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Home My WebLink About2005-01-06 Info Packet J -&' t CITY COUNCIL INFORMATION PACKET CITY OF [OWA CITY January 6, 2005 www.icgov.org MISCELLANEOUS ITEMS IP1 Tentative City Council Meetings and Work Session Agendas IP2 Letter from the Mayor to The Honorable Thomas J. Vilsack: Nominee Steve Sovern-lowa Department of Transportation Commission IP3 Letter from the Mayor to the Iowa City Area State Legislative Delegation: Legislative Issues IP4 Memorandum from the City Manager: Airport-Iowa DOT Grants IP5 Memorandum from the City Manager: Public Information Process-Summer of '05 Capital Projects IP6 Memorandum from the City Clerk: Agenda Items for Joint Meeting IP7 Memorandum from the City Clerk: 2005 Meeting Schedule- First Quarter IP8 Memorandum from the City Clerk: January 10 Budget Presentations IP9 Letter from James and Becky Buxton to the Mayor: Alterations or repair not allowed on houses in historic districts IP10 Memorandum from the City Engineer to the City Manager: Bowery Brick Street Repair Project IP11 Letter from Donald Guckert to the City Manager: Deer Sharpshooting Program IP12 Letter from John W. Hayek to the Fire Chief: Thank you for Tour IP13 Building Permit Information - December 2004 PRELIMINARY DRAFT/MINUTES IP14 Board of Appeals: DecemberC, 2004 IP15 Parks and Recreation Commission: December 8, 2004 IP16 Airport Commission: December 9, 2004 IP17 Telecommunications Commission: December 20, 2004 January 6, 2005 Information Packet (continued) 2 COUNCIL PACKETS ONLY- I AVAILABLE IN CITY CLERK'S OFFICE OR ON-LINE (www.ic~lov.or~l) I Comprehensive Annual Financial Report FY June 30, 2004 (Budget) ~ City Council Meeting Schedule and ~ Work Session Agendas ~,~r~, 200~ CITY OF IOWA CITY www.icgov.org · MONDAY, JANUARY 10 EmmaJ. HarvatHall 6:30p Special Budget Work Session Boards and Commissions · TUESDAY, JANUARY 11 Emma J. Harvat Hall 12:00p-7:00p Budget Work Session TENTATIVE FUTURE MEETINGS AND AGENDAS · MONDAY, JANUARY 17 Emma J. Harvat Hall Martin Luther King Jr. Day Holiday - City Offices Closed · TUESDAY, JANUARY 18 Emma J. HarvatHall TBA Special Work Session 7:00p Regular Formal · SATURDAY, JANUARY 29 Emma J. Harvat Hall 11:30a Special Work Session with lC Legislators re: Priorities · MONDAY, JANUARY 31 Emma J. Harvat Hall 6:30p City Conference Board Meeting Separate Agenda Posted TBA Council Work Session · TUESDAY, FEBRUARY 1 Emma J. Harvat Hall 7:00p Regular Formal · MONDAY, FEBRUARY 14 Emma J. Harvat Hall 6:30p Council Work Session · TUESDAY, FEBRUARY 15 Emma J. Harvat Hall 7:00p Regular Formal · MONDAY, FEBRUARY 28 Emma J. Harvat Hall 6:30p City Conference Board Meeting Separate Agenda Posted TBA Council Work Session · TUESDAY, MARCH 1 Emma J. HarvatHall 7:00p Regular Formal Meeting dates/~imes/topics subject to change FUTURE WORK SESSION ITEMS Regulation of Downtown Dumpsters January 5, 2005 CITY OF IOWA CITY 4 I0 East Washington Street Iowa City, Iowa 52240-1526 (3~91 ]se-sooo The Honorable Thomas J. Vilsack (3~v) 356-5009 FAX Governor ,,ww. icgov, erg State Capitol Des Moines, IA 50319 Re: Steve Severn Dear Governor Vilsack: Please allow me to respectfully express my strong support for Steve Severn as a nominee for appointment to the Iowa Department of Transpodation Commission. Steve has a long history of business experience and voluntary public service to the State of Iowa and to his community. He has held various State and local offices as either an elected or appointed official, including the Iowa Senate, and has served on a variety of advisory boards, commissions, and committees in both the public and private sectors. Like a great many of my fellow Iowans who are business persons and elected officials in the Cedar Rapids - Iowa City area, and who are familiar with the knowledge, enthusiasm and dedication Steve can offer to all Iowans, I encourage your favorable consideration of Steve Severn for appointment to the IDOT Commission. I am confid~nt that he will serve all the people of Iowa in an exemplary fashion. Thank you for your consideration. Si~/~,j'ely, Ernest W. Lehman, Mayor City of Iowa City cc. City Council Jim Griffin, President, Iowa City Area Chamber of Commerce Joe Rase, President, Iowa City Area Development Group CITY OF IOWA CITY 4 I 0 East Washington Street Iowa City, Iowa 52240 1826 SAME LETTER SENT TO: The Honorable Robert Dvorsky (319) 356-5000 The Honorable Joe Bolkcom (319) 356 5009 FAX The Honorable Jim Hahn www.icgov.org The Honorable David Jacoby The Honorable Jeff Kaufmann The Honorable Vicky Lensing The Honorable Mary Mascher January 6, 2005 Dear The City Council of Iowa City would like to meet with legislators to identify legislative priorities for the upcoming session. After talking with a number of you it was determined that Saturday, January 29, at 11:30 AM would be the most acceptable. Please reserve one hour (11:30-12:30) on Saturday morning, January 29, on your calendars. The meeting will take place in Harvat Hall of City Hall immediately following the League of Women Voters Forum. Thank you for setting aside time to meet with us and we look forward to a short productive meeting. I am attaching a copy of legislative issues identified in earlier Council discussion. Sincerely, Ernest W. Lehman Mayor Attachment Date: January 6, 2005 To: Iowa City Area State Legislative Delegation From: Iowa City City Council Re: Legislative Issues Recently, the City Council convened in an informal work session to discuss various legislative issues they would like to bring to your attention. These issues are intended to provide you with some of our concerns and how state legislation might be undertaken to address these concerns. 1. Hotel Tax - The City Council would be interested in the hotel/motel tax cap being raised from 7% to 9%. The Council is aware of how the current law restricts the expenditure of these tax funds. We did, however, specifically note that cultural activities would be an area of interest for financing with respect to a new source of hotel/motel tax income. 2. Condominium Taxes - Developers often build new "apartment buildings" to be leased by the ownership interests as income property and yet by merely calling them "condominiums" avoid the full taxable value by securing residential rollback. In that these "condominium" units are not truly owner-occupied it is the Council's position and concern they should be taxed at a rate that is similar to other commercial properties and income- producing apartments. Furthermore, there should be no provision for grandfathering of the existing condominium/apartments as well as halting further conversions. 3. Property Tax Code - While there are a number of issues associated with the property tax rules and regulations, of specific concern to the Council is the desire to have a minimum rollback guarantee. It is difficult to budget on an annual basis when the value of residential property is subject to an annual formula-driven reduction. Long-term planning can be more effective if rollback is stabilized at a particular percentage. 4. Penalties for Alcohol Violations - While there is much discussion and many opinions about alcohol abuse, of particular concern is the fine schedule, notably possession of alcohol under the legal age (PAULA). The $100 fine is simply not sufficient to be a deterrent to this type of alcohol abuse activity. It has been suggested that $500 for each PAULA violation would be a far more effective deterrent. Furthermore, all of these Januaw 6,2005 Page 2 problems associated with alcohol misuse, including public intoxication, alcohol distribution by license holders, fake IDs, etc. are of a serious community concern. 5. Labor Contracts - In the current public employee bargaining laws, the arbitration process is ultimately guided by the comparison of proposals with only other public agencies. In our case it is most often the ten largest cities in Iowa. Comparing public agencies only makes it difficult to achieve a realistic picture of what the actual employee market is for a particular position and the scale of wages and benefits that must be paid. In order to achieve better cost control, comparison with the private sector (clearly the largest employer throughout the state) is being excluded for comparison purposes and therefore difficult to have the City discover the "real" market for employee wages in a comparable position. A change in the public employee bargaining law to allow a broader comparison opportunity would be helpful to managing costs. 6. No Smoking - The adoption of legislation which would grant the City the ability to provide its own initiatives as it relates to smoking regulation. This would allow us to act at the local level on this important community issue. mgflmem/legislation ,doc Date: January 4, 2005 To: City Council From: City Manager Re: Airport - Iowa DOT Grants Attached is a copy of a memorandum I received from the Airport Commission concerning pending airport grants. The Commission did not include them in their budget proposal. Given the size of the grant match requirements, I believe we can accommodate these requests. It would be my intent at the conclusion of our budget review to add a line item in the Capital Plan to provide budget authority for these matching grants. Cc: Randy Hartwig Kevin O'Malley Mgdmemors/airportl-4.-O5.doc IOWA CITY MUNICIPAL AIRPORT 1801 South Riverside Drive Iowa City, Iowa 52246 Office Phone (319) 356-5045 27 December 2004 To: Steve Atkins Re: Iowa D.O.T. Grants Steve, As per our conversation, I am forwarding this memo concerning the availability of some D.O.T. grants which I believe were not included in the budget. FY 2002 IDOT Hanger Roof Repair- Local match (30%) $21,428.57 FY 2005 IDOT Hanger Roof/Floor Repair- Local match $21,428.57 FY 2005 IDOT Airfield Signage - Local match $1,560.00 FY 2005 IDOT Fencing replacement - Local match $ 2,060.00 This omission was inadvertent; I believe the projects warrant inclusion and make sound use of our resources in upgrading / maintaining Airport infrastructure. ull~ Randy Hartwig Iowa City Airport Commission IOWA CITY RANDUrvl Date: January 4, 2005 To: City Council From: City Manager Re: Public Information Process - Summer of '05 Capital Projects We are planning an expanded public information effort through JCCOG for this spring and summer for four specific capital projects. These projects will encumber the entranceways into Coralville and Iowa City from 1-80. They are Dodge Street, the intersection of Dubuque and Foster, the intersection of 1st Avenue Coralville and Ninth Street, and U.S. 6 Clear Creek to 12th Avenue Coralville. Our information specialist, Mary Abboud, in our Department of Planning and Community Development is working on developing a process whereby we can have updates, hopefully fairly frequently such as on a weekly basis, whereby we can have the media informed of construction activities that could create delays. Our focus is the motoring public. With the timing of these projects we will be encumbering the entrance to our community in a substantial way over the next year. Hopefully this public information process will help. Mgdmemos/publicinfo.doc DATE: January 5, 2005 TO: Mayor and City Council FROM: Marian K. Karr, City Clerk ~'- RE: Agenda Items for Joint Meeting Johnson County will be hosting the next joint meeting of the City Councils of Iowa City, Coralville, and North Liberty; the Iowa City Community School Board, and the Johnson County Board of Supervisors. The meeting date, originally scheduled frown January 19, has not been confirmed. However, Council has stated their preference to a January 26 date. Please forward any agenda items to me no later than Thursday, January 13. The meeting is scheduled to last about two hours. Because of time constraints items will be reviewed by the Mayor prior to submission. A complete agenda and meeting date confin-nation will be available in your packet preceding the meeting. cc:~oin~meetingrcq uestl~r~tems.doc DATE: January 5, 2004 TO: Mayor and City Council FROM: Marian K. Karr, City Clerk ~e~ RE: 2005 Meeting Schedule - First Quarter Council agreed to the following schedule at the January 3 work session: Thursday, January 6 - Special Formal meeting and Budget Work Session (8:30 AM - 3:00PM) Monday, January 10 - Special Budget Work Session (6:30 PM) Boards and Commissions Tuesday, January 11 - Budget Work Session (noon - 7:00 ) Monday, January 17 - City Holiday Tuesday, January 18 - Special Work Session (TBA) Regular Formal (7:00 PM) Saturday, January 29 - Special Work Session with IC Legislators re Priorities Monday, January 31 - Regular Work Session Tuesday. February 1 - Regular Formal (set budget public hearing) Monday, February 14 - Regular Work Session Tuesday, February 15 - Regular Formal (hold budget public hearing) Monday, February 28 - Regular Work Session Tuesday, March 1 Regular Formal (approve budget) Monday, March 21 - Special Work Session Tuesday, March 22 ~ Special Formal All meetings are in Harvat Hall. Please note that a special work session with area legislators has been tentatively set for 11:30 AM on Saturday, January 29. cc: City Hall Maintenance Cable Department Directors U:2005quarterlyschedule.doc CITY UM DATE: January 6, 2005 TO: Boards and Commissions FROM: Marian K. Karr, City Clerk RE: January 10 Budget Presentations Council budget work session of January 10 will hear from City Boards and Commissions regarding their request affecting the FY06 City budget. The following schedule was prepared to include a 5 minute oral presentation followed by a five minute question period. Presenters should plan on arriving 10 minutes ahead of their assigned time. ORGANIZATION NAME 6:35-6:50 Senior Center Comm. Jay Honohan, Chair & Linda Kopping, Coordinator 6:50-7:05 Library Board David VanDusseldorp, Chair & Susan Craig, Director 7:05-7:20 Airport Commission Randy Hartwig, Chair 7:20-7:35 Parks & Rec. Commission Craig Gustaveson, Chair & Terry Trueblood, Director 7:35 General Budget Discussion cc: City Council s/January 10 bdcomm schedule.doc JAMES B. AND BECKY J. BUXTON IP9 1811 MUSCATINE AVENUE IOWA CITY, IOWA 52240-6414 (319) 354-7262 DATE: 12/10/2004 FACSIMILE MESSAGE TO: Ernie Lehman, Mayor, City of Iowa City FAX: (319) 356-5497 FROM: James B. Buxton PHONE'. (319) 354-7262 " FAX: (319) 338-3090 SUBJECT: List of alterations or repair not allowed on houses in historic districts. #3 PAGES FOLLOW THIS SHEET. IF YOU HAVE PROBLEMS WITH TRANSMISSION, PLEASE CALL (319) 354-7262, Thank-you very much, Mr. Lehtnan~ :for requesting the list of repairs and improvements not allowed in historic districts, As of today's date I personally know of three homes in the North Gilbert/Linn district that have vinyl siding jobs in process. We are the proud owners of two of the homes: 225 Church and 402 East Davenport. The other is located at the Southeast corner of Linn and Davenport. We feel that it would be very unfair if the proposed historic district would pass and slm!lar siding projects would be strictly prohibited. We purchn.~ed the home at 402 East Davenport on November 1, 2004, after it had been sitting vacant and neglected for the better part of 10 years, It wasi~ complete eyesore. There even was a junk car sitting in the driveway for i0 years. Our list of repakrs and improvements is extensive, and it includes vinyl siding installation, window replacement, new roof, new furnace, new electrical service, new kitchen, new bathroom, and new plumbing. The interior will be completely repainted, plaster repaired, fireplace reactivated, and hardwood floors all refini.~hed. When complete it will once again be a beautiful home! The exterior items would be prohibited under the proposed ordinav, cm, in our case the vinyl siding and the replacement windows. This is way too much of an infringement on the rights of the owners. It puts the City in the position of setting the standards for what is "appropriate." The properties were all purchased by the owners before this ordinance, and to impose thi.~ whole new set of rules and regulations on owners after the fact is not right. Property owners like' vinyl siding because it has much more permanence than painted siding. A home with new vinyl siding will retain its 'new siding~ look many years after the painted siding needs repainting. Please stop and take a look at the 402 East Davenport home if you would like to see what old painted siding looks like. It is just a few short blocks from the Civic Center. ff you are interested I can show you another home that has been sided using exactly the same siding and colors being used at the East Davenport home, It turned out very nice and many people have gone out of their way to compliment the owners. Please review the enclosed list of restrictions und~ the historic district and let me know if you IMPORTANT INFORMATION FOR ALL PROPERTY OWNF IN THE HISTORIC DISTRIC'r, IN IOWA CITY, IOWA. DATE 2004 The following is a short list of ALTBRATIONS OR REPA~ that are NOT ALLOWED on ally hous~ or building In a Historic District in Iowa City, Iowa as of 11004, (1) FOUNDATIONS - CANNOT cover exposed brick, stone or block with cement plaster or stuCCo. CANNOT raise grade at foundation. CANNOT paint masonry or concrete foundations that were not painted originally. (2) MASONRY - CANNOT point historic soft masonry with an strong Portland cement mix or synthetic caulking compoun~ (3) WOOD- CANNOT cover original wood siding, soffits and cave boards with allother illaterial $11ch as vinyl or ahlrainnm siding. CANNOT nsc paint removal methods such as sandblasting, water blasting or burning with a propane or butane torch. CANNOT remove historic wood elements such as trim: porches, cornices and di~orstive elements. (4) MASS AND ROOFLINES - CANNOT substantially alter the roof pitch to gain headroom below rulers. CANNOT add donners thst axe wider than olles commollly found in the neighborhood or on buildings of similar al~hltectllral style. ~_.~]NOT ilkstall itlltelllla~ vents, Solar collectors, skyllghLs or other iIlechanlcal dovico8 prominent street elevations. (5) SIDINO- CANNOT remove historic trim pieces such as door and window trim, skin and frieze bosrds, and comer boards. CANNOT cover historic trim such as door sad window trim, skin and frieze boards, sad comer boards. CANNOT apply syntheitc siding such as ~luminum, vinyl, or false masonry siding. (6) PAINT AND COLOR-CANNOT use dry sanding, sandblasting or using high- pressure sprayers to remove paint from masonry or wood. CANNOT use high h~at or open times for paint removal. CANNOT use paint strippers containing methylene chloride. CANNOT use other methods with a high potential to create lead dust that are discouraged by State sad Federal guidelines. CANNOT use bright,or obtrusive paint colors. CANNOT paint a building entirely white, CF) WINDOWS - CANNOT install modem types of windows including sliding, awning, Casement said bay willdows when they were not original to thc buil.ding, or consistent with the architectural style, or required for egress. CANNOT install metal, vinyl clad or vinyl windows when they were not original to the building. CANNOT us~ snap-ill muntin bars to achieve the appearance of divided - lights. CANNOT use ~ or vinyl storm windows, CANNOT install shutters on windows that did not have shutters, ($) DOORS - CANNOT install flush entrance doors or other modem door styles. CANNOT install sliding patio doors if they were not original to thc building or consistent with the architectural style. CANNOT install natural aluminum storm doors. CANNOT block down door openings to accommodate standard door sizes. CANNOT install a double-ear garage door where two single-car doors are possible. (9) PORCHF~ - CANNOT remove a historic front porch. CANNOT change the original roof pitch. CANNOT use newer materials including EPDM rubber sheeting and heat-sealed asphalt. CANNOT enclose front porches or other porches that are higMy visible from the street. CANNOT use wrought iron elements unless they were part of the historic design. CANNOT use unpainted treated wood for elements that would have been painted in their Mstodc applications. CANNOT use precast concrete steps on the front or side elevation if the steps will be highly visible from the street. CANNOT use substituting material in place of wood that does not retain the appearance, function, and paintability of the original wood. (10) BALUSTRADF. B AND HANDRAILS- CANNOT remove historic balustrades or railings. CANNOT cover thc historic balustrades or railings with materials such as siding. CANNOT use unpainted treated wood for elements that would have been painted in the historic application. CANNOT use wrought iron elements unless they were part of the historic design. (Il)GUTTERS AND DOWNSPOUTS - CANNOT alter the S~O~ near the gutter when coveting Mstofic built4n gutters. :i'::' (12) SITE AND LANDSCAPING - CANNOT provide parking spaces between the primary' strl~tlLr~ and the street. CANNOT add curb cuts and driveways from the street when aec, ess is available from the alley. CANNOT remove historic metal fences. CANNOT replace historic brick paving with concrete. CANNOT remove mature trees, unless tree is causing damage to the building, is diseased, or is structurally unsonnd, as determined by a professional arbofist. CANNOT install chain link, wire mesh or rail fences in locations highlY visible from the strc, et. (13) DECKS AND RAMPS-CANNOT construct a deck between the street and the street-facing facade if it detracts from the neighborhood or is not compatible with the architectural style of the existing building. CANNOT construct a ramp that extends more than 8 feet in front of the primary, street-facing faqade. (14) GARAGES - NOT RECOMMENDED to construct a garage that attaches to the primary building. (15) DEMOLITAION - CANNOT demolish any primary building on a contributing property within a conservation or historic district or any Iowa City Historic Landmark. CANNOT remove any historic architectural feature, such as a porch, ch/mney, bay window, do,'mcr, brackets or decorative trim, that is significant to the architectural character and style of the building. The attachment to the letter dated December 10 from James Buxton is a list of alterations or repairs that Mr. Buxton has compiled from the Iowa City Guidelines of the Iowa City Historic Preservation Handbook, which he asserts are not allowed in a historic district. However, this list is taken out of the context of the Handbook. Section 2.0 Historic Review of the handbook explains that many alterations do not required a building permit and therefore, historic review is not required. The Historic Preservation Commission chose to include alterations in the guidelines that do not require a permit for educational purposes. The guidelines do allow for some flexibility. Section 3.0 of the handbook states: "In writing the historic preservation guidelines, the Historic Preservation Commission has made every effort to clarify the criteria for historic review. However, not every situation can be anticipated. The Commission, at its discretion, may allow some flexibility for unique properties and situations." Because of tkie need to allow flexibility, the guidelines for historic review are provided in the Historic Preservation Handbook rather than being included in the Unified Development Code. Likewise, alternative design solutions are allowed provided the scope or quality of work required is not reduced (page 12). I have listed below all the items from the guidelines that Mr. Buxton included on his list. Items that do not require a permit or historic review are indicated with a diamond symbol (~.). Staff comments have been italicized. 4.1 Foundations Disallowed: Historic foundations Covering exposed brick, stone, and textured concrete block foundations with a cement piaster or stucco. Not Recommended: Historic foundations · Raising the adjacent grade at the foundation to cover what was historically exposed. · Painting masonry or concrete foundations that were originally unpainted. 4.2 Masonry Disallowed: Historic masonry · Sandblasting, water blasting, or any other abrasive cleaning method. Blasting can cause very serious damage by destroying the protective exterior surface and exposing the softer interior to rapid deterioration. This damage cannot be repaired. Pointing soft historic masonry with a strong Portland cement mix or synthetic caulking compound. Hard mortars will damage soft historic masonry such as brick. 4.3 Wood Disallowed: Historic wood Covering original wood siding, soffits and eave boards with another material such as vinyl or aluminum siding. Using destructive and dangerous paint removal methods such as sandblasting, water blasting, or burning with a propane or butane torch. Removal of historic wood elements such as trim, porches, cornices, and decorative elements. Wood substitutes Substituting a material in place of wood that does not retain the appearance, function, and paintability of the original wood. 4.4 Mass and Rooflines Disallowed: Original roofline and mass Substantially altering the roof pitch of a historic building on one or both sides of the roof to gain headroom below the rafters. New dormers Adding dormers that are wider than ones commonly found in the neighborhood or on buildings of a similar architectural style. Not Recommended: Installing antennas, vents, solar collectors, skylights, or other mechanical devices on prominent street elevations. (Not all of these items require a building permit.) 4.5 Sidin.q Disallowed: Historic trim Removing historic trim pieces such as door and window trim, skirt and frieze boards, and corner boards. Covering historic trim such as door and window trim, skirt and frieze boards, and corner boards. Synthetic siding Applying synthetic siding such as aluminum, vinyl, or false masonry siding. 4.6 Paint and Color Not Recommended: Repainting · Dry sanding, sandblasting or using high-pressure sprayers to remove paint from masonry or wood. · Using high heat or open flames for paint removal. · Using paint strippers containing methylene chloride. · Using other methods with a high potential to create lead dust that are discouraged by State and Federal guidelines. Paint color · Choosing bright, obtrusive colors. · Painting a building entirely white. 4.7 Windows Disallowed: New and replacement windows Installing modern types of windows including sliding, awning, casement, and bay windows when they were not original to the building, consistent with the architectural style, or required for egress. Installing metal, vinyl clad or vinyl windows when they were not original to the building. Using snap-in muntin bars to achieve the appearance of divided-lights. Not Recommended: Storm windows · Installing exterior metal or vinyl storm windows. Shutters · Installing shutters on windows that did not historically have shutters. 4.8 Doors Disallowed: New doors · Installing flush entrance doors or other modern door styles. (Changing only an entrance door does not require a permit) Installing sliding patio doors if they were not original to the building or consistent with the architectural style. Blocking down door openings to accommodate standard door sizes. Not Recommended: Installing a double-car garage door where two single-car doors are possible. 4.9 Porches Disallowed: Historic porches Removing a historic front porch. Changing the original roof pitch. Newer materials including EPDM rubber sheeting and heat-sealed asphalt products make the maintenance of Iow-pitched roofs easier than in years past. (Mr. Buxton states that the items in the previous sentence cannot be used. This is in error. EPDM and rubber sheeting are recommended in lieu of raising the roof pitch.) Enclosing front porches or other porches that are highly visible from the street with permanent windows and/or walls. New materials Using wrought iron elements unless they were part of the historic design. Using unpainted treated wood for elements that would have been painted in their historic applications. Using precast concrete steps on the front or side elevation if the steps will be highly visible from the street. They are acceptable on the rear elevation. Wood substitutes Substituting a material in place of wood that does not retain the appearance, function, and paintability of the original wood. 4.10 Balustrades and Handrails Disallowed: Historic balustrades and handrails Removing historic balustrades or railings. Covering the historic balustrades or railings with materials such as siding. New balustrades and handrails Using unpainted treated wood for elements that would have been painted in the historic application. Using wrought iron elements unless they were part of the historic design. 4.11 Gutters and Downspouts Disallowed: Roof slope Altering the roof slope near the gutter when covering historic built-in gutters. 4.13 Site and Landscapin.q Disallowed: · Providing parking spaces between the primary structure and the street. (For detached single family dwelling, under the building code, only one parking spaces is allowed along a regularly constructed aisle. For multifamily dwellings in the Central Planning District, parking lots must be located behind a building or below grade.) · Adding curb cuts and driveways from the street when access is available from an alley. · Removing historic metal fences. Not Recommended: · Replacing historic brick paving with concrete. · Removing mature trees, unless tree is causing damage to a building, is diseased, or is structurally unsound, as determined by a professional arborist. Fences · Installing chain link, wire mesh or rail fences in locations highly visible from the street. (Permit is only required if fence is more than 6' high) 5,2 Decks and Ramps Decks Disallowed: Constructing a deck between the street and the street-facing facade if it detracts from the neighborhood or is not compatible with the architectural style of the existing building. Ramps Not Recommended: Constructing a ramp that extends more than 8 feet in front of the primary, street facing fa(;ade. 7.0 Demolition Disallowed: Demolishing any primary building on a contributing property within a conservation or historic district, or any Iowa City Historic Landmark. Removing any historic architectural feature, such as a porch, chimney, bay window, dormer, brackets or decorative trim, that is significant to the architectural character and style of the building. City of Iowa City MEMORANDUM TO: Steve Atkins, City Manager FROM: Ron Knoche, City Engineer ~_. DATE: December 28, 2004 RE: Bowery Brick Street Repair Project Kelly Construction, Inc. of Davenport, Iowa has completed the repair of Bowery Street between Summit Street and Clark Street. The work took four weeks to complete and the final cost was $24,076.22. The average cost of the repair was $139 per square yard. L1N IVERSIq'Y FACILITIES MANAGEMENT OF IOWA Mr. Stephen J. Atkins City Manager City of Iowa City 410 E. Washington Street Iowa City, IA 52240 Dear Mr. Atkins, The University has reviewed your October 7, 2004 request to allow White Buffalo Inc. access to UI property to reduce the deer population through a sharpshooting program. Your original request identified a December 2004 time frame and that was reviewed by our Campus Planning Committee. In our meeting with you and White Buffalo we discussed that, if the University were to permit access, the winter semester break would be the preferred time. We have reviewed the City's most recent request to have access to university land in February, following the semester break period. Given the February timing and the expressions of concern for individual safety we have received, our judgment is to not allow the City access. However, we would be pleased to consider a similar request next year, provided the program would be conducted for a time falling within the winter semester break period. Donald G uL'k,2~ Associate Vice President and Director Facilities Management cc: Doug True I210 University Services Building Iowa City, IA 52242-1922 319-335-1201 Fax: 319-335-1210 wwwJacilities.uJowa.edu IP12 HAYEK, HAYEK, BROWN, MORELAND & HAYEK, L.L.P. ATTORNEYS AT LAW JOSEPH T. MORELAND M^~-T.