Fiscal Year 2014 Budget Recommendation/TransmittalMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Fiscal Year 2014 Budget Transmittal Message
DATE: January 28, 2013
Dubuque
All- America City
tl h/
2012
I recently read an article entitled "Where You'll Want to Live in 2032," which
summarized a Gallup analysis. It concluded that the best place to live in 20 years will
have tackled unemployment, financial worry, healthcare costs, obesity, and education
challenges. It will be a place where most residents are healthy, optimistic, employed in
good jobs they love, and enthusiastic about their communities." The study identified the
West North Central Region (Iowa, Kansas, Minnesota, Nebraska, North Dakota, and
South Dakota) as the region poised for the brightest future. As Dubuque leads the
country out of the recession and beyond, Mayor Roy D. Buol and the Dubuque City
Council are setting the tone and creating the atmosphere to ensure Dubuque remains a
community where you want to live today and in 2032.
As part of a recent economic development trip Mayor Buol and the Greater Dubuque
Development Corporation took to New York with Governor Branstad, IBM Vice
President Joe Dzaluk agreed to give a testimonial to New York businesses about doing
business in Dubuque. His remarks included the comment, "Dubuque is a city that has
firmly established itself as a national leader in forward- thinking public policies."
The Iowa Economic Development Authority sponsored their annual SMART Economic
Development Conference in May 2012, with over 400 attendees from across Iowa.
Keynote speaker Rebecca Ryan, a nationally known expert on workforce development,
talked about the cities that are on the ropes," including Detroit, Michigan, and
Cleveland, Ohio. She then gave three examples of emerging cities: Charlotte, North
Carolina; Chattanooga, Tennessee; and Dubuque, Iowa!
Affirmation of the leadership role the City of Dubuque is taking on internationally
includes the invitations Mayor Buol receives to speak around the world. He has spoken
at a Brookings Institution conference in Washington, D.C.; IBM conferences in Arizona
and New York; the Global Smart City Summit in Taiwan; National League of Cities
events in Sweden and Germany; the Texas Municipal League Annual Conference in
Grapevine, Texas; the World Cities Summit in Singapore, which had over 18,000
attendees; and most recently at the Smart City Summit in Toronto, Canada, and at the
New Partners for Smart Growth Conference in Kansas City, where he was invited to
conduct three separate breakout sessions. I was also fortunate to speak about the
Dubuque story as a keynote at the IBM Connect 2013 Conference in January 2013, with
over 5,000 registered participants, and conducted a separate one -hour breakout
session at the conference. In this case, I was pinch- hitting for Mayor Buol, their first
choice. These presentations are at no cost to the City as the event sponsors cover the
costs.
Since January 2011, Dubuque has received the following recognition:
• Named a 2012 All- America City by the National Civic League for the second
time in five years
• Ranked #16 in the Top 100 Overall Cities and #3 in the Top 20 Midwest Cities
in the 2012 Leading Locations report — Area Development magazine
• With our local colleges and over 304,000 college students within 100 miles, it
is no surprise that this region was recently selected as the sixth "Brainiest
Metro" in the country. — The Atlantic
• One of 26 metropolitan areas (out of 363) that have completely recovered the
jobs lost during the great recession — U.S. Conference of Mayors
• Ninth among the 392 Largest U.S. Cities for Employment Growth —
Moody'sEconomy.com
• In 2012, Dubuque had a net gain of 1,600 jobs, 11.1% of all the net new jobs
created in the State. Dubuque's job growth rate in 2012 was 2.8 %, far ahead
of the 1.9% job growth rate for Des Moines. Dubuque was the only Iowa
metropolitan area with a job growth rate over 2 %.
• #1 in Iowa for Private Sector Job Growth in 2011 — Iowa Workforce
Development. In 2011, Dubuque had 1,100 net new jobs, or 12% of the state
total, finishing ahead of even Des Moines.
• In 2010, with 3% of the population of the State, Dubuque had 1,200 net new
jobs or 11.2% of the State total.
• Seventh in the nation in Forbes Annual Best Small Places — Forbes
• #5 for resiliency of 361 cities — Institute of Governmental Studies
These recognitions are being achieved while the largest investments in Dubuque's
history are being made. These projects are being accomplished through the strategic
use of debt to allow the implementation of significant, long- lasting capital projects. With
the historically low interest rates, now is the time to implement these major projects.
The City does not just depend on debt to complete City Council priorities. Since July 1,
2009, the City has received over $133 million in federal and state grants and continues
to pursue grants to keep taxes and fees down. The City has applied for $1 million in
flood mitigation funds from the U.S. Economic Development Administration and might
be eligible for tens of millions of dollars from a new state flood program. Both would
help to hold down the stormwater fee and improve the performance of the Bee Branch
Creek Restoration Project. Recently the City received $9.4 million from the Iowa
2
Department of Natural Resources and the Iowa Finance Authority to install over 40
permeable paver alleys.
While there were several questions during the Fiscal Year 2013 City budget process
about increases in City taxes and fees and the amount of City debt, a thorough
explanation was provided at the final budget public hearing. (Video and details
available online at www. cityofdubuque .org /FY2013budget.) One important thing
citizens learned is that, in 2018, Dubuque's taxing bodies could receive as much as $1
million per year when the Dubuque Technology Park tax - increment financing (TIF)
district expires, and as much as $3 million per year beginning in 2020 when part of the
Dubuque Industrial Center West TIF district expires. The City will get about 30% of
these revenues for the general fund, with the rest split among the Dubuque Community
School District, Dubuque County, Northeast Iowa Community College, and others.
How is taxpayer money being used? The top ten capital expenditures for the period of
1997 -2018 are:
Top 10 Capital Projects (1997 -2018)
As always, the budget recommendation is built around the Mayor and City Council goals
and priorities. Sustainability is the underpinning of this entire budget recommendation.
In addition, the budget tries to position the City to catapult past other cities as a premier
place to live, benefitting our local residents and attracting new people to the workforce.
Progress costs money. Stagnation has a cost also. Some of that cost is economic, like
decreases in property values, less private investment, no growth in retail sales.
Stagnation contributes to the cost of City services becoming an increasing burden on
fewer and fewer people. Stagnation actually has a higher cost. Less jobs for our
children and grandchildren, causing them to leave the area. Dubuquers are not
interested in repeating that experience from the 1980s.
Dubuque has been investing in the future —not spending money on short -term
improvements with limited life that will provide only short -term gains —but building for a
solid future. The City completed the major construction components of the 550 -acre
Dubuque Industrial Center West industrial park and is now completing construction of
3
• ro'ect Description
Cost An
199,194,688
1
Streets Project (Engineering & Public Works)
2
Southwest Arterial
98,300,000
3
Parking Ramps
73,111,467
4
America's River Project
70,674,035
5
Water and Resource Recovery Center
64,885,000
6
Bee Branch Creek Project
57,529,830
7
Sanitary Sewer
44,431,974
8
Airport Terminal Project
39,980,848
9
Industrial Parks
36,096,331
10
Stormwater
29,099,313
Total
$713,303,486
As always, the budget recommendation is built around the Mayor and City Council goals
and priorities. Sustainability is the underpinning of this entire budget recommendation.
In addition, the budget tries to position the City to catapult past other cities as a premier
place to live, benefitting our local residents and attracting new people to the workforce.
Progress costs money. Stagnation has a cost also. Some of that cost is economic, like
decreases in property values, less private investment, no growth in retail sales.
Stagnation contributes to the cost of City services becoming an increasing burden on
fewer and fewer people. Stagnation actually has a higher cost. Less jobs for our
children and grandchildren, causing them to leave the area. Dubuquers are not
interested in repeating that experience from the 1980s.
Dubuque has been investing in the future —not spending money on short -term
improvements with limited life that will provide only short -term gains —but building for a
solid future. The City completed the major construction components of the 550 -acre
Dubuque Industrial Center West industrial park and is now completing construction of
3
the 125 -acre Dubuque Industrial Center South at a cost of over $4.8 million, providing
places for existing businesses to expand and new businesses to locate, thus creating
jobs. The City is completing Phase I of the Bee Branch Creek Restoration project and
in Fiscal Year 2014 will begin construction of Phase II, helping to save over 1,150
homes and businesses from flooding. The City has completed Phase I of the
reconstruction of all underground infrastructure and streets, sidewalks, parking, and
lighting in the Historic Millwork District and is now beginning the next phase for $15.5
million to include an intermodal transportation facility ($12.4 million), hundreds of
parking spaces, and the change of streets from one -way to two -way ($3.1 million). In
Fiscal Year 2014, the City will complete the $67 million Water & Resource Recovery
Center replacement, including the capability to create 600 kW of electricity. The City is
in the midst of building components of the Southwest Arterial project. The City is
building a new airport terminal at a cost of $40 million, with the extension of City water
and sewer infrastructure at a cost of approximately $5 million. The $4 million Port of
Dubuque transient boat docks will open in the spring of 2013.
Partnering with Dubuque Bank & Trust Company Development organization, the City
completed the historical renovation of the former firehouse at 22nd and Central to house
Head Start and the educational activities of the Crescent Community Health Center,
helping to anchor the Washington Neighborhood Central Street business corridor.
The budget recommendation includes a $11.0259 per thousand dollars of assessed
valuation property tax rate for Fiscal Year 2014.
The Fiscal Year 2014 recommended property tax rate of $11.0259 per thousand
dollars of assessed valuation is a 2.24% increase from the current Fiscal Year
2013 property tax rate of $10.7848 per thousand dollars of assessed valuation.
While there have been fluctuations along the way, the $11.0259 Fiscal Year 2014
recommended rate is a 10.60% increase over the Fiscal Year 2009 property tax rate, or
a 1.15% average annual increase over that five -year period.
The Fiscal Year 1987 (just prior to implementation of the 1% local option sales tax
where 50% was dedicated to property tax relief) property tax rate of $14.58 per
thousand dollars of assessed valuation was 24.39% higher than the Fiscal Year
2014 recommended property tax rate of $11.0259.
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Fiscal Year
The Fiscal Year 2014 recommended property tax rate of $11.0259 would still
maintain Dubuque as having the second - lowest City property tax rate of the ten
cities in the State of Iowa with a population over 50,000, assuming none of the
cities change their property tax rates. Dubuque (Fiscal Year 2014) is the second -
lowest in the State for the City portion of property tax rate. The highest- ranked
city (Waterloo at $18.21) is 65.16% higher than Dubuque's rate, and the average
($15.85) is 43.77% higher than Dubuque.
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FY 2013 Property Tax Rates vs. Dubuque FY 2014
$15.22 $15.85
$12.60
51 $16.78 $17.27
$17.51 $17.85 $18.21
West Des Moines
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Average w/o Dubuque
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Council Bluffs
While gaming revenues have stabilized, the City is still feeling the effects of the
reduction in lease revenues from the Dubuque Racing Association. When the Diamond
Jo expanded, it was projected that Dubuque Racing Association lease revenues would
decrease 21%, but the actual decrease has been 37.95 %. I n fact, if you compare the
highest lease year revenue from the DRA of Fiscal Year 2007 at $10,143,632 with the
Fiscal Year 2014 projection of $6,525,975, the City will receive $3,617,657 less in lease
revenue.
One of the causes of the Fiscal Year 2014 property tax increase is the increase in
health insurance cost. The City portion of health insurance expense will increase from
$835 per month per contract to $1,015 per month per contract (based on 553 contracts)
which is a 21.6% increase in health insurance costs for an additional cost of $803,275
to the General Fund in Fiscal Year 2014, or a 3.52% property tax impact for the average
homeowner. In the last few years, the City Council has boosted the general fund
reserves and in Fiscal Year 2011, Fiscal Year 2012, and again in Fiscal Year 2013,
some of the General Fund reserves went to bolster the Health Insurance Reserve.
Since the City of Dubuque is self- insured, actual expenses are paid each year with the
City only having stop -loss coverage for major claims.
In addition, the Municipal Fire and Police Retirement System increased the amount of
City contribution. The current payment of 26.12% of Police and Fire employee salary is
mandated by the State to increase to 30.12% of salary, for an additional cost of
$535,362 in Fiscal Year 2014 for the General Fund or a 2.35% property tax impact for
6
the average homeowner. In Fiscal Year 2010, the City was paying 17% of employee
salary into this system.
Also, the Iowa Public Employees' Retirement System increased the required City
contribution rate from 8.67% to 8.93 %, which is an additional cost of $35,939 in Fiscal
Year 2014 for the General Fund, or a 0.15% property tax impact for the average
homeowner.
Therefore, increased pension costs account for 2.50% property tax impact for the
average Dubuque homeowner.
In Fiscal Year 2014, there is generally a 2.5% employee wage increase at a cost of
$1,131,736 to the General Fund, or a 4.95% property tax impact for the average
homeowner.
The Fiscal Year 2014 recommended property tax rate of $11.0259 includes $105,771
for recurring improvement package requests and $198,015 funds for non - recurring
improvement package requests in the Fiscal Year 2014 budget recommendation. This
is almost completely driven by the requirements of the Federal Affordable Care Act.
Elimination of the $105,771 in funds for recurring improvement packages would reduce
the property tax rate from $11.0259 to $10.9772.
The Federal Affordable Care Act is having a tremendous impact on the Fiscal Year
2014 budget ($100,648) and will have an even greater impact in Fiscal Year 2015
($249,828) and beyond. In Fiscal Year 2014, the $100,648 increase in costs will have a
0.44% property tax impact for the average homeowner.
The Affordable Care Act is a health care law that was signed into law on March 23,
2010, that aims to improve the current health care system by increasing access to
health coverage for Americans and introducing new protections for people who have
health insurance.
Effective February 1, 2014, employers with more than 50 full -time equivalent employees
must provide affordable "minimum essential coverage" to full -time equivalent
employees. The definition of a full -time equivalent employee under the Affordable Care
Act is any employee that works 30 hours per week or more on average over a twelve
month period (1,560 hours or more). The twelve month monitoring period for part -time/
temporary employees begins January 1 of each year. If a part- time /temporary
employee meets or exceeds 30 hours per week on average during that twelve month
period, the City must provide health insurance effective February 1. January 1, 2013,
through December 31, 2013, is the first Standard Measurement Period required with the
first provision of health insurance date being February 1, 2014. If we do not offer
coverage to full -time employees as defined by the Act, and at least one full -time
employee receives a premium tax credit, the City will have to pay an annual fee of
$2,000 per full -time employee (excluding the first 30 employees), for an annual cost of
$1,056,000. Employees eligible for a premium tax credit are those whose household
7
income is less than 400% of federal poverty level. The annual fee far exceeds the cost
of providing this health insurance benefit to part -time employees.
