HomeMy WebLinkAbout2023-01-24 Transcription Page 1
Council Present: Alter,Bergus,Dunn,Harmsen, Taylor, Teague, Thomas
Staff Present: From,Jones,Kilburg, Goers, Fruehling,Platz, Davies, Ogden,Havel,
Sovers,Hightshoe
Continuation of Budget discussion
Teague: All right,today is January 24, 2023, and this is the City of Iowa City work session. And
the fust item is continuation of our budget discussion.
From: Mayor, if I could just give a- a brief intro,um, I did want to, ah, elaborate on one thing
that was mentioned at your city Conference Board and that Brad Comer,the City
Assessor, as alluded to. On Friday,there was legislation introduced to,um, amend the
residential rollback figure. Um,the legislative service agency identified what they felt
was an error in the calculation of the rollback that was previously given to cities. Ah, so
there has been legislation introduced to correct that error, and that would take effect and
impact the current budget that we're working on,your FY24 budget. Um,that,um,would
reduce the rollback of approximately two percent,um, and for Iowa City would be about
a $1.7 million impact primarily to the general fund,but a few other property tax-
supported funds would be impacted as well. Um, at this point, all the advice that we're
getting, ah, from the state is to proceed ahead with-with our hearing schedule. But we
have to understand that this legislation has been introduced, it may be entertained and
passed and if so,we will have that $1.7 million deficit essentially out of the gate with this
budget. So,um, I say that just for your awareness, I'll keep you posted on where that
legislation and any other property tax legislation goes this session. But I wanted to add
some more background to-to the assessor's earlier comment.
Bergus: Just to,um, offer that, Geoff, do you- do we have a sense of what,um, or would we even
have in any of our levees that would be applicable to the loss if it's general fund dollars,
like what would it take to make that up?Do we have any opportunities?
From: Yeah. Really I haven't had the time to go back in and- and provide some- some thoughts
on where we would take-take those funds. The general fund is about 1.2 million, is it
would be the overall impact. Thankfully,we have enough reserves where we could
absorb that in a given year if we were willing to utilize our reserves for that purpose. But,
um,we are beginning that process now of analyzing exactly how we could overcome that
challenge should that legislation pass.
Bergus: Do you think there's any likelihood that staff would recommend,um, levy changes
outside of what's been proposed?
From: Well,we don't-we don't even know if that's going to be possible because if they don't
amend the approval-the budget approval dates,we have to set our max property tax levy,
you know,within a couple of weeks. So unless we just wanted to-to put it up now or that
bill is being concerned,being-being discussed,um,we wouldn't really have that
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opportunity. Um, as we march ahead,will lock in the-the property tax rate that we've
discussed or that you may maybe amend and tonight,um, and we have to live with that.
Again,the-the bill could be fluid too,there could be amendments offered to the bill,
there could be deadlines that are changed,there could be all kinds of changes,but at this
point,no. Um,we- and then there's only a few levies that we could actually increase,you
can increase the 810 levy,your general fund levy because that's maxed out. But we could
potentially look at increasing debt service levies or employee benefits levies and trying to
make up some or all of that gap.
Bergus: That's kinda what I was getting at. Okay. Thank you.
Harmsen: And again, once we set our- for our public hearing purposes,we can always- in our
final decision,we can reduce that levy rate, ah,but we can't go above whatever we set as
our.
Fruin: That's correct.
Teague: If we're thinking any change then today would probably be a good time to talk about it.
Fruin: Yeah. At this point, I'm not prepared to recommend that we make any changes, I really
just wanted to make you aware again,the legislation was just introduced late last week.
And, ah, as you can imagine, cities across the state are,um, sounding the alarm bells to
their-to their delegation. So, we're hopeful that, ah,nothing will happen and the rate that
they advertise last fall to cities so that we could begin the budget process will be honored
and then they can make any corrections they need to with next year's rollback rate. But
we'll-we'll begin on- on kind of behind the scenes to analyze scenarios, ah, if we do have
to make up that 1.7 million.
Alter: But it does sound like even just in the course of describing, sorry, in the course of
describing it to us that there are some options that you guys can look at.