~w J. M^¥EK' December 22, 2004 Mr. Andrew Rocca Fire Chief Iowa City Fire Department Civic Center 410 East ~Washington Street Iowa City, Iowa 52240 Dear Mr. Rocca: I am writing to you to thank you and your staff for a very pleasant and informative tour of the central station facilities that you arranged for my grandchildren and me along with Matthew Hayek last Saturday. Jerry Blank and Ken Brown of the command staff were most hospitable. Firefighters Joe Corbin and Brandon Smith acted as our particular hosts and gave six year old William and four year old Eleanor as well as somewhat older Matthew and John a wonderful tour of the central station. I know that you are very proud of your fire department and you should be proud of it. It is a most impressive organization of dedicated professionals serving Iowa City. want to again thank you and Steve Atkins for setting this up. Best wishes. Very truly yours, John W. Hayek Cc: Iowa City City Council c/o Marian Karr, City Clerk Stephen Atkins .... . IP13 BUILDING PERMIT INFORMATION December 2004 KEY FOR ABBREVIATIONS · Type of Improvement' ADD - Addition AL T- A Iteration REP- Repair FND - Foundation Only NE W - New OTH- Other type of construction Type of Use: RSF- Residential Single Family RDF - Residential Duplex RMF - Three or more residential RA C- Residential Accessory Building MIX- Mixed NON- Non-residential OTH- Other Page: 2 City of Iowa City Date: 1/3/2005 Extraction of Building Permit Data for To: 12/1/2004 Census Bureau Report From: 12/31/2004 Type Type Permit Number Name Address lmpr Use Stories Units Valuation BLD04-00940 SOUTHGATE DEV CO INC 1905 BROADWAY ST ADD NON 1 1 $253,400 ADDITION AND ALTERATION TO NEW GOODWILL STORE BLD04-00855 VERIZON WIRELESS 210 S DUBUQUE ST ADD NON 1 0 $45,000 ROOF TOP ANTENNAE ON HOTEL Total ADD/NON permits: 2 Total Valuation: $298,400 i BLD04-00703 JAMES A & LORETTA C CL,q 633 S DODGE ST ADD RMF 3 0 $9,000 EXTERIOR DECKS BLD04-00704 JAMES A & LORETTA C CLA 625 S DODGE ST ADD RMF 3 0 $9,000 EXTERIOR DECKS BLD04-00712 AUR 444 S JOHNSON ST ADD RMF 3 0 $9,000 EXTERIOR DECKS BLD04-00715 AUR 504 S JOHNSON ST ADD RMF 3 0 $9,000 EXTERIOR DECKS BLD04-00723 AUR 436 S VAN BUREN ST ADD RMF 3 0 $9,000 EXTERIOR DECKS BLD04-00693 AUR 402 S GILBERT ST ADD RMF 3 0 $4,000 EXTERIOR DECKS BLD04-00697 JAMES A & LORETTA C CLA 406 S GILBERT ST ADD RMF 3 0 $4,000 EXTERIOR DECKS Total ADD/RMF permits: 7 Total Valuation: $53,000 i BLD04-00883 PATRICK & JESSICA MOREl 720 MCLEAN ST ADD RSF 2 0 $340,000 ADDITION TO SFD BLD04-00924 JIM & PEGGY NUNNALLY 3330 MUSCATINE AVE ADD RSF 1 0 $15,400 16' x 16' room addition BLD04-00949 ELLEN OLTMANNS 826 BARR1NGTON RD ADD RSF 1 0 $12,000 Add third garage to S.F.D. BLD04-00960 TOM T & DANIELLE R LIN 202 N WESTMINSTER ST ADD RSF 1 0 $11,000 Install new tub and 12' x 14' uncovered deck BLD04-00928 SANDRA L PICKUP 818 3RD AVE ADD RSF 1 1 $4,500 8' x 14' Covered Deck Total ADD/RSF permits: 5 Total Valuation: $382,900 I BLD04-00882 SOUTHGATE DEV CO INC 1911 -1987 BROADWAY S'I ALT NON 1 0 $725,000 STORE FRONT RENOVATION FOR STRIP MALL BLD04-00936 OC GROUP LC 201 S CLiNTON ST 200 ALT NON 2 1 $300,000 ALTERATION OF MALL TENANT SPACE TO NEWSROOM BLD04-00662 OC GROUP LC 201 S CL1NTON ST ALT NON 2 0 $132,810 EXTERIOR WINDOWS FOR MALL FACADE BLD04-00959 RAYCAL IOWA LTD 100 HAWK RIDGE DR ALT NON 1 1 $15,000 ADD SPA TO EXIST1NG TENANT REC BUILDING Page: 3 City of Iowa City Date: 1/3/2005 Extraction of Building Permit Data for To: 12/1/2004 Census Bureau Report From: 12/31/2004 Type Type Permit Number Name Address lmpr Use Stories Units Valuation BLD04-00973 PRESBYTERY OF EAST IOW 1700 S 1ST AVE #23 ALT NON 2 1 $15,000 OFFICE REMODEL OF MALL TENANT SPACE BLD04-00961 OL1N L & FLORAINE LLOYD 1630 WILLOW CREEK DR ALT NON 1 0 $7,500 INTERIOR WALLS FOR TENANT FINISH OF CONTRACTOR SHOPS UNITS #1 & #2 BLD04-00957 DAWN'S HIDE AND BEAD A' 220 WASHINGTON ST ALT NON 3 0 $7,000 CHANGE OF USE AND ALTERATION FROM BAR TO MERCANTILE BLD04-00934 MERCY HOSPITAL 500 MARKET ST ALT NON 2 1 $4,000 PARTITION CLASSROOMS 2 & 3 ] Total ALT/NON permits: 8 Total Valuation: $1,206,31o BLD04-00976 SCOTT BARKER 621 S DODGE ST ALT RMF 2 0 $3,500 EXTERIOR STAIRS FOR RMF I Total ALT/RMF permits: 1 Total Valuation: $3,500 BLD04-00962 FRIENDS OF HISTORICAL Pi 925 WASHINGTON ST ALT RSF 2 1 $100,000 Interior remodel to bring S.F.D. to habitable condition BLD04-00939 RAY HENDRICKSON 228 BROWN ST ALT RSF 2 I $21,500 ADD BATHROOMS TO SFD BLD04-00979 JASON D HUNTER 927 ASPEN CT ALT RSF 1 0 $10,000 Basement finish BLD04-00917 MATTHEW J HAYEK 714 BROWN ST ALT RSF 1 0 $8,000 Convert two closets into a half bath BLD04-00955 DAVE & CORY BARNES 2374 KRISTIAN ST ALT RSF 1 0 $4,000 BASEMENT FINISH OF SFD BLD04-00975 ED GAINES 1821 B ST ALT RSF 0 0 $3,500 BASEMENT FINISH OF SFD BLD04-00978 GREG & LISA STEWART 1237 DEERFIELD DR ALT RSF 1 1 $2,500 FINISH BASEMENT ROOM IN SFD BLD04-00877 JAMES E & KIMBERLY A H5 3224 WASHINGTON ST ALT RSF 2 0 $2,000 Install five egress windows BLD04-00964 JIM BUXTON 402 E DAVENPORT ST ALT RSF 2 0 $1,100 Install basement bath BLD04-00950 KELLY O'BERRY 728 RUNDELL ST ALT RSF 1 0 $750 EGRESS WINDOW WELL BLD04-00968 DAN HAYS 501 S DODGE ST ALT RSF 2 1 $500 KITCHEN REMODEL FOR SFD I Total ALT/RSF permits: 11 Total Valuation: $153,850 BLD04-00822 HARTWIG OMS HOLDINGS ] 2814 NORTHGATE DR NEW NON 1 0 $724,423 MEDICAL OFFICE BUILDING BLD04-00832 CITY OF IOWA CITY 3900 HEBL AVENUE SW NEW NON 1 0 $15,800 SHED OVER METHANE GAS COLLECTION SYSTEM Page: 4 City of Iowa City Date: 1/3/2005 Extraction of Building Permit Data for To: 12/ /2004 Census Bureau Report From: 12/31/2004 Type Type Permit Number Name Address Impr Use Stories Units Valuation I Total NEW/NON permits: 2 Total Valuation: $740,223 I BLD04-00909 NICK CILEK 23 N LUCAS ST NEW RMF 2 3 $444,571 3 UNIT TOWNHOUSE DWELLING Total NEW/RMF permits: I Total Valuation: $444,571 i BLD04-00946 RUPP BUILDING 972 TAMARACK TRL NEW RSF 1 1 $330,000 S.F.D. with three car garage BLD04-00958 GARY FRAKES 62 WHITE OAK PL NEW RSF 1 1 $330,000 S.F.D. with two car garage BLD04-00873 SINAYA & DAVID NADLER 255 NORTH ST NEW RSF 2 1 $300,000 S.F.D. with three car garage BLD04-00912 CHANDLEE BUILDiNG 1050 PRAIRIE GRASS LN NEW RSF 2 1 $280,000 S.F.D. with three car garage BLD04-00923 DAV-ED LTD 3401 KEAP,_NEY LN NEW RSF 1 1 $230,000 S.F.D. with two car garage BLD04-00974 HLC COMPANY 3455 KILLARNEY RD NEW RSF 1 1 $230,000 SFD WITH ATTACHED 3 CAR GARAGE BLD04-00916 ARTISAN CUSTOM HOMES 1063 PRAIRIE GRASS LN NEW RSF 1 1 $220,000 S.F.D. with three car garage BLD04-00929 MICHAEL & ELLEN PAUL 3406 KEARNEY LN NEW RSF 1 1 $219,788 S.F.D. with three car garage BLD04-00925 KEV1N KIDWELL 1035 PRAIRIE GRASS LN NEW RSF 1 1 $210,000 S.F.D. with three car garage BLD04-00679 KD3 CONSTRUCTION 1140 WEEBER ST NEW RSF 2 1 $193,509 SFD WITH ATTACHED 2 CAR GARAGE BLD04-00945 SOUTHGATE DEVELOPMEN 102 LINDEMANN DR NEW RSF 1 1 $182,000 S.F.D. with two car garage BLD04-00931 OAKES DEV LTD 2006 BRISTOL DR NEW RSF 2 1 $180,000 S.F.D. with three car garage BLD04-00948 JASON WALTON 3414 KILLARNEY RD NEW RSF 1 1 $171,800 S.F.D. with two car garage BLD04-00921 PAUL & CHERYL STEWART 5 HUMMiNGBIRD LN NEW RSF 1 1 $167,940 S.F.D. with two car garage BLD04-00937 SOUTHGATE DEVELOPMEN 69 CHARLES DR NEW RSF 2 1 $167,600 S.F.D. with two car garage BLD04-00944 SOUTHGATE DEVELOPMEN 73 CHARLES DR NEW RSF 2 1 $161,600 S.F.D. with two car garage BLD04-00876 FRANTZ BUILDERS 1NC. 27 KEARNEY CT NEW RSF 2 1 $160,000 S.F.D. with three car garage BLD04-00947 HLC COMPANY 119 HUMMINGBIRD LN NEW RSF 1 1 $150,000 S.F.D. with three car garage BLD04-00891 ST ENTERPRISES LLC 1453 WETHERBY DR NEW RSF 1 1 $149,955 SFD WITH ATTACHED 3 CAR GARAGE P~ge: ~ City of Iowa City Date: 1/3/2005 Extraction of Building Permit Data for To: 12/1/2004 Census Bureau Report From: 12/31/2004 Type Type Permit Number Name Address Impr Use Stories Units Valuation I Total NEW/RSF permits: 19 Total Valuation: $4,034,192 I I 1 BLD04-00985 LARRY P WATERS 510 E BURLiNGTON ST REP MIX 3 0 $5,400 REROOF I Total REP/MIX permits: 1 Total Valuation: $5,400 BLD04-00941 MATTHEW & KELLY KELLI5 1641 WETHERBY DR REP RSF 1 1 $37,000 repair damage from garage fire BLD04-00969 CHUDACEK PRTNRSHP 204 N GILBERT ST REP RSF 2 1 $4,850 PORCH REPAIR OF SFD Total REP/RSF permits: 2 Total Valuation: $41,850 I GRAND TOTALS: PERMITS: 59 VALUATION: $7,364,1961 DRAFT MINUTES IOWA CITY BOARD OF APPEALS MONDAY, DECEMBER 6, 2004, LOBBY CONFERENCE ROOM IOWA CITY CITY HALL, 410 E. WASHINGTON STREET IOWA CITY,IA MEMBERS PRESENT: Steve Buckman, Wayne Maas, Anna Buss, Gary Haman Tim Fehr and Doug DuCharme John Roffman recused himself from meeting due to a conflict with the 735 Westgate appeals case. STAFF PRESENT: Tim Hennes (Sr. Building Inspector), Sue Dulek (Asst. City Attorney), Roger Jensen (Fire Marshall) and Jann Ream (Code Enforcement Asst. acting as minute taker) OTHERS PRESENT: Valerie Russell (735 Westgate Street) RECOMMENDATIONS TO COUNCIL: None CALL TO ORDER: Vice-chairperson Maas called the meeting to order at 4:15 P.M. CONSIDERATION OF MINUTES: Minutes from the July 12, 2004 meeting were discussed. Hennes stated that Vice-chairperson Maas would be signing the minutes since Chairperson Roffman was absent. MOTION: Haman moved to accept the minutes. Buss seconded. Motion passed unopposed. Appeal the decision of the Buildinq Official because: a. There are practical difficulties involved in carrying out the provisions of the code. (735 Westqate Street) Hennes stated that the property at 735 Westgate Street received a special exception to convert the single family dwelling to a commercial daycare center. As a change of use from residential to commercial, the property is required to meet current commercial building code standards. The property owner, Ms. Russell, hired an architect, Richard Kruse, to submit plans showing the required changes to the building so a building permit could be issued. A building permit was issued 11/8/2004. The existing interior stairs were built to residential standards and did not meet the required rise and run of commercial stairs so the architect designed compliant stairs that could be built into that space. Hennes said that Ms. Russell is now appealing the requirement to rebuild the stairs. Ms. Russell stated that the house was built 4 years ago and the stairs were compliant at that time for residential use. The stairs now would be only slightly non-compliant for commercial standards. They are one-half inch long on the rise and one inch short on the run. Replacing the stairs would be very costly and also would cause her to lose floor space in an upstairs room in order to create the DRAFT required headroom for the new stairs. She felt that having to go through the expense and loss of headroom was very impractical since the stairs were close to compliant and had a record of being safe. She stated that there had no accidents on those stairs since she moved in. She described the safety precautions she requires of the children when they go up and down the stairs and stated that the safety of the children is always her paramount concern. Buss asked if the stairs were uniform. Russell replied yes and Henries reiterated that the stairs comply with current residential standards. Hermes also wanted to inform the Board that John Roffman had recused himself from this appeal because he would be the contractor doing the work at this property. MOTION: DuCharme moved to grant the appeal based on the practical difficulties involved in carrying out the provisions of the code. Making the property owner go through the expense of installation and loss of floor space in order to install new stairs is impractical. The modification conforms with the intent and purpose of the code and such modification does not lessen health, accessibility, life and fire safety, or structural requirements. Buss seconded. DISCUSSION: Buckman stated that subsequent property owners might not be as conscientious about safety as the current owner and code requirements should apply to the property not the owner. Hennes reminded the property owner that all of the other items listed in the plan check notes of the building permit would be required. VOTE: The motion passed 5-1 with Buckman voting in the negative. OTHER BUSINESS: The next meeting was scheduled for January 10th' 2005 if there is an appeal. Hennes said that the Board would be working on the 2005 National Electrical code update in the next year. Roger Jensen reported that the Fire Department will be purchasing a fire sprinkling safety trailer in order to better educate the public and contractors as to the advantages of sprinkling. ADJOURNMENT: Buss moved to adjourn the meeting. Haman seconded. The meeting adjourned at 4:40 P.M. John Roffman, Board of Appeals Chair Date IP15 MrNUTES DRAFT PARKS AND RECREATION COMMISSION DECEMBER 8, 2004 MEMBERS PRESENT: Craig Gustaveson, Judith Klink, Margaret'Loomer, Ryan O'Leary, Nancy Ostrognai, Matthew Pacha, Sarah Walz, John Westefeld MEMBERS ABSENT: David Fleener STAFF PRESENT: Terry Trueblood, Mike Moran, Terry Robinson, Ann Burnside FORMAL ACTION TAKEN Moved by Pacha~ seconded by Westefeld~ to approve the November 10~ 2004 minutes as written. Unanimous. Moved by Gustaveson~ seconded by O'Lear% to recommend that the Parks and Recreation Commission endorse the concept of naming the dog park in recognition of a major contributor if such is a condition of their gift. Unanimous. Moved by Waiz~ seconded by Westefeld to recommend denial of the developer's request for the City to accept ownership of proposed parkland in the Village Green South Subdivision at this time~ given the fact that the Parks and Recreation Department does not have a sufficient amount of personnel to appropriately maintain the space. Passed 7-0 with one abstention. (O'Learv) Moved by Walz, seconded by Westefeld~ to elect Craig Gustaveson as Chair and Margaret Loomer as Vice Chair for 2005. Unanimous. DOG PARK NAMING Anne Burnside, DogPAC Board member, was present and reviewed the concept plan for the proposed Dog Park with the commission. In a letter to Steve Atkins, City Manager, Beth Shields suggested that DogPAC would proceed with its planned fundraising for the construction of the off-leash park with the understanding that a major contributor could possibly have naming privileges. It was suggested that this distinction could be considered, but that $25,000 probably is not a sufficient contribution for such. Pacha inquired about plans for obstacle courses for dogs etc. Burnside stated that the architect plan includes log piles, culverts, and a trail for the dogs and their owners, but not a specific obstacle course at this time. Pacha asked for a motion from the Commission to endorse the concept that if a large donor comes forward that they have the option to have their name as part of the parks name. O'Leary stated that he likes the idea of giving a donor this privilege, but indicated he did not agree with stating an actual dollar amount within the guidelines. Nancy Ostrognai asked that they keep Parks and Recreation Commission November 10, 2004 Page 2 of 5 "Dog Park" as part of the name. Trueblood suggested that sections of the park could be named after donors, or that rather than actually naming the park after a specific donor, recognition could be given with signage such as "This park made possible through the generous donations of...". Moved by Gustaveson, seconded by O'Leary, to recommend that the Parks and Recreation Commission endorse the concept of naming the dog park in recognition of a major contributor if such is a condition of their gift. Unanimous. VILLAGE GREEN SOUTH Trueblood reviewed the subdivision and its history. In 1993 the Commission recommended to conditionally accept approximately 12 acres of parkland, which is largely a storm water management area. There is now a new owner who would like to initiate a process for turning over the ownership to the City. Trueblood recommended to the Commission that they do not accept this proposal mainly due to the lack of personnel to maintain this property. Walz stated that neighborhoods need to understand what denying this request entails for them as homeowners. Gustaveson asked if we receive funds in lieu of accepting ownership. Trueblood stated this is uncertain at this time. If the City were to accept ownership of this property, the Commission agreed that the developer should be required to construct a hard surface trail to the City's specifications. Moved by Walz, seconded by Westefeld to recommend denial of the developer's request for the City to accept ownership of proposed parkland in the Village Green South Subdivision at this time, given the fact that the Parks and Recreation Department does not have a sufficient amount of personnel to appropriately maintain the space. Passed 7-0 with one abstention. (O'Leary) ELECTION OF OFFICERS FOR 2005 It was proposed by O'Leary to elect Craig Gustaveson as Chair and Judith Klink as Vice Chair for 2005. Klink declined the nomination and suggested that Margaret Loomer serve as Vice Chair for 2005. Moved by Walz, seconded by Westefeld, to elect Craig Gnstaveson as Chair and Margaret Loomer as Vice Chair for 2005. Unanimous. RECOGNITION OF OUTGOING MEMBER - NANCY OSTROGNAI Trueblood expressed gratitude to Ostrognai for her four years of service on the commission and noted her knowledge and experience of accessibility issues in regard to parks and buildings. Pacha presented her with a "Certificate of Appreciation", and Trueblood presented her with a few small gifts from the staff. COMMISSION TIME Ostrognai expressed her gratitude to the Commission for their work and inspiration over her four years of service. O'Leary stated that he is looking forward to the new year and the capital improvement projects that are proposed. He also stated that he hopes for more public Parks and Recreation Commission November 10, 2004 Page 3 of 5 participation. Walz thanked Nancy and Matt both for their contributions to the Commission over the years. She reiterated O'Leary's hope for more public input; also hopes that the Commission's denial of accepting ownership of the Village Green South property will make a statement to the public. Klink expressed her gratitude, as well, to Ostrognai and Pacha for their service and commitment to the Commission. She also expressed how impressed she is with John Yapp's Trail' Projects Update. Gustaveson also expressed gratitude for Ostrognai's and Pacha's contributions to the Commission and indicated he is looking forward to a productive year ahead. Loomer wished everyone Happy Holidays and her best wishes to Ostrognai. Westefeld stated that he has learned a lot from Nancy and will miss her and recognized Pacha for his longevity as chair. Also praised Parks and Recreation staff for the great party that was given to Marilyn Kriz at her retirement. DIRECTOR'S REPORT Trueblood reported on the following: Capital Improvement Projects Trueblood reviewed City Manager's tentative proposed budget and how it effects Parks & Recreation CIP projects. He presented a modified list to the Commission that was adopted at the November meeting. Items asterisked are the items City Manager is recommending to City Council. Trueblood reviewed those items and the changes are as follows: Peninsula Parkland Entry Road & Parking Lot Project: Approved for this year. Trueblood reminded the Commission that we are currently in FY '05 and that FY '06 begins July 1, 2005. Grant Wood Community Gymnasium Project: Recommended for FY '06. Mercer Park Ballfield Upgrade: City Manager is proposing $300,000 over a three-year period rather than $280,000 requested in one year. Iowa River Trail Bridge: This project is not recommended for funding by the City Manager at this time for budgeting reasons, but Trueblood noted that City Manager does like this proposal. Sand Lake Recreation Acquisition: City Managers budget includes $200,000 per year over three years instead of the $750,000 in one year. Idea is to start setting aside funds for something if it does come to fruition. Soccer Park Improvements: Recommended $100,000 for FY '06. Waterworks Prairie Park Development: Recommended for FY '06. Replace 10 Park Shelters: Recommended for FY '06. Trueblood added some items. The City Park Riverbank Stabilization will be recommended if federal funding can be obtained. Annual park maintenance projects proposed for $200,000. Am~ual Intra-City Bike Trail Project, $30,000 still in. Missing Link Trail in current budget. Parks and Recreation Commission November 10, 2004 Page 4 of 5 The Recreation Center window replacement project that was approved last year to be done over a three-year period has not begun. This is due to the resignation of an engineer. There has recently been a new engineer assigned to this project so should be moving ahead with this in 2005. Gustaveson asked if we could recommend a change in prioritization of this list to the City Manager. Trueblood reminded Commission that they approved this list at the November meeting. Trueblood stated that having six of top seven projects approved (either in whole or part) is quite good. Public Art Trueblood reviewed memo that was sent to Public Art Committee regarding the placement of art in city parks and which parks would be considered as most appropriate for this. The top five parks listed are City Park (upper portion), Hunters Run Park, Iowa City Kickers Soccer Park, South Sycamore Greenway, and Willow Creek Park. Also listed were several other parks that may be considered. United Action for Youth "Drag Show" Reviewed printed materials with Commission regarding the GLBTQ&A Youth Drag Talent Show sponsored by the United Action for Youth. No comments or discussion. Board & Commission Meeting The tentative date is January 10 for Boards and Commissions to meet with City Council. Aquatics Supervisor Position Update Offered position to candidate from Maine. This candidate rejected the offer. Will be offering position to second candidate on Thursday, December 9. CHAIR'S REPORT Pacha reminded Commission that new member, Philip Reisetter, will begin his term in January. Pacha thanked Nancy for her comments, contribution and her efforts to attend the meetings and park tours. Pacha also thanked the incoming officers, and wished all present Happy Holidays. ADJOURNMENT The meeting adjourned at 6:10 p.m. Parks and Recreation Commission November 10, 2004 Page 5 of 5 PARKS AND RECREATION COMMISSION ATTENDANCE RECORD YEAR 2004 TERM NAME EXPIRES 1/14 2/11 3/10 4/13 5/12 6/9 7/14 8/11 9/8 10/13 11/10 12/8 Kevin Boyd 1/1/06 X ................................. David Fleener 1/1/08 X X X LQ X O/E NM X O/E NM O/E OE. Craig Gustaveson 1/1/07 X X X LQ X X NM X X NM X X Judith Klink 1/1/07 X O/E X LQ X X ~ X X NM X X Margaret Loomer 1/1/08 X X X LQ X O/E NM X X NM X X Ryan O'Leary 1/1/06 ......... LQ X X NM X X NM X X Nancy Ostrognai 1/1/05 X X X LQ X X NM X X NM X X Matt Pacha 1/1/05 X X X LQ X O/E NM O/E X NM X X Sarah Walz 1/1/07 X X X LQ X X NM O/E X NM X X John Westefeld 1/1/06 X X X LQ X X NM X X NM X X KEY: X = Present O = Absent O/E = Absent/Excused NM = No meeting LQ = No meeting due to lack of quorum .... Not a Member Minutes DRAFT ~ Iowa City Airport Commission December 9, 2004 Iowa City Airport Terminal Members Present: Randy Hartwig, John Staley, Dan Clay, Carl Williams, Michelle Robnett Members Absent: None Staff Present: Sue Dulek, Jeff Davidson Others Present: David Hughes, Harry Wolf, Dean Thomberry, Jay Hoenck, Rick Mascari, Dennis Gordon Call to Order: The meeting was called to order at 5:50 PM Recommendations to Council: None Approval of Minutes: Mr. Williams moved and Mr. Clay seconded motion to accept minutes from November meeting. Motion carried 3-0 with Staley and Robnett being absent. Ms. Robnett arrived. Public Discussion - Items not on the Agenda: Mr. Thomberry addressed the Commission to present information about the Air Lift LifeLine Pilots organization and to request permission to post information on the Terminal bulletin board. Unfinished Items for Discussion / Action: None Items for Discussion / Action: A. Runway 7/25 Project - Earth Tech: Mr. Hughes presented some preliminary information pertaining to the options available on the width of the runway extension. B. A.I.P Grant - Mr. Hughes presented the completed A.I.P. pre-application that was filed with the DOT in November. Mr. Hughes went over the projects the Commission and FAA foresee for the next five year period and longer range. Specifically, near term is continuing the 7/25 extension project. Additionally, the need to upgrade the north hanger taxi way was agreed. C. Aviation Commerce Park - Mr. Wolf from lowa Realty was present and indicated there should be one "serious" offer for the Commission to consider before or by the next Commission meeting. Mr. Williams asked if there was a written offer on lot/lots. Mr. Wolf responded that there is a document that has not been signed by either party but that we are very close to a verbal agreement and that both parties are in agreement with the economics and are looking into applicable covenants. Mr. Mascari asked if Iowa Realty were doing any advertising of the property. Mr. Wolf indicated that whereas the listings had been made inactive pending the resolution of the current sale under discussion, there is not any active marketing. If the sale currently under discussion should go through there may be a need to re- examine the pricing, and land use of the remaining lots. Mr. Mascari told the Commission that every year that passes costs the Commission $80,000 in lost benefits and urged the Commission to be aggressive in marketing the land. Mr. Staley arrived. D. Strategic Plan - Mr. Davidson had a first draft of the Commission's Strategic Plan which the Commission went over in detail to correct / amend facts and agree on specific wording. E. Airport Budget - Commission reviewed budget and how year to date figures compare to budgeted amounts. Specific accounts were questioned to find out specific information about. F. Airport Management - There was a resolution to extend the contract with Snyder & Associates. Moved by Mr. Staley, seconded by Mr. Clay. Resolution passed 5-0 on a roll call vote. Mr. Clay discussed the possible use of a student intern and the discussion with University of Dubuque on duties and responsibilities. The issue of moving the Airport Manager's office to terminal in conjunction with the possible internships was also discussed. The Commission authorized Mr. Clay to interview applicants. G. Obstruction Mitigation Project / Stanley Consultants - Mr. Hartwig discussed some of the trees (obstructions) that are in the process of being mitigated. H. Airport Park - Mr. Hartwig discussed the reply from the FAA concerning what is needed to proceed with installing a terminal viewing area. It may be desirable to include these tasks in with other grant applicahons. The availability of a DOT grant for security items will be explored. Chairperson's Report: The Chair asked members to consider any personal goals for the upcoming year and present at January's meeting. Commission Members Reports: There were none. Administrative Report: None Set Next Meeting: Next meeting set for January 13, 2005 Adjournment: Meeting adjourned at 8:45PM MINUTES DRAF2' IOWA CITY TELECOMMUNICATIONS COMMISSION MONDAY, DECEMBER 20, 2004 5:30 P.M. CITY CABLE TV OFFICE, 10 S. LINN ST.-TOWER PLACE PARKING FACILITY MEMBERS PRESENT: Jim Pusack, Terry Smith, Saul Mekies, Brett Castillo, Kimberly Thrower MEMBERS ABSENT: STAFF PRESENT: Drew Shaffer, Mike Brau, Bob Hardy, Dale Helling, Andy Matthews OTHERS PRESENT: Kevin Hoyland, Michael McBride, Susan Rogusky, Jon Koebrick, Phil Phillips RECOMMENDATIONS TO CITY COUNCIL None at this time. SUMMARY OF DISCUSSION Koebrick reported that the Video on Demand (VOD) service is being rolled out and has been very successful where it is available. A subscription VOD for the Starz channel is available and one for HBO will be available soon. Digital Video Recorders are now available and the demand for them is nearly outpacing their supply. Michael McBride reported the University of Iowa channel is currently sharing a channel allocation with the school district in Cedar Rapids and some of their programs are unavailable in Cedar Rapids. As a result, the University has started using programming blocks with more replays and setting specific days and times for some programs. Phil Phillips reported that PATV will be closed from 7 p.m. 12/23/04 until 12 p.m. 1/3/05. The following people were elected to the PATV Board of Directors: Jack Fuller, Chair; Brett Gordon, Vice-Chair; Holly Berkowitz, Secretary; and Steve Newell, Treasurer. Hardy reported that the video on demand (VOD) service is up and running on InfoVision channel 5 and offers City Council meetings and the Avatar Project. A new program schedule strategy for channel 4 is planned in which public affairs programming will be on Tuesday and Thursday and conununity programming will be on Monday, Wednesday, and Friday. Shaffer reported that the Avatar program was cablecast live on December 13. A shorter version will be cablecast every Monday at 7 p.m. These other Monday Avatar programs will not be live. The channel 4 program guidelines are being rewritten to accommodate underwriting and sponsorship of programs. Pusack also said that during the City Council meetings that Councilors often mention the work accomplished at the informal sessions and suggested that the Council be asked if they would permit the informal sessions to be cablecast. The sessions may be well suited to the video on demand service. Helling said that issue comes up periodically and that he will mention the Commission's interest to the mayor. Shaffer said there just a couple of issues remaining regarding the refranchising process. Modification to language regarding the City's ability to use music licensed by ASCAP/BMI is being developed. Clarification of the ability and costs of additional local origination sites is also being worked on. Mediacom has provided the access channel signal test data. The existing franchise and ordinance are being reviewed to update any non-substantive language that is out of date. The length of the franchise term has yet to be determined. The Commission voted unanimously to plan for a public hearing on the new franchise. APPROVAL OF M1NUTES Castillo moved and Mekies seconded a motion to approve meeting minutes of October 25, 2004. The motion passed unanimously. ANNOUNCEMENTS OF COMMISSIONERS None. SHORT PUBLIC 'ANNOUNCEMENTS None. CONSUMER ISSUES Shaffer referred to the complaint reports included in the packet and noted that there were 14 complaints in the last 2 months. This is an average number of complaints per month and is a comparatively low number. Among the complaints were 1 about wanting to receive a receipt after payment, 1 requesting a la carte programming, 1 about "pornographic" programming on the basic tier, 2 that CNBC should not have been moved to the expanded basic tier, 2 that CNBC was moved without notification, 1 about a general dissatisfaction with Mediacom, 1 wanting to be able pay over the Internet, 1 that subscriber's current payment balance is not available on the Internet, 1 about a program on channel 4, 1 about a billing problem, and 1 that there was no notification that an outage was to occur. All the complaints that could be resolved have been. MEDIACOM REPORT Koebrick reported that the Video on Demand (VOD) service is being rolled out and has been very successful where it is available. A subscription VOD for the Starz channel is available and one for HBO will be available soon. This has been a very popular service. Digital Video Recorders are now available and the demand for them is nearly outpacing their supply. Castillo said that on occasion he has had a connection failure when ordering a VOD program. Koebrick said he will look into the problem. UNIVERSITY OF IOWA REPORT Michael McBride reported the University of Iowa channel is currently sharing a channel allocation with the school district in Cedar Rapids and some of their programs are unavailable in Cedar Rapids. As a result, the University has started using programming blocks with more replays and setting specific days and times for some programs. PATVREPORT Phil Phillips reported that the annual report is expected to be available for the next Commission meeting. PATV will be closed from 7 p.m. 12/23/04 until 