HomeMy WebLinkAbout2014-02-06 Info PacketCITY COUNCIL INFORMATION PACKET
CITY OF IOWA CITY
www.icgov.org February 6, 2014
IP1 Council Tentative Meeting Schedule
MISCELLANEOUS
IP2 Memo from Community Development Planner: FFY12 Consolidates Annual Performance
and Evaluation Report (CAPER)
IP3 Memo from Assistant Transportation Planner to MPOJC Executive Director: ICCSD 10 -Year
School Renovation / Construction Timeline
IN Letter from City Manager to Johnson County Board of Supervisors: Animal Services invoice
for final quarter fiscal year 2012 -2013
IPS Memo from City Clerk: KXIC Radio Show
IP6 Civil Service Preferred Hiring List — Housing Assistant
IP7 Civil Service Preferred Hiring List — Housing Program Assistant
IP8 Civil Service Preferred Hiring List — Systems Project Manager
IP9 Letter from Iowa Department of Transportation (IDOT): PCC Patching — US 6
IP10 Press Release: Comprehensive Annual Financial Report
DRAFT MINUTES
IP11 Citizens Police Review Board: January 28
IP12 Planning and Zoning Commission: January 16 (formal)
City Council Tentative Meeting Schedule IP1
Subject to change
CITY OF IOWA CITY
February 6, 2014
Date
Time
Meeting
Location
Thursday, February 6, 2014
5:00 PM
City Conference Board
Emma J. Harvat Hall
Special Formal Meeting
Tuesday, February 18, 2014 5:00 PM Work Session Meeting Emma J. Harvat Hall
7:00 PM Formal Meeting
Tuesday, March 4, 2014 5:00 PM City Conference Board Emma J. Harvat Hall
Work Session Meeting
Tuesday, May 6, 2014 5:00 PM Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, March 25, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Special Formal Meeting
Tuesday, April 1, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, April 15, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Monday, April 28, 2014
4:30 PM
Joint Meeting /Work Session
TBA / ICCSD
Tuesday, May 6, 2014 5:00 PM Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, May 20, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, June 3, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, June 17, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, July 1, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, July 15, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, August 5, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, August 19, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, September 2, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, September 16, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, October 7, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, October 21, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, November 4, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, November 18, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, December 2, 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
Tuesday, December 16 2014
5:00 PM
Work Session Meeting
Emma J. Harvat Hall
7:00 PM
Formal Meeting
I
®4„ CITY OF IOWA CITY IP2 Ot
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MORANDUM
Date: February 5, 2014
To: Tom Markus, City Manager
From: Tracy Hightshoe, Community Development Planner
Re: FFY12 Consolidated Annual Performance and Evaluation Report (CAPER)
We recently received our annual CAPER evaluation letter from HUD. As a recipient of
Community Development Block Grant (CDBG) and HOME Investment Partnerships Program
(HOME) funds, the City must submit an annual report to the U.S. Department of Housing and
Urban Development (HUD) following each fiscal year. The FFY12 report covers July 1, 2012
through June 30, 2013 (City FY13). This report describes how the City utilized its CDBG and
HOME funds and includes project accomplishments. The report can be found online at
www.icgov.org /actionplan. HUD reviews the submitted CAPER and must determine if the City is
in compliance with the program's federal requirements and if the City has the continued capacity
to implement and administer the programs for which assistance is received. Their letter is
attached for your review.
FY13 was a successful year. Several public facility and housing projects were completed during
the year. CDBG funds provided 1,457 persons with various public services, assisted six public
facilities with needed improvements, assisted 86 owner - occupied or rental households and
created 20.5 FTEs through three new businesses. HOME funds assisted 40 households with
affordable housing needs.
Unique to previous years, the City was required to complete a HUD - approved workout plan as
the City exceeded the timeliness measure HUD uses to evaluate if recipients are administering
program funds in a timely, efficient manner. HUD limits the amount of CDBG funds the City can
hold in its line of credit to 1.5 times their annual entitlement. The FY12 (FFY11) CDBG
entitlement was $603,931. The City received $2.7 million in program income when the State
allowed the City to retain, as CDBG program income, a construction loan repayment from the
Iowa CDBG Disaster Recovery Fund. This amount represented 4.4 times the City's annual
entitlement. The City held a special mid -year funding round to allocate funds to projects that
could spend the funds on a timely basis and that met one or more CITY STEPS priorities. The
City had a balance of 1.28 funds unexpended by the end of FY13. The City is now in
compliance and no longer required to submit a workout plan.
Please feel free to contact me at trace- hightshoeCaD-iowa- city.orq or at 356 -5244 if you have any
questions.
P.,MEIffN��II T p,
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Mr. Thomas M. Markus
City Manager
City of Iowa City
410 East Washington
Iowa City, IA 52240
Dear Mr. Markus:
U.S. Department of Housing and Urban Development
Omaha Field Office
Edward Zorinsky Building
1616 Capitol Avenue, Suite 329
Omaha, Nebraska 68102 -4908
January 21, 2014
Subject: Consolidated Annual Performance Evaluation Report — Program Year 2012
HUD's Office of Community Planning and Development has sought to establish partnerships
with state and local governments. The focus of our partnership has been to work with communities to
ensure that our joint efforts result in housing and community development programs and policies that
benefit and serve low -and moderate - income persons. These efforts occur within the framework of the
statutes that we administer and the regulations and emerging policies that are designed to improve
program performance.
The provisions of the Housing and Community Development Act of 1974, as amended, and the
National Affordable Housing Act of 1990, require the annual submission of performance reports by grant
recipients receiving federal assistance through programs covered under these Acts. Additionally, these
Acts require that a determination be made by the Secretary, that the grant recipient is in compliance with
the statutes and has the continuing capacity to implement and administer the programs for which
assistance is received.
Traditionally, these determinations were made through the review of annual reports submitted by
grantees for each individual program receiving assistance. With the implementation of the Consolidated
Planning Regulations of January 5, 1995, the Department is required to conduct a comprehensive
performance review of your overall progress at least annually (24 CFR 91.525). The review consists of
analyzing your consolidated planning process; reviewing management of funds; determining the
compliance of funded activities with statutory and regulatory requirements; determining the compliance
of funded activities with statutory and regulatory requirements; determining the accuracy of required
performance reports; as well as evaluating your accomplishments in meeting key Departmental
objectives.
We congratulate you on your many accomplishments during program year 2012 on achieving
Departmental objectives. Some examples of the City's accomplishments are as follows:
In FY 2012, Iowa City expended $1,778,290 in CDBG funds. CDBG funded activities that
provided 1,457 individuals with various public services, assisted 6 public facilities with needed
improvements, assisted 86 owner - occupied or rental households, and provided financial assistance for
three small businesses. CDBG- funded activities leveraged $2,847,719 in other public and private funds.
In FY12, the city expended $746,224 in HOME funds which assisted 40 households with
affordable housing needs. Habitat for Humanity was allocated funds to acquire three existing homes for
rehabilitation to be sold to income - eligible homebuyers. The city also uses HOME funds to assist low -
income homeowners. Six comprehensive owner- occupied housing rehabilitation HOME projects were
completed in FY12. HOME - assisted activities leveraged $2,486,405 in other public and private funds.
Three businesses that were approved for prior year CDBG Economic Development funding,
opened their businesses last year and met their hiring goals. The Trumpet Blossom Cafe, Molly's
Cupcakes, and IBlitz Boxing and Fitness Club created a total of 20.5 FTEs.
Last year, Shelter House in Iowa City, completed their new, facility which is a 16,500 square feet,
two -story building, 70 -bed shelter for homeless persons. The project, funded with federal, state, city and
local resources, partners with other relevant agencies and will provide numerous services to participating
individuals.
The city worked diligently to meet CDBG timeliness requirements. The city failed to meet its
2011 CDBG timeliness deadline because of a $2.7 million repayment of funds. The city completed a
HUD - approved workout plan to successfully correct the deficiency. The city had a balance of 1.28
funds unexpended 60 days prior to the end of its 2012 program year, which meets the statutory standard
for timeliness at 24 CFR 570.902.
The city certified that it would provide overall benefit to LMI persons for program-year 2012 of
at least 70 percent. The actual principal benefit for the year was 100 percent, which is in compliance with
the regulatory standard. The city utilized 6.29% of its CDBG funds for public service activities and
16.46% for planning and administration.
If you have any questions or require assistance, please contact Ms. Shari Garner, Community
Planning and Development Representative, at 402.492.3146, or via emW at shari.a.garner @hud.gov.
Attachment
cc: Jeff Davidson
Steve Long
Severin
Director,
Community Planning and
Development Division
Date:
To:
From:
Re:
February 6, 2014
John Yapp; Executive Director
Kent Ralston; Assistant Transportation Planner
ICCSD 10 -Year School Renovation/Construction Timeline
The following bullets highlight m*r milestones and construction efforts included in the Iowa
City Community School Districts (ICCSD) 10 -year school renovation/construction timeline
(attached). The timeline was approved at the ICCSD 12/10/13 Board meeting and includes a
schedule for constructinovation projects and identifies the transitional facilities to be used
during the process. A document detailing the types of construction/renovation and cost for each
facility is also attached.
Summer 2015
-Twain & Penn renovations completed
Fall 2015
-Hills renovation completed
-South Elementary School Opens
Summer 2016
-City High phase 1 renovations completed
Fall 2016
- Coralville Central renovation completed
Summer 2017
-Lucas renovation completed
-East Elementary Schaal Opens
-North High School phase 1 completed — school opens
Summer 2018
- Longfellow renovations completed
Summer 2019
-Mann & Lincoln renovations completed
- Southeast Junior High renovation completed
Fall 2019
-North Elementary School Opens
- Hoover Closed
-North High School phase 2 completed
Winter 2019
-West High School renovation completed
Summer 2020
- Shimek renovation completed
Summer 2021
- Northwest & North Central renovations completed
Fall 2021
-City High phase 2 renovation completed
Summer 2022
- North High School phase 3 completed
Fall 2022
-Horn renovation complete
Summer 2023
-Lemme & Roosevelt renovations completed
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Dear Members of the Johnson County Board of Supervisors,
It has recently been brought to my attention that invoices for animal services provided to
Johnson County have not been consistently billed, despite our previous discussions. I was
made aware of the situation by our newest Councilmember Kingsley Botchway; after
researching the issue we found that his information was correct. While I thought this matter had
been resolved, it clearly has not been, as services for the final quarter of fiscal year 2012 -2013
were never billed.
I would like to reaffirm that I find this issue to be of the utmost importance. We are addressing
the issue with the staff previously responsible for overseeing this billing and have instituted
measures to ensure that it does not happen again. As of July 1, 2013, invoice generation has
moved to our finance department and animal center billing has been incorporated into the
monthly invoice process. All monthly invoices have been delivered on schedule since this
system was instituted last July. Given that the new animal service contract is not dependent on
reviewing quarterly animal intake data and invoices are system generated on the same day
each month, there should be no future billing delays.
We understand that the delay in receiving this invoice may cause some issues with crossing
fiscal years, if expenses are accrued to the period of service delivery. Please contact me if you
have any questions in this regard.
I apologize for the delay in delivering the final fiscal year 2012 -2013 invoice. Thank you.
e s,
Tom Markus
City Manager
«. SRO /Q
February 5, 2014''
CITY OF IOWA CITY
410 East Washington Street
Johnson County Board of Supervisors
Iowa city, Iowa 52240-1826
913 South Dubuque Street
(3 19) 356 -5000
Suite 201
(319) 356 -5009 FAX
Iowa City, Iowa 52240
www.lcgov.org
Dear Members of the Johnson County Board of Supervisors,
It has recently been brought to my attention that invoices for animal services provided to
Johnson County have not been consistently billed, despite our previous discussions. I was
made aware of the situation by our newest Councilmember Kingsley Botchway; after
researching the issue we found that his information was correct. While I thought this matter had
been resolved, it clearly has not been, as services for the final quarter of fiscal year 2012 -2013
were never billed.
I would like to reaffirm that I find this issue to be of the utmost importance. We are addressing
the issue with the staff previously responsible for overseeing this billing and have instituted
measures to ensure that it does not happen again. As of July 1, 2013, invoice generation has
moved to our finance department and animal center billing has been incorporated into the
monthly invoice process. All monthly invoices have been delivered on schedule since this
system was instituted last July. Given that the new animal service contract is not dependent on
reviewing quarterly animal intake data and invoices are system generated on the same day
each month, there should be no future billing delays.
We understand that the delay in receiving this invoice may cause some issues with crossing
fiscal years, if expenses are accrued to the period of service delivery. Please contact me if you
have any questions in this regard.
I apologize for the delay in delivering the final fiscal year 2012 -2013 invoice. Thank you.
e s,
Tom Markus
City Manager
r
CITY OF IOWA CITY IP5
MEMORANDUM
Date:
February 3, 2014
To:
Mayor and City Council
From:
Marian K. Karr, City Clerk
Re:
KXIC Radio Show
KXIC offers a City show at 9:00 AM every Wednesday morning. In the past Council has
volunteered for dates, and staff filled in as necessary. Please take a look at your calendars and
come prepared to help fill in the schedule at your work session on February 18:
February 12 — Botchway
February 19 — Payne
February 26 -
March 5 — Hayek
March 12 —
March 19 — Dobyns
March 26 -
Future commitments:
April 30 - Dobyns
June 18 - Dobyns
U:radioshowasking.doc
1 r 1 iPs
MEG
CITY OF IOWA CITY
410 East Washington Street
Iowa City, Iowa 52240 -1826
IOWA CITY CIVIL SERVICE COMMISSION (3 19) 356 -5000
(319) 356 -5009 FAX
www.icgov.org
January 28, 2014
RE: Civil Service Preferred Hiring list — Housing Assistant
We, the undersigned members of the Civil Service Commission of Iowa City, Iowa, do hereby
certify that in accordance with Chapter 400.28 of the Iowa Code, the following named person(s)
are being placed on an eligibility list for the position of Housing Assistant for a period of three
years.
Lucy Joseph
ATTEST:
Ma ' n K. Karr
Lyra V. Dickerson, Chair
IOWA CITY CIVIL SERVICE COMMISSION
January 28, 2014
RE: Civil Service Preferred Hiring list — Housing Program Assistant
' r IP7
�...:.®
CITY OF IOWA CITY
410 East Washington Street
Iowa City, Iowa 52240 -1826
(3 19) 356 -5000
(319) 356 -5009 FAX
www.icgov.org
We, the undersigned members of the Civil Service Commission of Iowa City, Iowa, do hereby
certify that in accordance with Chapter 400.28 of the Iowa Code, the following named person(s)
are being placed on an eligibility list for the position of Housing Program Assistant for a period of
three years.
Joan Kramer
Lyra W. Dickerson, Chair
I "On _ ". " iail
N -��
I I i
� _ IP8
�9z%P
CITY OF IOWA CITY
410 East Washington Street
Iowa City, Iowa 52240 -1826
IOWA CITY CIVIL SERVICE COMMISSION (3 19) 356 -5000
(319) 356 -5009 FAX
www.icgov.org
January 28, 2014
RE: Civil Service Preferred Hiring list — Systems Project Manager
We, the undersigned members of the Civil Service Commission of Iowa City, Iowa, do hereby
certify that in accordance with Chapter 400.28 of the Iowa Code, the following named person(s)
are being placed on an eligibility list for the position of Systems Project Manager for a period of
three years.
Steven Bird
ATTEST: r
Mari K. Karr
Lyra )AI. Dickerson, Chair
IP9
Iowa Department of Transportation
5455 Kirkwood Blvd. SW
Cedar Rapids, IA 52404 -5217
February 3, 2014
The Honorable Matt Hayek, Mayor
City of Iowa City
410 East Washington
Iowa City, IA 52240
Sl1BJECT: PCC Patching — US 6
Dear Mayor Hayek:
(319) 365 -6986
(319) 730 -1564 fax
RE: MP- 6- 6(727)250- -76-52
Johnson County
City of Iowa City
.c-
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ry
N)
This letter is official notification to your City Council that the Iowa Department of Transportation
proposes to let a PCC (Portland Cement Concrete) patching project on April 15, 2014. The work
consists of replacing broken sections of pavement. The project is located on US 6 in Iowa City
from east of Hawkins Drive southeasterly to near the south junction with Iowa 1.
It is anticipated that the project will be completed in calendar year 2014. The work will be done
in accordance with the current Form 810034, "Agreement for Primary Road Extension
Maintenance and Operation ". Project costs will be paid from the Primary Road Fund and no
charges will be made against the city.
Resident Construction Engineer, John Vu, P.E., of Cedar Rapids, Iowa, telephone number 319-
365 -6986, will advise you of the contractor's proposed schedule when the information is
available.
We would appreciate this project notification being included on your next City Council meeting
agenda as a matter of information for Council members.
If you have any questions concerning the work involved, please contact this office as soon as
possible in order to expedite any possible changes.
Sincerely yours,
Cm cyl�
Thomas M. Storey, P.E.
District Staff Engineer
TMS /rhh
cc: Jim Schnoebelen, P.E., District Engineer, Iowa DOT, Cedar Rapids, IA 52404
John Vu, P.E., Project Construction Engineer, Iowa DOT, Cedar Rapids, IA 52404
Newman Abuissa, P.E., Staff Engineer, Iowa DOT, Cedar Rapids, IA 52404
I : .
Auditor's Report Released for the
Year Ended June 30, 2013
Posted by: Finance Administration
Mailing List(s): General City News
Eide Bailly LLP, Certified Public Accountants, have released an audit report on the
financial statements of the City of Iowa City for the fiscal year that ended June 30, 2013.
The report shows City revenues for FY13 totaled $179,333,000, while expenses for the
year totaled $115,204,000.
Sources of revenue included $51,017,000 in property taxes, $55,082,000 from operating
and capital grants and contributions, and $46,753,000 in charges for services. Expenses
included $49,148,000 for business activities, $20,989,000 for public safety, $14,481,000
for culture and recreation, $10,596,000 for community and economic development, and
$10,240,000 for public works.
The City's Finance Department has also submitted its Comprehensive Annual Financial
Report to the Government Finance Officers Association of the United States and Canada
(GFOA) for consideration for an award of excellence. The Certificate of Achievement for
Excellence in Financial Reporting, the highest form of recognition for state and local
financial reporting, has been awarded to the City of Iowa City for the past 28 years.
Copies of the Comprehensive Annual Financial Report and the auditor's report are
available for review in the Iowa City Public Library at 123 S. Linn Street or in the City
Clerk's office at City Hall, 410 E. Washington Street. The documents are also posted
online at www.ic og vor /g cafr.
For more information, contact Robin Marshall, City Controller, at 319.356.5085 or e-mail
robin- marshall&iowa- city.org.
Eid�e�lly.
CPAs & BUSINESS ADVISORS
December 19, 2013
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
We have audited the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa, for the year
ended June 30, 2013. Professional standards require that we provide you with information about our
responsibilities under generally accepted auditing standards, Government Auditing Standards, and OMB
Circular A -133, as well as certain information related to the planned scope and timing of our audit. We
have communicated such information in our letter to you dated May 8, 2013. Professional standards also
require that we communicate to you the following information related to our audit.
Significant Audit Findings
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City of Iowa City are described in Note I to the financial statements. No
significant new accounting policies were adopted, and the application of existing policies was not
changed during the year ended June 30, 2013. We noted no transactions entered into by the City during
the year for which there is a lack of authoritative guidance or consensus. All significant transactions have
been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are
based on management's knowledge and experience about past and current events and assumptions about
future events. Certain accounting estimates are particularly sensitive because of their significance to the
financial statements and because of the possibility that future events affecting them may differ
significantly from those expected. The most sensitive estimates affecting the City's financial statements
were:
Management's estimate of incurred but not reported health, property, liability, and workers'
compensation insurance liabilities are based on third -party administrator's calculations and estimates.
We evaluated the key factors and assumptions used to develop incurred but not reported liabilities in
determining that they are reasonable in relation to the financial statements taken as a whole.
Management's estimate of the other postemployment benefits is based on a calculation of
actuarially determined contributions for health insurance benefits. We evaluated the key factors
and assumptions used to develop the other postemployment benefits liability in determining that
it is reasonable in relation to the financial statements taken as a whole.
www.eideboilly.com
3999 Pennsylvania Ave., Ste. 100 1 Dubuque, IA 52002 -2273 I T 563.556.1790 � F 563.557.7842 1 EOE
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
Page 2
Management's estimate of the landfill closure and postclosure care liability is based on
engineering cost studies and capacity estimates. We evaluated the key factors and assumptions
used to develop the landfill closure and postclosure care liability in determining that it is
reasonable in relation to the financial statements taken as a whole.
The financial statement disclosures are neutral, consistent, and clear.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our
audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the
audit, other than those that are clearly trivial, and communicate them to the appropriate level of
management. Management has corrected all such misstatements. The following material misstatement,
detected as a result of audit procedures, was corrected by management:
Equity Increase (Decrease)
Fund
Statements
Sanitation Fund
To adjust beginning net position for error
in calculation of closure and postclosure
care liability $ 6,467,618
Disagreements with Management
Business -Type
Activities
$ 6,467,618
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial
statements or the auditor's report. We are pleased to report that no such disagreements arose during the
course of our audit.
Management Representations
We have requested certain representations from management that are included in the management
representation letter dated December 19, 2013.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting
matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves
application of an accounting principle to the City's financial statements or a determination of the type of
auditor's opinion that may be expressed on those statements, our professional standards require the
consulting accountant to check with us to determine that the consultant has all the relevant facts. To our
knowledge, there were no such consultations with other accountants.
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
Page 3
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to retention as the City's auditors. However, these
discussions occurred in the normal course of our professional relationship, and our responses were not a
condition to our retention.
Other Matters
With respect to the supplementary information accompanying the financial statements, we made certain
inquiries of management and evaluated the form, content, and methods of preparing the information to
determine that the information complies with accounting principles generally accepted in the United
States of America, the method of preparing it has not changed from the prior period, and the information
is appropriate and complete in relation to our audit of the financial statements. We compared and
reconciled the supplementary information to the underlying accounting records used to prepare the
financial statements or to the financial statements themselves.
This information is intended solely for the use of the Mayor, City Council, and management of the City of
Iowa City, Iowa, and is not intended to be, and should not be, used by anyone other than these specified
parties.
Sincerely,
EIDE BAILLY LLP
Dubuque, Iowa
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City of Iowa City, Iowa
Comprehensive Annual Financial Aeport�_
For the Fiscal Year Ended June 30, 2013 F
On the cover
Terry Trueblood, the City of Iowa City's former Parks and Recreation Director, had a dream:
to turn a former sand and gravel quarry south of Iowa City into a recreational area that
would become a destination point for people who love the outdoors. On August 24 and 25,
2013, his dream became a reality as the Iowa City Parks and Recreation Department and
Parks and Recreation Foundation hosted a grand opening for the Terry Trueblood
Recreation Area, located at 579 McCollister Boulevard.
Sadly, Trueblood, who worked for the City from 1986 to 2009, did not witness the
dedication of the park that now bears his name. He died of pancreatic cancer in 2009, just
three years after the quarry was acquired and plans for the recreation area were getting
underway. But his vision has proved to be right on target, as the City's newest park has
already gained an active following from outdoor enthusiasts who regularly visit to enjoy its
207 acres of riverfront, lake, prairie, and timber, and utilize numerous recreational
amenities including picnic shelters, fishing piers and jetties, and a paved trail around the 95-
acre lake.
The latest construction projects at the Terry Trueblood Recreation Area unveiled during the
grand opening include The Park Lodge (pictured on the front cover), which is available for
weddings and special event rental, and a small boat marina that provides canoes, kayaks
and other outdoor equipment for short -term rental.
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
CITY OF IOWA CITY, IOWA
FOR THE FISCAL YEAR ENDED JUNE 309 2013
PREPARED BY:
FINANCE DEPARTMENT
CITY OF IOWA CITY, IOWA
CITY OF IOWA CITY, IOWA
TABLE OF CONTENTS
June 30, 2013
Page
INTRODUCTORY SECTION
Tableof contents ................................................................................................. ...............................
1
Letterof transmittal ............................................................................................. ...............................
3
Certificate of Achievement for Excellence in Financial Reporting .................... ...............................
13
Cityorganizational chart ..................................................................................... ...............................
14
Cityofficials ........................................................................................................ ...............................
15
101 10 "We] r "I ILI DCII I LOW
INDEPENDENT AUDITOR'S REPORT .......................................................... ............................... 17
MANAGEMENT'S DISCUSSION AND ANALYSIS ..................................... ............................... 21
BASIC FINANCIAL STATEMENTS
104
Government -wide financial statements
Statementof net position .............................................................................. ...............................
34
Statementof activities ................................................................................... ...............................
36
Fund financial statements
Balance sheet — governmental funds ............................................................. ...............................
38
Reconciliation of the balance sheet of the governmental funds to the statement of net position
40
Statement of revenues, expenditures, and changes in fund balances — governmental funds .......
42
Reconciliation of the statement of revenues, expenditures, and changes in fund balances of
governmental funds to the statement of activities ...................................... ...............................
44
Statement of net position — proprietary funds ............................................... ...............................
46
Statement of revenues, expenses, and changes in fund net position — proprietary funds ............
48
Statement of cash flows —proprietary funds ................................................. ...............................
50
Statement of fiduciary assets and liabilities .................................................. ...............................
52
Notes to financial statements ........................................................................... ...............................
53
REQUIRED SUPPLEMENTARY INFORMATION
Budgetary comparison schedule — budget and actual — all governmental funds and enterprise
funds — budgetary basis ...................................................... ............................... 98
Budgetary comparison schedule — budget to GAAP reconciliation .... ............................... 100
Note to required supplementary information — budgetary reporting .... ............................... 101
Note to required supplementary information — schedule of funding progress for health and dental
plans.............................................................................. ............................... 102
KILL I I] IL411►[I1:\►1 III 1►111WVAI111L11 N KlIL411739KV I"a I UL40 W
Combining balance sheet — nonmajor governmental funds ............................. ...............................
104
Combining statement of revenues, expenditures, and changes in fund balances — nonmajor
governmentalfunds ....................................................................................... ...............................
105
Combining statement of net position — nonmajor enterprise funds ................. ...............................
108
Combining statement of revenues, expenses, and changes in fund net position — nonmajor
enterprisefunds ............................................................................................. ...............................
109
Combining statement of cash flows — nonmajor enterprise funds ................... ...............................
110
Combining statement of net position — internal service funds ......................... ...............................
112
Combining statement of revenues, expenses, and changes in fund net position — internal service
funds.............................................................................................................. ...............................
113
CITY OF IOWA CITY, IOWA
TABLE OF CONTENTS
June 30, 2013
Page
COMBINING AND INDIVIDUAL FUND STATEMENTS (continued)
Combining statement of cash flows — internal service funds ........................... ............................... 114
Statement of changes in assets and liabilities — agency funds .......................... ............................... 116
STATISTICAL SECTION (UNAUDITED)
Netposition by component .................................................................................. ...............................
119
Changesin net position ....................................................................................... ...............................
120
Fund balances — governmental funds .................................................................. ...............................
122
Changes in fund balances — governmental funds ................................................ ...............................
123
General government tax revenues by source ....................................................... ...............................
124
Assessed and taxable value of property ............................................................... ...............................
125
Property tax rates —direct and overlapping governments ................................... ...............................
126
Properly tax budgets and collections ................................................................... ...............................
127
Principaltaxpayers .............................................................................................. ...............................
128
Principal water system customers ....................................................................... ...............................
130
Sales history and total water charges ................................................................... ...............................
131
Principal sewer system customers ....................................................................... ...............................
132
Sales history and total sewer charges .................................................................. ...............................
133
Ratios of outstanding debt by type ...................................................................... ...............................
134
Ratios of general obligation bonded debt to assessed value and net bonded debt per capita .............
135
Ratio of annual debt service expenditures for general bonded debt to total general governmental
expenditures...................................................................................................... ...............................
136
Computation of direct and overlapping debt ....................................................... ...............................
137
Legal debt margin information ............................................................................ ...............................
138
General obligation debt annual maturity schedule .............................................. ...............................
139
Schedule of revenue bond coverage .................................................................... ...............................
140
Revenue debt annual maturity schedule .............................................................. ...............................
141
Revenue debt annual maturity by funding source ............................................... ...............................
142
Demographic and economic statistics ................................................................. ...............................
144
Principalemployers ............................................................................................. ...............................
145
Full -time equivalent city government employees by function ............................ ...............................
146
Operating indicators by function ......................................................................... ...............................
148
Capitalassets by function .................................................................................... ...............................
150
COMPLIANCE SECTION
Independent auditor's report on internal control over financial reporting and on compliance and
other matters based on an audit of financial statements performed in accordance with Government
AuditingStandards .............................................................................................. ............................... 153
Independent auditor's report on compliance for each major federal program and report on internal
control over compliance required by OMB Circular A- 133 ................................ ............................... 155
Schedule of expenditures of federal awards ........................................................ ............................... 157
Notes to the schedule of expenditures of federal awards .................................... ............................... 162
Schedule of findings and questioned costs .......................................................... ............................... 163
Summary schedule of prior federal audit findings .............................................. ............................... 167
0a
December 19, 2013
To the Citizens, Honorable Mayor, Members
of the City Council and City Manager
City of Iowa City, Iowa
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CITY OF IOWA CITY
The Comprehensive Annual Financial Report (CAFR) of the City of Iowa City, Iowa (the City)
for the fiscal year ended June 30, 2013 is submitted herewith in accordance with the provisions of
Chapter 11 of the Code of Iowa. The City's Finance Department prepared this report.
Responsibility for both the accuracy of the data presented and the completeness and fairness of
the presentation, including all disclosures, rest with the City. I believe the information, as
presented, is accurate in all material respects and presented in a manner designed to fairly present
the financial position and results of operations of the City. All disclosures necessary to enable the
reader to gain an understanding of the City's financial affairs have been included.
This report consists of management's representation concerning the finances of the City of Iowa
City. Management assumes full responsibility for the completeness and reliability of all of the
information presented in this report. To provide a reasonable basis for making these
representations, management of the City has established a comprehensive internal control
framework that is designed both to protect the government's assets from loss, theft, or misuse and
to compile sufficient reliable information for the preparation of the City's financial statements in
conformity with accounting principles generally accepted in the United States of America
(GAAP). Because the cost of internal controls should not outweigh their benefits, the City's
comprehensive framework of internal controls has been designed to provide reasonable rather
than absolute assurance that the financial statements will be free from material misstatement. As
management, we assert that to the best of our knowledge and belief, this financial report is
complete and reliable in all material respects.
The CAFR reflects all funds of the City in accordance with standards set by the Governmental
Accounting Standards Board (GASH). In 1999, GASH adopted Statement No. 34, Basic
Financial Statements — Management's Discussion and Analysis — For State and Local
Governments. The final effective date for the implementation of GASH No. 34 for the City of
Iowa City was June 30, 2003. This report complies with those standards. This statement
significantly changes governmental financial reporting in order to bring it closer to a private
sector model.
The City implemented GASH Statement No. 54, Fund Balance Reporting and Governmental
Fund Type Definitions effective with the June 30, 2011 financial statements. Fund balances for
the governmental funds are reported in classifications that comprise a hierarchy based on the
extent to which the government honors constraints on the specific purposes for which amounts in
those funds can be spent. The classifications include: nonspendable amounts that are not in
spendable form or the City is legally or contractually required to be maintained intact; restricted
amounts contain restraint on their use externally imposed by creditors, grantors, contributors, or
laws or regulations of other governments, or imposed by law through constitutional provisions or
enabling legislation; committed amounts can only be used for specific purposes imposed by
formal action of the government's highest level of decision - making authority; assigned amounts
3
are intended to be used for specific purposes; and the unassigned fund balance is the residual
classification for the General Fund.
Chapter 11 of the Code of Iowa requires an annual audit to be performed. The independent public
accounting firm of Eide Bailly LLP was selected by the City. In addition to meeting the
requirements set forth in Chapter 11, the audit was also designed to meet the requirements of the
Single Audit Act of 1996 and related Office of Management and Budget (OMB) Circular A -133,
Audits of States, Local Gavernments and Non - Profit Organizations.
While, the financial statements are the responsibility of the City, the responsibility of the auditor
is to express an opinion on the City's financial statements based on their audit. The goal of the
independent audit is to provide reasonable assurance that the City's financial statements for the
fiscal year ended, June 30, 2013 are free of material misstatement. The audit is conducted in
accordance with generally accepted auditing standards and involves examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements; assessing the
accounting principles used and significant estimates made by management; and evaluating the
overall financial statement preparation.
The independent auditor concluded, based upon the audit, that there was a reasonable basis for
rendering an unmodified opinion that the City of Iowa City's financial statements for the fiscal year
ended, June 30, 2013, are fairly presented in conformity with GAAP. The independent auditors'
report on the basic financial statements and combining and individual fund statements and
schedules is included in the financial section of this report.
As a recipient of federal financial assistance, the City is responsible for ensuring that adequate
internal controls are in place to ensure compliance with applicable laws and regulations related to
these federal programs. These internal accounting and administrative controls are subject to
periodic evaluation by the City's management and the City is required to undergo an annual single
audit in conformity with the provisions of the Single Audit Act of 1996 and the U.S. Office of
Management and Budget (OMB) Circular A -133, Audits of State, Local Gavernments and Non -
Profit Organizations. Information related to this single audit, including the schedules of federal
financial assistance, findings and questioned costs, and independent auditors' reports on the
internal accounting and administrative controls and compliance with applicable laws and
regulations are included in the compliance section of this report.
GAAP require that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD &A). This letter of transmittal is designed to complement the MD &A and should be read in
conjunction with it. The City's MD &A can be found immediately following the report of the
independent auditors.
