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HomeMy WebLinkAbout2022-04-19 ResolutionItem Number: 6.b. 4CITY OF IOWA CITY !kr4gi,'��� COUNCIL ACTION REPORT April 19, 2022 Resolution accepting the work for the 2021 Summer Sidewalk Repair Project. Prepared By: Kim Sandberg, Program Assistant Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: None Recommendations: Staff: Approval Commission: N/A Attachments: Engineer's Report Resolution Executive Summary: The project has been completed by Feldman Concrete of Dyersville, Iowa, in substantial accordance with the plans and specifications. The Engineer's Report and Performance and Payment bonds are on file with the City Clerk. • Project Estimated Cost: • Project Bid Received: • Project Actual Cost: $100,000.00 $88,965.00 $77,926.15 There were two (2) change orders on the project, including additional grading work and the assessment of liquidated damages. Background /Analysis: This annual project included the removal and replacement of deficient sidewalk squares as part of the City's Sidewalk Inspection Program. ATTACHMENTS: Description Engineer's Report Resolution ENGINEER'S REPORT April 5, 2022 City Council Iowa City, Iowa Re: 2021 Summer Sidewalk Repair Project e r ® 7 .1 .0194.141 P CITY OF IOWA CITY 410 East Washington Street Iowa City, Iowa 52240 - 1826 (319) 356 - 5000 (319) 356 - 5009 FAX www.icgov.org Dear City Council: I hereby certify that the 2021 Summer Sidewalk Repair Project has been completed by Feldman Concrete of Dyersville, Iowa in substantial accordance with the plans and specifications completed by the City of Iowa City. The project was bid as a unit price contract and the final contract price is $77,926.15. There was a total of two (2) change or extra work orders for the project: 1. Liquidated Damages 2. Regrade Parkway ($ 1,100.00) $ 250.00 Total ($850.00) I recommend that the above -referenced improvements be accepted by the City of Iowa City. Sincerely, Jason Havel, PE City Engineer Prepared by: Kim Sandberg, Public Works, 410 E. Washington 51, Iowa City, IA 52240 (319) 356-5139 Resolution No. 22-95 Resolution accepting the work for the 2021 Summer Sidewalk Repair Project Whereas, the Engineering Division has recommended that the work for construction of the 2021 Summer Sidewalk Repair Project, as included in a contract between the City of Iowa City and Feldman Concrete of Dyersville, Iowa, dated August 13, 2021, be accepted; and Whereas, the Engineer's Report and the performance and payment bond have been filed in the City Clerk's office; and Whereas, funds for this project are available in account # 22710220; and Whereas, the final contract price is $78,776.15. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that said improvements are hereby accepted by the City of Iowa City, Iowa. Passed and approved this 19th Attest: IV City Jerk day of April ,2022 It was moved by Weiner Approved by J City Attomels Office (Liz Craig — 04/12/2022) and seconded by Taylor the Resolution be adopted, and upon roll call there were: Ayes: Nays: Absent: x Alter Bergus Harmsen X Taylor X Teague X Thomas x Weiner X x (Q.o Item Number: 6.c. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution accepting the work for the City Park Ball Field Improvements Project. Prepared By: Ethan Yoder, Civil Engineer Reviewed By: Juli Seydell-Johnson, Parks and Recreation Director Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: None Recommendations: Staff: Approval Commission: N/A Attachments: Engineer's Report Resolution Executive Summary: The project has been completed by Century Fence Co. of Pewaukee, W I , in substantial accordance with the plans and specifications. The Engineer's Report and Performance and Payment bonds are on file with the City Clerk. • Project Estimated Cost: $ 147,000.00 • Project Bid Received: $ 164,082.67 • Project Actual Cost: $ 173,994.66 Background /Analysis: This project added and replaced fencing at the City Park Ball Fields. Fields 1-7 were enclosed by fence, providing a better player experience. Additionally, the batting cage and foul poles were updated, and Field 8 was reoriented for more playability. ATTACHMENTS: Description Engineer's Report resolution CITY OF IOWA CITY 410 East Washington Street Iowa City, Iowa 52240 - 1826 (319) 356 - 5000 (319) 356 - 5009 FAX www.icgov.org ENGINEER'S REPORT April 12, 2022 Re: City Park Ball Field Improvements Project Dear City Clerk: I hereby certify that the City Park Ball Field Improvements Project has been completed by Century Fence Co. of Pewaukee, Wisconsin, in substantial accordance with the plans and specifications prepared by the City of Iowa City. The project was bid as a unit price contract and the final contract price is $173,994.66. There was a total of one (1) change or extra work order for the project as described below: 1) Design Change for Fields 1, 2, 4, and 5 $9,911.99 I recommend that the above -referenced improvements be accepted by the City of Iowa City. Sincerely, Jason Havel, PE City Engineer Prepared by: Ethan Yoder, Engineering Division, Public Works, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5145 Resolution No. 22-96 Resolution accepting the work for the City Park Ball Field Improvements Project Whereas, the Engineering Division has recommended that the work for construction of the City Park Ball Field Improvements Project, as included in a contract between the City of Iowa City and Century Fence Co. of Pewaukee, WI, dated May 25, 2021, be accepted; and Whereas, the Engineer's Report and the performance, payment and maintenance bond have been filed in the City Clerk's office; and Whereas, funds for this project are available in the City Park Ball Field Improvements account # R4373; and Whereas, the final contract price is $173,994.66. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that said improvements are hereby accepted by the City of Iowa City, Iowa. Passed and approved this 19th Attest: day of April , 2022. It was moved by Weiner Approved by l City Attorney i Office (Sue Dulek — 04/12/2022) and seconded by Taylor adopted, and upon roll call there were: Ayes: Nays: Absent: x x x x x Alter Bergus Harmsen Taylor Teague Thomas Weiner the Resolution be Item Number: 6.d. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution approving revised Letter of Agreement with Johnson County for the combining of selected Iowa City precincts with selected Township Precincts. Prepared By: Eric R. Goers, City Attorney Reviewed By: Geoff Fruin, City Manager Kellie Fruehling, City Clerk Fiscal Impact: No impact. Recommendations: Staff: Approval Commission: N/A Attachments: Resolution Revised Letter of Agreement Executive Summary: This Revised Letter of Agreement will modify the original Agreement, approved by Council on December 17, 2021 via Resolution number 21-316. The Iowa Secretary of State's Office has directed this change, so as to ensure that no precincts straddle state legislative district boundaries. Following a meeting between Secretary of State staff, Johnson County Auditor staff, the Johnson County Attorney, the City Attorney, and representatives of other Johnson County municipalities, all parties are in agreement to move forward with the change. Background /Analysis: This will affect one household on Owl Song Lane, and the developing Community View subdivision. The Owl Song Lane household will vote in Iowa City Precinct 16, while Community View, which is in a different state legislative district, will vote with the Scott Township precinct, the polling place for which is at a church immediately across American Legion Road to the south. The Auditor's Office has long provided different ballots to different voters, depending on their place of residence, at the same polling place. ATTACHMENTS: Description Resolution Revised Letter of Agreement Prepared by: Eric R. Goers, City Attorney, 410 E. Washington St., Iowa City, IA 52244, 31 9- 6-5030 Resolution number: 22-97 Resolution approving revised Letter of Agreement with Johnson County for the combining of selected Iowa City precincts with selected Township Precincts Whereas, on December 17, 2021, the City approved a Letter of Agreement with Johnson County to combine select Iowa City precincts with select Johnson County Township precincts, in order to improve voting efficiency; and Whereas, following Johnson County's approval of said Letter of Agreement, the Letter, and other related reprecincting materials, were sent to the Iowa Secretary of State per the requirements of State law; and Whereas, the Secretary of State's Office communicated their approval of the City's reprecincting plan materials via a letter dated January 12, 2022; and Whereas, in an email dated April 7, 2022, the Secretary of State's Office alerted the Johnson County Auditor's Office that revisions were necessary to the Letter of Agreement between the County and the cities of Iowa City, Coralville, North Liberty, and Solon, respectively; and Whereas, the Secretary of State's Office provided requested language for a revised Letter of Agreement, which has been reviewed and approved by both the Johnson County Auditor and City staff; and Whereas, it is in the best interests of the City to approve the revised Letter of Agreement. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that the attached revised Letter of Agreement is hereby approved, and that the Mayor is authorized to sign, and the City Clerk to Attest, said Agreement. Passed and approved this JAL -0y of Apri 1 2022. Attest: M o Approved by City Attorney's ffice —0411412022 Res&oiution 22-97 Page 2 It was moved by Weiner and seconded by Tayl or Resolution be adopted, and upon roll call there were: Ayes: Nays: Absent: the x Alter x Bergus Harmsen Taylor _JL__ Teague Thomas x Weiner Revised Letter of Agreement City af Iowa City and the Jchnson County Board of Supervisors Combining Selected Iowa City Precincts with Selected Johnson County Township Precincts Section 49.6 of the Iowa Code grants cities and counties the power to combine township and city precincts as long as the combined precinct does not have a population in excess of three thousand five hundred (3,500), as shown by the most recent federal decennial census, and the combined precinct is wholly within a legislative district (except when this would force the creation of a precinct with fewer than fifty (50) registered voters). Precincts are required to follow census block boundaries and must be composed of contiguous territory. Combining township precincts with the contiguous Iowa City precincts allows township voters to vote at a nearby location. Township voters will vote separate township ballots and are not eligible to vote in City of lowa City municipal elections. Therefore it is agreed that the southeast portion of East Lucas Township contiguous to the Iowa City corporate limits and lying east of the east right-of-way line of Soccer Park Road in the southeast quarter of Section 35, Township 79 N, Range 6 W shall be combined with Iowa City Precinct 15. Therefore it is further agreed that the southwest portion of East Lucas Township contiguous to the Iowa City corporate limits and lying west of the west right-of-way line of Soccer Park Road in the southeast quarter of Section 35, Township 79 N, Range 6 W shall be combined with Iowa City Precinct 10. Therefore it is agreed that the north portion of East Lucas North Township lying north of the Iowa City corporate boundary shall be combined with Iowa City Precinct 22. Therefore it is agreed that the portions of Scott Township completely surrounded by the City of Iowa City, area known aoCensus Block 181830lO5O12O46and Census Blocks 19103O105D12O35and 191030105012039 shall be combined with !owa City Precinct 16. Therefore it is agreed that the area south of Scott Park and north of American Legion Road SE, also known as the Community View Subdivision, also known as Census Block 191030105012044 that was annexed after January 1, 2020 and is within a different legislative district than the remainder of the City shall be combined with the Scott Township Precinct. The City Council of Iowa City and the Johnson County Board of Supervisors agree to create the combined township and city precincts as described above. t t Teague, Mayo ity of Iowa City 04/19/22 Date Attest: Kellie Fruehling, Cit C erk Roycea n Porter, Chair, Board of Supervisors Date Item Number: 6.e. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution authorizing the Mayor to sign a State and Local Fiscal Recovery Fund (SLFRF) grant agreement with Johnson County to administer a Direct Assistance program targeting Iowa City residents who experienced a negative economic impact caused by the COVID-19 pandemic. Prepared By: Rachel Kilburg, Assistant City Manager Reviewed By: Eric Goers, City Attorney Fiscal Impact: The City has $17,386,108 in ARPA-SLFRF funds unencumbered and available. This agenda item would authorize expenditure of $1,500,000 of those funds. Recommendations: Staff: Approval Commission: N/A Attachments: Resolution Agreement Exhibit A Exhibit B Executive Summary: As part of the American Rescue Plan Act (ARPA), the City was awarded State and Local Fiscal Recovery Fund (SLFRF) dollars to respond to impacts of the COVI D-19 pandemic. This resolution authorizes a subrecipient grant agreement with Johnson County for $1,500,000 to administer a Direct Assistance program targeting Iowa City residents who experienced a negative economic impact caused by the COVI D-19 pandemic. Background /Analysis: Following extensive public input, at the September 7, 2021 City Council Work Session, staff presented initial expenditure recommendations and the City Council signaled their support for several initiatives, including a direct assistance program to eligible adults. Subsequently, the Johnson County Board of Supervisors also approved funding for a direct assistance program. The City Council and Board of Supervisors held a joint work session to discuss a direct payment program on November 16, 2021 and determined Johnson County would take the lead on development and administration of the program. Iowa City staff coordinated with County staff throughout this process. The U.S. Treasury permits the City to make subawards with SLFRF funds for the purpose of carrying out an eligible use under the SLFRF program. Per 31 CFR 35.6(b)(8), assistance to households, specifically "Assistance programs, including cash assistance programs, that respond to the COVID-19 public health emergency." is an enumerated eligible use of SLFRF funds. The U.S. Treasury's Final Rule defines households that are presumed eligible and provides guidance on proportional payment amounts. The framework developed by Johnson County aligns with the U.S. Treasury guidance and constitutes an eligible use of SLFRF funds. The U.S. Treasury has allocated $18.3 million to the City of Iowa City in SLFRF. The City has received its first tranche of entitled funds (approximately $9 million). The City previously authorized and obligated just under $1 million in SLFRF funds. Approval of this resolution would authorize the obligation and expenditure of $1.5 million of the City's remaining approximately $17.3 million SLFRF funds. ATTACHMENTS: Description Resolution Agreement Attachment A Attachment B Prepared by: Eric R. Goers, City Attorney, 410 E. Washington St, Iowa City, IA 52240 (319) 356-5030 Resolution Number 22-98 Resolution authorizing the Mayor to sign a State and Local Fiscal Recovery Fund (SLFRF) grant agreement with Johnson County to administer a Direct Assistance program targeting Iowa City residents who experienced a negative economic impact caused by the COVID-19 pandemic. Whereas, the U.S. Department of the Treasury (U.S. Treasury) allocated the City of Iowa City $18,325,190 through the State and Local Fiscal Recovery Fund (SLFRF) as part of the American Rescue Plan Act (aka, ARPA); and Whereas, the SLFRF program provides substantial flexibility to each jurisdiction to meet local needs within the four separate eligible use categories outlined in the Final Rule published by the U.S. Treasury on January 6, 2022 and other guidance released by the U.S. Treasury; and Whereas, providing direct assistance to Iowa City residents who have experienced a negative economic impact is an eligible use category under the Final Rule; and Whereas, the U.S. Treasury permits the City to make subawards with SLFRF funds for the purpose of carrying out an eligible use under the SLFRF program; and Whereas, Johnson County (the County) has developed a Direct Assistance Program (Program) targeting County residents who have experienced a negative economic impact as a result of COVID-19; and Whereas, under the County's Program, randomly selected applicants will receive a one-time, $1,400 check; and Whereas, the City wishes to allocate $1,500,000 in City SLFRF funds toward the County's program for the benefit of qualifying City residents under the same terms as the County program; and Whereas, the County is willing to administer the Program for City residents as well under the terms of the attached Subrecipient Agreement for Direct Cash Assistance Program (Agreement); and Whereas, under the terms of the Agreement, at least $1,350,000 of the $1,500,000 is reserved for distribution to City residents, with no more than $150,000 being retained by the County to defray the administrative costs of operating the program; and Whereas, residents of Iowa City would benefit from approval of this Agreement, and distribution of said funds. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that: 1. The Mayor is authorized to execute the attached Subrecipient Agreement for Direct Cash Assistance. Resolution No. 77_gR Page 2 Passed and approved this 19th day of April, 2022. It was moved by Weiner or h�or Approved by City Attorney' ffice — 04/14/2022 and seconded by Taylor adopted, and upon roll call there were: Ayes: Nays: Absent: _Y.— Alter Bergus x Harmsen Taylor x Teague Thomas Weiner x the Resolution be SUBRECIPIENT AGREEMENT FOR DIRECT CASH ASSISTANCE PROGRAM BETWEEN THE CITY OF IOWA CITY AND JOHNSON COUNTY, IOWA This Subrecipient Agreement ("Agreement") is dated as of the 4 / 19 / 22 day of April, 2022, by and between the City of Iowa City, Iowa, a municipal corporation (herein, the "City") and Johnson County, an Iowapolitical subdivision (the "County" or "Subrecipient"). WHEREAS, the U.S. Department of the Treasury ("Treasury") has allocated to the City $18,325,190 of federal funding from the Coronavirus State and Local Fiscal Recovery Fund under CFDA No. 21.027 ("ARPA Funds") and Section 603(b) of the Social Security Act, as amended by Section 9901 of the American Rescue PIan Act ("ARPA"), of which $9,162,595 was transferred to the City on May 14, 2021, for the limited purposes identified in the Coronavirus State Fiscal Recovery Fund Award Terms and Conditions between the Treasury and the City ("Interagency Agreement"), attached hereto as Attachment A, and the Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule' and Final Rule2 (altogether, the "Final Rule"); and WHEREAS, the ARPA authorizes expenditure of ARPA Funds awarded to local governments like the City and County for eligible purposes identified in the Final Rule, such as responding to the COVID-19 public health emergency or its negative economic impacts by providing assistance to households; and WHEREAS, the economic crisis caused by the pandemic worsened economic outcomes for many low- and moderate -income households; and WHEREAS, households presumed to be impacted by the COVED -19 public health emergency are defined by the Final Rule as follows: • Low- to moderate -income; • Those who experienced unemployment; • Those who experienced increased food or housing insecurity; • Those who qualified for specific federal programs; and/or • Those who reside in Qualified Census Tracts; and WHEREAS, cash transfers are an enumerated eligible use under the Final Rule; and - WHEREAS, the County is establishing a Direct Assistance Program (the "DA Program"3) that will provide one-time $1,400 payments to Johnson County residents who experienced a negative economic impact as a result of the COVID-19 pandemic, such as unemployment, housing insecurity, food insecurity, or exclusion from previous federal stimulus payments; are low- to moderate -income; and have Lived in Johnson County since March 1, 2020; and WHEREAS, the City desires to allocate and transfer a portion of the City's ARPA Funds to the County as Subrecipient, to supplement the appropriation approved by the County for the DA Program, for the specific purpose of expanding the emergency economic relief able to be delivered to residents of the City through the DA Program; and WHEREAS, the County is willing to receive the transfer of City ARPA Funds for distribution as part of the County's DA Program under the terms and conditions set forth in this Subrecipient Agreement; and WHEREAS, the U.S. Treasury permits the City to make subawards with SLFRF funds for the purpose of carrying out an eligible use under the SLFRF program. 1 Coronavirus State and Local Fiscal Recovery Funds (Interim Final Rule), 86 Fed. Reg. 26,786 (May 17, 2021). 2 Coronavirus State and Local Fiscal Recovery Funds (Final Rule), 87 Fed. Reg. 4,338 (Jan. 27, 2022). 3 The DA Program was approved by the Johnson County Supervisors on February 24, 2022 by Resolution No. 02- 24-22-03. 1 NOW, 'HEREFORE, in consideration of the foregoing recitals which are incorporated herein by reference, and the terms and conditions set forth below, the parties agree as follows: 1. Effective Date and Term. This Agreement shall commence when last executed by all parties and remain in effect until December 31, 2026, unless earlier terminated as provided in Paragraph 6, below. 2. ARPA Funds. The City agrees to provide the Subrecipient a total sum not to exceed $1,500,000.00 (the "City's Funds") to be used for the provision of emergency economic relief through the Subrecipient's DA Program to residents of the City of Iowa City, and associated ARPA-eligible administrative costs. Pursuant to the ARPA, Eligible Uses under this non-R&D federal program must be obligated no earlier than March 3, 2021 and no later than December 31, 2024, with final disbursement of all funds no later than December 31, 2026. 3. Subrecipient's Use of ARPA Funds. The Subrecipient shall ensure that the City's Funds are only used to (i) respond to the negative economic impacts of the COVID-19 public health emergency by providing emergency economic relief payments to residents of the City of Iowa City through the Subrecipient's DA Program, and (ii) defray administrative costs associated with the DA Program. More specifically: a. The DA Program will be managed by the County consistent with the program guidelines established in Board of Supervisors' Resolution No. 02-24-22-03 adopted February 24, 2022, which is incorporated herein by this reference; b. Using the available amount of funds appropriated for the DA Program by the County, and the City's Funds (Less the Subrecipient's applicable administration costs as described in Paragraph 4 below), the Subrecipient will make one-time payments via County check in the amount of $1,400.00 per beneficiary (each a "DA Relief Payment"). In the event there are more applicants following the close of the application period than relief payments available under the DA Program, applicants' eligibility will be confirmed and, if eligible, will have a random number assigned to their application, which will then be sorted sequentially from lowest to highest for selection and distribution of the applicable DA Relief Payment, until the County's funds and the City's Funds are exhausted as described below. i. An eligible applicant is a person that has submitted a complete application signed (electronically) and attested by the applicant and timely submitted via the Subrecipient's online DA Program application portal, establishing the applicant's identity, requisite residency in Johnson County (i.e_ lived in Johnson County on March 1, 2020, and continue to live in Johnson County), annual income below the program ceiling, and any other requirements, all pursuant to the guidelines of the DA Program. Incomplete and/or inaccurate applications may be rejected in the Subrecipient's sole discretion. Untimely applications will not be accepted. ii. With respect to the City's Funds, the Subrecipient will endeavor to disburse City's Funds only to eligible applicants that are City residents as of the time of their application to the DA Program, as represented to the Subrecipient by applicants when submitting their applications. iii. The Subrecipient will review applications for completeness and eligibility. Applicants determined ineligible will have an opportunity to appeal to Subrecipient staff within seven (7) days of notice of initial determination of ineligibility. lf, upon appeal, Subrecipient determines an applicant is indeed eligible for the DA Program, said applicant(s) will be included with the set of applications eligible for selection. Subrecipient's decision upon such an appeal is final. Eligible applicants will then be selected in the order from lowest to highest according to the random number assigned to each application. 2 1. If an application contains information sufficient to establish that a person is an eligible applicant, the first 1,428 applications selected as described above will be approved for the DA Program benefit using County's Funds. 2. The next 964 applications from persons whose applications contain information sufficient to establish that a person is an eligible applicant and that they are a resident of the City as of the date their application was submitted, will be approved for the DA Program benefit and the Subrecipient shall use City's Funds for disbursement of their DA Relief Payment. 3. In the event there is a remaining balance of City's Funds after all eligible applicants that are City residents have received a DA Relief Payment, the Subrecipient and City shall coordinate the return of any remaining City's Funds to the City, less the Subrecipient's applicable administration costs, or may otherwise direct the disposition of such remaining City's Funds as the City and Subrecipient may mutually agree. c. In the event the County check for a DA Relief Payment remains undeposited or uncashed after March 31, 2023, the County will void al] such checks and the unclaimed funds will revert to the County's general ARPA account, to be utilized for other ARPA-authorized uses. Should there be ten (10) or more such voided checks for disbursements made to City residents using City's Funds, as described in Para. 3(b)(iii)(2) above, the Subrecipient shall undertake to remit the unclaimed funds to the City following cancellation of such checks. Any other unclaimed funds may be retained by the Subrecipient. 4. Ineligible Uses; Subrecipient's Administration Costs. Non -allowable uses of ARPA Funds include, without limitation, the following: a) damages covered by insurance; b) usage of funds as a deposit into any pension fund; c) expense that have been or will be reimbursed under any federal program; d) debt service costs; e) contributions to "rainy day" fund; and f) legal settlements. In consideration of the Subrecipient's investment in establishing the DA Program, acquiring and devoting staff and materials to develop and implement such a program, and use of the DA Program and Subrecipient resources as a mechanism for distribution of the City's Funds for the benefit of City residents, the City shall reimburse the Subrecipient from the City's Funds for the expenses and staff time spent establishing the DA Program, accommodating the inclusion and distribution of the City's Funds as part of the DA Program, and/or administering the City's Funds (the "Administration Costs"), not to exceed $150,000. Staff time shall be reimbursed based on the employees' gross wages plus benefits. The Subrecipient shall provide monthly invoices reasonably sufficient to document the nature and extent of such costs and that such costs are eligible expenses under ARPA and reasonable and allocable costs in accordance with 2 CFR 200.404 and 2 CFR 200.405. To the extent, if any, interest is earned on City's Funds while in the custody or control of the Subrecipient, the Subrecipient may retain such interest earned as additional compensation for Administration Costs. The Subrecipient will invoice the City for the Programmatic Funds (defined below) so as to reasonably minimize the time during which interest may be earned on City's Funds before disbursement as DA Relief Payments, i.e. not immediately upon the effective date of this Agreement but sufficiently prior to the close of the DA Program application period to allow for completion of the City's claim approval and payment process and receipt of the City's Funds by the Subrecipient on or before the Subrecipient begins sorting applications and making DA Relief Payments. 5. Transfer of the Ci 's Funds to Subreci ient and Re ' ortin Reuirements. To facilitate the release of ARPA Funds by the City to the County and the City's compliance with reporting requirements for usage of ARPA funding under the Federal Award Terms and Conditions, the Subrecipient will submit invoices to the City, Attn: Accounting, with separate invoices used for no less than $1,350,000.00 in City's Funds to be applied to DA Relief Payments ("Programmatic Funds") and no more than $150,000.00 to be paid to the 3 Subrecipient for the Administration Costs, as described above. The City shall then disburse ARPA Funds, as requested by the Subrecipient, to the Subrecipient to support the DA Program as set forth in this Agreement. Monthly Reporting Requirements. The Subrecipient will provide monthly reports to the City detailing the activities supported by these ARPA Funds, sufficient to enable the City to meet its reporting requirements to Treasury under ARPA. The Subrecipient shall also provide information, as reasonably requested by the City, indicating the disbursements of City's Funds were made to City residents as reflected on the applications submitted by such recipients, provided that the City shall safeguard the confidentiality of the contents of applications and other information provided by the Subrecipient upon the City's request. The Subrecipient shall provide said reports as of the end of each month on a form provided by the City, which will be substantially similar to the draft form, which is attached, marked Exhibit B, and incorporated herein. Such reports shall be delivered to the City not later than the tenth (10th) day of each month, and shall contain the following: a. The cumulative amount spent on programmatic and administrative costs of the Program; b. The cumulative number of households served; c. A certification that, as of such reporting date and at all times since the previous reporting date (or if none, since the date of the Agreement), the Subrecipient is and has been in full compliance with all terms of the Agreement; and d. Such other items as the City shall reasonably request related to the Agreement. Close flat ReportingReuirements. The close out of this Agreement k governed by 2 CFR 200.343-.344. Subrecipient's obligation to the City shall not end until all close-out requirements are completed, and the compliance period is over. Notwithstanding the foreeoing, satisfaction of the City's reporting requirements to Treasury are and remain the ultimate sole responsibility of the City. 6. Termination. a. Until the Subrecipient has issued and the City received the Subrecipient's invoice for the Programmatic Funds, either the Subrecipient or the City may terminate this Agreement for convenience, upon prior notice to the other party. Thereafter, this Agreement shall expire on December 31, 2026, unless earlier terminated by mutual agreement of the parties or subparagraph b. in this Paragraph 6. b. Notwithstanding anything in this Agreement to the contrary, and subject to the limitations set forth below, either the Subrecipient or the City shall have the right to terminate this Agreement upon five (5) days' advance written notice, in each case without penalty, as a result of any of the following: i. The Board of Supervisors and/or the City Council fail to appropriate funds sufficient to allow the County and/or the City to either meet its obligations under this Agreement or to operate as required and to fulfill its obligations under this Agreement; or ii. If funds are de -appropriated, reduced, not allocated, or receipt of funds is delayed, or if any funds or revenues needed by the County to make any payment hereunder are insufficient or unavailable for any other reason as determined by the County in its sole discretion; or iii. If the County's authorization to conduct its business or engage in activities or operations related to the subject matter of this Agreement is withdrawn or materially altered or modified; or iv. lithe County's duties, programs or responsibilities are modified or materially altered; or v. If there is a decision of any court, administrative law judge or an arbitration panel or any lav, rule, regulation or order is enacted, promulgated or issued that materially or 4 adversely affects the County's and/or the City's ability to fulfill any of its obligations under this Agreement or disadvantages the County or the City as a consequence of either party's performance hereunder. In the event this Agreement is terminated, the Subrecipient will not incur new DA Program obligations for the terminated portion of this Agreement after it has given or received, as applicable, the notification of termination and will take reasonable steps to cancel as many outstanding obligations as possible that are the subject of this Agreement. In the event of termination, any unspent Programmatic Funds and Administrative Costs shall be returned to the City. In no event will the Subrecipient be reimbursed Administrative Costs exceeding 10% of Programmatic Funds expended. 7. Independent Contractor. No separate legal or administrative entity is created by virtue of this Agreement. Each party under the Agreement shall be for all purposes an independent contractor. Neither the County nor any agent or employee of the County shall be considered an employee of the City or fiscal agent. The County agrees that it has, or will secure at its own expense, all personnel required to perform all its obligations required under this Agreement and will be responsible for all taxes, social security payments, unemployment compensation and all other obligations of an employer. 8. Indemnification. Each Party shall be liable for any and all claims for wrongful death, personal injury or property damage attributable to the negligent acts or omissions of that party and the officers, employees and agents thereof. This section shall survive the expiration or termination of this Agreement. Nothing herein is intended to serve as a waiver of sovereign immunity by any party to which sovereign immunity (e.g. the immunities of Iowa Code Chapter 670) applies. Nothing herein will be construed as consent by the City or the County to be sued by third parties in any matter arising out of this Agreement. Notwithstanding anything else in this Agreement, City acknowledges that self -attestation and/or applicant - supplied documentation will be allowed as sufficient evidence establishing one or more bases of eligibility for the DA Program and disbursement using the City's Funds (e.g. residency in Johnson County and Iowa City, annual income below established maximums, non -receipt of Federal C©VID-19 stimulus payment(s), etc.), and that the Subrecipient has limited resources and means of independently verifying applicants' eligibility for the DA Program. Accordingly, the City does hereby waive and holds the Subrecipient harmless from any and all claims, known or unknown, arising from disbursement by the Subrecipient of City's Funds to applicants who do not otherwise meet the eligibility criteria for the DA Program and/or are not residents of the City of Iowa City but have so indicated in their applications. Should the Treasury seek recoupment of ARPA Funds from either the City or County based upon the disbursement of City Funds through the DA Program as a result of a program structure the Treasury believes is unlawful, the City shall be solely responsible to the Treasury for satisfying such recoupment demands of the City's $1,500,000 fund contribution and shall indemnify and hold the County fully and completely harmless from all obligations, costs, damages and other expenses the County may incur as a consequence of such recoupment action by Treasury. Should the Treasury seek recoupment of ARPA Funds from either the City or County based upon the disbursement of City Funds through the DA Program to specific individuals who, based on the application materials they provide to the County, are not eligible to receive the funds under the agreed-upon structure of the DA Program, the County shall be solely responsible to the Treasury for satisfying such recoupment demands and shall indemnify and hold the City fully and completely harmless from all obligations, costs, damages and other expenses the City may incur as a consequence of such recoupment action by Treasury. 9. Compliance with Laws, Guidelines. The Subrecipient shall use reasonable efforts to comply with all federal, state, and Local laws and all requirements (including debarment and other required certifications and audits) of the Interagency Agreement, Final Rule, and Compliance and Reporting Guidelines to the extent applicable when disbursing DA Relief Payments. 5 10. MaintenanceandAudit of Records. The Subrecipient shall maintain records, books, documents, and other materials relevant to its performance under this Agreement. These records shall be subject to inspection, review, and audit by the City or its designee, the Iowa State Auditor's Office and as required by the Interagency Agreement, Final. Rule, and Compliance and Reporting Guidelines for five (5) years following the termination of this Agreement. If it is determined during the course of the audit that the Subrecipient was funded for unallowable costs under this Agreement, the Subrecipient agrees to promptly reimburse the City for suchfunds upon request, subject to the City's indemnification and hold harmless obligations provided in Paragraph 8, above. In all other respects, each party is individually responsible for any record keeping, financial reporting, and maintaining an appropriate accounting of its expenditure of funds as required by ARPA and any other applicable federal or state laws. 11. Notices. Any notice desired or required to be given hereunder shall be in writing, and shall be deemed received three (3) days after deposit with the U.S. Postal Service, postage fully prepaid, certified mail, return receipt requested, and addressed to the party to which it is intended at its last known address, or to such other person or address as either party shall designate to the other from time to time in writing forwarded in the Iike manner: Johnson County, Iowa Johnson County Board of Supervisors Attn: Chairperson 913 S. Dubuque Street Iowa City, IA 52240 City of Iowa City City of Iowa City Attn: City Manager 410 E. Washington Street Iowa City, IA 52240 12. Improper Influence. Each party warrants that it did not and will not employ, retain, or contract with any person or entity on a contingent compensation basis for the purpose of seeking, obtaining, maintaining, or extending this Agreement. Each party agrees, warrants, and represents that no gratuity whatsoever has been or will be offered or conferred with a view towards obtaining, maintaining, or extending this Agreement. 13. Conflict of Interest. The elected and appointed officials and employees of the parties shall not have personal interest, direct or indirect, which gives rise to a conflict of interest. 14. Time. Time is of the essence in this Agreement. 15. Survival. The provisions of this Agreement that by their sense and purpose should survive expiration or termination of the Agreement shall so survive. Those provisions include without limitation Indemnification and Maintenance and Audit of Records. 16. Amendment. No amendment or modification to the Agreement will be effective without prior written consent of the authorized representatives of the parties. 17. Governing Law: Venue. The Agreement will be governed in all respects by the laws of the State of Iowa, both as to interpretation and performance, without regard to conflicts of law or choice of law previsions. Any action arising out of or in connection with the Agreement may be instituted and maintained only in a court of competent jurisdiction in Johnson County, Iowa. 18. Non -Waiver. No failure on the part of the City or the County to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the City or County of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein are cumulative and not exclusive of any remedy available to the parties at taw or in equity. 19. Bindinn Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors. 20. Assignment. The County shall not assign or transfer any of its interest in or obligations 21. Entire Agreement. This Agreement constitutes the entire agreement between the City and the County for the use of funds received under this Agreement and it supersedes all prior or contemporaneous communications and proposals, whether electronic, oral, or written between the parties with respect to this Agreement. 22. No Third -Party Beneficiaries. Nothing herein shall or be deemed to create or confer any right, action, or benefit in, to, or on the part of any person or entity that is not a party to this Agreement. This provision shall not limit any obligation which either Party has to Treasury in connection with the use of ARPA Funds, including the obligations to provide access to records and cooperate with audits as provided in this Agreement. 23. Severability. In the event that one or more provisions of this Agreement shall be determined invalid by any court of competent jurisdiction or agency having jurisdiction thereof, the remainder of the Agreement shalt remain in full force and effect and the invalid provisions shall be deemed deleted. 24. Counterparts. This Agreement may be executed in one or more counterparts, any of which shall be deemed an original but all of which together shall constitute one and the same instrument. 25. Authorization. Each party signing below warrants to the other party, that they have full power and authority to execute this Agreement on behalf of the party for whom they sign, IN WITNESS WHEREOF, this Agreement is executed and shall become effective as of the last date signed below, For City of Iowa City: For Jon County, Ioy ia: %.0" 1j By: Bru due Mayor of Iowa City Date 7 By: Royceann 'orter, Chai erson Johnson County Board of Supervisors ATTEST: Date ATTACHMENT A INTERAGENCY AGREEMENT BETWEEN THE U.S. DEPARTMENT OF TREASURY AND CITY OF IOWA CITY ATTACHMENT B Monthly Reporting Fonn 9 U.S. DEPARTMENT OF THE TREASURY CORONAVIRUS STATE FISCAL RECOVERY FUND AWARD TERMS AND CONDITIONS 1. Use of Funds. a. Recipient understands and agrees that the funds disbursed under this award may only be used in compliance with sections 602(c) and 603(c) of the Social Security Act (the Act) and Treasury's regulations implementing that section and guidance. b. Recipient will determine prior to engaging in any project using this assistance that it has the institutional, managerial, and financial capability to ensure proper planning, management, and completion of such project. 2 Period of_Prformance. The period of performance for this award begins on the date hereof and ends on December 31, 2026. As set forth in Treasury's implementing regulations, Recipient may use award funds to cover eligible costs incurred during the period that begins on March 3, 2021 and ends on December 31, 2024. 3. Reporting. Recipient agrees to comply with any reporting obligations established by Treasury, as it relates to this award. Maintenance of and Access to Records a. Recipient shall maintain records and financial documents sufficient to evidence compliance with sections 602(c) and 603(c), Treasury's regulations implementing those sections, and guidance regarding the eligible uses of funds. b. The Treasury Office of Inspector General and the Government Accountability Office, or their authorized representatives, shall have the right of access to records (electronic and otherwise) of Recipient in order to conduct audits or other investigations. c. Records shall be maintained by Recipient for a period of five (5) years after all funds have been expended or returned to Treasury, whichever is later. 5_ Pre award Costs. Pre -award costs, as defined in 2 C.F.R. § 200.458, may not be paid with funding from this award. 6. Administrative Costs, Recipient may use funds provided under this award to cover both direct and indirect costs. 7. Cost Sharing. Cost sharing or matching funds are not required to be provided. by Recipient. 8. Conflicts ofrl�terest. Recipient understands and agrees it must maintain a conflict of interest policy consistent with 2 C.F.R. § 200.318(c) and that such conflict of interest policy is applicable to each activity funded under this award. Recipient and subrecipients must disclose in writing to Treasury or the pass-through entity, as appropriate, any potential conflict of interest affecting the awarded funds in accordance with 2 C.F.R. § 200.112. 9. Compliance with Applicable Law and Regulations. a. Recipient agrees to comply with the requirements of sections 602 and 603 of the Act, regulations adopted by Treasury pursuant to sections 602(0 and 603(f) of the Act, and guidance issued by Treasury regarding the foregoing. Recipient also agrees to comply with all other applicable federal statutes, regulations, and executive orders, and Recipient shall provide for such compliance by other parties in any agreements it enters into with other parties relating to this award. b. Federal regulations applicable to this award include, without limitation, the following: i. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 2 C.F.R. Part 200, other than such provisions as Treasury may determine are inapplicable to this Award and subject to such exceptions as may be otherwise provided by Treasury. Subpart F — Audit Requirements of the Uniform Guidance, implementing the Single Audit Act, shall apply to this award. ii. Universal Identifier and System for Award Management (SAM), 2 C.F.R. Part 25, pursuant to which the award term set forth in Appendix A to 2 C.F.R. Part 25 is hereby incorporated by reference. iii. Reporting Subaward and Executive Compensation Information, 2 C.F.R. Part 170, pursuant to which the award term set forth in Appendix A to 2 C.F.R. Part 170 is hereby incorporated by reference. iv. OMB Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement), 2 C.F.R. Part 180, including the requirement to include a term or condition in all lower tier covered transactions (contracts and subcontracts described in 2 C.F.R. Part 180, subpart B) that the award is subject to 2 C.F.R. Part 180 and Treasury's implementing regulation at 31 C.F.R. Part 19. v. Recipient Integrity and Performance Matters, pursuant to which the award term set forth in 2 C.F.R. Part 200, Appendix XII to Part 200 is hereby incorporated by reference. vi. Governmentwide Requirements for Drug-Free Workplace, 31 C.F.R. Part 20. vii. New Restrictions on Lobbying, 31 C.F.R. Part 21. viii. Uniform Relocation Assistance and Real Property Acquisitions Act of 1970 (42 U.S.C. §§ 4601-4655) and implementing regulations. ix. Generally applicable federal environmental laws and regulations. c. Statutes and regulations prohibiting discrimination applicable to this award, include, without limitation, the following: i. Title VI of the Civil Rights Act of 1964 (42 U.S.C. §§ 2000d et seq.) and Treasury's implementing regulations at 31 C.F.R. Part 22, which prohibit discrimination on the basis of race, color, or national origin under programs or activities receiving federal financial assistance; ii. The Fair Housing Act, Title VIII of the Civil Rights Act of 1968 (42 U.S.C. §§ 3601 et seq.), which prohibits discrimination in housing on the basis of race, color, religion, national origin, sex, familial status, or disability; iii. Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. § 794), which prohibits discrimination on the basis of disability under any program or activity receiving federal financial assistance; iv. The Age Discrimination Act of 1975, as amended (42 U.S.C. §§ 6101 et seq.), and Treasury's implementing regulations at 31 C.F.R. Part 23, which prohibit discrimination on the basis of age in programs or activities receiving federal financial assistance; and v. Title II of the Americans with Disabilities Act of 1990, as amended (42 U.S.C. §§ 12101 et seq.), which prohibits discrimination on the basis of disability under programs, activities, and services provided or made available by state and local governments or instrumentalities or agencies thereto. 10. Remedial Actions. In the event of Recipient's noncompliance with sections 602 and 603 of the Act, other applicable laws, Treasury's implementing regulations, guidance, or any reporting or other program requirements, Treasury may impose additional conditions on the receipt of a subsequent tranche of future award funds, if any, or take other available remedies as set forth in 2 C.F.R. § 200.339. In the case of a violation of sections 602(c) or 603(c) of the Act regarding the use of funds, previous payments shall be subject to recoupment as provided in sections 602(e) and 603(e) of the Act. 1. Hatch Act Recipient agrees to comply, as applicable, with requirements of the Hatch Act (5 U.S.C. §§ 1501-1508 and 7324-7328), which limit certain political activities of State or local government employees whose principal employment is in connection with an activity financed in whole or in part by this federal assistance. 12. False Statements. Recipient understands that making false statements or claims in connection with this award is a violation of federal law and may result in criminal, civil, or administrative sanctions, including fines, imprisonment, civil damages and penalties, debarment from participating in federal awards or contracts, and/or any other remedy available by law. 13 Publications. Any publications produced with funds from this award must display the following language: "This project [is being] [was] supported, in whole or in part, by federal award number [enter project FAIN] awarded to City of lowa City by the U.S. Department of the Treasuty." 14 Debts Owed the Federal Government, a. Any funds paid to Recipient (1) in excess of the amount to which Recipient is finally determined to be authorized to retain under the terms of this award; (2) that are determined by the Treasury Office of Inspector General to have been misused; or (3) that are determined by Treasury to be subject to a repayment obligation pursuant to sections 602(e) and 603(e) of the Act and have not been repaid by Recipient shall constitute a debt to the federal government. b. Any debts determined to be owed the federal government must be paid promptly by Recipient. A debt is delinquent if it has not been paid by the date specified in Treasury's initial written demand for payment, unless other satisfactory arrangements have been made or if the Recipient knowingly or improperly retains funds that are a debt as defined in paragraph 14(a). Treasury will take any actions available to it to collect such a debt. 15. Disclaimer, a. The United States expressly disclaims any and all responsibility or liability to Recipient or third persons for the actions of Recipient or third persons resulting in death, bodily injury, property damages, or any other losses resulting in any way from the performance of this award or any other losses resulting in any way from the performance of this award or any contract, or subcontract under this award. b. The acceptance of this award by Recipient does riot in any way establish an agency relationship between the United States and Recipient. 16. Protections for Whistleblowers. a. In accordance with 41 U.S.C. § 4712, Recipient may not discharge, demote, or otherwise discriminate against an employee in reprisal for disclosing to any of the list of persons or entities provided below, information that the employee reasonably believes is evidence of gross mismanagement of a federal contract or grant, a gross waste of federal funds, an abuse of authority relating to a federal contract or grant, a substantial and specific danger to public health or safety, or a violation of law, rule, or regulation related to a federal contract (including the competition for or negotiation of a contract) or grant_ b. The list of persons and entities referenced in the paragraph above includes the following: i. A member of Congress or a representative of a committee of Congress; ii. An Inspector General; iii. The Government Accountability Office; iv. A Treasury employee responsible for contract or grant oversight or management; v. An authorized official of the Department of Justice or other law enforcement agency; vi. A court or grand jury; or vii. A management official or other employee of Recipient, contractor, or subcontractor who h investigate, discover, or address misconduct. Recipient shall inform its employees in writing of the rights and remedies provided under this sectio native language of the workforce. 17. In si = Pursuant to Executive Order 13043; 62 FR 19217 (Apr. 18, 1997), Recipient should encourage its contractors to adopt and enforce on-the-job seat belt policies and programs for their employees when operating company-owned, rented or personally owned vehicles. l R. Reducing Text Messaging While Driving. Pursuant to Executive Order 13513, 74 FR 51225 (Oct. 6, 2009), Recipient should encourage its employees, subrecipients, and contractors to adopt and enforce policies that ban text messaging while driving, and Recipient should establish workplace safety policies to decrease accidents caused by distracted drivers. c. the responsibility to in the predominant 1' e s�. DocuSign Envelope ID:17FDB2EA-6FF6-4OF9-SA03-1BFDBFOA93CC OMB Approved No. 1505-0271 Expiration Date: November 30, 2021 U.S. DEPARTMENT OF THE TREASURY CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS Recipient name and address: City of Iowa City 410 E. Washington Street Iowa City, Iowa, 52240 DUNS Number: 782621940 Taxpayer Identification Number: 426004805 Assistance Listing Number: 21.019 Sections 602(b) and 603(b) of the Social Security Act (the Act) as added by section 9901 of the American Rescue Plan Act, Pub. L. No. 117-2 (March 11, 2021) authorize the Department of the Treasury (Treasury) to make payments to certain recipients from the Coronavirus State Fiscal Recovery Fund and the Coronavirus Local Fiscal Recovery Fund. Recipient hereby agrees, as a condition to receiving such payment from Treasury, to the terms attached hereto. Recipien —DocuSigned by: r Vtis f k v�skjt 4549-1-66F2465. Authorized Representative: Dennis Bockenstedt Title: Finance Director Date signed: 5/1112021 U.S. Department of the Treasury: Authorized Representative: Title: Date: PAPERWORK REDUCTION ACT NOTICE The information collected will be used for the U.S. Government to process requests for support. The estimated burden associated with this collection of information is 15 minutes per response_ Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the Office of Privacy, Transparency and Records, Department of the Treasury, 1500 Pennsylvania Ave., N.W., Washington, D.C. 20220. DO NOT send the form to this address. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by OMB. OMB Approved No. 1505-0271 Expiration Date: 11/30/2021 U.S. DEPARTMENT OF THE TREASURY CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS Recipient name and address: City of Iowa City 410 E Washington Street Iowa City, Iowa 52240 DUNS Number: 782621940 Taxpayer Identification Number: 426004805 Assistance Listing Number and Title- 21.027 Sections 602(b) and 603(b) of the Social Security Act (the Act) as added by section 9901 of the American Rescue Plan Act, Pub. L. No. 117-2 (March 11, 2021) authorizes the Department of the Treasury (Treasury) to make payments to certain recipients from the Coronavirus State Fiscal Recovery Fund and the Coronavirus Local Fiscal Recovery Fund. Recipients hereby agrees, as a condition to receiving such payment from Treasury, agrees to the terms attached hereto. Recipient: Authorized Representative Signature (above) Authorized Representative Name: Authorized Representative Title: Date Signed: U.S. Department of the Treasury: Dennis Bockenstedt Finance Director frJ� - fY'� Authorized Representative Signature (above) Authorized Representative Name: Authorized Representative Title: Jacob Leibenluft Chief Recovery Officer, Office of Recovery Programs Date Signed: May 13, 2021 PAPERWORK REDUCTION ACT NOTICE The information collected will be used for the U.S. Government to process requests for support. The estimated burden associated with this collection of information is 15 minute per response. Comments concerning the accuracy of this burden estimate and suggestions far reducing this burden should be directed to the Oflicc of Privacy. Transparency and Records, Department of the Treasury, 1 Sob Pennsylvania Ave., N.W., Washington, D.C. 20220.1)0 NOT send the form to this address. M agency may not conduct or sponsor, and a person is riot required to respond to, a collection of information unless itdisplays a valid control number assigned by OMB. DocuSign Envelope ID: 17FDB2EA-6FF6-4OF9-8AO3-1BFDBFOAs3CC OMB Approved No. 1505-0271 Expiration Date: November 30, 2021 ASSURANCES OF COMPLIANCE WITH CIVIL RIGHTS REQUIREMENTS ASSURANCES OF COMPLIANCE WITH TITLE VI OF THE CIVIL RIGHTS ACT OF 1964 As a condition of receipt of federal financial assistance from the Department of the Treasury, the recipient named below (hereinafter referred to as the "Recipient") provides the assurances stated herein. The federal financial assistance may include federal grants, loans and contracts to provide assistance to the Recipient's beneficiaries, the use or rent of Federal land or property at below market value, Federal training, a loan of Federal personnel, subsidies, and other arrangements with the intention of providing assistance. Federal financial assistance does not encompass contracts of guarantee or insurance, regulated programs, licenses, procurement contracts by the Federal government at market value, or programs that provide direct benefits. The assurances apply to all federal financial assistance from or funds made available through the Department of the Treasury, including any assistance that the Recipient may request in the future. The Civil Rights Restoration Act of 1987 provides that the provisions of the assurances apply to all of the operations of the Recipient's program(s) and activity(ies), so long as any portion of the Recipient's program(s) or activity(ies) is federally assisted in the manner prescribed above. 1. Recipient ensures its current and future compliance with Title VI of the Civil Rights Act of 1964, as amended, which prohibits exclusion from participation, denial of the benefits of, or subjection to discrimination under programs and activities receiving federal financial assistance, of any person in the United States on the ground of race, color, or national origin (42 U.S.C. § 2000d et seq.), as implemented by the Department of the Treasury Title VI regulations at 31 CFR Part 22 and other pertinent executive orders such as Executive Order 13166, directives, circulars, policies, memoranda, and/or guidance documents. 2. Recipient acknowledges that Executive Order 13166, "Improving Access to Services for Persons with Limited English Proficiency," seeks to improve access to federally assisted programs and activities for individuals who, because of national origin, have Limited English proficiency (LEP). Recipient understands that denying a person access to its programs, services, and activities because of LEP is a form of national origin discrimination prohibited under Title VI of the Civil Rights Act of 1964 and the Department of the Treasury's implementing regulations. Accordingly, Recipient shall initiate reasonable steps, or comply with the Department of the Treasury's directives, to ensure that LEP persons have meaningful access to its programs, services, and activities. Recipient understands and agrees that meaningful access may entail providing language assistance services, including oral interpretation and written translation where necessary, to ensure effective communication in the Recipient's programs, services, and activities. 3. Recipient agrees to consider the need for language services for LEP persons when Recipient develops applicable budgets and conducts programs, services, and activities. As a resource, the Department of the Treasury has published its LEP guidance at 70 FR 6067. For more information on taking reasonable steps to provide meaningful access for LEP persons, please visit hun://www.lep.aay. 1 DocuSign Envelope ID: 17FDB2EA-6FF6-40F9-8A03-1 BFDBFOA93CC OMB Approved No. 1505-0271 Expiration Date: November 30, 2021 4. Recipient acknowledges and agrees that compliance with the assurances constitutes a condition of continued receipt of federal financial assistance and is binding upon Recipient and Recipient's successors, transferees, and assignees for the period in which such assistance is provided. 5. Recipient acknowledges and agrees that it must require any sub -grantees, contractors, subcontractors, successors, transferees, and assignees to comply with assurances 1-4 above, and agrees to incorporate the following language in every contract or agreement subject to Title VI and its regulations between the Recipient and the Recipient's sub -grantees, contractors, subcontractors, successors, transferees, and assignees: The sub -grantee, contractor, subcontractor, successor, transferee, and assignee shall comply with Title VI of the Civil Rights .pct of 1964, which prohibits recipients offederal financial assistance from excluding from a program or activity, denying benefits of or otherwise discriminating against a person on the basis of race, color, or national origin (42 U.S.C. ,¢ 2000d et seq), as implemented by the Department of the Treasury's Title VI regulations, 31 CFR Part 22, which are herein incorporated by reference and made a part of this contract (or agreement). Tide VI also includes protection to persons with "Limited English Proficiency" in any program or activity receiving federal financial assistance, 42 L'S.C § 2000d et seq., as implemented by the Department of the Treasury's Title VI regulations, 31 CFR Part 22, and herein incorporated by reference and made a part of this contract or agreement. 6. Recipient understands and agrees that if any real property or structure is provided or improved with the aid of federal financial assistance by the Department of the Treasury, this assurance obligates the Recipient, or in the case of a subsequent transfer, the transferee, for the period during which the real property or structure is used for a purpose for which the federal financial assistance is extended or for another purpose involving the provision of similar services or benefits. If any personal property is provided, this assurance obligates the Recipient for the period during which it retains ownership or possession of the property. 7. Recipient shall cooperate in any enforcement or cornpliance review activities by the Department of the Treasury of the aforementioned obligations. Enforcement may include investigation, arbitration, mediation., litigation, and monitoring of any settlement agreements that may result from these actions. The Recipient shall comply with information requests, on-site compliance reviews and reporting requirements. 8. Recipient shall maintain a complaint log and inform the Department of the Treasury of any complaints of discrimination on the grounds of race, color, or national origin, and limited English proficiency covered by Title VI of the Civil Rights Act of 1964 and implementing regulations and provide, upon request, a list of all such reviews or proceedings based on the complaint, pending or completed, including outcome. Recipient also must inform the Department of the Treasury if Recipient has received no complaints under Title VI. 9. Recipient must provide documentation of an administrative agency's or court's findings of non-compliance of Title VI and efforts to address the non-compliance, including any voluntary compliance or other 2 aocuSign Envelope ID: 17FDB2EA-6FF6-4OF9-8A03-1 BFDBFOA93GC OMB Approved No. 1505-0271 Expiration Date: November 30, 2021 agreements between the Recipient and the administrative agency that made the finding. If the Recipient settles a case or matter alleging such discrimination, the Recipient must provide documentation of the settlement. If Recipient has not been the subject of any court or administrative agency finding of discrimination, please so state. 10. If the Recipient makes sub -awards to other agencies or other entities, the Recipient is responsible for ensuring that sub -recipients also comply with Title VI and other applicable authorities covered in this document State agencies that make sub -awards must have in place standard grant assurances and review procedures to demonstrate that that they are effectively monitoring the civil rights compliance of sub - recipients. The United States of America has the right to seek judicial enforcement of the terms of this assurances document and nothing in this document alters or limits the federal enforcement measures that the United States may take in order to address violations of this document or applicable federal law. Under penalty of perjury, the undersigned official(s) certifies that official(s) has read and understood the Recipient's obligations as herein described, that any information submitted in conjunction with this assurances document is accurate and complete, and that the Recipient is in compliance with the aforementioned nondiscrimination requirements. City of Iowa City 5/11/2021 Recipient Caocu5lgned by; t,In In.iS 156(ktet&Stat 455053g1sePa4us Signature of Authorized Official Date PAPERWORK REDUCTION ACT NOTICE The information collected will be used for the U.S. Government to process requests for support. The estimated burden associated with this collection of information is 30 minutes per response. Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the Office of Privacy, Transparency and Records, Department of the Treasury, 1500 Pennsylvania Ave., N.W., Washington, D.C. 20220. DO NOT send the form to this address. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by OMB. 3 To be completed by City: Subrecipient Name: Project Name: Project ID Number: Subaward No.: Total Award: $ Attachment B CITY OF IOWA CITY ARPA-SLFRF Monthly Report Form Reporting Period (select one): ❑ Jan -Mar (Q1) ❑ Apr -June (Q2) ❑ July -Sept (Q3) ❑ Oct -Dec (Q4) Reporting Month (preceding month for which you are reporting upon): (. nc\ ^tt it. Amount of Programmatic (Direct Payments) Costs Incurred (cumulative, to -date): $ ;lid:k or tnp rtes. to ..enter ter,. Amount of Programmatic Costs Expended (cumulative, to -date): Amount of Administrative Costs Incurred (cumulative, to -date): Amount of Administrative Costs Expended (cumulative, to -date): Completion Status: Crtctose, an iter.! Brief Description of Project Accomplishments for the Month: C!ic..k ^r tEip her . ;enter-xt $ Click or r;;;; r, r, to enter tax: $ C li :I $ ..lick �r hf.,: e ^.t -o:.. Programmatic and Subaward-Specific Data: 1. Total number of households served by Program (cumulative, to -date): Cho c;r tit-.;, here tc; en; -r 2. Total number of Iowa City households served by Program (cumulative, to -date): C;li:;r: tap here tc ewer text 3. Please attach and upload to this form an invoice and itemized summary of uses for any administrative costs billed to the City for the preceding month. Administrative costs billed to the City must be eligible under ARPA and comply with reasonable and allocable cost principles contained in 2 CFR 200.404 and 2 CFR 200.405. Certification and Signature: By signing below, I attest all information contained herein is true and accurate and certify that as of the reporting date below and at all times since the date of the executed grant agreement, the County has been in full compliance with all terms of the agreement: Signature Date Item Number: 7.a. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the 2022 Water Pavement Patching Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Prepared By: Marri VanDyke, Civil Engineer Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: $175,000 available in the Water Division Operating Budget, account #73730130 Recommendations: Staff: Approval Commission: N/A Attachments: Resolution Executive Summary: This item begins the bidding process for the 2022 Water Pavement Patching Project, which includes pavement repairs associated with water main breaks on various streets throughout Iowa City. Types of pavement that need repaired include Portland Cement Concrete (PCC), PCC with Hot Mix Asphalt (HMA) overlay, and full depth HMA. Some locations will also require the removal and replacement of driveway, sidewalk, and/or curb and gutter. Background /Analysis: Each year there are, on average, approximately 60 water main breaks within the City, and street and or sidewalk pavement typically needs to be removed and replaced in order to repair the water main. With limited resources and the emergency nature of the pavement repairs, the City is combining the pavement repairs at multiple main break sites into a single project to more efficiently address pavement damage resulting from water main breaks. As additional main breaks occur later this year, those sites will also be added to this project for repair. Project Timeline: Set Public Hearing — April 19, 2022 Hold Public Hearing — May 3, 2022 Bid Letting — May 25, 2022 Award Date — June 6, 2022 Construction — June 2022 to November 2022 ATTACHMENTS: Description Resolution Prepared by: Mani VanDyke, Engineering Division, 410 E. Washington SL, Iowa City, IA 52240, (319)356-5044 Resolution No. 99-99 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the 2022 Water Pavement Patching Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Whereas, funds for this project are available in the Water Divisions Operating Budget account #73730130. Now, therefore, be it resolved by the Council of the City of Iowa City, Iowa, that: 1. A public hearing on the project manual and estimate of cost for the construction of the above-mentioned project is to be held on the 3rd day of May, 2022, at 6:00 p.m. in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, or if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk. 2. The City Clerk is hereby authorized and directed to publish notice of the public hearing for the above-named project in a newspaper published at least once weekly and having a general circulation in the City, not less than four (4) nor more than twenty (20) days before said hearing. 3. A copy of the project manual and estimate of cost for the construction of the above-named project is hereby ordered placed on file by the City Engineer in the office of the City Clerk for public inspection. Passed and approved this 19th Attest: - City Jerk City Attorney'"Office — 04/14/2022 day of Approved by It was moved by Weiner adopted, and upon roll call there were: Ayes: x x X X x x and seconded by Nays: Tayl nr Absent: Alter Bergus Harmsen Taylor Teague Thomas Weiner the Resolution be Item Number: 7.b. 4CITY OF IOWA CITY !kr4gi,'��� COUNCIL ACTION REPORT April 19, 2022 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the 2022 Rochester Avenue Reconstruction from Ralston Creek to N First Avenue Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Prepared By: Justin Harland, Sr. Civil Engineer Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: $5,600,000 available in the Rochester Avenue Reconstruction account #S3950 Recommendations: Staff: Approval Commission: N/A Attachments: Location Map Resolution Executive Summary: This agenda item sets the date for the public hearing for the 2022 Rochester Avenue Reconstruction from Ralston Creek to N First Avenue Project. This project includes the full reconstruction of the roadway, as well as new storm sewer, sanitary sewer structures, water main, ADA sidewalk improvements, and on -street bike lanes. Background /Analysis: Rochester Avenue serves as an arterial within the City of Iowa City. The street pavement along Rochester Avenue from First Avenue to the bridge over Ralston Creek requires frequent maintenance and has reached the end of its useful life. The project will include complete reconstruction of Rochester Avenue between First Avenue to the bridge over Ralston Creek. Additionally, the project will include improvements to the sidewalk, ADA curb ramps, storm sewer, sanitary sewer, other utilities as needed, signage, landscaping, and other associated work. Project Timeline: Set Public Hearing —April 19, 2022 Hold Public Hearing / Approve Plans and Specifications — May 3, 2022 Bid Letting — May 24, 2022 Award Date — June 6, 2022 Construction Start — July 5, 2022 Final Completion — December 31, 2023 ATTACHMENTS: Description Location Map Resolution 2022 ROCHESTER AVENUE RECONSTRUCTION FROM RALSTON CREEK TO N FIRST AVENUE PROJECT MAP Prepared by: Justin Harland, Engineering Division, 410 E. Washington St., Iowa City, IA 52240, (319)356-5154 Resolution No. 22-100 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the 2022 Rochester Avenue Reconstruction from Ralston Creek to N First Avenue Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Whereas, funds for this project are available in the Rochester Avenue Reconstruction account #S3950. Now, therefore, be it resolved by the Council of the City of Iowa City, Iowa, that: 1. A public hearing on the project manual and estimate of cost for the construction of the above-mentioned project is to be held on the 3'd day of May, 2022, at 6:00 p.m. in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, or if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk. 2. The City Clerk is hereby authorized and directed to publish notice of the public hearing for the above-named project in a newspaper published at least once weekly and having a general circulation in the City, not less than four (4) nor more than twenty (20) days before said hearing. 3. A copy of the project manual and estimate of cost for the construction of the above-named project is hereby ordered placed on file by the City Engineer in the office of the City Clerk for public inspection. Passed and approved this 19th Attest: day of April ,2022 Approved by City It was moved by Weiner adopted, and upon roll call there were: City Attomey Office (Sara Green Wood Hektoen — 04/13/2022) and seconded by Taylor the Resolution be Ayes: Nays: Absent: X Alter x Bergus Harmsen Taylor x Teague x Thomas x Weiner X x Item Number: 7.c. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the Eastwood Drive and South Lawn Drive Intersection Improvement Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Prepared By: Alin Dumachi, Sr. Civil Engineer Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: $225,000 available in the Annual Storm Sewer Improvements account #M3631 Recommendations: Staff: Approval Commission: N/A Attachments: Location Map Resolution Executive Summary: This agenda item begins the bidding process for the Eastwood Drive and South Lawn Drive Intersection Improvements Project. The project generally includes the replacement of existing storm sewer with new storm sewer pipes and intakes, upgrading of existing 6" ductile iron water main to 8" PVC, new 8" PCC pavement with integral 6" curb, and new ADA compliant curb ramps. Background /Analysis: Due to severe deterioration of the storm sewer intakes and pavement at the intersection of Eastwood Drive and South Lawn Drive, full reconstruction of the intersection is included along with utility improvements. The project includes the following design elements: • Replacement of existing storm sewer system, with new storm sewer pipes and intakes • 8" PCC pavement with integral 6" curb • 6" subdrains under Eastwood Drive • Upgrade existing 6" ductile iron water main to 8" PVC pipe. • Relocate and replace existing fire hydrant • New curb ramps to meet ADA compliance The project manual and estimate of cost for the Eastwood Drive and South Lawn Drive Intersection Improvements Project have been filed in the Office of the City Clerk for public examination. ATTACHMENTS: Description Location Map Resolution john oai Johnson County GIS (.: t,ty Web Printing Project Location Printed: 3/24/2022 0 0.00375 0.0075 I 1 0.015 1 inch = 37 feet 1 mi The information presented herein is intended to be an accurate representation of existing records. Johnson County assumes no liabiity for errors or omissions. Users relying on this nformation do so at their own risk. Prepared by: Alin Dumachi, Engineering Division, 410 E. Washington St., Iowa City, IA 52240, (319)356-5143 Resolution No. J2—LO1 Resolution setting a public hearing on May 3, 2022 on project manual and estimate of cost for the construction of the Eastwood Drive and South Lawn Drive Intersection Improvement Project, directing City Clerk to publish notice of said hearing, and directing the City Engineer to place said project manual on file for public inspection. Whereas, funds for this project are available in the Annual Storm Water Improvements account #M3631. Now, therefore, be it resolved by the Council of the City of Iowa City, Iowa, that: 1. A public hearing on the project manual and estimate of cost for the construction of the above-mentioned project is to be held on the 3rd day of May, 2022, at 6:00 p.m. in the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, or if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk. 2. The City Clerk is hereby authorized and directed to publish notice of the public hearing for the above-named project in a newspaper published at least once weekly and having a general circulation in the City, not less than four (4) nor more than twenty (20) days before said hearing. 