12 p.m. 1/3/05. The following people were elected to the PATV Board of Directors: Jack Fuller, Chair; Brett Gordon, Vice-Chair; Holly Berkowitz, Secretary; and Steve Newell, Treasurer. SENIOR CENTER REPORT Rogusky reported that SCTV had two live programs appear on InfoVision Channel Five, which originated from the Senior Center last month. IOWA CITY COMMUNITY SCHOOL DISTRICT REPORT Hoyland reported that the schools have had some complaints that the sound was a problem during the school board meetings and that he is looking into solutions. Koebrick will be contacting Hoyland to check on signal quality coming from channel 21. LEGAL REPORT Matthews said he had nothing new to report. L1BRARY REPORT No representative was present. KIRKWOOD REPORT No representative was present. MEDIA UNIT Hardy reported that productions are down, as expected, during the Holiday season. The Community Television Service has programs planned that are sponsored by the Iowa City Bicycle Project, the Johnson County Council on Aging, the Emma Goldman Clinic, and an AARP State Senator Forum. The video on demand (VOD) service is up and running on InfoVision channel 5 and offers City Council meetings and the Avatar Project. Promotion of the VOD service will begin in January. A new program schedule strategy for channel 4 is planned in which public affairs programming will be on Tuesday and Thursday and community programming will be on Monday, Wednesday, and Friday. CABLE TV ADMINISTRATOR REPORT Shaffer reported that the Avatar program was cablecast live on December 13. A shorter version will be cablecast on Monday at 7 p.m. The channel 4 program guidelines are being rewritten to accommodate underwriting and sponsorship of programs. Pusack said that the quality of the school board meetings on channel 21 could be better, particularly the audio. Pusack said that if better equipment is needed for an improvement and the school district cannot fund improvements that there might be a way for the Commission to fund improvements through the pass-through fee. Pusack also said that during the City Council meetings that Councilors often mention the work accomplished at the informal sessions and suggested that the Council be asked if they would permit them to be cablecast. The sessions may be well suited to the video on demand service on InfoVision Channel 5. Helling said that issue comes up periodically and that he will mention the Commission's interest to the mayor. REFRANCHIS1NG Shaffer said there just a couple of issues remaining concerning refranchising negotiations. Modification to language regarding the City's ability to use music licensed by ASCAP/BMI is being developed. Clarification of the ability and costs of additional local origination sites is also being worked on. Mediacom has provided the access channel signal test data. The existing franchise and ordinance are being reviewed to update any non-substantive language that is out of date. The length of the franchise term has yet to be determined. The Commission voted unanimously to plan for a public hearing on the new franchise. SET DATE FOR PUBLIC HEARING REGARDING EXTENSION OF FRANCHISE BETWEEN MEDIACOM AND THE CITY OF IOWA CITY. Shaffer said the final franchise documents need to be finalized a least one week prior to any public hearing. Smith said the Commission should discuss the final documents prior to a public hearing. It may be possible to hold the public hearing at the regular February Commission meeting. If that is done, it should be the only item on the agenda. Shaffer said that in addition to the required posting for the public hearing an ad would likely be placed in the newspaper and a press release issued. Smith suggested that the Commission discuss the franchise and ordinance at their January meeting if they are complete and defer discussion to the February meeting if they are not. If the public hearing is held in February it should be held in the Council Chambers at the time of the regular Commission meeting. If the Council Chambers are not available, then the library and Senior Center are tow other possible venues. ADJOURNMENT Pusack moved and Thrower moved to adjourn. The motion passed unanimously. Adjournment was at 6:18 p.m. Respectfully submitted, Drew Shaffer Cable TV Administrator TELECOMMUNICATIONS COMMISSION 12 MONTH ATTENDANCE RECORD 01/01/03 to CURRENT Meeting Date Kimberly Saul Meikes Brett Castillo Terry Smith Jim Pusack Thrower 6/2/03 x x x x x 7/28/03 x x x x x 8/25/03 x x x x o/c 9/22/03 x x x x o/c 10/27/03 x x x x o/c 11/24/03 x x o/c x x 12/15/03 o/c o/c x x x 1/2/04 x o/c x x x 1/26/04 x x x x x 2/23/04 x o/c x o/c x 3/22/04 x x x x x 4/26/04 x x x x O/C 5/24/04 x x O/C x x 6/28/04 x x x o/c x 7/26/04 o/c x x x x 8/26/04 did not meet did not meet did not meet did not meet did not meet 9/27/04 X X X X X 10/25/04 X X 11/04 Did not meet Did not meet Did not meet Did not meet Did not meet X X X X X 12/20/04 (X) = Present (0) = Absent (O/C) = Absent/Called (Excused) EideBailly, CPAs & BUSINESS ADVISORS To the Honorable Mayor and Members of the City Council City of Iowa City, Iowa We have audited the financial statements of the City of Iowa City, Iowa, for the year ended June 30, 2004, and have issued our report thereon dated November 15, 2004. Professional standards require that we provide you with the following information related to our audit. Our Responsibility under Auditing Standards Generally Accepted in the United States of America and OMB Circular A-133 As stated in our engagement letter dated August 6, 2003, our responsibility, as described by professional standards, is to plan and perform our audit to obtain reasonable, but not absolute, assurance about whether the financial statements are free of material misstatement and are fairly presented in accordance with accounting principles generally accepted in the United States of America. Because an audit is designed to provide reasonable, but not absolute, assurance and because we did not perform a detailed examination of all transactions, there is a risk that material misstatements may exist and not be detected by us. In planning and performing our audit, we considered the City's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinions on the financial statements and not to provide assurance on the internal control over financial reporting. We also considered internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133. As part of obtaining reasonable assurance about whether the City's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit. Also, in accordance with OMB Circular A-133, we examined, on a test basis, evidence about the City's compliance with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement applicable to each of its major federal programs for the purpose of expressing an opinion on the City's compliance with those requirements. While our audit provides a reasonable basis for our opinion, it does not provide a legal determination on the City's compliance with those requirements. PEOPLE. PRINCIPLES. POSSIBILITIES. www.eidebailly.com 3999 Pennsylvania Ave., Suite 100 ! Dubuque, Iowa 52002-2639 ! Phone 563.556.1790 1 Fax 563557.7842 I EOE To the Honorable Mayor and Members of the City Council City of Iowa City, Iowa Page 2 Significant Accounting Policies Management is responsible for the selection and use of appropriate accounting policies. In accordance with the terms of our engagement letter, we will advise management about the appropriateness of accounting policies and their application. The significant accounting policies used by the City of Iowa City, Iowa, are described in Note 1 to the financial statements. For the year ended June 30, 2004, the City adopted Governmental Accounting Standards Statement No. 39, Determining Whether Certain Organizations are Component Units. Statement No. 39 provides guidance to determine whether certain organizations for which the City is not financially accountable should be reported as component units based on the nature and significance of their relationship with the City. Generally, it requires reporting, as a component unit, an organization that raises and holds economic resources for the direct benefit of a governmental urdt. Under the provisions of this standard, the City has determined it is proper not to report any component units. We noted no transactions entered into by the City during the year that were both significant and unusual, and of which, under professional standards, we are required to inform you, or transactions for which there is a lack of authoritative guidance or consensus. Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. Audit Adjustments For purposes of this letter, professional standards define an audit adjustment as a proposed correction of the financial statements that, in our judgment, may not have been detected except through our auditing procedures. An audit adjustment may or may not indicate matters that could have a significant effect on the City's financial reporting process (that is, cause future financial statements to be materially misstated). Due to the conversion to new financial accounting software during the year, audit adjustments were recorded in the areas of capital assets, debt, and net assets. In our judgment those adjustments indicate matters that have a significant effect on the City's financial reporting process. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter that could be significant to the financial statements or the auditor's report. We are pleased to report that no such disagreements arose during the course of our audit. To the Honorable Mayor and Members of the City Council City of Iowa City, Iowa Page 3 Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the City's financial statements or a determination of the type of auditor's opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Issues Discussed Prior to Retention of Independent Auditors We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Other Comments We have included additional comments regarding financial reporting. These comments are not a result of in-depth study of any specific areas but are based on observations made during the course of our audit. This report, a public record by law, is intended solely for the information and use of the officials, employees, and citizens of the City of Iowa City, Iowa, and other parties to whom the City of Iowa City, Iowa, may report. This report is not intended to be and should not be used by anyone other than these specified parties. As always, we will be happy to discuss these or any other topics at your convenience. We would like to take this opportunity to express our appreciation to you and your staff for the fine cooperation that we received during the course of the audit. We look forward to many years of continued service to the City of Iowa City, lowa. Dubuque, Iowa November 15, 2004 CITY OF IOWA CITY, IOWA YEAR ENDED JUNE 30, 2004 OTHER COMMENTS NEW GOVERNMENTAL ACCOUNTING STANDARDS BOARD (GASB) STANDARDS The Governmental Accounting Standards Board (GASB) has issued five statements not yet implemented by the City of Iowa City. The statements, which might impact the City of Iowa City are as follows: Statement No. 40, Deposit and Investment Risk Disclosures issued March 2003, will be effective for the City for the fiscal year ending June 30, 2005. This statement addresses common deposit and investment risks related to credit risk, concentration of credit risk, interest rate risk, and foreign currency risk. Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries issued November 2003, will be effective for the City for the fiscal year ending June 30, 2006. This statement establishes accounting and financial reporting standards for impairment of capital assets and also clarifies and establishes accounting requirements for insurance recoveries. Statement No. 43, Financial Reporting for Postemployment Benefit Plans Other than Pension Plans issued April 2004, will be effective for the City for the fiscal year ending June 30, 2008. This statement establishes uniform financial reporting standards for other postemployment benefit (OPEB) plans and supersedes the interim guidance included in Statement No. 26. This statement affects reporting by administrators or trustees of OPEB plan assets or by employers or sponsors that include OPEB plan assets as trust or agency funds in their financial reports. Statement No. 44, Economic Condition Reporting: The Statistical Section issued May 2004, will be effective for the City for the fiscal year ending June 30, 2006. This statement amends previous guidance regarding preparation of the statistical section for governments that issue a comprehensive annual financial report. Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions issued June 2004, will be effective for the City for the fiscal year ending June 30, 2009. This statement establishes standards for the measurement, recognition, and display of (OPEB) expense/expenditures and related liabilities (assets), note disclosures and, if applicable, required supplementary information (RSI) in the financial reports of state and local governmental employers. The City's management has not yet determined the effect these statements will have on the City's financial statements. COMPREHENSIVE ANNUAL FINANCIAL REPORT CITY OF IOWA CITY, IOWA FOR THE FISCAL YEAR ENDED JUNE 30, 2004 PREPARED BY: DEPARTMENT OF FINANCE CITY OF 1OWA CITY, 1OWA CITY OF IOWA CITY, IOWA TABLE OF CONTENTS June 30, 2004 Page INTRODUCTORY SECTION Table of contents ................................................................................................................................ 1 Letter of transmittal ............................................................................................................................ 3 City organizational chart .................................................................................................................... 10 Officials .............................................................................................................................................. 11 Certificate of Achievement for Excellence in Financial Reporting ................................................... 12 FINANCIAL SECTION INDEPENDENT AUDITOR'S REPORT ......................................................................................... 13 MANAGEMENT'S DISCUSSION AND ANALYSIS ..................................................................... 15 BASIC FINANCIAL STATEMENTS Government-wide financial statements Statement of net assets ................................................................................................................. 26 Statement of activities .................................................................................................................. 28 Fund financial statements Balance sheet - governmental funds ............................................................................................ 30 Reconciliation of the balance sheet of the governmental funds to the statement of net assets .... 32 Statement of revenues, expenditures, and changes in fund balances - govcwnmental funds ........ 33 Reconciliation of the statement of revenues, expenditures, and changes in fund balances of governmental funds to the statement of activities ..................................................................... 35 Statement of revenues, expenditures, and changes in fund balances - budget and actual (budgetary basis) General fired ........................................................................................................................... 36 Employee benefits fund .......................................................................................................... 39 Statement of net assets - proprietary funds .................................................................................. 40 Statement of revenues, expenses, and changes in fund net assets - proprietary funds ................ 43 Statement of cash flows - proprietary funds ................................................................................ 44 Statement of fiduciary assets and liabilities ................................................................................. 46 Notes to financial statements ........................................................................................................... 47 COMBINING AND INDIVIDUAL FUND STATEMENTS Combining balance sheet - nonmajor governmental funds ............................................................. 74 Combining statement of revenues, expenditures, and changes in fund balances - nonmajor governmental funds ...................................................................................................................... 75 Combining statement of net assets - nonmajor enterprise funds .................................................... 78 Combining statement of revenues, expenses, and changes in fund net assets - nonmajor enterprise funds ............................................................................................................................ 79 Combining statement of cash flows - nonmajor enterprise funds ................................................... 80 Combining statement of net assets - internal service funds ............................................................ 82 Combining statement of revenues, expenses, and changes in fund net assets - internal service funds ............................................................................................................................................. 83 Combining statement of cash flows - internal service funds .......................................................... 84 Combining statement of changes in assets and liabilities - agency funds ...................................... 86 CITY OF IOWA CITY, IOWA TABLE OF CONTENTS June 30, 2004 Page STATISTICAL SECTION (UNAUDITED) Government-wide expenses by function ............................................................................................ 89 90 Government-wide revenues ................................................................................................................ General governmental expenditures by function and transfers to other funds ................................... 92 General governmental revenues by source and transfers from other funds ....................................... 94 96 Property tax budgets and collections .................................................................................................. 97 Property tax rates and tax dollars budgeted ........................................................................................ Property tax, road use tax, and hotel/motel tax revenues ................................................................... 98 Assessed and estimated actual value of taxable property and exempt property ................................. 99 Property tax rates - all direct and overlapping governments ............................................................. 100 101 Principal taxpayers and employers ..................................................................................................... 102 Special assessment collections ........................................................................................................... Ratio of net general obligation bonded debt to assessed value and net bonded debt per capita ........ 103 Ratio of annual debt service expenditures for general bonded debt to total general governmental 104 expenditures .................................................................................................................................... Computation of direct and overlapping debt ...................................................................................... 105 106 Schedule of revenue bond coverage ................................................................................................... 107 Demographic statistics ....................................................................................................................... Property value, building permits, and bank deposits .......................................................................... 108 110 Parking rates ....................................................................................................................................... Schedule of liability and property insurance in force ......................................................................... 111 Miscellaneous statistical data ............................................................................................................. 112 COMPLIANCE SECTION Report on compliance and on internal control over financial reporting based on an audit of financial statements performed in accordance with Government Auditing Standards .................... 115 Report on compliance with requirements applicable to each major program and internal control over compliance in accordance with OMB Circular A-133 ................................................ 117 Schedule of expenditures of federal awards ....................................................................................... 119 Notes to the schedule of expenditures of federal awards ................................................................... 121 Schedule of findings and questioned costs ......................................................................................... 122 CITY OF I0 WA CITY November 15, 2004 To the Citizens, Honorable Mayor, Members of the City Council and City Manager City of Iowa City, Iowa The Comprehensive Annual Financial Report (CAFR) of the City of Iowa City, Iowa (the City) for the fiscal year ended June 30, 2004 is submitted herewith in accordance with the provisions of Chapter 11 of the Code of Iowa. The City's Finance Department prepared this report. Responsibility for both the accuracy of the data presented and the completeness and fairness of the presentation, including all disclosures, rest with the City. I believe the information, as presented, is accurate in all material respects and presented in a manner designed to fairly present the financial position and results of operations of the City. All disclosures necessary to enable the reader to gain an understanding of the City's financial affairs have been included. This report consists of management's representation concerning the finances of the City of Iowa City. Management assumes full responsibility for the completeness and reliability of all of the information presented in this report. To provide a reasonable basis for making these representations, management of the City has established a comprehensive internal control framework that is designed both to protect the govemment's assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City's financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Because the cost of intemal controls should not outweigh their benefits, the City's comprehensive framework of intemal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The CAFR reflects all funds of the City in accordance with standards set by the Governmental Accounting Standards Board (GASB). In 1999, GASB adopted Statement No. 34, Basic Financial Statements - Management's Discussion and Analysis - For State and Local Governments. The final effective date for the implementation of GASB No. 34 for the City of Iowa City was June 30, 2003. This report complies with those standards. This statement significantly changes governmental financial reporting in order to bring it closer to a private sector model. To facilitate an understanding of the City's financial affairs, this report is organized into four sections: introductory, financial, statistical and compliance. The introductory section contains the table of contents, listing of City officials, an organizational chart and this letter of transmittal. The financial section contains the independent auditors' report, management's discussion and analysis, the basic financial statements, required supplementary information, and other supplementary information. The statistical section contains comprehensive statistical data that is intended to provide a broader and more complete understanding of the financial and economic trends of the City. The City is required to undergo an annual single audit in conformity with the provisions of the Single Audit Act of 1996 and the U.S. Office of Management and Budget (OMB) Circular A-133, Audits of State andLocal Governments. Information related to this single audit, including the schedules of federal financial assistance, findings and questioned costs, and independent auditors' reports on the internal accounting and administrative controls and compliance with applicable laws and regulations, are included in the compliance section of this report. GAAP require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City's MD&A can be found immediately following the report of the independent auditors. The City of Iowa City's financial statements have been audited by Eide Bailly, LLP of Dubuque, Iowa, a firm of licensed certified public accountants. The goal of the independent audit was to provide reasonable assurance that the City's financial statements for the fiscal year ended, June 30, 2004 are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement preparation. The independent auditor concluded, based upon the audit, that there was a reasonable basis for rendering an unqualified opinion that the City of Iowa City's financial statements for the fiscal year ended, June 30, 2004, are fairly presented in conformity with GAAP. Profile of the Government The City of Iowa City was incorporated April 6, 1853. The City is governed by a seven member Council; each member serves a four-year tenn. Elections are held every two years allowing for continuation in office of at least three members at each biennial election. The Council members are elected at large, but three members are nominated from specific districts, and the four other members are nominated at large. The Council elects the Mayor from its own members for a two-year term. The City Council is the legislative body and makes all policy determinations for the City through the enactment of ordinances and resolutions. It also adopts a budget to determine how the City will obtain and spend its funds. The Council appoints members of boards, commissions and committees. The City Manager is the chief administrative officer for the City and is appointed by the City Council. The City Manager implements policy decisions of the City Council and enforces City ordinances. In addition, the City Manager appoints and directly supervises the directors of the City's operating depmlss~ents and supervises the administration of the City's personnel system. He supervises 532 full-time and 88 permanent part-time municipal employees and 706 temporary employees including a police force of 71 sworn personnel and a fire department of 56 firefighters. The City owns and operates its water supply and distribution system and sewage collection and treatment system with secondary treatment also provided. Virtually the entire City has separate storm and sanitary sewer systems. The City operates a municipal off- street and on-street parking system in the downtown area. Since 1971, the City has operated a transit system. The annual budget serves as the foundation for the City's financial planning and control. All departments of the City are required to submit requests for appropriation to the City Manager in October. The City Manager uses these requests as the starting point for developing a proposed budget. The City Manager then presents this proposed budget to the Council for review in December. The Council is required to hold a public hearing on the proposed budget and to adopt a final budget no later than March 15. The appropriated budget is prepared by fund, fimction (e.g., Public Safety), and department (e.g., Police). The City adopts a three-year financial plan that includes both operations and capital improvements. This three-year plan permits a more comprehensive review of the City's financial condition, allowing analysis of the current and 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. The state requires at least a one-year operating budget. While legal spending control is exercised at a state mandated function level, management control is set at the Department Manager level. Encumbrance accounting is utilized in all funds for budgetary control. Encumbrances outstanding at year-end for the governmental fund types are reflected as reservations of the fund balances. Appropriations that are not encumbered lapse at the end of the year. Economic Condition and Outlook The City's economic strength is based upon education, medical services, and diversified manufacturing. The University of Iowa is the City's largest employer with over 23,500 employees and the University of Iowa Hospitals and Clinics is the largest university-owned teaching medical center in the United States. The City also has a significant number of private employers who have a history of providing stable and increasing employment in the community. The relative stability of the University of Iowa, coupled with the City's multi-sector base of industrial and commercial interests, will continue to help insulate the City from the significant negative economic impacts related to unemployment. The City continues to see sustained production in our major local industries, such as ACT, Proctor & Gamble, and Pearson. Continued economic development efforts involving the Iowa City and Coralville Chambers of Commerce, local private interests, the University of Iowa and other surrounding communities through participation as members of the Iowa City Area Development Group, have proved positive with the retention and expansion of businesses. In addition, the corridor between Iowa City and Cedar Rapids has been identified as one of the major growth areas for new business development in the State of Iowa. Continued developments within Iowa City and the region have a favorable impact upon the City's economy. Currently there are budget challenges facing the State of Iowa, however, the City's economy as a whole continues to grow. The major employers have been able to maintain their workforce size. The unemployment rate for Johnson County continues to remain low at between 3.2% and 4.0%. The City has consistently experienced modest increases in assessed property valuations. New housing construction continues to be relatively strong with 193 new single-family houses and 485 multi-family units added to the tax rolls for the year ended December 31, 2003. This, along with the low unemployment rate, continues to be indicative of the City's economic well being. The 2000 census population of Iowa City was 62,220. After further review by the United Census Bureau, the population was revised to 62,380 in 2002. This represents a 4.42% increase over the 1990 population of 59,738. In preparing the financial plan for the three years ending June 30, 2007, the process of budget balancing has again been most difficult. With the continued tax limitations imposed by the state (specifically the residential rollback factor) and other federal and state regulations and mandates, the municipal service needs for our growing community are becoming increasingly difficult to satisfy. In balancing the budget for the three-year period, the City attempted to maintain service levels, wherever practical. In addition, our planning has been directed at maintaining our current fiscal strength and avoiding any erosion of that fiscal position, including the City's Aaa bond rating. A continuing major objective in the three-year £mancial plan is to maintain or increase the City's cash reserve position. In addition, procedures were adopted to allocate unreserved fund balances between the contingency and undesignated fund balances. The contingency fund is available during the fiscal year for unanticipated and unbudgeted expenditures, while the undesignated fund balance is intended to be maintained as working capital. The City is committed to drawing from the undesignated fund balance only in emergency situations. This unreserved fund balance allocation