Profile of the Government
The City of Iowa City was incorporated April 6, 1853. The City is governed by a seven member
Council; each member serves a four -year term. Elections are held every two years allowing for
continuation in office of at least three members at each biennial election. The Council members are
elected at large, with three members nominated from specific districts and the remaining four
members nominated at large. The Council elects the Mayor from its own members for a two -year
term.
The City Council is the legislative body and makes all policy determinations for the City through
the enactment of ordinances and resolutions. It also adopts a budget to determine how the City will
obtain and spend its funds. The Council appoints members of boards, commissions and
committees.
The City Manager is the chief administrative officer for the City and is appointed by the City
Council. The City Manager implements policy decisions of the City Council and enforces City
ordinances. In addition, the City Manager appoints and directly supervises the directors of the
City's operating departments and supervises the administration of the City's personnel system. The
Manager supervises 543 full -time and 58 part -time permanent municipal employees and 524
temporary employees, including a police force of 82 sworn personnel and a fire department of 63
firefighters.
The City Clerk is appointed by the City Council and reports to the Council. The City Clerk's
Office administers the City government's documentation, City licenses and permits, and provides
information from the Municipal Code and City Ordinances to the public and other City
departments. The City Clerk's Office is also responsible for distributing and maintaining accurate
records of all City Council proceedings. The Clerk supervises 3 full-time employees and 1
temporary employee.
The City Attorney is also appointed by the City Council and works at the direction of the City
Council. The City Attorney supervises the City Attorney's Office, including 4 Assistant City
Attorneys and 2 other full-time employees. In addition, the City Attorney acts as Chief Legal
Counsel to the City Council, City Manager, the various City departments and staff, and most City
commissions, committees and boards.
The City provides a full range of services including police and fire protection, construction and
maintenance of roads, streets and infiastructure, inspection and licensing functions, a municipal
airport library, recreational activities, and cultural events. The City owns and operates its water
supply and distribution system and sewage collection and treatment system with secondary
treatment also provided. Virtually the entire City has separate storm and sanitary sewer systems.
The City operates a municipal off - street and on- street parking system in the downtown area. The
City also operates a transit system.
The annual budget serves as the foundation for the City's financial planning and control. All
departments of the City are required to submit requests for appropriation to the City Manager in
October. The City Manager uses these requests as the starting point for developing a proposed
budget. The City Manager then presents this proposed budget to the Council for review in
December. The Council is required to hold a public hearing on the proposed budget and to adopt a
final budget no later than March 15. The appropriated budget is prepared by fund, function (e.g.,
Public Safety), and department (e.g., Police).
The City adopts a three -year financial plan that includes both operations and capital improvements.
This three -year plan permits a more comprehensive review of the City's financial condition,
allowing analysis of the current and fixture needs and requirements. During preparation of the plan,
careful review is made of property tax levy rates, utility and user fee requirements, ending cash
balances by fund, debt service obligations, bond financing needs, capital outlay for equipment
purchases and major capital improvement projects. The state requires at least a one -year operating
budget. While legal spending control is exercised at a state mandated function level, management
control is set at the Department Manager level. Encumbrance accounting is utilized in all funds for
budgetary control. Appropriations that are not spent lapse at the end of the year.
tit
Information Useful in Assessing the Government's Economic Condition
The City's economic strength is based on the educational sector, medical services, and diversified
manufacturing. The University of Iowa and the University of Iowa Hospital and Clinics are the
City's largest employers with over 30,800 employees. The University of Iowa had a record high
enrollment in 2012 and fall semester 2013 enrollment remained steady with 21,970 undergraduate
students. The academic and research missions of the University, along with the health care
services provided at its hospitals and clinics, have a tremendously positive economic impact on
the area.
The City also has a significant number of national and international businesses, including Fortune
500 companies. The City continues to see sustained production in our major local industries; ACT
Inc., NCS Pearson, and Proctor & Gamble. While established firms continue to prosper and
expand in Iowa City, opportunities are available for growth of new businesses. Continued
economic development efforts with the Iowa City and Coralville Chambers of Commerce, private
interests, the University of Iowa, other surrounding communities, and participation as a member of
the Iowa City Area Development Group, have produced positive results with the retention and
expansion of businesses.
In addition, Iowa's Creative Corridor is a seven - county alliance surrounding Iowa City and has
been identified as one of the major growth areas for new business development in the State of Iowa.
This Corridor gives employers workforce access to a region uniquely Iowan, founded with a
manufacturing heritage, but actively seeking new frontiers and opportunities in information
technology, biotechnology and bioprocessing, renewable energy, insurance and financial services,
advanced manufacturing, and educational services. Continued developments within Iowa City and
the region have a favorable impact upon the City's economy.
As a whole, the City's economy continues to grow, but at a slow pace. The major employers have
been able to maintain steady employment during the national recession as evidence in the
unemployment rate for Iowa City, which continues to remain low at 3.8% for the month of June
2013, as compared to 4.6% for the State of Iowa, and 7.6% for the national average.
The rate of new housing construction increased in comparison to the prior year based on the
number of building permits issued. This consisted of 143 new single - family houses in 2012, as
compared to 80 in 2011; multi - family dwelling units added to the tax rolls for the year ended
December 31, 2012 was 144, compared to 76 in 2011; and mixed commercial and residential
developments added in 2012 included 100 residential units. Altogether these additions totaled
$67,065,000 in 2012, an increase of $21,479,000 from prior year.
Permits for commercial construction increased from $12,113,000 in 2011 to $25,758,000 in 2012.
And remodeling permits for residential and commercial also increased by $4,555,000 from 2011
to 2012.
According to the 2010 census, the population of Iowa City is 67,862. This is an increase of 5,672
or 9.1% as compared to the 2000 census. Current population is estimated to be 70,133.
There are many signs that the City remains healthy and vibrant with great promise for the fixture.
The stability of the University of Iowa coupled with historically steady employment by the City's
multi- sector base of manufacturing and service industries, helped insulate the City from any
significant negative economic impacts of the national recession. The City's property valuations
continue to rise and along with the low unemployment rate, this is indicative of the City's relative
economic stability.
rl
Major Initiatives
The City of Iowa City, with the assistance of the University of Iowa's Institute of Public Affairs,
completed the City's Strategic Plan. The strategic planning process involved multiple steps,
including gathering input from the general public, front -line City staff, department directors, and the
City Council. The Strategic Plan established the prevailing organizational priorities as the
following:
1. Neighborhood Stabilization
2. Economic and Community Development
3. Development of the Downtown and Near Downtown Areas
4. A Strong and Sustainable Financial Foundation
5. Coordinated Communication and Customer Service Orientation
The first priority from the City's Strategic Plan that will impact the City's economy is
neighborhood stabilization. The Council has indicated a strong desire to stabilize the
neighborhoods surrounding the city core. An effective stabilization strategy requires a review
and analysis of the City's policies, programs, communications, and capital investment decisions
that directly shape and influence a neighborhood's character and livelihood. Staff will be
focusing on the central planning district neighborhoods; however many aspects of the
neighborhood stabilization review will have implications throughout the community. In order to
achieve the Council's goal, staff will focus on the land use regulations, public infrastructure and
open space, private building stock, nuisance mitigation, open stakeholder communication, and
updating planning documents. Projects to further neighborhood stabilization include the
UniverCity Neighborhood Partnership, a joint project between the City and the University of
Iowa to ensure the neighborhoods around the university remain vital, safe, affordable, and
attractive places to live and work for both renters and homeowners by acquiring and rehabilitating
homes near the University of Iowa campus for resale as affordable owner- occupied housing.
Staff will also be actively working with the Iowa City Community School district to promote
increased coordination in school and neighborhood planning as neighborhood schools play a role
in neighborhood stabilization efforts. The City also continues to invest in neighborhood parks,
trails, and events.
The City Council has indicated a strong desire to promote private investment in established
commercial areas and strategic green -field sites that have previously been targeted for new
development. The areas that are currently being focused on include the Towncrest commercial
area, Sycamore Mall and First Avenue, Highway 6/11ighway 1 intersection, 420`" Street Industrial
Park, and Moss Office and Northgate Corporate Parks.
In the Towncrest commercial area, City staff is working to facilitate redevelopment of several key
properties and a streetscape project that will improve the function and aesthetic appeal of the area.
The Towncrest Urban Renewal Area was developed to revitalize the Towncrest commercial
district in ways that would serve existing businesses while also drawing new retailers, service
providers, and consumers to the area. The first catalyst project approved in the Towncrest Urban
Renewal Area was a developer's agreement with MDK Development LLC for the redevelopment
of a gas station and a building used for storage at the corner of Muscatine Avenue and William
Street. MDK Development LLC purchased both properties, demolished the buildings and is
currently constructing two new buildings with a combined square footage of 14,500. The two
buildings will be primarily medical offices — home to Eye Associates and Towncrest Dental. A
third commercial condo, approximately 2,000 SF is available for lease /purchase. Total project
costs for this development are estimated at $5,200,000. The City's cost for the Towncrest
Renewal are estimated at $2,693,000 and will be paid with tax receipts, transfers from TIT, and
II
GO bonds.
The departure of an anchor tenant at Sycamore Mall presented a great challenge, but also a
unique opportunity to reinvent the commercial space. Mall ownership has plans for physical
improvements to the property and the City is coordinating four significant capital projects in the
area that are expected to last two or more construction seasons. These projects include
improvements to Sycamore and Lower Muscatine Roads, a grade separation project on First
Avenue, and repaving of Highway 6. These projects, which are underway in different phases,
will each have a positive impact on the traffic flows and aesthetics in this commercial district.
Total cost for these projects is $17,921,000 and will be paid from a variety of sources including
GO bonds, federal and state grants, road use tax, and utility operations.
The Highway 6 /Highway 1 intersection is a viable commercial corridor, in large part because of
high traffic counts. Staff has focused efforts on municipal public works and transit property in
the area. As the City relocates municipal operations from this area, prime development space will
become marketable. Staff is working on environmental reviews and preparing a request for
proposal for potential development. Total costs for relocating facilities, abatement and land
preparation, as well as, aesthetic improvements are estimated to be $32,575,000 and will be paid
with GO bonds and federal grants.
The City has invested considerable money in infrastructure development and achieved shovel
ready status from the State of Iowa for the 420`" Street Industrial Park. This project involved
annexing and rezoning 180 acres of land and building the street, water, and sewer infrastructure
needed to support industrial businesses. The Iowa City Area Development Group and City staff
continue to market this properly and respond to inquiries from business and site location
consultants. This project costs were $13,762,000 and were funded through bonds, state grants,
road use tax, and wastewater operations.
The City has established an urban renewal area for the development of Moss Office Park, a 243 -
acre, 18 -lot office research and mix use subdivision on the northeast edge of the city, just off
Interstate 80. Significant infrastructure improvements are necessary to accommodate the planned
growth and City staff is working with Moss Office Park owners and adjacent businesses on
potential access arrangements to accommodate a phased development approach to this property.
Northgate Corporate Parr adjacent to Moss Office Parr continues to experience build out.
Project costs to build the infrastructure are $3,500,000 and are being funded with state grants and
GO bonds.
The third priority of the Strategic Plan is the development of the Downtown and Near Downtown
Areas. Staff is focusing on two distinct geographic areas: Downtown Iowa City and Riverfront
Crossings.
In 2012, the Iowa City Downtown District (ICDD), a self - supported municipal improvement
district, was formed presenting a unique opportunity to bring together property owners,
businesses, the University of Iowa, and the City of Iowa City. Staff, in partnership with
stakeholders, is working to pursue policies and projects that will more fully realize the potential
of the central business district and facilitate new private investment in the area. Some of the
ICDD current initiatives include a downtown community gallery for public art and science
programs, free Wi -Fi in the Pedestrian Mall, holiday lighting, improved snow removal,
downtown ambassadors to assist visitors and maintain public spaces, alley beautification, and a
downtown beat cop. The City has also instituted new a parking rate structure, including first hour
free to make visiting downtown more convenient.
s
Capital projects that directly impact the Downtown region are the completion of the conversion of
Washington Street from one -way to two -way traffic to improve vehicular and pedestrian traffic
flow and the downtown maintenance project that will improve the physical condition of the
infrastructure and streetscape. The cost of the CBD maintenance project is estimated $1,917,000
and is being funded with GO bonds and transfers from TIT districts. The Library is also in the
midst of a remodeling project of the public space at a cost of $403,000. Other projects that will
have a positive impact on downtown include is the University of Iowa's Voxman -Clapp Music
Building at the corner of Clinton and Burlington Streets and the private development of a multi-
use building on land that is currently owned by the City.
The Riverfront Crossing Development Plan is an initiative to revitalize the area south of Iowa
City's downtown area. This area was hard hit by the flooding in 2008 and ideas for improving
the district were initiated as part of a combined flood mitigation plan. Through a grant from the
Partnership for Sustainable Communities the City, the City created a detailed plan for developing
the area. The new neighborhood will feature a waterfront park with walking and biking trails,
access to the Iowa River for boating and fishing, a variety of housing options near shopping,
restaurants, a state -of -the -art recital hall and recreational facilities and just a short walk to
downtown Iowa City and the University of Iowa campus.
Several capital projects are either underway or being considered that would directly impact the
short - and long -term marketability of the Riverfront Crossing area. These projects include
purchasing and rehabilitating the train depot, working with a private partner to develop a mix -use
parking facility adjacent to downtown Iowa City which will include three components: parking
facility consisting of approximately 600 parking spaces, commercial space of approximately
25,000 — 35,000 square feet, and 25 - 75 workforce housing units. And a third project is the
decommissioning of the north wastewater plant by expanding the south wastewater plant. This
relocation project has costs totaling $61,217,000 and is being funded through federal and state
grants, local option taxes, and wastewater revenues.
The City aims to create a strong and sustainable financial foundation that will provide needed
stability and flexibility while utilizing taxpayer dollars in the most efficient and responsible
manner. In order to achieve this goal, the City is focusing on two primary areas: new financial
policies and strategies that will provide a greater level of financial stability and second, enhance
the level of financial analysis presented to the public so elected officials will have a greater
information foundation on which to base future decisions. Policies included in this analysis are
economic development policies, purchasing policies and procedures, target fund balances, debt
service coverage levels, general fund contingency level, and an annual review of rates, user
charges and fines. The City has also examined operations where the City is providing subsidized
service beyond our borders and developed plans to ensure the City is being equitably reimbursed
for such services. In June 2013, Moody's conducted a review of the City as part of the bond
rating process and reaffirmed the City's Aaa bond rating. In their report, Moody said the rating
"reflects the City's stable tax base and economy anchored by the University of Iowa... history of
favorable financial operations and expected maintenance of healthy reserves, and manageable
debt profile."
The fifth and final priority of the City's Strategic Plan is coordinated communication and
customer service orientation. The City strives to be a high - functioning, customer service
orientated organization that actively supports and engages stakeholders through clear, open, and
innovative communication methods. A reorganization of staff created a new communication
team, which has assumed the responsibilities of the front desk at City Hall and offers front line
customer service assistance to visitors and those contacting City Hall via phone or email. The
City launched a redesigned homepage and introduced a City Facebook and Twitter page. These
�;
communication improvements have allowed the City to reach broader audiences and better
promote activities, community news, and service information. The City also introduced
ICgovXpress; a convenient way for Iowa City residents to request services, ask questions, or
submit citizens reports of everything from trash and debris in unkempt yards to abandoned cars,
unshoveled walks, and graffiti either online or by downloading the ICgovXpress app to their
smart phone.
The City has also completed the first phase of implementing enterprise resource planning
software (ERP). On July 1, 2013 the financials modules of general ledger, accounts payable,
purchasing, and budget went live. The human resources and payroll sections are scheduled to go
live January 1, 2014. And the utility billing and revenues portions will be implemented in the fall
of 2014. The ERP system will allow for improved internal workflows and internal and external
communication. The cost of this project is $1,876,000 and is being paid with GO bonds, water,
wastewater, sanitation, and stormwater revenues.
On May 14, 2013, City Council adopted the Iowa City 2030 Comprehensive Plan (IC2030). The
City's last comprehensive plan was completed in 1997 and IC2030 provided an opportunity for
the Iowa City community to revisit the vision and goals of the prior plan and assess our progress.
As part of the IC2030, goals and strategies were development in the following areas: land use,
housing, economic development, transportation, environment and resources, parks and open
space, and arts and culture. The IC2030 will influence major initiatives the City undertakes over
the next several years.
Long -term Financial Planning
It is our intent to support the major initiatives through budget appropriations, departmental
operations, and employee direction so that the organization as a whole is moving in the same
direction.
A significant influence in the preparation of the three -year financial plan (FY15 — FY17) is the
passage of property tax reform (SF295) by the state legislature. The properly tax reform bill has
multiple components including a property tax rollback for commercial and industrial property,
steadily reducing the taxable value of these property types. The bill establishes a standing
appropriation for the State to backfill lost revenues to the City due to the commercial and
industrial rollback beginning in FY15 and then caps the amount at FY17 levels. The cumulative
reduction in commercial and industrial property taxes due to this rollback is estimated to be
$15,418,000 over the next ten years. The maximum reimbursement from the State would be
$14,732,000 for a net loss in revenues of $686,000.
This bill also limits the annual taxable valuation growth of residential and agricultural property to
3 percent instead of the current 4 percent. Initially, the financial impact will be minimal but over
time the consequences of this change will be significant. The effect will be that the taxable
percentage of residential property will increase at a slower pace. Without this change, the
estimated taxable percentage of residential property would be 60.85% in assessment year 2022.
With this provision in place, the estimated taxable percentage in year 2022 will be 55.11 %, a
reduction of 5.74 %. Based on the assessed value of residential property in Iowa City, the
cumulative loss is estimated to be $20,772,000 over the next ten years and the City will not
receive any money from the State due to lost revenue from this provision.
SF295 also establishes a multi - residential property classification that will include mobile home
parks, assisted living facilities, and property primarily intended for human habitation. A gradual
rollback will be applied to these properties that will basically treat them as residential property,
10
rather than commercial, by the year 2022. The estimated cumulative loss over the next ten years
is $15,505,000 and will not be reimbursed by the State of Iowa.
With the implementation of S17295, the City estimates the tax revenue losses to be $1,785,000 for
FY15 — FY17. Since some of the effects of these reforms are gradual, the magnitude of the losses
will not be felt till later years and the total cumulative ten -year loss is anticipated to be
$36,963,000, which will significantly affect the City's ability to finance services at current levels
without finding other revenue sources.
On a more positive note, the City is seeing a small but steady growth in assessed property
valuations when compared with prior years. And based on the increase in building permits in
2012, assessed valuations should increase at greater pace in the future.
In looking at expenses for the FY15 — FY17 financial plan, the City will experience increased
expenditures, specifically an increase in bargaining unit contract costs exceeding 2 %, additional
federal and state regulations and mandates, and rising public safety retirement funding.
In balancing the budget for the three -year period, the City attempted to reduce costs where
possible, while continuing to provide high quality services; identify and eliminate redundancies
that may exist within the organization; examine existing and potential new revenue sources;
promote and plan for economic development and redevelopment throughout the City to ensure
strong property values; determine appropriate staffing levels; provide for necessary improvements
to existing infrastructure and prioritize capital projects; and uphold fiscal integrity and maintain
adequate cash reserves. The City also continues to strive to reduce the City's total property tax
levy. For collection year 2012, the levy was $17.842 per $1,000 of assessed value. In 2013, the
levy was $17.269, a reduction of 3 percent. And for 2014, the levy is $16.805, a reduction of 3
percent. The consequences of reduced revenues and increased expenses will require continued
review of city operations, service delivery, and alternative revenue sources.
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting (the Certificate) to the City of
Iowa City, Iowa for its Comprehensive Annual Financial Report for the fiscal year ended June 30,
2012. The Certificate is the highest form of recognition for excellence in state and local financial
reporting.
In order to be awarded the Certificate, a governmental unit must publish an easily readable and
efficiently organized Comprehensive Annual Financial Report, whose contents conform to program
standards. The Comprehensive Annual Financial Report must satisfy both accounting principles
generally accepted in the United States of America and applicable legal requirements.
The Certificate is valid for a period of one year only. The City has received the Certificate for the
last twenty -eight consecutive years. I believe our current report continues to conform to the
Certificate requirements and I will submit it to GFOA to determine its eligibility for another
certificate.
In addition, the City received the GFOA's Award for Distinguished Budget Presentation for its
annual appropriated budget beginning July 1, 2013. In order to qualify for the Distinguished
Budget Presentation Award, the City's budget document was judged to be proficient or outstanding
in several categories including policy documentation, financial planning, and organization. This is
the second consecutive year the City has received this award.
11
Responsibility and Acknowledgments
The Department of Finance prepared the Comprehensive Annual Financial Report of the City of
Iowa City, Iowa for the fiscal year ended June 30, 2013. The City Council, as required by law, is
responsible for the complete and accurate preparation of the City's Comprehensive Annual
Financial Report. I believe that the information presented is accurate in all material respects and
that this report fairly presents the financial position and results of operations of the various funds
of the City.
The preparation of this report on a timely basis could not have been accomplished without the
efficient and dedicated services of the entire staff of the City's Finance Department. I would like to
express my appreciation to all members of the department who assisted and contributed to its
preparation. I want to especially recognize the contributions of the City's Controller, Robin
Marshall, Assistant Controller, Sara Sproule, Internal Auditor, Nickolas Schaul, Senior Accountant,
Justin Armatis and Payroll Accountant, Chris Hurlbert.
Also, I thank the Mayor, members of the City Council and the City Manager for their interest and
support in planning and conducting the financial operations of the City in a dedicated, responsible,
and progressive manner.
Respectfully submitted,
�1, 7 :�
Dennis Bockenstedt
Director of Finance
12
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Iowa City
Iowa
For its Comprehensive Annual
Financial report
for the Fiscal Year Ended
.Marne 30, 2012
Executive QirWLOE /CEO
13
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Mayor
Council Member and Mayor Pro Tern
Council Member
Council Member
Council Member
Council Member
Council Member
City Manager
City Clerk
City Attorney
CITY OF IOWA CITY, IOWA
LISTING OF CITY OFFICIALS
June 30, 2013
ELECTED OFFICIALS
Matt Hayek
Susan Mims
Connie Champion
Terry Dickens
Rick Dobyns
Michelle Payne
Jim Throgmorton
APPOINTED OFFICIALS
Thomas Markus
Marian K. Karr
Eleanor Dilkes
DEPARTMENT DIRECTORS
Assistant to City Manager
Director of Housing and Inspection Services
Library Director
Director of Planning & Community Development
Director of Public Works
Director of Transportation Services
Senior Center Coordinator
Interim Fire Chief
Parks and Recreation Director
Director of Finance
Chief of Police
Geoff Fruin
Douglas W. Boothroy
Susan Craig
Jeff Davidson
Rick Fosse
Chris O'Brien
Linda Kopping
Roger Jensen
Mike Moran
Dennis Bockenstedt
Sam Hargadine
15
Term Expires
January 2, 2016
January 2, 2014
January 2, 2014
January 2, 2014
January 2, 2016
January 2, 2016
January 2, 2016
Date of Hire
December 1, 2010
May 21, 1979
March 18, 1996
November 28, 2011
September 22, 1975
July 28, 1975
January 26, 1981
February 22, 1984
December, 29, 1997
March 20, 1995
June 15, 1987
September 26, 1983
February 15, 2013
August 29, 2005
i[8
EideBailly.
CPAs S, BUSINESS ADVISORS
Independent Auditor's Report
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa,
(City) as of and for the year ended June 30, 2013, and the related notes to the financial statements, which
collectively comprise the City's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
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 opinions 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 and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. 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 auditor's 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 opinions.
17
www.eidebailly.com
3999 Pennsylvania Ave., Ste. 100 1 Dubuque, IA 52002 -2273 1 T 563.556.1790 1 F 563.557.7642 1 EOE
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major fund,
and the aggregate remaining fund information of the City of Iowa City, Iowa, as of June 30, 2013, and the
respective changes in financial position and, where, applicable, cash flows thereof for the year then ended
in accordance with accounting principles generally accepted in the United States of America.
Restatement Due to Change in Reporting Entity
As discussed in Note 15 to the financial statements, the City changed the components of the reporting
entity during the year, and accordingly, has restated the related fund balances and net position as of
June 30, 2012.
Restatement Due to Correction of an Error
As discussed in Note 16 to the financial statements, the City changed its calculation of the Landfill
Closure and Postclosure Care liability during the year, and accordingly, has restated the related net
position as of June 30, 2012.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and other required supplementary information listed in the table of contents be
presented to supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who considers it to be
an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United States
of America, which consisted of inquires of management about the methods of preparing the information
and comparing the information for consistency with management's responses to our inquires, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial statements.
We do not express an opinion or provide any assurance on the information because the limited procedures
do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City of Iowa City, Iowa's financial statements. The introductory section, combining
nonmajor fund financial statements, and statistical section are presented for purposes of additional
analysis and are not a required part of the financial statements. The accompanying schedule of
expenditures of federal awards is presented for purposes of additional analysis as required by U.S. Office
of Management and Budget Circular A -133, Audits of States, Local Governments, and Non - Profit
Organization, and is also not a required part of the financial statements.
The combining nonmajor fund financial statements and the schedule of expenditures of federal awards are
the responsibility of management and were derived from and relate directly to the underlying accounting
and other records used to prepare the basic financial statements. Such information has been subjected to
the auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying accounting
and other records used to prepare the basic financial statements or to the basic financial statements
themselves, and other additional procedures in accordance with auditing standards generally accepted in
the United States of America. In our opinion, the combining nonmajor fund financial statements and the
schedule of expenditures of federal awards are fairly stated, in all material respects, in relation to the basic
financial statements as a whole.
18
The introductory and statistical sections have not been subjected to the auditing procedures applied in the
audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued a report dated December 19,
2013, on our consideration of the City of Iowa City, Iowa's internal control over financial reporting and
on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements,
and other matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on the
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City's internal control
over financial reporting and compliance.
,4 Z, 7"�'
Dubuque, Iowa
December 19, 2013
IM
(This page left blank intentionally.)
-20-
Management's Discussion and Analysis
As management of the City of Iowa City, we present this narrative overview and analysis of the financial
activities of the City for the fiscal year ended June 30, 2013. This narrative is intended to be used in
conjunction with additional information that is included in the letter of transmittal, which can be found on
pages 3 — 12 of this report.
Financial Highlights
• The assets of the City of Iowa City exceeded its liabilities at the close of the fiscal year ending June 30,
2013 by $554,620,000 (net position). Of this amount, $125,114,000 (unrestricted net position) may be
used to meet the government's ongoing obligations to its citizens and creditors.
• The City's total net position increased by $64,129,000 during the fiscal year. Governmental activities
increased by $18,370,000 and business -type activities increased by $45,759,000.
• At the close of the current fiscal year, the City's governmental funds reported combined ending fund
balances of $66,879,000, a decrease of $7,519,000 in comparison with the prior year. Of this total
amount, approximately $11,269,000 or 16.8% is unassigned and available for spending at the City's
discretion.
• At the end of the current fiscal year, the City's unassigned fund balance for the General Fund was
$17,113,000 or 39.0% of total General Fund expenditures.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements.
The City's basic financial statements are comprised of three components: 1) government -wide financial
statements, 2) fund financial statements; and 3) notes to the financial statements. This report also contains
other supplementary information in addition to the basic financial statements themselves.
Government -wide Financial Statements: The government -wide financial statements are designed to provide
readers with a broad overview of the City's finances in a manner similar to a private- sector business.
The statement of net position presents information on all of the City's assets and liabilities, with the difference
between the two reported as net position. Over time, increases or decreases in net position may serve as a
useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net position changed during the most
recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the
change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in
this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes
and earned but unused vacation leave).
Both of the government -wide financial statements distinguish functions of the City that are principally
supported by taxes and intergovernmental revenues (governmental activities) from other functions that are
intended to recover all or a significant portion of their costs through user fees and charges (business -type
activities). The governmental activities of the City include Public Safety, Public Works (roads and traffic
controls), Culture and Recreation, Community and Economic Development, General Government, and
Interest on long -term debt. The business -type activities of the City include Airport, Cable Television,
Housing Authority, Parking, Sanitation, Stormwater Collection, Transit, Wastewater Treatment, and Water.
21
The government -wide financial statements may be found on pages 34 — 37 of this report
Fund Financial Statements: A fund is a grouping of related accounts that is used to maintain control over
resources that have been segregated for specific activities or objectives. The City, like other state and local
governments, uses fund accounting to ensure and demonstrate compliance with finance- related legal
requirements. All of the funds of the City can be divided into three categories: governmental funds,
proprietary funds, and fiduciary funds.
Governmental Funds: Governmental funds are used to account for essentially the same function reported as
governmental activities in the government -wide financial statements. However, unlike the government -wide
financial statements, governmental fund financial statements focus on near -term inflows and outflows of
spendable resources, as well as on balances of spendable resources available at the end of the fiscal year.
Such information may be useful in evaluating a government's near -term financing requirements and is
typically the basis that is used in developing the next annual budget.
Because the focus of governmental funds is narrower than that of the government -wide financial statements, it
is useful to compare the information presented for governmental funds with similar information presented for
governmental activities in the government -wide financial statements. Both the governmental fund balance
sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a
reconciliation to facilitate this comparison.
The City has six major governmental funds: General Fund, Employee Benefits Fund, Community
Development Block Grant Fund, Other Shared Revenue and Grants Fund, Other Construction Fund, and Debt
Service Fund. Information is presented separately in the governmental funds balance sheet and in the
governmental funds statement of revenues, expenditures, and changes in fund balances for these major funds.
Data from all other non -major governmental funds is combined into a single aggregated presentation and are
referenced under a single column as "Other Governmental Funds ". Individual fund data on each of these non-
major governmental funds is provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget for all governmental funds as required by state statute. Budget
comparisons have been provided for the Governmental funds and the Enterprise funds, to demonstrate
compliance with the adopted budget.
The basic governmental funds financial statements can be found on pages 38 — 44 of this report.
Proprietary Funds: The City maintains two different types of proprietary funds. Enterprise funds are used
to report the same functions presented as business -type activities in the government -wide financial statements.
The City uses enterprise funds to account for its Airport, Cable Television, Housing Authority, Parking,
Sanitation, Stormwater Collection, Transit, Wastewater Treatment, and Water activities. Internal Service
funds are an accounting device used to accumulate and allocate costs internally among the City's various
functions. The City has four Internal Service Funds: Equipment Maintenance, Central Services, Loss
Reserve, and Information Technology. Because these services predominantly benefit governmental rather
than business -type functions, they have been included within governmental activities in the government -wide
financial statements.
Proprietary funds financial statements provide the same type of information as the government -wide financial
statements, only in more detail. Parking, Wastewater Treatment, Water, Sanitation, Housing Authority and
Transit Funds are considered to be major funds and are reported individually throughout the report. The other
three non -major enterprise funds are grouped together for reporting purposes and listed under a single heading
"Other Enterprise Funds ". Detailed information for each of the non -major funds is provided in the combining
statements on pages 108 —110. Individual fund data for the Internal Service funds is provided in the form of
combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 46 — 51 of this report.
rra
Fiduciary Funds: Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. Fiduciary funds are not available to support the City's own programs and therefore are not
reflected in the government -wide financial statements. The City has two fiduciary funds: Project Green and
Library Foundation, which are maintained as agency funds.
The basic fiduciary funds financial statements can be found on page 52.
Notes to Financial Statements: The notes provide additional information that is essential to a full
understanding of the data provided in the government -wide and fund financial statements. The notes to the
financial statements can be found on pages 53 - 97 of this report.
Other Information: The combining statements referred to in the above paragraphs in connection with non-
major governmental funds, non -major enterprise funds, and internal service funds are presented immediately
following the notes.
Government -wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government's financial position.
In the case of the City, assets exceeded liabilities by $554,620,000 at the close of the fiscal year ended June
30, 2013.
By far, the largest portion of the City's net position reflect its investment in capital assets (e.g., land, building,
machinery and equipment, improvements other than buildings, and infrastructure), net any related debt to
acquire those assets that is still outstanding. The City uses these capital assets to provide services to its
citizens; consequently, these assets are not available for future spending. Although the City's investment in
its capital assets is reported net of related debt it should be noted that the resources needed to repay this debt
must be provided from other resources, since the capital assets themselves cannot be used to liquidate these
liabilities.
City of Iowa City's Net Position
June 30, 2013
(amounts expressed in thousands)
PR3
Governmental
Business type
activities
activities
Total
2012
2012
2013 (as restated)
2013 (as restated)
2013
2012
Current and other assets
$ 162,144 $
167,913
$ 110,907 $
102,449
$ 273,051 $
270,362
Capital assets
182,263
171,096
317,564
282,954
499,827
454,050
Total Assets
344,407
339,009
428,471
385,403
772,878
724,412
Long -tenn liabilities outstanding
65,012
78,486
72,048
78,124
137,060
156,610
Current and other liabilities
71,795
71293
9,403
6,018
81,198
77,311
Total Liabilities
136,807
149,779
81,451
84,142
218258
233,921
Net position:
Net investment in
capital assets
133,989
118,603
253,617
212,468
387,606
331,071
Restricted
22,867
35,021
19,033
20,176
41,900
55,197
Unrestricted
50,744
35,606
74,370
68,617
125,114
104223
Total Net Position
$ 207,600 $
189230
$ 347,020 $
301261
$ 554,620 $
490,491
PR3
A portion of the City's net position, $41,900,000 or 7.6 %, represents resources that are subject to external
restrictions on how they may be used. The remaining balance of the unrestricted net position, $125,114,000
or 22.6 %, may be used to meet the government's ongoing obligations to its citizens and creditors. At the end
of the fiscal year ended June 30, 2013, the City is able to report positive balances in all three categories of net
position, both for the government as a whole, as well as for its separate governmental and business -type
activities.