The Affordable Care Act is expected to increase employee expense in Fiscal Year 2014
by $100,648 and in Fiscal Year 2015 by $249,828, with incremental increases each
year thereafter.
The impact of the Affordable Care Act on the City operation is broken into two main
categories, Bus Operators and employees in other City departments. Those are further
broken down into employees who are currently classified as part- time /temporary with no
health care benefits that will be one of the following in the future:
• Part- time /temporary employees with no health care benefits, i.e., part -time/
temporary employees who will work less than 1,560 hours per year.
• Part- time /temporary employees who will work 1,560 hours or more per year, who
will have health insurance effective February 1, 2014.
• Employees who are now part- time /temporary and who will become full -time
effective June 1, 2014, and will begin receiving health insurance benefits
effective February 1, 2014, before they transition into full -time positions.
An analysis was done of all part- time /temporary employees in the City to see which
employees could have a reasonable expectation that they would work 1,560 hours or
more, and possibly would have based their personal financial decisions on that level of
income. Also, an operational analysis was done to determine which positions were
needed to work for 1,560 hours or greater.
The definition used for a part- time /temporary employee having a reasonable
expectation of receiving 1,560 hours or greater of paid time was if they exceeded those
work hours in the last three, four or five consecutive fiscal years, based on a five -year
analysis of part- time /temporary hours worked.
In the case of bus operators, there were seven employees who worked 1,560 hours or
greater in the last three, four or five consecutive fiscal years. The hours worked by
these employees were:
Position
FY 2012
Hours
FY2011
Worked
FY2010
FY2009
FY2008
Bus Operator 1
2,174
1,906
1,672
1,651
1,626
Bus Operator 2
2,099
1,808
1,659
1,585
1,594
Bus Operator 3
1,659
1,577
1,622
1,610
1,624
Bus Operator 4
2,184
1,758
1,643
1,618
Bus Operator 5
1,996
1,735
1,654
Bus Operator 6
1,900
1,797
1,674
Bus Operator 7
2,020
1,889
1,676
8
In transit, there are currently eight fixed route runs available for employees to bid on that
are 1,560 hours or more per year (this includes paid leave hours that are required to be
used in the Affordable Care Act eligibility calculations). When the runs are posted for
employee bidding this year, there will remain eight fixed route runs that are 1,560 hours
per year or greater. Employees who select these runs and work 1,560 hours or greater
(including paid leave hours) during the Standard Measurement Period, will be eligible
for health insurance effective February 1, 2014. The Standard Measurement Period is
calendar year, and it began on January 1, 2013, for current employees.
The fixed route runs are bid by seniority. The seven part -time bus operators who
worked 1,560 hours or more in the last three, four or five consecutive fiscal years will be
able to bid on the eight fixed route runs; however, due to their seniority, there is no
assurance they will be able to select one of the eight fixed route runs (six of the seven
are the top eight bus operators in seniority so they will definitely have the option).
The annual hours of work during the Standard Measurement Period for all other bus
operators will be below 1,560 hours (including paid leave hours) and they will not be
eligible for health insurance.
With eight part -time bus operator positions becoming eligible for health insurance
effective February 1, 2014, and the fact that part -time bus operators already receive
some paid leave benefits, Transit Manager Barbara Morck analyzed the cost to make
some of the existing part -time positions full -time positions. The Fiscal Year 2014
budget recommendation includes creating four additional full -time bus operator
positions effective June 1, 2014. The City would then have a total of eight full -time bus
operator positions, adding these four to the existing four. On the effective date of the
full -time positions, four of the fixed route "pick" runs that exceed 1,559 hours during the
Standard Measurement Period (including paid leave hours), will be eliminated. If
additional full -time bus operator positions are created in future years, the number of
fixed route "pick" runs that exceed 1,559 hours during the Standard Measurement
Period (including paid leave hours) will be reduced.
The cost ($40,600) in Fiscal Year 2014 to create eight part -time bus operator positions
with health benefits effective February 1, 2014, and no full -time positions vs. the cost
($41,689) in Fiscal Year 2014 to create eight part -time bus operator positions with
health benefits effective February 1, 2014, and then change effective June 1, 2014, to
four part -time positions with health insurance benefits and four new full -time positions is
a difference of $1,089 for Fiscal Year 2014 and $21,939 for Fiscal Year 2015, the first
full year. This is not an exact calculation because it is unknown at this time who will
actually become the four full -time bus operators as it is a competitive civil service
process, and the determination as to who is selected from the civil service list is based
on competency, as defined in the Collective Bargaining Agreement.
Now, how do part- time /temporary City employees who are not bus operators impact the
City operation and City costs related to the Affordable Care Act requirements?
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Based on a five fiscal year analysis of hours worked by part- time /temporary employees,
there has been a reasonable expectation created for nine employees working part -time/
temporary for the City that consistently receive 1,560 or more hours per year in income.
These employees are broken up by department as follows:
Building Services — Custodian (3)
Finance — Cashier
Finance — Water Meter Service Worker I
Police — Clerk Typist
Park — Maintenance Worker
Recreation — Assistant Golf Pro
Recreation — Golf Maintenance Worker
Therefore, the Fiscal Year 2014 budget shows an increase in cost for health insurance
for these nine employees of $45,677 at $1,015 per employee per month beginning
February 1, 2014, the average cost for health insurance per employee, included in the
Fiscal Year 2014 budget.
In addition, as in the case of all covered employees, these newly covered employees
will pay $1,531.20 per year if they choose a family plan, $1,200.96 per year if they
choose the single plus one plan, and $600.48 per year is they choose single coverage.
The same is true for bus operators.
The City will closely manage all part- time /temporary employee work hours so that
additional part- time /temporary employees do not inadvertently become eligible for this
health insurance benefit. Also, as the employees currently becoming eligible for this
benefit, including bus operators, separate from the City through retirement, etc., each
position will be evaluated to see if the work hours need to continue to be 1,560 hours or
greater.
The following current part- time /temporary City positions were found to work 1,560 hours
or greater in each of the past three, four or five fiscal years, creating a reasonable
expectation they would receive 1,560 hours or greater:
10
In addition to this lis , the part -time Water Meter Service Worker in the Finance
Department was hired on December 20, 2010, with the expectation to work 32 hours a
week, counting on -call time and, in fact, in the first full fiscal year, Fiscal Year 2012,
worked 1,692 hours. Also, the Golf Professional became a City employee on March 1,
2012, with an annual work schedule of 1,950 hours, becoming the tenth non -bus
operator position described here, and is currently covered by the spouse's City health
insurance contract.
Of the ten positions described above, the analysis of need by departments, based on
past and current requests to make these positions full -time, will have all these positions
receiving health insurance effective February 1, 2014, with five of the positions
becoming full -time effective June 1, 2014. The positions becoming full -time include the
Police Clerk Typist, Building Services Custodian I (3) and Finance Cashier. The
additional cost in Fiscal Year 2014 of these positions going full -time June 1, 2014, is
$4,605.
There were other part- time /temporary City employees who worked 1,560 hours or
greater last fiscal year, or in a past fiscal year, and others that were budgeted for 1,560
hours or greater, but did not work that many hours, and their positions will begin to be
scheduled for less than 1,560 hours beginning immediately.
Additional resources other than property taxes are making it possible to keep down the
property tax rate. One method is a multi -year process to more equitably distribute
administrative overhead of the City operation across all funds that began in Fiscal Year
2013. The Enterprise Funds have contributed to the administrative overhead of the City
operation, but the General Fund has always carried most of the financial burden. There
also is an increase in commercial property and industrial property land lease revenues
of $797,835 over Fiscal Year 2013.
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Department
Position
FY
2012
FY
2011
FY
2010
FY
2009
FY
2008
5 Consecutive
Years
Finance
Cashier
1,764
1,659
1,690
1,690
1,669
Building
Custodian
1,622
1,560
1,564
1,592
1,578
Building
Custodian
1,805
1,669
1,657
1,598
1,580
Park
Maintenance
Worker
2,036
1,621
1,689
1,636
1,684
4Consecutive
Years
Police
Clerk Typist
1,659
1,610
1,568
1,600
Recreation
Maintenance
Worker
1,654
1,587
1,643
1,621
3 Consecutive
Years
Building
Custodian
1,752
1,646
1,627
Recreation
Seasonal
Assistant
Golf Pro
1,897
1,643
1,672
In addition to this lis , the part -time Water Meter Service Worker in the Finance
Department was hired on December 20, 2010, with the expectation to work 32 hours a
week, counting on -call time and, in fact, in the first full fiscal year, Fiscal Year 2012,
worked 1,692 hours. Also, the Golf Professional became a City employee on March 1,
2012, with an annual work schedule of 1,950 hours, becoming the tenth non -bus
operator position described here, and is currently covered by the spouse's City health
insurance contract.
Of the ten positions described above, the analysis of need by departments, based on
past and current requests to make these positions full -time, will have all these positions
receiving health insurance effective February 1, 2014, with five of the positions
becoming full -time effective June 1, 2014. The positions becoming full -time include the
Police Clerk Typist, Building Services Custodian I (3) and Finance Cashier. The
additional cost in Fiscal Year 2014 of these positions going full -time June 1, 2014, is
$4,605.
There were other part- time /temporary City employees who worked 1,560 hours or
greater last fiscal year, or in a past fiscal year, and others that were budgeted for 1,560
hours or greater, but did not work that many hours, and their positions will begin to be
scheduled for less than 1,560 hours beginning immediately.
Additional resources other than property taxes are making it possible to keep down the
property tax rate. One method is a multi -year process to more equitably distribute
administrative overhead of the City operation across all funds that began in Fiscal Year
2013. The Enterprise Funds have contributed to the administrative overhead of the City
operation, but the General Fund has always carried most of the financial burden. There
also is an increase in commercial property and industrial property land lease revenues
of $797,835 over Fiscal Year 2013.
11
Recognizing that there is a great deal of uncertainty around the national economy that
has spilled over to negatively affect the local economy, this budget calls for the
continued increase in the uncommitted cash reserve general fund balance that was
implemented annually beginning in Fiscal Year 2010, which in the past was normally an
amount that equals 10% of the general fund, to help weather any economic downturn
with a minimal impact on the delivery of services.
In Fiscal Year 2014, $444,491 will be set aside in DRA Distribution funds for
unexpected expenditures. If these funds are not needed for unexpected expenditures in
Fiscal Year 2014, the balance will be added to the General Fund Uncommitted Reserve,
along with a portion of any surplus in the General Fund at the close of Fiscal Year 2014.
Previously there was a one -time General Fund operating reserve of $1 million
implemented in Fiscal Year 2010, Fiscal Year 2011, Fiscal Year 2012 and Fiscal Year
2013 for health insurance claims exceeding expectations and the possibility of needing
to boost the health insurance reserve. The health insurance reserve is expected to be
fully funded in Fiscal Year 2013, and transfers from the General Fund should not be
required in Fiscal Year 2014. It is anticipated that some of the $1 million set aside in
Fiscal Year 2013 for unexpected expenditures, like health insurance claims exceeding
expectations, will be added to the General Fund reserve.
Adding money to the General Fund uncommitted reserves each year to get it above the
10% level is consistent with the goal of maintaining the City Bond Rating at Aa1 from
Moody's, thereby lowering the City borrowing costs.
On October 15, 2012, the City Council adopted a formal Debt Management Policy for
the City of Dubuque as the City continues the strategic use of debt. While this Debt
Management Policy just put into writing what the City of Dubuque was already doing in
practice, there were some changes to those policies. The most significant components
of the Debt Management Policy include an internal policy of maintaining the City's
general obligation outstanding debt at no more than 95% of the limit prescribed by the
State constitution as of June 30th of each year. As has always been the case, the City
will not use short -term borrowing to finance operating needs. The City will consider
long -term financing for the construction, acquisition, maintenance, replacement, or
expansion of physical assets only if they have a useful life of at least six years. The City
shall strive to repay 20% of the principal amount of its general obligation debt within five
years and at least 40% within ten years. The City shall strive to repay 40% of the
principal amount of its revenue debt within ten years. Total annual debt service
payments on all outstanding debt of the City shall not exceed 25% of total annual
receipts across all of the City's funds. As of June 30, 2013, it is projected the City will
be at 17 %. It shall be the goal of the City to establish an internal reserve equal to
maximum annual debt service on future general obligation bonds issued that are to be
abated by revenues and not paid from ad- valorem property taxes in the debt service
fund, starting with debt issued after July 1, 2013. This reserve shall be established by
the fund or revenue source that expects to abate the levy, and shall be carried in said
fund or revenue source on the balance sheet as a restricted reserve. This reserve does
12
not exist now, except where required by bond covenants. This internal reserve would
be implemented by adding the cost of the reserve to each debt issuance.
The Fiscal Year 2012 -13 assessable values for calculating the statutory debt limit is
$3,633,353,076, which indicates a total General Obligation debt capacity of
$181,667,654. Outstanding G.O. debt (including tax increment debt, TIF rebate
remaining payments and general fund lease agreements) on June 30, 2013, will be
$143,385,856 (78.93% of the statutory debt limit) leaving an available debt capacity of
$38,281,798 (21.07 %). It should be noted that most of the City of Dubuque's
outstanding debt is not paid with property taxes (except TIF), but is abated from other
revenues, except for one issuance for the replacement of a Fire Pumper truck in the
amount of $1,410,000 with debt service of $120,820 in Fiscal Year 2013. Included in
the debt is $24,091,119 of property tax rebates to businesses creating and retaining
jobs and investing in their businesses. There is anticipated to be additional debt of
$5,610,565 to be issued in Fiscal Year 2014 that is subject to the statutory debt limit of
$183,621,403 in Fiscal Year 2014. As of June 30, 2014, the City is estimated to be
at 75.28% of the debt limit, down from 78.93% in Fiscal Year 2013 because the
amount of debt retired in Fiscal Year 2014 exceeds the amount of additional debt
issued in Fiscal Year 2014 and the statutory debt limit increases each year with
the amount of increased assessed value.
