FY2022

To the Honorable Mayor and City Council Members, It is my pleasure to submit Iowa City's operating and capital budget for Fiscal Year 2022. Although Iowa State Code requires formal adoption of an annual budget, a three-year financial plan (FY 2021-2023) and five-year Capital Improvement Program (2021-2025) are also included for planning purposes. The budget is one of the most important documents the City prepares because it identifies the services to be provided and the mechanisms that finance those services. Although the COVID-19 pandemic presented challenges for seeking public input through the traditional avenues, this budget was developed based on feedback received throughout the year from regular planning and engagement efforts, City Council listening posts, the recommendations of City boards and commissions, and direct input to City Council and staff from stakeholders and residents. This budget incorporates diverse priorities while adhering to financial best practices and planning for long-term community needs. This document aims to provide resources to further the City Council’s Strategic Plan priorities, implement master plans adopted by Council, and continue Iowa City's tradition of providing a balanced budget while strengthening core municipal services that our residents value. The budget contains prudent contingency line items and reserve levels which enable the City to maintain service levels in the event of unexpected expenditures or revenue shortfalls -- as was the case with the COVID-19 pandemic which arose during Fiscal Year 2020 and continues to impact the community. Any future modifications of this budget will be fully disclosed to the City Council and general public through formal City Council actions at public meetings, in accordance with State of Iowa law. Throughout the budget compilation process, staff used the City Council’s Strategic Plan to help prioritize expenditure decisions. This approach was balanced with recognition that the full financial impacts of the COVID-19 pandemic are difficult to forecast but will likely continue into Fiscal Year 2022 and beyond. While we remain optimistic that revenue levels will slowly stabilize moving forward, the adopted budget remains largely status quo due to the broader fiscal uncertainties. Given the financial challenges many households and businesses are navigating, this budget approves no new rate increases and a modest reduction to the City’s property tax rate. Accordingly, this budget limits the addition of new staff. The adopted Fiscal Year 2021 budget marked the largest investment in new staff in many years, though many of these positions were frozen as a result of COVID-19 related budget cuts. Fiscal Year 2022 resources will be directed towards filling some of these critical vacancies as the City works towards meeting Fiscal Year 2021 authorized staffing levels. This budget includes a modest addition of 3.00 full-time equivalent (FTE) positions, which includes two position upgrades (+0.25 FTE Landfill Scalehouse Operator and +0.25 FTE Buyer I in the Equipment Division) and the addition of a 1.00 FTE full-time public safety communications specialist in the City Manager’s Office, a 1.00 FTE full-time civilian supervisor, and a .50 FTE half-time civilian community outreach assistant that will focus on the immigrant and refugee population, to support the City Council’s police restructuring plan. Overall, due in part to the City Council’s prudent budgeting over the last decade, Iowa City has been largely prepared to respond to the pandemic’s financial impacts. Despite no new revenue

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