HomeMy WebLinkAboutFY2010-2012 Financial Plan part 1for the City of Iowa Cityfor the City of Iowa City
City of Iowa City
Adopted Budget for the
Fiscal Year Ending June 30, 2010 &
FY2009 - 2013 Capital Improvements Program (CIP)
City Council:
Connie Champion
District B
Regenia D. Bailey
Mayor
District C
Amy Correia
At-Large
Matt Hayek
At-Large
Ross Wilburn
District A
Mike O’Donnell
At-Large
Mike Wright
At-Large
Interim City Manager Finance Director
Dale Helling Kevin O'Malley
Budget Analyst Administrative Secretary
Deb Mansfield Cynthia Ambrose
Management Analyst
Leigh Lewis
APPRECIATION
This financial plan includes the ideas and recommendations of many citizens,
the City Council and City staff. During the year many suggestions are received
from citizens in the City Council hearings and informal contacts. The major
impact of the City Council upon this financial plan is in the priorities and
programs adopted by the City Council during the current year.
While other departments were intensely involved in the preparation of this
financial plan, most of the credit for this document goes to the members of the
Finance Department. Particular gratitude is expressed to the City Manager,
Finance Director, Budget/Management Analyst, Finance Management Analyst,
Finance Administrative Secretary, Document Services Center and Information
Technology Services.
While we surely appreciate all contributions to this budget, it must be
remembered that the real thanks must go to the City employees, who, on a daily
basis, transform this document into the City’s program of services.
CITY OF IOWA CITY
Adopted Budget for the
Fiscal Year Ending June 30, 2010
and the
FY2010 – 2012 Financial Plan
TABLE OF CONTENTS PAGE
CITY MANAGER’S LETTER ............................................................................................................ 1
BUDGET PRIORITY SUMMARY……………………………………………………………………….... 3
FINANCIAL PLAN OVERVIEW ........................................................................................................ 5
ORGANIZATIONAL CHART ............................................................................................................ 6
FINANCIAL AND FISCAL POLICIES............................................................................................... 7
SUMMARIES AND CHARTS:
Financial Plan Analysis ............................................................................................................... 15
Property Tax ......................................................................................................................... 15
General Fund Revenue ........................................................................................................ 18
General Fund Summaries..................................................................................................... 22
General Fund Expenditures.................................................................................................. 24
General Fund Year-end Cash Balance ................................................................................ 26
Debt Service Fund................................................................................................................ 28
Internal Service Funds.......................................................................................................... 29
Special Revenue Funds........................................................................................................ 30
Business Type Funds ........................................................................................................... 30
Transfers-In................................................................................................................................. 33
Transfers-Out .............................................................................................................................. 37
FY2010 Additional Position Requests......................................................................................... 40
Personnel Listing by Department Full-Time Equivalents............................................................ 41
PUBLIC SAFETY:
Police Department:
Summary............................................................................................................................... 43
Administration....................................................................................................................... 44
Patrol..................................................................................................................................... 45
Criminal Investigation ........................................................................................................... 46
Records................................................................................................................................. 46
Crossing Guards................................................................................................................... 47
Emergency Communications................................................................................................ 48
Grants………………………………………………………………………………………………… 49
Fire Department
Summary............................................................................................................................... 50
Equipment Replacement Reserve........................................................................................ 50
Housing & Inspection Services:
Administration....................................................................................................................... 51
Housing Inspection ............................................................................................................... 51
Building Inspection................................................................................................................ 52
Animal Services........................................................................................................................... 53
Deer Control................................................................................................................................ 53
Flood Damage............................................................................................................................. 54
PUBLIC WORKS:
Public Works Administration ....................................................................................................... 55
Engineering ................................................................................................................................. 55
Road Use Tax (RUT)................................................................................................................... 56
Public Transit............................................................................................................................... 57
Transit Reserve........................................................................................................................... 58
Energy Conservation................................................................................................................... 58
CULTURE AND RECREATION:
Library:
Operations ............................................................................................................................ 59
Replacement Reserves………………………………………………………………………... ... 60
Reimbursables & Escrows.................................................................................................... 61
Parks & Recreation:
Administration...................................................................................................................... 62
Parkland Acquisition Reserve.............................................................................................. 62
Parks.................................................................................................................................... 63
Recreation............................................................................................................................ 64
Forestry................................................................................................................................ 65
CBD Maintenance................................................................................................................ 66
Cemetery ............................................................................................................................. 67
Government Buildings ......................................................................................................... 68
Senior Center .............................................................................................................................. 69
Senior Center Gift Fund....................................................................................................... 70
New Horizons Band.............................................................................................................. 70
COMMUNITY AND ECONOMIC DEVELOPMENT:
Planning and Community Development:
PCD Administration .............................................................................................................. 71
Urban Planning..................................................................................................................... 71
Neighborhood Services ........................................................................................................ 72
Public Art............................................................................................................................... 72
Community Development Non-Grant Activity....................................................................... 73
Economic Development........................................................................................................ 74
G.R.I.P. – General Rehabilitation and Improvement Program............................................. 75
Peninsula Apartments........................................................................................................... 75
Community Development Block Grant (CDBG) - Metro Entitlement.................................... 76
H.O.M.E. Program ................................................................................................................ 76
Tax Increment Financing Districts (TIF) ............................................................................... 77
Johnson County Council of Governments (JCCOG):
JCCOG Summary .......................................................................................................... 79
Administration................................................................................................................. 80
Human Services Planning.............................................................................................. 80
Transportation Planning ................................................................................................. 81
Rural Community Assistance......................................................................................... 81
Flood Relief Grants.............................................................................................................. 82
GENERAL GOVERNMENT:
City Council ................................................................................................................................. 83
City Manager ............................................................................................................................... 83
City Clerk..................................................................................................................................... 84
City Attorney................................................................................................................................ 84
Personnel .................................................................................................................................... 85
Police Citizens’ Review Board (PCRB)....................................................................................... 85
Human Rights.............................................................................................................................. 86
Non-Operational Administration.................................................................................................. 87
Aid to Agencies ........................................................................................................................... 88
Community Event & Program Funding........................................................................................ 89
Finance Department:
Finance Administration ......................................................................................................... 90
Accounting & Reporting........................................................................................................ 91
Purchasing............................................................................................................................ 91
Revenue................................................................................................................................ 92
Document Services............................................................................................................... 92
Risk Management – Tort Liability ......................................................................................... 93
Employee Benefits ...................................................................................................................... 93
Emergency Levy.......................................................................................................................... 94
DEBT SERVICE:
Debt Service................................................................................................................................ 95
General Obligation Debt by Individual Issue............................................................................... 96
BUSINESS TYPE ACTIVITIES (ENTERPRISE FUNDS):
Water:
Water Operations.................................................................................................................. 97