Statutory Debt Limit
Fiscal
Year
Statutory Debt
Limit
Amount of Debt
Subject to Statutory
Debt Limit
% Debt Limit
Used
2012
$177,667,991
$142,682,292
80.31%
2013
$181,667,654
$143,385,856
78.93%
2014
$183,621,403
$138,432,564
75.28%
The City also has debt that is not subject to the statutory debt limit. This debt includes
revenue bonds. Outstanding revenue bonds payable by water, sewer, and stormwater
fees on June 30, 2013, will have a balance of $88,243,243. The total City indebtedness
as of June 30, 2013, will be $231,629,099. The total City indebtedness as of June 30,
2012, was $229,155,092. With anticipated debt of $5,610,565 in Fiscal Year 2014,
minus debt being retired, the estimate for total City indebtedness as of June 30, 2014, is
$223,884,013, 3.3% less than in Fiscal Year 2013. The City is using debt to accomplish
the projects that need to be done and to take advantage of the attractiveness of interest
rates in the current market.
Part of the City's Fiscal Year 2013 debt was in the form of a grant from the Iowa
Finance Authority and the Iowa Department of Natural Resources. Through a new state
program, the interest rate was lowered on the Water & Resource Recovery Center State
Revolving Loan Fund debt, allowing the City to borrow $9.4 million more at the same
debt service cost to construct permeable pavers in over 40 alleys.
13
During the Fiscal Year 2013 budget process, a projection of the statutory debt limit
usage was presented at the public hearing to adopt the Fiscal Year 2013 budget. The
following was the projection that was shown during the Fiscal Year 2013 budget
process:
FY13
FY14
FY15
FY16
FY17
FY18
86.15%
84.89%
81.90%
77.16%
74.55%
71.32%
These statutory debt limit usage projections have changed slightly due to being advised
that the $4.5 million Iowa Finance Authority loan for the Caradco project in the Historic
Millwork District is subject to the City's statutory debt limit due to the debt being issued
by the City (an IFA requirement) instead of by the developer; utility extensions were not
requested by property owners for previously annexed areas and, therefore, the debt
was not issued; and the Bee Branch Creek Restoration Project has other grant funding
opportunities that may allow less debt in the future, such as the new State of Iowa Flood
Mitigation Program, an application for an Economic Development Administration grant
and Federal Surface Transportation Program Enhancement funds from Dubuque
Metropolitan Area Transportation Study.
The revised projection of the statutory debt limit usage is as follows:
FY13
FY14
FY15
FY16
FY17
FY18
78.93%
75.28%
73.31%
62.46%
52.90%
46.14%
In the past, the City had budgeted on an annual basis to pay debt service on the cost to
extend utilities to areas that were annexed when they were ready for development.
When development plans are submitted, the City has an extended period of time to
extend utilities. Year after year, those funds are not expended. Beginning in Fiscal
Year 2013, the funds for these projects are not budgeted. They will be added to the
budget and City debt when requested.
Through Fiscal Year 2013, the City had been increasing the use of debt to accomplish
the projects that need to be done. The debt principal outstanding as of June 30, 2013,
is currently $231,629,099. The breakdown of the debt principal outstanding as of
June 30, 2013, is as follows:
Debt Obligation
Principal
Outstanding
6/30/13
General Obligation Essential Corporate Purpose
$ 91,146,452
Tax Increment Notes and Bonds
$ 23,233,310
Economic Development TIF Rebate Agreements
$ 24,091,119
General Fund Leases
$ 135,000
Total Indebtedness Subject to Statutory Debt Limit of $181,667,654
$143,385,856
Percent of Statutory Debt Limit Used as of June 30, 2013
78.93%
Revenue Bonds
$ 88,243,243
Total City Indebtedness as of June 30, 2013
$231,629,099
14
In Fiscal Year 2014, there is anticipated to be an additional $5,610,565 in debt
issued and $13,355,651 in principal of existing debt reduced. Of the $5,610,565 in
new debt to be issued in Fiscal Year 2014, $5,410,565 would apply against the statutory
debt limit. Of the $13,355,651 principal retired in Fiscal Year 2014, $10,436,116 would
be applied against the statutory debt limit.
There was a 2.61 % increase in assessed value effective January 1, 2012, which is the
assessment the Fiscal Year 2014 statutory debt limit is based on. The statutory debt
limit effective June 30, 2014, is $183,621,403. The City will be at 75.28% of statutory
debt limit by June 30, 2014.
The ten -year history of the City's use of the statutory debt limit is as follows:
FY04
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
31.32%
31.81%
31.66%
29.81%
43.27%
43.67%
54.26%
64.07%
80.31%
78.93%
The new five year projection of the City's use of the statutory debt limit from Fiscal Year
2014 — 2018, including all planned debt issuances subject to the statutory limit and
assuming a 2% growth in the City's assessed valuation beginning in Fiscal Year 2015,
is as follows:
FY14
FY15
FY16
FY17
FY18
75.28%
73.31%
62.46%
52.90%
46.14%
You can see that Dubuque is projected to be below 50% of the statutory debt limit within
five years.
Dubuque (Fiscal Year 2014) compares with the other large cities (Fiscal Year 2013) in
Iowa in use of statutory debt limit as follows:
Rank
City
Legal Debt Limit
(5 %)
Percentage of
legal debt limit
utilized
10
Cedar Rapids
463,611,401
75.33%
9
Dubuque
183,621,403
75.28%
8
Des Moines
575,265,296
64.00%
7
Davenport
295,219,101
59.60%
6
Sioux City
192,979,324
57.60%
5
Waterloo
177,771,817
46.71%
3
Council Bluffs
221,438,807
37.10%
2
W. Des Moines
299,934,593
37.00%
4
Iowa City
242,506,850
33.00%
1
Ames
172,669,198
26.63%
Average w/o Dubuque
48.55%
15
The City will also be using more tax increment financing revenues to accomplish
important projects, mostly through the issuance of debt. Some prominent examples are
the $1,72,513 to build a Bus Storage and Maintenance Facility, the $862,000
improvements at the Historical Federal Building, $275,000 Riverfront Leasehold
Improvements, $100,000 Clock Tower Plaza Rehab, $125,000 Downtown Urban
Renewal District ADA Improvements, $1,450,000 Washington Neighborhood Subarea
(Includes Bluff/West Locust) Building Incentive and Rehabilitation Program, $845,000
Historic Millwork District Subarea Building Incentive and Rehabilitation Program,
$1,500,000 Historic Millwork District Plaza, $650,963 Railroad Platform, and $2,000,000
for future industrial park land acquisitions.
The City will be turning back the State of Iowa Department of Transportation RISE grant
of $680,892 to rebuild 7th Street from the railroad tracks east, as that project has
experienced cost and railroad negotiation issues that will remove it from the current City
CIP plans. The section of 7th Street west of the railroad tracks will continue as a City
project.
Due to a variety of factors including the new TIF legislation that eliminates cities from
receiving the Instructional Support Levy beginning in FY 2014, the City is facing a
modest deficit fund balance in the Greater Downtown TIF District over the next four
fiscal years, which is hindering the ability of the Greater Downtown TIF District to
support any new debt or any new capital improvements program during the same period
of time. Long -term, the City has significant unrestricted assets in this TIF area, however,
short term, there is no surplus TIF income available that can support even a modest
capital plan over the next four years.
As a result, the City is recommending refunding, on a current basis, the June 1, 2014
maturities of several outstanding bonds totaling $850,000, on or around June 1, 2014.
The refunding will have the effect of stretching out the bonds due June 1, 2014 over a
longer period of time, which will remove the short -term stress on the Greater Downtown
TIF District, and allow for a modest capital improvement program payable from Greater
Downtown TIF District over this same period of time. Unlike other recent refinancings of
prior City debt, this refinancing will not result in interest cost savings over time; rather, a
modest interest cost increase will occur as this amount of debt will be stretched out over
a longer period of time than the prior debt was outstanding. However, this step is
necessary in order to assure cash balances and solvency in the Greater Downtown TIF
District fund and still provide available money for certain needed capital improvements.
A "current refunding" is the simultaneous swap of one loan obligation for another loan
obligation, where interest ceases on one on or around the same time as it begins on the
other. The City considers this refinancing to be a one -time event and does not
reasonably expect that this approach will have to be used in the future.
The City will be using some of the DRA lease revenue and the 20% and 30% local
option sales tax allocation for debt service, consistent with previous plans.
16
The City has been able to minimize the impact of the cost of City services to the
average homeowner, in spite of the fact that gaming lease revenues have decreased
$19 million from Fiscal Year 2009 through Fiscal Year 2018.
The City continues to apply for Federal and State grants to minimize the amount of local
dollars needed for City projects. Since February 2009, the City and its partners have
received $163 million in grants. In addition, the America's River III Project for the Bee
Branch Creek Restoration Project has received $125,000 in donations. As always, the
City continues to seek donations for this project and all other City projects.
The recommended property tax rate of $11.0259, while only being a 2.24%
increase in the property tax rate over Fiscal Year 2013, will be a 4.90% increase to
the "City" share of property taxes for the average homeowner, assuming the
Homestead Property Tax Credit is fully funded by the State of Iowa. It is important
to remember that the impact of the property tax rate on revenue to the City and cost to
the average homeowner is impacted by the increase in the City's assessed valuation,
(increasing it from $3,639,539,061 in Fiscal Year 2013 to $3,678,413,719 in Fiscal Year
2014, a 1.07% increase), excluding TIF District Revenues, and the change in the State
rollback factor, which is going from 50.752% to 52.817 %, as determined by the State of
Iowa.
The "City" share of commercial property taxes will increase 2.24 %, as commercial
property is not affected by a rollback factor.
The "City" share of industrial property taxes will increase 2.24 %, as industrial
property is not affected by a rollback factor.
In 2013, the Greater Dubuque Development Corporation will complete raising funds for
the five -year plan titled, "The NEXT Campaign," with an $8.5 million goal to fund their
operation for the next five years. Greater Dubuque Development Corporation President
and CEO Rick Dickinson and Campaign Chair Chad Chandlee have raised $9 million. I
believe this demonstrates tremendous support for the work of GDDC and the
community's economic development efforts.
As I mentioned, the Fiscal Year 2014 budget recommendation includes a 2.24%
increase in the property tax rate. It also includes, with the continued
implementation of the $67 million Water & Resource Recovery Center renovation
and compliance with the EPA Consent Decree, a 17% sanitary sewer rate
increase, a 9% water rate increase, a 9% refuse rate increase and, with the
continued implementation of the over $60 million Drainage Basin Master Plan to
relieve over 1,150 homes and businesses from flooding, no stormwater fee
increase.
The Fiscal Year 2014 budget and changes that have occurred during Fiscal Year 2013
increase the full -time personnel complement by 3.67 FTE, increase the part -time
17
equivalents by 5.49 FTE, and increase the seasonal by 1.07 FTE. The changes can be
summarized as follows:
Decrease in Airport part -time Service Worker for 0.42 FTE for 864 hours annually.
Increase Building Services part -time Custodian I from part -time to full -time effective
June 1, 2014, for 0.02 FTE.
Increase Building Services part -time Custodian I from part -time to full -time effective
June 1, 2014, for 0.02 FTE.
Increase Building Services part -time Custodian I from part -time to full -time effective
June 1, 2014, for 0.02 FTE.
Eliminate Building Services part -time Custodian I for 18th Street building for 0.25 FTE.
Eliminate City Clerk seasonal Intern document scanning position for 0.25 FTE.
Eliminate City Manager's Office seasonal Intern document scanning position for 0.25
FTE.
Additional Engineering Confidential Account Clerk to assist Stormwater approved during
Fiscal Year 2013 for 0.62 FTE or 1,290 hours annually.
Six additional Seasonal Engineering Aides for 1.50 FTE to assist with home inspections
approved during Fiscal Year 2013.
Increase in Seasonal Engineering Aide for 0.14 FTE to assist with street projects
approved during Fiscal Year 2013.
Increase Finance part -time Cashier from part -time to full -time effective June 1, 2014, for
0.02 FTE.
Housing Circles Coach increased to full -time in Fiscal Year 2013 effective January 1,
2013, for an additional 0.35 FTE in Fiscal Year 2014.
Housing full -time Self- Sufficiency Coordinator approved Fiscal Year 2013 effective
January 1, 2013, for an additional 0.50 FTE in Fiscal Year 2014.
Housing part -time Receptionist upgraded to Secretary effective January 1, 2014, and
hours reduced to 1,500 annually -0.03 FTE.
Information Services Helpdesk Position for Smarter Sustainable Dubuque programs and
activities approved Fiscal Year 2013 effective January 1, 2013, for an additional 0.50
FTE in Fiscal Year 2014.
18
Addition of full -time Landfill Equipment Operator II approved during Fiscal Year 2013
+1.0 FTE.
Part -time Library Assistant upgraded to Library Aide during Fiscal Year 2013 for no
change in FTE.
Part -time Secretary shared between Park and Recreation approved Fiscal Year 2013
effective January 1, 2013, for an additional 0.25 FTE in Fiscal Year 2014.
Full -time Park Maintenance Worker upgraded to Assistant Horticulturalist during Fiscal
Year 2013 for no change in FTE.
Recreation Golf Professional reclassified as part -time from contracted services during
Fiscal Year 2013 +0.94 FTE.
Reduction of Recreation Field Supervisor in Children Activities to reflect actual
programming -0.07 FTE.
Four part -time Transit Bus Operators upgraded to full -time effective June 1, 2014, for an
increase of 0.08 FTE.
Addition of part -time Bus Operators approved during Fiscal Year 2013 +0.98 FTE.
Additional part -time Bus Operators recommended for second year of Nightrider and
Midtown Routes, which are funded primarily by the Iowa Clean Air Attainment Program,
+3.79 FTE.
