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Home My WebLink AboutFY2008 Financial Plan Part IMaster Plan Aerial About the photos on the front cover: Upper left: Sand Lake Recreation Area master plan (page C-13) Upper right: Summer T-ball League Lower left: Robert A. Lee Recreation Center window replacement project Lower right: Benton Hill ParkBottom: Downtown Iowa City night skyline City Council: (First row, L to R): Ross Wilburn, Mayor; Mike O’Donnell; Bob Elliott (Back row): Dee Vanderhoef; Connie Champion; Regenia Bailey; Amy Correia City Manager: Finance Director: Stephen J. Atkins Kevin O’Malley Budget Analyst: Deb Mansfield 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 the 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, Information Technology Services and Purchasing. 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 FINANCIAL PLAN FISCAL YEARS 2008 – 2010 TABLE OF CONTENTS PAGE CITY MANAGER’S LETTER............................................................................................................. 1 FINANCIAL PLAN OVERVIEW ........................................................................................................ 3 ORGANIZATIONAL CHART............................................................................................................. 4 FINANCIAL AND FISCAL POLICIES............................................................................................... 5 SUMMARIES AND CHARTS: Financial Plan Analysis ............................................................................................................... 13 Property Tax ......................................................................................................................... 13 General Fund Revenue ........................................................................................................ 16 General Fund Summary ....................................................................................................... 20 General Fund Expenditures by Division............................................................................... 21 General Fund Year-end Cash Balance ................................................................................ 25 Debt Service Fund................................................................................................................ 26 Internal Service Funds.......................................................................................................... 28 Special Revenue Funds........................................................................................................ 28 Reserve Funds...................................................................................................................... 29 Business Type Funds ........................................................................................................... 29 All Funds – Graphs...................................................................................................................... 31 Transfers-In................................................................................................................................. 33 Transfers-Out .............................................................................................................................. 36 New Position Requests............................................................................................................... 39 Personnel Listing by Department - Full-Time Equivalents.......................................................... 40 PUBLIC SAFETY: Police Department: Summary............................................................................................................................... 43 Administration....................................................................................................................... 46 Patrol..................................................................................................................................... 47 Criminal Investigation ........................................................................................................... 48 Records................................................................................................................................. 49 Crossing Guards................................................................................................................... 50 Emergency Communications................................................................................................ 50 Grants ................................................................................................................................... 51 Fire Department: Summary .......................................................................................................... 52 Fire Equipment Replacement Reserve.................................................................... 54 Public Safety Reserve................................................................................................................. 54 Housing & Inspection Services: Summary .............................................................................................................................. 55 Administration....................................................................................................................... 56 Building Inspection................................................................................................................ 57 Housing Inspection ............................................................................................................... 57 Animal Services Summary............................................................................................................................... 58 Animal Gifts & Memorials ..................................................................................................... 60 Deer Control................................................................................................................................ 60 PUBLIC WORKS: Summary..................................................................................................................................... 61 Public Works Administration ....................................................................................................... 62 Engineering ................................................................................................................................. 63 Street System Maintenance ........................................................................................................ 64 Traffic Engineering...................................................................................................................... 65 Public Transit............................................................................................................................... 66 Transit Reserve........................................................................................................................... 68 Energy Conservation................................................................................................................... 68 Road Use Tax (RUT)................................................................................................................... 69 CULTURE AND RECREATION: Library: Summary............................................................................................................................... 71 Operations ............................................................................................................................ 72 Replacement Reserves ........................................................................................................ 