each grantee, we believe that this program will create mentoring opportunities, meaningful relationships, and such change that grantees will be able to pay it forward to future grantees accordingly. Bud,aet: $500,000 Grants + Programming $225,000 Salary + Fringe4 $5,000 Grants Committee Pay Sources: IEDP ARPA Grant Private Fundraising/ICAD Investment as matching Campaign (Project #3) will increase this budget and funding for granting. Timeline: Begin once contracted and no later than January 1, 2024 Any ARPA funds fully spent by 2026 with private investment continuing program into perpetuity. Proiect 2. Support for Phvsical Space Grantees and Development: Whatever infrastructure and physical space is selected for granting by the City that is in line with the IEDP and City's Strategic Plan, we intend to support that effort and ensure its success. By doing so, this program has the potential to create significant impact in our community. By supporting this infrastructure development, we can promote greater diversity, equity, and inclusion in our economic development ecosystem. This will lead to more innovative and sustainable organizations that are better equipped to meet the needs of our community. Additionally, this program will help to strengthen the partnerships between established economic development organizations and emerging community development organizations. By working together, we can leverage our collective resources and expertise to support the growth and success of underrepresented communities. One service that our organizations are able to provide through our community development corporation is project management and development services for community projects in line with the Better Together 2030 All in Vision. The Better Together 2030 team can offer project management and support services towards 4 This position could also support Item 3. IOWA CITY L�� BETTER AREA OEVEEOPMENT Business [IOWAp CITY TOGETHER Partnership �awa�r.a���Esso9rw��. SOUTH OF 6 2030 , both small- and large-scale community wide projects and development opportunities. The teams, stakeholders, supporting organizations and staff of BT2030 and our partners are able to not only help with and amplify community projects in line with the vision that occur organically in the community and the BT2030 pillar workgroups, but also provide support for community development projects throughout Iowa City and greater Johnson County. BT2030 project teams have a working knowledge of local issues and established partnerships across the community and relationships with experts and key contacts in Iowa City, including in the fields of local, federal, state and private foundation grant and loan programs, knowledge of local, federal, and state laws, rules, and regulations for grant and loan programs and other financing opportunities. BT2030 teams and partners have a working knowledge and education in local, state, and federal community planning and development principles and practices, grant writing and grant administration, and of grant management information systems, financial reporting, and local, federal, and state fiscal management rules and regulations. In this case, we would ensure that the project management is led by those underrepresented communities identified in the IEDP and supported administratively to help build capacity. BT2030 can offer scaled solutions, from convening community brainstorming and asset mapping that evolve into strategic opportunities, as well as project management and administration of development projects as appropriate. If appropriate, we could provide a specifically tailored development services proposal that would outline the scope of services, timeline, project management opportunities, and clear and measurable expectations.5 The Better Together Community Development Corporation entity currently holds three project funds at the Community Foundation of Johnson County who acts as fiscal agent for 501(c)(3) activities. An additional fund could be established or BT2030 could act or help create a new holding entity where appropriate. Budget: The budget for this proposal is undetermined at this time depending on the scope of services needed. The key is that the community development activities undertaken would need to be led by and for the underestimated stakeholders with BT2030 acting as administrative and development support functions, thereby increasing community development capacity and activities of underrepresented community members as well. 5 What would be crucial to this is that the person who runs this specific project management and development services for BT2030 be a community member that identifies as from an underrepresented group and the capacity to build trust and support. IOWA CITY L�� BETTER AREA DEVELOPMENT Business [IOWAp CITY TOGETHER - Partnership SOUTH OF 6 2030 Timeline: This work could begin as immediately as requested and would ensure project completion prior to 2026 year-end. Proiect 3. Nurturing the Inclusive Economic Ecosystem: As organizations committed to economic development, we recognize and value the importance of creating an inclusive economic ecosystem in Iowa City. We also have seen incredible numbers of people interested in engaging in this ecosystem now through this IEDP ARPA process. We do not want to lose any momentum our community has, while recognizing there will be gaps in funding that are created and projects that may not be fully funded. This project aims to reduce any loss in the opportunities that could emerge from this unique funding round and nurture and support economic and community development partnerships that have materialized because of the previous three years. Better Together 2030 partners have a unique opportunity and relationships with other funding applicants to help convene and coordinate this effort. To achieve this goal, we propose a plan to learn from other communities around the country with similar size and economies which will inform our local work, as well as lead to a larger campaign to fund the activities which arise from the Inclusive Economic Development plan, current