along with specific budgeting techniques has allowed the City to increase or maintain fund balances over the past year. The City continues to pursue cooperative efforts with other local governments. Joint funding, purchasing, planning and other efforts allow the City to meet mandates for new and improved services in the future at the most reasonable cost. Joint cooperation currently encompasses regional transportation planning, human services, solid waste management planning, a hazardous materials response program, an enhanced 911 emergency communications system, community relations, joint operation of an animal control facility, joint operation of an indoor swimming pool facility, and joint economic development efforts. While such cooperative efforts are not new in concept, the City expects to enter into more agreements with neighboring governmental subdivisions, as well as with the University of Iowa. There are many signs that the City remains healthy and vibrant with great promise for the future. The University of Iowa continues to add new buildings and facilities. The City continues to see sustained production in major local industries. Industrial and commercial interests within the community have continued to thrive. The City will be challenged during the next couple of years to maintain its vitality through greater economic development efforts, fiscal restraint in local govemment, and continued cooperation among local government officials. We are confident that the City is positioning itself to better meet the needs of the community in the future through more effective long-term financial planning, and increased financial strength and stability of the City. The City Council and its staff are committed to managing the City's destiny well into the future. Major Initiatives The Court Street Transportation Center was begun in FY02 with design and land acquisition costs. Land acquisition was completed in FY03 with construction beginning in FY04. The transportation center, located in downtown Iowa City, will provide a park-and-ride facility, interstate bus service, taxi service, a parking facility and a day care center. $10.2 million in federal grants will fund the $12.8 million facility. Completion is set for FY05. The City continues to be proactive in maintaining and building its streets, bridges, stormwater mains, and trail systems and spent approximately $4.8 million in fiscal year 2004 on various projects. Mormon Trek Boulevard Extension was begun in FY02 with design costs. Land acquisition was completed in FY03 and construction began in FY04 on Phase 1. When all phases are completed, the roadway will serve a combination of through and local traffic needs. Estimated costs for the entire project total $7.6 million with $1.8 million in federal funding. The Plaza Towers is a $27 million mixed-use project on Iowa City's last downtown urban renewal parcel. The project will include a full-service grocery store, conference space, luxury hotel suites, and residential units. Commercial office and retail space is also planned. The project uses tax increment financing with the City's contribution being up to $6 million in taxable General Obligation bonds issued in March 2004, repayable from taxes generated in the downtown urban renewal district. The Iowa City Housing Authority provides rental assistance for 1213 units, with an annual con~ibution contract with the Federal Government of $6.6 million. Community Development Block Grant and HOME Investment Partnership funds totaling approximately $1.6 million were utilized for economic development, housing, public services and facilities, and planning activities during fiscal year 2004. These programs provide for broad based financial impacts locally for builders, developers, and others. Financial Information Single Audit: As a recipient of federal financial assistance, the City is responsible for ensuring that adequate intemal controls are in place to ensure compliance with applicable laws and regulations related to those programs. These internal accounting and administrative controls are subject to periodic evaluation by the City's management. The results of the City's single audit for the fiscal year ended June 30, 2004 provided no instances of material weaknesses in the internal controls or significant violations of applicable laws and regulations based upon the audit of the basic financial statements. Retirement Plans: With the exception of police and fire employees, substantially all permanent City employees are covered by the Iowa Public Employees Retirement System (1PERS). The state annually sets the contribution rate for all municipal entities and covered employees. All covered employees are required to contribute 3.7% of their salary, while employers contribute 5.75%. There is no allocation or measurement of unfunded liability to any municipal entity and, upon the retirement of employees, IPERS has the sole responsibility for their benefits. The City has no responsibility to pay employee pension benefits of IPERS besides the required contribution. The City's police and fire employees are covered by the Municipal Fire and Police Retirement System of Iowa (MFPRSI). This statewide system is a cost-sharing multiple-employer public employee retirement system. The state annually sets the contribution rate for all municipal entities and employees. The City has no responsibility to pay employee pension benefits of MFPRSI besides the required contribution. Cash Management: The majority of the City's investment activity is carried on by the City's investment pool, except for those funds which are required to maintain their investments separately. This pooled concept provides for greater investment earnings that are then allocated to the City's funds on a systematic basis. The intention of the cash management system is to limit the amount of funds placed in accounts where low or no interest is paid. Idle cash is invested in various instruments with various maturity dates of less than one year, depending on the anticipated cash requirements during the period. The overall strategy of holding deposits and making investments is to expose the City to a minimum amount of credit risk and market risk. All bank balances of deposits as of the balance sheet date are entirely insured or collateralized with securities held by the State of Iowa Sinking Fond. For the year ended June 30, 2004, the City earned $2,047,000 fi.om all investments, a decrease of $454,000 fi.om the prior year. The following table shows how this was allocated by fund type for the fiscal years 2004 and 2003: 2004 2003 Investment Investment Fund Type Earnings Earnings (in thousands) (in thousands) Governmental $ 989 $ 1,196 Proprietary 1,058 1,305 Totals $ 2~047 $ 2~501 Risk Management: The City is exposed to a variety of accidental losses and has established a risk management strategy that attempts to minimize losses and the carrying cost of insurance. Risk control techniques have been established to reasonably ensure that the City's employees are aware of their responsibilities regarding loss exposures related to their duties. In a similar manner, risk control techniques have been established to reduce possible losses to property owned by or under the control of the City. Furthermore, supervisory personnel are held responsible for monitoring risk control techniques on an operational basis. The City completed its fifteenth year under a property and liability insurance program that provides for a $200,000 self-insured retention per occurrence on property losses, a $500,000 self- insured retention per occurrence on liability, and a $300,000 self-insured retention on workers' compensation losses, with an annual aggregate retention of $425,000 on property losses. The insurance provides coverage for claims in excess of the aforementioned self-insured retention up to a maximum of $10,000,000 annual aggregate of the losses paid. The operating funds pay annual premiums to the Loss Reserve Fund, which is accounted for as an internal service fund. The balance in the Loss Reserve Fund is available to cover the self-insured retention amounts and any uninsured losses. The total assets in the Loss Reserve Fund as of June 30, 2004 were $4,575,000. Independent Audit: Chapter 11 of the Code of Iowa requires an annual audit to be performed. The independent public accounting firm of Eide Bailly LLP was selected by the City. In addition to meeting the requirements set forth in Chapter 11, the audit was also designed to meet the requirements of the Single Audit Act of 1996 and related OMB Circular A-133. The independent auditors' report on the basic financial statements and combining and individual fund statements and schedules is included in the financial section of this report. The independent auditors' reports related specifically to the single audit are included in the compliance section of this report. The financial statements are the responsibility of the City. The responsibility of the certified public accountants is to express an opinion on the City's financial statements based on their audit. An audit is conducted in accordance with generally accepted auditing standards. Those standards require that the audit be planned and performed in a manner to obtain a reasonable assurance as to whether the financial statements are free of material misstatement. Certificate of Achievement for Excellence in Financial Reporting The Govemment Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting (the Certificate) to the City of Iowa City, Iowa for its Comprehensive Annual Financial Report for the fiscal year ended June 30, 2003. The Certificate is the highest form of recognition for excellence in state and local financial reporting. In order to be awarded the Certificate, a governmental unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report, whose contents conform to program standards. The Comprehensive Annual Financial Report must satisfy both accounting principles generally accepted in the United States of America and applicable legal requirements. The Certificate is valid for a period of one year only. The City has received the Certificate for the last nineteen consecutive years. I believe our current report continues to conform to the Certificate requirements and am submitting it to GFOA to determine its eligibility for another certificate. Responsibility and Acknowledgments The Department of Finance prepared the Comprehensive Annual Financial Report of the City of Iowa City, Iowa for the fiscal year ended June 30, 2004. The City Council, as required by law, is responsible for the complete and accurate preparation of the City's Comprehensive Annual Financial Report. I believe that the information presented is accurate in all material respects and that this report fairly presents the financial position and results of operations of the various funds of the City. The preparation of this report on a timely basis could not have been accomplished without the efficient and dedicated services of the entire staff of the City's Finance Department. I would like to express my appreciation to all members of the department who assisted and contributed to its preparation. I want to especially recognize the contributions of the City's Assistant Finance Director, Erin Herting, Assistant Controller, Sara Sproule, Senior Accountant, Ann Maurer, and Intemal Auditor, Robin Marshall. Also, I thank the Mayor, members of the City Council and the City Manager for their interest and support in planning and conducting the financial operations of the City in a dedicated, responsible, and progressive Respectfully submitted, Key Citizens of Iowa City Mayor / By Clt~ I Council _ T T_ Airport Boards & City City City LlbrapJ Commission Commissions Attorney Manager CJerk Board of Tmstees lO CITY OF IOWA CITY, IOWA LISTING OF CITY OFFICIALS June 30, 2004 ELECTED OFFICIALS Term Expires Mayor Emie Lehman January 1, 2006 Council Member Regenia Bailey January 1, 2008 Council Member Connie Champion January 1, 2006 Council Member Bob Elliott January 1, 2008 Council Member Mike O'Donnell January 1, 2006 Council Member Dee Vanderhoef January 1, 2008 Council Member and Mayor Pro tem Ross Wilbum January 1, 2008 APPOINTED OFFICIALS Date of Hire City Manager Stephen J. Atkins July 20, 1986 City Clerk Marian K. Karr May 21, 1979 City Attorney Eleanor Dilkes March 18, 1996 DEPARTMENT DIRECTORS Assistant City Manager Dale E. Helling August 16, 1975 Director of Housing and Inspection Services Douglas W. Boothroy September 22, 1975 Library Director Susan Craig July 28, 1975 Director of Planning & Community Development Karin Franklin May 19, 1980 Director of Public Works Rick Fosse February 22, 1984 Director of Parking and Transit Joseph Fowler January 2, 1970 Senior Center Coordinator Linda Kopping March 20, 1995 Airport Manager Ronald J. O'Neil February 4, 1985 Fire Chief Andrew Rocca July 14, 1978 Parks and Recreation Director Terry G. Trueblood February 18, 1986 Chief of Police R.J. Winkelhake June 12, 1989 Director of Finance Kevin O'Malley August 19, 1985 11 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Iowa City For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2003 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. President Executive Director 12 INDEPENDENT AUDITOR'S REPORT To the Honorable Mayor and Members of the City Council City of Iowa City, Iowa We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa, as of and for the year ended June 30, 2004, which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the management of the City of Iowa City. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America; Chapter 11 of the Code of Iowa; and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards and provisions require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa, as of June 30, 2004, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund and Employee Benefits Fund for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated November 15, 2004, on our consideration of the City's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. The management's discussion and analysis on pages 15 through 24 is not a required part of the basic financial statements but is supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements of the City of Iowa City, Iowa. The introductory section, combining nonmajor fund financial statements, and statistical tables are presented for purposes of additional analysis and are not a required part of the basic financial statements. The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget A-133, Audits of State, Local Government, and Non-Profit Organization, and is also not a required part of the basic financial statements of the City of Iowa City, Iowa. The combining nonmajor fund financial statements and the Schedule of Expenditures of Federal Awards have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory section and statistical tables have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them. Dubuque, Iowa November 15, 2004 14 Management's Discussion and Analysis As management of the City of Iowa City, we present this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2004. This narrative is intended to be used in conjunction with additional information that is included in the letter of transmittal, which can be found on pages 3 - 9 of this report. Financial Highlights · The assets of the City of Iowa City exceeded its liabilities at the close of the fiscal year ending June 30, 2004 by $298,490,000 (net assets). Of this amount, $47,946,000 (unrestricted net assets) may be used to meet the government's ongoing obligations to its citizens and creditors. · The City's total net assets increased by $16,705,000 during the fiscal year. Governmental activities increased by $8,534,000 and business-type activities increased by $8,171,000. · At the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of $36,565,000, an increase of $1,985,000 in comparison with the prior year. Of this total amount, approximately $27,562,000, or 75% was unreserved and is available for spending at the City's discretion. · At the end of the current fiscal year, the City's unreserved, undesignated fund balance for the General Fund was $14,301,000, or 37% of total General Fund expenditures. · The City's total debt increased by $1,385,000, during the current fiscal year. The key factors to this increase were the retirement of bonds and issuance of new bonds. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's basic financial statements are comprised of three components: 1) government- wide financial statements, 2) fund financial statements; and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-wide Financial Statements: The government-wide financial statements are designed to provide readers with a broad overview of the City's finances in a manner similar to a private-sector business. The statement of net assets presents information on alt of the City's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include Public Safety, Public Works (roads, traffic controls, and transit), Culture and Recreation, Community and Economic Development, General Government, and Interest on long-term debt. The business-type activities of the City include Airport, Cable Television, Housing Authority, Parking, Sanitation, Stormwater Collection, Wastewater Treatment, and Water. 15 The government-wide financial statements can be found on pages 26 - 29 of this report. Fund Financial Statements: A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds and fiduciary funds. Governmental Funds: Governmental funds are used to account for essentially the same function reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements and is typically the basis that is used in developing the next annual budget. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison. The City has four major governmental funds: General Fund, Employee Benefits Fund, Capital Projects - Other Construction Fund, and Debt Service Fund. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balances for these major funds. Data from all other non-major governmental funds is combined into a single aggregated presentation and are referenced under a single column as "Other Governmental Funds". Individual fund data on each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for all governmental funds as required by state statute. Budget comparisons have been provided for the General Fund and the major special revenue fund, Employee Benefits fund, to demonstrate compliance with the adopted budget. The basic governmental funds financial statements can be found on pages 30 - 35 of this report. Proprietary Funds: The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its Airport, Cable Television, Housing Authority, Parking, Sanitation, Stormwater Collection, Wastewater Treatment, and Water activities. Internal Service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions. The City has four Internal Service Funds: Equipment Maintenance, Central Services, Loss Reserve, and Information Technology. Because these services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. Wastewater Treatment, Water, Sanitation, and Housing Authority Funds are considered to be major funds and are reported individually throughout the report. The other 4 non-major enterprise funds are grouped together for reporting purposes and listed under a single heading "Other Enterprise Funds". Detailed information for each of the non-major funds is provided in the combining statements on pages 78 - 80. Individual fund data for the Internal Service funds is provided in the form of combining statements elsewhere in this report. 16 The basic proprietary fund financial statements can be found on pages 40 - 45 of this report. Fidnciary Funds: Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not available to support the City's own programs and therefore are not reflected in the government-wide financial statements. The City has four fiduciary funds: Project Green, Library Foundation, Parks and Recreation Foundation, and PATV (Public Access Television) which are maintained as an agency fimds. The basic fiduciary funds financial statements can be found on page 46. Notes to Financial Statements: The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 47 - 71 of this report. Other Information: The combining statements referred to in the above paragraphs in connection with non-major governmental funds, non-major enterprise funds, and internal service funds are presented immediately following the notes. Government-wide Financial Analysis As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. In the case of the City, assets exceeded liabilities by $298,490,000 at the close of the fiscal year ended June 30, 2004. By far, the largest portion of the City's net assets reflect its investment in capital assets (e.g., land, building, machinery and equipment, improvements other than buildings, and infrastructure), less any related debt to acquire those assets that is still outstanding. The City uses these capital assets to provide services to its citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other resources, since the capital assets themselves cannot be used to liquidate these liabilities. City of Iowa City's Net Assets June 30, 2004 (~ts expressed in thousands) Governmental Business-type activities activities Total 2003 2003 2003 2004 as restated 2004 as restated 2004 as restated Current and other assets $ 94,819 $ 86,998 $ 79,114 $ 75,596 $173,933 $ 162,594 Capital assets 132,588 120,263 260,115 263,181 392,703 383,444 Total Assets 227,407 207,261 339,229 338,777 566,636 546,038 Long-term liabilities outstanding81,125 73,277 132,449 138,434 213,574 211,711 Ctaxent and other liabilities 49,787 46,023 4,785 6,519 54,572 52,542 Total Liabilities 130,912 119,300 137,234 144,953 268,146 264,253 Net assets: Invested in capital assets, net of related debt 67,090 48,536 150,817 136,398 217,907 184,934 Restricted 17,705 22,499 14,932 24,420 32,637 46,919 Unrestricted ! 1,700 16,926 36,246 33,006 47,946 49,932 Total Net Assets $ 96,495 $ 87,961 $ 201,995 $ 193,824 $298,490 $ 281,785 17 A portion of the City's net assets (10.9% or $32,637,000) represents resources that are subject to external restrictions on how they may be used. The remaining balance of the unrestricted net assets (16.1% or $47,946,000) may be used to meet the government's ongoing obligations to its citizens and creditors. At the end of the fiscal year ended June 30, 2004, the City is able to report positive balances in all three categories of net assets, both for the govemment as a whole, as well as for its separate governmental and business-type activities. Governmental Activities: Governmental activities increased the City's net assets by $8,534,000. The increase in net assets of governmental activities is primarily due to expenditures for capital assets less depreciation expense. The following is a more detailed review of FY04's operation. City of Iowa City's Changes in Net Assets (amounts expressed in tl~usands) Governmental Business-type activities activities Total 2004 2003 2004 2003 2004 2003 Revenues: Program Revenues: Charges for services $ 6,102 $ 6,378 $ 34,075 $ 32,988 $ 40,177 $ 39,366 Operating grants and contributions 2,150 2,965 6,959 6,659 9,109 9,624 Capital grants and contributions 6,198 2,205 2,253 1,717 8,451 3,922 General Revenues: Property taxes 34,173 32,257 34,173 32,257 Road use tax 5,311 5,144 5,311 5,144 Other taxes 1,609 1,399 1,609 1,399 Earnings on investments 1,056 1,207 991 1,305 2,047 2,512 Gain (loss) on disposal of capital ussel: 65 (1,726) 1,009 315 1,074 (1,411) Other 3,746 3,174 335 994 4,081 4,168 Total revenues 60,410 53,003 45,622 43,978 106,032 96,981 Expenses: Public safety 15,015 13,844 15,015 13,844 Public works 10,423 11,539 10,423 11,539 Culture and recreation 12,051 10,131 12,051 10,131 Community and economic developmer 2,580 3,133 2,580 3,133 General govmt 6,527 6,251 6,527 6,251 Interest on long-term debt 3,440 3,662 3,440 3,662 Wastewater Treatment 12,344 12,086 12,344 12,086 Water 8,011 7,861 8,011 7,861 Sanita6on 6,103 4,082 6,103 4,082 Housing Authority 7,219 6,519 7,219 6,519 Parking 3,898 3,554 3,898 3,554 Airport 515 431 515 431 Stormwater 652 652 Cable Television 549 687 549 687 Total expenses 50,036 48,560 39,291 35,220 89,327 83,780 Change in net assets before transfers 10,374 4,443 6,331 8,758 16,705 13,201 Transfers (1,840) 1,444 1,840 (l,n??.) Change in net assets 8,534 5,887 8,171 7,314 16,705 13,20 l Net assets beginning of year, as restated 87,961 82,074 193,824 186,510 281,785 268,584 Net assets end ofyear $ 96,495 $ 87,961 $ 201,995 $ 193,824 $ 298,490 $ 281,785 Business-type Activities: Business-type activities increased the City's total assets by $8,171,000. The increases in net assets were primarily in the Wastewater, Water, and Sanitation funds. For all business- type activities, revenues exceeded expenses by $6,331,000. This was primarily due to increases in revenue derived fi.om charges for services and miscellaneous revenue. Also there was an increase in transfers in and a decrease in transfers out for those funds. 18 Gove rnme ntal Activities FY2004 Reven_~ by Source Misc. Other Taxes Other Charges for 11% 8% services 10% Grants and Contributions 14% Business-Type Activities FY2004 Revenue by Source Grants and Misc. Other Contributions 5 % 20% 19 Governinental Activities FY2004 Expenditures by Program Area (amounts expressed in thousands) 18,000 Public Safety 16,000 Culture & 14,000 Recreation Public 12,000 Works 10,000 General 8,000 GOVt. 6,000 Interest 4,000 2,000 0 Program Area Business-Type Activities FY2004 Expenditures by Program Area (amounts expressed in thousands) 14,000 Wastewater 12,000 10,000 Housing 8,000 Authority 6,000 Parking 4,000 2,000 Stormwater Airport 0 Program Area 20 Governmental Activities FY2004 Revenue by Source Misc. Other Taxes Other Charges for 11% 8O/o services 10% Grants and Contributions 14% Business-Type Activities FY2004 Revenue by Source Misc. Other Grants and 5% Contributions 20% Charges for s er~ces 75% 19 Governmental Activities FY2004 Expenditures by Program Area (amounts expressed in thousands) 18,000 Public 16,000 Safety 14,000 ~ Recreation 12,000 10,000 General 8,000 G~. 6,000 Interest 4,000 2,000 0 Program Area Business-Type Activities FY2004 Expenditures by Program Area (amounts expressed in thousands) 14,000 Wastewater 12,000 10,000 Hous lng 8,000 Authority_ 6,000 Parking 4,000 2,000 Stormwater Airport Cable 0 Program Area 20 Financial Analysis of the Government's Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance- related legal requirements. Governmental Funds: The financial reporting focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information may be/is useful in assessing the City's financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. As of the fiscal year ended June 30, 2004, the City's governmental funds reported combined ending fund balances of $36,565,000, an increase of $1,985,000 in comparison with the prior year. Of this total amount, $27,562,000 constitutes unreserved fund balance, which is available to use as working capital for the General Fund since property tax revenues are received only twice a year and the remainder is available to meet the future needs of the City. The remainder of the fund balance (25%) is reserved to indicate that it is not available for new spending because it has already been committed. This remainder has been committed 1) to liquidate contracts and purchase orders of the prior period ($194,000), 2) to fund various debt service payments ($6,930,000), and 3) to fund employee retirement commitments ($1,544,000). The General Fund is the chief operating fund of the City. As of the fiscal year ended June 30, 2004, the unreserved fund balance of the General Fund was $14,301,000, while General Fund's total fund balance was $14,697,000. As a measure of the General Fund's liquidity, it may be useful to compare both "unreserved fund balance" and "total fund balance" to "total fund expenditures". Unreserved fund balance represents 37% of total General Fund expenditures ($38,616,000), while total fund balance represents 38% of that same amount. The fund balance of the City's General Fund increased by $1,370,000 during the current fiscal year. A key factor in this increase were reductions of expenditures due to City Council response to State Legislature reducing state-shared revenues in FY04. Proprietary Funds: The City's proprietary funds provide the same type of information found in the govemment-wide financial statements, but in more detail. The ending net assets of the enterprise funds were $196,317,000, a net asset increase of $7,921,000. This was primarily due to an increase in the investment of capital assets, net of related debt. Of the enterprise funds' net assets, $150,817,000 is invested in capital assets, net of related debt. Unrestricted net assets totaled $30,683,000, an increase of $2,772,000 compared to the previous year. The Internal Service funds showed net assets totalling $14,629,000 as of June 30, 2004, an increase of $580,000 from the previous year. Budgetary Highlights General Fund: Revenues for the general fund operations were less than the final amended budget by $1,803,000, but departmental expenditures on a budgetary basis were less than the final appropriated amounts by $2,447,000. During the year, revenues were 4.3% less than the final amended budget and expenditures were 5.7% less than the final amended budget. This was due to prospective land sales that did not materialize in the fiscal year. In the capital project financing of the November 2003 General Obligation bonds, a budgetary transfer for the payment of capital outlay was not included and thus the transfer did not occur in FY04. 21 Differences between original budget and the final amended budget of the general fund were minor. For revenues and other financing sources, the final amended budget was 3.4% more than the original budget and the final amended budget for expenditures and other financing uses was 3.8% more than the original budget. Upon recognition of the loss of intergovernmental revenue from the State, the City initiated revenue increases in the General Fund by raising charges for services. There also were increased budgeted transfers from the reserve fund. Expenditures for increased maintenance on the City's capital assets by City employees were deferred. A schedule detailing this activity can be found on pages 36 - 39. Capital Assets and Debt Administration Capital Assets: The City's investment in capital assets for its governmental and business-type activities as of June 30, 2004 amounts to $392,703,146 (net of accumulated depreciation). This investment in capital assets, including land, buildings, improvements other than buildings, equipment, streets, bridges, trails, wastewater and water systems, and other infrastructure represents the value of resources utilized to provide services to its citizens. The City's investment in capital assets for the fiscal year ended June 30, 2004 increased by $12,324,507 for governmental activities compared to the prior year and decreased by $3,064,792 for business-type activities over the prior year, based on the restated July I, 2003 capital assets. The following table reflects the $392,703,146 investment in capital assets (net of accumulated depreciation). City of Iowa City's Capital Assets (net of depreciation) (amounts expressed in thousands) Governmental Business-type Activities Activities Total 2004 2003 2004 2003 2004 2003 (as restated) (as restated) (as restated) Land $ 12,381 $ 11,786 $ 22,226 $ 22,226 $ 34,607 $ 34,012 Buildings 33,903 18,132 91,045 93,973 124,948 I 12,105 Improvements other than buildings 2,938 2,602 9,377 9,351 12,315 11,953 Machinery and equipment 11,225 11,117 14,330 15,127 25,555 26,244 infrastructure 60,846 56,098 118,873 117,536 179,719 173,634 Construction in progress 11,295 20,528 4,264 4,967 15,559 25,495 Total $ 132,588 $ 120,263 $ 260,115 $ 263,180 $ 392,703 $ 383,443 Major capital asset events during the current fiscal year included the following: · Expansion of the Iowa City Public Library was completed in FY04; capital assets for this project totaled $15,765,000. · Court Street Transportation Center that will include facilities for interstate bus service, taxi service, a parking facility and day care center began construction in FY04; CIP at fiscal year end totaled $5,039,000. a The extension of Mormon Trek Boulevard from Highway 1 to Highway 921 and accompanying sanitary sewer construction continued in FY04 with CIP at fiscal year end for both projects totaling $3,925,000. · Scott Boulevard from ACT to Rochester Avenue was completed in FY04 and added to the capital assets at a value of $2,886,000. · A variety of street and storm sewer construction in new residential areas and replacement and expansion of existing infrastructure amounted to $5,294,000. 