73 Reimbursables & Escrows.................................................................................................... 74 Parks & Recreation: Summary............................................................................................................................... 75 Administration....................................................................................................................... 77 Parkland Acquisition Reserve............................................................................................... 77 Parks..................................................................................................................................... 78 Recreation............................................................................................................................. 79 Cemetery .............................................................................................................................. 83 Perpetual Care...................................................................................................................... 83 Forestry................................................................................................................................. 84 CBD Maintenance................................................................................................................. 85 Government Buildings .......................................................................................................... 86 Senior Center: Summary............................................................................................................................... 87 Operations ............................................................................................................................ 88 Gift Fund ............................................................................................................................... 89 New Horizons Band.............................................................................................................. 89 COMMUNITY AND ECONOMIC DEVELOPMENT: Planning and Community Development: Summary............................................................................................................................... 91 PCD Administration .............................................................................................................. 93 Public Art............................................................................................................................... 93 Urban Planning..................................................................................................................... 94 Neighborhood Services ........................................................................................................ 94 Economic Development – General Fund.............................................................................. 95 Economic Development – Capital Fund............................................................................... 95 Non-Grant Community Development ................................................................................... 96 TARP – G.O. Bond Rehabilitation ........................................................................................ 96 Community Development Block Grant (CDBG).................................................................... 97 H.O.M.E. Program ................................................................................................................ 98 Emergency Shelter Grant..................................................................................................... 99 Peninsula Apartments........................................................................................................... 99 Tax Increment Financing Districts (TIF) ............................................................................... 100 Johnson County Council of Governments (JCCOG): JCCOG Summary .......................................................................................................... 103 Administration................................................................................................................. 105 Transportation Planning ................................................................................................. 106 Rural Community Assistance......................................................................................... 106 Human Services Planning.............................................................................................. 107 Solid Waste Management.............................................................................................. 107 GENERAL GOVERNMENT: Administrative Divisions Summary.............................................................................................. 109 City Council ................................................................................................................................. 110 City Manager ............................................................................................................................... 110 City Clerk..................................................................................................................................... 111 Police Citizens’ Review Board .................................................................................................... 111 City Attorney................................................................................................................................ 112 Personnel .................................................................................................................................... 113 Human Rights.............................................................................................................................. 114 Non-Operational Administration.................................................................................................. 115 Aid to Agencies ..................................................................................................................... 116 Community Event and Convention & Visitors Bureau Funding............................................ 117 Finance Department: Summary............................................................................................................................... 118 Administration....................................................................................................................... 119 Accounting & Reporting........................................................................................................ 120 Purchasing............................................................................................................................ 121 Revenue................................................................................................................................ 122 Document Services............................................................................................................... 123 Tort Liability, Insurance......................................................................................................... 124 Employee Benefits ...................................................................................................................... 125 Emergency Levy.......................................................................................................................... 127 DEBT SERVICE: Fund Summary............................................................................................................................ 129 General Obligation Debt by Issue............................................................................................... 