inclusive economic ecosystem ideas, and these IEDP ARPA applications into perpetuity. Bringing together the applicants from this process and continuing to develop their ideas, interests, and abilities is an opportunity that may not come around again and the chance to develop these emerging organizations and solidify their position in the ecosystem must not be wasted. Our first goal is to identify and learn from best practices from other communities to create a more inclusive and equitable economic ecosystem in Iowa City. Specifically, we aim to: • Identify successful programs, policies, and initiatives in other communities that promote economic equity and inclusion in those of similar size and economic qualities. • Adapt these best practices to the unique needs and challenges of Iowa City. • Implement these best practices to promote greater economic equity and inclusion in our community. • Use these relationships and practices to inform and develop a campaign to fund the projects that emerge through this process with capital campaign IOWA CITY L�� BETTER AREA OEVROPMENT Business [IOWAp CITY TOGETHER Partnership SOUTH OF 6 2030 v sus Hess o T—T infusions that are coordinated, collaborative, and impactful, just as the "Greatest Small City for the Arts" campaign did so successfully recently.6 To start, this will involve a comprehensive review of successful economic equity and inclusion initiatives in other communities around the country. We will conduct research, interviews, and case studies to identify best practices that are transferable to Iowa City. To date, conversations and initial interviews have occurred with the Arch Grants program in Missouri, who then shared Tulsa and Louisville as potential learning sites. There are additional cities like Madison and other Big10 communities that have begun various programming that can be learned from. We will then work with community stakeholders, including business owners, policymakers, and community leaders, to identify the best ways to adapt these practices to the unique needs and challenges of our community. We will also develop the actions for implementing these practices in Iowa City, with a focus on promoting greater economic equity and inclusion. This could then inform the wide - scale Iowa City Inclusive Economic Ecosystem capital campaign and Steering Committee to fund those projects which have emerged from this application process as funded but that still have capital gaps that must be filled or new ideas that emerge from the process. This will ensure that there is coordination and collaboration that we learned is so important and necessary in the Project Better Together days, which allowed Better Together 2030 to emerge and create a united community vision for a shared future. The Better Together 2030 partner organizations could help guide this continued inclusive economic ecosystem work as a partner while ensuring there is no hierarchy of power and that shared systems and hub/spokes emerge. The program will be guided by a steering committee made up of representatives from diverse and representative sectors of the community, including business, government, and community organizations and those applicants to this program. This committee will provide oversight and guidance throughout the program, ensuring that the program is aligned with the community's values and priorities defined in the IEDP, All in Vision, and Strategic Plan. This has the potential to create significant impact in our community. By identifying and adapting best practices from other communities, we can promote greater economic equity and 6 This idea is credited to and was shared with our groups from Iowa City residents Karen Kubby and Simeon Talley as an opportunity to help close the funding gap on the amazing projects that people became aware of through this ARPA funding round. The Greatest Small Ecosystem for Inclusive Economic Development isn't the catchiest name, but it certainly speaks to the relationships and abilities of our vibrant and authentic communities. These two would no doubt be committed champions of the process and would bring others along. IOWA CITY L�� BETTER AREA DEVELOPMENT O Business [IOWAp CITY TOGETHER - Partnership SOUTH OF 6 2030 v sus Hess s Ts T inclusion in Iowa City. This will lead to a more diverse, innovative, and sustainable economy that is better equipped to meet the needs of our community. Additionally, this program will help to strengthen partnerships between community stakeholders, including businesses, government, and community organizations. By working together, we can leverage our collective resources and expertise to create a more inclusive and equitable economic ecosystem in Iowa City. We are excited about the potential of this program to promote greater economic equity and inclusion in Iowa City. We believe that by learning from other communities and adapting best practices to our unique needs, we can create a more inclusive and equitable economic ecosystem that supports the success of all members of our community. Budget: Dependent on scope, $75,000 to begin exploratory trips, planning, and execution of initial ecosystem tours and requires the staff support as outlined in Item #1. Scope of project budget beyond initial stages will be formalized if interest is there. No funds have been committed at this time — the capital campaign budget would be formalized once projects are funded and determine their gaps. Timeline: This project could begin immediately and the initial infusion of funds would be spent by 2024. The campaign and larger funding initiative would run through 2025-2026 to help close the gap on funding for projects identified from this process. Organizational Capacity Statement: Iowa City Area Development Group submits its three years of financial statements and has ability to perform appropriate grant and financial management for the city, state, and federal funds it receives. ICAD has appropriate board and system oversight and regular audited financial statements. A federal single audit would be performed if federal financial expenditures exceeded $750,000 annually. If