Councilman wants voters to have say in new construction

City Council to vote on 2023 fiscal year budget Tuesday


FORT MADISON – City officials are prepared to vote on the fiscal year 2023 budget on Tuesday.

If approved, city residents will essentially see a static property tax levy of $15.07 compared to the current year.

However City Councilman Tom Schulz, who penned a letter to the editor published today by Pen City Current, is unhappy with a transfer of revenue from a fund set up to hold money paid to the city in 2012 by the state to take over responsibility of Hwy. 61 through Fort Madison.


The city is planning on taking between $5 million and $6 million from the $7.5 million currently in the fund to build new fire department and public works facilities.

The city has already spent about $13 million reconstructing the stretch of highway from 2nd to 10th streets. The next phase of 10th to 18th is being estimated at about $8 million.

City Manager David Varley said today if that is the direction the city goes with the new building, the city’s property tax levy will likely go up in 2024.

But Varley and Mayor Matt Mohrfeld said there were no encumbrances on the money received by the state for the highway, and the city can use those funds as they see fit.

A bond referendum to pay for the new facilities would have to go in front of voters, however, the city does not need a referendum to issue bonds to pay for street and highway improvements.

So moving the funds would allow the city to save on the election, as well as get both projects completed, a move that Schulz said sidesteps the voters in making the decision to build the new facility.

“The funds did not come with any legal requirement to utilize the money for highway work only, but the citizens were told this would be the case multiple times. The city council at the time openly promised this as well,” Schulz wrote in his letter to Pen City Current.

“While the current council is under no legal obligation to honor the promise of a previous council, I think we have a strong moral and ethical responsibility to do so.”

Varley said any time the city gets money in that fashion they just don’t dump it in the general fund, they usually create a special fund.

“When it came I wasn’t around here, but I’m assuming that’s what they did. That’s what we normally do, but when the state gave it to the city, there were no strings attached to it,” he said.


Varley said the payment was created based on an assumed amount at the time as to what it would cost to repair it over so many years and they offered that to the city when the state relinquished control of the stretch of highway.

He also said the city doesn’t have answers yet as to what the new building would cost, but he’s probably going to have a projected number on Tuesday for the council.

“We don’t have all those answers yet. The consultant and architect working on the two buildings are working on a conceptualized design with cost estimates and we should have those in a couple weeks. But between that and finishing the highway, we really don’t know what those dollars look like yet,” he said.

Varley said he’s heard feedback on both sides of the issue of using money out of the U.S. Highway 61 fund outlined in the budget, for the construction.

“There’s feelings on both sides of that issue. There are some that feel these are funds that the city received and the city can use them as they best see fit. Other feelings are that it should be spent for that purpose.”

Schulz wrote his opinion isn’t a popular one, but an ethical one. He said he supports building the new facilities and completing the highway project, but the voters should be convinced it’s appropriate.

“In short, we promised the people that the money given to us for the highway would be used for the highway and it should. If we move forward with the other project, as I believe we should, it is because we have convinced the taxpayer it is the right thing to do and they support it. I doubt this opinion will make me popular around city hall, but I think it is the right thing to do.”

Also on the agenda for Tuesday, the council is scheduled to:
• vote to set a public hearing on a proposal to sell two properties at 2709 and 2713 Avenue J to Craig and Margaret M. Abolt for $1. The hearing, if approved, would be set for April 5 at 5:30 p.m.
• hold a discussion without action on downtown streets and sidewalks and how America Rescue Plan Act funding could be a potential funding source.

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