Additional full -time Water Plant Operator for 1.00 FTE effective July 1, 2013
Two Parking part -time Laborers for the Intermodal Facility effective January 1, 2014, for
0.50 FTE.
Increase Police part -time Clerk Typist from part -time to full -time effective June 1, 2014,
for 0.02 FTE.
Eliminate full -time Public Works Research and Energy Analyst position, approved in
Fiscal Year 2013, due to funding source not secured.
In Fiscal Year 1981, the City of Dubuque had 588.25 full -time employees. Despite the
addition of many new services, like recycling, inspections, etc., the City today has
560.72 full -time employees (assuming this budget recommendation is approved).
Since 2006, the Mayor and City Council have identified becoming a more Sustainable
City as a top priority. Again this year, the Council has included sustainability in their
priorities.
19
These Council directives, in addition to the community- defined vision that "Dubuque is a
viable, livable, and equitable community," guided the City's activities in Fiscal Year
2013, and will continue to do so in Fiscal Year 2014. In tight economic times,
sustainability can be a strong lens through which to make policy decisions and can be a
tool for community and economic development in Dubuque.
The City of Dubuque is becoming a more sustainable city by using the community -
defined vision of sustainability and the 11 sustainability principles to guide capital
project decisions, budget decisions that directly impact Dubuque residents and
businesses, and the development of public /private partnerships that help to achieve the
goals.
Proposed capital projects are analyzed using a long -term cost - benefit analysis that
focuses on environmental integrity, economic prosperity, and social /cultural vibrancy.
The Southwest Arterial is being designed to minimize construction and vehicle traffic's
environmental impact in the most cost - effective way possible, including elimination of
truck traffic from the downtown and residential streets, allowing for the development of
complete streets in these areas while creating opportunities to help existing businesses
grow and attract new jobs to the area.
The City is investing in the redevelopment of the Historic Millwork District. The use of
stormwater management best practices and complete streets concepts will result in
cleaner water and improved, walkable streetscapes, with easy access to public
transportation. The City is also developing green space in the District, working with
developers to provide incentives that will revitalize green buildings containing mixed -
income housing, and assisting in the rehabilitation of buildings that will provide many
opportunities for the growth of the regional economy.
Historic preservation is defined as one of the truest forms of sustainability. The City's
Downtown Rehabilitation Loans, Historic Preservation Loans, Homeowner
Rehabilitation Program, and Homeownership Grants in Targeted Neighborhoods enable
businesses and residents to implement sustainability concepts into their neighborhoods.
The City organization cannot achieve community sustainability alone. The Smarter
Sustainable Dubuque project, in partnership with the Greater Dubuque Development
Corporation, ECIA, the Dubuque Area Chamber of Commerce, the Community
Foundation of Greater Dubuque, the State of Iowa Office of Energy Independence, the
Iowa Department of Transportation, the Federal government and others, is giving the
Dubuque community access to technology and data that will guide better decisions
about the way we use resources, create jobs, and save Dubuquers money. City staff
also appreciates our partners in the HEART program, Dubuque Works, Every Child 1
Every Promise, ECIA's Petal Project green business certification program, Project
Hope, Proudly Accessible Dubuque, and many other community -led initiatives that are
helping Dubuque become a more Sustainable City.
20
The City Council has decided that job growth and economic development are very
important.
In March 2009, six months after the meltdown of the international financial markets, the
Mayor and City Council passed the Fiscal Year 2010 City budget with no property tax
increase for the average homeowner, no employee wage increase, and added $1
million to the City's reserves to prepare for any potential local fiscal emergency caused
by the international crisis.
The City is well - positioned to take advantage of the revival of the national economy with
economic development projects that are expected to add hundreds of jobs to the local
economy. In 2012, the U.S. Conference of Mayors identified Dubuque as one of only
26 metropolitan areas in the country to have completely recovered all the jobs lost
during the great recession.
Several significant projects are designed to continue the City's momentum, while also
having the side benefit of short -term construction job creation.
The City is creating a new industrial park off of Highway 20 at Seippel Road in Fiscal
Year 2013, at an estimated cost of $4.8 million dollars.
The completion of the 255,000 square foot Roshek Building renovation not only helped
preserve the McKesson print shop jobs in the lower level and provided space for IBM to
create 1,300 jobs; it preserved an anchor for the downtown that is platinum LEED
certified and on the National Historic Register. Heartland Financial has now leased the
entire 3rd floor of the building, putting 100 employees in the building.
The partnership on the renovation of the over one million square feet of space in the
Historic Millwork District will provide new residential, commercial, and retail space that
both adjoins the Washington Neighborhood and the downtown, providing hundreds of
long -term jobs and hundreds of living units when the rental vacancy rate is less than
4 %. The City has received over $20 million in grants and low- interest loans to
implement the Historic Millwork District Master Plan. Gronen Restoration has
completed the 72 apartment residential component of the building and is completing the
commercial space, including home of the first grocery co -op in Dubuque.
The City's partnership on redevelopment of the riverfront is unabated. Examples
include the recent construction of the Flexsteel Corporate Headquarters; the Port of
Dubuque Public Parking Ramp; the Mystique Ice Center on Chaplain Schmitt Island by
Dubuque Ice & Recreation Center, Inc. (DICE), along with bringing U.S.H.L. hockey
back to Dubuque; the expansion of the National Mississippi River Museum and
Aquarium, with the creation of the Rivers to the Sea and the outdoor amphitheater
connecting the two facilities; the transient boat docks and the partnership with Newt
Marine to revitalize the South Port and the America's River III Project along 16th Street
creating amenities; along with the Bee Branch Creek Restoration Project. Master
Planning will commence in Fiscal Year 2013 for Schmitt Island.
21
The City continues implementing important transportation projects. Property acquisition
and final design continues on the Southwest Arterial, and construction began in 2010.
Comparing the Dubuque unemployment rate with the U.S. unemployment rate annually
since 1980 would indicate that the City is weathering the economic downtown better
than others and better than the City did in the past, indicating that the City is well
positioned to benefit from an economic recovery.
Historical Chart - Unemployment Rate
1980 -2012
Annual Unemployment Rate
Year Dubuque United States Difference
1980 8.6 7.1 +1.5
1981 10.7 7.6 +3.1
1982 14.2 9.7 +4.5
1983 12.1 9.6 +2.5
1984 8.5 7.5 +1.0
1985 9.6 7.2 +2.4
1986 7.8 7.0 +0.8
1987 6.1 6.2 -0.1
1988 5.5 5.5 0.0
1989 6.0 5.3 +0.7
1990 5.9 5.6 +0.3
1991 6.1 6.8 -0.7
1992 5.5 7.5 -2.0
1993 4.1 6.9 -2.8
1994 3.7 6.1 -2.4
1995 3.7 5.6 -1.9
1996 5.8 5.4 +0.4
1997 3.9 4.9 -1.0
1998 3.2 4.5 -1.3
1999 2.7 4.2 -1.5
2000 3.3 4.0 -0.7
2001 3.7 4.8 -1.1
2002 3.5 5.8 -2.3
2003 4.2 6.0 -1.8
2004 4.5 5.5 -1.0
2005 4.4 5.1 -0.7
2006 3.8 4.6 -0.8
2007 4.0 4.6 -0.6
2008 4.3 5.8 -1.5
2009 6.1 9.3 -3.2
2010 6.3 9.6 -3.3
2011 5.5 8.9 -3.4
2012 4.9 8.1 -3.2
22
From 1980 to 1990, the Dubuque unemployment rate was less than the national
unemployment rate only once. Since 1991, the Dubuque unemployment rate has been
lower than the U.S. unemployment rate 22 of those years, with only one (1996) being
higher by 0.4 %. The national unemployment rate for 2012 was 8.1 %, and the Dubuque
rate was 4.9 %.
The City is accomplishing this progress by leveraging outside resources. Since
February 2009, the City and its partners have received over $163 million. The following
is a list of recent grants received by the City only.
Grant
Project
Award
Amount
Iowa Department of Natural Resources
State Revolving Loan Fund Sponsored
Project Program
Bee Branch Watershed
Green Alley Project
$9,400,000
Community Development Block Grant
Caradco Building
$ 8,900,000
State of Good Repairs Grant
Intermodal Facility
$ 8,000,000
Federal Aviation Administration
Airport New Terminal
Project Construction
$ 7,082,854
Transportation Investment Generating
Economic Recovery (TIGER)
Millwork District Complete
Streets
$ 5,600,000
State Revolving Loan Fund Green
Project
Upper Bee Branch
$ 4,400,000
Federal Aviation Administration
Airport New Terminal
Sitework
$ 3,795,911
State of Iowa I -JOBS
Lower Bee Branch
$ 3,950,000
Lead Paint Grant
Lead Paint Removal
$ 3,090,000
Federal Aviation Administration
Airport New Terminal
Project Apron
$ 2,803,094
U.S. Department of Transportation State
of Good Repair
Bus Replacements
$ 2,300,000
Vision Iowa RECAT
Bee Branch Restoration
$ 2,250,000
Federal Aviation Administration
Airport New Terminal
Project Design
$ 1,944,471
U.S. Economic Development
Administration
Central Parking Ramp
$ 1,500,000
Iowa Finance Authority Workforce
Housing Loan
Caradco Building
$ 1,500,000
U.S. Department of Transportation Clean
Fuels
Bus Replacement
$ 1,500,000
Iowa Power Fund
Smarter City Initiative
$ 1,400,000
U.S. Housing and Urban Development
Green and Healthy Homes
$ 1,000,000
State Revolving Loan Fund Green
Project
Smart Water Meters
$ 1,000,000
National Scenic Byway MRT Route
Bee Branch Trails
$ 1,000,000
23
Grant
Project
Award
Amount
U.S. Department of Transportation:
Transportation and Community and
System Preservation
9th to 11th Street One -Way
to Two -Way Conversion
$ 600,000
Iowa Department of Transportation RISE
Grant
Airport Highway 61
Entrance
$ 575,782
Energy Efficiency Conservation Block
Grant
Comprehensive Strategy
$ 574,700
State of Iowa I -JOBS
Southwest Arterial
$ 558,967
Homeless Prevention Funds
Homeless Prevention
$ 502,294
U.S. Department of Transportation:
Transportation and Community and
System Preservation
Loras Parkway
$ 500,000
State Competitive EECBG
US 52 Traffic Flow
Optimization
$ 500,000
Department of Transportation Small
Community Air Service Grant
Air Service Enhancement
$ 500,000
U.S. Department of Energy Smart Grid
Access
Smarter Sustainable Iowa
$ 500,000
U.S. Environment Protection Agency
(EPA) Climate Showcase Communities
Smarter Sustainable
Dubuque
$ 473,136
Neighborhood Stabilization Program
Purchase of Foreclosed
Homes
$ 444,000
Federal Aviation Administration
Hangar Replacement
Paving
$ 408,081
Federal Transit Administration
3 Bus Replacements
$ 384,939
Justice Assistance Grant
Police Initiatives
$ 360,320
Federal Highway Infrastructure
1 Bus Replacement
$ 349,000
State Revolving Loan Funds
North Fork Catfish Creek
Stormwater and Sanitary
$ 337,000
Community Development Block Grant
Formula Funds
Homeownership
Rehabs /Green Alleys
$ 328,269
Iowa Clean Air Attainment Program
(ICAAP) Grant
The Jule Medical Loop
$ 300,160
Public Transit Infrastructure Grant
ARC Transfer Center
$ 289,375
Iowa Department of Natural Resources
REAP Grant
Bottoms Property
Acquisition Mines of Spain
$ 200,000
Iowa Economic Development
Association/ U.S. Department of Housing
and Urban Development
Catfish Creek Watershed —
Phase II
$ 187,330
AmeriCorps Grant
Various Programs
$ 186,201
Iowa Department of Natural Resources
Land and Water Conservation Fund
Mines of Spain Interpretive
Center Addition
$ 175,000
Iowa Finance Authority
Housing Trust Fund
$ 137,637
24
Grant
Project
Award
Amount
Iowa Department of Transportation
Commercial Air Service
$ 107,598
National Endowment for the Arts Our
Town Grant
Millwork District Arts
Development
$ 100,000
Iowa Department of Transportation State
Recreational Trails Fund
Bee Branch Trails
$ 100,000
U.S. Housing and Urban Development
Shelter Plus Care
$ 93,528
State Energy Program
18`h & Central Energy
Improvements
$ 69,831
U.S. Fire Administration /Homeland
Security
Purchase of Fire
Extinguishers
$ 54,894
Iowa Department of Transportation
Air Service Sustainment
$ 53,000
State Revolving Loan Fund Green
Project
Green Alley Project
$ 41,400
Iowa Economic Development
Association/ U.S. Department of Housing
and Urban Development
Catfish Creek Watershed —
Phase I
$ 24,500
Iowa Department of Transportation
Youth Grant Program 2012
$ 23,478
Iowa Department of Transportation
Air Service
$ 19,708
Iowa Community Cultural Grant
Arts Coordinator Salary
$ 13,021
State of Iowa Lead Paint Remediation
Childhood Lead Paint
Poisoning Prevention
$ 11,835
Trees Forever
Neighborhood Tree
Planting
$ 5,750
National Trust for Historic Preservation
Design Guidelines
$ 5,000
American Association of Retired Persons
Cities of Service Grant
$ 5,000
Alliant Energy Foundation Community
Grant
Creekwood Park
$ 1,000
Total
$82,518,064
All this is helping the City keep the tax burden on citizens reasonable when compared
with the other nine cities in the State of Iowa with a population in excess of 50,000.
It should also be noted that the State of Iowa has underfunded the Homestead Property
Tax Credit nine years in a row, causing the average homeowner to pay more for their
City portion of property taxes (Fiscal Years 2004 - 2012). In Fiscal Year 2013, the State
only funded the Homestead Property Tax Credit at 78 %. This impacted the City portion
of property taxes for the average homeowner by an increase of $11.51 or 1.82 %. This
provided no additional revenues to the City, as this money would have come to the City
from the State if they appropriated the proper amount of funds. Governor Branstad's
Fiscal Year 2014 State budget recommends funding it at 100 %, and now it is up to the
State Legislature.