130 BUSINESS TYPE ACTIVITIES (ENTERPRISE FUNDS): Water Division ............................................................................................................................. 131 Wastewater Treatment................................................................................................................ 134 Airport Operations....................................................................................................................... 138 Landfill ........................................................................................................................................ 140 Refuse Collection........................................................................................................................ 142 Broadband Telecommunications................................................................................................. 144 Housing Authority........................................................................................................................ 146 Stormwater Management............................................................................................................ 148 Parking Division........................................................................................................................... 150 INTERNAL SERVICE FUNDS: Equipment: Fund Summary ..................................................................................................................... 153 General Fleet Maintenance .................................................................................................. 155 Equipment Replacement ...................................................................................................... 156 Information Technology Services: Fund Summary ..................................................................................................................... 157 Information Technology Services ......................................................................................... 158 ITS Equipment Replacement................................................................................................ 159 Police Computer Replacement............................................................................................. 159 Central Services.......................................................................................................................... 160 Risk Management Loss Reserves .............................................................................................. 161 Health Insurance Reserve........................................................................................................... 162 Dental Insurance Reserve........................................................................................................... 162 CAPITAL IMPROVEMENTS PROGRAM (CIP): FY2007 – 2011 Program Summary ...........................................................................................C-1 Project Descriptions by Category / Maps...................................................................................C-2 Recurring Projects......................................................................................................................C-17 Projects Scheduled for Completion in FY2007..........................................................................C-18 Unfunded Projects – FY2011 and Beyond.................................................................................C-20 Map – FY2008 Capital Improvement Projects ...........................................................................C-27 APPENDIX: Preparation of the Financial Plan................................................................................................ A-1 Schedule............................................................................................................................... A-2 Process to Amend ................................................................................................................ A-3 Resolutions Approving.......................................................................................................... A-4 State Forms .......................................................................................................................... A-6 All Funds Summaries.................................................................................................................. A-12 Property Taxes: Taxable Assessed Valuation History.................................................................................... A-17 Tax Levies for the Iowa City Area......................................................................................... A-19 Ten-year Tax Rate History....................................................................................................A-20 City Utilities Rates ....................................................................................................................... A-21 Glossary ...................................................................................................................................... A-22 Index by Department................................................................................................................... A-26 - 1 - - 2 - FINANCIAL PLAN OVERVIEW This Three-Year Financial Plan is for fiscal years FY2008 through FY2010, 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 FY2007 through FY2011. 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. - 3 - Citizens of Iowa City CityAttorney City Manager Mayor & City Council ElectedOfficials AppointedBy Council & Mayor Appointed by City Manager Director/Manager Employed by Board orCommission City Clerk LibraryBoard ofTrustees Boards &Commissions Airport Commission Airport Manager Library Director AssistantCity Manager FireChief Housing &InspectionServicesDirector Finance Director Parks & RecreationDirector Planning &Community DevelopmentDirector PoliceChief Public Works Director Senior Center Coordinator Parking&Transit Director Key Broadband Telecomm. Human Rights HumanResources Administration Accounting Purchasing DocumentServices InformationTechnologyServices Revenue RiskManagement Admin/Training FirePrevention FireSuppression Admin. BuildingInspection HousingAuthority HousingInspection Parking Transit Operations Para-Transit Administration CBD Maintenance Cemetery Forestry GovernmentBuildings Parks Recreation Administration Community &EconomicDevelopment JCCOG Programs NeighborhoodServices Urban Planning Administration Animal Services CommunityServices CriminalInvestigations EmergencyComm. Patrol Records &Investigations Administration EnergyConservation Engineering EquipmentMaintenance Landfill Solid Waste Collection StormwaterManagement Streets Traffic Engineering WastewaterManagement Water Senior Center - 4 - 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 F Y 2 0 0 8 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 regular 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. - 5 - - 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. - 6 - 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. 