Fruin: Yeah. I think that's, you know, a really a credit to-to past counsels and the way budgets
have been structured,um,we do have the reserves to,um,take a short term hit like that,
if you will, without impacting service levels. That may not be exactly how we want to
handle this,but if push comes to shove,we could-we could absorb that. That's part of the
reason the emergency reserve was fust created. We created that in 2014 after the 2013
property tax reform,knowing at that point we had the opportunity to build our reserves
and we weren't quite sure what that impact from the 2013 property tax reform would-
would provide. So we created that emergency reserve for a scenario just like this, it's just
unfortunate that it's here before us today.
Dunn: Can- can you remind us how much we have in that fund?
Fruin: Ah, approximately 5 million,maybe a little bit more five point,two, three. Yeah.
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Bergus: Well, I'll just jump in then on some general comments and can make continuing our
conversation from not so much the CIP,but it sort of our, ah, operational conversation of
Saturday,the 7th. So one thing that I highlighted on that day was that the timing of the
preparation of this budget had to come before we finalize this strategic plan. And so in
front of us on all the screens,we have,you know, our strategic values and impact areas
that we've gotten behind. And I would ask that we consider not sort of losing the
opportunity to act more aggressively in implementing aspects of our strategic plan and
trying to maximize alignment of our actions with this plan that we put a lot of energy
and- and goodwill into for our community. Uh, so specifically,uh,you know,just to kind
of, again,make a- a pitch to all of you, I think we really need to ramp up our community
outreach. Um,right now,we have a neighbor-neighborhood outreach position that is a
half-time position. Um,when Marcia Bollinger retired, that position was split into two
half-time positions, and I think with the,uh, emphasis on strengthening neighborhoods
and helping community safety and well-being,we really want to empower neighborhoods
to organize, empower leadership, create leaders out in the community to learn how to
work together,um, and strengthen those neighborhoods. We've seen the benefit of that
kind of outreach and,um, sort of infusion of skills and resources. That really doesn't take
a whole lot of money,but takes,you know,the-the staff capacity to do that. We've seen
the value of that,particularly I think most recently in the south district, and I think we
need to be really ramping that up. So I think,um,you know,what Ayman Sharif is doing
now is tremendously impactful. I had an opportunity last weekend to attend a-the home-
ownership,uh,program sort of informational session that was held at one of the Taylor
drive Duplexes that we recently renovated. And it was just unbelievable hearing people
who had benefited from this program,people who were considering becoming
homeowners. They-how how they were saying,you know, I used to not like this part of
town,but hearing your investment in it,hearing how you feel raising your son here,
hearing how,you know,you can see with home-ownership how,um,the neighborhood is
coming together and you can rely on each other, it's so powerful. It's so powerful and
when you think about,um,that kind of impact in places where, again,tying it back to
safety and community safety, in a neighborhood where we know,you know,policing
presence is high and calls for service may be disproportionate,um, I really just think we
need to shift towards that kind of proactive,um, community building. And our staff can
model this kind of resilience and support right within the neighborhoods but I think we
need to put more to it. So I think it could also tie into,um, a position that I know staff had
been looking at on the sort of centralized grants side. Um,you know I think having
coordination between finding resources and,um,being able to funnel money through the
city supporting a variety of departments and then on the compliance side as well. Um,
because part of the role of our community outreach folks should be connecting those
additional resources and finding programmatic outlets with our non-profit partners,you
know,things that we can help support in the community when additional funding sources
arise. I- I see that kind of all coming together. And,you know,to put-put a finer point on
where do we find the money. I'm really concerned to find sort of to hear,you know,
about this legislation. It's not surprising. We know that,um, in addition to the rollback
issue, additional property tax reform is on the table and could impact us sooner than we
want. So my proposal that I said on the 7th, I'll just reiterate,which is in our police
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department,we have patrol at 78 officers currently hired. If we stayed at that level at that
current staffing level,that would free up the funds from the unhired,unfilled positions,
which is six positions now. And those could be shifted towards this kind of community
outreach, empowerment, finding resources, and helping distribute those resources in the
community.