any contracts are executed following July 1, 2023, it would be the new merged entity of ICAD and the Business Partnership. With these three project ideas, we submit our support and requests for your consideration. We look forward to sharing more with your decision -making committee. Better Together 2030 Iowa City Area Business Partnership Iowa City Area Development Group South of 6 Iowa City Business District Think Iowa City Iowa City Downtown District IOWA CITY AREA DEVELOPMENT GROUP FINANCIAL STATEMENTS YEAR ENE IOWA CITY AREA DEVELOPMENT GROUP TABLE OF CONTENTS YEAR ENDED JUNE 30, 2020 INDEPENDENT ACCOUNTANTS' REVIEW REPORT FINANCIAL STATEMENTS STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS STATEMENT OF FUNCTIONAL EXPENSES NOTES TO FINANCIAL STATEMENTS CLAconnect. om LLP . CLAconnect.com INDEPENDENT ACCOUNTANTS' REVIEW REPORT Board of Directors Iowa City Area Development Group Iowa City, Iowa We have reviewed the accompanying financial statements of Iowa City Area Development Group (a nonprofit organization), which comprise the statement of cash receipts and disbursements and the related statement of functional expenses for the year ended June 30, 2020, and the related notes to the financial statements. A review includes primarily applying analytical procedures to management's financial data and making inquiries of entity management. A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, we do not express such an opinion. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the cash basis of accounting described in Note 1; this includes determining that the cash basis of accounting is an acceptable basis for the preparation of the financial statements in the circumstances. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Accountants' Responsibility Our responsibility is to conduct the review engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the American Institute of Certified Public Accountants. Those standards require us to perform procedures to obtain limited assurance as a basis for reporting whether we are aware of any material modifications that should be made to the financial statements for them to be in accordance with the cash basis of accounting. We believe that the results of our procedures provide a reasonable basis for our conclusion. Accountants' Conclusion Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in accordance with the cash basis of accounting. �A CLA is member or an independent member of Nexia International, a leading, global network of independent Nexia accounting and consultingflrms.Seenexia.com/member-firm-disclaimer for detaiIs. Intematlonal tl� Board of Directors Iowa City Area Development Group Basis of Accounting We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared in accordance with the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our conclusion is not modified with respect to this matter. CliftonLarsonAllen LLP Cedar Rapids, Iowa September 2, 2021 (2) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS JUNE 30, 2020 RECEIPTS Merge/808 Rent Contributions Grants Sponsorships Events Strategic Doing Interest Miscellaneous Total Receipts DISBURSEMENTS Salaries Payroll Taxes and Employee Benefits Insurance Rent, Parking and Property Taxes Utilities Office Expenses Marketing Travel Meetings Conferences Professional Fees Collaborative Expenses Staff Expenses Education Sponsorships Investor Relations Board and Committee Expenses Event Expenses Miscellaneous Total Disbursements RECEIPTS OVER (UNDER) DISBU Cash Balance - Beginning of Year CASH BALANCE - END OF YEAR See accompanying Notes to Financial Statements. Co -Working Seed Fund Merge at 808 ICR Management $ 174,191 $ 39,079 $ 7,500 40 174,231 39,079 - 7,500 88,379 - - 42,881 3,703 3,703 - - 86,176 33,600 - - 17,929 7,976 - - 36,074 5,343 1,053 34,916 535 - 3,394 724 147,811 51,346 166,176 1,053 26,420 (12,267) (166,176) 6,447 (3) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS (CONTINUED) JUNE 30, 2020 CAD Activities Community& Business Investor Retention E & I Business CAD Relations & Expansion Administrative Development Recruitment Total Total 30,250 6,050 69,795 $ 95 $ 816,528 6,000 2,500 428 1,500 37,800 69,795 823,051 2,500 $ 95 $ 213,365 816,528 824,028 6,000 6,000 32,750 32,750 6,050 6,050 69,795 69,795 428 428 1,500 1,540 933,146 1,153,956 - - 366,644 - - 366,644 455,023 - - 112,468 - - 112,468 155,349 - - 2,458 - - 2,458 9,864 - - - - - - 119,776 - - - - - - 25,905 777 11,188 64 12,029 54,499 12,616 - - - 460 13,076 13,076 - - - - 1,794 1,794 1,794 - 378 - 59 1,796 2,233 2,233 - - 1,543 - - 1,543 1,543 - - 55,988 - - 55,988 55,988 - 30,461 45 407 11,019 41,932 76,848 - - 13,000 - - 13,000 13,000 1,145 - 3,244 - - 4,389 4,389 33,729 - - - - 33,729 33,729 9,553 - - - - 9,553 9,553 - - 1,708 - - 1,708 1,708 - - - 1,008 - 1,008 1,543 4,118 57,043 31,616 568,286 1,538 15,069 673,552 1,039,938 (19,243) 38,179 254,765 See accompanying Notes to Financial Statements. 962 (15,069) 259,594 114,018 191,318 $ 305.336 (4) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF FUNCTIONAL EXPENSES YEAR ENDED JUNE 30, 2020 Salaries Payroll Taxes and Employee Benefits Insurance Rent, Parking and Property Taxes Utilities Office Expenses Marketing Travel Meetings Conferences Professional Fees Collaborative Expenses Staff Expenses Education Sponsorships Investor Relations Board and Committee Expenses Event Expenses Miscellaneous Total Expenses by Function Program Management Fundraising and Services and General Development Total $ 88,379 $ 366,644 $ - $ 455,023 42,881 112,468 - 155,349 7,406 2,458 - 9,864 119,776 - - 119,776 25,905 - - 25,905 42,534 11,188 777 54,499 - - 13,076 13,076 - - 1,794 1,794 59 - 2,174 2,233 - 1,543 - 1,543 - 55,988 - 55,988 35,323 45 41,480 76,848 - 13,000 - 13,000 - 3,244 1,145 4,389 - - 33,729 33,729 - - 9,553 9,553 - 1,708 - 1,708 1,543 - - 1,543 4,118 - 4,118 $ 367.924 $ 568.286 $ 103.728 $ 1.039.938 See accompanying Notes to Financial Statements. (5) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2020 NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Iowa City Area Development Group (the