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 an optimum level of 30%. Reserves will be maintained in the Water, Wastewater and Parking Funds in accordance with existing bond ordinance provisions. - 7 - 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. - 8 - 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. Methods of source selection are as follows: Public Improvements Competitive sealed bidding shall be used for Public Improvement Contracts of $50,000 or greater (Code of Iowa). This process shall consist of: Invitation for bids Public notice Bid opening Bid acceptance and bid evaluation Bid award – City Council/Commission authorization - 9 - -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 $25,000 and the City Council approves contracts over $25,000. -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, 68B.2A 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. - 10 - 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. - 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. - 11 - - 12 - SUMMARIES & CHARTS Financial Plan Analysis Transfers Additional Position Requests Personnel Listing F Y 2 0 0 8 FINANCIAL PLAN ANALYSIS 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 TAX Property tax is the single largest revenue source for the City General Fund, accounting for over 63% of FY2008 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 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 FY99 the residential rollback exempted $.7 billion of Iowa City’s residential assessed valuation. In FY2008 the residential rollback will exempt $1.49 billion of the residential assessed valuation. The rollback for FY2008 is 45.5596% compared to FY2007 residential rollback of 45.996%. Taxable vs. 100% Assessed Valuations 0.10 0.60 1.10 1.60 2.10 2.60 3.10 3.60 4.10 4.60 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 Fiscal Year (FY) Va l u a t i o n i n B i l l i o n s $ Taxable Assessed Valuation 100% Assessed 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. - 13 - Dollars Tax Rate per $1,000 Dollars Tax Rate per $1,000 General Fund Tax Levies: General 18,151,050$ 8.100 18,549,220$ 8.100 Transit 2,128,827 0.950 2,175,526 0.950 Tort Liability 820,383 0.366 944,682 0.413 Library 605,035 0.270 618,307 0.270 Subtotal:21,705,295 9.686 22,287,735 9.733 Special Revenue Levies: Emergency 86,184 0.038 - 0.000 Employee Benefits 8,288,285 3.699 8,652,546 3.778 Subtotal:8,374,469 3.737 8,652,546 3.778 Debt Service 8,994,064 3.879 9,028,600 3.786 Total City Levy Property Taxes:39,073,828$ * 17.302 39,968,881$ 17.297 % Change from prior year:7.19% -2.41% 2.29% -0.03% Agland Levy 4,751$ 3.004 4,607$ 3.004 Total Property Taxes 39,078,579$ ---- 39,973,488$ ---- FY2007 *Certified FY2008 Budget LEVIES The City's property tax requests for FY2008 through FY2010 including the FY2007 certified tax request, are as follows: * FY 2007 adopted budget projected the FY2007 levy at $17.29662, which was used as the basis to set the FY2008 levy rate. The state certified the FY 2007 rate as $17.30225 with revised valuation. Dollars Tax Rate per $1,000 Dollars Tax Rate per $1,000 General Fund Tax Levies: General 19,095,376$ 8.100 19,657,224$ 8.100 Transit 2,239,581 0.950 2,305,477 0.950 Tort Liability 966,603 0.410 989,632 0.408 Library 636,513 0.270 655,241 0.270 Subtotal:22,938,073 9.730 23,607,574 9.728 Special Revenue Levies: Emergency 237,207 0.101 245,667 0.101 Employee Benefits 8,947,881 3.796 9,230,062 3.804 Subtotal:9,185,088 3.897 9,475,729 3.905 Debt Service 11,303,363 4.600 12,088,547 4.775 Total City Levy Property Taxes:43,426,524$ 18.227 45,171,850$ 18.408 % Change from prior year:8.65% 5.38% 4.02% 1.00% Agland Levy 4,607$ 3.004 4,607$ 3.004 Total Property Taxes 43,431,131$ ---- 45,176,457$ ---- FY2009 Projected FY2010 Projected LEVIES - 14 - Property Tax Levies Iowa City’s tax rate for FY 2008 is budgeted at $17.297 per $1,000 of taxable valuation which is the same as the FY 2007 adopted budget. City Council had several goals in setting the FY 2008 tax rate: No increase in the levy rate Reduce General Fund Unreserved balance to 30% of Expenditures The goals were accomplished by the following: Fund a portion of Debt Service from the General Fund: FY 2008 has $934,947 Funded from the General Fund; an estimated levy savings of $0.385 per $1,000 taxable valuation for the taxpayer. (FY2007 similarly has $638,200 Funding from the General Fund; an estimated current year levy savings of $0.27 per $1,000 on the FY 2007 tax bills) Emergency levy not utilized in FY 2008 While the FY2008 city levy over-all did not increase, the employee benefits levy increases by $0.06 as a result of an 8 percent increase in health insurance costs and a 5.2% increase in IPERS, offset by a slight reduction in the police and fire pension rate. Estimated Property Tax Levy on $100,000 Residential Valuation (Iowa City portion) Taxable Valuation: $45,996 Taxable Valuation: $45,559 City Levy (FY07): $ 17.302 City Levy (FY08): $ 17.297 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 FY2008 is estimated at $0.413, which is a 13% increase over FY2007. 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. FY08 $788.03 FY07 $795.83 - 15 - The Emergency levy is not being levied for FY2008. 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 Unemployment Compensation. Social Security (FICA - 7.65%) Iowa Public Employees Retirement System costs (IPERS - 6.05%, 6.35% and 6.65% FY08, FY09 and FY10 respectively) Municipal Fire and Police Retirement System of Iowa (MFPRSI – 25.48%) The employee benefits levy in FY2008 increases $0.06 which is a 2% increase. The Debt Service levy provides funding for principal and interest payments on general obligation bonds. The debt service tax receipts are estimated to be $9 million in FY2007, $9 million in FY2008, $11.3 million in FY2009 and $12 million in FY2010. Future general obligation debt issues include $8.8 million in FY 2007, $10.25 million in FY2008, $10.5 million in FY2009, and $7.45 million in FY2010. FY 2007 and FY 2008 have one-time reductions to the debt service levy, ($638,200) and ($934,947) respectively. B. GENERAL FUND REVENUE FY2008 revenues total $49.2 million which is a 3.6% increase over the FY2007 budget of $47.5 million. Revenue is projected to increase 2.1% in FY2009 ($50.2 million), and 2% in FY2010 ($51.3 million). FY06 FY07 FY08 FY09 FY10 Actual Amended Budget Estimated Estimated 1.Property Taxes 27,924,028 30,023,661 30,787,370 32,074,120 33,160,912 2.Other City Taxes 1,076,393 1,057,692 1,116,846 1,136,297 1,156,103 3.Licenses & Permits 1,285,410 1,219,543 1,255,691 1,255,691 1,255,691 4.Other Financing Sources 5,249,573 4,989,657 5,571,106 5,262,953 5,195,915 5.Use Of Money & Property 1,120,383 1,324,414 1,273,032 1,273,032 1,269,811 6.Intergovernmental 2,931,594 3,020,258 3,085,729 3,141,146 3,178,025 7.Charges For Services 3,903,294 4,086,441 4,289,819 4,289,819 4,289,819 8.Miscellaneous 1,703,224 1,763,056 1,806,721 1,798,721 1,747,371 Total Revenue:45,193,899$ 47,484,722$ 49,186,314$ 50,231,779$ 51,253,647$ % change from prior year 6.37%5.1%3.6%2.1%2.0% - 16 - FY2008 Budget General Fund Revenue $49,186,314 Charges for Services 9% Miscellaneous 4% Other City Taxes 2%Licenses & Permits 3% Other Sources 11% Property Taxes 63% Use of Money & Property 2% Intergovernmental 6% General Fund revenue is summarized into eight major categories. An analysis of each category follows: 1. Property Taxes - Property tax revenue provides 63% of General Fund revenue in FY2008. This includes transfers in from the Employee Benefits and Emergency Levy funds. Property tax support within the General Fund is proposed to increase by 2.5% in FY2008 to $30.8 million. Property taxes for FY2009 are proposed at $32.1 million, an increase of 4.2%. FY2010 property taxes are projected at $33.2 million, a 3.4% increase. Direct Receipted Levies - This includes the general, transit, library, tort liability and agriculture land levies. The property tax revenue as proposed will be at the maximum allowable levy rates per State of Iowa Code, except for the tort liability levy which has no maximum. FY2008 direct property tax revenues are projected to be $22.3 million or 2.6% greater than FY2007. FY2009 is projected to increase by 2.9% to $22.9 million and FY2010 by 2.9% to $23.6 million. Transferred Levies – The employee benefits levy property tax revenue is receipted into the Employee Benefits Fund and then transferred to the General Fund. In FY2008 the Employee Benefit Fund will transfer $8.5 million to the General Fund. The emergency levy is receipted first into the Emergency Levy Fund and then transferred to the General Fund. It will not be levied in FY 2008. 