Taylor: I can't say it as well as you've said it Councilor Bergus and I was thinking when you
were talking about the South District neighborhood and their association and how it's
grown. And they have regular meetings and they've got some very strong people. And the
South district is really moving along. It's- It's really helpful,but I'm- I'm remembering
when Councilor Thomas and I attended,um,the listening post on the West side at- at the,
what it was. Yeah,Pheasant Ridge and primarily Sudanese population. And what came
from these people in their conversations is I-they-they need something like that. They
need a stronger and I think,um, as mercenary force is going to help them with that to
kind of get a neighborhood association going. But if we've got some resources in the city
and some funding for even one position,maybe not all six of those,but maybe at least
one of those could be,uh, or even four of the six. So that's one in each dis- each district,
each district of Iowa City. To help those districts thrive and grow and be a place that
these residents could feel a part of their community and- and know their neighbors. So I
think that's important.
Dunn: Yeah, I- I tend to agree on many levels. Uh,you know,Laura and I,we've-we've talked
about this,uh,before,this meeting. Um,but I- I think having more organizers in the
community who are- are bringing people together around common goals, shared
experiences is something that is really important and something that we need to move
toward. Um, I would just say that I'm- I'm less certain on- on the particular funding talk,
of a- of your proposal. So,um, something that I definitely want to see, I definitely want
to see more organizers in our community. As one myself, I can't say anything else. Uh,
but I- I am interested to see what we can do, if anything to find,um,you know, a new
revenue stream or- or a pre-existing revenue stream to,you know,making some type of
efficiency to make sure that this is paid for potentially in a different way. But,uh,
otherwise, I- I strongly support getting- getting more people on the ground and- and
building the kind of civic culture that in many ways our country used to have a lot more
strength with that,you know, I think a lot of digital social media and all that type of stuff,
um,has-has degraded. So I- I really strongly support getting more of those people on the
ground.
Thomas: I- I agree. And I have spoken with Laura and to a certain degree with Pauline as well.
How can we,you know, activate the strategic values and areas of community impact as-
as much as possible,uh,through the partnerships and engagements? So I,you know, I've
been, in addition to what has been said, I'm very interested in issues related to youth. I
think that is of would be a focus,uh, of any program that-that I would be particularly
supportive of And the notion of neighborhood is important in terms of structuring this, I-
I do believe that there's a- an opportunity for stronger governance at the neighborhood
level. And as we've been saying to try to activate social capital which is, I think working
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at a deficit for various reasons. So,um,right now,just having conversations, so I don't
have enough,um,you know, I can't translate it into a- a very clear vision,but I do think
the idea of potential partnerships with the school district and perhaps ICAD,the city. Um,
people who are already active in these neighborhoods. Um, and seeing collectively what
makes sense.
Alter: If I can piggyback because I am in a similar state where,um, I think that to be able to get
some another I'm on in who can help those in the community grow for themselves and,
and- and have that kind of ability as we've seen in the South district and the way in which
it's not centralized anymore,um,Angie Jordan would be the fust one to say she's
incredibly excited about the fact that more and more people are starting to own and- and
be a part of the-the fabric of the neighborhood, and that's what we want. So I'm
absolutely in favor of that. But I'm also remembering when we were talking on that
Saturday about maybe what it is that staff needs doesn't look like necessarily what we
want. Maybe it isn't front-facing. Maybe it is someone,um,who needs to be in the office
working on compliance or,um,what have you. I think it's a yes. And we need people out
there to help empower,um, different parts of the-the city. And then we also need to be
able to be cognizant of what staff needs,um,to help them do their work so that maybe
they can get out in the field more for- for those who would want to. Um, so like John, I'm
just kinda in the middle of conversation. Um, and I'll just throw another spanner into the
works,um, so to speak. But one of the things that actually the Mayor and I, um,when we
were in DC this past weekend,um,through conferences,we were told in no uncertain
terms,there will be a lot of federal money coming through and coming directly to
municipalities. And so one of the things that actually I would like us to think about sort of
dovetailing and thinking about perhaps this is one way in which we could fund such a
thing. Um, as Laura is talking about is money that's coming to us. Um,but I'm interested
in also raising it for conversation,um,to get going on actually having a grant writer and
perhaps in somebody who also,who could work with the compliance piece within city
staff.Not necessarily within a department,but a centralized like someone who is able to
go out and seek out these grants to work with staff to get the information that they need
and then to provide,um,to do the work of putting the grant together. Um,because I think
that staff is so strapped for time. Um, and there's so much going on that I think that this
could be useful. And I do apologize,Laura,because I realized I did this sort of like segue
into what,um,you know kind of a different venue. But,but I think that it is all of a piece
too. And we had talked about it where this is, sort of this larger view of what are the
strateg-what are our strategic values, and- and how do we achieve them?And the bottom
line is, especially at this time of year, it's understanding, it's about the budget and what
can we fund. And,um, I do think that actually putting someone in place who can actively
as their primary function, go out and find money for the city is going to help a lot,
especially in light of what the state is currently kind of assessing. So I throw that on the
table into the mix as well, but it's certainly not as an either-or situation,but just to say it
like wha-my- I guess my priority would be for this grant writing position,however, it's
with a full understanding that I think that we need to think aggressively to use your own
language about going after,um,what a community,um, outreach position could do since
we've seen how successful it is.