Organization) is an organization that promotes, develops, and advances the business community in Iowa City and the surrounding area. In addition, the Organization connects business and industry with federal, state and local resources to enhance and stimulate area economic growth through business retention, expansion and attraction efforts, and advances, develops, and advocates for the Iowa City and surrounding area workforce. Method of Accountina The accompanying financial statements have been prepared on the cash basis of accounting. Under this basis, the only asset recognized is cash, no liabilities are recognized. All transactions are recognized as either cash receipts or disbursements, and noncash transactions are not recognized. The cash basis differs from generally accepted accounting principles primarily because the effects of outstanding promises to give and obligations for expenses unpaid at the date of the financial statements are not included in the financial statements. In -Kinds The Organization receives various services and products without charge from various contributors. In -kind contributions may include professional fees, marketing fees, information technology consulting, office expenses, and advertising costs, but are not recorded in the financial statements prepared on the cash basis of accounting. For the year ended June 30, 2020, $77,215 was received as gifts in -kind. Income Taxes The Organization is exempt from taxes under section 501(c)(6) of the Internal Revenue Code and a similar section of Iowa income tax law. The Internal Revenue Service determination is that the Organization is other than a private foundation. The Organization files informational returns in the U.S. federal jurisdiction. The Organization follows the accounting standard to evaluate uncertain tax positions and has determined that it was not required to record a liability related to uncertain tax positions at June 30, 2020. Functional Allocation of Exoenses The financial statements report certain categories of expenses that are attributed to more than one program or supporting function. Therefore, expenses require allocation on a reasonable basis that is consistently applied. Expenses that can be identified with a program and supporting activity are allocated directly according to their natural expenditure classification. (6) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2020 NOTE 2 LIQUIDITY AND AVAILABILITY Financial assets available for general expenditure, that is, without donor or other restrictions limiting their use, within one year of the statement of financial position date, comprise of cash in the amount of $305,336 as of June 30, 2020. NOTE3 LEASES The Organization leases office space in Iowa City, Iowa under the terms of a lease agreement effective March 1, 2016 and through February 29, 2020. Monthly rental under the lease is $2,000 per month beginning March 1, 2016 and through February 28, 2018, and $2,500 per month from March 1, 2018 through February 29, 2020. The lease agreement was extended with an updated term of March 1, 2020 through February 29, 2024. Monthly rental under the lease extension is $2,000 per month. The Organization leases office space in Coralville, Iowa under the terms of a lease agreement effective January 1, 2019 through December 31, 2020. The lease was extended with an updated term of January 1, 2020 through July 31, 2023. Monthly rental under the lease is $2,800 per month. Future minimum lease payments are as follows: Year Endina June 30. Amount 2021 $ 57,600 2022 57,600 2023 43,600 2024 16,000 Total Minimum Lease Payments $ 174.800 Rent expense for the year ended June 30, 2020 totaled $55,600. NOTE 4 CONCENTRATION RISK The primary contributions to the Organization are the cities of Iowa City, Coralville and North Liberty, Johnson County and businesses in Johnson County, Iowa and the surrounding area. Major changes to the local area economy could materially affect the Organization's revenues and operations. The cities of Iowa City, Coralville and North Liberty and Johnson County are major contributors to the Organization. Contributions by these four governmental agencies represented 62% of total contributions to the Organization during the year ended June 30, 2020. (7) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2020 NOTE 5 RETIREMENT PLAN The Organization has a 401(k) plan covering all full-time exempt and nonexempt employees with at least 90 days of service. The Organization contributes $2 for every $1 the employee contributes up to the first 5% of the employee's base salary. The Organization's contribution expense to the plan for the year ended June 30, 2020 was $45,166. NOTE 6 RISKS AND UNCERTAINTIES In early March 2020, the COVID-19 virus was declared a global pandemic. In order to contain the spread of the virus, a government mandate suspended most of the Organization's business operations. The Organization cannot predict the length or severity of this pandemic, or the extent to which the disruption may interrupt operations. Management is closely monitoring the situation and has taken action to mitigate known vulnerabilities. No adjustments have been made to these financial statements as a result of this uncertainty. NOTE 7 JOINT VENTURE The Organization formed a joint venture with the Cedar Rapids Metro Economic Alliance effective January 1, 2016. The corporation is a nonprofit mutual benefit corporation established with the intent to leverage joint resources to implement a regional marketing strategy for business and talent attraction in a seven county region now referred to as ICR Iowa. This joint venture was amended on June 12, 2020. As a result of this amendment, all financial commitments owed from the Alliance and the Employee Lease Agreement was terminated as of April 22, 2020. Prior to the amendment, the joint agreement called for an annual funding commitment from the Organization of $30,000 each year for operations. NOTE 8 SUBSEQUENT EVENTS Management has evaluated events through September 2, 2021, the date which the financial statements were available to be issued. (8) Investment