2. Other City Taxes – This includes revenue from the state-administered Hotel/Motel tax, a seven percent (7%) tax upon gross hotel/motel room rental receipts. Receipts are allocated as follows: Police Patrol (47.5%), Convention and Visitors Bureau (25%), Parks and recreational facilities (27.5%). FY2008 Hotel/Motel tax is estimated at $673,772. This category also includes a gas and electric excise tax, a state-legislated reclassification from property tax to usage tax. While cities were guaranteed a revenue-neutral period from FY2001 through FY2003, they are no longer guaranteed to match the property tax rate. The gas and electric excise tax is budgeted at $404,301 in FY2008, based on the City’s proposed property tax rate and valuations supplied by the State Department of Revenue and Finance. - 17 - 3. Licenses & Permits - This category consists of revenue received for building and rental housing permits/inspections, plumbing and electrical license fees; taxi licenses; beer, liquor and cigarette permit/license fees (state regulated), sign permits, burial permits, animal licensing and some miscellaneous fees. The FY2008 budget is $1,255,691, slightly less than FY2006 actual and FY2007 budget. 4. Other Financing Sources - Road Use Tax (RUT) revenue represents $4.2 million of the $5.6 million budgeted in this category during FY2008. This amount is transferred into the general fund to cover the net operating costs of Traffic Engineering and Streets Division, and one position budgeted within the Forestry Division for maintenance of City street right-of-ways. Other operating transfers into the General Fund include $200,000 annually from Parking, from a portion of the parking fines, and $152,821 from the Cable Division ($100,000 General Fund subsidy and $52,821 support for Library audio / visual). 5. Use of Money & Property – This revenue source consists of interest income, farmer’s market space rentals, park shelter rental fees, locker rentals, and Senior Center parking permits. It is budgeted at $1.3 million for FY2008. 6. Intergovernmental Funding – This includes state and federal grants, 28-E agreements and contracts with local governmental entities for services provided, as shown below. FY06 FY07 FY08 FY09 FY10 Intergovernmental Funding Actual Budget Budget Estimated Estimated Local Governmental: 28E Agreements* Coralville - Animal Services 99,811 50,000 50,000 70,000 70,000 IC Comm. Schools - Mercer Pool 81,878 98,312 85,964 86,766 88,000 County, Univ Heights, Hills - Library 301,498 322,136 322,136 322,136 322,136 Johnson County - Senior Center 75,000 75,000 75,000 75,000 75,000 University of Iowa - Fire Protection 1,114,740 1,148,140 1,182,700 1,218,181 1,254,726 University Heights - Transit Services 28,815 29,804 30,850 29,804 29,804 University Heights - Emergency Radio 52,844 42,275 42,275 42,275 42,275 Local Governmental Revenue:1,754,586 1,765,667 1,788,925 1,844,162 1,881,941 State-distributed Revenue: Bank Franchise Tax - - - - - Monies & Credits 13,481 13,000 13,000 13,000 13,000 Transit Assistance 364,014 360,000 398,954 398,954 398,954 Public Safety Grants 95,577 91,682 99,130 99,130 99,130 Total State Revenue:473,071 464,682 511,084 511,084 511,084 Federal Revenue: Transit Grants 499,620 784,009 785,000 785,000 785,000 Public Safety Grants 203,368 5,000 - - - Total Federal Revenue:702,988 789,009 785,000 785,000 785,000 Misc. Other Intergovernmental Revenue 948 900 720 900 - Total - Intergovernmental Funding: 2,931,593 3,020,258 3,085,729 3,141,146 3,178,025 - 18 - The City maintains a number of 28E agreements with local entities for services provided to area residents; including public transit, animal services, and access to Iowa City’s Public Library, Mercer Park Aquatic Center and Senior Center facilities and programs. The University of Iowa contracts separately with the City for fire protection, with an estimated $1.2 million budgeted for receipt within the General Fund for Fire Operations and Fire Vehicle Replacement. The Employee Benefits fund also receives a portion of the Fire contract for Fire employee benefits. State grants are estimated at $512,130 for FY2008, of which $398,954 is for state transit assistance. 7. Charges for Services – The FY2008 budget of $4.3 million reflects a five percent (5%) increase above the FY2007 budget. Revenues include fees for Transit, Parks and Recreation, Police, Fire, Housing & Inspection Services, Animal Control services and Cemetery services. It also includes intra-city charges paid by the business type funds such as Water, Wastewater, Landfill, Refuse and Cable to the General Fund as reimbursement for a portion of the administrative functions. Parks and Recreation fees are reviewed annually by the Parks and Recreation Commission and most fees are adjusted by type every two years. 8. Miscellaneous – This category includes a variety of different revenue sources. The largest are parking fines other than expired meters ($550,000), code enforcement which includes magistrate court fines and surcharges ($440,239), library fines ($203,926) and a transfer from the Health Reserve to the General Fund ($200,000). - 19 - - 20 - - 21 - C. GENERAL FUND – EXPENDITURES The General Fund expenditure budget in FY2008 is $50,522,086 compared to the amended FY2007 budget of $49,127,442 and represents a 2.8% increase in expenditure levels. Note that Transfers out includes $934,947 of General Fund monies being used to pay a portion of the debt service in FY08, as directed by City Council to maintain rather than increase the property tax rate and to reduce the ending General Fund balance to no more than 30% of expenditures. A comparison of dollars by major expenditure classification is provided below: FY06 FY07 FY08 FY09 FY10 Actual Amended Budget Estimated Estimated Personnel 30,503,770 32,801,850 33,730,753 34,890,263 36,028,511 Services 8,454,301 9,631,718 9,874,567 9,752,453 9,973,463 Supplies 2,010,938 2,256,571 2,420,804 2,520,383 2,625,685 Capital Outlay 1,524,344 2,206,212 1,828,280 1,419,126 1,174,646 Other Financial Uses - Transfers 928,364 2,231,091 2,667,682 1,390,841 1,551,666 TOTAL EXPENDITURES 43,421,717 49,127,442 50,522,086 49,973,066 51,353,971 % Change 5.7% 13.1% 2.8% -1.1% 2.8% - 10 20 30 40 50 60 Mi l l i o n s o f D o l l a r s ( $ ) F Y 0 6 F Y 0 7 F Y 0 8 F Y 0 9 F Y 1 0 Fiscal Year (FY) FY2008 Budget General Fund Expenditures by Category Transfers Capital Outlay Supplies Services Personnel - 22 - 1. Personnel – Personnel costs account for approximately 68% of budgeted expenditures within the General Fund and are up 2.8% in FY2008. This includes salaries and benefits, including health, life, disability insurance, employer share of FICA and IPERS, and Police/Fire retirement contributions. 