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Bergus: I- I think the theme is building capacity so that- so that staff has the ability to,you know,
aggressively move forward with our strategic priorities. And we know- I mean,what-
what's so heartening about these conversations is that we're not like all in different
directions. And most of the time,the limitations are staff capacity to carry forward our
goals. And I think we're just at an inflection point in terms of where we are with climate
and where we are with social justice, and where we are in the collaboration that we're
seeing in our social services and non-profit sector. That if we invest a little bit more right
now, it will pay off and it will help us create leadership and more capacity, I think,
quicker than if we just kind of status quo because we're scared of,you know,the-the
impending financial headwinds.
Harmsen: Well, I think the,um, the idea of,uh,the grant writer, especially with our- one of our
institutions,the University of Iowa,have several friends that work in various departments
over there. And that is such a huge part of their practice and they used to have, I'm not
sure if they still do because I haven't talked to anybody about this in a while,but people
who were like dedicated for like anybody in the university that would-would do the grant
writing. So that would say to me,there's probably people in our community that would be
qualified. Um, it would know,you know,we'd actually have a leg up on other
communities, ah,maybe,you know, other non-university or non-college communities,
finding people who have some experience and some skills in- in that area. And- and I
agree that's-that moves us towards things. So even if we- and- and I agree, getting some
more of the community organizing sort of positions and- and see if we can work that into
the-to the budget. And even if it doesn't fit into the budget as aggressively as- as we'd
like, if we have that really good grant writer and we were able to basically- some of those
hopes and promises from the federal level come into fruition,we can always amend our,
you know,we can add staff later in the year,right. So I mean,that's if grants become
available. So I mean, I- I see that as- as maybe a path forward that with all the news
we've been getting about our financial challenges that-that that gives me a lot more hope
than I think,you know,than-than doom and gloom,which is a nice feeling.
Teague: I think this is a great conversation that we're having is actually continuing,uh,the
conversation that we had on the 7th of January,um,because after Tracy Hightshoe had
given her presentation there was a lot of comments,um,by this council,um, and it
seemed like it was the,um, if we can figure out what are some of the ways that we can
bolster up the-that department to seem like a lot of the-the answers that we need for this,
um, community outreach, community partnership, community involvement could come
out of that. I think one of the things Geoff asked of us was,you know,um,to allow staff
to,uh,just to kinda take our concerns and then get back to us. I will say that the last
couple of weeks, as we all know,has been pretty busy here at the city,but,um, I still
think that that can take place.Now, one of the questions that I have is,you know,would
it be beneficial for,um,between now and,you know,the next meeting- although we do
have some time to change our budget,um, or to figure out this piece,but,you know, is-
would it be beneficial for us to give staff two weeks and then we have this discussion
again, determine if we want maybe a committee of three to kinda meet with staff and-
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and kinda talk through some opportunities,um,because we're- a lot of the things that was
said on the 7th is being repeated today,which I think is great,um, and-but-but I also
wanna make sure that,um,between now and when we need to pass this budget,that we
have had opportunity to,you know,have a conversation with staff,make sure that,uh, if
we need a special small group to work with staff to kinda,um, I think vocalize a little
more clearly what our hopes are,the vehicle for the funding,um, I think,you know,
certainly staff can give us some options. Uh,we've heard some,uh,possible vehicles that
the Council can take,um, so what are-what are your thoughts on if we give staff two
more weeks just to think about it and come back and give us some thoughts?