22 Additional information on the City's capital assets can be found in Note 5 to the financial statements. Debt Administration: At the end of the fiscal year, the City had total bonded debt outstanding of $204,695,000. Of this amount, $88,985,000 comprises debt backed by the full faith and credit of the City. However, 11% of this total, $9,640,400 is debt that serves enterprise funds and is abated by their charges for services. The remaining $115,710,000 represents revenue bonds secured solely by specific revenue sources. City of Iowa City's Outstanding Debt General Obligation and Revenue Bonds (amounts expressed in thousands) Governmental Business-type Activities Activities Total 2004 2003 2004 2003 2004 2003 General obligation bonds $ 79,345 $ 71,641 $ 9,640 $ 11,359 $ 88,985 $ 83,000 Revenue bonds 115,710 120,310 115,710 120,310 Total $ 79,345 $ 71,641 $ 125,350 $ 131,669 $ 204,695 $ 203,310 The City's total bonded debt increased by $1,385,000 during the current fiscal year. · The City issued $5,570,000 in General Obligation bonds during FY04. The bonds were used to finance the cost of the City's 2004 Capital Improvements Program. · The City issued $7,305,000 in Taxable General Obligation bonds to finance the costs of aiding in the planning, undertaking and carrying out of urban renewal projects in connection with the Plaza Towers. The City continues to have the same excellent bond rating on its General Obligation bonds that it has had for the past several years. This rating is given to those bonds judged to be of the best quality and carrying the smallest degree of investment risks. The City's bond ratings by Moody's Investors Services, Inc. as of June 30, 2004 were as follows: General obligation bonds Aaa Parking revenue bonds A Wastewater treatment revenue bonds A Water revenue bonds A The City continues to operate well under the State debt capacity debt limitations. State statute limits the amount of General Obligation Debt outstanding to 5% of the assessed value of all taxable property in Iowa City. The current debt limitation for the City is $148,762,705. With outstanding General Obligation Debt applicable to this limit of $85,085,000 we are utilizing 57% of this limit. More detailed information on debt administration is provided in note 6 of the financial statements on pages 60 - 64. Economic Factors and Next Year's Budget and Rates The City's expectation is continued constraints by the State property tax formula. Therefore, the City will not have opportunities for new initiatives and will strive to maintain current service delivery levels. 23 Requests for Information This report is designed to provide a general overview of the City of Iowa City's finances for all of those with an interest in the government's finances. Questions concerning any of the information provided in this report, or requests for additional financial information should be addressed to City of Iowa City, Finance Depaxtment, 410 E. Washington Street, Iowa City, IA, 52240. 24 CITY OF IOWA CITY, IOWA STATEMENT OF NET ASSETS June 30, 2004 (amotmts expressed in thousands) Governmental Business-type Activities Activities Total Assets Equity in pooled cash and investments $ 43,378 $ 30,746 $ 74,124 Receivables: Property tax 35,038 35,038 Accounts and unbilled usage 267 3,401 3,668 Interest 257 221 478 Notes 8,500 t,367 9,867 Internal balances (6,146) 6,146 Due from other governments 4,786 147 4,933 Prepaid insurance 5 5 Inventories 341 323 664 Restricted assets: Equity in pooled cash and investments 8,393 36,763 45,156 Capital assets: Land and construction in progress 23,675 26,490 50,165 Other capital assets (net of accumulated depreciation) 108,913 233,625 342,538 Total assets 227,407 339,229 566,636 Liabilities Accounts payable 2,345 416 2,761 Contracts payable 3,603 507 4,110 Accrued liabilities 2,427 232 2,659 Interest payable 388 2,850 3,238 Deposits 787 676 1,463 Due to other governments 104 104 Deferred revenue 40,237 40,237 Noncurrent liabilities: Due with'm one year: Employee vested benefits 850 189 1,039 Bonds payable 9,357 6,067 15,424 Due in more than one year: Employee vested benefits 872 198 1,070 Bonds payable 70,046 118,120 188,166 Landfill closure/post-closure liability 7,875 7,875 Total liabilities 130,912 137,234 268,146 (continued) 26 CITY OF IOWA CITY, IOWA STATEMENT OF NET ASSETS (continued) June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities Activities Total Net Assets Invested in capital assets, net of related debt $ 67,090 $ 150,817 $ 217,907 Restricted for or by: Employee benefits 1,544 1,544 Capital projects 4,747 4,747 Debt service 6,930 6,930 Stxeets 4,431 4,431 Other purposes 53 53 Bond ordinance - 12,540 12,540 State statute - 315 315 Future improvements - 115 115 Grant agreement ~ 1,962 1,962 Unrestricted 11,700 36,246 47,946 Totalnet assets $ 96,495 $ 201,995 $ 298,490 The notes to the financial statements are an integral part of this statement. 27 CITY OF IOWA CITY, IOWA STATEMENT OF ACTIVITIES For the Year Ended June 30, 2004 (amounts expressed in thousands) Program Revenues Operating Capital Charges Grants and Grants and Functions/Programs: Expenses for Services Contributions Contributions Governmental activities: Public safety $ 15,015 $ 3,038 $ 126 $ 91 Public works 10,423 1,006 714 6,079 Culture and recreation 12,051 630 3 Community and economic development 2,580 !,307 28 General government 6,527 1,428 Interest on long-term debt 3,440 Total governmental activities 50,036 6,102 2,150 6,198 Business-type activities: Wastewater Treatment 12,344 12,580 968 Water 8,011 9,164 452 Sanitation 6,103 7,1 ! 1 9 Housing Authority 7,219 219 6,950 Parking 3,898 4,011 Airport 515 213 116 Stormwater 652 104 717 Cable television 549 673 Total business-type activities 39,291 34,075 6,959 2,253 Total $ 89,327 $ 40,177 $ 9,109 $ 8,451 General revenues: Property taxes, levied for general purposes Road use tax Hotel/motel tax Gas and electric tax Bank franchise tax Earnings on investments Gain on disposal of capital assets Miscellaneous Transfers Total general revenues and transfers Changes in net assets Net assets beginning of year (as restated) Net assets end of year The notes to the financial statements are an integral part of this statement. 28 Net (Expense) Revenue and Changes in Net Assets Governmental Business-type Activities Activities Total $ (11,760) $ $ (11,760) (2,624) (2,624) (11,418) (11,418) (1,245) - (1,245) (5,099) - (5,099) (3,440) - (3,440) (35,586) - (35,586) 1,204 1,204 1,605 1,605 1,017 1,017 (50) (50) 113 113 (186) (186) 169 169 124 124 3,996 3,996 (35,586) 3,996 (31,590) 34,173 34,173 5,311 5,311 580 580 785 785 244 244 1,056 991 2,047 65 1,009 1,074 3,746 335 4,081 (1,840) 1,840 44,120 4,175 48,295 8,534 8,171 16,705 87,961 193,824 281,785 $ 96,495 $ 201,995 $ 298,490 29 CITY OF IOWA CITY, IOWA BALANCE SHEET GOVERNMENTAL FUNDS June 30, 2004 (amounts expressed in thousands) Special Capital Revenue Projects Other Employee Other Debt Governmental General Benefits Construction Service Funds Total Assets Equity in pooled cash and investments $ 15,382 $ 1,573 $ 444 $ 6,852 $ 9,274 $ 33,525 Receivables: Property tax 19,521 7,442 8,075 35,038 Accounts and unbilled usage 158 55 213 Interest 136 4 3 18 54 215 Notes 258 8,242 8,500 Advances to other funds 113 - 113 Due from other governments 1,527 183 1,498 1,534 4,742 Inventories 131 - 131 Restricted assets: Equity in pooled cash and investments 1,049 7,343 8,392 Total assets $ 38,275 $ 9,202 $ 9,288 $ 14,945 $ 19,159 $ 90,869 (continued) 30 CITY OF IOWA CITY, IOWA BALANCE SHEET (Continued) GOVERNMENTAL FUNDS June 30, 2004 (amounts expressed in thousands) Special Capital Revenue Projects Other Employee Other Debt Governmental General Benefits Construction Service Funds Total Liabilities and Fund Balances Liabilities: Accounts payable $ 622 $ 74 $ 985 $ $ 258 $ 1,939 Contracts payable 2,745 858 3,603 Accrued liabilities 874 I 8 31 914 Advances from other funds 491 42 48 581 Deferred revenue 20,804 7,583 761 8,015 9,317 46,480 Liabilities payable from restricted assets: Deposits 787 787 Total liabilities 23,578 7,658 4,541 8,015 10,512 54,304 Fund balances: Reserved for: Inventories 131 131 Encumbrances 61 133 194 Debt service 6,930 6,930 Long-term receivables I 13 113 Employee retirement commitments 1,544 1,544 Perpetual care 91 91 Unreserved Designated: For future improvements 4,614 4,614 Undesignated: General fund 14,301 14,301 Special revenue funds 9,379 9,379 Capital projects funds (732) (732) Total fund balances 14,697 1,544 4~747 6,930 8,647 36,565 Total liabilities and fund balances $ 38,275 $ 9,202 $ 9,288 $ 14,945 $ 19,159 $ 90,869 The notes to the financial statements are an integral part of this statement. 31 CITY OF IOWA CITY, IOWA RECONCILIATION OF THE BALANCE SHEET OF THE GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS June 30, 2004 (amounts expressed in thousands) Total governmental fund balances $ 36,565 Amounts reported for governmental activities in the statement of net assets are different because: Internal service funds are used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net assets. 14,629 Prepaid insurance benefits future periods and is included in governmental activities in the statement of net assets. 5 Other long-term assets are not available to pay for current period expenditures and therefore are deferred in the funds: Notes receivable - Earned but unavailable 6,243 Capital assets used in governmental activities are not current financial resources and therefore are not reported in the funds. 126,149 Accrued compensated absences are not due and payable in the current period and therefore are not reported in the funds. (1,627) Bonds payable are not due and payable in the current period and therefore are not reported in the funds. (79,403) Accrued interest on bonds (388) Internal balance due to integration of internal service funds (5,678) Total net assets of governmental activities $ 96,495 The notes to the financial statements are an integral part of this statement. 32 CITY OF IOWA CITY, IOWA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS For the Year Ended June 30, 2004 (arnotmts expressed in thousands) Special Capital Revenue Projects Other Employee Other Debt Governmental General Benefits Construction Service Funds Total Revenues Taxes $ 19,458 $ 6,832 $ $ 9,078 $ 170 $ 35,538 Licenses and permits 1,361 1,361 Intergovernmental 1,884 2,527 7,647 12,058 Charges for services 3,079 135 26 3,240 Use of money and property 569 14 196 142 81 1,002 Miscellaneous 3,420 1 19 561 376 4,377 Total revenues 29~771 6,982 2,742 9,781 8,300 57,576 Expenditures Current: Public safety 13,660 342 23 14,025 Public works 8,328 12 816 9,156 Culture and recreation 8,898 494 9,392 Community and economic development 797 38 2,651 3,486 General government 5,453 80 543 4 6,080 Debt service: Principal 5,172 5,172 lnterest 3,336 3,336 Capital outlay 1,480 10,922 3,663 16,065 Total expenditures 38,616 422 12,032 8,512 7,130 66,712 Excess (deficiency) of revenues over (under) expenditures (8,845) 6,560 (9,290) 1,269 l, 170 (9,136) Other Financing Sources (Uses) Proceeds from bond issuance 5,570 1,222 6,083 12,875 Proceeds from sale of capital assets 134 250 384 Premium (discount) on issuance of bonds 39 (9) (49) (19) Transfers in 10,498 577 3,539 14,614 Transfers out (417) (7,103) (4,171) (5,042) (16,733) Total other financing sources and (uses) 10,215 (7,103) 2,015 1,213 4,781 11,121 Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses 1,370 (543) (7,275) 2,482 5,951 1,985 Fund Balances, Beginning (as restated) 13,327 2,087 12,022 4,448 2,696 34,580 Fund Balanees, Ending $ 14,697 $ 1,544 $ 4,747 $ 6,930 $ 8,647 $ 36,565 The notes to the financial statements are an integral part of this statement. 33 CITY OF IOWA CITY, IOWA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For the Year Ended June 30, 2004 (amounts expressed in thousands) Net change in fund balances - total governmental funds $ 1,985 Amotmts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the asset. Capital outlays and contributed capital assets exceeded depreciation expense in the current year as follows: Expenditures for capital assets $ 14,572 Capital assets contributed 2,702 Depreciation expense (4,797) 12,477 Bond proceeds are reported as financing sources in governmental funds and thus contribute to the change in fund balance. In the statement of net assets, however, issuing debt increases long-term liabilities and does not affect the statement of activities. Similarly, repayment of principal is an expenditure in the governmental funds but reduces the liability in the statement of net assets. Debt issued (t2,875) Discount on bonds issued 19 Repayments of debt 5,172 Amortization of premium 7 (7,677) Because some revenues will not be collected for several months after the City's year end, they are not considered available revenues and are deferred in the governmental funds. 1,941 Some expenses reported in the statement of activities do not require the use of ctuxent financial resources and therefore are not reported as expenditures in governmental funds: Change in accrued compensated absences (75) Change in accrued interest on debt (111) In the statement of activities, only the gain on the sale of the capital assets is recognized, whereas in the governmental funds, the proceeds from the sale increased financial resources. Thus, the change in net assets differs from the change in fund balance by the cost of the capital asset sold. (319) Prepaid items in the governmental funds have been recorded as expenditures when paid. However, the statement of activities will report these items as expenses in the period that the corresponding net asset is exhausted. (17) Internal service funds are used by management to charge the costs of certain activities to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities. 330 Change in net assets of governmental activities $ 8,53~4 The notes to theJlnancial statements are an integral part of this statement. 35 CITY OF IOWA CITY, IOWA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND (BUDGETARY BASIS) For the Year Ended June 30, 2004 (amounts expressed in thousands) Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues Property taxes $ 18,489 $ 18,489 $ 18,473 $ (16) Other City taxes: Utility tax replacement excise 435 435 427 (8) Hotel/motel taxes 550 550 563 13 Licenses and permits 966 1,043 1,352 309 Intergovernmental 3,588 2,833 2,836 3 Charges for services 3,134 3,271 3,425 154 Use of money and property 436 450 323 (127) Miscellaneous 1,645 2,947 2,039 (908) Total revenues 29,243 30,018 29,438 (580) Expenditures Current: Public safeW: Police depat tment/crime prevention 8,147 8,041 7,689 352 Fire department 4,863 4,850 4,667 183 Building inspections 1,120 1,116 1,077 39 Animal control 553 564 551 13 Total public safety 14,683 14,571 13,984 587 Public works: Roads, bridges, and sidewalks 2,226 2,293 1,900 393 Street lighting 365 365 355 10 Traffic control and safety 675 677 632 45 Snow removal 131 131 378 (247) Highway engineering 1,067 1,043 846 197 Street cleaning 43 43 215 (172) Other public works 3,928 4,461 4,069 392 Total public works 8,435 9;013 8,395 618 Culture and recreation: Library services 4,112 4,017 3,999 18 Parks 1,590 1,562 1,485 77 Recreation 2,563 2,851 2,381 470 Cemetery 331 353 294 59 Other culture and recreation 583 682 769 (87) Total culture and recreation 9,179 9,465 8,928 537 (continued) 36 CITY OF IOWA CITY, IOWA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (continued) GENERAL FUND (BUDGETARY BASIS) For the Year Ended June 30, 2004 (amounts expressed in thousands) Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) Community and economic development: Community beautification $ 712 $ 484 $ 410 $ 74 Economic development 185 590 153 437 Housing and urban renewal 27 63 (36) Planning and zoning 721 697 641 56 Total community and economic development 1,618 1,798 1,267 531 General government: Mayor, council, and City Manager 625 617 593 24 Clerk, treasurer, and finance admin. 2,753 2,737 2,552 185 Legal services and City attorney 557 558 558 City hall and general buildings 421 434 415 19 Tort liability 582 712 590 122 Other general government 1,423 1,723 1,341 382 Total general government 6,361 6,781 6,049 732 Total expenditures 40,276 41,628 38,623 3,005 Deficiency of revenues under expenditures (11,033) ( 11,610) (9,185) 2,425 Other Financing Sources (Uses) Transfers in 11,096 11,703 10,678 (1,025) Proceeds of capital asset sales 371 376 178 (198) Transfers out (884) (1,082) (1,640) (558) Total other fmancing sources and (uses) 10,583 10,997 9,216 ( 1,781 ) Net change in fund balances (450) (613) 31 644 Fund Balances, Beginning 13,593 15,057 15,669 612 Fund Balances, Ending $ 13,143 $ 14,444 $ 15,700 $ 1,256 The notes to the financial statements are an integral part of this statement. 37 CITY OF IOWA CITY, IOWA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL EMPLOYEE BENEFITS FUND (BUDGETARY BASIS) For the Year Ended June 30, 2004 (amounts expressed in thousands) Variance with Final Budget - Budgeted Amounts Positive Original Final Actual Amounts (Negative) Revenues Property taxes $ 5,922 $ 6,691 $ 6,675 $ (16) Other City taxes: Utility tax replacement excise 140 158 154 (4) Intergovernmental 147 119 135 16 Use of money and property 15 337 19 (318) Miscellaneous 1 1 Total revenues 6,224 7,305 6,984 (321) Expenditures Current: Other public safety 126 485 273 212 Other general government 211 321 80 241 Total expenditures 337 806 353 453 Excess of revenues over expenditures 5,887 6,499 6,631 (132) Other Financing Sources (Uses) Transfers in 585 585 585 Transfers out (6,588) (7,674) (7,688) (14) Total other £mancing sources and (uses) (6,003) (7,089) (7,103) (14) Net change in fund balances (116) (590) (472) ! 18 Fund Balances, Beginning 1,907 2,068 2,068 Fund Balances, Ending $ 1,791 $ 1,478 $ 1,596 $ 118 The notes to the.financial statements are an integral part of this statement. 39 CITY OF IOWA CITY, IOWA STATEMENT OF NET ASSETS PROPRIETARY FUNDS June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities - Enterprise Funds Activities - Other Intemal Wastewater Housing Enterprise Service Treatment Water Sanitation Authority Funds Total Funds Assets Current assets: Equity in pooled cash and investments $ 4,983 $ 12,106 $ 10,366 $ 1,362 $ 1,929 $ 30,746 $ 9,853 Receivables: Accounts and unbilled usage 1,534 1,013 620 ! 233 3,401 54 Interest 63 68 65 15 10 221 42 Notes 923 444 1,367 Advances to other funds 1,517 1,517 Due fi.om other governments 14 1 17 115 147 44 Inventories 323 323 210 Total current assets 6,580 13,524 12,569 2,318 2,731 37,722 10,203 Noncurrent assets: Restricted assets: Equity in pooled cash and investments 14,011 7,383 11,371 1,962 2,036 36,763 1 Capital assets: Land 695 6,235 325 928 14,043 22,226 45 Buildings and structures 59,475 23,321 869 6,289 29,132 119,086 832 Improvements other than buildings 7,284 2,631 78 415 10,408 50 Equipment and vehicles 9,919 10,194 153 63 588 20,917 11,232 Infi'astructure 80,201 36,048 9,268 28,765 154,282 940 Accumulated depreciation (37,888) (8,954) (5,662) (2,955) (15,609) (71,068) (6,660) Construction in progress 1,358 1,837 20 1,049 4,264 Total noncurrant assets 135,055 78,695 16,422 6,287 60,419 296,878 6,440 Total assets 141,635 92,219 28,991 8,605 63,150 334,600 16,643 (continued) 40 CITY OF IOWA CITY, IOWA STATEMENT OF NET ASSETS (continued) PROPRIETARY FUNDS June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities - Enterprise Funds Activities - Other Internal Wastewater Housing Enterprise Service Treatment Water Sanitation Authority Funds Total Funds Liabilities Current liabilities: Accounts payable $ 79 $ 237 $ 58 $ 18 $ 24 $ 416 $ 406 Contracts payable 110 283 25 89 507 Accrued liabilities 121 147 142 42 167 619 1,608 Advances from other funds 1,049 1,049 Due to other governments 1 21 62 20 104 Bonded debt payable (net of unamortized discounts) 3,745 1,732 590 6,067 Total current liabilities 4,056 2,420 287 80 1,919 8,762 2,014 Noncurrent liabilities: Liabilities payable from restricted assets: Interest payable 1,805 707 338 2,850 Deposits 379 293 4 676 Bonded debt payable (net of unamortized discounts) 71,969 34,587 11,564 118,120 Landfill closure/postclosure liability 7,875 7,875 Total noncurrent liabilities 73,774 35,673 7,875 293 11,906 129,521 Total liabilities 77,830 38,093 8,162 373 13,825 138,283 2,014 Net Assets Invested in capital assets, net of related debt 53,187 40,839 5,051 4,325 47,415 150,817 6,439 Restricted by bond ordinance 8,578 2,685 1,277 12,540 Restricted by state statute 315 315 Restricted for future improvements 115 115 Restricted by grant agreement 1,962 1,962 Unrestricted 2,040 10,602 15,463 1,945 518 30,568 8,190 Total net assets $ 63,805 $ 54,126 $ 20,829 $ 8,232 $ 49,325 196,317 $ 14,629 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds. 5,678 Net assets of business-type activities $ 201,995 The notes to the financial statements are an integral part of this statement. 41 CITY OF IOWA CITY, IOWA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities - Enterprise Funds Activities - Other Internal Wastewater Housing Enterprise Service Treatment Water Sanitation Authority Funds Total Funds Operating Revenues: Charges for services $ 12,580 $ 9,164 $ 7,111 $ 219 $ 5,001 $ 34,075 $ 10,899 Miscellaneous 51 126 17 48 93 335 4 Total operating revenues 12,631 9,290 7,128 267 5,094 34,410 10,903 Operating Expenses: Personal services 1,618 1,834 1,743 705 1,980 7,880 1,319 Commodities 530 81 $ 227 40 237 1,849 1,100 Services and charges 2,375 1,711 3,183 6,245 1,059 14,573 7,237 4,523 4,360 5,153 6,990 3,276 24,302 9,656 Depreciation 4,134 1,888 947 230 1,629 8,828 1,302 Total operating expenses 8,657 6,248 6,100 7,220 4,905 33,130 10,958 Operating income (loss) 3,974 3,042 1,028 (6,953) 189 1,280 (55) Nonoperating Revenues (Expenses): Gain on disposal of equipment 927 82 1,009 28 Operating grants 9 6,950 6,959 Interest income 316 410 134 63 68 991 67 Interest expense (3,684) (1,759) (707) (6,150) Total nonoperating revenues (expenses) (3,368) ~ (422) 143 7,095 (639) 2,809 95 Income (loss) before capital contributions and transfers 606 2,620 1,171 142 (450) 4,089 40 Capital contributions 968 452 833 2,253 Transfers in 86 1,094 1,624 2,804 540 Transfers out (6) (232) (250) (8) (729) (1,225) Change in net assets 1,654 3,934 921 134 1,278 7,921 580 Net Assets, Beginning (as restated) 62,151 50,192 19,908 8,098 48,047 14,049 Net Assets, Ending $ 63,805 $ 54,126 $ 20,829 $ 8,232 $ 49,325 $ 14,629 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds. 250 Change in net assets of business-type activities $ 8,171 The notes to the financial statements are an integral part of this statement. 43 CITY OF IOWA CITY, IOWA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For the Year Ended June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities - Enterprise Funds Activities - Other Internal Wastewater Housing Enterprise Service Treatment Water Sanitation Authority Funds Total Funds Cash Flows From Operating Activities Receipts from customers and users $ 12,958 $ 9,431 $ 7,024 $ 582 $ 4,949 $ 34,944 $ 10,988 Payments to suppliers (2,892) (2,391) (3,364) (6,361) (1,972) (16,980) (8,291) Payments to employees (1,606) (1,83 l) (1,723) (705) (1,961) (7,826) (1,167) Net cash flows from operating activities 8,460 5,209 1,937 (6,484) 1,016 10,138 1,530 Cash Flows From Noncapital Financing Activities Operating grants received 9 6,950 6,959 Operating transfers from other funds 86 1,094 1,624 2,804 540 Operating transfers to other funds (6) (232) (250) (8) (397) (893) Repayment of notes receivable 25 25 Repayment of advances from other funds (117) (117) Repayment of advances to other funds 257 388 645 Net cash flows from noncapital financing activities 337 745 147 6,967 1,227 9,423 540 Cash Flows From Capital and Related Financing Activities Capital grants received 116 l 16 Repayment of advances from other funds (122) (122) Acquisition and construction of property and equipment (1,467) (2,053) (45) (6) (1,249) (4,820) (1,252) Proceeds from sale of property l, 164 232 1,396 152 Principal paid on bonded debt (3,628) (1,943) (671) (6,242) Interest paid on bonded debt (3,749) (1,821) (722) (6,292) Net cash flows from capital and related financing activities (8,844) (4,653) (45) 226 (2,648) (15,964) (1,100) Cash Flows From Investing Activities Interest on investments 329 405 137 48 67 986 62 Net increase (decrease) in cash and cash equivalents 282 1,706 2,176 757 (338) 4,583 1,032 Cash and Cash Equivalents, Beginning 18,712 17,783 19,561 2,567 4,303 62,926 8,822 Cash and Cash Equivalents, Ending $.... 18,994 $ 19,489 $ 21,737 $ 3,324 $ 3,965 $ 67,509 $ 9,854 44 CITY OF IOWA CITY, IOWA STATEMENT OF CASH FLOWS (continued) PROPRIETARY FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Governmental Business-type Activities - Enterprise Funds Activities - Other lntemal Wastewater Housing Enterprise Service Treatment Water Sanitation Authority Funds Total Funds Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss) $ 3,974 $ 3,042 $ 1,028 $ (6,953) $ 189 $ 1,280 $ (55) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 4,134 1,888 947 230 1,629 8,828 1,302 Changes in: Receivables: Accounts and unbilled usage 327 125 (103) (1) (70) 278 (32) Due fi.om other governments (6) (1) 305 (79) 219 118 Inventories I I (1) Accounts payable 12 145 44 (11) (676) (486) 46 Accrued liabilities 12 3 20 19 54 152 Due to other governments 1 (11) 2 (65) (73) Deposits 22 11 4 37 Total adjustments 4,486 2,167 909 469 827 8,858 1,585 Net cash flows from operating activities $ 8,460 $ 5,209 $ 1,937 $ (6,484) $ 1,016 $ 10,138 $ 1,530 Noncash Investing, Capital, and Financing Activities: Contributions of fixed assets from government andothers $ 968 $ 438 $ $ $ 717 $ 2,123 $ The notes to the financial statements are an integral part of this statement. 45 CITY OF IOWA CITY, IOWA STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES June 30, 2004 (amounts expressed in thousands) Agency Funds Assets Equity in pooled cash and investments $ 396 Accounts receivable 19 Interest receivable 1 Total assets $ 416 Liabilities Accounts payable $ 84 Accrued liabilities 4 Due to agency 328 Total liabilities $ 416 The notes to the financial statements are an integral part of this statement. 46 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS June 30, 2004 1. Accounting Policies The City of Iowa City, Iowa, (the City) was incorporated April 6, 1853, and operates under the Council/Manager form of government. The City provides a broad range of services to its citizens including general government, a mass transportation system, public safety, streets, parks, and cultural facilities. It also operates an airport, parking facilities, water treatment, wastewater treatment, stormwater collection, sanitation collection and disposal (including landfill operations), cable television, and a housing authority. The financial statements of the City have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant accounting policies of the City are described below. The Reporting Entity For financial reporting purposes, the City includes all of its funds, organizations, agencies, boards, commissions, and authorities. The City has also considered all potential component units for which it is financially accountable, and other organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City's financial statements to be misleading or incomplete. The Governmental Accounting Standards Board has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization's governing body, and (1) the ability of the City to impose its will on that organization or (2) the potential for the organization to provide specific benefits to, or impose specific financial burdens on the City. There were no component units required to be included. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the Statement of Net Assets and the Statement of Activities) report information on all of the nonfiduciary activities of the primary government. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported as general revenues. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are charges between the City's water and sewer function and various other functions of the government. Eliminations of these charges would distort the direct costs and program revenues reported for the various functions concerned. 47 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate colunms in the fund financial statements. Description of Funds These financial statements include all funds owned or administered by the City, for which the City acts as custodian. The City maintains its records on a modified cash basis of accounting under which only cash receipts, cash disbursements and encumbrances, investments, and bonded debt are recorded. These modified cash basis accounting records have been adjusted to the accrual or modified accrual basis, as necessary, to prepare the accompanying financial statements in accordance with GAAP. The accounts of the City are organized on the basis of funds, each of which is considered to be a separate accounting entity. The fund categories are governmental, proprietary, and fiduciary. Each fund is accounted for by providing a separate set of self-balancing accounts that comprise its assets, liabilities, net assets, revenues, and expenditures or expenses, as appropriate. The individual funds account for the governmental resources allocated to them for the purpose of carrying on specific activities in accordance with laws, regulations, or other restrictions. Basis of Accounting Thc accounting and financial reporting treatment applied to a fund is determined by its "measurement focus." The government-wide financial statements, proprietary funds, and fiduciary funds are accounted for on the flow of economic resources measurement focus and use the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. The City applies all applicable Financial Accounting Standards Board pronouncements issued on or before November 30, 1989, except those that conflict with GASB pronouncements, in accounting and reporting for these funds. All governmental funds are accounted for using a current financial resources measurement focus, which generally includes only current assets and current liabilitics on the balance sheet. The modified accrual basis of accounting is used for these funds. Under the modified accrual basis, revenue is recognized when susceptible to accrual, which is in the period in which it becomes both available (collectible within the current period or soon thereafter to be used to pay liabilities of the current period) and measurable (the amount of the transaction can be determined). Revenue accrued includes property taxes, intergovernmental revenue, and interest earned on investments (if they are collected within 60 days after the year-end). Expenditures are recorded when the related fund liability is incurred. Principal and interest on long-term debt, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. The City reports the following major govemmental funds: The General Fund is the City's primary operating fund. It accounts for all financial resources of the general govemment, except those required to be accounted for in another fund. 48 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 The Employee Benefits Fund is used to account for the employee benefits related to those employees who are paid through governmental fund types, which are funded by a separate property tax levy. The Capital Projects Other Construction Fund accounts for the construction or replacement of certain City general capital assets, such as administrative buildings, with various funding sources including general obligation bonds, intergovernmental revenues and contributions. The Debt Service Fund accounts for the accumulation of resources for and the payment of general long-term debt principal, interest, and related costs. The City reports the following major proprietary funds: The Wastewater Treatment Fund is used to account for the operation and maintenance of the wastewater treatment facility and sanitary sewer system. The Water Fund is used to account for the operation and maintenance of the water system. The Sanitation Fund is used to account for the operation and maintenance of the solid waste collection system and landfill. The Housing Authority Fund is used to account for the operations and activities of the City's low and moderate income housing assistance and public housing programs. Additionally, the City reports internal service funds to account for goods and services provided by one department to other City departments on a cost reimbursement basis. The funds in this category are the Equipment Maintenance Fund, Central Services Fund, Loss Reserve Fund, and the Information Technology Fund. The City also reports fiduciary funds which are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statement because the resources of those funds are not available to support the City's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The City has four fiduciary funds which are maintained as agency funds, with no attempt to create an ongoing fund balance. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City's enterprise funds and of the City's internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the government's policy to use restricted resources first, then unrestricted resources as they are needed. 49 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Uses of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue, expenditures and expenses, as appropriate, during the reporting period. Actual results could differ from these estimates. Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of landfill closure and postclosure care costs, total capacity of the landfill at closure, and calculation of the costs of claims incurred, but not reported. Cash and Investments The City maintains one primary demand deposit account through which the majority of its cash resources are processed. Substantially all investment activity is carried on by the City in an investment pool, except for those funds required to maintain their investments separately. The earnings on the pooled investments are allocated to the funds on a systematic basis. All investments are stated at fair value. For the purpose of the Statement of Cash Flows, restricted and nonrestricted investments with a maturity of three months or less when purchased are considered cash equivalents. Receivables and Revenue Recognition Property tax receivable is recognized in governmental funds on the levy or lien date, which is the date that the tax asking is certified by the City to the County Board of Supervisors. Current year delinquent property tax receivable represents unpaid taxes from the current year. The succeeding year property tax receivable represents taxes certified by the City to be collected in the next fiscal year for the purposes set out in the budget for the next fiscal year. By statute, the City is required to certify its budget to the County Auditor by March 15 of each year for the subsequent fiscal year. However, by statute, the tax asking and budget certification for the following fiscal year becomes effective on the first day of that year. Although the succeeding year property tax receivable has been recorded, the related revenue is deferred in both the government-wide and fund financial statements and will not be recognized as revenue until the year for which it is levied. Federal and state grants, primarily capital grants, are recorded as receivables and the revenue is recognized during the period in which the City fulfills the requirements for receiving the grant awards, as long as the susceptible to accrual criteria are met. Income from investments in all fund types and from charges for services in proprietary fund types is recognized when earned. Licenses and permits, fines and forfeitures, fees and refunds, charges for services (in governmental fund types), miscellaneous and other revenues are recorded as revenue when received in cash because they are generally not measurable until actually received. Inventories Inventories are recognized only in those funds in which they are material to the extent of affecting operations. For the City, these are the General Fund, Water Fund, and the Equipment Maintenance Fund. Inventories are reported at the lower of cost (first-in, first-out) or market. The costs of governmental fund type inventories are recorded as expenditures when purchased. 50 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Capital Assets Capital assets, which include property, buildings, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide l~mancial statements. The City follows the policy of not capitalizing an asset with an initial, individual cost of less than $50,000 for infrastructure assets and $5,000 for remaining assets. Such assets are recorded at original purchase cost or at fair value at the date of donation when received as donated properties. Depreciation is computed using the straight-line method over the following estimated useful lives: Infrastructure 3 - 100 years Buildings and structures 20 - 50 years Improvements other than buildings 15 - 50 years Vehicles 2 - 20 years Other equipment 5 - 30 years Bond Premiums and Discounts Debt issued at a premium or discount is recorded net of the unamortized premium discount. In the governmental funds, premiums and discounts are recorded entirely as other financing sources or uses in the year of issuance. In the proprietary funds and the government-wide statements, they are amortized over the life of the bonds. Compensated Absences Permanent City employees accumulate vacation and sick leave hours for subsequent use or for payment upon death, resignation, or retirement. The City pays its employees (except firefighters) one-half of the accumulated sick leave at the time of termination on the basis of the employee's then effective hourly base salary, provided that the dollar amount of the payment may be up to, but not exceed, the amount that an employee would be paid if the employee had terminated on June 28, 1985. Employees hired on or after June 29, 1985, are not eligible for payment of accumulated sick leave upon termination, death, or retirement. Pensions The provision for pension cost is recorded on the accrual basis (based on statutorily determined contribution rates), and the City's policy is to fund pension costs as they accrue. Landf'fll Closing Costs Costs expected to be incurred in ultimately closing the present landfill site are being systematically provided for through charges to expense over the estimated useful life of the landfill on the basis of capacity used (see Note l 3). 51 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Budgetary and Legal Appropriation and Amendment Policies The City prepares and adopts an annual function budget, as prescribed by Iowa statutes, for all funds except internal service and agency funds. This is formalized in a separate budgetary report, the Financial Plan. This budget is adopted on or before March 15 of each year to become effective July 1, and constitutes the City's appropriation for each program and purpose specified therein until amended. The adopted budget must include the following: a. Expenditures for each function: Public safety Public works Health and social services Culture and recreation Community and economic development General government Debt service Capital outlay Business-type b. The amount to be raised by property taxation c. Income from sources other than property taxation d. Transfers in and transfers out The legal level of control (the level at which expenditures may not legally exceed appropriations) is the function level for all funds combined, rather than at the individual fund level. Management can transfer appropriations within a function, within a fund type, and between fund types, without the approval of the governing body so long as the total budget by function area will not be exceeded. It is necessary, therefore, to aggregate the expenditures of the budgeted activities within the govemmental fund types with the expenditures of the budgeted activities within the enterprise funds on a function basis, and to compare such function totals to function budgeted totals in order to demonstrate legal compliance with the budget. The City's budget for revenue focuses on the individual fund revenue rather than on aggregated fund totals. The City formally adopts budgets for several funds that are not required by state law to be included in the annual function budget. Annual operating budgets are adopted for the internal service funds for management control purposes. Such budgets, however, are not legally required to be adopted under state statutes. These budgets are adopted and amended at the same time and in the same manner as the City's annual function budget. A City budget for the current fiscal year may be amended for any of the following purposes as prescribed by Iowa statute: a. To permit the appropriation and expenditure of unexpended, unencumbered cash balances on hand at the end of the preceding fiscal year. b. To permit the appropriation and expenditure of amounts anticipated being available from sources other than property taxation. c. To permit transfers between funds. d. To permit transfers between programs. 52 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 A budget amendment must be prepared and adopted in the same manner as the original budget. The City's budget was amended as prescribed, and the effects of those amendments are shown in the accompanying financial statements. The original budget was increased by $53 million due to carryover appropriations from the prior fiscal year and new appropriations for construction projects. Appropriations as adopted or amended, and not encumbered, lapse at the end of the fiscal year. Statements of budget and actual revenue and expenditures have been presented for the general fund and the major special revenue fund and disclosures are presented that compare budget and actual expenditures on the legal function budget basis for the City as a whole. The statements reflect the City's method of budget preparation, which records revenue and expenditures on a cash basis. Restricted Assets Assets within the individual funds, which can be designated by the City Council for any use within the fund's purpose, are considered to be unrestricted assets. Assets, which are restricted for specific uses by bonded debt requirements, grant provisions, or other requirements, are classified as restricted assets. Liabilities which are payable from restricted assets, are classified as such. 2. Compliance and Accountability At June 30, 2004, the Capital Project Fund for bridge, street, and traffic control construction reported a deficit fund balance of $732,477. Comparison of Actual Disbursements with Budget (Budgetary Basis) Under Iowa law, cities are required to account for disbursements in terms of City government functions. The nine City government functions are Public Safety, Public Works, Health and Social Services, Culture and Recreation, Community and Economic Development, General Government, Debt Service, Capital Outlay, and Business-type. The following table for the entire City, which includes the general, special revenue, debt service, capital projects, and enterprise funds, has been prepared to demonstrate legal compliance with that requirement (amounts expressed in thousands): Variance Positive Function Budget Actual (Negative) Public Safety $ 15,377 $ 14,258 $ 1,119 Public Works 9,021 8,406 615 Culture and Recreation 9,592 8,929 663 Community and Economic Development 8,844 4,560 4,284 53 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Variance Positive Function Budget Actual (Negative) General Govemment $ 7,098 $ 6,128 $ 970 Debt Service 11,125 10,705 420 Capital Outlay 31,895 13,735 18,160 Business-type 48,058 39,703 8,355 Total $ 141.__010 106,424 $ 34.586 Accrual adjustments (432) Expenditures/expenses - GAAP basis $ 105.992 3. Cash and Investments The City maintains a cash and investment pool that is available for use by all funds. Each fund's portion of this pool is presented on the balance sheet as "Equity in pooled cash and investments." Deposits At June 30, 2004, the carrying amount of the City's deposits, including certificates of deposit, was $111,336,598. The bank balances totaled $112,572,159. Of the bank balances, $1,021,347 was covered by federal depository insurance or the National Credit Union Insurance Fund, $20,172,660 was collateralized by a letter-of-credit held by the City in the City's name and $91,378,152 was collateralized with securities held by a multiple financial collateral pool in accordance with Chapter 12C of the Code of Iowa. Chapter 12C provides for additional assessments against public funds depositories to ensure that there will be no loss of public funds. Investments The City is authorized by statute to invest public funds in obligations of the United States Government, its agencies and instrumentalities; certificates of deposit or other evidences of deposit at federally-insured depository institutions approved by the City Council; prime eligible bankers acceptances; certain high- rated commercial paper; perfected repurchase agreements; certain registered open-end management investment companies; certain joint investment trusts; and warrants or improvement certificates of a drainage district. The City classifies its investments into categories which present an indication of the level of credit risk in relation to the nature of the investment and the custodial provisions. Category 1 records securities that are insured, registered, held by the City, or held by the City's agent in the City's name. Category 2 denotes uninsured and unregistered securities that are held by a counterparty's trust department or agent in the City's name. Category 3 specifies uninsured and unregistered securities that are held by a countcrparty's trust department or agent in other than the City's name. 54 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 The following is a summary of the City's investments, including restricted assets, at June 30, 2004: Category_ Fair 1 2 3 Value U.S. Goverment Securities $ 4.015.08~0 $ $ $ 4,015,080 Investments not subject to categorization: Mutual funds 171,546 Iowa Public Agency Investment Trust 4,147,819 Total Investments $ 8,334,445 The aforementioned Iowa Public Agency Investment Trust (IPAIT) and mutual funds represent investments in pools managed by others. IPAIT is a common trust established under Iowa law pursuant to Iowa Code Chapter 28E in 1987 to enable eligible Iowa public agencies to safely and effectively invest their available operating and reserve funds. IPAIT is registered under the Investment Company Act of 1940. The IPAIT portfolios have followed established money market mutual fund investment parameters designed to maintain a $1 per unit net asset value since inception and were registered with the Securities and Exchange Commission (SEC). 4. Interfund Balances and Transfers Interfund balances for the year ended June 30, 2004, consisted of the following: Advances from General Sanitation Total Advances to: General $ $ 491,409 $ 491,409 Capital projects - other 42,233 42,233 Nonmajor governmental 47,695 - 47,695 Nonmajor enterprise 64,888 983,711 1,048,599 Total $ 112.583 $ 1.517.35~33 $ 1.629.93~66 Interfund balances at June 30, 2004, include advances due to/from other funds. Advances to/from other funds represent amounts for construction loans and negative cash funding. $946,705 of the $983,711 and $218,966 of the $491,409 advances are not expected to be repaid within the next year. None of the $42,233 advance is expected to be repaid within the next year. 55 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) Jtme 30, 2004 Interfund transfers for the year ended June 30, 2004, consisted of the following: Transfer From Employee Capital Projects - Nonmajor Wastewater Transfer to: General Benefits Other Governmental Treatment General $ $ 7,102,703 $ $ 3,016,837 $ Capital projects - other 80,612 3,742 Nonmajor governmental 129,701 1,932,941 1,389,893 Wastewater treatment 35,431 50,859 Water 1,094,266 Nonmajor enterprise 183,000 853,730 580,703 6,042 Internal service 23,826 254,986 Total transfer to $ 417~139 $ 7.10~2.70~3 $ 4.171~.354 $ 5.04234 $ 6.042 (continued) Transfers are used to move revenues and bond proceeds from the fund that State statutes or the budget requires them to be collected into the fund that the State statutes or the budget requires them to be expended. 56 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Transfer From Nonmajor Internal Total Water Sanitation Housing Enterprise Service Transfer From $ $ $ $ 378,484 $ 127 $ 10,498,151 174,023 318,674 577,051 55,293 32,005 3,539,833 - 86,290 1,094,266 1,623,475 58,099 194,945 8,376 540,232 $ 232.122 $ 250.238 $ 8,376 $ 729,163 $ 127 5; 17.959~298 57 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 5. Capital Assets There were several adjustments to beginning capital assets. The City started a Stormwater Fund. Various governmental capital assets were transferred into this new fund. Also it was discovered that land being used as a parking lot was incorrectly recorded in the Parking Fund rather than the general capital assets. Effect of Beginning Effect of Recording July 1, 2003 Starting Parking Beginning as Previously Stormwater Lot in the July 1, 2003 Reported Fund Proper Fund as Restated Governmental activities: Land $ 13,704,160 $ (2,130,138) $ 212,112 $ 11,786,134 Construction in progress 21,800,012 (1,272,359) 20,527,653 Infrastructure 92,485,279 (25,057,363) 67,427,916 Accumulated depreciation - infrastructure 14,667,029 (3,337,029) 11,330,000 Business-type activities: Land 20,309,298 2,130,138 (212,112) 22,227,324 Construction in progress 3,694,452 1,272,359 4,966,811 Infrastructure 124,017,216 25,057,363 149,074,579 Accumulated depreciation - infrastructure 28,201,208 3,337,029 31,538,237 Capital asset activity for the year ended June 30, 2004, was as follows: Beginning Acquisitions Disposals Balance July 1, 2003 and and June 30, as Restated Transfers Transfers 2004 Governmental activities: Capital assets, not being depreciated: Land $ 11,786,134 $ 870,120 $ 275,532 $ 12,380,722 Construction in progress 20,527,653 16,006,285 25,238,666 11,295,272 Total capital assets, not being depreciated 32,313,787 16,876,405 25,514,198 23,675,994 Capital assets, being depreciated: Buildings 27,322,672 16,907,236 44,229,908 Improvements other than buildings 3,269,619 466,474 3,736,093 Machinery and equipment 26,195,244 3,426,947 1,031,139 28,591,052 Infrastructure 67,427,916 6,426,971 73,854,887 Total capital assets being depreciated 124,215,451 27,227,628 1,031,139 150,411,940 Less accumulated depreciation for: Buildings 9,190,261 1,136,505 10,326,766 Improvements other than buildings 667,679 130,483 798,162 Machinery and equipment 15,077,681 3,151,383 863,469 17,365,595 Infrastructure 11,330,000 1,679,287 13,009,287 Total accumulated depreciation 36,265,621 6,097,658 863,469 41,499,810 58 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Beginning Acquisitions Disposals Balance July 1, 2003 and and June 30, as Restated Transfers Transfers 2004 Total capital assets, being depreciated, net $ 87,949,830 $ 21,129,970 $ 167,670 $108,912,130 Governmental activities capital assets, net ~ $ 38.006.37~5 ~ ~ Business-type activities: Capital assets, not being depreciated: Land $ 22,227,324 $ $ $ 22,227,324 Construction in progress 4,966,811 3,873,447 4,577,847 4,262,411 Total capital assets, not being depreciated 27,194,135 3,873,447 4,577,847 26,489,735 Capital assets, being depreciated: Buildings 122,425,130 679,761 4,017,078 119,087,813 Improvements other than buildings 9,978,921 451,743 22,762 10,407,902 Machinery and equipment 21,393,973 427,346 904,736 20,916,583 Infrastructure 149,074,579 5,266,776 58,418 154,282,937 Total capital assets being depreciated 302,872,603 6,825,626 5,002,994 304,695,235 Less accumulated depreciation for: Buildings $ 28,452,500 $ 3,356,640 $ 3,768,188 $ 28,040,952 Improvements other than buildings 628,628 426,146 22,762 1,032,012 Machinery and equipment 6,267,559 1,149,854 830,405 6,587,008 Infrastructure 31,538,237 3,894,408 22,669 35,409,976 Total accumulated depreciation 66,886,924 8,827,048 4,644,024 71,069,948 Total capital assets, being depreciated, net 235,985,679 (2,001,422) 358,970 233,625,287 Business-type activities capital assets, net ~ $ 1.872.02~5 $ 4,936.817 $260.115.~022 Depreciation expense was charged to functions as follows: Governmental activities: Public safety $ 527,515 Public works 2,088,224 Culture and recreation 1,833,277 Community and economic development 20,539 General govemment 327,195 Total depreciation expense -govemmental activities 5; 4.796.75~0 Business-type activities: Wastewater treatment $ 4,133,893 Water 1,887,583 Sanitation 946,610 Housing authority 229,604 Nonmajor enterprise 1,629,358 Total depreciation expense - business-type activities 5; 8.827.048 59 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 6. Bonded and Other Long-Term Debt Changes in Long-term Liabilities Long-term liability activity for the year ended June 30, 2004, was as follows: July 1, June 30, Due Within 2003 Issues Retirements 2004 One Year Governmental activities: General obligation bonds $ 71,641,169 $ 12,875,000 $ 5,171,569 $ 79,344,600 $ 9,349,222 Plus: Unamortized Premium (discount) 85,688 (19,474) 7,607 58,607 7,607 Total general obligation bonds 71,726,857 12,855~526 5,179,176 79,403,207 9,356,829 Employee vested benefits 1,550,381 920,942 749,423 1,721,900 850,665 $ 73~277~238 $ 13.776.46~8_8 $ 5~.928:599 $ 81.125.10~77 $ 10.20794 Business-type activities: General obligation bonds $ 11,358,831 $ $ 1,718,431 $ 9,640,400 $ 1,365,779 Less: Unamortized discounts 84,844 6,609 78,235 6,609 Total general obligation bonds 11,273,987 1,711,822 9,562,165 1,359,170 Revenue bonds 120,310,000 4,600,000 115,710,000 4,780,000 Less: Unamortized discounts I~155,860 72,050 1,083~810 72~050 Total revenue bonds 119354~140 4,527,950 114,626~190 4~707,950 Landfill closure/post- closure 7,540,200 335,679 - 7,875,879 - Employee vested benefits 464,885 147,753 225,938 386,700 189,260 $138.433.~212 $ 483.432 $ 6,465.710 $132.450.93~44 $ 6.256.38~0 For the governmental activities, employee vested benefits are generally liquidated by the General Fund and Community Development Block Grant Fund. General Obligation Bonds Various issues of general obligation bonds totaling $88,985,000 are outstanding as of June 30, 2004. The bonds have interest rates ranging from 2.5% to 5.5% and mature in varying annual amounts ranging from $275,000 to $2,195,000 per issue, with the final maturities due in the year ending June 30, 2023. Interest and principal payments on all general obligation bonds, except tax abated portions recorded in the enterprise funds, are accounted for through the Debt Service Fund. 60 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Portions of several general obligation bond issues have been used to acquire or expand the enterprise fund facilities. In some instances, revenue generated by the enterprise funds is used to pay the general long- term debt principal and interest. The liability for those bonds that are expected to be paid by enterprise funds is included in those funds. Annual debt service requirements to maturity for general obligation bonds are as follows: Fiscal Year Ending Governmental Activities Business-type Activities June 30 Principal Interest Principal Interest 2005 $ 9,349,222 $ 3,676,318 $ 1,365,779 $ 372,426 2006 5,529,222 3,166,859 1,395,778 326,409 2007 5,525,525 2,952,953 1,429,475 284,314 2008 5,313,235 2,727,006 561,765 238,554 2009 5,448,235 2,507,834 561,765 216,001 2010-2014 26,409,412 8,969,871 3,070,586 707,384 2015-2019 16,579,749 3,590,062 1,255,252 104,210 2020-2023 5,190,000 541,079 - Total $ 79.344 ~~ $ 28.131.98~2 $ 9,640,400 $ 2.249.29~8 Revenue Bonds As of June 30, 2004, the following unmatured revenue bond issues are outstanding: Wastewater Parking Treatment Water Original issue amount $ 13,850,000 $ 83,935,000 $ 30,700,000 Interest rates 5.9% to 7.4% 3.5% to 5.8% 2.0% to 5.6% Annual maturities $ 305,000 to $ 270,000 to $ 245,000 to $ 895,000 $ 3,010,000 $ 910,000 Amount outstanding $ 11,350,000 $ 75,930,000 $ 28,430,000 Revenue bond debt service requirements to maturity are as follows: Fiscal Year Ending Business-type Activities June 30 Principal Interest 2005 $ 4,780,000 $ 5,541,021 2006 5,015,000 5,340,208 2007 5,155,000 5,128,064 2008 5,415,000 4,905,893 2009 5,625,000 4,668,765 2010-2014 30,140,000 19,222,962 2015-2019 28,830,000 12,213,628 2020-2024 25,820,000 4,359,862 2025-2026 4,930,000 235,032 $ 115.710._~000 $ 61.615.43~5 61 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 The revenue bond ordinances required that wastewater treatment, parking system, and water revenues be set aside into separate and special accounts as they are received. The use and the amounts to be included in the accounts are as follows: Account Amount (a) Revenue Bond and Interest Amount sufficient to pay current bond and interest maturities. Sinking Reserve (b) Revenue Debt Service Reserve Amount required to be deposited in the Revenue Bond and Interest Reserve until the reserve fund equals: Parking Revenue and Water Revenue bonds - maximum debt service due on the bonds in any succeeding fiscal year. Wastewater Revenue bonds- 125% of the average principal and interest payments over the life of all the Wastewater Revenue bonds. (c) Improvement Reserve $20,000 per month until the reserve balance equals or exceeds $2,000,000 for Wastewater Revenue bonds, $5,000 per month until the reserve balance equals or exceeds $300,000 for Parking Revenue bonds and $450,000 for Water Revenue bonds, with no further deposits once the minimum balance is reached. If the reserve falls below the required minimum, monthly transfers in the aforementioned amounts will resume. Summary of Bond Issues General obligation and revenue bonds payable at June 30, 2004, are comprised of the following issues: Date of Amount Interest Final Outstanding Issue Issued Rates Maturity June 30, 2004 General Obligation Bonds: Multi-Purpose and Water Construction (1) Mar. 1996 $ 6,100,000 3.6 - 5.5 6/05 $ 4,200,000 Multi-Purpose Mar. 1997 5,200,000 4.5 - 4.7 6/07 1,525,000 Water Construction (1) Nov. 1997 5,540,000 4.875 - 5.0 6/17 3,875,000 Multi-Purpose Apr. 1998 8,500,000 4.35 - 4.75 6/13 5,050,000 Multi-Purpose Mar. 1999 9,000,000 4.125 - 4.7 6/18 6,650,000 Multi-Purpose Jul. 2000 14,310,000 5.0- 5.5 6/18 12,215,000 Multi-Purpose Jan. 2001 11,500,000 4.0-4.9 6/16 9,615,000 Multi-Purpose and Library Construction May 2002 29,100,000 3.5 - 5.0 6/21 25,930,000 Refunded Multi-Purpose (3) Oct. 2002 10,600,000 2.5 - 4.0 6/15 7,050,000 Multi-Purpose Nov. 2003 5,570,000 2.5 - 3.6 6/14 5,570,000 Taxable - Urban Renewal Mar. 2004 7,305,000 4.0 - 5.4 6/23 7,305~000 Total General Obligation Bonds 88~985~000 62 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Date of Amount Interest Final Outstanding Issue Issued Rates Maturity June 30, 2004 Revenue Bonds: Parking Bonds Dec. 1999 $ 11,350,000 5.875 - 6.0 7/24 $ 11,350,000 Wastewater Treatment Bonds Mar. 1996 18,300,000 5.0 - 5.75 7/21 15,575,000 Wastewater Treatment Bonds May 1997 10,600,000 5.15 - 5.5 7/22 9,150,000 Wastewater Treatment Bonds Jan. 1999 7,000,000 4.25 - 4.87 7/24 6,020,000 Wastewater Treatment Bonds Oct. 2000 12,000,000 5.125 - 5.5 7/25 11,125,000 Wastewater Treatment Bonds Dec. 2001 10,250,000 4.5 - 5.0 7/20 10,250,000 Refunded Wastewater Treatment Bonds (2) May 2002 25,785,000 3.25 - 4.1 7/13 23,810,000 Water Bonds May 1999 9,200,000 4.75 - 5.0 7/25 8,385,000 Water Bonds Dec. 2000 13,000,000 5.0 - 5.625 7/26 11,945,000 Water Bonds Oct. 2002 8,500,000 2.0 - 4.65 7/22 8,100,000 Total Revenue Bonds 115,710,000 $ 204.695.00~0 (1) These bond issues have a portion of the general obligation bonds payable shown as a liability on the balance sheet of the Water Fund. (2) This bond issue refunds the January 1993 Wastewater Revenue Bonds. (3) This bond issue has a portion of the general obligation bonds payable shown as a liability on the balance sheet of the Water Fund, Wastewater Fund, and Parking Fund. Conduit Debt Obligations From time to time, the City has issued Industrial Development Revenue Bonds and Facility Refunding Revenue Bonds to provide financial assistance to private sector entities for the acquisition, construction, and renovation of industrial and commercial facilities deemed to be in the public interest. The bonds are collateralized by the property financed and are payable solely from payments received on the underlying mortgage loans. All payments on the bonds are made by the private sector entities directly to a bond trustee, who is a third party financial institution, and in turn, disburses the payment to the respective bond holders. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of June 30, 2004, there was one series of Industrial Development Revenue Bonds and Facility Refunding Revenue Bonds outstanding, with an aggregate principal amount payable of $39,215,000. 63 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Debt Legal Compliance Legal Debt Margin: As of June 30, 2004, the general obligation debt issued by the City did not exceed its legal debt margin computed as follows: Assessed valuation: Real property $2,917,088,086 Utilities 58,166,019 Total valuation ~ Debt limit, 5% of total assessed valuation $ 148,762,705 Debt applicable to debt limit: General obligation bonds 85~085,000 Legal debt margin $ 63:677.705 7. Segment Information The City issued revenue bonds to finance construction of its parking facilities. Summary financial information for the parking department is presented below: Condensed Statement of Net Assets Assets: Current assets $ 1,581 Restricted assets 2,036 Capital assets 20,306 Total assets 23,923 Liabilities: Current liabilities 716 Noncurrent liabilities payable from restricted assets 340 Other noncurrent liabilities 11,564 Total liabilities 12,620 Net assets: Invested in capital assets, net of related debt 9,339 Restricted 1,392 Unrestricted 572 $ 11:303 64 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Condensed Statement of Revenues, Expenses, and Changes in Net Assets Operating revenue $ 4,103 Depreciation expense (870) Other operating expenses (2,319) Operating income 914 Nonoperating revenues (expenses): Interest income 61 Interest expense (707) Transfer out (527) Change in net assets (259) Beginning net assets (as restated) 11,562 Ending net assets $ 11.._303 Condensed Statement of Cash Flows Net cash flows from: Operating activities $ 1,787 Noncapital financing activities (227) Capital and related financing activities (1,914) Investing activities 57 Net decrease (297) Cash and cash equivalents, beginning (as restated) 3~448 Cash and cash equivalents, ending $ 3:151 8. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; workplace .accidents, errors and omissions; and natural disasters. During fiscal year 1988 the City established the Loss Reserve Fund, an internal service fund, to account for and finance its uninsured risks of loss. During the year ended June 30, 2004, the City purchased property, liability, and workers' compensation insurance under the program that provides for a $200,000 self-insured retention per occurrence on property losses, a $500,000 self-insured retention per occurrence on liability, and a $300,000 self-insured retention on workers' compensation losses, with an annual aggregate retention of $425,000 on property losses. The insurance provides coverage for claims in excess of the aforementioned self-insured retention up to a maximum of $10,000,000 annual aggregate of losses paid. The operating funds pay annual premiums to the Loss Reserve Fund. Accumulated monies in the Loss Reserve Fund are available to cover the self-insured retention amounts and any uninsured losses. Settled claims have not exceeded this commercial coverage in any of the past six fiscal years. 