FY2023 Adopted Budget

replacement and information technology services. Expenditures made from these funds are charged back to departments. All funds are in good condition with healthy balances. Strong balances create reserves that can provide flexibility to deal with unexpected costs. Looking Ahead In summary, this year’s budget is built on a strong foundation of several years of prudent financial decision-making but is nonetheless strained by the significant financial pressures caused by several state level property tax reforms, a sharp decline in the residential rollback percentage, and plateauing taxable property values. The statewide reforms will disproportionately affect growing communities with large multi-residential residential markets like Iowa City. These pressures on the City’s budget will require continued fiscal prudence to maintain the City’s financial position in Fiscal Year 2023 and to prepare for even greater stress on the budget in Fiscal Year 2024. Although we must remain cognizant of these impending challenges, the City is currently in a secure financial position. While staffing and public service investments in previous budgets indicated a strong economic climate during that time, this budget assumes a more cautious approach to maintain these previously established, excellent service levels. The Fiscal Year 2023 operating budget continues to prioritize funding for Strategic Plan initiatives and projects that support our community’s values. Capital investments continue to largely focus on addressing deferred critical infrastructure maintenance. It cannot be understated how rare the flexibility to invest millions of dollars in climate action initiatives, social justice and racial equity, affordable housing, historic preservation, and public health and crisis services is for a municipal government. In recent years, the City has tackled such audacious undertakings while absorbing property tax reforms and continuing to invest in deferred road, facility, and park maintenance, staff positions to serve a rapidly growing community, and healthy reserve funds. The ability to accomplish these goals simultaneously is an exceptional financial feat and our community should be very proud. The capacity to fund these initiatives is the direct result of decades of prudent financial planning by City Councils and staff which will continue to benefit the community even as we anticipate strain on property tax revenue in the coming years. Conclusion and Acknowledgements This budget document reflects Iowa City’s focus on providing high quality municipal services in a fiscally responsible manner. It was crafted with guidance provided by the City Council through the Strategic Plan and adopted Master Plans. The City’s financial condition remains strong despite the pandemic and our reserve levels provide sufficient flexibility to respond to upcoming challenges. While property tax reforms and continued economic impacts from the pandemic will create funding challenges in the upcoming years, with proper planning and realistic priority setting, the City will be able to achieve our long-term goals. In conclusion, I would be remiss if I did not acknowledge the efforts of our department heads, supervisors, and staff in submitting thoughtful and responsible spending plans for the coming year. I would like to specifically recognize the efforts of the Finance Department, led by Finance

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