Harmsen: Just a quick, I try to find my notes,what's- and as part of this answer,maybe-what's
our set of deadlines we have coming up?
Fruin: You-you-we need to know your max property tax levy. So what I would say,just
listening to you talk, I'm seeing focus on two positions. It's the neighborhood outreach
position and it's the-the grant writer position that's articulated in the strategic plan,but
not proposed in- in my budget recommendation to you. Um, if you want to move ahead
with those two positions,you're probably looking at about $160,000, $175,000 of- of
additional expenditures in the FY24 budget. Um,that's something that we could absorb,
um,without raising the tax levy. You just have to understand that that eats- eats some of
that capacity, some of that cushion, some of that reserve, and it also creates a more
difficult situation should there be significant property tax reform pushed through. And,
you know,usually if you go through a cost-cutting measure,you know,the-the-the kind
of the-the general progression from a,um, from a typical how you'd handle that as you
look at the-the discretionary non-labor expenses. We know there's not much there. Then
you're gonna be looking at what kind of vacant positions can you leave unfilled,those
vacant positions you can't really control where they are at any given time. So sometimes
that has a disproportionate impact on- on service levels or- or various operations. So I- I
guess what I'm saying is if you're comfortable with the risk and you think the return to the
community,um, from adding one-and-a-half more positions,um-
Fruin: We can absorb that in the budget and we're just going to be reducing some of that cushion
that we have going forward that we've enjoyed for awhile. It's not it doesn't all go away.
They're both positions that were proposed by staff,um,to me. They just didn't make the-
the recommendation to you. If you're not comfortable with that,then you have to go
through that exercise of do you want to cut something from the budget?Do you want to
ask me to go and cut an equivalent amount of expense from the budget,um, or identify a
new revenue source. But I generally I don't think there's another revenue source to offer
up here. It's either going to be property taxes or- or living within th-the structure that we
have now.
Alter: One very quick thing and as a question more than anything,um, is, I think I had
mentioned to you th-that the possibility of a long-term temp hire with a grant writer
essentially using a position as a- as a pilot,right?And perhaps use ABPA funds for that?
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I don't know if that's a possibility,but I just throw that out there as well. If we're trying to
consider since we have some dollars.
Fruin: Yeah,we can certainly look at a short-term solution. The challenges,you may not attract
the best candidates because of those candidates are going to want something more secure,
particularly in this job market,they-they probably have no problem finding something
more secure. So I would- I would- say if we want to jump into that centralized grant
management,um, grants position. Let's- let's go all in.
Alter: You're right,yeah.
Fruin: And let's try to get the best person we can and hope that that return is there. I trust it will
be. So I'd- I'd say, let's do that. Maybe we can use-maybe we use ABPA,but as part of
the financial solution in the short term. But in making that commitment during the hiring
process, I think we need to commit to-to a permanent hire.
Alter: Thank you.
Teague: In regards to the property tax, I know that Rachel Kilburg had given us,kind of,walked
us through some of that stuff and also we know what's happening at the state. We don't
know exactly what yet. But they're having discussions about property tax. I know that,
we would have to make the decision really bad at 31st of this month in order for us to set
a public hearing for any proposed maximum property tax by 7th of February. So my
question is, and I'm not really suggesting that we increase the property checks are
changing at this point,but,um, I guess this is really to staff. Is there any benefit to us
even looking at that?We know that things are coming, if we don't move now, could we
be limited?You know. Are there any things that we should probably think about now?
The other thing is if we're going to- if we know that there's going to be some changes in
decreases in our overall budget. Do we wait and then we do this huge hike, or do we do
these incremental hikes that we know are coming?Almost inevitable. So I don't know if
staff can talk to that and-
Fruin: Well, I think it's hard to make these types of decisions based on speculation, and that's all
we have right now. We have various property tax bills introduced,um,but we don't know
what the end product is going to look like. So I always like to make decisions when we
know what that-what that new reality is. I would hesitate at this point to change our
taxing strategy or to make drastic changes to the budget in anticipation of something. I
think we move forward as we always do, and we-we-we make changes accordingly once
legislation has passed and we hope that we have the benefit of a year to make those
changes, or multiple years to make those changes. But know that there is a risk that it
could be that we only have weeks to-to-to make a change. You just need to take comfort
in knowing that we do have some- some reserves that can help provide that cushion
should that short-term pain be thrust upon us in a-in a quick manner.