advisory services are offered through CliftonLarsonAlten Wealth Advisors, LLC, an SEC -registered investment A member of advisor. CIA is an independent member of Nexia International, a leading, global network of independent accounting and Nexia consulting firms. See nexia.com/member-firm-disclaimer for details. CliftonLarsonAllen LLP 0 International IOWA CITY AREA DEVELOPMENT GROUP FINANCIAL STATEMENTS YEAR ENC IOWA CITY AREA DEVELOPMENT GROUP TABLE OF CONTENTS YEAR ENDED JUNE 30, 2021 INDEPENDENT AUDITOR'S REPORT FINANCIAL STATEMENTS STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS STATEMENT OF FUNCTIONAL EXPENSES NOTES TO FINANCIAL STATEMENTS Clifton nnect.com LLP OFF CLAconnect.com INDEPENDENT AUDITOR'S REPORT Board of Directors Iowa City Area Development Group Iowa City, Iowa We have audited the accompanying financial statements of Iowa City Area Development Group (a nonprofit organization), which comprise the statement of cash receipts and disbursements and the related statement of functional expenses for the year ended June 30, 2021, and the related notes to the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the cash basis of accounting described in Note 1; this includes determining that the cash basis of accounting is an acceptable basis for the preparation of the financial statements in the circumstances. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. ^tea W �CLA is an independent member of Nexia International, a leading, global network of independent Nexia accounting and consulting firms. Seenexia.com/member-firm-disclaimer for details. (1) Board of Directors Iowa City Area Development Group Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the statement of cash receipts and disbursements and the related statement of functional expenses for the year ended June 30, 2021 in accordance with the cash basis of accounting described in Note 1. Basis of Accounting We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared on the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to that matter. CliftonLarsonAllen LLP Cedar Rapids, Iowa February 1, 2022 (2) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS JUNE 30, 2021 Co -Working Seed Fund Merge at 808 ICR Management RECEIPTS Merge/808 Rent $ 165,024 $ 54,230 $ - $ - Contributions - - - - Grants - - - - Sponsorships - - - - Events - - - - Strategic Doing - - - - Project Better Together - - - - Interest Miscellaneous Total Receipts 165,024 54,230 - - DISBURSEMENTS Salaries - - - - Payroll Taxes and Employee Benefits - - - - Insurance 3,893 3,893 - - Rent, Parking and Property Taxes 85,746 33,600 - - Utilities 17,743 9,478 - - Office Expenses 22,937 5,527 - Marketing - - - - Travel - - - - Meetings - - - - Conferences - - - - Professional Fees - - - - Collaborative Expenses - - - 15,337 Staff Expenses - - - - Education - - - - Sponsorships - - - - Investor Relations - - - - Board and Committee Expenses - - - - Miscellaneous 3,147 1,166 Total Disbursements 133,466 53,664 15,337 RECEIPTS OVER (UNDER) DISBURSEMENTS $ 31.558 $ 566 $ $ (15.337) See accompanying Notes to Financial Statements. (3) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS (CONTINUED) JUNE 30, 2021 ICAD Activities Community& Business Investor Retention E & I Business ICAD Relations & Expansion Administrative Development Recruitment Total Total $ - $ - $ - $ - $ - $ - $ 219,254 - - 810,650 - - 810,650 810,650 - - 121,500 - 63,000 184,500 184,500 3,601 2,000 - 2,500 - 8,101 8,101 - - - - 100 100 100 - 14,150 - - - 14,150 14,150 84,750 - - - - 84,750 84,750 476 476 476 2,500 2,500 2,500 88,351 16,150 935,126 2,500 63,100 1,105,227 1,324,481 - - 397,605 - - 397,605 397,605 - - 135,191 - - 135,191 135,191 - - 2,723 - - 2,723 10,509 - - - - - - 119,346 - - - - - - 27,221 12,459 12,459 40,923 12,797 - - - - 12,797 12,797 254 - - - 60 314 314 63 - 46 - 635 744 744 - - 1,161 - - 1,161 1,161 - - 20,385 - - 20,385 20,385 86,089 11,271 - - 1,812 99,172 114,509 - - 5,373 - - 5,373 5,373 - - 2,980 - - 2,980 2,980 2,342 - - - - 2,342 2,342 5,599 - - - - 5,599 5,599 - - 1,256 - - 1,256 1,256 32 102 134 4,447 107,144 11,303 579,281 2,507 700,235 902,702 $ (18,793) -$-4 847 $ 355. 445 $ 2.500 $ 60.5 33 $ 404,992 421,779 Cash Balance - Beginning of Year 305,336 CASH BALANCE - END OF YEAR $ 727.1 55 See accompanying Notes to Financial Statements. (4) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF FUNCTIONAL EXPENSES YEAR ENDED JUNE 30, 2021 Salaries Payroll Taxes and Employee Benefits Insurance Rent, Parking and Property Taxes Utilities Office Expenses Marketing Travel Meetings Conferences Professional Fees Collaborative Expenses Staff Expenses Education Sponsorships Investor Relations Board and Committee Expenses Miscellaneous Total Expenses by Function Program Management Fundraising and Services and General Development Total $ 99,401 $ 298,204 $ - $ 397,605 51,373 83,818 - 135,191 7,786 2,723 - 10,509 119,346 - - 119,346 27,221 - - 27,221 28,464 12,459 - 40,923 - - 12,797 12,797 - 314 314 46 698 744 - 1,161 - 1,161 - 20,385 - 20,385 26,608 - 87,901 114,509 - 5,373 - 5,373 - 2,980 - 2,980 - - 2,342 2,342 - - 5,599 5,599 - 1,256 - 1,256 4,346 101 - 4,447 $ 364.545 $ 428,506 $ 109,651 $ 902.702 See accompanying Notes to Financial Statements. (5) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2021 NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Iowa City Area Development Group (the Organization) is an organization that promotes, develops, and advances the business community in Iowa City and the surrounding area. In addition, the Organization connects business and industry with federal, state and local resources to enhance and stimulate area economic growth through business retention, expansion and attraction efforts, and advances, develops, and advocates for the Iowa City and surrounding area workforce. Method of Accountinq The accompanying financial statements have been prepared on the cash basis of accounting. Under this basis, the only asset recognized is cash, no liabilities are recognized. All transactions are recognized as either cash receipts or disbursements, and noncash transactions are not