3. A copy of the project manual and estimate of cost for the construction of the above-named project is hereby ordered placed on file by the City Engineer in the office of the City Clerk for public inspection. Passed and approved this 19th day of April It was moved by tip;npr adopted, and upon roll call there were: Ayes: x x x x X x X Approved by , 2022 City Attorneyffice (Sara Greenwood Hektoen — 04/12/2022) and seconded by Taylor Nays: Absent: Alter Bergus Harmsen Taylor Teague Thomas Weiner the Resolution be Item Number: 11. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution approving project manual and estimate of cost for the construction of the Benton Street Rehabilitation Project [STP -U-3715(669)-- 70-52], establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Prepared By: Melissa Clow, Special Projects Administrator Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: $4,200,000 available in the Benton Street Rehabilitation Project account #S3947 Recommendations: Staff: Approval Commission: N/A Attachments: Location Map Resolution Executive Summary: The Benton Street Rehabilitation Project includes a crack -and -seat of the existing pavement with a Hot Mix Asphalt (HMA) overlay, painting of on -street bike lanes, ADA sidewalk improvements, and traffic and pedestrian signal improvements at the Benton and Sunset intersection. Background /Analysis: The project corridor extends approximately 6,550 feet along Benton Street, from Mormon Trek Boulevard to 150 feet east of Benton Drive. The existing pavement is a 33 -foot wide Portland Cement Concrete (PCC) roadway with approximately two 13 -foot wide travel lanes (one in each direction) and 3 -foot painted shoulders. With the crack -and -seat and overlay project, the existing curb lines will remain and the overall width of the street will stay the same. However, the roadway will be restriped to include two 11 -foot travel lanes (one in each direction) and 5 -foot on -street bike lanes. The City has completed a diamond grinding project within this section of Benton Street to try and address rideability issues. However, the existing pavement is in poor condition, with joint deterioration becoming an increasing issue for much of the corridor. Sidewalk facilities exist along both sides of Benton Street, including curb ramps at most intersections. However, many of the curb ramps do not meet current ADA requirements. The MPOJC programmed $1,316,000.00 in STBG funding for the Benton Street Rehabilitation Project in the FY2021-2024 Transportation Improvement Program (TIP). Council accepted this funding in February 2021. One bid was received in January 2022 that exceeded the Engineer's Estimate by more than 40%. Subsequently, the City rejected the bid and the DOT concurred. The Engineer's Estimate has been updated to reflect current material pricing and milestone dates have been revised to provide additional flexibility to contractors to either split work into two construction seasons (Fall 2022 — Fall 2023) or complete all work in one season (Spring — Fall 2023). Project Timeline: Hold Public Hearing / Approve Plans and Specifications — April 19, 2022 Iowa DOT Bid Letting — June 21, 2022 Award Date — July 5, 2022 Construction Start — Fall 2022 / Spring 2023 Final Completion — Fall 2023 ATTACHMENTS: Description Location Map Resolution Exhibit A IL Prepared by: Melissa Clow, Engineering Division, 410 E. Washington St., Iowa City, IA 52240, (319) 356-5413 Resolution No. 22-102 Resolution approving project manual and estimate of cost for the construction of the Benton Street Rehabilitation Project [STP -U- 3715(669)--70-52], establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Whereas, notice of public hearing on the project manual and estimate of cost for the above- named project was published as required by law, and the hearing thereon held; and Whereas, this project will be bid by the Iowa Department of Transportation (DOT); and Whereas, bids will be accepted on June 21, 2022 at 10:00 a.m. by the DOT, Office of Contracts in Ames, Iowa; and Whereas, the City Engineer or designee intends to post notice of the project on the website owned and maintained by the City of Iowa City; and Whereas, funds for this project are available in the Benton Street Rehabilitation account # S3947. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa that: 1. The project manual and estimate of cost for the above-named project are hereby approved. 2. The amount of bid security to accompany each bid for the construction of the above- named project shall be in the form and amount prescribed in the bidding proposal. 3. The City Clerk is hereby authorized and directed to post notice as required in Section 26.3, not less than 13 days and not more than 45 days before the date of the bid letting, which may be satisfied by timely posting notice on the Construction Update Network, operated by the Master Builder of Iowa, and the Iowa League of Cities website. 4. Bids for the above-named project are to be received by the DOT, Office of Contracts, 800 Lincoln Way, Ames, Iowa, before 10:00 a.m. on the 21st day of June, 2022. Thereafter, the bids will be opened and announced by the DOT, and thereupon referred to the City Council of the City of Iowa City, Iowa for action upon said bids at its next regular meeting, to be held at the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at 6:00 p.m. on the 5th day of July, 2022, or at a special meeting called for that purpose. Resolution No. 22-102 Page 2 Passed and approved this 19th day of April , 2022. May It was moved by Thomas (-P_o- Approveedd G4 City Attorney'. Office (Sara Greenwood Hektoen — 04/11/2022) and seconded by Alter adopted, and upon roll call there were: Ayes: Nays: Absent: X Alter X Bergus X Harmsen X Taylor X X X Teague Thomas Weiner the Resolution be Item Number: 12. 1 4CITY OF IOWA CITY !kr4gi,'��� COUNCIL ACTION REPORT April 19, 2022 Resolution approving project manual and estimate of cost for the construction of the North Westminster Storm Sewer Improvements Project, establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Prepared By: Ben Clark, Sr. Civil Engineer Reviewed By: Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: $1,350,000 available in the North Westminster Storm Sewer Upgrades account #M3633 Recommendations: Staff: Approval Commission: N/A Attachments: Location Map Resolution Executive Summary: This project involves improving the storm sewer system along North Westminster Street and Washington Street and also includes street reconstruction and sidewalk accessibility. Background /Analysis: The North Westminster drainage area was studied in response to reported flash flooding near the intersection of North Westminster Street and Washington Street. The study confirmed that sections of the storm sewer system are inadequate to convey runoff for the City's current 5 -year design storm criteria. Surface flooding at these two locations can be deep enough to cover the width of the roadway, overtop the curb and flow onto adjacent properties, creating a potential for property damage and a public safety concern for vehicles. The Project involves the following: 1. Replace the Westminster Street existing 36" storm sewer with new 48" storm sewer from Washington Street to north of Bowling Green Place. 2. Replace the Washington Street existing storm sewer system with new larger pipe and add new storm intakes, west of Westminster. 3. Add new storm curb intakes along Westminster between Bowling Green Place and Hastings Avenue. 4. Replacement of Westminster pavement graded such to provide an appropriate overflow route during large storm events. 5. Replace street, sidewalk and driveway pavement associated with new storm sewer and Westminster overflow route. 6. Provide American with Disabilities Act (ADA) compliant sidewalks and curb ramps within the project limits. 7. Improvements to the water system at the intersection of Westminster/Washington and Westminster/Bowling Green by providing hydrant assemblies within 25 -feet of the intersections per standards with appropriate valving to allow for the hydrants to be used in multiple directions as a flush point. 8. Relocate and/or adjust sanitary sewer system components and other utilities within the project limits as needed to accommodate the new storm sewer system improvements. Project Timeline: Hold Public Hearing —April 19, 2022 Bid Letting — May 10, 2022 Award Contract — May 17, 2022 Construction — June 2022 to May 2023 ATTACHMENTS: Description Location Map Resolution •• R ARBOR HILL CIRCLE W ID SHRACER RD 1- w H z 5 f HASTINGS AVE • PROJECT LOCATION LEMME ELEMENTARY WASHINGTON ST DARTMOUTH ST -- Prepared by: Ben Clark, Engineering Division, 410 E. Washington St., Iowa City, IA 52240, (319) 356-5436 Resolution No. 22-103 Resolution approving project manual and estimate of cost for the construction of the North Westminster Storm Sewer Improvements Project, establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Whereas, notice of public hearing on the project manual and estimate of cost for the above- named project was published as required by law, and the hearing thereon held; and Whereas, the City Engineer or designee intends to post notice of the project on the website owned and maintained by the City of Iowa City; and Whereas, funds for this project are available in the North Westminster Storm Sewer Upgrades account #M3633. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa that: 1. The project manual and estimate of cost for the above-named project are hereby approved. 2. The amount of bid security to accompany each bid for the construction of the above- named project shall be in the amount of 10% (ten percent) of bid payable to Treasurer, City of Iowa City, Iowa. 3. The City Clerk is hereby authorized and directed to post notice as required in Section 26.3, not less than 13 days and not more than 45 days before the date of the bid letting, which may be satisfied by timely posting notice on the Construction Update Network, operated by the Master Builder of Iowa, and the lowa League of Cities website. 4. Sealed bids for the above-named project are to be received by the City of Iowa City, Iowa, at the Office of the City Clerk, at the City Hall, before 3:00 p.m. on the 10th day of May, 2022. At that time, the bids will be opened by the City Engineer or his designee, and thereupon referred to the City Council of the City of Iowa City, Iowa, for action upon said bids at its next regular meeting, to be held at the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at 6:00 p.m. on the 17th day of May, 2022, or at a special meeting called for that purpose. Passed and approved this 19th day of April Attest: City Clerk City Attomey's' Office (Sara Greenwood Hektoen - 04/11/2022) 1a- Resolution No. 22-103 Page 2 It was moved by Taylor and seconded by Bergus the Resolution be adopted, and upon roll call there were: Ayes: Nays: Absent: x Alter x Bergus X Harmsen x Taylor x Teague X Thomas x Weiner Item Number: 13. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution approving project manual and estimate of cost for the construction of the Wetherby Park Sidewalk and Driveway Project, establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Prepared By: Ethan Yoder, Civil Engineer Reviewed By: Juli Seydell Johnson, Parks and Recreation Director Jason Havel, City Engineer Ron Knoche, Public Works Director Geoff Fruin, City Manager Fiscal Impact: The estimated cost for this project is $93,000. Funds are available in the Account #R4393 — Wetherby Park Entrance & Parking Lot Recommendations: Staff: Approval Commission: N/A Attachments: Location Map Resolution Executive Summary: This project generally includes the removal and replacement of existing sidewalk, addition of new sidewalk, and reconstruction of the parking lot access from Taylor Drive. Background /Analysis: Wetherby Park is an existing park located in south Iowa City. The park's current amenities include a splash pad, playground equipment, a picnic shelter, cooking grills, sports courts, restrooms, a disc golf course, community garden plots, and a hiking path. The City is looking to improve the park through the removal and replacement of existing sidewalk, constructing new sidewalk to enter the park and access the community gardens, and reconstruction of the vehicle access drive from Taylor Drive. This project will be funded in part with CDBG funds. Project Timeline: Public Hearing and Approve Project Manual — April 19, 2022 Bid Letting — May 10, 2022 Award Date — May 17, 2022 Construction Start — June 2022 Final Completion — Fall 2022 ATTACHMENTS: Description Location Map Resolution Wetherby Dr Prepared by: Ethan Yoder, Engineering Division, 410 E. Washington St., Iowa City, IA 52240, (319) 356-5145 Resolution No. 22-104 Resolution approving project manual and estimate of cost for the construction of the Wetherby Park Sidewalk and Driveway Project, establishing amount of bid security to accompany each bid, directing City Clerk to post notice to bidders, and fixing time and place for receipt of bids. Whereas, notice of public hearing on the project manual and estimate of cost for the above- named project was published as required by law, and the hearing thereon held; and Whereas, the City Engineer or designee intends to post notice of the project on the website owned and maintained by the City of Iowa City; and Whereas, funds for this project are available in the Wetherby Park Entrance & Parking Lot account # R4393. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa that: 1. The project manual and estimate of cost for the above-named project are hereby approved. 2. The amount of bid security to accompany each bid for the construction of the above- named project shall be in the amount of 10% (ten percent) of bid payable to Treasurer, City of Iowa City, Iowa. 3. The City Clerk is hereby authorized and directed to post notice as required in Section 26.3, not less than 13 days and not more than 45 days before the date of the bid letting, which may be satisfied by timely posting notice on the Construction Update Network, operated by the Master Builder of Iowa, and the Iowa League of Cities website. 4. Sealed bids for the above-named project are to be received by the City of Iowa City, Iowa, at the Office of the City Clerk, at the City Hall, before 3:00 p.m. on the 10th day of May, 2022. At that time, the bids will be opened by the City Engineer or his designee, and thereupon referred to the City Council of the City of Iowa City, Iowa, for action upon said bids at its next regular meeting, to be held at the Emma J. Harvat Hall, City Hall, Iowa City, Iowa, at 6:00 p.m. on the 17th day of May, 2022, or at a special meeting called for that purpose. Passed and approved this 19th Attest: day of April May , 2022. Approved .y City Attorne s Office J (Sara Greenwood Hektoen — 04/12/2022) i 3 Resolution No.22-104 Page 2 It was moved by Weiner and seconded by Rer• ,G adopted, and upon roll call there were: Ayes: Nays: Absent: x Alter x Bergus X Harmsen x Taylor x Teague x Thomas x Weiner the Resolution be Item Number: 15. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution Directing the Advertisement For Sale Of $10,255,000* (Dollar amount Subject To Change) General Obligation Bonds, Series 2022, And Approving Electronic Bidding Procedures And Distribution Of Preliminary Official Statement Prepared By: Jacklyn Fleagle, Assistant Finance Director Reviewed By: Nicole Davies, Finance Director Fiscal Impact: Adopted as part of the FY2022 Revised Budget and 2022-2026 Capital Improvement Program Recommendations: Staff: Approval Commission: N/A Attachments: Preliminary Official Statement Resolution Executive Summary: This is a resolution to advertise for the sale, to approve the electronic bidding procedures, and to approve the distribution of the preliminary official statement for the 2022 General Obligation Bonds. This resolution establishes the sale time and date and bidding procedures for the 2022 General Obligation Bonds. It also accepts and approves the Preliminary Official Statement or sale document for the bonds. Background /Analysis: The City issues bonds every spring to fund the current year's capital improvement projects listed in the Five -Year Capital Improvement Program. The City intends to take bids for $10,255,000 in general obligation bonds on May 3 and then close on the bond sale on June 1. The FY2022 Revised Budget and FY2023 Adopted Budget have been approved with the necessary property tax levies needed for repayment of the 2022 General Obligation Bonds. The City's long-term planning has incorporated the 2022 proposed bond issue and repayment schedule. City Council approval of the resolution directing the advertisement for sale, approving electronic bidding procedures, and distribution of the preliminary official statement is the next required action to facilitate the sale and issuance of the 2022 General Obligation Bonds. ATTACHMENTS: Description Preliminary Official Statement Resolution New Issue Date of Sale: Tuesday, May 3, 2022 (Alternate Bid Methods) Between 10:30 and 11:00 A.M., C.D.T. (Closed SpeerAuction) Before 11:00 A.M., C.D.T. (Sealed Bids) Official Statement Investment Rating: Moody's Investors Service ... (Rating Requested) Assuming compliance with certain covenants, in the opinion ofAhlers & Cooney, P.C., Bond Counsel, under present law and assuming continued compliance with the requirements of the Internal Revenue Code of 1986, as amended (the "Code'), interest on the Bonds is excludable from gross income for federal income tax purposes. Interest on the Bonds is not an item of tax preference for federal alternative minimum tax purposes. Interest on the Bonds is not exempt from present Iowa income taxes. The Bonds will NOT be designated as "qualified tax-exempt obligations ". See "TAX MATTERS" herein for a more detailed discussion. Dated Date of Delivery $10,255,000* CITY OF IOWA CITY Johnson County, Iowa General Obligation Bonds, Series 2022 Book -Entry Due Serially June 1, 2023 - 2032 The $10,255,000* General Obligation Bonds, Series 2022 (the "Bonds") are being issued by the City of Iowa City, Johnson County, Iowa (the "City"). Interest is payable semiannually on June 1 and December 1 of each year, commencing December 1, 2022. Interest is calculated based on a 360 -day year of twelve 30 -day months. The Bonds will be issued using a book -entry system. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the Bonds. The ownership of one fully registered Bond for each maturity will be registered in the name of Cede & Co., a nominee for DTC and no physical delivery of Bonds will be made to purchasers. The Bonds will mature on June 1 in the following yfs and amounts. AMOUNTS*, MATURITIES, INTEREST RATES, PR ES OR YIELDS AND CUSIP NUMBERS Principal Due Interest Price or CUSIP Prin Due Interest Price or CUSIP Amount* June 1 Rate Yield Number(1) Amou June 1 Rate Yield Number(1) $1,315,000 2023 % % $995,000 2028 % % 995,000 2024 % % 995,000 2029 % % 995,000 2025 % % 995,000 2030 % % 995,000 2026 % % 995,000 2031 % 995,000 2027 % % 980,000 2032 % % Any consecutive maturities may be aggregated into term bonds a option of the bidder, in ich case the mandatory redemption provisions shall be on the same schedule as above. OPTIONAL RE EMPTION Bonds due June 1, 2023 - 2028, inclusive, are not subject to optional redemption. Bonds due June 1, 2029 - 2032, inclusive, are callable in whole or in part on any date on or after June 1, 2028, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. See "OPTIONAL REDEMPWN" herein. PURPOSE, LEGALITY AND SECURITY The proceeds of the Bonds are expected to be used to: (i) fmance the cost of various essential and general corporate purpose capital improvements, and (ii) pay the costs of issuing the Bonds. See "THE PROJECT" herein. In the opinion of Bond Counsel, Ahlers & Cooney, P.C., Des Moines, Iowa, the Bonds will constitute valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable, real property within the corporate limits of the City without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors' rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. This Official Statement is dated April , 2022, and has been prepared under the authority of the City. An electronic copy of this Official Statement is available from the www.speerfinancial.com web site under "Official Statement Sales Calendar". Additional copies may be obtained from Nicole Davies, Finance Director, City of Iowa City, 410 E. Washington Street, Iowa City, Iowa, 52240, or from the Registered Municipal Advisors to the City. Speer Financial, Inc. ►„�J INDEPENDENT MUNICIPAL ADVISORS • ESTABLISHED 1954 230 WEST MONROE STREET, SUITE 2630 • CHICAGO, ILLINOIS 60606 Telephone: (312) 346-3700 • Facsimile: (312) 346-8833 531 COMMERCIAL STREET, SUITE 608 • WATERLOO, IOWA 50701 Telephone: (319) 291-2077 • Facsimile: (319) 291-8628 *Subject to principal adjustment in accordance with the Official Terms of Offering. (1) CUSIP numbers appearing in this Official Statement have been provided by the CUSIP Service Bureau, which is managed on behalf of the American Bankers Association by S&P Capital IQ, a part of McGraw Hill Financial Inc. The City is not responsible for the selection of CUSIP numbers and makes no representation as to their correctness on the Bonds or as set forth on the cover of this Official Statement. For purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, this document, as the same may be supplemented or corrected by the City from time to time (collectively, the "Official Statement"), may be treated as an Official Statement with respect to the Bonds described herein that is deemed near final as of the date hereof (or the date of any such supplement or correction) by the City. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law or deemed appropriate by the City, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. Any such addendum or addenda shall, on and after the date thereof, be fully incorporated herein and made a part hereof by reference. Alternatively, such final terms of the Bonds and other information may be included in a separate document entitled "Final Official Statement" rather than through supplementing the Official Statement by an addendum or addenda. No dealer, broker, salesman or other person has been authorized by the City to give any information or to make any representations with respect to the Bonds other than as contained in the Official Statement or the Final Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the City. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the City and, while believed to be reliable, is not guaranteed as to completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CITY SINCE THE RESPECTIVE DATES THEREOF. References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents do not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by reference to the particular document, the full text of which may contain qualifications of and exceptions to statements made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official Statement, they will be furnished on request. This Official Statement does not constitute an offer to sell, or solicitation of an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would be unlawful. TABLE OF CONTENTS Page BOND ISSUE SUMMARY 1 SECURITY AND SOURCE OF PAYMENT 2 BONDHOLDERS' RISKS 3 Potential Impact of The Coronavirus 3 Secondary Market 4 Ratings Loss 4 Redemption Prior to Maturity 4 Forward -Looking Statements 4 Tax Matters, Bank Qualification and Loss of Tax Exemption 4 DTC -Beneficial Owners 5 Pension and OPEB Benefits 5 Continuing Disclosure 6 Cybersecurity 7 Suitability of Investment 7 Bankruptcy and Insolvency 7 Legislation 8 Loss of Tax Base 8 Tax Levy Procedures 8 Federal Funds Orders and State Funds Legislation 9 Other Factors 9 THE CITY 9 City Organization and Services 9 Community Life 9 Education 10 Transportation 10 SOCIOECONOMIC INFORMATION 10 Population 10 Employment 11 Housing 12 Income 12 Retail Sales 13 THE PROJECT 14 DEFAULT RECORD 14 SHORT-TERM BORROWING AND ADDITIONAL GENERAL OBLIGATION DEBT 14 DEBT INFORMATION 14 Debt Limitation 14 DIRECT DEBT 15 GENERAL OBLIGATION DEBT(/)(2) 16 STATEMENT OF BONDED INDEBTEDNESS(/)(2) 17 OTHER OBLIGATIONS 17 PROPERTY ASSESSMENT AND TAX INFORMATION 17 Property Tax Assessment 17 PERCENTAGES FOR TAXABLE VALUATION AFTER ROLLBACKS(1) 18 BUILDING PERMITS 18 Property Tax Collection 18 Levy Limits 20 Tax Levy Procedures 21 Utility Property Tax Replacement 21 Tax Increment Financing 22 Legislation 22 FINANCIAL INFORMATION 23 Financial Reports 23 No Consent or Updated Information Requested of the Auditor 23 (i) Summary Financial Information 24 REGISTRATION, TRANSFER AND EXCHANGE 27 TAX MATTERS 28 Tax Exemption 28 NOT Qualified Tax Exemption Obligations 28 Discount and Premium Bonds 29 Other Tax Advice 29 Audits 29 Reporting and Withholding 29 Tax Legislation 29 Enforcement 30 The Opinion 30 Bond Counsel Review 30 CONTINUING DISCLOSURE 31 OPTIONAL REDEMPTION 31 LITIGATION 31 LEGAL MATTERS 32 OFFICIAL STATEMENT AUTHORIZATION 32 INVESTMENT RATING 32 UNDERWRITING 33 MUNICIPAL ADVISOR 33 MISCELLANEOUS 33 APPENDIX A -FISCAL YEAR 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT APPENDIX B -DESCRIBING BOOK -ENTRY -ONLY ISSUANCE APPENDIX C -DRAFT FORM OF BOND COUNSEL OPINION APPENDIX D -DRAFT FORM OF CONTINUING DISCLOSURE CERTIFICATE OFFICIAL BID FORM OFFICIAL TERMS OF OFFERING Exhibit A — Example Issue Price Certificate City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 BOND ISSUE SUMMARY This Bond Issue Summary is expressly qualified by the entire Official Statement, including the Official Terms of Offering and the Official Bid Form, which are provided for the convenience of potential investors and should be reviewed in their entirety by potential investors. Issuer: City of Iowa City, Johnson County, Iowa. Issue: $10,255,000* General Obligation Bonds, Series 2022. Dated Date: Date of delivery (expected to be on or about June 1, 2022). Interest Due: Each June 1 and December 1, commencing December 1, 2022. Principal Due: Serially each June 1, commencing June 1, 2023 through 2032, as detailed on the cover page of this Official Statement. Optional Redemption: Bonds maturing on or after June 1, 2029, are callable at the option of the City on any date on or after June 1, 2028, at a price of par plus accrued interest. See "OPTIONAL REDEMPTION" herein. Authorization: The Bonds are being issued pursuant to authority established in Code of Iowa, 2021 as amended, Chapter 384 (the "Act"), and all laws amendatory thereof and supplementary thereto, and in conformity with a resolution (the "Resolution" or the "Bond Resolution") of the City duly passed and approved. Security: The Bonds are valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable real property within the corporate limits of the City without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors' rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. Investment Rating: An investment rating for the Bonds has been requested from Moody's Investors Service, New York, New York. See "INVESTMENT RATING" herein. Purpose: Tax Matters: The proceeds of the Bonds will be used to: (i) finance the cost of various essential and general corporate purpose capital improvements, and (ii) pay the costs of issuing the Bonds. See "THE PROJECT" herein. Ahlers & Cooney, P.C., Des Moines, Iowa, will provide an opinion as to the tax exemption of the Bonds as discussed under "TAX MATTERS" in this Official Statement. Interest on the Bonds is not exempt from present State of Iowa income taxes. See APPENDIX C for a draft form of legal opinion for the Bonds. Bond Registrar/Paying Agent: U.S. Bank Trust Company, National Association, St. Paul, Minnesota (the "Registrar"). Delivery: The Bonds are expected to be delivered on or about June 1, 2022. Book -Entry Form: Denomination: Municipal Advisor: *Subject to change. The Bonds will be registered in the name of Cede & Co. as nominee for The Depository Trust Company ("DTC"), New York, New York. DTC will act as securities depository of the Bonds. See APPENDIX B herein. $5,000 or integral multiples thereof. Speer Financial, Inc., Waterloo, Iowa and Chicago, Illinois. 1 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Megan Alter Pauline Taylor CITY OF IOWA CITY Johnson County, Iowa Bruce Teague Mayor Council Members Laura Bergus John Thomas Officials Shawn Harmsen Janice Weiner Geoff Fruin Kellie Fruehling City Manager City Clerk Nicole Davies Eric Goers, Esq. Finance Director City Attorney SECURITY AND SOURCE OF PAYMENT Pursuant to the Resolution and the Act, the Bonds and the interest thereon are general obligations of the City, and all taxable property within the corporate boundaries of the City is subject to the levy of taxes to pay the principal of and interest on the Bonds without constitutional or statutory limitation as to rate or amount. For a description of certain constitutional limits on the issuance of general obligation debt by the City, see "Debt Limitation" herein. Section 76.2 of the Code of Iowa provides that when an Iowa political subdivision issues general obligation bonds, the governing authority of such political subdivision shall, by resolution adopted before issuing the bonds, provide for the assessment of an annual levy upon all the taxable real property in the political subdivision sufficient to pay the interest and principal of the bonds. A certified copy of this resolution shall be filed with the County Auditor in which the City is located, giving rise to a duty of the County Auditor to annually enter this levy for collection from the taxable real property within the boundaries of the City, until funds are realized to pay the Bonds in full. For the purpose of providing for the levy and collection of a direct annual tax sufficient to pay the principal of and interest on the Bonds as the same become due, the Resolution provides for the levy of a tax sufficient for that purpose on all the taxable real property in the City in each of the years while the Bonds are outstanding. The City shall file a certified copy of the Resolution with the County Auditor, pursuant to which the County Auditor is instructed to enter for collection and assess the tax authorized. When annually entering such taxes for collection, the County Auditor shall include the same as a part of the tax levy for Debt Service Fund purposes of the City and when collected, the proceeds of the taxes shall be converted into the Debt Service Fund of the City and set aside therein as a special account to be used solely and only for the payment of the principal of and interest on the Bonds and for no other purpose whatsoever. 2 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Nothing in the Resolution authorizing the Bonds prohibits or limits the ability of the City to use legally available moneys other than the proceeds of the general ad valorem property taxes levied as described in the preceding paragraph to pay all or any portion of the principal of or interest on the Bonds. If and to the extent such other legally available moneys are used to pay the principal of or interest on the Bonds, the City may, but shall not be required to, (a) reduce the amount of taxes levied for such purpose, as described in the preceding paragraph; or (b) use proceeds of taxes levied, as described in the preceding paragraph, to reimburse the fund or account from which such other legally available moneys are withdrawn for the amount withdrawn from such fund or account to pay the principal of or interest on the Bonds. BONDHOLDERS' RISKS An investment in the Bonds is subject to certain risks. No person should purchase the Bonds unless such person understands the risks described below and is willing to bear those risks. There may be other risks not listed below which may adversely affect the value of the Bonds. In order to identify risk factors, make an informed investment decision, and if the Bonds are an appropriate investment, potential investors should be thoroughly familiar with this entire Official Statement (including the Appendices hereto). Potential Impact of The Coronavirus Beginning in early 2020, a strain of coronavirus commonly known as COVID-19 began to spread globally, negatively affecting global, state, and local economies and possibly sparking a recession. The State of Iowa may suffer material adverse consequences from the continued spread of COVID-19, which could affect the amount of State revenues appropriated to municipalities, including the City. The spread of the virus could reduce sales tax and other revenue collections, property valuations and other revenue sources dependent on local business activity. The City did not experience material reductions in revenue or material increases in expenses in fiscal years 2020 and 2021 due to material COVID-19-related financial impacts and currently expects that any material COVID-19-related financial impacts are expected to be covered by federal funding. Lower hotel/motel tax collections, reduced parks and recreation, senior center and other program fees, and reduced fine and permit revenues have negatively impacted the City's general fund. Other impacted funds include Transit and Water. However, the City expects that any material COVID-19 related financial impacts to these funds are expected to be covered by federal funding or mitigated by expenditure cuts. In fiscal year 2021, the City received over $6.9 million in CARES Act funds, which was used to offset revenue losses. The City anticipates receipt of $18.3 million in American Rescue Act funds, payable in fiscal years 2022 and 2023. The City has established priorities for these funds and has awarded $939,000 to subrecipients for mental health services. It is too soon, however, to fully predict what COVID-19-related financial impacts the City may incur and whether any such financial impacts will be material. The City cannot predict whether continued spread of the disease will materially impact its financial condition, in fiscal year 2022 or beyond. The spread of the virus could negatively affect the City's financial condition, including, among others, lower property values, a delay in property tax collections, and other unpredicted unforeseen consequences, which may affect the City's ability to pay principal of and interest on the Bonds. See "SECURITY AND SOURCE OF PAYMENT" herein. This information is based on current information available to the City that may be incomplete and unknown. This information was derived using certain assumptions and methodologies and includes unaudited financial information and projections. Some of this information is forward-looking and subject to change. 3 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Secondary Market There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that such Bonds can be sold for any particular price. Occasionally, because of general market conditions or because of adverse history of economic prospects connected with a particular issue, secondary marketing practices in connection with a particular bond or note issue are suspended or terminated. Additionally, prices of bond or note issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price of the Bonds. EACH PROSPECTIVE PURCHASER IS RESPONSIBLE FOR ASSESSING THE MERITS AND RISKS OF AN INVESTMENT IN THE BONDS AND MUST BE ABLE TO BEAR THE ECONOMIC RISK OF SUCH INVESTMENT. THE SECONDARY MARKET FOR THE BONDS, IF ANY, COULD BE LIMITED. Ratings Loss Moody's Investors Service, Inc. ("Moody's") has assigned a rating of " " to the Bonds. Generally, a rating agency bases its rating on the information and materials furnished to it and on investigations, studies and assumptions of its own. There is no assurance that the rating will continue for any given period of time, or that such rating will not be revised, suspended or withdrawn, if, in the judgment of Moody's, circumstances so warrant. A revision, suspension or withdrawal of a rating may have an adverse effect on the market price of the Bonds. Various factors, including additional regulation of rating agencies could materially alter the methodology, rating levels, and types of ratings available, for example, and these changes, if ever, could materially affect the market value of the Bonds. Redemption Prior to Maturity In considering whether to make an investment in the Bonds, it should be noted the Bonds are subject to optional redemption, as outlined herein, without Bondholder discretion or consent. See "OPTIONAL REDEMPTION" herein. Forward -Looking Statements This Official Statement contains statements relating to future results that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. When used in this Official Statement, the words "estimate," "forecast," "intend," "expect" and similar expressions identify forward-looking statements. Any forward-looking statement is subject to uncertainty. Accordingly, such statements are subject to risks that could cause actual results to differ, possibly materially, from those contemplated in such forward-looking statements. Inevitably, some assumptions used to develop forward-looking statements will not be realized or unanticipated events and circumstances may occur. Therefore, investors should be aware that there are likely to be differences between forward-looking statements and the actual results. These differences could be material and could impact the availability of funds of the City to pay debt service when due on the Bonds. Tax Matters, Bank Qualification and Loss of Tax Exemption As discussed under the heading "TAX MATTERS" herein, the interest on the Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date of delivery of the Bonds, as a result of acts or omissions of the City in violation of its covenants in the Resolution. Should such an event of taxability occur, the Bonds would not be subject to a special prepayment and would remain outstanding until maturity or until prepaid under the prepayment provisions contained in the Bonds, and there is no provision for an adjustment of the interest rate on the Bonds. 4 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 It is possible that legislation will be proposed or introduced that could result in changes in the way that tax exemption is calculated, or whether interest on certain securities are exempt from taxation at all. Prospective purchasers should consult with their own tax advisors regarding any pending or proposed federal income tax legislation. The likelihood of any pending or future legislation being enacted or whether the currently proposed terms of any pending legislation will be altered or removed during the legislative process cannot be reliably predicted. It is also possible that actions of the City after the closing of the Bonds will alter the tax status of the Bonds, and, in the extreme, remove the tax exempt status from the Bonds. In that instance, the Bonds are not subject to mandatory prepayment, and the interest rate on the Bonds does not increase or otherwise reset. A determination of taxability on the Bonds, after closing of the Bonds, could materially adversely affect the value and marketability of the Bonds. DTC -Beneficial Owners Beneficial Owners of the Bonds may experience some delay in the receipt of distributions of principal of and interest on the Bonds since such distributions will be forwarded by the Paying Agent to DTC and DTC will credit such distributions to the accounts of the Participants which will thereafter credit them to the accounts of the Beneficial Owner either directly or indirectly through Indirect Participants. Neither the City nor the Paying Agent will have any responsibility or obligation to assure that any such notice or payment is forwarded by DTC to any Participants or by any Participant to any Beneficial Owner. In addition, since transactions in the Bonds can be effected only through DTC Participants, Indirect Participants and certain banks, the ability of a Beneficial Owner to pledge the Bonds to persons or entities that do not participate in the DTC system, or otherwise to take actions in respect of such Bonds, may be limited due to lack of a physical certificate. Beneficial Owners will be permitted to exercise the rights of registered Owners only indirectly through DTC and the Participants. See APPENDIX B — Describing Book -Entry Only Issuance. Pension and OPEB Benefits The City participates in two public pension systems, Iowa Public Employee's Retirement System (IPERS) and Municipal Fire and Police Retirement System of Iowa (MFPRSI). In fiscal year 2021, pursuant to the IPERS' required rate, the City's Regular employees (members) contributed 6.29% of covered payroll and the City contributed 9.44% of covered payroll, for a total rate of 15.73%. The City's contributions to IPERS for the year ended June 30, 2021 were $3,025,270. The City's share of the contributions, payable from the applicable funds of the City, is provided by a statutorily authorized annual levy of taxes without limit or restriction as to rate or amount. The City has always made its full required contributions to IPERS. At June 30, 2021, the City reported a liability of $27,731,863 for its proportionate share of the IPERS net pension liability. The net pension liability was measured as of June 30, 2020 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The discount rate used to measure the total pension liability was 7%. The City's proportion of the net pension liability was based on the City's share of contributions to the pension plan relative to the contributions of all IPERS participating employers. While the City's contributions to IPERS are controlled by state law, there can be no assurance the City will not be required by changes in State law to increase its contribution requirement in the future, which may have the effect of negatively impacting the finances of the City. See "APPENDIX A — AUDITED FINANCIAL STATEMENTS OF THE ISSUER" for additional information on pension and liabilities of the City. In fiscal year 2021, pursuant to the MFPRSI's required rate, the City's employees (members) contributed 9.40% of earnable compensation and the City contributed 25.31% of covered payroll. The City's contributions to MFPRSI for the year ended June 30, 2021 were $2,902,637. The City's share of the contributions, payable from the applicable funds of the City, is provided by a statutorily authorized annual levy of taxes without limit or restriction as to rate or amount. The City has always made its full required contributions to MFPRSI. 5 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 At June 30, 2021, the City reported a liability of $28,881,737 for its proportionate share of the MFPRSI net pension liability. The net pension liability was measured as of June 30, 2020 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The discount rate used to measure the total pension liability was 7.5%. The City's proportion of the net pension liability was based on the City's share of contributions to the pension plan relative to the contributions of all MFPRSI participating employers. While the City's contributions to MFPRSI are controlled by state law, there can be no assurance the City will not be required by changes in State law to increase its contribution requirement in the future, which may have the effect of negatively impacting the finances of the City. See "APPENDIX A — AUDITED FINANCIAL STATEMENTS OF THE ISSUER" hereto for additional information on pension and liabilities of the City. The City operates a single -employer self-funded medical and dental plan for all employees, which is offered to current and retired employees and their dependents. Group insurance benefits are established under Iowa Code Chapter 509A.13. No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75. The following table shows the City's total OPEB liability: Total OPEB Liability Beginning of Year $8,627,420 Changes for the year Service Cost 733,608 Interest 240,186 Difference Between Expected and Actual Experience 459,049 Changes in Assumptions 304,947 Benefit Payments (667,342) Net Changes 1,070,448 Total OPEB Liability End of Year $9,697,868 See APPENDIX A — Notes (6) and (7) herein for further discussion of the City's employee retirement benefit obligations. Bond Counsel, Disclosure Counsel, the Municipal Advisor, and the City undertake no responsibility for and make no representations as to the accuracy or completeness of the information available from IPERS or MFPRSI discussed above or included on the IPERS or MFPRSI websites, including, but not limited to, updates of such information on the State Auditor's website or links to other Internet sites accessed through the IPERS or MFPRSI websites. Continuing Disclosure A failure by the City to comply with continuing disclosure obligations (see "CONTINUING DISCLOSURE" herein) will not constitute an event of default on the Bonds. Any such failure must be disclosed in accordance with Rule 15c2-12 (the "Rule") adopted by the Securities and Exchange Commission (the "Commission") under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and may adversely affect the transferability and liquidity of the Bonds and their market price. The City will covenant in a Continuing Disclosure Certificate for the benefit of the Owners and Beneficial Owners of the Bonds to provide annually certain financial information and operating data relating to the City (the "Annual Report"), and to provide notices of the occurrence of certain enumerated events. The Annual Report is to be filed by the City no later than two hundred ten (210) days after the close of each fiscal year, commencing with the fiscal year ending June 30, 2022, with the Municipal Securities Rulemaking Board, at its internet repository named "Electronic Municipal Market Access" ("EMMA"). The notices of events, if any, are also to be filed with EMMA. See "APPENDIX D — FORM OF CONTINUING DISCLOSURE CERTIFICATE." The specific nature of the information to be contained in the Annual Report or the notices of events, and the manner in which such materials are to be filed, are summarized in "APPENDIX D — FORM OF CONTINUING DISCLOSURE CERTIFICATE." These covenants have been made in order to assist the Underwriter in complying with SEC Rule 15c2 -12(b)(5) (the "Rule"). 6 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Cybersecurity The City, like many other public and private entities, relies on a large and complex technology environment to conduct its operations. As such, it may face multiple cybersecurity threats including but not limited to, hacking, viruses, malware and other attacks on computer or other sensitive digital systems and networks. There can be no assurances that any security and operational control measures implemented by the City will be completely successful to guard against and prevent cyber threats and attacks. Failure to properly maintain functionality, control, security, and integrity of the City's information systems could impact business operations and/or digital networks and systems and the costs of remedying any such damage could be significant. Along with significant liability claims or regulatory penalties, any security breach could have a material adverse impact on the City's operations and financial condition. The City cannot predict whether its cyber liability policy will be sufficient in the event of a cyberattack. However, the Bonds are secured by an unlimited ad valorem property tax as described herein. See "SECURITY AND SOURCE OF PAYMENT" herein. Suitability of Investment The interest rate borne by the Bonds is intended to compensate the investor for assuming the risk of investing in the Bonds. Each prospective investor should carefully examine this Official Statement and its own financial condition to make a judgment as to its ability to bear the economic risk of such an investment, and whether or not the Bonds are an appropriate investment for such investor. Bankruptcy and Insolvency The rights and remedies provided in the Resolution may be limited by and are subject to the provisions of federal bankruptcy laws, to other laws or equitable principles that may affect the enforcement of creditors' rights, to the exercise of judicial discretion in appropriate cases and to limitations in legal remedies against exercise of judicial discretion in appropriate cases and to limitations on legal remedies against municipal corporations in the State of Iowa. The various opinions of counsel to be delivered with respect to the Bonds and the Resolution, including the opinion of Bond Counsel, will be similarly qualified. If the City were to file a petition under Chapter Nine of the Federal Bankruptcy Code, the owners of the Bonds could be prohibited from taking any steps to enforce their rights under the Resolution. In the event the City fails to comply with its covenants under the Resolution or fails to make payments on the Bonds, there can be no assurance of the availability of remedies adequate to protect the interests of the holders of the Bonds. Under sections 76.16 and 76.16A of the Code of Iowa, as amended, a city, county, or other political subdivision may become a debtor under Chapter Nine of the Federal Bankruptcy Code, if it is rendered insolvent, as defined in 11 U.S.C. § 101(32)(c), as a result of a debt involuntarily incurred. As used therein, "debt" means an obligation to pay money, other than pursuant to a valid and binding collective bargaining agreement or previously authorized bond issue, as to which the governing body of the city, county, or other political subdivision has made a specific finding set forth in a duly adopted resolution of each of the following: (1) that all or a portion of such obligation will not be paid from available insurance proceeds and must be paid from an increase in general tax levy; (2) that such increase in the general tax levy will result in a severe, adverse impact on the ability of the city, county, or political subdivision to exercise the powers granted to it under applicable law, including without limitation providing necessary services and promoting economic development; (3) that as a result of such obligation, the city, county, or other political subdivision is unable to pay its debts as they become due; and (4) that the debt is not an obligation to pay money to a city, county, entity organized pursuant to Chapter 28E of the Code of Iowa, or other political subdivision. 7 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Legislation From time to time, there are proposals pending in Congress and in the Iowa General Assembly that could, if enacted, alter or amend one or more of the matters described herein in certain respects or would adversely affect the market value of the Bonds, or otherwise prevent holders of the Bonds from realizing the full benefit of the tax exemption of interest on the Bonds. Further such proposals may impact the marketability or market value of the Bonds simply by being proposed. It cannot be predicted whether or in what forms any of such proposals, either pending or that may be introduced, may be enacted and there can be no assurance that such proposals will not apply to the Bonds. In addition regulatory actions are from time to time announced or proposed, and litigation threatened or commenced, which if implemented or concluded in a particular manner, could adversely affect the market value, marketability or tax status of the Bonds. It cannot be predicted whether any such regulatory action will be implemented, how any particular litigation or judicial action will be resolved, or whether the Bonds would be impacted thereby. During the 2019 legislative session, the Iowa General Assembly passed Senate File 634 which was later signed into law by the Governor. This bill modifies the process for hearing and approval of the total maximum property tax dollars under certain levies in the City budget, including levies for the General Fund, the Emergency Fund, Trust and Agency Funds for pensions, insurance, transit, civic centers, certain bridges, sanitary disposal, and emergency management. The bill also includes a provision that requires the affirmative vote of 2/3 of the City Council when the maximum property tax dollars under these levies exceed an amount determined under a prescribed formula. The bill does not change the process for hearing and approval of the Debt Service Levy pledged for repayment of the Bonds. Loss of Tax Base Economic and other factors beyond the City's control, such as economic recession, deflation of property values, or financial difficulty or bankruptcy by one or more major property taxpayers, or the complete or partial destruction of taxable property caused by, among other eventualities, earthquake, flood, fire or other natural disaster, could cause a reduction in the assessed value within the corporate boundaries of the City. In addition, the State of Iowa has been susceptible to tornados, flooding and other extreme weather wherein winds and flooding have from time to time caused significant damage, which if such events were to occur, may have an adverse impact on the City's financial position. The City believes it has employed adequate risk -mitigation strategies to limit future damage due to climate change or natural disaster, but it is impossible to predict the impact, cost or necessity of future recovery or mitigation efforts. Tax Levy Procedures The Bonds are general obligations of the City, payable from and secured by a continuing ad valorem tax levied against all of the taxable real property within the corporate limits of the City. See "PROPERTY ASSESSMENT AND TAX INFORMATION" herein for more details. As part of the budgetary process each fiscal year, the City will have an obligation to request a debt service levy to be applied against all of the taxable real property within the corporate limits of the City. A failure on the part of the City to make a timely levy request or a levy request by the City that is inaccurate or is insufficient to make full payments of the debt service of the Bonds for a particular fiscal year may cause Bondholders to experience delay in the receipt of distributions of principal of and/or interest on the Bonds. In the event of a default in the payment of principal of or interest on the Bonds, there is no provision for acceleration of maturity of the principal of the Bonds. Consequently, the remedies of the owners of the Bonds (consisting primarily of an action in the nature of mandamus requiring the City and certain other public officials to perform the terms of the Bond Resolution) may have to be enforced from year to year. 8 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Federal Funds Orders and State Funds Legislation Various federal executive orders, and Iowa Code Chapter 27A (collectively "ICE Enforcement Initiatives"), impose requirements intended to ensure compliance with the federal immigration detainment processes. The ICE Enforcement Initiatives impose various penalties for non-compliance, including the loss of state and/or federal funding under certain circumstances. The loss of state and/or federal funds in any significant amount could negatively impact the City's overall financial position and may affect its rating and could slow down completion of certain of the Projects. However, the Bonds are secured by an unlimited ad valorem property tax and are not secured by state or federal funds. See "SECURITY AND SOURCE OF PAYMENT" herein. Other Factors An investment in the Bonds involves an element of risk. The foregoing is intended only as a summary of certain risk factors attendant to an investment in the Bonds. In order for potential investors to identify risk factors and make an informed investment decision, potential investors should become thoroughly familiar with this entire Official Statement and the Appendices hereto. THE CITY The City is located in East Central Iowa and was incorporated in 1853 under the laws of the State of Iowa (the "State") and operates under the Council/Manager form of government. The 2020 Census reported population at 74,828. The City is the largest City in Johnson County (the "County") and serves as the County seat. City Organization and Services The City is governed by a seven member Council and each member serves a four-year term. Elections are held every two years, allowing for continuation in office of at least three members in each biennial election. The Council members are elected at large, but three members are nominated from specific districts and the remaining four members are nominated at large. The Mayor is elected by the Council from its own members for a two-year term. The City Manager, City Attorney and City Clerk are appointed by the City Council. The City Manager is the chief administrative officer for the City. Currently the City employs approximately 565 full-time, 62 permanent part-time and 258 temporary employees, including a police force of 78 sworn personnel and a fire department of 64 fire fighters. The City considers its employee relations to be good. The City currently maintains labor agreements with the American Federation of State, County, and Municipal Employees ("AFSCME") which contract expires June 30, 2026; with Police ("PLRO") which contract expires June 30, 2025; and Fire fighters ("IAFF") which contract expires June 30, 2024. The City provides a broad range of services to its citizens including general government, public safety, streets, parks, and cultural facilities. It also operates an airport, a mass transportation system, parking facilities, water treatment, wastewater treatment, storm water collection, sanitation collection and disposal (including landfill operations), and a housing authority. Community Life The City was the first North American City to be awarded the City of Literature in North America by UNESCO in 2008, which has a goal of fostering cultural diversity. The City hosts a variety of cultural events, such as the Iowa Writers' Workshop, whose graduates include John Irving, Flannery O'Connor, T.C. Boyle; the International Writing Program; the Non -Fiction Writing Program; the Iowa Playwrights' Workshop; and the Iowa Summer Writing Festival. 9 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 A variety of events sponsored by the City include the Summer of the Arts program, a festival of the arts, a nationally renowned jazz festival, open-air summer movies and free concerts in the pedestrian mall. The City Book Festival, the Iowa Biennial Exhibition, and The Landlocked Film Festival are events hosted by the City. The Hancher Auditorium hosts nationally touring theater, dance and musical shows, and has commissioned more than 100 works of music, theater and dance during the last 20 years. Education Public education to the City is provided by the Iowa City Community School District (the "District"), with certified enrollment of 14,395 for Fiscal Year 2021-22. There are approximately 2,289 full and part-time employees of the District. The District owns and operates 19 pre-school sites, 21 elementary schools, three junior high schools, three comprehensive high schools, one alternative high school and a Transition Services Center (a program for special education students ages 18-21). Education is also provided through the Clear Creek — Amana Community School District, with certified enrollment of 2,728 for Fiscal Year 2021-22. Four year college programs and vocational training are available throughout the area including the University of Iowa and Kirkwood Community College. Transportation The City is approximately 115 miles east of the City of Des Moines, 20 miles southeast of the City of Cedar Rapids and 55 miles northwest of the City of Davenport. The Eastern Iowa Airport is located 20 miles from downtown Iowa City and is served by a number of national and regional air carriers. A general aviation airport, Iowa City Municipal Airport is located on the south side of the City. The Iowa Interstate Railway, and Cedar Rapids and Iowa City Railway provide the City's rail service. Bus transportation is provided by Iowa City Transit, Coralville Transit, and the University of Iowa. There is also a system of paved bicycle paths in the City along the Iowa River and some main roads in the City have paved bicycle shoulders. SOCIOECONOMIC INFORMATION The following demographic information is for the City. Additional comparisons are made with the County and the State. Population The following table reflects population trends for the City, the County and the State. Population Comparison(1) The Percent The Percent The Percent Year City Change County Change State Change 1970 46,850 n/a 72,127 n/a 2,824,376 n/a 1980 50,508 7.81% 81,717 13.30% 2,913,808 3.17% 1990 59,735 18.27% 96,119 17.62% 2,776,755 (4.70%) 2000 62,220 4.16% 111,006 15.49% 2,926,324 5.39% 2010 67,862 9.07% 130,882 17.91% 3,046,355 4.10% 2020 74,828 10.26% 152,854 16.79% 3,190,369 4.73% Note: (1) Source: U.S. Bureau of the Census. 10 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Employment Following are lists of large employers located in the City. Major City Employers(1) Approximate Name Product/Service Employment University of Iowa Education/Health Services 24,733 Iowa City Community School District Education 2,578 Veterans Administration Medical Center Health Services 2,012 Hy -Vee Grocery 1,327 Proctor and Gamble Health and Beauty Products 1,004 Mercy Hospital Health Services 912 City of Iowa City Government 840 NCS Pearson Educational Testing Services 695 ACT, Inc. Education Programs 570 Note: (1) Source: the City. The following tables show employment by industry and by occupation for the City, the County and the State as reported by the U.S. Census Bureau 2016 - 2020 American Community Survey 5 -year estimated values. Employment By Industry(1) The City The County The State Classification Number Percent Number Percent Number Percent Agriculture, forestry, fishing and hunting, and mining 303 0.7% 1,034 1.2% 60,443 3.8% Construction 1,281 3.0% 3,489 4.2% 105,449 6.5% Manufacturing 2,536 6.0% 7,189 8.6% 236,327 14.7% Wholesale trade 349 0.8% 1,418 1.7% 45,624 2.8% Retail trade 4,702 11.2% 8,939 10.7% 185,930 11.5% Transportation and warehousing, and utilities 1,526 3.7% 2,694 3.2% 80,042 5.0% Information 671 1.6% 1,219 1.5% 25,116 1.6% Finance and insurance, and real estate and rental and leasing 1,536 3.6% 3,955 4.7% 124,973 7.7% Professional, scientific, and management, and administrative and waste management services 2,891 6.9% 5,998 7.2% 119,391 7.4% Educational services, and health care and social assistance 18,626 44.2% 34,546 41.4% 391,707 24.3% Arts, entertainment, and recreation, and accommodation and food services 5,746 13.6% 8,338 10.0% 116,108 7.2% Other services, except public administration 1,294 3.1% 2,842 3.4% 70,677 4.4% Public administration 675 1.6% 1,816 2.2% 49.737 3.1% Total 42,136 100.0% 83,477 100.0% 1,611,524 100.0% Note: (1) Source: U. S. Bureau of the Census, American Community Survey 5 -Year Estimates from 2016 - 2020. Employment By Occupation(1) Classification Management, business, science, and arts occupations Service occupations Sales and office occupations Natural resources, construction, and maintenance occupations Production, transportation, and material moving occupations Total The City The County The State Number Percent Number Percent Number Percent 20,204 48.0% 40,801 48.9% 598,690 37.1% 8,687 20.6% 14,374 17.2% 255,711 15.9% 7,310 17.4% 14,926 17.9% 328,437 20.4% 1,746 4.1% 4,495 5.4% 154,293 9.6% 4,189 9.9% 8,8881 10.6% 274,393 17.0% 42,136 100.0% 83,477 100.0% 1,611,524 100.0% Note: (1) Source: U. S. Bureau of the Census, American Community Survey 5 -Year Estimates from 2016 - 2020. 11 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 The following shows the annual average unemployment rates for the City, the County, the State and the United States. Annual Average Unemployment Rates(/)(2) Calendar Year 2013 2014 2015 2016 2017 2018 2019 2020(3) 2021 2022(4) Notes: (1) (2) (3) (4) Housing The The The United City County State States 3.3% 3.4% 4.7% 7.4% 3.0% 3.1% 4.2% 6.2% 2.5% 2.6% 3.7% 5.3% 2.4% 2.6% 3.6% 4.9% 2.4% 2.4% 3.1% 4.4% 1.9% 1.9% 2.5% 1.9% 1.9% 2.6% 5.1% 4.7% 5.1% 3.8% 3.7% 4.2% 3.0% 3.2% 4.4% 3.9% 3.7% 8.1% 5.4% 4.4% Source: Iowa Workforce Development and U.S. Bureau of Labor Statistics. Not seasonally adjusted. The increase in unemployment rates may be attributable to the COVID-19 pandemic. See "BONDHOLDERS RISKS - COVID-19" herein. Preliminary rates for the month of January 2021. The U.S. Census Bureau 5 -year estimated values reported that the median value of the City's owner -occupied homes was $223,900. This compares to $238,600 for the County and $153,900 for the State. The following table represents the five year average market value of specified owner -occupied units for the City, the County and the State at the time of the 2016 - 2020 American Community Survey. Home Values(1) The City The County The State Value Number Percent Number Percent Number Percent Less than $50,000 683 4.6% 2,049 5.8% 76,339 8.4% $50,000 to $99,999 399 2.7% 1,048 3.0% 177,648 19.6% $100,000 to $149,999 1,770 12.0% 3,703 10.4% 184,881 20.4% $150,000 to $199,999 3,095 21.1% 6,111 17.3% 155,560 17.1% $200,000 to $299,999 4,932 33.6% 10,513 29.7% 175,416 19.3% $300,000 to $499,999 3,008 20.5% 8,821 24.9% 105,115 11.6% $500,000 to $999,999 772 5.2% 2,886 8.1% 26,956 3.0% $1,000,000 or more 38 0.3% 281 0.8% 5,052 0.6% Total 14,697 100.0% 35,412 100.0% 906,967 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5 -year estimates 2016 - 2020. Mortgage Status(1) The City The County The State Mortgage Status Number Percent Number Percent Number Percent Housing units with a mortgage 9,221 62.7% 23,224 65.6% 547,418 60.4% Housing units without a mortgage 5,476 37.3% 12,188 34.4% 359.549 39.6% Total 14,697 100.0% 35,412 100.0% 906,967 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5 -year estimates 2016 - 2020. Income The U.S. Census Bureau 5 -year estimated values reported that the City had a median family income of $86,192. This compares to $97,891 for the County and $79,186 for the State. The following table represents the distribution of family incomes for the City, the County and the State at the time of the 2016 - 2020 American Community Survey. 12 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Family Income(1) The City The County The State Income Number Percent Number Percent Number Percent Less than $10,000 640 4.8% 1,128 3.4% 22,207 2.8% $10,000 to $14,999 191 1.5% 411 1.3% 14,370 1.8% $15,000 to $24,999 766 5.8% 1,423 4.3% 38,824 4.8% $25,000 to $34,999 835 6.3% 1,685 5.1% 52,575 6.6% $35,000 to $49,999 1,079 8.1% 2,634 8.1% 90,256 11.3% $50,000 to $74,999 2,189 16.5% 5,010 15.3% 157,719 19.7% $75,000 to $99,999 2,001 15.1% 4,793 14.7% 138,130 17.2% $100,000 to $149,999 2,666 20.1% 7,801 23.9% 168,301 21.0% $150,000 to $199,999 1,377 10.4% 3,586 11.0% 62,349 7.8% $200,000 or more 1,505 11.4% 4.229 12.9% 56.007 7.0% Total 13,249 100.0% 32,700 100.0% 800,738 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5 -year estimates 2016 to 2020. The U.S. Census Bureau 5 -year estimated values reported that the City had a median household income of $48,148. This compares to $63,062 for the County and $61,836 for the State. The following table represents the distribution of household incomes for the City, the County and the State at the time of the 2016 - 2020 American Community Survey. Household Income(1) The City The County The State Income Number Percent Number Percent Number Percent Less than $10,000 4,316 13.7% 5,652 9.4% 64,607 5.1% $10,000 to $14,999 1,412 4.5% 2,134 3.5% 51,206 4.0% $15,000 to $24,999 3,611 11.5% 5,407 8.9% 110,143 8.6% $25,000 to $34,999 3,109 9.9% 4,998 8.3% 118,343 9.3% $35,000 to $49,999 3,858 12.3% 6,812 11.3% 167,084 13.1% $50,000 to $74,999 4,673 14.8% 9,505 15.7% 243,639 19.1% $75,000 to $99,999 3,277 10.4% 7,121 11.8% 182,007 14.3% $100,000 to $149,999 3,757 11.9% 9,821 16.3% 202,695 15.9% $150,000 to $199,999 1,728 5.5% 4,185 6.9% 70,804 5.6% $200,000 or more 1,742 5.5% 4,795 7.9% 63.413 5.0% Total 31,483 100.0% 60,430 100.0% 1,273,941 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5 -year estimates 2016 - 2020. Retail Sales The Department of Revenue of the State of Iowa provides retail sales figures based on sales tax reports for years ending June 30. The Department of Revenue figures provide recent data to confirm trends in retail sales activity in the City. Retail Taxable Sales(1) Fiscal Year Taxable Annual Percent Ending June 30 Sales Change + (-) 2012 $767,122,555 n/a 2013 793,201,342 3.40% 2014 811,039,164 2.25% 2015 838,853,686 3.43% 2016 853,258,347 1.72% 2017 874,928,988 2.54% 2018 854,538,416 (2.33%) 2019 866,389,134 1.39% 2020 832,475,900 (3.91%) 2021 858,860,019 3.17% Growth from 2012 to 2021 11.96% Note: (1) Source: the Iowa Department of Revenue. 13 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 THE PROJECT Bond proceeds will be used to: (i) finance the cost of various essential and general corporate purpose capital improvements (the "Project"), and (ii) pay the costs of issuing the Bonds. More specifically, the Project includes the financing of the costs of: (i) opening, widening, extending, grading, and drainage of the right-of-way of streets, highways, avenues, alleys and public grounds; the construction, reconstruction, and repairing of any street and streetscape improvements, with related utility work, traffic control devices, lighting, sidewalks, and the acquisition of real estate for such purposes; the rehabilitation and improvement of parks already owned, including facilities, equipment and improvements commonly found in city parks; improvements to and equipping of the Senior Center facility; the acquisition, renovation, reconstruction and equipping of City Hall and the fire station; the acquisition, installation, improving and equipping of city facilities and buildings, including building automation systems. DEFAULT RECORD The City has no record of default and has met its debt repayment obligations promptly. SHORT-TERM BORROWING AND ADDITIONAL GENERAL OBLIGATION DEBT The City has not issued tax anticipation warrants or revenue anticipation notes during the last five years to meet its short-term current year cash flow requirements. The City does not expect to issue any additional general obligation debt in calendar year 2022. DEBT INFORMATION Debt Limitation The amount of general obligation debt a political subdivision of the State of Iowa can incur is controlled by the constitutional debt limit, which is an amount equal to 5% of the actual value of taxable property within the corporate limits, taken from the last County Tax list. According to and based upon the January 1, 2020 property valuations, for taxes payable in September 2021 and March 2022, the City's debt limit, based upon said valuation, amounts to the following: *Subject to change. 2020 100% Actual Valuation of Property $7,019,346,321 Constitutional Debt Limit $ 350,967,316 Outstanding Bonds/Notes Applicable to Debt Limit: Total G.O. Debt Subject to Debt Limit $ 53,935,000* TIF Revenue Debt 11,840,000 Other Loans 210,784 Other Legal Indebtedness (TIF Rebates) 35,804,066 Total Applicable Debt $ 101,789,850* Remaining Debt Capacity $ 249,177,466* 14 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 DIRECT DEBT Summary of General Obligation and Tax Increment Debt(/)(2) (Principal Only) General Obligation: Series 2013A $ 870,000 Series 2014 2,030,000 Series 2015 2,560,000 Series 2016A 3,995,000 Series 2017A 5,145,000 Series 2018A 5,565,000 Series 2019 6,580,000 Series 2020 6,745,000 Series 2021 10,190,000 The Bonds(3) 10,255,000 Total General Obligation(3) $53,935,000 Tax Increment Financing Revenue: Series 2016E $11,840,000 Total Tax Increment $11,840,000 Notes: (1) Source: the City. (2) After the June 1, 2022 principal payments on the outstanding debt. (3) Subject to change. The remainder of this page was left blank intentionally. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 GENERAL OBLIGATION DEBT(/)(2) (Principal Only) Fiscal Year Ending Series June 30 2013A 2023 $870,000 2024 0 2025 0 2026 0 2027 0 2028 0 2029 0 2030 0 2031 0 2032 0 Total $870,000 Fiscal Year Outstanding Ending General Obligation June 30 Debt 2023 $ 8,810,000 $ 1,315,000 2024 7,685,000 995,000 2025 6,630,000 995,000 2026 5,860,000 995,000 2027 4,910,000 995,000 2028 3,865,000 995,000 2029 2,885,000 995,000 2030 1,925,000 995,000 2031 1,110,000 995,000 2032 0 980,000 Total $43,680,000 $10,255,000 Series 2014A $1,000,000 1,030,000 0 0 0 0 0 0 0 0 $2,030,000 Series 2015 $ 830,000 850,000 880,000 0 0 0 0 0 0 0 $2,560,000 Total The General Obligation Bonds(3) Debt(3) Notes: (1) (2) (3) $10,125,000 8,680,000 7,625,000 6,855,000 5,905,000 4,860,000 3,880,000 2,920,000 2,105,000 980,000 $53,935,000 Source: the City. After the June 1, 2021 principal payments on the outstanding debt. Subject to change. Series 2016A $ 965,000 985,000 1,010,000 1,035,000 0 0 0 0 0 0 $3,995,000 Series 2017A $ 980,000 1,000,000 1,025,000 1,055,000 1,085,000 0 0 0 0 0 $5,145,000 Cumulative Retirement(3) Amount Percent $10,125,000 18.77% 18,805,000 34.87% 26,430,000 49.00% 33,285,000 61.71% 39,190,000 72.66% 44,050,000 81.67% 47,930,000 88.87% 50,850,000 94.28% 52,955,000 98.18% 53,935,000 100.00% Series 2018A $ 875,000 895,000 915,000 940,000 960,000 980,000 0 0 0 0 $5,565,000 Principal & Interest(3) $11,623,350 9,879,113 8,575,725 7,581,275 6,419,263 5,204,600 4,101,363 3,047,525 2,171,638 1,002,050 $59,605,899 The remainder of this page was left blank intentionally. Series Series Series 2019 2020 2021 $ 955,000 $1,200,000 $ 1,135,000 985,000 805,000 1,135,000 875,000 790,000 1,135,000 905,000 790,000 1,135,000 940,000 790,000 1,135,000 960,000 790,000 1,135,000 960,000 790,000 1,135,000 0 790,000 1,135,000 0 0 1,110,000 0 0 0 $6,580,000 $6,745,000 $10,190,000 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 STATEMENT OF BONDED INDEBTEDNESS(1)(2) City Actual Value, January 1, 2020 $7,019,346,321 City Taxable Value, January 1, 2020 $4,393,979,723 Per Capita Applicable Ratio to City Ratio to City (2020 Pop. Total Percent Amount Actual Value Taxable Value 74,828 ) Direct Bonded Debt(3) $ 53,935,000 100.00% $ 53,935,000 0.77% 1.23% $ 720.79 TIF Revenue Debt 11,840,000 100.00% 11,840,000 0.17% 0.27% 158.23 Overlapping Debt: Iowa City Community School District $174,250,450 58.74% $102,354,450 1.46% 2.33% 1,367.86 Clear Creek-Amana Community School Dist82,015,000 0.03% 24,605 0.00% 0.00% 0.33 Kirkwood Community College(4) 77,145,000 14.84% 11,448,318 0.16% 0.26% 153.00 Johnson County 9,577,400 43.39% 4,155,634 0.06% 0.09% 55.54 Total Applicable Overlapping Bonded Debt $117,983,006 1.68% 2.69% $1,576.72 Total Direct and Overlapping Bonded Debt(3) $183,758,006 2.62% 4.18% $2,455.74 Per Capita Actual Value $93,806.41 Per Capita Taxable Value $58,721.06 Notes: (1) Source: the City, Audited Financial Statements and Treasurer of the State of Iowa - Outstanding Obligations Report, debt as of June 30, 2021 for the School Districts, Community College and County. (2) As of the date of issuance for the Direct Bonded Debt and June 30, 2021 for Overlapping Debt. (3) Subject to change. (4) Excludes $43,840,000 in Industrial New Jobs Training Certificates, which are expected to be paid by proceeds from anticipated job credits from withholding taxes. OTHER OBLIGATIONS Revenue Debt Payable from Net Revenues of the Municipal Water System: Series 2012C $ 540,000 Series 2016D 1,535,000 Series 2017C 3,305.000 Total(1) $5,380,000 Revenue Debt Payable from Net Revenues of the Municipal Sewer System: Series 2017B $2,085,000 Total(1) $2,085,000 Note: (1) Source: the City. PROPERTY ASSESSMENT AND TAX INFORMATION Property Tax Assessment In compliance with Section 441.21 of the Code of Iowa, as amended, the State Director of Revenue annually directs all county auditors to apply prescribed statutory percentages to the assessments of certain categories of real property. The final values, called Actual Valuation, are then adjusted by the County Auditor. Taxable Valuation subject to tax levy is then determined by the application of State determined rollback percentages, principally to residential property. Beginning in 1978, the State required a reduction in Actual Valuation to reduce the impact of inflation on its residents. The resulting value is defined as the Taxable Valuation. Such rollback percentages may be changed in future years. Certain historical rollback percentages for residential, multi -residential, agricultural and commercial valuations are as follows: 17 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 PERCENTAGES FOR TAXABLE VALUATION AFTER ROLLBACKS(1) Percentages for Taxable Valuation After Rollbacks(1) Multi- Ag Land Commercial Fiscal Year Residential Residential(2) & Buildings & Industrial 2013/14 52.8166% N/A 59.9334% 100.0000% 2014/15 54.4002% N/A 43.3997% 95.0000% 2015/16 55.7335% N/A 44.7021% 90.0000% 2016/17 55.6259% 86.2500% 46.1068% 90.0000% 2017/18 56.9391% 82.5000% 47.4996% 90.0000% 2018/19 55.6209% 78.7500% 54.4480% 90.0000% 2019/20 56.9180% 75.0000% 56.1324% 90.0000% 2020/21 55.0743% 71.2500% 81.4832% 90.0000% 2021/22 56.4094% 67.5000% 84.0305% 90.0000% 2022/23 54.1302% 63.7500% 89.0412% 90.0000% Notes: (1) Source: the Iowa Department of Revenue. (2) New category beginning with fiscal year 2017, to be phased into residential category with valuations beginning January 1, 2022, per House File 418 signed into law on March 8, 2021. Property is assessed on a calendar year basis. The assessments finalized as of January 1 of each year are applied to the following tax year. For example, the assessments finalized on January 1, 2020, are used to calculate tax liability for the tax year starting July 1, 2021 through June 30, 2022. BUILDING PERMITS New construction building permits valuation have averaged $99,672,232 annually over the last 4 years in the City, excluding the value of land. City Building Permits(1) (Excludes the Value of Land) Calendar Year: 2018 2019 2020 2021 2022(2) New Construction No. of New Permits 151 120 120 159 12 Valuation: $115,872,543 $134,485,833 $51,863,761 $ 96,466,791 $5,431,904 Remodeling Repair and Additions: No. of New Permits. 