The recommended property tax rate for Fiscal Year 2014 for the City portion of
the property tax bill of $11.0259 per thousand dollars of assessed valuation (a
25
2.24% rate increase) is a 4.9% ($32.95) increase in property taxes for the average
homeowner if the State fully funds the Homestead Property Tax Credit. The
average commercial property taxpayer will see a 2.24% ($86.20) increase. The
average industrial property taxpayer will see a 2.24% ($144.53) increase.
A further historical comparison of Dubuque property taxes for the City portion of the tax
bill follows.
CITY OF DUBUQUE
HISTORICAL TAX RATE AND COST COMPARISONS BY CLASS OF PROPERTY
RESIDENTIAL, COMMERCIAL, AND INDUSTRIAL -1987 - 2014
Residential Commercial Industrial
Net Net
Property Net Property Property
FY Tax Rate % Tax % Tax % Tax %
2014 11.0259 2.24% 705.71 4.90% 3942.14 2.24% 6,610.00 2.24%
1987 14.5819 522.17
Avg Change Per Yr -0.94% 1.20%
If State Homestead Tax Credit was Fully Funded
RECAP
(1987 - 2014):
2,571.50 7,290.95
1.75% -0.23%
Residential Commercial Industrial
Net Net Net
Property Property Property
FY Tax Rate % Tax % Tax % Tax %
2014 11.0259 - 24.39% 705.71 35.15% 3,942.14 53.30% 6,610.00 -9.34%
1987 14.5819 522.17 2,571.50 7,290.95
The $11.0259 rate recommended in Fiscal Year 2014 for the City portion of the
property tax bill is a 24.39% decrease from the Fiscal Year 1987 rate of $14.58, for
an average decrease of 0.94% per year.
The property tax payment of the average residential property has increased
35.15% ($183.54) from the Fiscal Year 1987 property tax payment of $522.17, for
an average increase of 1.20% ($6.80) per year.
Since a local option sales tax of 1 %, with 50% dedicated to property tax relief, was
passed by referendum in February 1988, the reduction in the property tax rate has been
dramatic.
Since we do not yet know the Fiscal Year 2014 levies of the other cities, the following
compares Dubuque's proposed Fiscal Year 2014 rate with the actual Fiscal Year 2013
rates of the other nine large cities in the State of Iowa.
26
FISCAL BENCHMARKS
$20
$12
°0 510
Property Tax Rates
$12.60
$10.72 $11.02
$15.22 $15.85 $16.51 1
S16.78 517.27 $17.51 $17.85 $18 21
Ames Dubuque West Des Cedar Average Sioux City Davenport Iowa City Des Council Waterloo
Manes Rapids w/o Manes Bluffs
Dubuque
• lnclurles the transittax levy adopted bythe Des Moines Regional Transit Adhority for comparability.
Dubuque's recommended City property tax rate ($11.02) is the second lowest in
the State, as compared to the Fiscal Year 2013 rate for the other cities in the State
of Iowa with a population over 50,000. The highest- ranked city (Waterloo - $18.21)
is 65.25% higher than Dubuque's rate, and the average ($15.85) is 43.85% higher
than Dubuque.
How does the City of Dubuque compare with property tax revenue per capita?
Fiscal Benchmarks
Property Tax Revenue per Capita
Fiscal Year 2013 Comparison for
Iowa's 10 Largest Cities
Rank City Taxes per Capita
10 West Des Moines $837
9 Iowa City $750
8 Cedar Rapids $685
7 Council Bluffs $674
6 Davenport $665
5 Waterloo $610
4 Des Moines $554
3 Sioux City $463
2
Dubuque $415
1
Ames
Average w/o Dubuque
27
$407
$627
Dubuque has the second lowest property taxes per capita for the City portion of
the property tax bill in the State for the comparison cities. The highest - ranked
city (West Des Moines - $837) is 102% higher than Dubuque's rate, and the
average ($627) is 51% higher than Dubuque.
The taxable value of residential realty will be 52.817% of assessed value in Fiscal Year
2014, compared to 50.752% in Fiscal Year 2013. This percentage is also applied to
farm dwellings. No adjustments were ordered for commercial, industrial, railroad, and
utility property because there were not sufficient increases in values to qualify for
reductions. These properties are assessed on the basis of their market value.
Agricultural property will be limited to 59.933% of the assessed value in Fiscal Year
2014, compared to 57.541 % in Fiscal Year 2013. Agricultural property, excluding
agricultural dwellings, is assessed according to its productivity rate.
Overall, taxable property values in the City of Dubuque grew 2.61 % in Fiscal Year 2014.
WATER RATE
I am recommending a 9% increase in the water rates. Water Department Manager
Bob Green has contacted other cities in Iowa with a population over 50,000 that use a
water softening process, to determine the recommended water rates for these
communities for Fiscal Year 2014. In spite of the recommended water rate increase,
Dubuque would be the second lowest water rate in the State (as compared to the
lowest in Fiscal Year 2013) of these seven communities.
Water Rate Comparison
Monthly Water Rate Comparison for Largest Iowa
Cities with Water Softening for the Average User
Proposed
Rate (FY14)
City
West Des Moines
Iowa City
Ames
Cedar Rapids
Council Bluffs
$30.30
$27.40
$27.13
$24.44
$24.12
Dubuque $23.23
Des Moines
Average w/o Dubuque
$23.18
$26.11
For Fiscal Year 2014, the highest - ranked city (West Des Moines - $30.30) is
approximately 30.43% higher than Dubuque, and the average ($26.11) is
approximately 12.63% higher than Dubuque.
28
SANITARY SEWER
I am recommending a 17% increase in the Sanitary Sewer Rate. Water & Resource
Recovery Center Manager Jonathan Brown has contacted other cities in Iowa with a
population over 50,000 to determine the recommended sewer rates for these
communities for Fiscal Year 2014. Dubuque would be the sixth - lowest sewer rate in
Fiscal Year 2014 (the same as in Fiscal Year 2013).
City
Sanitary Sewer Comparison
Sanitary Sewer Rate Comparison
for Average User
Proposed
Rate (FY14)
West Des Moines $37.89
Des Moines $36.88
Iowa City $36.08
Sioux Cit $34.72
Dubuque $31.99
Davenport
Ames
Cedar Rapids
Waterloo
Council Bluffs
Average w/o Dubuque
$27.15
$26.35
$25.55
$22.40
$17.21
$29.36
For Fiscal Year 2014, the highest ranked city (West Des Moines - $37.89) is
approximately 18.44% higher than Dubuque, and the average ($29.36) is
approximately 8.22% lower than Dubuque.
The City Council has made a major decision on the future processes used in the
treatment of waste at the Water & Resource Recovery Center, which will impact rates.
The sewer fees in Fiscal Year 2014 are recommended to increase 17 %; 3% for
operating needs and 14% for capital needs. In Fiscal Year 2008, a facilities planning
study determined the best type of upgrade for the plant to be anaerobic digestion with
land application for solids management. The actual bid for the project was $50,583,067
with engineering services of $5,100,000 for a total project cost of $55,683,067. There
are micro turbines of $2,420,000 included in Fiscal Year 2013. The Fiscal Year 2013
budget included an additional SRF loan of $2.7 million to fund the micro turbines, which
will not have an impact on the sanitary sewer rate structures since the Iowa Finance
Authority reduced the interest rate for new 20 -year SRF loans from 3.25% to 2.00%
during Fiscal Year 2013.
Major portions of the Water & Resource Recovery Center are reaching the end of their
useful life and need to be reconstructed or replaced. Included in the list of
improvements necessary to maintain the operation of the facility are: 1) Influent
Screening; 2) Grit Removal; 3) Primary Treatment; 4) Biological Treatment; 5) Final
29
Clarification; 6) UV disinfection in place of chlorine gas; 7) Peak flow management using
used tankage; 8) Emergency backup power; 9) Administration /Laboratory; 10)
Refurbishing of all major valve and piping components; 11) Anaerobic Digestion in place
of Incineration for solids management; and 12) Methane capture and cleaning for
beneficial reuse.
Prior to Fiscal Year 2013, the General fund has been subsidizing a portion of the utility
funds' use of administrative services, such as Engineering administration, Engineering
Project Management, Finance accounting services, Economic Development, Planning
Services, Workforce Development, City Clerk services, Legal Services, City Manager's
Office including Budget, Geographic Information Systems, Sustainability, Neighborhood
Development, Arts and Cultural Affairs, and Personnel. Prior to Fiscal Year 2013, the
Engineering Department estimated the amount of time spent on projects and allocated
that time to an Internal Service Fund, which is then allocated to the various capital
improvement projects that the personnel work on. The remaining time not allocated to
the Internal Service Fund was considered administrative and has been charged to the
General Fund. In addition, administrative departments such as the City Manager's
Office, Legal, Planning, Economic Development, City Clerk's Office, and Workforce
Development recharged expenses based upon each enterprise fund's percent of the
City -wide operating budget, excluding debt service. The accounting activity of the
Finance Department has not been recharged to the other funds, with exception of
payroll and loan processing, parking tickets, and landfill billing.
Beginning in Fiscal Year 2013, additional overhead recharges to the utility funds began
being phased in over several years. Engineering administrative and project
management expenses that are not recharged to capital projects will be split evenly
between the Water, Sewer, Stormwater and General Funds. Finance accounting
expenses and all other administrative departments, such as Economic Development,
Planning, Workforce Development, City Clerk, Legal Services, and City Manager's
Office will be split evenly between Water, Sewer, Stormwater, Refuse Collection, and
General Funds, with overhead costs being shared by the Landfill and Parking. This will
be fully implemented over time.
The Sanitary Sewer Fund's fair share of the City's administrative overhead is 16.67 %.
In Fiscal Year 2014, the Sanitary Sewer Fund will only support 9.30 %.
Sanitary Sewer Rates
FY 2011
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
FY 2017
FY 2018
Plant Renovation
6%
10%
11%
12%
2%
0%
0%
0%
Operating & Other
Capital Needs
5%
5%
5%
5%
3%
4%
4%
4%
Total Sewer Fee
Increase
11%
15%
16%
17%
5%
4%
4%
5%
The Stormwater Utility was formed on July 1, 2003, to update the City's aging
infrastructure and implement the City of Dubuque $57 million Stormwater Management
Plan, which consists of three projects — two detention basins and a mile -long open
30
waterway known as the Bee Branch Project. It is the reconstruction and restoration of
over 4,500 feet of buried creek. It will reintroduce the confined Bee Branch Creek to the
North End Neighborhood. The implementation of the Bee Branch Creek Restoration
Project is the key to saving over 1,150 homes from flooding during severe rainstorms
that seem to come all too frequently.
Fiscal Year 2014 will be the sixth fiscal year that the Stormwater User Fee is
recommended to be fully funded by stormwater user fees. The General Fund will
continue to provide funding for the stormwater fee subsidies that provide a 50% subsidy
for the stormwater fee charged to property tax exempt properties, low -to- moderate
income residents, and a 75% subsidy for the stormwater fee charged to residential
farms. The schedule of the proposed rate increases in Fiscal Year 2014 is as follows:
In 2001, the Drainage Basin Master Plan identified three projects to provide flood
protection for 1,150 properties within the Bee Branch Watershed: the Carter Road
Detention Basin, the West 32nd Street Detention Basin, and the Bee Branch Creek
Restoration Project.
In May of 2003, the City of Dubuque City Council approved the selection of CDM, a
consulting engineering firm, to provide engineering and design services for the Bee
Branch Creek Alignment Study. The study objectives were to establish the optimum
alignment for the proposed open waterway along its approximately 4,500 -foot length;
provide a preliminary design to a level that it establishes what the waterway will look like
at different locations along its entire length and how the waterway will function before,
during, and after rainstorms of different magnitudes; and work with impacted residents
in the form of a citizen advisory committee, the Bee Branch Citizen Advisory Committee
(BBCAC), to ensure that the recommended alignment location and waterway design are
based on input from the neighborhoods impacted by the proposed open waterway. The
citizen committee's preferred alignment was presented to the City Council in a letter
from BBCAC Chairperson Charles Winterwood. The BBCAC's preferred alignment was
chosen because it best met the top three criteria established by the BBCAC: it
preserved commercial and non - commercial services; it minimized residential property
acquisitions; and it minimized the project cost. The preferred alignment impacted sixty -
five (65) residential homes and fifteen (15) non - residential buildings.
In December of 2004, the City Council adopted the alignment preferred by the BBCAC.
This is the current alignment proposed for the project.
31
FY 2011
FY 2012
FY 2013
FY 2014
Previously Projected
Rates
$5.25
$5.60
$5.60
$7.50
FY14 Recommended
Rates
$5.25
$5.60
$5.60
$5.60
% Decrease From
Previous Projections
0%
0%
0%
-33.9%
% Increase From
Previous Year
0%
6.7%
0%
0%
In 2001, the Drainage Basin Master Plan identified three projects to provide flood
protection for 1,150 properties within the Bee Branch Watershed: the Carter Road
Detention Basin, the West 32nd Street Detention Basin, and the Bee Branch Creek
Restoration Project.
In May of 2003, the City of Dubuque City Council approved the selection of CDM, a
consulting engineering firm, to provide engineering and design services for the Bee
Branch Creek Alignment Study. The study objectives were to establish the optimum
alignment for the proposed open waterway along its approximately 4,500 -foot length;
provide a preliminary design to a level that it establishes what the waterway will look like
at different locations along its entire length and how the waterway will function before,
during, and after rainstorms of different magnitudes; and work with impacted residents
in the form of a citizen advisory committee, the Bee Branch Citizen Advisory Committee
(BBCAC), to ensure that the recommended alignment location and waterway design are
based on input from the neighborhoods impacted by the proposed open waterway. The
citizen committee's preferred alignment was presented to the City Council in a letter
from BBCAC Chairperson Charles Winterwood. The BBCAC's preferred alignment was
chosen because it best met the top three criteria established by the BBCAC: it
preserved commercial and non - commercial services; it minimized residential property
acquisitions; and it minimized the project cost. The preferred alignment impacted sixty -
five (65) residential homes and fifteen (15) non - residential buildings.
In December of 2004, the City Council adopted the alignment preferred by the BBCAC.
This is the current alignment proposed for the project.