recognized. The cash basis differs from generally accepted accounting principles primarily because the effects of outstanding promises to give and obligations for expenses unpaid at the date of the financial statements are not included in the financial statements. In -Kinds The Organization receives various services and products without charge from various contributors. In -kind contributions may include professional fees, marketing fees, information technology consulting, office expenses, and advertising costs, but are not recorded in the financial statements prepared on the cash basis of accounting. For the year ended June 30, 2021, $1,000 was received as gifts in -kind. Income Taxes The Organization is exempt from taxes under section 501(c)(6) of the Internal Revenue Code and a similar section of Iowa income tax law. The Internal Revenue Service determination is that the Organization is other than a private foundation. The Organization files informational returns in the U.S. federal jurisdiction. The Organization follows the accounting standard to evaluate uncertain tax positions and has determined that it was not required to record a liability related to uncertain tax positions at June 30, 2021. Functional Allocation of Exoenses The financial statements report certain categories of expenses that are attributed to more than one program or supporting function. Therefore, expenses require allocation on a reasonable basis that is consistently applied. Expenses that can be identified with a program and supporting activity are allocated directly according to their natural expenditure classification. NOTE 2 LIQUIDITY AND AVAILABILITY Financial assets available for general expenditure, that is, without donor or other restrictions limiting their use, within one year of the statement of financial position date, comprise of cash in the amount of $727,115 as of June 30, 2021. (6) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2021 NOTE 3 LEASES The Organization leases office space in Iowa City, Iowa, under the terms of a lease agreement effective March 1, 2020, and through February 29, 2024. Monthly rental under the lease is $2,000 per month The Organization leases office space in Coralville, Iowa under the terms of a lease agreement effective January 1, 2019 through December 31, 2020. The lease was extended with an updated term of January 1, 2020 through July 31, 2023. Monthly rental under the lease is $2,800 per month. Future minimum lease payments are as follows: Year Endina June 30. Amount 2022 $ 57,600 2023 57,600 2024 18,800 Total Minimum Lease Payments $ 134.000 Rent expense for the year ended June 30, 2021 totaled $57,600. NOTE 4 CONCENTRATION RISK The primary contributions to the Organization are the cities of Iowa City, Coralville and North Liberty, Johnson County and businesses in Johnson County, Iowa and the surrounding area. Major changes to the local area economy could materially affect the Organization's revenues and operations. The cities of Iowa City, Coralville, and North Liberty and Johnson County are major contributors to the Organization. Contributions by these four governmental agencies represented 36% of total contributions to the Organization during the year ended June 30, 2021. NOTE 5 PAYCHECK PROTECTION PROGRAM On February 18, 2021, the Organization applied for and obtained a $121,500 Paycheck Protection Program (PPP Loan), administered by the U.S. Small Business Administration, established under the Coronavirus Aid, Relief, and Economic Security Act (Cares Act). The SBA may review funding eligibility and usage of funds for compliance with program requirements based on dollar thresholds and other factors. The amount of liability, if any, from potential noncompliance cannot be determined with certainty, however, management is of the opinion that any review will not have a material adverse impact on the Organization's financial position. On August 24, 2021, the PPP loan was fully forgiven for the entire amount. The amount is recorded under grant receipts in the statement of cash receipts and disbursements. (7) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2021 NOTE 6 RETIREMENT PLAN The Organization has a 401(k) plan covering all full-time exempt and nonexempt employees with at least 90 days of service. The Organization contributes $2 for every $1 the employee contributes up to the first 5% of the employee's base salary. The Organization's contribution expense to the plan for the year ended June 30, 2021 was $37,207. NOTE 7 RISKS AND UNCERTAINTIES In early March 2020, the COVID-19 virus was declared a global pandemic. In order to contain the spread of the virus, a government mandate suspended most of the Organization's business operations. The Organization cannot predict the length or severity of this pandemic, or the extent to which the disruption may interrupt operations. Management is closely monitoring the situation and has taken action to mitigate known vulnerabilities. No adjustments have been made to these financial statements as a result of this uncertainty. NOTE 8 JOINT VENTURE The Organization formed a joint venture with the Cedar Rapids Metro Economic Alliance effective January 1, 2016. The corporation is a nonprofit mutual benefit corporation established with the intent to leverage joint resources to implement a regional marketing strategy for business and talent attraction in a seven county region now referred to as ICR Iowa. This joint venture was amended on June 12, 2020. As a result of this amendment, all financial commitments owed from the Alliance and the Employee Lease Agreement was terminated as of April 22, 2020. Prior to the amendment, the joint agreement called for an annual funding commitment from the Organization of $30,000 each year for operations. Effective April 5, 2021 the joint venture was amended to narrow the scope of the joint venture to implementing and executing an annual strategic marketing plan. The Organization is required to contribute $30,000 to the joint venture every year for operations. NOTE 9 SUBSEQUENT EVENTS Management has evaluated events through February 1, 2022, the