Water Debt Service............................................................................................................... 98
Wastewater Treatment:
Wastewater Treatment Operations....................................................................................... 99
Wastewater Treatment Debt Service.................................................................................... 100
Airport Operations....................................................................................................................... 101
Landfill ........................................................................................................................................ 102
Refuse Collection Operations ..................................................................................................... 103
Broadband Telecommunications................................................................................................. 104
Housing Authority........................................................................................................................ 105
Storm Water Management.......................................................................................................... 106
Parking:
Parking Operations............................................................................................................... 107
Parking Debt Service............................................................................................................ 108
NON-PROGRAM FUNDS:
Equipment:
Fund Summary ..................................................................................................................... 109
General Fleet Maintenance .................................................................................................. 110
Equipment Replacement Reserve........................................................................................ 111
Information Technology Services (ITS):
Fund Summary ..................................................................................................................... 112
Administration & Operations................................................................................................. 113
ITS Equipment Replacement Fund.. .................................................................................... 114
Police Computer Replacement Fund.................................................................................... 114
Risk Management Loss Reserves .............................................................................................. 115
Central Services.......................................................................................................................... 115
Health Insurance Reserve........................................................................................................... 116
Dental Insurance Reserve........................................................................................................... 116
FY2009 – 2013 Program Summary................................................................................................... C - 1
Project Descriptions by ..................................................................................................................... C-2
Recurring Projects ............................................................................................................................. C-22
Projects Scheduled for Completion in FY2009 ................................................................................. C-23
Project Summary by Name ............................................................................................................... C-25
Projects by Funding Source – Receipt Detail.................................................................................... C-57
Unfunded Projects FY2014 and Beyond ........................................................................................... C-64
CAPITAL IMPROVEMENTS PROGRAM (CIP): APPENDIX:
Preparation of the Financial Plan:
Overview .......................................................................................................................... A-1
Schedule .......................................................................................................................... A-2
Process to Amend ........................................................................................................... A-3
Notice of Public Hearing ................................................................................................... A-4
City Council Resolutions Approving ................................................................................. A-5
State Forms ..................................................................................................................... A-8
Summary of All Funds ................................................................................................................ A-13
Property Taxes:
Taxable Assessed Valuations – Certified for Tax Levies ................................................ A-18
Overlapping Tax Levies for the Iowa City Area ............................................................... A-19
City of Iowa City Tax Levies – As a Percentage of Total Tax Rate.................................. A-20
Utility Rates .................................................................................................................................. A-21
Glossary ...................................................................................................................................... A-22
Index by Department.................................................................................................................... A-26
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Budget Priority Summary
Department/Division Amount
Fire- reduction of travel and training budget by 20%18,000
-limit new uniforms 5,000
Housing & Inspections Services-reduction of various supplies 10,176
-expense a portion of director’s salary to Iowa City Housing
Authority 25,000
-initiate a new fee for complaint inspections 25,000
Engineering-increase labor charges to Capital Improvement
-Projects to 28.75%24,674
-initiate excavation permit administration fee of $50 25,000
Library-discontinue parking subsidy to patrons 6,811
-program reductions (Fri Nite Film, winter reading)4,618
-reduce newsletter to twice a year 11,082
-change vendor library catalogue 1,847
-increase fine revenue 15,000
Cemetery-increase fees 12,622
Senior Center-discontinue publishing the Post 5,500
-stop weekly plant care service 1,334
-reduce dumpster/cardboard recycling unit 2,208
-increase membership fee by $5 5,200
Planning & Community Development-reduce building repairs 3,646
-discontinue ‘Public Art’ program 18,208
City Clerk’s Office-eliminate scanner maintenance contract 1,206
-no temporary employee for microfilm conversion 4,500
City Attorney’s Office-charge 60% of research tools to Tort Levy 12,210
-chargeback special services to Iowa City Housing Authority 20,677
Personnel-discontinue employee and wellness newsletters 4,800
Accounting & Purchasing-credit card rebate revenue 10,000
-chargeback for reporting on grant funded programs 17,897
Revenue-increase insufficient funds charge to $25 3,300
Airport-lease Gilbert Street parcel 3,600
TOTAL REDUCTIONS/REVENUES $299,116
Subsequent to the adoption of the FY10 budget, the City Council requested
expenditure reductions and revenue increases to replenish General Fund cash
balances. Interim City Manager Dale Helling asked department managers to
review their budgets and suggested revenue/reduction alternatives. After
reviewing departmental submittals, the City Manager proposed the following
revenue increases/expenditure reductions for the FY10 budget:
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Revised: 06/29/09
Overview 10
FINANCIAL PLAN OVERVIEW
This Three-Year Financial Plan is for fiscal years FY2010 through FY2012, which begin July 1 and end June
30. The Financial Plan includes our one-year annual budget, required by Iowa Code, and provides two
projection years as a planning tool. The purpose of the overview is to disclose the basis on which the
financial plan has been prepared.
The role of a government's operating budget differs from that of a private business. Budgets are an
important internal planning tool for business, but they also play an external role for governmental entities. A
multi-year financial plan informs parties inside and outside government of future objectives and provision of
services to its constituents.
The three-year plan also permits a more comprehensive review of the City’s financial condition, allowing
analysis of current and future 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.
This document contains operating budgets for the governmental funds: general, special revenue, debt
service, capital project and permanent funds. It also includes business type funds and internal service
funds. Budgets are summarized by major revenue and expenditure categories within each division. A
separate multi-year Capital Improvements Program (CIP) show budgeted revenue and expenditures for
FY2009 through FY2013.
The cash basis of accounting has been used for preparation of this document. Revenues are recorded
when received, not necessarily when they are earned, and expenditures are recorded when paid instead of
when they are incurred. The Finance Administration Division monitors actual receipts and expenditures
carefully on a line-item basis. Department directors are ultimately responsible for ensuring that the divisions
under their control stay within budget.
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Citizens of Iowa City
City
Attorney
City
Manager
Mayor &
City Council
Elected
Officials
Appointed
By
Council
& Mayor
Appointed
by City
Manager
Director/
Manager
Employed by
Board or
Commission
City
Clerk
Library
Board of
Trustees
Boards &
Commissions
Airport
Commission
Airport
Manager
Library
Director
Assistant
City
Manager
Fire
Chief
Housing &
Inspection
Services
Director
Finance
Director
Parks &
Recreation
Director
Planning &
Community
Development
Director
Police
Chief
Public Works
Director
Senior Center
Coordinator
Transportation
Services
Director
Key
Broadband
Telecomm.
Human Rights
Human
Resources
Admin.
Accounting
Purchasing
Document
Services
Information
Technology
Services
Revenue
Risk
Management
Admin./Training
Fire
Prevention
Fire
Suppression
Admin.
Building
Inspection
Housing
Authority
Housing
Inspection
Parking
Transit Operations
Para-Transit
Administration
CBD Maintenance
Cemetery
Forestry
Government
Buildings
Parks
Recreation
Administration
Community
Development
Economic
Development
JCCOG Programs
Neighborhood
Services
Urban Planning
Administration
Animal Services
CommunityServices
CriminalInvestigations
EmergencyComm.
Patrol
Records &Investigations
Administration
EnergyConservation
Engineering
Equipment
Maintenance
Landfill
Solid Waste Collection
StormwaterManagement
Streets
Traffic Engineering
WastewaterManagement
Water
Senior Center
12/08
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FINANCIAL & FISCAL POLICIES
Operating Budget
Revenue Policies
Capital Improvement Program
Reserve Policies
Investment Policies
Debt Policies
Compensated Absences
Accounting, Auditing and
Financial Reporting
Purchasing Policies
Risk Management Policies
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FINANCIAL AND FISCAL POLICIES
The City of Iowa City's financial policies set forth the basic framework for the overall fiscal
management of the City. These policies assist the decision-making process of the City Council.
These policies provide guidelines for evaluating both current activities and proposals for future
programs.
Most of the policies represent long-standing principles, traditions and practices, and follow
generally accepted accounting principles which have guided the City in the past and have helped
maintain financial stability.
OPERATING BUDGET POLICIES
The City will prepare an annual balanced budget for all operating funds.
The City will maintain a budgetary control system to ensure adherence to the budget and
will prepare monthly reports comparing actual revenues and expenditures to budgeted
amounts.
Operating budgets are established on a fund/department/program basis.
A contingency account will be maintained in the annual General Fund operating budget to
provide for unanticipated expenditures or to meet unexpected small increases in service
delivery costs, budgeted annually at approximately ¾ of one percent of expenditures and
transfers out. The City Council will be informed semi-annually on staff initiated amendments
from the contingency account to the operating programs within the General Fund.
Budget amendments may be made throughout the year with approval of the Department
Director, Director of Finance and the City Manager. The City Council formally reviews and
approves all amendments processed by staff twice a year in August/September and May.
Increases or amendments to operating budgets are made only in the following situations:
- emergency situations
- transfer from contingency
- expenditures with offsetting revenues or fund balance
- carry-over of prior year budget authority for expenses that had not been paid as of the end
of the fiscal year.
OPERATING BUDGET PREPARATION CRITERIA
General Guidelines
- Maintain the fiscal integrity of the City’s operating and capital improvement budgets in order
to provide services and to construct and maintain the City’s infrastructure.
- Maintain the City’s responsible fiscal position and AAA bond rating.
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- Present budget data to the City Council in a format that will facilitate annual budget
decisions based on a three-year planning perspective. Provide the City Council with a
summary of the three-year forecasts.
- Encourage citizen involvement in the annual budget decision-making process through
public hearings, informal meetings, budget briefs and related informational efforts.
Service Level Guidelines
- Deliver service levels which are consistent with the citizens' willingness to pay and the City's
available resources.