467 484 430 421 47 Valuation: $ 76,942,267 $ 97,036,048 $35,438,412 $ 39,023,795 $3,213,598 Total Permits 618 604 550 580 59 Total Valuations $192,814,810 $231,521,881 $87,302,173 $135,490,596 $8,645,502 Notes: (1) Source: the City. (2) As of February 28, 2022. Property Tax Collection Each county is required by State law to collect all tax levies within its jurisdiction and remit, before the fifteenth of each month, the amount collected through the last day of the preceding month to underlying units of government, including the City. Property tax payments are made at the office of each county treasurer in full or one-half by September 30 and March 31, pursuant to the Code of Iowa, Sections 445.36 and 445.37. Where the first half of any property tax has not been paid by October 1, such installment becomes delinquent. If the second installment is not paid, it becomes delinquent on April 1. Delinquent taxes and special assessments are subject to a penalty at the rate of one and one-half percent per month, to a maximum of eighteen percent per annum. 18 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 If taxes are not paid when due, the property may be offered at the regular tax sale on the third Tuesday of June following the delinquency date. Purchasers at the tax sale must pay an amount equal to the taxes, special assessments, interest and penalties due on the property, and funds so received are applied to the payment of taxes. A property owner may redeem from the regular tax sale, but failing redemption within two years, the tax sale purchaser is entitled to a deed which in general conveys the title free and clear of all liens except future installments of taxes. PROPERTY VALUATIONS AND TREND OF VALUATIONS ACTUAL (100%) VALUATIONS FOR THE CITY(1) Fiscal Year: Property Class Levy Year: Residential Agricultural Commercial Industrial Multi -residential Railroads Utilities without Gas and Electric(2) Gas and Electric Utility(2) Less: Military Exemption Total Percent Change +(-) Notes: 2018/19 2017 $4,279,194,820 2,626,150 964,588,039 74,013,639 482,118,763 3,549,414 7,099,293 97,050,716 (2,579,836) $5,907,660,998 7.52%(3) 2019/20 2018 $4,431,104,380 2,539,080 1,000,704,323 79,346,989 502,252,347 3,601,348 7,386,408 109,124,421 (2,489,088) $6,133,570,208 3.82% 2020/21 2019 $4,995,816,750 1,748,000 1,104,820,749 80,669,700 548,053,873 4,488,469 6,152,547 118,583,613 (2,435,380) $6,857,898,321 11.81% (1) Source: Iowa Department of Management. (2) See "PROPERTY TAX INFORMATION - Utility Property Tax Replacement" herein. (3) Based on 2016 Actual Valuation of $5,494,476,735. 2021/22 2020 $5,140,954,110 1,727,980 1,115,028,021 80,001,410 549,444,612 4,072,190 4,339,508 126,171,274 (2,392,784) $7,019,346,321 2.35% Preliminary 2022/23 2021 $5,365,850,652 1,574,220 1,107,017, 980 79,499,810 554,767,665 4,380,355 2,779,716 134,787,151 (2,261,292) $7,248,396,257 3.26% For the January 1, 2021 levy year, the City's Taxable Valuation was comprised of approximately 66% residential, 23% commercial, 8% multi -residential, 2% industrial, 1% utilities and less than 1% agriculture and military exemption. PROPERTY VALUATIONS AND TREND OF VALUATIONS TAXABLE ("ROLLBACK") VALUATIONS FOR THE CITY(1) Property Class Residential Agricultural Commercial Industrial Multi -residential Railroads Utilities without Gas and Electric(2) Gas and Electric Utility(2) Less: Military Exemption Total Percent Change +(-) Fiscal Year: Levy Year: 2018/19 2017 $2,380,126,625 1,429,547 868,129,247 66,612,275 379,668,606 3,194,473 7,099,293 41,797,475 (2,579,836) $3,745,477,705 5.72%(3) 2019/20 2018 $2,522,095,595 1,425,151 900,633,903 71,412,290 376,689,677 3,241,213 7,386,408 42,719,065 (2,489,088) $3,923,114,214 4.74% 2020/21 2019 $2,751,410,912 1,424,328 994,338,692 72,602,730 390,488,458 4,039,622 6,152,547 40,156,239 (2,435,380) $4,258,178,148 8.54% Notes: (1) Source: Iowa Department of Management. (2) See "PROPERTY TAX INFORMATION - Utility Property Tax Replacement" herein. (3) Based on 2016 Taxable Valuation of $3,542,852,278. 19 2021/22 2020 $2,899,981,623 1,452,029 1,003,525,240 72,001,269 370,875,229 3,664,971 4,276,538 50,595,608 (2,392,784) $4,393,979,723 3.19% Preliminary 2022/23 2021 $2,904,545,542 1,401,705 996,316,203 71,549,829 353,664,442 3,942,320 2,779,716 44,017,962 (2,261,292) $4,375,956,427 (0.41 %) City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 LEVIES AND TAX COLLECTIONS(1) (Amounts Expressed in Thousands) The following shows the trend in the City's tax extensions and collections. Levy Fiscal Amount Amount Percent Year Year Levied Collected(2) Collected 2011 2012-13 $50,407 $50,142 99.47% 2012 2013-14 50,307 49,836 99.06% 2013 2014-15 51,609 51,295 97.16% 2014 2015-16 52,034 52,074 100.08% 2015 2016-17 55,330 55,331 100.00% 2016 2017-18 56,458 56,347 99.80% 2017 2018-19 59,174 59,254 100.14% 2018 2019-20 60,297 58,972 97.80% 2019 2020-21 65,849 66,714 101.31% 2020 2021-22 66,912 - - In Collection - - Notes: (1) Source: the State of Iowa Department of Management and the City. Does not include Levies or Collections for Utility Replacement. Does not include levies and collections for the City's tax increment finance district. (2) Includes delinquent taxes. LARGER TAXPAYERS(1) Levy Year 2020 Taxpayer Name Business/Service Taxable Valuation(2) Rise at Riverfront Crossings, LLC Apartments $ 44,751,384 MidAmerican Energy Utility 37,358,702 BBCS-Hawkeye Housing LLC Real Estate Management/Apartments 28,298,490 Tailwind Iowa City, LLC Real Estate Development 23,997,635 Hollingsworth Capital Partners -Iowa, LLC Industrial Property Development 22,477,032 American College Testing, Inc (aka ACT, Inc.) Commercial Property 22,454,556 Dealer Properties IC LLC Commercial Property 20,522,421 Procter & Gamble LLC Industrial Property 16,764,588 National Computer Systems Computers 16,742,682 Webber -Iowa LLC Real Estate 15,952,128 Total $249,319,618 Ten Larger Taxpayers as Percent of City's 2020 Taxable Valuation ($4,393,979,723) 5.67% Notes: (1) Source: the County. (2) Every effort has been made to seek out and report the larger taxpayers. However, many of the taxpayers listed contain multiple parcels and it is possible that some parcels and their valuations have been overlooked. Levy Limits Normal municipal operations and maintenance costs are generally funded through the corporate property tax levy. Iowa State Code does not allow the municipal general fund to be taxed above $8.10 per thousand dollars of taxable value in any one year. In addition to the General Fund, there are several other tax funds that the City can create and use for specific purposes. 20 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 TAX RATES Levy Years 2016 - 2020(1)(2) (Per $1,000 Actual Valuation) Fiscal Year: 2017/18 2018/19 2019/20 2020/21 2021/22 Levy Year: 2016 2017 2018 2019 2020 City: General Fund $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 Emergency Levy 0.00000 0.00000 0.00000 0.24000 0.24000 Debt Service Fund 3.57846 3.22846 2.97846 2.57846 2.47846 Employee Benefits 3.14415 3.34415 3.24415 3.34415 3.34415 Capital Improvement 0.00000 0.00000 0.00000 0.00000 0.00000 Other 1.51044 1.51044 1.51044 1.51044 1.51044 Total City $16.33305 $16.18305 $15.83305 $15.77305 $15.67305 Johnson County $ 6.85143 $ 6.53594 $ 6.49278 $ 6.34581 $ 6.16774 Iowa City Community School District 13.95855 14.85629 14.79097 14.83935 14.85066 Kirkwood 1.13174 1.20354 1.21331 1.25730 1.31195 Other 0.33036 0.30557 0.27066 0.33110 0.32744 Total Tax Rate(3) $38.60513 $39.08439 $38.60077 $38.54661 $38.33084 Notes: (1) Source: Iowa Department of Management. (2) Does not include the tax rate for agriculture. (3) Taxpayers in the Iowa City Community School District area. Tax Levy Procedures The Bonds are general obligations of the City, payable from and secured by a continuing ad valorem tax levied against all of the taxable real property within the corporate limits of the City. As part of the budgetary process each fiscal year, the City will have an obligation to request a debt service levy to be applied against all of the taxable real property within the corporate limits of the City. A failure on the part of the City to make a timely levy request or a levy request by the City that is inaccurate or is insufficient to make full payments of the debt service of the Bonds for a particular fiscal year may cause Bond holders to experience delay in the receipt of distributions of principal of and/or interest on the Bonds. In the event of a default in the payment of principal of or interest on the Bonds, there is no provision for acceleration of maturity of the principal of the Bonds. Consequently, the remedies of the owners of the Bonds (consisting primarily of an action in the nature of mandamus requiring the City and certain other public officials to perform the terms of the resolution for the Bonds) may have to be enforced from year to year. Notwithstanding the foregoing, Iowa Code section 76.2 provides when an Iowa political subdivision issues general obligation bonds, "the governing authority of these political subdivisions before issuing bonds shall, by resolution, provide for the assessment of an annual levy upon all the taxable property in the political subdivision sufficient to pay the interest and principal of the bonds within a period named not exceeding twenty years. A certified copy of this resolution shall be filed with the county auditor or auditors of the counties in which the political subdivision is located; and the filing shall make it a duty of the auditor(s) to enter annually this levy for collection from the taxable property within the boundaries of the political subdivision until funds are realized to pay the bonds in full." Utility Property Tax Replacement Property owned by entities involved primarily in the production, delivery, service and sale of electricity and natural gas ("Utilities") pay a replacement tax based upon the delivery of energy by Utilities in lieu of property taxes. All replacement taxes are allocated among local taxing bodies by the State Department of Revenue and the Department of Management. This allocation is made in accordance with a general allocation formula developed by the Department of Management on the basis of general property tax equivalents. Utility properties paying the replacement tax are exempt from the levy of property tax by political subdivisions. In addition to the replacement tax, Utility property will continue to be valued by a special method as provided in the statute and taxed at the rate of three cents per one thousand dollars for the general fund of the State. 21 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 By statute, the replacement tax collected by the State and allocated among local taxing bodies (including the City) shall be treated as property tax when received and shall be disposed of by the county treasurer as taxes on real estate. It is possible that the general obligation debt capacity of the City could be adjudicated to be proportionately reduced in future years if Utility property were determined to be other than "taxable property" for purposes of computing the City's debt limit under Article XI of the Constitution of the State of Iowa. There can be no assurance that future legislation will not (i) operate to reduce the amount of debt the City can issue or (ii) adversely affect the City's ability to levy taxes in the future for the payment of the principal of and interest on its outstanding debt obligations, including the Bonds. Approximately 1% of the City's levy year 2021 taxable valuation currently is utility property. Tax Increment Financing The Code of Iowa currently authorizes the use of two types of tax increment financing by local taxing districts in the State of Iowa. The first type allows local governments to establish TIF districts for the purposes of financing designated urban renewal projects which contribute to the urban redevelopment and economic development of the immediate area. The taxable valuation used for this type of TIF district in the City for levy year 2021 is $133,492,758. The second type of tax increment financing was authorized by state legislative action in the mid -1980's. The area community colleges can establish TIF districts by contract with specific local businesses and industries to provide jobs training programming for new employees of existing expanding businesses or employees of new businesses. The revenues from these job training TIF districts then retires the debt incurred from the issuance of jobs training certificates which finance the cost of jobs training programming over a maximum of ten years. Upon payment of all jobs training certificates, the district dissolves and the incremental value from the new or expanded business reverts to the general tax base. There is no current valuation for this second type of TIF district. Legislation From time to time, legislative proposals are pending in Congress and the Iowa General Assembly that would, if enacted, alter or amend one or more of the property tax matters described herein. It cannot be predicted whether or in what forms any of such proposals, either pending or that may be introduced, may be enacted, and there can be no assurance that such proposals will not apply to valuation, assessment or levy procedures for taxes levied by the City or have an adverse impact on the future tax collections of the City. Purchasers of the Bonds should consult their tax advisors regarding any pending or proposed federal or state tax legislation. The opinions expressed by Bond Counsel are based upon existing legislation as of the date of issuance and delivery of the Bonds and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any pending federal or state tax legislation. During the 2019 legislative session, the Iowa General Assembly enacted Senate File 634 (the "2019 Act"). This bill modifies the process for hearing and approval of the total maximum property tax dollars under certain levies in the county budget. The bill also includes a provision that will require the affirmative vote of 2/3 of the City Council when the maximum property tax dollars under these levies exceed an amount determined under a prescribed formula. The 2019 Act does not change the process for hearing and approval of the Debt Service Levy pledged for repayment of the Bonds. It is too early to evaluate the affect the 2019 Act will have on the overall financial position of the City or its ability to fund essential services. During the 2013 legislative session, the Iowa General Assembly enacted Senate File 295 (the "2013 Act"). Among other things, the Act (i) reduced the maximum annual taxable value growth percent, due to revaluation of existing residential and agricultural property to 3%, (ii) assigned a "rollback" (the percentage of a property's value that is subject to tax) to commercial, industrial and railroad property of 90%, (iii) created a new property tax classification for multi -residential properties (apartments, nursing homes, assisted living facilities and certain other rental property) and assigned a declining rollback percentage to such properties for each year until the residential rollback percentage is reached in the 2022 assessment year, after which the rollback percentage for such properties will be equal to the residential rollback percentage each assessment year, and (iv) exempted a specified portion of the assessed value of telecommunication properties. 22 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 During the 2021 Iowa Legislative session, the Iowa General Assembly enacted House File 418, applicable to valuations beginning January 1, 2022 (the "2021 Act"). HF418 removes the multi -residential property classification by reclassifying certain properties as subdivision of "residential" property. The multi -residential classification was created as part of the January 1, 2015 valuations, and became unnecessary due to the equalization of the residential and multi - residential classifications as of January 1, 2022. The 2013 Act included a standing appropriation to replace some of the tax revenues lost by local governments due to the rollback. Iowa Code section 441.21A established this standing appropriation for reimbursement to local governments (backfill). However, SF 619, passed by the legislature on May 19, 2021 and subsequently signed into law by Governor Reynolds, phases out backfill payments beginning with fiscal years beginning on or after July 1, 2022. For cities and counties, the backfill is eliminated through annual reductions over five or eight years, depending on assessed valuation growth from 2012 to 2019. School district backfill payments will be eliminated after fiscal year 2022. Taxing authorities that are not schools, cities, or counties will have their backfill payments phased out over eight years. SF 619 also implements a tax credit for property owned by persons who are at least 70 years of age and whose annual household income is not more than 250% of the federal poverty level guidelines published by the U.S. Department of Health and Human Services. The expanded credit is available for claims filed on or after January 1, 2022. The expanded credit is exempt from the provisions of Iowa Code section 25B.7(1), which imposes a State requirement to fully fund changes to property tax credits. The legislation is anticipated to result in reduced property tax revenues as a result of the phased out property tax replacement claims and also due to expansion of the Elderly Property Tax Credit. Notwithstanding any decrease in property tax revenues that may result from the 2013 Act or the 2021 Act, the Bonds are secured by an unlimited ad valorem property tax as described more fully in the "SECURITY AND SOURCE OF PAYMENT" herein. From time to time, other legislative proposals may be considered by the Iowa General Assembly that would, if enacted, alter or amend one or more of the property tax matters described in this Official Statement. It cannot be predicted whether or in what forms any of such proposals may be enacted, and there can be no assurance that such proposals will not apply to valuation, assessment or levy procedures for the levy of taxes by the City. FINANCIAL INFORMATION Financial Reports The City's financial statements are audited annually by certified public accountants. The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. The accounting policies of the City conform to accounting principles generally accepted in the United States of America as applicable to governments. See APPENDIX A for more detail. No Consent or Updated Information Requested of the Auditor The tables and excerpts (collectively, the "Excerpted Financial Information") contained in this "FINANCIAL INFORMATION" section are from the audited financial statements of the City, including the audited financial statements for the fiscal year ended June 30, 2021 (the "2021 ACFR"). The 2021 ACFR has been audited by Bohnsack & Frommelt LLP, Certified Public Accountants, Moline, Illinois, (the "Auditor"), and received by the City Council. The City has not requested the Auditor to update information contained in the Excerpted Financial Information and the 2021 ACFR; nor has the City requested that the Auditor consent to the use of the Excerpted Financial Information and the 2021 ACFR in this Final Official Statement. The inclusion of the Excerpted Financial Information and the 2021 ACFR in this Final Official Statement in and of itself is not intended to demonstrate the fiscal condition of the City since the date of the 2021 ACFR. Questions or inquiries relating to financial information of the City since the date of the 2021 ACFR should be directed to the City. 23 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Summary Financial Information The following tables are summaries and do not purport to be the complete ACFRs, copies of which are available upon request. See APPENDIX A for the City's 2021 ACFR. The City's expects its General Fund balance for the fiscal year ending June 30, 2022 to decrease by approximately $2,400,000. The City has approved a budget for fiscal year 2023 with an anticipated decrease to the General Fund balance of approximately $850,000. STATEMENT OF NET POSITION GOVERNMENTAL ACTIVITIES(1) (Amounts Expressed in Thousands) Audited as of June 30 2017 2018 2019 2020 2021 Assets: Equity in Pooled Cash and Investments $111,030 $109,860 $111,645 $113,883 $130,934 Receivables: Property Tax 56,639 59,538 60,529 66,479 67,644 Accounts and Unbilled Usage 820 817 941 707 1,002 Interest 428 920 967 547 76 Notes 5,524 5,304 5,209 5,300 5,141 Internal Balances (15,494) (16,069) (20,055) (22,551) (24,229) Due from Other Governments 4,519 4,067 7,584 7,125 5,651 Prepaids and Other Assets 811 810 907 13 0 Inventories 730 602 650 793 786 Assets Held for Resale 750 562 689 480 400 Restricted Assets: Equity in Pooled Cash and Investments 24,560 26,108 18,553 19,743 25,056 Other Post Employment Benefits Asset 35 0 0 0 0 Capital Assets: Land and Construction in Progress 52,545 73,176 51,291 41,160 38,054 Other Capital Assets (Net of Accumulated Depreciation) 173 598 174 835 210 302 232 717 240 561 Total Assets $416 495 $440,530 $449,212 $466,396 $491,076 Deferred Outflows of Resources: Pension Related Deferred Outflows $ 13,131 $ 11,477 $ 11,255 $ 10,119 $ 12,833 OPEB Related Deferred Outflows 0 637 1.467 1,302 1,628 Total Deferred Outflows of Resources $ 13,131 $ 12,114 $ 12,722 $ 11,421 $ 14,461 Liabilities: Accounts Payable $ 2,127 $ 5,168 $ 3,399 $ 3,494 $ 2,913 Contracts Payable 2,521 3,663 5,864 3,725 2,840 Accrued Liabilities 4,182 4,193 5,231 5,558 5,958 Interest Payable 133 134 151 158 163 Deposits 1,230 952 1,008 1,222 1,124 Advances from Grantors 144 124 98 3 9,470 Due to Other Governments 42 29 31 38 45 Notes Payable 663 475 602 0 0 Noncurrent Liabilities: Due Within One Year: Employee Vested Benefits 1,252 1,253 1,308 1,525 1,546 Bonds Payable 8,230 9,612 11,534 11,119 11,536 Due in More Than One Year: Employee Vested Benefits 989 987 1,012 1,206 1,204 Net Pension Liability 39,080 38,867 38,890 39,796 47,299 Other Post Employment Benefits Liability 3,660 5,472 6,401 6,253 7,030 Notes Payable 211 211 211 211 211 Bonds Payable 59 509 58 307 56 771 58 653 57 931 Total Liabilities $123,973 $129,447 $132,511 $132,961 $149,270 Deferred Inflows of Resources: Pension Related Deferred Inflows $ 1,603 $ 1,565 $ 1,940 $ 3,045 $ 1,253 OPEB Related Deferred Inflows 0 246 216 560 492 Succeeding Year Property Taxes 56,459 59,173 60.296 65,850 66 912 Total Deferred Inflows of Resources $ 58,062 $ 60,984 $ 62,452 $ 69,455 $ 68 657 (continued on following page) 24 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 STATEMENT OF NET POSITION GOVERNMENTAL ACTIVITIES(1) (Amounts Expressed in Thousands) (continued) Net Position: Net Investment in Capital Assets Restricted for or by: Employee Benefits Capital Projects: Expendable(2) Nonexpendable(2) Debt Service Police Other Purposes Expendable Nonexpendable Grant Agreement Unrestricted Total Net Position Audited as of June 30 2017 2018 2019 2020 2021 $183,651 $203,077 2,810 3,119 30,856 21,463 0 0 7,221 8,423 349 283 2,590 4,469 0 0 3,850 3,733 16 264 17 646 $247 591 $262.213 $208,028 $220,004 $228,418 4,249 17,020 0 9,514 214 4,359 0 3,463 20 124 $266.971 3,875 3,973 11,464 12,266 278 218 9,590 7,388 294 271 4,552 6,300 69 69 3,456 3,179 21 819 25 528 $275 401 $287 610 Notes: (1) Source: Audited financial statements of the City for the fiscal years ended June 30, 2017 through 2021. (2) For fiscal years 2017 - 2019 amount is classified as expendable. STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES(1) (Amounts Expressed in Thousands) Function/Programs: Governmental Activities: Public Safety Public Works Culture and Recreation Community and Economic Development General Government Interest on Long -Term Debt Total Governmental Activities General Revenues: Property Taxes, Levied for General Purposes Hotel/Motel Tax Gas and Electric Tax Utility Franchise Tax Grants and Contributions Not Restricted to Specific Purposes Earnings on Investments Gain on Disposal of Capital Assets Miscellaneous Transfers Total General Revenues and Transfers Changes in Net Position Net Position Beginning of Year Net Position End of Year Audited for the Year Ended June 30 2017 2018 2019 2020 $ (18,053) 6,746 (14,573) (6,264) (4,600) (1,481) $ (38,225) $ 57,649 1,137 726 939 1,583 1,397 2,151 3,369 (7,053) $ 61,898 $ 23,673 223 918 $247 591 $ (20,466) (3,084) (15,189) (10,166) (5,338) (1,414) $ (55,657) $ 59,046 1,046 684 976 1,547 2,368 140 3,656 1,814 $ 71,277 $ 15,620 246 593(2) $ (20,862) (2,516) (14,834) (14,116) (5,807) (1,444) $ (59,579) $ 61,739 1,302 668 965 1,552 3,257 186 3,329 (8,661) $ 64,337 $ 4,758 262 213 $262.213 $266.971 2021 $ (22,728) $ (25,853) (4,737) (2,958) (15,451) (15,442) (7,760) (4,792) (6,137) (8,757) (1,452) (1,561) $ (58,265) $ (59,363) $ 62,846 $ 69,482 1,135 938 677 644 884 994 1,513 1,587 2,585 841 111 213 3,331 3,030 (6,387) (6,157) $ 66,695 $ 71,572 $ 8,430 $ 12,209 266 971 275 401 $275 401 $287 610 Notes: (1) Source: Audited financial statements of the City for the fiscal years ended June 30, 2017 through 2021. (2) Restated. 25 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 BALANCE SHEET GENERAL FUND(1) (Amounts Expressed in Thousands) Audited as of June 30 2017 2018 2019 2020 2021 Assets: Equity in Pooled Cash and Investments $32,500 $36,321 $38,979 $42,371 $51,870 Receivables: Property Taxes 32,965 34,973 36,301 40,081 40,959 Accounts and Unbilled Usage 410 496 491 355 508 Interest 161 276 360 163 24 Notes 1,292 1,276 1,329 1,252 1,073 Due from Other Funds 0 0 0 299 174 Advances to Other Funds 0 0 56 0 0 Due from Other Governments 1,887 1,941 2,131 3,661 2,080 Prepaid Item 719 726 818 13 0 Assets Held for Resale 750 562 689 480 400 Restricted Assets: Equity in Pooled Cash and Investments 10 268 1 904 2 028 2 209 2 134 Total Assets $80 952 $78 475 $83.182 $90.884 $99.222 Liabilities, Deferred Inflows of Resources and Fund Balances: Liabilities: Accounts Payable $ 1,191 $ 1,492 $ 1,497 $ 1,356 $ 1,672 Accrued Liabilities 1,321 1,391 1,466 1,673 1,957 Due to Other Governments 38 29 31 38 38 Interest Payable 4 5 17 0 0 Notes Payable 663 475 602 0 0 Liabilities Payable from Restricted Assets: Deposits 1,224 947 1,004 1,217 1,115 Advances from Grantors 7 113 94 0 19 Total Liabilities $ 4,448 $ 4,452 $ 4,711 $ 4,284 $ 4,801 Deferred Inflows of Resources: Unavailable Revenues: Succeeding Year Property Taxes $32,863 $34,764 $36,176 $39,720 $40,568 Grants 6 9 34 1,791 4 Other 1, 539 1,600 1,643 1, 716 1, 628 Total Deferred Inflows of Resources $34,408 $36,373 $37,853 $43,227 $42,200 Fund Balances: Nonspendable $ 788 $ 793 $ 887 $ 549 $ 469 Restricted 9,974 1,942 1,808 1,747 1,455 Committed 5,199 4,962 0 0 0 Assigned 1,342 1,437 3,565 5,708 9,883 Unassigned 24,793 28,516 34,358 35,369 40,414 Total Fund Balances $42,096 $37,650 $40,618 $43,373 $52,221 Total Liabilities, Deferred Inflows of Resources and Fund Balances $80 952 $78 475 $83.182 $90.884 $99.222 Note: (1) Source: Audited financial statements of the City for the fiscal years ended June 30, 2017 through 2021. The remainder of this page was left blank intentionally. 26 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GENERAL FUND(1) (Amounts Expressed in Thousands) Audited Fiscal Year Ended June 30 2017 2018 2019 2020 2021 Revenues: Taxes $ 34,290 $ 35,363 $37,426 $38,087 $42,635 Licenses and Permits 3,521 2,734 2,981 2,352 2,541 Intergovernmental 3,574 3,786 4,099 4,009 5,924 Charges for Service 1,665 1,465 1,595 1,113 808 Fines and Forfeits 750 695 776 609 375 Use of Money and Property 839 1,164 1,599 1,102 456 Miscellaneous 1,692 1,878 1,950 2,031 1,688 Total Revenues $ 46,331 $ 47,085 $50,426 $49,303 $54,427 Expenditures: Current: Public Safety $ 22,005 $ 22,762 $23,858 $24,611 $24,764 Public Works 1,803 1,871 1,922 2,219 2,076 Cultural and Recreation 12,890 13,099 13,096 13,146 12,407 Community and Economic Development 3,074 2,785 3,561 3,678 3,487 General Government 5,471 5,550 6,144 6,336 6,676 Capital Outlay 1,463 2,124 1,718 2,088 1,828 Total Expenditures $ 46,706 $ 48,191 $50,299 $52,078 $51,238 Excess (Deficiency) of Revenues Over (Under) Expenditures ... $ (375) $ (1,106) $ 127 $ (2,775) $ 3,189 Other Financing Sources (Uses): Issuance of Debt $ 0 $ 17 $ 0 $ 0 $ 0 Sale of Capital Assets 268 140 758 111 233 Transfers In 10,725 10,138 11,548 12,578 12,567 Transfers Out (18,023) (13,635) (9,465) (7,159) (7,141) Total Other Financing Sources and (Uses) $ (7,030) $ (3,340) $ 2,841 $ 5,530 $ 5,659 Net Change in Fund Balances $ (7,405) $ (4,446) $ 2,968 $ 2,755 $ 8,848 Fund Balances, Beginning $ 49,501(2) $ 42,096 $37,650 $40,618 $43,373 Fund Balances, Ending $ 42,096 $ 37,650 $40 618 $43 373 $52,221 Notes: (1) Source: Audited financial statements of the City for the fiscal years ended June 30, 2017 through 2021. (2) Restated. REGISTRATION, TRANSFER AND EXCHANGE See also APPENDIX B - BOOK -ENTRY SYSTEM for information on registration, transfer and exchange of book -entry bonds. The Bonds will be initially issued as book -entry bonds. The City shall cause books (the "Bond Register") for the registration and for the transfer of the Bonds to be kept at the principal office maintained for the purpose by the Bond Registrar in St. Paul, Minnesota. The City will authorize to be prepared, and the Bond Registrar shall keep custody of, multiple bond blanks executed by the City for use in the transfer and exchange of Bonds. Any Bond may be transferred or exchanged, but only in the manner, subject to the limitations, and upon payment of the charges as set forth in the Bond Resolution. Upon surrender for transfer or exchange of any Bond at the principal office maintained for the purpose by the Bond Registrar, duly endorsed by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the Bond Registrar and duly executed by the registered owner or such owner's attorney duly authorized in writing, the City shall execute and the Bond Registrar shall authenticate, date and deliver in the name of the registered owner, transferee or transferees (as the case may be) a new fully registered Bond or Bonds of the same maturity and interest rate of authorized denominations, for a like aggregate principal amount. The execution by the City of any fully registered Bond shall constitute full and due authorization of such Bond, and the Bond Registrar shall thereby be authorized to authenticate, date and deliver such Bond, provided, however, the principal amount of outstanding Bonds of each maturity authenticated by the Bond Registrar shall not exceed the authorized principal amount of Bonds for such maturity less Bonds previously paid. 27 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 The Bond Registrar shall not be required to transfer or exchange any Bond following the close of business on the fifteenth day of the month next preceding an interest payment date on such bond (known as the record date), nor to transfer or exchange any Bond after notice calling such Bond for redemption has been mailed, nor during a period of fifteen days next preceding mailing of a notice of redemption of any Bonds. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of the principal of or interest on any Bonds shall be made only to or upon the order of the registered owner thereof or such owner's legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. No service charge shall be made for any transfer or exchange of Bonds, but the City or the Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any transfer or exchange of Bonds except in the case of the issuance of a Bond or Bonds for the unredeemed portion of a bond surrendered for redemption. TAX MATTERS Tax Exemption Federal tax law contains a number of requirements and restrictions that apply to the Bonds, including investment restrictions, periodic payments of arbitrage profits to the United States, requirements regarding the proper use of Bond proceeds and facilities financed with Bond proceeds, and certain other matters. The City has covenanted to comply with all requirements that must be satisfied in order for the interest on the Bonds to be excludable from gross income for federal income tax purposes. Failure to comply with certain of such covenants could cause interest on the Bonds to become includable in gross income for federal income tax purposes retroactively to the date of issuance of the Bonds. Subject to the City's compliance with the above -referenced covenants, under present law, in the opinion of Bond Counsel, the interest on the Bonds is excludable from gross income for federal income tax purposes and interest on the Bonds is not an item of tax preference for purposes of the federal alternative minimum tax. Prospective purchasers of the Bonds should be aware that ownership of the Bonds may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, corporations subject to the branch profits tax, financial institutions, certain insurance companies, certain S corporations, individual recipients of Social Security or Railroad Retirement benefits and taxpayers who may be deemed to have incurred (or continued) indebtedness to purchase or carry tax-exempt obligations Bond Counsel will not express any opinion as to such collateral tax consequences. Prospective purchasers of the Bonds should consult their tax advisors as to collateral federal income tax consequences. The interest on the Bonds is not exempt from present Iowa income taxes. Ownership of the Bonds may result in other state and local tax consequences to certain taxpayers. Bond Counsel expresses no opinion regarding any such collateral consequences arising with respect to the Bonds. Prospective purchasers of the Bonds should consult their tax advisors regarding the applicability of any such state and local taxes. NOT Qualified Tax Exemption Obligations The City will NOT designate the Bonds as "qualified tax-exempt obligations". 28 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Discount and Premium Bonds The initial public offering price of certain Bonds may be less than the amount payable on such Bonds at maturity ("Discount Bonds"). Purchasers of Discount Bonds should consult with their own tax advisors with respect to the determination of accrued original issue discount on Discount Bonds for federal income tax purposes and with respect to the state and local tax consequences of owning and disposing of Discount Bonds. It is possible that, under applicable provisions governing determination of state and local income taxes, accrued interest on Discount Bonds may be deemed to be received in the year of accrual even though there will not be a corresponding cash payment. The initial public offering price of certain Bonds may be greater than the amount of such Bonds at maturity ("Premium Bonds"). Purchasers of the Premium Bonds should consult with their own tax advisors with respect to the determination of amortizable premium on Premium Bonds for federal income tax purposes and with respect to the state and local tax consequences of owning and disposing of Premium Bonds. Other Tax Advice In addition to the income tax consequences described above, potential investors should consider the additional tax consequences of the acquisition, ownership, and disposition of the Bonds. For instance, state income tax law may differ substantially from state to state, and the foregoing is not intended to describe any aspect of the income tax laws of any state. Therefore, potential investors should consult their own tax advisors with respect to federal tax issues and with respect to the various state tax consequences of an investment in Bonds. Audits The Internal Revenue Service (the "Service") has an ongoing program of auditing tax-exempt obligations to determine whether, in the view of the Service, interest on such tax-exempt obligations is includable in the gross income of the owners thereof for federal income tax purposes. To the best of the City's knowledge, no obligations of the City are currently under examination by the Service. It cannot be predicted whether or not the Service will commence an audit of the Bonds. If an audit is commenced, under current procedures the Service may treat the City as a taxpayer and the Bondholders may have no right to participate in such procedure. The commencement of an audit could adversely affect the market value and liquidity of the Bonds until the audit is concluded, regardless of the ultimate outcome. Reporting and Withholding Payments of interest on, and proceeds of the sale, redemption or maturity of, tax-exempt obligations, including the Bonds, are in certain cases required to be reported to the Service. Additionally, backup withholding may apply to any such payments to any Bond owner who fails to provide an accurate Form W-9 Request for Taxpayer Identification Number and Certification, or a substantially identical form, or to any Bond owner who is notified by the Service of a failure to report any interest or dividends required to be shown on federal income tax returns. The reporting and backup withholding requirements do not affect the excludability of such interest from gross income for federal tax purposes. Tax Legislation Legislation affecting tax-exempt obligations is regularly considered by the United States Congress and may be considered by the Iowa General Assembly. Court proceedings may also be filed, the outcome of which could modify the tax treatment. There can be no assurance that legislation enacted or proposed, or actions by a court, after the date of issuance of the Bonds will not have an adverse effect on the tax status of interest or other income on the Bonds or the market value or marketability of the Bonds. These adverse effects could result, for example, from changes to federal or state income tax rates, changes in the structure of federal or state income taxes (including replacement with another type of tax), or repeal (or reduction in the benefit) of the exclusion of interest on the Bonds from gross income for federal or state income tax purposes for all or certain taxpayers. 29 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of issuance and delivery of the bonds, and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any proposed or pending legislation, regulatory initiatives or litigation. Enforcement There is no trustee or similar person to monitor or enforce the terms of the Bond Resolution. In the event of a default in the payment of principal of or interest on the Bonds, there is no provision for acceleration of maturity of the principal of the Bonds. Consequently, the remedies of the owners of the Bonds (consisting primarily of an action in the nature of mandamus requiring the City and certain other public officials to perform the terms of the Bond Resolution) may have to be enforced from year to year. The owners of the Bonds cannot foreclose on property within the boundaries of the City or sell such property in order to pay the debt service on the Bonds. In addition, the enforceability of the rights and remedies of owners of the Bonds may be subject to limitation as set forth in Bond Counsel's opinion. The opinion will state, in part, that the obligations of the City with respect to the Bonds may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted to the extent constitutionally applicable, to the exercise of judicial discretion in appropriate cases and to the exercise by the State and its governmental bodies of the police power inherent in the sovereignty of the State and to the exercise by the United States of America of the powers delegated to it by the Constitution of the United States of America. The Opinion The FORM OF LEGAL OPINION, in substantially the form set out in APPENDIX C to this Preliminary Official Statement, will be delivered at closing. Bond Counsel's opinion is not a guarantee of a result, or of the transaction on which the opinion is rendered, or of the future performance of parties to the transaction, but represents its legal judgment based upon its review of existing statutes, regulations, published rulings and court decisions and the representations and covenants of the City described in this section. No ruling has been sought from the Service with respect to the matters addressed in the opinion of Bond Counsel and Bond Counsel's opinion is not binding on the Service, nor does the rendering of the opinion guarantee the outcome of any legal dispute that may arise out of the transaction. Bond Counsel assumes no obligation to update its opinion after the issue date to reflect any further action, fact or circumstance, or change in law or interpretation, or otherwise. Bond Counsel Review Bond Counsel has approved the language included in this "TAX MATTERS" Section but has not otherwise participated in the preparation of this Preliminary Official Statement and will not pass upon its accuracy, completeness or sufficiency. Bond Counsel has not examined, nor attempted to examine or verify, any of the financial or statistical statements or data contained in this Preliminary Official Statement, and will express no opinion with respect thereto. ALL POTENTIAL PURCHASERS OF THE BONDS SHOULD CONSULT WITH THEIR TAX ADVISORS WITH RESPECT TO FEDERAL, STATE AND LOCAL TAX CONSEQUENCES OF OWNERSHIP OF THE BONDS (INCLUDING BUT NOT LIMITED TO THOSE LISTED ABOVE). 30 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 CONTINUING DISCLOSURE For the purpose of complying with Rule 15c2-12 of the Securities and Exchange Commission, as amended and interpreted from time to time (the "Rule"), the City will covenant and agree, for the benefit of the registered holders or beneficial owners from time to time of the outstanding Bonds to provide reports of specified information and notice of the occurrence of certain events, as hereinafter described (the "Disclosure Covenants"). The information to be provided on an annual basis, and the events as to which notice is to be given, is set forth in "APPENDIX D — Form of Continuing Disclosure Certificate". This covenant is being made by the City to assist the Underwriter(s) in complying with the Rule. Breach of the Disclosure Covenants will not constitute a default or an "Event of Default" under the Bonds or Resolution, respectively. A broker or dealer is to consider a known breach of the Disclosure Covenants, however, before recommending the purchase or sale of the Bonds in the secondary market. Thus, a failure on the part of the City to observe the Disclosure Covenants may adversely affect the transferability and liquidity of the Bonds and their market price. Pursuant to the Rule, in the last five years, the City, to the best of its knowledge, failed to timely file a material event notice for a financial obligation entered into on August 1, 2019. The City has taken steps to ensure future filing of this information in compliance with the applicable undertakings. Bond Counsel expresses no opinion as to whether the Disclosure Covenants comply with the requirements of Section (b)(5) of the Rule. OPTIONAL REDEMPTION Bonds due June 1, 2023 - 2028 inclusive, are not subject to optional redemption. Bonds due June 1, 2029 - 2032, inclusive, are callable in whole or in part on any date on or after June 1, 2028, at a price of par and accrued interest. If selection by lot within a maturity is required, the Registrar shall designate the Bonds to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Bonds to be called has been reached. If less than all of the maturity is called for redemption, the City will notify DTC of the particular amount of such maturity to be redeemed prior to maturity. DTC will determine by lot the amount of each Participant's interest in such maturity to be redeemed and each Participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Thirty days' written notice of redemption shall be given to the registered owner of the Bond. Failure to give written notice to any registered owner of the Bonds or any defect therein shall not affect the validity of any proceedings for the redemption of the Bonds. All Bonds or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. Written notice will be deemed completed upon transmission to the owner of record. LITIGATION There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or affecting the validity of the Bonds or any proceedings of the City taken with respect to the issuance or sale thereof. There is no litigation now pending, or to the knowledge of the City, threatened against the City that is expected to materially impact the financial condition of the City. 31 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 LEGAL MATTERS The Bonds are subject to approval as to certain legal matters by Ahlers & Cooney, P.C., Des Moines, Iowa, as Bond Counsel. Bond Counsel has not participated in the preparation of this Official Statement except for guidance concerning the sections regarding "TAX MATTERS", and will not pass upon its accuracy, completeness, or sufficiency. Bond Counsel has not examined nor attempted to examine or verify any of the financial or statistical statements, or data contained in this Official Statement, and will express no opinion with respect thereto. A legal opinion in substantially the form set forth in APPENDIX C to this Official Statement will be delivered at closing. Ahlers & Cooney, P.C. is also serving as Disclosure Counsel for the City in connection with the issuance of the Bonds. The legal opinion to be delivered concurrently with the delivery of the Bonds expresses the professional judgment of the attorneys rendering the opinion as to legal issues expressly addressed therein. By rendering a legal opinion, the opinion giver does not become an insurer or guarantor of the result indicated by that expression of professional judgment, or of the transaction on which the opinion is rendered, or of the future performance of parties to the transaction. Nor does the rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction. In addition, the enforceability of the rights and remedies of owners of the Bonds may be subject to limitation as set forth in the Bond Counsel's opinion. The opinion will state, in part, that the obligation of the City with respect to the Bonds may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted to the extent constitutionally applicable, and to the exercise of judicial discretion in appropriate cases. OFFICIAL STATEMENT AUTHORIZATION This Official Statement has been authorized for distribution to prospective purchasers of the Bonds. All statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the City, and all expressions of opinion, whether or not so stated, are intended only as such. This Official Statement is not to be construed as a contract or agreement amongst the City, the Underwriter, or the holders of any of the Bonds. Any statements made in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended merely as opinions and not as representations of fact. The information and expressions of opinions contained herein are subject to change without notice and neither the delivery of this Official Statement or the sale of the Bonds made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City since the date hereof. The information contained in this Official Statement is not guaranteed. INVESTMENT RATING The City has supplied certain information and material concerning the Bonds and the City to the rating service shown on the cover page, including certain information and materials which may not have been included in this Official Statement, as part of its application for an investment rating on the Bonds. A rating reflects only the views of the rating agency assigning such rating and an explanation of the significance of such rating may be obtained from such rating agency. Generally, such rating service bases its rating on such information and material, and also on such investigations, studies and assumptions that it may undertake independently. There is no assurance that such rating will continue for any given period of time or that it may not be lowered or withdrawn entirely by such rating service if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of such rating may have an adverse effect on the secondary market price of the Bonds. An explanation of the significance of the investment rating may be obtained from the rating agency: Moody's Investors Service, 7 World Trade Center at 250 Greenwich Street, New York, New York 10007, telephone 212- 553-1658. 32 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 UNDERWRITING The Bonds were offered for sale by the City at a public, competitive sale on Tuesday, May 3, 2022. The best bid submitted at the sale was submitted by (the "Underwriter"). The City awarded the contract for sale of the Bonds to the Underwriter at a price of $ (reflecting the par amount of $ , plus a reoffering premium of $ , and less an Underwriter's discount of $ ). The Underwriter has represented to the City that the Bonds have been subsequently re -offered to the public initially at the yields or prices set forth in the Final Official Statement. MUNICIPAL ADVISOR The City has engaged Speer Financial, Inc. as municipal advisor (the "Municipal Advisor") in connection with the issuance and sale of the Bonds. The Municipal Advisor is a Registered Municipal Advisor in accordance with the rules of the MSRB. The Municipal Advisor will not participate in the underwriting of the Bonds. The financial information included in the Official Statement has been compiled by the Municipal Advisor. Such information does not purport to be a review, audit or certified forecast of future events and may not conform with accounting principles applicable to compilations of financial information. The Municipal Advisor is not a firm of certified public accountants and does not serve in that capacity or provide accounting services in connection with the Bonds. The Municipal Advisor is not obligated to undertake any independent verification of or to assume any responsibility for the accuracy, completeness or fairness of the information contained in this Official Statement, nor is the Municipal Advisor obligated by the City' s continuing disclosure undertaking. MISCELLANEOUS Brief descriptions or summaries of the City, the Bonds, the Resolution and other documents, agreements and statutes are included in this Official Statement. The summaries or references herein to the Bonds, the Resolution and other documents, agreements and statutes referred to herein, and the description of the Bonds included herein, do not purport to be comprehensive or definitive, and such summaries, references and descriptions are qualified in their entireties by reference to such documents, and the description herein of the Bonds is qualified in its entirety by reference to the form thereof and the information with respect thereto included in the aforesaid documents. Copies of such documents may be obtained from the City. Any statements in this Official Statement involving matters of opinion or estimates, whether or not expressly so stated, are intended as such and not as representations of fact, and no representation is made that any of the estimates will be realized. This Official Statement is not to be construed as a contract or agreement between the City and the purchasers or Owners of any of the Bonds. The attached APPENDICES A, B, C, and D are integral parts of this Official Statement and must be read together with all of the foregoing statements. It is anticipated that CUSIP identification numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bonds nor any error in the printing of such numbers shall constitute cause for a failure or refusal by the purchaser thereof to accept delivery of and pay for any Bonds. The City has reviewed the information contained herein which relates to it and has approved all such information for use within this Official Statement. The execution and delivery of this Official Statement has been duly authorized by the City. /s/ NICOLE DAVIES Finance Director CITY OF IOWA CITY Johnson County, Iowa 33 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 APPENDIX A CITY OF IOWA CITY JOHNSON COUNTY, IOWA FISCAL YEAR 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT C°ty of wa C°t Annual Comprehensive Financial Rep'. For the Fiscal Year Ended June 30, 2021 Annual Comprehensive Financial Report City of Iowa City, Iowa For the fiscal year ended June 30, 2021 Prepared by: Finance Department City of Iowa City, Iowa Introductory Section Tab City of Iowa City, Iowa Table of Contents June 30, 2021 Introductory Section Page Table of contents 1 Letter of transmittal 3 Certificate of Achievement for Excellence in Financial Reporting 12 City organizational chart 13 City officials 14 Financial Section Independent Auditor's Report 15 Management's Discussion and Analysis 19 Basic Financial Statements Government -wide financial statements Statement of net position 30 Statement of activities 33 Fund financial statements Balance sheet — governmental funds 34 Reconciliation of the balance sheet of the governmental funds to the statement of net position 35 Statement of revenues, expenditures, and changes in fund balances — governmental funds 36 Reconciliation of the statement of revenues, expenditures, and changes in fund balances of governmental funds to the statement of activities 37 Statement of net position — proprietary funds 38 Statement of revenues, expenses, and changes in fund net position — proprietary funds 39 Statement of cash flows — proprietary funds 40 Statement of fiduciary net position — custodial fund 41 Statement of changes in fiduciary net position — custodial fund 42 Notes to financial statements 43 Required Supplementary Information Budgetary comparison schedule — budget and actual — all governmental funds and enterprise funds — budgetary basis 78 Budgetary comparison schedule — budget to GAAP reconciliation 80 Note to required supplementary information — budgetary reporting 81 Schedule of the City's proportionate share of MFPRSI net pension liability 83 Schedule of City's MFPRSI contributions 84 Notes to required supplementary information — MFPRSI pension liability 86 Schedule of the City's proportionate share of IPERS net pension liability 87 Schedule of City's IPERS contributions ... 88 Notes to required supplementary information — IPERS pension liability 90 Required supplementary information — schedule of changes in the City's total OPEB liability, related ratios and notes 91 Combining Fund Statements Combining balance sheet — nonmaj or governmental funds 94 Combining statement of revenues, expenditures, and changes in fund balances — nonmajor governmental funds 95 Combining statement of net position — nonmajor enterprise funds 98 Combining statement of revenues, expenses, and changes in fund net position — nonmajor enterprise funds 99 Combining statement of cash flows — nonmajor enterprise funds 100 Combining statement of net position — internal service funds 102 1 City of Iowa City, Iowa Table of Contents June 30, 2021 Page Combining Fund Statements (continued) Combining statement of revenues, expenses, and changes in fund net position — internal service fund 103 Combining statement of cash flows — internal service funds 104 Statistical Section (Unaudited) Net position by component 107 Changes in net position 108 Fund balances — governmental funds 110 Changes in fund balances — governmental funds 111 General government tax revenues by source 112 Assessed and taxable value of property 113 Property tax rates — direct and overlapping governments 114 Levies and collections 115 Principal taxpayers 116 Larger water system customers 118 Sales history and water system charges 119 Larger sewer system customers 120 Sales history and sewer system charges 121 Ratios of outstanding debt by type 122 Ratios of general obligation bonded debt to assessed value and net bonded debt per capita 123 Computation of direct and overlapping debt 124 Legal debt margin information 125 Schedule of revenue bond coverage 126 Schedule of TIF revenue bond coverage 127 Demographic and economic statistics 128 Principal employers 129 Full-time equivalent city government employees by function 130 Operating indicators by function 131 Capital assets by function 132 Compliance Section Independent auditor's report on internal control over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with Government Auditing Standards 133 Independent auditor's report on compliance for each major federal program and report on internal control over compliance required by the Uniform Guidance 135 Schedule of expenditures of federal awards 137 Notes to the schedule of expenditures of federal awards 140 Schedule of findings and questioned costs 141 Corrective action plan 144 2 December 3, 2021 To the Citizens, Honorable Mayor, Members of the City Council and City Manager City of Iowa City, Iowa 1 1 CITY OF IOWA CITY The Annual Comprehensive Financial Report (Annual Report) of the City of Iowa City, Iowa (the City) for the fiscal year ended June 30, 2021 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. Management assumes full responsibility for the completeness and reliability of all of the information presented in this report, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal controls should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements will be free of any material misstatement. Bohnsack & Frommelt, LLP, a firm of independent public accountants has issued an unmodified ("clean") opinion on the City's financial statements for the year ended June 30, 2021. Their opinion is included in the Financial Section of this report. The City is required to undergo an annual single audit in conformity with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Information to comply with the Uniform Guidance and "Government Auditing Standards" is included in the Compliance Section of this report. GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City's MD&A can be found immediately following the report of the independent auditors. Profile of the Government The City of Iowa City was incorporated April 6, 1853. The City is governed by a seven member Council; each member serves a four-year term. Elections are held every two years allowing for continuation in office of at least three members at each biennial election. The Council members are elected at large, with three members nominated from specific districts and the remaining four members nominated at large. The Council elects the Mayor from its own members for a two-year term. 3 The City Council is the legislative body and makes all policy determinations for the City through the enactment of ordinances and resolutions. It also adopts a budget to determine how the City will obtain and spend its funds. The Council appoints members of boards, commissions and committees. The City Manager is the chief administrative officer for the City and is appointed by the City Council. The City Manager implements policy decisions of the City Council and enforces City ordinances. In addition, the City Manager appoints and directly supervises the directors of the City's operating departments and supervises the administration of the City's personnel system. The City Manager supervises 498 full-time and 43 part-time permanent municipal employees and 276 temporary employees, including a police force of 74 sworn personnel and a fire department of 64 firefighters. The City Clerk is appointed by the City Council and reports to the Council. The City Clerk's Office administers the City government's documentation, City licenses and permits, and provides information from the Municipal Code and City Ordinances to the public and other City depailments. The City Clerk's Office is also responsible for distributing and maintaining accurate records of all City Council proceedings. The Clerk supervises 3 full-time employees and 1 temporary employee. The City Attorney is also appointed by the City Council and works at the direction of the City Council. The City Attorney supervises the City Attorney's Office, including 4 Assistant City Attorneys and 2 other full-time employees. In addition, the City Attorney acts as Chief Legal Counsel to the City Council, City Manager, the various City departments and staff, and most City commissions, committees and boards. The City provides a full range of services including police and fire protection, construction and maintenance of roads, streets and infrastructure, inspection and licensing functions, a municipal airport, library, recreational activities, and cultural events. The City owns and operates its water supply and distribution system and sewage collection and treatment system with secondary treatment also provided. Virtually the entire City has separate storm and sanitary sewer systems. The City operates a municipal off-street and on -street parking system in the downtown area. The City also operates a transit system. The annual budget serves as the foundation for the City's financial planning and control. All departments of the City are required to submit requests for appropriation to the City Manager in October. The City Manager uses these requests as the starting point for developing a proposed budget. The City Manager then presents this proposed budget to the Council for review in December. The Council is required to hold a public hearing on the proposed budget and to adopt a final budget no later than March 15. The appropriated budget is prepared by fund, function (e.g., Public Safety), and department (e.g., Police). The City adopts a three-year financial plan that includes both operations and capital improvements. This three-year plan permits a more comprehensive review of the City's financial condition, allowing analysis of the current and 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. Appropriations that are not spent lapse at the end of the year. 4 Information Useful in Assessing the Government's Economic Condition The City's economic strength is based on the educational sector, medical services, and diversified manufacturing. The University of Iowa and the University of Iowa Hospital and Clinics are the City's largest employers with over 30,000 employees. The University of Iowa had an enrollment in fall 2021 of 31,206 students, which is a decrease of 524 students from 31,730 students in the fall of 2020. The academic and research missions of the University, along with the health care services provided at its hospitals and clinics, have an extremely positive economic impact on the area. The City also has a significant number of national and international businesses, including Fortune 500 companies: ACT Inc., NCS Pearson, and Procter & Gamble. In February 2018, Procter & Gamble announced that in approximately two years they would be shifting their beauty care products production from Iowa City to their West Virginia plant. The announced plan was to eventually reduce the workforce from approximately 600 down to 100 employees. This would also impact nearby businesses that produce bottles and labels for this production plant in Iowa City. In May 2020, Procter & Gamble announced that they were going to maintain more employees in Iowa City by maintaining its oral rinse production here and by shifting newer product lines here. In addition, Procter & Gamble has added and is expanding an electric toothbrush plant in Iowa City which is expected to employ several hundred employees; it currently has added approximately 100 employees. The estimated investment in this new facility has been nearly $100 million. Overall, the continued economic development efforts with the Iowa City and Coralville Chambers of Commerce, private interests, the University of Iowa, other surrounding communities, and the Iowa City Area Development Group, have produced positive results with the retention and expansion of businesses. In addition, Iowa's Creative Corridor is a seven -county alliance surrounding Iowa City and has been identified as one of the major growth areas for new business development in the State of Iowa. This Corridor gives employers workforce access to a region uniquely Iowan, founded with a manufacturing heritage, but actively seeking new frontiers and opportunities in information technology, biotechnology and bioprocessing, renewable energy, insurance and financial services, advanced manufacturing, and educational services. Continued developments within Iowa City and the region have a favorable impact upon the City's economy and growth. According to the 2020 census, the population of Iowa City is 74,828. This is an increase of 6,966 or 10.3% as compared to the 2010 census of 67,862. As a whole, the City's economy continues to grow, established firms continue to prosper and expand, and there are opportunities for growth for new businesses; however, the COVID-19 pandemic has had a substantial short-term impact on the City's economy. On March 13, 2020, the President of the United States declared a national emergency in response to the COVID-19 pandemic, and the State of Iowa declared a public health disaster emergency on March 17, 2020. Much of the City of Iowa City, the State of Iowa, and the United States shut down at that time. Due to the impact of the pandemic, the historically low unemployment rate for the City took a dramatic jump up and was at 6.9% for June 2020. This still compared favorably against the State of Iowa at 7.1% and the National rate of 11.1%. Comparably, in June 2019, Iowa City's unemployment rate was 2.2%, the State of Iowa's was 2.8%, and the National rate was 3.7%. Iowa City's economy has continued to improve and as of June 2021, Iowa City's unemployment rate had fallen to 4.4% while the State of Iowa was at 4.0%, and the National rate was 5.9%. The rate of new housing construction also decreased substantially due to the COVID-19 pandemic in comparison to the prior year based on the number of building permits issued. New housing building permits consisted of 101 new single-family houses and duplexes in 2020 as compared to 84 in 2019; multi -family dwelling units added during fiscal year 2020 was 49, compared to 417 in 5 84 in 2019; multi -family dwelling units added during fiscal year 2020 was 49, compared to 417 in 2019; and mixed commercial/residential developments added 0 dwelling units in 2020 versus 59 residential units in 2019. Altogether new housing additions totaled 150 units valued at $42,363,387 in 2020 versus a total of 560 units valued at $124,362,697 in 2019. Also reflecting the impact of the COVID-19 pandemic, the City had a decrease in commercial construction permits between 2019 and 2020. The value of permits for commercial and utility construction decreased from $9,755,586 in 2019 to $8,841,863 in 2020; also, the value of remodeling permits for residential and commercial properties decreased from $96,159,999 in 2019 to $34,150,596 in 2020. Total permits issued in 2020 for all purposes was 550 permits for $87,302,173 which was less than the 2019 total permit issuance of 606 permits for $231,521,881. The COVID-19 pandemic has had a significant short-term economic impact on the City of Iowa City; however, the City's unemployment rate has dropped steadily since its peak in April 2020 as the City's economy has started to open back up. The stability of the University of Iowa coupled with historically steady employment by the City's multi -sector base of manufacturing and service industries helps to insulate the City from significant negative impacts of economic recessions. The City's property valuations continue to rise which is indicative of the City's relative economic stability. The City is well positioned to recover from the negative economic effects of the COVID- 19 pandemic. Major Initiatives The City of Iowa City, with the assistance of Kirkwood Community College, completed the City's Strategic Plan. The strategic planning process involved multiple steps, including gathering input from the general public, front-line City staff, department directors, and the City Council. The Strategic Plan establishes the following organizational priorities, programs, policies, and initiatives: 1. Promote a Strong and Resilient Local Economy • Through collaboration with local partners, increase opportunities for marginalized and low-income populations to obtain access to skills training, good jobs and affordable childcare • Encourage healthy, diverse, and sustainable economic activity throughout Iowa City, including taking steps to invigorate neighborhood commercial districts and create new small neighborhood commercial nodes • Effectively support growth and promotion of small locally -owned businesses, women and minority-owned businesses, and the local foods economy 2. Enhance Community Mobility for All Residents • Continue implementation of the City's Bicycle Master Plan and pursue Gold Bicycle Friendly Community status from the League of American Bicyclists • Complete the Iowa City Area Transit Study, pursue recommended changes, and evaluate implementation outcomes, to ensure community needs are met by system changes • Ensure ease and safety of travel for residents and visitors through expansion of accessibility measures, improved connectivity, and use of adopted complete streets design standards 3. Foster Healthy Neighborhoods throughout the City • Identify new efforts to expand and adapt the City's affordable housing and neighborhood improvement strategies to meet long-term needs throughout the community 6 • Consider and adopt the South District form -based code and ensure it can be adapted to other parts of Iowa City • Continue implementation of the Parks Master Plan and complete an accompanying Recreational Facilities Master Plan • Monitor and report biannually on building and rental permit trends in the former rental cap neighborhoods • Support neighborhood activities and improvements that create vibrant, creative spaces and inspire a sense of place and community 4. Invest in Public Infrastructure, Facilities and Fiscal Reserves • Carefully prepare for significant financial challenges projected during the final years of State property tax reform mandates through fiscal year 2024 • Strive to continue to reduce the City's overall property tax rate • Evaluate Local Option Sales Tax and other alternative revenues that may be needed to achieve Iowa City's strategic objectives and reduce reliance on debt and property taxes • Develop a long-term plan to improve the pavement condition of City streets • Initiate physical and financial planning efforts to modernize and expand critical public facilities • Consider establishing a cost of development framework that can help guide decisions on how best to accommodate future growth 5. Strengthen Community Engagement and Intergovernmental Relations • Initiate a redesign of the City's website • Pursue creative engagement techniques with a focus on reaching diverse populations and neighborhoods • Work collaboratively with other local governments and strengthen ties with our state and federal elected delegation 6. Demonstrate Leadership in Climate Action • Adopt and begin implementation of the Accelerating Iowa City's Climate Actions Report • Track and effectively communicate progress toward reaching the Intergovernmental Panel on Climate Change's (IPCC) carbon emission reduction targets adopted locally by the City Council in 2019 7. Advance Social Justice, Racial Equity, and Human Rights • Ensure City progress towards increasing diversity of staff in a manner that is reflective of community demographics • Complete the phased effort to raise the minimum wage for temporary employees to $15.00 per hour by July 1, 2021 • Continue emphasis on human rights -based training for city employees, boards and commissions, and the community • Establish priorities and ensure resources for increased access and translation of critical city messages • Continue partnerships with community organizations through the City's Social Justice and Racial Equity grant program • Develop a coordinated effort across City departments to expand social and recreational programming for special populations 7 The City Council has also promoted private investment and re -development of other targeted areas throughout the community. The areas that are currently being focused on include the Riverfront Crossings area, the Downtown District, the Riverside Drive commercial area, and the Foster Road Urban Renewal Area. The Riverfront Crossing area is an initiative to revitalize the area south of Iowa City's downtown district. This area was hard hit by flooding in 2008 and ideas for improving the district were initiated as part of a combined flood mitigation plan. The district features a riverfront park with walking and biking trails, a variety of housing options near shopping, restaurants, a state-of-the-art recital hall and recreational facilities and is a short walk to downtown Iowa City and the University of Iowa campus. This area has seen significant development over the past few years. The Riverfront Crossings area is anchored by a 76.8 acre park that was formerly comprised of public facilities including the City's north wastewater treatment plant. An $8.5 million hazard mitigation grant from the State of Iowa assisted the City in removing the public facilities in this area and then converting the area into a riverfront park and wetland. Construction of phases 1 through 3 of the park began in 2017 and were completed during the fall of 2019; phase 4 of the park started in 2019 and was completed in the fall of 2020. On the north side of the Riverfront Crossing area, the University of Iowa recently constructed the Voxman School of Music. On the opposite side of the street, the redevelopment of an empty lot was completed in the spring of 2019 which includes a 7 -story, mixed-use building with 40 apartment units, retail space on the street level, and office space on the second floor. An adjacent building houses a 7 -story Element Hotel by Marriott. The estimated cost of these developments is approximately $40 million. On the back side of the School of Music, a new development has been approved for two new 15 story towers with up to 820 total units and 1,575 beds. This area is approximately one city block in size, will provide right-of-way to re -connect Capitol Street, and has an estimated investment of $200 million. In the Downtown District, the City completed a streetscape plan for the Central Business District which included lighting, landscaping, parking, utility improvements, artwork, and pedestrian amenities. Reconstruction and enhancements for the Washington Street corridor were completed in 2017 and reconstruction of Black Hawk mini -park and the downtown pedestrian mall were completed last year. Other future downtown streetscape projects are scheduled in the five-year capital improvement program. The downtown has also seen significant private development over the past few years. Private development in the downtown area includes a new project started in 2021 which includes the historical renovation of several commercial buildings along the pedestrian mall and the construction of an 11 -story, 120,000 square foot multi -residential with 102 residential units. The total project is estimated to cost $54.4 million. Other buildings in the downtown that have undergone major re -development recently include the Wilson Building and public space which has been developed into a 15 -story mixed-use development known as the Chauncey; this building has 8 floors of residential units, a 35 -unit hotel, two floors of commercial space, a movie theatre and a bowling alley. The project was estimated to cost $49 million. Also completed was the redevelopment of the City Hall parking lot and neighboring church into 126 residential units, parking, and commercial space. The project was estimated to cost $33.4 million. Both of these projects are mostly complete with the exception of some of the commercial spaces which are still being remodeled. Also new in 2020, was the addition of a 13,000+ square foot Target in a large downtown store front that had been vacant for years. This store represents a trend away from big box stores on the edges of town and a focus on University related downtown foot traffic. 