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 the Iowa City Association of Professional Fire Fighters, IAFF, AFL-CIO (Local #610). Supervisory, confidential, temporary and other employees specified in Chapter 20 of the Code of Iowa are excluded from these unions and the terms, conditions or application of the respective agreements. The majority of City employees are represented by AFSCME, which is comprised of two bargaining units: one exclusively for Library employees and one for all other departments. AFSCME ratified a three-year contract that spans July 1, 2007 through June 30, 2010. This agreement includes adjustments to wages of 3.25%, 3.3% and 3.1% for each year respectively plus any step increases. Sworn police officers are represented by the Police Labor Relations Organizations (PLRO) of Iowa City. The bargaining unit is composed of all Iowa City police officers. Exempt from the unit are the police chief, captains, lieutenants and sergeants. A new three year contract was ratified with the PLRO, beginning July 1, 2006 through June 30, 2009. The agreement provides for wage increases of 3.1% in the first year, 3.25% in the second year, and 3.3% in the third year plus any step increases. The firefighters are represented by the Iowa City Association of Professional Fire Fighters (IAFF), AFL- CIO (Local #610). The bargaining unit is composed of firefighters, lieutenants, and captains. Exempt from the unit are the fire chief, deputy fire chief, fire marshal and battalion chiefs. The IAFF and City ratified a three-year contract that spans July 1, 2006 through June 30, 2009. The agreement provides for wage increases of 3.1% in the first year, 3.25% in the second year, and 3.3% in the third year plus any step increases. Administrative, confidential, supervisory and temporary employees who are ineligible for collective bargaining are covered by the Personnel Rules and Regulations. Some employees are eligible for Civil Service. Salaries and benefit appropriations are determined by the City Council upon the recommendation of the City Manager. Adjustments to the administrative / confidential pay plan are the same as AFSCME for FY2008 - 2010, per City Council resolution. Health insurance is projected to increase 8%. The employer portion of the IPERS retirement rate will be increasing from 5.75% to 6.05% in FY2008, 6.35% in FY2009 and 6.65% in FY2010. The MFPRSI (Municipal Fire & Police Retirement) rate decreases in FY2008 to 25.48% from 27.75% in FY 2007. 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 2008 expenditures are budgeted at $9.9 million and are 2.5% higher than FY2007. 3. Supplies - Supplies consist primarily of materials that are consumed or depleted, such as office and cleaning supplies, fuels and materials for repair and maintenance of buildings, streets, and equipment. The FY2008 budget is $2.4 million, up 7.3% from the prior fiscal year. 4. Capital Outlay – General Fund capital outlay is budgeted at $1.8 million in FY2008 and includes police vehicle replacements, library materials, operating equipment, and building maintenance and improvements. More traffic signal equipment is within the FY07 budget due to the tornado. - 23 - Other Financial Uses – This category budgeted at $2.7 million for FY 2008 includes transfers out of the General Fund totaling $2.3 million, and $369,230 budgeted for contingency at 0.75% of expenditures per City Council policy. Following is an itemized listing of budgeted transfers out of the General Fund and contingency from FY 2007 - FY2010. General Fund Transfer To BL FY 2007 Budget FY2008 Budget FY2009 Estimated FY2010 Estimated Airport Operations 109,000 112,000 112,000 112,000 JCCOG 153,421 159,500 164,700 169,500 CIP-City Hall 30,000 - - - Landfill - Fire Loan Repay 14,188 14,909 15,677 16,513 Landfill - Mercer/Scanlon Loan Repay 43,522 45,637 - - Parkland Acquisition-Scanlon Loan Repay 23,840 25,054 26,335 - Library Computer Repl. Reserve 42,968 42,968 42,968 42,968 Library Equipment Replacement Reserve 19,454 19,454 19,454 19,454 2002 G.O. Bond - Debt Abatement (Library Commercial Space)50,000 50,000 50,000 50,000 Landfill - Senior Center Loan Repay 48,290 49,903 52,209 46,140 Transit Improvement Reserve 203,385 495,030 432,935 369,757 Transit - Daycare Facility Loan 48,602 49,050 50,063 51,074 CIP-Parks Land Acquisition 50,000 50,000 50,000 39,400 Debt Service - Levy Reduction 638,200 934,947 - Total Transfer from General Fund 1,474,870 2,298,452 1,016,341 1,166,806 Contingency 353,160 369,230 374,500 384,860 Total Other Financial Uses 1,828,030 2,667,682 1,390,841 1,551,666 - 24 - D. GENERAL FUND YEAR-END CASH BALANCE The City Council General Fund balance policy was revised in FY2007 to establish an optimum fund balance of 30% of expenditures. The policy ensures that operating cash balances will be maintained at a level to ensure sufficient cash flow throughout the fiscal year. The following table depicts the General Fund Operating cash position for fiscal years 2006 through 2010. FY06 FY07 FY08 FY09 FY10 Actual Budget Budget Estimated Estimated Beginning Balance 17,989,182 19,761,364 18,118,644 16,782,872 17,041,585 Receipts 45,193,899 47,484,722 49,186,314 50,231,779 51,253,647 Expenditures (43,421,717) (49,127,442) (50,522,086) (49,973,066) (51,353,971) Ending Balance 19,761,364 18,118,644 16,782,872 17,041,585 16,941,261 *Reserved / Restricted 2,027,516 1,780,986 2,355,713 2,870,796 3,304,950 Unreserved 17,733,848 16,337,658 14,427,159 14,170,789 13,636,311 Unreserved Balance as % of Expenditures 41%33%29%28%27% ` *Reserved / Restricted includes: Library Computer and Equipment reserves, Park Land Acquisition & Development, Transit Equipment reserve, Fire Equipment Replacement reserve and restricted Escrow / Deposits. The cash fund balance is used to provide cash flow during the first quarter of the fiscal year because the majority of property taxes are received in October/November, causing the cash balance to be drawn down. The following chart shows cash flow needs or how expenditures have exceeded receipts in the first three months for the past five years. 3 Months @ Sept. 30 Receipts Expenditures Shortfall in Receipts FY07 $ 7,881,225 $ 13,014,632 (5,133,407) FY06 6,315,525 12,105,987 (5,790,462) FY05 6,040,943 10,889,278 (4,848,334) FY04 4,595,488 11,049,590 (6,454,102) FY03 4,806,797 9,410,440 (4,603,643) FY02 4,387,107 8,818,510 (4,431,403) FY01 4,449,250 9,233,286 (4,784,036) - 25 - 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 proprietary funds (Parking, Wastewater, and Water) and 64-1A TIF district tax revenue. Debt Service issuance in FY2007 includes a $3.35 million refunding of GO Bonds from 1997 and $8.8 million in general purpose bonds. FY2008 through 2010 issues are estimated at $10.25 million, $10.5 million and $7.45 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. Property valuations for FY2008 – 2010 have been estimated with the assumption of three percent (3%) growth, annually. Fiscal Year Total Property Valuation Allowable Debt Margin (5% of Total Property Val.) Outstanding Debt at July 1 Debt as % of Allowable Debt Margin FY00 2,416,782,699 120,839,135 46,165,000 38% FY01 2,591,030,038 129,551,502 41,190,000 32% FY02 2,692,448,464 134,622,423 61,565,000 46% FY03 2,909,644,383 145,482,219 85,260,000 59% FY04 2,962,505,107 148,125,255 79,100,000 53% FY05 3,195,170,779 159,758,539 85,085,000 53% FY06 3,214,973,037 160,748,652 85,290,000 53% FY07 3,732,590,506 186,629,525 85,060,000 46% *FY08 3,931,783,525 196,589,176 85,370,000 43% *FY09 4,049,737,031 202,486,852 87,625,000 43% *FY10 4,171,229,142 208,561,457 88,925,000 43% * Estimate - 26 - G.O. Debt Outstanding - by Fiscal Year - 0 50 100 150 200 250 FY 01 FY 0 2 FY03 FY04 FY05 FY06 FY07 *F Y 08 *F Y 09 *F Y 10 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 Iowa City’s Fiscal Policy also includes the guideline 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 FY99 through FY10. The levies for FY01-FY07 are certified; the levies for FY08, FY09, and FY10 are projected. FY07 and FY08 had one-time reductions in the debt levy as part of General Fund balance reductions. Debt Service Levy As a Percentage of Total Property Tax Levy (25% Recommended Maximum) 26%26% 25% 22%22%23%23% 20% 25% 20% 0% 5% 10% 15% 20% 25% 30%20 0 1 2002 20 0 3 200 4 20 0 5 2 00 6 20 0 7 *2008 *2009 *20 10 Fiscal Year (FY)* Estimated - 27 - F. INTERNAL SERVICE FUNDS Internal Service funds include the Equipment Maintenance Fund, Equipment Replacement Fund, the Central Services Fund, the Risk Management Loss Reserve Fund, the Health Insurance Reserve Fund and Information Technology Services Fund. The Equipment Maintenance Fund provides maintenance for all City vehicles and equipment and rents vehicles to other City departments from a central vehicle pool. Funding is provided from a chargeback to all departments for the maintenance services and the rentals of vehicles. The Equipment Replacement Fund is used to replace most rolling stock. Funding is provided from an annual chargeback to all departments based on the estimated replacement value at the time of replacement. The Information Technology Services Fund accounts for the technical support, networking, web development, data storage and hardware replacement for most of the City’s computer and phone systems. Individual cost centers/divisions are charged for this support. Exceptions to this include the Library, Broadband Telecommunications and H.U.D.