- Base decisions to reduce service levels or eliminate programs on City-wide priorities.
- Recognize that City employees are one of the City government's most valuable resources
and are essential to the delivery of high quality, efficient services.
Revenue Guidelines
- Property tax levy rates will not exceed the limits as established by the State of Iowa.
- Revise user fee rate structures to charge the costs of service provided to the benefiting
customers, while maintaining sensitivity to the needs of low income citizens.
- Support federal and state legislation which provides property tax relief. Oppose legislation
which imposes local service mandates without fiscal support.
Expenditure Guidelines
- Support responsible management efforts to increase productivity by providing resources for
office automation, preventive maintenance, risk management/employee safety, and
employee training.
REVENUE POLICIES
The City will try to maintain a diversified and stable revenue system to minimize short-run
fluctuations in any one revenue source.
The City will attempt to maximize benefits from major revenue sources as a way of
maintaining a stable property tax rate.
The City will follow an aggressive policy of collecting revenues.
The City will establish all user charges and fees at a level related to the full cost (operating,
direct, and indirect) of providing the service, whenever practical.
The City will review licenses, fees, and charges annually to determine if the revenues
support the cost of providing the service.
Property tax funding for recreation activities will not exceed 60% of operational costs with
the exclusion of capital outlay and other improvements.
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Parking, Refuse, Wastewater Treatment, Stormwater, Landfill, Broadband
Telecommunications and Water funds will be self-supporting through user fees.
- Rate adjustments will be submitted to the City Council by ordinance if state or locally
legislated, or by resolution (if not state or locally legislated).
The City will use up to 5% of the annual Road Use Tax allocation to fund employee benefits
for the Streets and Traffic Engineering personnel.
CAPITAL IMPROVEMENT PROGRAM BUDGET POLICIES
The City will develop a multi-year Capital Improvement Program (CIP), which will be
reviewed and updated annually, comply with City Council goals and be compatible with the
Comprehensive Plan whenever possible.
The complete multi-year CIP funding plan must be balanced each year by matching
projected expenditures with proposed revenue sources by fund.
Funding for projects should be obtained through borrowing from:
- bond market, general obligation or revenue bonds
- enterprise fund operations and reserves
- internal loans
The City may utilize General Fund cash balances to fund capital projects whenever
available and feasible. For the Airport, it is policy that the General Fund will match up to
$100,000 in grants received per year.
The City shall utilize available funding sources for capital improvements whenever practical
and feasible such as but not limited to:
- federal and state grant funds
- special assessments
- developer contributions
The City will maintain its physical assets at a level adequate to protect the City's capital
investment and to minimize future maintenance and replacement costs. The budget will
provide for the adequate maintenance and the orderly replacement of the capital plant and
equipment from current revenues when possible.
RESERVE POLICIES
The City will establish a contingency line-item in the annual General Fund operating budget
to provide for unanticipated expenditures or to meet unexpected small increases in service
delivery costs, budgeted at ¾ of one percent of expenditures and transfers out.
Operating cash balances at fiscal year-end will be maintained at a level to ensure sufficient
cash flow throughout the fiscal year. General Fund cash balances will not go below 15%,
with a ceiling of 25%. Cash balances in excess of 25% will be considered for tax relief.
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Reserves will be maintained in the Water, Wastewater and Parking Funds in accordance
with existing bond covenant provisions.
Reserves will be maintained for equipment replacement and for unexpected major repairs in
the following areas: Parking, Wastewater, Water, Landfill, Transit, Broadband
Telecommunication, Equipment Replacement, Information Technology Services, and
Central Services as well as Library Computer Equipment and Parkland Acquisition and
Replacement.
Reserves, based on actuaries, will be maintained for the Risk Management Loss Reserve,
Medical and Dental Insurance Funds.
All City trucks, cars and necessary accessories will be maintained on a replacement cost
basis each year. A separate reserve fund has been set up to fund these replacements.
Additions to the fleet are made through allocations in the annual budget. Fire Department
vehicles and Transit buses will be purchased through the issuance of debt.
All general obligation debt will be paid from the Debt Service Fund. General Obligation debt
applicable to Enterprise Fund projects will be paid out of the Debt Service Fund, but will be
abated from revenues from the respective Enterprise Fund(s).
INVESTMENT POLICIES
Disbursement, collection, and deposit of all funds will be managed to insure maximum
investment opportunity for City funds.
The City will strive to maximize the return on its investment portfolio, with the primary
objective of preserving capital in accordance with the City's investment policy and prudent
investment practices.
All City funds not restricted by bond issue covenants will be pooled for investments, with
interest allocations made monthly.
DEBT POLICIES
The City will confine long-term borrowing to capital improvements and Community and
Economic Development initiatives. Short term borrowing will be applicable for large dollar
rolling stock (buses, fire apparatus) purchases and computer systems.
Total general obligation debt will not exceed 5% of total taxable assessed value of real
property.
The debt service property tax levy shall not exceed 25% of the total property tax levy.
The City will follow a policy of full disclosure on every financial report and bond prospectus.
The City will use "pay as you go" financing to fund general capital improvement projects,
whenever feasible and practical.
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COMPENSATED ABSENCES
Administrative employees hired prior to June 15, 1983 and all other employees hired prior to June
29, 1985, upon death, retirement or termination (except firefighters) are entitled to be paid for one-
half of the total accumulated sick leave hours at the current effective hourly rate for that employee
up to the sick leave payout amount calculated as of June 28, 1985, whichever is less.
After June 28, 1985, employees accumulate vacation, sick leave, and other benefits at various
rates depending on bargaining group and length of service. Employees are paid for their total
unused vacation time upon death, termination (except firefighters) or retirement. However, sick
leave can only be used during employment. The cost of compensated absences are recognized
when payments are made to employees and the City amends the budget at that time.
ACCOUNTING, AUDITING, AND FINANCIAL REPORTING POLICIES
Quarterly financial reports will be prepared.
A three-year financial plan for all operating funds will be prepared by the City Manager and
presented to the City Council for their review.
A Multi-Year Capital Improvement Program budget will be prepared, reviewed and revised
annually.
An independent audit will be performed annually for all City funds.
The City will produce a Comprehensive Annual Financial Report (CAFR) in accordance with
generally accepted accounting principles as outlined by the Governmental Accounting
Standards Board.
PURCHASING POLICIES
Purchases for all City departments for the City of Iowa City shall be in accordance with the
City Procurement Policy/Purchasing manual.
Methods of source selection are as follows:
Public Improvements
Competitive sealed bidding shall be used for Public Improvement Contracts of $100,000
or greater (Code of Iowa) or Road Projects of $57,000 or greater. This process shall
consist of:
Public hearing on plans and specifications
Approval of plans and specifications by City Council or Commission
Invitation for bids
Bid opening
Bid acceptance and bid evaluation
Bid award – City Council/Commission authorization
The competitive quotation process is required for public improvement projects estimated
between $57,000 and $100,000. This process shall consist of:
Notice to bidders
Bid opening
Bid evaluation
Bid acceptance and award by City Manager or Commission
Notice of award in minutes of next meeting of City Council or Commission
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The informal quotation process is required for public improvement projects and street,
bridge and culvert projects under $57,000. This process shall consist of:
Invitation to bid
Bid opening
Bid evaluation
Bid acceptance and award by City Manager over $5,000, Department Director over
$1,500 or Division Head under $1,500
-Professional Services
The consultant selection procedures guide all City departments involved in procuring
engineering, architectural, and other professional services. Within approved budgets, the
City Manager may approve contracts up to $50,000 and the City Council approves
contracts over $50,000.
-Major Purchases
The Purchasing Division operates a "voluntary purchasing" system rather than a complete
"centralized purchasing" system. Under the voluntary system, departments obtain
standard operating items, within approved budgets, utilizing Purchasing procedures. The
Purchasing Division reviews various categories of merchandise and services and makes
recommendations for consolidation and standardization of purchases to reduce
duplication and overall costs.
-Emergency Procurement
In the event of an emergency, supplies, services or construction may be purchased
without regard to normal purchase selection procedures to protect the health and welfare
of the public. The City Manager shall keep the City Council informed of the extent of the
emergency.