31
In August of 2008, the City Council authorized the hiring of Strand & Associates
(Madison, WI), in association with IIW Engineers (Dubuque, IA) and Ken Saiki Design
(Madison, WI), to prepare the final design of the Bee Branch Creek Restoration Project.
As outlined in the scope of services, the consultant team utilized the engineering study
previously performed and reported in the Bee Branch Creek Alignment Study to design
the improvements of the Bee Branch Creek Restoration Project. Input was to gather
and utilize input from citizens as they crafted the design of the final landscaping plan for
the project.
The City hosted a series of workshops to help gather citizen input. A press release was
issued before each workshop, and over 2,000 post cards were sent to targeted
neighborhoods. At the first workshop held in October of 2008, citizens were asked to
identify their hopes and fears for the project. In addition, they were asked to provide
input on the various potential landscape features, bridges, and secondary uses (paths,
park benches, playground equipment, etc.). At the second workshop in November of
2008, and again in January of 2009, the design team presented conceptual drawings
that began to address the citizens' hopes and fears, as well as their landscape
preferences. And finally, at the third workshop in February of 2009, the design concept,
based on citizen direction, was presented to the public for comment. The City's design
engineering consultant has utilized this input throughout the development of the design
of the various improvements associated with the project.
The Bee Branch Creek Restoration Project involves the day - lighting and restoration of
the buried creek and associated flood plain area from Kerper Boulevard just south of
16th Street to the north and west to Comiskey Park at E. 24th and Washington Streets. It
also includes ancillary elements such as improvements to the 16th Street Detention
Basin (ponding area); re- routing of sanitary sewer, water main, and storm sewer; bridge
construction (one railroad bridge and four vehicular) and street reconstruction to
accommodate traffic in the vicinity of the restored creek; landscaping with public
amenities such as a hike /bike trail with lighting, benches, trash receptacles,
informational kiosks, and public parking; and a maintenance facility with public
restrooms and public parking in support of the newly created creek and green, linear
parkway attraction.
In addition to creek construction and the ancillary improvements, the Bee Branch
Drainage Basin Master Plan project also includes improvements throughout the
watershed that will positively impact the health and viability of the restored creek.
These include construction of the Carter Road Detention Basin (completed in 2003),
reconstruction and expansion of the W. 32nd Street Detention Basin (completed in
2009), improvements to the 16th Street detention basin ponding area, improvements to
the 22nd Street storm sewer between Elm Street and Central Avenue, reconstruction of
the 235 alleys throughout the Bee Branch watershed as green alleys with permeable
pavement, and improvements to the Couler Valley (North End) storm sewer drainage
system between 24th Street and 32nd Street.
32
In order to implement the improvements in an ordered and meaningful way, a phased
approach is being utilized. A summary of the cost, schedule for various phases, and the
time -line for implementation is outlined in Table 1. A description of each phase is as
follows:
Phase I: Carter Road Detention Basin (Completed in 2003)
The Carter Road Detention Basin was the first Drainage Basin Master Plan project
outlined for the Bee Branch watershed. Located in the northwest portion of the Bee
Branch watershed, it is mainly comprised of an earthen dam approximately 350 feet
long and 40 feet high that can impound 59 million gallons of stormwater runoff. The
principal outlet of the dry bottom detention basin is a 15 -inch culvert and a 24 -inch
gated culvert. The high flow outlet is a 48 -inch diameter riser pipe that is approximately
37 feet high. A 350 -foot long asphalt access road provides access to the outlet
structure for operation and maintenance needs. The Carter Road Detention Basin has
been providing flood protection by reducing peak runoff flows since 2003.
Table 1. Summary of Cost and Schedule for the Various Projects (Phases) Associated with the Bee
Branch Watershed Improvement
Phase
Description
Estimated
Cost
Scheduled
Start
(Calendar
Year)
Scheduled for
Completion
(Calendar
Year)
I
Carter Road Detention Basin
$1,100,000
Completed in 2003
II
W. 32na Street Detention Basin
$4,300,000
Completed in 2009
III
Bee Branch Property Acquisitions
$15,577,000
2005
2013
V
Lower Bee Branch Creek Restoration
(16�n Street Detention Basin to R.R. tracks),
Includes Basin Overlook & Pack Memorial
Landscaping to be constructed in 2013
$14,946,000
2010
2013
V
Bee Branch Gate Replacement
$960,500
2013
2014
VI
Bee Branch Watershed Green Infrastructure
$9,420,000
2013
2015
VII
Bee Branch Creek Railroad Bridge /Culvert
(Connecting Lower Bee Branch to Upper Bee
Branch Projects)
$16,381,000
2014
2014
VIII
Upper Bee Branch Creek Restoration (Garfield to
22nd Street)
$16,832,500
2014
2015
X
Upper Bee Branch Creek Restoration
(22nd St. to Comiskey Park) and Lower Bee Branch
Creek Amenities: 15 Street Overlook and Floating
Island
$9,006,500
2014
2015
X
North End (Couler Valley) Storm Sewer
Improvements
$990,000
2017
2022
33
Following phases not in Fiscal Year 2014-2018 budget; they are contingent on available grant funding.
XI
22na Street Storm Sewer Improvements
$2,348,000
2019
2020
XII
Bee Branch Creek Multi -Use Maintenance, Public
Restroom, Public Parking Facility
$980,000
2019
2020
XIII
Bee Branch Watershed Green Alleys (up to 235
alleys)
$35,000,000
2019
2036
Note: Phases VII, VIII, & IX may be combined into the same phase and cons ructed at the same time
depending on the result of negotiations with the railroad and access to state and fede al grant
funding.
Phase II: W. 32nd Street Detention Basin (Completed in 2009)
To enable the expansion of the existing detention basin, the City acquired fifteen
properties and a portion of a sixteenth. As constructed, the West 32nd Street Detention
Basin provides the maximum amount of storage possible given the available land area.
The basin is sized to control a 100 -yr, 24 -hour rain; however, the design was optimized
to reduce discharge rates from smaller events as well. The facility provides for a 59%
peak flow reduction for the more frequent 5 -year rain. The peak flow reduction for the
100 -year rain is almost 70 %. The detention basin is able to store in excess of 33.5
million gallons of stormwater runoff. The basin was planted with a combination of wild
flowers, prairie grass, and wetland vegetation. The W. 32nd Street Detention Basin has
been providing flood protection by reducing peak runoff flows since 2009. It has also
been capturing sediment and preventing it from flowing into the Bee Branch storm
sewer, the Bee Branch Creek, and the Mississippi.
Phase III: Bee Branch Property Acquisitions (Began in 2005 and scheduled to be
completed in 2013)
In order to recreate the creek and flood plain through the City's developed North End,
property acquisitions were necessary. Since 2005, the City has systematically acquired
98 of the 100 requisite properties. The acquisition of both remaining properties is
expected in 2013. One property is required prior to the development of the multi -use
maintenance facility (Phase XII). The second involves property owned by the DM &E
Railroad, operated by Canadian Pacific (CP). Per the adopted alignment, the City must
acquire easement through the portion of CP property currently used for trackage and
acquire another portion of CP property in its entirety.
Phase IV: Lower Bee Branch Creek Restoration (Began in 2010 and scheduled to be
completed in 2013)
The Lower Bee Branch Creek Restoration Project includes the construction of the
2,100 -foot long creek and flood plain area from the 16th Street Detention Basin to the
railroad tracks just south of Garfield Avenue. In addition to the creek, the project
includes the construction of the Sycamore Street Bridge and the 16th Street Bridge. It
also includes the construction of 1,900 feet of the 36 -inch diameter sanitary sewer that
serves as an interceptor sewer, which will be extended north all the way to 24th Street,
with the construction of the next phases of the Bee Branch project. The project included
water main, sanitary sewer, and storm sewer relocation. The work includes the
dredging of the 16th Street Detention Basin (ponding area). It also includes the
34
installation of 2,840 feet of hike /bike trail along the creek with trail lighting and the
planting of hundreds of trees. The project includes the establishment of a Dubuque
Packing Company monument with landscaping at the corner of 16th and Sycamore
Street; the monument was erected in late 2011, with landscaping improvements to be
completed in early 2013. Finally, the project includes the construction of an overlook
adjacent to the 16th Street Detention Basin, which is scheduled to be completed by the
end of 2013.
Although the strictly flood control portion of the project has been functional since late
2011, the cost of the project cannot be determined until resolution of the dispute over
the project costs between the City and the contractor. The dispute is being settled per
the contract through the arbitration process, with a determination expected in April of
2013, following the adoption of the Fiscal Year 2014 CIP Budget. The contractor has
claims in excess of $3 million on a $10.8 million contract. In order to adequately
respond to the claims, the City has incurred unanticipated legal expenses.
Phase V: Bee Branch Gate Replacement (Begins in 2013 and completed in 2014)
Runoff from the Bee Branch watershed flows through the restored Bee Branch Creek
and discharges into the 16th Street Detention Basin, a ponding area that functions in
conjunction with the floodwall /levee system completed in the early 1970s to prevent the
Mississippi from flooding the City. When the Mississippi is above flood stage, flood
gates help provide the protection. This project involves the replacement of the flood
control gates, repair of the concrete gate structure and concrete wing walls, installation
of check valves on the pump discharges, and installation of new air release valves at
the floodwall's Bee Branch pumping station. While the gates have been inspected and
regularly maintained, the unusually low river levels in the fall of 2012 revealed wear and
tear to the level that replacement is necessary, and that it be added to the overall
project.
Phase VI: Bee Branch Watershed Green Infrastructure (Begins in 2013 and completed
in 2015)
Through the Bee Branch Watershed Green Infrastructure Project, at least 40 alleys
within the Bee Branch watershed will be reconstructed using permeable, interlocking
concrete pavement. Once constructed, approximately 268,000 square feet (6.2 acres)
of now impervious surface will be replaced with pervious pavement, reducing the
amount of stormwater flowing through the Bee Branch watershed by 5,610,000 gallons
and prevent approximately 2,400 pounds of sediment from dumping into the Mississippi
River each year.
The $9.42 million in funding to reconstruct the more than 40 alleys is coming from what
can be considered a grant through the Iowa State Revolving Fund program (SRF).
Instead of paying the already budgeted $9.42 million in interest on the City's SRF loan
for the upgrades to the City's wastewater treatment facility (Water & Resource Recovery
Center), the State has authorized the City to instead use the money to reconstruct the
alleys due to the positive environmental impacts that the alleys will have on the project.
35
This is a new State program established through legislation in 2009. The City of
Dubuque will be the first city to take advantage of the program and receive the funding.
Phase VII: Bee Branch Creek Railroad Bridge /Culvert (Begins in 2014 and completed in
2014)*
The reconstruction of a creek through the railroad property impacts the railroad in three
ways: it results in the City acquiring a portion of their property, including their current
yard office at 506 Garfield Avenue; it results in disruption to their operation during
construction of the City's project, as some of the tracks may need to be taken out of
service temporarily; and it results in the existence of a new structure under the railroad
tracks (bridge or culvert) that does not exist there today.
The City has been discussing the Bee Branch Project and the potential impacts to the
railroad with the owner of the tracks and rail yard since 2007. In 2007, it was owned by
Iowa, Chicago, & Eastern Railroad (IC &E). In 2008, the tracks and yard were acquired
by Dakota, Minnesota, & Eastern Railroad (DM &E). And finally, in 2010, the tracks and
yard were acquired by Canadian Pacific Railroad (CP). With support from the railroad,
the City originally planned to construct box culverts through the railroad property, a half
at a time, which would allow the railroad continued use of their tracks during
construction of the City's project. However, CP informed the City that in order to employ
this approach, the City would have to pay to upgrade yard tracks and install additional
switches. The reasoning was that the yard track is substandard and it would not be
allowable to use it as main line track when the current main line track is temporarily
taken out of service. Based on the direction of CP, the estimate to upgrade and replace
tracks and switches under this approach is $5 million. Even though the City anticipated
that track replacements would be required, the replacements and upgrades outlined by
CP would result in the City paying for $4.4 million more in track replacement costs than
planned or provided for in the budget. Originally, the City planned to build box culverts
to pass the stormwater through the railroad property. The design now reflects the
construction of a bridge. While it was known that a bridge would be more costly than
box culverts, it was thought that the increased cost would be offset with reduced track
replacement /upgrade costs because the bridge could be built, for the most part, with
existing railroad tracks in place. This has not turned out to be the case. The Fiscal
Year 2014 -2018 CIP Budget for the Bee Branch does not include these additional track
costs, as the City continues to look into ways to minimize the impacts to the railroad
and, thus, minimize the necessary costs to pass stormwater through the railroad
property. The Fiscal Year 2014 -2018 CIP Budget reflects other savings to be achieved
through value engineering.
*The start and completion date is still dependent on the negotiations with the railroad.
While the goal is to start and complete the project in 2014, depending on the railroad
track construction required for the project, it might be delayed until 2015.
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Phase VIII: Upper Bee Branch Creek, Garfield to 22nd Street (Begins in 2014 and
completed in 2015)
The Upper Bee Branch Creek Restoration Project from Garfield Avenue to E. 22nd
Street includes, but is not limited to, the following elements:
• Creek and Flood Plain
• Level Control Facility
• Rain Gardens with Boardwalks
• Rhomberg Avenue Bridge
• Lincoln Avenue Pedestrian Bridge
• Hike /Bike Trail with Lighting, Security Cameras, and 911
• Sanitary Sewer, Water Main, Storm Sewer Relocation
• Amphitheater
• Public Orchard
• 22nd Street Bridge
Phase IX: Upper Bee Branch Creek, 22nd St. to Comiskey Park, 15th Street Overlook,
and Floating Island (Begins in 2014 and completed in 2015)
The Upper Bee Branch Creek Restoration Project from E. 22nd Street to Comiskey Park
at E. 24th Street includes, but is not limited to, the following elements:
• Creek and Flood Plain
• Landscaping
• Hike /Bike Trail with Lighting
• Sanitary Sewer, Water Main, Storm Sewer Relocation
• Embankment Slides
• Creek Headwaters Overlook at 24th Street with Kiosk
• Reconstruction of 24th Street
• Connection to Comiskey
Creating the connection between the Bee Branch Creek linear parkway, the
Heritage Trail, and Comiskey Park at 24th Street, includes improvements to the
southeastern corner of the park, which include a green space with landscaping, a
walking path with lighting to the park, and a new pergola adjacent to the
Comiskey Park building. Comiskey Park is also to receive a $500,000 renovation
not as part of this project.