8 The Riverside Drive commercial area is an area that stretches from the University of Iowa campus to the intersection of Highways 1 and 6 and is across the river from the Riverfront Crossings development area. The development of a 4 -story, $16.1 million multi-family/student housing development in the Riverside Drive area was completed in late 2016, and adjacent to this development several new retail spaces including a gas station/marketplace and additional multi - residential housing units were also constructed or renovated. The City is developing a streetscape plan for this area which will include lighting, trails, landscaping, and other amenities and improvements. Construction of the streetscape and intersection improvements began in 2018 and were completed in 2020. Additional streetscape and trail improvements are planned for this area in the future. Development of the Foster Road Urban Renewal Area is underway which will convert a 53.29 acre wooded area north of the Downtown area and near Interstate 80 into a new residential/multi- residential development with a total estimated cost of approximately $33 million. A 53 -unit, 55+ senior living facility was recently constructed, and an additional 52 townhomes are planned adjacent to the facility. The project also extended the Foster Road arterial from Dubuque Street to Prairie Du Chien Road, and the area will provide Low -Middle Income (LMI) funding through a tax increment district that can be used by the City anywhere to assist with the development of affordable housing. Long-term Financial Planning It is management's intent to support the major City Council initiatives through budget appropriations, departmental operations, and employee development so that the organization as a whole is moving in the same direction. A significant influence in the preparation of the three-year financial plan (FY2020 — FY2022) was the passage of property tax reform (SF295) by the state legislature in 2013. The property tax reform bill had multiple components including a property tax rollback for commercial and industrial property, which reduced the taxable value of these property types. The bill established a State funded "backfill" to reimburse the City for lost property tax revenues due to the commercial and industrial rollback. The State "backfill" payments began in fiscal year 2015 but were capped at the fiscal year 2017 levels for years thereafter. The cumulative reduction in commercial and industrial property tax revenues due to this rollback are estimated to be $17,762,000 between fiscal year 2015 to fiscal year 2024, and the maximum reimbursement from the State during that time period would be $16,986,000 for a net loss in revenues of $776,000. For fiscal years 2015 through 2021, the City received actual State "backfill" payments for the commercial and industrial rollback totaling $10,938,967. This bill also limited the annual taxable valuation growth of residential and agricultural property to 3 percent, instead of the previous limit of 4 percent. The impact of this provision is that the taxable percentage of residential property is expected grow at a slower pace. Without this change, the estimated taxable percentage of residential property was estimated to be 60.85% in fiscal year 2024. With this provision in place, the estimated taxable percentage in fiscal year 2024 is estimated to be 55.11%, a reduction of 5.74%. Based on the assessed value of residential property in Iowa City, the cumulative loss is estimated to be $22,638,000 from fiscal year 2015 to fiscal year 2024. The City will not receive any money from the State due to lost revenue from this provision. 9 SF295 also established a multi -residential property classification that includes mobile home parks, assisted living facilities, and property primarily intended for human habitation. A gradual rollback will be applied to these properties to eventually tax them similarly to residential property, rather than commercial, by fiscal year 2024. The estimated cumulative loss from fiscal year 2015 to fiscal year 2024 is $17,178,027, which will not be reimbursed by the State of Iowa. Fiscal year 2017 was the first year for this new class of property, and the estimated lost revenue from this provision in from fiscal year 2017 to fiscal year 2021 was $8,278,737. Due to the passage of SF295, the City estimates its net revenue losses to be $20,594,000 for fiscal years 2015 through 2021. The cumulative net revenue loss from fiscal years 2015 through 2024 is estimated to be $41,126,902. It is possible that this could affect the City's ability to finance services at current levels without finding other revenue sources or more efficient ways to deliver services. The City's long-term financial planning strategy is to promote targeted economic development, diversify its revenue structure, control spending and create efficiencies, and to build adequate reserves and contingencies into its financial structure. In addition, the City is annually reviewing and adjusting its user fees, service charges, and fine structures to try to maintain all of its major enterprise funds with a positive net income after depreciation but before capital contributions, transfers, and extraordinary items. The City also continues to strive to reduce the City's property tax levy rate to be competitive for economic development purposes. In fiscal year 2013, the City's property tax levy rate was $17.269 per $1,000 of assessed value. The property tax levy rate has been reduced for eight consecutive years to $15.673 in fiscal year 2022. This has been a reduction of $1.596 per $1,000 of assessed value or 9.24% over that time period. In looking at expenses for the FY2021— FY2023 Financial Plan and FY2022 operating budget, the City will generally experience increased expenditures; however, at a modest pace, with General Fund expenditures and total operating expenditures growing at approximately 1% or less from FY2021 to FY2022. Bargaining unit cost -of -living wage increases are approximately 2% to 4% each year. In prior years, the budgeted full-time equivalents (FTE) has generally remained flat - from 607.66 in FY2015 to 608.18 in FY2020, but in FY2021, the permanent FTE count increases to 624.08 primarily due to the conversion of temporary workers to permanent part-time or permanent full-time positions. In FY2022, three additional positions were added to support the police department bringing the City's total FTE to 627.08. In addition, public safety pension contribution rates increased slightly in FY2022 from 25.31% to 26.18%. The City has averaged a 4.95% increase in its health insurance premium rates over the previous eight years; however, is expecting an upward trend for health insurance rates in FY2022 and FY2023. Employee contributions, deductibles, and out-of-pocket maximums for health insurance are all expected to increase in FY2022, and employee contributions for health insurance are expected to increase in FY2023, which should help mitigate the impact to the City's overall premium increase. Although, personnel costs are growing at a faster pace than 1%, expenditures for services, supplies, capital outlay, and other financing uses in the General Fund are all projected to decrease in FY2022 and then remain relatively flat in FY2023. In balancing the budget for the three-year period, the City attempts to mitigate the growth of costs while continuing to provide high quality services by identifying ways to provide services more efficiently, reviewing and updating existing revenue sources to meet strategic goals, strategically funding new programming and economic development to ensure strong property value growth, providing for necessary improvements to existing infrastructure, and upholding fiscal integrity by maintaining adequate cash reserves. 10 Awards and Acknowledgements The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting (the Certificate) to the City of Iowa City, Iowa for its Annual Comprehensive Financial Report for the fiscal year ended June 30, 2020. 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 Annual Comprehensive Financial Report, whose contents conform to program standards. The Annual Comprehensive 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 thirty-six consecutive years. I believe our current report continues to conform to the Certificate requirements and I will submit it to GFOA to determine its eligibility for another certificate. In addition, the City received the GFOA's Award for Distinguished Budget Presentation for its annual appropriated budget beginning July 1, 2021. In order to qualify for the Distinguished Budget Presentation Award, the City's budget document was judged to be proficient or outstanding in several categories including policy documentation, financial planning, and organization. This is the tenth consecutive year the City has received this award. Responsibility and Acknowledgments The Department of Finance prepared the Annual Comprehensive Financial Report of the City of Iowa City, Iowa for the fiscal year ended June 30, 2021. The City Council, as required by law, is responsible for the complete and accurate preparation of the City's Annual Comprehensive 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 Assistant Finance Director, Nicole Knudtson- Davies, Accounting Coordinator, Mark Messer, Senior Accountants, TaraLynne Werthmann and Angie Ogden and Senior Payroll Accountant, Chris Hurlbert. Also, I thank the Mayor, members of the City Council and the City Manager for their interest and support in planning and conducting the financial operations of the City in a dedicated, responsible, and progressive manner. Respectfully submitted, .__ Dennis Bockenstedt Director of Finance 11 0 Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Iowa City Iowa For its Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2020 Executive Director/CEO 12 4 City of Iowa City Organization Chart Community City Council Airport Comrrission Airport Airport Operations City Attorney City Manager City Clerk Library Board -11 L City Attorney City Attorney City Manager City Clerk City Manager Communications Office Human Resources Human Rights Economic Development L City Clerk Library Library Operations Library Foundation L r Fire Administration Emergency Operations Fire Prevention Training Finance Administration Accounting Purchasing Revenue Risk Management Information Technology Services Police Administration Support Services Field Operations Parks & Recreation Administration Recreation Park Maintenance &Cemetery Neighborhood & Development Services Administration Development Services Neighborhood Services Metropolitan Planning Organization of Johnson County Public Works Administration Engineering Streets Wastewater Water Resource Management Equipment 13 Senior Center Senior Center Operations L J Transportation Services Administration Parking Public Transportation City of Iowa City, Iowa Listing of City Officials June 30, 2021 Elected Officials Term Expires Mayor Bruce Teague January 2, 2022 Council Member and Mayor Pro Tem Mazahir Salih January 2, 2022 Council Member Pauline Taylor January 2, 2024 Council Member John Thomas January 2, 2024 Council Member Susan Mims January 2, 2022 Council Member Laura Bergus January 2, 2024 Council Member Janice Weiner January 2, 2024 Appointed Officials Date of Hire City Manager Geoff Fruin November 28, 2011 City Clerk Kellie Fruehling July 10, 2000 City Attorney Eric Goers September 7, 2005 Department Directors Deputy City Manager Redmond Jones II September 20, 2021 Director of Neighborhood Development Services Tracy Hightshoe August 27, 2001 Library Director Elsworth Carman January 2, 2019 Director of Public Works Ron Knoche April 28, 1999 Director of Transportation Services Darian Nagle Gamm May 21, 2008 Senior Center Coordinator LaTasha DeLoach July 31, 2018 Fire Chief John Grier August 10, 1992 Parks and Recreation Director Juli Seydell Johnson January 4, 2016 Director of Finance Dennis Bockenstedt February 15, 2013 Chief of Police Dustin Liston January 11, 2021 14 Financial Section Tabs Certified Public Accountants B Bohnsack & Frornmelt LLP Independent Auditor's Report To the Honorable Mayor and Members of City Council City of Iowa City, Iowa Iowa City, Iowa Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. 15 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, 2021, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, budgetary comparison information, schedule of changes in the City's total OPEB liability and related ratios, schedules of the City's proportionate share of the net pension liabilities for pension retirement systems, and schedules of the City's contributions for pension retirement systems on pages 19-29 and 78-91, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The combining and individual nonmajor fund financial statements, schedule of expenditures of federal awards as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and the other information, including the introductory and statistical sections, are presented for purposes of additional analysis and are not a required part of the basic financial statements. 16 The combining and individual nonmajor fund financial statements and schedule of expenditures of federal awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information of the combining and individual nonmajor fund financial statements and schedule of expenditures of federal awards is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 3, 2021 on our consideration of the City's internal control over financial reporting and on 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 internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial reporting and compliance. 1;41,1.444, Aix-ingA Lt -P Moline, Illinois December 3, 2021 17 (This page left blank intentionally.) 18 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, 2021. 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 — 11 of this report. Financial Highlights • The assets and deferred outflows of resources of the City of Iowa City exceeded its liabilities and deferred inflows of resources at the close of the fiscal year ending June 30, 2021 by $702,481,000 (net position). Of this amount, $109,625,000 (unrestricted net position) may be used to meet the government's ongoing obligations to its citizens and creditors. • The City's total net position increased by $18,338,000 during the fiscal year. Governmental activities increased by $12,209,000 and business -type activities increased by $6,129,000. • At the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of $104,343,000, an increase of $12,575,000 in comparison with the prior year. Of this total amount, approximately $40,387,000 or 38.7% is unassigned and available for spending at the City's discretion. • At the end of the current fiscal year, the City's unassigned fund balance for the General Fund was $40,414,000 or 78.9% of total General Fund expenditures. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's basic financial statements are comprised of three components: 1) government -wide financial statements, 2) fund financial statements; and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government -wide Financial Statements: The government -wide financial statements are designed to provide readers with a broad overview of the City's finances in a manner similar to a private -sector business. The statement of net position presents information on all of the City's assets and deferred outflows of resources, liabilities and deferred inflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). Both of the government -wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business -type activities). The governmental activities of the City include Public Safety, Public Works (roads and traffic controls), Culture and Recreation, Community and Economic Development, General Government, and Interest on long-term debt. The business -type activities of the City include Airport, Housing Authority, Parking, Sanitation, Stormwater Collection, Transit, Wastewater Treatment, and Water. The government -wide financial statements may be found on pages 30 — 33 of this report. 19 Fund Financial Statements: A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental Funds: Governmental funds are used to account for essentially the same function reported as governmental activities in the government -wide financial statements. However, unlike the government -wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements and is typically the basis that is used in developing the next annual budget. Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government -wide financial statements. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison. The City has six major governmental funds: General Fund, Other Shared Revenue and Grants Fund, Employee Benefits Fund, Other Construction Fund, Bridge, Street and Traffic Control Construction Fund, and Debt Service Fund. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balances for these major funds. Data from all other non -major governmental funds is combined into a single aggregated presentation and are referenced under a single column as "Other Governmental Funds". Individual fund data on each of these non - major governmental funds is provided in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for all governmental funds as required by state statute. Budget comparisons have been provided for the Governmental funds and the Enterprise funds, to demonstrate compliance with the adopted budget. The basic governmental funds financial statements can be found on pages 34 — 37 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, Housing Authority, Parking, Sanitation, Stormwater Collection, Transit, Wastewater Treatment, and Water activities. Internal Service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions. The City has four Internal Service Funds: Equipment Maintenance, Central Services, Loss Reserve, and Information Technology. Because these services predominantly benefit governmental rather than business -type functions, they have been included within governmental activities in the government -wide financial statements. Proprietary funds financial statements provide the same type of information as the government -wide financial statements, only in more detail. Transit, Wastewater Treatment, Water, Sanitation, Stormwater and Housing Authority are considered to be major funds and are reported individually throughout the report. The other two 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 98 — 100. Individual fund data for the Internal Service funds is provided in the form of combining statements elsewhere in this report. The basic proprietary fund financial statements can be found on pages 38 — 40 of this report. Fiduciary Funds: Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not available to support the City's own programs and therefore are not reflected in the government -wide financial statements. The City has one fiduciary fund: Project Green, which is maintained as a custodial fund. 20 The basic fiduciary funds financial statements can be found on pages 41 - 42. 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 43 - 76 of this report. Other Information: The combining statements referred to in the above paragraphs in connection with non - major governmental funds and internal service funds are presented immediately following the notes. Government -wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $702,481,000 at the close of the fiscal year ended June 30, 2021. By far, the largest portion of the City's net position reflect its investment in capital assets (e.g., land, building, machinery and equipment, improvements other than buildings, and infrastructure), net any related debt to acquire those assets that is still outstanding. The City uses these capital assets to provide services to its citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other resources, since the capital assets themselves cannot be used to liquidate these liabilities. City of Iowa City's Net Position June 30, 2021 (amounts expressed in thousands) Governmental activities Business -type activities Total 2021 2020 2021 2020 2021 2020 Current and other assets $ 212,461 $ 192,519 $ 126,921 $ 121,004 $ 339,382 $ 313,523 Capital assets 278,615 273,877 328,262 331,450 606,877 605,327 Total assets 491,076 466,396 455,183 452,454 946,259 918,850 Deferred outflows of resources 14,461 11,421 2,684 2,385 17,145 13,806 Long-term liabilities outstanding 126,757 118,763 36,360 38,531 163,117 157,294 Current and other liabilities 22,513 14,198 6,025 5,971 28,538 20,169 Total liabilities 149,270 132,961 42,385 44,502 191,655 177,463 Deferred inflows of resources 68,657 69,455 611 1,595 69,268 71,050 Net position: Net investment in capital assets 228,418 220,004 315,915 314,523 544,333 534,527 Restricted 33,664 33,578 14,859 17,558 48,523 51,136 Unrestricted 25,528 21,819 84,097 76,661 109,625 98,480 Total net position $ 287,610 $ 275,401 $ 414,871 $ 408,742 $ 702,481 $ 684,143 21 A portion of the City's net position, $48,523,000 or 6.9%, represents resources that are subject to external restrictions on how they may be used. The remaining balance of the unrestricted net position, $109,625,000 or 15.6%, may be used to meet the government's ongoing obligations to its citizens and creditors. At the end of the fiscal year ended June 30, 2021, the City is able to report positive balances in all three categories of net position, both for the government as a whole, as well as for its separate governmental and business -type activities. The following is a more detailed review of FY21's operation. Governmental Activities: Governmental activities increased the City's net position by $12,209,000. The increase in net position of governmental activities is primarily from an increase in property taxes. The total revenues for governmental activities for FY21 were $101,553,000. Governmental activities are primarily funded through taxes, $72,058,000 or 71.0%, and grants and contributions, $16,911,000 or 16.7%. Taxes increased from the prior year by $6,516,000, mostly due to increased property taxes which was due to an increase in the taxable value of all property and the addition of the emergency levy. Grants and contributions increased from prior year by $370,000 due mainly to additional funding from the CARES Act. Expenses for governmental activities totaled $83,187,000. Governmental activities are tracked by function including Public Safety, Public Works, Community and Economic Development, Culture and Recreation, and General Government. In FY21, Public Safety accounted for the highest portion of governmental expenses, $30,411,000 or 36.6%, and increased over the prior year due to increases in salaries and benefits. Public Works expenses of $16,363,000 or 19.7% made up another large portion of the governmental expenses and had a slight increase in expenses from the prior year. Culture and Recreation expenses of $15,774,000 or 19.0% made up the third highest portion of governmental expenses and had a slight decrease in expenses from the prior year. Business -type Activities: Business -type activities increased the City's total net position by $6,129,000. The increase in net position was primarily from the Sanitation, Wastewater Treatment and Stormwater funds. Sanitation generated operating income of $1,078,000. Wastewater also received $853,000,000 from the state for the redevelopment of the land that was the site of the former wastewater treatment plant. Wastewater and Stormwater funds received contributions of infrastructure assets from developers. Wastewater and Stormwater received $726,000 and $1,203,000, respectively. Revenues for business -type activities totaled $59,515,000. The primary revenue source for business -type activities is charges for services, $41,549,000 or 69.8%. In addition for FY21, the City's business type -activities had a significant portion, $17,090,000 or 28.7%, of their revenues from grants and contributions used to help fund operation and capital projects for business -type activities. The total expenses for business -type activities in FY21 were $59,543,000. Wastewater Treatment represented the highest portion of business -type activities, $12,520,000 or 21.0%, with Water, $10,177,000 or 17.1%, Housing Authority, $10,141,000 or 17.0%, Sanitation, $10,045,000 or 16.9% and Transit, $8,107,000 or 13.6%, making up the remainder of the majority of business -type activities expenses. 22 City of Iowa City's Changes in Net Position (amounts expressed in thousands) Governmental Business -type activities activities Total 2021 2020 2021 2020 2021 2020 Revenues: Program Revenues: Charges for services $ 8,500 $ 6,791 $ 41,549 $ 41,135 $ 50,049 $ 47,926 Operating grants and contributions 12,479 13,113 13,102 13,911 25,581 27,024 Capital grants and contributions 2,845 1,915 3,988 4,525 6,833 6,440 General Revenues: Property taxes 69,482 62,846 69,482 62,846 Other taxes 2,576 2,696 2,576 2,696 Grants and contributions not restricted to specific purposes 1,587 1,513 - - 1,587 1,513 Earnings on investments 841 2,585 426 1,794 1,267 4,379 Gain on disposal of capital assets 213 111 22 74 235 185 Other 3,030 3,331 428 565 3,458 3,896 Total revenues 101,553 94,901 59,515 62,004 161,068 156,905 Expenses: Public safety 30,411 29,252 30,411 29,252 Public works 16,363 16,071 16,363 16,071 Culture and recreation 15,774 16,233 15,774 16,233 Community and economic development 8,549 9,383 8,549 9,383 General government 10,529 7,693 10,529 7,693 Interest on long-term debt 1,561 1,452 - 1,561 1,452 Wastewater treatment - - 12,520 10,807 12,520 10,807 Water - 10,177 9,302 10,177 9,302 Sanitation - 10,045 10,145 10,045 10,145 Housing authority 10,141 10,021 10,141 10,021 Parking 4,613 5,014 4,613 5,014 Airport 1,835 2,511 1,835 2,511 Stormwater 2,105 2,198 2,105 2,198 Transit - 8,107 9,041 8,107 9,041 Total expenses 83,187 80,084 59,543 59,039 142,730 139,123 Change in net position before transfers 18,366 14,817 (28) 2,965 18,338 17,782 Transfers (6,157) (6,387) 6,157 6,387 - Change in net position 12,209 8,430 6,129 9,352 18,338 17,782 Net position beginning of year 275,401 266,971 408,742 399,390 684,143 666,361 Net position end of year $ 287,610 $ 275,401 $ 414,871 $ 408,742 $ 702,481 $ 684,143 The graphs on the following pages represent a breakdown of revenue by source and expenses by program area for governmental and business -type activities. 23 Governmental Activities FY2021 Revenue by Source - taxes 68% Other Taxes 3% Misc. Charges for Other services 40/0 80/0 Grants and Contributions 29% Business -Type Activities FY2021 Revenue by Source Misc. Other 1% Charges for services 70% Grants and Contributions 17% 24 i 32,000 30,000 28,000 26,000 24,000 22,000 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 22,000 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 — Public Safety Governmental Activities FY2021 Expenses by Program Area (amounts expressed in thousands) Public Culture and Works Recreation General Com and Govt Econ Dev Program Area Business -Type Activities FY2021 Expenses by Program Area (amounts expressed in thousands) Interest Expense Wastewater Treatment Housing Water SanitationAuthority Parking Airport Transit ormwa er Program Area 25 Financial Analysis of the Government's Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Governmental Funds: The financial reporting focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information may be/is useful in assessing the City's financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. Fund balances for the governmental funds are reported in classifications that comprise a hierarchy based on the extent to which the government honors constraints on the specific purposes for which amounts in those funds can be spent. As of the fiscal year ended June 30, 2021, the City's governmental funds reported combined ending fund balances of $104,343,000, an increase of $12,575,000 in comparison with the prior year. Of this total amount, $40,387,000 constitutes unassigned fund balance, which is available to use as working capital for the General Fund since property tax revenues are received only twice a year and the remainder is available to meet the future needs of the City. The remainder of the fund balance is not available for new spending because of constraints imposed externally by creditors, grantors, contributors, or laws or regulations of other governments or constraints imposed internally on the specific purposes for which these amounts can be spent. The restricted fund balance of $53,386,000 or 51.2% contains external restraints on its use. The assigned fund balances of $9,883,000 or 9.5% has been identified by the City to be used for specific purposes. The nonspendable fund balance is $687,000 or 0.7%, which the City is contractually required to maintain intact or cannot be spent because it is in a nonspendable format, such as inventories. The General Fund is the chief operating fund of the City. As of the fiscal year ended June 30, 2021, the unassigned fund balance of the General Fund was $40,414,000 while General Fund's total fund balance was $52,221,000. As a measure of the General Fund's liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 78.9% of total General Fund expenditures of $51,238,000, while total fund balance represents 101.9% of that same amount. During the current fiscal year, the fund balance of the City's General Fund increased by $8,848,000. This is due to transfers in from other funds and an increase in property taxes. The fund balance in the Bridge, Street, and Traffic Control Construction Fund was $18,291,000, an increase of $2,449,000. This fund accounts for transactions relating to the acquisition or construction of major streets, bridges, and traffic control facilities. The change in the fund balance is due to bond sales. The fund balance in the Other Construction Fund was $8,178,000, a decrease of $585,000. This fund accounts for the construction or replacement of other governmental general capital assets, such as administrative buildings, with various funding sources, including general obligation bonds, intergovernmental revenues, and contributions. This decrease is mainly due to a decrease in grant revenue. The ending fund balance of the Debt Service Fund was $7,551,000, a decrease of $2,173,000, all of which is reserved for the payment of debt service (i.e. payment of general obligation principal and interest). The ending fund balance of the Employee Benefits Fund was $3,631,000, an increase of $46,000. The ending fund balance of the Other Shared Revenue and Grants Fund was $9,312,000, an increase of $3,557,000 due to $1,800,000 developer fee for affordable housing, $1,016,000 for the emergency levy and a $914,000 in road use taxes received. 26 Proprietary Funds: The City's proprietary funds provide the same type of information found in the government -wide financial statements, but in more detail. The ending net position of the enterprise funds was $393,665,000, an increase in net position of $4,232,000. This was primarily due to capital contributions of federal and state grants to fund capital improvement projects and transfers of business -type capital assets from governmental capital project funds. Of the enterprise funds' net position, $315,915,000 is net investment in capital assets. Unrestricted net position totaled $62,881,000, an increase of $5,539,000 compared to the previous year. The Internal Service funds showed net position totaling $51,364,000 as of June 30, 2021, an increase of $3,554,000 primarily due to operating income in the Equipment Reserve Fund to build up reserves for future capital outlay. Budgetary Highlights The City presents budgetary information as allowed by GASB Statement No. 41. Budgets are based on nine functional areas as required by state statute, not by fund or fund type. The City had two budget amendments during the fiscal year. These amendments increased budgeted revenues by $8,868,000 or 5.4% to a total of $171,890,000 and the expenditure budget by $47,462,000 or 27.0% to a total of $222,965,000. These increases were due primarily to capital projects in governmental and business - type funds because of timing of completion of projects. 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, 2021 amounts to $606,877,000, net of accumulated depreciation. This investment in capital assets, including land, buildings, improvements other than buildings, equipment, streets, bridges, trails, wastewater and water systems, and other infrastructure represents the value of resources utilized to provide services to its citizens. The City's investment in capital assets for the fiscal year ended June 30, 2021 increased by $4,739,000 for governmental activities compared to the prior year and decreased by $3,189,000 for business -type activities from the prior year. The following table reflects the $606,877,000 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 2021 2020 2021 2020 2021 2020 Land $ 32,821 $ 31,159 $ 30,317 $ 30,317 $ 63,138 $ 61,476 Buildings 37,030 37,467 61,615 63,080 98,645 100,547 Improvements other than buildings 3,480 3,568 3,756 3,635 7,236 7,203 Machinery and equipment 34,675 31,057 14,784 16,301 49,459 47,358 Infrastructure 165,377 160,625 214,714 214,010 380,091 374,635 Construction in progress 5,233 10,001 3,075 4,107 8,308 14,108 Total $ 278,616 $ 273,877 $ 328,261 $ 331,450 $ 606,877 $ 605,327 27 Major capital asset events during the current fiscal year included the following: • Two large construction projects were completed during FY 21. The first is the Burlington & Madison Intersection Improvements. This project reconstructed the intersection of Burlington and Madison to add turn lanes on Madison, signal improvements, and the replacement of water and sewer mains This project had construction in progress balance at the beginning of the year of $944,000 and current year expenditures of $1,283,000. The total cost of the project that was capitalized was $2,227,000. The project was funded by bond sales and cash on hand from the Wastewater and Stormwater Funds. The other project is the construction of McCollister Blvd from Gilbert to Sycamore which had a construction in progress balance at the beginning of the year of $2,538,000 and current year expenditures of $2,243,000. The total cost of the project that was capitalized was $4,781,000 and it was primarily funded through bond sales. This project constructed a new arterial roadway from Gilbert to Sycamore and included protected bike lanes. Additional information on the City's capital assets can be found in Note 4 to the financial statements. Debt Administration: At the end of the fiscal year, the City had total bonded debt outstanding of $78,555,000. Of this amount, $53,935,000 comprises debt backed by the full faith and credit of the City. $2,419,000 or 4.5% of these bonds is debt that will be paid with Tax Increment Financing revenues. $24,620,000 represents revenue bonds secured solely by specific revenue sources. The City issued $11,325,000 of General Obligation bonds during FY21. This increase in debt was offset by the retirement of debt for a net decrease of City's total bonded debt by $5,670,000. City of Iowa City's Outstanding Debt General Obligation and Revenue Bonds (amounts expressed in thousands) Governmental Busine s s -type Activities Activities Total 2021 2020 2021 2020 2021 2020 General obligation bonds $ 53,935 $ 53,370 $ - $ - $ 53,935 $ 53,370 Revenue bonds 12,805 14,790 11,815 16,065 24,620 30,855 Total $ 66,740 $ 68,160 $ 11,815 $ 16,065 $ 78,555 $ 84,225 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, 2021 were as follows: General obligation bonds Aaa Wastewater treatment revenue bonds Aa2 Water revenue bonds Aa2 The City continues to operate well under the State debt capacity debt limitations. State statute limits the amount of debt outstanding to 5% of the assessed value of all taxable property in Iowa City. Debt subject to the debt limit includes general obligation debt and revenue bonds issued pursuant to Iowa Code Chapter 403 (tax increment). The current debt limitation for the City is $342,895,000. With outstanding debt applicable to this limit of $103,895,000 we are utilizing 30.3% of this limit. More detailed information on debt administration is provided in Note 5 of the financial statements. 28 Economic Factors and Next Year's Budget and Rates The City expects continued constraints by the State's property tax formula. The State passed property tax reform, which will negatively affect the City's general operating funds. Without the potential for new revenue sources, like those mentioned above, the City's opportunities for new initiatives are limited. The Council has established a budget where revenues exceed expenditures by $1 million in the General Fund for FY22 that strives to maintain current service delivery levels. The tax levy rate per $1,000 of assessed valuation for FY22 is provided below: General Levy $ 8.100 Debt Service Levy 2.479 Employee Benefits Levy 3.344 Transit Levy 0.950 Liability Insurance Levy 0.290 Library Levy 0.270 Emergency Levy 0.240 Total City Levy $ 15.673 Requests for Information This report is designed to provide a general overview of the City of Iowa City's finances for all of those with an interest in the government's finances. Questions concerning any of the information provided in this report, or requests for additional financial information should be addressed to City of Iowa City, Finance Department, 410 East Washington Street, Iowa City, IA, 52240. 29 City of Iowa City, Iowa Statement of Net Position June 30, 2021 (amounts expressed in thousands) Governmental Business -type Activities Activities Total Assets Equity in pooled cash and investments $ 130,934 $ 65,807 $ 196,741 Receivables: Property tax 67,644 - 67,644 Accounts and unbilled usage 1,002 4,311 5,313 Interest 76 64 140 Notes 5,141 336 5,477 Internal balances (24,229) 24,229 - Due from other governments 5,651 2,774 8,425 Inventories 786 731 1,517 Assets held for resale 400 - 400 Restricted assets: Equity in pooled cash and investments 25,056 28,669 53,725 Capital assets: Land and construction in progress 38,054 33,392 71,446 Other capital assets (net of accumulated depreciation) 240,561 294,870 535,431 Total assets 491,076 455,183 946,259 Deferred Outflows of Resources Pension related deferred outflows OPEB related deferred outflows Total deferred outflows of resources 12,833 1,628 14,461 2,067 617 2,684 14,900 2,245 17,145 Liabilities Accounts payable 2,913 1,260 4,173 Contracts payable 2,840 1,165 4,005 Accrued liabilities 5,958 731 6,689 Interest payable 163 185 348 Deposits 1,124 2,280 3,404 Advances from grantors 9,470 9,470 Due to other governments 45 52 97 Unearned revenue 352 352 Noncurrent liabilities: Due within one year: Employee vested benefits 1,546 518 2,064 Bonds payable 11,536 4,597 16,133 Due in more than one year: Employee vested benefits 1,204 370 1,574 Net pension liability 47,299 9,315 56,614 Other post employment benefits liability 7,030 2,669 9,699 Notes payable 211 - 211 Bonds payable 57,931 7,645 65,576 Landfill closure/post-closure liability - 11,246 11,246 Total liabilities $ 149,270 $ 42,385 $ 191,655 (continued) City of Iowa City, Iowa Statement of Net Position (continued) June 30, 2021 (amounts expressed in thousands) Governmental Business -type Activities Activities Total Deferred Inflows of Resources Pension related deferred inflows $ 1,253 $ 319 $ 1,572 OPEB related deferred inflows 492 187 679 Deferred amount on refunding - 105 105 Succeeding year property taxes 66,912 - 66,912 Total deferred inflows of resources 68,657 611 69,268 Net Position Net investment in capital assets 228,418 315,915 544,333 Restricted for or by: Employee benefits 3,973 - 3,973 Capital projects: Expendable 12,266 - 12,266 Nonexpendable 218 - 218 Debt service 7,388 - 7,388 Police 271 - 271 Other purposes Expendable 6,300 - 6,300 Nonexpendable 69 - 69 Bond ordinance - 9,814 9,814 State statute - 3,359 3,359 Future improvements - 404 404 Grant agreement 3,179 1,282 4,461 Unrestricted 25,528 84,097 109,625 Total net position $ 287,610 $ 414,871 $ 702,481 The notes to the financial statements are an integral part of this statement. 32 Functions/Programs: Expenses City of Iowa City, Iowa Statement of Activities For the Year Ended June 30, 2021 (amounts expressed in thousands) Program Revenues Operating Capital Charges Grants and Grants and for Services Contributions Contributions Governmental activities: Public safety Public works Culture and recreation Community and economic development General government Interest on long-term debt Total governmental activities Business -type activities: Wastewater treatment Water Sanitation Housing authority Parking Airport Stormwater Transit Total business -type activities Total $ 30,411 $ 16,363 15,774 8,549 10,529 1,561 4,277 482 322 1,837 1,582 $ 281 $ 10,078 10 1,920 190 2,845 83,187 8,500 12,479 2,845 12,520 12,155 - 1,580 10,177 9,934 45 834 10,045 11,944 18 10,141 296 9,691 4,613 3,758 - 1,835 376 332 267 2,105 1,701 - 1,230 8,107 1,385 3,016 77 59,543 41,549 13,102 3,988 $ 142,730 $ 50,049 $ 25,581 $ 6,833 General revenues: Property taxes, levied for general purposes Hotel/motel tax Gas and electric tax Utility franchise tax Grants and contributions not restricted to specific purposes Earnings on investments Gain on disposal of capital assets Miscellaneous Transfers Total general revenues and transfers Changes in net position Net position beginning of year Net position end of year The notes to the financial statements are an integral part of this statement. 33 Net (Expense) Revenue and Changes in Net Position Governmental Business -type Activities Activities Total $ (25,853) $ (2,958) (15,442) (4,792) (8,757) (1,561) $ (25,853) (2,958) (15,442) (4,792) (8,757) (1,561) (59,363) (59,363) 1,215 1,215 636 636 1,917 1,917 (154) (154) (855) (855) (860) (860) 826 826 (3,629) (3,629) (904) (904) (59,363) (904) (60,267) 69,482 69,482 938 938 644 644 994 994 1,587 1,587 841 426 1,267 213 22 235 3,030 428 3,458 (6,157) 6,157 - 71,572 7,033 78,605 12,209 6,129 18,338 275,401 408,742 684,143 $ 287,610 $ 414,871 $ 702,481 City of Iowa City, Iowa Balance Sheet Governmental Funds June 30, 2021 (amounts expressed in thousands) Special Revenue Capital Projects Bridge, Other Street, and Shared Traffic Other Revenue and Employee Other Control Debt Governmental General Grants Benefits Construction Construction Service Funds Total Assets Equity in pooled cash and investments $ 51,870 $ 13,671 $ 3,517 $ 4,612 $ 8,559 $ 7,122 $ 1,861 $ 91,212 Receivables: Property tax 40,959 10 15,264 - 10,896 515 67,644 Accounts and unbilled usage 508 3 4 311 - - 826 Interest 24 2 6 9 3 44 Notes 1,073 520 - 249 3,299 5,141 Due from other funds 174 - - 174 Advances to other funds - 67 67 Due from other governments 2,080 1,428 371 327 1,322 59 5,587 Inventories - 218 - 218 Assets held for resale 400 400 Restricted assets: Equity in pooled cash and investments 2,134 3,615 7,910 11,397 25,056 Total assets $ 99,222 $ 19,467 $ 19,152 $ 12,859 $ 21,598 $ 18,337 $ 5,734 $ 196,369 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable $ 1,672 $ 442 $ Contracts payable - - Accrued liabilities 1,957 128 Advances from other funds - 67 Due to other governments 38 Liabilities payable from restricted assets: Deposits 1,115 9 Advances from grantors 19 9,165 Total liabilities 4,801 9,811 20 $ 33 $ 20 $ $ 90 $ 2,277 879 1,961 - - 2,840 2 - 4 - 30 2,121 - 3,187 - - 3,254 38 261 1,124 25 9,470 22 4,360 1,985 145 21,124 Deferred Inflows of Resources Unavailable revenues: Succeeding year property taxes 40,568 15,128 10,786 430 66,912 Grants 4 344 - 226 1,322 - 1,896 Other 1,628 371 95 - - 2,094 Total deferred inflows of resources 42,200 344 15,499 321 1,322 10,786 430 70,902 Fund Balances Nonspendable 469 218 - 687 Restricted 1,455 9,094 3,631 8,178 18,291 7,551 5,186 53,386 Assigned 9,883 9,883 Unassigned 40,414 (27) 40,387 Total fund balances 52,221 9,312 3,631 8,178 18,291 7,551 5,159 104,343 Total liabilities, deferred inflows of resources and fund balances $ 99 222 $ 19,467 $ 19,152 $ 12,859 $ 21 598 $ 18 337 $ 5 734 $ 196 369 The notes to the financial statements are an integral part of this statement. 34 City of Iowa City, Iowa Reconciliation of the Balance Sheet of the Governmental Funds to the Statement of Net Position June 30, 2021 (amounts expressed in thousands) Total governmental fund balances $ 104,343 Amounts reported for governmental activities in the statement of net position are different because: Internal service funds are used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position. Other long-term assets are not available to pay for current period expenditures and therefore are unavailable in the funds: Grants and other receivables - Earned but unavailable. 51,364 3,990 Capital assets used in governmental activities are not current financial resources and therefore are not reported in the funds. 261,627 Pension and OPEB related deferred outflows of resources and deferred inflows of resources are not due and payable in the current period and therefore are not reported in the funds. Deferred outflows of resources Deferred inflows of resources Net pension liabilities are not due and payable in the current period and therefore are not reported in the funds. Accrued compensated absences are not due and payable in the current period and therefore are not reported in the funds. $ 14,032 (1,666) 12,366 (45,736) (2,621) Accrued post employment benefit liabilities are not due and payable in the current period and therefore are not reported in the funds. (6,666) Bonds payable are not due and payable in the current period and therefore are not reported in the funds. (69,467) Notes payable are not due and payable in the current period and therefore are not reported in the funds. (211) Accrued interest on bonds (163) Internal balance due to integration of internal service funds (21,216) Total net position of governmental activities $ 287,610 The notes to the financial statements are an integral part of this statement. 35 City of Iowa City, Iowa Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds General For the Year Ended June 30, 2021 (amounts expressed in thousands) Special Revenue Capital Projects Bridge, Other Street, and Shared Traffic Other Revenue and Employee Other Control Debt Governmental Grants Benefits Construction Construction Service Funds Total Revenues Taxes $ 42,635 $ 1,016 $ 14,162 $ - $ $ 11,141 $ 3,104 $ 72,058 Licenses and permits 2,541 - - - - - - 2,541 Intergovernmental 5,924 10,112 321 47 1,666 250 1,807 20,127 Charges for services 808 1,875 317 91 355 3,446 Fines and forfeits 375 - 375 Use of money and property 456 95 - 48 69 62 43 773 Miscellaneous 1,688 94 10 277 43 2,112 Total revenues 54,427 13,192 14,800 196 2,367 11,453 4,997 101,432 Expenditures Current: Public safety 24,764 1,374 29 - - 26,167 Public works 2,076 6,494 225 2,652 - - 11,447 Culture and recreation 12,407 - - 572 - 12,979 Community and economic development 3,487 910 163 - 3,745 8,305 General government 6,676 148 417 2,501 - 46 - 9,788 Debt service: Principal - - - - - 12,745 - 12,745 Interest - - - - - 1,905 - 1,905 Capital outlay 1,828 267 - 4,138 5,940 - 12,173 Total expenditures 51,238 7,819 1,791 7,628 8,592 14,696 3,745 95,509 Excess (deficiency) of revenues over (under) expenditures 3,189 5,373 13,009 (7,432) (6,225) (3,243) 1,252 5,923 Other Financing Sources (Uses) Issuance of debt - 4,552 6,184 589 11,325 Sale of capital assets 233 - - - 233 Premiums on issuance of bonds - - 588 801 75 - 1,464 Transfers in 12,567 1,622 1,729 3,848 1,026 431 21,223 Transfers out (7,141) (3,438) (12,963) (22) (2,159) (620) (1,250) (27,593) Total other fmancing sources and (uses) 5,659 (1,816) (12,963) 6,847 8,674 1,070 (819) 6,652 Net change in fund balances 8,848 3,557 46 (585) 2,449 (2,173) 433 12,575 Fund Balances, Beginning 43,373 5,755 3,585 8,763 15,842 9,724 4,726 91,768 Fund Balances, Ending $ 52,221 $ 9,312 $ 3,631 $ 8,178 $ 18,291 $ 7,551 $ 5,159 $ 104,343 The notes to the financial statements are an integral part of this statement. 36 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, 2021 (amounts expressed in thousands) Net change in fund balances - total governmental funds $ 12,575 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the asset. Capital outlays and contributed capital assets exceeded depreciation expense in the current year as follows: Expenditures for capital assets $ 9,992 Transfers of capital assets (to)\from enterprise funds - net (289) Transfers of capital assets (to)\from internal service funds - net (86) Capital assets contributed 1,099 Depreciation expense (8,366) 2,350 Bond proceeds are reported as other financing sources in governmental funds and thus contribute to the change in fund balance. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities. Similarly, repayment of principal is an expenditure in the governmental funds but reduces the liability in the statement of net position. Debt issued (11,325) Premium on bonds issued (1,464) Repayments of debt 12,745 Amortization of premium 349 305 Because some revenues will not be collected for several months after the City's year end, they are not considered available revenues in the governmental funds. (1,259) Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds: Change in accrued compensated absences (26) Pension expense (2,896) Change in accrued post employment benefit liability (361) Change in accrued interest on debt (5) In the statement of activities, only the gain on the sale of the capital assets is recognized, whereas in the governmental funds, the proceeds from the sale increased financial resources. Thus, the change in net position differs from the change in fund balance by the cost of the capital asset sold. Internal service funds are used by management to charge the costs of certain activities to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities. (131) 1,657 Change in net position of governmental activities $ 12,209 The notes to the financial statements are an integral part of this statement. 37 City of Iowa City, Iowa Statement of Net Position Proprietary Funds June 30, 2021 (amounts expressed in thousands) Governmental Business -type Activities - Enterprise Funds Activities - Other Internal Wastewater Housing Enterprise Service Transit Treatment Water Sanitation Stormwater Authority Funds Total Funds Assets Current assets: Equity in pooled cash and investments $ 7,630 $ 22,391 $ 9,978 $ 14,944 $ 2,927 $ 4,739 $ 3,198 $ 65,807 $ 39,722 Receivables (net of allowance for uncollectibles): Accounts and unbilled usage 76 1,585 1,294 796 185 27 348 4,311 176 Interest 4 14 8 18 1 18 1 64 32 Notes - - 336 - 336 Due from other governments 2,265 2 9 36 46 416 2,774 64 Inventories 395 336 - - 731 568 Total current assets 10,370 23,992 11,625 15,794 3,113 5,166 3,963 74,023 40,562 Noncurrent assets: Restricted assets: Equity in pooled cash and investments 4 6,286 4,844 14,637 2,783 115 28,669 Advances to other funds 4,224 - 4,224 Capital assets: Land 2,630 759 6,296 2,264 2,264 620 15,484 30,317 685 Buildings 15,399 36,858 24,019 5,402 - 7,427 47,105 136,210 1,481 Improvements other than buildings - 7,802 2,742 440 34 773 11,791 50 Machinery and equipment 12,348 13,012 11,566 252 27 71 2,153 39,429 25,094 Infrastructure 955 160,722 73,357 19,344 70,098 - 17,451 341,927 3,605 Accumulated depreciation (15,325) (93,817) (45,081) (19,433) (18,952) (5,005) (36,874) (234,487) (13,993) Construction in progress - 1,533 113 - 1,277 - 152 3,075 66 Total noncurrent assets 16,011 133,155 77,856 27,130 54,714 5,930 46,359 361,155 16,988 Total assets 26,381 157,147 89,481 42,924 57,827 11,096 50,322 435,178 57,550 Deferred Outflows of Resources Pension related deferred outflows 584 316 391 417 30 133 196 2,067 346 OPEB related deferred outflows 188 84 116 129 6 36 58 617 83 Total deferred outflows of resources 772 400 507 546 36 169 254 2,684 429 Liabilities Current liabilities: Accounts payable 282 241 278 241 23 99 96 1,260 636 Contracts payable 74 961 17 - 73 40 1,165 - Accrued liabilities 248 93 126 141 12 45 66 731 3,837 Employee vested benefits 142 70 87 109 8 41 61 518 72 Due to other funds - 174 174 - Due to other governments 16 6 30 - 52 7 Unearned revenue 352 352 Interest payable 100 85 185 Bonded debt payable (net of unamortized premium and discounts) 2,877 1,720 4,597 Total current liabilities 746 4,342 2,329 497 116 567 437 9,034 4,552 Noncurrent liabilities: Liabilities payable from restricted assets: Deposits 4 1,111 10 - 1,146 9 2,280 Advances from other funds - - 1,037 1,037 Employee vested benefits 95 52 58 83 6 32 44 370 57 Bonded debt payable (net of unamortized premium and discounts) 2,153 5,492 - - 7,645 Net pension liability 2,669 1,412 1,789 1,859 120 594 872 9,315 1,563 Other post employment benefits liability 810 363 503 559 28 154 252 2,669 364 Landfill closure/postclosure liability 11,246 - - 11,246 - Total noncurrent liabilities 3,578 3,980 8,953 13,757 154 1,926 2,214 34,562 1,984 Total liabilities 4,324 8,322 11,282 14,254 270 2,493 2,651 43,596 6,536 Deferred Inflows of Resources Pension related deferred inflows OPEB related deferred inflows Deferred amount on refunding Total deferred inflow of resources 92 48 61 64 4 20 30 319 57 25 35 39 2 11 18 187 49 56 - - 105 53 26 149 122 152 103 6 31 48 611 79 Net Position Net investment in capital assets 16,007 121,790 65,744 8,269 54,714 3,147 46,244 315,915 16,988 Restricted by bond ordinance 6,185 3,629 - - - 9,814 Restricted by state statute 3,359 - 3,359 Restricted for future improvements - 404 404 Restricted by grant agreement - - - - - 1,282 - 1,282 - Unrestricted 6,673 21,128 9,181 17,485 2,873 4,312 1,229 62,881 34,376 Total net position $ 22,680 $ 149,103 $ 78,554 $ 29,113 $ 57,587 $ 8,741 $47,877 $ 393,655 $ 51,364 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds. Net position of business -type activities The notes to the financial statements are an integral part of this statement. 38 21,216 $ 414,871 City of Iowa City, Iowa Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Governmental Business -type Activities - Enterprise Funds Activities - Other Internal Wastewater Housing Enterprise Service Transit Treatment Water Sanitation Stormwater Authority Funds Total Funds Operating Revenues: Charges for services $ 1,385 $ 12,155 $ 9,934 $11,944 $ 1,701 $ 296 $ 4,134 $41,549 $ 22,638 Miscellaneous 79 89 15 96 17 84 48 428 - Total operating revenues 1,464 12,244 9,949 12,040 1,718 380 4,182 41,977 22,638 Operating Expenses: Personal services 4,634 3,417 3,839 3,913 354 1,029 1,988 19,174 2,606 Commodities 781 1,960 1,439 295 74 19 421 4,989 2,441 Services and charges 1,672 2,497 2,193 5,921 292 8,853 1,843 23,271 13,330 7,087 7,874 7,471 10,129 720 9,901 4,252 47,434 18,377 Depreciation 1,039 4,757 2,609 833 1,385 251 2,263 13,137 2,313 Total operating expenses 8,126 12,631 10,080 10,962 2,105 10,152 6,515 60,571 20,690 Operating income (loss) (6,662) (387) (131) 1,078 (387) (9,772) (2,333) (18,594) 1,948 Nonoperating Revenues (Expenses): Gain (loss) on disposal of capital assets 16 - (95) (6) (85) 306 Operating grants 3,016 - 45 18 9,691 332 13,102 11 Interest income 33 205 54 86 10 23 15 426 67 Interest expense - (128) - (128) Total nonoperating revenues (expenses) 3,065 205 (124) 98 10 9,714 347 13,315 384 Income (loss) before capital contributions and transfers (3,597) (182) (255) 1,176 (377) (58) (1,986) (5,279) 2,332 Capital contributions 77 1,580 965 - 1,388 267 4,277 86 Transfers in 4,177 474 906 631 1,016 100 7,304 1,247 Transfers out - (100) (7) (1,893) (3) (51) (16) (2,070) (111) Change in net position 657 1,772 1,609 (86) 2,024 (109) (1,635) 4,232 3,554 Net Position, Beginning 22,023 147,331 76,945 29,199 55,563 8,850 49,512 47,810 Net Position, Ending $ 22,680 $ 149,103 $78,554 $29,113 $ 57,587 $ 8,741 $ 47,877 $ 51,364 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Change in net position of business -type activities The notes to the financial statements are an integral part of this statement. 39 1,897 $ 6,129 City of Iowa City, Iowa Statement of Cash Flows Proprietary Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Governmental Business -type Activities - Enterprise Funds Activities - Other Intemal Wastewater Housing Enterprise Service Transit Treatment Water Sanitation Stormwater Authority Funds Total Funds Cash Flows From Operating Activities Receipts from customers and users $ 1,468 $ 12,098 $ 9,749 $ 11,962 $ 1,727 $ 641 $ 3,895 $ 41,540 $ 22,584 Payments to suppliers (2,535) (4,365) (3,628) (5,533) (368) (8,827) (2,815) (28,071) (15,739) Payments to employees (4,393) (3,348) (3,741) (3,736) (341) (998) (1,995) (18,552) (2,454) Net cash flows from (used for) operating activities (5,460) 4,385 2,380 2,693 1,018 (9,184) (915) (5,083) 4,391 Cash Flows From Noncapital Financing Activities Grants received 3,247 (6) 40 13 - 9,675 844 13,813 10 Transfers from other funds 4,177 3 3 631 264 - 100 5,178 1,247 Transfers to other funds (100) (7) (1,893) (3) (51) (16) (2,070) (111) Repayment/(payment) of notes receivable - - - 21 - 21 Advances to other funds - 174 174 Repayment of advances from other funds - - - 320 - - (275) 45 Net cash flows from (used for) noncapital financing activities 7,424 (103) 36 (929) 261 9,645 827 17,161 1,146 Cash Flows From Capital and Related Financing Activities Capital grants received 77 853 184 1,114 Acquisition and construction of property and equipment (997) (452) (14) (836) (2,089) (258) (4,646) (4,753) Proceeds from sale of property 16 6 1 - - 23 313 Principal paid on bonded debt (2,620) (1,629) - - - (4,249) Interest paid on bonded debt (321) (181) (502) Net cash flows from (used for) capital and related financing activities 93 (3,085) (2,256) (13) (836) (2,089) (74) (8,260) (4,440) Cash Flows From Investing Activities Interest on investments 48 309 79 165 17 47 25 690 275 Net increase (decrease) in cash and cash equivalents 2,105 1,506 239 1,916 460 (1,581) (137) 4,508 1,372 Cash and Cash Equivalents, Beginning 5,529 27,171 14,583 27,665 2,467 9,103 3,450 89,968 38,350 Cash and Cash Equivalents, Ending $ 7,634 $ 28,677 $14,822 $ 29,581 $ 2,927 $ 7,522 $ 3,313 $ 94,476 $ 39,722 Reconciliation of operating income (loss) to net cash flows from (used for) operating activities: Operatingincome(loss) $ (6,662) $ (387) $ (131) $ 1,078 $ (387) $ (9,772) $ (2,333) $(18,594) $ 1,948 Adjustments to reconcile operating income (loss) to net cash flows from (used for) operating activities: Depreciation expense 1,039 4,757 2,609 833 1,385 251 2,263 13,137 2,313 Changes in: Receivables: Accounts and unbilled usage 5 (159) (161) (133) 9 8 (285) (716) (33) Due from other governments (5) 13 (2) 55 - 1 (2) 60 (21) Inventories (17) 29 - - 12 (53) Accounts payable (137) 92 (26) 93 (2) 41 (551) (490) 5 Contracts payable 72 - - 72 Accrued liabilities 62 4 14 23 3 8 5 119 109 Employee vested benefits (1) 1 (9) 16 8 11 26 (7) Due to other governments 1 4 - 4 9 7 Unearned revenue - 155 155 Deposits 4 (37) - 97 64 Net pension liability 442 239 283 329 17 75 80 1,465 282 Deferred outflows of resources (83) (49) (51) (69) (6) (17) (24) (299) (48) Deferred inflows of resources (268) (166) (194) (184) (12) (63) (97) (984) (152) Other post employment benefits liability 89 40 55 62 3 17 29 295 41 Landfill closure/postclosure liability - - 586 586 - Total adjustments 1,202 4,772 2,511 1,615 1,405 588 1,418 13,511 2,443 Net cash flows from (used for) operating activities $ (5,460) $ 4,385 $ 2,380 $ 2,693 $ 1,018 $ (9,184) $ (915) $ (5,083) $ 4,391 Noncash Investing, Capital, and Financing Activities: Contributions of capital assets from government and others Capital grants not yet received Operating grants not yet received $ - $ 1,198 $ 1,868 $ - $ 2,140 $ - $ - $ 5,206 $ 93 $ - $ - $ - $ - $ - $ - $ 163 $ 163 $ - $ 2,233 $ 2 $ 7 $ 12 $ - $ 46 $ 251 $ 2,551 $ - The notes to the financial statements are an integral part of this statement. 40 City of Iowa City, Iowa Statement of Fiduciary Net Position Custodial Fund June 30, 2021 (amounts expressed in thousands) Project Green Assets Equity in pooled cash and investments $ 72 Total assets 72 Liabilities Accounts payable 9 Total liabilities 9 Net Position Restricted for an organization $ 63 The notes to the financial statements are an integral part of this statement. 41 City of Iowa City, Iowa Statement of Changes in Fiduciary Net Position Custodial Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Project Green Additions: Contributions $ 24 Total additions 24 Deductions: Services and charges Total deductions 41 41 Change in net position (17) Net Position, Beginning 80 Net Position, Ending $ 63 42 City of Iowa City, Iowa Notes to Financial Statements June 30, 2021 1. Accounting Policies The City of Iowa City, Iowa, (the City) was incorporated April 6, 1853, and operates under the Council/Manager form of government. The City provides a broad range of services to its citizens including general government, public safety, streets, parks, and cultural facilities. It also operates an airport, a mass transportation system, parking facilities, water treatment, wastewater treatment, storm water collection, sanitation collection and disposal (including landfill operations) and a housing authority. The financial statements of the City have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant accounting policies of the City are described below. The Reporting Entity For financial reporting purposes, the City includes all of its funds, organizations, agencies, boards, commissions, and authorities. The City has also considered all potential component units for which it is financially accountable, and other organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City's financial statements to be misleading or incomplete. The Governmental Accounting Standards Board has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization's governing body, and (1) the ability of the City to impose its will on that organization or (2) the potential for the organization to provide specific benefits to or impose specific financial burdens on the City. There were no component units required to be included. Government -Wide and Fund Financial Statements The government -wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report information on all of the non -fiduciary activities of the primary government. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent on fees and charges for support. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported as general revenues. As a general rule, the effect of inter -fund activity has been eliminated from the government -wide financial statements. Exceptions to this general rule are charges between the City's water and sewer function and various other functions of the government. Eliminations of these charges would distort the direct costs and program revenues reported for the various functions concerned. 43 Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. Description of Funds These financial statements include all funds owned or administered by the City or for which the City acts as custodian. The 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, deferred outflows of resources, liabilities, deferred inflows of resources, net position, revenues, and expenditures or expenses, as appropriate. The individual funds account for the governmental resources allocated to them for the purpose of carrying on specific activities in accordance with laws, regulations, or other restrictions. Basis of Accounting The accounting and financial reporting treatment applied to a fund is determined by its "measurement focus." The government -wide financial statements and proprietary funds are accounted for on the flow of economic resources measurement focus and use the accrual basis of accounting. Agency funds do not have a measurement focus and use the accrual basis of accounting. Under the accrual method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. All governmental funds are accounted for using a current financial resources measurement focus, which generally includes only current assets and current liabilities on the balance sheet. The modified accrual basis of accounting is used for these funds. Under the modified accrual basis, revenue is recognized when susceptible to accrual, which is in the period in which it becomes both available (collectible within the current period or soon thereafter to be used to pay liabilities of the current period) and measurable (the amount of the transaction can be determined). Revenue accrued includes property taxes, intergovernmental revenue, and interest earned on investments (if they are collected within 60 days after the year-end). Expenditures are recorded when the related fund liability is incurred. Principal and interest on long-term debt, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. The City reports the following major governmental funds: The General Fund is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Other Shared Revenue and Grants Fund is used to account for revenue from various sources, primarily road use tax monies from the State of Iowa and reimbursable programs funded by federal and state grants. The 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 Other Construction Fund accounts for the construction or replacement of other City general fixed assets, such as administrative buildings with various funding sources, including general obligation bonds, intergovernmental revenues, and contributions. The 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. 44 The Debt Service Fund accounts for the accumulation of resources for the payment of general long- term debt principal, interest, and related costs. The City reports the following major proprietary funds: The Transit Fund is used to account for the operation and maintenance of the public transportation system. 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 Stormwater Fund is used to account for the operation and maintenance of the stormwater utility system. The Housing Authority Fund is used to account for the operations and activities of the City's low and moderate income housing assistance and public housing programs. The City has two nonmajor enterprise funds, the Airport Fund is used to account for the operation and maintenance of the airport facility and the Parking Fund is used to account for the operation and maintenance of the "on" and "off" street public parking facilities. 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 a custodial fund account for monies held for Project Green, a local 501(c)(3) not-for- profit agency to which the City provides accounting and investing services. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City's enterprise funds and of the City's internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the government's policy to use restricted resources first, then unrestricted resources as they are needed. 45 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 other postemployment benefit obligation, net pension liability, landfill closure and post -closure care costs, total capacity of the landfill at closure, and calculation of the costs of claims incurred, but not reported. Cash and Investments The City maintains one primary demand deposit account through which the majority of its cash resources are processed. Substantially all investment activity is carried on by the City in an investment pool, except for those funds required to maintain their investments separately. The earnings on the pooled investments are allocated to the funds on a systematic basis. All investments are stated at fair value except for the Iowa Public Agency Investment Trust (IPAIT) which is valued at amortized cost pursuant to Rule 2a-7 under the Investment Company Act of 1940. For the purpose of the Statement of Cash Flows, restricted and non -restricted investments with a maturity of three months or less when purchased are considered cash equivalents. 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, it will not be recognized as revenue until the year for which it is levied. Federal and state grants are recorded as receivables and the revenue is recognized during the period in which the City fulfills the requirements for receiving the grant awards, as long as the susceptible to accrual criteria are met. Income from investments in all fund types and from charges for services in proprietary fund types is recognized when earned. Licenses and permits, fines and forfeitures, fees and refunds, charges for services (in governmental fund types), miscellaneous, and other revenues are recorded as revenue when received in cash because they are generally not measurable until actually received. Inventories Inventories are recognized only in those funds in which they are material to the extent of affecting operations. For the City, these are the Other Shared Revenue and Grants Fund, Transit Fund, Water Fund, and the Equipment Maintenance Fund. Inventories of materials and supplies are determined by actual count and priced on the FIFO method in the Other Shared Revenue and Grants Fund and the average cost method for the Transit, Water and Equipment Maintenance Fund. 46 Capital Assets Capital assets, which include property, buildings, equipment, and infrastructure assets (e.g., roads, bridges, water mains, and similar items), are reported in the applicable governmental or business -type activities columns in the government -wide financial statements. The City follows the policy of not requiring capitalization of an asset with an initial, individual cost of less than $50,000 for infrastructure, $25,000 for buildings and improvements, and $5,000 for equipment assets. Such assets are recorded at original purchase cost or at acquisition value at the date of donation when received as donated properties. Depreciation is computed using the straight-line method over the following estimated useful lives: Infrastructure 3 — 100 years Buildings and structures 20 — 50 years Improvements other than buildings 10 — 50 years Vehicles 2 — 20 years Other equipment 3 — 30 years Deferred Outflows of Resources Deferred outflows of resources represent a consumption of net position that applies to a future period(s) and will not be recognized as an outflow of resources (expense/expenditure) until then. Deferred outflows of resources consist of unrecognized items not yet charged to pension and OPEB expense and contributions from the employer after the measurement date but before the end of the employer's reporting period. Bond Premiums and Discounts Debt issued at a premium or discount is recorded net of the unamortized premium or discount. In the governmental funds, premiums and discounts are recorded entirely as other financing sources or uses in the year of issuance. In the proprietary funds and the government -wide statements, they are amortized over the life of the bonds. Compensated Absences Permanent City employees accumulate vacation and sick leave hours for subsequent use or for payment upon death, resignation, or retirement. The City pays its employees (except firefighters) one-half of the accumulated sick leave at the time of termination on the basis of the employee's then effective hourly base salary, provided that the dollar amount of the payment may be up to, but not exceed, the amount that an employee would be paid if the employee had terminated on June 28, 1985. Employees hired on or after June 29, 1985, are not eligible for payment of accumulated sick leave upon termination, death, or retirement. Pensions For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Iowa Public Employees' Retirement System and the Municipal Fire and Police Retirement System (Systems') and additions to/deductions from the Systems' fiduciary net position have been determined on the same basis as they are reported by the Systems. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Landfill Closing Costs Costs expected to be incurred in ultimately closing the present landfill site are being systematically provided for through charges to expense over the estimated useful life of the landfill on the basis of capacity used (see Note 7). 47 Deferred Inflows of Resources Deferred inflows of resources represent an acquisition of net position that applies to a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. Although certain revenues are measurable, they are not available. Available means collected within the current year or expected to be collected soon enough thereafter to be used to pay liabilities of the current year. Deferred inflows of resources in the governmental fund financial statements represent the amount of assets that have been recognized, but the related revenue has not been recognized since the assets are not collected within the current year or expected to be collected soon enough thereafter to be used to pay liabilities of the current year. Deferred inflows of resources consist of property tax receivable, grants receivable and other receivables. Deferred inflows of resources in the Statement of Net Position consist of succeeding year property tax receivable that will not be recognized as revenue until the year for which they are levied, the difference in the carrying value of refunded debt and it's acquisition price and the unamortized portion of pension and OPEB related items. Budgetary and Legal Appropriation and Amendment Policies The City prepares and adopts an annual function budget, as prescribed by Iowa statutes, for all funds except internal service and agency funds. This is formalized in a separate budgetary report, the Financial Plan. This budget is adopted on or before March 15 of each year to become effective July 1 and constitutes the City's appropriation for each program and purpose specified therein until amended. The adopted budget must include the following: a. Expenditures for each function: Public safety Public works Health and social services Culture and recreation Community and economic development General government Debt service Capital projects Business-type/enterprise b. The amount to be raised by property taxation c. Income from sources other than property taxation d. Transfers in and transfers out The legal level of control (the level at which expenditures may not legally exceed appropriations) is the function level for all funds combined, rather than at the individual fund level. Management can transfer appropriations within a function, within a fund type, and between fund types, without the approval of the governing body so long as the total budget by function area will not be exceeded. It is necessary, therefore, to aggregate the expenditures of the budgeted activities within the governmental fund types with the expenditures of the budgeted activities within the enterprise funds on a function basis, and to compare such function totals to function budgeted totals in order to demonstrate legal compliance with the budget. The City's budget for revenue focuses on aggregated totals by revenue source. 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. 48 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 functions. A budget amendment must be prepared and adopted in the same manner as the original budget. The City's budget was amended as prescribed, and the effects of those amendments are shown in the accompanying budgetary comparison schedule. The original budget was increased by $10,860,737 in revenues and other financing sources and by $50,013,902 in expenditures and other financing uses. Appropriations, as adopted or amended, lapse at the end of the fiscal year. As allowed by GASB Statement No. 41, Budgetary Comparison Schedules — Perspective Differences, the City presents budgetary comparison schedules as required supplementary information based on the program structure of nine functional areas as required by state statute for its legally adopted budget. Restricted Assets Assets within the individual funds, which can be designated by the City Council for any use within the fund's purpose, are considered to be unrestricted assets. Assets, which are restricted for specific uses by bonded debt requirements, grant provisions, or other requirements, are classified as restricted assets. Liabilities, which are payable from restricted assets, are classified as such. Classification of Fund Balances Fund balances for the governmental funds are reported in classifications based on the nature of any limitations requiring the use of resources for specific purposes (see Note 8). 2. Cash and Pooled Investments The City's deposits in banks at June 30, 2021 were entirely covered or collateralized by federal depository insurance, national credit union administration, letters of credit held by the City or by the State Sinking Fund in accordance with Chapter 12C of the Code of Iowa. This chapter provides for additional assessments against the depositories to insure there will be no loss of public funds. The City is authorized by statute to invest public funds in obligations of the United States government, its agencies and instrumentalities; certificates of deposit or other evidences of deposit at federally insured Iowa depository institutions approved by City Council and secured pursuant to the limitations set forth in Chapter 12C of the Code of Iowa; prime eligible bankers acceptances; certain high rated commercial paper or other short-term corporate debt; perfected repurchase agreements; Iowa Public Agency Investment Trust (IPAIT); certain registered open—end management investment companies registered with the Securities & Exchange Commission under the federal Investment Company Act of 1940; and warrants or improvement certificates of a drainage district. 