Governmental Activities: Governmental activities increased the City's net position by $18,370,000. The
increase in net position of governmental activities is primarily due to receiving grants to fund expenditures in
capital assets for flood recovery and mitigation and community development projects and collection of a local
option sales tax to be used to fund future capital improvement projects.
The following is a more detailed review of FY13's operation.
City of Iowa City's Changes in No Position
(amounts expressed in thousands)
24
Governmental
Business -type
activities
activities
Total
2012
2012
2012
2013
(as restated)
2013
(as restated)
2013
(as restated)
Revenues:
Program Revenues:
Charges for services
$ 7,688
$ 7,067
$ 39,065
$ 37,183
$ 46,753
$ 44,250
Operating grants and contributions
4,731
6,808
9,224
8,656
13,955
15,464
Capital grants and contributions
6,876
6,078
34,251
6,218
41,127
12,296
General Revenues:
Property taxes
51,017
50,516
-
-
51,017
50,516
Road use tax
6,589
6,394
-
-
6,589
6,394
Local option sales tax
8,858
8,644
-
-
8,858
8,644
Other taxes
2,609
2,491
-
-
2,609
2,491
Earnings on investments
841
1,096
671
1,540
1,512
2,636
Gain on disposal ofcapital assets
1,312
2,950
293
336
1,605
3,286
Other
4,390
4,147
918
565
5,308
4,712
Total revenues
94,911
96,191
84,422
54,498
179,333
150,689
Expenses:
Public safety
20,989
21,186
-
-
20,989
21,186
Public works
10,240
10,369
-
-
10,240
10,369
Culture and recreation
14,481
13,107
-
-
14,481
13,107
Community and economic development
10,596
16,305
-
-
10,596
16,305
General government
7,513
7,591
-
-
7,513
7,591
Interest on long -term debt
2,237
2,400
-
-
2,237
2,400
Wastewater treatment
-
-
10,464
11,069
10,464
11,069
Water
-
-
9,074
8,781
9,074
8,781
Sanitation
-
-
7,279
1,848
7,279
1,848
Housing authority
-
-
7,658
7,911
7,658
7,911
Parking
-
-
4,579
4,167
4,579
4,167
Airport
-
-
1,086
1,127
1,086
1,127
Stormwater
-
-
1,318
1,304
1,318
1,304
Cable television
-
-
692
689
692
689
Transit
6,998
7,187
6,998
7,187
Total expenses
66,056
70,958
49,148
44,083
115,204
115,041
Change in net position before transfers
and extraordinary items
28,855
25,233
35,274
10,415
64,129
35,648
Transfers
(10,485)
(4,606)
10,485
4,606
-
-
Extraordinary items
(5,000)
(5,000)
Change in net position
18,370
20,627
45,759
10,021
64,129
30,648
Net position beginning ofyear, as restated
189,230
168,603
301,261
291,240
490,491
459,843
Net position and ofyear
$ 207,600
$ 189,230
$ 347,020
$ 301,261
$ 554,620
$ 490,491
24
The total revenues for governmental activities for FY13 were $94,911,000. Governmental activities are
primarily funded through taxes, $69,073,000 or 72.8 %, and grants and contributions, $11,607,000 or 12.2 %.
Grants and contributions decreased from prior year by $1,279,000 as the City's expenditures for flood
mitigation, which were covered by supplemental Community Development Block Grants, have decreased.
Expenses for governmental activities totaled $66,056,000. Governmental activities are tracked by function
including Public Safety, Public Works, Community and Economic Development, Culture and Recreation, and
General Government. In FY13, Public Safety accounted for the highest portion of governmental expenses,
$20,989,000 or 31.8 %, and decreased slightly over the prior year due to start -up cost for the addition of a
fourth fire station during FY12 and a reduction in property condemnation. Culture and Recreation,
$14,481,000 or 21.9 %, made up another large portion of the governmental expenses and increased over the
prior year due to the addition of the Terry Trueblood Recreational Area. Community and Economic
Development, $10,596,000 or 16.0 %, made up the third highest portion of governmental expenses and
decreased from the prior year due to fewer flood recovery and mitigation projects.
Business -type Activities: Business -type activities increased the City's total net position by $45,759,000. The
increase in net position was primarily in the Wastewater fund and is due to an increase in capital assets funded
by grants, rather than debt. The City has been able to utilize federal and state grants to fund a flood recovery
and mitigation project decommission of the North Wastewater Plant through expansion of the South
Wastewater Plant rather than have to issue new debt to pay for this project. The Airport fund also saw an
increase in net position due to a capital improvement projects funded through grants. For all business -type
activities, revenues exceeded expenses by $35,274,000.
Revenues for business -type activities totaled $84,422,000. Usually, the primary revenue source for business-
type activities is charges for services. For FY13, these revenues totaled $39,065,000 or 46.3 %. In addition
for FY13, the City's business type- activities had a significant portion, $43,475,000 or 51.5 %, of their
revenues from grants and contributions used to help fund capital and flood recovery projects for business -type
activities. This is an increase of $28,601,000 from the prior year due to additional grants to cover expenses
for the Wastewater flood mitigation project.
The total expenses for business -type activities in FY13 were $49,148,000. Wastewater Treatment represented
the highest portion of business -type activities, $10,464,000 or 21.3 %, with Water, $9,074,000 or 18.5 %,
Housing Authority, $7,658,000 or 15.6 %, Sanitation, $7,279,000 or 14.8 %, and Transit, $6,998,000 or 14.2 %,
making up the remainder of the majority of business -type activities expenses.
The graphs on the following pages represent a breakdown of revenue by source and expenditures by program
area for governmental and business -type activities.
VIA
Governmental Activities
FY2013 Revenue
by Source
Misc.
Other Charges for
Other Taxes
19% 7% services
8%
Property taxes
54%
Grants and
Contributions
12%
Business -Type Activities
FY2013 Revenue
by Source
Charges for
Misc. Other services
2% 46%
rza
Business -Type Activities
FY2013 Expenditures
by Program Area
(amounts expressed in thousands)
14,000
12,000
10,000
8,000
L
R
A 6,000
4,000
2,000
0
Program Area
Wastewater
Treatment
Housing
Water Authority
Sanitaflon
Transit
Parking
Stormw ater
Airport
Governmental Activities
FY2013 Expenditures
by Program Area
(amounts expressed in thousands)
24,000
Public
Safety
22,000
20,000
Culture and
18,000
Recreation
16,000 -
community
and
14,000
Public Econ Dev
12,000
or s
General
A
10,000
Govt
8,000
6,000
Interest
Expense
4,000
2,000
0
Program Area
Business -Type Activities
FY2013 Expenditures
by Program Area
(amounts expressed in thousands)
14,000
12,000
10,000
8,000
L
R
A 6,000
4,000
2,000
0
Program Area
Wastewater
Treatment
Housing
Water Authority
Sanitaflon
Transit
Parking
Stormw ater
Airport
Pil
Cable TV
Pil
Financial Analysis of the Government's Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance- related
legal requirements.
Governmental Funds: The financial reporting focus of the City's governmental funds is to provide
information on near -term inflows, outflows, and balances of spendable resources. Such information may
be /is useful in assessing the City's financing requirements. In particular, unassigned fund balance may serve
as a useful measure of a government's net resources available for spending at the end of the fiscal year.
The City implemented GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type
Definitions effective with the June 30, 2011 financial statements. Fund balances for the governmental funds
are reported in classifications that comprise a hierarchy based on the extent to which the government honors
constraints on the specific purposes for which amounts in those funds can be spent.
As of the fiscal year ended June 30, 2013, the City's governmental funds reported combined ending fund
balances of $66,879,000, a decrease of $7,519,000 in comparison with the prior year. Of this total amount,
$11,269,000 constitutes unassigned fund balance, which is available to use as working capital for the General
Fund since property tax revenues are received only twice a year and the remainder is available to meet the
fixture needs of the City. The remainder of the fund balance is not available for new spending because of
constraints imposed externally by creditors, grantors, contributors, or laws or regulations of other
governments or constraints imposed internally on the specific purposes for which these amounts can be spent.
The restricted fund balance of $53,797,000 or 80.4% contains external restraints on its use. The assigned
fund balance of $1,744,000 or 2.6% has been identified by the City to be used for specific purposes. The
nonspendable fund balance is $69,000 or 0.1 °/q which the City is contractually required to maintain intact or
cannot be spent because it is in a nonspendable format, such as inventories.
The General Fund is the chief operating fund of the City. As of the fiscal year ended June 30, 2013, the
unassigned fund balance of the General Fund was $17,113,000 while General Fund's total fund balance was
$44,615,000. As a measure of the General Fund's liquidity, it may be useful to compare both unassigned
fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 39.0% of
total General Fund expenditures of $43,886,000, while total fund balance represents 101.7% of that same
amount.
During the current fiscal year, the fund balance of the City's General Fund increased by $4,667,000. This
was due to collection of a local option sales tax that took effect in FY10 to be used to fund fixture capital
improvement projects. This tax was collected through FY13.
The fund balance in the Bridge, Street, and Traffic Control Construction Fund was $6,945,000, an increase of
$7,232,000. This fund accounts for transactions relating to the acquisition or construction of major streets,
bridges, and traffic control facilities. The fund balance in the Other Construction Fund was $4,242,000, a
decrease of $16,604,000. This fund accounts for the construction or replacement of other governmental
general capital assets, such as administrative buildings, with various funding sources, including general
obligation bonds, intergovernmental revenues, and contributions. The changes in these fund balances
represent a policy change. Beginning in FY13, bond proceeds were deposited directly into the respective
capital improvement projects. Whereas, in prior years, the funds had been deposited and held in the Other
Construction Fund and then transferred to the capital improvement projects as expenditures were incurred.
This should help prevent having a deficit fund balance in the Bridge, Street, and Traffic Control Construction
Fund in fixture years. The remaining change in fund balance is due to timing of sale of GO bonds.
The fund balance for the Community Development Block Grant Fund was negative $8,000, representing a
$395,000 decrease in FY13 and revealing that liabilities in this fund were higher than assets. In FYll, the
City received program income that we were required to use prior to accessing new grant funding. This
VM
program income has now all been utilized and this fund will normally carry a minimal or zero fund balance
going forward.
The ending fund balance of the Other Shared Revenues and Grants fund was $2,633,000, a $2,034,000
increase. This increase is due to grant funds that were received in FY13 for reimbursement of prior period
expenditures.
The ending fund balance of the Debt Service Fund was $6,527,000, a decrease of $4,482,000. The City
utilized tax increment financing receipts from prior years to retire debt early. This resulted in a decrease in
reserves in equity in pooled cash and investments at the end of the fiscal year. The ending balance of
unrestricted equity in pooled cash and investments was $5,487,000, representing 28.7% of the total principal
and interest payments in FY 13 for GO debt.
The fund balance in the Employee Benefits Fund was stable from prior year. The ending fund balance was
$1,791,000, a decrease of $9,000 or 0.5% from FY12.
Proprietary Funds: The City's proprietary funds provide the same type of information found in the
government -wide financial statements, but in more detail.
The ending net position of the enterprise funds was $335,681,000, an increase in net position of $44,226,000.
This was primarily due to capital contributions of federal and state grants to fund capital improvement
projects to help with flood recovery and mitigation and transfer of business -type capital assets from
governmental capital project funds. Of the enterprise funds' net position, $253,617,000 is net investment in
capital assets. Unrestricted net position totaled $63,031,000, an increase of $4,220,000 compared to the
previous year due to an increase in capital contributions for funding of capital improvement projects that
otherwise would have had to be funded with cash from operating revenues.
The Internal Service funds showed net position totaling $31,650,000 as of June 30, 2013, an increase of
$3,737,000 primarily due to an operating income in the Loss Reserve Fund as claims were less than
anticipated and an operating income in the Equipment Reserve Fund to build up reserves for future capital
outlay.
Budgetary Highlights
The City presents budgetary information as allowed by GASB Statement No. 41. Budgets are based on nine
functional areas as required by state statute, not by fund or fund type.
The City had two budget amendments during the fiscal year. These amendments increased budgeted revenues
by $36,354,000 or 24.5% to a total of $184,741,000 and the expenditure budget by $99,344,000 or 58.5% to a
total of $269,279,000. These increases were due primarily to capital projects in governmental and business -
type funds because of timing of completion of projects and ongoing recovery from the flood of 2008 and the
associated grants.
Capital Assets and Debt Administration
Capital Assets: The City's investment in capital assets for its governmental and business -type activities as of
June 30, 2013 amounts to $499,827,000, net of accumulated depreciation. This investment in capital assets,
including land, buildings, improvements other than buildings, equipment, streets, bridges, trails, wastewater
and water systems, and other infrastructure represents the value of resources utilized to provide services to its
citizens. The City's investment in capital assets for the fiscal year ended June 30, 2013 increased by
$11,168,000 for governmental activities compared to the prior year and increased by $34,609,000 for
business -type activities over the prior year.
V44
The following table reflects the $499,827,000 investment in capital assets, net of accumulated depreciation.
City of Iowa City's Capital Assets
(net of depreciation)
(amounts expressed in thousands)
Major capital asset events during the current fiscal year included the following:
• Work continued on the South Wastewater Plant Expansion. This project will relocate the North
Wastewater Treatment Plant and consolidate operations into the South Wastewater Treatment Plant
through expansion of south plant facilities and demolition of the north plant facilities. Funding for
the project includes $22,003,000 in federal EDA grants, $13,610,000 in local options sales tax,
$5,495,000 in I -JOBS grant monies, $5,000,000 in CDBG Public Infrastructure grants, as well as,
$1,890,000 from Wastewater user fees and $7,000,000 in revenue bonds. The beginning construction
in progress balance was $5,717,000 and an additional $34,527,000 was moved into construction in
progress at the end of FY13 for a total of $40,244,000. This project is scheduled to be complete in
FY 14.
• Current construction projects at the municipal airport include rehabbing existing runways, adding a
parallel runway to improve safety, and obstruction mitigation. The construction in progress balance
at the end of FY13 was $4,153,000. These costs are primarily funded through federal or state grants,
with the remainder of funding from GO bonds.
• Completion of a water main replacement on Muscatine Avenue. Project costs were $819,000 and
were funded through Water Operations.
• Progress continues on the parking facility and enforcement automation project that includes
upgrading parking meters on the streets to allow credit card payments and pay -by -cell options and
add additional pay on foot and pay in lane equipment. Expenses capitalized in FY13 were $804,000.
The project is scheduled to be completed in FY14 with additional costs of $1,531,000 funded through
parking operations.
• Reconstruction of a landfill cell that was damaged by a fire in FY12 was started. $993,000 was
moved into construction in progress at the end of FY13. Total project costs are $4,000,000 and will
be funded through landfill operations.
• Expenses for a variety of street and bridge construction were moved into construction in progress at
the end of FY13 for a total balance of $12,427,000. This includes projects from the City's major
initiative for economic development with balances of $3,046,000 for Lower Muscatine from
Kirkwood to First Avenue and $4,455,000 for Sycamore Street from Highway 6 to City Limits.
Additional construction in progress includes $2,449,000 for the Iowa City Gateway Project, which
will reconstruct and elevate Dubuque Street and Park Road Bridge to provide flood protection.
Additional information on the City's capital assets can be found in Note 5 to the financial statements.
BIO
Governmental
Business -type
Activities
Activities
Total
2012
2012
2012
2013
(as restated)
2013
(as restated)
2013
(as restated)
Land
$ 22,782
$ 22,334
$ 28,496
$ 28,516
$ 51,278
$ 50,850
Buildings
35,065
35,520
80,280
83,171
115,345
118,691
Improvements other than
buildings
4,120
4,103
5,686
6,114
9,806
10,217
Machinery and equipment
14,203
13,678
11,545
10,743
25,748
24,421
Infrastructure
82,815
82,642
139,960
138,282
222,775
220,924
Construction in progress
23,278
12,818
51,597
16,129
74,875
28,947
Total
$ 182,263
$ 171,095
$ 317,564
$ 282,955
$ 499,827
$ 454,050
Major capital asset events during the current fiscal year included the following:
• Work continued on the South Wastewater Plant Expansion. This project will relocate the North
Wastewater Treatment Plant and consolidate operations into the South Wastewater Treatment Plant
through expansion of south plant facilities and demolition of the north plant facilities. Funding for
the project includes $22,003,000 in federal EDA grants, $13,610,000 in local options sales tax,
$5,495,000 in I -JOBS grant monies, $5,000,000 in CDBG Public Infrastructure grants, as well as,
$1,890,000 from Wastewater user fees and $7,000,000 in revenue bonds. The beginning construction
in progress balance was $5,717,000 and an additional $34,527,000 was moved into construction in
progress at the end of FY13 for a total of $40,244,000. This project is scheduled to be complete in
FY 14.
• Current construction projects at the municipal airport include rehabbing existing runways, adding a
parallel runway to improve safety, and obstruction mitigation. The construction in progress balance
at the end of FY13 was $4,153,000. These costs are primarily funded through federal or state grants,
with the remainder of funding from GO bonds.
• Completion of a water main replacement on Muscatine Avenue. Project costs were $819,000 and
were funded through Water Operations.
• Progress continues on the parking facility and enforcement automation project that includes
upgrading parking meters on the streets to allow credit card payments and pay -by -cell options and
add additional pay on foot and pay in lane equipment. Expenses capitalized in FY13 were $804,000.
The project is scheduled to be completed in FY14 with additional costs of $1,531,000 funded through
parking operations.
• Reconstruction of a landfill cell that was damaged by a fire in FY12 was started. $993,000 was
moved into construction in progress at the end of FY13. Total project costs are $4,000,000 and will
be funded through landfill operations.
• Expenses for a variety of street and bridge construction were moved into construction in progress at
the end of FY13 for a total balance of $12,427,000. This includes projects from the City's major
initiative for economic development with balances of $3,046,000 for Lower Muscatine from
Kirkwood to First Avenue and $4,455,000 for Sycamore Street from Highway 6 to City Limits.
Additional construction in progress includes $2,449,000 for the Iowa City Gateway Project, which
will reconstruct and elevate Dubuque Street and Park Road Bridge to provide flood protection.
Additional information on the City's capital assets can be found in Note 5 to the financial statements.
BIO
Debt Administration: At the end of the fiscal year, the City had total bonded debt outstanding of
$123,165,000. Of this amount, $58,550,000 comprises debt backed by the full faith and credit of the City.
However, $1,190,000 or 2.0% of the general obligation bonds is debt that serves enterprise funds and is
abated by their charges for services and $3,449,000 or 5.9% of these bonds is debt that will be paid with Tax
Increment Financing revenues. $64,615,000 represents revenue bonds secured solely by specific revenue
sources.
City of Iowa City's Outstanding Debt
General Obligation and Revenue Bonds
(amounts expressed in thousands)
Governmental
Business -type
Activities Activities Total
2013 2012 2013 2012 2013 2012
General obligation bonds $ 57,360 $ 73,825 $ 1,190 $ 1,495 $ 58,550 $ 75,320
Revenue bonds 2,655 - 61,960 68,185 64,615 68,185
Total $ 60,015 $ 73,825 $ 63,150 $ 69,680 $ 123,165 $ 143,505
The City issued $2,655,000 General Obligation bonds during FY13 and during the current fiscal year the
City's total bonded debt still decreased by $20,340,000 through retirement of debt.
The City continues to have the same excellent bond rating on its General Obligation bonds that it has had
for the past several years. This rating is given to those bonds judged to be of the best quality and carrying
the smallest degree of investment risks. The City's bond ratings by Moody's Investors Services, Inc. as of
June 30, 2013 were as follows:
General obligation bonds
Aaa
Parking revenue bonds
A
Wastewater treatment revenue bonds
A
Water revenue bonds
A
The City continues to operate well under the State debt capacity debt limitations. State statute limits the
amount of General Obligation Debt outstanding to 5% of the assessed value of all taxable property in Iowa
City. The current debt limitation for the City is $230,776,000. With outstanding General Obligation Debt
applicable to this limit of $58,550,000 we are utilizing 25.4% of this limit.
More detailed information on debt administration is provided in Note 6 of the financial statements.
Economic Factors and Next Year's Budget and Rates
In May 2009, the voters of Iowa City approved a one cent local option sales tax. Collection of this tax
began July 1, 2009 and continued for four years ending as of June 30, 2013. In FY13, the City collected
$8,858,000 in local option sales tax. The City Council has indicated that the priorities for use of this sales
tax will be capital projects for the elevation of Dubuque Street, including the reconstruction of Park Road
Bridge, and the expansion of the South Wastewater Plant and demolition of the North Wastewater Plant.
Sales tax proceeds are used to provide local match for available state and federal funding and to reduce
our reliance on property tax and increased user fees that would otherwise be needed to fund such projects.
During the 2009 session, the Iowa State Legislature passed a law allowing cities to utilize franchise fee
tax as a revenue alternative to property tax. The Iowa City Council passed a local franchise fee tax of 1%
on natural gas and electricity that became effective April 1, 2010. This revenue is being utilized to
support additional public safety initiatives, including operating a fourth fire station. In FY13, the City
collected $918,000 in local franchise fee.
31
The City expects continued constraints by the State's property tax formula. During the last legislative
session, the State passed properly tax reform, which will negatively affect the City's general operating
funds. Without the potential for new revenue sources, like those mentioned above, the City's
opportunities for new initiatives are limited. The Council has established a balanced budget in the
General Fund for FY14 that strives to maintain current service delivery levels. The tax levy rate per
$1,000 of assessed valuation for FY14 is provided below:
General Levy $ 8.100
Debt Service Levy 4.030
Employee Benefits Levy 3.163
Transit Levy 0.950
Liability Insurance Levy 0.292
Library Levy 0.270
Emergency Levy -
Total City Levy $ 16.805
Requests for Information
This report is designed to provide a general overview of the City of Iowa City's finances for all of those
with an interest in the government's finances. Questions concerning any of the information provided in
this report, or requests for additional financial information should be addressed to City of Iowa City,
Finance Department, 410 East Washington Street, Iowa City, IA, 52240.
16314
16M
CITY OF IOWA CITY, IOWA
STATEMENT OF NET POSITION
June 30, 2013
(amounts expressed in thousands)
Assets
Equity in pooled cash and investments
Receivables:
Property tax
Accounts and unbilled usage
Interest
Notes
Internal balances
Due from other governments
Inventories
Assets held for resale
Restricted assets:
Equity in pooled cash and investments
Other post employment benefits asset
Capital assets:
Land and construction in progress
Other capital assets (net of accumulated depreciation)
Total assets
Liabilities
Accounts payable
Contracts payable
Accrued liabilities
Interest payable
Deposits
Due to other governments
Notes payable
Unearned revenue
Noncurrent liabilities:
Due within one year:
Employee vested benefits
Bonds payable
Due in more than one year:
Employee vested benefits
Other post employment benefits obligation
Notes payable
Bonds payable
Landfill closure/post- closure liability
Total liabilities
Governmental Business -type
Activities Activities Total
$ 63,252 $
49,054 $
112,306
50,808
-
50,808
1,448
3,762
5,210
69
531
600
17,105
956
18,061
(11,321)
11,321
-
9,796
8,466
18,262
659
653
1,312
703
-
703
29,601
36,157
65,758
24
7
31
46,058
136,205
80,092
237,472
126,150
373,677
344,407
428,471
772,878
3,287
1,603
4,890
2,689
4,840
7,529
2,942
298
3,240
156
1,231
1,387
1,021
760
1,781
18
115
133
538
-
538
61,144
556
61,700
1,161
428
1,589
10,347
5,492
15,839
950
317
1,267
2,386
951
3,337
211
-
211
49,957
58,455
108,412
-
6,405
6,405
136,807
81,451
218,258
(continued)
34
CITY OF IOWA CITY, IOWA
STATEMENT OF NET POSITION (continued)
Net position
Net investment in capital assets
Restricted for or by:
Employee benefits
Capital projects
Debt service
Other purposes
Bond ordinance
State statute
Future improvements
Grant agreement
Unrestricted
Total net position
June 30, 2013
(amounts expressed in thousands)
Governmental Business -type
Activities Activities Total
$ 133,989 $ 253,617 $ 387,606
2,073
-
2,073
13,319
-
13,319
6,527
-
6,527
948
-
948
-
14,525
14,525
-
1,170
1,170
-
234
234
-
3,104
3,104
50,744
74,370
125,114
$ 207,600 $ 347,020 $ 554,620
The notes to the. financial statements are an integral part of this statement.
611
Fractions/Programs: Expenses
Governmental activities:
CITY OF IOWA CITY, IOWA
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Program Revenues
20,989 $
Operating
Capital
Charges Grants and
Grants and
for Services Contributions
Contributions
Public safety $
20,989 $
4,098 $
365 $
30
Public works
10,240
52
297
5,056
Culture and recreation
14,481
775
-
1,441
Community and economic development
10,596
-
4,069
349
General government
7,513
2,763
-
-
Interest on long -term debt
2,237
-
-
-
Total governmental activities
66,056
7,688
4,731
6,876
Business -type activities:
Wastewater treatment
10,464
12,832
-
30,181
Water
9,074
8,583
442
494
Sanitation
7,279
8,181
23
-
Housing authority
7,658
205
6,968
-
Parking
4,579
5,043
-
-
Airport
1,086
314
11
2,452
Stormwater
1,318
974
13
226
Cable television
692
816
-
-
Transit
6,998
2,117
1,767
898
Total business -type activities
49,148
39,065
9,224
34,251
Total
$ 115,204 $
46,753 $
13,955 $
41,127
General revenues:
Property taxes, levied for general purposes
Road use tax
Hotel /motel tax
Gas and electric tax
Local option sales tax
Utility franchise tax
Earnings on investments
Gain on disposal of capital assets
Miscellaneous
Transfers
Total general revenues, transfers, and extraordinary items
Changes in net position
Net position beginning of year, as restated
Net position end of year
The mites to the fimmaial. statements are an integral part of this statement.
1618
Net (Expense) Revenue and
Changes in Net Position
Govemmental Business -type
Activities Activities Total
$ (16,496) $
- $ (16,496)
(4,835)
- (4,835)
(12,265)
- (12,265)
(6,178)
- (6,178)
(4,750)
- (4,750)
(2,237)
- (2,237)
(46,761)
- (46,761)
- 32,549
32,549
- 445
445
- 925
925
- (485)
(485)
- 464
464
- 1,691
1,691
- (105)
(105)
- 124
124
- (2,216)
(2,216)
- 33,392
33,392
(46,761) 33,392
(13,369)
51,017
-
51,017
6,589
-
6,589
872
-
872
819
-
819
8,858
-
8,858
918
-
918
841
671
1,512
1,312
293
1,605
4,390
918
5,308
(10,485)
10,485
-
65,131
12,367
77,498
18,370
45,759
64,129
189,230
301,261
490,491
$ 207,600 $
347,020
$ 554,620
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CITY OF IOWA CITY
RECONCILIATION OF THE BALANCE SHEET OF THE
GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION
June 30, 2013
(amounts expressed in thousands)
Total governmental fund balances $ 66,879
Amounts reported for governmental activities in the statement
of net position are different because:
Internal service funds are used by management to charge the costs
of certain activities to individual funds. The assets and liabilities
of the internal service funds are included in governmental
activities in the statement of net position. 31,650
Other long -term assets are not available to pay for current period
expenditures and therefore are deferred in the funds:
Notes, grants and other receivables - Earned but unavailable 10,821
Capital assets used in governmental activities are not current
financial resources and therefore are not reported in the funds. 174,564
Accrued compensated absences are not due and payable in the
current period and therefore are not reported in the funds. (1,998)
Accrued post employment benefit obligations are not due and
payable in the current period and therefore are not reported
in the funds. (2,311)
Bonds payable are not due and payable in the current period
and therefore are not reported in the funds. (60,304)
Notes payable are not due and payable in the current period
and therefore are not reported in the funds. (211)
Accrued interest on bonds (151)
Internal balance due to integration of internal service funds (11,339)
Total net position of governmental activities $ 207,600
The notes to the financial statements are an integral part of this statement.
CUl
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CITY OF IOWA CITY
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Net change in fund balances - total governmental funds
Amounts reported for governmental activities in the statement of activities
are different because:
Governmental funds report capital outlays as expenditures while governmental
activities report depreciation expense to allocate those expenditures over the
life of the asset. Capital outlays and contributed capital assets exceeded
depreciation expense in the current year as follows:
Expenditures for capital assets
Transfers of capital assets (to)\from enterprise funds - net
Transfers of capital assets (to)\from internal service funds - net
Capital assets contributed
Depreciation expense
Bond proceeds are reported as other financing sources in governmental funds
and thus contribute to the change in fund balance. In the statement of net
position, however, issuing debt increases long -term liabilities and does not affect
the statement of activities. Similarly, repayment of principal is an expenditure in
the governmental funds but reduces the liability in the statement of net position.
Debt issued
Discount / (premium) on bonds issued
Repayments of debt
Amortization of premium
Because some revenues will not be collected for several months after the
City's year end, they are not considered available revenues and are deferred
in the governmental funds.
Some expenses reported in the statement of activities do not require the
use of current financial resources and therefore are not reported as
expenditures in governmental funds:
Change in accrued compensated absences
Change in accrued post employment benefit obligations
Change in accrued interest on debt
In the statement of activities, only the gain on the sale of the capital assets is
recognized, whereas in the governmental funds, the proceeds from the sale
increased financial resources. Thus, the change in net position differs from the
change in fund balance by the cost of the capital asset sold.
Internal service funds are used by management to charge the costs
of certain activities to individual funds. The net revenue of certain activities of
internal service funds is reported with governmental activities.
Change in net position of governmental activities
The notes to the financial statements are an integral part of this statement.
44
$ 16,030
(660)
(1)
498
(5,592)
(2,655)
42
16,465
70
(7,519)
10,275
13,922
52
(83)
(456)
32
(57)
2,204
$ 18,370
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CITY OF IOWA CITY
STATEMENT OF FIDUCIARY
ASSETS AND LIABILITIES
June 30, 2013
(amounts expressed in thousands)
Assets
Equity in pooled cash and investments
Total assets
Liabilities
Accounts payable
Due to agency
Total liabilities
Agency
Funds
$ 145
$ 145
139
$ 145
The notes to the. financial statements are an integral part of this statement.
69J
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS
June 30, 2013
1. Accounting Policies
The City of Iowa City, Iowa, (the City) was incorporated April 6, 1853, and operates under the
Council/Manager form of government. The City provides a broad range of services to its citizens
including general government, public safety, streets, parks, and cultural facilities. It also operates an
airport, a mass transportation system, parking facilities, water treatment, wastewater treatment, storm
water collection, sanitation collection and disposal (including landfill operations), cable television, and a
housing authority.
The financial statements of the City have been prepared in conformity with accounting principles
generally accepted in the United States of America (GAAP) as applied to governmental units. The
Governmental Accounting Standards Board (GASB) is the accepted standard - setting body for
establishing governmental accounting and financial reporting principles. The more significant accounting
policies of the City are described below.
The Reporting Entity
For financial reporting purposes, the City includes all of its funds, organizations, agencies, boards,
commissions, and authorities. The City has also considered all potential component units for which it is
financially accountable, and other organizations for which the nature and significance of their relationship
with the City are such that exclusion would cause the City's financial statements to be misleading or
incomplete. The Governmental Accounting Standards Board has set forth criteria to be considered in
determining financial accountability. These criteria include appointing a voting majority of an
organization's governing body, and (1) the ability of the City to impose its will on that organization or (2)
the potential for the organization to provide specific benefits to, or impose specific financial burdens on
the City. There were no component units required to be included.
Government -Wide and Fund Financial Statements
The government -wide financial statements (i.e., the Statement of Net position and the Statement of
Activities) report information on all of the non - fiduciary activities of the primary government.
Governmental activities, which normally are supported by taxes and intergovernmental revenues, are
reported separately from business -type activities, which rely to a significant extent on fees and charges for
support.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Program revenues include 1) charges to customers or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided by a given function or
segment and 2) grants and contributions that are restricted to meeting the operational or capital
requirements of a particular function or segment. Taxes and other items not properly included among
program revenues are reported as general revenues.
As a general rule, the effect of inter -fund activity has been eliminated from the government -wide financial
statements. Exceptions to this general rule are charges between the City's water and sewer function and
various other functions of the government. Eliminations of these charges would distort the direct costs
and program revenues reported for the various functions concerned.
I-V
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Separate financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statements.
Description of Funds
These financial statements include all funds owned or administered by the City or for which the City acts
as custodian.
The City maintains its records on a modified cash basis of accounting under which only cash receipts,
cash disbursements and encumbrances, investments, and bonded debt are recorded. These modified cash
basis accounting records have been adjusted to the accrual or modified accrual basis, as necessary, to
prepare the accompanying financial statements in accordance with GAAP.
The accounts of the City are organized on the basis of funds, each of which is considered to be a separate
accounting entity. The fund categories are governmental, proprietary, and fiduciary. Each fund is
accounted for by providing a separate set of self - balancing accounts that comprise its assets, liabilities,
net position, revenues, and expenditures or expenses, as appropriate. The individual funds account for the
governmental resources allocated to them for the purpose of carrying on specific activities in accordance
with laws, regulations, or other restrictions.
Basis of Accounting
The accounting and financial reporting treatment applied to a fund is determined by its "measurement
focus." The government -wide financial statements and proprietary funds are accounted for on the flow of
economic resources measurement focus and use the accrual basis of accounting. Agency funds do not
have a measurement focus and use the accrual basis of accounting. Under the accrual method, revenues
are recorded when earned and expenses are recorded at the time liabilities are incurred.
All governmental funds are accounted for using a current financial resources measurement focus, which
generally includes only current assets and current liabilities on the balance sheet. The modified accrual
basis of accounting is used for these funds. Under the modified accrual basis, revenue is recognized when
susceptible to accrual, which is in the period in which it becomes both available (collectible within the
current period or soon thereafter to be used to pay liabilities of the current period) and measurable (the
amount of the transaction can be determined). Revenue accrued includes property taxes,
intergovernmental revenue, and interest earned on investments (if they are collected within 60 days after
the year -end). Expenditures are recorded when the related fund liability is incurred. Principal and interest
on long -term debt, as well as expenditures related to compensated absences and claims and judgments,
are recorded only when payment is due.
