Final FY25 Adopted Budget

may require new revenue streams. The clearest example of this is with our fare free transit program, which cannot be maintained on existing revenue sources alone. This budget calls for an increase in parking related rates and an eventual increase in the utility tax to maintain this level of service to the community. The City Council and public should expect that similar approaches will be needed to execute on larger discretionary spending desires or new service level initiatives. Capital investments outlined in this budget continue to largely focus on addressing critical infrastructure maintenance. As we look ahead, infrastructure expenses are rapidly outpacing growth in user fees and road use tax receipts. This means that a higher burden is falling to property taxes. The City will need to adapt accordingly in order to fall behind on the progress we have made over the last decade in addressing deferred maintenance with our streets, utilities and parks. Adapting may mean increased borrowing and debt service rates or exploration of new funding sources to relieve property taxpayers, including a local option sales tax. 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 2023-2028 Strategic Plan and various adopted master plans. Although the City’s financial condition is stable, property tax reforms and the current economic environment continue to pose serious challenges ahead and financial prudence is strongly encouraged. A strong financial foundation takes years to build, and Iowa City is fortunate to have such stability. However, that position can be compromised in a short period of time without careful stewardship and restraint. In conclusion, I would be remiss if I did not acknowledge the efforts of our department directors, management team, 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 Director Nicole Davies. Additionally, I would like to recognize the hard work and analysis of Assistant Finance Director Jacklyn Fleagle, Budget Management Analyst Angie Ogden, and Risk Management and Finance Assistant, Michelle Cook. Appreciation also is directed to Deputy City Manager Redmond Jones II who participated on the budget review team. The individuals noted above worked diligently as a team to pull this budget together and I am proud of the work they have performed to present you with this fiscally responsible budget. Sincerely,

Geoff Fruin City Manager

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