-Gifts/Conflict of Interest/Interest in Public Contracts
Conduct shall be in accordance with the Code of Iowa - Chapters 68B.22 Gifts, 331.342
Conflict of Interest and 362.5 Interest in Public Contract. A City officer or employee shall
not have an interest, direct or indirect, in any contract or job of work or material or the
profits thereof or services to be furnished or performed for the officers or employees of the
City.
RISK MANAGEMENT POLICIES
It shall be the policy of the City of Iowa City to assume the risk of property damage, liability
and dishonesty in all cases in which the exposure is so small or dispersed that the loss
would not significantly or adversely affect the operations or financial position of the City.
Insurance will not be purchased to cover loss exposures below prevailing
deductible/retention amounts of current insurance held by the City of Iowa City, unless such
insurance is required by statute or by contact, or in those instances in which it is desirable to
obtain special services, such as inspection or claim adjustment services in connection with
insurance. The deductible/retention amounts will be reviewed once annually by the Director
of Finance and the Risk Manager to ensure appropriateness of the amounts.
Insurance will be purchased where possible against all major exposures which might result
in loss in excess of the City's insurance reserve through the purchase of the following types
of insurance:
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- All risk insurance on real and personal property.
- General liability insurance.
- Automobile liability insurance.
- Fidelity and crime insurance.
- Catastrophic workmen's compensation insurance.
The City will self-insure in those instances where the cost of insurance is so high that it
would be more cost effective to assume the risk.
Real property will be insured on replacement cost basis, as determined by a competent
appraisal service, against as wide a range of perils as possible. The value will be reviewed
once annually by the Risk Manager and the City's insurance advisor.
Loss prevention recommendations made by insurance companies, the state fire marshal or
local fire authorities will, whenever possible, be implemented. In those cases in which such
recommendations are not followed, a written report in which an explanation or justification is
made will be filed with the Director of Finance and the City Manager within 30 days of
receipt of the report.
Insurance will be purchased only through licensed agents or agencies who have the staff
and technical competence to adequately service the insurance provided.
Insurance will be placed only in insurance companies rated A+ or A in Bests. Insurance
placed in other companies will require a written report of the particulars, such report to be
filed with the Risk Manager.
The administration of the risk management policy will be a responsibility of the Risk
Manager. Such responsibility includes placement of insurance coverage, maintenance of
property appraisals and inventories, processing of claims and maintenance of loss records,
and supervision of loss prevention activities.
Settlement of claims are handled through the Risk Management Division and/or City
Attorney Office. The Risk Manager is authorized to settle claims up to $3,000, the City
Manager authorizes claim settlements between $3,000 and $20,000 and City Council
approval is needed for settlements above $20,000.
finadm\budget\budget.pol
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SUMMARIES & CHARTS
Financial Plan Analysis
Transfers
Additional Position Requests
Personnel Listing
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FINANCIAL PLAN ANALYSIS
I. GOVERNMENTAL ACTIVITIES
Governmental Activities consist of the General Fund, Debt Service Fund, the Trust and Agency Funds,
Special Revenue Funds and Internal Service Funds.
A. PROPERTY TAXES
Property tax is the single largest revenue source for the City of Iowa City General Fund, accounting for
sixty-three percent (63%) of FY2010 General Fund revenues. Taxable property in Iowa is categorized
into distinct classes, namely residential, commercial, industrial, utilities, or agricultural with each class
having different procedures for assessing value for taxing purposes. To reduce the opportunity for
dramatic tax shifts between the classes from year to year, a statutory limit of 4% a year has been
imposed, commonly called the growth limitation. For example, if statewide growth in any one class of
property in any year exceeds 4%, the taxable value is reduced by a percentage so that growth of
taxable valuation is at the 4% ceiling. This percentage is called the “rollback”. Furthermore, residential
property is subject to an additional restriction in which the statewide growth in residential property
cannot exceed the growth in agricultural property. In other words, the taxable growth of urban
residential property is either 4% or equal to the growth in agricultural property, whichever is lower.
The following graph illustrates the impact of the rollback on taxable valuation. In FY2001 the residential
rollback exempted $.7 billion of Iowa City’s residential assessed valuation. In FY2010 the residential
rollback will exempt $1.7 billion of the residential assessed valuation. The rollback for FY2010 is
45.5893% compared to FY2009 residential rollback of 44.0803%
Taxable vs. 100% Assessed Valuation
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50 2001 2002 2003 2004 2005 2006 2007 2008 2 009 2 010
Fiscal Year (FY)
Va
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n
B
i
l
l
i
o
n
s
(
$
)
Taxable Valuation
100% Valuation
Iowa City’s assessed valuation has steadily increased due to new construction and revaluation.
However, assessed residential valuation reduced by the rollback factor has been increasing at a greater
percentage. This trend can impair the ability of local governments to provide necessary services.
15
The City's property tax requests for FY2010 through FY2012 including the FY2009 certified tax request, are as follows:
FY2009 Certified FY2010 Budget LEVIES
Dollars Tax Rate per $1,000 Dollars Tax Rate per $1,000 General Fund Tax Levies:
General $ 19,514,706 8.100 $ 20,368,115 8.100
Transit 2,288,762 0.950 $ 2,388,853 0.950
Tort Liability 1,008,356 0.419 $ 1,057,155 0.420
Library 650,490 0.270 $ 678,937 0.270
Subtotal: 23,462,314 9.739 $ 24,493,060 9.740
Special Revenue Levies:
Emergency 120,461 0.050 $ 643,909 0.256
Employee Benefits 8,734,590 3.625 $ 9,145,032 3.637
Subtotal: 8,855,051 3.675 $ 9,788,941 3.893
Debt Service 10,846,138 4.303 $ 11,106,969 4.219
Total City Levy Property
Taxes: $ 43,163,503 17.717 $ 45,388,971 17.853
% Change from
prior year: 7.99% 2.43% 5.16% 0.77%
Agland Levy $ 4,235 3.004 $ 4,227 3.004
Total Property Taxes $ 43,167,738 ---- $ 45,393,198 ----
FY2011 Projected FY2012 Projected LEVIES
Dollars
Tax Rate
per $1,000 Dollars
Tax Rate
per $1,000
General Fund
Tax Levies:
General $ 22,184,439 8.100 $ 22,629,984 8.100
Transit $ 2,601,879 0.950 $ 2,654,134 0.950
Tort Liability $ 1,109,907 0.405 $ 1,111,495 0.398
Library $ 739,481 0.270 $ 754,333 0.270
Subtotal: $ 26,635,705 9.725 $ 27,149,946 9.718
Special Revenue Levies:
Emergency $ 703,877 0.257 $ 662,137 0.237
Employee Benefits $ 10,710,236 3.911 $ 10,641,456 3.809
Subtotal: $ 11,414,113 4.168 $ 11,303,593 4.046
Debt Service $ 12,210,753 4.458 $ 13,526,863 4.842
Total City Levy Property
Taxes: $ 50,260,571 18.351 $ 51,980,402 18.605
% Change from
prior year: 10.73% 2.79% 3.42% 1.39%
Agland Levy $ 4,227 3.004 $ 4,227 3.004
Total Property Taxes $ 50,264,798 ---- $ 51,984,629 ----
16
Property Tax Levies
The FY2010 proposed property tax rate for the City of Iowa City is less than one percent (.77%) higher than
the previous year, per $1,000 of taxable assessed valuation.
Estimated Property Tax on $100,000 Residential Valuation
(Iowa City portion)
FY2009
$780.96
FY2010
$813.89
FY2009 FY2010
Taxable Valuation 44,080$ 45,589$
City Levy 17.717$ 17.853$
Property Taxes 780.96$ 813.89$
The general property tax levy of $8.10 is used to support General Fund services such as those provided by
the Police and Fire Departments, Library, Senior Center, Parks and Recreation. This levy cannot exceed
$8.10 per $1000 of taxable assessed valuation per State law.
The Library tax levy of $.27 was voted in by a majority of the residents in 1991. The initial levy was used to
expand Library services and continues to maintain that level of service.
The Transit levy of $.95 is a "general" levy for transit operations which cannot exceed $.95 per $1,000 of
taxable assessed valuation.