The City reports the following major governmental funds
The General Fund is the City's primary operating fund. It accounts for all financial resources of
the general government, except those required to be accounted for in another fund.
54
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The Employee Benefits Fund is used to account for the employee benefits related to those
employees who are paid through governmental fund types, which are funded by a separate
property tax levy.
The Community Development Block Grant Fund accounts for revenue from the U.S. Department
of Housing and Urban Development's Community Development Block Grant programs.
The Other Shared Revenue and Grants Fund accounts for revenue from various sources,
primarily road use tax monies from the State of Iowa and reimbursable programs funded by
federal and state grants.
The Other Construction Fund accounts for the construction or replacement of other City general fixed
assets, such as administrative buildings with various funding sources, including general obligation
bonds, intergovernmental revenues, and contributions.
The Debt Service Fund accounts for the accumulation of resources for the payment of general
long -term debt principal, interest, and related costs.
The City reports the following major proprietary funds
The Parking Fund is used to account for the operation and maintenance of the "on" and "off'
street public parking facilities.
The Wastewater Treatment Fund is used to account for the operation and maintenance of the
wastewater treatment facility and sanitary sewer system.
The Water Fund is used to account for the operation and maintenance of the water system.
The Sanitation Fund is used to account for the operation and maintenance of the solid waste
collection system and landfill.
The Housing Authority Fund is used to account for the operations and activities of the City's low
and moderate income housing assistance and public housing programs.
The Transit Fund is used to account for the operation and maintenance of the public
transportation system.
Additionally, the City reports internal service funds to account for goods and services provided by one
department to other City departments on a cost reimbursement basis. The funds in this category are the
Equipment Maintenance Fund, Central Services Fund, Loss Reserve Fund, and the Information
Technology Fund.
6Y..1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The City also reports fiduciary funds which are used to account for resources held for the benefit of
parties outside the government. Fiduciary funds are not reflected in the government -wide financial
statements because the resources of those funds are not available to support the City's own programs. The
accounting used for fiduciary funds is much like that used for proprietary funds. The City has two
fiduciary funds which are maintained as agency funds, with no attempt to create an ongoing fund balance.
The funds in this category are Project Green, which accounts for donations that are received to plant and
develop yards and lawns, both public and private, within Iowa City, and the Library Foundation, which
accounts for donations that are made to support the library development office.
Proprietary funds distinguish operating revenues and expenses from non - operating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. The principal operating revenues of
the City's enterprise funds and of the City's internal service funds are charges to customers for sales and
services. Operating expenses for enterprise funds and internal service funds include the cost of sales and
services, administrative expenses, and depreciation on capital assets. All revenues and expenses not
meeting this definition are reported as non - operating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the government's policy to use
restricted resources first, then unrestricted resources as they are needed.
Uses of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue, expenditures and expenses, as appropriate,
during the reporting period. Actual results could differ from these estimates. Material estimates that are
particularly susceptible to significant change in the near -term relate to the determination of landfill
closure and post - closure care costs, total capacity of the landfill at closure, and calculation of the costs of
claims incurred, but not reported.
Cash and Investments
The City maintains one primary demand deposit account through which the majority of its cash resources
are processed. Substantially all investment activity is carried on by the City in an investment pool, except
for those funds required to maintain their investments separately. The earnings on the pooled investments
are allocated to the funds on a systematic basis. All investments are stated at fair value except for the
Iowa Public Agency Investment Trust (IPAIT) which is valued at amortized cost pursuant to Rule 2a -7
under the Investment Company Act of 1940.
For the purpose of the Statement of Cash Flows, restricted and non - restricted investments with a maturity
of three months or less when purchased are considered cash equivalents.
tity
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Receivables and Revenue Recognition
Property tax receivable is recognized in governmental funds on the levy or lien date, which is the date that
the tax asking is certified by the City to the County Board of Supervisors. Current year delinquent
property tax receivable represents unpaid taxes from the current year. The succeeding year property tax
receivable represents taxes certified by the City to be collected in the next fiscal year for the purposes set
out in the budget for the next fiscal year. By statute, the City is required to certify its budget to the County
Auditor by March 15 of each year for the subsequent fiscal year. However, by statute, the tax asking and
budget certification for the following fiscal year becomes effective on the first day of that year. Although
the succeeding year property tax receivable has been recorded, the related revenue is deferred in both the
government -wide and fund financial statements and will not be recognized as revenue until the year for
which it is levied.
Federal and state grants are recorded as receivables and the revenue is recognized during the period in
which the City fulfills the requirements for receiving the grant awards, as long as the susceptible to
accrual criteria are met.
Income from investments in all fund types and from charges for services in proprietary fund types is
recognized when earned. Licenses and permits, fines and forfeitures, fees and refunds, charges for
services (in governmental fund types), miscellaneous, and other revenues are recorded as revenue when
received in cash because they are generally not measurable until actually received.
Inventories
Inventories are recognized only in those funds in which they are material to the extent of affecting
operations. For the City, these are the Transit Fund, Water Fund, and the Equipment Maintenance Fund.
Inventories of materials and supplies in the enterprise funds are determined by actual count and priced on
the FIFO method.
Capital Assets
Capital assets, which include property, buildings, equipment, and infrastructure assets (e.g., roads,
bridges, water mains, and similar items), are reported in the applicable governmental or business -type
activities columns in the government -wide financial statements. The City follows the policy of not
requiring capitalization of an asset with an initial, individual cost of less than $50,000 for infrastructure,
$25,000 for buildings and improvements, and $5,000 for equipment assets. Such assets are recorded at
original purchase cost or at fair value at the date of donation when received as donated properties.
Depreciation is computed using the straight -line method over the following estimated useful lives:
Infrastructure 3 — 100 years
Buildings and structures 20 — 50 years
Improvements other than buildings 10 — 50 years
Vehicles 2 — 20 years
Other equipment 5 — 30 years
611
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Bond Premiums and Discounts
Debt issued at a premium or discount is recorded net of the unamortized premium or discount. In the
governmental funds, premiums and discounts are recorded entirely as other financing sources or uses in
the year of issuance. In the proprietary funds and the government -wide statements, they are amortized
over the life of the bonds.
Compensated Absences
Permanent City employees accumulate vacation and sick leave hours for subsequent use or for payment
upon death, resignation, or retirement. The City pays its employees (except firefighters) one -half of the
accumulated sick leave at the time of termination on the basis of the employee's then effective hourly
base salary, provided that the dollar amount of the payment may be up to, but not exceed, the amount that
an employee would be paid if the employee had terminated on June 28, 1985. Employees hired on or after
June 29, 1985, are not eligible for payment of accumulated sick leave upon termination, death, or
retirement.
Pensions
The provision for pension cost is recorded on the accrual basis (based on statutorily determined
contribution rates), and the City's policy is to fund pension costs as they accrue.
Landfill Closing Costs
Costs expected to be incurred in ultimately closing the present landfill site are being systematically
provided for through charges to expense over the estimated useful life of the landfill on the basis of
capacity used (see Note 7).
Budgetary and Legal Appropriation and Amendment Policies
The City prepares and adopts an annual function budget, as prescribed by Iowa statutes, for all funds
except internal service and agency funds. This is formalized in a separate budgetary report, the Financial
Plan. This budget is adopted on or before March 15 of each year to become effective July 1, and
constitutes the City's appropriation for each program and purpose specified therein until amended. The
adopted budget must include the following:
a. Expenditures for each function:
Public safety
Public works
Health and social services
Culture and recreation
Community and economic development
General government
Debt service
Capital projects
Business- type /enterprise
b. The amount to be raised by property taxation
c. Income from sources other than property taxation
d. Transfers in and transfers out
6Y:7
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The legal level of control (the level at which expenditures may not legally exceed appropriations) is the
function level for all funds combined, rather than at the individual fund level. Management can transfer
appropriations within a function, within a fund type, and between fund types, without the approval of the
governing body so long as the total budget by function area will not be exceeded. It is necessary,
therefore, to aggregate the expenditures of the budgeted activities within the governmental fund types
with the expenditures of the budgeted activities within the enterprise funds on a function basis, and to
compare such function totals to function budgeted totals in order to demonstrate legal compliance with
the budget. The City's budget for revenue focuses on the individual fund revenue rather than on
aggregated fund totals.
The City formally adopts budgets for several funds that are not required by state law to be included in the
annual function budget. Annual operating budgets are adopted for the internal service funds for
management control purposes. Such budgets, however, are not legally required to be adopted under state
statutes. These budgets are adopted and amended at the same time and in the same manner as the City's
annual function budget.
A City budget for the current fiscal year may be amended for any of the following purposes as prescribed
by Iowa statute:
a. To permit the appropriation and expenditure of unexpended, unencumbered cash balances on
hand at the end of the preceding fiscal year.
b. To permit the appropriation and expenditure of amounts anticipated being available from sources
other than property taxation.
c. To permit transfers between funds.
d. To permit transfers between programs.
A budget amendment must be prepared and adopted in the same manner as the original budget. The City's
budget was amended as prescribed, and the effects of those amendments are shown in the accompanying
budgetary comparison schedule. The original budget was increased by $88,101,593 in revenues and other
financing sources and by $147,434,594 in expenditures and other financing uses. Appropriations, as
adopted or amended, lapse at the end of the fiscal year.
As allowed by GASB Statement No. 41, Budgetary Comparison Schedules — Perspective Differences, the
City presents budgetary comparison schedules as required supplementary information based on the
program structure of nine functional areas as required by state statute for its legally adopted budget.
Restricted Assets
Assets within the individual funds, which can be designated by the City Council for any use within the
fund's purpose, are considered to be unrestricted assets. Assets, which are restricted for specific uses by
bonded debt requirements, grant provisions, or other requirements, are classified as restricted assets.
Liabilities, which are payable from restricted assets, are classified as such.
Classification of Fund Balances
Fund balances for the governmental funds are reported in classifications based on the nature of any
limitations requiring the use of resources for specific purposes (see Note 9).
6T9
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
2. Compliance and Accountability
At June 30, 2013 the Community Development Block Grant Fund reported a deficit balance of $8,000.
The deficit is due to deferred revenue from the Department of Housing and Urban Development (HUD).
The City anticipates receiving these funds from HUD.
3. Cash and Pooled Investments
The City's deposits in banks at June 30, 2013 were entirely covered by federal depository insurance,
national credit union administration, or by the State Sinking Fund in accordance with Chapter 12C of the
Code of Iowa. This chapter provides for additional assessments against the depositories to insure there
will be no loss of public funds.
The City is authorized by statute to invest public funds in obligations of the United States government, its
agencies and instrumentalities; certificates of deposit or other evidences of deposit at federally insured
Iowa depository institutions approved by City Council and secured pursuant to the limitations set forth in
Chapter 12C of the Code of Iowa; prime eligible bankers acceptances; certain high rated commercial
paper; perfected repurchase agreements; Iowa Public Agency Investment Trust ( IPAIT); certain registered
open —end management investment companies registered with the Securities & Exchange Commission
under the federal Investment Company Act of 1940; certain joint investment trusts; and warrants or
improvement certificates of a drainage district.
Investments are stated at fair value. In addition, the City had investments in the Iowa Public Agency
Investment Trust, which are valued at an amortized cost of $16,324,851 pursuant to Rule 2a -7 under the
Investment Company Act of 1940.
Interest rate risk. The City's investment policy limits the investment of general and operating funds to
one year, unless a temporary extension of maturities is approved by the City Council. In such cases, the
average maturity of each fund's portfolio shall not exceed 397 days. Funds not identified as operating
funds may be invested in instruments whose maturities do not exceed five years at the time of purchase.
Credit risk. State law limits investments to commercial paper and corporate bonds to the top two ratings
issued by nationally recognized statistical rating organizations. It is the City's policy to comply with
rating restrictions. The investment in Iowa Public Agency Investment Trust is not rated by Moody's
Investors service as it is a state security that is backed by the full faith and credit of the issuing
government and is not subject to credit risk.
Concentration of credit risk. The City investment policy limits the amount that may be invested in any
one issuer to a maximum amount approved by the City Council.
The aforementioned Iowa Public Agency Investment Trust ( IPAIT) represents an investment in a pool
managed by others. IPAIT is a common trust established under Iowa law pursuant to Iowa Code Chapter
28E in 1987 to enable eligible Iowa public agencies to safely and effectively invest their available
operating and reserve funds. IPAIT is registered under the Investment Company Act of 1940.
The IPAIT portfolios have followed established money market mutual fund investment parameters
designed to maintain a $1 per unit net asset value since inception and were registered with the Securities
and Exchange Commission (SEC).
[xu
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Due to legal and budgetary reasons, the General Fund is assigned a portion of the investment earnings
associated with other funds. These funds are the employee benefits, other shared revenue, and sanitation
funds.
4. Interfund Balances and Transfers
Interfund balances for the year ended June 30, 2013, consisted of the following:
Interfund balances at June 30, 2013, include advances due to /from other funds. Advances to /from other
funds represent amounts for construction loans, land and negative cash balance funding. $828,789 of the
$859,658 advances to the Nonmajor Enterprise Funds and $86,039 of the $141,362 advance to the Transit
Fund are not expected to be repaid within the next year. The $148,113 of the advance to the Community
Development Block Grant Fund is expected to be repaid within the next year. $162,888 of the $174,769
advance to the Other Shared Revenue and Grants Fund is not expected to be repaid within the next year.
None of the $18,000 advance to Housing Authority is expected to be repaid within the next year.
1*1
Advances from
Community
Development
Debt
General
Block Grant
Service
Sanitation
Total
Advances to:
Community Development $ 148,113
$
$ - $
-
$ 148,113
Block Grant
Other Shared Revenue
and Grants -
174,769
-
174,769
Housing Authority
18,000
-
-
18,000
Transit
-
141,363
141,363
Nonmajor Enterprise
859,658
859,658
Total S t48.tt3
S 18.000
S t74.769 S
1.(101.021
S 1.341.903
Interfund balances at June 30, 2013, include advances due to /from other funds. Advances to /from other
funds represent amounts for construction loans, land and negative cash balance funding. $828,789 of the
$859,658 advances to the Nonmajor Enterprise Funds and $86,039 of the $141,362 advance to the Transit
Fund are not expected to be repaid within the next year. The $148,113 of the advance to the Community
Development Block Grant Fund is expected to be repaid within the next year. $162,888 of the $174,769
advance to the Other Shared Revenue and Grants Fund is not expected to be repaid within the next year.
None of the $18,000 advance to Housing Authority is expected to be repaid within the next year.
1*1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Interfund transfers for the year ended June 30, 2013, consisted of the following:
(continued)
Transfers are used to move revenues and bond proceeds from the fund that State statutes or the budget
requires to collect them to the fund that the State statutes or the budget requires to expend them.
In the fund financial statements, total transfers in and transfers out of $39,683,000 are less than total
transfers of $40,365,991 because of the treatment of transfers of capital assets to and from the
governmental activities capital assets.
During the year, construction in process related to general government with a value of $22,036 was
transferred to governmental activities capital assets from Information Technology. No amounts were
reported in the governmental funds, as the amounts did not involve the transfer of financial resources.
However, Information Technology did report a disposal for the capital resources given.
Also during the year, a capital asset related to public safety with a value of $3,160 was transferred from
governmental activities capital assets to Equipment. No amounts were reported in the governmental
funds, as the amounts did not involve the transfer of financial resources. However, Equipment did report
capital contributions for the capital resources received.
MA
Transfer from
Other
Capital
Community
Shared
projects
Employce
Development
Revenue and
Other
Nonmajor
General
Benctim
Block Grant
Grants
Construction
Governmental
parking
Transfer to:
General
$ -
$ 8,705,258
$ -
$ 122,242
$ 317,623
$ -
$ -
Debt service
266,650
-
-
-
19,436
-
-
Other shared revenue
and grants
12,758
425,659
-
-
-
-
-
Capital Projects
Other Construction
1,054,258
-
330,000
2
-
-
45,484
Nonmajor governmental
209,729
-
-
1,008,182
9,169,280
130,762
Wastewater treatment
7,116,491
-
-
12,263
138,805
54,636
-
Water
1,983
-
-
-
169,708
232,026
-
Housing Authority
-
-
4,787
-
-
-
-
Transit
2,754,940
-
-
-
-
-
156,267
Nonmajor enterprise
98,813
-
-
-
2,008,203
440,170
-
Internal Service
78,090
-
-
26,800
583,744
-
22,060
Total Transfer to
S 11,593,712
S 9,130,917
S 334,787
S 1.169.489
S 12,406,799
S 857,594
S 223,811
(continued)
Transfers are used to move revenues and bond proceeds from the fund that State statutes or the budget
requires to collect them to the fund that the State statutes or the budget requires to expend them.
In the fund financial statements, total transfers in and transfers out of $39,683,000 are less than total
transfers of $40,365,991 because of the treatment of transfers of capital assets to and from the
governmental activities capital assets.
During the year, construction in process related to general government with a value of $22,036 was
transferred to governmental activities capital assets from Information Technology. No amounts were
reported in the governmental funds, as the amounts did not involve the transfer of financial resources.
However, Information Technology did report a disposal for the capital resources given.
Also during the year, a capital asset related to public safety with a value of $3,160 was transferred from
governmental activities capital assets to Equipment. No amounts were reported in the governmental
funds, as the amounts did not involve the transfer of financial resources. However, Equipment did report
capital contributions for the capital resources received.
MA
Wastewater
Treatment
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Water
Transfer from
Sanitation
Housing Nonmajor Total
Authority Transit Enterprise Transfer from
$ 23,784 $ 49,812 $ - $ 43,000 $
606,414 - 8,836 3,736
711,346 1,406,165 20,020 -
224,000 - 56,000 -
- 25,000 70,755 -
S 1,565,544 $ 1,480,977 $ 155,611 S 46,736 S
Transfers from governmental activities capital assets to internal service funds
Transfers to governmental activities capital assets from internal service funds
Transfers from governmental activities capital assets to enterprise funds
$ 66,892 $ 9,328,611
286,086
438,417
6,072 4,620 2,059,422
- 429,428 13,084,912
- - 7,322,195
- 209,632 893,349
4,787
- - 2,911,207
- - 2,547,186
806,449
6,072 $ 710,572 39,682,621
23,499
22,036
659,871
S 40.365,991
During the year, construction in progress related to the installation of citywide video surveillance systems
with a value of $20,338 was transferred from governmental activities capital asset to Information
Technology. No amounts were reported in the governmental funds, as the amounts did not involve the
transfer of financial resources. However, Information Technology did report capital contributions for the
capital resources received.
Also during the year, construction in progress related to construction along 420" Street with a value of
$659,871 was transferred from governmental activities capital asset to Wastewater Treatment. No
amounts were reported in the governmental funds, as the amounts did not involve the transfer of financial
resources. However, Wastewater Treatment did report capital contributions for the capital resources
received.
Ml
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
5. Capital Assets
Capital asset activity for the year ended June 30, 2013, was as follows:
Beginning
Acquisitions
July 1, 2012
and
(as Restated)
Transfers
Governmental activities:
Capital assets, not being depreciated:
16,310,408
2,406,299
Land
$ 22,333,177
$ 448,224
Construction in progress
12,818,641
13,058,595
Total capital assets, not being depreciated
35,151,818
13,506,819
Capital assets, being depreciated:
1,252,285
26,502,149
Buildings
51,829,704
1,992,086
Improvements other than buildings
6,346,047
267,227
Machinery and equipment
38,271,825
3,661,920
Infrastructure
111,719,873
2,621,448
Total capital assets being depreciated
208,167,449
8,542,681
Less accumulated depreciation for
Disposals
and Balance
Transfers June 30, 2013
$ - $ 22,781,401
2,599,111 23,278,125
2,599,111 46,059,526
40,000 53,781,790
- 6,613,274
1,228,735 40,705,010
- 114,341,321
1,268,735 215,441,395
Buildings
16,310,408
2,406,299
-
18,716,707
Improvements other than buildings
2,242,817
250,153
-
2,492,970
Machinery and equipment
24,593,789
3,160,645
1,252,285
26,502,149
Infrastructure
29,078,366
2,479,611
31,139
31,526,838
Total accumulated depreciation
72,225,379
8,296,708
1,283,424
79,238,664
Total capital assets, being depreciated, net
135,942,070
245,973
(14,689)
136,202,731
Governmental activities capital assets, net
$ 171,093,888
$ 13,752,792
$ 2,584,422
$ 182,262,257
[It I
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Beginning
Acquisitions
July 1, 2012
and
(as Restated)
Transfers
Business -type activities:
Capital assets, not being depreciated
Disposals
and Balance
Transfers June 30, 2013
Land
$ 28 -516,095
$ -
$ 20,091
$ 28,496,004
Construction in progress
16,128,436
39286,700
3,818,292
51 -596,844
Total capital assets, not being depreciated
44,644,531
39286,700
3,838,383
80,092,848
Capital assets, being depreciated:
262541
Internal service funds
Buikhngs
141312,033
756,077
192 -546
141,875,564
Improvements other than buildings
10 -559,851
16,131
-
10 -575,982
Machinery and equipment
31,027,767
2,241,488
27322
33,241,933
Infrastructure
205,637,129
6,175,769
-
211,812,898
Total capital assets being depreciated
388,536,780
9,189,465
219,868
397 -506,377
Less accumulated depreciation for:
1535,015
Total depreciation expense - business -type activities
$
Buikhngs
58,140,040
3,606,058
150964
61 -595,134
Improvements other than buildings
4,445,983
444267
-
4,890,250
Machinery and equipment
20284,611
1,439,648
27322
21,696,937
Infrastructure
67355271
4,497,448
-
71,852,719
Total accumulated depreciation
150225,905
9,987,421
178286
160,035,040
Total capital assets, being depreciated, net
238,310,875
(797956)
41 -582
237,471,337
Business -type activities capital assets, net
$ 282,955,406
$ 38,488,744
$ 3,879,965
$ 317,564,185
Depreciation expense was charged to functions as follows:
Governmental activities:
Public safety
$
951,071
Public works
2299,439
Culture and recreation
2,039,376
Community and economic development
39577
General government
262541
Internal service funds
1537,172
Total depreciation expense - governmental activities
$
7,129,177
Business -type activities:
Parking
$
786,683
Transit
$
1,040,925
Wastewater treatment
3912,369
Water
2,168,711
Sanitation
415,434
Housing authority
128284
Nonmajor enterprise
1535,015
Total depreciation expense - business -type activities
$
9987,421
mi
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
6. Long Term Debt
Changes in Debt for Bonds
Bond debt activity for the year ended June 30, 2013, was as follows:
July 1, 2012
Governmental activiLies:
Issues
Retirements June 30, 2013
Due Within
n..a V--
General obligation bonds
$ 73,825,000
$ - $
16,465,000
$ 57,360,000
$
10,275,000
Plus: Unamortized
Premium
400,654
-
71,851
328,803
74,104
Total general obligation bonds
74225,654
-
16 -536,851
57,688,803
10349,104
Revenue bonds
-
2,655,000
-
2,655,000
-
Less: Unamortized
Discounts
-
42,480
2,124
40,356
2,124
Total revenue bonds
-
2,612 -520
(1124)
2,614,644
(2,124)
$ 74,225,654
$ 2,612,520 $
16,534,727
$ 60,303,447
$
10,346,980
Business -type activities:
General obligation bonds
$ 1,495,000
$ - $
305,000
$ 1,190,000
$
300,000
Less: Unamortized
Discounts
11 -527
-
3,842
7,685
3,842
Total general obligation bonds
1,483,473
-
301,158
1,182315
296,158
Revenue bonds
68,185,000
-
6225,000
61960,000
5,115,000
Plus: Unamortized
Premium
874,307
-
69 -569
804,738
81221
Total revenue bond~
69,059307
-
6294 -569
62,764,738
5,196,221
$ 70542,780
$ - $
6 -595,727
$ 63,947,053
$
5,492379
General Obligation Bonds
Various issues of general obligation bonds totaling $58,550,000 are outstanding as of June 30, 2013. The
bonds have interest rates ranging from 0.5% to 5.6% and mature in varying annual amounts ranging from
$105,000 to $1,545,000 per issue, with the final maturities due in the year ending June 30, 2022. Interest
and principal payments on all general obligation bonds, except tax abated portions recorded in the
enterprise funds, are accounted for through the Debt Service Fund.
Portions of several general obligation bond issues have been used to acquire or expand the enterprise fund
facilities. In some instances, revenue generated by the enterprise funds is used to pay the general long-
term debt principal and interest. The liability for those bonds that are expected to be paid by enterprise
funds is included in those funds.
1x.1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
As of June 30, 2013, the City of Iowa City was authorized to issue general obligation bonds totaling
$7,750,000 that had not been issued.
Annual debt service requirements to maturity for general obligation bonds are as follows:
Fiscal Year Ending
June 30
Governmental Activities Business -type Activities
Principal Interest Principal Interest
2014
10,275,000
1,733,030
300,000
44,325
2015
10,135,000
1,429,063
300,000
33,225
2016
9,575,000
1,119,055
295,000
22,125
2017
7,975,000
822,825
295,000
11,062
2018
7,120,000
586,544
-
-
2019 -2023
12,280,000
708,356
$
-
$
2,205,000
Total
$ 57,360,000
$ 6,398,873
$ 1,190,000
$ 110,737
Revenue Bonds
As of June 30, 2013, the following unmatured revenue bond issues are outstanding:
Wastewater
Parking Treatment
Water
Taxable Urban
Renewal
Original issue amount
$
9,110,000
$
48,020,000
$
21,815,000
$
2,655,000
Interest rates
3.0% to 5.0%
3.0% to 5.0%
1.5% to 4.5%
1.0% to 3.9%
Annual maturities
$
530,000 to
$
450,000 to
$
385,000 to
$
130,000 to
$
770,000
$
2,205,000
$
835,000
$
200,000
Amount outstanding
$
7,675,000
$
35,205,000
$
19,080,000
$
2,655,000
Revenue bond debt service requirements to maturity are as follows
Fiscal Year Ending
June 30
2014
2015
2016
2017
2018
2019 -2023
2024 -2028
2029 -2033
Total
Governmental Activities Business -type Activities
Principal Interest Principal Interest
130,000
130,000
135,000
710,000
800,000
750,000
75,335
75,335
75,335
74,035
72,345
321,385
223,125
72,740
5,115,000
5,290,000
5,500,000
5,670,000
5,900,000
27,255,000
7,230,000
2,376,928
2,206,665
2,015,284
1,807,671
1,588,927
4,342,583
457,366
$ 2,655,000 $ 989,635 $ 61,960,000 $ 14,795,424
[ »A
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The revenue bond ordinances required that wastewater treatment, parking system, water revenues, and
urban renewal tax revenues be set aside into separate and special accounts as they are received. The use
and the amounts to be included in the accounts are as follows:
Account Amount
(a) Revenue Bond and Interest Amount sufficient to pay current bond and interest maturities.
Sinking Reserve
(b) Revenue Debt Service Reserve Amount required to be deposited in the Revenue Bond and
Interest Reserve until the reserve fund equals: parking Revenue,
Water Revenue and Taxable Urban Renewal Revenue bonds —
maximum debt service due on the bonds in any succeeding fiscal
year. Wastewater Revenue bonds — 125% of the average
principal and interest payments over the life of all the
Wastewater Revenue bonds.
(c) Improvement Reserve $20,000 per month until the reserve balance equals or exceeds
$2,000,000 for Wastewater Revenue bonds and $5,000 per
month until the reserve balance equals or exceeds $450,000 for
Water Revenue bonds, with no further deposits once the
minimum balance is reached. If the reserve falls below the
required minimum, monthly transfers in the aforementioned
amounts will resume.
On November 29, 2012, the City of Iowa City issued taxable urban renewal revenue bonds in the amount
of $2,655,000. The bonds were issued to finance costs of aiding in the planning, undertaking and
carrying out of an urban renewal project.
tx:3
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Summary of Bond Issues
General obligation and revenue bonds payable at June 30, 2013, are comprised of the following issues:
$ 123,165,000
MYl
Date of
Amount
Interest
Final
Outstanding
Issue
Issued
Rates
Maturity
June 30, 2013
General Obligation Bonds:
Multi - Purpose
Mar. 2005
7,020,000
3.0-4.0
6/15
$ 1,610,000
Multi - Purpose
Jun. 2006
6,265,000
3.625-4.0
6/16
2,190,000
Multi - Purpose
Jun. 2006
1,000,000
5.5-
5.6
6/16
365,000
Refunded Water
Construction (1)
Sep. 2006
3,350,000
3.6-3.75
6/17
1,190,000
Multi - Purpose
May 2007
8,870,000
3.75
6/17
3,950,000
Multi - Purpose
June 2008
9,150,000
3.25-3.75
6/18
4,960,000
Refunded Muffi- Purpose (2)
Oct. 2008
17,005,000
3.0-3.75
6/18
7,395,000
Multi - Purpose
June 2009
6,685,000
2.5-4.0
6/19
4,220,000
Taxable- Housing Improvements
June 2009
505,000
1.5-3.0
6/14
105,000
Refunded Muffi- Purpose (3)
June 2009
5,840,000
2.0-4.0
6/16
2,640,000
Multi- Purpose
Aug. 2010
7,420,000
2.0-2.75
6/20
5,250,000
Multi- Purpose
June 2011
7,925,000
2.0-3.625
6/21
6,425,000
Refunded Multi- Purpose and
Library Construction (4)
June 2011
10,930,000
2.0-3.625
6/21
9,635,000
Multi- Purpose
June 2012
9,070,000
2.0-2.25
6/22
8,305,000
Taxable -Urban Renewal
June 2012
620,000
0.5-0.6
6/14
310,000
Total General Obligation Bonds
$ 58,550,000
Date of
Amount
Interest
Final
Outstanding
Issue
Issued
Rates
Maturity
June 30, 2012
Revenue Bonds:
Refunded Parking Bonds (5)
Nov. 2009
$ 9,110,000
3.0-5.0
7/24
$ 7,675,000
Refunded Wastewater
Treatment Bonds (6)
Oct. 2008
24,280,000
3.0-5.0
7/22
17,880,000
Refunded Wastewater
Treatment Bonds (7)
May 2009
8,660,000
3.5
- 5.0
7/25
7,675,000
Refunded Wastewater
Treatment Bonds (8)
Apr. 2010
15,080,000
3.0-4.0
7/20
9,650,000
Refunded Water Bonds (9)
Oct. 2008
7,115,000
3.0-4.375
7/24
5,700,000
Refunded Water Bonds (10)
May 2009
9,750,000
4.0-4.5
7/25
8,430,000
Refunded Water Bonds (11)
June 2012
4,950,000
1.5
- 2.1
7/22
4,950,000
Taxable Urban Renewal
Nov. 2012
2,655,000
1.0-3.9
6/32
2,655,000
Total Revenue Bonds
$ 64,615,000
$ 123,165,000
MYl
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
(1) This bond issue has the general obligation bonds payable shown as a liability on the balance sheet
of the Water Fund. Also, this bond issue refunded the November 1997 Water Construction General
Obligation Bonds.
(2) This bond issue refunded the April 1998, March 1999, and July 2000 General Obligation Bonds.
(3) This bond issue refunded the June 2001 General Obligation Bonds.
(4) This bond issue refunded the May 2002 General Obligation Bonds.
(5) This bond issue refunded the December 1999 Parking Revenue Bonds.
(6) This bond issue refunded the March 1996, May 1997, and January 1999 Wastewater Revenue
Bonds.
(7) This bond issue refunded the October 2000 Wastewater Revenue Bonds.
(8) This bond issue refunded the December 2001 and April 2002 Wastewater Revenue Bonds.
(9) This bond issue refunded the May 1999 Water Revenue Bonds.
(10) This bond issue refunded the December 2000 Water Revenue Bonds.
(11) This bond issue refunded the October 2002 Water Revenue Bonds.
Conduit Debt Obligations
From time to time, the City has issued Industrial Development Revenue Bonds, Facility Refunding
Revenue Bonds, and Midwestern Disaster Area Revenue Bonds to provide financial assistance to private
sector entities for the acquisition, construction, and renovation of industrial and commercial facilities
deemed to be in the public interest. The bonds are collateralized by the property financed and are payable
solely from payments received on the underlying mortgage loans. All payments on the bonds are made by
the private sector entities directly to a bond trustee, who is a third party financial institution, and in turn,
disburses the payment to the respective bond holders. Neither the City, the State, nor any political
subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not
reported as liabilities in the accompanying financial statements.
As of June 30, 2013, there were four series of Industrial Development Revenue Bonds, Facility
Refunding Revenue Bonds, and Midwest Disaster Area Revenue Bonds outstanding, with an aggregate
principal amount payable of $42,122,114.
Debt Legal Compliance
Legal Debt Margin:
As of June 30, 2013, the general obligation debt issued by the City did not exceed its legal debt limit
computed as follows (amounts expressed in thousands):
Assessed valuation
Real property
$ 4,531,989
Utilities
83,538
Total valuation
$ 4.615.527
Debt limit, 5% of total assessed valuation
$ 230,776
Debt applicable to debt limit:
General obligation bonds
58,550
Legal debt margin
$ 172.226
rill
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
7. Other Long -term Liabilities
Notes Payable
Note Payable activity for the year ended June 30, 2013, was as follows:
Due Within
July 1, 2012 Issues Retirements June 30, 2013 One Year
Governmental activities: $ 211,000 $ - $ - $ 211,000 $ -
A note payable was issued to Greater Iowa City Housing Fellowship for the purchase of an 11 unit
apartment building for low income and disabled housing in the Peninsula Neighborhood. The terms of
the loan are 1 %, interest only payments for twenty years with a final balloon payment of $211,000 due on
August 1, 2025.