49 At June 30, 2021 the City of Iowa City had the following investments: Fair Investment Value Federal Home Loan Mortgage Corporation Notes Federal Farm Credit Bank Notes Federal National Mortgage Association Federal Home Loan Bank Credit Agricole CIB NY Natixis NY Branch $ 6,182,529 3,860,844 6,528,346 13,836,447 4,994,789 4,994,479 $ 40,397,434 Maturities July 2023 to February 2025 December 2024 to September 2040 July 2023 to June 2029 September 2025 to January 2027 January 2022 December 2021 The City uses the fair value hierarchy established by generally accepted accounting principles based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets. Level 2 inputs are significant other observable inputs. Level 3 inputs are significant unobservable inputs. The recurring fair value measurement for the Federal Home Loan Mortgage Corporation securities of $6,182,529, the Federal Farm Credit Bank Note securities of $3,860,844, the Federal National Mortgage Association securities of $6,258,346 and the Federal Home Loan Bank securities of $13,836,447 were determined using the last reported sales price at current exchange rates (Level 1 inputs). The fair value measurement for the Credit Agricole CIB NY Corporation commercial paper of $4,994,789 and the Natixis NY Branch commercial paper of $4,994,479 was determined using the last reported sales price at current exchange rates (Level 1 inputs). The City had no other investments meeting the disclosure requirements of Governmental Accounting Standards Board Statement No. 72. In addition, the City had investments in the Iowa Public Agency Investment Trust (IPAIT), which are valued at an amortized cost of $79,188, which approximates fair value. The Diversified Portfolio consists of cash and short-term investments valued at amortized cost, which approximates fair value, pursuant to Governmental Accounting Standards Board Statement No. 79. The Iowa Public Agency Investment Trust (IPAIT) represents an investment in a pool managed by others. IPAIT is a common trust established under Iowa law pursuant to Iowa Code Chapter 28E in 1987 to enable eligible Iowa public agencies to safely and effectively invest their available operating and reserve funds. IPAIT is registered under the Investment Company Act of 1940. The IPAIT portfolios have followed established money market mutual fund investment parameters designed to maintain a $1 per unit net asset value since inception and were registered with the Securities and Exchange Commission (SEC). Interest rate risk - The City's investment policy limits the investment of operating funds to investments that mature within 397 days. The portion of operating funds in excess of 33% of operating funds may be invested in certificates of deposit which mature within 63 months or less. Funds not identified as operating funds may be invested in instruments with maturities longer than 397 days. Credit risk. State law limits investments to commercial paper and corporate bonds to the top two ratings issued by nationally recognized statistical rating organizations. It is the City's policy to comply with rating restrictions. The investment in Iowa Public Agency Investment Trust is not rated by Moody's Investors service as it is a state security that is backed by the full faith and credit of the issuing government and is not subject to credit risk. Concentration of credit risk. The City investment policy limits the amount that may be invested in any one issuer to a maximum amount approved by the City Council. 50 Due to legal and budgetary reasons, the General Fund is assigned a portion of the investment earnings associated with other funds. These funds are the Employee Benefits, Other Shared Revenue and Grants, and Sanitation funds. 3. Interfund Balances and Transfers Interfund balances for the year ended June 30, 2021, consisted of the following: Due from General Due to: Nonmajor Enterprise $ 174,380 Interfund balances at June 30, 2021, include due to/from other funds, which represent amounts for negative cash balance funding. The $174,380 advance to the Nonmajor Enterprise Funds is expected to be repaid within the next year. Advances from Debt Service Sanitation Total Advances to: Other Shared Revenue and Grants $ 66,731 $ $ 66,731 Other Construction - 3,186,669 3,186,669 Nonmajor Enterprise 1,037,525 1,037,525 Total $ 66,731 $ 4,224,194 $ 4,290,925 Interfund balances at June 30, 2021, include advances to/from other funds, which represent amounts for construction loans and a revenue bond redemption loan. $50,930 of the $66,731 advance to the Other Shared Revenue and Grants Fund is not expected to be repaid within the next year. $3,000,266 of the $3,186,669 advance to the Other Construction Fund is not expected to be repaid within the next year. $762,064 of the $1,037,525 advance to the Nonmajor Enterprise Funds is not expected to be repaid within the next year. 51 Interfund transfers for the year ended June 30, 2021, consisted of the following: Transfer from Capital Projects Bridge, Street Other Capital Projects and Traffic Shared Revenue Employee Other Control Debt Nonmajor General and Grants Benefits Construction Construction Service Governmental Transfer to: General $ $ 86,622 $ 12,340,630 $ $ $ $ 88,916 Other Shared Revenue and Grants 1,000,000 622,374 Debt Service 15,484 - 1,010,208 Capital Projects Other Construction 1,280,459 186,588 150,507 Capital Projects Bridge, Street and Traffic Control Construction 398,084 2,447,432 Nonmajor Governmental 109,843 320,450 - Transit 4,076,795 - Wastewater Treatment 3,597 - - - 470,687 Water 3,121 - - 903,368 Sanitation 10,539 - - - 620,000 Stormwater 1,986 261,816 - 744,711 Nonmajor Enterprise 100,000 Internal Service 141,427 134,699 - 21,537 40,449 Total Transfer to $ 7,141,335 $ 3,437,607 $ 12,963,004 $ 21,537 $ 2,159,215 $ 620,000 $ 1,249,631 Transfers are used to move revenues and bond proceeds from the fund that State statutes or the budget requires to collect them to the fund that the State statutes or the budget requires to expend them. In the fund financial statements, total transfers in and transfers out of $29,774,091 are less than total transfers of $30,148,888 because of the treatment of transfers of capital assets from the governmental activities capital assets. 52 Transfer from Wastewater Housing Nonmajor Internal Total Treatment Water Sanitation Stormwater Authority Enterprise Service Transfer from $ $ $ - $ $ 50,720 $ $ $ 12,566,888 - - - - 1,622,374 1,025,692 100,000 - - - 10,978 1,728,532 - 1,000,000 3,419 - - 3,848,935 - - - 430,293 100,000 4,176,795 - - - 474,284 - - - - 906,489 630,539 7,216 - - - - 1,015,729 - - - - 100,000 893,181 - - 16,248 - 1,247,541 $ 100,000 $ 7,216 $ 1,893,181 $ 3,419 $ 50,720 $ 16,248 S 110,978 29,774,091 Transfers from governmental activities capital assets to enterprise funds 289,284 Transfers from governmental activities capital assets to an internal service fund 85,513 $ 30,148,888 During the year, construction in progress related to construction for the Myrtle and Riverside Dr Intersection with values of $131,615 and $157,669 were transferred from governmental activities capital asset to Water and Stormwater, respectively. No amounts were reported in the governmental funds, as the amounts did not involve the transfer of financial resources. However, Water and Stormwater did report capital contributions for the capital resources received. During the year, two capital assets related to public works with values of $62,750 and $22,763 were transferred from governmental activities capital asset to Equipment. No amounts were reported in the governmental funds, as the amounts did not involve the transfer of financial resources. However, Equipment did report capital contributions for the capital resources received. 53 4. Capital Assets Capital asset activity for the year ended June 30, 2021, was as follows: Acquisitions Disposals Beginning and and Balance July 1, 2020 Transfers Transfers June 30, 2021 Governmental activities: Capital assets, not being depreciated: Land $ 31,159,095 $ 1,662,010 $ - $ 32,821,105 Construction in progress 10,000,526 3,352,607 8,120,285 5,232,848 Total capital assets, not being depreciated 41,159,621 5,014,617 8,120,285 38,053,953 Capital assets, being depreciated: Buildings 66,943,523 1,284,234 93,782 68,133,975 Improvements other than buildings 7,849,511 207,899 30,694 8,026,716 Machinery and equipment 59,689,068 7,963,065 4,964,130 62,688,003 Infrastructure 214,745,245 9,207,724 - 223,952,969 Total capital assets being depreciated 349,227,347 18,662,922 5,088,606 362,801,663 Less accumulated depreciation for: Buildings 29,476,077 1,704,734 76,604 31,104,207 Improvements other than buildings 4,281,517 272,060 6,808 4,546,769 Machinery and equipment 28,631,978 4,247,749 4,866,621 28,013,106 Infrastructure 54,120,348 4,455,479 - 58,575,827 Total accumulated depreciation 116,509,920 10,680,022 4,950,033 122,239,909 Total capital assets, being depreciated, net 232,717,427 7,982,900 138,573 240,561,754 Governmental activities capital assets, net $ 273,877,048 $ 12,997,517 $ 8,258,858 $ 278,615,707 Business -type activities: Capital assets, not being depreciated: Land $ 30,317,185 $ - $ - $ 30,317,185 Construction in progress 4,107,478 2,129,834 3,162,612 3,074,700 Total capital assets, not being depreciated 34,424,663 2,129,834 3,162,612 33,391,885 Capital assets, being depreciated: Buildings 134,120,224 2,089,182 - 136,209,406 Improvements other than buildings 11,321,421 540,545 72,331 11,789,635 Machinery and equipment 43,347,727 266,659 4,183,283 39,431,103 Infrastructure 334,375,406 8,197,939 645,660 341,927,685 Total capital assets being depreciated 523,164,778 11,094,325 4,901,274 529,357,829 Less accumulated depreciation for: Buildings 71,040,572 3,553,462 - 74,594,034 Improvements other than buildings 7,687,071 410,689 62,897 8,034,863 Machinery and equipment 27,046,558 1,795,260 4,194,863 24,646,955 Infrastructure 120,365,287 7,377,055 529,193 127,213,149 Total accumulated depreciation 226,139,488 13,136,466 4,786,953 234,489,001 Total capital assets, being depreciated, net 297,025,290 (2,042,141) 114,321 294,868,828 Business -type activities capital assets, net $ 331,449,953 $ 87,693 $ 3,276,933 $ 328,260,713 54 Depreciation expense was charged to functions as follows: Governmental activities: Public safety Public works Culture and recreation Community and economic development General government Total depreciation expense - governmental activities Business -type activities: Transit Wastewater treatment Water Sanitation Stormwater Housing authority Nonmajor enterprise Total depreciation expense - business -type activities 5. Long Term Debt Changes in Debt for Bonds Bond debt activity for the year ended June 30, 2021, was as follows: Governmental activities: 1,563,465 5,464,962 3,199,646 51,878 399,727 $ 10,679,678 1,038,403 4,756,785 2,608,978 832,719 1,385,449 250,803 2,263,329 $ 13,136,466 Due Within July 1, 2020 Issues Retirements June 30, 2021 One Year General obligation bonds $ 53,370,000 $ 11,325,000 $ 10,760,000 $ 53,935,000 $ 10,255,000 Plus: Unamortized Premium 1,637,945 1,463,546 350,998 2,750,493 318,034 Total general obligation bonds 55,007,945 12,788,546 11,110,998 56,685,493 10,573,034 Revenue bonds Less: Unamortized Discounts Total revenue bonds Business -type activities: Revenue bonds Plus: Unamortized Premium 14,790,000 1,985,000 12,805,000 965,000 25,488 - 2,124 23,364 2,124 14,764,512 1,982,876 12,781,636 962,876 $ 69,772,457 $ 12,788,546 $ 13,093,874 $ 69,467,129 $ 11,535,910 $ 16,065,000 $ - $ 4,250,000 $ 11,815,000 $ 4,350,000 721,358 - 294,352 427,006 246,801 Total revenue bonds $ 16,786,358 $ $ 4,544,352 $ 12,242,006 $ 4,596,801 55 General Obligation Bonds Various issues of general obligation bonds totaling $53,935,000 are outstanding as of June 30, 2021. The bonds have interest rates ranging from 1.00% to 5.00% and mature in varying annual amounts ranging from $805,000 to $1,800,000 per issue, with the final maturities due in the year ending June 30, 2031. 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. Annual debt service requirements to maturity for general obligation bonds are as follows: Fiscal Year Ending Governmental Activities June 30 Principal Interest 2022 2023 2024 2025 2026 2027-2031 $ 10,255,000 8,810,000 7,685,000 6,630,000 5,860,000 14,695,000 $ 1,572,113 1,267,612 997,963 771,962 569,900 828,325 Total $ 53,935,000 $ 6,007,875 Revenue Bonds As of June 30, 2021, the following unmatured revenue bond issues are outstanding: Original issue amount Interest rates Annual maturities Amount outstanding Wastewater Treatment Water Taxable Urban Renewal $ 13,910,000 $ 14,510,000 $ 12,805,000 2.0% to 5.0% 1.5% to 5.0% 1.0% to 3.9% $ 835,000 to $ 465,000 to $ 725,000 to $ 2,085,000 $ 1,225,000 $ 965,000 $ 4,745,000 $ 7,070,000 $ 12,805,000 Revenue bond debt service requirements to maturity are as follows: Fiscal Year Ending June 30 2022 2023 2024 2025 2026 2027-2031 2032-2036 Governmental Activities Principal Interest $ 965,000 $ 960,000 955,000 950,000 950,000 3,820,000 4,205,000 384,150 355,200 326,400 297,750 269,250 972,450 385,650 Business -type Activities Principal Interest $ 4,350,000 3,840,000 1,745,000 1,325,000 555,000 $ 298,690 149,270 55,825 26,081 6,244 Total $ 12,805,000 $ 2,990,850 $ 11,815,000 $ 536,110 56 The revenue bond ordinances required that wastewater treatment, water revenues, and urban renewal tax revenues be set aside into separate and special accounts as they are received. The use and the amounts to be included in the accounts are as follows: Account (a) Revenue Bond and Interest Sinking Reserve (b) Revenue Debt Service Reserve (c) Improvement Reserve Amount Amount sufficient to pay current bond and interest maturities. Amount required to be deposited in the Revenue Bond and Interest Reserve until the reserve fund equals: Taxable Urban Renewal Revenue bonds — maximum debt service due on the bonds in any succeeding fiscal year. Wastewater Revenue and Water Revenue bonds — 10% of the original principal amounts of all related bond issues. $20,000 per month until the reserve balance equals or exceeds $2,000,000 for Wastewater Revenue bonds and $5,000 per month until the reserve balance equals or exceeds $450,000 for Water Revenue bonds, with no further deposits once the minimum balance is reached. If the reserve falls below the required minimum, monthly transfers in the aforementioned amounts will resume. In fiscal year ended June 30, 2021, the Wastewater Treatment Fund had net revenue of $4,575,000 and the amount of principal and interest due was $2,877,000. In fiscal year ended June 30, 2021, the Water Fund had net revenues of $2,577,000 and the amount of principal and interest due was $1,823,000. 57 Summary of Bond Issues General obligation and revenue bonds payable at June 30, 2021, are comprised of the following issues: General Obligation Bonds: Multi -Purpose Multi -Purpose Refunded Multi -Purpose (1) Multi -Purpose Multi -Purpose Multi -Purpose Multi -Purpose Multi -Purpose Multi -Purpose Multi -Purpose Total General Obligation Bonds Date of Issue June 2012 July 2013 June 2014 June 2015 June 2016 June 2017 June 2018 June 2019 June 2020 June 2021 Date of Issue Amount Interest Final Issued Rates Maturity 9,070,000 2.0 - 2.25 6/22 7,230,000 1.0 - 2.0 6/23 11,980,000 2.0 - 3.0 6/24 7,785,000 2.0 - 2.25 6/25 8,795,000 2.0 - 3.0 6/26 9,765,000 2.0 - 2.5 6/27 8,895,000 1.8 - 2.65 6/28 12,535,000 2.0 - 2.25 6/29 12,145,000 2.0 - 5.0 6/30 11,325,000 2.0 - 5.0 6/31 Amount Issued Interest Rates Revenue Bonds: Refunded Wastewater Treatment Bonds (2) June 2016 9,360,000 3.0 - 4.0 Refunded Wastewater Treatment Bonds (3) June 2017 Refunded Water Bonds (4) June 2012 Refunded Water Bonds (5) June 2016 Refunded Water Bonds (6) June 2017 Taxable Urban Renewal Sept. 2016 Total Revenue Bonds (1) (2) (3) (4) (5) (6) 4,550,000 2.0 - 5.0 4,950,000 1.5 - 2.1 3,650,000 1.5 - 5.0 5,910,000 2.0 - 2.25 12,805,000 3.0 Final Maturity 7/21 7/22 7/22 7/24 7/25 6/36 Outstanding June 30, 2021 1,005,000 1,725,000 3,000,000 3,365,000 4,945,000 6,100,000 6,420,000 7,505,000 8,545,000 11,325,000 $ 53,935,000 Outstanding June 30, 2021 1,825,000 2,920,000 1,070,000 2,000,000 4,000,000 12,805,000 $ 24,620,000 $ 78,555,000 This bond issue is an advance refunding of portions of the September 2006 and May 2007 General Obligation Bonds. This bond issue refunded the October 2008 Wastewater Revenue Bond. This bond issue refunded the May 2009 Wastewater Revenue Bonds. This bond issue refunded the October 2002 Water Revenue Bonds. This bond issue refunded the October 2008 Water Revenue Bonds. This bond issued refunded the May 2009 Water Revenue Bonds. 58 Conduit Debt Obligations From time to time, the City has issued Industrial Development Revenue Bonds and Midwestern Disaster Area Revenue Bonds to provide financial assistance to private sector entities for the acquisition, construction, and renovation of industrial and commercial facilities deemed to be in the public interest. The bonds are collateralized by the property financed and are payable solely from payments received on the underlying mortgage loans. All payments on the bonds are made by the private sector entities directly to a bond trustee, who is a third party financial institution, and in turn, disburses the payment to the respective bond holders. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of June 30, 2021, there were three series of Industrial Development Revenue Bonds outstanding, with an aggregate principal amount payable of $26,347,719. Debt Legal Compliance Legal Debt Margin: As of June 30, 2021, the general obligation debt issued by the City did not exceed its legal debt limit computed as follows (amounts expressed in thousands): Assessed valuation: Real property $ 6,739,315 Utilities 118,583 Total valuation $ 6,857,898 Debt limit, 5% of total assessed valuation $ 342,895 Debt applicable to debt limit: General obligation bonds 53,935 Urban renewal revenue bonds 12,805 Notes payable (Note 7) 211 Other legal indebtedness (TIF rebates)(Note 10) 36,944 Total net debt applicable to limit 103,895 Legal debt margin $ 239,000 6. Pension and Retirement Systems The City contributes to two employee retirement systems, the Municipal Fire and Police Retirement System of Iowa (MFPRSI) and the Iowa Public Employees Retirement System (IPERS). MFPRSI is governed by a nine -member Board of Trustees. Though separate and apart from state government, the Board is authorized by the state legislature, which also establishes by statute the pension and disability benefits and the System's funding mechanism. IPERS is administered by the State of Iowa. All full-time employees must participate in either MFPRSI or IPERS. As of June 30, 2021, the City had the following balances related to its pension accounts: IPERS MFPRSI Total Net Pension Liability $ 27,731,863 $ 28,881,737 $ 56,613,600 Deferred Inflows 950,405 622,414 1,572,819 Deferred Outflows 6,111,076 8,789,893 14,900,969 Pension Expense 4,199,046 5,238,342 9,437,388 For the governmental activities, net pension liability is generally liquidated by the General Fund, Community Development Block Grant Fund and Other Shared Revenue and Grants Fund 59 Municipal Fire and Police Retirement System of Iowa (MFPRSI) Plan Description MFPRSI membership is mandatory for fire fighters and police officers covered by the provisions of Chapter 411 of the Code of Iowa. Employees of the City are provided with pensions through a cost-sharing multiple employer defined benefit pension plan administered by MFPRSI. MFPRSI issues a stand-alone financial report which is available to the public by mail at 7155 Lake Drive, Suite #201, West Des Moines, Iowa 50266 or at www.mfprsi.org. MFPRSI benefits are established under Chapter 411 of the Code of Iowa and the administrative rules thereunder. Chapter 411 of the Code of Iowa and the administrative rules are the official plan documents. The following brief description is provided for general informational purposes only. Refer to the plan documents for more information. Pension Benefits Members with 4 or more years of service are entitled to pension benefits beginning at age 55. Full service retirement benefits are granted to members with 22 years of service, while partial benefits are available to those members with 4 to 22 years of service based on the ratio of years completed to years required (i.e., 22 years). Members with less than 4 years of service are entitled to a refund of their contribution only, with interest, for the period of employment. Benefits are calculated based upon the member's highest 3 years of compensation. The average of these 3 years becomes the member's average final compensation. The base benefit is 66 percent of the member's average final compensation. Additional benefits are available to members who perform more than 22 years of service (2 percent for each additional year of service, up to a maximum of 8 years). Survivor benefits are available to the beneficiary of a retired member according to the provisions of the benefit option chosen plus an additional benefit for each child. Survivor benefits are subject to a minimum benefit for those members who chose the basic benefit with a 50 percent surviving spouse benefit. Active members, at least 55 years of age, with 22 or more years of service have the option to participate in the Deferred Retirement Option Program (DROP). The DROP is an arrangement whereby a member who is otherwise eligible to retire and commence benefits opts to continue to work. A member can elect a 3, 4, or 5 year DROP period. By electing to participate in DROP the member is signing a contract indicating the member will retire at the end of the selected DROP period. During the DROP period the member's retirement benefit is frozen and a DROP benefit is credited to a DROP account established for the member. Assuming the member completes the DROP period, the DROP benefit is equal to 52% of the member's retirement benefit at the member's earliest date eligible and 100% if the member delays enrollment for 24 months. At the member's actual date of retirement, the member's DROP account will be distributed to the member in the form of a lump sum or rollover to an eligible plan. Disability and Death Benefits Disability coverage is broken down into two types, accidental and ordinary. Accidental disability is defined as permanent disability incurred in the line of duty, with benefits equivalent to the greater of 60 percent of the member's average final compensation or the member's service retirement benefit calculation amount. Ordinary disability occurs outside the call of duty and pays benefits equivalent to the greater of 50 percent of the member's average final compensation, for those with 5 or more years of service, or the member's service retirement benefit calculation amount, and 25 percent of average final compensation for those with less than 5 years of service. Death benefits are similar to disability benefits. Benefits for accidental death are 50 percent of the average final compensation of the member plus an additional amount for each child, or the provisions for ordinary death. Ordinary death benefits consist of a pension equal to 40 percent of the average final compensation of the member plus an additional amount for each child, or a lump -sum distribution to the designated beneficiary equal to 50 percent of the previous year's earnable compensation of the member or equal to the amount of the member's total contributions plus interest. 60 Benefits are increased annually in accordance with Chapter 411.6 of the Code of Iowa which states a standard formula for the increases. The surviving spouse or dependents of an active member who dies due to a traumatic personal injury incurred in the line of duty receives a $100,000 lump -sum payment. Contributions Member contribution rates are set by state statute. In accordance with Chapter 411 of the Code of Iowa, the contribution rate was 9.40% of earnable compensation for the year ended June 30, 2021. Employer contribution rates are based upon an actuarially determined normal contribution rate and set by state statute. The required actuarially determined contributions are calculated on the basis of the entry age normal method as adopted by the Board of Trustees as permitted under Chapter 411 of the Code of Iowa. The normal contribution rate is provided by state statute to be the actuarial liabilities of the plan less current plan assets, with such total divided by 1 percent of the actuarially determined present value of prospective future compensation of all members, further reduced by member contributions and state appropriations. Under the Code of Iowa the employer's contribution rate cannot be less than 17.00% of earnable compensation. The contribution rate was 25.31% for the year ended June 30, 2021 The City's contributions to MFPRSI for the year ended June 30, 2021 was $2,902,637. If approved by the state legislature, state appropriation may further reduce the employer's contribution rate, but not below the minimum statutory contribution rate of 17.00% of earnable compensation. The State of Iowa therefore is considered to be a nonemployer contributing entity in accordance with the provisions of the Governmental Accounting Standards Board Statement No. 67 — Financial Reporting for Pension Plans, (GASB 67). There were no state appropriations to MFPRSI during the fiscal year ended June 30, 2021. Net Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2021, the City reported a liability of $28,881,737 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2020, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City's proportion of the net pension liability was based on the City's share of contributions to the pension plan relative to the contributions of all MFPRSI participating employers. At June 30, 2020, the City's proportion was 3.621079% which was a decrease of 0.063801% from its proportions measured as of June 30, 2019. 61 For the year ended June 30, 2021, the City recognized pension expense of $5,238,342. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows of Deferred Inflows of Resources Resources Differences between expected and actual experience $ 794,090 $ 156,887 Change of assumptions 715,434 34,458 Net difference between projected and actual earnings on pension plan investments 4,248,846 Changes in proportion and differences between City contributions and proportionate share of contributions 128,886 431,069 City contributions subsequent to the measurement date 2,902,637 Total $ 8,789,893 $ 622,414 $2,902,637 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended Total June 30, 2022 $ 1,148,605 June 30, 2023 1,656,381 June 30, 2024 1,475,701 June 30, 2025 985,099 June 30, 2026 (944) $ 5,264,842 Actuarial Assumptions The total pension liability in the June 30, 2020, actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement: Rate of inflation Salary increases Investment rate of return 3.00 percent per annum 3.75 to 15.11 percent, including inflation 7.50 percent, net of pension plan investment expense, including inflation 62 The actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the period from July 1, 2007 to June 30, 2017. Postretirement mortality rates were based on the RP -2014 Blue Collar Combined Healthy Annuitant Table with males set -forward zero years, females set -forward two years and disabled individuals set -forward three years (male only rates), with generational projection of future mortality improvement with 50 percent of Scale BB beginning in 2017. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best -estimate ranges of expected future real rates (i.e., expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The best estimates of geometric real rates of return for each major asset class are summarized in the following table: Long -Term Expected Asset Class Real Rate of Return Core Plus Fixed Income Emerging Markets Large Cap Small Cap Global infrastructure International Large Cap Private Credit Private Equity Private Non -Core Real Estate Private Core Real Estate 4.0 % 7.9 7.49 8.1 7.5 7.2 6.4 10.8 11.5 7.2 Discount Rate The discount rate used to measure the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and the City contributions will be made at rates equal to the difference between actuarially determined rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of City's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the City's proportionate share of the net pension liability calculated using the discount rate of 7.5%, as well as what the city's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.5%) or 1% higher (8.5%) than the current rate. 1% Decrease (6.5%) Discount Rate (7.5%) 1% Increase (8.5%) City's proportionate share of the net pension liability: $ 44,298,964 $ 28,881,737 $ 16,111,373 63 Pension Plan Fiduciary Net Position Detailed information about the pension plan's fiduciary net position is available in the separately issued MFPRSI financial report which is available on MFPRSI's website at www.mfprsi.org. Payables to the Pension Plan At June 30, 2021, there were no amounts due to MFPRSI. Iowa Public Employees Retirement System (IPERS) Plan Description IPERS membership is mandatory for employees of the City, except for those covered by another retirement system. Employees of the City are provided with pensions through a cost-sharing multiple employer defined benefit pension plan administered by IPERS. IPERS issues a stand-alone financial report which is available to the public by mail at 7401 Register Drive P.O. Box 9117, Des Moines, Iowa 50306-9117 or at www.ipers.org. IPERS benefits are established under Iowa Code chapter 97B and the administrative rules thereunder. Chapter 97B and the administrative rules are the official plan documents. The following brief description is provided for general informational purposes only. Refer to the plan documents for more information. Pension Benefits A regular member may retire at normal retirement age and receive monthly benefits without an early- retirement reduction. Normal retirement age is age 65, any time after reaching age 62 with 20 or more years of covered employment, or when the member's years of service plus the member's age at the last birthday equals or exceeds 88, whichever comes first. (These qualifications must be met on the member's first month of entitlement to benefits.) Members cannot begin receiving retirement benefits before age 55. The formula used to calculate a Regular member's monthly IPERS benefit includes: • A multiplier (based on years of service). • The member's highest five-year average salary. (For members with service before June 30, 2012, the highest three-year average salary as of that date will be used if it is greater than the highest five- year average salary.) If a member retires before normal retirement age, the member's monthly retirement benefit will be permanently reduced by an early-retirement reduction. The early-retirement reduction is calculated differently for service earned before and after July 1, 2012. For service earned before July 1, 2012, the reduction is 0.25 percent for each month that the member receives benefits before the member's earliest normal retirement age. For service earned starting July 1, 2012, the reduction is 0.50 percent for each month that the member receives benefits before age 65. Generally, once a member selects a benefit option, a monthly benefit is calculated and remains the same for the rest of the member's lifetime. However, to combat the effects of inflation, retirees who began receiving benefits prior to July 1990 receive a guaranteed dividend with their regular November benefit payments. Disability and Death Benefits A vested member who is awarded federal Social Security disability or Railroad Retirement disability benefits is eligible to claim IPERS benefits regardless of age. Disability benefits are not reduced for early retirement. If a member dies before retirement, the member's beneficiary will receive a lifetime annuity or a lump -sum payment equal to the present actuarial value of the member's accrued benefit or calculated with a set formula, whichever is greater. When a member dies after retirement, death benefits depend on the benefit option the member selected at retirement. 64 Contributions Contribution rates are established by IPERS following the annual actuarial valuation, which applies IPERS' Contribution Rate Funding Policy and Actuarial Amortization Method. Statute limits the amount rates can increase or decrease each year to 1 percentage point. IPERS Contribution Rate Funding Policy requires that the actuarial contribution rate be determined using the "entry age normal" actuarial cost method and the actuarial assumptions and methods approved by the IPERS Investment Board. The actuarial contribution rate covers normal cost plus the unfunded actuarial liability payment based on a 30 -year amortization period. The payment to amortize the unfunded actuarial liability is determined as a level percentage of payroll, based on the Actuarial Amortization Method adopted by the Investment Board. In fiscal year 2021, pursuant to the required rate, Regular members contributed 6.29% of pay and the City contributed 9.44% for a total rate of 15.73%. The City's total contributions to IPERS for the year ended June 30, 2021 were $3,025,270. Net Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2021, the City reported a liability of $27,731,863 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2020, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City's proportion of the net pension liability was based on the City's share of contributions to the pension plan relative to the contributions of all IPERS participating employers. At June 30, 2020, the City's proportion was 0.3947745% which was a decrease of 0.010614% from its proportions measured as of June 30, 2019. For the year ended June 30, 2021, the City recognized pension expense of $4,199,046. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows of Deferred Inflows of Resources Resources Differences between expected and actual experience $ 30,636 $ 657,316 Change of assumptions 1,423,467 Net difference between projected and actual earnings on pension plan investments 1,558,971 Changes in proportion and differences between City contributions and proportionate share of contributions 72,732 293,089 City contributions subsequent to the measurement date 3,025,270 Total $ 6,111,076 $ 950,405 65 $3,025,270 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended Total June 30, 2022 $ 314,139 June 30, 2023 527,456 June 30, 2024 487,645 June 30, 2025 842,550 June 30, 2026 (36,389) $ 2,135,401 Actuarial Assumptions The total pension liability in the June 30, 2020, actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement: Rate of inflation (effective June 30, 2017) Salary increases (effective June 30, 2017) Investment rate of return (effective June 30, 2017) Wage growth (effective June 30, 2017) 2.60% per annum 3.25 to 16.25%, average, including inflation. Rates vary by membership group. 7.00% compounded annually, net of pension plan investment expense, including inflation 3.25% per annum based on 2.60% inflation and 0.65% real wage inflation The actuarial assumptions used in the June 30, 2020 valuation were based on the results of economic assumption study dated March 24, 2017 and a demographic assumption study dated June 28, 2018. Mortality rates were based on the RP -2014 Employee and Healthy Annuitant Tables with MP -2017 generational adjustments. 66 The long-term expected rate of return on pension plan investments was determined using a building-block method in which best -estimate ranges of expected future real rates (i.e., expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Asset Class Long -Term Expected Target Allocation Real Rate of Return Core Plus Fixed Income 28.0 % (0.29) % Domestic Equity 22.0 4.43 International Equity 17.5 5.15 Private Equity 11.0 6.54 Private Real Assets 7.5 4.48 Global Smart Beta Equity 6.0 4.87 Public Credit 4.0 2.29 Private Credit 3.0 3.11 Cash 1.0 (0.78) Total 100.0 % Discount Rate The discount rate used to measure the total pension liability was 7.0%. The projection of cash flows used to determine the discount rate assumed employee contributions will be made at the contractually required rate and that the contributions from the City will be made at contractually required rates, actuarially determined. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments to current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of City's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the City's proportionate share of the net pension liability calculated using the discount rate of 7.0%, as well as what the city's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.0%) or 1% higher (8.0%) than the current rate. 1% Decrease Discount Rate 1% Increase (6.0%) (7.0%) (8.0%) City's proportionate share of the net pension liability: $ 46,240,541 $ 27,731,863 $ 12,212,619 Pension Plan Fiduciary Net Position Detailed information about the pension plan's fiduciary net position is available in the separately issued IPERS financial report which is available on IPERS' website at www.ipers.org. Payables to the Pension Plan At June 30, 2021, there were no amounts due to IPERS. 67 7. Other Long-term Liabilities Changes in Long -Term Liabilities - Notes Payable Note Payable activity for the year ended June 30, 2021, was as follows: Governmental activities: July 1, 2020 Due Within Issues Retirements June 30, 2021 One Year $ 210,784 $ - $ - $ 210,784 $ A note payable was issued to Greater Iowa City Housing Fellowship for the purchase of an 11 unit apartment building for low income and disabled housing in the Peninsula Neighborhood. The terms of the loan are 1%, interest only payments for twenty years with a final balloon payment of $210,784 due on August 1, 2025. Changes in Long -Term Liabilities - Employee Vested Benefits Employee Vested Benefits activity for the year ended June 30, 2021, was as follows: Due Within July 1, 2020 Issues Retirements June 30, 2021 One Year Governmental activities: $ 2,730,646 $ 1,544,065 $ 1,524,382 S 2,750,329 $ 1,545,831 Business -type activities: $ 861,579 $ 521,949 $ 496,373 $ 887,155 $ 518,278 For the governmental activities, employee vested benefits are generally liquidated by the General Fund, Community Development Block Grant Fund and Other Shared Revenue and Grants Fund. Changes in Long -Term Liabilities - Landfill Closure Post -closure Care Costs Landfill Closure Post -closure care activity for the year ended June 30, 2021, was as follows: Business -type activities: Due Within July 1, 2020 Issues Retirements June 30, 2021 One Year $ 10,660,278 $ 585,912 $ - $ 11,246,190 $ In August 1993, the GASB issued Statement No. 18, Accounting for Municipal Solid Waste Landfill Closure and Post -closure Care Costs (the Statement). Under these rules, in addition to operating expenses related to current activities of the landfill, an expense provision and related liability are being recognized based on the future closure and post -closure care costs that will be incurred near or after the date the landfill no longer accepts waste. The recognition of these landfill closure and post -closure care costs is based on the amount of the landfill used during the year. 68 The estimated liability for landfill closure and post -closure care costs as of June 30, 2021, is $11,246,190, which is based on 55.3% usage (filled) of the landfill and is included in accrued liabilities within the Sanitation Fund. It is estimated that an additional amount of approximately $9,090,501 will be recognized as closure and post -closure care expenses between the date of the balance sheet and the date the landfill is expected to be filled to capacity by the year ended June 30, 2039. The estimated total current cost of the landfill closure and post -closure care costs at June 30, 2021, was determined by a licensed professional engineer and approximated at $20,336,691. It is based on the amount that would be paid if all equipment, facilities, and services required to close, monitor, and maintain the landfill were acquired as of June 30, 2021. These amounts are based on an estimated post -closure care and monitoring period of 30 years, consistent with current State Department of Natural Resources regulations. However, the actual cost of closure and post -closure care may be higher due to inflation, changes in technology, or changes in landfill laws and regulations. The City is required by federal and state laws and regulations to provide some form of financial assurance to finance closure and post -closure care. The City will meet its financial assurance obligations through the issuance of general obligation bonds. As of June 30, 2021, the Sanitation Fund had $14,669,736 in related equity in pooled cash and investments, at fair value designated for satisfaction of closure and post -closure costs. The City estimates that these cash reserves will only provide a fraction of the dollars needed to close and monitor the landfill. The remaining portion of post -closure care costs, anticipated future inflation costs and additional costs that might arise from changes in post -closure requirements (due to changes in technology or more rigorous environmental regulations, for example) may need to be covered by charges to future landfill users as well as City taxpayers. Changes in Long -Term Liabilities — Other Postemployment Benefits (OPEB) Plan Description: The City operates a single -employer self-funded medical and dental plan for all employees, which is offered to current and retired employees and their dependents. Group insurance benefits are established under Iowa Code Chapter 509A.13. No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75. All full-time employees who retire or terminate/resign and their eligible dependents are offered the following post -employment benefit options: Health insurance and dental insurance — The option of continuing with the City's health insurance plan at the individual's expense. These benefits cease upon Medicare eligibility. Life insurance — The option of converting the employee's City -paid policy to an individual policy at the individual's expense with the City's life insurance carrier. Long-term disability — For employees who terminate/resign and have been on the plan for a minimum of one year, the option of converting the employee's City -paid group policy to a personal policy at the individual's expense with the City's long-term disability insurance carrier. The above options, while at the individual's own expense, are included within the City's overall insurance package, which results in an implicit rate subsidy and an OPEB liability. Retired participants must be age 55 or older at retirement. At June 30, 2021, the following employees were covered by the benefit terms: Inactive employees or beneficiaries currently receiving benefit payments 66 Active employees 564 Total 630 Total OPEB Liability: The City's total OPEB liability of $9,697,868 was measured as of June 30, 2021 and was determined by an actuarial valuation as of that date. 69 Actuarial Assumptions: The total OPEB liability in the June 30, 2021 actuarial valuation was determined using the following actuarial assumptions and the entry age normal actuarial cost method, applied to all periods included in the measurement. Rate of inflation (effective June 30, 2021) Rates of salary increases (effective June 30, 2021) Discount rate (effective June 30, 2021) Healthcare cost trend rate (effective June 30, 2021) 2.60% per annum 3.25% per annum based on 2.60% inflation and 0.65% real wage inflation 2.19%, compounded annually, including inflation 8.00% initial rate decreasing by .5% annually to an ultimate rate of 4.50% Discount Rate: The discount rate used to measure the total OPEB liability was 2.19% which reflects the index rate for 20 -year tax-exempt general obligation municipal bonds with an average rating of AA/Aa or higher as of the measurement date. Mortality rates for general participants are from the SOA Pub -2010 General Headcount Weighted Mortality Table fully generational using Scale MP -2019. Mortality rates for public safety participants are from the SOA Pub -2010 General Headcount Weighted Mortality Table fully generational using Scale MP -2019. Annual retirement probabilities are based on varying rates by age and turnover probabilities mirror those used by IPERS and MFPRSI. The actuarial assumptions used in the June 30, 2021 valuation were based on the results of an actuarial experience study with dates corresponding to those listed above. Total OPEB Liability Total OPEB liability beginning of year $ 8,627,420 Changes for the year: Service Cost 733,608 Interest 240,186 Difference between expected and actual experience 459,049 Changes in assumptions 304,947 Benefit payments (667,342) Net changes 1,070,448 Total OPEB liability end of year $ 9,697,868 Changes of assumptions reflect a change in the discount rate from 2.66% in fiscal year 2020 to 2.19% in fiscal year 2021. 70 Sensitivity of the City's Total OPEB Liability to Changes in the Discount Rate: The following presents the total OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using a discount rate that is 1% lower (1.19%) or 1% higher (2.19%) than the current discount rate. Total OPEB liability 1% Decrease (1.19%) Discount Rate (2.19%) 1% Increase (3.19%) $ 10,365,126 $ 9,697,868 $ 9,056,498 Sensitivity of the City's Total OPEB Liability to Changes in the Healthcare Cost Trend Rate: The following presents the total OPEB liability of the City, as well as what the City's total OPEB liability would be if it were calculated using healthcare cost trend rate that is 1% lower (6.50%) or 1% higher (8.50%) than the current healthcare cost trend rate. Total OPEB liability 1% Decrease (6.5%) Healthcare Cost Trend Rate (7.5%) 1% Increase (8.50%) $ 8,517,061 $ 9,697,868 $ 11,102,748 OPEB Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB: For the year ended June 30, 2021, the City recognized OPEB expense of $1,192,863. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following resources: Deferred Outflows Deferred Inflows of Resources of Resources Differences between expected and actual experience $ 1,225,746 $ (612,245) Change of assumptions Total 1,021,797 (66,086) $ 2,247,543 $ (678,331) The amount reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized as OPEB expense as follows: Year Ended Total June 30, 2022 $ 219,069 June 30, 2023 219,069 June 30, 2024 219,069 June 30, 2025 219,069 June 30, 2026 219,069 Thereafter 473,867 $ 1,569,212 For the governmental activities, OPEB liability is generally liquidated by the General Fund, Community Development Block Grant Fund and Other Shared Revenue and Grants Fund 71 8. Fund Equity Fund balances for the governmental funds are reported in classifications that comprise a hierarchy based on the extent to which the government honors constraints on the specific purposes for which amounts in those funds can be spent. • The Nonspendable classification contains amounts not in spendable form or legally or contractually required to be maintained intact. • Restricted amounts contain restraint on their use externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or imposed by law through constitutional provisions or enabling legislation. • Committed amounts can only be used for specific purposes imposed by formal action of the government's highest level of decision-making authority. The highest level of decision-making authority is the City Council and it takes a resolution to establish, modify or rescind a fund balance commitment. • Amounts intended to be used for specific purposes are Assigned. Assignments should not cause deficits in the Unassigned fund balance. The Finance Director has been delegated authority by the City Council through a resolution to assign amounts to be used for specific purposes. • Unassigned fund balance is the residual classification for the General Fund. The General Fund is the only fund that would report a positive amount in unassigned fund balance. Residual deficit amounts of other governmental funds would also be reported as unassigned. The City would use Restricted fund balances first, followed by Committed resources, and then Assigned resources, as appropriate opportunities arise, but reserves the right to selectively spend Unassigned resources first to defer the use of these other classified funds. Components of Fund Balance Bridge, Other Street and Shared Traffic Other Revenue and Employee Other Control Debt Governmental Sound to nearest$ General Grants Benefits Construction Construction Service Funds Nonspendable: Perpetual Care Principal $ 69,000 $ - $ Inventory - 218,075 Property Held for Resale 399,605 Total Nonspendable 468,605 218,075 Total 69,000 218,075 399,605 686,680 Restricted for. Public Safety 420,274 - - - - - 420,274 Debt Service - - - - 7,550,454 7,550,454 GO Bond Projects - 8,177,972 18,291,352 - 26,469,324 State Funding - 4,405,316 - - - 4,405,316 Grant Agreement - 3,299,084 3,299,084 Affordable Housing - 3,598,374 - - 3,598,374 Economic Development - - 1,448,938 1,448,938 Notes Receivable 982,233 - - 982,233 Public Safety Employee Benefits - - 3,630,989 - 3,630,989 Other Restricted 52,677 1,090,331 - 438,463 1,581,471 Total Restricted 1,455,184 9,094,021 3,630,989 8,177,972 18,291,352 7,550,454 5,186,485 53,386,457 Assigned to: Library Programs 1,308,282 - - - 1,308,282 Replacement and Acquisition Reserves 8,518,480 - - - - - 8,518,480 Other Assigned 55,817 - - - - 55,817 Total Assigned 9,882,579 - - 9,882,579 Unassigned: 40,413,826 (27,414) 40,386,412 Total Fund Balances $ 52,220,194 $ 9,312.096 $ 3,630,989 S 8,177.972 $ 18291,352 S 7,550.454 $ 5.159,071 S 104,342,128 72 9. 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, 2021 the City purchased property, liability, and workers' compensation insurance under the program that provides for a $100,000 self-insured retention per occurrence on property losses, a $500,000 self-insured retention per occurrence on liability, and a zero self- insured retention on workers' compensation losses for all employees except Fire Department employees. Workers compensation losses for Fire Department employees are fully self-funded. The liability insurance provides coverage for claims in excess of the aforementioned self-insured retention up to a maximum of $21,000,000 annual aggregate of losses paid. Settled claims have not exceeded this commercial coverage in any of the past thirty-one fiscal years. The operating funds pay annual premiums to the Loss Reserve Fund. Accumulated monies in the Loss Reserve Fund are available to cover the self-insured retention amounts and any uninsured losses. 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, 2021 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, 2021 and 2020 are as follows: 2019 - 2020 2020 - 2021 Beginning -of - Fiscal -Year Liability Current -Year Claims and Changes in Estimates Claim Payments $ 2,707,000 $ 761,000 $ 907,000 2,561,000 2,562,000 1,850,000 Balance at Fiscal Year -End $ 2,561,000 3,273,000 Also, the City is partially self-insured, through stop -loss insurance, for employee health care coverage, which is available to all of its permanent employees. This insurance provides stop -loss coverage for claims in excess of $125,000 per employee with an aggregate stop -loss of $12,281,650. The operating funds are charged premiums by the Loss Reserve Fund. The City reimburses a health insurance provider for actual medical costs incurred, plus a claims processing\administrative fee. Changes in the Loss Reserve Fund's claims liability amount for health care coverage for the years ended June 30, 2021 and 2020 are as follows: Beginning -of - Fiscal -Year Liability Current -Year Claims and Changes in Estimates 2019 - 2020 $ 850,000 $ 2020 - 2021 1,069,000 73 9,167,000 9,900,000 Claim Payments $ 8,948,000 10,511,000 Balance at Fiscal Year -End $ 1,069,000 458,000 10. Commitments and Contingencies Contractual Commitments The total outstanding contractual commitments as of June 30, 2021 are as follows: Fund Project Amount Bridge, street and traffic Paving and Bridge Construction, control construction Engineering Design and Consulting $ 12,192,799 Other construction Public Works & Culture and Recreation Construction 1,209,455 Parking Parking Facility Restoration Repair 129,667 Wastewater Sewer Construction & Influent Rake Replacement 1,727,287 Water Water Construction & Peninsula Well Field Power Redundancy Project 50,661 Transit Transit Bus Sign Replacements/Transit Amenities 7,671 Airport Runway Obstruction Mitigation & Runway Relocation 340,700 Stormwater Stormwater System Improvements & Storm Sewer 114,002 Replacements Developer Commitments $ 15,772,242 In order to encourage development within designated TIF districts, the City Council has approved developer grants to 8 different projects. The grants are to be paid only after certain conditions have been met by each project developer, and are to be paid over many years in the form of a rebate of a predetermined percentage of future property taxes generated by the property. Currently, it is estimated that outstanding commitments totaling $36,943,555 exist, of which $2,161,853 is expected to be paid in the next fiscal year. These items are expensed in the period in which they are paid. There were payments made in the current fiscal year in the amount of $933,304. No liability is recognized due to the fact that the agreements are conditional and the payments are to be funded by future property taxes receivable on the project. 11. Contingent Liabilities Litigation The City is a defendant in a number of lawsuits arising principally from claims against the City for alleged improper actions by City employees, with such lawsuits typically involving claims of improper police action, unlawful taking of property by zoning, negligence, appeals of condemnations, and discrimination. Total damages claimed are substantial; however, it has been the City's experience that such actions are settled for amounts substantially less than claimed amounts. The City's management estimates that the potential claims against the City, not covered by various insurance policies, would not materially affect the financial condition of the City. The City has the authority to levy additional taxes (outside the regular limit) to cover uninsured judgments against the City. 74 12. Tax Abatements Governmental Accounting Standards Board Statement No. 77 defines tax abatements as a reduction in tax revenues that results from an agreement between one or more governments and an individual or entity in which (a) one or more governments promise to forgo tax revenues to which they are otherwise entitled and (b) the individual or entity promises to take a specific action after the agreement has been entered into that contributes to economic development or otherwise benefits the governments or the citizens of those governments. City Tax Abatements The City provides tax abatements for urban renewal and economic development projects with tax increment financing as provided for in Chapters 15A and 403 of the Code of Iowa. For these types of projects, the City enters into agreements with developers which require the City, after developers meet the terms of the agreements, to rebate a portion of the property tax paid by the developers, to pay the developers an economic development grant or to pay the developers a predetermined dollar amount. No other commitments were made by the City as part of these agreements. For the year ended June 30, 2021, $372,143 of property tax was diverted from the City under the urban renewal and economic development projects. Tax Abatements of Other Entities Property tax revenues of the City were not reduced by any amount for the year ended June 30, 2021 under agreements entered into by any entities. 13. COVID-19 In March 2020, the COVID-19 outbreak was declared a global pandemic. The disruption to businesses across a range of industries in the United States continue to evolve. The full impact to local, regional and national economies, including that of the City, remains uncertain. To date, the outbreak has not created a material disruption to the operations of the City. However, the extent of the financial impact of COVID-19 will depend on future developments, including the spread of the virus, duration and timing of the economic recovery. Due to these uncertainties, management cannot reasonably estimate the potential impact to the City. 14. New Governmental Accounting Standards Board (GASB) Standards The Governmental Accounting Standards Board (GASB) has issued eight statements not yet implemented by the City. The statements, which might impact the City's financial statements, are as follows: Statement No. 87, Leases, will be effective for fiscal year ending June 30, 2022. The objective of this Statement is to better meet the information needs of financial statement users by improving accounting and financial reporting for leases by governments. Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period, will be effective for fiscal year ending June 30, 2022. The objectives of this Statement are to enhance the relevance and comparability of information about capital assets and the cost of borrowing for a reporting period and to simplify accounting for interest cost incurred before the end of a construction period. Statement No. 91, Conduit Debt Obligations, will be effective for fiscal year ending June 30, 2023. The objectives of this Statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. 75 Statement No. 92, Omnibus 2020, will be effective for fiscal year ending June 30, 2022. The objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB Statements. Statement No. 93, Replacement of Interbank Offered Rates, will be effective for fiscal year ending June 30, 2022. The objective of this Statement is to address those and other accounting and financial reporting implications that result from the replacement of an IBOR. Statement No. 94, Public -Private and Public -Public Partnerships and Availability Payment Arrangements, will be effective for fiscal year ending June 30, 2023. The primary objective of this Statement is to improve financial reporting by addressing issues related to public-private and public -public partnership arrangements (PPPs). Statement No. 96, Subscription -Based Information Technology Arrangements, will be effective for fiscal year ending June 30, 2023. This Statement provides guidance on the accounting and financial reporting for subscription -based information technology arrangements (SBITAs) for government end users (governments). Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans- an amendment of GASB Statements No. 14 and No. 84, and a supersession of GASB Statement No. 32, will be effective for fiscal year ending June 30, 2022. The primary objective of this Statement are to 1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; 2) mitigate costs associated with the reporting of certain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and 3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. The City's management has not yet determined the effect these statements will have on the City's financial statements. 76 77 City of Iowa City, Iowa Budgetary Comparison Schedule Budget and Actual - All Governmental Funds and Enterprise Funds Budgetary Basis Required Supplementary Information Revenues: Property taxes Delinquent property taxes Tax increment financing taxes Other city taxes Special assessments Licenses and permits Intergovernmental Charges for services Use of money and property Miscellaneous Total revenues For the Year Ended June 30, 2021 (dollar amounts expressed in thousands) Governmental Fund Types Enterprise Fund Actual Budgetary Types Actual Total Actual Basis Budgetary Basis Budgetary Basis 65,796 $ - $ 65,796 985 985 2,638 2,638 2,639 - 2,639 2,541 11 2,552 32,212 14,440 46,652 5,773 40,315 46,088 823 1,246 2,069 2,032 1,248 3,280 115,439 57,260 172,699 Expenditures/Expenses: Public safety 26,700 26,700 Public works 10,743 10,743 Health and social services 571 571 Culture and recreation 13,606 13,606 Community and economic development 8,240 8,240 General government 9,585 9,585 Debt service 14,652 14,652 Capital outlay 18,334 18,334 Business -type 56,758 56,758 Total expenditures/expenses 102,431 56,758 159,189 Excess (deficiency) of revenues over (under) expenditures/expenses 13,008 502 13,510 Other financing sources and uses, net 9,230 3,609 12,839 Net change in fund balances 22,238 4,111 26,349 Balances, beginning of year 89,084 91,331 180,415 Balances, end of year See Note to Required Supplementary Information. $ 111,322 $ 95,442 $ 206,764 78 Budgeted Amounts Final to Actual Variance - Positive Original Final (Negative) $ 65,849 $ 65,849 $ (53) - 985 2,593 2,593 45 2,958 2,307 332 1 1 (1) 2,210 1,991 561 35,753 49,706 (3,054) 48,040 44,636 1,452 3,037 2,272 (203) 2,581 2,535 745 163,022 171,890 809 27,852 28,047 1,347 11,754 11,829 1,086 605 605 34 16,432 16,417 2,811 8,902 10,091 1,851 11,454 12,979 3,394 14,520 14,520 (132) 22,705 54,748 36,414 61,279 73,729 16,971 175,503 222,965 63,776 (12,481) (51,075) 64,585 12,773 12,213 626 292 (38,862) $ 65,211 137,269 180,442 $ 137,561 $ 141,580 79 City of Iowa City, Iowa Budgetary Comparison Schedule Budget to GAAP Reconciliation Required Supplementary Information For the Year Ended June 30, 2021 (dollar amounts expressed in thousands) Governmental Fund Types Budget Basis Accrual Modified Accrual Adjustments Basis Revenues $ 115,439 $ (14,007) $ 101,432 Expenditures 102,431 (6,922) 95,509 Net 13,008 (7,085) 5,923 Other financing sources and uses, net 9,230 (2,578) 6,652 Beginning Fund Balances 89,084 2,684 91,768 Ending Fund Balances $ 111,322 $ (6,979) $ 104,343 Enterprise Fund Types Budget Basis Accrual Accrual Adjustments Basis Revenues $ 57,260 $ 2,643 $ 59,903 Expenditures 56,758 4,026 60,784 Net 502 (1,383) (881) Other financing sources and uses, net 3,609 1,625 5,234 Beginning Fund Balances 91,331 298,092 389,423 Ending Fund Balances $ 95,442 $ 298,334 $ 393,776 See Note to Required Supplementary Information. City of Iowa City, Iowa Note to Required Supplementary Information - Budgetary Reporting For the Year Ended June 30, 2021 In accordance with the Code of Iowa, the City Council annually adopts a budget following required public notice and hearing which includes all funds, except internal service funds and agency funds. The budget basis of accounting is a modified accrual basis. The annual budget may be amended during the year utilizing similar statutorily prescribed procedures. Formal and legal budgetary control is based upon nine major classes of expenditures known as functions, not by fund or fund type. These nine functions are: public safety, public works, health and social services, culture and recreation, community and economic development, general government, debt service, capital outlay and business -type. The legal level control is at the aggregated function level, not at the fund or fund type level. During the year, budget amendments increased budgeted revenues by $8,868,000 and expenditures by $47,462,000. The budget amendments were primarily due to changes in the breadth and timing of capital improvement projects, which the City budgets in full during the initial year of the projects and amends future year budgets for carryover. During the year ended June 30, 2021, the city over expended the Debt Service function by $132,000 due to unanticipated interest expense due to a larger than anticipated premium amount when the general obligation bonds were issued. 81 82 City of Iowa City, Iowa Required Supplementary Information - Schedule of the City's Proportionate Share of the Net Pension Liability Municipal Fire and Police Retirement System of Iowa For the Last Seven Years* (amounts expressed in thousands) 2021 2020 2019 2018 2017 2016 2015 City's proportion of the net pension liability 3.621079% 3.684880% 3.706970% 3.648635% 3.697128% 3.704972% 3.778137% City's proportionate share of the net pension liability $ 28,882 $ 24,170 $ 22,071 $ 21,398 $ 23,117 $ 17,406 $ 13,696 City's covered payroll 11,503 11,155 10,743 10,347 10,019 9,716 9,648 City's proportionate share of the net pension liability as a percentage of its covered payroll 251.08% 216.67% 205.45% 206.80% 230.73% 179.15% 141.96% Plan fiduciary net position as a percentage of the total pension liability 76.47% 79.94% 81.07% 80.60% 78.20% 83.04% 86.27% s In accordance with GASB Statement No. 68, the amounts presented for each fiscal year were determined as of June 30 of the preceding fiscal year. Note: GASB Statement No. 68 requires ten years of information to be presented in this table. However, until a full 10 -year trend is compiled, the City will present information for those years for which information is available. 83 City of Iowa City, Iowa Required Supplementary Information - Schedule of the City's Contributions Municipal Fire and Police Retirement System of Iowa For the Last Ten Years (amounts expressed in thousands) Statutorily required contributions 2021 2020 2019 2018 $ 2,903 $ 2,808 $ 2,902 $ 2,759 Contributions in relation to the statutorily required contribution (2,903) (2,808) (2,902) (2,759) Contribution deficiency (excess) $ - $ - $ - $ City's covered payroll $ 11,468 $ 11,503 $ 11,155 $ 10,743 Contributions as a percentage of covered payroll 25.31% 24.41% 26.02% 25.68% 84 2017 2016 2015 2014 2013 2012 $ 2,682 $ 2,782 $ 2,955 $ 2,906 $ 2,383 $ 2,277 (2,682) (2,782) (2,955) (2,906) (2,383) (2,277) $ 10,347 $ 10,019 $ 9,716 $ 9,648 $ 9,122 $ 9,197 25.92% 27.77% 30.41% 30.12% 26.12% 24.76% 85 City of Iowa City, Iowa Notes to Required Supplementary Information - Pension Liability Municipal Fire and Police Retirement System of Iowa Year ended June 30, 2021 Changes of benefit terms: There were no significant changes of benefit terms. Changes of assumptions: The 2018 valuation changed postretirement mortality rates on the RP -2014 Blue Collar Healthy Annuitant Table with males set -forward zero years, females set -forward two years and disabled individuals set -forward three years (male only rates), with generational projection of future mortality improvements with 50% of Scale BB beginning in 2017. The 2017 valuation added five years projection of future mortality improvement with Scale BB. The 2016 valuation changed postretirement mortality rates to the RP -2000 Blue Collar Combined Healthy Mortality Table with males set -back two years, females set -forward one year and disabled individuals set -forward one year (male only rates), with no projection of future mortality improvement. The 2015 valuation phased in the 1994 Group Annuity Mortality Table for postretirement mortality. This resulted in weighting of 1/12 of the 1971 Group Annuity Mortality Table and 11/12 of the 1994 Group Annuity Morality Table. The 2014 valuation phased in the 1994 Group Annuity Mortality Table for postretirement mortality. This resulted in weighting of 2/12 of the 1971 Group Annuity Mortality Table and 10/12 of the 1994 Group Annuity Morality Table. 86 City of Iowa City, Iowa Required Supplementary Information - Schedule of the City's Proportionate Share of the Net Pension Liability Iowa Public Employees' Retirement System For the Last Seven Years* (amounts expressed in thousands) 2021 2020 2019 2018 2017 2016 2015 City's proportion of the net pension liability 0.3947745% 0.4053890% 0.4016869% 0.3968158% 0.3962696% 0.4159256% 0.4378904% City's proportionate share of the net pension liability $ 27,732 $ 23,475 $ 25,420 $ 26,433 $ 24,938 $ 20,549 $ 17,366 City's covered payroll 31,345 30,852 30,190 29,619 28,448 28,495 28,654 City's proportionate share of the net pension liability as a percentage of its covered payroll 88.47% 76.09% 84.20% 89.24% 87.66% 72.11% 60.61% Plan fiduciary net position as a percentage of the total pension liability 82.90% 85.45% 83.62% 82.21% 81.82% 85.19% 87.61% * In accordance with GASB Statement No. 68, the amounts presented for each fiscal year were determined as of June 30 of the preceding fiscal year. Note: GASB Statement No. 68 requires ten years of information to be presented in this table. However, until a full 10 -year trend is compiled, the City will present information for those years for which information is available. 87 City of Iowa City, Iowa Required Supplementary Information - Schedule of the City's Contributions Iowa Public Employees' Retirement System For the Last Ten Years (amounts expressed in thousands) Statutorily required contributions 2021 2020 2019 2018 $ 3,025 $ 2,959 $ 2,912 $ 2,696 Contributions in relation to the statutorily required contribution (3,025) (2,959) (2,912) (2,696) Contribution deficiency (excess) $ - $ - $ - $ City's covered payroll $ 32,047 $ 31,345 $ 30,852 $ 30,190 Contributions as a percentage of covered payroll 9.44% 9.44% 9.44% 8.93% 88 2017 2016 2015 2014 2013 2012 $ 2,645 $ 2,540 $ 2,545 $ 2,559 $ 2,442 $ 2,327 (2,645) (2,540) (2,545) (2,559) (2,442) (2,327) $ 29,619 $ 28,448 $ 28,495 $ 28,654 $ 28,170 $ 28,833 8.93% 8.93% 8.93% 8.93% 8.67% 8.07% 89 City of Iowa City, Iowa Notes to Required Supplementary Information - Pension Liability Iowa Public Employees' Retirement System Year ended June 30, 2021 Changes of benefit terms: There are no significant changes in benefit terms. Changes of assumptions: The 2018 valuation implemented the following refinements as a result of an experience study dated June 28, 2018: • Changed mortality assumptions to the RP -2014 mortality tables with mortality improvements modeled using Scale MP -2017. • Adjusted retirement rates. • Lowered disability rates • Adjusted the probability of a vested Regular member electing to receive a deferred benefit. • Adjusted the merit component of the salary increase assumption. The 2017 valuation implemented the following refinements as a result of an experience study dated March 24, 2017: • Decreased the inflation assumption from 3.00% to 2.60%. • Decreased the assumed rate of interest on member accounts from 3.75% to 3.5% per year. • Decreased the discount rate from 7.50% to 7.00%. • Decreased the wage growth assumption from 4.00% to 3.25%. • Decreased the payroll growth assumption from 4.00% to 3.25%. The 2014 valuation implemented the following refinements as a result of a quadrennial experience study: • Decreased the inflation assumption from 3.25% to 3.00% • Decreased the assumed rate of interest on member accounts from 4.00% to 3.75% per year. • Adjusted male mortality rates for retirees in the Regular membership group. • Moved from an open 30 year amortization period to a closed 30 year amortization period for the UAL beginning June 30, 2014. Each year thereafter, changes in the UAL from plan experience will be amortized on a separate closed 20 year period. City of Iowa City, Iowa Required Supplementary Information - Schedule of Changes in the City's Total OPEB Liability, Related Ratios and Notes For the Last Four Years (amounts expressed in thousands) 2021 2020 2019 2018 Service Cost $ 734 $ 633 $ 553 $ 502 Interest 240 323 297 245 Difference between expected and actual experience 459 (483) 1,161 (377) Changes in assumptions 305 (83) 225 982 Benefit payments (667) (641) (948) (174) Net change in total OPEB liability 1,071 (251) 1,288 1,178 Total OPEB liability beginning of year 8,627 8,878 7,590 6,412 Total OPEB liability end of year $ 9,698 $ 8,627 $ 8,878 $ 7,590 City's covered -employee payroll Total OPEB liability as a percentage of covered -employee payroll $ 43,515 $ 42,848 $ 42,007 $ 40,933 22.29% 20.13% 21.13% 18.54% Note: GASB Statement No. 75 requires ten years of information to be presented in this table. However, until a full 10 -year trend is compiled, the City will present information for those years for which information is available. Note: No assets are accumulated in a trust that meets the criteria in paragraph 4 of GAS Statement No. 75. Changes of benefit terms: There were no significant changes of benefit terms. Changes of assumptions: Changes in assumptions and other inputs reflect the effects of changes in the discount rate each period. The following are the discount rates used in each period. Year ended June 30, 2021 Year ended June 30, 2020 Year ended June 30, 2019 Year ended June 30, 2018 2.19% 2.66% 3.51% 3.87% Mortality table has been updated from SOA RPH-2017 Total Dataset Mortality Table fully generational using Scale MP -2017 to SOA Pub -2010 General Headcount Weighted Mortality Table fully generational using Scale MP -2019 for general participants, SOA Pub -2010 Public Safety Headcount Weighted Mortality Table fully generational using Scale MP -2019 for public safety participants, and SOA Pub -2010 Continuing Survivor Headcount Weighted Mortality Table fully generational using Scale MP -2019 for surviving spouses. Termination rates, salary merit increases and retirement rates for IPERS employees have been updated to be based on the Iowa Public Employees' Retirement System July 1, 2019 Actuarial Valuation Report. Termination rates, salary merit increases and retirement rates for MFPRSI employees have been updated to follow the Municipal Fire and Police Retirement System of Iowa July 1, 2019 Actuarial Valuation Report. Health care trend rates have been updated to an initial trend rate of 8.0% decreasing by 0.5% annually to an ultimate rate of 4.5%. 91 92 Nonmajor Governmental Funds Special Revenue Funds Special Revenue Funds account for revenues derived from specific sources that are required to be accounted for as separate funds. The funds in this category and their purpose are as follows: Economic Development Fund — accounts for revenue and expenditures of economic development activities. Community Development Block Grant Fund — accounts for revenue from the U.S. Department of Housing and Urban Development's Community Development Block Grant programs. Metropolitan Planning Organization of Johnson County Fund — accounts for the financial activities of the metropolitan/rural cooperative planning organization. 93 City of Iowa City, Iowa Combining Balance Sheet Nonmajor Governmental Funds June 30, 2021 (amounts expressed in thousands) Special Revenue Metropolitan Community Planning Development Organization Economic Block of Johnson Development Grant County Total Assets Equity in pooled cash and investments $ 1,422 $ 30 $ 409 $ 1,861 Receivables: Property tax 515 - - 515 Notes - 3,299 - 3,299 Due from other governments - - 59 59 Total assets $ 1,937 $ 3,329 $ 468 $ 5,734 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable Accrued liabilities Liabilities payable from restricted assets: Advances from grantors Total liabilities 85 $ 1 $ 4 25 4 $ 26 90 30 25 85 30 30 145 Deferred Inflows of Resources Unavailable revenues: Succeeding year property taxes 430 - - 430 Grants - - - - Total deferred inflows of resources 430 - - 430 Fund Balances Restricted 1,449 3,299 438 5,186 Unassigned (27) - - (27) Total fund balances 1,422 3,299 438 5,159 Total liabilities, deferred inflows of resources and fund balances $ 1,937 $ 3,329 $ 468 $ 5,734 94 City of Iowa City, Iowa Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Special Revenue Metropolitan Community Planning Development Organization Economic Block of Johnson Development Grant County Total Revenues Property taxes $ 3,104 $ $ - $ 3,104 Intergovernmental 69 1,354 384 1,807 Use of money and property 9 32 2 43 Miscellaneous - 43 - 43 Total revenues 3,182 1,429 386 4,997 Expenditures Current: Community and economic development 1,490 1,494 761 3,745 Total expenditures 1,490 1,494 761 3,745 Excess (deficiency) of revenues over (under) expenditures 1,692 (65) (375) 1,252 Other Financing Sources (Uses) Transfers in 52 379 431 Transfers out (1,109) (141) (1,250) Total other financing sources and (uses) (1,057) (141) 379 (819) Net change in fund balances 635 (206) 4 433 Fund Balances, Beginning 787 3,505 434 4,726 Fund Balances, Ending $ 1,422 $ 3,299 $ 438 $ 5,159 95 96 Nonmajor Enterprise Funds Enterprise Funds account for operations and activities of the City that are financed and operated in a manner similar to a private business enterprise, and where the costs of providing services to the general public on a continuing basis are expected to be financed or recovered primarily through user charges, or where the City has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. The funds in this category are as follows: Airport Fund — accounts for the operation and maintenance of the airport facility. Parking Fund — accounts for the operation and maintenance of the "on" and "off' street public parking facilities. 