The Tort Liability levy has no maximum and is based on estimated insurance premiums and claim losses
within the self-insured retention. The levy rate for FY2010 is estimated at $0.420, compared to $0.419 for
FY2009. The City’s self-insured retention amount is $400,000 per occurrence for worker’s compensation,
$500,000 for liability claims and $100,000 for city property claims.
The Emergency levy is $0.256 for FY2010. The general levy must be at $8.10 before this levy can be used.
The levy cannot exceed $0.27.
The Employee Benefits property tax levy is used for the employer cost of the following benefits for
employees within the General Fund:
Health Insurance
Life Insurance
Disability Insurance
Worker's Compensation insurance premiums and claims
Unemployment Compensation
Social Security (FICA - 7.65%)
Iowa Public Employees Retirement System costs (IPERS)
Municipal Fire and Police Retirement System of Iowa (MFPRSI)
17
The Employee Benefit levy for FY2010 is estimated at $3.637, compared with the FY2009 levy of $3.625.
This is projected to increase to $3.911 in FY2011 due to anticipated adjustments in the MFPRSI pension
rate, which is set annually by the state & based on an actuarial review.
The Debt Service levy provides funding for principal and interest payments on outstanding general obligation
bonds. In FY2010, this levy is $4.219, compared with $4.303 in FY2009.
B. GENERAL FUND REVENUE
General Fund revenue is projected at $53.6 million in FY2010. A comparison of total General Fund revenue
between fiscal years is challenging due to a number of one-time transactions and events. A more useful
discussion by revenue classification is provided on the following pages.
FY2008 FY2009 FY2010 FY2011 FY2012
Actual Amended Budget Projected Projected
1. Property Taxes 30,107,850 31,834,083 33,597,917 35,292,369 35,654,925
2. Other City Taxes 1,160,175 1,202,531 1,205,536 1,226,290 1,247,394
3. Licenses & Permits 1,284,874 1,308,040 1,325,023 1,400,023 1,336,523
4. Use Of Money & Property 1,717,117 918,544 419,755 419,755 419,755
5. Intergovernmental 3,957,610 10,025,331 3,640,047 3,657,905 3,870,190
6. Charges For Services 4,372,269 4,517,802 5,508,939 5,508,939 5,508,939
7. Miscellaneous 1,590,785 1,841,471 1,829,453 1,829,453 1,829,453
8. Other Financing Sources 2,691,775 4,172,689 6,128,856 368,318 330,274
Total Revenue:46,882,455$ 55,820,491$ 53,655,526$ 49,703,052$ 50,197,453$
% change from prior year 5.0%19.1%-3.9%-7.4%1.0%
FY 2010 Budget
General Fund Revenue
$53,655,526
Use Of Money &
Property
1%
Misc.
4%
Charges For
Services
10%
Intergovt.
7%Other
City
Taxes
2%
Licenses &
Permits
2%
Other
Financing
Sources
11%Property Taxes
63%
18
General Fund revenue is summarized into eight major categories. An analysis of each category
follows:
1. Property Taxes - Property tax revenue of $33.6 million is projected to provide 63% of General
Fund revenue in FY2010. The taxable valuation for general levy is expected to increase 4.4%
from FY2009.
2. Other City Taxes – This category, estimated at $1.2 million in FY2010, includes revenue from the
state-administered Hotel/Motel tax and the Gas & Electric Excise Tax. Hotel Motel tax is a seven
percent (7%) tax on gross hotel/motel room rental receipts and is distributed as follows:
Convention & Visitor's Bureau 25.00%
Police Patrol 47.50%
Parks & Recreational Facilities 27.50%
Total Hotel Motel 7% Tax 100.00%
The Gas and Electric Excise tax is a state-legislated reclassification from property tax to usage tax.
The tax is based on property tax rates and valuations supplied by the State Department of Revenue
and Finance.
3. Licenses & Permits – Rental Inspection Fee Increase: Effective July 1, 2009
This category consists of revenue received for building and rental housing permits/inspections,
plumbing license and taxi license fees; beer, liquor and cigarette permit/license fees (state
regulated), sign permits, burial permits, animal licensing and some miscellaneous fees. The
FY2010 budget for Licenses and Permits is estimated at $1.3 million, slightly more than FY2008
actual and FY2009 budget.
City Council approved a 19.5% increase in rental inspection permit fees to be effective July 1, 2009,
which were last increased in FY2006. This increase is projected to generate an additional $120,500
annually, when averaged over the next two-year inspection cycle, FY2010-2011; and reduce
reliance on general levy.
Effective January 1, 2008, the State of Iowa assumed responsibility for electrical, plumbing and
mechanical licensing. Revenue associated with this role has now shifted to the state. Receipts
from this activity totaled $58,750 for Iowa City in FY2008.
4. Use of Money & Property – Parking Garage Permit Increase: Effective July 1, 2009
This revenue source consists of interest income, parking permits at the Court Street
Transportation Facility, farmer’s market booth rentals, park shelter rental fees, locker rentals, and
Senior Center parking permits. The category is budgeted at $419,755 in FY2010, down
significantly from FY2008 actuals due to an anticipated decrease in interest income. The effect
of current interest rates is projected to compound in FY2011 - 2012 as investments come due
and are reinvested at a lower rate.
City Council approved an increase in parking permits, to be effective July 1, 2009. Permits in the
Court Street Transportation Facility (a Transit Division / General Fund asset) will increase from
$60/month to $80/month. This is projected to generate an additional $121,000 in FY2010 over
prior years.
19
5. Intergovernmental revenue is estimated at $3.6 million in FY2010, including state and federal
grants, 28-E agreements and contracts with local governmental entities.
The majority of intergovernmental revenue is the result of 28E agreements with local entities for services
provided to area residents, as shown in the following schedule. The largest of these agreements is for
fire protection services to the University of Iowa, estimated at $1.6 million in FY2010, with $1.3 million
receipted into the General Fund. The remainder is deposited into the Employee Benefits Fund as
reimbursement for a percentage of Fire employee benefits.
FY2008 FY2009 FY2010 FY2011 FY2012
Intergovernmental Funding Actual Amended Budget Projected Projected
Local Governmental: 28E Agreements
Coralville, Johnson County & Other
Governments - Animal Services 159,903 131,000 131,000 131,000 131,000
IC Comm. Schools - Mercer Pool 91,159 86,766 100,384 104,567 109,006
County, Univ Heights, Hills - Library 365,353 394,491 419,606 427,914 442,627
Johnson County - Senior Center 75,000 75,000 75,000 75,000 75,000
University Heights - Transit Services 29,804 29,804 29,804 29,804 29,804
University Heights - Emergency Radio 52,844 42,275 42,275 - -
University of Iowa - Fire Protection 1,206,986 1,330,136 1,349,517 1,424,077 1,617,157
Local Governmental Revenue:1,981,049 2,089,472 2,147,586 2,192,362 2,404,594
State Revenue:
Monies & Credits 41,780 24,739 24,739 24,739 24,739
Transit Assistance 383,078 364,492 364,492 364,492 364,492
Transit - Federal Pass-thru 200,257 179,998 60,832 60,832 60,832
Public Safety Grants 166,553 81,417 134,987 134,987 134,987
FEMA Match - State Portion 6,606 710,000 - - -
Total State Revenue:798,274 1,360,646 585,050 585,050 585,050
Federal Revenue:
Transit FTA Operating Grants 1,104,494 873,006 873,006 873,006 873,006
Transit - Route Expansion Grant (JARC)- 120,000 - - -
Public Safety Grants 14,090 16,306 16,328 16,328 16,328
FEMA Assistance 52,685 5,525,000 - - -
Total Federal Revenue:1,171,269 6,534,312 889,334 889,334 889,334
Misc. Local Govt. Share - Joint Public Safety - 50,000 26,250 - -
Misc. Other Intergovernmental 17,581 2,640 3,566 2,898 2,951
Total - Intergovernmental Funding: 3,968,173$ 10,037,070$ 3,651,786$ 3,669,644$ 3,881,929$
6. Charges for Services are projected to increase by $1.0 million or 21.9% in FY2010, over the FY2009
budget. The majority of this increase was the result of revisions to the administrative chargeback. This
is a charge to the City’s proprietary funds for services rendered by administrative divisions, which
includes City Council, City Manager, City Clerk, City Attorney, Personnel and the Finance Department.
