Purch Services Agree -funding!MEMORANDUM
April 16, 2003
TO:The Honorable Mayor and City Council Members
FROM:Michael C. Van Milligen, City Manager
SUBJECT:Purchase of Service Agreements
On this agenda, I have forwarded Purchase of Service Agreements for all Agencies
except those funded from the City's General Fund. The legislature is currently
considering a proposal from the Public Strategies Group that would reduce General
Fund revenues by $974,347. This translates into the elimination of up to 19 positions
and would mean a drastic reduction of City services. With this potential shortfall, I am
not at this time presenting Pumhase of Service Agreements that are funded from the
General Fund. If this legislation is not passed, I will be bringing forward the balance of
the agreements for City Council consideration on the May 19th agenda. However, if this
legislation is enacted, the Fiscal Year 2004 budget will need to be brought into balance
and all tax funded appropriations will be subject to review and possible reduction and/or
elimination.
The following Agency agreements are impacted by this delay:
Dubuque Area Labor Management Council
Helping Service of Northeast Iowa
Operation: New View
Project Concern: Foster Grandparent Program
Retired Senior Volunteer Program
Substance Abuse Services Center
Dubuque Humane Society
Michael C. Van Milligen
MCVM:pj
cc: Purchase of Service Agencies
April 16, 2003
<<fname>> <<lname>>
<<agency>>
<<address>>
Dear <<fname>>:
The purpose of this letter is to share with you information that is going to City Council for
their April 21 meeting regarding the Purchase of Service contracts for Fiscal Year 2004.
Normally at this time of year we are taking all of the Purchase of Service contracts
before City Council for approval and these are then forwarded to you for signature. This
year, however, we have been following proposed legislation that would reduce the City
of Dubuque's General Fund revenues by $974,347. This legislation is known as the
Public Strategies Group proposal. Although cities have been lobbying against the
proposal, the legislation is still alive and under serious consideration.
To the extent this legislation is passed, the City will be forced into opening up the Fiscal
Year 2004 budget to bring it back into balance. That means that all tax funded
appropriations will be subject to review and possible reduction and/or elimination. The
City has seven Purchase of Service Agreements funded in whole or in part from
property tax revenues. These agreements will be forwarded to City Council for approval
when we know for certain that the Public Strategies Group proposal, or some variation
of that proposal, is no longer a possibility.
I am attaching a copy of the letter we have sent to the legislators regarding the impact
this could have on the City of Dubuque. I am also forwarding a copy of the letter that is
going to City Council for their April 21 meeting explaining why certain Purchase of
Service Agreements are not being brought forward for their consideration.
If you have any questions please give me a call at 589-4110.
Sincerely,
Michael C. Van Milligen,
City Manager
MVM/pj
Ms. Diane Thomas
Substance Abuse Center
270 Nesler Center
Dubuque, IA 52001
Ms. Kathleen Sullivan
Retired and Senior Volunteer Program
350 North Grandview
Dubuque, IA 52001
Mr. David Runyon
Helping Services of Northeast Iowa
PO Box 372
Decorah, IA 52101
Mr. Chucklsenhart
Dubuque Area Labor Management Council
PO Box 14
Dubuque, lA 52001
Ms. Jane McCall
Human Society
175 North Crescent Ridge
Dubuque, IA 52003
Apdl 3, 2003
VIA E-Mail
<<Email>>
<<CompleteLOCALName Address>>
Re: Public Strategies Group Proposal
Dear <<Title>> <<Last>>
The purpose of this letter is to provide information regarding the magnitude of the effect
the Public Strategies Group Proposal would have on the City of Dubuque. The proposal
reduces budgeted revenues by $974,347 through the following recommendations:
· Eliminate reimbursement of the Homestead Tax Credit (cost to City of Dubuque
-$707,751)
· 20% reduction in Population Allocation Funding (impact-S165,319)
· 20% reduction in personal Property Tax Replacement funds (impact of
-$92,317) and
· 20% reduction in Moneys and Credits Funding (impact-S8,960).
To place this into perspective, you need to first understand that City Council balanced
and certified a FY 2004 budget by March 15, as required by law. To avoid a property
tax increase, the adopted budget included a hiring freeze, rate increases for all the
City's utilities, a new storm-water utility fee, elimination of all Professional Conference
travel and a reduction in all training budgets, and increases in Building, Zoning, and
Ambulance fees.
These actions were necessary to address a 35% increase in health costs ($1,200,000),
a 20% increase in Police and Fire Retirement rates ($312,000), Property, Boiler, and
General Liability Insurance increases of 15%, reduced State funding of $62,800, and
reduced Utility Replacement Taxes of $156,000.
The Dubuque City Council has been fiscally responsible over the years, making
reductions in employment of 65 positions since 1981, an 11% reduction in workforce.
This was accomplished while 15 Police Officer positions were added since 1995.
<<Title>> <<First>> <<Last>>
April 3, 2003
Page 2
The City of Dubuque has avoided a property tax increase for the average homeowner
for the last nine years, with five of those years seeing a property tax decrease, including
the current year's 5% reduction. The average homeowner in Dubuque has seen a tax
decrease of 7% over the last nine years on the City portion of their property taxes. This
takes some of the pressure off of the schools and the County as they consider their
budgets.
The City of Dubuque has been fiscally responsible in all areas. If you combine the City
portion of property taxes, the sewer fee, the water fee, the refuse fee and the
stormwater fee, the average homeowner in Dubuque pays only 34¢ more in Fiscal Year
2004 than they paid in Fiscal Year 1995 for their City services.
The impact of the Public Strategies Group Proposal would mean layoff of up to 19
employees, which would mean a drastic reduction of City services. The alternative
would be to increase property taxes by approximately 6.1%; we have been told this
alternative would not be available to Cities.
I strongly urge you to oppose the recommendations of the Public Strategies Group and
continue to urge your support of an effort to take a comprehensive approach to
reviewing the overall tax structures for the State of Iowa.
Sincerely,
Michael C. Van Milligen
City Manager
MCVM:pj
cc: Governor Tom Vilsack
Mayor Terry Duggan
Dubuque City Council
Susan Judkins, Director of Governmental Affairs, Iowa League of Cities
Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Pauline Joyce, Administrative Services Manager
Bill Baum, Economic Development Director
The Honorable Mike Connolly
Iowa State Senator
3458 Daniels
Dubuque, IA 52001
The Honorable Roger Stewart
Iowa State Senator
3936 317 Avenue
Preston, IA 52069
The Honorable Pat Murphy
Iowa State Representative
155 N. Grandview Avenue
Dubuque, IA 52001
The Honorable Steven Lukan
Iowa State Representative
7365 Columbus Street
New Vienna IA 52065
The Honorable Julie Hosch
Iowa State Senator
22852 Butterfield Road
Cascade, IA 52033
The Honorable Pam Jochum
Iowa State Representative
2368 Jackson
Dubuque, lA 52001
The Honorable Robert Osterhaus
Iowa State Representative
216 Austin
Maquoketa, IA 52060
The Honorable Gene Manternach
Iowa State Represen~tive
9608 Maple Road
Cascade, lA 52033