-financed programs (C.D.B.G. and the Housing Authority). The Central Services Fund provides centralized contract administration, duplicating, radio, and postal services. The Risk Management Loss Reserve Fund accounts for workers compensation, property, and liability losses for all funds. Funds are charged based on their loss experience and pro rata share of the insurance premium. Market conditions within the insurance industry have resulted in a significant increase in the City’s self-insured retention amount to $400,000 per occurrence for worker’s compensation and $500,000 per occurrence for liability claims. Property insurance self-insured retention is $100,000 per occurrence. The Health Insurance Reserve accounts for the actual payment of all health and dental claims. Premiums are based on actuarially sound estimates and charged to each department. The premiums vary by labor bargaining unit contracts. Health and dental insurance premiums are projected to increase 8% in FY2008 and 5% in FY2009 and FY2010. G. SPECIAL REVENUE FUNDS The Special Revenue Funds include the Employee Benefits Fund, Community Development Block Grant Fund (CDBG), Road Use Tax Fund, Johnson County Council of Governments (JCCOG), Special Assessments, Economic Development Fund, and Tax Increment Financing funds. The Community Development Block Grant (CDBG) Fund accounts for revenue from the U.S. Department of Housing and Urban Development programs and is restricted in use for eligible projects as defined by federal regulations. These monies are utilized by both businesses and individual homeowners for property rehabilitation and community development initiatives. FY2008 CDBG federal revenue is budgeted at $810,000 and the HOME program at $637,000. The Road Use Tax Fund accounts for state-distributed revenues based on gasoline taxes, license fees and weight taxes. These funds are distributed back to cities based on a per capita formula and are used to pay for street and traffic engineering maintenance, planning and construction-related costs. Based on an Iowa City population of 63,283; per capita estimates for FY2008 – 2010 are $84.40, $85.40, and $85.50 respectively, resulting in annual Road Use Tax revenue estimates of $5,341,085, $5,404,368 and $5,410,697 for fiscal years 2008 – 2010. - 28 - Johnson County Council of Governments (JCCOG) provides county-wide planning assistance for transportation, human services and solid waste planning. The City of Iowa City acts as custodian for the fund and provides accounting and payroll services. To encourage development in various locations in Iowa City, the City has established (TIF) Tax Increment Financing Districts. TIF revenues are used to repay debt incurred for the projects and to pay property tax rebates on increased valuation per development agreements within the districts. H. RESERVE FUNDS Several reserve funds have been segregated out of General Fund due to their restricted nature. This includes the Library Computer and Equipment Replacement Reserves, Parkland Acquisition and Development Reserves, Fire Vehicle Replacement and Transit Equipment Reserve Funds. A number of reserve funds also appear in the Business-Type Activities section of this Financial Plan. Revenue bond covenants require that Parking, Water and the Wastewater Treatment Funds set aside a number of special reserve accounts. Landfill and Broadband Telecommunications also have separate reserves for future capital expenditures. Landfill's reserve is to be used for the purchase of additional land, cell construction, and cell post-closure costs. Broadband Telecommunications' reserve is for future equipment replacement. I. BUSINESS-TYPE ACTIVITES The Business-type Funds include Parking, Wastewater Treatment, Water, Refuse, Landfill, Airport, Broadband Telecommunications, Housing Authority, and Stormwater Management. These 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 HUD federally funded program. 1. PARKING FUND A number of parking fee increases went into effect July 1, 2006, as can be seen in revenue projections for FY2007 forward. 2. WASTEWATER TREATMENT FUND Fee Increase: 5% Recommended in FY09 A sewer rate increase of eight percent (8%) went into effect July 1, 2006 due to a decrease in industrial users and associated fees. An additional five percent (5%) increase is recommended for FY09 due to decreasing bond covenant ratios. Public Works has initiated a cost of service rate study for both the Water and Wastewater Funds. 3. WATER FUND A five percent (5%) reduction in water user fees went into effect on July 1, 2006. No further change in user fees is recommended at this time as fund balance remains healthy. - 29 - 4. REFUSE FUND Fee Increase: $1.00 in FY2008 Refuse fees will increase from $13.00 per month to $14.00 in FY2008, resulting in $10.40/month for refuse collection and $3.60/month for recycling collection. Future years include an additional $0.50 increase annually for FY2009 and FY2010. Personnel and vehicle operations (including fuel) account for the majority of costs in this fund. Capital outlay budgeted at $55,000 annually includes purchase of 1,200 roll-out trash containers per year. 5. LANDFILL FUND The landfill fee remains at $38.50 per ton for city residents and $43.50 per ton for county residents. $2.10 of the tonnage fee is a state surcharge that is remitted to the state and $1.55 per ton is a local surcharge, also required by the state. The local surcharge is used to fund Iowa City’s support of JCCOG Solid Waste as well as education efforts and ECICOG regional solid waste planning. 6. AIRPORT FUND The FY08 budget maintains current operations and includes continued repayment of interfund loans used to construct hangars at the airport. A number of capital improvement projects are budgeted in FY07 and FY08 as proposed to FAA. 7. BROADBAND TELECOMMUNICATIONS FUND 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 $619,208 in FY2008. 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 $127,687 for FY2008. 8. STORMWATER MANAGEMENT FUND 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 $593,179 in FY2008. Construction for the following year includes annual creek side drainage and sump pump discharge tiles. Reconstruction of the storm sewer at the Gilbert, Prentiss and Bowery Street intersection is scheduled for FY2008. 9. HOUSING AUTHORITY FUND The Housing Authority Fund accounts for $7.1 million in revenue from the U.S. Department of Housing and Urban Development (H.U.D.) for programs to assist individuals and families in obtaining affordable housing. - 30 - Property Taxes, Including TIF 41,771,694$ Other City Taxes 1,446,363 Intergovernmental 21,657,383 Charges & Fees for Service 37,721,095 Licenses & Permits 1,260,091 Use of Money and Property 3,938,963 Miscellaneous 4,566,683 Proceeds of Debt & Capital Asset Sales 10,972,930 Revenue - All Funds 123,335,202 Interfund Transfers 43,686,586 Total - Revenue & Interfund Transfers 167,021,788 FY2008 BUDGET - ALL FUNDS Where the Money Comes From: $123,335,202 Other City Taxes 1% Misc. 4% Intergovt. 