Employee Vested Benefits
Changes in Long -Term Liabilities - Employee Vested benefits
Employee Vested Benefits activity for the year ended June 30, 2013, was as follows:
July 1, 2012 Due Within
(Restated) Issues Retirements June 30, 2013 One Year
Governmental activities: $ 2,027,799 $ 1,190,536 $ 1,107,721 $ 2,110,614 $ 1,160,900
Business -type activities: $ 763,444 $ 414,166 $ 434,910 $ 742,71)0 $ 427,285
For the governmental activities, employee vested benefits are generally liquidated by the General Fund
and Community Development Block Grant Fund.
71
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Landfill Closure / Post - Closure Care Costs
Changes in Long -Term Liabilities - Landfill Closure Post - closure Care Costs
Landfill Closure Post-closure care activity for the year ended June 30, 2013, was as follows:
July 1, 2012 Due Within
(as Restated) Issues Retirements June 30, 2013 One Year
Business type activities: $ 6,116,618 $ 288,297 $ $ 6,404,915 $ -
In August 1993, the GASB issued Statement No. 18, Accounting.for Municipal Solid Wavte Landfill
Closure and Post - closure Care Costs (the Statement). Under these rules, in addition to operating
expenses related to current activities of the landfill, an expense provision and related liability are being
recognized based on the future closure and post - closure care costs that will be incurred near or after the
date the landfill no longer accepts waste. The recognition of these landfill closure and post - closure care
costs is based on the amount of the landfill used during the year.
The estimated liability for landfill closure and post - closure care costs as of June 30, 2013, is $6,404,915,
which is based on 45.72% usage (filled) of the landfill and is included in accrued liabilities within the
Sanitation Fund. It is estimated that an additional amount of approximately $7,604,085 will be recognized
as closure and post - closure care expenses between the date of the balance sheet and the date the landfill is
expected to be filled to capacity by the year ended June 30, 2025. The estimated total current cost of the
landfill closure and post - closure care costs at June 30, 2013, was determined by a licensed professional
engineer and approximated at $14,009,000. It is based on the amount that would be paid if all equipment,
facilities, and services required to close, monitor, and maintain the landfill were acquired as of June 30,
2013. These amounts are based on an estimated post - closure care and monitoring period of 30 years,
consistent with current State Department of Natural Resources regulations. However, the actual cost of
closure and post - closure care may be higher due to inflation, changes in technology, or changes in landfill
laws and regulations.
The City is required by federal and state laws and regulations to provide some form of financial assurance
to finance closure and post - closure care. The City will meet its financial assurance obligations through the
issuance of general obligation bonds. As of June 30, 2013, the Sanitation Fund had $15,260,663 in related
equity in pooled cash and investments, at fair value designated for satisfaction of closure and post - closure
costs. The City estimates that these cash reserves will only provide a fraction of the dollars needed to
close and monitor the landfill. The remaining portion of post - closure care costs, anticipated future
inflation costs and additional costs that might arise from changes in post- closure requirements (due to
changes in technology or more rigorous environmental regulations, for example) may need to be covered
by charges to future landfill users as well as City taxpayers.
rra
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Other Post Employment Benefits
Changes in Long -Term Liabilities - Other Post Employment Benefits
July 1, 2012
(as Restated)
Net OPBB Obligation
Current Year June 30, 2013
Governmental activities:
$
1,883,268
$
478,989
$
2.362.257
Business type activities:
$
803,530
$
139,839
$
943,369
The City implemented GASB Statement No. 45, Accounting and Financial Reporting by Employers for
Postemployment Benefits other Than Pensions during the year ended June 30, 2009.
Plan Description: The City operates one self- funded medical and dental plan for all employees, which is
offered to current and retired employees and their dependents. All full -time employees who retire or
terminate /resign and their eligible dependents are offered the following post - employment benefit options:
Health insurance and dental insurance — The option of continuing with the City's health insurance
plan at the individual's expense. These benefits cease upon Medicare eligibility.
Life insurance — The option of converting the employee's City -paid policy to an individual policy at
the individual's expense with the City's life insurance carrier.
Long -term disability — For employees who terminate/resign and have been on the plan for a minimum
of one year, the option of converting the employee's City -paid group policy to a personal policy at the
individual's expense with the City's long -term disability insurance carrier.
The above options, while at the individual's own expense, are included within the City's overall insurance
package, which results in an implicit rate subsidy and an OPEB liability.
Funding Policy: The plan member's contribution requirements are established and may be amended by
the City. The City currently finances the benefit plans on a pay -as- you -go basis.
rKl
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Annual OPEB Cost and Net OPEB Obligation: The City's annual OPEB cost is calculated based on the
annual required contribution (ARC) of the City, an amount actuarially determined in accordance with
GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is
projected to cover normal costs each year and amortize any unfunded actuarial liabilities over a period not
to exceed 30 years.
The following table shows the components of the City's annual OPEB cost for the year ended June 30,
2013, the amount actually contributed to the plans, and changes in the City's net OPEB obligation:
Annual required contribution $ 643,988
Interest on net OPEB obligation 94,038
Adjustment to annual required contribution (89,560)
Annual OPEB costs 648,466
Contributions made (29,638)
Increase in net OPEB obligation 618,828
Net OPEB obligation beginning of year 2,686,798
Net OPEB obligation end of year $3305.626
For calculation of the net OPEB obligation, the actuary has set the transition day as July 1, 2008. The end
of year net OPEB obligation was calculated by the actuary as the cumulative difference between the
actuarially determined funding requirements and the actual contributions for the year ended June 30,
2013.
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plans and the net
OPEB obligation as of June 30, 2013 are summarized as follows:
Percentage of Annual
OPEB Cost
Annual
Year Ended
OPEB Cost
June 30, 2011
$ 598,776
June 30, 2012
$ 600,965
June 30, 2013
$ 648,466
Percentage of Annual
OPEB Cost
Net OPEB
Contributed from City
Obligation
14.7%
$2,257,342
28.5%
$2,686,798
4.6%
$3,305,626
Funded Status and Funding Progress: As of July 1, 2012, the most recent actuarial valuation date for the
period July 1, 2012 through June 30, 2013, the actuarial accrued liability was $7,163,715, with no
actuarial value of assets, resulting in an unfunded actuarial accrued liability (UAAL) of $7,163,715. The
covered payroll (annual payroll of active employees covered by the plans) was $34,992,423 and the ratio
of the UAAL to covered payroll was 20.5 %. As of June 30, 2013, there were no trust fund assets.
Actuarial Methods and Assumptions: Actuarial valuations of an ongoing plan involve estimates of the
value of reported amounts and assumptions about the probability of events far into the future. Examples
include assumption about future employments, mortality, and the health care cost trend. Actuarially
determined amounts are subject to continual review as actual results are compared with past expectations
and new estimates are made about the future. Actuarial calculations of the OPEB plan reflect a long -term
perspective.
74
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The required schedule of funding progress, presented as required supplementary information in the
section following the Notes to Financial Statements, will present multi -year trend information about
whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial
accrued liabilities for benefits.
Calculations are based on the types of benefits provided under the terms of the substantive plan at the
time of each valuation and on the pattern of sharing of costs between the employer and plan members to
that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the
potential effects of legal or contractual funding limitations on the pattern of cost sharing between the
employer and plan members in the future.
As of the July 1, 2012 actuarial valuation date, the actuarial cost method used is the entry-age normal
method. The actuarial assumption includes a 3.5% discount rate and an inflation rate of 3% per annum.
The projected annual medical trend rate is 8.5 %. The ultimate medical trend rate is 5.0 %. The medical
trend rate is decreased to 8.0% for year two and then reduced by 0.5% each year until reaching the 5.0%
ultimate trend rate. The projected annual dental trend rate is 5.0 %. The ultimate dental trend rate is 4 %.
The dental trend rate is decreased to 4.75% for year two and then reduced by 0.25% each year until
reaching the 4% ultimate trend rate.
Mortality rates for active employees are from the RP -2000 Employee Table (Male and Female) Projected
to 2013 (Projection Scall AA). For retirees, mortality rates are from the RP -2000 Healthy Annuitant
Table (Male and Female) Projected to 2013 (Projection Scale AA). Annual retirement and termination
probabilities were developed from the retirement probabilities from the MFPRSI and IPERS pension plan
turnover tables, adjusted to be consistent with expected first fiscal year retirements.
Projected claim costs of the health and dental plans are $821.13 per month. The salary increase rate was
assumed to be 3.5% per year. The UAAL is being amortized as a level percentage of projected payroll
expenses over 30 years on an open basis.
8. Short Term Debt
Notes Payable activity for the year ended June 30, 2013, was as follows:
Due Within
July 1, 2012 Issues Retirements June 30, 2013 One Year
Governmental activities: $ 805,000 $ 976,826 $ 1,243,826 $ 538,000 $ 538,000
During FY13, the City entered into additional multiple short term loans totaling $976,826 and repaid
multiple short term loans totaling $1,243,826. The outstanding loans mature one year from the date of the
loan and bear interest rates ranging from 2% to 3.25 %. The loans were used to fund the acquisition and
rehabilitation of single family homes as part of the UniverCity Neighborhood Partnership Program
(UniverCity). UniverCity is a cooperative effort of the City of Iowa City and the University of Iowa
dedicated to ensuring that the University of Iowa Campus and surrounding neighborhoods remain vital,
safe, affordable, and attractive places to live and work for both renters and homeowners. The short term
loans have been repaid and will be repaid with the proceeds from the sale of the rehabilitated homes.
NO
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The short term loans have been repaid and will be repaid with the proceeds from the sale of the
rehabilitated homes.
9. Fund Equity
Fund balances for the governmental funds are reported in classifications that comprise a hierarchy based
on the extent to which the government honors constraints on the specific purposes for which amounts in
those funds can be spent.
• The Nonspendable classification contains amounts not in spendable form or legally or
contractually required to be maintained intact.
• Restricted amounts contain restraint on their use externally imposed by creditors, grantors,
contributors, or laws or regulations of other governments; or imposed by law through
constitutional provisions or enabling legislation.
• Committed amounts can only be used for specific purposes imposed by formal action of the
government's highest level of decision- making authority. The highest level of decision- making
authority is the City Council and it takes a resolution to establish, modify or rescind a fund
balance commitment.
• Amounts intended to be used for specific purposes are Assigned. Assignments should not cause
deficits in the Unassigned fund balance. The Finance Director has been delegated authority by
the City Council through a resolution to assign amounts to be used for specific purposes.
• Unassigned fund balance is the residual classification for the General Fund.
The City would use Restricted fund balances first, followed by Committed resources, and then Assigned
resources, as appropriate opportunities arise, but reserves the right to selectively spend Unassigned
resources first to defer the use of these other classified funds.
VM
Components of Fund Balance
Nonspendable:
Perpetual Care Principal
Total Nonspendable
Restrictedtor:
Public Safely
Local Option Sales Tax
Debt Service
GO Bond Projects
State Funding
Grant Agreement
Public Safely Employee
Benefits
Other Restricted
Total Restricted
Assigned to:
Library Programs
Senior Center Programs
Replacement and Acquisition Reserves
Other Assigned
Total Assigned
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Community Other
Development Shared Other
Employee Block Revenue and Other Debt Governmental
General Benefits Grant Grants Construction Service Funds Total
$ 69.000 $ - $ - $ - $ - $ - $ - $ 69.000
69.000 - - - - - - 69.000
630.118
25, 006.448
2,913,535
8,436272
7265326
7542654
630.118
25,006.448
7.265.326
15, 978, 926
2, 913, 535
- 1791164 - - - - - 1.791.164
52.038 - - - - - 160.504 212.542
25.688.604 1.791.164 - 2.913.535 8.436.272 7.265.326 7.703.158 53.798.059
647 681
41.269
1 021162
33.405
1.743.517
647 681
41.269
1 021162
33.405
1.743.517
Unassigned: 17.113.181 - (2695) (280,684) (4,194,174) (737850) (624.068) 11.268.710
Total Fund Balances $ 44.614.302 $ 1791.164 $ (2695) $ 2.632.851 $ 4,242.098 $ 6.527.476 $ 7.079.090 $ 66.879.286
10. Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
workplace accidents, errors and omissions; and natural disasters. During fiscal year 1988 the City
established the Loss Reserve Fund, an internal service fund, to account for and finance its uninsured risks
of loss. During the year ended June 30, 2013 the City purchased property, liability, and workers'
compensation insurance under the program that provides for a $100,000 self - insured retention per
occurrence on property losses, a $500,000 self- insured retention per occurrence on liability, and a
$500,000 self - insured retention on workers' compensation losses. The liability insurance provides
coverage for claims in excess of the aforementioned self - insured retention up to a maximum of
$21,000,000 annual aggregate of losses paid. Settled claims have not exceeded this commercial coverage
in any of the past twenty five fiscal years. The operating funds pay annual premiums to the Loss Reserve
Fund. Accumulated monies in the Loss Reserve Fund are available to cover the self - insured retention
amounts and any uninsured losses.
rrIA
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The Housing Authority Fund is insured under a separate policy with the Assisted Housing Risk
Management Association. The remaining funds participate in the Loss Reserve Fund. The funds make
payments to the Loss Reserve Fund based on actuarial estimates of the amounts needed to pay prior- and
current -year claims and to establish a reserve for catastrophic losses. The Fund's accrued liabilities
balance includes a claims liability at June 30, 2013 based on the requirements of GASB Statement No.
10, as amended, which requires that a liability for claims be reported if information prior to the issuance
of the financial statements indicates that it is probable that a liability has been incurred at the date of the
financial statements and the amount of the loss can be reasonably estimated. Changes in the Loss Reserve
Fund's claims liability amount for property, liability, and workers' compensation for the years ended
June 30, 2013 and 2012 are as follows:
Also, the City is partially self - insured, through stop -loss insurance, for employee health care coverage,
which is available to all of its permanent employees. This insurance provides stop -loss coverage for
claims in excess of $125,000 per employee with an aggregate stop -loss of $8,406,094. The operating
funds are charged premiums by the Loss Reserve Fund. The City reimburses a health insurance provider
for actual medical costs incurred, plus a claims processing \administrative fee. Changes in the Loss
Reserve Fund's claims liability amount for health care coverage for the years ended June 30, 2013 and
2012 are as follows:
2011-2012
2012-2013
Current -Year
Beginning -of- Claims and Balance at
Fiscal -Year Changes in Claim Fiscal
Liability Estimates Payments Year -End
728,000 $ 6,147,000
716,000 5,480,000
VM
$ 6,159,000 $ 716,000
5,687,000 509,000
Current -Year
Beginning -of-
Claims and
Balance at
Fiscal -Year
Changes in
Claim
Fiscal
Liability
Estimates
Payments
Year -End
2011 —2012 $ 700,000
$ 691,000
$ 207,000
$ 1,184,000
2012 —2013 1,184,000
1,616,000
1,177,000
1,623,000
Also, the City is partially self - insured, through stop -loss insurance, for employee health care coverage,
which is available to all of its permanent employees. This insurance provides stop -loss coverage for
claims in excess of $125,000 per employee with an aggregate stop -loss of $8,406,094. The operating
funds are charged premiums by the Loss Reserve Fund. The City reimburses a health insurance provider
for actual medical costs incurred, plus a claims processing \administrative fee. Changes in the Loss
Reserve Fund's claims liability amount for health care coverage for the years ended June 30, 2013 and
2012 are as follows:
2011-2012
2012-2013
Current -Year
Beginning -of- Claims and Balance at
Fiscal -Year Changes in Claim Fiscal
Liability Estimates Payments Year -End
728,000 $ 6,147,000
716,000 5,480,000
VM
$ 6,159,000 $ 716,000
5,687,000 509,000
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
11. Commitments and Contingencies
The total outstanding contractual commitments as of June 30, 2013 are as follows:
Fund
Project
Bridge, street and traffic
Paving and bridge construction,
control construction
engineering design and consulting
Other construction
Public works, culture & recreation, Economic Dev,
Fire & Police, construction
Wastewater
South wastewater plant expansion
Sanitation
Landfill cell reconstruction
Airport
Runway grading and paving
The total significant encumbrances as of June 30, 2013 are as follows:
Fund Project
Other Construction Financial System, library equipment and
police equipment
rct
Amount
$ 7,657,330
1,927,869
10,488,259
923,725
626,171
$ 21,623,354
Amount
$ 587,636
$ 587,636
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
12. Contingent Liabilities
Litigation
The City is a defendant in a number of lawsuits arising principally from claims against the City for
alleged improper actions by City employees, with such lawsuits typically involving claims of improper
police action, unlawful taking of property by zoning, negligence, appeals of condemnations, and
discrimination. Total damages claimed are substantial; however, it has been the City's experience that
such actions are settled for amounts substantially less than claimed amounts. The City's management
estimates that the potential claims against the City, not covered by various insurance policies, would not
materially affect the financial condition of the City. The City has the authority to levy additional taxes
(outside the regular limit) to cover uninsured judgments against the City.
13. Pension and Retirement Systems
Municipal Fire and Police Retirement System of Iowa
The City is a participating employer in the Municipal Fire and Police Retirement System of Iowa
(MFPRSI or the Plan), which is a cost - sharing multiple - employer defined benefit public police and fire
employees retirement system. All fire fighters and police officers appointed under civil service participate
in the Plan. The Plan provides retirement, disability, and death benefits that are established under state
statute. The Plan issues a publicly available financial report that includes financial statements and
required supplementary information. The report may be obtained by writing to Municipal Fire and Police
Retirement System of Iowa, 7155 Lake Drive Suite 201, West Des Moines, Iowa 50266 or the report may
be obtained from website www.mfprsi.org under the publications link. A member may retire at age 55
with 22 years of employment, and receive full benefits that are equal to 66% of the member's average
final compensation. Additionally, members retiring with more than 22 years of service will receive an
additional 2% of the member's average final compensation for up to 8 years of additional service. Other
benefits are also calculated at varying percentages of the average final compensation. Benefits vest after
four years of service.
Member contribution rates are established by state statute. For the fiscal year ended June 30, 2013,
members contributed 9.40 %. The City's contribution rate is based upon an actuarially determined normal
contribution rate. The normal contribution rate is provided by state statute to be the actuarial liabilities of
the plan less current plan assets, the total then being divided by 1% of the actuarially determined present
value of prospective future compensation of all members, further reduced by member contributions.
Legislatively appropriated contributions from the state to the plan may further reduce the City's
contribution rate. However, the City's contribution rate may not be less than 17% of earnable
compensation.
The City was required to contribute 26.12% of earnable compensation of each member in FY 2013,
24.76% of earnable compensation in FY 2012, and 19.9% of earnable compensation in FY 2011. The
contributions paid by the City for the years ended June 30, 2011, 2012, and 2013, were $1,826,791,
$2,232,637, and $2,428,631.85 respectively, and was equal to the required contributions for each year.
E:AI
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Iowa Public Employees Retirement System
The City contributes to the Iowa Public Employees Retirement System ( IPERS), which is a cost - sharing
multiple - employer defined benefit pension plan administered by the State of Iowa. IPERS provides
retirement and death benefits, which are established by State statute to plan members and beneficiaries.
IPERS issues a publicly available financial report that includes financial statements and required
supplementary information. The report may be obtained by writing to IPERS, P.O. Box 9117, Des
Moines, Iowa 50306 -9117.
All employees eighteen or older, except temporary employees of six months or less of employment
duration, who do not participate in any other public retirement system in the state are eligible and must
participate in IPERS. The pension plan provides retirement and death benefits that are established by state
statute. Generally, a member may retire at the age of 65, or any time after age 62 and 20 years or more of
service, or when age plus years of service equals or exceeds 88, and receive unreduced (for age) benefits.
Members may also retire at the age of 55 or more at reduced benefits. Benefits vest after seven years of
service or after attaining the age of 55. Full benefits are equal to 60% of the average of the highest five
years of covered wages times years of service divided by 30.
Plan members are required to contribute 5.78% of their annual covered salary and the City is required to
contribute 8.67% of annual covered payroll. Contribution requirements are established by state statute.
The City's contributions to IPERS for the years ended June 30, 2011, 2012, and 2013, were $1,969,422,
$2,245,326, and $2,423,438 respectively, and were equal to the required contributions for each year.
14. Additional Revenue Bond Disclosures
Water System
The Water Division is comprised of five parts: Administration, Treatment Plant, Customer Service,
Distribution, and Public Information/Education. There are a total of 32.75 (FTE) employees who work in
the Water Division. This division serves 70,133 people and has 26,150 customers. The average daily use
for fiscal year 2013 was approximately 5.54 million gallons per day (MGD). A peak flow of over 8.6
MGD was experienced during the summer of 2012.
Water Sources: The primary source of water for the City is the alluvial aquifer collector wells along the
Iowa River. Four collector wells can provide approximately 10.5 MGD. Additional sources include two
Jordan aquifer wells which can provide 2.0 MGD; three Siluran aquifer wells which can provide 1.0
MGD; a sand pit that can provide 1.0 MGD; a river intake that can provide 3.0 MGD; for a total of
approximately 17.5 MGD maximum capacity.
Water Treatment Processes: The facilities include one treatment plant (constructed in 2003) located at 80
Stephen Atkins Drive. The plant is a surface water plant design that includes aeration, lime softening
( coagulation /flocculation/sedimentation), and granular activated carbon filtration processes with
fluoridation and free chlorination. The grade four water facility employs operators that perform over 200
water quality tests per day in -house and collect samples for testing at the University Hygienic Laboratory.
This testing ensures that the water meets all of the Safe Drinking Water Act Standards.
81
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Distribution System: The water flows through approximately 268 miles of water mains and includes over
25,000 service connections. The distribution piping consists of cast iron, ductile and PVC main that
ranges in size from 2" to 30 ". The treatment plant site has effective water storage capacity of 1.75 million
gallons of water; in addition there are four remote ground storage reservoirs (with pumping stations) that
add up to remote effective storage capacity of 6.0 million gallons of water. The water system also
provides for fire protection with approximately 3,330 public and private hydrants located throughout the
community.
Billing and Collections: Customers are billed monthly on a combined utility statement which includes
charges for sewer, water, solid waste, and curbside recycling. Under present City policy and City
ordinances, utility bills are due when received but contain a delinquency date which provides 15 days for
payment. If payment is not made in full within 22 days, a notice is mailed which allows 25 calendar days
before service is disconnected. The City's bad debt write -offs have been less than 0.5% of gross revenues
for the past three years.
Rates:
The following rates and charges were effective July 1, 2012.
Water Service Charge Minimums (includes up to the first 100 cubic feet (c.f.))
Meter Size
(Inches)
Charge
5/8"
$6.41
3/4"
7.00
1"
8.26
1 1/2"
16.47
Meter Size
(Inches)
Charge
2"
$22.14
3"
40.91
4"
71.37
6"
143.61
Monthly Usage in excess of 100 cubic feet (c.f.)
101-3,000 $2.99 per 100 c.f.
3,001 and over $2.15 per 100 c.f.
Single Purpose Meter Charges
First 100 (c.f)
Usage in excess of 100 cubic feet (c.f.)
Changes in water rates over the last ten fiscal years:
2004
-5%
2005
0%
2006
0%
2007
-5%
2008
0%
2009
0%
2010
0%
2011
0%
2012
0%
2013
0%
E:YJ
Minimum Monthly Charge
$2.99 per 100 c.f.
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Financial Information: The following table summarizes the results of operations for the Water System for
the fiscal years ended June 30, 2013, 2012, and 2011.
WATER SYSTEM
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
Last Three Fiscal Years
(amounts expressed in thousands)
&it1
2013
2012
2011
Operating Revenues:
Charges for services
$ 8,583
$ 8,419
$ 8,054
Miscellaneous
174
26
42
Total operating revenues
8,757
8,445
8,096
Operating Expenses:
Personal services
2,633
2,554
2,407
Commodities
1,609
967
929
Services and charges
2,106
2,132
2,128
6,348
5,653
5,464
Depreciation
2,169
2,275
2,230
Total operating expenses
8,517
7,928
7,694
Operating income
240
517
402
Nonoperating Revenues (Expenses):
Gain ( Loss) on disposal of capital assets
-
(10)
-
Insurance Recoveries
-
-
2
Operating Grants
442
-
-
Interest income
143
204
256
Interest expense
(731)
(964)
(1,032)
Total nonoperating revenues (expenses)
(146)
(770)
(774)
Income before capital contributions
and transfers
94
(253)
(372)
Capital contributions
494
1,057
973
Transfers in
893
478
795
Transfers out
(1,481)
(1 w)
(336)
Change in net assets
-
1,172
1,060
Net Assets, Beginning
63,274
62,102
61,042
Net Assets, Ending
$ 63,274
$ 63,274
$ 62,102
&it1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The following table summarizes the budget and actual figures for the Water System for the fiscal year
ended June 30, 2013 and the budget for the fiscal year ended June 30, 2014 on a cash basis.
WATER SYSTEM
BUDGET AND ACTUALS (CASH BASIS)
For the Year Ended June 30, 2013
(amounts expressed in thousands)
The following table summarizes the Water System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
WATER SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Last Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds $ 7,410 $ 8,284 $ 9,607
Restricted and Designated Funds 4,631 4,260 4,665
Total Funds on Hand $ 12.041 $ 12.544 $ 14.272
PPI
FY 14
Actual
Budget
Percentage
Budget
Charges for services
$
8,673
$
8,185
105.96%
$
8,226
Interest income
144
141
102.13%
148
Miscellaneous
174
39
446.15%
12
Operating grants
1,395
2,284
61.08%
-
Transfers from other funds
355
336
105.65%
-
Bond sales
0.00%
Total Receipts
$
10,741
$
10,985
97.78%
$
8,386
Personal services
$
2,714
$
2,640
102.80%
$
2,690
Commodities
515
645
79.84%
603
Services and charges
2,162
2,096
103.15%
2,009
Capital outlay
2,408
4,448
54.14%
1,244
Transfer to capital project funds
1,406
1,908
73.69%
-
Transfers to other funds
43
-
4300.00%
Operating subsidy
24
24
100.00%
-
Debt service payments
7,411
8,216
90.20%
2,329
Total Disbursements
$
16,683
$
19,977
83.51%
$
8,875
The following table summarizes the Water System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
WATER SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Last Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds $ 7,410 $ 8,284 $ 9,607
Restricted and Designated Funds 4,631 4,260 4,665
Total Funds on Hand $ 12.041 $ 12.544 $ 14.272
PPI
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Sewer System
The City of Iowa City operates a municipal Sewer Utility System consisting of approximately 295 miles
of sanitary sewers, 15 sanitary sewer lift stations, 2 storm water pumping stations, and 2 treatment plants.
There are a total of 25.40 (PTE) employees who work in the Wastewater Division. This division serves
70,133 people and has over 24,000 customers. The average daily combined treatment flow for 2013 was
9.84 million gallons per day (MGD).
The North Plant was constructed in 1935 and the South Plant was completed in 1990 and upgraded in
2002. The connecting of the North and South Plants was completed in 1998. The City has the capability
to divert all wastewater treatment to the South Plant and control all operations remotely through computer
systems. The combined wastewater treatment system design has a maximum daily treatment capacity of
41.10 MGD. Both plants are in compliance with federal clean water standards. The City is utilizing
federal and state grants to fund a flood recovery and mitigation project to decommission the North
Wastewater Plant through expansion of the South Wastewater Plant.
Billing and Collections: Customers are billed monthly on a combined utility statement which includes
charges for sewer, water, solid waste, and curbside recycling. Under present City policy and City
ordinances, utility bills are due when received but contain a delinquency date which provides 15 days for
payment. If payment is not made in full within 22 days, a notice is mailed which allows 25 calendar days
before service is disconnected. The City's bad debt write -offs have been less than 0.5% of gross revenues
for the past three years.
Rates:
The following rates and charges were effective July 1, 2012.
Sewer Service Charge Minimum (includes up to the first 100 cubic feet (c.f.)) $8.15
Monthly Usage in excess of 100 cubic feet (c.f.) $3.99
Changes in sewer rates over the last ten fiscal years:
2004
0%
2005
0%
2006
0%
2007
8%
2008
0%
2009
5%
2010
0%
2011
0%
2012
0%
2013
0%
1.11
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Financial Information: The following table summarizes the results of operations for the Sewer System for
the fiscal years ended June 30, 2013, 2012, and 2011.
SEWER SYSTEM
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
Lust Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Revenues:
Charges for services $ 12,832 $ 12,670 $ 12,836
Miscellaneous 102 145 63
Total operating revenues 12,934 12,815 12,899
Operating Expenses
Personal services
1,938
1,993
1,961
Commodities
854
954
895
Services and charges
2,548
2,716
2,621
Interest expense
5,340
5,663
5,477
Deprcciation
3,912
3,952
4,017
Total operating expenses
9 ,252
9,615
9,494
Operating income
3,682
3,200
3,405
Nonoperating Revenues (Expenses)
Gain (loss) on disposal of capital assets
-
(12)
(40)
Operating grants
-
-
Interest income
367
360
382
Interest expense
(1,400)
(1,564)
(1,704)
Total nonoperating revenues (expenses)
(1,033)
(1,216)
(1,362)
Income before capital contributions
and transfers
2,649
1,984
2,043
Capital contributions
30,841
3,223
2,394
Transfers in
7,322
2,454
1,716
Transfers out
(1,566)
(359)
(171)
Change in net assets
39,246
7,302
5,982
Net Assets, Beginning
92,032
84,730
78,748
Net Assets, Ending $
131,278
S 92,032
$ 84,730
I -A
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The following table summarizes the budget and actual figures for the Sewer System for the fiscal year
ended June 30, 2013 and the budget for the fiscal year ended June 30, 2014 on a cash basis.
SEWER SYSTEM
BUDGET AND ACTUALS (CASH BASIS)
For the Year Ended June 30, 2013
(amounts expressed in thousands)
The following table summarizes the Sewer System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
SEWER SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Last Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds S 15,655 S 14,551 S 12,882
Restricted and Designated Funds 1 0,074 11,905 12,002
Total Funds on Hand S 25,729 S 26,456 S 24,884
E:)I
FY14
Actual
Budgct
Percentage
Budgct
Charges for semces
$
12,890
$
12,759
101.03%
$
12,549
Interest income
291
301
96.68%
276
Miscellaneous
103
57
180.70%
170
Capital grants
23,493
12,808
183.42%
15,051
Local option sales tax
7,116
12,116
58.73%
-
Bond sales
-
-
0.00%
7,000
Total Receipts
$
43,893
$
38,041
115.38%
$
35,046
Personal services
$
2,250
$
2,374
94.78%
$
2,295
Commodities
580
659
72.11%
683
Semces and charges
3,146
4,363
88.01%
2,492
Capital outlay
30,665
26,576
115.39%
26,535
Transfer to capital project funds
1,542
1,573
98.03%
-
Operating subsidy
24
24
100.00%
-
Debt scrvicepayments
6,412
6,412
100.00%
4,724
Total Disbursements
$
44,619
$
41,981
106.28%
$
36,729
The following table summarizes the Sewer System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
SEWER SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Last Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds S 15,655 S 14,551 S 12,882
Restricted and Designated Funds 1 0,074 11,905 12,002
Total Funds on Hand S 25,729 S 26,456 S 24,884
E:)I
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Parking System
The Parking System currently consists of approximately 4,084 parking spaces located at various parking
facilities in the central business district of the City. The Parking Division of the Iowa
City Transportation Services Department oversees the operation of parking garages, parking lots, and on-
street (metered) parking. Parking Services enforces parking regulation in the central business district,
while the Police Department enforces parking regulations in residential areas. Recognizing that there is a
high demand for parking in downtown Iowa City, Parking Services promotes turnover of on -street
metered parking spaces in the core of the downtown. Customers with longer -term needs are encouraged to
use the garages or on streets in outlying areas. There are a total of 29.25 (FTE) employees who work in
the Parking Division.
Parking System Utilization, Demand and Other Considerations: The City tracks Parking System
utilization by the hour in each of the cashiered facilities. During peak hours, the occupancy rate
regularly runs between 85% to 99% depending on the time of year and the time of day. Peak hours for
the Parking System are 10:00 am through 3:00pm with high occupancy rates regularly maintained
through 5:30 pm daily.
In addition to hourly parking, the Parking System offers monthly permit parking. The Parking System
currently has 1,449 permit holders. The largest customer for the monthly permit parking is the
University of Iowa with 615 permits. There are currently over 623 people on the Parking System's
waiting lists for monthly permit parking.
In addition to monthly and permit parking, the Parking System has parking space contracts with the
Sheraton Hotel in the amount of $8,000.00 per month and with the Hotel Vetro in the amount of
$2,000.00 per month.
The City regularly evaluates parking demand. As development has continued to move south of
Burlington Street and the central business district, the need for additional spaces in this area has
increased. The Applied Real Estate Analysis ( "AREA "), in conjunction with Desman Associates,
estimates that there is demand for 600 additional parking spaces in downtown Iowa City. The
underlying economic growth and employment base of the City continues to contribute to increased
demand.
Parking System Rates and Charges: Rates for the Parking System are set by the City Council. Parking
System rates are reviewed annually. The rates vary by facility and the hourly and monthly rates and
charges as approved by the City Council are listed below by facility. These rates include the most recent
hourly rate adjustments that were approved by the City Council on March 21, 2006 and became effective
July 1, 2006 and the proposed monthly permit rate adjustments that were approved by the City Council
on June 2, 2009 and became effective July 1, 2009.
1.1 .3
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Parking Facilities: The Parking System consists of 3 cashiered garages and 1 unattended garage, as well
as, various parking lots and on -street metered parking in the Central Business District. The City
completes regular visual inspections of the parking garages to evaluate their current appearance and
general condition. The garages are visually inspected for the condition of the main structural elements
(columns, girders, beams), parking decks, expansion and control joints, and their coating systems.