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Harmsen: I think kind of piggybacking off of the mayor's-mayor's comments and maybe picking
up a thread that I put up there,maybe not perfectly clearly earlier. Do we want to have
some sort of-we set this maximum levy rate, do we want to have-bump that up? I know
that's not the- in my expectation is to not have to use it. And if we just- so we have that
ability, if we find out between now and March 31st that we are going to get something
that would require us to make some drastic cuts to services that we at least have an option
on the table or is that something that would cause more problems than it fixes? Or do we
want to maybe just be thinking about that and maybe come back in two weeks and-and
make a decision. I mean, is it set a plan B that we should have on deck and ready to go?
Fruin: Knowing that the proposed legislation right now for the rollback is about 1.7 million. I
think we can manage that without drastic cuts to services,um, in the short term. So I
personally don't see the need to increase just in case in this- in this manner. I would say,
let's stay the course. If those changes are thrust upon us,we can figure that out for this
budget. Again,we've had a multi-million dollar surplus the last few years in our budgets,
and that's partly because we budget conservatively,right? I use the example,we budget
for 100 percent of the salaries that are on the books. But we know in any organization
you have turnover and then when you have turnover,you're not paying a salary while
there's a transition in employees. So that's where we-we get a lot of- we get a lot of our
cushion and our savings. I think in this case,we could-we could manage it and not to say
it wouldn't be without pain,but we can manage it. I just- I hesitate to-to set that public
hearing,make that announcement to the community that we're looking at this major rate
hike and for the state stuff to fizzle out. And it looks like we-you know,maybe we were
in jumping the gun or had different motives.
Harmsen: Thank you. That makes sense.
Dunn: Question for you. So if we were to do an increase solely just to recoup the 1.7 million,
um,what kind of increase would that look like compared to what we have proposed now?
Fruin: I don't know that we could fully make that up. We generally say it's about $50,000 per
penny on the- on the tax levy. But again,that 1.7 hi-hits us a little bit differently,right?
There's about 1.2 million to the general fund, so I'm going to hit the transit fund. So I- I
don't think I'm prepared to kinda tell you exactly what that impact is right now,but you
can generally assume about $50,000 equates to one penny on your tax rate.
Teague: Also, it is 5:47. I'm going to pause us at this point. We kind of, gave indirectly,but
maybe we gave Geoff som- some marching orders for those one-and-a-half positions to
come back next time.
Bergus: Can I say two,two full-time?
Teague: I think what you mentioned was a half.
Bergus:No. I said the current is halftime and we need to-
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Teague: And I think he was saying one and a half to make it four.
Fruin: I was saying to make it full time,but it's-
Bergus: So we would have one- I want to see us have at least one-and-a-half FTE in that
position. So adding a full-time and then the full time grant writer.
Teague: Yeah, I got that.
Bergus: Okay.
Teague: Yes.
Bergus: So we need to add two then.
Fruin: Two FTEs.
Teague: Yeah. [OVERLAPPING] Yes. Okay. Sorry. Yeah. The organizers or their community
outreach not-
Harmsen: One community outreach, one grant writer.
Bergus: Right.
Fruin: Correct.
Fruin: So just to clarify then,because I gave you a rough estimate off the cuff of 150-175. I think
I said something about that and we're probably looking at 225. You just add another
about 50,000 to that estimate if you're looking at another half-time.
Teague: All right. So we'll get updates,um, February 5th.
Fruin: Well
Teague: I think.
Fruin: But we're-you're going to proceed ahead with the-the setting of the maximum tax levy as
staff has proposed in the budget. And if come your next council meeting at the work
session,you want some information from me on thoughts on those two positions
essentially?
Teague: Correct. Yes.
Fruin: Okay.
This represents only a reasonably accurate transcription of the Iowa City City Council work
session of January 24, 2023.
Page 11
Teague: Yeah. All right. If nothing else will be adjourned for now and see you at 06:00 P.M.
This represents only a reasonably accurate transcription of the Iowa City City Council work
session of January 24,2023.