• 15th Street Overlook
The 15th Street overlook with plaza and rest areas is planned in the Lower Bee
Branch reach of the project. The overlook will include a pavilion, sidewalk,
lighting, drinking fountain, bike racks, trash receptacles, benches, trees, shrubs,
interpretive signs, and a blue light (911) emergency call box. It will be
constructed along 15th Street between Sycamore and Pine Streets.
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• Floating Island
A floating island is a form of a wetland which "bio- mimics" natural floating
wetland systems invented by nature. Vegetated with native plants, it is a
beautiful, natural, and sustainable eco- system which provides many benefits,
from habitat restoration to water cleansing. When launched, a whole diverse
eco- system is created which attracts life in all its forms, from microbes to
nymphs, to butterflies, to fish, birds ... all the way up the food chain. The floating
island will provide environmental benefits to the water by removing pollutants and
excessive nutrients through natural processes. The floating island is to be
located within the 16th Street Detention Basin.
Phase X: North End (Couler Valley) Storm Sewer Improvements (Begins in 2017 and
completed in 2022)
This project provides for the upgrading of the local storm sewers on 25th, 26th, 27th,
28th, 29th, and 30th Streets between White and Elm Streets in a six -year period. Storm
sewers will be upsized to handle stormwater runoff from heavy rains. While each street
will be considered individually, the storm sewer capacity will be expanded up to ten
times the current capacity.
Typically, storm sewers are designed to handle rain in small quantities. But with the
completion of the Bee Branch Creek Restoration Project, upgrading the local storm
sewers will significantly decrease localized street flooding that can also lead to
basement flooding. To limit the sewer upgrade costs, upgrading the various local street
drainage systems will be done, when possible, in concert with the Street Program and
the 10 miles of streets that the Public Works Department overlays each year.
NOTE: The following phases not in Fiscal Year 2014 -2018 budget; they are contingent
on available grant funding.
Phase XI: 22nd Street Storm Sewer Improvements (Begin in 2019 and completed in
2020)
As many have witnessed, storm water can form what resembles a river running down
22nd Street from Central to Elm Street. The construction of the Bee Branch Project will
alleviate this somewhat by ensuring that the storm sewer between Central and Elm
does not fill up and surcharge due to downstream storm sewer capacity. But
surcharging will still occur as the storm sewer between Central and Elm is not large
enough to handle even moderate rains. Upsizing the sewer between Central and Elm
did not make sense in the past because the Bee Branch storm sewer was already full of
storm water; it could not handle additional flow. But the restored Bee Branch Creek will
be able to handle the additional flow. One of the challenges associated with the design
of the Upper Bee Branch Project is trying to deliver the stormwater that flows down 22nd
Street into the Bee Branch Creek without damaging the newly created creek. While the
Bee Branch design will address this to a certain extent, the best way would be to extend
a larger storm sewer up 22nd Street toward Central. Due to the size of the storm sewer
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required, total street reconstruction and traffic signal replacement would be necessary,
and is included in the estimated project cost.
Phase XII: Bee Branch Creek Multi -Use Maintenance, Public Restroom, Public Parking
Facility (Begin in 2019 and completed in 2020)
The scope of the Bee Branch project requires a larger engineered maintenance facility,
along with trail parking, and public restrooms. The original plan for a maintenance
building was to reuse one of the garages acquired as part of the project. While the
garage will be used in the interim, it will not meet the maintenance needs once all
phases of the project are complete.
The proposed multi -use maintenance facility is to be constructed near what is now Pine
Street, between 15th and 16th Streets, in the vicinity of the Lower Bee Branch.
Phase XIII: Bee Branch Watershed Green Alleys (Begin in 2019 and completed in 2036)
Building on the benefits of the green alleys to be constructed in Phase VI, that uses the
SRF sponsorship (grant) funding, the plan is to reconstruct more alleys (up to a total of
235) within the Bee Branch watershed as green alleys, using permeable interlocking
pavers. The total number of viable green alleys and the anticipated costs are
conceptual at this point.
Phase XIII is the final phase. Following is a description of the issues involved in the
schedule.
In general, upstream detention basins should be constructed first. Therefore, the Carter
Road Detention Basin and the W. 32nd Street Detention Basin improvements were
completed in 2003 and 2009, respectively. In general, increased conveyance, such as
the creek and flood plain restoration, should be done from downstream to upstream; the
Lower Bee Branch Creek Restoration improvements were substantially complete in
2012. Ideally, the next leg of the creek construction project would be to extend the
creek constructed as part of the Lower Bee Branch to the north through the railroad
tracks operated by Canadian Pacific at 506 Garfield Avenue. Unfortunately, even
though the City has been discussing the issue with the various owners of the railroad
tracks since 2007, the City has not been able to acquire the railroad property required to
construct the next phase of the project, (see Phase VII above).
CP operates an active rail yard at 506 Garfield. Essentially, they have a series of tracks
and switches in order to store, sort, and load /unload railroad cars and locomotives. The
planned location where the City is to build a bridge or culvert through the railroad
property in order to pass stormwater runoff through the railroad property potentially
impacts the entire yard operation. Within the footprint of the City's project is several
track switches. If these switches are removed, even temporarily, it will prevent the
railroad from using a portion of their yard tracks. So in order to maintain an acceptable
level of operation during construction of the City's project, the railroad has outlined that
in the neighborhood of $5 million in track and switch replacement /upgrades are
necessary. Unfortunately, the lead time for switches is nine months and track work
39
cannot be performed during the winter months. Depending on the final resolution of
these issues, Phase VII of the project, the Bee Branch Creek Railroad Bridge /Culvert
Project, may not be able to move into construction until early 2015.
The schedule outlined with the proposed Fiscal Year 2014 -2018 CIP Budget is to have
a fully functional flood mitigation project in place by December 31, 2014. Finishing
touches such as landscaping work may stretch into the spring of 2015. All
improvements would be complete by July 1, 2015. But again, this will depend on Phase
VII as outlined above.
The proposed Fiscal Year 2014 -2018 CIP Budget for the Bee Branch Project includes
an additional $400,000 in Fiscal Year 2014 for the proposed trail head parking lot at
22nd and Prince Street. Prior to Fiscal Year 2013 ,the parking lot which is to be paved
with permeable pavement had been included in the overall project cost. However, in
Fiscal Year 2013 the cost of the improvements was shifted into the $9.4 million Bee
Branch Watershed Green Infrastructure Project (see Phase VI above). In the fall of
2012, after the Iowa Department of Natural Resources approved the City's proposed
project to construct 40 green alleys and two parking lots, the City was notified that
parking lots were not eligible for the program. Therefore, the parking lot is once again
listed as part of the Bee Branch Creek Restoration Project. The cost of the trail head
parking lot is to be financed with a combination of Federal Transportation Enhancement
funds and RECAT funds. Federal Transportation Enhancement funds and RECAT
funds are also identified to cover the cost of the Basin Overlook Project. And the Fiscal
Year 2014 CIP Budget includes an additional $300,000 for the Overlook Project.
The proposed Fiscal Year 2014 -2018 CIP Budget for the Bee Branch Project also
includes an additional $9.2 million in Fiscal Year 2015 for increased project costs that
include:
• $5,470,700 in construction costs and $533,200 in engineering costs associated
with the construction of a bridge or culvert to pass the creek under the railroad
tracks just south of Garfield Avenue;
• $50,000 in construction costs associated with the Pack Memorial landscaping
which will be offset through a Wahlert Foundation Grant and private donations.
• $764,300 in construction costs associated with the proposed Rhomberg Avenue
and 22nd Street bridges;
• $736,800 in construction costs associated with the reconstruction of a portion of
the Bee Branch storm sewer to remain under E. 24th Street and the associated
surface treatments;
• $380,000 in legal fees associated with the arbitration process related to the
construction contract for the Lower Bee Branch Creek Restoration Project
(Phase IV);
• $1,242,800 in anticipated increased project costs simply due to delaying the
construction of the improvements (inflation); and
• $70,000 in additional engineering and design costs associated with value
engineering and the soliciting and administration of grant funding.
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The estimated construction and engineering costs outlined for Fiscal Year 2015 are
offset somewhat by a $1.1 million reduction in anticipated property acquisition costs.
Due to the schedule and cost implications outlined above for Phase VII, the City has
continued to investigate the viability of other options to pass the stormwater runoff
through the railroad property from the Upper Bee Branch to the Lower Bee Branch. The
cost estimates for the options currently being considered range from $10,279,000 to
$19,406,000. The proposed Fiscal Year 2014 -2018 CIP Budget reflects the $10 million
option which will be the option of choice if determined to be entirely viable. The option
that the City ultimately pursues will be identified prior to the beginning of Fiscal Year
2014. But until then, the rate structure required to fund the project cannot be
determined.
With the adoption of the Fiscal Year 13 CIP Budget, funding was established and
supported by a stormwater utility fee rate structure to implement the first nine phases of
the Bee Branch watershed improvement projects. Since then, changes have occurred
regarding both project costs and possible funding sources. As promised, the City has
continued to seek outside funding in the form of grants and low interest loans to cover
the cost of the undertaking. As of Fiscal Year 2013, the City has successfully secured
$11,865,500 in local, state, and federal grant funding. And three additional grant
funding opportunities are being pursed and may be realized sometime in Fiscal Year
2014.
In the fall of 2012, the City submitted a grant request to the Economic Development
Agency (EDA) in the amount of $1.22 million. Feedback from the EDA to date has been
positive. The City expects to find out if the application was successful in early 2013 and
possibly prior to the adoption of the Fiscal Year 2014 budget.
The State Flood Mitigation Program was created in 2012. It established two possible
sources of funding for the Bee Branch watershed improvements: Flood Mitigation Fund
and a Sales Tax Increment Fund. The Flood Mitigation Fund will consist of
appropriations and other moneys and will likely be limited in scope. However, the Sales
Tax Increment Fund will receive deposits of increased sales tax revenues from
impacted areas, as calculated by the Department of Revenue. It established a 10 -year
state flood mitigation program capped at $30 million annually in state sales tax revenue
for a total of $300 million. It calls for a maximum award of up to $15 million a year for
any qualifying single community to match local and federal funds that communities
would spend on flood protection projects. A nine - member board is to be established in
the spring of 2013. The board must first establish an application process and
application procedures. Ultimately the board will scrutinize applications to allow
qualifying local entities to capture a share of the growth in their sales tax collections to
match state and federal financial assistance. The City is already taking steps to ready
itself in anticipation of an application process. HDR Engineering has been hired to
assist with updating the 2001 Drainage Basin Master Plan. The update will serve as the
basis of the City's flood mitigation application. If successful, the award is expected by
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December of 2013. Such an award may significantly impact stormwater utility rates that
are currently set per ordinance to increase from the current rate of $5.60 per month for
an average household to $9.00 per month in Fiscal Year 2017. But adopting an
ordinance to maintain the current rate at $5.60 per month starting into Fiscal Year 2014
and beyond is appropriate until the anticipated additional outside revenue is better
defined.
Another overall project cost that remains in flux is the final cost of Phase IV of the
project, the Lower Bee Branch Creek Restoration Project. In order to establish the final
project cost, the arbitration process is being utilized per the terms of the contract. The
arbitration process is expected to run its course with findings expected in April of 2013,
after the adoption of the Fiscal Year 2014 CIP Budget.
Even though the current rate of $5.60 will not support the borrowing for
construction previously outlined for the project, due to the volatility of project
costs associated with Phase VII of the project (the Bee Branch Creek Railroad
Bridge /Culvert Project) and the anticipation of additional state and federal grant
monies, the Stormwater Management Utility rate for Fiscal Year 2014 should
remain at the current rate of $5.60 with the understanding that it may be adjusted
at some point during Fiscal Year 2014 when the project costs and funding
sources crystallize.
It is anticipated that in Fiscal Year 2018 the Stormwater Fund will begin to be able to
support its fair share of the City's administrative overhead, or 16.67 %. In Fiscal Year
2014 the Stormwater Fund will only support 0.36% of the administrative overhead.
The solid waste collection fees in Fiscal Year 2014 are recommended to increase
9 %.
Solid Waste Collection Comparison
Solid Waste Collection Rate Comparison
for Average User
Proposed
Rate (FY14)
$22.50
$15.70
$14.90
$14.60
$14.10
$13.38
City
Ames
Iowa City
Sioux City
Cedar Rapids
Waterloo
Daven•ort
Dubuque
Council Bluffs
Des Moines
West Des Moines
Average w/o Dubuque
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$12.74
$12.50
$11.75
$11.10
$14.50
For Fiscal Year 2014, the highest- ranked city (Ames - $22.50) is approximately
83% higher than Dubuque, and the average ($14.50) is approximately 14% higher
than Dubuque. In Fiscal Year 2014, Dubuque will have the third - lowest refuse
collection rate, assuming other cities do not increase rates. In Fiscal Year 2013,
Dubuque had the second - lowest refuse collection rate.
The Solid Waste Fund's fair share of the City's administrative overhead is 16.67 %. In
Fiscal Year 2014, the Solid Waste Fund will only support 12.58 %.
In Fiscal Year 2014, the average homeowner will pay $124.24 more for City
services, including property taxes, sanitary sewer, water, refuse and stormwater,
than in 2013 — an average increase of just $34.78 per year since 1995.
Fiscal Benchmarks
Dubuque's Rankings among
Iowa's 10 Largest Cities
ISSUE RANK
Property Tax Rate (2nd Lowest) #2 of 10
Water Rate (2nd Lowest) #2 of 7
Sanitary Sewer Rate (6th Lowest) #6 of 10
Refuse Collection Rate (4th #4 of 10
Lowest)
Stormwater Rate (2nd Highest) #18 of 19
Property Tax Per Capita (Lowest) #1 of 10
As you can see, the City of Dubuque is very competitive among the ten cities in the
State of Iowa with a population that exceeds 50,000. I would like to show you how
much money this saves Dubuque taxpayers when compared to the average of the other
nine cities, and to the highest cost in each category (property tax, water, sanitary sewer,
stormwater and refuse collection).