97 City of Iowa City, Iowa Combining Statement of Net Position Nonmajor Enterprise Funds June 30, 2021 (amounts expressed in thousands) Airport Parking Total Assets Current assets: Equity in pooled cash and investments $ $ 3,198 $ 3,198 Receivables: Accounts and unbilled usage 25 323 348 Interest 1 1 Due from other governments 414 2 416 Total current assets 439 3,524 3,963 Noncurrent assets: Restricted assets: Equity in pooled cash and investments 107 8 115 Capital assets: Land 11,995 3,489 15,484 Buildings 5,458 41,647 47,105 Improvements other than buildings 445 328 773 Machinery and equipment 531 1,622 2,153 Infrastructure 17,451 17,451 Accumulated depreciation (12,457) (24,417) (36,874) Construction in progress 152 152 Total noncurrent assets 23,682 22,677 46,359 Total assets 24,121 26,201 50,322 Deferred Outflows of Resources Pension related deferred outflows 12 184 196 OPEB related deferred outflows 3 55 58 Total deferred outflows of resources 15 239 254 Liabilities Current liabilities: Accounts payable 4 92 96 Contracts payable 34 6 40 Accrued liabilities 4 62 66 Employee vested benefits 3 58 61 Due to other funds 174 - 174 Total current liabilities 219 218 437 Noncurrent liabilities: Liabilities payable from restricted assets: Deposits 8 1 9 Advances from other funds - 1,037 1,037 Employee vested benefits 2 42 44 Net pension liability 56 816 872 Other post employment benefits obligation 14 238 252 Total noncurrent liabilities 80 2,134 2,214 Total liabilities 299 2,352 2,651 Deferred Inflows of Resources Pension related deferred inflows 2 28 30 OPEB related deferred inflows 1 17 18 Total deferred inflows of resources 3 45 48 Net Position Net investment in capital assets 23,575 22,669 46,244 Restricted for future improvements 100 304 404 Unrestricted 159 1,070 1,229 Total net position $ 23,834 $ 24,043 $ 47,877 98 City of Iowa City, Iowa Combining Statement of Revenues, Expenses and Changes in Fund Net Position Nonmajor Enterprise Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Airport Parking Total Operating Revenues: Charges for services $ 376 $ 3,758 $ 4,134 Miscellaneous 48 48 Total operating revenues 376 3,806 4,182 Operating Expenses: Personal services 86 1,902 1,988 Commodities 335 86 421 Services and charges 426 1,417 1,843 847 3,405 4,252 Depreciation 1,006 1,257 2,263 Total operating expenses 1,853 4,662 6,515 Operating loss Nonoperating Revenues: Operating grants Interest income Total nonoperating revenues Loss before capital contributions and transfers (1,477) (856) (2,333) 332 332 15 15 332 15 347 (1,145) (841) (1,986) Capital contributions 267 - 267 Transfers in 100 - 100 Transfers out (16) - (16) Change in net position (794) (841) (1,635) Net Position, Beginning 24,628 24,884 49,512 Net Position, Ending $ 23,834 $ 24,043 $ 47,877 99 CITY OF IOWA CITY, IOWA COMBINING STATEMENT OF CASH FLOWS NONMAJOR ENTERPRISE FUNDS For the Year Ended June 30, 2021 (amounts expressed in thousands) Airport Parking Total Cash Flows From Operating Activities Receipts from customers and users $ 373 $ 3,522 $ 3,895 Payments to suppliers (1,179) (1,636) (2,815) Payments to employees (83) (1,912) (1,995) Net cash flows used for operating activities (889) (26) (915) Cash Flows From Noncapital Financing Activities Operating grants received 843 1 844 Transfers from other funds 100 100 Transfers to other funds (16) (16) Advances from other funds 174 174 Repayment of advances from other funds (138) (137) (275) Net cash flows from (used for) noncapital financing activities 963 (136) 827 Cash Flows From Capital and Related Financing Activities Capital grants received 184 184 Acquisition and construction of property and equipment (258) (258) Net cash flows used for capital and related financing activities (74) (74) Cash Flows From Investing Activities Interest on investments 25 25 Net increase (decrease) in cash and cash equivalents - (137) (137) Cash and Cash Equivalents, Beginning 107 3,343 3,450 Cash and Cash Equivalents, Ending $ 107 $ 3,206 $ 3,313 Reconciliation of operating loss to net cash flows from (used for) operating activities: Operating loss $ (1,477) $ (856) $ (2,333) Adjustments to reconcile operating loss to net cash flows used for operating activities: Depreciation expense 1,006 1,257 2,263 Changes in: Receivables: Accounts and unbilled usage (1) (284) (285) Due from other governments (2) (2) Accounts payable (418) (133) (551) Accrued liabilities 5 5 Net pension liability 8 72 80 Deferred outflows of resources (1) (23) (24) Deferred inflows of resources (6) (91) (97) Other post employment benefits asset/obligation 2 27 29 Total adjustments 588 830 1,418 Net cash flows used for operating activities $ (889) $ (26) $ (915) Noncash Investing, Capital, and Financing Activities: Capital grants not yet received $ 163 $ $ 163 Operating grants not yet received $ 249 $ 2 $ 251 100 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, equipment and vehicle rental from a central vehicle pool, and two-way radios provided to other City departments. Central Services Fund — accounts for the support services of photocopying, mail and overnight shipping provided to other City departments. Loss Reserve Fund — accounts for the property, liability, Workers' Compensation and health insurance premiums and claims activity for City departments, including the self-insured retention portion. Information Technology Fund — accounts for the accumulation and allocation of costs associated with telecommunications and data processing, including the operation and replacement of equipment. 101 City of Iowa City, Iowa Combining Statement of Net Position Internal Service Funds June 30, 2021 (amounts expressed in thousands) Equipment Central Loss Information Maintenance Services Reserve Technology Total Assets Current assets: Equity in pooled cash and investments $ 18,107 $ 809 $ 17,034 $ 3,772 $ 39,722 Receivables: Accounts and unbilled usage 11 165 - 176 Interest 12 18 2 32 Due from other governments 64 - - 64 Inventories 568 - 568 Total current assets 18,762 809 17,217 3,774 40,562 Noncurrent assets: Capital assets: Land 685 - 685 Buildings 1,298 - 183 1,481 Improvements other than buildings 50 50 Machinery and equipment 23,377 94 19 1,604 25,094 Infrastructure - - - 3,605 3,605 Accumulated depreciation (12,179) (53) (19) (1,742) (13,993) Construction in progress 66 - - 66 Total noncurrent assets 13,297 41 - 3,650 16,988 Total assets 32,059 850 17,217 7,424 57,550 Deferred Outflows of Resources Pension related deferred outflows 152 5 30 159 346 OPEB related deferred outflows 45 3 3 32 83 Total deferred outflows of resources 197 8 33 191 429 Liabilities Current liabilities: Accounts payable 160 10 289 177 636 Accrued liabilities 45 1 3,740 51 3,837 Employee vested benefits 40 3 29 72 Due to other governments 7 7 Total current liabilities 252 11 4,032 257 4,552 Noncurrent liabilities: Employee vested benefits 30 3 24 57 Net pension liability 686 24 136 717 1,563 Other post employment benefits liability 196 14 14 140 364 Total noncurrent liabilities 912 38 153 881 1,984 Total liabilities 1,164 49 4,185 1,138 6,536 Deferred Inflows of Resources Pension related deferred inflows 23 1 5 24 53 OPEB related deferred inflows 14 1 1 10 26 37 2 6 34 79 Net Position Net investment in capital assets 13,297 41 - 3,650 16,988 Unrestricted 17,758 766 13,059 2,793 34,376 Total net position $ 31,055 $ 807 $ 13,059 $ 6,443 $ 51,364 102 City of Iowa City, Iowa Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Equipment Central Loss Information Maintenance Services Reserve Technology Total Operating Revenues: Charges for services $ 7,097 $ 195 $ 12,454 $ 2,892 $ 22,638 Total operating revenues 7,097 195 12,454 2,892 22,638 Operating Expenses: Personal services 1,100 39 230 1,237 2,606 Commodities 1,556 - 110 775 2,441 Services and charges 575 94 12,087 574 13,330 3,231 133 12,427 2,586 18,377 Depreciation 2,042 14 - 257 2,313 Total operating expenses 5,273 147 12,427 2,843 20,690 Operating income 1,824 48 27 49 1,948 Nonoperating Revenues: Gain (loss) on disposal of capital assets 309 (7) - 4 306 Operating grants 11 - - 11 Interest income 52 3 (3) 15 67 Total nonoperating revenues 372 (4) (3) 19 384 Income before transfers 2,196 44 24 68 2,332 Capital contributions 86 - - 86 Transfers in 1,207 - 40 1,247 Transfers out (100) (11) - (111) Change in net position 3,389 33 24 108 3,554 Net Position, Beginning 27,666 774 13,035 6,335 47,810 Net Position, Ending $ 31,055 $ 807 $ 13,059 $ 6,443 $ 51,364 103 City of Iowa City, Iowa Combining Statement of Cash Flows Internal Service Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Equipment Central Loss Information Maintenance Services Reserve Technology Total Cash Flows From Operating Activities Receipts from customers and users $ 7,065 $ 195 $ 12,432 $ 2,892 $ 22,584 Payments to suppliers (2,300) (105) (12,138) (1,196) (15,739) Payments to employees (1,076) (38) (196) (1,144) (2,454) Net cash flows from operating activities 3,689 52 98 552 4,391 Cash Flows From Noncapital Financing Activities Operating grants received 10 10 Transfers from other funds 1,207 40 1,247 Transfers to other funds (100) (11) (111) Net cash flows from (used for) noncapital financing activities 1,117 (11) 40 1,146 Cash Flows From Capital and Related Financing Activities Acquisition and construction of property and equipment (4,576) (16) (161) (4,753) Proceeds from sale of property 309 4 313 Net cash flows used for capital and related financing activities (4,267) (16) (157) (4,440) Cash Flows From Investing Activities Interest on investments 99 5 147 24 275 Net increase in cash and cash equivalents 638 30 245 459 1,372 Cash and Cash Equivalents, Beginning 17,469 779 16,789 3,313 38,350 Cash and Cash Equivalents, Ending 8 18,107 $ 809 $ 17,034 $ 3,772 $ 39,722 Reconciliation of operating income to net cash flows from operating activities: Operating income S 1,824 $ 48 $ 27 $ 49 $ 1,948 Adjustments to reconcile operating income to net cash flows from operating activities: Depreciation expense 2,042 14 257 2,313 Changes in: Receivables: Accounts and unbilled usage (11) (22) (33) Due from other governments (21) (21) Inventories (53) (53) Accounts payable (123) (11) (14) 153 5 Accrued liabilities 3 (1) 101 6 109 Employee vested benefits (2) (2) (1) (2) (7) Due to other governments 7 - - - 7 Net pension liability 93 5 21 163 282 Deferred outflows of resources (20) - (3) (25) (48) Deferred inflows of resources (72) (2) (13) (65) (152) Other post employment benefits liability 22 1 2 16 41 Total adjustments 1,865 4 71 503 2,443 Net cash flows from operating activities $ 3,689 $ 52 $ 98 $ 552 $ 4,391 Noncash Investing, Capital, and Financing Activities: Contributions of capital assets from government and others $ 93 $ $ $ $ 93 104 Statistical Section Tabs Statistical Section This part of the City of Iowa City's comprehensive annual financial report represents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government's overall financial health. Contents Page Financial Trends These schedules contain trend information to help the reader understand how the government's financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the government's most significant local revenue source, the property tax. Debt Capacity These schedules present information to help the reader assess the affordability of the government's current levels of outstanding debt and the government's ability to issue additional debt in the future. Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the government's financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the government's financial report relates to the services the government provides and the activities it performs. 107 112 122 128 130 Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial report for the relevant year. 105 106 City of Iowa City, Iowa Net Position by Component Last Ten Fiscal Years (Accrual basis of accounting) (amounts expressed in thousands) 2012 2013' 2014 2015 20162 2017 2018 2019 2020 2021 Governmental activities Net investment in capital assets $ 135,998 $ 133,989 $ 138,482 $ 153,729 $ 163,362 $ 183,651 $ 203,077 $ 208,028 $ 220,004 $ 228,418 Restricted 35,021 22,867 39,958 36,447 42,154 47,676 41,490 38,819 33,578 33,664 Unrestricted 38,906 50,744 39,758 15,520 18,402 16,264 17,646 20,124 21,819 25,528 Total governmental activities net position $ 209 925 $ 207 600 $ 218 198 $ 205 696 $ 223 918 $ 247 591 $ 262 213 $ 266 971 $ 275 401 $ 287 610 Business -type activities Net investment in capital assets $ 195,073 $ 253,617 $ 264,727 $ 279,272 $ 279,679 $ 285,912 $ 294,109 $ 304,111 $ 314,523 $ 315,915 Restricted 20,176 19,033 19,438 22,389 22,269 21,238 22,219 18,055 17,558 14,859 Unrestricted 58,850 74,370 71,542 57,367 69,472 76,664 73,126 77,224 76,661 84,097 Total business -type activities net position $ 274 099 $ 347 020 $ 355 707 $ 359 028 $ 371 420 $ 383 814 $ 389 454 $ 399 390 $ 408 742 $ 414 871 Primary government Net investment in capital assets $ 331,071 $ 387,606 $ 403,209 $ 433,001 $ 443,041 $ 469,563 $ 497,186 $ 512,139 $ 534,527 $ 544,333 Restricted 55,197 41,900 59,396 58,836 64,423 68,914 63,709 56,874 51,136 48,523 Unrestricted 97,756 125,114 111,300 72,887 87,874 92,928 90,772 97,348 98,480 109,625 Total primary government net position $ 484 024 $ 554 620 $ 573 905 $ 564 724 $ 595 338 $ 631 405 $ 651 667 $ 666 361 $ 684 143 $ 702 481 ' The City of Iowa City reclassified the Mass Transportation Fund from the General fund to an Enterprise Fund effective the fiscal year ending June 30, 2013. 2 The City of Iowa City reclassified the Cable Fund from an Enterprise Fund to the General Fund effective July 1, 2015. 107 City of Iowa City, Iowa Changes in Net Position Last Ten Fiscal Years (Accrual basis of accounting) (amounts expressed in thousands) 2012 2013' 2014 2015 2016' 2017 2018 2019 2020 2021 Expenses Governmental activities: Public safety $ 21,186 $ 20,989 $ 22,721 $ 21,193 $ 22,029 $ 24,002 $ 25,191 $ 26,265 $ 29,252 $ 30,411 Public works 17,556 10,240 8,258 11,037 10,839 12,032 12,813 16,324 16,071 16,363 Culture and recreation 13,107 14,481 16,586 14,049 14,422 15,525 16,363 16,009 16,233 15,774 Community and economic development 16,305 10,596 10,059 7,093 6,786 8,253 12,019 16,022 9,383 8,549 General government 7,591 7,513 7,687 7,752 6,240 6,124 6,858 7,524 7,693 10,529 Debt service 2,400 2,237 1,797 1,517 1,287 1,481 1,414 1,444 1,452 1,561 Total governmental activities expenses 78,145 66,056 67,108 62,641 61,603 67,417 74,658 83,588 80,084 83,187 Business -type activities: Wastewater 11,069 10,464 21,139 12,131 11,866 11,233 11,392 11,413 10,807 12,520 Water 8,781 9,074 8,723 8,403 8,149 8,921 9,472 9,543 9,302 10,177 Sanitation 8,315 7,279 8,402 8,114 8,735 9,123 9,408 10,858 10,145 10,045 Housing authority 7,911 7,658 7,703 7,873 8,378 8,798 9,535 10,170 10,021 10,141 Parking 4,167 4,579 4,093 4,678 4,460 4,620 5,590 5,461 5,014 4,613 Airport 1,127 1,086 1,209 1,612 1,597 1,402 1,680 1,466 2,511 1,835 Stormwater 1,304 1,318 1,314 2,091 1,989 2,432 1,844 1,832 2,198 2,105 Cable television 689 692 781 704 - - - - - Transit - 6,998 7,795 7,379 7,486 7,263 8,071 8,833 9,041 8,107 Total business -type activities expenses 43,363 49,148 61,159 52,985 52,660 53,792 56,992 59,576 59,039 59,543 Total primary govermnent expenses $ 121 508 $ 115 204 $ 128 267 $ 115 626 $ 114 263 $ 121 209 $ 131 650 $ 143 164 $ 139 123 $ 142 730 Program Revenues Governmental activities: Charges for services Public safety $ 3,401 $ 4,098 $ 3,626 $ 3,926 $ 4,813 $ 5,286 $ 4,438 $ 4,870 $ 4,430 $ 4,277 Public works 1,112 52 61 388 628 724 62 290 243 482 Culture and recreation 825 775 808 801 823 842 836 854 508 322 Community and economic development - - 45 50 1,044 36 441 548 59 1,837 General government 2,817 2,763 3,030 2,975 1,252 1,524 1,520 1,717 1,551 1,582 Operating grants and contributions 8,682 4,731 3,231 8,701 9,941 10,828 10,245 13,758 13,113 12,479 Capital grants and contributions 6,078 6,876 5,580 11,556 3,999 9,952 1,459 1,972 1,915 2,845 Total governmental activities program revenues 22,915 19,295 16,381 28,397 22,500 29,192 19,001 24,009 21,819 23,824 Business -type activities: Charges for services: Wastewater 12,670 12,832 12,559 12,189 12,266 12,277 12,626 12,831 12,357 12,155 Water 8,419 8,583 8,443 8,527 9,134 9,275 9,473 9,640 10,048 9,934 Sanitation 8,115 8,181 8,467 9,015 9,215 9,927 10,014 10,017 10,193 11,944 Housing authority 207 205 213 237 300 321 323 295 280 296 Parking 4,743 5,043 5,294 5,502 5,438 5,453 5,648 5,982 4,354 3,758 Airport 306 314 328 349 333 345 348 361 371 376 Stormwater 811 974 1,093 1,147 1,168 1,544 1,560 1,568 1,730 1,701 Cable Television 824 816 773 750 - - - - - - Transit' - 2,117 2,185 2,289 2,099 2,089 2,216 2,171 1,802 1,385 Capital grants and contributions: Wastewater 3,223 30,181 7,105 1,370 3,415 2,226 1,913 1,827 2,550 1,580 Capital grants and contributions: Water 977 494 539 581 254 869 483 488 965 834 Capital grants and contributions: Sanitation 2 - - - - - 22 13 - - Capital grants and contributions: Airport 1,576 2,452 5,214 137 260 58 49 38 134 267 Capital grants and contributions: Stormwater 436 226 711 792 370 1,251 892 902 876 1,230 Capital grants and contributions: Parking 4 - - - - - - - - - Capital grants and contributions: Transit - 898 243 - 308 395 3,827 - - 77 Operating grants and contributions: Housing authority 6,782 6,968 6,721 7,628 8,318 8,532 9,065 9,443 9,875 9,691 Operating grants and contributions: Water - 442 6 2 - - - - 2 45 Operating grants and contributions: Airport - 11 56 232 128 69 72 14 896 332 Operating grants and contributions: Sanitation - 23 27 25 3 - 3 104 20 18 Operating grants and contributions: Wastewater - - 62 21 - - - - 8 - Operating grants and contributions: Stormwater - 13 13 279 95 - 2 - - - Operating grants and contributions: Parking - - - - - - - - 3 - Operating grants and contributions: Transit - 1,767 2,118 2,082 2,095 2,235 2,088 2,152 3,107 3,016 Total business -type activities program revenues 49,095 82,540 62,170 53,154 55,199 56,866 60,624 57,846 59,571 58,639 Total primary government revenues $ 72 010 $ 101 835 $ 78 551 $ 81 551 $ 77 699 $ 86 058 $ 79 625 $ 81 855 $ 81 390 $ 82 463 Net (Expense) / Revenues Governmental activities $ (55,230) $ (46,761) $ (50,727) $ (34,244) $ (39,103) $ (38,225) $ (55,657) $ (59,579) $ (58,265) $ (59,363) Business -type activities 5,732 33,392 1,011 169 2,539 3,074 3,632 (1,730) 532 (904) Total primary goverment net expense $ (49,498) $ (13,369) $ (49,716) $ (34,075) $ (36,564) $ (35,151) $ (52,025) $ (61,309) $ (57,733) $ (60,267) General Revenues and Other Changes in Net Position Governmental activities: General revenues: Property taxes $ 50,516 $ 51,017 $ 50,551 $ 52,205 $ 53,114 $ 57,649 $ 59,046 $ 61,739 $ 62,846 $ 69,482 Road use tax' 6,394 6,589 6,745 - - - - - - - Local Sales Option tax 8,644 8,858 466 - - - - - - - Other taxes 2,491 2,609 2,778 2,810 2,717 2,802 2,706 2,935 2,696 2,576 Grants and contributions not restricted to specific purposes - - - 1,048 2,080 1,583 1,547 1,552 1,513 1,587 Earnings on investments 1,823 841 973 1,188 1,045 1,397 2,368 3,257 2,585 841 Miscellaneous 4,228 4,390 4,353 5,518 4,464 3,369 3,656 3,329 3,331 3,030 Gain on sale of assets 2,950 1,312 1,651 135 218 2,151 140 186 111 213 Transfers (3,867) (10,485) (6,192) (10,057) (6,395) (7,053) 1,814 (8,661) (6,387) (6,157) Reassignments - - - - 82 - - - - - Totalgovernmentalactivities 73,179 65,131 61,325 52,847 57,325 61,898 71,277 64,337 66,695 71,572 108 (continued) City of Iowa City, Iowa Changes in Net Position (continued) Last Ten Fiscal Years (Accrual basis of accounting) (amounts expressed in thousands) 2012 2013 2014 2015 2 2017 2018 2019 2020 2021 Business -type activities: General revenues: Earnings on investments 813 671 494 707 715 938 1,496 2,166 1,794 426 Gain on sale of assets 336 293 725 856 2,463 69 2,438 1 74 22 Miscellaneous 484 918 265 374 362 1,260 456 838 565 428 Transfers 3,867 10,485 6,192 10,057 6,395 7,053 (1,814) 8,661 6,387 6,157 Reassignments - - - - (82) - - - - - Special items - (574) - Extraordinary items (5,000) Total business -type activities 500 12,367 7,676 11,420 9,853 9,320 2,576 11,666 8,820 7,033 Total primary government $ 73 679 $ 77 498 $ 69 001 $ 64 267 $ 67 178 $ 71 218 $ 73 853 $ 76 003 $ 75 515 $ 78 605 Change in Net Position Governmental activities $ 17,949 $ 18,370 $ 10,598 $ 18,603 $ 18,222 $ 23,673 $ 15,620 $ 4,758 $ 8,430 $ 12,209 Business -type activities 6,232 45,759 8,687 11,589 12,392 12,394 6,208 9,936 9,352 6,129 Total primary government $ 24 181 $ 64 129 $ 19 285 $ 30 192 $ 30 614 $ 36 067 $ 21 828 $ 14 694 $ 17 782 $ 18 338 The City of Iowa City reclassified the Mass Transportation Fund from the General Fund to an Enterprise Fund effective the fiscal year ending June 30, 2013. I The City of Iowa City reclassified the Cable Fund from an Enterprise Fund to the General Fund effective July 1, 2015. 3 The City of Iowa City reclassified Road Use Tax from General Revenues to Operating Grants effective for the fiscal year ending June 30, 2015. 109 City of Iowa City, Iowa Fund Balances, Governmental Funds Last Ten Fiscal Years (Modified accrual basis of accounting) (amounts expressed m thousands) 2012 2013' 2014 2015 20162 2017 2018 2019 2020 2021 General Fund Nonspendable $ 314 $ 69 $ 69 $ 69 $ 69 $ 788 $ 793 $ 887 $ 549 $ 469 Restricted 23,779 25,689 26,533 25,291 18,975 9,974 1,942 1,808 1,747 1,455 Committed - - 4,699 5,199 4,962 - Assigned 5,191 1,744 3,400 - 1,143 1,342 1,437 3,565 5,708 9,883 Reserved - - - 4,483 - - - - - - Unassigned 14,273 17,113 17,907 19,286 23,366 24,793 28,516 34,358 35,369 40,414 Total general fund $ 43,557 $ 44,615 $ 47,909 $ 49,129 $ 48,252 $ 42,096 $ 37,650 $ 40,618 $ 43,373 $ 52 221 All other Governmental Funds Nonspendable $ - $ - $ - $ - $ - $ 344 $ 165 $ 224 $ 278 $ 218 Restricted 34,853 28,108 31,285 27,897 38,266 63,941 64,033 50,966 48,728 51,931 Unassigned (366) (5,844) (9) - - - (38) (59) (611) (27) Total all other governmental funds $ 34,487 $ 22,264 $ 31,276 $ 27,897 $ 38,266 $ 64,285 $ 64,160 $ 51,131 $ 48,395 $ 52,122 1 The City of Iowa City reclassified the Mass Transportation Fund from the General fund to an Enterprise Fund effective the fiscal year ending June 30, 2013. 2 The City of Iowa City reclassified the Cable Fund from an Enterprise Fund to the General Fund effective July 1, 2015. 110 City of Iowa City, Iowa Changes in Fund Balances, Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (amounts expressed in thousands) 2012 20132 2014 2015 20162 2017 2018 2019 2020 2021 Revenues: Property taxes and assessments $ 61,649 $ 62,483 $ 53,797 $ 55,014 $ 55,831 $ 60,452 $ 61,753 $ 64,672 $ 65,542 $ 72,058 Licenses and permits 1,307 1,784 1,660 1,806 3,056 3,521 2,734 2,981 2,352 2,541 Intergovernmental 21,952 19,941 17,636 21,086 20,230 24,140 14,944 16,828 18,603 20,127 Charges for services 2,614 1,800 1,819 2,204 3,357 2,355 2,295 2,690 1,715 3,446 Fines and forfeits - - - - 760 750 695 776 609 375 Use of money and property 1,768 782 909 1,080 946 1,235 1,937 2,564 1,872 773 Miscellaneous 5,750 6,325 6,040 7,045 2,913 2,101 2,875 2,2612,440 2,112 Total govemmental activities revenues $ 95,040 $ 93,115 $ 81,861 $ 88,235 $ 87,093 $ 94,554 $ 87,233 $ 92,772 $ 93,133 $ 101,432 Expenditures Current Public safety $ 20,091 $ 20,648 $ 21,370 $ 21,996 $ 21,701 $ 22,513 $ 23,360 $ 24,295 $ 25,637 $ 26,167 Public works 15,462 8,503 8,432 12,071 9,466 9,186 10,052 10,894 10,586 11,447 Culture and recreation 13,075 13,000 13,087 11,821 12,257 13,341 14,208 13,709 13,653 12,979 Community and economic development 8,037 8,219 8,196 5,711 5,346 7,695 11,074 15,723 8,627 8,305 General government 7,553 7,286 7,184 7,608 6,007 5,882 6,017 6,579 6,789 9,788 Debt service Principal 13,294 16,465 13,560 12,564 13,230 13,305 11,895 12,080 11,385 12,745 Interest 2,543 2,339 1,903 1,669 1,475 1,597 1,570 1,589 1,648 1,905 Capital projects 16,006 17,861 14,528 14,762 14,848 18,405 28,225 22,632 21,211 12,173 Total expenditures $ 96,061 $ 94,321 $ 88,260 $ 88,202 $ 84,330 $ 91,924 $ 106,401 $ 107,501 $ 99,536 $ 95,509 Excess (deficiency) of revenues over (under) expenditures $ (1,021) $ (1,206) $ (6,399) $ 33 $ 2,763 $ 2,630 $ (19,168) $ (14,729) $ (6,403) $ 5,923 Other financing sources (uses): Issuance of long-term debt $ 9,690 $ 2,655 $ 19,730 $ 7,785 $ 9,405 $ 22,570 $ 11,995 $ 12,535 $ 12,145 $ 11,325 Issuance of refunding debt - - - - - - - - - - Sale of capital assets 3,619 1,369 1,684 165 252 2,292 140 758 111 233 Insurance Recoveries 53 - - - - - - - - - Premium (discount) on issuance of bonds 165 (42) 385 199 441 120 236 81 927 1,464 Payment of refunded bonds - - - - - - - - - - Transfers in 19,499 25,198 13,040 13,089 25,133 34,675 34,666 25,663 21,236 21,223 Transfers out (23,181) (35,493) (16,134) (23,430) (28,502) (47,033) (32,440) (34,369) (27,997) (27,593) Total other financing sources (uses) $ 9,845 $ (6,313) $ 18,705 $ (2,192) $ 6,729 $ 12,624 $ 14,597 $ 4,668 $ 6,422 $ 6,652 Net change in fund balances $ 8,824 $ (7,519) $ 12,306 $ (2,159) $ 9,492 $ 15,254 $ (4,571) $ (10,061) $ 19 $ 12,575 Debt service as a percentage of noncapital expenditures Debt services as a percentage of expenditures and transfers 18.6% 24.0% 20.7% 19.8% 21.2% 19.9% 17.1% 15.6% 15.9% 17.1% 13.3% 14.5% 14.8% 12.7% 13.0% 10.7% 9.7% 9.6% 10.2% 11.9% The City of Iowa City reclassified the Mass Transportation Fund from the General fund to an Enterprise Fund effective the fiscal year ending June 30, 2013. 2 The City of Iowa City reclassified the Cable Fund from an Enterprise Fund to the General Fund effective July 1, 2015. 111 City of Iowa City, Iowa General Government Tax Revenues by Source Last Ten Fiscal Years (Modified accrual basis of accounting) (amounts expressed in thousands) Fiscal Local Option Utility Year Property Tax Road Use Tax Hotel/Motel Tax Sales Taxi Franchise Fee Total 2012 51,374 6,394 811 8,644 822 68,045 2013 51,836 6,589 872 8,858 918 69,073 2014 51,331 6,745 967 466 1,031 60,540 2015 53,056 7,231 1,057 - 902 62,246 2016 53,878 8,320 1,079 - 874 64,151 2017 58,375 8,672 1,137 - 939 69,123 2018 59,730 8,427 1,046 - 976 70,179 2019 62,407 8,820 1,302 - 965 73,494 2020 63,523 9,163 1,135 - 884 74,705 2021 70,126 10,077 938 - 994 82,135 1 1% Local Option Sales Tax went into effect 7/1/09 and was effective through 6/30/13. 112 City of Iowa City, Iowa Assessed and Taxable Value of Property Last Ten Fiscal Years Assessed Valuation Tax Collection Year: FY2021 FY2020 FY2019 FY2018 FY2017 FY2016 FY2015 FY2014 FY2013 FY2012 Residential $ 4,958,648,218 $ 4,399,451,083 $ 4,255,597,838 $ 4,001,761,478 $ 3,882,757,454 $ 3,603,743,609 $ 3,488,112,611 $ 3,367,051,717 $ 3,284,249,136 $ 3,182,636,485 Agricultural (taxed at Ag rate) 1,748,000 2,539,080 2,625,810 3,425,692 3,720,671 3,553,520 3,680,920 2,655,640 2,516,440 2,263,884 Multi -Residential 539,636,381 489,176,499 471,420,082 411,460,472 410,426,868 - - - - - Commercial 1,060,943,044 932,699,374 915,964,068 821,949,555 805,734,128 1,129,397,979 1,144,437,631 1,113,600,025 1,149,535,927 1,146,182,052 Industrial 80,663,794 76,905,588 71,553,904 72,635,554 73,206,895 74,399,739 80,153,614 72,834,630 73,400,730 73,044,725 Railroads 4,488,469 3,601,348 3,549,414 3,984,932 4,096,577 4,015,580 3,827,506 3,205,451 2,619,932 1,799,383 Utilities w'out Gas & Electric 6,152,547 7,386,408 7,099,293 6,734,894 7,375,066 8,239,789 9,599,528 10,816,940 11,051,685 10,729,898 Gross valuation 6,652,280,453 5,911,759,380 5,727,810,409 5,321,952,577 5,187,317,659 4,823,350,216 4,729,811,810 4,570,164,403 4,523,373,850 4,416,656,427 Less: Military exemption 2,435,380 2,489,088 2,579,836 2,635,396 2,727,994 2,828,002 2,939,122 3,059,502 3,096,542 3,163,216 Net valuation 6,649,845,073 5,909,270,292 5,725,230,573 5,319,317,181 5,184,589,665 4,820,522,214 4,726,872,688 4,567,104,901 4,520,277,308 4,413,493,211 Incremental value 89,469,635 115,175,495 85,379,709 80,577,275 72,666,677 42,307,287 21,131,574 14,113,908 11,712,327 25,408,838 Gas and Electric Utilities 118,583,613 109,124,421 97,050,716 94,582,279 92,987,351 87,728,294 78,642,915 87,100,183 83,538,109 81,240,051 Total Assessed valuation $ 6,857,898,321 $ 6,133,570,208 $ 5,907,660,998 $ 5,494,476,735 $ 5,350,243,693 $ 4,950,557,795 $ 4,826,647,177 $ 4,668,318,992 $ 4,615,527,744 $ 4,520,142,100 Percent change 11.809% 3.824% 7.520% 2.696% 8.074% 2.567% 3.392% 1.144% 2.110% 1.579% Taxable Valuation Tax Collection Year: FY2021 FY2020 FY2019 FY2018 FY2017 FY2016 FY2015 FY2014 FY2013 FY2012 Assessment Limitation: Residential rollback 55.0743% 56.9180% 55.6209% 56.9391% 55.6259% 55.7335% 54.4002% 52.8166% 50.7518% 48.5299% Agricultural rollback 81.4832% 56.1324% 54.4480% 47.4996% 46.1068% 44.7021% 43.3997% 59.9334% 57.5411% 69.0152% Multi -Residential rollback 71.25% 75.00% 78.75% 82.50% 86.25% NA NA NA NA NA Commercial and Railroad rollback 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 95.0% NA NA NA Industrial rollback 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 95.0% NA NA NA Residential $ 2,719,569,602 $ 2,490,442,298 $ 2,356,529,643 $ 2,274,451,551 $ 2,155,033,296 $ 2,008,493,138 $ 1,894,079,854 $ 1,776,096,066 $ 1,666,036,081 $ 1,544,260,536 Agricultural (taxed at Ag rate) 1,424,328 1,425,151 1,429,547 1,618,090 1,706,955 1,588,496 1,597,501 1,591,636 1,447,988 1,562,422 Multi -Residential 382,070,966 363,613,829 368,969,925 337,946,106 353,335,857 - - - - - Commercial 950,525,463 832,628,954 819,505,276 734,200,396 720,036,878 1,016,458,199 1,086,556,293 1,113,600,025 1,149,535,927 1,146,182,052 Industrial 72,596,824 68,970,889 64,152,540 64,688,055 65,301,535 66,959,765 76,128,877 72,834,630 73,400,730 73,044,725 Railroads 4,039,622 3,241,213 3,194,473 3,586,439 3,686,919 3,614,022 3,636,130 3,205,451 2,619,932 1,799,383 Utilities w'out Gas & Electric 6,152,547 7,386,408 7,099,293 6,734,894 7,375,066 8,239,789 9,599,528 10,816,940 11,051,685 10,729,898 Gross valuation 4,136,379,352 3,767,708,742 3,620,880,697 3,423,225,531 3,306,476,506 3,105,353,409 3,071,598,183 2,978,144,748 2,904,092,343 2,777,579,016 Less: Military exemption 2,435,380 2,489,088 2,579,836 2,635,396 2,727,994 2,828,002 2,939,122 3,059,502 3,096,542 3,163,216 Net valuation 4,133,943,972 3,765,219,654 3,618,300,861 3,420,590,135 3,303,748,512 3,102,525,407 3,068,659,061 2,975,085,246 2,900,995,801 2,774,415,800 Incremental value 84,077,937 115,175,495 85,379,369 80,559,947 72,650,838 33,331,128 21,131,574 14,113,908 11,712,327 25,408,838 Gas and Electric Utilities 40,156,239 42,719,065 41,797,475 41,702,196 44,986,783 46,785,426 47,004,994 46,813,214 47,404,050 48,337,968 Total Taxable Valuation $ 4,258,178,148 $ 3,923,114,214 $ 3,745,477,705 $ 3,542,852,278 $ 3,421,386,133 $ 3,182,641,961 $ 3,136,795,629 $ 3,036,012,368 $ 2,960,112,178 $ 2,848,162,606 Percent change 8.541% 4.743% 5.719% 3.550% 7.501% 1.462% 3.320% 2.564% 3.931% 3.270% Total Direct Tax Rate City of Iowa City Sources: Iowa Department of Management 15.773 $ 15.833 $ 16.183 $ 16.333 $ 16.583 $ 16.651 $ 16.705 $ 16.805 $ 17.269 $ 17.842 Notes: Property is reassessed in the odd numbered years to make adjustments to all property values, according to current market values. As per the Code of Iowa, all real property subject to shall be valued at its actual value and, except as otherwise provided, shall be reassessed at 100% of its actual value. 113 anon City of Iowa City, Iowa Property Tax Rates - Direct and Overlapping Governments Last Ten Fiscal Years (per $1,000 assessed valuation) Fiscal Year: 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 Levy Year: 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 City: General Fund $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 $ 8.10000 Emergency Levy 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.24000 Debt Service Fund 4.64901 4.44287 4.02965 4.12963 3.92833 3.82846 3.57846 3.22846 2.97846 2.57846 Employee Benefits 3.52580 3.19286 3.16331 2.96331 3.11277 3.14415 3.14415 3.34415 3.24415 3.34415 Capital Improvement 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 Other 1.56669 1.53291 1.51226 1.51226 1.50986 1.51044 1.51044 1.51044 1.51044 1.51044 Total City $ 17.84150 $ 17.26864 $ 16.80522 $ 16.70520 $ 16.65096 $ 16.58305 $ 16.33305 $ 16.18305 $ 15.83305 $ 15.77305 Johnson County $ 6.98984 $ 6.74909 $ 6.73712 $ 6.74168 $ 6.90337 $ 6.77140 $ 6.85143 $ 6.53594 $ 6.49278 $ 6.34581 Iowa City Community School District 14.59055 14.07327 13.68792 13.69999 13.86773 13.98935 13.95855 14.85629 14.79097 14.83935 Kirkwood 0.99870 1.07888 1.06473 1.05754 1.06125 1.08048 1.13174 1.20354 1.21331 1.25730 Other 0.33310 0.32919 0.37333 0.32315 0.32784 0.32450 0.33036 0.30557 0.27066 0.33110 Total Tax Rate $ 40.75369 $ 39.49907 $ 38.66832 $ 38.52756 $ 38.81115 $ 38.74878 $ 38.60513 $ 39.08439 $ 38.60077 $ 38.54661 Source: "Tax Levies for Johnson County, Iowa," compiled by the Johnson County Auditor. Note: Does not include the tax rate for agriculture. Taxpayers in the Iowa City Community School District Area 114 City of Iowa City, Iowa Levies and Collections Last Ten Fiscal Years (Cash basis of accounting) (amounts expressed in thousands) Percent of Total as Collection Total Tax Current Tax Levy Delinquent Tax Total Tax a Percent of Year Levied Collections Collected Collections) Collections Levy 2012 49,595 49,543 99.9 1 49,544 99.9 2013 50,407 50,139 99.5 3 50,142 99.5 2014 50,307 49,835 99.1 1 49,836 99.1 2015 51,609 51,292 99.4 3 51,295 99.4 2016 52,034 52,074 100.1 0 52,074 100.1 2017 55,330 55,331 100.0 0 55,331 100.0 2018 56,458 56,346 99.8 1 56,347 99.8 2019 59,174 59,252 100.1 2 59,254 100.1 2020 60,297 58,971 97.8 1 58,972 97.8 2021 65,849 65,656 99.7 1058 66,714 101.3 Source: Certificate of City Taxes and Johnson County Treasurer's Office Note: This schedule is presented on a cash basis of accounting. Taxes are collected by the Johnson County Treasurer and submitted to the City in the following month. Because of the month delay, some years will show Current Tax Collections in excess of the Total Tax Levied. 1 Delinquent tax collection is presented by collection year, rather than levy year, because information is not available from Johnson County Treasurer by levy year. 115 Ten largest taxpayers' Rise at Riverfront Crossing Owner LLC BBCS Hawkeye Housing LLC ACT Inc (Am College Testing Prgrm) Tailwind Iowa City LLC Webber - Iowa LLC Vesper Iowa City LLC Midwestone Bank Mid -American Energy Company Augusta Place LLC Hollingsworth Capital Partners - Iowa Inc Ann Gerdin Trust (formerly Russell Gerdin) SouthGate Development Company MEHSM LC (Sycamore Mall) Alpha Inc. Proctor & Gamble LLC National Computer Systems (Pearson) United Natural Foods CCA: Hawk Ridge Dr LLC Lodge Apts Total Sources: 'City of Iowa City Assessor's Office City of Iowa City, Iowa Principal Taxpayers Current Year and Nine Years Ago (amounts expressed in thousands) Type of Business Real Estate Developer Real Estate Mangment Educational Testing Service Real Estate Mangment Domestic Limited Liability Company Real Estate Developer Finanacial Public Gas and Electric Utility RealEstate Developer RealEstate Developer Warehousing RealEstate Developer Shopping Mall Industrial Manufacturing Company Information Services Wholesale Distribution Company Apartments 116 2012 Taxable Valuation Rank % of Total Taxable Valuation 2021 $ N/A % $ N/A 47,985 1 1.68 N/A N/A N/A N/A 44,301 2 1.56 N/A N/A 20,968 3 0.74 18,273 4 0.64 16,375 5 0.57 16,083 6 0.56 15,086 7 0.53 14,410 8 0.51 12,903 9 0.45 12,052 10 0.42 $ 218,436 Taxable Valuation 55,705 50,166 42,611 42,542 28,279 27,604 27,019 25,546 25,243 24,974 7.66 % $ 349,689 % of Total Taxable Rank Valuation 1 1.31 % 2 1.18 3 1.00 4 1.00 5 0.66 6 0.65 7 0.63 8 0.60 9 0.59 10 0.59 N/A N/A N/A N/A N/A N/A N/A N/A 8.21 % 117 City of Iowa City, Iowa Larger Water System Customers Current Year and Nine Years Ago 2012 2021 Customer Name Charges Rank Percentage Charges Rank Percentage Proctor & Gamble $ 589,583 1 7.41 % $ 739,049 1 7.81 % Veterans Administration Medical Center 108,018 2 1.36 100,143 2 1.06 Mercy Hospital 71,544 3 0.90 78,892 3 0.83 Campus Apartments 62,159 5 0.78 73,955 4 0.78 Tailwind Iowa City LLC formerly Dolphin Lake - - N/A 63,774 5 0.67 Dominium JIT Sry formerly Mark IV Apts 59,404 6 0.75 60,226 6 0.64 Daknoll Retirement Residence - - N/A 43,145 7 0.46 Seville Apts 33,505 9 0.42 39,597 8 0.42 Emerald Court Apts - - N/A 37,789 9 0.40 Rise at Riverfront Crossing - N/A 33,922 10 0.36 Rus Property Management/Lakeside Manor 70,173 4 0.88 - N/A University of Iowa Mayflower 44,794 7 0.56 - - N/A ACT 38,819 8 0.49 - - N/A RBD Iowa City LLC (Sheraton Hotel) 32,246 10 0.41 - - N/A Total Water System Charges Sources: City of Iowa City Revenue Division $ 1,110,245 13.96 % $ 1,270,492 13.43 % $ 7,953,738 $ 9,459,987 118 City of Iowa City Sales History and Water System Charges Last Ten Fiscal Years Fiscal Water Sales Water System Year Cubic Feet Sold Charges 2012 246,618,257 7,953,738 2013 254,616,773 8,194,467 2014 239,790,719 7,778,364 20151 240,423,612 8,161,522 2016 255,524,943 8,758,683 2017 267,511,531 9,156,005 2018 293,046,636 9,953,510 2019 289,055,329 10,139,587 2020 285,102,926 10,705,168 2021 237,035,139 9,459,987 Sources: City of Iowa City Revenue Department Notes: 'Beginning in March 2015, Water Sales by Cubic Feet Sold also includes unbilled usage. City of Iowa City, Iowa Larger Sewer System Charges Current Year and Nine Years Ago 2012 2021 Customer Name Charges Rank Percentage Charges Rank Percentage University of Iowa $ 2,127,659 1 16.69 % $ 1,729,679 1 14.63 % Proctor & Gamble 1,051,742 2 8.25 918,828 2 7.77 Iowa City Landfill 120,138 5 0.94 115,947 3 0.98 Veterans Administration Medical Center 169,399 3 1.33 99,127 4 0.84 Mercy Hospital 122,441 4 0.96 97,216 5 0.82 Campus Apartments 84,386 8 0.66 83,604 6 0.71 Dominium JIT Sry formerly Mark IV Apts 85,055 7 0.67 67,983 7 0.58 Tailwind Iowa City LLC formerly Dolphin Lake 119,505 6 0.94 65,641 8 0.56 Oaknoll Retirement Residence - 0.00 55,115 9 0.47 Seville Apts - 0.00 49,030 10 0.41 University of Iowa/Mayflower Apartments 79,062 9 0.62 - N/A RBD Iowa City LLC (Sheraton Hotel) 56,092 10 0.44 N/A Total Sewer System Charges Sources: City of Iowa City Revenue Department $ 4,015,479 31.50 % $ 3,282,170 27.77 % $ 12,748,321 $ 11,819,500 120 City of Iowa City, Iowa Sales History and Sewer System Charges Last Ten Fiscal Years Fiscal Sewer Sales Sewer System Year Cubic Feet Sold Charges 2012 282,134,840 12,784,321 2013 285,472,392 12,883,641 2014 269,494,125 12,3 82,031 20151 266,830,947 12,278,153 2016 270,547,701 12,022,203 2017 277,712,785 12,404,360 2018 283,246,320 12,524,540 2019 288,537,266 12,822,250 2020 279,106,456 12,503,764 2021 265,605,446 11,819,500 Sources: City of Iowa City Revenue Department Notes: 'Beginning in March 2015, Sewer Sales by Cubic Feet Sold also includes unbilled usage. Governmental Activities City of Iowa City, Iowa Ratios of Outstanding Debt by Type Last Ten Fiscal Years Business -Type Activities General Capital General Total Percentage Fiscal Obligation Revenue Loan Obligation Revenue Capital Primary of Personal Per Year Bonds' Bonds' Note Bonds' Bonds' Lease Government Income' Capita' 2012 74,225,654 210,784 1,483,473 69,059,307 144,979,218 2.05 2,103 2013 57,688,803 2,614,644 210,784 1,182,315 62,764,738 124,461,284 1.70 1,775 2014 64,132,510 2,616,768 210,784 886,157 57,568,517 125,414,736 1.62 1,752 2015 59,421,203 2,618,892 210,784 590,000 45,566,903 108,407,782 1.40 1,475 2016 55,998,392 2,491,016 210,784 295,000 39,951,661 98,946,853 1.23 1,327 2017 52,571,254 15,168,140 210,784 34,420,914 14,482,714 116,853,806 1.34 1,544 2018 52,883,524 15,035,264 210,784 29,095,062 11,958,305 109,182,939 1.18 1,442 2019 53,402,638 14,902,388 210,784 21,155,710 9,413,024 99,084,544 1.03 1,319 2020 55,007,945 14,764,512 210,784 16,786,358 86,769,599 0.87 1,160 2021 56,685,493 12,781,636 210,784 12,242,006 81,919,919 0.80 1,083 Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements. 1 Bonds reported net of related premiums and discounts. 2 Population and personal income information can be found on page 128. 122 City of Iowa City Iowa Ratios of General Obligation Bonded Debt' to Assessed Value and Net Bonded Debt per Capita Last Ten Fiscal Years (amounts expressed in thousands, except per capita) Gross General Less: Debt Net General Net Bonded Debt Net Bonded Fiscal Obligation Service Obligation per $1,000 of Debt Year Bonded Debt 1 Fund Balance Bonded Debt Assessed Value Per Capital 2012 75,709 11,009 64,700 14.31 : 1000 938 2013 58,871 6,527 52,344 11.34:1000 746 2014 65,019 6,872 58,147 12.46:1000 812 2015 60,011 7,052 52,959 10.97:1000 721 2016 56,293 6,573 49,720 10.04:1000 670 2017 52,571 7,756 44,815 8.38:1000 592 2018 52,884 8,609 44,275 8.06:1000 585 2019 53,403 9,648 43,755 7.41 : 1000 582 2020 55,008 9,724 45,284 7.38:1000 605 2021 56,685 7,551 49,134 7.16:1000 649 Notes: 1 General Obligation bonds, net of related premiums and discounts. 2 Population data can be found on page 128. 123 Name of Governmental Unit City of Iowa City2 Iowa City Community School District' 170,605 Johnson County' 31,261 Clear Creek- Amana Community School District' 82,015 0.04 33 Kirkwood Comm. College' 141,210 14.87 20,998 Total Overlapping Debt 425,091 134,883 Total Direct & Overlapping Debt $ 494,769 $ 204,561 City of Iowa City, Iowa Computation of Direct and Overlapping Debt June 30, 2021 (amounts expressed in thousands, except per capita) Total General Percent Amount Long -Term Applicable Applicable Direct Debt to the City of to the City of Outstanding Iowa City Iowa City $ 69,678 100.00 % $ 69,678 58.74 100,213 43.63 13,639 'Long term debt outstanding includes only GO debt. 2Net direct debt includes premiums & discounts Source: Johnson County Auditor's Office. Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of Iowa City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government. 124 City of Iowa City, Iowa Legal Debt Margin Informations Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Total Assessed Valuation $ 4,520,142 $ 4,615,527 $ 4,668,319 $ 4,826,648 $ 4,950,559 $ 5,350,228 $ 5,494,459 $ 5,907,661 $ 6,133,570 $ 6,857,898 Debt Limit 226,007 230,776 233,416 241,332 247,528 267,511 274,723 295,383 306,679 342,895 G.O. Bonds 75,320 58,550 64,420 59,340 55,350 51,645 51,880 52,470 53,370 53,935 TIF Rev. Bonds - 2,655 2,655 2,655 2,525 15,200 15,065 14,930 14,790 12,805 Letters of credit 805 538 1,943 2,005 582 663 475 603 - - Notes payable 211 211 211 211 211 211 211 211 211 211 TIF rebates 574 307 170 18,206 13,506 17,356 25,012 27,954 25,877 36,944 Total net debt applicable to limit 76,910 62,261 69,399 82,417 72,174 85,075 92,643 96,168 94,248 103,895 Legal debt margin $ 149,097 $ 168,515 $ 164,017 $ 158,915 $ 175,354 $ 182,436 $ 182,080 $ 199,215 $ 212,431 $ 239,000 Total net debt applicable to the limit as a percentage of debt limit 34.03% 26.98% 29.73% 34.15% 29.16% 31.80% 33.72% 32.56% 30.73% 30.30% lAs reported in the Annual Financial Report to the State Note: Under Iowa code, the city's outstanding general obligation debt should not exceed 5 percent of total assessed property value. 125 City of Iowa City, Iowa Schedule of Revenue Bond Coverage Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year Net Revenue Annual Debt Service2 Ended Available for Ratio of June 30 Revenue Expenses' Debt Service Principal Interest Total Coveraee Parking Revenue' 2012 4,945 3,034 1,911 500 339 839 2.28 2013 5,122 3,549 1,573 515 324 839 1.87 2014 5,365 2,969 2,396 530 308 838 2.86 20157 5,620 3,828 1,792 540 254 794 2.26 2016 - - 2017 5,531 3,683 1,848 1,015 86 1,101 1.68 2018 5,812 3,790 2,022 524 576 1,100 1.84 2019 6,205 3,724 2,481 545 476 1,021 2.43 20209 4,577 3,476 1,101 567 375 942 1.17 20219 - Wastewater Treatment Revenue4 2012 13,175 5,663 7,512 4,615 1,693 6,308 1.19 2013 13,301 5,340 7,961 4,865 1,547 6,412 1.24 2014 12,835 5,708 7,127 3,250 1,428 4,678 1.52 2015 12,620 6,574 6,046 3,370 1,305 4,675 1.29 2016 12,681 6,513 6,168 3,520 1,175 4,695 1.31 2017 13,383 6,357 7,026 3,625 985 4,610 1.52 2018 13,181 6,622 6,559 3,580 756 4,336 1.51 20198 13,548 6,840 6,708 3,465 539 4,004 1.68 2020 12,917 6,366 6,551 2,510 367 2,877 2.28 2021 12,449 7,874 4,575 2,620 257 2,877 1.59 Water Revenues 20126 8,649 5,653 2,996 1,200 861 2,061 1.45 20136 9,342 6,348 2,994 845 758 1,603 1.87 20146 8,613 5,818 2,795 1,335 650 1,985 1.41 2015 8,715 5,632 3,083 1,380 610 1,990 1.55 2016 9,323 5,387 3,936 1,715 579 2,294 1.72 2017 9,529 6,332 3,197 1,760 524 2,284 1.40 2018 9,838 6,949 2,889 1,455 394 1,849 1.56 2019 10,078 6,888 3,190 1,510 280 1,790 1.78 2020 10,399 6,752 3,647 1,565 238 1,803 2.02 2021 10,048 7,471 2,577 1,630 193 1,823 1.41 Notes: ' Excludes depreciation and interest. 2Includes principal and interest of revenue bonds only. 3 Parking Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total Annual Debt Service" is required to be at least 1.25. 4 Wastewater Treatment Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total Annual Debt Service" is required to be at least 1.10. 5 Water Revenue bonds ratio of "Net Revenue Available for Debt Service" to "Total Annual Debt Service" is required to be at least 1.10. 6 Refunded Revenue Bonds paid are excluded from the principal of Annual Debt Service. 7 Parking Revenue Bonds defeased are excluded from the principal and interest of Annual Debt Service. 8 Debt Service excludes the amount called early of $2,670,000. 9 Parking Capital Lease called early is excluded from the principal and interest of Annual Debt Service. 126 City of Iowa City, Iowa Schedule of TIF Revenue Bond Coverage Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Taxable Year Valuation Available 2012D TIF 2016E TIF Available Ended Available for TIF Tax Increment Revenue Revenue Debt June 30 Certification (1) Tax Rate (2) Revenues (3) Bonds Bonds Total Coverage 2012 105,863 33.01 3,495 2013 109,518 31.86 3,489 2014 110,797 30.37 3,365 75 75 44.66 2015 141,518 29.79 4,215 75 75 55.95 2016 156,898 30.49 4,784 205 205 23.30 2017 195,411 30.41 5,943 204 273 477 12.45 2018 226,439 30.34 6,870 207 384 591 11.61 2019 297,479 29.66 8,822 205 384 589 14.97 2020 341,736 29.93 10,228 207 384 591 17.31 2021 539,721 30.03 16,208 205 384 589 27.52 (1) Total taxable valuation available for certification will decrease in fiscal year 2024-25 due to the retirement of the tax increment of the 2001 Amended portion of the Urban Renewal Area. (2) The tax increment rate in fiscal year 2013-14 reflects the loss of the local school district's instruction support levy (ISPL) of $.12405 due to recent legislative changes. TIF tax rate does not include the SSMID levy rate of $2.00 per $1,000 of value. Starting in fiscal year 2012-13, a portion of the taxable valuation certified will be at the higher rate due to its location in the SSMID. (3) The available tax increment revenues do not reflect an estimate for the portion of the available valuation that would be taxed at the higher SSMID rate. 127 City of Iowa City, Iowa Demographic and Economic Statistics Last Ten Calendar Years Per Capita Calendar Personal Personal Average School Unemployment Retail Year Population Income' Income' Increase Enrollmentz Rate3 Sales° 2012 70,182 7,069,000 44,457 10.89 13,862 4.1 767,122,555 2013 71,454 7,327,594 45,325 1.95 14,057 3.8 793,201,342 2014 72,831 7,762,343 47,345 4.46 14,162 3.5 649,794,164 2015 73,497 8,035,139 48,343 2.11 14,495 2.9 838,853,686 2016 74,587 8,296,973 49,461 2.31 15,186 3.2 853,258,347 2017 75,690 8,713,868 51,198 3.51 15,299 3.0 874,928,988 2018 75,696 9,238,484 54,803 7.04 15,334 2.2 854,538,416 20195 75,130 9,597,499 55,834 1.88 15,619 2.4 865,628,890 20205 74,828 9,921,031 57,716 3.37 15,363 8.4 832,475,900 20215•' 75,651 10,280,531 59,808 3.62 15,636 4.0 616,408,526 Sources and Notes: ' Personal Income and Per Capita Personal Income based on metropolitan Iowa City / Coralville and based on figures from Bureau of Economic Analysis. Personal Income expressed in thousands. 'Iowa City Community School District and local private schools 3Iowa Workforce Development Center Iowa Retail Sales & Use Report, Iowa Department of Revenue and Finance. Fiscal year ending June 30. 'Personal Income for 2019 - 2021 and Per Capita Personal Income for 2020 or 2021 are not available. Amounts projected based on average increase over previous 5 years. 6US Census Bureau Population number is not avaible for 2021. Amounts projected based on an average over previous 9 years' 74th quarter reports were not yet available so amount is only for the first 3 quarters of fiscal year ending June 30. 128 Emolovees City of Iowa City, Iowa Principal Employers Current Year and Nine Years Ago 2012 2021 Emolovees Rank Percentage Emolovees Rank Perge centa University of Iowa 30,804 1 34.2 % 24,733 1 26.0 Iowa City Community School District 1,700 2 1.9 2,578 2 2.7 Veterans Administration Medical Center 1,562 3 1.7 2,012 3 2.1 Hy Vee 1,166 8 1.3 1,327 4 1.4 Proctor and Gamble - - N/A 1,004 5 1.1 Mercy Hospital 1,208 6 1.3 912 6 1.0 City of Iowa City 1,216 5 1.4 840 7 0.9 NCS Pearson 1,200 7 1.3 695 8 0.7 Johnson County - N/A 580 9 0.6 ACT Inc. (formerly American College Testing Program) 1,243 4 1.4 570 10 0.6 System Unlimited 890 9 1.0 N/A Internaltion Automotive Components formerly Lear Corp 785 10 0.9 N/A Total Employees Sources: Iowa City Area Development Group Various Employers 41,774 46.4 % 35,251 37.1 90,000 95,000 129 City of Iowa City, Iowa Full-time Equivalent City Government Employees by Function Last Ten Fiscal Years Full -Time Equivalent Employees as of June 30 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Public Safety Police 97 103 105 105 105 105 105 107 107 109.26 Animal Shelter' 6 - - - - - - Fire 65 65 65 64 64 64 64 64 64 64 Inspection Services 15.55 15.55 13.55 13.55 12.85 13.5 13.5 15.6 15.6 17.6 Public Works Public Works Admin 2 2 2 2 2 2 2 2 2 2 Engineerings 12.1 12.1 12.1 12.1 12 16 16 16 16 18 Flood Recovery 0.4 0.4 0.38 - - - - Culture and Recreation Parks and Rec Admin 2 2 2 2 2 2 2 2 2 2 Recreation 15.42 15.42 15.42 15.42 14.42 15.42 14.75 14 14.5 14.5 Parks 13 13 13 13 13 16 16 16 16 16 Forestry 3 3 3 3 3 3 3 5 5 7 Cemetery 3 3 3 3 3 3 3 3 3 3 CBD Maintenance 3 3 3 3 3 - - Library 43.64 43.63 45.13 45.13 44.77 46.17 46.17 46.17 46.05 45.92 Senior Center 6.5 6.5 6.5 6.5 6.5 7 7 7 7 7.76 Community and Economic Development 9.1 8.4 8.95 8.95 10.8 12.63 13.13 13.13 13.13 12.13 Economic Development 1 1 1 1 2 1 1 1 1 1 General Govemment City Council 7 7 7 7 7 7 7 7 7 7 City Clerk 4 4 4 4 4 4 4 4 4 4 City Attorney 5.6 5.6 5.6 5.6 5.5 5.5 5.5 5.5 5.5 5.5 City Manager 3 5 6 6 10.5 10.5 9 9 9 13.89 Personnel 4 4 3 3 3 3 3 3 3 3 Human Rights 2.5 2 2 2 2 2 2 2 2 2 Finance 27.53 23.47 23.97 22.47 23.07 23.13 22.13 22.28 22.28 22.28 Govemment Buildings 4.83 4.83 4.83 4.83 5.33 4.33 5 4 5 4 Transit3 56.25 - - - Special Revenue Employee Benefits 0.55 0.55 0.55 0.55 0.55 0.55 0.55 0.55 0.55 0.55 Flood Mitigation Grants 1.6 - - - - Community Development 3.83 3.33 2.98 2.98 2.83 - - UniverCity Program 0.2 - - - - - - - Traffic Engineering 4.15 4.15 4.15 4.15 3.9 4.5 3 3 3 3 Streets 25.5 25.5 25.5 25.5 25.25 25.5 29 29 29 29 MPOJC (formerly JCCOG) 6.6 5.6 5.6 5.6 4.7 4.7 4.7 5.2 5.2 5.2 Other Shared Revenues 1.6 1.62 - - - - Library Development 1 1 - - - Capital Projects Administrations 5 6 6 5 4 - Internal Service Funds Information Technology 11.8 10.86 9.86 9.86 9.86 9.8 10.8 9.8 9.8 9.8 Equipment 11.26 10.75 10.75 10.75 10.75 10.75 10.75 10.75 10.75 11.75 Central Services 0.75 0.76 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 Risk Management 1.8 1.8 1.8 1.8 1.8 1.8 1.8 1.8 1.8 1.8 Business -Type Activities Parking 32.75 29.25 26.25 26.25 23.13 21.63 21.63 21.38 19.63 21.38 Mass Transit3 - 51.75 51.25 51.25 51.13 53.63 54.63 53.38 53.38 54.13 Wastewater Treatment 25.4 25.4 24.4 24.65 24.65 25.4 26 26 26 26 Water 32.75 32.75 31.75 32 32 31.75 31.75 31.75 31.75 31.25 Sanitation 37.85 37.85 35.85 35.85 33.35 31.5 31.5 32.76 34.76 35.26 Airport 1.75 1 1 1 1 1 1 1 1 1 Cable Television° 6.63 6.63 6.63 5.63 - - - Stormwater 2.1 2.1 2.1 2.6 2.6 2.1 1.5 1.5 2.5 2 Housing Authority 13.25 13.18 12.19 10.19 10.19 9.6 9.6 9.5 9.5 10.62 Total 637.74 623.91 615.16 607.66 598.93 599.89 601.89 605.55 608.18 624.08 Source: City's Financial Plan ' Beginning in FY13, Animal Services is reported under Police 2 Beginning in FY13, Communications Division has been moved from Finance to City Manager 3 Beginning in FY13, Transit was moved from the General Fund to an Enterprise Fund ° Beginning in FY 16, Cable was moved from an Enterprise Fund to the General Fund 5 Beginning in FY17, Capital Project Administration was moved to Engineering 130 City of Iowa City, Iowa Operating Indicators by Function Last Ten Fiscal Years 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Public Safety Police' Physical arrests 5,911 4,468 6,192 5,595 5,465 4,482 4,488 5,212 2,891 2,693 Traffic Violations 3,761 2,499 3,718 3,356 2,989 2,246 3,103 3,422 1,052 1,201 Fire' Number of calls answered 5,173 4,713 5,828 6,016 6,974 6,749 7,122 7,532 6,979 6,299 Inspections conducted 1,970 1,431 2,032 1,903 2,459 874 1,031 1,300 181 873 Parking Parking Violations 96,117 88,909 60,680 65,196 57,549 62,930 50,346 61,330 48,042 45,727 Wastewater Treatment Daily average treatment in million gallons 8.28 9.84 10.02 9.76 10.48 8.32 7.77 10.97 8.58 7.93 Maximum daily capacity of plant in million gallons 41.1 41.1 41.1 43.3 43.3 43.3 43.3 43.3 43.3 43.3 Number of sewer system customers 23,529 24,059 24,389 24,533 25,085 25,485 26,069 26,270 26,576 26,892 Water Daily average consumption in million gallons 5.49 5.54 5.64 5.33 5.32 5.50 5.84 5.69 5.33 5.57 Maximum daily capacity of plant in million gallons 16.7 16.7 16.7 16.7 16.7 16.7 16.7 16.7 16.7 16.7 Customers by Classification Residential 24,086 24,442 24,790 23,089 23,638 24,025 24,595 24,818 25,133 25,452 Commercial 1,489 1,491 1,491 1,409 1,415 1,425 1,436 1,431 1,448 1,448 Industrial 15 15 15 14 14 14 15 15 15 15 Other 200 204 202 135 131 134 136 139 138 137 Total Customers 25,790 26,152 26,498 24,647 25,198 25,598 26,182 26,403 26,734 27,052 Sanitation Number of Customers 15,030 15,177 15,331 14,811 15,620 15,917 15,960 16,112 16,180 16,330 Tonnage 8,935 8,956 9,160 9,210 9,476 9,623 9,694 8,989 9,682 10,339 Landfill Tonnage 148,953 111,445 115,624 123,692 126,875 137,025 140,658 127,587 128,210 151,823 Sources: Various city divisions. Notes: 1 Numbers are based on a calendar year and 2021 figures are compiled through 10/11/21 for FIRE and 10/11/21 for Police. 131 City of Iowa City, Iowa Capital Assets by Function Last Ten Fiscal Years 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Public Safety Police Stations 1 1 1 1 1 1 1 1 1 1 Patrol units 18 18 20 20 20 24 23 23 23 23 Fire Stations 4 4 4 4 4 4 4 4 4 4 Fire apparatus 11 11 11 11 10 10 10 10 10 10 Public Works Streets Miles 275 276 279 281 283 286 288 292 293 295 Street lights 3,412 3,412 3,412 3,412 3,412 3,412 3,307 3,166 3,202 3,246 Culture and Recreation Library 1 1 1 1 1 1 1 1 1 Cemetery 1 1 1 1 1 1 1 1 1 1 Acreage 40 40 40 40 40 40 40 40 40 40 Parks 41 42 43 46 46 49 50 51 56 56 Acreage 1,441 1,506 1,897 1,897 1,902 1,932 1,942 1,947 1,950 1,980 Recreation Recreation centers 2 2 2 2 2 2 2 2 2 2 Swimming pools 3 3 3 3 3 3 3 3 3 3 Ball diamonds 30 27 27 27 27 27 27 27 27 27 Tennis courts 12 12 12 12 12 9 9 9 9 9 Soccer fields 20 20 20 20 20 20 20 20 20 20 Pickle Ball Courts 8 8 8 8 8 Futscal Courts 2 2 2 2 2 Full Basketball Courts - - - - - 3 3 3 6 6 Gaga Pits 2 2 2 2 Boccce Court 1 Parking Facilities 5 5 5 5 5 6 6 6 6 6 Spaces 3,086 3,086 3,086 3,086 3,086 3,686 3,686 3,686 3,686 3,686 Wastewater Treatment Miles of sanitary sewer 294 295 298 300 301 304 306 307 308 310 Miles of storm sewer 127 128 131 133 136 139 140 142 144 146 Number of treatment plants 2 2 1 1 1 1 1 1 1 1 Number of service connectors 23,529 23,851 24,175 24,533 25,085 25,485 26,069 26,270 26,576 26,892 Water Miles of water mains 266 268 271 273 275 277 279 281 283 286 Number of city owned fire hydrants 2,735 3,330 3,385 3,415 3,447 3,503 3,529 3,564 3,611 3,647 Sanitation Landfills 1 1 1 1 1 I 1 I 1 1 Acreage 411 411 411 418 418 418 418 418 418 418 Sources: Various city divisions. 132 Compliance Section Tab BBohnsack & Frommelt LLP Certified Public Accountants Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards To the Honorable Mayor and Members of City Council City of Iowa City, Iowa Iowa City, Iowa We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Iowa City, Iowa, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City's basic financial statements and have issued our report thereon dated December 3, 2021. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered City of lowa City, Iowa's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of City of Iowa City, Iowa's internal control. Accordingly, we do not express an opinion on the effectiveness of City of Iowa City, Iowa's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. 133 Compliance and Other Matters As part of obtaining reasonable assurance about whether City of Iowa City, Iowa's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Comments involving statutory and other legal matters about the City's operations for the year ended June 30, 2021 are based exclusively on knowledge obtained from procedures performed during our audit of the financial statements of the City. Since our audit was based on tests and samples, not all transactions that might have had an impact on the comments were necessarily audited. The comments involving statutory and other legal matters are not intended to constitute legal interpretations of those statutes. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City of Iowa City, Iowa's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City of Iowa City, Iowa's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. eidulA4tzt ; "Ant-intl6 La' Moline, Illinois December 3, 2021 134 BBohnsack & Frommelt LLP Certified Public Accountants Independent Auditor's Report on Compliance For Each Major Federal Program and On Internal Control Over Compliance Required By the Uniform Guidance To the Honorable Mayor and Members of City Council City of Iowa City, Iowa Iowa City, Iowa Report on Compliance for Each Major Federal Program We have audited City of Iowa City, Iowa's compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of City of Iowa City, Iowa's major federal programs for the year ended June 30, 2021. City of Iowa City, Iowa's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. Management's Responsibility Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs. Auditor's Responsibility Our responsibility is to express an opinion on compliance for each of City of Iowa City, Iowa's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about City of Iowa City, Iowa's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of City of Iowa City, Iowa's compliance. Opinion on Each Major Federal Program In our opinion, City of Iowa City, Iowa complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021. 135 Report on Internal Control Over Compliance Management of City of Iowa City, Iowa is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered City of Iowa City, Iowa's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of City of Iowa City, Iowa's internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. 30-Aisd.dtt, 4 4v-IxdniA La7 Moline, Illinois December 3, 2021 136 City of Iowa City, Iowa Schedule of Expenditures of Federal Awards Year Ended June 30, 2021 Assistance Pass -Through Passed Total Federal Grantor/Pass-Through Grantor/ Listing Entity Identifying Through to Federal Program Title or Cluster Title Number Number Subrecipients Expenditures U.S. Department of Housing and Urban Development Direct: Community Development Block Grants (CDBG)/ Entitlement Grants Cluster: CDBG/Entitlement Grants 14.218 B -19 -MC -19-0009 $ 172,725 $ 401,898 CDBG/Entitlement Grants 14.218 B -20 -MC -19-0009 45,388 225,971 CDBG/Entitlement Grants 14.218 B -20 -MW -19-0009 623,299 764,545 Subtotal CDBG/Entitlement Grants Cluster 841,412 1,392,414 Home Investment Partnerships Program Home Investment Partnerships Program Home Investment Partnerships Program 14.239 M -18 -MC -190205 14.239 M -19 -MC -190205 14.239 M -20 -MC -190205 8,034 3,696 197,621 15,307 38,834 227,216 209,351 281,357 Public and Indian Housing 14.850 IA022-00000120D 89,004 Public and Indian Housing 14.850 IA022-00000221D 7,864 Public and Indian Housing 14.850 IA022-00000121 D 129,317 COVID-19 Public and Indian Housing 14.850 IA022-00000120DC 15,490 Public and Indian Housing 14.850 IA022-00000119D 155 241,830 Housing Voucher Program Cluster: Section 8 Housing Choice Vouchers 14.871 IA022EP 27,600 COVID-19 Section 8 Housing Choice Vouchers 14.871 IA022AF 208,982 Section 8 Housing Choice Vouchers 14.871 IA022V0 - 8,883,733 Mainstream Vouchers Mainstream Vouchers 9,120,315 14.879 IA0228FR121 7,733 14.879 IA022DV0001 - 96,461 104,194 Subtotal Housing Voucher Program Cluster 9,224,509 Public Housing Capital Fund Public Housing Capital Fund Indirect: Pass-through Iowa Economic Development Authority, COVID-19 Community Development Block Grants Total U.S. Department of Housing and Urban Development U.S. Department of Justice Direct: COVID-19 Corona Virus Emergency Supplemental Funding Program Bulletproof Vest Partnership Program Bulletproof Vest Partnership Program (Continued) 14.872 IA05P022501-19 14.872 IA05P022501-20 101,255 123,028 224,283 14.228 20-CVE-005 344,057 1,050,763 11,708,450 16.034 2020 -VD -BX -1235 20,109 16.607 2019-BUBX19096333 - 6,052 16.607 2020-BUBX20023173 8,132 137 14,184 City of Iowa City, Iowa Schedule of Expenditures of Federal Awards (Continued) Year Ended June 30, 2021 Assistance Pass -Through Passed Total Federal Grantor/Pass-Through Grantor/ Listing Entity Identifying Through to Federal Program Title or Cluster Title Number Number Subrecipients Expenditures U.S. Department of Justice (Continued) Indirect: Pass-through Iowa Department of Justice: Violence Against Women Formula Grants 16.588 VW -21 -42 -LE $ - $ 69,172 Violence Against Women Formula Grants 16.588 VW -20 -42 -LE 5,813 Pass-through Iowa Governor's Office of Drug Control Policy: Public Safety Partnership and Community Policing Grants 16.710 18 -CAMP -06 Public Safety Partnership and Community Policing Grants 16.710 19 -CAMP -06 Public Safety Partnership and Community Policing Grants 16.710 18 -COPS Heroin -03 Public Safety Partnership and Community Policing Grants 16.710 19 -COPS Heroin -03 Edward Byrne Memorial Justice Assistance Grant Total U.S. Department of Justice U.S. Department of Transportation Direct: Airport Improvement Program Airport Improvement Program Airport Improvement Program Airport Improvement Program Airport Improvement Program COVID-19 Airport Improvement Program Federal Transit Cluster: Federal Transit -Formula Grants COVID-19 Federal Transit -Formula Grants Federal Transit -Formula Grants Subtotal Federal Transit Cluster Indirect: Pass-through Iowa Department of Transportation: Highway Planning and Construction Program Cluster: Highway Planning and Construction Program Highway Planning and Construction Program Highway Planning and Construction Program Highway Planning and Construction Program (Continued) 74,985 2,538 2,655 2,242 3,793 3,361 1,421 5,991 7,435 14,566 16.738 18 -JAG -343666 66,666 100,000 20.106 3-19-0047-028-2020 20.106 3-19-0047-031-2021 20.106 3-19-0047-025-2019 20.106 3-19-0047-026-2019 20.106 3-19-0047-027-2020 20.106 3-19-0047-032-2021 20.507 2019-004-01-FY19 20.507 IA -2020-029-01-00 20.507 IA -2021-011-01-00 20.205 BROS-3715(663)- -8J-52 20.205 BROS-3715(664)- -8J-52 20.205 NHSX-001-5(120)- -3H-52 20.205 STP -U-3715(666)- -70-52 138 74,101 223,844 88,554 222,962 (2,823) (4,015) 164,009 23,000 491,687 77,200 400,000 1,810,347 2,287,547 767,940 70,620 430,526 271,628 1,540,714 City of Iowa City, Iowa Schedule of Expenditures of Federal Awards (Continued) Year Ended June 30, 2021 Federal Grantor/Pass-Through Grantor/ Program Title or Cluster Title U.S. Department of Transportation (Continued) Indirect: Pass-through Iowa Department of Transportation and Metropolitan Planning Organization of Johnson County: Highway Planning and Construction Program Cluster: Highway Planning and Construction Program Subtotal Highway Planning and Construction Program Cluster Metropolitan Transportation Planning and State and Non - Metropolitan Planning and Research Pass-through Iowa Department of Transportation: Transit Services Programs Cluster: Enhanced Mobility of Seniors and Individuals with Disabilities Enhanced Mobility of Seniors and Individuals with Disabilities Subtotal Transit Services Programs Cluster Pass-through Iowa Department of Public Safety/ Governor's Traffice Safety Bureau Highway Safety Cluster: State and Community Highway Safety State and Community Highway Safety National Priority Safety Programs Subtotal Highway Safety Cluster Total U.S. Department of Transportation U.S. Department of the Treasury Indirect: Pass-through Iowa Department of Revenue: COVID-19-Coronavirus Relief Fund U.S. Department of Homeland Security Indirect: Pass-through Iowa Homeland Security and Emergency Management: COVID-19 Disaster Grants- Public Assistance (Presidentially Declared Disaster) Disaster Grants- Public Assistance (Presidentially Declared Disaster) Total U.S. Department of Homeland Security Total Expenditures of Federal Awards Assistance Listing Number Pass -Through Entity Identifying Number Passed Through to Subrecipients Total Federal Expenditures See Notes to the Schedule of Expenditures of Federal Awards. 20.205 20.505 20.513 21MPO-MPOJC $ 21 MPO-MPOJC 2021-018-00-FY21 20.513 2020-001-00-SFY21 20.600 20.600 20.616 PAP 21-402-MOPT, Task 19 PAP 20-402-MOPT, Task 18 PAP20-405b-M1 HVE 21.019 CARES Act Funding 97.036 97.036 139 FEMA DR 4483 -IA FEMA DR 4457 -IA - $ 181,536 1,722,250 48,464 19,816 233,124 252,940 23,838 17,483 41,321 5,000 46,321 4,849,209 138,061 (70,078) 61,018 (9,060) $ 1,124,864 $ 16,910,504 City of Iowa City, Iowa Notes to the Schedule of Expenditures of Federal Awards Year Ended June 30, 2021 Note 1. Basis of Presentation The accompanying schedule of expenditures of federal awards (schedule) includes the federal grant activity of the City under programs of the federal government for the year ended June 30, 2021. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net position or cash flows of the entity. Note 2. Summary of Significant Accounting Policies Expenditures reported on the schedule are reported on the modified accrual basis of accounting for governmental funds and accrual basis of accounting for proprietary funds. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Expenditures of federal awards are recognized in the accounting period when the liability is incurred and has met the eligibility criteria of the federal grant. Revenue from federal awards is recognized when the City has done everything necessary to establish its right to the revenue. In the governmental funds, revenue from federal grants is recognized when the revenue is both measurable and available. In proprietary funds, revenue from federal grants is recognized when it is earned. Pass-through entity identifying numbers are presented where available. Note 3. Indirect Cost Rate The City has not elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. Note 4. Donated Personal Protective Equipment (Unaudited) The City received approximately $29,750 of donated personal protective equipment during the year ended June 30, 2021. 140 City of Iowa City, Iowa Schedule of Findings and Questioned Costs Year Ended June 30, 2021 I. Summary of the Independent Auditor's Results Financial Statements Type of auditor's report issued: Internal control over financial reporting: • Material weakness(es) identified? • Significant deficiency identified? • Noncompliance material to financial statements noted? Federal Awards Internal control over major programs: • Material weakness(es) identified? • Significant deficiency identified? Type of auditor's report issued on compliance for major programs: • Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)? Identification of major programs: CFDA Number Name of Federal Program or Cluster 14.228 COVID-19 Community Development Block Grants Housing Voucher Program Cluster: 14.871 Section 8 Housing Choice Vouchers 14.871 COVID-19 Section 8 Housing Choice Vouchers 14.879 Mainstream Vouchers Unmodified ❑ Yes p No ❑ Yes p None Reported ❑ Yes 2 No ❑ Yes No ❑ Yes p None Reported Unmodified LI Yes 0 No Dollar threshold used to distinguish between type A and type B programs: $750,000 Auditee qualified as low-risk auditee? p Yes ❑ No (Continued) 141 City of Iowa City, Iowa Schedule of Findings and Questioned Costs (Continued) Year Ended June 30, 2021 II. Findings Relating to the Basic Financial Statements as Required to be Reported in Accordance with Generally Accepted Government Auditing Standards A. Internal Control No matters reported. B. Instances of Noncompliance No matters reported. III. Findings and Questioned Costs for Federal Awards A. Internal Control for Federal Awards No matters reported. B. Instances of Noncompliance No matters reported. IV. Other Findings Related to Required Statutory Reporting IV -A-21 Certified Budget — Finding: The City over expended the debt service function amended budget by approximately $132,000. Recommendation: The certified budget should be amended in accordance with Chapter 24.0 of the Code of Iowa before expenditures are allowed to exceed the budget. Response and Corrective Action Plan: The City will amend future budgets in sufficient amounts to ensure the certified budget is not exceeded. IV -B-21 Questionable Expenditures — No expenditures were noted that we believe may not meet the requirements of public purpose as defined in an Attorney General's opinion dated April 25, 1979. IV -C-21 Travel Expenses — No expenditures of City money for travel expenses of spouses of City officials or employees were noted. IV -D-21 Business Transactions — No business transactions between the City and City officials or employees were noted. IV -E-21 Restricted Donor Activity— No transactions were noted between City, City officials, City employees and restricted donors in compliance with Chapter 68B of the Code of Iowa. IV -F-21 Bond Coverage — Surety bond coverage of City officials and employees is in accordance with statutory provisions. The amount of coverage should be reviewed annually to ensure that the coverage is adequate for current operations. IV -G-21 Council Minutes — No transactions requiring Council approval which had not been approved by the Council were noted. IV -H-21 Deposits and Investments — No instances of noncompliance 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. (Continued) 142 City of Iowa City, Iowa Schedule of Findings and Questioned Costs (Continued) Year Ended June 30, 2021 IV -I-21 Revenue Notes — There were no instances of noncompliance with revenue note provisions. IV -J-21 Annual Urban Renewal Report — The annual urban renewal report was properly approved and certified to the Iowa Department of Management on or before December 1. IV -K-21 Payment of General Obligation Bonds — The City appears to be in compliance with Chapter 384.4 of the Code of Iowa. 143 City of Iowa City, Iowa Corrective Action Plan Year Ended June 30, 2021 1 VIII MOM 6 lb CITY OF IOWA CITY 410 East Washlnstfln Slrccl Iorra City, Iowa 52240-1626. W91336-5000 13191 356-5009 FAX www.Icbov.org Findings Corrective Action Plan Anticipated Date of Completion and Responsible Contact Person Findings Related to Required Statutory Reporting; IV -A-21 Expenditures in the debt service function exceeded the amended budget. See response and corrective Fiscal Year 2022 action plan at IV -A-21. Director of Finance 144 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 APPENDIX B DESCRIBING BOOK -ENTRY -ONLY ISSUANCE 1. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the Bonds (the "Securities"). The Securities will be issued as fully -registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully - registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. 2. DTC, the world's largest securities depository, is a limited -purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non -U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post -trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book -entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non -U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non -U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a S&P Global Ratings rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. 3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC's records. The ownership interest of each actual purchaser of each Security ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book -entry system for the Securities is discontinued. 4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. B-1 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. 6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. 7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). 8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from the City or the Paying Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Paying Agent, or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the City or the Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 9. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to any Tender/Remarketing Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant's interest in the Securities, on DTC's records, to any Tender/Remarketing Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC's records and followed by a book - entry credit of tendered Securities to any Tender/Remarketing Agent's DTC account. 10. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to the City or the Paying Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. 11. The City may decide to discontinue use of the system of book -entry -only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. 12. The information in this section concerning DTC and DTC's book -entry system has been obtained from sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof. B-2 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 APPENDIX C DRAFT FORM OF BOND COUNSEL OPINION AHLERS COONEY ATTORNEYS DRAFT Ahlers & Cooney, P.C. Attorneys at Law 100 Court Avenue, Suite 600 Des Moines, Iowa 50309-2231 Phone: 515-243-7611 Fax: 515-243-2149 www.ahlerslaw.com We hereby certify that we have examined a certified transcript of the proceedings of the City Council and acts of administrative officers of the City of Iowa City, State of Iowa (the "Issuer"), relating to the issuance of General Obligation Bonds, Series 2022, by said City, dated 2022, in the denomination of $5,000 or multiples thereof, in the aggregate amount of $ (the "Bonds"). We have examined the law and such certified proceedings and other papers as we deem necessary to render this opinion as bond counsel. As to questions of fact material to our opinion, we have relied upon representations of the Issuer contained in the resolution authorizing issuance of the Bonds (the "Resolution") and in the certified proceedings and other certifications of public officials furnished to us, without undertaking to verify the same by independent investigation. Based on our examination and in reliance upon the certified proceedings and other certifications described above, we are of the opinion, under existing law, as follows: 1. The Issuer is duly created and validly existing as a body corporate and politic and political subdivision of the State of Iowa with the corporate power to adopt and perform the Resolution and issue the Bonds. 2. The Bonds are valid and binding general obligations of the Issuer. 3. All taxable property in the territory of the Issuer is subject to ad valorem taxation without limitation as to rate or amount to pay the Bonds. Taxes have been levied by the Resolution for the payment of the Bonds and the Issuer is required by law to include in its annual tax levy the principal and interest coming due on the Bonds to the extent the necessary funds are not provided from other sources. 4. Interest on the Bonds is excludable from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax. The opinion set forth in the preceding sentence is subject to the condition that the Issuer comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to the issuance of the Bonds in order that the interest thereon be, and continue to be, excludable from gross income for federal income tax purposes. The Issuer has covenanted to comply with all such requirements. Failure to comply with certain of such requirements may cause interest on the Bonds to be included in gross income for federal income tax purposes retroactively to the date of issuance of the Bonds. We express no opinion regarding the accuracy, adequacy, or completeness of the Official Statement or other offering material relating to the Bonds. Further, we express no opinion Wishard & Baily - lees, Guernsey & Baily - 1893, Baily & Stipp - 1901, Stipp, Perry, Bannister & Starzinger - 1914, Bannister, Carpenter, Ahlers & Cooney - 1950, Ahlers, Cooney, Dorweiler, Allbee, Haynie & Smith -1974, Ahlers, Cooney, Dorweiler, Haynie, Smith & Allbee, P.C. -1990 C-1 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 DRAFT City of Iowa City, State of Iowa $ General Obligation Bonds, Series 2022 Page 2 regarding tax consequences arising with respect to the Bonds other than as expressly set forth herein. The rights of the owners of the Bonds and the enforceability of the Bonds are limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights generally, and by equitable principles, whether considered at law or in equity. This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur. Respectfully submitted, 02033854-1\10714-139 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 APPENDIX D DRAFT CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the City of Iowa City, State of Iowa (the "Issuer"), in connection with the issuance of $ General Obligation Bonds, Series 2022 (the "Bonds") dated , 2022. The Bonds are being issued pursuant to a Resolution of the Issuer approved on May 17, 2022 (the "Resolution"). The Issuer covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate; Interpretation. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the Holders and Beneficial Owners of the Bonds and in order to assist the Participating Underwriters in complying with S.E.C. Rule 15c2 -12(b)(5). This Disclosure Certificate shall be governed by, construed and interpreted in accordance with the Rule, and, to the extent not in conflict with the Rule, the laws of the State. Nothing herein shall be interpreted to require more than required by the Rule. Section 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: "Annual Financial Information" shall mean financial information or operating data of the type included in the final Official Statement, provided at least annually by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income tax purposes. "Business Day" shall mean a day other than a Saturday or a Sunday or a day on which banks in Iowa are authorized or required by law to close. "Dissemination Agent" shall mean the Issuer or any Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation. "Financial Obligation" shall mean a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term Financial Obligation shall not include municipal securities as to which a final official statement has been provided to the MSRB consistent with S.E.C. Rule 15c2-12. "Holders" shall mean the registered holders of the Bonds, as recorded in the registration books of the Registrar. "Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate. "Municipal Securities Rulemaking Board" or "MSRB" shall mean the Municipal Securities Rulemaking Board, 1300 I Street NW, Suite 1000, Washington, DC 20005. "National Repository" shall mean the MSRB's Electronic Municipal Market Access website, a/k/a "EMMA" (emma.msrb.org). "Official Statement" shall mean the Issuer's Official Statement for the Bonds, dated , 2022. "Participating Underwriter" shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds. D-1 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 "Rule" shall mean Rule 15c2-12 adopted by the Securities and Exchange Commission (S.E.C.) under the Securities Exchange Act of 1934, and any guidance and procedures thereunder published by the S.E.C., as the same may be amended from time to time. "State" shall mean the State of Iowa. Section 3. Provision of Annual Financial Information. a) The Issuer shall, or shall cause the Dissemination Agent to, not later than two hundred ten (210) days after the end of the Issuer's fiscal year (presently June 30th), commencing with information for the 2021/2022 fiscal year, provide to the National Repository an Annual Financial Information filing consistent with the requirements of Section 4 of this Disclosure Certificate. The Annual Financial Information filing must be submitted in such format as is required by the MSRB (currently in "searchable PDF" format). The Annual Financial Information filing may be submitted as a single document or as separate documents comprising a package. The Annual Financial Information filing may cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Financial Information filing and later than the date required above for the filing of the Annual Financial Information if they are not available by that date. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(c). b) If the Issuer is unable to provide to the National Repository the Annual Financial Information by the date required in subsection (a), the Issuer shall send a notice to the Municipal Securities Rulemaking Board, if any, in substantially the form attached as Exhibit A. c) The Dissemination Agent shall: i. each year file Annual Financial Information with the National Repository; and ii. (if the Dissemination Agent is other than the Issuer), file a report with the Issuer certifying that the Annual Financial Information has been filed pursuant to this Disclosure Certificate, stating the date it was filed. Section 4. Content of Annual Financial Information. The Issuer's Annual Financial Information filing shall contain or incorporate by reference the following: a) The last available audited financial statements of the Issuer for the prior fiscal year, prepared in accordance with generally accepted accounting principles promulgated by the Financial Accounting Standards Board as modified in accordance with the governmental accounting standards promulgated by the Governmental Accounting Standards Board or as otherwise provided under State law, as in effect from time to time, or, if and to the extent such financial statements have not been prepared in accordance with generally accepted accounting principles, noting the discrepancies therefrom and the effect thereof. If the Issuer's audited financial statements for the preceding years are not available by the time Annual Financial Information is required to be filed pursuant to Section 3(a), the Annual Financial Information filing shall contain unaudited financial statements of the type included in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Financial Information when they become available. b) A table, schedule or other information prepared as of the end of the preceding fiscal year, of the type contained in the final Official Statement under the captions: • Debt Limit. • Direct Debt. • General Obligation Debt. • Statement of Bonded Indebtedness. • Other Obligations. D-2 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 • Percentages for Taxable Valuation After Rollbacks. • Building Permits. • Property Valuations and Trend of Valuations -Actual (100%) Valuations for the City. • Property Valuations and Trend of Valuations -Taxable ("Rollback") Valuations for the City. • Levies and Tax Collections. • Larger Taxpayers. • Tax Rates. • Statement of Net Position -Governmental Activities. • Statement of Activities -Governmental Activities. • Balance Sheet -General Fund. • Statement of Revenues, Expenditures and Changes in Fund Balance -General Fund. Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Issuer or related public entities, which have been filed with the National Repository. The Issuer shall clearly identify each such other document so included by reference. Section 5. Reporting of Significant Events. a) Pursuant to the provisions of this Section, the Issuer shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds in a timely manner not later than 10 Business Days after the day of the occurrence of the event: i. Principal and interest payment delinquencies; ii. Non-payment related defaults, if material; iii. Unscheduled draws on debt service reserves reflecting financial difficulties; iv. Unscheduled draws on credit enhancements relating to the Bonds reflecting financial difficulties; v. Substitution of credit or liquidity providers, or their failure to perform; vi. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax-exempt status of the Series Bonds, or material events affecting the tax-exempt status of the Bonds; vii. Modifications to rights of Holders of the Bonds, if material; viii. Bond calls (excluding sinking fund mandatory redemptions), if material, and tender offers; ix. Defeasances of the Bonds; x. Release, substitution, or sale of property securing repayment of the Bonds, if material; xi. Rating changes on the Bonds; xii. Bankruptcy, insolvency, receivership or similar event of the Issuer; D-3 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 xiii. The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all of the assets of the Issuer, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; xiv. Appointment of a successor or additional trustee or the change of name of a trustee, if material; xv. Incurrence of a Financial Obligation of the Issuer, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the Issuer, any of which affect security holders, if material; and xvi. Default, event of acceleration, termination event, modification of terms or other similar events under the terms of a Financial Obligation of the Issuer, any of which reflect financial difficulties. b) Whenever the Issuer obtains the knowledge of the occurrence of a Listed Event, the Issuer shall determine if the occurrence is subject to notice only if material, and if so shall as soon as possible determine if such event would be material under applicable federal securities laws. c) If the Issuer determines that knowledge of the occurrence of a Listed Event is not subject to materiality, or determines such occurrence is subject to materiality and would be material under applicable federal securities laws, the Issuer shall promptly, but not later than 10 Business Days after the occurrence of the event, file a notice of such occurrence with the Municipal Securities Rulemaking Board through the filing with the National Repository. Section 6. (Optional: Attorney to check facts: Additional Filing. The Issuer's audited financial statements for fiscal year ending June 30, , [Prior fiscal year if audit not yet available as of the date of the Final Official Statement.] were not available for inclusion in the Final Official Statement. The Issuer agrees to file these audited financial statements in the same manner as the Annual Financial Information when they become available.] Section 7. Termination of Reporting Obligation. The Issuer's obligations under this Disclosure Certificate with respect to each Series of Bonds shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds of that Series or upon the Issuer's receipt of an opinion of nationally recognized bond counsel to the effect that, because of legislative action or final judicial action or administrative actions or proceedings, the failure of the Issuer to comply with the terms hereof will not cause Participating Underwriters to be in violation of the Rule or other applicable requirements of the Securities Exchange Act of 1934, as amended. Section 8. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be the Issuer. Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied: a) If the amendment or waiver relates to the provisions of Section 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Bonds, or the type of business conducted; b) The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and D-4 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 c) The amendment or waiver either (i) is approved by the Holders of the Bonds in the same manner as provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Bonds. In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such amendment in the next Annual Financial Information filing, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(c), and (ii) the Annual Financial Information filing for the year in which the change is made will present a comparison or other discussion in narrative form (and also, if feasible, in quantitative form) describing or illustrating the material differences between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Financial Information filing or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any Annual Financial Information filing or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such information or include it in any future Annual Financial Information filing or notice of occurrence of a Listed Event. Section 11. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any Holder or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate. Direct, indirect, consequential and punitive damages shall not be recoverable by any person for any default hereunder and are hereby waived to the extent permitted by law. A default under this Disclosure Certificate shall not be deemed an event of default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel performance. Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys' fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Issuer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriters and Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity. Section 14. Rescission Rights. The Issuer hereby reserves the right to rescind this Disclosure Certificate without the consent of the Holders in the event the Rule is repealed by the S.E.C. or is ruled invalid by a federal court and the time to appeal from such decision has expired. In the event of a partial repeal or invalidation of the Rule, the Issuer hereby reserves the right to rescind those provisions of this Disclosure Certificate that were required by those parts of the Rule that are so repealed or invalidated. D-5 City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Date: ATTEST: day of , 2022. By: City Clerk CITY OF IOWA CITY, STATE OF IOWA By: Mayor EXHIBIT A NOTICE TO NATIONAL REPOSITORY OF FAILURE TO FILE ANNUAL FINANCIAL INFORMATION Name of Issuer: City of Iowa City, Iowa. Name of Bond Issue: $10,255,000* General Obligation Bonds, Series 2022 Dated Date of Issue: June 1, 2022 NOTICE IS HEREBY GIVEN that the Issuer has not provided Annual Financial Information with respect to the above-named Bonds as required by Section 3 of the Continuing Disclosure Certificate delivered by the Issuer in connection with the Bonds. The Issuer anticipates that the Annual Financial Information will be filed by Dated: day of , 20 . CITY OF IOWA CITY, STATE OF IOWA By: Its: D-6 OFFICIAL BID FORM City of Iowa City May 3, 2022 410 E. Washington Street Speer Financial, Inc. Iowa City, IA 52240 Facsimile: (319) 291-8628 City Council: For the $10,255,000* General Obligation Bonds, Series 2022 (the "Bonds"), of the City of Iowa City, Johnson County, Iowa (the "City"), as described in the annexed Official Terms of Offering, which is expressly made a part of this bid, we will pay you $ (no less than $10,172,960). The Bonds are to bear interest at the following respective rates (each a multiple of 1/8 or 1/100 of 1%) for the Bonds of each designated maturity. AMOUNTS* AND MATURITIES — JUNE 1 $1,315,000 2023 % $995,000 2026 % $995,000 2030 % 995,000 2024 % 995,000 2027 % 995,000 2031 % 995,000 2025 % 995,000 2028 % 980,000 2032 % 995,000 2029 % Any consecutive maturities may be aggregated into term bonds at the option of the bidder, in which case the mandatory redemption provisions shall be on the same schedule as above. Maturities: Term Maturity Maturities: Term Maturity Maturities: Term Maturity Maturities: Term Maturity *Subject to principal adjustment in accordance with the Official Terms of Offering. In submitting this bid, we represent that (i) this bid constitutes a firm offer to purchase the Bonds, and (ii) we have an established industry reputation for underwriting new issuances of municipal bonds and notes. The Bonds are to be executed and delivered to us in accordance with the terms of this bid accompanied by the approving legal opinion of Ahlers & Cooney, P.C., Des Moines, Iowa. The City will pay for the legal opinion. The Purchaser agrees to pay the fee charged by the CUSIP Service Bureau and will accept the Bonds with the CUSIP numbers as entered on the Bonds. As evidence of our good faith, if we are the winning bidder, we will wire transfer the amount of TWO PERCENT OF PAR (the "Deposit") WITHIN TWO HOURS after the bid opening time to the City's good faith bank and under the terms provided in the Official Terms of Offering for the Bonds. Alternatively, we have wire transferred or enclosed herewith a check payable to the City in the amount of the Deposit under the terms provided in the Official Terms of Offering for the Bonds. Attached hereto is a list of members of our account on whose behalf this bid is made. Form of Deposit (Check One) Prior to Bid Opening: Certified/Cashier's Check Wire Transfer [] [] Within TWO Hours of Bid Opening: Wire Transfer [ Amount: $205,100 Account Manager Information Underwriter/Bank Address Authorized Rep City State/Zip Direct Phone ( ) FAX Number ( ) E -Mail Address Bidders Option Insurance We have purchased insurance from: Name of Insurer (Please fill in) Premium: Maturities: (Check One) 1 ] Years Ll AJ► The foregoing bid was accepted and the Bonds sold by resolution of the City on Tuesday, May 3, 2022, and receipt is hereby acknowledged of the good faith Deposit which is being held in accordance with the terms of the annexed Official Terms of Offering. ATTEST: CITY OF IOWA CITY JOHNSON COUNTY, IOWA City Clerk Mayor NOT PART OF THE BID --------- Calculation of true interest cos Gross Interest $ Less Premium/Plus Discount S True Interest Cost $ True Interest Rate % TOTAL BOND YEARS AVERAGE LIFE 54,895 5.353 Years City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 OFFICIAL TERMS OF OFFERING $10,255,000* CITY OF IOWA CITY Johnson County, Iowa General Obligation Bonds, Series 2022 The City of Iowa City, Johnson County, Iowa, (the "City"), will receive electronic bids on the SpeerAuction ("SpeerAuction") website address "www.SpeerAuction.com" for its $10,255,000* General Obligation Bonds, Series 2022 (the "Bonds"), on an all or none basis between 10:30 A.M. and 11:00 A.M., C.D.T., Tuesday, May 3, 2022. To bid electronically, bidders must have: (1) completed the registration form on the SpeerAuction website, and (2) requested and received admission to the City's sale (as described below). The City will also receive sealed bids for the Bonds, on an all or none basis, at the office of the Finance Director, City Hall, 410 E. Washington, Iowa City, Iowa, before 11:00 A.M., C.D.T., Tuesday, May 3, 2022. The City will also receive facsimile bids at (319) 291-8628 or (319) 341-4008 for the Bonds, on an all or none basis, before 11:00 A.M., C.D.T., Tuesday, May 3, 2022. Upon receipt, facsimile bids will be sealed and treated as sealed bids, and along with all other sealed bids will be publicly opened and, together with any electronic bids, read. Award will be made or all bids rejected at a meeting of the City on that date. The City reserves the right to reject all bids, to reject any bid proposal not conforming to this Official Terms of Offering, and to waive any irregularity or informality with respect to any bid. Additionally, the City reserves the right to modify or amend this Official Terms of Offering; however, any such modification or amendment shall not be made less than twenty-four (24) hours prior to the date and time for receipt of bids on the Bonds and any such modification or amendment will be announced on the Amendments Page of the SpeerAuction webpage and through Thomson Municipal News. The Bonds will constitute valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable, real property within the corporate limits of the City without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors' rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. *ADJUSTMENTS TO PRINCIPAL AMOUNT AFTER DETERMINATION OF BEST BID. The aggregate principal amount of the Bonds, and each scheduled maturity thereof are subject to increase or reduction by the City or its designee after the determination of the Winning Bidder. The City may increase or decrease each maturity in increments of $5,000, but the total amount to be issued will not exceed $10,255, 000. Interest rates specified by the Winning Bidder for each maturity will not change. Final adjustments shall be in the sole discretion of the City. The dollar amount of the purchase price proposed by the Winning Bidder will be changed if the aggregate principal amount of the Bonds is adjusted as described above. Any change in the principal amount of any maturity of the Bonds will be made while maintaining, as closely as possible, the Winning Bidder's net compensation, calculated as a percentage of bond principal. The Winning Bidder may not withdraw or modify its bid as a result of any post -bid adjustment. Any adjustment shall be conclusive, and shall be binding upon the Winning Bidder. Establishment of Issue Price (10% Test May Apply if Competitive Sale Requirements are Not Satisfied) (a) The winning bidder shall assist the City in establishing the issue price of the Bonds and shall execute and deliver to the City at closing an "issue price" or similar certificate setting forth the reasonably expected initial offering price to the Public or the sales price or prices of the Bonds, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit A to this Official Terms of Offering, with such modifications as may be appropriate or necessary, in the reasonable judgment of the winning bidder, the City and Ahlers & Cooney, P.C. ("Bond Counsel"). All actions to be taken by the City under this Official Terms of Offering to establish the issue price of the Bonds may be taken on behalf of the City by the City's municipal advisor and any notice or report to be provided to the City may be provided to Speer Financial, Inc., Chicago, Illinois ("Speer"). City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 (b) The City intends that the provisions of Treasury Regulation Section 1.148-1(f)(3)(i) (defining "competitive sale" for purposes of establishing the issue price of the Bonds) will apply to the initial sale of the Bonds (the "competitive sale requirements") because: (i) the City shall disseminate this Official Terms of Offering to potential Underwriters in a manner that is reasonably designed to reach potential Underwriters; (ii) all bidders shall have an equal opportunity to bid; (iii) the City may receive bids from at least three Underwriters of municipal bonds who have established industry reputations for underwriting new issuances of municipal bonds; and (iv) the City anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to purchase the Bonds at the lowest true interest cost, as set forth in this Official Terms of Offering. Any bid submitted pursuant to this Official Terms of Offering shall be considered a firm offer for the purchase of the Bonds, as specified in the bid. (c) In the event that the competitive sale requirements are not satisfied, the City shall so advise the winning bidder. The City will not require bidders to comply with the "hold -the -offering -price rule" and therefore does not intend to use the initial offering price to the Public as of the Sale Date of any maturity of the Bonds as the issue price of that maturity, though the winning bidder may elect to apply the "hold the offering price rule" (as described below). Bids will not be subject to cancellation in the event that the competitive sale requirements are not satisfied. Unless a bidder intends to apply the "hold -the -offering -price rule" as described below, bidders should prepare their bids on the assumption that all of the maturities of the Bonds will be subject to the 10% test (as described below) in order to establish the issue price of the Bonds. If the competitive sale requirements are not satisfied, the 10% test shall apply to determine the issue price of each maturity of the Bonds unless the winning bidder shall request that the "hold -the -offering -price rule" (as described below) shall apply. The winning bidder must notify Speer of its intention to apply the "hold -the -offering -price rule" at or prior to the time the Bonds are awarded. (i) If the winning bidder does not request that the "hold -the -offering -price rule" apply to determine the issue price of the Bonds, the following two paragraphs shall apply: The City shall treat the first price at which 1 0% of a maturity of the Bonds (the "10% test") is sold to the Public as the issue price of that maturity, applied on a maturity -by -maturity basis. The winning bidder shall advise the City if any maturity of the Bonds satisfies the 10% test as of the date and time of the award of the Bonds. Until the 10% test has been satisfied as to each maturity of the Bonds, the winning bidder agrees to promptly report to the City the prices at which the unsold Bonds of that maturity have been sold to the Public. That reporting obligation shall continue, whether or not the closing date has occurred, until the 10% test has been satisfied as to the Bonds of that maturity or until all Bonds of that maturity have been sold to the Public. In addition, if the 10% test has not been satisfied with respect to any maturity of the Bonds prior to closing, then the purchaser shall provide the City with a representation as to the price of prices, as of the date of closing, at which the purchaser reasonably expects to sell the remaining Bonds of such maturity. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 (ii) If the winning bidder does request that the "hold -the -offering -price rule" apply to determine the issue price of the Bonds, the following three paragraphs shall apply: The City may determine to treat (i) pursuant to the 10% test, the first price at which 10% of a maturity of the Bonds is sold to the Public as the issue price of that maturity and/or (ii) the initial offering price to the Public as of the Sale Date of any maturity of the Bonds as the issue price of that maturity (the "hold -the -offering - price rule"), in each case applied on a maturity -by -maturity basis. The winning bidder shall advise the City if any maturity of the Bonds satisfies the 10% test as of the date and time of the award of the Bonds. The City shall promptly advise the winning bidder, at or before the time of award of the Bonds, which maturities of the Bonds shall be subject to the 10% test or shall be subject to the hold -the - offering -price rule or both. Bids will not be subject to cancellation in the event that the City determines to apply the hold -the -offering -price rule to any maturity of the Bonds. By submitting a bid, the winning bidder shall (i) confirm that the Underwriters have offered or will offer the Bonds to the Public on or before the date of award at the offering price or prices (the "initial offering price"), and (ii) agree, on behalf of the Underwriters participating in the purchase of the Bonds, that the Underwriters will neither offer nor sell unsold Bonds of any maturity to which the hold -the -offering -price rule shall apply to any person at a price that is higher than the initial offering price to the Public during the period starting on the Sale Date and ending on the earlier of the following: (1) the close of the fifth business day after the Sale Date; or (2) the date on which the Underwriters have sold at least 10% of that maturity of the Bonds to the Public at a price that is no higher than the initial offering price to the Public. The City acknowledges that, in making the representation set forth above, the winning bidder will rely on (i) the agreement of each Underwriter to comply with the hold -the -offering -price rule, as set forth in an agreement among Underwriters and the related pricing wires, (ii) in the event a selling group has been created in connection with the initial sale of the Bonds to the Public, the agreement of each dealer who is a member of the selling group to comply with the hold -the -offering - price rule, as set forth in a selling group agreement and the related pricing wires, and (iii) in the event that an Underwriter is a party to a retail distribution agreement that was employed in connection with the initial sale of the Bonds to the Public, the agreement of each broker-dealer that is a party to such agreement to comply with the hold -the -offering -price rule, as set forth in the retail distribution agreement and the related pricing wires. The City further acknowledges that each Underwriter shall be solely liable for its failure to comply with its agreement regarding the hold -the -offering -price rule and that no Underwriter shall be liable for the failure of any other Underwriter, or of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a retail distribution agreement to comply with its corresponding agreement regarding the hold -the - offering -price applicable to the Bonds. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 (d) By submitting a bid, each bidder confirms that: (i) any agreement among Underwriters, any selling group agreement and each retail distribution agreement (to which the bidder is a party) relating to the initial sale of the Bonds to the Public, together with the related pricing wires, contains or will contain language obligating each Underwriter, each dealer who is a member of the selling group, and each broker-dealer that is a party to such retail distribution agreement, as applicable, to (a) report the prices at which it sells to the Public the unsold Bonds of each maturity allotted to it until it is notified by the winning bidder that either the 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that maturity have been sold to the Public and (b) comply with the hold -the -offering -price rule, if applicable, in each case if and for so long as directed by the winning bidder and as set forth in the related pricing wires which shall be at least until the 10% test has been satisfied as to the Bonds of that maturity or until the close of the fifth business day following the date of the award, and (ii) any agreement among Underwriters relating to the initial sale of the Bonds to the Public, together with the related pricing wires, contains or will contain language obligating each Underwriter that is a party to a retail distribution agreement to be employed in connection with the initial sale of the Bonds to the Public to require each broker-dealer that is a party to such retail distribution agreement to (a) report the prices at which it sells to the Public the unsold Bonds of each maturity allotted to it until it is notified by the winning bidder or such Underwriter that either the 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that maturity have been sold to the Public and (b) comply with the hold -the -offering -price rule, if applicable, in each case if and for so long as directed by the winning bidder or such Underwriter and as set forth in the related pricing wires, which shall be at least until the 10% test has been satisfied as to the Bonds of that maturity or until the close of the fifth business day following the date of the award. (e) Sales of any Bonds to any person that is a Related Party to an Underwriter shall not constitute sales to the Public for purposes of this Official Terms of Offering. Further, for purposes of this Official Terms of Offering: (i) "Public" means any person other than an Underwriter or a Related Party, (ii) "Underwriter" means (A) any person that agrees pursuant to a written contract with the City (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the public including, specifically, the purchaser, and (b) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public), (iii) a purchaser of any of the Bonds is a "Related Party" to an Underwriter if the Underwriter and the purchaser are subject, directly or indirectly, to (i) at least 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation of another), (ii) more than 50% common ownership of their capital interests or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (iii) more than 50% common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other), and (iv) "Sale Date" means the date that the Bonds are awarded by the City to the winning bidder. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Establishment of Issue Price (Hold -the -Offering Price Rule May Apply if Competitive Sale Requirements are Not Satisfied) The winning bidder shall assist the City in establishing the issue price of the Bonds and shall execute and deliver to the City at Closing an "issue price" or similar certificate setting forth the reasonably expected initial offering price to the public or the sales price or prices of the Bonds, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit A to this Official Terms of Offering, with such modifications as may be appropriate or necessary, in the reasonable judgment of the winning bidder, the City and Bond Counsel. All actions to be taken by the City under this Official Terms of Offering to establish the issue price of the Bonds may be taken on behalf of the City by the City's municipal advisor identified herein and any notice or report to be provided to the City may be provided to the City s municipal advisor. The City intends that the provisions of Treasury Regulation Section 1.148-1(f)(3)(i) (defining "competitive sale" for purposes of establishing the issue price of the Bonds) will apply to the initial sale of the Bonds (the "competitive sale requirements") because: (1) the City shall disseminate this Official Terms of Offering to potential underwriters in a manner that is reasonably designed to reach potential underwriters; (2) all bidders shall have an equal opportunity to bid; (3) the City may receive bids from at least three underwriters of municipal bonds who have established industry reputations for underwriting new issuances of municipal bonds; and (4) the City anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to purchase the Bonds at the highest price (or lowest true interest cost), as set forth in this Official Terms of Offering. Any bid submitted pursuant to this Official Terms of Offering shall be considered a firm offer for the purchase of the Bonds, as specified in the bid. In the event that the competitive sale requirements are not satisfied, the City shall so advise the winning bidder. The City may determine to treat (i) the first price at which 10% of a maturity of the Bonds (the "10% test") is sold to the public as the issue price of that maturity and/or (ii) the initial offering price to the public as of the sale date of any maturity of the Bonds as the issue price of that maturity (the "hold -the -offering -price rule"), in each case applied on a maturity -by - maturity basis (and if different interest rates apply within a maturity, to each separate CUSIP number within that maturity). The winning bidder shall advise the City if any maturity of the Bonds satisfies the 10% test as of the date and time of the award of the Bonds. The City shall promptly advise the winning bidder, at or before the time of award of the Bonds, which maturities (and if different interest rates apply within a maturity, which separate CUSIP number within that maturity) of the Bonds shall be subject to the 10% test or shall be subject to the hold -the -offering -price rule. Bids will not be subject to cancellation in the event that the City determines to apply the hold -the -offering -price rule to any maturity of the Bonds. Bidders should prepare their bids on the assumption that some or all of the maturities of the Bonds will be subject to the hold -the -offering -price rule in order to establish the issue price of the Bonds. By submitting a bid, the winning bidder shall (i) confirm that the underwriters have offered or will offer the Bonds to the public on or before the date of award at the offering price or prices (the "initial offering price"), or at the corresponding yield or yields, set forth in the bid submitted by the winning bidder and (ii) agree, on behalf of the underwriters participating in the purchase of the Bonds, that the underwriters will neither offer nor sell unsold Bonds of any maturity to which the hold -the -offering -price rule shall apply to any person at a price that is higher than the initial offering price to the public during the period starting on the sale date and ending on the earlier of the following: (1) the close of the fifth (5t1i) business day after the sale date; or (2) the date on which the underwriters have sold at least 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public. The winning bidder shall promptly advise the City when the underwriters have sold 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public, if that occurs prior to the close of the fifth (5th) business day after the sale date. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 If the competitive sale requirements are not satisfied, then until the 10% test has been satisfied as to each maturity of the Bonds, the winning bidder agrees to promptly report to the City the prices at which the unsold Bonds of that maturity have been sold to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until the 10% test has been satisfied as to the Bonds of that maturity or until all Bonds of that maturity have been sold. The City acknowledges that, in making the representation set forth above, the winning bidder will rely on (i) the agreement of each underwriter to comply with the hold -the -offering -price rule, as set forth in an agreement among underwriters and the related pricing wires, (ii) in the event a selling group has been created in connection with the initial sale of the Bonds to the public, the agreement of each dealer who is a member of the selling group to comply with the hold - the -offering -price rule, as set forth in a selling group agreement and the related pricing wires, and (iii) in the event that an underwriter is a party to a retail distribution agreement that was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a party to such agreement to comply with the hold -the -offering - price rule, as set forth in the retail distribution agreement and the related pricing wires. The City further acknowledges that each underwriter shall be solely liable for its failure to comply with its agreement regarding the hold -the -offering -price rule and that no underwriter shall be liable for the failure of any other underwriter, or of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a retail distribution agreement to comply with its corresponding agreement regarding the hold -the -offering -price rule as applicable to the Bonds. By submitting a bid, each bidder confirms that: (i) any agreement among underwriters, any selling group agreement and each retail distribution agreement (to which the bidder is a party) relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each underwriter, each dealer who is a member of the selling group, and each broker-dealer that is a party to such retail distribution agreement, as applicable, to (A) report the prices at which it sells to the public the unsold Bonds of each maturity allotted to it until it is notified by the winning bidder that either the 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that maturity have been sold to the public and (B) comply with the hold -the -offering -price rule, if applicable, in each case if and for so long as directed by the winning bidder and as set forth in the related pricing wires, and (ii) any agreement among underwriters relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each underwriter that is a party to a retail distribution agreement to be employed in connection with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such retail distribution agreement to (A) report the prices at which it sells to the public the unsold Bonds of each maturity allotted to it until it is notified by the winning bidder or such underwriter that either the 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that maturity have been sold to the public and (B) comply with the hold -the -offering -price rule, if applicable, in each case if and for so long as directed by the winning bidder or such underwriter and as set forth in the related pricing wires. Sales of any Bonds to any person that is a related party to an underwriter shall not constitute sales to the public for purposes of this Official Terms of Offering. Further, for purposes of this Official Terms of Offering: (1) "public" means any person other than an underwriter or a related party; (2) "underwriter" means (A) any person that agrees pursuant to a written contract with the City (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the public and (B) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to the public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the public); (3) a purchaser of any of the Bonds is a "related party" to an underwriter if the underwriter and the purchaser are subject, directly or indirectly, to (i) at least 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation of another), (ii) more than 50% common ownership of their capital interests or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (iii) more than 50% common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other); and (4) "sale date" means the date that the Bonds are awarded by the City to the winning bidder. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Bond Details The Bonds will be in fully registered form in the denominations of $5,000 and integral multiples thereof in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, to which principal and interest payments on the Bonds will be paid. Individual purchases will be in book -entry form only. Interest on each Bond shall be paid by check or draft of the Bond Registrar to the person in whose name such Bond is registered at the close of business on the fifteenth day of the month next preceding an interest payment date on such bond. The principal of the Bonds shall be payable in lawful money of the United States of America at the principal office maintained for the purpose by the Bond Registrar in St. Paul, Minnesota. Semiannual interest is due June 1 and December 1 of each year, commencing December 1, 2022 and is payable by U.S. Bank Trust Company, National Association, St. Paul, Minnesota (the "Bond Registrar"). The Bonds are dated the date of delivery (expected to be on or about June 1, 2022). AMOUNTS* AND MATURITIES — JUNE 1 $1,315,000 2023 $995,000 2026 $995,000 2030 995,000 2024 995,000 2027 995,000 2031 995,000 2025 995,000 2028 980,000 2032 995,000 2029 Any consecutive maturities may be aggregated into term bonds at the option of the bidder, in which case the mandatory redemption provisions shall be on the same schedule as above. The Bonds due June 1, 2023 - 2028, inclusive, are non -callable. The Bonds due June 1, 2029 - 2032, inclusive, are callable in whole or in part and on any date on or after June 1, 2028, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in any order of maturity as determined by the City and within any maturity by lot. Method of Bidding Electronically Notwithstanding the fact that the City permits receiving bids electronically using SpeerAuction, all bidders must have a signed, but uncompleted, Official Bid Form delivered to Speer Financial, Inc., Suite 608, 531 Commercial Street, Waterloo, Iowa, (319) 291-8628 facsimile, prior to the close of bidding to which a printout of the electronic bid will be attached and delivered to the City. If bidding electronically, all -or -none bids must be submitted via the internet address www.SpeerAuction.com. The use of SpeerAuction shall be at the bidder's risk and expense and the City shall have no liability with respect thereto, including (without limitation) liability with respect to incomplete, late arriving and non -arriving bids. To bid via the SpeerAuction webpage, bidders must first visit the SpeerAuction webpage where, if they have not previously registered with either SpeerAuction, Grant Street Group (the "Auction Administrator") or any other website administered by the Auction Administrator, they may register and then request admission to bid on the Bonds. Bidders will be notified prior to the scheduled bidding time of their eligibility to bid. Only registered broker-dealers and dealer banks with DTC clearing arrangements will be eligible to bid electronically. The "Rules" of the SpeerAuction bidding process may be viewed on the SpeerAuction webpage and are incorporated herein by reference. Bidders must comply with the Rules of SpeerAuction in addition to the requirements of the City's Official Terms of Offering. In the event the Rules of SpeerAuction and this Official Terms of Offering conflict, this Official Terms of Offering shall be controlling. All electronic bids must be submitted on the SpeerAuction webpage. Electronic bidders may change and submit bids as many times as they choose during the sale period but may not delete a submitted bid. The last bid submitted by an electronic bidder before the deadline for receipt of bids will be compared to all other final bids to determine the winning bidder. During the bidding, no bidder will see any other bidder's bid nor the status of their bid relative to other bids (e.g., whether their bid is a leading bid). The electronic bidder bears all risk of transmission failure. Any questions regarding bidding on the SpeerAuction website should be directed to Grant Street Group at (412) 391-5555 x 370. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Each bidder shall be solely responsible for making necessary arrangements to access SpeerAuction for purposes of submitting its internet bid in a timely manner and in compliance with the requirements of the Terms of Offering. The City is permitting bidders to use the services of the SpeerAuction solely as a communication mechanism to conduct the internet bidding and the SpeerAuction is not an agent of the City. Provisions of the Terms of Offering and Official Bid Form shall control in the event of conflict with information provided by the Internet Bid System. Electronic Facsimile Bidding: Bids may be submitted via facsimile at (319) 291-8628 or (319) 341-4008. Electronic facsimile bids will be sealed and treated as sealed bids. Neither the City nor its agents will assume liability for the inability of the bidder to reach the above named fax numbers prior to the time of sale specified above. Transmissions received after the deadline will be rejected. Bidders electing to submit bids via facsimile transmission bear full and complete responsibility for the transmission of such bid. Neither the City nor its agents will assume responsibility for the inability of the bidder to reach the above specified fax number prior to the time of sale. Time of receipt shall be the time recorded by the person receiving the facsimile and shall be conclusive. Bidding Parameters and Award of the Bonds All interest rates must be in multiples of one-eighth or one one-hundredth of one percent (1/8 or 1/100 of 1%), and not more than one rate for a single maturity shall be specified. The differential between the highest rate bid and the lowest rate bid shall not exceed three percent (3%). All bids must be for all of the Bonds and must be for not less than $10,172,960. Award of the Bonds: The Bonds will be awarded on the basis of true interest cost, determined in the following manner True interest cost shall be computed by determining the annual interest rate (compounded semi-annually) necessary to discount the debt service payments on the Bonds from the payment dates thereof to the dated date and to the bid price. For the purpose of calculating true interest cost, the Bonds shall be deemed to become due in the principal amounts and at the times set forth in the table of maturities set forth above. In the event two or more qualifying bids produce the identical lowest true interest cost, the winning bid shall be the bid that was submitted first in time on the SpeerAuction webpage or if all such bids are not submitted electronically, the winning bid shall be determined by lot. The Bonds will be awarded to the bidder complying with the terms of this Official Terms of Offering whose bid produces the lowest true interest cost rate to the City as determined by the City's Registered Municipal Advisor, which determination shall be conclusive and binding on all bidders; provided, that the City reserves the right to reject all bids or any non -conforming bid and reserves the right to waive any informality in any bid. Electronic bidders should verify the accuracy of their final bids and compare them to the winning bids reported on the SpeerAuction Observation Page immediately after the bidding. The premium or discount, if any, is subject to pro rata adjustment if the maturity amounts of the Bonds are changed, maintaining, as close as possible, the same dollar amount of profit per $1,000 bond as bid. The true interest cost of each electronic bid will be computed by SpeerAuction and reported on the Observation Page of the SpeerAuction webpage immediately following the date and time for receipt of bids. These true interest costs are subject to verification by the City's Municipal Advisor, will be posted for information purposes only and will not signify an actual award of any bid or an official declaration of the winning bid. The City or its Municipal Advisor will notify the bidder to whom the Bonds will be awarded, if and when such award is made. The winning bidder will be required to make the standard filings and maintain the appropriate records routinely required pursuant to MSRB Rules G-8, G-11 and G-36. The winning bidder will be required to pay the standard MSRB charge for Bonds purchased. In addition, the winning bidder who is a member of the Securities Industry and Financial Markets Association ("SIFMA") will be required to pay SIFMA's standard charge per Bond. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 Good Faith Deposit and Other Matters The winning bidder is required to a wire transfer from a solvent bank or trust company to the City's good faith bank the amount of TWO PERCENT OF PAR (the "Deposit") WITHIN TWO HOURS after the bid opening time as evidence of the good faith of the bidder. Alternatively, a bidder may submit its Deposit upon or prior to the submission of its bid in the form of a certified or cashier's check on, or a wire transfer from, a solvent bank or trust company for TWO PERCENT OF PAR payable to the Treasurer of the City. The City reserves the right to award the Bonds to a winning bidder whose wire transfer is initiated but not received within such two hour time period provided that such winning bidder's federal wire reference number has been received. In the event the Deposit is not received as provided above, the City may award the Bonds to the bidder submitting the next best bid provided such bidder agrees to such award. If a wire transfer is used for the Deposit, it must be sent according to the following wire instructions: Amalgamated Bank of Chicago Corporate Trust 30 North LaSalle Street 38th Floor Chicago, IL 60602 ABA # 071003405 Credit To: 3281 Speer Bidding Escrow RE: City of Iowa City, Johnson County, Iowa bid for $10,255,000* General Obligation Bonds, Series 2022 If the wire shall arrive in such account prior to the date and time of the sale of the Bonds. Contemporaneously with such wire transfer, the prospective purchaser shall send an email to biddingescrow@aboc.com with the following information: (1) indication that a wire transfer has been made, (2) the amount of the wire transfer, (3) the issue to which it applies, and (4) the return wire instructions if such prospective purchaser is not awarded the Bonds. The City and any prospective purchaser who chooses to wire the Deposit hereby agree irrevocably that Speer Financial, Inc. ("Speer") shall be the escrow holder of the Deposit wired to such account subject only to these conditions and duties: (i) if the bid is not accepted, Speer shall, at its expense, promptly return the Deposit amount to the unsuccessful prospective purchaser; (ii) if the bid is accepted, the Deposit shall be forwarded to the City, (iii) Speer shall bear all costs of maintaining the escrow account and returning the funds to the prospective purchaser; (iv) Speer shall not be an insurer of the Deposit amount and shall have no liability except if it willfully fails to perform, or recklessly disregards, its duties specified herein; and (v) income earned on the Deposit, if any, shall be retained by Speer. The City covenants and agrees to enter into a written agreement, certificate or contract, constituting an undertaking (the "Undertaking") to provide ongoing disclosure about the City for the benefit of the beneficial owners of the Bonds on or before the date of delivery of the Bonds as required under Section (b)(5) of Rule 15c2-12 (the "Rule") adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934. The Undertaking shall be as described in the Official Statement, with such changes as may be agreed in writing by the Underwriter. The Underwriter's obligation to purchase the Bonds shall be conditioned upon the City delivering the Undertaking on or before the date of delivery of the Bonds. The Bonds will be delivered to the successful purchaser against full payment in immediately available funds as soon as they can be prepared and executed, which is expected to be on or about June 1, 2022. Should delivery be delayed beyond sixty (60) days from the date of sale for any reason beyond the control of the City except failure of performance by the purchaser, the City may cancel the award or the purchaser may withdraw the good faith deposit and thereafter the purchaser's interest in and liability for the Bonds will cease. City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts, and interest rates of the Bonds, and any other information required by law or deemed appropriate by the City, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in the Rule. By awarding the Bonds to any underwriter or underwriting syndicate, the City agrees that, no more than seven (7) business days after the date of such award, it shall provide, without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded, up to 50 copies of the Final Official Statement to permit each "Participating Underwriter" (as that term is defined in the Rule) to comply with the provisions of such Rule. The City shall treat the senior managing underwriter of the syndicate to which the Bonds are awarded as its designated agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter executing and delivering an Official Bid Form with respect to the Bonds agrees thereby that if its bid is accepted by the City it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. By submission of its bid, the senior managing underwriter of the successful purchaser agrees to supply all necessary pricing information and any Participating Underwriter identification necessary to complete the Official Statement within 24 hours after award of the Bonds. Additional copies of the Final Official Statement may be obtained by Participating Underwriters from the printer at cost. The City will, at its expense, deliver the Bonds to the purchaser in New York, New York (or arrange for "FAST" delivery) through the facilities of DTC and will pay for the bond attorney's opinion. At the time of closing, the City will also furnish to the purchaser the following documents, each dated as of the date of delivery of the Bonds: (1) the legal opinion of Ahlers & Cooney, P.C., Des Moines, Iowa, that the Bonds are lawful and enforceable obligations of the City in accordance with their terms; (2) the opinion of said attorneys that the interest on the Bonds is exempt from federal income taxes as and to the extent set forth in the Official Statement for the Bonds; and (3) a no litigation certificate by the City. Purchaser consents to the receipt of electronic transcripts and acknowledges the City's intended use of electronically executed documents. Iowa Code Chapter 554D establishes electronic signatures have the full weight and legal authority as manual signatures. The City has authorized the printing and distribution of an Official Statement containing pertinent information relative to the City and the Bonds. Copies of such Official Statement or additional information may be obtained from Nicole Davies, Finance Director, City of Iowa City, 410 E. Washington Street, Iowa City, Iowa, 52240 or an electronic copy of this Official Statement is available from the www.speerfinancial.com website under "Official Statement Sales/Competitive Calendar" or from the Registered Municipal Advisor to the City, Speer Financial, Inc., 531 Commercial Street, Suite 608, Waterloo, Iowa 50701 (telephone (319) 291-2077), and 230 West Monroe Street, Suite 2630, Chicago, Illinois 60606 (telephone (312) 346-3700). /s/ NICOLE DAVIES Finance Director CITY OF IOWA CITY Johnson County, Iowa City of Iowa City, Johnson County, Iowa $10,255,000* General Obligation Bonds, Series 2022 EXHIBIT A EXAMPLE ISSUE PRICE CERTIFICATE USE FOR COMPETITIVE SALES — 3 BIDS RECEIVED EXHIBIT A $ General Obligation Bonds, Series 2022 of Iowa City, Iowa ISSUE PRICE CERTIFICATE The undersigned, on behalf of [NAME OF UNDERWRITER] ("Purchaser"), hereby certifies as set forth below with respect to the sale of the above -captioned obligations (the "Bonds"). 1. Reasonably Expected Initial Offering Price. (a) As of the Sale Date, the reasonably expected initial offering prices of the Bonds to the Public by Purchaser are the prices listed in Schedule A (the "Expected Offering Prices"). The Expected Offering Prices are the prices for the Maturities of the Bonds used by Purchaser in formulating its bid to purchase the Bonds. Attached as Schedule B is a true and correct copy of the bid provided by Purchaser to purchase the Bonds. (b) Purchaser was not given the opportunity to review other bids prior to submitting its bid. (c) The bid submitted by Purchaser constituted a firm offer to purchase the Bonds. 2. Defined Terms. (a) Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (b) Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (c) Sale Date means the first day on which there is a binding contract in writing for the sale of a Maturity of the Bonds. The Sale Date of the Bonds is May 3, 2022. (d) Underwriter means (i) the Purchaser or any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public). The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Purchaser's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer and its agents with respect to certain of the representations set forth in the Tax Exemption Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Ahlers & Cooney, P.C. in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. [UNDERWRITER] By: Name: Dated: [ISSUE DATE] SCHEDULE A EXPECTED OFFERING PRICES (Attached) SCHEDULE B COPY OF UNDERWRITER'S BID (Attached) $ USE FOR GENERAL RULE 10%- PUBLIC SALE EXHIBIT A General Obligation Bonds, Series 2022 of Iowa City, Iowa ISSUE PRICE CERTIFICATE The undersigned, on behalf of [NAME OF UNDERWRITER] ("Purchaser"), on behalf of itself, hereby certifies as set forth below with respect to the sale and issuance of the above -captioned obligations (the "Bonds"). 1. Sale of the Bonds. As of the date of this certificate, for each Maturity of the Bonds, the first price at which at least 10% of such Maturity of the Bonds was sold to the Public is the respective price listed in Schedule A. 2. Defined Terms. (a) Issuer means the Iowa City, Iowa, a municipal corporation in the State of Iowa. (b) Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (c) Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (d) Underwriter means (i) the Purchaser or any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public). The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Purchaser's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer and its agents with respect to certain of the representations set forth in the Tax Exemption Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Ahlers & Cooney, P.C., as Bond Counsel, in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. [Signature Page Follows] [UNDERWRITER] By: Name: Dated: [ISSUE DATE] SCHEDULE A SALE PRICES (Attached) [USE IF SOME MATURITIES SUBJECT TO HOLD THE PRICE, OTHERS 10% RULE] EXHIBIT A $ General Obligation Bonds, Series 2022 of Iowa City, Iowa ISSUE PRICE CERTIFICATE The undersigned, on behalf of [NAME OF UNDERWRITER] ("Purchaser"), on behalf of itself, hereby certifies as set forth below with respect to the sale and issuance of the above -captioned obligations (the "Bonds"). 1. Sale of the General Rule Maturities. As of the date of this certificate, for each Maturity of the General Rule Maturities, the first price at which at least 1 0% of such Maturity was sold to the Public is the respective price listed in Schedule A. 2. Initial Offering Price of the Hold -the -Offering -Price Maturities. (a) Purchaser offered the Hold -the -Offering -Price Maturities to the Public for purchase at the respective initial offering prices listed in Schedule A (the "Initial Offering Prices") on or before the Sale Date. A copy of the pricing wire or equivalent communication for the Bonds is attached to this certificate as Schedule B. (b) As set forth in the Notice of Sale and bid award, Purchaser has agreed in writing that, (i) for each Maturity of the Hold -the -Offering -Price Maturities, it would neither offer nor sell any of the Bonds of such Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the Holding Period for such Maturity (the "hold -the -offering -price rule"), and (ii) any selling group agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail distribution agreement shall contain the agreement of each broker-dealer who is a party to the retail distribution agreement, to comply with the hold -the -offering -price rule. Pursuant to such agreement, no Underwriter (as defined below) has offered or sold any Maturity of the Hold -the -Offering -Price Maturities at a price that is higher than the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period. 3. Defined Terms. (a) General Rule Maturities means those Maturities of the Bonds listed in Schedule A hereto as the "General Rule Maturities." (b) Hold -the -Offering -Price Maturities means those Maturities of the Bonds listed in Schedule A hereto as the "Hold -the -Offering -Price Maturities." (c) Holding Period means, with respect to a Hold -the -Offering -Price Maturity, the period starting on the Sale Date and ending on the earlier of (i) the close of the fifth business day after the Sale Date ([DATE]), or (ii) the date on which Purchaser has sold at least 1 0% of such Hold -the -Offering -Price Maturity to the Public at prices that are no higher than the Initial Offering Price for such Hold -the -Offering - Price Maturity. (d) Issuer means the Iowa City, Iowa, a municipal corporation in the State of Iowa. (e) Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate maturities. (f) Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (g) Sale Date means the first day on which there is a binding contract in writing for the sale of a Maturity of the Bonds. The Sale Date of the Bonds is May 3, 2022. (h) Underwriter means (i) the Purchaser or any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public). The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents the Purchaser's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer and its agents with respect to certain of the representations set forth in the Tax Exemption Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Ahlers & Cooney, P.C., Bond Counsel, in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. [UNDERWRITER] By: Name: Dated: [ISSUE DATE] SCHEDULE A SALE PRICES OF THE GENERAL RULE MATURITIES AND INITIAL OFFERING PRICES OF THE HOLD -THE -OFFERING -PRICE MATURITIES (Attached) Items to Include on Agenda For April 19, 2022 City of Iowa City, Iowa $10,255,000* (Subject to Adjustment Per Terms of Offering) General Obligation Bonds, Series 2022 Resolution directing the advertisement for sale and approving electronic bidding procedures and Distribution of Preliminary Official Statement. Notice Must Be Given Pursuant to Iowa Code Chapter 21 and the Local Rules of the City. April 19, 2022 The City Council of the City of Iowa City, State of Iowa, met in regular session, in Council Chambers, at Emma Harvat Hall, 410 E. Washington St., Iowa City, Iowa, at 6 00 P .M., on the above date. There were present Mayor Teague , in the chair, and the following named Council Members: Alter, Bergus, Harmsen, Taylor, Teague, Thomas,"Weiner Absent: None Vacant: None 2 Council Member Thomas introduced the following Resolution entitled "Resolution Directing the Advertisement for Sale Of $10,255,000* (Dollar Amount Subject to Change) General Obligation Bonds, Series 2022, And Approving Electronic Bidding Procedures And Distribution of Preliminary Official Statement" and moved its adoption. Council Member Alter seconded the Resolution to adopt. The roll was called and the vote was, AYES:Alter, Bergus, Harmsen, Taylor, Teague, Thomas, Weiner NAYS: None Whereupon, the Mayor declared the resolution duly adopted as follows: Resolution 22-106 Resolution Directing the Advertisement For Sale Of $10,255,000* (Dollar Amount Subject To Change) General Obligation Bonds, Series 2022, And Approving Electronic Bidding Procedures And Distribution Of Preliminary Official Statement Whereas, the Issuer is in need of funds to pay costs of the opening, widening, extending, grading and drainage of the right-of-way of streets, highways, avenues, alleys, and public grounds; the construction, reconstruction, and repairing of any street and streetscape improvements, with related utility work, traffic control devices, lighting, sidewalks, and the acquisition of real estate for such purposes; and the rehabilitation and improvement of parks already owned, including facilities, equipment and improvements commonly found in city parks, essential corporate purpose(s), and it is deemed necessary and advisable that General Obligation Bonds, to the amount of Not to Exceed $8,900,000 be authorized for said purpose(s); and Whereas, pursuant to notice published as required by Section 384.25 of the Code of Iowa, this Council has held a public meeting and hearing upon the proposal to institute proceedings for the issuance of the Bonds, and the Council is therefore now authorized to proceed with the issuance of said Bonds for such purpose(s); and Whereas, the City is in need of funds to pay costs of improvements to and equipping of the Senior Center facility, general corporate purpose(s), and it is deemed necessary and advisable that General Obligation Bonds, to the amount of Not to Exceed $700,000 be authorized for said purpose(s); and Whereas, the Issuer has a population of more than 5,000 but not more than 75,000, and the Bonds for these purposes do not exceed $700,000; and Whereas, pursuant to notice published as required by Section 384.26 of the Code of Iowa, the Council of the City has held public meeting and hearing upon the proposal to institute proceedings for the issuance of Bonds for general corporate purpose(s) in the amounts as above 3 set forth, and no petition for referendum having been received, the Council is therefore now authorized to proceed with the issuance of said Bonds for such purpose(s); and Whereas, the City is in need of funds to pay costs of the acquisition, renovation, reconstruction and equipping of City Hall and the fire station; and costs of the acquisition, installation, improving and equipping of city facilities and buildings, including building automation systems, general corporate purpose(s), and it is deemed necessary and advisable that General Obligation Bonds, to the amount of Not to Exceed $700,000 be authorized for said purpose(s); and Whereas, the Issuer has a population of more than 5,000 but not more than 75,000, and the Bonds for these purposes do not exceed $700,000; and Whereas, pursuant to notice published as required by Section 384.26 of the Code of Iowa, the Council of the City has held public meeting and hearing upon the proposal to institute proceedings for the issuance of Bonds for general corporate purpose(s) in the amounts as above set forth, and no petition for referendum having been received, the Council is therefore now authorized to proceed with the issuance of said Bonds for such purpose(s); and Whereas, pursuant to Section 384.28 of the Code of Iowa, it is hereby found and determined that the various general obligation bonds authorized as hereinabove described shall be combined for the purpose of issuance in a single issue of $10,255,000* (Dollar Amount Subject to Change) General Obligation Bonds as hereinafter set forth; and Whereas, in conjunction with its Municipal Advisor, Speer Financial, and Disclosure Counsel, the City has caused a Preliminary Official Statement to be prepared outlining the details of the proposed sale of the Bonds; and Whereas, the Council has received information from its Municipal Advisor evaluating and recommending the procedure hereinafter described for electronic, facsimile and intemet bidding to maintain the integrity and security of the competitive bidding process and to facilitate the delivery of bids by interested parties; and Whereas, the Council deems it in the best interests of the City and the residents thereof to receive bids to purchase such Bonds by means of both sealed and electronic intemet communication. Now, Therefore, Be It Resolved By The City Council Of The City Of Iowa City, State Of Iowa: Section 1. That the receipt of electronic bids by facsimile machine and through the SpeerAuction Competitive Bidding System described in the Notice of Sale and Official Statement are hereby found and determined to provide reasonable security and to maintain the integrity of the competitive bidding process, and to facilitate the delivery of bids by interested parties in connection with the offering at public sale. 4 Section 2. That General Obligation Bonds, Series 2022, of City of Iowa City, State of Iowa, in the amount of $10,255,000* (Dollar Amount Subject to Change), to be issued as referred to in the preamble of this Resolution, to be dated June 1, 2022, be offered for sale pursuant to the published advertisement. Section 3. That the preliminary Official Statement in the form presented to this meeting be and the same hereby is approved as to form and deemed final for purposes of Rule 15c2-I2 of the Securities and Exchange Commission, subject to such revisions, corrections or modifications as the Mayor and City Clerk, upon the advice of bond counsel, disclosure counsel, and the City's Municipal Advisor, shall determine to be appropriate, and is authorized to be distributed in connection with the offering of the Bonds for sale. Section 4. That the Clerk is hereby directed to publish notice of sale of the Bonds at least once, the last one of which shall be not less than four clear days nor more than twenty days before the date of the sale. Publication shall be made in the Iowa City Press -Citizen, a legal newspaper, printed wholly in the English language, published within the county in which the Bonds are to be offered for sale or an adjacent county. The notice is given pursuant to Chapter 75 of the Code of' Iowa, and shall state that this Council, on the 3`d day of May, 2022, at 6:00 P.M., will hold a meeting to receive and act upon bids for said Bonds, which bids were previously received and opened by City Officials at 11:00 A.M. on said date. The notice shall be in substantially the following form: 5 (To be published on April 22, 2022) Notice of Bond Sale Time and Place of Sealed Bids: Bids for the sale of Bonds of the City of Iowa City, State of Iowa, hereafter described, must be received at the office of the Finance Director, City Hall, 410 E. Washington, Iowa City, Iowa 52440 (the "Issuer") before 11:00 A.M., on the 3rd day of May, 2022. The bids will then be publicly opened and referred for action to the meeting of the City Council in conformity with the Terms of Offering. The Bonds: The Bonds to be offered are the following: General Obligation Bonds, Series 2022, in the amount of $10,255,000*, to be dated June 1, 2022 (the "Bonds"). Bids to be received before 11:00 A.M. *Subject to principal adjustment pursuant to official Terms of Offering. Manner of Bidding: Open bids will not be received. Bids will be received in any of the following methods: • Sealed Bidding: Sealed bids may be submitted and will be received at the office of the Finance Director at City Hall, 410 E. Washington, Iowa City, Iowa 52440. • Electronic Internet Bidding: Electronic internet bids will be received at the office of the Finance Director at City Hall, 410 E. Washington, Iowa City, Iowa 52440. The bids must be submitted through the SpeerAuction competitive bidding system. • Electronic Facsimile Bidding: Electronic facsimile bids will be received by the City's Municipal Advisor, Speer Financial, Waterloo, Iowa (facsimile number: (319) 291-8628 or (319) 341-4008). Electronic facsimile bids will be treated as sealed bids. Consideration of Bids: After the time for receipt of bids has passed, the close of sealed bids will be announced. Sealed bids will then be publicly opened and announced. Finally, electronic intemet bids will be accessed and announced. Sale and Award: The sale and award of the Bonds will be held in the Council Chambers, at Emma Harvat Hall, 410 E. Washington St., Iowa City, Iowa at a meeting of the City Council on the above date at 6:00 P.M. Official Statement: The Issuer has issued an Official Statement of information pertaining to the Bonds to be offered, including a statement of the Terms of Offering and an Official Bid Form, which is incorporated by reference as a part of this notice. The Official Statement may be obtained by request addressed to the City Clerk, City Hall, 410 E. Washington, Iowa City, Iowa 6 52440 or the Issuer's Municipal Advisor, Speer Financial, 531 Commercial Street, Waterloo, Iowa, 50703, Telephone: 319-291-2077. Terms of Offering: All bids shall be in conformity with and the sale shall be in accordance with the Terms of Offering as set forth in the Official Statement. Legal Opinion: The Bonds will be sold subject to the opinion of Ahlers & Cooney, P.C., Attorneys of Des Moines, Iowa, as to the legality and their opinion will be furnished together with the printed Bonds without cost to the purchaser and all bids will be so conditioned. Except to the extent necessary to issue their opinion as to the legality of the Bonds, the attorneys will not examine or review or express any opinion with respect to the accuracy or completeness of documents, materials or statements made or furnished in connection with the sale, issuance or marketing of the Bonds. Rights Reserved: The right is reserved to reject any or all bids, and to waive any irregularities as deemed to be in the best interests of the public. By order of the City Council of the City of Iowa City, State of Iowa. City Clerk, City of Iowa City, State of Iowa (End of Notice) 7 Passed and Approved this 19th day of April, 2022. Attest: 8 State of Iowa County of Johnson Certificate ) SS I, the undersigned City Clerk of the City of Iowa City, State of Iowa, do hereby certify that attached is a true and complete copy of the portion of the records of the City showing proceedings of the Council, and the same is a true and complete copy of the action taken by the Council with respect to the matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective City offices as indicated therein, that no Council vacancy existed except as may be stated in the proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WITNESS my hand and the seal of the Council hereto affixed this 19th April 2022. (Seal) day of City Clerk, City of Iowa ty, State of Iowa Certificate State of Iowa ) ) SS County of Johnson ) I, the undersigned, do hereby certify that I am now and was at the times hereinafter mentioned, the duly qualified and acting Clerk of the City of Iowa City, in the County of Johnson, State of Iowa, and that as such Clerk and by full authority from the Council of the City, I have caused a Notice of Bond Sale ($10,255,000* (Dollar Amount Subject to Change) General Obligation Bonds, Series 2022) of which the clipping annexed to the publisher's affidavit hereto attached is in words and figures a correct and complete copy, to be published as required by law in the Iowa City Press -Citizen, a legal newspaper published at least once weekly, printed wholly in the English language, published regularly and mailed through the post office of current entry for more than two years and which has had for more than two years a bona fide paid circulation recognized by the postal laws of the United States, and has a general circulation in the City, and that the Notice was published in all of the issues thereof published and circulated on the following date: ki-c7f-iZ 2022. WITNESS my official signature this 12-90-k- day of sr 1 t , 2022. City Clerk, City ofI wajCity, State of Iowa (Seal) 02031593-I\10714-139 CITY CLERK CIN OF IOWACITY ICPD 410 E WASHINGTON ST IOWA CITY IA 522401825 rned a P 2_ PRESS -CITIZEN MEDIA PART OF THE USA TODAY NETWORK This is not an invoice # of Affidavits 1 AFFIDAVIT OF PUBLICATION State of Wisconsin County of Brown, ss.: The undersigned, being first duly sworn on oath, states that the Iowa City Press Citizen, a corporation duly organized and existing under the laws of the State of Iowa, with its principal place of business in Iowa City, Iowa, the publisher of Iowa City Press Citizen newspaper of general circulation printed and published in the City of Iowa City, Johnson County, Iowa, and that an advertisement, a printed copy of which is attached as Exhibit "A" and made part of this affidavit, was printed and published in the Iowa City Press Citizen on the issues dated: Ad No. Start Date: Editions Dated: Cost: 0005226421 4/23/22 04/23/2022 $7220 Copy of Advertisement Exhibit "A" Subscribed and sworn to before me by savant this 25 day of April, 2022 Notary Public Commission expires KATHLEEN ALLEN Notary Public State of Wisconsin Notice of Bond Sale Time and Ploce of Sealed Bids: Bids for the sole of Bonds of the City of Iowa City. State of Iowa. hereafter described must be received t the office of the inonce Director. Cty Hall. 410 E. Washington, Iowa City. Iowa 52440 (the Issuer') before y11:00 A.M., an hwi llr then beet publicly 02o0ened and referred for action 10 the meeting of the City Council conformity with the Terms inf Ofering. Thoffered Bonds The red arethe following: to be General22, t Obligation of Ste 255 0�e, ndsunot2eie'Bos").Bidthe cevd before 11:00 A.M. •Subject to principal adiustmenl pursuont to official Terms of Offering. Manner of Bidding: Open bids will not be received. Bids will be received in any of the fallowing methods: • SealedBidding: Sealed bids may be submitted and will be received D1 the office of the Finonce irector at City Hall. 412 E. Washington, Iowa City, Iowa 52440. • Electronic Internet Bidding: Electronicnternet bids will be received al the office of the Finance Washi Washington, Ioor wa Clty, Hall, 52440. The bids must be submitted Through, the SoeerAuctlon competitive, bidding system., Electronic Facsimile Bidding: Electronic Catmi sidnl received the City's Advisor, Speer FlnanClal, Waterloo, Iowa (facsimile number): (319) 291-8629 or (319) le bids will be treated as sealed bid . Consideration of Bids: After the time for receipt of bids hos passed. the close of sealed bids will be announced. Sealed bids will then be publicly opened and announced. Finally, electronic internet bids will be accessed and announed. Sale and Award: The sale and awardofthe Bonds will be held in the Council Chambers, al Emma Harvol Hall, 410 E. Washington St., Iowa City. Iowa at a meeting of the City Council on the above date of 6:00 P.M. Officiol Statement: The Issuer has Issued 01 pertainiStatement the Bonds to beffered, including statement of the Terms of Offering and an Official Bid Form, which Is incorporated by reference os a part of this notice. The Official Statement may be obtained by requestddressed to the City Clerk, City Holl, 410 E. Woshinofon, Iowa City, town 52440 or the Issuer's MUniCiPal Advisor Speer Financial, 531 Commercial Street, Waterloo, Iowa, 50703, Telephone: 319-291.2077. Terms of Offering: All bids shall be in conformity with and the sole shall be in accordance with lne Terms Of ficial Statements set forth the n Legal Opinion: The Bands will be AOlers 81 Cooney. iPC.o Attorneys of Des Moines, lowo, as to the legalityd their opinion will be furnlsned t ether with the printed Bonds wiout cost t0 the purcboser and all bidsIII be so conditioned. Except to the extent necesSary la Issue their opinion a5 to the legality of the Bends, the attorneys will not examine or review or expre55 any opinion with respect to Inc accuracy or a completeness f documents. materials or statements made or furnished connection the suance oto moriseling sale, sf the Bonds. Rights Reserved: The right, is reserved to reiect anyon bids, and to waive any Irregularities as eemedto. be in the best interests of the public. By order of the City Council al the City al lowo City. State of Iowa. Dated this 23rd day of April. 