Based on the most recent inspections, all of the Parking Systems facilities are in excellent/good
condition. All garages will continue to receive routine inspections and maintenance. A description of
each parking facility, their locations, access, the number of spaces, monthly permits, and current rates are
as follows:
Capitol Street Garage
Constructed 1980
Address 220 S. Capitol Street
Description Located on a parcel confined by Burlington Street to the south, Capitol
Street to the west, Clinton Street to the east and the Old Capitol Town
Center to the north.
Access This is a cashiered facility with two entry lanes off of Clinton Street; two
entry lanes off of Capitol Street; and four exit lanes onto Capitol Street.
Spaces 875
Monthly Permits 235
Rates Hourly $0.75 per hour
Monthly $80.00 per month
Changes in Capitol Street Garage rates over the last ten fiscal years:
r.I9
Hourly
Monthly
2004
0%
17%
2005
0%
0%
2006
0%
0%
2007
25%
7%
2008
0%
0%
2009
0%
0%
2010
0%
7%
2011
0%
0%
2012
0%
0%
2013
0%
0%
r.I9
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
Dubuque Street Garage
Constructed
Address
Description
Access
Spaces
Monthly Permits
Rates
June 30, 2013
1980
220 S. Dubuque Street
Located on a parcel confined by Burlington Street to the south, Dubuque
Street to the west, Linn Street to the east and the Sheraton Hotel to the
north.
This is a cashiered facility with two entry lanes off of Dubuque Street;
one entry lanes off of Linn Street; and two exit lanes onto Dubuque
Street.
625
325
Hourly $0.75 per hour
Monthly $80.00 per month
Changes in Dubuque Street Garage rates over the last ten fiscal years:
Chauncey Swan Garage
Constructed
Hourly
Monthly
2004
0%
20%
2005
0%
0%
2006
0%
0%
2007
25%
8%
2008
0%
0%
2009
0%
0%
2010
0%
23%
2011
0%
0%
2012
0%
0%
2013
0%
0%
Chauncey Swan Garage
Constructed
1993
Address
415 E. Washington Street
Description
Located on a parcel confined by College Street to the south, Van Buren
Street to the east, Gilbert Street to the west and Washington Street to the
north.
Access
This is an automated facility with one entry/exit lane off of College
Street; one entry/ exit lane off of Washington Street; and one entry/exit
lane through the Recreation Center parking lot onto Burlington Street.
Spaces
475
Monthly Permits
400
Rates
Hourly $0.60 per hour
Monthly $80.00 per month
Pill
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Changes in Chauncey Swan Garage rates over the last ten fiscal years:
Tower Place Garage
Constructed
Hourly
Monthly
2004
0%
22%
2005
0%
0%
2006
0%
0%
2007
20%
9%
2008
0%
0%
2009
0%
0%
2010
0%
17%
2011
0%
14%
2012
0%
0%
2013
0%
0%
Tower Place Garage
Constructed
2001
Address
335 E. Iowa Avenue
Description
Located on a parcel confined by Iowa City Senior Center to the south,
2005
Gilbert Street to the east, Linn Street to the west and Iowa Avenue to the
0%
north.
Access
This is a cashiered facility with two entry lanes off of Iowa Avenue;
2007
three exit lanes onto Iowa Avenue; and secured permit -only entry and
7%
exit off of Gilbert Street.
Spaces
510
Monthly Permits
315
Rates
Hourly $0.75 per hour
0%
Monthly $80.00 per month
Changes in Tower Place Garage rates over the last ten fiscal years:
451
Hourly
Monthly
2004
0%
17%
2005
0%
0%
2006
0%
0%
2007
25%
7%
2008
0%
0%
2009
0%
0%
2010
0%
7%
2011
0%
0%
2012
0%
0%
2013
0%
0%
451
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
On- Street Parking Meters: The City operates short-term meters (1 -2 hours) concentrated in the
core of the downtown. These meters are intended for shoppers use. Each parking meter dial states the
maximum time. Longer term meters become more common away from the core downtown area.
Meters 1,175
Rates Hourly $0.50 - $0.75 per hour based on proximity to the central
business district and usage.
Parking Lots: The City operates seven parking lots in the Central Business District. They consist of
a mix of permit spaces and metered spaces.
Spaces 430
Monthly Permits 204
Rates Hourly $0.50 - $0.75 per hour based on proximity to the central
business district and usage.
Monthly $60.00 per month
Moped Parking: FY12 saw the implementation of a parking permit program for mopeds, scooters,
and motorcycles. Spaces were designated throughout the Central Business District to accommodate
the use of mopeds and scooters while also removing them from parking in bicycle racks.
Spaces 148
Annual Permits 625
Rates Annual $45.00 per year
PYA
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Financial Information: The following table summarizes the results of operations for the Parking System
for the fiscal years ended June 30, 2013, 2012, and 2011.
PARKING SYSTEM
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
Last Three Fiscal Years
(amounts expressed in thousands)
Operating Revenues:
Charges for services
Miscellaneous
Total operating revenues
Operating Expenses:
Personal services
Commodities
Services and charges
Depreciation
Total operating expenses
Operating income
Nompemting Revenues (Expenses):
Gain (loss) on disposal of capital assets
Operating grants
Interest income
Interest expense
Total nonoperating revenues (expenses)
Income before capital contributions
and transfers
Capital contributions
Transfers in
Transfers out
Change in net assets
Net Assets, Beginning
Net Assets, Ending
2013
2012
2011
$ 5,043
$ 4,743
$ 5,234
37
162
104
5,080
4,905
5,338
1,718
1,733
1,662
630
107
75
1,201
1,194
1,183
3,549
3,034
2,920
787
815
908
4,336
3,849
3,828
744
1,056
1,510
(10)
42
40
51
(324)
(366)
(408)
(282)
(336)
(357)
462
720
1,153
-
4
269
(224)
(16)
-
238
708
1,422
16,722
16,014
14,592
$ 16,960
$ 16,722
$ 16,014
4X1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
The following table summarizes the budget and actual figures for the Parking System for the fiscal year
ended June 30, 2013 and the budget for the fiscal year ended June 30, 2014 on a cash basis.
PARKING SYSTEM
BUDGET AND ACTUALS (CASH BASIS)
For the Year Ended June 30, 2013
(amounts expressed in thousands)
The following table summarizes the Parking System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
PARKING SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Lust Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds $ 5,032 $ 5,218 $ 5,928
Restricted and Designated Funds 1,668 1,528 1,521
Total Funds on Hand $ 6.700 $ 6.746 $ 7.449
4E!
FY 14
Actual
Budget
Percentage
Budget
Charges for services
$
4,623
$
4,500
102.73%
$
4,632
Interest income
47
42
111.901/1
39
Miscellaneous
290
322
90.06%
50
Operating grants
-
-
0.001/1
-
Transfers from Other Funds
-
24
0.001/1
-
Bond sales
0.001/1
Total Receipts
$
4,960
$
4,888
101.47%
$
4,721
Personal services
$
1,697
$
1,881
90.22%
$
1,755
Commodities
62
134
101.091/1
107
Services and charges
1,210
1,197
46.27%
1,270
Capital outlay
647
1,506
42.96%
900
Transfer to capital project funds
45
45
0.001/1
-
Interfund Loan Repayment
507
589
86.08%
-
Debt service payments
839
839
100.001/1
838
Total Disbursements
$
5,007
$
6,191
80.881/1
$
4,870
The following table summarizes the Parking System funds on hand for the fiscal years ended June 30,
2013, 2012, and 2011.
PARKING SYSTEM
FUNDS ON HAND (CASH AND INVESTMENTS)
Lust Three Fiscal Years
(amounts expressed in thousands)
2013 2012 2011
Operating Funds $ 5,032 $ 5,218 $ 5,928
Restricted and Designated Funds 1,668 1,528 1,521
Total Funds on Hand $ 6.700 $ 6.746 $ 7.449
4E!
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
15. Restatement of Beginning Balances
The restatement of fund balances and net assets/net position were due to the following:
The Mass Transportation Fund, which was previously recorded in the General Fund, was reclassified as
an Enterprise Fund. This eliminated approximately $966,000 from the Employee Benefits tax levy
asking, annually. Prior to FY03 the Transit Enterprise Fund continually required funding assistance from
the General Fund. In FY03, Transit Operations were transferred to the General Fund to allow the Transit
employees benefits to be paid by the Employee Benefit Levy. The Employee Benefit Levy can only be
utilized on General Fund and Road Use Tax Fund employee benefits per Iowa Code. In FY06, the Court
Street Transportation Center was built and the operating revenues were assigned to Transit per federal
grants. Since FY08, the Transit operations in the General Fund have provided surplus revenue for
Transit.
Restatements of fund balances, net assets /net position previously reported are as follows:
(Amounts in tbousands)
W-1
Fund Balances /Net
Assets/Net Position,
Effect of
Fund Balances/Net
Ending June 30, 2012
Reclassification of
Assets /Net Position,
as Previously
Mass Transportation
Ending June 30, 2012
Fund
Reported
Fund
as Restated
General
$ 43,557
$ (3,609)
$ 39,948
Capital Projccts -
Otber Construction
$ 20,883
$ (37)
$ 20,946
Governmental Activities
$ 209,925
$ (20,695)
$ 189,230
Transit
$ -
$ 20,695
$ 20,695
Business -type Activities
$ 274,099
$ 20,695
$ 294,794
W-1
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
16. Correction of an error
A prior period adjustment was required in the Sanitation fund. This adjustment was due to the capacity
used in calculating the expense and related liability for future closure and post - closure care costs for the
landfill. The figure that had been used in the calculation was the tonnage of the developed cells versus
the total capacity tonnage of the landfill.
Restatement of net position/net assets previously reported are as follows:
(Amounts in thousands)
Fund
Sanitation
Business -type Activities
After Effect of Reclassification
of Mass Transportation Fund
17. Subsequent events
Net Position/Net
Assets, Ending
June 30, 2012 as Effect of Prior
Previously Period
Reported Adjustment
Net Position/Net
Assets, Ending
June 30, 2012 as
Restated
$ 25,545 $ 6,467 $ 32,012
$ 294,794 $ 6,467 $ 301,261
On July 16, 2013, the City of Iowa City issued General Obligation Bonds, Series 2013A & 2013B, in the
amounts of $7,230,000 and $520,000 respectively. The bonds were issued to finance costs of
acquisitions, construction, improvements and installation of capital improvement projects.
18. New Governmental Accounting Standards Board (GASB) Standards
The Governmental Accounting Standards Board (GASB) has issued six statements not yet implemented
by the City. The statements, which might impact the City's financial statements, are as follows:
Statement No. 65, Items Previously Reported as Assets and Liabilities, issued March 2012, will be
effective for the fiscal year ending June 30, 2014. The objective of this Statement is to establish
accounting and financial reporting standards that reclassify, as deferred outflows of resources or deferred
inflows of resources, certain items that were previously reported as assets and liabilities and recognizes,
as outflows of resources or inflows of resources, certain items that were previously reported as assets and
liabilities.
PA
CITY OF IOWA CITY, IOWA
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 2013
Statement No. 66, Technical Corrections — 2012 — an amendment of GASB Statements No. 10 and No.
62, issued March 2012, will be effective for the fiscal year ending June 30, 2014. The objective of this
Statement is to improve accounting and financial reporting for a governmental financial reporting entity
by resolving conflicting guidance that resulted from the issuance of two pronouncements, Statements No.
54, Fund Balance Reporting and Governmental Fund Type Definitions, and No. 62, Codification of
Accounting and Financial Reporting Guidance Contained in Pre- November 30, 1989 FASB and AICPA
Pronouncements.
Statement No. 67, Financial Reporting for Pension Plans — an amendment of GASB Statement No. 25,
issued June 2012, will be effective for the fiscal year ending June 30, 2014. The objective of this
Statement is to establish accounting and financial reporting requirements related to pensions for
governments whose employees are provided with pensions through pension plans that are covered by the
scope of this Statement, as well as for nonemployer governments that have a legal obligation to contribute
to those plans.
Statement No. 68, Accounting and Financial Reporting for Pensions — an amendment of GASB Statement
No. 27, issued June 2012, will be effective for the fiscal year ending June 30, 2015. The objective of this
Statement is to improve information provided by state and local governmental employers about financial
support for pensions that is provided by other entities.
Statement No. 69, Government Combinations and Disposals of Government Operations, issued January
2013, will be effective for the fiscal year ending June 30, 2015. The objective of this statement is to
improve financial reporting by addressing accounting and financial reporting for government
combinations and disposals of government operations. The term government combinations is used in this
Statement to refer to a variety of arrangements including mergers and acquisitions.
Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees, issued
April 2013, will be effective for the fiscal year ending June 30, 2014. The objective of this Statement is to
improve the recognition, measurement, and disclosure guidance for state and local governments that have
extended or received financial guarantees that are nonexchange transactions.
The City's management has not yet determined the effect these statements will have on the City's
financial statements.
PYA
CITY OF IOWA CITY
BUDGETARY COMPARISON SCHEDULE
BUDGET AND ACTUAL - ALL GOVERNMENTAL FUNDS AND ENTERPRISE FUNDS
BUDGETARY BASIS
REQUIRED SUPPLEMENTARY INFORMATION
For the Year Ended June 30, 2013
(dollar amounts expressed in thousands)
Governmental
Fund Types Enterprise Fund
Actual Budgetary Types Actual Total Actual
Basis Budgetary Basis Budgetary Basis
Revenues:
Property taxes $
50,416 $
- $
50,416
Delinquent property taxes
3
-
3
Tax increment financing taxes
376
-
376
Other city taxes
11,217
-
11,217
Licenses and permits
1,777
7
1,784
Intergovernmental
19,033
36,641
55,674
Charges for services
3,826
37,026
40,852
Use of money and property
827
1,178
2,005
Miscellaneous
4,058
1,649
5,707
Total revenues
91,533
76,501
168,034
Expenditures/Expenses:
Public safety
20,256
-
20,256
Public works
6,732
-
6,732
Health and social services
293
-
293
Culture and recreation
12,171
-
12,171
Community and economic development
10,158
-
10,158
General government
7,078
-
7,078
Debt service
19,170
-
19,170
Capital outlay
21,665
-
21,665
Business type
-
89,618
89,618
Total expenditures/expenses
97,523
89,618
187,141
Excess (deficiency) of revenues over
(under) expenditures /expenses
(5,990)
(13,117)
(19,107)
Other financing sources and uses, net
(4,792)
10,426
5,634
Net change in fund balances
(10,782)
(2,691)
(13,473)
Balances, beginning of year
76,966
86,975
163,941
Balances, end of year
66,184
84,284
150,468
See Note to Required Supplementary Information.
41:7
Amounts
Final to Actual
Variance -
Positive
Original Final (Negative)
$ 50,407 $
50,407 $
9
7,718
7,763
3
507
507
(131)
11,032
11,107
110
1,440
1,440
344
38,627
73,396
(17,722)
41,067
40,549
303
1,535
2,050
(45)
3,772
5,285
422
148,387
184,741
(16,707)
21,450
21,579
1,323
7,718
7,763
1,031
291
293
-
12,685
13,032
861
7,218
15,388
5,230
7,619
7,544
466
20,226
20,326
1,156
25,724
84,671
63,006
67,004
98,683
9,065
169,935 269,279 82,138
(21,548) (84,538) 65,431
11,946 15,603
(9,602) (68,935) 55,462
107,619 163,941
98,017 95,006
PIA
CITY OF IOWA CITY
BUDGETARY COMPARISON SCHEDULE
BUDGET TO GAAP RECONCILIATION
REQUIRED SUPPLEMENTARY INFORMATION
For the Year Ended June 30, 2013
(dollar amounts expressed in thousands)
Governmental Fund Types
Accrual Modified Accrual
Budget Basis Adjustments Basis
Revenues $
91,533 $
1,582 $
93,115
Expenditures
97,523
(3,202)
94,321
Net
(5,990)
4,784
(1,206)
Other financing sources (uses)
(4,792)
(1,521)
(6,313)
Beginning Fund Balances $
76,966 $
(2,568) $
74,398
Ending Fund Balances $
66,184 $
695 $
66,879
Enterprise Fund Types
Accrual Accrual
Budget Basis Adjustments Basis
Revenues $
76,501 $
(26,330) $
50,171
Expenditures
89,618
(39,273)
50,345
Net
(13,117)
12,943
(174)
Other financing sources (uses)
10,426
33,974
44,400
Beginning Fund Balances
86,975 $
204,480
291,455
Ending Fund Balances $
84,284 $
251.397 $
335,681
See Note to Required Supplementary Information.
fUIf]
City of Iowa City, Iowa
Note to Required Supplementary Information - Budgetary Reporting
For the Year Ended June 30, 2013
In accordance with Code of Iowa, the City Council annually adopts a budget following required public
notice and hearing which includes all funds, except internal service funds and agency funds. The budget
basis of accounting is cash basis. The annual budget may be amended during the year utilizing similar
statutorily prescribed procedures.
Formal and legal budgetary control is based upon nine major classes of expenditures known as functions,
not by fund or fund type. These nine functions are: public safety, public works, health and social
services, culture and recreation, community and economic development, general government, debt
service, capital outlay and business -type. The legal level control is at the aggregated function level, not at
the fund or fund type level.
During the year, budget amendments increased budgeted revenues by $36,354,000 and expenditures by
$99,344,000. The budget amendments were primarily due to changes in the breadth and timing of capital
improvement projects, which the City budgets in full during the initial year of the projects and amends
future year budgets for carryover. Additional amendments are related to flood recovery and mitigation
costs and the associated grants from flooding in the summer of 2008.
101
City of Iowa City, Iowa
Note to Required Supplementary Information — Schedule of Funding Progress for Health and
Dental Plans
For the Year Ended June 30, 2013
KIN
UAAL As a
Actuarial
Actuarial
Actuarial
Percentage of
Valuation
Fiscal Value of
Accrued
Unfunded AAL
Funded
Covered
Date
Year Assets
Liability (AAL)
(UAAL)
Ratio
Covered Payroll
Payroll
July 1, 2008
June 30, 2009 $ -
$ 15,235,196
$ 15,235,196
0.00%
$ 29,842,842
51.1%
July 1, 2010
June 30, 2011 $ -
$ 6,893,438
$ 6,893,438
0.00%
$ 31,505,702
21.9%
July 1, 2012
June 30, 2013 $ -
$ 7,163,715
$ 7,163,715
0.00%
$ 34,992,423
20.5%
KIN
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special Revenue Funds account for revenues derived from specific sources that are required to be
accounted for as separate funds. The funds in this category and their purpose are as follows:
Economic Development Fund — accounts for revenue and expenditures of economic development
activities.
Metropolitan Planning Organization of Johnson County (formerly Johnson County Council of
Governments) Fund — accounts for the financial activities of the metropolitan/rural cooperative planning
organization.
CAPITAL PROJECT FUND
Capital Projects Funds are utilized to account for all resources used in the acquisition and construction of
capital facilities and other major fixed assets, with the exception of those that are financed by proprietary
fund monies. The fund in this category is as follows:
Bridge, Street, and Traffic Control Construction Fund — accounts for the construction or replacement
of infrastructure fixed assets, such as streets, bridges, dams, sidewalks, and lighting systems.
103
CITY OF IOWA CITY
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 2013
(amounts expressed in thousands)
Liabilities and Nand Balances
Liabilities:
Accounts payable $
265 $
2 $
Capital
656
Contracts payable
Special Revenue
Projects
1,757
1,757
Accrued liabilities
Metropolitan
Bridge,
9
19
Deferred revenue
Planning
Street, and
1,989
2,309
Liabilities payable from restricted asset:
Organization
Traffic
Economic
of Johnson
Control
1
1
Development
County
Construction
Total
Assets
Fund balances:
Equity in pooled cash and investments
$ 267
$ 142
$ 7,717 $
8,126
Receivables:
Unassigned
(26)
-
(597)
Property tax
277
-
-
277
Due from other governments
-
45
3,207
3,252
Assets held for resale
-
-
165
165
Restricted assets:
Equity in pooled cash and investments
-
-
1
1
Total assets
$ 544
$ 187
$ 11,090 $
11,821
Liabilities and Nand Balances
Liabilities:
Accounts payable $
265 $
2 $
389 $
656
Contracts payable
-
-
1,757
1,757
Accrued liabilities
-
10
9
19
Deferred revenue
275
45
1,989
2,309
Liabilities payable from restricted asset:
Deposits
-
-
1
1
Total liabilities
540
57
4,145
4,742
Fund balances:
Restricted
30
130
7,542
7,702
Unassigned
(26)
-
(597)
(623)
Total fund balances
4
130
6,945
7,079
Total liabilities and fund balances $
544 $
187 $
11,090 $
11,821
111MI
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Expenditures
141
Current:
Capital
Public works
- - 1,509 1,509
Special Revenue
Projects
development
547 638 - 1,185
Capital outlay
Metropolitan
Bridge,
547 638 6,946 8,131
13,085
Transfers out
Planning
Street, and
(763)
(857)
Total other financing sources
Organization
Traffic
Economic
of Johnson
Control
11,959
12,228
Development
County
Construction
Total
Revenues
Property taxes
$ 656
$ -
$ 288
$ 944
Intergovernmental
-
252
1,861
2,113
Charges for services
-
-
57
57
Use of money and property
-
-
10
10
Miscellaneous
32
14
3
49
Total revenues
688
266
2,219
3,173
Expenditures
141
Current:
(4,727)
Public works
- - 1,509 1,509
Community and economic
development
547 638 - 1,185
Capital outlay
- - 5,437 5,437
Total expenditures
547 638 6,946 8,131
Excess (deficiency) of revenues over
(under) expenditures
141
(372)
(4,727)
(4,958)
Other Financing Sources (Uses)
Transfers in
36
327
12,722
13,085
Transfers out
(94)
-
(763)
(857)
Total other financing sources
and (uses)
(58)
327
11,959
12,228
Net change in fund balances
83
(45)
7,232
7,270
Fund Balances, Beginning (79) 175 (287) (191)
Fund Balances, Ending $ 4 $ 130 $ 6,945 $ 7,079
fUlll
itill
NONMAJOR ENTERPRISE FUNDS
Enterprise Funds account for operations and activities of the City that are financed and operated in a manner
similar to a private business enterprise, and where the costs of providing services to the general public on a
continuing basis are expected to be financed or recovered primarily through user charges, or where the City has
decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for
capital maintenance, public policy, management control, accountability, or other purposes. The funds in this
category are as follows:
Airport Fund — accounts for the operation and maintenance of the airport facility.
Stormwater Fund — accounts for the operation and maintenance of the stormwater operation.
Cable Television Fund — accounts for the operation and maintenance of the Broadband Telecommunications
Commission that oversees the franchise agreement with the cable television company, including production and
broadcasting on the government television channels.
Km
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF NET POSITION
NONMAJOR ENTERPRISE FUNDS
June 30, 2013
(amounts expressed in thousands)
Liabilities
Cable
Current liabilities:
Airport
Stormwater
Television
Total
Assets
96
21
117
234
Current assets:
778
47
-
825
Equity in pooled cash and investments
$ 570
$ 1,763
$ 1,593
$ 3,926
Receivables:
2
-
17
19
Accounts and unbilled usage
-
100
181
281
Interest
-
1
2
3
Due fmm other governments
777
14
-
791
Total current assets
1,347
1,878
1,776
5,001
Noncurrent assets:
860
-
-
860
Restricted assets:
2
-
13
15
Equity in pooled cash and investments
109
-
116
225
Other post employment benefits asset
7
-
-
7
Capital assets:
1,748
77
167
1,992
Land
7,244
2,167
-
9,411
Buildings
4,930
-
731
5,661
Improvements other than buildings
357
-
-
357
Machinery and equipment
281
259
110
650
Infrastructure
12,460
38,379
-
50,839
Accumulated depreciation
(5,018)
(9,895)
(386)
(15,299)
Construction in progress
4,153
1,865
-
6,018
Total noncurrent assets
24,523
32,775
571
57,869
Total assets
25,870
34,653
2,347
62,870
Liabilities
Current liabilities:
Accounts payable
96
21
117
234
Contracts payable
778
47
-
825
Accrued liabilities
1
3
10
14
Employee vested benefits
2
-
17
19
Total current liabilities
877
71
144
1,092
Noncurrent liabilities:
Liabilities payable from restricted assets:
Deposits
9
-
-
9
Advances from other funds
860
-
-
860
Employee vested benefits
2
-
13
15
Other post employment benefits obligation
-
6
10
16
Total noncurrent liabilities
871
6
23
900
Total liabilities
1,748
77
167
1,992
Net Position
Net investment in capital assets
24,407
32,775
455
57,637
Restricted for future improvements
100
-
-
100
Unrestricted
(385)
1,801
1,725
3,141
Total net position
$ 24,122 $
34,576 $
2,180 $
60,878
1181:3
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF REVENUES, EXPENSES,
AND CHANGES IN FUND NET POSITION
NONMAJOR ENTERPRISE FUNDS
Operating Revenues:
Charges for services
Miscellaneous
Total operating revenues
Operating Expenses:
Personal services
Commodities
Services and charges
Depreciation
Total operating expenses
Operating income (loss)
Nonoperating Revenues (Expenses):
Gain (loss) on disposal of capital assets
Operating grants
Interest income
Total nonoperating revenues (expenses)
Income (loss) before capital contributions
and transfers
Capital contributions
Transfers in
Transfers out
Change in net position
Net Position, Beginning, as restated
Net Position, Ending
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Cable
Airport Stormwater Television Total
$ 314 $ 974 $ 816 $ 2,104
1 1
314 975 816 2,105
67
200
522
789
25
177
9
211
246
201
139
586
338
578
670
1,586
757
744
34
1,535
1,095
1,322
704
3,121
(781) (347) 112 (1016)
293
-
293
11
13
-
24
1
3
4
304
14
3
321
(477) (333) 115 (695)
2,452 226 - 2,678
465 2,083 - 2,548
(57) (598) (55) (710)
2,383 1,378 60 3,821
21,739 33,198 2,120 57,057
$ 24,122 $ 34,576 $ 2,180 $ 60,878
1181*]
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR ENTERPRISE FUNDS
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Cash Flows From Operating Activities
Receipts from customers and users
Payments to suppliers
Payments to employees
Net cash flows from operating activities
Cash Flows From Noncapital Financing Activities
Operating grants received
Transfers from other funds
Transfers to other funds
Repayment of advances from other funds
Net cash flows from noncapital financing activities
Cash Flows From Capital and Related Financing
Activities
Capital grants received
Acquisition and construction of property and equipment
Proceeds from sale of property
Net cash flows from capital and related financing
activities
Cash Flows From Investing Activities
Interest on investments
Net increase (decrease) in cash and cash equivalents
Cash and Cash Equivalents, Beginning
Cash and Cash Equivalents, Ending
Reconciliation of operating income (loss) to net
cash flows from operating activities:
Operating income (loss)
Adjustments to reconcile operating income (loss) to
net cash flows from operating activities:
Depreciation expense
Changes in:
Receivables:
Accounts and unbilled usage
Accounts payable
Accrued liabilities
Employee vested benefits
Deposits
Other post employment benefits assettobligation
Total adjustments
Net cash flows from operating activities
Noncash lnvesting, Capital, and Financing Activities:
Contributions of capital assets from government and others
Cable
Airport Stormwater Television Total
$ 315 $
971 $
822 $
2,108
(180)
(369)
(145)
(694)
(66)
(202)
(518)
(786)
69
400
159
628
(2)
(D
(3)
465
2,083
- 2,548
(57)
(598)
(55) (710)
(279)
-
- (279)
127
1,484
(55) 1,556
2,273 - - 2,273
(2,855) (865) - (3,720)
313 - 4 317
(269) (865) 4 (1,130)
2 1 4 7
(71) 1,020 112 1,061
750 743 1,597 3,090
$ 679 $ 1,763 $ 1,709 $ 4,151
$ (781) $ (347) $ 112 $ (1,016)
757 744 34 1,535
$ - $ 226 $ - $ 226
110
(4)
6
2
91
9
3
103
(D
1
(2)
(2)
1
1
1
1
3
5
850
747
47
1,644
$ 69 $
400 $
159 $
628
$ - $ 226 $ - $ 226
110
INTERNAL SERVICE FUNDS
Internal Service Funds account for goods and services provided by one department to other City departments
on a cost - reimbursement basis. The funds in this category are:
Equipment Maintenance Fund — accounts for the provision of maintenance for City vehicles and
equipment and vehicle rental to other City departments from a central vehicle pool.
Central Services Fund — accounts for the support services of photocopying, paper supplies, mail, overnight
shipping, and two -way radios provided to other City departments.
Loss Reserve Fund — accounts for the property, liability, Workers' Compensation and health insurance
premiums and claims activity for City departments, including the self - insured retention portion.
Information Technology Fund — accounts for the accumulation and allocation of costs associated with
telecommunications and data processing, including the operation and replacement of equipment.
111
CITY OF IOWA CITY
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
June 30, 2013
(amounts expressed in thousands)
Liabilities
Current liabilities
Accounts payable
Equipment
Central
Loss
Information
633
Accrued liabilities
Maintenance
Services
Reserve
Technology
Total
Assets
31
1
3
28
63
Current assets:
497
3
2,293
73
2,866
Equity in pooled cash and investments
$ 8,839 $
762
$ 12,503
$ 2,842 $
24,946
Receivables:
24
1
3
23
51
Accounts and unbilled usage
-
-
1,190
-
1,190
Interest
8
1
11
3
23
Due from other governments
100
-
-
1
101
Inventories
659
-
-
-
659
Total current assets
9,606
763
13,704
2,846
26,919
Noncurrent assets:
Other post employment benefits asset
-
-
24
-
24
Capital assets:
Land
45
-
-
-
45
Buildings
578
-
-
243
821
Improvements other than buildings
50
-
-
-
50
Machinery and equipment
15,041
214
24
1,939
17,218
Infrastructure
-
31
-
1,577
1,608
Accumulated depreciation
(10,129)
(199)
(14)
(2,220)
(12,562)
Construction in progress
99
420
-
-
519
Total noncurrent assets
5,684
466
34
1,539
7,723
Total assets
15,290
1,229
13,738
4,385
34,642
Liabilities
Current liabilities
Accounts payable
451
1
155
26
633
Accrued liabilities
15
1
2,135
19
2,170
Employee vested benefits
31
1
3
28
63
Total current liabilities
497
3
2,293
73
2,866
Noncurrent liabilities:
Employee vested benefits
24
1
3
23
51
Other post employment benefits obligation
6
4
-
65
75
Total noncurrent liabilities
30
5
3
88
126
Total liabilities
527
8
2,296
161
2,992
Net Position
Net investment in capital assets 5,684 466 10 1,539 7,699
Unrestricted 9,079 755 11,432 2,685 23,951
Total net position $ 14,763 $ 1,221 $ 11,442 $ 4,224 $ 31,650
112
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF REVENUES, EXPENSES,
AND CHANGES IN FUND NET POSITION
INTERNAL SERVICE FUNDS
Operating Revenues:
Charges for services
Miscellaneous
Total operating revenues
Operating Expenses:
Personal services
Commodities
Services and charges
Depreciation
Total operating expenses
Operating income (loss)
Nonoperating Revenues (Expenses):
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Equipment Central Loss Information
Maintenance Services Reserve Technology Total
$ 5,563 $ 232 $ 10,390 $ 1,839 $ 18,024
7 - 3 4 14
5,570 232 10,393 1,843 18,038
869
30
255
958
2,112
2,392
2
188
147
2,729
361
172
7,978
516
9,027
3,622
204
8,421
1,621
13,868
1,244
25
3
265
1,537
4,866
229
8,424
1,886
15,405
704 3 1,969 (43) 2,633
Gain (loss) on disposal of capital assets 237 - - (22) 215
Operating grants - - - 1 1
Interest income 21 2 28 8 59
Total nonoperating revenues (expenses) 258 2 28 (13) 275
Income (loss) before capital contributions
and transfers 962 5 1,997 (56) 2,908
Capital contributions
3
- -
20
23
Transfers in
223
420 -
163
806
Change in net position
1,188
425 1,997
127
3,737
Net Position, Beginning
13,575
796 9,445
4,097
27,913
Net Position, Ending
$ 14,763 $
1,221 $ 11,442 $
4,224 $
31,650
113
CITY OF IOWA CITY, IOWA
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
Cash Flows From Operating Activities
Receipts from customers and users
Payments to suppliers
Payments to employees
Net cash flows from operating activities
Cash Flows From Noncapital Financing
Activities
Transfers from other funds
Net cash flows from noncapital financing
activities
Cash Flows From Capital and Related
Financing Activities
Acquisition and construction of property
and equipment
Proceeds from sale of property
Net cash flows from capital and related
financing activities
Cash Flows From Investing Activities
Interest on investments
Net increase in cash and cash
equivalent%
Cash and Cash Equivalents, Beginning
Cash and Cash Equivalents, Ending
Reconciliation of operating income (loss)
to not cash Bows from operating activities:
Operating income (loss)
Adjustments to reconcile operating income
(loss) to net cash flows from operating
activities:
Depreciation expense
Changes in:
Receivables:
Accounts and unbilled usage
Due from odder governments
Inventories
Accounts payable
Accrued liabilide%
Employee vested benefit%
Other post employment benefits
asset/obligation
Total adjustment%
Net cash flows from operating activities
Nonrash Investing, Capital, and Financing
Activities:
Contributions of capital assets from
government and others
Contributions of capital assets to
government and others
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Equipment
Maintenance
Central
service.%
Loss
Reserve
Information
Technology
Total
$ 5,563 $
232
$ 9,203
$ 1,843 $
16,841
(2,711)
(173)
(8,698)
(680)
(12,262)
(865)
(28)
(25)
(938)
(1,856)
1,987
31
480
225
2,723
226 420 163 809
226 420 163 809
(1,786)
254
(425)
2
(5) (269)
(22)
(2,485)
234
(1,532)
(423)
(5) (291)
(2,251)
29 2 42 II 84
710
8.129
30
732
517
11,986
108
2,734
1,365
23,581
$ 8.839 $
762 $
12.503 $
2,842 $
24,946
$ 704 $ 3 $ 1,969 $ (43) $ 2,633
1,244 25 3 265 1,537
(1,190) - (1,190)
(7) (7)
(169) - - - (169)
211 1 (532) (17) (337)
1 1 229 1 232
(6) 7 1
9 1 1 12 23
1,283 28 (1,489) 268 90
$ 1,987 $ 31 $ 480 $ 225 $ 2,723
$ 3
$
- $
- $
20
$
23
$ -
$
- $
- $
22
$
22
114
AGENCY FUNDS
The Agency Funds account for assets held by the City in a trustee or custodial capacity for other entities,
such as individuals, private organizations, or other governmental units. The funds in this category are:
Project Green Fund — accounts for donations that are received to plant and develop yards and lawns, both
public and private, within Iowa City.