65 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 The Housing Authority Fund is insured under a separate policy with the Assisted Housing Risk Management Association. The remaining funds participate in the Loss Reserve Fund. The funds make payments to the Loss Reserve Fund based on actuarial estimates of the amounts needed to pay prior- and current-year claims and to establish a reserve for catastrophic losses. The Fund's accrued liabilities balance includes a claims liability at June 30, 2004, based on the requirements of GASB Statement No. 10, as amended, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. Changes in the Loss Reserve Fund's claims liability amount for property, liability, and workers' compensation for the years ended June 30, 2004 and 2003, are as follows: Current-Year Beginning-of- Claims and Balance at Fiscal-Year Changes in Claim Fiscal Liability Estimates Payments Year-End 2002-2003 $ 372,000 $ 658,000 $ 222,000 $ 808,000 2003 - 2004 808,000 464,000 464,000 808,000 Also, the City is partially self-insured, through stop-loss insurance, for employee health care coverage, which is available to all of its permanent employees. This insurance provides stop-loss coverage for claims in excess of $50,000 per employee with an aggregate stop-loss of $4,331,969. For the year ended June 30, 2003, the aggregate stop-loss was approximately $4,046,000; otherwise, there was no change in coverage from the prior year. The operating funds are charged premiums by the Loss Reserve Fund. The City reimburses a health insurance provider for actual medical costs incurred, plus a claims processing fee. Changes in the Loss Reserve Fund's claims liability amount for health care coverage for the years ended June 30, 2004 and 2003, are as follows: Current-Year Beginning-of- Claims and Balance at Fiscal-Year Changes in Claim Fiscal Liability Estimates Payments Year-End 2002-2003 $ 498,000 $ 3,577,000 $ 3,543,000 $ 532,000 2003 - 2004 532,000 4,552,000 4,421,000 663,000 66 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 9. Contractual Commitments and Contingencies The total outstanding contractual commitments as of June 30, 2004, are as follows: Fund Project Amount Bridge, street and traffic control construction Paving, sidewalk, and design consulting $ 654,028 Other construction Library expansion design and construction, park ampitheater and transportation center construction 6,894,162 Parking Parking ramp design construction 3,449 Wastewater treatment Sanitary sewer construction 402,766 Water Dam and pedestrian bridge construction 462,582 Sanitation Landfill consulting 274,092 Stormwater Storm sewer mapping and construction 57,242 Broadband Refranchising consulting 62,930 Economic development Hotel construction 5,326,914 $ 14.138~165 10. Contingent Liabilities Litigation The City is a defendant in a number of lawsuits arising principally from claims against the City for alleged improper actions by City employees, including improper police action, unlawful taking of property by zoning, negligence, appeals of condemnations, and discrimination. Total damages claimed are substantial; however, it has been the City's experience that such actions are settled for amounts substantially less than claimed amounts. The City's management estimates that the potential claims against the City, not covered by various insurance policies, would not materially affect the financial condition of the City. The City has the authority to levy additional taxes (outside the regular limit) to cover uninsured judgments against the City. 67 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 11. Pension and Retirement Systems Municipal Fire and Police Retirement System of Iowa The City is a participating employer in the Municipal Fire and Police Retirement System of Iowa (MFPRSI or the Plan), which is a cost-sharing multiple-employer defined benefit public police and fire employees retirement system. All fire fighters and police officers appointed under civil service participate in the Plan. The Plan provides retirement, disability, and death benefits that are established under state statute. The Plan issues a publicly available financial report that includes financial statements and required supplementary information. The report may be obtained by writing to Municipal Fire and Police Retirement System of Iowa, 2836 104th Street, Urbandale, Iowa 50322. A member may retire at age 55 with 22 years of employment, and receive full benefits that are equal to 66% of the member's average final compensation for a member retiring after July 1, 2000. Additionally, members retiring on or after July 1, 2000, with more than 22 years of service will receive an additional 2% of the member's average final compensation for up to 8 years of additional service. Other benefits are also calculated as varying percentages of the average final compensation. Benefits vest after four years of service. Member contribution rates are established by statute. For the fiscal year ended June 30, 2004, members contributed 9.35%. The City's contribution rate is based upon an actuarially determined normal contribution rate. The normal contribution rate is provided by state statute to be the actuarial liabilities of the Plan less current plan assets, the total then being divided by 1% of the actuarially determined present value of prospective future compensation of all members, further reduced by member contributions. Legislatively appropriated contributions from the state to the Plan may further reduce the City's contribution rate. However, the City's contribution rate may not be less than 20.48% of earnable compensation. For the year ended June 30, 2004, the City's contribution rate was 20.48% of earnable compensation of each member. The contributions paid by the City for the years ended June 30, 2002, 2003, and 2004, were $1,022,241, $1,059,538, and $1,335,065, respectively, and was equal to the required contributions for each year. Iowa Public Employees Retirement System The City contributes to the Iowa Public Employees Retirement System (IPERS), which is a cost-sharing multiple-employer defined benefit pension plan administered by the State of Iowa. IPERS provides retirement and death benefits, which are established by State statute to plan members and beneficiaries. IPERS issues a publicly available financial report that includes financial statements and required supplementary information. The report may be obtained by writing to IPERS, P.O. Box 9117, Des Moines, Iowa 50306-91 ! 7. All employees, except temporary employees of six months or less of employment duration, who do not participate in any other public retirement system in the state are eligible and must participate in lPERS. The pension plan provides retirement and death benefits that are established by state statute. Generally, a member may retire at the age of 65, or any time after age 62 and 26 years or more of service, or when age plus years of service equals or exceeds 88, and receive unreduced (for age) benefits. Members may also retire at the age of 55 or more at reduced benefits. Benefits vest after four years of service or after attaining the age of 55. Full benefits are equal to 60% of the average of the highest three years of covered wages times years of service divided by 30. 68 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 Plan members are required to contribute 3.70% of their annual covered salary and the City is required to contribute 5.75% of annual covered payroll. Contribution requirements are established by state statute. The City's contributions to IPERS for the years ended June 30, 2002, 2003, and 2004, were $1,116,333, $1,220,376, and $1,240,324, respectively, and were equal to the required contributions for each year. 12. Post-Employment Benefits All full-time employees who retire or become disabled are offered the following post-employment benefit options: Health insurance - The option of continuing with the City's health insurance plan at the individual's own cost. Life insurance - The option of converting the employee's City-paid policy from term insurance to whole life insurance at the individual's expense with the City's life insurance carrier. Long-term disability - The option of converting the employee's City-paid group policy to a personal policy at the individual's expense with the City's long-term disability insurance carrier. The above options, while at the individual's own expense, arc included within the City's overall insurance package. Therefore, a portion of the above coverages is being subsidized by the City and its current employees. However, the City cannot reasonably estimate the amount of this subsidy and it is being expensed as incurred by the City. 13. Landfill Closure and Postclosure Care Costs In August 1993, the GASB issued Statement No. 18, Accounting for Municipal Solid ~Vaste £andfill Closure and Postclosure Care Costs (the Statement). Under these rules, in addition to operating expenses related to current activities of the landfill, an expense provision and related liability are being recognized based on the future closure and postclosure care costs that will be incurred near or after the date the landfill no longer accepts waste. The recognition of these landfill closure and postclosure care costs is based on the amount of the landfill used during the year. The estimated liability for landfill closure and postclosure care costs as of June 30, 2004, is approximately $7,876,000, which is based on 67% usage (filled) of the landfill and is included in accrued liabilities within the Sanitation Fund. It is estimated that an additional amount of approximately $3,924,000 will be recognized as closurc and postclosure care expenses between the date of the balance sheet and the date the landfill is expected to be filled to capacity by the year ended June 30, 2019. The estimated total current cost of the landfill closure and postclosure care costs at June 30, 2004, was determined by engineers from Howard R. Green Company and approximated $11,800,000. It is based on the amount that would bc paid if all equipment, facilities, and services required to close, monitor, and maintain the landfill were acquired as of June 30, 2004. These amounts are based on an estimated postclosure care and monitoring period of 30 years, consistent with current State Department of Natural Resources regulations. However, the actual cost of closure and postclosure care may be higher due to inflation, changes in technology, or changes in landfill laws and regulations. 69 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) Jtme 30, 2004 The City is required by federal and state laws and regulations to provide some form of financial assurance to fmance closure and postclosure care. The City will meet its financial assurance obligations through the issuance of general obligation bonds. As of June 30, 2004, the Sanitation Fund had $8,099,236 in related equity in pooled cash and investments, at fair value designated for satisfaction of postclosure costs. The City estimates that these cash reserves will only provide a fraction of the dollars needed to close and monitor the landfill. The remaining portion of postclosure care costs, anticipated future inflation costs and additional costs that might arise fi'om changes in postclosure requirements (due to changes in technology or more rigorous environmental regulations, for example) may need to be covered by charges to future landfill users as well as City taxpayers. 14. Restatement of Beginning Balances The restatements of fund balances and net assets were due to the following: The City started a Stormwater Fund. Various assets and liabilities were put into this fund from various funds. During the recent system conversion, it was discovered that various assets and liabilities had not been recorded in the proper fund. Also during the conversion it was discovered that activity for some of the agency funds had been improperly recorded in the General Fund and Cable Television Fund. The system conversion also uncovered several amounts placed into escrow and developer deposits that should have been recorded as liabilities. Restatements of fund balances and net assets previously reported are as follows: (Amounts in thousands) Effect of Fund Balance/ Recording Effect of Net Assets Effect of Assets and Moving Effect of Fund Balance/ June 30, 2003, Starting Liabilities Assets and Recording Net Assets as Previously Stormwater in the Liabilities into Additional June 30, 2003, Fund Reported Fund Proper Funds Agency Funds Liabilities as Restated General $ 14,106 $ $ (160) $ (66) $ (553) $ 13,327 Bridge, street, and traffic control construction (1,526) 675 (851) Other shared revenue and grants 3,906 (272) 3,634 Parking 11,342 220 11,562 Stormwater 24,448 24,448 Cable television 1,780 (90) 1,690 Governmental activities 112,872 (25,123) 212 87,961 Business-type activities 169,246 24,448 220 (90) 193,824 70 CITY OF IOWA CITY, IOWA NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2004 15. New Governmental Accounting Standards Board (GASB) Standards The Governmental Accounting Standards Board (GASB) has issued five statements not yet implemented by the City. The statements, which might impact the City are as follows: Statement No. 40, Deposit and Investment Risk Disclosures issued March 2003, will be effective for the City for the fiscal year ending June 30, 2005. This statement addresses common deposit and investment risks related to credit risk, concentration of credit risk, interest rate risk, and foreign currency risk. Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries issued November 2003, will be effective for the City for the fiscal year ending June 30, 2006. This statement establishes accounting and financial reporting standards for impairment of capital assets and also clarifies and establishes accounting requirements for insurance recoveries. Statement No. 43, Financial Reporting for Postemployment Benefit Plans Other than Pension Plans issued April 2004, will be effective for the City for the fiscal year ending June 30, 2008. This statement establishes uniform financial reporting standards for other postemployment benefit (OPEB) plans and supersedes the interim guidance included in Statement No. 26. This statement affects reporting by administrators or trustees of OPEB plan assets or by employers or sponsors that include OPEB plan assets as trust or agency funds in their financial reports. Statement No. 44, Economic Condition Reporting: The Statistical Section issued May 2004, will be effective for the City for the fiscal year ending June 30, 2006. This statement amends previous guidance regarding preparation of the statistical section for governments that issue a comprehensive annual financial report. Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other than Pensions issued June 2004, will be effective for the City for the fiscal year ending June 30, 2009. This statement establishes standards for the measurement, recognition, and display of (OPEB) expense/expenditures and related liabilities (assets), note disclosures and, if applicable, required supplementary information (RSI) in the financial reports of state and local governmental employers. The City's management has not yet determined the effect these statements will have on the City's financial statements. 71 NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS Special Revenue Funds account for revenues derived from specific sources that are required to be accounted for as separate funds. The funds in this category and their purpose are as follows: Community Development Block Grant Fund - accounts for revenue from the U.S. Department of Housing and Urban Development's Community Development Block Grant programs. Other Shared Revenue and Grants Fund - accounts for revenue from various sources, primarily road use tax monies from the State of Iowa and reimbursable programs funded by federal and state grants. Economic Development Fund - accounts for revenue and expenditures of economic development activities. Johnson County Council of Governments Fund - accounts for the financial activities of the metropolitan/rural cooperative planning organization. CAPITAL PROJECTS FUNDS Capital Projects Funds are utilized to account for all resources used in the acquisition and construction of capital facilities and other major fixed assets, with the exception of those that are financed by proprietary fund monies. The fund in this category is as follows: Bridge, Street, and Traffic Control Construction Fund - accounts for the construction or replacement of infrastructure fixed assets, such as streets, bridges, dams, sidewalks, and lighting systems. 73 CITY OF IOWA CITY, IOWA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS June 30, 2004 (amounts expressed in thousands) Capital Special Revenue Projects Bridge, Community Other Johnson Street, and Development Shared County Traffic Block Revenue and Economic Council of Control Grant Grants Development Governments Construction Total Assets Equity in pooled cash and investments $ 11 $ 3,986 $ 5,242 $ 35 $ $ 9,274 Receivables: Accounts and unbilled usage 55 55 Interest 54 54 Notes 8,242 8,242 Due from other gnvemments 29 446 39 1,020 1,534 Total assets $ 8,282 $ 4,432 $ 5,296 $ 74 $ 1,075 $ 19,159 Liabilities and Fund Balances Liabilities: Accounts payable $ 12 $ I $ 188 $ I $ 56 $ 258 Contracts payable 232 626 858 Accrued liabilities 9 12 10 31 Advances from other funds 48 48 Deferred revenue 8,242 8 1,067 9,317 Total liabilities 8,263 I 420 21 1,807 10,512 Fund balances: Unreserved, undesignated 19 4,431 4,876 53 (732) 8,647 Total liabilities and fund balances $ 8,282 $ 4,432 $ 5,296 $ 74 $ 1,075 $ 19,159 74 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Capital Special Revenue Projects Bridge, Community Other Johnson Street, and Development Shared County Traffic Block Revenue and Economic Council of Control Grant Grants Development Governments Construction Total Revenues Property taxes $ $ $ 170 $ $ $ 170 Intergovernmental 786 5,402 300 245 914 7,647 Charges for services 26 26 Use of money and property I 80 81 Miscellaneous 337 1 3 35 376 Total revenues 1,124 5,403 550 248 975 8,300 Expenditures Current: Public works 13 803 816 Community and economic development 640 85 1,380 546 2,651 Capital outlay 688 232 5 2,738 3,663 Total expenditures 1,328 98 1,612 551 3,541 7,130 Excess (deficiency) of revenues over (under) expenditures (204) 5,305 (1,062) (303) (2,566) 1,170 Other Financing Sources (Uses) Proceeds from bond issuance 6,083 6,083 Proceeds from sale of capital assets 250 250 Premium (discount) on issuance of bonds (49) (49) Transfers in 320 3,219 3,539 Transfers out (4,508) (534) (5,042) Total other financing sources and (uses) 250 (4,508) 6,034 320 2,685 4,78 l Excess of revenues and other financing sources over expenditures and other financing uses 46 797 4,972 17 119 5,951 Fund Balances, Beginning (as restated) (27) 3,634 (96) 36 (851) 2,696 Fund Balances, Ending $ 19 $ 4,431 $ 4,876 $ 53 $(732) $ 8,647 75 NONMAJOR ENTERPRISE FUNDS Enterprise Funds account for operations and activities of the City that are financed and operated in a manner similar to a private business enterprise, and where the costs of providing services to the general public on a continuing basis are expected to be financed or recovered primarily through user charges, or where the City has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. The funds in this category are as follows: Parking Fund - accounts for the operation and maintenance of the "on" and "off' street public parking facilities. Airport Fund - accounts for the operation and maintenance of the airport facility. Stormwater Fund - accounts for the operation and maintenance of the stormwater operation. Cable Television Fund - accounts for the operation and maintenance of the Broadband Telecommunications Commission that oversees the franchise agreement with the cable television company, including production and broadcasting on the government television channels. 77 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF NET ASSETS NONMAJOR ENTERPRISE FUNDS June 30, 2004 (amounts expressed in thousands) Cable Parking Airport Stormwater Television Total Assets Current assets: Equity in pooled cash and investments $ 1,115 $ $ $ 814 $ 1,929 Receivables: Accounts and unbilled usage 12 57 164 233 lnterest 10 10 Notes 444 444 Duc from other governments 115 115 Total current assets 1,581 115 57 978 2,731 Noncurrent assets: Restricted assets: Equity in pooled cash and investments 2,036 2,036 Capital assets: Land 3,938 7,975 2,130 14,043 Buildings and structures 25,039 3,352 741 29,132 Improvements other than buildings 415 415 Equipment and vehicles 278 184 126 588 Infrastructure 1,860 26,905 28,765 Accumulated depreciation (8,994) (2,597) (3,868) (150) (15,609) Construction in progress 45 141 863 1,049 Total noncurrent assets 22,342 I 1,330 26,030 717 60,419 Total assets 23,923 11,445 26,087 1,695 63,150 Liabilities Current liabilities: Accounts payable 16 4 4 24 Contracts payable 86 3 89 Accrued liabilities 110 16 5 36 167 Advances from other funds 1,039 10 1,049 Bonded debt payable (net of unamortized discounts) 590 590 Total current liabilities 716 1,059 l 01 43 1,919 Noncurrent liabilities: Liabilities payable from restricted assets: lnterest payable 338 338 Deposits 2 2 4 Bonded debt payable (net of unamortized discounts) 11,564 11,564 Total noncurrent liabilities 11,904 2 I 1,906 Total liabilities 12,620 1,061 101 43 13,825 Net Assets Invested in capital assets, net of related debt 9,339 11,329 26,030 717 47,415 Restricted by bond ordinance 1,277 1,277 Restricted for future improvements 115 115 Unrestricted 572 (945) (44) 935 518 Total net assets $ 11,303 $ 10,384 $ 25,986 $ 1,652 $ 49,325 78 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS NONMAJOR ENTERPRISE FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Cable Parking Airport Stormwater Television Total Operating Revenues: Charges for services $ 4,011 $ 213 $ 104 $ 673 $ 5,001 Miscellaneous 92 1 93 Total operating revenues 4,103 213 104 674 5,094 Operating Expenses: Personal services 1,460 124 8 388 1,980 Commodities 204 12 21 237 Services and charges 655 191 113 100 1,059 2,319 327 121 509 3,276 Depreciation 870 188 531 40 1,629 Total operating expenses 3,189 515 652 549 4,905 Operating income (loss) 914 (302) (548) 125 189 Nonoperating Revenues (Expenses): Interest income 61 7 68 Interest expense (707) (707) Total nonoperating revenues (expenses) (646) 7 (639) Income (loss) before transfers 268 (302) (548) 132 (450) Capital contributions 116 717 833 Transfers in 223 1,401 1,624 Transfers out (527) (32) (170) (729) Change in net assets (259) 37 1,538 (38) 1,278 Net Assets, Beginning (as restated) 11,562 10,347 24,448 1,690 48,047 Net Assets, Ending $ 11,303 $ 10,384 $ 25,986 $ 1,652 $ 49,325 79 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF CASH FLOWS NONMAJOR ENTERPRISE FUNDS For the Year Ended June 30, 2004 (amounts expressed in thousands) Cable Parking Airport Stormwater Television Total Cash Flows From Operating Activities Receipts from customers and users $ 4,103 $ 136 $ 47 $ 663 $ 4,949 Payments to suppliers (867) (222) (765) (118) (1,972) Payments to employees (1,449) (122) (4) (386) (1,961) Net cash flows from operating activities 1,787 (208) (722) 159 1,016 Cash Flows From Noncapital Financing Activities Operating transfers from other funds 223 1,401 1,624 Operating transfers to other funds (227) (170) (397) Net cash flows from noncapital financing activities (227) 223 1,401 (170) 1,227 Cash Flows From Capital and Related Financing Activities Capital grants received 116 116 Repayment of advances from other funds (121) (1) (122) Acquisition and construction of property and equipment (521) (10) (678) (40) (1,249) Principal paid on bonded debt (671) (671) lnterest paid on bonded debt (722) (722) Net cash flows from capital and related financing activities (1,914) (15) (679) (40) (2,648) Cash Flows From Investing Activities Interest on investments 57 10 67 Net increase (decrease) in cash and cash equivalents (297) (41) (338) Cash and Cash Equivalents, Beginning (as restated) 3,448 855 4,303 Cash and Cash Equivalents, Ending $ 3,151 $ $ $ 814 $ 3,965 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss) $ 914 $ (302) $ (548) $ 125 $ 189 Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 870 188 531 40 1,629 Changes in: Receivables: Accounts and unbilled usage (2) (57) (l l) (70) Due from other governments (79) (79) Accounts payable (8) (l 9) (652) 3 (676) Accrued liabilities I 1 2 4 2 19 Deposits 2 2 4 Total adjustments 873 94 (174) 34 827 Net cash flows from operating activities $ 1,787 $ (208) $ (722) $ 159 $ 1,016 80 INTERNAL SERVICE FUNDS Internal Service Funds account for goods and services provided by one department to other City departments on a cost-reimbursement basis. The funds in this category are: Equipment Maintenance Fund - accounts for the provision of maintenance for City vehicles and equipment and vehicle rental to other City departments from a central vehicle pool. Central Services Fund - accounts for the support services of photocopying, paper supplies, mail, overnight shipping, and two-way radios provided to other City depat hiients. Loss Reserve Fund - accounts for the property, liability, Workers' Compensation and health insurance premiums and claims activity for City departments, including the self-insured retention portion. Information Technology Fund - accounts for the accumulation and allocation of costs associated with telecommunications and data processing, including the operation and replacement of equipment. 81 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS June 30, 2004 (amounts expressed in thousands) Equipment Centxal Loss Information Maintenance Services Reserve Technolosy Total Assets Current assets: Equity in pooled cash and investments $ 3,416 $ 239 $ 4,502 $ 1,696 $ 9,853 Receivables: Accounts and unbilled usage 54 54 Interest 15 1 19 7 42 Due from other governments 44 44 Inventories 210 210 Total current assets 3,685 240 4,575 1,703 10,203 Noncurrent assets: Restricted assets: Equity in pooled cash and investments 1 1 Capital assets: Land 45 45 Buildings and structures 578 254 832 Improvements other than buildings 50 50 Equipment and vehicles 9,756 257 1,219 11,232 Infrastructure 940 940 Accumulated depreciation ' (5,929) (115) (616) (6,660) Total noncurrent assets 4,501 142 1,797 6,440 Total assets 8,186 382 4,575 3,500 16,643 Liabilities Accounts payable 84 9 290 23 406 Accrued liabilities 72 2 1,477 57 1,608 Total liabilities 156 I l 1,767 80 2,014 Net Assets Invested in capital assets, net of related debt 4,500 142 1,797 6,439 Unrestricted 3,530 229 2,808 1,623 8,190 Totalnet assets $ 8,030 $ 371 $ 2,808 $ 3,421) $ 14,629 82 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS INTERNAL SERVICE FUNDS For the Year Ended June 30, 2004 (amounts expressed in thousands) Equipment Central Loss Information Maintenance Services Reserve Technology Total Operating Revenues: Charges for services $ 2,797 $ 241 $ 5,874 $ 1,987 $ 10,899 Miscellaneous 2 2 4 Total operating revenues 2,797 243 5,874 1,989 10,903 Operating Expenses: Personal services 653 23 94 549 1,319 Commodities 873 20 I 206 1,100 Services and charges 281 159 5,762 1,035 7,237 1,807 202 5,857 1,790 9,656 Depreciation 1,027 33 242 1,302 Total operating expenses 2,834 235 5,857 2,032 10,958 Operating income (loss) (37) 8 17 (43) (55) Nonoperating Revenues (Expenses): Gain on disposal of equipment 28 28 Interest income 6 2 40 19 67 Total nonoperating revenues 34 2 40 19 95 Income (loss) before capital contributions and transfers (3) 10 57 (24) 40 Transfers in 277 263 540 Change in net assets 274 10 57 239 580 Net Assets, Beginning 7,756 361 2,751 3,181 14,049 Net Assets, Ending $ 8,030 $ 371 $ 2,808 $ 3,420 $ 14,629 83 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Equipment Central Loss Information Maintenance Services Reserve Technology Total Cash Flows From Operating Activities Receipts from customers and users $ 2,774 $ 243 $ 5,820 $ 2,151 $ 10,988 Payments to suppliers ( 1,111 ) (172) (5,750) ( 1,258) (8,291 ) Payments to employees (644) (22) 40 (541) (1,167) Net cash flows from operating activities 1,019 49 110 352 1,530 Cash Flows From Noncapital Financing Activities Operating transfers from other funds 277 263 540 Cash Flows From Capital and Related Financing Activities Acquisition and construction of property and equipment (1,061 ) (18) (173) (1,252) Proceeds from sale of property 152 152 Net cash flows from capital and related financing activities (909) (18) (173) (1,100) Cash Flows From Investing Activities Interest on investments 4 3 38 17 62 Net increase in cash and cash equivalents 391 34 148 459 1,032 Cash and Cash Equivalents, Beginning 3,026 205 4,354 1,237 8,822 Cash andCash Equivalents, Ending $ 3,417 $ 239 $ 4,502 $ 1,696 $ 9,854 Reconciliation of operating income (loss) to net cash flows from operating activities: Operating income (loss) $ (37) $ 8 $ 17 $ (43) $ (55) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation expense 1,027 33 242 1,302 Changes in: Receivables: Accounts and unbilled usage 22 (54) (32) Due from other governments (44) 162 118 Inventories (1) (I) Accounts payable 43 7 13 (17) 46 Accrued liabilities 9 I 134 8 152 Total adjustments 1,056 41 93 395 1,585 Net cash flows from operating activities $ 1,019 $ 49 $ 110 $ 352 $ 1,530 84 AGENCY FUNDS The Agency Funds account for assets held by the City in a Irustee or custodial capacity for other entities, such as individuals, private organizations, or other governmental units. The funds in this category are: Project Green Fund - accounts for donations that are received to plant and develop yards and lawns, both public and private, within Iowa City. Library Foundation - accounts for donations that are made to support the library development office. Parks and Recreation Foundation - accounts for donations that are received for park improvements. PATV - accounts for investments made on behalf of Public Access Television. 85 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS For the Year Ended June 30, 2004 (amounts expressed in thousands) Balance July 1, 2003 Balance (as restated) Increases Decreases June 30, 2004 Project Green Assets Equity in pooled cash and investments $ 285 $ 5t $ 85 $ 251 Interest receivable 1 1 1 1 Total assets $ 286 $ 52 $ 86 $ 252 Liabilities Accountspayablc $ 16 $ 18 $ 16 $ 18 Due to agency 270 34 70 234 Total liabilities $ 286 $ 52 $ 86 $ 252 Library Foundation Assets Equity in pooled cash and investments $ 17 $ 32 $ 48 $ 1 Accounts receivable 1 19 1 19 $ 18 $ 51 $ 49 $ 20 Liabilities Accounts payable $ 17 $ 16 $ 17 $ 16 Accrued liabilities 1 4 1 4 Due to agency - 31 31 Total liabilities $ 18 $ 51 $ 49 $ 20 Parks and Recreation Foundation Assets Equity in pooled cash and investments $ 49 $ I $ $ 50 Liabilities Accounts payable $ 49 $ I $ $ 50 (continued) 86 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES (continued) AGENCY FUNDS For thc Year Ended June 30, 2004 (amounts expressed in thousands) Balance July l, 2003 Balance (as restated) Increases Decreases June 30, 2004 PATV Assets Equity in pooled cash and investments $ 90 $ 185 $ 181 $ 94 Liabilities Due to agency $ 90 $ 185 $ 181 $ 94 Total Agency Funds Assets Equity in pooled cash and investments $ 441 $ 269 $ 314 $ 396 Accounts receivable 1 19 1 19 Interest receivable 1 1 1 1 Total assets $ 443 $ 289 $ 316 $ 4!6 Liabilities Accounts payable $ 82 $ 35 $ 33 $ 84 Accrued liabilities 1 4 1 4 Due to agency 360 250 282 328 Total liabilities $ 443 $ 289 $ 316 $ 416 87 CITY OF IOWA CITY, IOWA GOVERNMENT-WIDE EXPENSES BY FUNCTION (amounts expressed in thousands) Fiscal Year Culture Community Interest on Ended Public Public and and Economic General Long-Term June 30 Safety Works Recreation Development Government Debt Airport 2003 $ 13,844 $ 11,539 $ 10,131 $ 3,133$ 6,251 $ 3,662 $ 431 2004 15,015 10,423 12,051 2,580 6,527 3,440 515 Housing Wastewater Cable TV Authority Parking Sanitation Treatment Water Stormwater Total 2003 $ 687 $ 6,519$ 3,554 $ 4,082 $ 12,086 $ 7,861 $ $ 83,780 2004 549 7,219 3,898 6,103 12,344 8,011 652 89,327 89 CITY OF IOWA CITY, IOWA GOVERNMENT-WIDE REVENUES (amounts expressed in thousands) PROGRAM REVENUES GENERAL REVENUES Gain on l~scal Year Operating Capital Disposal of Unrestricted Ended Charges for Grants & Grants & Capital Investment June 30 Services Contributions Contributions Taxes Assets Earnings Miscellaneous Total 2003 $ 39,366 $ 9,624 $ 3,922 $38,811 $ $ 1,090 $ 4,168 $ 96,981 2004 40,177 9,109 8,451 41,093 1,074 2,047 4,081 106,032 90 CITY OF IOWA CITY, IOWA GENERAL GOVERNMENTAL* EXPENDITURES BY FUNCTION AND TRANSFERS TO OTHER FUNDS Last Ten Fiscal Years (amounts expressed in thousands) General Fund Fiscal Year Home and Ended Community Human Community Policy and Capital June 30 ProtectionI Development2 Environment3 Administration4 Outlay 1995 $ 8,776 $ 5,558 $ 2,655 $ 4,354 $ 660 1996 9,389 5,849 2,876 4,682 2,181 1997 9,524 6,299 3,252 4,860 1,005 1998 10,310 6,405 3,245 5,477 1,451 ** 1999 10,991 6,552 3,606 5,232 2,232 2000 12,085 7,765 4,499 5,453 2,900 2001 12,337 8,268 5,316 5,493 1,318 *** 2002 13,181 8,459 3,856 5,838 1,089 Notes: * General Fund, Special Revenue Funds and Debt Service Fund. ** In FY99, Housing Authority was reported as an Enterprise Fund. *** In FY02, Economic Development was added to the Special Revenue Funds. llncludes Police, Fire, Housing and Inspection Services and Traffic Engineering. 