In the past five years, the City of Bettendorf's debt has nearly doubled, increasing from $57 million in fiscal 2006 to $105 million at of the end of June 2010.
An additional $17.3 million in general obligation bonds are due to be issued in the coming fiscal year beginning July 1.
In addition to new streets, street repairs and sewer system improvements, the city has issued bonds to help pay for the downtown special events center, various Tax Increment Financing projects, the purchase of property for future development near Interstate 80 and future park land north of Forest Grove Road. For details of this year's capital improvement budget, click here.
The just-passed fiscal 2011 budget (July 1, 2011 through June 30, 2012) anticipates the city will pay $9.65 million to service its debt in the coming year.
To pay the growing annual principal and interest costs, the debt service levy has been increased from $4.05 per $1,000 assessed valuation in fiscal 2007 to $5 per $1,000 assessed valuation for fiscal 2011.
City officials project keeping the debt levy rate at the $5 per $1,000 assessed valuation for the next five year, counting on an annual 3 percent growth in the city's taxable valuation to bring in the additional dollars needed to pay the higher debt and interest costs.
City officials at recent budget hearings pointed out the general fund levy ($5.49 per $1,000 assessed valuation) and overall property tax levy ($12.60 per $1,000 assessed valuation) are lower than most other Iowa cities with more than 20,000 population.
But If the city's general fund was raised to the maximum allowed by law ($8.10 per $1,000 assessed valuation), Bettendorf's proportion of property tax spent on debt service would still rank it near the top of urban communities in the state.
Ottumwa has the highest overall tax rate among the 22 largest cities in Iowa at $20.46 per $1,000 assessed valuation, but its debt levy is at $3.45 per $1,000 assessed valuation. Urbandale had the lowest overall property tax rate at $9.32 per $1,000 assessed valuation, with a debt service portion of $2.05 per $1,000 assessed valuation.
By comparision, West Des Moines (with an overall property tax rate of $12.05 per $1,000 assessed valuation) devotes only $2 per $1,000 assessed valuation (16.6 percent of its overall property tax rate) to servicing its debt.
Dubuque, with an overall tax rate of $10.02 per $1,000 assessed valuation, needs to allocate only one-half of 1 percent (.05) to pay its debt service.