Library Foundation — accounts for donations that are made to support the library development office.
115
CITY OF IOWA CITY
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
AGENCY FONDS
For the Year Ended June 30, 2013
(amounts expressed in thousands)
Balance Balance
July 1, 2012 Increases Decreases June 30, 2013
Project Green
Assets
Equity in pooled cash and investments $ 204 $ 68 $ 127 $ 145
Interest receivable 1 - 1 -
Total assets $ 205 $ 68 $ 128 $ 145
Liabilities
Accounts payable $ - $ 6 $ - $ 6
Due to agency $ 205 $ 62 $ 128 $ 139
Total liabilities $ 205 $ 68 $ 128 $ 145
Library Foundation
Assets
Equity in pooled cash and investments $ - $ 9 $ 9 $ -
Accounts receivable 9 - 9 -
$ 9 $ 9 $ 18 $
Liabilities
Accrued liabilities $ 9 $ - $ 9 $
Total liabilities $ 9 $ - $ 9 $ -
Total Agency Funds
Assets
Equity in pooled cash and investments
$
204
$
77
$
136
$
145
Accounts receivable
9
-
9
-
Interest receivable
1
-
1
-
Total assets
$
214
$
77
$
146
$
145
Liabilities
Accounts payable
$
-
$
6
$
-
$
6
Accrued liabilities
$
9
$
-
$
9
$
-
Due to agency
205
62
128
139
Total liabilities
$
214
$
68
$
137
$
145
loll
Statistical Section
This part of the City of Iowa City's comprehensive annual financial report represents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the government's overall
financial health.
Contents
Page
Financial Trends 119
These schedules contain trend information to help the reader understand how
the government's financial performance and well -being have changed over
time.
Revenue Capacity 124
These schedules contain information to help the reader assess the
government's most significant local revenue source, the property tax.
Debt Capacity 134
These schedules present information to help the reader assess the
affordability of the government's current levels of outstanding debt and the
government's ability to issue additional debt in the future.
Demographic and Economic Information 144
These schedules offer demographic and economic indicators to help the
reader understand the environment within which the government's financial
activities take place.
Operating Information 146
These schedules contain service and infrastructure data to help the reader
understand how the information in the government's financial report relates
to the services the government provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial report for the relevant year. The city implemented GASB 34 in FY03; schedules
presenting government -wide information include information beginning in that year.
117
118
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CITY OF IOWA CITY, IOWA
PROPERTY TAX BUDGETS AND COLLECTIONS
Last Ten Fiscal Years
(Cash basis of accounting)
(amounts expressed in thousands)
127
Percent of
Total as
Collection Total Tax Current Tax
Levy
Delinquent Tax
Total Tax
a Percent of
Year Levied Collections
Collected
Collections
Collections
Lev
2004 $ 34,073 $ 34,009
99.8 % $ 23 $
34,032
99.9 %
2005 34,403 34,814
101.2
15
34,829
101.2
2006 36,460 36,654
100.5
44
36,698
100.7
2007 39,094 38,947
99.6
13
38,960
99.7
2008 39,973 39,768
99.5
70
39,838
99.7
2009 43,168 43,118
99.9
18
43,136
99.9
2010 45,393 45,318
99.8
17
45,335
99.9
2011 47,789 47,826
100.1
8
47,834
100.1
2012 49,595 49,543
99.9
1
49,544
99.9
2013 50,407 50,139
99.5
3
50,142
99.5
Source: Certificate of City Taxes and Johnson County
Treasurer's Office
Note: This schedule is presented on a cash basis of
accounting.
Taxes are collected by the
Johnson County Treasurer and
submitted to the City in the following month. Because of the month delay, some years will
show Current Tax
Collections in
excess of the Total Tax Levied.
I Delinquent tax collection is presented by collection year, rather than levy year, because
information is not available from
Johnson County Treasurer by levy year.
127
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CITY OF IOWA CITY, IOWA
SALES HISTORY AND TOTAL WATER CHARGES
Last Ten Fiscal Years
Fiscal
Water Sales
Water System
Year
Cubic Feet Sold
Char¢es
2004
253,454,012
$ 8,850,608
2005
254,560,239
8,315,719
2006
267,107,998
8,844,993
2007
261,072,632
8,414,310
2008
249,361,929
7,976,536
2009
234,804,167
7,497,903
2010
234,342,825
7,568,378
2011
236,838,370
7,661,898
2012
246,618,257
7,953,738
2013
254,616,773
8,194,467
Sources:
City of Iowa City Revenue Department
131
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CITY OF IOWA CITY, IOWA
SALES HISTORY AND TOTAL SEWER CHARGES
Last Ten Fiscal Years
Fiscal
Sewer Sales
Sewer System
Year
Cubic Feet Sold
Char¢es
2004
294,683,685
$ 12,482,393
2005
297,714,953
12,557,646
2006
302,925,357
12,373,762
2007
315,199,203
11,084,369
2008
285,492,596
12,221,769
2009
276,455,246
12,499,949
2010
265,375,857
12,541,905
2011
280,303,237
12,748,695
2012
282,134,840
12,784,321
2013
285,472,392
12,883,641
Sources:
City of Iowa City Revenue Department
133
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CITY OF IOWA CITY, IOWA
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR
GENERAL BONDED DEBT TO TOTAL GENERAL GOVERNMENTAL EXPENDITURES'
gist Ten Fiscal Years
(amounts expressed in thousands)
0611
Ratio of Debt
Service to General
Expenditures
Total
1.00
.15:
1.00
.10:
General
Fiscal Year
1.00
.11 :
1.00
Governmental
Ended
.11 :
1.00
Total
Expenditures
June 30
Principal Z
Interese
Debt Service
and Transfers
2004
$ 5,172
$ 3,336 $
8,508 $
83,445
2005
9,349
3,676
13,025
88,342
2006
6,099
3,458
9,557
93,360
2007
6,700
3,464
10,164
93,639
2008
7,323
3,556
10,879
99,178
2009
8,418
3,364
11,782
102,607
2010
9,354
3,064
12,418
108,950
2011
10,386
2,889
13,275
120,424
2012
13,294
2,543
15,837
119,242
2013
16,465
2,339
18,804
129,814
Notes:
I General Fund, Special Revenue Funds, Debt Service Fund
and Capital Projects Funds.
2 Beginning in FY 13,
Taxable Urban Renewal
Revenue Bonds
are also included.
0611
Ratio of Debt
Service to General
Expenditures
.10:
1.00
.15:
1.00
.10:
1.00
.11 :
1.00
.11 :
1.00
.11 :
1.00
.11 :
1.00
.11 :
1.00
.13:
1.00
.14:
1.00
Name of
Governmental Unit
City of Iowa City
Iowa City Community
School District
Total
Per capita assessed value
CITY OF IOWA CITY, IOWA
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
June 30, 2013
(amounts expressed in thousands, except per capita)
Total General
Long -Term
Direct Debt
Outstanding
$ 60,514
15,165
$ 75,679
Source: Johnson County Auditor's Office.
Percent
Applicable
to the City of
Iowa City
100.00 % $
Amount
Applicable
to the City of
Iowa City
60,514 $
Per Capita
862.8527
58.38 8,853 126.2288
$ 69,367 $ 989.0815
$ 65,811
Note: Overlapping governments are those that coincide,
at least in part, with the geographic boundaries of
the City.
This schedule estimates the portion of the outstanding
debt of those
overlapping governments that is borne by the
residents and businesses of Iowa City. This process recognizes
that,
when considering the City's ability
to issue
and repay long -term debt, the entire burden borne by
the residents
and businesses should be taken into
account.
However, this does not imply that every taxpayer is a
resident, and
therefore responsible for repaying the
debt, of
each overlapping government.
137
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CITY OF IOWA CTTY, IOWA
SCHEDULE OF REVENUE BOND COVERAGE
Last Ten Fiscal Years
(amounts expressed in thousands)
ISscal
Year
Ended
June 30
Revenue
Expcnseti
Net Revenue
Available for
Debt Service Principal
Parking Rcvcnuc'
Annual Debt Service
Interest Total
Ratio of
Coveraec
2004
$ 4,164
$ 2,319
$ 1,945
$ 395
$ 697
$ 1,092
1.71
2005
4,360
2,377
1,993
305
663
969
2.05
2006
4,161
2,390
1,791
320
645
965
1.95
2007
5,035
2,973
2,062
335
626
961
2.15
2009
4,995
2,454
2,541
355
606
961
2.64
2009
5,630
3,024
2,606
370
594
954
2.73
2010°
5,509
3,149
2,360
390
504
994
2.64
2011
5,399
2,920
2,469
420
391
911
3.04
2012
4,945
3,034
1,911
500
339
939
2.29
2013
5,122
3,549
1,573
515
324
939
1.97
Wastewater Treatment Rcvcnuc°
2004
$ 12,947 $
4,523 $
9,424 $
3,290 $
3,672
$ 6,952
1.21
2005
12,60(1
4,432
9,169
3,630
3,537
7,167
1.14
2006
12,799
4,260
9,539
3,915
3,390
7,205
1.19
2007
13,709
4,236
9,472
3,905
3,234
7,139
1.33
20096
13,332
4,591
9,751
4,105
3,071
7,176
1.22
20096
13,462
5,202
9,260
4,260
2,913
7,073
1.17
2010°
13,174
5,050
9,124
4,205
2,307
6,512
1.25
20116
13,291
5,477
7,904
1,940
2,054
3,994
2.00
2012
13,175
5,663
7,512
4,615
1,693
6,309
1.19
2013
13,301
5,340
7,961
4,965
1,547
6,412
1.24
Water Revenues
2004
$ 10,627 $
4,360 $
6,267 $
925 $
1,427
$ 2,352
2.66
2005
9,297
4,793
4,504
945
1,340
2,195
2.06
2006
9,919
5,722
4,196
990
1,305
2,195
1.92
2007
9,220
5,356
3,964
915
1,269
2,193
1.77
20096
9,259
5,349
3,910
955
1,229
2,194
1.79
20096
9,933
5,726
3,107
995
1,171
2,166
1.43
2010°
9,336
5,153
3,193
690
1,055
1,735
1.93
2011
9,354
5,464
2,990
1,110
902
2,012
1.44
2012°
9,649
5,653
2,996
1,200
961
2,061
1.45
20136
9,342
6,349
2,994
945
759
1,603
1.97
Notes:
Excludes depreciation and interest.
2 Includes principal and interest of revenue bonds only.
a Parking Revenue bonds ratio of "Net Revenue Available for Debt Service' to "Total Annual Debt Service'
is required to be at least 1.25.
° Wastewater Treatment Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total
Annual Debt Service" is required to be at least 1.10.
5 Water Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total Annual Debt Service"
is required to be at least 1.10.
Refunded Revenue Bonds paid are excluded from the principal of Annual Debt Service.
140
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Fiscal Year
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Total
Fiscal Year
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
Total
CITY OF IOWA CITY, IOWA
REVENUE DEBT ANNUAL MATURITY BY FUNDING SOURCE
Principal
$ 515,000
530,000
540,000
560,000
580,000
605,000
625,000
650,000
680,000
705,000
735,000
770,000
Parking
Outstanding
Interest
$ 323,975
308,300
292,250
272,950
250,150
226,450
201,850
176,350
148,900
119,469
88,869
54,000
Total
$ 838,975
838,300
832,250
832,950
830,150
831,450
826,850
826,350
828,900
824,469
823,869
824,000
695,000 17375 712375
$ 8,190,000 $ 2,480,888 $ 10,670,888
Principal
$ 4,865,000
3,250,000
3,370,000
3,520,000
3,625,000
3,775,000
3,915,000
4,090,000
3,740,000
2,485,000
1,220,000
700,000
740,000
Sewer
Outstanding
Interest
$ 1,546,888
1,418,681
1,304,900
1,175,119
1,034,575
886,575
731,400
557,463
378,013
232,288
141,250
93,250
57,250
Total
$ 6,411,888
4,668,681
4,674,900
4,695,119
4,659,575
4,661,575
4,646,400
4,647,463
4,118,013
2,717,288
1,361,250
793,250
797,250
775,000 19,375 794,375
$ 40,070,000 $ 9,577,027 $ 49,647,027
[EN
(continued)
CITY OF IOWA CITY, IOWA
REVENUE DEBT ANNUAL MATURITY BY FUNDING SOURCE (continued)
Fiscal Year
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
Total
Principal
$ 845,000
1,335,000
1,380,000
1,420,000
1,465,000
1,520,000
1,565,000
1,620,000
1,680,000
1,740,000
1,805,000
1,325,000
1,390,000
Water
Outstanding
Interest
$ 757,529
649,946
609,515
567,215
522,946
475,903
426,515
374,103
317,571
256,781
191,764
128,847
68,481
Total
$ 1,602,529
1,984,946
1,989,515
1,987,215
1,987,946
1,995,903
1,991,515
1,994,103
1,997,571
1,996,781
1,996,764
1,453,847
1,458,481
835,000 18,788 853,788
$ 19,925,000 $ 5,365,904 $ 25,290,904
Fiscal Year Principal
2013 $
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Total
Taxable Urban Renewal
130,000
130,000
135,000
135,000
140,000
140,000
145,000
150,000
150,000
155,000
160,000
165,000
170,000
175,000
185,000
190,000
200,000
$ 2,655,000
Outstanding
Interest Total
$ 38,086
75,335
75,335
75,335
74,035
72,345
70,185
67,485
64,545
61,325
57,845
53,945
49,745
45,095
39,975
34,365
28,245
21,770
14,925
7,800
$ 1,027,721
143
$ 38,086
75,335
75,335
205,335
204,035
207,345
205,185
207,485
204,545
206,325
207,845
203,945
204,745
205,095
204,975
204,365
203,245
206,770
204,925
207,800
$ 3,682,721
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CITY OF IOWA CITY, IOWA
FULL -TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION
Last Ten Fiscal Years
Full -Time Equivalent Employees as of June 30
2004 2(105 2006 2007 2005 2009 2010
Public Safety
Police
97.25
94.25
94.25
96.25
96.25
103.25
103.25
Animal Shelter'
6
6
6
6
6
6
6
Fire
59
56
57
57
57
57
57
Inspection Services
14.13
13.99
14.99
14.99
15.39
15.55
15.55
Public Works
Public Works Armin
2
2
2
2
2
2
2
Engineering
13.6
11.6
11.6
11.6
11.35
11.35
11.35
Flood Recovery
-
-
-
-
-
-
-
Culture and Recreation
Parks and Ree Armin
2
2
2
2
2
2
2
Recreation
15.17
15.17
15.17
15.42
15.42
15.42
15.42
Parks
13
12
13
13
13
13
13
Forestry
3
3
3
3
3
3
3
Cemetery
3
3
3
3
3
3
3
CBD Maintenance
3
3
3
3
3
3
3
Library
43.25
42.63
42.63
42.99
43.14
43.14
43.14
Senior Center
5.91
6.31
6.31
6.31
6.31
6.31
6.31
Community and Economic Development
9.45
9.45
9.45
9.45
9.95
9.05
9.05
General Government
City Council
7
7
7
7
7
7
7
City Clerk
4
4
4
4
4
4
4
City Attorney
6.6
6.6
6.6
6.6
6.6
6
6
City Manager'
3
3
3
3
3
3
3
Personnel
4
4
4
4
4
4
4
Human Rights
2.5
2.5
2.5
2.5
2.5
2.5
2.5
Finance
29.61
26.61
26.75
26.75
26.5
26.3
26.3
Government Buildings
4.96
4.96
4.96
4.96
4.96
4.96
4.96
Energy Conservation
0.5
0.5
0.5
0.5
0.25
0.25
0.25
Transit'
49.5
50.5
50.5
50.5
54.75
59.5
59.5
Special Revenue
Employee Benefits
0.34
0.34
0.39
0.39
0.29
0.29
0.29
CIP /Roads
7
3
2
2
1
2
2
Flood Mitigation Grants
-
-
-
-
-
-
-
Community Development
5.35
4.35
4.35
4.35
3.99
3.99
3.99
UniverCity Program
Traffic Engineering
5.65
5.65
4.15
4.15
4.15
4.15
4.15
Streets
22
22
23.5
23.5
23.5
25.5
25.5
MPOJC (formerly JCCOG)
6.1
6.1
6.6
6.6
6.6
6.6
6.6
Other Shared Revenues
Library Development
1.5
0.9
1
1
1
1
1
Capital Project Administration
-
-
-
-
-
-
-
Intemal Service Funds
Information Technology
7.5
9
11.75
12
12.3
12.3
12.3
Equipment
11.26
11.25
11.26
11.26
11.26
11.26
11.26
Central Services
0.75
0.75
0.75
0.75
0.75
0.75
0.75
Risk Management
1.33
1.32
1.39
1.39
1.73
1.93
1.93
Business -Type Activities
Parking
31.5
32.75
32.75
32.75
32.75
33.25
33.25
Mass Transit'
Wastewater Treatment
27.3
27.3
25.5
25.5
25.5
25.6
25.6
Water
31.7
31.7
32.5
32
32.75
32.75
32.75
Sanitation
32.35
34.35
33.95
33.95
34.95
34.95
35.95
Airport
2
2
1.6
1.6
1.6
1.75
1.75
Cable Television
6.19
6.19
6.19
6.19
6.19
6.44
6.44
Stormwater
-
-
0.5
1
2
1.9
1.9
Housing Authority
12.5
12.75
13.25
13.25
13.25
13.25
13.25
Total
610.65
599.56
605.37
609.13
614.91
629.03
630.03
Source: City's Financial Plan
146
2011
2012
2013
99
97
103
6
6
0
66
65
65
15.55
15.55
15.55
2
2
2
12.1
12.1
12.1
0.4
0.4
0.4
2
2
2
15.42
15.42
15.42
13
13
13
3
3
3
3
3
3
3
3
3
43.14
43.64
43.63
6.31
6.5
6.5
9.1
9.1
9.4
7
7
7
4
4
4
5.6
5.6
5.6
3
3
5
4
4
4
2.5
2.5
2
26.24
27.53
23.47
4.96
4.93
4.93
56.25
56.25
0
0.26
0.55
0.55
1.6
1.6
3.93
3.93
3.33
0.2
4.15
4.15
4.15
25.5
25.5
25.5
6.6
6.6
5.6
1.6
1
1
1
3
5
6
11.3
11.9
10.96
11.26
11.26
10.75
0.75
0.75
0.76
2.01
1.9
1.9
32.75
32.75
29.25
51.75
25.6
25.4
25.4
32.75
32.75
32.75
35.95
37.95
37.95
1.75
1.75
1
6.69
6.63
6.63
1.9
2.1
2.1
13.25
13.25
13.19
633.37
637.74
623.91
147
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152
EideBailly.
CPAs S, BUSINESS ADVISORS
Independent Auditor's Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements Performed in
Accordance with Government Auditing Standards
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
We have audited, in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business -type activities, each major fund, and the aggregate remaining fund information of
the City of Iowa City, Iowa, (City) as of and for the year ended June 30, 2013, and the related notes to the
financial statements, which collectively comprise the City's basic financial statements, and have issued
our report thereon dated December 19, 2013.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control
over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do
not express an opinion on the effectiveness of the City's internal control.
Our consideration of internal control over financial reporting was for the limited purpose described in the
preceding paragraph and was not designed to identify all deficiencies in internal control over financial
reporting that might be material weaknesses or significant deficiencies and therefore, material weaknesses
or significant deficiencies may exist that were not identified. However, as described in the accompanying
schedule of findings and questioned costs, we identified a certain deficiency in internal control that we
consider to be a material weakness.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the City's financial statements will not be prevented, or detected and corrected on a timely basis. We
consider the deficiency described in Part II of the accompanying schedule of findings and questioned
costs as item 2013 -A to be a material weakness.
153
www.eidebailly.com
3999 Pennsylvania Ave., Ste. 100 1 Dubuque, IA 52002 -2273 1 T 563.556.1790 1 F 563.557.7642 1 EOE
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
Comments involving statutory and other legal matters about the City's operations for the year ended
June 30, 2013, are based exclusively on knowledge obtained from procedures performed during our audit
of the financial statements of the City and are reported in Part IV of the accompanying Schedule of
Findings and Questioned Costs. Since our audit was based on tests and samples, not all transactions that
might have had an impact on the comments were necessarily audited. The comments involving statutory
and other legal matters are not intended to constitute legal interpretations of those statutes.
City's Response to Finding
The City's response to the finding identified in our audit is described in the accompanying schedule of
findings and questioned costs. The City's response was not subjected to the auditing procedures applied
in the audit of the financial statements and, accordingly, we express no opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the City's internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
A,,, ,4 Z, 7°
Dubuque, Iowa
December 19, 2013
154
EideBailly.
CPAs S, BUSINESS ADVISORS
Independent Auditor's Report on Compliance for Each Major Federal Program and
Report on Internal Control over Compliance Required by OMB Circular A -133
To the Honorable Mayor and
Members of the City Council
City of Iowa City, Iowa
Report on Compliance for Each Major Federal Program
We have audited the City of Iowa City, Iowa's (City) compliance with the types of compliance
requirements described in the OMB Circular A -133 Compliance Supplement that could have a direct and
material effect on each of the City's major federal programs for the year ended June 30, 2013. The City's
major federal programs are identified in the summary of auditor's results section of the accompanying
schedule of findings and questioned costs.
Management's Responsibility
Management is responsible for compliance with the requirements of laws, regulations, contracts and
grants applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on the compliance for each of the City's major federal
programs based on our audit of the types of compliance requirements referred to above. We conducted
our audit of compliance in accordance with auditing standards generally accepted in the United States of
America; the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States; and OMB Circular A -133, Audits of States, Local
Governments, and Non - Profit Organizations. Those standards and OMB Circular A -133 require that we
plan and perform the audit to obtain reasonable assurance about whether noncompliance with the
compliance requirements referred to above that could have a direct and material effect on a major federal
program occurred. An audit includes examining, on a test basis, evidence about the City's compliance
with those requirements and performing such other procedures as we considered necessary in the
circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major
federal program. However, our audit does not provide a legal determination of the City's compliance.
Opinion on Each Major Federal Program
In our opinion, the City of Iowa City, Iowa, complied, in all material respects, with the compliance
requirements referred to above that could have a direct and material effect on each of its major Federal
programs for the year ended June 30, 2013.
155
www.eidebailly.com
3999 Pennsylvania Ave., Ste. 100 1 Dubuque, IA 52002 -2273 1 T 563.556.1790 1 F 563.557.7642 1 EOE
Report on Internal Control over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the compliance requirements referred to above. In planning and performing our audit of
compliance, we considered the City's internal control over compliance with the types of requirements that
could have a direct and material effect on each major federal program to determine the auditing
procedures that are appropriate in the circumstances for the purpose of expressing an opinion on
compliance for each major federal program and to test and report on internal control over compliance in
accordance with OMB Circular A -133, but not for the purpose of expressing an opinion on the
effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material noncompliance with a compliance requirement will not be prevented,
or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance
is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of
compliance requirement of a federal program that is less severe than a material weakness in internal
control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the fast
paragraph of this section and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control
over compliance that we consider to be material weaknesses. However, material weaknesses may exist
that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of
OMB Circular A -133. Accordingly, this report is not suitable for any other purpose.
Dubuque, Iowa
December 19, 2013
156
City of Iowa City, Iowa
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Federal Pass - Through
CFDA Entity Identifying Federal
Grantor/Program Number Number Expenditures
U.S. Department of Commerce:
Direct program:
Economic Adjustment Assistance 11.307 $ 18,803,973
Economic Adjustment Assistance 11.307 329,688
Total U.S. Department of Commerce 19,133,661
U.S. Department of Housing and Urban Development:
Direct program:
Community Development Block Grants/
Entitlement Grants
14.218
990,119
Community Development Block Grants/
Entitlement Grants
14.218
558,125
Community Development Block Grants/
Entitlement Grants
14.218
229,814
1,778058
Pass - through program from:
Iowa Economic Development Authority:
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRIIB -225
1,420,382
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRH -210
629,583
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRI -271
9,852,193
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRI -273
299,323
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRIEF -276
223,701
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRB -204
20,078
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRMH -215
345
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRIEF -274
111,464
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
14.228
08 -DRIEF -275 IC
1,008
157
City of Iowa City, Iowa
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Federal
Pass - Through
CFDA
Entity Identifying
Grantor/Program Number
Number
U.S. Department of Housing and Urban Development: (continued)
Pass - through program from: (continued)
Iowa Economic Development Authority: (continued)
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii 14.228
Community Development Block Grants/
State's Program and Non - Entitlement
Grants in Hawaii
Direct program:
Home Investment Partnerships Program
Home Investment Partnerships Program
Home Investment Partnerships Program
Home Investment Partnerships Program
Public and Indian Housing
Section 8 Housing Choice Vouchers
Public Housing Capital Fund
Public Housing Capital Fund
Public Housing Capital Fund
14.228
1: I.ul 111
lag 1:. 9=1
Federal
Expenditures
91,859
337,042
12,986,978
14.239 224,238
14.239 210,480
14.239 207,939
14.239 131,154
773,811
14.850 122,679
14.871 6,670,788
14.872 121,379
14.872 53,026
14.872 228
174,633
Total U.S. Department of Housing and Urban Development
U.S. Department of Justice:
22,506,947
Pass - through program from:
Iowa Department of Justice:
Violence Against Women Formula Grants
16.588 VW -13 -34
43,086
Direct program:
Bulletproof Vest Partnership Program
16.607
2,840
Bulletproof Vest Partnership Program
16.607
401
3,241
Public Safety Partnership and Community
Policing Grants
16.710
44,356
Pass - through program from:
Governor's Office of Drug Control Policy:
Public Safety Partnership and Community
Policing Grants
16.710 10- Hotspots /Interdiction
18,491
62,847
158
City of Iowa City, Iowa
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Federal Pass - Through
CFDA Entity Identifying Federal
Grantor/Program Number Number Expenditures
U.S. Department of Justice: (continued)
JAG Program Cluster:
Direct program:
Edward Byrne Memorial Justice
Assistance Grant Program
16.738
$ 29,087
Edward Byrne Memorial Justice
U.S. Department of Transportation:
Assistance Grant Program
16.738
24,880
Edward Byrne Memorial Justice
Airport Improvement Program 20.106
130,396
Assistance Grant Program
16.738
15,438
Pass - through program from:
2,167,646
Governor's Office of Drug Control Policy:
Edward Byrne Memorial Justice
Assistance Grant Program
16.738
10JAG -42356 64,370
133,775
Pass - through program from:
Governor's Office of Drug Control Policy:
ARRA — Recovery Act — Edward
Byrne Memorial Justice Assistance
Grant (JAG) Program/Grants to
States and Territories
16.803
10JAG -42356 32,262
Direct program
ARRA — Recovery Act — Edward Byrne
Memorial Justice Assistance Grant
(JAG) Program/Grants to Units of
Local Government 16.804 23,724
Total JAG Program Cluster
189,761
Total U.S. Department of Justice
298,935
U.S. Department of Transportation:
Direct program:
Airport Improvement Program 20.106
2,018,623
Airport Improvement Program 20.106
130,396
Airport Improvement Program 20.106
10,887
Airport Improvement Program 20.106
7,740
2,167,646
159
City of Iowa City, Iowa
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Job Access and Reverse Commute
Program
Federal
Pass - Through
31,024
Job Access and Reverse Commute
CFDA
Entity Identifying
Federal
Grantor/Program
Number
Number
Expenditures
U.S. Department of Transportation: (continued)
New Freedom Program
20.521
IA -57- X001 - 371 -12
Highway Planning and Construction Cluster:
New Freedom Program
20.521
IA -57- X009 - 371 -13
Pass - through program from:
Iowa Department of Transportation:
Total Transit Services Program Cluster
Highway Planning and Construction
20.205
STP- U- 3715(637)- -70 -52
$ 1,697,342
Highway Planning and Construction
20.205
HDP- 3715(634)- -71 -52
367,510
Highway Planning and Construction
20.205
BRM- 3715(650)- -8N -52
295,344
Highway Planning and Construction
20.205
FHWA IA08 -05
4,503
Iowa Department of Transportation and
Metropolitan Planning Organization
of Johnson County:
Highway Planning and
Construction
20.205
13MPO -MPOJC
175,000
2,539,699
Iowa Department of Transportation:
Recreational Trails Program
20.219
NRT- 3715(649)- -9G -52
389,885
Total Highway Planning and Construction
Cluster
2,929,584
Federal Transit Cluster:
Pass - through program from:
Iowa Department of Transportation:
Federal Transit— Capital Investment
Grants
20.500
IA -04- 0117 - 371 -11
739,797
Direct program:
Federal Transit — Formula Grants
20.507
1,043,854
Total Federal Transit Cluster
1,783,651
Transit Services Program Cluster:
Pass - through program from:
Iowa Department of Transportation:
Enhanced Mobility of Seniors and
Individuals with Disabilities
20.513
IA -16- X002 - 371 -13
88,992
Job Access and Reverse Commute
Program
20.516
IA -37- X022 - 371 -12
31,024
Job Access and Reverse Commute
Program
20.516
IA -37- X022 - 371 -13
92,942
123,966
New Freedom Program
20.521
IA -57- X001 - 371 -12
24,004
New Freedom Program
20.521
IA -57- X009 - 371 -13
32,148
56,152
Total Transit Services Program Cluster
269,110
160
Federal
CFDA
Grantor/Program Number
U.S. Department of Transportation: (continued)
Pass - through program from: (continued)
Iowa Department of Public Safety:
Governor's Traffic Safety Bureau:
Alcohol Impaired Driving
Countermeasures Incentive Grants I 20.601
Alcohol Impaired Driving
Countermeasures Incentive Grants I 20.601
Total U.S. Department of Transportation
U.S. Environmental Protection Agency
Direct program:
Urban Waters Small Grants 66.440
U.S. Department of Energy:
Direct program:
ARRA— Energy Efficiency and Conservation
Block Grant Program (EECBG) 81.128
U.S. Department of Homeland Security:
Pass - through program from:
Iowa Homeland Security and Emergency
Management Division:
Disaster Grants — Public Assistance
(Presidentially Declared Disasters)
Disaster Grants — Public Assistance
(Presidentially Declared Disasters)
Disaster Grants — Public Assistance
(Presidentially Declared Disasters)
Hazard Mitigation Grant
Hazard Mitigation Grant
Hazard Mitigation Grant
Total U.S. Department of Homeland Security
Total
97.036
97.036
97.036
97.039
97.039
97.039
See Notes to the Schedule of Expenditures of Federal Awards
161
City of Iowa City, Iowa
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Pass - Through
Entity Identifying
Number
PAP 13 -410, Task 30
PAP 12 -410, Task 41
FEMA -1763 DR -IA
FEMA DR- 4119 -IA
FEMA DR- 4126 -IA
DR- 1763 - 0137 -01
HMGP -DR- 1854 -0006 01
FEMA -DR- 1763 -0015 01
Federal
Expenditures
$ 19,463
6,338
25,801
7.175.792
9,709
23,419
475,304
49,993
49,732
575,029
275,515
104,046
1,035
380,596
955,625
$ 50,104,088
City of Iowa City, Iowa
Notes to the Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
Note 1 - Basis of Presentation
The accompanying schedule of expenditures of federal awards includes the federal grant activity of the City of
Iowa City, Iowa, and is presented on the modified accrual basis of accounting for governmental funds and the full
accrual basis of accounting for proprietary funds. The information in this schedule is presented in accordance with
the requirements of OMB Circular A -133, Audits of States, Local Governments, and Non -Profit Organizations.
The City received federal awards both directly from federal agencies and indirectly through pass - through entities.
Federal financial assistance provided to a subrecipient is treated as an expenditure when it is paid to the
subrecipient.