date which the financial statements were available to be issued. (8) Investment advisory services are offered through CliftonLarsonAlten Wealth Advisors, LLC, an SEC -registered investment A member of advisor. CIA is an independent member of Nexia International, a leading, global network of independent accounting and Nexia consulting firms. See nexia.com/member-firm-disclaimer for details. CliftonLarsonAllen LLP 0 International IOWA CITY AREA DEVELOPMENT GROUP FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 2022 �T. CPAs I CONSULTANTS I WEALTH ADVISORS CLAconnect.com IOWA CITY AREA DEVELOPMENT GROUP TABLE OF CONTENTS YEAR ENDED JUNE 30, 2022 INDEPENDENT ACCOUNTANTS' REVIEW REPORT FINANCIAL STATEMENTS STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS STATEMENT OF FUNCTIONAL EXPENSES NOTES TO FINANCIAL STATEMENTS CliftonLarsonAllen LLP . CLAconnect.com INDEPENDENT ACCOUNTANTS' REVIEW REPORT Board of Directors Iowa City Area Development Group Iowa City, Iowa We have reviewed the accompanying financial statements of Iowa City Area Development Group (a nonprofit organization), which comprise the statement of cash receipts and disbursements and the related statement of functional expenses for the year ended June 30, 2022, and the related notes to the financial statements. A review includes primarily applying analytical procedures to management's financial data and making inquiries of entity management. A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, we do not express such an opinion. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the cash basis of accounting described in Note 1; this includes determining that the cash basis of accounting is an acceptable basis for the preparation of financial statements in the circumstances. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Accountants' Responsibility Our responsibility is to conduct the review engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the American Institute of Certified Public Accountants. Those standards require us to perform procedures to obtain limited assurance as a basis for reporting whether we are aware of any material modifications that should be made to the financial statements for them to be in accordance with the cash basis of accounting. We believe that the results of our procedures provide a reasonable basis for our conclusion. We are required to be independent of Iowa City Area Development Group and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our review. Accountants' Conclusion Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in accordance with the cash basis of accounting. CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLA¢lobal.com/disclaimer. (1) Board of Directors Iowa City Area Development Group Basis of Accounting We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared in accordance with the cash basis of accounting, which is a basis of accounting other than accounting principles generally accepted in the United States of America. Our conclusion is not modified with respect to this matter. CliftonLarsonAllen LLP Cedar Rapids, Iowa November 11, 2022 (2) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS JUNE 30, 2022 RECEIPTS Merge/808 Rent Contributions Grants Sponsorships Events Annual Meeting Strategic Doing Interest Miscellaneous Total Receipts DISBURSEMENTS Salaries Payroll Taxes and Employee Benefits Insurance Rent, Parking and Property Taxes Utilities Office Expenses Marketing Travel Meetings Professional Fees Collaborative Expenses Staff Expenses Sponsorships Investor Relations Board and Committee Expenses Event Expenses Miscellaneous Total Disbursements RECEIPTS OVER (UNDER) DISBU Cash Balance - Beginning of Year CASH BALANCE - END OF YEAR See accompanying Notes to Financial Statements. Co -Working EdTech Merge at 808 Collaborative ICR $ 181,149 $ 45,425 $ 110,794 4,850 340 181,149 45,425 115,984 79,129 15,333 3,509 3,509 - 84,522 33,600 - 23,695 10,044 - 32,330 5,753 3,655 - - 3,394 14,803 40,400 3,443 884 40,703 147,499 53,790 157,067 40,400 33,651 (8,365) (41,083) (40,400) (3) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS (CONTINUED) JUNE 30, 2022 Community& Investor Relations Business Retention & Expansion ICAD Activities E & I Business Administrative Development Recruitment ICAD Total Total $ - $ - $ - $ - $ - $ - $ 226,574 - - 836,364 - - 836,364 836,364 - - - - - - 110,794 84,500 - - 20,000 - 104,500 109,350 _ _ _ 340 9,590 - - - - 9,590 9,590 - 40,926 - - - 40,926 40,926 - - 421 - - 421 421 12,500 11,254 23,754 23,754 106,590 40,926 848,039 20,000 - 1,015,555 1,358,113 - - 467,399 - - 467,399 546,528 - - 151,901 - - 151,901 167,234 - - 2,103 - - 2,103 9,120 - - - - - - 118,122 - - - - - - 33,739 - 667 11,115 - 12,052 23,834 65,572 6,329 - 912 - - 7,241 10,635 - 60 - 5,550 - 5,610 20,413 57 146 - - 8,024 8,227 8,227 - - 24,715 - - 24,715 24,715 70,943 41,114 - - 112,057 152,457 - - 15,497 - - 15,497 15,497 19,626 25,000 - 40,957 - 85,583 85,583 17,758 - - - - 17,758 17,808 - - 1,493 - - 1,493 1,493 - - - 1,524 - 1,524 1,524 24 24 45,054 114,713 66,987 675,159 48,031 20,076 924,966 1,323,721 (8,123) (26,061) 172,880 (28,031) (20,076) 90,589 34,392 727,115 $ 761,5 77 See accompanying Notes to Financial Statements. (4) IOWA CITY AREA DEVELOPMENT GROUP STATEMENT OF FUNCTIONAL EXPENSES YEAR ENDED JUNE 30, 2022 Salaries Payroll Taxes and Employee Benefits Insurance Rent, Parking and Property Taxes Utilities Office Expenses Marketing Travel Meetings Professional Fees Collaborative Expenses Staff Expenses Sponsorships Investor Relations Board and Committee Expenses Event Expenses Miscellaneous Total Expenses by Function Program Management Fundraising and Services and General Development Total $ 79,129 $ 467,399 $ - $ 546,528 15,333 151,901 - 167,234 7,017 2,103 - 9,120 118,122 - - 118,122 33,739 - - 33,739 41,738 11,115 12,719 65,572 3,394 912 6,329 10,635 20,353 - 60 20,413 - - 8,227 8,227 - 24,715 - 24,715 40,400 - 112,057 152,457 - 15,497 - 15,497 40,957 - 44,626 85,583 50 - 17,758 17,808 - 1,493 - 1,493 1,524 - - 1,524 45,030 24 - 45,054 $ 446.786 $ 675,159 $ 201,776 $ 1.323.721 See