The formula for distributing these costs was reviewed during preparation of the FY2010 proposed
budget and was revised to appropriate costs based on expenditures. The revised schedule of charges
is projected to recover $2.6 million of General Fund operating costs, compared with $1.6 million in prior
years.
Other revenue in this category include fees for Transit, Parks and Recreation, Police, Fire, Housing &
Inspection Services, Animal Control services and Cemetery services.
20
7. Miscellaneous Revenue - Parking Violation Fine Increase: Effective July 1, 2009
Miscellaneous revenue of $1.8 million in FY2010 includes a variety of different revenue sources. The
largest is parking fines, which are budgeted at $593,000 for FY2010. Other miscellaneous revenue
includes magistrate court fines and surcharges related to code enforcement ($316,000) and library fines
($198,000).
City Council has approved an increase in parking violation fines, to be effective July 1, 2009. Fines
were last increased in FY2004. Violations which are not related to expired meters are deposited into the
General Fund. These tickets, which are currently $10.00, are proposed to increase to $15.00.
Violations for parking in a commercial loading zone would increase to $25.00/ticket. This measure is
cited as part of ongoing efforts to relieve congestion in commercial parking areas in downtown Iowa
City. Projections for FY2010 incorporate an estimated increase of twenty-five percent (25%) over the
prior year.
8. Other Financing Sources include proceeds from the sale of assets, allocation of funds to equipment
replacement reserves and transfers in of property tax revenue. This category is budgeted at $6.1 million
in FY2010 and includes the following one-time transactions, as directed by City Council:
A $3.9 million interfund loan has been budgeted from Landfill for development of infrastructure
following land acquisition along 420th Street during FY2009. Proceeds from the sale of this property
as intended for industrial / economic development will go to repayment of the loan.
A $1.0 million interfund loan has been budgeted from Landfilll to provide partial funding for Fire
Station #4 construction costs.
A $500,000 interfund loan from Landfill to the General Fund is budgeted for provision of loans to
private businesses who are upgrading fire safety sprinkler systems to A-2 occupancy code
requirements. Loans will be accounted for through the Building Inspection Division. Current
budget authority is for $500,000 in FY2009 and $500,000 in FY2010.
Loan repayments from participating businesses are also budgeted within the Other Financing
Sources category, with estimate of $100,000 in FY2009 and $200,000 for FY2010 forward. Actual
transactions will be determined by the level of participation within the program and timing of the
individual business owner’s compliance (there is a three-year grace period).
General Obligation bond proceeds of $290,000 have been dedicated by City Council for payout as a
loan to The Housing Fellowship in FY2010. These funds will help finance development of twenty-
two affordable rental housing units in Olde Towne Village, Village Green and the Mount Prospect
addition of the Grant Wood neighborhood.
21
22
23
C. GENERAL FUND – EXPENDITURES
The General Fund expenditure budget in FY2010 is $54,612,121. A comparison of expenditures
across fiscal years is challenging due to a number of one-time transactions and events as
discussed by major expenditure classification on the following page.
FY2008 FY2009 FY2010 FY2011 FY2012
Actual Amended Budget Projected Projected
1. Personnel 31,249,893 33,119,715 33,573,816 35,269,316 36,153,433
2. Services 8,144,807 10,213,393 10,027,813 9,164,489 9,410,746
3. Supplies 2,007,985 9,399,537 2,327,199 2,453,910 2,507,968
4. Capital Outlay 1,709,967 4,871,664 1,439,587 1,575,462 1,233,691
5. Other Financial Uses 6,156,458 1,494,934 6,878,706 730,058 696,279
6. Contingency - - 365,000 370,000 1,775,000
Total Expenditures: 49,269,110 59,099,243 54,612,121 49,563,235 51,777,117
% Change 14.0% 20.0%-7.6%-9.2%4.5%
FY2010 Proposed Budget
General Fund Expenditures by Category
-
10
20
30
40
50
60
70
FY2008 FY2009 FY2010 FY2011 FY2012
Fiscal Year (FY)
Mi
l
l
i
o
n
s
o
f
D
o
l
l
a
r
s
(
$
)
Other Financial Uses
Capital Outlay
Supplies
Services
Personnel
1. Personnel – Personnel costs include salaries and benefits, including health, life, and disability
insurance, employer share of FICA and IPERS, and Police/Fire retirement contributions. Personnel
costs account for approximately 61% of budgeted expenditures within the General Fund in FY2010.
There are no new positions approved for FY2010 within the General Fund.
Salaries and benefits for most employees are determined by collective bargaining agreements with one
of three unions: AFSCME (Local #183), the Police Labor Relations Organization (PLR) of Iowa City, and
24
the Iowa City Association of Professional Fire Fighters, IAFF, AFL-CIO (Local #610). Administrative,
confidential, supervisory and temporary employees specified in Chapter 20 of the Code of Iowa are
excluded from these unions and the respective agreements. Salaries and benefit appropriations are
determined by the City Council upon the recommendation of the City Manager.
AFSCME ratified a three-year contract that spans July 1, 2007 through June 30, 2010. This agreement
includes an adjustment to wages of 3.1% on July 1, 2009, in addition to merit increases. Contracts for
FY2010 are currently being negotiated with both the PLR and IAFF, AFL-CIO (Local #610) for July 1,
2009 through June 30, 2010. Annual wage adjustments of 3.1% were used for FY2010 projections,
equal to the rate used for AFSCME. Adjustments to the administrative / confidential pay plan are the
same as AFSCME for FY2009 - 2010, per City Council resolution.
The employer portion of the IPERS retirement rate increases from 6.35% in FY2009 to 6.65% in
FY2010 and 6.95% in FY2011. The MFPRSI (Municipal Fire & Police Retirement) rate is set annually
by the state and based on an independent actuarial opinion. The rate for FY2010 was announced in
November, 2008, at seventeen percent (17%). Based on recent market conditions, a significant
increase is anticipated for FY2011 and has been estimated accordingly at 25%, with FY2012 set
more conservatively at 20%. To provide perspective, the rate in FY2008 was 25.48%. Health
insurance is estimated to increase six percent (6%) in FY2010.
2. Services - This category includes printing, insurance, training and education, postage, various service
contracts; repair and maintenance costs on vehicles, buildings and equipment, utility costs, charges for
internal services, and funding for local community events and human service agencies. Fiscal year
2010 expenditures are budgeted at $10.0 million.
Payout of the A-2 occupancy loans are budgeted at $500,000 in FY2009 and FY2010. When
excluding A-2 occupancy loans from our analysis, the General Fund budget for Services is seventeen
percent (17%) higher in FY2010 than FY2008 actuals, an 8.5% increase annually over two years.
Significant items identified in FY2010 include payout of a $290,000 loan to the Housing Fellowship for
development of affordable housing, $150,000 funding for economic development assistance (includes
a $50,000 council designation to the Englert Theater, beginning in FY2010); $105,000 for biennial city
elections; and anticipated increases in property and liability insurance premiums, utilities, software
maintenance agreements and operating costs for paratransit services.
3. Supplies - Supplies consist primarily of commodities that are consumed or depleted, such as office
and cleaning supplies, vehicle fuel and materials for repair and maintenance of buildings, streets, and
equipment. The FY2010 budget is $2.3 million, up sixteen percent (16%) from FY2008 due primarily
to one-time transit bus repairs of $190,000 and a $150,000 increase in diesel fuel for Transit buses.
Flood-related expenditures are budgeted under Supplies at $7.2 million in FY2009.
4. Capital Outlay – General Fund capital outlay is budgeted at $1.4 million in FY2010 and includes
police vehicle replacements, library materials, operating equipment, and building maintenance and
improvements.
5. Other Financial Uses – This category is budgeted at $6.9 million in FY2010 and includes the
following council-directed use of General Fund monies:
Funding of $3.9 million is budgeted for development of infrastructure following land acquisition
along 420th Street during FY2009. Funding is provided through an interfund loan from Landfill
to the General Fund and proceeds from the sale of this property for industrial / economic
development will go to repayment of the loan.
25
Capital project funding of $2.0 million is budgeted from General Fund for construction of Fire
Station #4. Of this amount, $1.0 million will come from General Fund cash balance and $1.0
million from an interfund loan to General Fund, to be repaid over ten (10) years.
