City Council to tackle budget Thursday

Levy proposal to remain essentially the same for fiscal year 2023

BY CHUCK VANDENBERG
PCC EDITOR

FORT MADISON - Residents can expect the city's portion of the general levy to remain essentially the same for the next fiscal year beginning July 1.

According to a budget proposal submitted last week by Fort Madison City Manager David Varley, the levy is set at $15.07/$1,000 of assessed valuation. The rate is a tick higher as a formula levy at $15.072 vs. $15.071 in 2021-22.

The city's rate has dropped for the last five years and remains steady for the upcoming year.

The levy is made up of a general levy, a debt service levy, local emergency management levy, employee benefits levy, emergency tax levy, aviation authority levy, and tort liability levy, according to a worksheet included in the budget.

The general levy is maxed out at the state limit of $8.10/$1,000 and cannot be set higher.

The city's debt service levy is a levy issued based upon the city's current general obligation bond debt. That rate for 2022-23 is being proposed at $1.636 which is up about two cents compared to last year. The city currently is paying on just over $3 million in debt on 16 issues including general obligation bonds, TIF districts, revolving loan debt for water and sewer projects, and a Quality of Life bond.

The local emergency management levy is now being collected at the county level and has dropped off the city's levy calculation. That eliminated 1.8 cents from the city's levy last year.

The Employee Benefits levy is projected at $4.838 for the next year. That number is down 2.4 cents per $1,000. The Emergency Tax Levy has been at 27 cents per $1,000 for the past five years. This is a levy allowed if the General Fund levy is maxed out at $8.10.

The city is not collecting an aviation levy and hasn't at least for the past five years, and the tort liability levy is 22.8 cents per $1,000 up just a tick from 22.7 in fiscal year 2022.

Totaling those levies creates the city's mil levy of $15.072, which is projected to generate $2,489,590, down $100,000, according to figures in the budget proposal.

Electric and natural gas franchise taxes are expected to generate $370,000 in the next fiscal year. Cable franchise tax is projected at $96,000.

Highlights of the budget include a $77,000 expense for the Fort Madison Police Department's newly approved K9 program. However, there is also a $77,000 revenue projection in the police budget because it is believed the program will generate donations to offset the costs.

The police budget will also include a Police Detective position at a cost of about $90,000 to assist the Detective Supervisor position.

The city is also projecting a second payment of $715,784 as part of the America Rescue Plan Act federal stimulus, bringing the total the city received to $1,431,569. Varley said a good use of those funds would be to put them toward the cost of mandated sewer separation projects, or toward the cost of a new Public Works Building and Fire Station.

The funds have to be allocated by the end of 2024 and spent by the end of 2026. Varley said those funds are not included as an expenditure in the budget proposal.

The City's Hotel/Motel fund is in a healthier position, according to Varley. The original 2021-22 budget projected revenues at $130,950 due to the pandemic's impact on travel. Revised figures show that revenue at $217,150 and that's the number being projected for 2022-23.

The ending balance in that fund was cut in half in the 2020-21 fiscal year from $172,455 to $88,393 as the pandemic hurt travel. Varley projected that figure to be $51,073 on June 30, but now that figure is being revised to an ending balance of $67,943.

The city's sales tax fund receives and spends the city's portion of its 1% sales tax. The city allocates 80% of that fund to general operations and the remaining 20% is used for streets, sidewalks, capital equipment, and projects.

Revised figures for 2022 have that revenue projected at $1.582 million, and 2023 revenues are projected at $1.662 million. Those numbers would result in $1.33 million into the city's general fund and $332K into capital projects.

Other highlights of the budget include:

• a $30,000 contribution to the Lee County Economic Development Group.
• $65,000 for beautification efforts and $85,000 for nuisance abatement and demolition.
• $100,000 infusion to the city's asphalt overlay and chip seal programs from the general fund, and $200,000 for street maintenance.
• repainting the PORT trail bridge.
• funds to operate and maintain the Amtrak Station.
• a proposal to bond for the remaining Highway 61 improvements, which would increase the debt service part of the city's levy in coming years.