18% Charges for Fees & Service 31% Licenses & Permits 1% Property Taxes, Including TIF 33% Proceeds of Debt & Capital Asset Sales 9% Use of Money and Property 3% - 31 - Public Safety 17,504,724$ Public Works 11,135,061 Capital Projects 14,251,738 Culture & Recreation 10,646,775 Community and Economic Development 6,041,351 General Government 7,891,847 Debt Service 11,717,610 Business Type / Proprietary Funds 45,878,428 Expenditures - All Funds 125,067,534 Interfund Transfers 43,686,586 Total - Expenditures and Interfund Transfers 168,754,120 FY2008 BUDGET - ALL FUNDS Where the Money Goes: $125,067,534 Community and Economic Development 5% General Government 6% Debt Service 9% Business Type / Proprietary Funds 37% Public Safety 14% Capital Projects 11% Public Works 9% Culture & Recreation 9% - 32 - - 33 - - 34 - - 35 - - 36 - - 37 - - 38 - - 39 - CITY OF IOWA CITY, lOWA Full Time Equivalent's (FTE) ComparisonFY 2007 to 2008 Division City Council City Clerk City Attorney City ManagerPersonnel Finance Administration Accounting Purchasing Revenue Division (old Treasury chDocument Services Operations &Maintenance Energy Conservation Human Rights Mass Transit Administration &SupMass Transit OperationsTransit Fleet Maintenance Transit Auto Body Court St Transportation Center Police Department Administration Criminal InvestigationPatrol Records &Identification Emergency Communications Jo County Task Force GrantDomestic Violence Grant Fire Adminstration Fire Emergency OperationsFire Prevention Fire Training Shelter Operations &Administrati Animal Control Patrolling HIS Department Administration Building Inspection Housing InspectionsPublic Works Administration and S Engineering Services Traffic Eng Admin &Support Traffic Eng Signals Streets Admin &Support Streets Repair ProgramsParks&Rec Admin General Office Administration Rec Building Maintenance-Recreation C Supervision-Social/CulturalMercer Park Pool Operations Supervision-Aquatics Supervision - SPI Supervision-Fitness/Wellness Scanlon Gym Parks Maintenance Admin &Support Parks Operations &Maintenance Forestry Operations Cemetery Operations CBD Maintenance Operations Library Administration Library Building Maintenance Computer Systems Library Commercial BuildingTechnical Services Public Services Reciprocal Borrowing Senior Center Operations PCD Department Admin Urban Planning Neighborhood Services Non-Grant Community Development Economic Development TOTAL GENERAL FUND Full Time 7.00 4.00 6.00 3.00 4.00 2.80 7.00 3.25 7.50 3.50 4.33 .00 1. 00 3.50 24.50 6.00 1. 00 2.00 5.00 8.00 64.00 6.00 10.001. 00 1. 00 4.00 50.00 2.001. 00 5.75 .25 2.75 7.00 4.00 2.00 11.10 1.15 3.001. 50 22.00 2.00 4.00 3.671. 001. 65 .55 1. 001. 00 .80 2.00 11.00 3.00 3.00 3.00 3.00 3.75 3.00 .25 6.00 16.00 .00 5.81 2.05 3.001. 00 .80 1. 00 386.21 2007 Part Time .00 .00 .60 .00 .00 .32 .00 .75 1. 38 .00 .63.251. 50 .00 17.75 .00 .00 .00 .00 .00 .00 .001. 25 .00 .00 .00 .00 .00 .00 .00 .00 .00 .50 1.13 .00 .25 .00 .00 .00 .00 .00 .00 .00 .00 .451. 00 .00 .00 .30 .00 .00 .00 .00 .00 .50 .50 .75 .00 2.08 6.56 .75 .50 .50 .50 .00 .10 .00 40.80 Total 7.00 4.00 6.60 3.00 4.00 3.12 7.00 4.00 8.88 3.50 4.96.25 2.50 3.50 42.25 6.00 1. 00 2.00 5.00 8.00 64.00 6.00 11.25 1. 00 1. 00 4.00 50.00 2.001. 00 5.75 .25 2.75 7.50 5.13 2.00 11.35 1.15 3.001. 50 22.00 2.00 4.00 3.671. 00 2.101. 551. 001. 00 1.10 2.00 11.00 3.00 3.00 3.00 3.50 4.25 3.75 .25 8.08 22.56 .75 6.31 2.55 3.501. 00 .90 1. 00 427.01 Full Time 7.00 4.00 6.00 3.00 4.00 2.80 7.00 3.25 7.50 3.50 4.33 .00 1. 00 3.50 24.50 6.00 1. 00 2.00 5.00 8.00 64.00 6.00 10.00 1. 00 1. 00 4.00 50.00 2.001. 00 5.75 .25 2.75 7.00 4.00 2.00 11.10 1.15 3.001. 50 22.00 2.00 4.00 3.671. 001. 65 .55 1. 001. 00 .80 2.00 11.00 3.00 3.00 3.00 3.00 3.75 3.00 .25 6.00 16.00 .00 5.81 2.05 3.00 1. 00 .80 1. 00 386.21 2008 Part Time .00 .00 .60 .00 .00 .32 .00 .751. 38 .00 .63 .251. 50 .00 17.75 .00 .00 .00 .00 .00 .00 .001. 25 .00 .00 .00 .00 .00 .00 .00 .00 .00 .50 1.13 .00 .25 .00 .00 .00 .00 .00 .00 .00 .00 .451. 00 .00 .00 .30 .00 .00 .00 .00 .00 .50 .50 .75 .00 2.08 6.56 .75 .50 .50 .50 .00 .10 .00 40.80 Total 7.00 4.00 6.60 3.00 4.00 3.12 7.00 4.00 8.88 3.50 4.96 .25 2.50 3.50 42.25 6.00 1. 00 2.00 5.00 8.00 64.00 6.00 11.25 1. 00 1. 00 4.00 50.00 2.00 1. 00 5.75 .25 2.75 7.50 5.13 2.00 11.35 1.15 3.001. 50 22.00 2.00 4.00 3.671. 00 2.101. 551. 001. 001.10 2.00 11.00 3.00 3.00 3.00 3.50 4.25 3.75 .25 8.08 22.56 .75 6.31 2.55 3.50 1. 00 .90 1. 00 427.01 - 40 - CITY OF IOWA CITY, lOWA Full Time Equivalent's (FTE) Comparison FY 2007 to 2008 Division Parking Admin &Support On Street &Lot Operations Capitol Street Garage Operations Dubuque Street Garage Operations Chauncey Swan Garage Operations Tower Place Garage OperationsWastewater Treatment Administrati North Plant Operations Sewer Systems South Plant Operations Water System Administration &Sup Water Plant Operations Water Distribution SystemWater Customer Service Water Public Relations Refuse Collection Administration Refuse Collection OperationsYard Waste Collection Recycling Curbside Collection White Goods/Bulky Collection Landfill Administration &Support Landfill Operations Solid Waste Recycling Operation Solid Waste Surcharge Reserve Landfill Capital Acquisition/CIP Airport Operations Cable TV Administration &Support Local Access Pass Through Storm Water Management Housing Authority Voucher - Admin Public Housing Program TOTAL ENTERPRISE FUNDS Non-Reimbursable Personnel Roads CDBG Administration Rehab-Project Delivery HOME ProgramJCCOG Administration JCCOG-General Transportation PlanJCCOG Human Services Solid Waste Management File Servers &System Support Desktop Support Network &Internet SupportWeb Administration &Services Phone Administration General Fleet Maintenance Equipment ReplacementMail Service Risk Management Administration Library Development Office Salary TOTAL OTHER FUNDS GRAND TOTAL (FTE'S) Full Time 4.50 9.00 3.00 2.00 1. 00 .50 2.00 16.00 4.50 3.00 2.00 11.00 8.00 10.00 .501. 35 8.00 4.00 5.00 1. 00 2.00 5.00 5.25 .75 1. 00 1. 00 3.19 1. 00 2.00 10.451. 80 129.79 .10 1. 001. 25 1. 20 1. 00 1.10 4.00 1. 00 .50 6.15 3.10 .20 .85 .20 9.50 .50 .751. 60 1. 00 35.00 551.00 2007 Part Time .001. 00 6.25 2.50 .00 3.00 .00 .00 .00 .00 .00 .00 .00 .50 .00 1. 00 .00 .00 .00 .00 .00 .50 .00 .00 .00 .601. 25 .75 .00 .95 .05 18.35 .19 .00.13 .40 .00 .00 .00 .00 .00 .75 .00 .00 .75 .00 .38 .88 .00.13 .00 3.61 62.76 Total 4.50 10.00 9.25 4.50 1. 00 3.50 2.00 16.00 4.50 3.00 2.00 11.00 8.00 10.50 .50 2.35 8.00 4.00 5.00 1. 00 2.00 5.50 5.25 .75 1. 001. 60 4.441. 75 2.00 11.401. 85 148.14 .29 1. 001. 38 1. 60 1. 00 1.10 4.00 1. 00 .50 6.90 3.10 .20 1. 60 .20 9.881. 38 .75 1. 73 1. 00 38.61 613.76 Full Time 4.50 9.00 3.00 2.00 1. 00 .50 2.00 16.00 4.50 3.00 2.00 11.00 8.00 10.00 .501. 35 8.00 4.00 5.00 1. 00 2.00 5.00 5.25 .75 1. 00 1. 00 3.19 1. 00 2.00 10.45 1. 80 129.79 .10 1. 001. 25 1. 20 1. 00 1.10 4.00 1. 00 .50 6.15 3.10 .20 .85 .20 9.50 .50 .75 1. 60 1. 00 35.00 551. 00 2008 Part Time .001. 00 6.25 2.50 .00 3.00 .00 .00 .00 .00 .00 .50 .00 .75 .00 1. 00 .00 .00 .00 .00 .00 .50 .00 .00 .00 .601. 25 .75 .00 .95 .05 19.10 .19 .00.13 .40 .00 .50 .00 .00 -.50 .80 .00 .00 1. 00 .00 .38 .88 .00.13 .00 3.91 63.81 Total 4.50 10.00 9.25 4.50 1. 00 3.50 2.00 16.00 4.50 3.00 2.00 11.50 8.00 10.75 .50 2.35 8.00 4.00 5.00 1. 00 2.00 5.50 5.25 .75 1. 00 1. 60 4.441. 75 2.00 11.401. 85 148.89 .29 1. 001. 38 1. 60 1. 00 1. 60 4.00 1. 00 .00 6.95 3.10 .201. 85 .20 9.88 1. 38.75 1. 73 1. 00 38.91 614.81 - 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