Note 2 - Subrecipients
Of the federal expenditures presented in the accompanying schedule of expenditures of federal awards, the City
provided federal awards to subrecipients as follows:
Federal
Amount
CFDA
Provided to
Program Title Number
Subrecipients
Community Development Block Grants /Entitlement Grants 14.218 $ 1,102,570
Home Investment Partnerships Program 14.239 539,903
Public Safety Partnership and Community Policing Grants 16.710 7,738
Edward Byrne Memorial Justice Assistance Grant Program 16.738 70,910
ARRA — Recovery Act — Edward Byrne Memorial Justice
Assistance Grant (JAG) Program/Grants to States and Territories 16.803 19,998
New Freedom Program 20.521 56,152
162
City of Iowa City, Iowa
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Part I: Summary of the Independent Auditor's Results:
Financial Statements
Type of auditor's report issued Unmodified
Internal control over financial reporting:
Material weaknesses identified Yes
Significant deficiencies identified not
considered to be material weaknesses None reported
Noncompliance material to financial statements noted? No
Federal Awards
Internal control over major programs:
Material weaknesses identified No
Significant deficiencies identified not
considered to be material weaknesses None reported
Type of auditor's report issued on compliance for major programs: Unmodified
Any audit findings disclosed that are required to be reported in
accordance with OMB Circular A -133 §.510(a): No
Identification of major programs
Name of Federal Program CFDA Number
Economic Adjustment Assistance 11.307
Community Development Block Grants /Entitlement Grants 14.218
JAG Cluster
Edward Byrne Memorial Justice Assistance Grant Program
16.738
ARRA — Recovery Act — Edward Byrne Memorial Justice
Assistance Grant (JAG) Program/Grants to States and
Territories
16.803
ARRA — Recovery Act — Edward Byrne Memorial Justice
Assistance Grant (JAG) Program/Grants to Units of Local
Government
16.804
Airport Improvement Program
20.106
Highway Planning and Construction Cluster
Highway Planning and Construction
20.205
Recreational Trails Program
20.219
Federal Transit Cluster
Federal Transit — Capital Investment Grants
20.500
Federal Transit —Formula Grants
20.507
163
City of Iowa City, Iowa
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Part L• Summary of the Independent Auditor's Results: (continued)
Dollar threshold used to distinguish between type A
and type B programs: $1,503,123
Auditee qualified as low -risk auditee? Yes
Part II: Findings Related to the Financial Statements:
MATERIAL WEAKNESS:
2013 -A Material Audit Adjustment
Criteria — A properly designed system of internal control over financial reporting allows entities to
initiate, authorize, record, process, and report financial data reliably in accordance with generally
accepted accounting principles.
Condition — During the course of our engagement, we proposed a material audit adjustment to the
financial statements that would not have been identified as a result of the City's existing internal
controls and, therefore, could have resulted in material misstatements of the City's financial statements.
Cause — The material audit adjustment was to adjust the beginning of the year net position of the
Sanitation Fund for the Landfill Closure and Postclosure Care Liability which was calculated
incorrectly in the past based on incorrect landfill capacity information supplied to the accounting staff.
Effect — The effect of this condition was financial data not in accordance with generally accepted
accounting principles.
Recommendation We recommend that additional financial statement review procedures be
implemented to insure accuracy of recorded amounts.
Response — The information used for the past several years to calculate the Landfill Closure and
Postclosure Liability was consistent with the information that is used in the calculation of the funding
requirements for the Municipal Solid Waste Sanitary Landfill Financial Assurance Report Form
submitted to the Department of Natural Resources of the State of Iowa each year. While these
calculations are similar in nature, the City has chosen a very conservative approach that is allowed by
the State to show the funding requirement. This alternate approach is not allowed by U.S. GAAP in the
calculation of the liability, therefore creating a discrepancy.
Accounting will work to implement a more stringent review process of the information obtained from
other City divisions and outside entities to make sure the information is in compliant with U.S. GAAP
requirements.
Part III: Findings and Questioned Costs for Federal Awards:
There were no findings and questioned costs to report.
164
City of Iowa City, Iowa
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Part IV: Other Findings Related to Required Statutory Reporting:
2013 -IA -A Certified Budget — Disbursements during the year ended June 30, 2013, did not exceed the amount
budgeted. However, before the budget was amended, disbursements exceeded the amount budgeted
for the Community and Economic Development function.
Recommendation — The budget should have been amended in accordance with Chapter 384.18 of
the Code of Iowa before disbursements were allowed to exceed the budget.
Response — The City is looking to improve its budget monitoring procedures and revise the budget
preparation process to help reduce the likelihood of such an occurrence.
2013 -IA -B Questionable Expenditures —We noted no expenditures that we believe may fail to meet the
requirements of public purpose as defined in an Attorney General's opinion dated April 25, 1979.
2013 -IA -C Travel Expense —No expenditures of City money for travel expenses of spouses of City officials
or employees were noted.
2013 -IA -D Business Transactions — Business transactions between the City and City officials or employees
are detailed as follows:
Name, Title, and
Business Connection
Art Bettis, Spouse of Brenda Nations,
Environmental Coordinator, Landfill
Terry Dickens, Council Member
Part owner of Herteen & Stocker Jewelers
Transaction
Description Amount
Consulting
Services $ 1,500
Service Charge 16
In accordance with Chapter 362.5(3)0 of the Code of Iowa, the transactions with the
Environmental Coordinator and the Council Member do not appear to represent conflicts of interest
since total transactions with each individual did not exceed $1,500 during the fiscal year.
2013 -IA -E Bond Coverage— Surety bond coverage of City officials and employees is in accordance with statutory
provisions. The amount of coverage should be reviewed annually to ensure the coverage is adequate for
current operations.
2013 -IA -F Council Minutes — No transactions were found that we believe should have been approved in the
City Council minutes but were not.
2013 -IA -G Deposits and Investments — No instances of non - compliance with the deposit and investment
provisions of Chapters 12B and 12C of the Code of Iowa and the City's investment policy were
noted.
165
City of Iowa City, Iowa
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Part IV: Other Findings Related to Required Statutory Reporting: (continued)
2013 -IA -H Urban Renewal Annual Report— The urban renewal annual report was properly approved and
certified to the Iowa Department of Management on or before December 1.
2013 -IA -I Revenue Bonds —No instances of non - compliance with the provisions of the City's revenue bond
resolutions were noted.
166
There were no prior year federal findings.
167
City of Iowa City, Iowa
Summary Schedule of Prior Federal Audit Findings
Year Ended June 30, 2013
CALL TO ORDER:
MEMBERS PRESENT:
MEMBERS ABSENT:
STAFF PRESENT:
STAFF ABSENT:
OTHERS PRESENT:
DRAFT
CITIZENS POLICE REVIEW BOARD
MINUTES — January 28, 2014
Chair Joseph Treloar called the meeting to order at 5:33 P.M.
Melissa Jensen, Mazahir Salih
Donald King and Royceann Porter
Staff Kellie Tuttle and
Catherine Pugh (5:35PM)
None
Jim Steffen of the ICPD; Marian Karr, City Clerk
RECOMMENDATIONS TO COUNCIL
None
CONSENT CALENDAR
Motion by Jensen, seconded by Salih, to adopt the consent calendar as presented or
amended.
• Minutes of the meeting on 11/20/13
Motion carried, 3/0, King and Porter absent.
IP77
(5:35PM - Legal Counsel Pugh arrived and was asked to remain in the Lobby for discussion of
Item 3)
OLD BUSINESS - Legal Counsel resignation update
City Clerk Karr stated that due to a conflict of interest Legal Counsel Pugh would not be
participating in the discussion or be able to participate in the interview process for the new
legal counsel. Therefore, the Board needed to decide how to proceed.
Karr handed out and summarized some options outlined for the Board.
Motion by Treloar, seconded by Salih to create an Option 5, directing the City Clerk and the
Equity Director, along with either the Chair or Vice Chair (pending availability) to interview,
complete evaluation tool, and make a recommendation to the Board.
Motion carried, 3/0, King and Porter absent.
(5:49PM - Karr left meeting - Legal Counsel Pugh now participating in meeting)
BOARD INFORMATION None.
STAFF INFORMATION None.
PUBLIC DISCUSSION None.
CPRB
January 28, 2014
Page 2
EXECUTIVE SESSION
Motion by Jensen, seconded by Salih to adjourn into Executive Session based on Section
21.5(1)(a) of the Code of Iowa to review or discuss records which are required or authorized by
state or federal law to be kept confidential or to be kept confidential as a condition for that
government body's possession or continued receipt of federal funds, and 22.7(11) personal
information in confidential personnel records of public bodies including but not limited to cities,
boards of supervisors and school districts, and 22 -7(5) police officer investigative reports,
except where disclosure is authorized elsewhere in the Code; and 22.7(18) Communications
not required by law, rule or procedure that are made to a government body or to any of its
employees by identified persons outside of government, to the extent that the government
body receiving those communications from such persons outside of government could
reasonably believe that those persons would be discouraged from making them to that
government body if they were available for general public examination.
Motion carried, 3/0, King and Porter absent. Open session adjourned at 5:50 P.M.
REGULAR SESSION
Returned to open session at 6:05 P.M.
Motion by Treloar, seconded by Salih to set the level of review for PCRB Complaint #13 -04 to
8 -8 -7 (13)(1)(d), Request additional investigation by the Police Chief or City Manager, or
request police assistance in the Board's own investigation; and direct staff to request additional
information from the Iowa City Police Department regarding PCRB Complaint #13 -04.
Motion carried, 3/0, King and Porter absent.
Motion by Treloar, seconded by Salih to set the level of review for PCRB Complaint #13 -05 to
8 -8 -7 (13)(1)(d), Request additional investigation by the Police Chief or City Manager, or
request police assistance in the Board's own investigation; and direct staff to request additional
information from the Iowa City Police Department regarding PCRB Complaint #13 -05.
Motion carried, 3/0, King and Porter absent.
TENTATIVE MEETING SCHEDULE and FUTURE AGENDAS (subject to change)
• February 11, 2014, 5:30 PM, Helling Conference Rm
• March 11, 2014, 5:30 PM, Helling Conference Rm
• April 8, 2014, 5:30 PM, Helling Conference Rm
• May 13, 2014, 5:30 PM, Helling Conference Rm
ADJOURNMENT
Motion for adjournment by Jensen, seconded by Salih.
Motion carried, 3/0, King and Porter absent.
Meeting adjourned at 6:10 P.M.
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IP12
PLANNING AND ZONING COMMISSION PRELIMINARY
JANUARY 16,— 7:00 PM — FORMAL
EMMA J. HARVAT HALL, CITY HALL
MEMBERS PRESENT: Charlie Eastham, Ann Freerks, Phoebe Martin, Paula Swygard, Jodie
Theobald, John Thomas
MEMBERS ABSENT: Carolyn Dyer
STAFF PRESENT: Bob Miklo, Karen Howard, Eric Goers
OTHERS PRESENT: Sally Scott, Glenn Siders, John McKinstry, Maryann Dennis, Al
Zimmerman, Mark Boding
RECOMMENDATIONS TO CITY COUNCIL:
The Commission voted 6 -0 to recommend approval of SUB13- 00024, a request for
preliminary plat approval of Lindemann Subdivision Part 4B, 6 & 7, an 83 -lot, 25.04 -acre
residential subdivision located on Kenneth Drive north of Camden Road with approval
subject to an acceptable plan for the location design of a mailbox cluster, and prior to the
City acceptance of the open space there will be landscaping established.
CALL TO ORDER:
The meeting was called to order at 7:00 PM.
PUBLIC DISCUSSION OF ANY ITEM NOT ON THE AGENDA:
There was none.
Comprehensive Plan Item
CPA12 -00006
A public hearing for a Comprehensive Plan Amendment to amend the Southwest District
Plan to change the land use designation of property located west of Mormon Trek
Boulevard, north of Westwinds Drive (Walden Square) from Neighborhood Commercial to
General Commercial.
Freerks explained that this item goes together with Item E the rezoning item below REZ12- 00001.
Rezoning item
REZ12 -00001
Discussion of an application submitted by Southgate Development Services for a rezoning
of 8.7 acres of property from Neighborhood Commercial (CN -1) to Community Commercial
(CC -2) zone located at west of Mormon Trek Boulevard, north of Westwinds Drive.
Planning and Zoning Commission
January 16, 2014 - Formal
Page 2 of 11
Miklo showed the Commission images and a zoning map of the area; he then explained the
differences between the CN -1 and CC -2 zones in terms of uses allowed and additional site
development requirements that go along with each of the zones. CN -1 puts limitations on the size
of some uses allowed in the zone, including restaurants, offices, etc.
Miklo explained the history of the development and how over time, because of its locational
advantages and growth on the west side of Iowa City, the shopping center has come to serve a
much wider area than was originally anticipated when the property was zoned CN -1. He stated that
while staff was recommending approval of the comprehensive plan amendment and the rezoning,
their recommendation included three conditions dealing with signage, building design, and outdoor
display in order to help ensure that the shopping center remained compatible with the surrounding
neighborhood.
In response to questions from the Commission, Miklo responded that lighting is the same in both
zones. He also stated that while the immediate neighborhood has not changed since the District
Plan was adopted, the entire west side has grown considerably and commercial areas, other than
those on Highway 1 and Highway 6 have not developed. Miklo explained that the grocery store is,
other than Walmart, the only grocery store west of the river in Iowa City. The same it is true of the
drugstore and bank, which are the only uses of their kind other than what is found on Highway 1.
Miklo explained that in the CN -1 a gas station would require a special exception. In the CC -2 they
are allowed by right. He noted that the 1,000 square foot limit on outdoor display would effectively
preclude a car dealership of sales lot while still allowing retailers to provide seasonal outdoor
displays. He explained that a conditional zoning agreement may put limits on uses allowed in the
zone (such as size restrictions) but cannot prohibit those uses that would otherwise be allowed.
Glenn Siders for Southgate Development indicated that they had no objection to the conditions
staff was recommending. Some of the size limitations on the existing uses in the commercial zone,
such as a physical therapy clinic, were limiting the opportunity for those uses to grow. All the
existing uses comply with the CN -1 standards. He stated that if Hartig Drugstore were to leave and
they were unable to attract a new drugstore, they would probably have to divide the building into 3
new spaces in order to comply with the space limitations and that would be difficult with that
particular building.
Freerks closed the public hearing.
Thomas moved to approve CPA12- 00006, an application submitted by Southgate
Development Services to amend the Southwest District Plan to change the land use map
designation of Walden Square, from Neighborhood Commercial to General Commercial.
Second by Eastham.
Theobald stated that she lives in the neighborhood and that many people in the neighborhood use
the commercial center, especially those living in the nearby apartments who walk to the shopping
center. Also many walk across Mormon Trek to shop. The uses do serve the neighborhood. The
Southwest District Plan had recommendations for improvements to serve pedestrians and it
expressly recommended that it remain a neighborhood commercial area. Therefore, she would
vote against the change.
Freerks stated that she did not see that this would cause a change to what was there but might
allow an opportunity for existing uses to expand. She stated that this would not create a situation in
which traffic would change. While it is good that there is considerable neighborhood foot traffic that
there is also a lot of traffic /customers coming from outside the area. She thinks it is one of those
Planning and Zoning Commission
January 16, 2014 - Formal
Page 3 of 11
tricky areas that needs to be designed to serve both pedestrians and those coming by car. Freerks
asked how new users or property owners would be aware of the special conditions.
Goers indicated that new property owners would become aware through a title opinion.
Martin stated that she believes Mr. Siders addressed the issue of market demand for the changes.
Eastham stated that he would like to see the parking area re- designed and more paved trails to the
north and south and somewhat to the west, however those trails are on someone else's property
and so cannot be a condition or rezoning. Otherwise he cannot see what the change would
portend for the future, especially with the conditions which seem to eliminate things that would not
complement the neighborhood. He is concerned about the proliferation of convenience stores.
Thomas stated that he too was torn. He supports having more neighborhood commercial but
believes it requires the right context. This seems to be a hybrid. He wondered how the parking
area could be reconfigured to allow more commercial uses.
Freerks stated that the goal of the applicant seemed to be to maintain stability and not have
vacancies, such that as certain brick and mortar uses go away, such as video stores, other uses
need to occupy those spaces and that's where growing the existing uses makes sense. Her
concern was not to allow something that truly would not be in the interest of the neighborhood, like
a car dealership.
Theobald stated that the existing small businesses are supported by the neighborhood and that the
"good neighbor policy" had not been used. She is concerned about crime and the addition of
alcohol outlets. Miklo stated that the regulations for alcohol uses are the same.
Miklo stated that the existing development was probably more characteristic of the CC -2 zone in
terms of the placement of buildings and parking. This was built before the current CN -1 site
development standards were in place. The difference in this situation is that the size of uses is
limited in the CN -1 so that they are not reliant on a larger market. The idea with those limitations is
that the zone not be drawing traffic into a neighborhood from the entire community. However, in
this case, because Mormon Trek Boulevard is such a major traffic carrier, the shopping center
already functions as a shopping center for the west side. The only way to go beyond the size
limitations is through a change in the zone.
Howard noted that there is a lot of overlap between all of the commercial zones. The staff report
points out the differences that are distinct that may not be compatible with the neighboring
residential uses or with pedestrian traffic. She pointed out that many other Community Commercial
areas in the city also are surrounded by neighborhoods and people walk to those shopping areas
and they also draw from a larger area. She cited the Towncrest area as one that is similar in that
respect.
Theobald expressed concern about alcohol outlets and businesses open after 9 o'clock at night.
Miklo indicated that the Planning and Zoning commission could put limitations on hours of
operation. He recommended that if the Commission was considering additional conditions, they
should defer to provide time to determine what conditions to apply.
Howard advised the board to keep in mind that the area is built out and is not expanding. A market
is there and the uses and buildings have been established. Theobald noted that the convenience
store in the area has become principally a liquor store, which was not always the case.
Swygard expressed the concern that if commercial uses were allowed to expand that this might
Planning and Zoning Commission
January 16, 2014 - Formal
Page 4 of 11
bring more traffic in from a broader area into a confined space. Miklo pointed out the zoning
boundary —the area is limited size. Also the topography, storm water basin, and the residential
units above the storefronts provide some buffer between the shopping center and the adjacent
residential area. The parking area is also well used such that there is not a lot of opportunity to new
retail space beyond the buildings that are there currently.
Eastham noted that the present uses there are what make this a focal point for the neighborhood
and questioned whether those uses might not change if there is higher demand for larger spaces.
Swygard asked whether a transition to larger uses would impact the parking. Howard responded
that they can only have as much square footage as they can park, and that the parking
requirements are the same in both zones.
Thomas said his concern was that this could lead to there being fewer small establishments in the
zone. He asked whether there are conditions that could help to preserve a mix.
Howard stated that the CN -1 zone limited eating and drinking establishments to an occupant load
of 100 though it could go up to 125 with a special exception. She said that is a fairly large size. She
noted that a restaurant is not open after midnight; if it is open after midnight and serves alcohol it is
considered a drinking establishment.
Goers noted that the alcohol sales rule —the 1,000 foot separation rule —does not apply in the CN-
1 or CC -2 zone.
The applicant indicated that they would not entertain limitations on size or hours of operation. He
indicated he would agree to a 2 -week deferral.
Thomas withdrew his motion to approve.
Eastham moved for deferral of the Comprehensive Plan item to the following meeting.
Theobald seconded the motion. A vote was taken and the motion carried 6 -0.
Eastham moved to defer item REZ12 -00001 for the rezoning of the property to the following
meeting. Second by Martin. A vote was taken and the motion carried 6 -0.
Development Item
SUB13 -00024
Discussion of an application submitted by Southgate Development for a preliminary plat of
Lindemann Subdivision Part 4B, 6, & 7, an 83 -lot, 25.04 -acre residential subdivision located
on Kenneth and Charles Drive, north of Gustav Street.
Miklo said this item had been deferred from December and they have now received a revised plat
that extends Kenneth Drive and Daniel Drive to the north as called for in the Comprehensive Plan
and the Conditional Zoning Agreement. He said that staff believes in this case that eighty -three
mailboxes in the same cluster would be considered a large cluster and therefore should have some
consideration to how it's located in the subdivision and how it's designed. He said the applicant has
worked with the Post Office to identify an outlot for the cluster to be permanently located, and there
may be some need for the clusters to be temporarily located, as it's possible that not all the streets
will be built at once and there may not be access to the clusters.
Miklo said staff will ask the applicant to make a proposal for landscaping around the cluster. He
Planning and Zoning Commission
January 16, 2014 - Formal
Page 5 of 11
said the reasons for the requests for landscaping are that some landscaping will help buffer the
activity associated with eighty -three residents picking up mail, primarily around the same time of
day, and that the appearance of a large cluster will have an impact on the adjacent area. He said
staff recommends approval for this item subject to a plan for the cluster and landscaping. Miklo
said the applicant is concerned that the homeowners' association may not like the landscaping
chosen, and he said that one solution would be to require installation after the homeowners'
association is established so the developer could work with the association to come up with a
satisfactory plan.
Freerks asked how the parking works for these clusters.
Miklo said that so far the clusters have been fairly small so there hasn't been a pull -over. Martin
said at the larger clusters in Idlewyld and Spring Valley there are pull - overs. Miklo said they didn't
specify that as a requirement, and the thought is that it would be done on a case by case basis. He
said there is some open space in this instance so people could park on the street.
Eastham asked about the vehicles turning around after people have gotten their mail. Miklo said it
depends on how people get to the cluster, and hopefully many of them would walk.
Martin asked for and got clarification that this is a requirement of the Post Office yet it will not help
financially in any way.
Freerks opened public hearing.
Glenn Siders of Southgate Development said they don't want to show a specific landscape plan
until the homeowners' association is established, and they are willing to stipulate to that in legal
documents. He said they did create a concrete pad for the actual mailbox units and green space
around that in an outlot to provide for landscaping. He said an outlot that gets dedicated to the City
will be independent of the landscaped area and will also be stipulated to in the legal papers. Miklo
suggested using the phrase "prior to the City acceptance of the open space there will be
landscaping established." The applicant and the City Attorney concurred with that.
Freerks closed public hearing.
Eastham moved to recommend approval of SUB13- 00024, a request for preliminary plat
approval of Lindemann Subdivision Part 4B, 6 & 7, an 83 -lot, 25.04 -acre residential
subdivision located on Kenneth Drive north of Camden Road with approval subject to an
acceptable plan for the location design of a mailbox cluster, and prior to the City
acceptance of the open space there will be landscaping established.
Martin seconded.
Freerks said she's happy to see the street connection. She said the mailbox clusters are
something new, and it remains to see how they look as they get bigger. She said it's something the
City is stuck with. She said she thinks this development will be a good addition to the community.
Eastham said he's happy to see the interconnected street design working out.
A vote was taken and the motion carried 6 -0.
Freerks called for a four minute break.
Freerks called the meeting back to order.
Planning and Zoning Commission
January 16, 2014 - Formal
Page 6 of 11
Code Items
Discussion of Riverfront Crossings District Form -Based Zoning Code. (Available for review
at http: /fwww.icgov.orp / ?id =2094)
Eastham disclosed that he had been present at a meeting of a group that has been interested in
the form based code section having to do with the affordable and elder housing. He said the gist of
what was said at that meeting is taken up in correspondence from that group and its
recommendation and request. He said the discussion was mainly on how to include anything in the
Code or the Riverfront Crossings Plan in terms of achieving affordable housing in that area. He
said at the meeting he tried to provide information about how the Commission works and when it
meets.
Eastham said he would provide an email from that group that summarized the discussion. Goers
said that it would be appropriate to include those emails in the records of this meeting.
Howard said the Commission had a work session January 13 to go through some things that the
Commission wanted staff to look at with regard to various aspects of what's proposed in this code.
Freerks said the Commission had discussion about the proposed form based code at its work
session and people submitted questions, and now it's important for the public to comment and give
feedback on it as well.
Swygard asked for clarification about distance from student housing on the west side. Howard said
to qualify for the student housing bonus provision the project would have to be within one - thousand
feet walking distance of the edge of the campus as defined on a map that she showed. Swygard
asked if it would be limited to one side of the street. Howard said it would apply to both sides of
Riverside Drive as well as to distance from the campus on the other side of the river. She noted
that the campus boundaries for purposes of the form -based code are illustrated on the regulating
plan for Riverfront Crossings.
Freerks asked what would happen if the university acquired more property. Howard said the map
would then have to be revised.
Eastham said some of the discussion at their last meetings had to do with accessibility of
structures allowed by the form based code provisions and whether the code was sufficient to
assure that no -step entrances were going to be possible. He said for at least a few of the frontage
types he didn't see that they allowed a sidewalk level building to be built.
Howard noted that the code states "steps and /or ramps" and the ADA requirements in the building
code would determine how accessibility is addressed. Eastham said he would like the staff to
clearly address what the form based code language actually requires and allows for no -step
entrance at the front of each one of the allowed building types. Howard said there was no intention
to make it different than any other part of the city.
Freerks opened public discussion.
Sally Scott said she is the volunteer facilitator for a new organization called The Johnson County
Affordable Homes Coalition but she is speaking tonight as an individual. She said the form based
code does address some of the issues she's concerned about. For example, there is a bonus
provision for affordable or workforce housing. However, she stated that it is problematic that
affordable housing is not mentioned as a goal in the Master Plan for Downtown and Riverfront
Crossings.
Planning and Zoning Commission
January 16, 2014 - Formal
Page 7 of 11
Freerks noted that the Master Plan was approved earlier in 2013 and that what was being
considered by the Commission at this time was the form -based code for Riverfront Crossings.
Scott said she is requesting that the Downtown and Riverfront Crossings Master Plan be amended
to specify that 15% of all residential units, approximately 450, should be accessible to people
earning less than 80% of Area Median Income. She said that once the City government
incorporates this target into the Master Plan, a task force of city officials, for - profit and nonprofit
housing developers, University officials and city residents should determine the specific means to
achieve the goal.
Scott said significant public dollars will support the redevelopment of this area, and given the large
investments of public funds, residential development in this area should benefit the full range of
Iowa City residents, including lower- income and older people.
Scott said the Downtown and Riverfront Crossings Master Plan adopted in January 2013 makes no
mention of affordable housing outside of arts- related units in the Gilbert District. She said the
shortage of affordable housing in Iowa City has become apparent since then, as over 63% of
renters are paying more than 30% of their income on housing costs. She said other than students,
most people earning less than $35,000 can't afford to live in Iowa City, resulting in more people
moving farther from their places of work, which negatively impacts families, communities and the
environment.
Scott said the provision of incentives in the Riverfront Crossings Form -Based Development
Standards does not guarantee that any affordable or elder housing will be built in that area, which
would be a huge missed opportunity. She urged the City of Iowa City to make affordable housing
an integral, not an optional, part of the Riverfront Crossings redevelopment.
John McKinstry of 308 Ronalds Street said although he can't speak officially for the Consultation of
Religious Communities, his clergy and laity colleagues share his concerns about affordable
housing. He read from a letter written by Bob Welsh of 84 Penfro Drive that stated that one of the
important features of a livable community is affordable accessible housing and that Riverfront
Crossings provides Iowa City an opportunity to declare in the Form -Based Development
Guidelines that it is the City's intent that 100% of all housing units in Riverfront Crossings are
totally accessible. Welsh went on to say that he hopes the City's will affirm in those Guidelines its
intent to ensure that all the housing units are affordable, citing the example that if 16% of families
had income under $25,000 then 16% of the housing units would be affordable for persons at that
income level. He urged the City to not miss the opportunity that Riverfront Crossings presents.
McKinstry said he applauds the Iowa City Community School District for their diversity policy which
is intended to balance out the past failings of the entire county to have adequate amount and
scattering of affordable housing to overcome some of those geographic inequalities that exist. He
said he believes when public funds are used in redevelopment then the entire public needs to
benefit directly and that the lower income people who work in this neighborhood should have
places to live within it. He said it is increasingly difficult for working families to have affordable
housing in this county, and he thinks it's the responsibility of everyone to see that we don't
continue to go down that road that we've been on for years.
Maryann Dennis said she is speaking for The Housing Fellowship and wants to reiterate what
previous speakers have said. She said City Council recently adopted priorities for neighborhood
stabilization in their Strategic Plan, and one of the Plan's priorities is to define and address
affordable housing issues in Iowa City. She said the Riverfront Crossings regulations can help to
achieve that goal by including bonuses for development that reserve a minimum of 15% of the
dwellings as affordable to households with incomes below 80 %.
Planning and Zoning Commission
January 16, 2014 - Formal
Page 8 of 11
Al Zimmerman of 2422 Lakeside Drive #4 said he is a retired minister who moved back to Iowa
City to be close to his family, and he really had to struggle to find affordable housing, even with
what he considers a good income. He asked the Commission to keep the entire community in mind
as they determine this new project. He said he would hope that the housing that is provided will
reflect all socioeconomic groups in the community so that we can truly be a community.
Freerks closed public discussion.
Eastham moved to defer this item to the meeting of February 6.
Thomas seconded.
Freerks said they have laid forth a number of issues for staff to address including affordable
housing, building height and entry levels.
Martin asked if a certain number of units within a building are set aside for affordable housing, are
they not rented except to someone who meets that requirement and how long do they remain
vacant if they don't get filled.
Howard said the proposal is to explore options to achieve affordable housing goals and there's no
one right answer to how it might be done. She said to research how inclusionary housing could be
incorporated into the code would take some time.
Freerks explained to Martin that the idea is to give people incentives to want to use the form -based
code and to also do affordable housing. She said the Commission is asking staff to explore how
best to entice people to want to do that.
Miklo said that typically with inclusionary zoning certain units are set aside to be rented or sold at a
certain price and they are not allowed to go back to the market rate.
Freerks said that inclusionary zoning has been discussed often over the years and it's something
that City Council, which is more of a political body, has declined to go forward with, but that's a
broader issue that could be addressed in the plan overall.
Eastham said the specifics of the request, which are not something he would characterize as a
request to adopt an inclusionary zoning ordinance, but the request is to make an amendment to
the Riverfront Crossings Master Plan to achieve specific goals.
Howard explained the steps to amending the Comprehensive Plan in regards to the Downtown and
Riverfront Crossings Master Plan: someone would need to submit an application to amend the
plan, notice would be published, and it would be placed on the Commission's formal agenda for
discussion. She noted that a Commission member could initiate a form discussion, but it does
need to be on the agenda and public notice given.
A vote was taken to defer discussion until the next meeting. The motion carried 6 -0.
Discussion of proposed changes to parking requirements and alternatives to parking
minimums in the Zoning Code that would apply in Downtown and the Riverfront Crossings
District and elimination of the Near Southside Parking Facility District and associated
parking impact fee.
Howard noted that staff put the draft amendments on the Commission's agenda for discussion, but
Planning and Zoning Commission
January 16, 2014 - Formal
Page 9 of 11
recommend deferral until the code language can be further refined. This is an opportunity for
questions or discussion. Howard noted that currently it is a requirement in the Near Southside
district that if you build residential units you must pay a parking impact fee rather than build
parking. The City would like to change that to have developers build parking on -site to serve the
needs of the residents according to the parking requirements. However, the code would offer an
option for payment in lieu of providing some or all of the parking on -site. These funds would then
be used to construct and maintain centrally located public parking facilities.
Howard explained other proposed changes would address a situation in which a grocery store is
included in a proposed development in a downtown location in a mixed use building where all the
feasible parking that can be built is needed for the grocery store. In such a case, the developer
could pay a fee in lieu of providing on -site parking for the upper floor residential. She also noted
that staff is recommending deletion of the maximum parking requirement in the CB -5 zone, since
developers building extra parking downtown has never been an issue.
Freerks asked whether this alternative to the minimum parking requirement (payment of a fee in
lieu) would promote the demolition of existing buildings. Howard responded that the current
regulations adopted in 2009 were not working well to address the residential and student housing
needs for parking. One part of the current regulation allows developers to seek special exception to
provide required parking in a municipal ramp, however there was no cost to the developer other
than the cost of the parking permits, which is passed along to the tenant. There was also no way
for the Board of Adjustment to judge what amount of parking was appropriate to grant and so they
were giving away public parking basically at no cost to the developer. The proposed change would
ensure that the developer is paying a proportional share of the cost of building the public parking.
The fee is proposed to be at 75% the cost to construct a structured parking space. By internalizing
the cost, the demand for the exception is more likely to be limited to those properties that really
cannot provide all the parking. The special exception is not allowed for historic landmarks or
properties listed as "key buildings" in the master plan. There are also design requirements for new
buildings constructed next to historic buildings.
Eastham asked whether the current revenue from ramps was insufficient to build new ramps.
Howard indicated that the fees basically cover maintenance and operation of existing parking
facilities, but what we are talking about is the cost of constructing the parking. Goers explained that
the funding for the public parking ramps comes from a number of sources, including federal.
Eastham asked about the provision that allows an exemption for affordable housing. Howard said
that provision could be extended to the Riverfront Crossings District.
Thomas asked about the parking requirement for 3- bedroom units. Howard indicated that there
were two reasons: to address neighborhood stabilization by encouraging more small (1- and 2-
bedroom units); and to acknowledge that 3- bedroom apartments in the multi - family buildings
downtown tend to be student apartments and not for more permanent residents, who would likely
have a lower parking demand. She recognized that the proposal had not distinguished between
building types and that there were areas within the plan that may be more attractive to families and
thus the parking requirement should be different for those. She stated that that staff would address
that in a revision. Thomas said he thought families may want to live in multi - family buildings at the
south end of the district and thought the parking requirement was too high. Thomas also said that
close to campus it might make sense to have no parking requirement since in his view that group
has good access to transit and with the advancements in shared vehicles that may diminish the
need for vehicles. Howard indicated that they believe the standard reflects demand at this time, but
that they were looking at an option to convert some spaces for scooter or motorcycle parking and
bike parking facilities.
Planning and Zoning Commission
January 16, 2014 - Formal
Page 10 of 11
Freerks opened the public hearing.
Mark Bruzan stated that the provisions seemed designed for larger developments, but that he has
been working on a number of small projects, say a 30 x 100 foot lot. Those smaller lots become
prohibitive to develop. Howard responded that the provision to reduce parking through a "fee in lieu
of is intended for that type of situation. Right now that option exists only for the South Downtown
area and the Central Business District, which are areas in which the City will provide parking
facilities in the future.
Thomas moved to defer discussion to the next meeting. Second by Martin.
A vote was taken and the motion carried 6 -0.
Consideration of Meeting Minutes: December 19, 2013 & January 2, 2014.
Eastham moved to approve. Second by Swygard.
A vote was taken and the motion carried 6 -0.
OTHER
Miklo suggested scheduling another informal meeting for Monday, February 3, at 5:30. The
discussion would focus on Riverfront Crossings and parking changes.
Swygard stated that she has misspoken at a prior meeting saying that Orchard Street had 11,000
cars. She had meant Benton Street. Orchard Street according to the most recent study has 2,385
cars.
ADJOURNMENT:
Eastham moved to adjourn.
Theobald seconded.
The meeting was adjourned on a 6 -0 vote.
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