2022. 01 Iowa City. State olllowClerk. City I mai 14 11171r CITY OF IOWA CITY 410 East Washington Street lova City, Iowa 52240-1826 (319) 356-5000 (319) 356-5009 FAX www icgov org City Council Agenda — April 19, 2022 — Regular Formal Meeting Information submitted between distribution of packet on Thursday and 4:OOpm on Monday. Late Addition(s): Regular Agenda 2. Proclamations 2.b. Housing Trust Fund Week Late Handouts(s): Regular Agenda 17. Forest View Relocation Plan — See correspondence from David Sterling, Daniel Daly, Kent Ferris, Loxi Ho ■ kins. 15. 2022 GO Bonds Bidding Procedure — See Updated Preliminary Official Statement. New Issue Date of Sale: Tuesday, May 3, 2022 (Alternate Bid Methods) Between 10:30 and 11:00 A -M., C.D.T. (Closed SpeerAuction) Before 1 I :00 A.M., C.D.T. (Sealed Bids) Official Statement Investment Rating: Moody's Investors Service ,.. (Rating Requested) Assuming compliance with certain covenants. in the opinion of Ahlers & Cooney, P.C., Bond Counsel, under present law and assuming continued compliance with the requirements of the Internal Revenue Code of 1986, as amended (the "Code"), interest on the Bonds is excludable from gross income for federal income tax purposes. Interest on the Bonds is not an item of tax preference for federal alternative minimum tax purposes. interest on the Bonds is not exempt from present Iowa income taxes. The Bonds will NOT be designated as "qualified fax obligations". See "TAX MATTERS" herein for a more ilea s"Di s tri bu ted $10,255,000* CITY OF IOWA CITY Johnson County, Iowa General Obligation Bonds, Series 2022 Dated Date of Delivery Book -Entry (ate) Due Serially June 1, 2023 - 2032 The $10,255,000* General Obligation Bonds, Series 2022 (the "Bonds") are being issued by the City of Iowa City, Johnson County, Iowa (the "City"). Interest is payable semiannually on June 1 and December 1 of each year, commencing December I , 2022. interest is calculated based on a 360 -day year of twelve 30 -day months. The Bonds will be issued using a book -entry system. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the Bonds. The ownership of one fully registered Bond for each maturity will be registered in the name of Cede & Co., as nominee for DTC and no physical delivery of Bonds will be made to purchasers. The Bonds will mature on June 1 in the following years and amounts. AMOUNTS*, MATURITIES, INTEREST RATES, PRICES OR YIELDS AND CUSIP NUMBERS Principal Due Interest Price or CUSIP Principal Due Interest Price or CUSIP Amount" June1 Rate Yield Number(1) Amour' June1 Rate Yield Number(1) $1,315,000 2023 % % $995,000 2028 % % 995,000 2024 % % 995,000 2029 % % 995,000 2025 % % 995,000 2030 % °k 995,000 2026 % % 995,000 2031 % % 995,000 2027 % 9'0 980,000 2032 Any consecutive maturities may be aggregated into term bonds at the option of the bidder. in which case the mandatory redemption provisions shall be on the same schedule as above. OPTIONAL REDEMPTION Bonds due June 1, 2023 - 2028, inclusive, are not subject to optional redemption. Bonds due June 1, 2029 - 2032, inclusive, are callable in whole or in part on any date on or after June 1, 2028, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. See "OPTIONAL REDEMPTION" herein. PURPOSE, LEGALITY AND SECURITY The proceeds of the Bonds are expected to be used to: (i) finance the cost of various essential and general corporate purpose capital improvements, and (ii) pay the costs of issuing the Bonds. See "THE PROJECT" herein. In the opinion of Bond Counsel, Ahlers & Cooney, P.C., Des Moines, Iowa, the Bonds will constitute valid and legally binding obligations of the City payable both as to principal and interest from ad valorem taxes levied against all taxable, real property within the corporate limits of the City without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors' rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. This Official Statement is dated April _, 2022, and has been prepared under the authority of the City. An electronic copy of this Official Statement is available from the www.speerfinancial.com web site under "Official Statement Sales Calendar". Additional copies may be obtained from Nicole Davies, Finance Director, City of Iowa City, 410 E. Washington Street, Iowa City, Iowa, 52240, or from the Registered Municipal Advisors to the City. Speer Financial, Inc. V INDEPENDENT MUNICIPAL ADVISORS• ESTABLISHED 1954 2230 NEST MONROE STREET. SUITE. 2630 • CHICAGO. ILLINOIS 60606 Telephone: 1312) 346-3700 • Facsimile: (312) 346-8833 531 COMMERCIAL STREET. SUITE 608• WATERLOO. IOWA 50701 Telephone: (319) 291.2077 • Facsimile: (319) 291.8628 'Subject to principal adjustmem in accordance with the Official Terms of Offering. (ll CUSIP numbers appearing in this (*ficial Statement have been provided b,'the L'Lx!P Service Bureau, which is managed on behalf of the American Bankers Association by S&P Copilot IQ. a part of5kGr,m Hill finra,cnd Inc. The C'tsr is not responsible n- the selection of CUSIP numbers and makes no representation as to their correctness on the Bowls or as set forth on the corer of this (Vela! Statement. Item Number: 16. 46,, CITY OF IOWA CITY � COUNCIL ACTION REPORT April 19, 2022 Resolution Adopting the Social Justice and Racial Equity Grant Allocations for Fiscal Year 2022. Prepared By: Stefanie Bowers, Human Rights Coordinator Reviewed By: Geoff Fruin, City Manager Sue Dulek, Assistant City Attorney Fiscal Impact: $75,000.00 Recommendations: Staff: Approval Commission: The Human Rights Commission by a 5-0 vote recommends to the City Council the following organizations for funding: Multicultural Development Center of Iowa, Open Heartland, Center for Worker Justice, Great Plains Action Society, IC Compassion, Houses into Homes, Iowa City Area Chinese Association. Attachments: Approved Minutes HRC 2 22 2022 Resolution Exhibit A Executive Summary: The Human Rights Commission recommends full funding for Multicultural Development Center of Iowa, Open Heartland, Center for Worker Justice, Great Plains Action Society, IC Compassion, Houses into Homes, Iowa City Area Chinese Association for the Social Justice and Racial Equity Grant for fiscal year 2022. Background /Analysis: In 2017, the City Council created the Social Justice and Racial Equity (SJ RE) Grant to assist community-based organizations in building capacity to address social justice and racial equity needs. Seventy-five thousand dollars has been allocated yearly for the SJ RE Grant since fiscal year 2019. The Human Rights Commission has recommended to City Council for the amount to be doubled to $150,000. Social justice and racial equity are defined as both a process and a goal. "The goal is full and equal participation of all groups and individuals in a society that is mutually shaped to meet their needs, allow them to reach their full potential, and limit/decrease barriers. This definition includes a vision of society that is equitable, and where all members are physically and psychologically safe and secure." The grant is available to for profit and non profit Iowa City based organizations to fund programs, activities, or services that help eliminate inequities in the community. The grant has six priority service areas: education, building communities, housing, criminal justice, health, and employment. Organizations whose programs, services, or activities address one or more of these priorities are considered first for funding. Applications for the grant were available to apply for from December 1, 2021 to January 7, 2022. The Human Rights Commission met on February 22 to review the nineteen funding requests. By a vote of 5-0 the Commission recommends to City Council to fund the below organizations. The total allocation is $75,000.00. Multicultural Development Center for Iowa (MDC Iowa) has developed a BI POC Business Accelerator program (I NCubate) that provides an intensive training program designed to accelerate the growth and development of new and existing minority-owned businesses in Iowa City. MDC Iowa believes that representation matters and continues to lead by example as an organization with Black leadership, and staff and training delivered by Black, Indigenous, People of Color. Participants in the I NCubate program learn business fundamentals, assess an existing business model or create a new business model canvas, learn about supply chain management, competitive landscapes, identify distribution channels and partnership opportunities, practice presentation skills, work on presentation skills, develop a marketing plan, as well as build a 30 -60- 90 -120 -day strategic plan. The entire 16 -week program is designed to give the participants the tools required to self -actualize their business dreams using the skills learned during the program. Open Heartland through participation in the "We Belong" project participants will build self-esteem and a sense of belonging to a new culture and community. The majority of the adults served by Open Heartland were not able to finish school in their home countries due to lack of access, the necessity to go to work at a very young age, or poverty. The project programs and activities, all with free childcare provided, will be accessible to our clients in their native Spanish language at no cost to increase and promote access. The program activities will impact families by allowing adults and teens opportunities to: improve their abilities to speak and understand English, participate in community conversation groups with native English speakers, become computer literate, gain understandings about the US culture, earn their GEDs, learn new skills to contribute to their economic stability and ability to care for their mobile homes that are in disrepair, and improve their mental health with active involvement in support groups. All We Belong programs are free and will be facilitated during evenings and weekends when kids are not in school during calendar 2022. Center for Worker Justice program involves the development of a public computer lab for community members. The computer lab would have 7 computers for public use, as well as a printer. The lab would offer assistance with filling out/printing forms and applications, and basic computer literacy training and English classes. The lab will provide a shared learning environment providing workshops and educational courses in computer literacy, English language, and other educational subjects. Also, the lab will offer knowledge and assistance to access government assistance programs that contribute to increasing awareness about and reducing illiteracy as a key factor of social inequities. Great Plains Action Society will do a one -day Indigenous People's Day celebration to be held in downtown Iowa City to promote an Indigenous worldview through a community event that includes traditional music and dance, first foods, and cultural activities. This celebration will highlight Iowa City's multicultural efforts through a collaborative effort that aligns with existing organizations and businesses in the area. It will also encourage city -based efforts to improve the visibility of Native American and Alaskan Native populations and issues in the area. Indigenous communities in the United States suffer from the highest rates of missing and murdered people, youth suicide, unemployment, police murders to name a few prominent issues facing our people. It is because we also suffer from extreme erasure by the government and media that these issues are ignored and largely go unknown by settler descendant society. Our event programming will increase community cultural awareness and connectedness through activities, education, and conversations. Our activity falls into the Building Communities, Education, and Health priority areas as it is creating space for Indigenous Peoples who are historically overlooked in Iowa City. It also takes the first steps to truly celebrate Indigenous Peoples' Day in Iowa City, which provides important historical and anti -racism education, which in the end benefits the mental health and well- being of Indigenous Peoples in the area. IC Compassion will create a training cafe within our facility at IC Compassion. The cafe, the Jabez Cafe, is to provide a place for young adults with disabilities and mental health illnesses to work and gain the skills they need for future job opportunities. Adults with an intellectual disability often struggle to find work. Many are under -employed or not working at all. The Jabez Cafe will train individuals 16 years or older, teaching them to live independent lives and provide a place for them to be. It will stimulate a positive environment which does not focus on the things that they cannot achieve, but those that they can. As with IC Compassion's mission, the mission of the Jabez Cafe is to work with people from multi -cultural backgrounds. The cafe will not only impact the trainees, but also the community in which it serves. The cafe will help to provide awareness of the barriers people with disabilities face and stimulate the local economy through purchasing and selling of food and coffee. Houses into Homes will host a Youth Volunteer Academy that will bring together a diverse group of students from across the community to volunteer, get to know each other, and learn about social justice. Weekly volunteering will be accompanied by a monthly learning experience (i.e., Maslow's hierarchy of needs) or restorative circle (i.e., reflecting on your experience today). Students will have a unique opportunity to participate in learning activities with students from different schools, different racial and ethnic groups, and different socio-economic backgrounds. Together students will examine historic and current structures and causes of systemic racism and injustice. The development of the curriculum will be a collaborative effort. Over the summer of 2022, we will form a steering committee of school and community leaders to develop the curriculum and select speakers for each monthly workshop. School sponsors and Houses into Homes staff will be responsible for the mini -lessons and reflections. Iowa City Area Chinese Association will host a Lunar Year Gala. The Gala performance consists of about 12 pieces, including music performance and dances, such as professional saxophone duet, violin duet, youth string ensemble, Children's Chorus Club, Chinese Classic Dance Group, Chinese Folk Dance Club, Qipao Club. Themes range from the delicate elegance of different ethnic ladies to the folk hero of Hong Kong, from the love of parents to the appreciation of kids. Some pieces also touch upon the topic of today's China, shedding light on the desire and wishes of modern Chinese. The celebration will benefit not only the Asian families but also help stop hatred or misunderstanding in the community. We hope to make America a better place and to build Iowa City into a safe and inclusive community for everyone to live and thrive. The Lunar New Year Gala is a brilliant artistic celebration of Asia's largest holiday. The rich cultural heritage will be displayed at the annual Lunar New Year Gala and hope to bring good luck to the audience in the year of the tiger. ATTACHMENTS: Description Approved Minutes HRC 2 22 2022 Resolution Exhibit A CITY OF IOWA CITY MEMORANDUM Date: April 7, 2022 To: Mayor and City Council From: Stefanie Bowers, Human Rights Coordinator Re: Recommendation from the Human Rights Commission At their February 22, 2022, meeting the Human Rights Commission made the following recommendation to the City Council: Multicultural Development Center of Iowa: $10,000.00 Open Heartland: $9,000.00 Center for Worker Justice: $18,000.00 Great Plains Action Society: $5,000.00 IC Compassion: $ 15,000.00 Houses into Homes: $15,000.00 Iowa City Area Chinese Association $3,000.00 Five out of 7 organizations are new to the funding. Motion by Pries, seconded by Sivanthaphanith. Motion passed 5-0. (Maliabo and Ahmed abstained). Additional action (check one) No further action needed Board or Commission is requesting Council direction X Agenda item will be prepared by staff for Council action S:RECform.doc Approved Minutes Human Rights Commission February 22, 2022 Emma J. Harvat Hall Commissioners present: Mark Pries, Tony Sivanthaphanith, Jason Glass, Roger Lusala, Ashley Lindley, Bijou Maliabo, Ali Ahmed (via Zoom). Commissioners not present: Sylvia Jons, Siri Bruhn. Staff present: Stefanie Bowers, Daisy Torres. Recommendation to City Council: Yes. The Human Rights Commission recommends the following organizations for funding from the Social Justice and Racial Equity Grant for FY22. Meeting called to order: 5:32 PM. Land Acknowledgement: Lindley read the Land Acknowledgement. Approval of the minutes from the January 25, 2022, meeting: Pries moved, the motion was seconded by Lusala. Motion passed 5-0. (Ali, Maliabo not present). Public comment of items not on the agenda: None. (Ali present 5:39 PM) Review of Current Commission Subcommittees & Strategic Plan: The Commission will work on strategic planning at their March or April meeting. The planning sessions will include a discussion of subcommittees and areas of focus. Staff will work with the Commission to hire a facilitator who can assist the Commission on their strategic plan. (Maliabo present 5:41) Upcoming meetings: The Commission decided to move its March meeting date from the 22nd to the 29th. Youth Awards: The Youth Awards Ceremony will be held on Wednesday, May 11th. The location has changed from the Englert Theatre to the Hilton Garden Inn. Mayor Teague has agreed to provide remarks at the event. Nomination forms have gone out and staff will reshare that news release with Commission members. The event will start at 6PM with a reception and the ceremony will start at 7PM sharp. Proclamation for International Transgender Day of Visibility: Lindley will accept the proclamation on behalf of the Commission at the March 22nd Council meeting. Night of a 1000 Dinners: Night of a 1000 Dinners will be held virtually on Tuesday, March 8. The event is a community celebration of International Women's Day and is sponsored by the Johnson County United Nations Association. Three local women led organization (Inside Out Reentry Community, IC Compassion, Open Heartland) will be recognized and proceeds will be donated to those organizations plus the UN High Commissioner for Refugees. Maliabo is on the planning committee. Glass has already signed up to attend and Pries will be signed up by staff. Social Justice and Racial Equity Grants: The Commission received 20 submissions for the grant for FY22, one organization withdrew their request. Commissioners Maliabo and Ahmed are not participating in the grant recommendation this year because they both serve on the Center for Worker Justice Board of Directors (CWJ) who submitted an application for grant funding. Staff went over the requirements and rules for the grants. The recommendation to Council for the grants for FY22 is as follows: Multicultural Development Center of Iowa: $10,000.00 Open Heartland: $9,000.00 Center for Worker Justice: $18,000.00 Great Plains Action Society: $5,000.00 IC Compassion: $ 15,000.00 Houses into Homes: $15,000.00 Iowa City Area Chinese Association $3,000.00 Five out of 7 organizations are new to the funding. Motion by Pries, seconded by Sivanthaphanith. Motion passed 5-0. (Maliabo and Ahmed abstained). The Commission will discuss potential changes to the SJRE grant for FY23 at its April meeting date. Reports of Commissioners: Maliabo's daughter was recognized for a climate action certificate. Lindley noted that February 18 was the 80th anniversary of the Japanese American Internment Camps during World War 2. Sivanthaphanith spoke on the anti-LGBT bills being introduced in the Iowa legislator. Lusala has visited local Black owned restaurants to commemorate Black History Month. Pries mentioned working with the Interfaith Alliance and also events he is participating in related to the 1619 project. Glass reminded Commissioners of the upcoming MLK Youth Summit scheduled for February 25. Staff Reports: Torres reported that Kites for Kids will be held in April in Iowa City and also reminded Commissioners that the peanut butter and jelly donation drive to support CommUnity Crisis Services and Food Bank ends on February 28. Adjourned: 6:42 PM. Human Rights Commission ATTENDANCE RECORD YEAR 2022 (Meeting Date) NAME TERM EXP. 1/25 2/22 3/22 4/26 5/24 6/28 7/26 8/23 9/27 10/25 11/22 12/27 Jason Glass 2022 P P Ashley Lindley 2022 P P Mark Pries 2022 P P Roger Lusala 2023 P P Bijou Maliabo 2023 P P Tony Sivanthaphanith 2023 A P Siri Bruhn 2024 P A Sylvia Jons 2024 P A Ali Ahmed 2024 P P KEY: P = Present A = Absent Prepared by: Stefanie Bowers, Human Rights Coordinator, Office of Equity & Human Rights, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5022. Resolution No. 22-107 Resolution Adopting the Social Justice and Racial Equity Grant Allocations for Fiscal Year 2022 Whereas, the City Council approved funding in the fiscal year 2022 budget for Social Justice and Racial Equity ("SJRE") Grants for community-based organizations to build capacity to address social justice and racial equity; and Whereas, the City has disseminated the SJRE Grant applications to Iowa City organizations; and Whereas, the City has received 19 applications for the SJRE Grant for fiscal year 2022; and Whereas, the Human Rights Commission held a meeting to discuss and review applications regarding the allocation of funds for the SJRE Grant for fiscal year 2022; and Whereas, the Human Rights Commission has recommended that Exhibit A be approved; and Whereas, the City Council finds that the SJRE Grant allocations have a public purpose and the public interest will be served by the adoption of the fiscal year 2022 SJRE Grant allocations. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that: 1. The allocation of fiscal year 2022 SJRE Grant funds attached hereto as Exhibit A is hereby approved and adopted. 2. The City Manager or designee is hereby authorized to execute, terminate, or amend SJRE Grant agreements executed in connection with the allocation of public funds. Passed and approved this 19th Attest: day of April ,2022 It was moved by Bergus and upon roll call there were: Ayes: Nays: Absent: x Approved by City Attorrury's Office (Sue Dulek — 04/11/02022) and seconded by 41 ter x Alter Bergus Harmsen Taylor Teague Thomas Weiner the Resolution be adopted, EXHIBIT A Organization Amount Multicultural Development Center of Iowa $10,000.00 Open Heartland $9,285.00 Center for Worker Justice $19,017.04 University of Iowa's Youth Writing Project $7,300.00 $7,300.00 Great Plains Action Society $5,000.00 IC Compassion $15,000.00 Houses into Homes $15,900.00 Iowa City Community School District (Southeast Junior High) $4,864.00 $4,864.00 Kirkwood Iowa City Food Pantry $23,000.00 $10,000.00 Astig Planning, LLC $18,400.00 $18,400.00 Sudanese Community Center $15,000.00 $15,000.00 University of Iowa Mobile Clinic $15,000.00 $15,000.00 Iowa City Area Chinese Association $3,000.00 $3,000.00 Iowa City Catholic Worker $25,000.00 Corridor Community Action Network $9,708.00 League of Women Voters Johnson County DEI Committee $5,000.00 Willowwind $18,725.00 Iowa Chapter of American Student Dental Association $5,440.00 Chapin House $18,000.00 $10,000.00 $9,000.00 $18,000.00 $5,000.00 $15,000.00 $15,000.00 Item Number: 17. 4CITY OF IOWA CITY !kr4gi,'��� COUNCIL ACTION REPORT April 19, 2022 Resolution approving the Forest View Relocation Plan Prepared By: Sue Dulek, Asst. City Attorney Rachel Kilburg, Asst. City Manager Reviewed By: Eric Goers, City Attorney Geoff Fruin, City Manager Fiscal Impact: Total cost is estimated not to exceed approximately $1,400,000. $17,386,108 in ARPA funds is available and a portion of the City's Affordable Housing Fund is available for households ineligible to receive ARPA funds. Recommendations: Staff: Approval Commission: N/A Attachments: Memo (3/17/22) Resolution Executive Summary: This resolution approves relocation assistance in the amount of $15,750 for every household residing in Forest View Mobile Home Park from 6/4/19 to the present. For those households not eligible for ARPA funds, local dollars will be used. The resolution allows households to self -certify their income and authorizes the City Manager to carry out the plan. Background /Analysis: The attached memo dated March 17, 2022 provides a detailed background on the stalled, and ultimately failed, development project proposed in the Forest View Mobile Home Park which has led to hazardous living conditions and severe economic impacts on the households residing in this neighborhood. In March 2021, the City was allocated $18.3 million in ARPA-SLFRF funding and following extensive public input, the City Council prioritized exploring the use of a portion of the City's ARPA funds to relocate the residents of the Forest View to neighborhoods with higher levels of economic opportunity. In addition to a series of City Council Work Sessions discussing the topic, City staff subsequently worked with the Forest View Tenants' Association and the Center for Work Justice to develop the voluntary relocation plan outlined in the attached Resolution. The U.S. Treasury permits the City to provide assistance to households who experienced negative public health and economic impacts due to the pandemic. Per 31 CFR 35.6(b)(3)(ii)(A) (11)(ii), relocation assistance provided to disproportionately impacted households is an enumerated and presumed eligible use of ARPA-SLFRF funds. To ease administrative burden and ensure compliance with the ARPA, the City will use local Affordable Housing Opportunity Funds to administer payments to households who may not qualify as disproportionately impacted underARPA-SLFRF or who relocated prior to the onset of the COVI D-19 pandemic and thus did not experience worsened public health and economic impacts due to the pandemic while in the neighborhood. Estimated total program costs include approximately $1.2 - $1.3 million in relocation payments to assist an estimate 82 - 87 households with moving expenses, down payments, security deposits, rent, or other relocation -related expenses; and no more than $68,000 to administer the program and to enlist local social service agencies to provide resources, referrals, and assistance for households in finding a quality, safe, and affordable housing unit. ATTACHMENTS: Description Staff Memo 3-17-2022 resolution CITY OF IOWA CITY MEMORANDUM Date: March 17, 2022 To: Mayor and City Council From: Geoff Fruin, City Manager Re: Forest View Relocation Proposal Introduction This memo intends to provide a succinct background on the Forest View redevelopment project that has been planned and discussed over the last approximately seven years. It further provides information on the current situation and makes a recommendation for the City to offer voluntary relocation assistance to residents of the manufactured housing park. The idea for a City funded relocation plan first was presented to the City Council in September of 2021 when discussing preliminary uses for the American Rescue Plan Act State and Local Fiscal Recovery Fund (ARPA) that Iowa City was awarded earlier in 2021. As City staff began to work through the federal rules and develop a proposal, we stayed engaged with the Forest View Tenants Association and the Center for Worker Justice. Meetings were held on November 9th and January 19th so that staff could better understand the current situation and so that residents could better understand our views on the project status and need for relocation. Furthermore, a draft of this memo was provided to the Center for Worker Justice on February 11, 2022 to share with the Tenants Association and provide comment back to staff prior to finalizing the memo and forwarding to the City Council. Staff received feedback in the form of the attached letter from the Center Worker Justice on March 10th, 2022. Staff would like to acknowledge the positive, collaborative approach that the Tenants Association has demonstrated. While there may be disagreements on specific matters associated with this complex issue, there continues to be a shared desire to work together toward a positive resolution. This continued collaborative approach will be critical when executing any future relocation effort. Background Forest View is the name of a long-established manufactured housing park located south of Interstate 80 and west of Dubuque Street in Iowa City. In recent years, the term Forest View has also been used to describe a larger 73 -acre area that not only encompasses the existing manufactured housing park but also includes large areas of undeveloped land in the same general vicinity. On the following page there is an aerial image showing the existing manufactured housing park and larger surrounding area In 2017, the City adopted an amendment to the North District Plan that included updated housing, transportation and design goals along with commercial, single-family and multi -family uses for the larger Forest View area. In 2019, the City approved a conditional zoning agreement for redevelopment of approximately 73 acres and reviewed a preliminary plat that included commercial, multi -family, and single-family lots along with nine outlots. The conditional zoning agreement requires, among other conditions, that the development team provide relocation assistance. Since that time, the owner of the property, North Dubuque, LLC, has not been able to commence construction on the redevelopment project. Further, in the last several months it has been communicated to the City that the project will not proceed as originally planned and new buyers and/or project partners are actively being sought. Due to significant changes in market conditions over the last few years, particularly in the commercial and hospitality sectors, it is unlikely any future plat submission will mirror prior proposals. The condition of the manufactured housing park, as well as individual housing units within, have continued to deteriorate in recent years. The number of households residing in the park has dropped precipitously from approximately one hundred at the time of rezoning to less than sixty today. With the hope of redevelopment looming, North Dubuque, LLC has not invested to any great extent in the infrastructure and common spaces. As lot rents have stayed flat and the number of renters has diminished, it is likely that the overall financial viability of maintaining the park has long passed. Furthermore, households living in the Forest View neighborhood have likely been hesitant to pursue needed repairs to individual units due to talks of redevelopment as well as financial pressures directly related to the pandemic. This collective lack of investment has accelerated deterioration of the neighborhood and mobile homes, putting occupying households at a heightened risk of housing instability and significantly impacting their health, safety and quality of life. For the last two years, the City has used emergency housing funds to partner with non-profit agencies and the labor community on critical repairs to individual housing units in the Forest View neighborhood before each winter season. At the urging of remaining residents, the City Page 2 of 12 has also worked with the owner to remove abandoned trailers and eliminate safety hazards. Residents have also reported deteriorating private infrastructure, including roadways and utilities. It appears that temporary repairs are frequently being made to the private infrastructure in the manufactured housing park. In September of 2021, staff proposed using a portion of federal American Rescue Plan Act (ARPA) dollars to relocate remaining residents to safer and more stable housing situations. The relocation effort is intended to prevent an increasingly likely situation of sudden displacement that could be caused by a significant private infrastructure failure or a future decision by an owner to close the manufactured housing park. The relocation effort is intended to proactively provide upfront financial support and connections to social service resources to assist remaining households with relocating to areas of higher economic opportunity and safer housing alternatives of their choosing. Project History and Current Status Conversations surrounding the redevelopment of the Forest View manufactured housing park and surrounding properties started to gain traction in 2015 and 2016. A sampling of milestone dates showing the evolution of this effort are summarized below: • December 2016: The Forest View Mobile Home Park Relocation Plan completed. The plan was prepared by HBK Engineering, LLC in partnership with North Dubuque, LLC, the residents of Forest View Mobile Home Park and the Center for Worker Justice. • August 2017: The City adopted Resolution 19-90, an amendment to the North District Plan that included updated housing, transportation and design goals along with commercial, single-family and multi -family uses for the larger Forest View area. • February 2018: North Dubuque, LLC and Forest View Tenants Association jointly applied for a rezoning and preliminary plat covering approximately 73 acres of land. • May 2018: A revised Forest View Mobile Home Park Relocation Plan was completed. The Plan was prepared by HBK Engineering, LLC in partnership with North Dubuque, LLC, North Dubuque Developer, LLC, the residents of Forest View Mobile Home Park and the Center for Worker Justice. • June 2019: The City Council approved Ordinance 19-4794 — Rezoning 73.15 acres to OPD/RS-12 for 50.82 acres and OPD Highway Commercial (OPD/CH-1) for 20.45 acres and Neighborhood Public OPD/P-1 for 1.88 acres. The applicants included North Dubuque, LLC, and the Forest View Tenants Association. The rezoning was subject to a Conditional Zoning Agreement (CZA). Key next steps before building permits could be approved include a detailed affordable housing agreement and an updated traffic study. The owner also began the process of requesting Tax Increment Financing (TIF) support for the public infrastructure components of the project. The preliminary plat application, however, was incomplete, thus was not approved. • March 2020: Onset of the COVID-19 pandemic and associated economic impacts on households, businesses, and commercial property markets. • June 2021: The OPD Plan expired per City Code standards as no building permits were issued within two years of the plan approval. • Current Status: The City has received no indication that the development will move forward as previously planned. Communications on the implementation of the relocation plan and the required affordable housing agreement stalled back in November of 2019. Page 3 of 12 Portions of the 73 -acre site have been listed for sale. Staff has fielded a few infrequent inquiries from prospective buyers but does not have information to suggest that a sale is imminent. At this time, especially with the continued impact of the pandemic on commercial markets, staff does not see any immediate movement toward redevelopment of this property. Should interest emerge, it will likely be at least a year before a new plan could be prepared, reviewed, approved and commenced. It is not uncommon for projects of this magnitude to take several years to move into a construction phase. Overview of Conditional Zoning Agreement (CZA) The existing CZA, which constitutes part of the zoning code regulating development of this property, imposes conditions on the development necessary to meet public needs created by the rezoning application. One of those public needs created is the need to relocate the current residents upon redevelopment. The CZA requires, among other things, the owner to execute an affordable housing agreement detailing the terms of the relocation assistance before a building permit is issued. The provisions of the agreement shall be guided by the principles of the aforementioned Forest View Mobile Home Park Relocation Plan dated May 2018 attached to the CZA. That plan was prepared by HBK Engineering, LLC in partnership with North Dubuque, LLC, North Dubuque Developer, LLC, the residents of Forest View Mobile Home Park, and the Center for Worker Justice. The affordable housing agreement must be reviewed for compliance with the CZA and approved by the City. Significant points of the Relocation Plan include: • All persons who were residents on the day the CZA was signed (6/4/2019) are eligible for the assistance outlined in the plan. Eligible means any resident that is in good standing with the property and abiding by a current lease (if one exists). • 57 new modular homes were to be built in a new Forest View neighborhood based on the number of income -eligible residents and their desire to remain in the new development. The CZA also outlined several conditions related to the design of the homes. • The owner was to provide the opportunity for income -eligible residents to participate in a lease -to -purchase pathway to homeownership. • Each resident was to receive at least one-year advance notification of the date they must move. • Three replacement housing options were outlined including, (1) moving to a new modular home in the Forest View neighborhood if income -eligible (lease -to -own option), (2) relocating to housing outside the development, or (3) relocating to new multi -family buildings to be constructed within the development (with lease -to -own option). • Units were to be similar in size, function, and location and be decent, safe, sanitary, and affordable. Affordable is not defined in the Relocation Plan. However, conversations at the time anticipated residents being able to start with rent that was comparable to their current lot rent with an annual inflationary factor. • The owner was to hire a relocation coordinator to assist with the relocation activities and options available. • For those moving to a different location or living situation, a maximum replacement housing payment was limited to a maximum of $7,200 per household. This expense was to be covered by the owner. Page 4 of 12 • Moving expenses paid per the Fixed Resident Moving Cost Schedule for Iowa based on number of rooms with furniture. The intent of the affordable housing agreement that is required by the CZA, and yet never finalized, was to move from these general principles to detailed mechanics for satisfying the City Council's intentions. Because the overall development is stalled and unlikely to ever move forward as it was envisioned in 2019, the conditions of the CZA are likewise unlikely to be satisfied. Realistically, staff anticipates a future rezoning will be necessary to move forward with any development and, with that, a new conditional zoning agreement will be needed. Current Site Conditions and Emergency Winter Repairs The current Forest View neighborhood continues to suffer from a lack of investment. The property owner is not reinvesting into the private infrastructure and common areas. Most tenants are similarly not reinvesting in their individual units. This disinvestment cycle will only continue in the coming months until either individual units or the entire manufactured housing park is no longer sustainable. Absent other actions from the owner or City, it is likely that the park's private infrastructure and common areas will continue to rapidly deteriorate and eventually get to the point where there is no other option than to close the manufactured housing park. This eventual course leaves residents with no support resources and risks that they will face sudden and unplanned displacement. State law only requires sixty days of notice to terminate a month-to-month lot lease at a manufactured housing park, and it is staff's understanding that there are not any long- term lot leases in place. Over the last two years, the City has worked to support volunteer -led mobile home repair programs aimed at making individual units in Forest View safer heading into the winter months. In September of 2020, the City approved a $5,000 request by the Iowa City Federation of Labor to support the purchase of materials and volunteer efforts by the local labor community to assist twenty-four households with mobile home repairs. In September of 2021, the City entered an agreement with Habitat for Humanity for $17,500 to provide home repair and weatherization services to Forest View residents. Habitat has commenced work on a number of units and will complete the project and report back to the City on the use of our funds by March 30, 2022. While these emergent home repair programs have provided some relief, they are best thought of as temporary fixes to household units that have for the most part exceeded their intended lifespan. A yearly home repair program is simply not a viable long-term solution for this situation. Relocation Justification and Overview of Possible Scenarios The City of Iowa City does not have a legal obligation to intervene in the current situation at the Forest View neighborhood. Rather, the City's interest is in assisting our residents in relocating to safer and more stable housing and to do so in a way that provides households time to plan and potentially access support resources. Without intervention at this time, there is a substantial risk of sudden displacement, which can be incredibly disruptive and difficult for households to navigate. Sudden displacement situations often do not allow for adequate time to coordinate with needed support services and resources and thus the risk of housing insecurity is greatly increased. Page 5 of 12 While the City is not obligated to offer relocation assistance, the City Council can voluntarily offer such a program. In recent years, Iowa City has twice directed such relocation assistance voluntarily: 1. Rose Oaks (2016): In 2016 a new owner of this multi -family property embarked on a redevelopment and rehabilitation project resulting in the current branded housing development named The Quarters. No rezoning was necessary and no federal or state law triggered mandatory relocation assistance. The City Council directed staff to make a one-time payment of $250 to each household that had a valid lease at the time. A check was mailed to the last address on record for the tenant. This assistance totaled $34,000. The City also funded translation services and contracted with Shelter House for an amount not to exceed $15,000 in HOME funds to assist tenants to secure and rent other units in Johnson County. The City further assisted with some project coordination by placing the property manager in contact with local non -profits, including the United Way, to assist with moving, helping locate units and other assistance. 2. Hawkeye Trailer Court (Prairie Du Chien Road - 2018): The City Council approved a rezoning request in July of 2018 to redevelop an existing mobile home park at 1705 Prairie Du Chien to a multi -family residential property. As part of the Conditional Zoning Agreement, the developer was required to provide a nine-month transition period for the residents to vacate and $2,000 in financial assistance. In addition, an agreement was entered with Shelter House to provide relocation services to the park residents. Shelter House provided $14,958 in direct relocation assistance (up to $2,000 per household) to eight households. Case management expenses from Shelter House totaled $2,598. Total assistance provided by the City through the Shelter House contract was $17,557. In addition to looking at these past examples, the City can craft a program based on the framework required by the federal government when relocation results from federal or federally assisted projects. That regulatory requirement is the Uniform Relocation Act (URA). The purpose of URA is to ensure that persons displaced as a result of federal or federally assisted projects are treated fairly, consistently, and equitably so that such displaced persons will not suffer disproportionate injuries as a result of projects designed for the benefit of the public as a whole. Furthermore, the purpose is to ensure that agencies implement these regulations in a manner that is efficient and cost effective. Under the URA, "displaced persons" (as defined in the regulations) shall receive three types of assistance: 1) replacement housing assistance payments, 2) moving expenses payments, and 3) relocation advisory services. Displaced persons must also receive at least a 90 -day written notice to vacate prior to requiring possession. Regulations for relocation are found at 49 CFR Part 24. Replacement housing assistance payment for a tenant is based on the following formula: 42 months x {(lesser of x or y) — (base monthly rent)}. • X = Average rent and estimated utilities of comparable replacement dwelling • Y = Rent and estimated utilities of a new dwelling occupied by tenant • Base monthly rent = lesser of a) average monthly cost of rent and utilities for reasonable time at current unit prior to relocation, or b) if person is low income (under 80% median income), then it is 30% of "average monthly gross income" (as defined in the regulations). Page 6 of 12 Whatever the total calculated from the above formula, the maximum assistance is capped at $7,200. In practice, low-income households almost always reach the maximum assistance level of $7,200. It should be noted that the 2019 Conditional Zoning Agreement for the Forest View project also utilized the cap of $7,200 when contemplating replacement housing assistance to an off-site unit. To aid in the understanding of this URA calculation, below is an example scenario: Current rent + utilities $750 Rent + estimated utilities of comparable unit x value = $900 $900 (lesser value of x and y) Rent + estimated utilities of newly leased unit y value = $925 Calculation: 42 x {(900-750)} = $6,300 If the household is low-income, a second calculation is necessary: Average gross monthly household income $2,000 Calculation 42 x {900 - (.30*2,000)} =$12,600 Assistance capped at $7,200 Under this scenario, if the household did not qualify as low income, they would receive $6,300 in replacement housing payments, plus moving expenses. If the household is low income, it would receive the maximum of $7,200 in replacement housing payments, plus moving expenses. Tenants have the option of being reimbursed for the actual cost to move or to receive a fixed amount. It has been staff's experience that tenants move themselves and opt for the fixed amount which is based on the number of rooms with furniture. The federal Fixed Moving Cost Schedule for a mobile home with six rooms is $1,100. While the City does not have household information for residents currently living in Forest View, we do understand the base lot rent to be $310. Given the cost of leasing a comparable unit in Iowa City, it is safe to assume the assistance would likely by capped at $7,200 per household, plus moving expenses, under the federal standards. In summary, the City Council has a number of options to consider. As a reminder, there is no legal obligation to pursue a relocation package. However, in staff's view such action is prudent. Thus, the City can look to recent past examples or the commonly used federal standard. A unique opportunity that presents itself with this scenario, is that the City has recently received funding under the American Rescue Plan Act (ARPA). While the City has a plethora of potential options for use of these funds, intervening in this situation to help residents relocate to safer housing that will provide a greater chance for stability and upward economic mobility seems appropriate and consistent with the guidance and intent of this law and the established strategic goals of the City. Key Issues As the City considers an approach to relocation, there are several key factors that must be considered. A brief explanation of these critical issues is addressed below: • Amount of assistance: As discussed above, the amount of assistance to be provided is flexible. While the assistance provided in the Rose Oaks and Prairie DuChein cases provided some benefit to those tenants, the overall amount likely only addressed very short-term, urgent matters and was not intended to provide longer-term stabilizing solutions. The federal URA cap that was also explicitly noted in the Relocation Plan that Page 7 of 12 was jointly developed by tenants and the owner has a cap of $7,200, plus a moving expense allowance. This level of assistance would be more meaningful given the extremely low lot rents in Forest View but would not stretch as far as it may in other relocation situations involving higher existing rental rates. • Funding source: The City budgets $50,000 per year for emergent housing issues including displacement scenarios. Anything beyond the $50,000 will have to come from an unbudgeted source or from other funded City initiatives. The City Council previously signaled support for using federal ARPA funds to facilitate this relocation. U.S. Treasury guidance has recently provided clarification that such a program would be an eligible use of ARPA funds. Utilizing this grant source will spare the City from using unbudgeted funds but will also bring some potential limitations. • Eligibility: The City will need to determine who is eligible for relocation assistance. This includes making decisions on income -levels and current residency versus residency from a date in the past, such as the date of the Conditional Zoning Agreement. Defining eligibility will have significant impacts on overall costs and eligible funding sources. • Timeframe: Once a relocation payment is offered, there will need to be an established timeframe to accept the benefits and vacate the current property. The federal URA standard requires a tenant to be given ninety days before being required to move. Considerations must take into account the park ownership's ability to keep it functioning, as well as key dates including the start of the school year and onset of winter weather. It is important to note that the City cannot force anyone to move, and any relocation payment predicated on a move date is a voluntary matter for residents. • Future affordable housing on the property: Separate from but related to the relocation discussion, staff is working with the current owner to ensure that any future development has a significant affordable housing component. While the City cannot compel land dedication, staff is having conversations surrounding the potential dedication of land to the City that would be banked for future publicly controlled affordable housing. The size of dedication would be approximate to the area on the 2019 preliminary plat that contained the 57 -lot new Forest View residential neighborhood. If a land dedication is not able to be worked out with the owner, staff will lean on the 2019 Conditional Zoning Agreement to ensure any future buyer knows that the community expects a significant affordable housing development to be pursued with the eventual redevelopment of this property. Under either scenario, the future of affordable housing on this site is unknown and could be several years away from materializing. City Staff's Relocation Proposal After careful consideration of the current site conditions, the funding opportunity with federal American Rescue Plan Act (ARPA) dollars, and the lack of any foreseeable progress on site redevelopment, staff is recommending that the City move forward with a relocation package to current residents in the Forest View neighborhood. Based on the March 10th feedback from the Tenants Association through the Center for Worker Justice, staff recommends expanding the pool of eligible residents from current residents (approximately 50-60 households), to households that resided in the Forest View neighborhood when the City staff first proposed the concept of relocation assistance, or September 1, 2021. This would effectively capture any households that moved out in anticipation of the 2021-22 winter months. Page 8 of 12 While the 2019 Conditional Zoning Agreement contemplated assistance to households that lived there at the date of signing (approximately 100 households), broadening that eligibility will significantly increase costs and require alternative, non -grant, funding sources as using ARPA funds for all residents no longer living in the neighborhood is not possible. The development as approved in 2019 is not moving forward and the benefits in that plan will not be realized by anyone. City staff is recommending the City Council focus on the critical, acute need of those that are current residents or moved from the neighborhood since September 1st of 2021. ARPA rules enumerate relocation assistance as an eligible use and presumes eligibility when provided to a disproportionately impacted community. To simplify administration of programs provided to households, the Treasury permits a maximum household income of $40,626 to be considered disproportionately impacted (households can also qualify if they meet certain federal assistance program eligibility limits). Thus, to be eligible for relocation assistance, the City will need to certify households meet this income threshold. The U.S. Treasury encourages self - certification to ease administration and limit barriers and staff concurs with this approach. In addition, staff would aim to create a simple method to satisfy proof of residency requirements. In their March 10th, 2022 response letter, the Center for Worker Justice advocates that the City treat Forest View as a class of households that were disproportionately impacted by COVID. This would allow a few households to receive relocation assistance even if their income is higher than the $40,626 threshold. Proving a disproportionate COVID impact requires quantitative and qualitive data collection and thus could be potentially more intrusive for residents. Essentially, the City would have to show how COVID impacted this neighborhood more than other neighborhoods. It is unlikely that generally stating that loss of employment, educational hardships or other struggles were disproportionally evident in Forest View will satisfy federal requirements. In order to avoid having to satisfy this burden of proof and the associated data collection from residents, staff recommends that self -certification of income (or prescribed federal assistance program eligibility) remain a necessary component of the relocation assistance package. Staff's proposal is modeled after the federal URA standard but recognizes the $7,200 cap, plus moving expenses, in the URA and also detailed in the Conditional Zoning Agreement is likely not sufficient enough to assist households that are only currently paying $310 in monthly lot rent. To determine a relocation amount, staff is proposing using a standard two-bedroom unit size, calculated as follows: Unit Size Fair Market Rent (FMR) Utility Allowance (-) Max Rent (=) Current Lot Rent (-) Monthly Subsidy (=) 24 Months (x) Federal Moving Allowance (+) Total Assistance Per Eligible Household 2 BD $1,036 $116 $920 $310 $610 $14,640 $1,110 $15,750 The formula takes the difference between what is paid today versus the federal Fair Market Rent for our area and multiplies that gap by 24 (months). After adding the federal moving allowance, the total relocation assistance for each household would be $15,750. For the purposes of this relocation program, staff is recommending that each mobile home unit strictly represents one household, regardless of the number or relationship of adult occupants. The $15,750 amount is more than double the federal URA and contemplated 2019 Conditional Zoning Agreement maximum replacement housing amount of $7,200, plus moving expenses. With an estimated 50-60 households living in Forest View today, the total investment from the City will be between $787,500 to $945,000 in household relocation payments plus expenses for Page 9 of 12 partner agencies to provide support services. This number may increase slightly if the City expands eligibility to households that resided in Forest View back to September 1, 2021. It is staff's understanding that disaster assistance funds, including ARPA funds, are not taxable per IRS guidance. However, if the City uses another funding source the payments could indeed be considered taxable income. Relocation assistance of this nature is typically paid in a single lump sum payment. The beneficiary of the assistance has full discretion on how to use the funds and has no obligation to report such use to the City going forward. Thus, it could be used for future rent and utilities, a down payment on a new home, or other needs as determined by the household. Based on feedback from the Tenants Association through the March 10th letter from the Center for Worker Justice, staff recommends that participating households be able to access 25% of the assistance prior to relocation (moving expenses, security deposit, etc.) and the remaining 75% upon move out from the Forest View neighborhood. Staff recommends requiring all households accepting the relocation to vacate the manufactured housing park by December 9, 2022. Avoiding another winter season will greatly reduce the risk of an unplanned, forced displacement. It will also help ensure that persons find safer, more suitable housing opportunities for the cold weather season. Assuming the relocation assistance could be ready by June 1, 2022, the December 9th date provides households six months to find and relocate to safe, quality housing in areas with greater economic opportunity. This exceeds the federal minimum of 90 days and the state landlord/tenant law minimum of 60 days. As we aim for a date beyond the state minimum amount, it should be noted that the owner could move to closure sooner than agreed upon in any relocation plan. If the City Council initiates a relocation program, staff will begin to work with area non -profits that can be resources for residents through this process. The City would offer technical assistance funds to the non -profits in exchange for services to help residents relocate to new neighborhoods of their choosing that provide for higher economic opportunity. Such assistance is encouraged in the ARPA regulations and will help ensure compliance with the final U.S. Treasury rules. As previously noted, the City will continue to work with current owner on the possibility of a land dedication for future affordable housing. The City cannot compel such dedication, but to date the owner has expressed interest in further exploring this partnership. If the City is able to obtain land in this redevelopment area, either from current or future owners, it will be able to oversee the development of an affordable housing project. Typically, the City would take time to determine any goals for the site (level of affordability, permanency of affordability, neighborhood design elements, etc.) and then issue a Request for Proposals to seek development partners. The City would then explore such proposals and determine the feasibility of each and the preferred path forward. This process could take up to a year or more based on past experiences. Furthermore, proposed funding sources could take a while to secure and may limit eligibility of future residents. Realistically, any development of land that may be dedicated to the City is likely several years down the road at best. Knowing that a process like this can be extremely complex, staff does not support making any commitments providing existing Forest View residents any rights of first refusal to undefined affordable projects in the future. Doing so could prove misleading to residents who have already been counting on redevelopment for over five years. Setting up further expectations that the City cannot guarantee may provide additional false hope and may influence decisions on immediate housing choices associated with this relocation effort. Further, any commitments or guarantees may constrain the feasibility of future affordable housing efforts. Some residents may not be eligible to reside in units utilizing certain funding sources due to income levels, citizenship status Page 10 of 12 or other complicating factors. For all of these reasons, staff does not recommend that the City Council make any firm commitments to residents on future affordable housing opportunities in this area. This does not mean that the City cannot vigorously pursue affordable housing on the site and explore scenarios in the future that may prioritize former residents. However, it should be made clear that no guarantees can be made and that the prospect of any future housing should not influence household relocation decisions needed this year. Conclusion There is a long, complicated history with the Forest View redevelopment project. While the best intentions were focused on providing new housing opportunities for residents of the manufactured housing park, the project proved to be infeasible. Unfortuantely, the years of no progress were layered with slowly fading hope which has led to a significant deterioration of the neighborhood and individual housing units. The COVID-19 pandemic exacerbated the issue. Waiting for a private market solution is no longer an option and the City must decide whether to intervene or simply wait for the inevitable closure of the manufactured housing park. The latter would be a lose/lose situation for all involved, including the residents, property owner and greater Iowa City community. Staff is attempting to find a solution that provides meaningful resources for current residents to find new housing in areas of their choosing that will be safer, more stable and provide for greater future economic opportunity. At the same time, we are working with the current owner to try to ensure that broader affordable housing goals that were set forth in the Relocation Plan and the 2019 rezoning are able to be achieved with any future development proposal from a new owner. While these efforts fall short of the lofty expectations that were unable to be achieved from the past redevelopment proposal, they would result in a benefit to current residents, the property owner and the greater Iowa City community. Unfortunately, current site conditions and economic challenges create a situation where time for action is critical. All stakeholders need to work together, and balance drawn out debates on the specifics of this effort with the expediency of a solution. A failure to work together toward a workable, albeit imperfect, solution will increase the likelihood of the aforementioned lose/lose outcome. Staff is happy to answer questions and guide Council through any changes you might wish to pursue to this proposal. City Council Discussion To assist the City Council with discussion on this complex topic, staff has prepared several optional guiding questions with the assumption that there is agreement to proceed with crafting a voluntary relocation program for the Forest View neighborhood: 1. Staff has proposed offering relocation to households that were established in the Forest View neighborhood as of September 1, 2021, the month in which pursuing a relocation was first recommended. Other options include, but are not limited to: a. Current residents b. Residents established in Forest View as of March 3, 2021 c. Residents established as of the date of the Conditional Zoning Agreement (June of 2019) If the Council opts for option (c), consideration should be given to non-ARPA funding sources and potentially limiting assistance to $7200 per household, as was contemplated in the Conditional Zoning Agreement for off-site relocation. Page 11 of 12 2. Does the Council agree that self -certification of income (or eligibility in a prescribed federal assistance program) is a preferred approach over collecting data and information from residents that could potentially show the neighborhood was disproportionality impacted by COVID? The latter may allow those with incomes over the eligible threshold to access relocation funds paid through ARPA. 3. Is the Council comfortable with staff's proposal for a total relocation amount of $15,750 and the plan to offer 25% in advance of moveout and 75% upon moveout? 4. Is there agreement that in order to access the funding households must voluntarily vacate the property by December 9, 2022? 5. Staff intends to contract with a few non-profit organizations to provide relocation support for those needing such services. Accessing support services will be optional for households and not required to access relocation benefits. Is this City Council comfortable with this arrangement or is a strict case management approach preferred? 6. Staff recommends against any guarantee or first right of refusal related to future affordable housing on the 73 -acre redevelopment site. We are comfortable exploring these possibilities should they arise. Is the Council comfortable with this approach? It is possible that the City Council may need more time to process these issues and make final decisions. Once final decisions have been reached, staff will prepare a resolution to formalize the voluntary relocation program. Attachment: March 10, 2022 Letter from the Center for Worker Justice of Eastern Iowa Page 12 of 12 1 Ali CITY OF IOWA CITY 410 East Washington Street Iowa City, Iowa 52240-1826 (319) 356-5000 (319) 356-5009 FAX www icgov org City Council Agenda — April 19, 2022 — Regular Formal Meeting Information submitted between distribution of packet on Thursday and 4:OOpm on Monday. Late Addition(s): Regular Agenda 2. Proclamations 2.b. Housing Trust Fund Week Late Handouts(s): Regular Agenda 17. Forest View Relocation Plan — See correspondence from David Sterling, Daniel Daly, Kent Ferris, Loxi Hopkins. 15. 2022 GO Bonds Bidding Procedure — See Updated Preliminary Official Statement. dfl Kellie Fruehling From: David Sterling <thesterlingillusion@gmail.com> Sent: Sunday, April 10, 2022 1:47 AM To: *City Council Subject: Forestview Tenants Council, Late Handouts Distributed 4-1 ) g la.D.- (Date) I'm writing today to show approval toward member's actions in response to the needs of the Forestview tenants. Utilizing the City's resources to prioritize basic needs is the key to winning the public's trust going forward. That begins with responding to situations like these with actions like these. Going forward, I hope the City considers the economic risks to citizens created by multi -unit landlords as an economic class. It might just be cheaper to buy units from landlords, and sell them to citizens, than to bail citizens out of expensive situations. Appreciate your time. 1 Kellie Fruehling From: Daly, Daniel L <dan-daly@uiowa.edu> Sent: Sunday, April 10, 2022 5:35 PM To: *City Council; Geoff Fruin Subject: Forest View City Councilors and Manager Fruin, Late Handouts Distributed (Date) I'll spare you the too familiar litany of injustices visited upon Forest View residents. You've heard them and acted with compassion. We are proud you serve us. You are very much appreciated. Thank you. Dan Daly Daniel L. Daly 2325 Mayfield Road Iowa City IA 52245-4815 Kellie Fruehling From: Sent: To: Subject: Ferris, Kent <ferris@davenportdiocese.org> Thursday, April 14, 2022 2:26 PM *City Council Re: Support of the families of the Forest View Trailer Park Late Handouts Distributed 4/1 8 /------ (Date) We wish to thank you Mayor Teague and the Alderpeople of Iowa City for your commitment to the families of Forest View Trailer Park. The generosity you have shown has not gone unnoticed by those of us in the Social Action department at the Catholic Diocese of Davenport. Peace and All Good, Kent E. Ferris, OFS Director of Social Action & Catholic Charities, Diocese of Davenport 780 W. Central Park Avenue Davenport, Iowa 52804-1901 563-888-4211 Praise and bless my Lord and give Him thanks and serve Him with great humility. -St. Francis of Assisi, from The Canticle of Brother Sun T) 7 Kellie Fruehling From: Loxi Hopkins <loxihopkins@yahoo.com> Sent: Thursday, April 14, 2022 3:59 PM To: Ferris, Kent Cc: *City Council Subject: Re: Support of the families of the Forest View Trailer Park Looks great Sent from my iPad On Apr 14, 2022, at 2:26 PM, Ferris, Kent <ferris@davenportdiocese.org> wrote: Late Handouts Distributed 1-+ 1 1 / D -.D -- (Date) We wish to thank you Mayor Teague and the Alderpeople of Iowa City for your commitment to the families of Forest View Trailer Park. The generosity you have shown has not gone unnoticed by those of us in the Social Action department at the Catholic Diocese of Davenport. Peace and All Good, Kent E. Ferris, OFS Director of Social Action & Catholic Charities, Diocese of Davenport 780 W. Central Park Avenue Davenport, Iowa 52804-1901 563-888-4211 Praise and bless my Lord and give Him thanks and serve Him with great humility. -St. Francis of Assisi, from The Canticle of Brother Sun 1 E1. Prepared by: Susan Dulek, Assistant City Attorney, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5030 Resolution No. 22-105 Resolution approving the Forest View Relocation Plan. Whereas, Forest View Mobile Home Park (Forest View) is a long-established manufactured housing park in Iowa City; and Whereas, on June 4, 2019, the City approved a conditional zoning agreement (CZA) for redevelopment of approximately 73 acres including the property on which Forest View is located and reviewed a preliminary plat that included commercial, multi -family, and single-family lots along with nine outlots in Ordinance No. 19-4794; and Whereas, the CZA agreement requires, among other conditions, that the owner provide relocation assistance to all households residing in Forest View at the time the CZA was signed; and Whereas, the condition of Forest View, as well as individual housing units within, have continued to deteriorate since the CZA was signed; and Whereas, with the hope of redevelopment looming, the owner has not invested to any great extent in the infrastructure and common spaces; and Whereas, households living in the Forest View neighborhood have likely been hesitant to pursue needed repairs to individual units due to talks of redevelopment as well as financial pressures directly related to the pandemic; and Whereas, this collective lack of investment has accelerated deterioration of the neighborhood and mobile homes, putting occupying households at a heightened risk of housing instability and significantly impacting their health, safety, and quality of life; and Whereas, the owner of the property has not commenced construction on the redevelopment project, and in the last several months, representatives of the owner have communicated to the City that the project will not proceed as originally planned and new buyers and/or project partners are actively being sought; and Whereas, in September of 2020, the City approved a $5,000 request by the Iowa City Federation of Labor to support the purchase of materials and volunteer efforts by the local labor community to assist twenty-four households with mobile home repairs; and Whereas, in September of 2021, the City entered an agreement with Habitat for Humanity for $17,500 to provide home repair and weatherization services to Forest View residents; and Whereas, while these emergent home repair programs have provided some relief, they are best thought of as temporary fixes to household units that have for the most part exceeded their intended lifespan and an annual home repair program is not a viable long-term solution for this situation; and Whereas, at the urging of Forest View residents, the City has also worked with the owner to remove abandoned trailers and eliminate safety hazards; and Resolution No. 22-105 Page 2 Whereas, residents have also reported deteriorating private infrastructure, including roadways and utilities; and Whereas, following extensive public input, Council prioritized using a portion of federal American Rescue Plan Act (ARPA) dollars to relocate residents to safer and more stable housing situations; and Whereas, the relocation effort is intended to prevent an increasingly likely situation of sudden displacement that could be caused by a significant private infrastructure failure, and the owner has communicated to the City its intent to close the manufactured housing park on January 1, 2023; and Whereas, the relocation effort is further intended to proactively provide upfront financial support and connections to social service resources to assist remaining households with relocating to areas of higher economic opportunity and safer housing alternatives of their choosing; and Whereas, it is in the City's interest to assist Forest View residents in relocating to safer and more stable housing and to do so in a way that provides households time to plan and potentially access support resources; and Whereas, the amount of relocation assistance should be based on a standard two-bedroom unit size plus the federal fixed payment moving expense for homes with six rooms, calculated as follows: Unit Size Fair Market Rent (FMR) Utility Allowance (-) Max Rent (=) Current Lot Rent (-) Monthly Subsidy (_) 24 Months (x) Federal Moving Allowance (+) Total Assistance Per Eligible Household 2 BD $1,036 $116 $920 $310 $610 $14,640 $1,100 $15,740 The formula takes the difference between what is paid today versus the federal Fair Market Rent for our area and multiplies that gap by 24 (months). After adding the federal moving allowance of $1,100, the total relocation assistance for each household would be $15,740; Whereas, staff discussions during Council work sessions incorrectly stated the moving allowance as $1,110 and an additional $10 should be added to the above formula for total relocation assistance in the amount of $15,750; and Whereas, because all households residing in Forest View at the time the CZA was signed are eligible for owner provided relocation assistance, households who moved from Forest View after the CZA was signed should receive City provided relocation assistance; and Whereas, to avoid another winter, households should move out of Forest View by December 9, 2022 in order to receive relocation assistance; and Whereas, the U.S. Department of the Treasury (U.S. Treasury) allocated the City of Iowa City $18,325,190 through the State and Local Fiscal Recovery Fund (SLFRF) as part of the American Rescue Plan Act (aka, ARPA); and Whereas, the SLFRF program provides substantial flexibility to each jurisdiction to meet local needs within the four separate eligible use categories outlined in the Final Rule published by the U.S. Treasury on January 6, 2022 and other guidance released by the U.S. Treasury; and Resolution No. 22-105 Page 3 Whereas, an enumerated use of ARPA funds under 31 CFR 35.6(b)(3)(ii)(A)(11)(ii) is "assistance that is provided to a disproportionately impacted household ... including ... relocation assistance...."; and Whereas, not all Forest View households will be eligible for ARPA funds due either to income or categorial ineligibility or to relocation prior to the period in which beneficiaries may have incurred pandemic -related costs under ARPA; and Whereas, it is in the City's interest to provide relocation assistance to all households residing in Forest View when the CZA was signed; Whereas, for those households not eligible for ARPA funds, assistance should be provided with general fund dollars; Whereas, the relocation assistance is completely voluntary, and the City is not requiring or forcing any member of any household to move from Forest View; and Whereas, providing relocation assistance to households residing in Forest View when the CZA was signed is a public purpose. Now, therefore, be it resolved by the City Council of the City of Iowa City, Iowa, that: 1. The following Forest View Relocation Plan is approved. • Eligibility. All households residing in Forest View Mobile Home Park since June 4, 2019, the date the CZA was signed, are eligible to receive relocation assistance. There is one household per mobile home unit regardless of the number or relationship of adult occupants. • Amount. Each household will receive $15,750 in relocation assistance. • Payable. Each household will receive $7,875 upon completion of City required documents and $7,875 upon moving out of the mobile home no later than December 9, 2022. • Self -Certification. Households may self -certify their income using City forms. • City Forms/Translation. City forms will be translated into Spanish. • Timing. All efforts will be made to make the first round of checks available by mid to late May 2022. Checks must be claimed by December 22, 2022. • Agency Assistance. Local agencies will be identified to assist households with locating new housing. Households will not be required to seek the services of an agency as a condition of receiving relocation assistance. • Tax Consequences. Information on the tax consequences of the relocation assistance will be provided. 2. ARPA funds will be used for all eligible households and local funds will be used for all households ineligible for ARPA funds. For purposes of this resolution, households ineligible for ARPA funds means those households not income eligible or categorial eligible and Resolution No. 22-105 Page 4 those households who relocated prior to the period in which beneficiaries may have incurred pandemic -related costs under ARPA. 3. The City Manager is hereby authorized to carry out any actions necessary to effectuate the Forest View Relocation Plan, including but not limited to having the relocation checks issued and entering into agreements as needed with local agencies. Passed and approved this 19th Attest: day of April, 2022. It was moved by Weiner and upon roll call there were: Ayes: X X X X X X X or Approved by • City Attorney' Office (Sue Dulek - 04/13/2022) and seconded by Taylor Nays: Absent: Alter Bergus Harmsen Taylor Teague Thomas Weiner the Resolution be adopted,