Funding of $500,000 is budgeted in both FY2009 and FY2010 for provision of loans to private
businesses as they upgrade fire safety sprinkler systems to A-2 occupancy code requirements.
Loans will be accounted for through the Building Inspection Division.
6. Contingency has been set at $365,000 in FY2010. Contingency in FY2012 is budgeted at $1.8
million due to a 27th pay period during the fiscal year. This occurs once every eleven years as
dictated by how pay periods span the beginning / end of each fiscal year.
D. GENERAL FUND YEAR-END CASH BALANCE
During the FY2010 budget process, city council revised the reserve policy for General Fund cash balance
so that unreserved / unrestricted cash balance in excess of twenty-five percent (25%) of expenditures be
considered for property tax relief. This section of the Financial and Fiscal policies also states that
General Fund cash balance shall not drop below fifteen percent (15%) of expenditures in order to ensure
sufficient cash flow throughout the fiscal year. The following table depicts the General Fund Operating
cash position for fiscal years 2008 through 2012.
In accordance with Council’s revised policy, cash balance is being utilized during fiscal years 2009 and 2010
to provide financing for unrecoverable flood-related expenditures, land acquisition costs along 420th Street
and construction costs associated with Fire Station #4. The unreserved / unrestricted cash balance is
projected to be 20.9% of budgeted expenditures at the end of FY2010.
Expenditures from the Library Computer Replacement Reserve are budgeted in excess of reserved cash
balance and will require a reduction in proposed expenditures or designation of alternative funding.
FY2008 FY2009 FY2010 FY2011 FY2012
Actual Amended Budget Projected Projected
Unreserved 15,862,601$ 12,493,947$ 11,428,970$ 11,550,339$ 9,907,766$
Reserved
(Available for current and / or future operations)
Library Equipment Replacement Reserve 80,134 73,716 71,091 82,374 91,562
Park Land Acquisition Reserve 161,906 138,960 138,960 138,960 138,960
Library Computer Replacement Reserve 66,803 27,048 (18,755) (100,321) (97,800)
Park Land Development Reserve 23,437 23,437 23,437 23,437 23,437
Transit Reserve: Grant & Levy Restrictions 688,886 789,408 905,206 949,706 949,706
Transit Capital: State Restricted 411,791 411,791 411,791 411,791 411,791
Fire Equipment Replacement Reserve 309,342 367,841 408,853 453,084 504,284
Sub total - Reserved 1,742,300$ 1,832,202$ 1,940,584$ 1,959,032$ 2,021,941$
Restricted (Develop/Constr Escrows) 1,139,924 1,139,924 1,139,924 1,139,924 1,139,924
General Fund Ending Cash Balance 18,744,825$ 15,466,073$ 14,509,478$ 14,649,295$ 13,069,631$
General Fund Expenditures 49,269,110$ 59,099,243$ 54,612,121$ 49,563,235$ 51,777,117$
Unrestricted Balance % of Expenditures 32.2%21.1%20.9%23.3%19.1%
General Fund Unreserved, Reserved & Restricted Ending Cash Balances
26
As mentioned previously, General Fund cash balance is relied upon to provide cash flow during the first
quarter of the fiscal year as the majority of property taxes are not received until October/November. The
following chart demonstrates how expenditures have exceeded receipts in the first three months over the
past ten years.
3 Months @
Sept. 30 Receipts Expenditures Shortfall
FY2009 6,496,526$ 13,877,093$ (7,380,567)
FY2008 7,041,379 12,484,773 (5,443,394)
FY2007 7,881,225 13,014,632 (5,133,407)
FY2006 6,315,525 12,105,987 (5,790,462)
FY2005 6,040,943 10,889,278 (4,848,334)
FY2004 4,595,488 11,049,590 (6,454,102)
FY2003 4,806,797 9,410,440 (4,603,643)
FY2002 4,387,107 8,818,510 (4,431,403)
FY2001 4,449,250 9,233,286 (4,784,036)
FY2000 4,321,697 8,730,848 (4,409,151)
27
E. DEBT SERVICE FUND
This fund accounts for annual principal and interest payments due on general obligation debt of the City.
Funding is provided by the debt service property tax levy, transfers from Water Operations, loan repayments
and TIF district tax revenue. FY2009 through 2012 G.O. bond issues are estimated at $6.63 million, $9.3
million, $11.0 million and $11.4 million, respectively.
As stated in the City's Fiscal Policy, "Debt incurred as a general obligation of the City of Iowa City shall not
exceed statutory limits: presently 5% of the total assessed value of property within the corporate limits as
established by the City Assessor." The following schedule and graph depict current and estimated future
debt margins for the City at the time of budget adoption. Property valuations for FY2010 are estimates from
the County Auditor’s office, FY2011 and FY2012 are estimated at four and two percent (4%, 2%) growth,
respectively.
Fiscal
Year
Total (100%)
Property
Valuation
Allowable
Debt Margin
(5% of Total
Property Val.)
Outstanding
Debt
at July 1
Debt as % of
Allowable
Debt Margin
Outstanding
Debt as a
Percentage of
Total Valuations
FY00 2,416,782,699 120,839,135 46,165,000 38%1.9%
FY01 2,591,030,038 129,551,502 41,190,000 32%1.6%
FY02 2,692,448,464 134,622,423 61,565,000 46%2.3%
FY03 2,909,644,383 145,482,219 85,260,000 59%2.9%
FY04 2,962,505,107 148,125,255 79,100,000 53%2.7%
FY05 3,195,170,779 159,758,539 85,085,000 53%2.7%
FY06 3,214,973,037 160,748,652 85,290,000 53%2.7%
FY07 3,732,590,506 186,629,525 85,060,000 46%2.3%
FY08 3,931,783,525 196,589,176 85,840,000 44%2.2%
FY09 4,267,009,276 213,350,464 84,655,000 40%2.0%
*FY10 4,366,357,701 218,317,885 83,937,580 38%1.9%
*FY11 4,542,205,002 227,110,250 83,472,660 37%1.8%
*FY12 4,546,125,774 227,306,289 81,760,240 36%1.8%
* Estimate
G.O. Debt Outstanding
- by Fiscal Year -
0
50
100
150
200
250FY 0 3 F Y 0 4 FY05 F Y 0 6 F Y 0 7 FY08 F Y 0 9 *F Y 10 *FY11 *F Y 1 2
Fiscal Year (FY)
Mi
l
l
i
o
n
s
o
f
D
o
l
l
a
r
s
(
$
)
Allowable Debt Margin
Outstanding Debt
at July 1
* Estimated
28
Iowa City’s internal fiscal policy further specifies that the "debt service levy shall not exceed 25% of the city
levy in any one fiscal year." The following chart shows the debt service levy as a percentage of the city levy
for FY2003 through 2012. Fiscal years 2010, 2011, and 2012 are based on estimated financing
requirements for capital projects, changes in other levy rates (based on operating costs) and future changes
in property valuations. The debt service levy is projected to exceed the twenty-five percent (25%) policy in
FY2012.
Debt Service Levy
As a Percentage of
Total Property Tax Levy
25%
23%
26%
22%22%
24%24%24%
26%
23%
0%
5%
10%
15%
20%
25%
30%2003 2004 2005 2006 2007 2 008 20 09 *2010 *2 011 *20 12
Fiscal Year (FY)* Estimated
(25% Recommended Maximum)
Note: Fiscal years 2007 and 2008 had one-time reductions in the debt levy of $638,200 and $934,947
which resulted in foregone debt levies of $0.27 and $0.385 respectively, funded from the General Fund.
F. INTERNAL SERVICE FUNDS
Internal service funds include Equipment / Fleet Maintenance, Central Services, Risk Management Loss
Reserves, Health and Dental Insurance Reserves and the Information Technology Services Fund. Each of
these activities is funded by the departments and divisions which utilize their services, with projected
increases as follows:
Phone service and administration fees are projected to increase 8% in FY2010 to provide for
continued upgrades / improvements to the phone system.
Equipment charges for vehicle operations, which includes fuel costs, are projected to increase 2.5%
in FY2010 and 2.0% thereafter.