2Includes Recreation, Library, Senior Center, Parks and Animal Control. 3Includes Engineering, Streets Maintenance, Forestry and Cemetery and Public Works Administration. 41ncludes Legislative, Executive, Financial Administration, Government Buildings, Escrows, Clearing Accounts and Planning and Community Development. Fiscal Year Culture Community and Ended Public Public and Economic General June 30 Safetys Work~6 Recreati°n7 Developments G°vernment9 2003 $ 13,115 $ 8,149 $ 8,061 $ 3,715 $ 5,887 2004 14,025 9,156 9,392 3,486 6,080 Notes: Includes all funds except for proprietary funds. SIncludes Police, Fire, Animal Control and Housing and Inspection Services. 61ncludes Recreation, Library, Senior Center, Cemetery and Parks. *Includes Engineering, Streets Maintenance, Traffic Engineering, Forestry, Transit and Public Works Administration. Slncludes Planning and Community Development, Community Development Block Grant and Johnson County Council of Governments. 9Includes Legislative, Executive, Financial Administration, Govemment Buildings, Escrows and Clearing Accounts. 92 Special Revenue Fonds Community Other Shared *** ** Development Revenue Employee Economic Housing Debt Transfers to Block Grant and Grants Benefits Development Authority Service Other Funds Total $ 1,674 $ 69 $ 238 $ $ 5,496 $ 2,367 $ 8,978 $ 40,825 2,615 150 159 6,450 2,519 9,744 46,614 1,758 66 210 4,392 1,963 12,361 45,690 2,235 117 178 4,591 2,727 10,575 47,311 1,802 265 215 3,490 11,466 45,851 1,550 157 145 4,278 13,895 52,727 1,968 226 259 5,304 13,409 53,898 1,941 98 371 3 5,735 12,891 53,462 Debt Capital Transfers Service Outlay to Other Funds Total $ 8,425 $ 20,095 $ 14,554 $ 82,001 8,508 16,065 16,733 $ 83,445 93 CITY OF IOWA CITY, IOWA GENERAL GOVERNMENTAL* REVENUES BY SOURCE AND TRANSFERS FROM OTHER FUNDS Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year Licenses Intergov- Ended Property and ernmental Charges for June 30 Taxes Permits Revenue Services 1995 $ 18,470 $ 605 $ 12,860 $ 2,689 1996 19,255 559 15,001 2,657 1997 ! 9,659 625 12,980 2,804 1998 20,635 651 12,881 2,488 ** 1999 22,153 676 8,372 2,807 2000 24,271 707 9,158 2,850 2001 27,071 689 11,793 2,895 2002 28,623 874 9,054 3,180 *** 2003 31,977 961 12,193 4,663 2004 35,538 1,361 12,058 3,240 Notes: Includes General Fund, Special Revenue Funds and Debt Service Fund. ** In FY99, Housing Authority was reported as an Enterprise Fund. *** In FY03, Transit became part of the General Fund. Also in FY03, Capital Projects Funds are included. 94 Use of Transfers Money and from Property Miscellaneous Other Funds Total $ 1,359$ 1,574 $ 6,133 $ 43,690 1,306 1,885 6,485 47,148 1,344 1,861 7,068 46,341 1,645 2,057 7,209 47,566 1,076 2,116 7,384 44,584 898 2,243 8,421 48,548 1,080 2,175 7,906 53,609 860 2,833 9,090 54,514 986 2,569 15,172 68,521 1,002 4,377 14,614 72,190 95 CITY OF IOWA CITY, IOWA PROPERTY TAX BUDGETS AND COLLECTIONS Last Ten Fiscal Years (Cash Basis) (amounts expressed in thousands) Percent of Total as Assessment Collection Total Tax Current Tax Budget Delinquent Tax Total Tax a Percent of Year Year Budgeted Collections Collected Collections Collections Current Budget 1993 1994-95 $ 18,484 $ 18,440 99.8 % $ 24 $ 18,464 99.9 % 1994 1995-96 19,264 19,234 99.8 14 19,248 99.9 1995 1996-97 19,766 19,765 100.0 17 19,782 100.1 1996 1997-98 20,807 20,521 98.6 8 20,529 98.7 1997 1998-99 21,735 21,842 100.5 22 21,864 100.6 1998 1999-00 23,945 23,989 100.2 5 23,994 100.2 1999 2000-01 26,089 25,684 98.4 31 25,715 98.6 2000 2001-02 27,920 28,423 101.8 5 28,428 101.8 2001 2002-03 31,975 31,863 99.6 16 31,879 99.7 2002 2003-04 34,073 34,009 99.8 23 34,032 99.9 CITY OF IOWA CITY, IOWA PROPERTY TAX RATES AND TAX DOLLARS BUDGETED Last Ten Fiscal Years Tax Rates~ Fiscal Agri- Year Total cultural Ended Employee Tort Debt City Land June 30 General Librarv Benefits Emereencv Liability Service Transit Tax Rate Tax Rate 1995 $ 8.100 0.270 $ 1.981 $ $ $ 1.661 $ 0.942 $ 12.954 $ 3.004 1996 8.100 0.270 1.963 1.709 0.950 12.992 3.004 1997 8.100 0.270 2.133 1.200 0.950 12.653 3.004 1998 8.100 0.270 2.026 1.704 0.950 13.050 3.004 1999 8.100 0.270 1.834 0.111 1.868 0.950 13.133 3.004 2000 8.100 0.270 2.009 0.222 2.300 0.950 13.851 3.004 2001 8.100 0.270 1.955 0.270 0.222 2.990 0.950 14.757 3.004 2002 8.100 0.270 2.111 0.270 0.206 2.945 0.949 14.850 3.004 2003 8.100 0.270 2.847 0.270 0.216 4.161 0.950 16.814 3.004 2004 8.100 0.270 3.192 0.270 0.244 4.570 0.950 17.596 3.004 Tax Dollars Budgeted2 Fiscal Year Agri- Ended Employee Tort Debt cultural June 30 General Library Benefits Emergency Liability Service Transit Land Total 1995 $ 11,549 $ 385 $ 2,824 $ $ $ 2,377 $ 1,343 $ 6 $ 18,484 1996 11,998 400 2,908 2,545 1,407 6 19,264 1997 12,637 421 3,327 1,892 1,482 7 19,766 1998 12,893 430 3,225 2,740 1,512 7 20,807 1999 13,380 446 3,030 183 3,120 1,569 7 21,735 2000 13,982 466 3,468 381 4,002 1,640 6 23,945 2001 14,296 477 3,451 477 392 5,312 1,677 7 26,089 2002 15,191 506 3,963 506 402 5,563 1,782 7 27,920 2003 15,391 513 5,409 513 410 7,927 1,805 7 31,975 2004 15,654 522 6,169 522 471 8,892 1,836 7 34,073 Notes: rate per $1,000 of taxable valuation. ZAmounts expressed in thousaads. CITY OF IOWA CITY, IOWA PROPERTY TAX, ROAD USE TAX AND HOTEL/MOTEL TAX REVENUES Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year Ended June 30 Property Tax Road Use Tax Hotel/Motel Tax Total 1995 $ 18,470 $ 3,637 $ 574 $ 22,681 1996 19,255 4,106 464 23,825 1997 19,659 4,253 427 24,339 1998 20,635 4,087 501 25,223 1999 22,153 4,575 570 27,298 2000 24,271 4,928 554 29,753 2001 27,071 4,852 497 32,420 2002 28,623 5,077 646 34,346 2003 31,966 5,103 559 37,628 2004 35,538 5,311 580 41,429 98 CITY OF IOWA CITY, IOWA ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY AND EXEMPT PROPERTY Last Ten Fiscal Years (.amounts expressed in thousands) Taxable Property Collection Assessed Value/ Assessment Year Ended Estimated Exempt January 1 June 30 Actual Value Property Value 1995 1997 $ 2,146,528 $ 98,450 1996 1998 2,185,167 111,672 1997 1999 2,373,523 114,154 1998 2000 2,423,557 123,068 1999 2001 2,597,827 128,115 2000 2002 2,699,944 136,493 2001 2003 2,920,580 137,713 2002 2004 2,975,254 152,991 2003 2005 3,214,973 155,407 2004 2006 3,322,001 176,188 Source: City of Iowa City Assessor's Office Notes: Property is reassessed in the odd numbered years to make adjustments to all property values, according to curren! market values. As per the Code of Iowa, all real and tangible personal property subject to taxation shall be valued at its actual value and, except as otherwise provided, shall be reassessed at 100% of its actual value, and the value so assessed shall be taken and considered as the assessed value and taxable value of the property upon which the levy shall be made. Taxable property includes real property, buildings and structures, industrial plant and fixtures, commercial equipment assessed as real property and utilities distribution property. Exempt property includes all property that is owned by religious and educational institutions, charitable and benevolent societies, low-rent housing and associations for war veterans. Each must apply for property tax exempt status with the City Assessor, who deten~nes if the property qualifies under state guidelines. Exempl property is assessed each year like other taxable property. Property owned by governmental entities is no! taxable and is not included in "Exempt Property." 99 CITY OF IOWA CITY, IOWA PROPERTY TAX RATES - ALL DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Fiscal Years (per $1,000 assessed valuation) Iowa City Kirkwood Ratio of Collection School City of Johnson Community State of Iowa City Year District Iowa City County! College Iowa Total to Total 1994-95 $ 12.338 $ 12.954 $ 6.431 $ 0.530 $ 0.005 $ 32.258 40.2 % 1995-96 12.634 12.992 5.790 0.593 0.005 32.014 40.6 1996-97 12.130 12.653 5.515 0.589 0.005 30.892 41.0 1997-98 12.220 13.050 5.414 0.595 0.005 31.284 41.7 1998-99 12.075 13.133 5.747 0.567 0.005 31.527 41.7 1999-00 11.696 13.851 5.947 0.613 0.005 32.112 43.1 2000-01 11.833 14.757 5.901 0.607 0.005 33.104 44.6 2001-02 11.540 14.850 5.802 0.607 0.005 32.803 45.3 2002-03 12.210 16.813 6.061 0.666 0.004 35.754 47.0 2003-04 12.865 17.596 6.102 0.679 0.004 37.246 47.2 Source: "Tax Levies for Johnson County, Iowa," compiled by the Johnson County Auditor. Note: ~Includes Johnson County, the City of Iowa City Assessor and Agricultural Extension levies. 100 CITY OF IOWA CITY, IOWA PRINCIPAL TAXPAYERS AND EMPLOYERS Fiscal Year Ended June 30, 2004 (amounts expressed in thousands) % of Total Taxable Assessed Ten lareest taxoavers~ Type of Business Valuation Valuation M~d-Amencan Energy Company Public Gas and Electric Utility $ 45,505 1.53 % James & Loretta Clark Apartments 26,937 0.91 ACT Inc. (formerly American College Testing Program) Educational Testing Service 22,409 0.75 Southgate Development Company Real Estate Developer 18,753 0.63 NCS Pearson Information Services 16,652 0.56 Procter & Gamble Manufacturing Company Personal Products Manufacturing 16,546 0.56 Hy Vee Grocery supermarket 14,186 0.48 Edwin & Ethel Barker & Barker Parmership Apartments 12,481 0.42 M G D LC (Sycamore Mall) Shopping Mall 10,991 0.37 Moen Group Real Estate Developer 10,295 0.35 Total ~ 6.5___~6 % Ten maior employers~ Employees University of Iowa 23,608 Iowa City Community School District 1,728 ACT Inc. (formerly American College Testing Program) 1,334 NCS Pearson 1,300 Veterans Administration Medical Center 1,200 Mercy Hospital 1,150 Hy-Vee 927 Lear Corporation 850 City of Iowa City 600 Gillette Canada (Oral B Laboratories) 500 Sources: ~City of Iowa City Assessor's Office-2003 Annual Report - Assessment January 1, 2003, payable 2005 ZState Department of Revenue ~Iowa Workforce Development and Iowa City Area Chamber of Commerce (including full- and part-time employees) 101 CITY OF IOWA CITY, IOWA SPECIAL ASSESSMENT COLLECTIONS Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year Special Special Ratio of Total Ended Assessments Assessments Collection to Outstanding June 30 Billed Collected Amount Billed Assessments 1995 $ 26 $ 44 169.2 $ 20 1996 36 50 138.9 225 1997 22 80 363.6 145 1998 17 31 182.4 114 1999 15 21 140.0 89 2000 15 32 213.3 57 2001 9 12 133.3 48 2002 9 9 100.0 35 2003 9 7 77.8 27 2004 9 9 100.0 18 Source: Johnson County Treasurer's Office Note: "Special Assessments Collected" includes amounts received on special assessments, past due assessments and future installments. 102 CITY OF IOWA CITY, IOWA RATIO OF NET GENERAL OBLIGATION BONDED DEBT1 TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA Last Ten Fiscal Years (amounts expressed in thousands, except per capita) Debt Payable from Proprietary Assessment and Net General Ratio of Net Net Bonded as of Assessed Gross Expendable Debt Service Obligation Bonded Debt to Debt Januar~ 1 Population Value2 Bonded Debt Trust Funds Fund Balance Bonded Debt Assessed Value Per Capita 1995 59,738 $ 2,146,528 $ 23,655 $ 12,993 $ 504 $ 10,158 4.73:1000 $ 170 1996 59,738 2,185,167 29,430 20,399 655 8,376 3.83:1000 140 1997 60,148 2,373,523 31,390 17,144 643 13,603 5.73:1000 226 1998 60,148 2,423,557 41,675 20,903 616 20,156 8.32:1000 335 1999 60,148 2,597,827 46,165 18,832 347 26,986 10.39:1000 449 2000 60,148 2,699,944 41,190 16,762 192 24,236 8.98:1000 403 2001 62,220 2,920,580 61,565 14,868 494 46,203 15.82:1000 743 2002 62,220 2,975,254 85,260 13,061 464 71,735 24.12:1000 1,153 2003 62,380 3,214,973 83,000 11,359 4,448 67,193 20.90:1000 1,077 2004 62,380 3,322,001 85,085 9,640 6,930 68,515 20.62:1000 1,098 Notes: ~General Obligation bonds. zobtained tSom the City of Iowa City Assessor's Office. CITY OF IOWA CITY, IOWA RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL BONDED DEBT TO TOTAL GENERAL GOVERNMENTAL* EXPENDITURES Last Ten Fiscal Years (amounts expressed in thousands) Total General Fiscal Year Governmental Ratio of Debt Ended Total Expenditures Service to General June 30 Principal Interest Debt Service and Transfers Expenditures 1995 $ 1,808 $ 559 $ 2,367 $ 40,825 .06:1.00 1996 1,939 580 2,519 46,614 .05: 1.00 1997 1,499 464 1,963 45,690 .04: 1.00 1998 1,988 739 2,727 47,311 .06: 1.00 1999 2,452 1,038 3,490 45,851 .08: 1.00 2000 2,918 1,360 4,278 52,727 .08: 1.00 2001 3,541 1,763 5,304 53,898 .10: 1.00 2002 3,599 2,136 5,735 53,462 .11: 1.00 ** 2003 4,742 3,683 8,425 82,001 .10: 1.00 2004 5,172 3,336 8,508 83,445 .10: 1.00 * General Fund, Special Revenue Funds and Debt Service Fund. ** Beginaing in FY03, Capital Projects Funds are also included. 104 CITY OF IOWA CITY, IOWA COMPUTATION OF DIRECT AND OVERLAPPING DEBT June 30, 2004 (amounts expressed in thousands, except per capita) Amount Total General % Applicable Applicable Long-Term to the to the Name of Bonded Debt City of City of Governmental Unit Outstanding Iowa City Iowa City Per Capita City of Iowa City $ 85,085 100.00% $ 85,085 $ 1,364 Iowa City Community School District 38,495 62.35% 24,002 385 Total $ 123,580 $ 109,087 $ 1,749 Per capita assessed value $ 47,69~6 Source: Johnson County Auditor's Office 105 CITY OF IOWA CITY, IOWA SCHEDULE OF REVENUE BOND COVERAGE Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year Net Revenue Annual Debt Service Ended Available for Ratio of June 30 Revenue Expenses~ Debt Service Principal Interest Total Coverage Parkinor, Revenue2 1995 $ 3,205 $ 1,543 $ 1,662 $ 295 $ 322 $ 617 2.69 1996 3,252 1,465 1,787 310 316 626 2.85 1997 3,338 1,950 1,388 330 218 548 2.53 1998 3,822 1,770 2,052 390 195 585 3.51 1999 3,653 1,713 1,940 415 168 583 3.33 2000 3,716 1,861 1,855 455 139 594 3.12 2001 4,309 2,176 2,133 485 836 1,321 1.61 2002 4,272 1,960 2,312 510 746 1,256 1.84 2003 4,198 1,953 2,245 375 715 1,090 2.06 2004 4,164 2,319 1,845 395 687 1,082 1.71 Wastewater Treatment Revenue3 1995 $ 7,244 $ 2,403 $ 4,841 $ 1,165 $ 2,292 $ 3,457 1.40 1996 9,656 2,506 7,150 1,230 2,205 3,435 2.08 1997 11,040 2,739 8,301 1,295 2,923 4,218 1.97 1998 11,066 2,809 8,257 1,490 3,382 4,872 1.69 1999 11,362 2,987 8,375 2,065 3,519 5,584 1.50 2000 11,872 3,259 8,613 2,160 3,691 5,851 1.47 2001 12,824 3,248 9,576 2,505 3,589 6,094 1.57 2002 12,501 3,389 9,112 3,005 4,236 7,241 1.26 2003 13,000 4,463 8,537 3,060 4,385 7,445 1.15 2004 12,947 4,523 8,424 3,280 3,672 6,952 1.21 Water Revenue4 1999 $ 8,571 $ 3,295 $ 5,276 $ $ $ 0.00 2000 9,626 3,384 6,242 299 299 20.88 2001 10,629 3,410 7,219 140 445 585 12.34 2002 10,179 3,428 6,751 705 1,175 1,880 3.59 2003 10,241 4,361 5,880 500 t,088 1,588 3.70 2004 10,627 4,360 6,267 925 1,427 2,352 2.66 Notes: ~Excludes depreciation and interest. 2Parking Revenue bonds ratio of"Net Revenue Available for Debt Service" to "Total Annual Debt Service" required to be at least 1.25. 3Wastewater Treatment Revenue bonds ratio of Net Revenue Available for Debt Servxce to "Total Annual Debt Service" is required to be at least 1.10. 4Water Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total Annual Debt Service" required to be at least 1.10. 106 CITY OF IOWA CITY, IOWA DEMOGRAPHIC STATISTICS Median Calendar Per Capita Median Family Education Retail Sales2 Year Population Income A~e Income Level~ (Anorox.) 1950 27,212 N/A 25.3 $ 3,245 68.1% $ 34,993,000 1960 33,443 $ 1,914 24.1 5,769 69.5 46,607,000 1970 46,850 3,025 22.6 9,942 82.1 84,322,000 1974 47,744 4,465 23.4 9,942 82.1 125,920,000 1980 50,508 7,247 24.6 22,325 89.5 215,305,000 1990 59,738 13,277 24.8 39,259 93.9 464,800,000 1996 60,148 N/A 24.8 N/A N/A 657,700,000 2000 62,380 20,269 25.4 57,568 94.8 756,100,000 U.S. Department of Commerce, Bureau of the Census of Population completing 12 years of formal schooling or more. Retail Sales & Usc Report, Iowa Department of Revenue and Finance. Not Available Fiscal Year School Enrollment Unemployment Ended June 30 Public3 Private4 Rates 1995 10,233 920 3.1 1996 10,448 921 2.7 1997 10,444 850 2.8 1998 10,562 868 2.4 1999 10,592 887 2.5 2000 10,619 924 2.0 2001 10,674 929 2.4 2002 10,785 912 3.2 2003 10,768 932 3.5 2004 10,943 942 4.0 City Community School District private schools Workforce Development Center 107 CITY OF IOWA CITY, IOWA PROPERTY VALUE, BUILDING PERMITS AND BANK DEPOSITS Last Ten Fiscal Years (dollar amounts expressed in thousands) Fiscal Year Property Value~ New Construction Ended Number Value June 30 Real Exempt of Permits of Permits2 1995 $ 2,146,528 $ 98,450 215 $ 40,481 1996 2,185,167 111,672 145 32,943 1997 2,373,523 114,154 161 45,339 1998 2,423,557 123,068 224 34,966 1999 2,597,827 128,115 320 45,381 2000 2,699,944 136,493 277 125,129 2001 2,920,580 137,713 191 79,329 2002 2,975,254 152,991 215 93,977 2003 3,214,973 155,407 275 65,829 2004 3,322,001 176,188 304 145,129 Notes: ~Source: Iowa City Assessor's Office 2Permit values are based on estimated construction costs. 3Local bank offices - Hills Bank & Trust Company, Commercial Federal Savings Bank, Iowa State Bank & Trust Company, West Bank, U S Bank, Farmers & Merchants Savings Bank, Wells Fargo, Federal Employees Credit Union and the University of Iowa Community Credit Union. 108 Remodeling Repair and Additons Total Building Permits Bank and Number Value Number Value Credit Union of Permits of Permits2 of Permits of Permits Deposits3 436 $ 10,915 651 $ 51,396 $ 854,155 478 10,249 623 43,192 928,208 512 12,536 673 57,875 1,050,620 739 14,880 963 49,846 1,073,583 579 22,618 899 67,999 1,140,367 678 28,677 955 153,806 1,183,757 579 25,101 770 104,430 1,107,410 577 24,660 792 118,637 1,060,390 606 44,336 881 110,165 1,140,410 654 39,840 958 184,969 1,267,156 109 CITY OF IOWA CITY, IOWA PARKING RATES Last Ten Fiscal Years Fiscal On-Street Off-Street CBD Peripheral Commercial Overtime Year End Meters Meters Meters: Ramps Lots~ Ramp Permits Parking June 30 (per hour) (per hour) (per hour) (per hour) (per month) (per month) Violation 1995 $ 0.30 $ 0.30 $ 0.50 $ 0.45 a $ 35 $ 45 a $ 3 0.50 4 55 4 0.30 s 35 s 1996 0.30 0.30 0.50 0.45 ~ 35 45 s 3 0.50 4 55 4 0.30 ~ 35 s 1997 0.40 0.40 0.60 0.50 a 40 45 a 3 0.50 4 55 4 0.40 s 45 s 1998 0.40 0.40 0.60 0.50 * 40 45 a 3 0.50 4 55 4 0.40 s 45 s 1999 0.40 0.40 0.60 0.50 a 40 45 a 3 0.50 4 55 4 0.40 ~ 45 5 2000 0.40 0.40 0.60 0.50 ~ 40 45 ~ 3 0.50 4 55 4 0.40 s 45 s 2001 0.40 0.60 0.60 0.60 3 45 50 3 3 0.60 4 60 4 0.50 s 45 s 0.60 6 60 6 2002 0.40 0.60 0.60 0.60 ~ 45 50 a 3 0.60 4 60 4 0.50 s 45 s 0.60 6 60 6 2003 0.40 0.60 0.60 0.60 3 45 50 3 3 0.60 4 60 4 0.50 5 45 s 0.60 6 60 6 2004 0.40 0.60 0.60 0.60 5 55 60 3 5 0.60 4 70 4 0.50 ~ 55 ~ 0.60 6 70 6 Notes: ~Employees of the City of Iowa City pay half-price for permits in the peripheral lots. :CBD refers to Central Business District. aDubuque Street Ramp. 4Capitol Street Ramp. SChauncey Swan Ramp. 6Tower Place Ramp. 110 CITY OF IOWA CITY, IOWA SCHEDULE OF LIABILITY AND PROPERTY INSURANCE IN FORCE June 30, 2004 Limits of Term of Annual Insurance Company Type of Coverage Coverage Policy Policy # Premium Genesis Insurance Company Comprehensive general liability, auto $10 million general 6/03-6/04 YXB300792C $758,022 liability, police professional liability, aggregate - occurrence; ZAB300789C workers' compensation, public officials $500,000 self-insured GDX014376C errors and omissions liability, retention (SIR) for liability and $300,000 SIR for workers' compensation. Blanket building and contents, contractor's $201,264,087 agreed amt. 6/03-6/04 equipment, EDP, auto physical damage, per occurrence; deductible flood and earthquake included at $15 million on property section is sub-limit. $200,000 per event and $425,000 aggregate Old Republic Airport premises liability and ground $5 million/combined single 6/03-6/04 PR163104 $7,798 Insurance Company hangarkeeper's legal liability, limit; $1 million/aircraft Cincinnati Insurance Company Boiler and machinery coverage at fifteen $25,000,000 aggregate; 6/03-6/06 BEP 2663128 $11,758 loc ations. $10,000 deductible Selective Insurance Company Flood coverage on property located in flood $5,000 deductible on 6/03-6/04 RI00541951/953/954/ $13,276 of Southeast zone A. building; $5,000 on 956/957/959/961 contents; maximum coverage-S500,000 per building and $500,000 contents per location. Assisted Housing Risk Public Housing Pool: general liability and $1 million per occurrence 1/04-1/05 P100188059 $14,212 Management Association property damage coverage, on liability/S2 million L 100188058 aggregate; $25 million on property damage Employee Dishonesty: Public employees dishonesty coverage $1,000,000 per occurrence 6/03-6/06 B-80 444877 $14,908 Cincinnati Insurance Company CITY OF IOWA CITY, IOWA MISCELLANEOUS STATISTICAL DATA Year ended June 30, 2004 Date of incorporation April 6, 1853 Form of government Council/Manager Area 16,602 acres Miles of streets: Paved (approx.) 251 Unpaved (approx.) 8 Number of street lights 3,352 Police protection: Number of stations 1 Number of sworn personnel 71 Fire protection: Number of stations 3 Number of sworn personnel 56 Municipal water department: Number of active accounts 23,077 Average daily consumption (in gallons) 5,742,000 Miles of water mains (approx.) 269 Sewers: Sanitary liR stations (active) 11 Miles of sanitary sewers (approx.) 274 Cemetery 1 Recreation: Municipal parks: Number of parks/public open spaces 61 Number of acres 1,400 Golf courses non-municipal 5 Other municipal facilities: Recreation Center 2 Ball diamonds 29 Soccer fields 25 Tennis courts 12 Swimming pools 3 Senior Center 1 Parking: Parking ramps/spaces 4/2,537 Parking lots/spaces 6/331 On-street meters 873 (continued) 112 CITY OF IOWA CITY, IOWA MISCELLANEOUS STATISTICAL DATA Year ended June 30, 2004 (concluded) Landfill: Number of charge customers 504 Tons (charge and cash) 108,155 Sanitation: Number of customers 13,983 Tons 8,716 Library: Number of volumes (approx.) 217,052 Registered cardholders 64,820 Educational Institutions': Elementary schools 18 Junior high schools 2 High schools 3 Alternative Learning Center 1 Vocational school 1 Community college 1 University 1 Hospitals 3 City Employees: Permanent 620 Temporary 706 Elections2: Last general election - 2002 Registered voters 42,556 Number of votes cast 20,818 Percentage voting 48.9% Last municipal election - 2003 Registered voters 38,849 Number of votes cast 8,101 Percentage voting 20.9% Source: lIowa City Community School District and local private school offices. 2Johnson County Auditor 113 CITY OF IOWA CITY, IOWA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 2004 Agency or Pass-through Program Grantor/Program CFDA Number Number Expenditures · · Direct: Department of Housing and Urban Development: Community Development Block Grants/ Entitlement Grants 14.218 B-02-MC-19-0009 $ 640,585 Community Development Block Grants/ Entitlement Grants 14.218 B:03-MC-19-0009 66,305... 706,890 HOME Investment Partnerships Program 14.239 M-01-MC-19-0205 105,130 HOME Investment Partnerships Program 14.239 M-03-MC-19-0205 109,064 HOME Investment Partnerships Program 14.239 M-00-MC- 19-0205 5,659 HOME Investment Partnerships Program 14.239 M-02-MC-19-0205 462,982 682,835 Public and Indian Housing 14.850 IA022-304J 167,759 Resident Opportunity and Supportive Services 14.870 IA00RSF022P0017 55,642 Section 8 Housing Choice Vouchers 14.871 KC9033 6,476,663 Public Housing Capital Fund 14.872 IA05902250101 98,025 Public Housing Capital Fund 14.872 IA05902250102 60,038 158,063 Department of Justice: Local Law Enforcement Block Grants Program 16.592 2001-LB-BX-1975 48,505 Local Law En,forcement Block Grants Program 16.592 2002-LB-BX-0986 42,045 90,550 Bulletproof Vest Partnership Program 16.607 2003BUBX03015610 1,869 Department of Transportation: Federal Transit-Capital Investment Grants 20.500 IA-03-0086 2,858,190 Federal Transit-Formula Grants 20.507 IA-90-X258 45,213 Federal Transit-Formula Grants 20.507 IA-90-X274 439,025 Federal Transit-Formula Grants 20.507 IA-90-X242 45,277 3,387,705 Airport Improvement Program 20.106 3-19-0047-10 89,139 Total direct 11,817,115 (continued) 119 CITY OF IOWA CITY, IOWA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (continued) YEAR ENDED JUNE 30, 2004 Agency or Pass-through Program Grantor/Program CFDA Number Number Expenditures Indirect: Department of Housing and Urban Development: Iowa Department of Economic Development: Emergency Shelter Grants Program 14.231 03-ES-004 $ 90,545 Department of Interior: State Historical Society of Iowa: Historic Preservation Fund Grants-in-Aid 15.904 20-03.007 $ 6,987 Department of Justice: Governor's Office of Drug Control Policy: Byrne Formula Grant Program 16.579 03A-0232 51,281 Violence Against Women Formula Grants 16.588 VW-04-4359 27,538 Department of Transportation: Iowa Department of Transportation: Highway Planning and Construction 20.205 STP-1-5(69)- -2C-52 108,294 Highway Planning and Construction 20.205 STP-U-3715(620)- -70-52 1,222,698 1,330,992 Federal Transit-Capital Investment Grants 20.500 IA-03-0092-375-01 16,456 Federal Transit-Capital Investment Grants 20.500 IA-03-0098-371-03 90,712 107,168 Iowa Depmhnent of Transportation and Johnson County Council of Governments: State Planning and Research 20.515 04MPO-JCCOG 120,104 State Planning and Research 20.515 04SPR-JCCOG 5,000 125,104 Department of Health and Human Services: University of Illinois at Chicago: HIV Care Fomiala Grant 93.917 N01-LM-1-3513 3,898 Total indirect 1,743,513 Total $13.560.628 See notes to the Schedule of Expenditures of Federal Awards. 120 CITY OF IOWA CITY, IOWA NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 2004 NOTE 1. BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the City . . of Iowa City, Iowa, and is presented in conformity with the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. NOTE 2. SUBRECIPIENTS Of the federal expenditures presented in the schedule, the City of Iowa City, Iowa, provided federal awards to subrecipients as follows: Federal Amount Provided Program Title CFDA Number to Subrecipients Community Development Block Grants/ Entitlement Grants 14.218 $ 373,323 Emergency Shelter Grants Program 14.231 84,495 HOME Investment Partnerships Program 14.239 593,936 121 CITY OF IOWA CITY, IOWA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2004 Part I: Summary of the Independent Auditor's Results: (a) Unqualified opinions were issued on the financial statements. (b) No reportable conditions in internal control over financial reporting were identified. (c) The audit did not disclose any non-compliance which is material to the financial statements. (d) No reportable conditions in internal control over the major programs were identified. (e) An unqualified opinion was issued on compliance with requirements applicable to each major program. (f) The audit did not disclose any audit findings which is required to be reported in accordance with Office of Management and Budget Circular A-133, Section .510(a). (g) The major programs were as follows: · CFDA 14.218 - Community Development Block Grants/Entitlement Grants · CFDA 20.205 - Highway Planning and Construction Cluster of Programs: · CFDA 20.500 - Federal Transit - Capital Investment Grants · CFDA 20.507 - Federal Transit - Formula Grants (la) The dollar threshold used to distinguish between Type A and Type B programs was $406,819. (i) The City of Iowa City, Iowa, qualified as a low-risk auditee. Part II: Other Findings Related to Statutory Reporting: II-A-04 Official Depositories - A resolution naming official depositories has been approved by the City. The maximum deposit amounts stated in the resolution were not exceeded during the year ended June 30, 2004. II-B-04 Certified Budget- Disbursements during the year ended June 30, 2004, did not exceed the amounts budgeted. 122 CITY OF IOWA CITY, IOWA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2004 Part II: Other Findings Related to Statutory Renorting: (continued) II-C-04 Questionable Expenditures- Certain disbursements were noted that may not meet thc requirements of public purpose as defined in an Attorney General's opinion dated April 25, 1979 since the public · . benefits to be derived have not been clearly documented. These disbursements are detailed as follows: Purpose Amount Cookies for mayor while in the hospital $ 20 Gifts for departing council members 340 Flowers for former council member's funeral 35 According to the opinion, it is possible for such disbursements to meet the test of ser~ing a public purpose under certain circumstances, although such items will certainly be subject to a deserved close scrutiny. The line to be drawn between a proper and an improper purpose is very thin. Recommendation - The Council should determine and document the public purpose served by these disbursements before authorizing any further payments. If this practice is continued, the City should establish written policies and procedures, including the requirement for proper documentation. Response - Staff is developing a policy which establishes procedures for these types of expenditures, including a requirement for written documentation. Conclusion - Response accepted. II-D-04 Travel Expense- No expenditures of City money for travel expenses of spouses of City officials or employees were noted. II-E-04 Business Transactions - Business transactions between the City and City officials or employees are detailed as follows: Name, Title, and Transaction Business Connection Description Amount Matthew Hayek, Housing and Legal services $ 378 Community Development Commission, member of Hayek, Hayek, Brown, Moreland & Hayek LLP Gary Haman, Board of Appeals, owner of Iowa City Plumbing Supplies $ 89 123 CITY OF IOWA CITY, IOWA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2004 Part II: Other Findings Related to Statutory, Reoorting: (continued) Name, Title, and Transaction Business Connection Description Amount Randy Hartwig, Airport Commission, City vehicles $ 67,815 Owner of Hartwig Motors Dee Vanderhoef, City Council Member, Supplies $ 6,286 owner of Iowa Book and Supply In accordance with Chapter 362.5(10) of the Code of Iowa, the above transactions do not appear to represent conflicts of interest since they were either less than $1,500 or entered into through competitive bidding. II-F-04 Bond Coverage - Surety bond coverage of City officials and employees is in accordance with statutory provisions. The amount of coverage should be reviewed annually to insure that the coverage is adequate for current operations. II-G-04 Council Minutes - No transactions were found that we believe should have been approved in the Council minutes but were not. II-H-04 Deposits and Investments - No instances of non-compliance with the deposit and investment provisions of Chapter 12B and Chapter 12C of the Code of Iowa and the City's investment policy were noted. II-I-04 Revenue Bonds - We noted no instances of non-compliance with the provisions of the City's revenue bond resolutions. 124