accompanying Notes to Financial Statements. (5) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2022 NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Iowa City Area Development Group (the Organization) is an organization that promotes, develops, and advances the business community in Iowa City and the surrounding area. In addition, the Organization connects business and industry with federal, state, and local resources to enhance and stimulate area economic growth through business retention, expansion and attraction efforts, and advances, develops, and advocates for the Iowa City and surrounding area workforce. Method of Accountinq The accompanying financial statements have been prepared on the cash basis of accounting. Under this basis, the only asset recognized is cash, no liabilities are recognized. All transactions are recognized as either cash receipts or disbursements, and noncash transactions are not recognized. The cash basis differs from generally accepted accounting principles primarily because the effects of outstanding promises to give and obligations for expenses unpaid at the date of the financial statements are not included in the financial statements. In -Kinds The Organization receives various services and products without charge from various contributors. In -kind contributions may include professional fees, marketing fees, information technology consulting, office expenses, and advertising costs, but are not recorded in the financial statements prepared on the cash basis of accounting. For the year ended June 30, 2022, $23,417 was received as gifts in -kind. Income Taxes The Organization is exempt from taxes under section 501(c)(6) of the Internal Revenue Code and a similar section of Iowa income tax law. The Internal Revenue Service determination is that the Organization is other than a private foundation. The Organization files informational returns in the U.S. federal jurisdiction. The Organization follows the accounting standard to evaluate uncertain tax positions and has determined that it was not required to record a liability related to uncertain tax positions at June 30, 2022. Functional Allocation of Exoenses The financial statements report certain categories of expenses that are attributed to more than one program or supporting function. Therefore, expenses require allocation on a reasonable basis that is consistently applied. Expenses that can be identified with a program and supporting activity are allocated directly according to their natural expenditure classification. (6) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2022 NOTE 2 LIQUIDITY AND AVAILABILITY Financial assets available for general expenditure, that is, without donor or other restrictions limiting their use, within one year of the statement of financial position date, comprise of cash in the amount of $761,507 as of June 30, 2022. NOTE3 LEASES The Organization leases office space in Iowa City, Iowa, under the terms of a lease agreement effective March 1, 2016, and through February 29, 2020. Monthly rental under the lease is $2,000 per month beginning March 1, 2016, and through February 28, 2018, and $2,500 per month from March 1, 2018 through February 29, 2020. The lease agreement was extended with an updated term of March 1, 2020 through February 29, 2024. Monthly rental under the lease extension is $2,000 per month. The Organization leases office space in Coralville, Iowa, under the terms of a lease agreement effective January 1, 2019 through December 31, 2020. The lease was extended with an updated term of January 1, 2020 through July 31, 2023. Monthly rental under the lease is $2,800 per month. Future minimum lease payments are as follows: Year Ending June 30. Amount 2023 $ 57,600 2024 18,800 Total Minimum Lease Payments $ 76,400 Rent expense for the year ended June 30, 2022 totaled $57,600. NOTE 4 CONCENTRATION RISK The primary contributions to the Organization are the cities of Iowa City, Coralville, and North Liberty, Johnson County and businesses in Johnson County, Iowa, and the surrounding area. Major changes to the local area economy could materially affect the Organization's revenues and operations. The cities of Iowa City, Coralville, and North Liberty and Johnson County are major contributors to the Organization. Contributions by these four governmental agencies represented 35% of total contributions to the Organization during the year ended June 30, 2022. (7) IOWA CITY AREA DEVELOPMENT GROUP NOTES TO FINANCIAL STATEMENTS JUNE 30, 2022 NOTE 5 RETIREMENT PLAN The Organization has a 401(k) plan covering all full-time exempt and nonexempt employees with at least 90 days of service. The Organization contributes $2 for every $1 the employee contributes up to the first 5% of the employee's base salary. The Organization's contribution expense to the plan for the year ended June 30, 2022 was $45,908. NOTE 6 JOINT VENTURE The Organization formed a joint venture with the Cedar Rapids Metro Economic Alliance effective January 1, 2016. The corporation is a nonprofit mutual benefit corporation established with the intent to leverage joint resources to implement a regional marketing strategy for business and talent attraction in a seven county region now referred to as ICR Iowa. This joint venture was amended on June 12, 2020. As a result of this amendment, all financial commitments owed from the Alliance and the Employee Lease Agreement was terminated as of April 22, 2020. Effective April 5, 2021, the joint venture was amended to narrow the scope of the joint venture to implementing and executing an annual strategic marketing plan. The Organization is required to contribute $30,000 to the joint venture every year for operations. NOTE 7 SUBSEQUENT EVENTS Management has evaluated events through November 11, 2022, the date which the financial statements were available to be issued. (8) 0 Global INDEPENDENT NETWORK MEMBER CLA (Clifton LarsonAtlen LLP) is a network member of CLA Gtobal. See CLAglobal.com/disclaimer. Investment advisory services are offered through CiftonLarsonAllen Wealth Advisors, LLC, an SEC -registered investment advisor.