Health and dental insurance premiums are projected to increase 6% in FY2010 and 5% in FY2011
and FY2012.
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G. SPECIAL REVENUE FUNDS
Special Revenue Funds include Employee Benefits, Community Development Block Grant (CDBG), the
HOME Program, Road Use Tax, Johnson County Council of Governments (JCCOG), special assess-
ments, and Tax Increment Financing (TIF) funds.
1. Community Development Block Grant (CDBG) & HOME Program – These funds account for
revenue from the U.S. Department of Housing and Urban Development and are restricted in use for
eligible projects as defined by federal regulations. Monies are utilized by both businesses and
individual homeowners for property rehabilitation and community development initiatives. In
FY2010, CDBG federal revenue is budgeted at $841,000 and the HOME program at $760,000.
Disaster relief funds totaling $22.6 million are budgeted for hazard mitigation (including the home-
buyout program) and business / residential assistance starting in FY2009. This includes grant
monies from FEMA, CDBG and the JUMPSTART Iowa Fund, with receipts and expenditures thru
the first week of June, 2009, at $2.95 and $3.35 million; respectively.
2. Road Use Tax & TIME-21 - The Road Use Tax Fund provides for street and traffic engineering
maintenance, planning and construction-related costs. These activities are financed through state-
distributed Road Use Tax revenue, which is based on vehicle registration fees, motor vehicle fuel
taxes, rental vehicle excise taxes and a use tax on trailers.
During Iowa’s 2007 and 2008 legislative sessions, additional revenue was allocated to cities for
street maintenance and construction through the state’s TIME-21 Fund. Revenue projections
released by the Iowa Department of Transportation in September, 2008, suggest the increase in
revenue to Iowa City from TIME-21 to be $330,000 in FY2010, $474,000 in FY2011 and $620,000
in FY2012.
Both Road Use Tax and TIME-21 funds are to be distributed back to cities based on a per capita
formula. Projections from November, 2008, are for $89.50, $92.00 and $94.00 per capita in fiscal
years 2010 – 2012, respectively. Based on an Iowa City population of 62,380; receipts would total
$5.58 million, $5.74 and $5.86 million in fiscal years 2010 – 2012. As noted by both the IDOT and
the League, these projections are subject to dramatic changes as consumers respond to changing
economic conditions.
NOTE: Revenue projections are not keeping pace with expenditures, as demonstrated by
the declining cash balance across the years FY2008 – 2012. In the absence of additional
revenue, capital project and/or operational costs will need to be reduced in the immediate
future.
3. Tax Increment Financing Districts have been established in various locations in Iowa City to
encourage economic development. TIF revenues are used to repay debt incurred for specific
projects and to pay property tax rebates on increased valuation per development-specific
agreements within the districts. Scott Six Industrial Park will be expiring June 30, 2009, releasing its
full valuation for all taxing bodies in FY2010. The City – University Project, which includes Plaza
Towers, has seen sufficient growth in valuations and early retirement of the 2004 GO is anticipated
in FY2013 – 14.
H. BUSINESS-TYPE ACTIVITES
Business-type funds include Parking, Wastewater Treatment, Water, Refuse, Landfill, Airport,
Broadband Telecommunications, Housing Authority, and Stormwater Management. These activities are
primarily self-supported through user fees for services provided. The exceptions to this are the Iowa
City Airport and Housing Authority. The Iowa City Airport is not self-supported at this time and receives
property tax subsidy. The Housing Authority is primarily a federally funded program.
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1. Parking Fund – Fee Increase: Effective July 1, 2008
Transportation Services completed an analysis of revenue requirements in view of potential
development of a multi-use parking facility on the former St. Patrick’s Church site on South Linn
Street. This lot was purchased during the spring of 2008 with a combination of Parking Impact Fees
and an interfund loan to the Parking Division. Loan repayments are $183,414 annually, beginning in
FY2009.
The following changes in parking fines and fees were approved by City Council on June 16, 2009:
On-street hourly parking will increase from $.75/hour to $1.00/hour in the downtown area bound
by Gilbert, Burlington, Clinton and Market Streets. This is a thirty-three percent (33%) increase
in rates and revenue projections are for an increase of twenty-five percent (25%) as staff
anticipates customers will utilize other parking options. It is also intended that the increase might
steer long-term parking customers to the parking garages.
Parking citations for expired meters will increase from $5.00/ticket to $10.00/ticket, with a $3.00
discount available if paid within seven (7) calendar days.
Monthly permits will increase from $60/month to $80/month for all parking garages. Permits for
parking lots would remain at $60/month.
Following is an estimate of the financial impact of each change:
Revenue Source
FY2008
Actual
FY2010
Budgeted Impact
On Street Meters 580,000 725,000 145,000
Expired Meter Citations 627,427 878,400 250,973
Monthly Garage Permits 788,793 943,750 154,957
Total 1,996,220$ 2,547,150$ 550,930$
Capital project funding includes $630,000 in FY2009 for parking garage access control equipment,
and $300,000 in both FY2009 and 2010 for garage elevator upgrades.
1. Water Fund -
No change in user fees is recommended at this time as fund balance remains healthy.
2. Wastewater Treatment Fund –
No change in user fees is recommended at this time as fund balance remains healthy.
3. Refuse Collection - Fee Increase: $.50 in FY2010, and 2011
Refuse fees will increase $.50 per month on July 1, 2009, as approved by City Council at their April
6, 2009, meeting. This increases the minimum bill to $15.00/month. Future years include an
additional $0.50 increase in FY2011. Personnel and vehicle operations (including fuel) account for
the majority of costs in this fund. Roll-out refuse carts continue to be budgeted at $66,000 annually.
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5. Landfill Operations -
Landfill fees remain unchanged at this time.
A new staff position was approved in FY2010 for an Environmental Coordinator. This position will
be charged with coordinating green house gas reduction programs with City departments and within
the community. Other responsibilities are to include natural areas management, regulatory
monitoring and reporting within the Public Works Department.
Capital project funding includes $2.0 million in FY2010 for construction of the Eastside Recycling
Center and $7.0 million in FY2009 for construction of a ‘super’ cell.
4. Airport Operations -
The FY10 budget maintains current operations and includes continued repayment of interfund loans
used to construct hangars at the airport. General Fund support is $130,000, annually.
Capital project expenditures budgeted in FY2009 are expected to extend into FY2010 and will
require additional funding, as reflected by the projection for a negative cash balance at June 30,
2009. A number of additional capital improvement projects are budgeted in FY2010 – 2013 in
anticipation of FAA for grant funding.
In FY2011, a large bay hangar will be constructed for the Fixed Based Operator to lease. Project
costs are estimated at $1.0 million, with $500,000 in general obligation bond funding.
5. Broadband Telecommunications -
This fund accounts for activities within the Cable TV division. Functions include administration of
the cable television franchise agreement, local programming on City Channel 4 and interactive
services on InfoVision Channel 5. The primary funding source for this division is a five percent
(5%) cable franchise fee, which is part of a non-exclusive franchise agreement and budgeted at
$679,428 in FY2010.
The Community Television Service (CTS), a project of the Cable TV division, produces programs
for nonprofit organizations and cablecasts local public meetings. The CTS receives 55 cents per
cable customer per month to produce this programming under the new agreement with
Mediacom. Revenue from this pass-through fee is estimated at $124,620 for FY2010.
6. Stormwater Management -
Iowa City is now required to implement various programs related to stormwater quality under a
federally mandated Stormwater Permit. Stormwater user fees are $2.00/month per Equivalent
Residential Unit (ERU) and are budgeted at $614,682 in FY2010.
Reconstruction of the Sandusky Stormwater retention basin is budgeted for $635,000 in FY2009
and anticipated to continue into FY2010. Future projects include replacement of a box culvert on
North Gilbert Street, south of Kimball Road for $360,000 in FY2011.
7. Housing Authority
The Iowa City Housing Authority is projected to receive $6.8 million in federal funding through the
U.S. Department of Housing and Urban Development (H.U.D.) in FY2010. These monies finance
programs to assist individuals and families in obtaining affordable housing.
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GOVERNMENT ACTIVITIES
PUBLIC SAFETY
Police
Fire
Housing & Inspection Services
Animal Services
Deer Control
F
Y
2
0
1
0
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