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Fiscal Benchmarks
Savings to Average Homeowners
Current Annual If Equal to the Highest
Dubuque Cost Large Iowa City
Property Tax $ 706 $1,166 ( +$460)
Water Fee $ 278 $ 364 ( +$86)
Sanitary Sewer Fee $ 384 $ 455 ( +$71)
Stormwater Fee $ 67 $ 110 ( +$ 43)
Refuse Fee $ 153 $ 270 ( +$117)
Total Annual Cost $1,588 $2,365( +$777)
These savings put almost $15 million back into the local
economy annually; compared to if the City of Dubuque charged
the highest fee of the comparable cities.
The City continues to identify alternative revenue sources. The City currently leases
approximately 70 acres of industrial riverfront property to private industry. The City
receives about $1,798,308 per year in land -lease revenues for property that should be
generating much more. This compares favorably with the Fiscal Year 2012 lease
revenues of $548,672. In some cases, the City has more in expenses related to the
lease than is generated in revenue. The City is currently approaching additional firms
about their lease renewals.
The City faces some significant financial challenges over the next several years. I
commit to do my best to operate the City efficiently and to identify alternative revenue
sources to minimize the property tax bill. There were almost $19.5 million in
departmental requests that could not be recommended in the 5 -Year Capital
Improvement Program Budget.
Beginning in Fiscal Year 2013, additional overhead recharges to the utility funds is
being phased in over several years. Engineering administrative and project
management expenses that are not recharged to capital projects will be split evenly
between the Water, Sewer, Stormwater and General Funds. Finance accounting
expenses and all other administrative departments such as Economic Development,
Planning, Workforce Development, City Clerk, Legal Services, and City Manager's
Office will be split evenly between Water, Sewer, Stormwater, Refuse Collection, and
General Funds, with overhead costs being shared by the Landfill and Parking. This will
be fully implemented over time.
When the overhead recharges are fully implemented, the Enterprise Funds will split the
cost of administrative overhead excluding Engineering as follows:
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Water 16.67%
Sewer 16.67%
Stormwater 16.67%
Refuse 16.67%
Parking 8.33%
Landfill 8.33%
Engineering administration and Engineering project management will be split evenly
between General Fund (25 %), Water (25 %), Sewer (25 %) and Stormwater (25 %).
Purchase of services activities are those services that the City feels fit the goals and
priorities of the City and are not required to be provided or would not be provided in the
normal course of City business. In Fiscal Year 2014, the process was changed for the
funding of purchase of service agencies. The Fiscal Year 2014 budget recommends
allocation of $43,789 in General Fund and $12,500 in Community Development Block
Funds for a total of $56,289 to fulfill some of the recommendations of the Community
Development Advisory Commission.
The following purchase of service agencies have received funding in the past:
Agency
FY 2013
Funding Source
Helping Services of Northeast Iowa
$2,147
General Fund
Opening Doors
$7,720
General Fund
Opening Doors
$7,280
CDBG
Project Concern: Foster Grandparent Program
$6,113
General Fund
Project Concern: Child Care Referral
$6,624
CDBG
Project Concern: Information & Referral
$18,798
CDBG
Retired Senior Volunteer Program
$7,341
General Fund
Four Mounds HEART Program
$5,000
General Fund
Dubuque Art Center
$15,000
General Fund
Total
$76,023
Opening Doors, Four Mounds HEART Program, and Dubuque Art Center were
approved in Fiscal Year 2013 for three years of recurring funding. The $35,000 for
these organizations is included in the recommended budget in addition to the $56,289
allocation for other organizations.
Contracted services are services that the City would have within its organization
regardless of who provides the service. Contracted services in many cases leverage
other resources that would not normally be available to the City. An example is the
Dubuque Humane Society, which provides a heightened level of service for animal
control over what the City would provide for animals.
The following agencies have received or are being recommended to receive funding as
contracted services within other departments:
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Agency
Department
FY 2013
FY 2014
Funding Source
America's River Corporation
Economic Development
$10,000
$10,000
General Fund
Burlington Trailways
Transit
$9,600
$9,600
General Fund
Community Foundation of Greater
Dubuque - Project HOPE
Economic Development
$73,250
$70,308
General Fund
Community Foundation of Greater
Dubuque - Every ChildlEvery
Promise
Housing
$25,000
$25,000
General Fund
Crescent Community Health Center -
Operating
Health Services
$25,000
$25,000
General Fund
Crescent Community Health Center -
18th St Rent
Health Services
$25,000
$25,000
General Fund
Dubuque Area Labor Management
Council
Economic Development
$30,000
$30,000
General Fund
Dubuque Chamber of Commerce
Convention & Vistors Bureau
Economic Development
$886,717
$916,322
General Fund
Dubuque Main Street
Economic Development
$74,276
$74,276
General Fund
DuRide
Transit
$20,000
$20,000
General Fund
Greater Dubuque Development
Corporation - Retail
Expansion /Marketing/Workforce
Economic Development
$586,613
$586,613
Land Sales
Hills & Dales: Senior Center
Recreation
$18,200
$18,200
CDBG
Humane Society
Health Services
$126,507
$130,303
General Fund
Operation New View
Housing
$18,805
$19,369
General Fund
Operation New View: Head Start
Program - 18th St Rent
Housing
$25,000
$25,000
General Fund
St. Mark Community Center
Recreation
$15,000
$15,000
General Fund
Prosperity Eastern Iowa
Economic Development
$2,500
$2,500
General Fund
Washington Development
Neighborhood Corporation
Economic Development
$25,000
$75,000
General Fund
Washington Tool Library
Neighborhood
Development
$11,284
$11,284
CDBG
Total
$2,007,752
$2,088,775
Mayor Buol and the City Council met in August 2012 to establish the Missions, Visions,
Goals and Priorities for the community. These are the foundation of the City's work plan
and this budget recommendation:
Our Vision for the Community
Dubuque is a viable, livable, and equitable community. We embrace economic
prosperity, environmental integrity, and social /cultural vibrancy to create a sustainable
legacy for generations to come.
15 -YEAR VISION STATEMENT
• The City of Dubuque is a progressive, sustainable city with a strong diversified
economy and expanding global connections;
• The Dubuque community is an inclusive community celebrating culture and
heritage and has actively preserved our Masterpiece on the Mississippi;
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• Dubuque citizens experience healthy living and active retirement through quality,
livable neighborhoods and an abundance of fun things to do; and they are
engaged in the community, achieving goals through partnerships; and
• Dubuque City government is financially sound and is providing services with
citizens getting value for their tax dollars.
CITY MISSION STATEMENT
The City's mission is to deliver excellent municipal services that support urban living,
and contribute to a sustainable city. The City plans for the community's future, and
facilitates access to critical human services. The result is a financially sound city
government and citizens getting services and value for their tax dollar.
FIVE -YEAR COMMUNITY GOALS FOR A SUSTAINABLE DUBUQUE
• Economic Prosperity
• Environmental /Ecological Integrity
• Social /Cultural Vibrancy
FIVE -YEAR CITY GOALS
• Planned and Managed Growth
• Partnering for a Better Dubuque
• Improved Connectivity — Transportation and Telecommunications
POLICY AGENDA 2012 — 2014
Top Priorities:
• Arts and Culture Strategy
• Community Organization
• Dubuque Millwork District Master Plan
• Mystique Casino
• Southwest Arterial Project
High Priorities:
• Annual Street Improvement Program
• Greater Dubuque Development Corporation City Support
• Indoor Aquatic Center
• Master Plan for Chaplain Schmitt Island
• Safe Community Initiative
• Skate Park(s)
• Third Grade Reading Strategy
MANAGEMENT IN PROGRESS — 2012 -2014:
• Dubuque Initiatives
• Green Jobs Training Program
• Workforce Market Rate Housing Strategy
• NICC Job Training Grant
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• Renewable Energy Program
• Sustainability Purchasing Policy and Procedures
• EECBG Implementation
• AVL for Transit
• Grand River Center Electric Meters Project
• University of Iowa Initiative for Sustainable Community
• Green Team Work Plan
• Sustainability Curriculum in School System (Green Vision Program)
• City Operations Sustainability Performance Measures
• Dubuque Regional Smart Plan
• Department of Energy Smart Grid Grant
• FEMA Flood Plain Maps
• Sustainable Design Standards and Incentives
• DMASWA Landfill
• City Workforce Diversity
• Territorial Accountability Design (TAD Program)
• Local Foods Program
• Urban Gardens
• Citizen Academy
• Intercultural Competency Program within City Government
• Police Explorer Program
• Police — Race Dialogue
• Sustainable Dubuque Indicators Software Tool
• Housing Program
• Inflow and Infiltration Program /Home Inspections
• Surveillance and Security Cameras Strategy
• City Comprehensive Plan
• Census Count Resolution
• Flood Wall
• Statewide Urban Design ad Specifications City Engineering Standards
• Bee Branch Creek Restoration Project
• Parks — School Joint Projects and Services
• City Volunteer Program
• Sister City Program
• All America City Award
• Dog Park Concept Plan
• Veterans Memorials
• Handicap Accessible for Parks
• AmeriCorps Program
• Green Vision Education
• Bridges Out of Poverty Program
• Smart Transportation Program
• Transit for College Routes
• Trolley Upgrades
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• Traffic Signal Synchronization
• Quarterly Budget Monitoring Process
• Performance Measures
• Budget and Financial Report
• Website Content Management
• Citizen Response Management System
• 900 MHz Data System
• Employee Wellness Program
• Employee Involvement Teams
• Healthcare Cost Containment
• Police Officer Recruitment and Retention
• Bond Rating
MAJOR PROJECTS — 2012 -2014:
• Riverfront Marina /Transient Boat Dock
• South Siegert Farm Industrial Park
• Crescent Health Center 18th Street Building Renovations
• Water & Resource Recovery Center
Reductions in the total budget of 31% (from $214,460,033 in Fiscal Year 2013 to
$148,965,348 in Fiscal Year 2014) are the result of a reduction of 67.45% (from
$105,611,759 in Fiscal Year 2013 to $34,381,320 in Fiscal Year 2014) in the City
Capital Improvement Budget. This is mainly caused by the fact that funds needed for
the Southwest Arterial and the Water & Resource Recovery Center have been
accumulated from being budgeted in past years. Also, some needed funds for the
Southwest Arterial and the Bee Branch Creek Restoration Project are anticipated to be
received from federal and state grants and are not reflected in this 5 -year CIP. As these
grants are received, or other funding mechanisms are needed to be identified, these
project costs will be added to the budget over time. Also, the City has not received any
requests for utility extensions for large tracts of properties previously annexed. In the
future, as these requests are received, these costs will be added to the budget.
The City was contacted by Black Hills Energy in January 2013, in regard to the City's
gas franchise fee. Black Hills has inadvertently charged approximately 350 customers
located outside the City Limits the 3% City gas franchise fee. In addition, approximately
100 of their customers located in City limits were not being charged the gas franchise
fees. This information was determined after Black Hills Energy did an internal review.
Over the past five years, the impact from this discovery results in approximately
$91,000 collected from 350 non -City customers remitted to the City. Approximately
$12,000 was not collected or remitted to the City from 100 City customers. Black Hills
Energy will correct the February remittance of franchise fees to the City by reducing it
by $79,000. The City will cover the Fiscal Year 2013 $79,000 gas franchise fee shortfall
with Iowa District Court Fines, which met the budget of $200,000 in November 2012,
and has since exceeded the budget by $70,000.
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It is projected that there will be a negative impact to the City of approximately $31,200
annually from reduced gas franchise fees from Black Hills Energy in Fiscal Year 2014
and beyond. In late January 2013, the City was notified that the State funding for
Transit was increased $21,872 for State Transit Administration formula funding, and
$10,015 for Elderly and Disabled Persons funding, fora total of $31,887. This was not
known at the time the budget recommendation was put together. This additional
revenue will be used to offset the shortfall of the gas franchise fee in Fiscal Year 2014.
The Fiscal Year 2014 State Budget Certification will show $31,200 less in gas franchise
fee revenue and $31,887 more in State Transit revenue.
I am a fan of the former Stanford Business School professor and author Jim Collins and
his books, "Good to Great" and "Built to Last." He has a new book out, "Great by
Choice," in which he researches successful companies and goes on to explain:
"This research project began with the premise that we live in an environment of
chaos and uncertainty. But the environment doesn't determine why some
companies thrive in chaos and why others don't. People do. ... Of all the luck
we can get, people luck —the luck of finding the right mentor, partner, teammate,
leader, friend —is one of the most important."
"More than any of our prior research, this study shows that whether we prevail or
fail, endure or die, depends more upon what we do than on what the world does
to us."
I think these Jim Collins' observations fit in well with what I tell people when they ask
how Dubuque accomplishes the things it does here. I tell them it is about Planning,
Partnerships and People.
As you review this budget recommendation, you will note that it is supportive of the
Sustainable Dubuque initiative. Through this lens, we strive to meet the environmental,
economic, and social equity needs of today without reducing the ability of future
generations to meet their needs. Each activity supports at least one, and in most cases
several, of the Sustainable Dubuque principles.
I want to thank the citizens and businesses of Dubuque for deciding that they prefer the
price of progress over the higher price of stagnation and decline. None of the progress
this community is experiencing would be possible without the citizens' determination,
the business investment, the leadership of Mayor Roy Buol and the City Council, the
tremendously talented City employees, and the robust partnerships with local not -for-
profits and different levels of government. This is all our "people luck."
I want to thank Budget Director Jennifer Larson, Assistant City Manager Cindy
Steinhauser, Senior Budget Analyst Mary Brooks, Office Manager Juanita Hilkin,
Secretary Deb Searles, Secretary Stephanie Valentine, and Communications Assistant
Natalie Riniker, for all their hard work and dedication in preparation of this budget
recommendation.
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I look forward to City Council questions and input as you review this budget
recommendation and then this will be implemented according to your final decisions and
direction.
MCVM:jh
Michael C. Van Milligen
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