FY2023 Budget At-a-Glance

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Continued Response to 2013 Property Tax Reforms

Several State property tax reform measures continue to increase pressure on the City’s budget:

Property Taxes $100,000 home ► Despite an increase in assessed value, the City anticipates zero growth in taxable valuations in the coming fiscal year, driven by the the lowest multi-family and residential rollback rates since Fiscal Year 2014. ► Ongoing financial impacts caused by COVID-19 include continued lags in revenue for some City services and higher cost of goods, services, and labor. ► Iowa City has taken steps to manage the impacts of tax reform, but maintaining service levels will require continued prudence over the next several years. 3 #VALUE! $814 $833 $866 $876 888 $ 909 $ 928 $ 922 $ $ Water-- 800 cubic feet $328 $328 $328 $328 $328 $328 $344 $362 $362 Sewer - 800 cubic feet $433 $433 $433 $433 $433 $433 $433 $433 $433 Refuse $174 $174 $186 $186 $186 $186 $191 $191 $191 Stormwater $24 $24 $24 $30 $36 $42 $42 $42 $54 Total #VALUE! Percent Change ► Reduced taxability in multi-residential property will be continue to be phased in through 2024 with an estimated $146 million loss in multi-residential taxable value in Fiscal Year 2023. The City does not receive reimbursement (backfill) from the State for this lost revenue. ► Beginning in 2023, commercial and industrial property tax backfill payments (which have historically totaled $1.5 million annually) will be phased out over a five-year period.

FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 F

930

$

900

$

$362

$380

$433

$433

$205

$229

$54

$54

$1,773 $1,804 $1,843 $1,859 $1,877 $1,919 $1,955 $1,962 $1,984 $1,996

1.7% 2.2% 0.9% 0.9% 2.3% 1.9% 0.3% 1.1% 0.6%

Maintaining a Moderate Tax and Fee Environment for Residents and Businesses Sharp increases in property taxes or fees for services can have a significant impact on families’ monthly budgets. We pursue efficient service delivery, review fees annually, and maintain adequate reserves in order to avoid severe, immediate impacts to residents’ household finances. Maintaining a stable environment for the controllable costs of doing business in our community helps to create an atmosphere conducive to business development and expansion. In FY2023, the Refuse rate includes a $3 monthly fee increase ($1.50 for Yard Waste, $0.50 for Recycling, and $1 for Refuse) to support the heightened demand and costs of these services.

$1,000 $1,500 $2,000 $2,500 Annual Financial Impact to Residential Households

-$500 $0 $500

FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 $922 $930 $900 $901 $869 $884 $846

Property Taxes

Stormwater

$54

$54

$54

$60

$60

$60

$60

Refuse $191 $205 $229 $229 $240 $240 $276 Sewer - 800 cubic feet $433 $433 $433 $433 $433 $433 $433 Water-- 800 cubic feet $362 $362 $380 $399 $399 $419 $419 Total $1,962 $1,984 $1,996 $2,022 $2,001 $2,036 $2,034 Percent Change 0.3% 1.1% 0.6% 1.3% -1.1% 1.8% -0.1%

*Property taxes based on house value of $100,000 **FY18 r fuse does not reflect new yard waste fee structure

*FY18 refuse does not reflect new yard waste fee structure

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