Bettendorf city officials say they see no reason to curtail an "aggressive" capital spending plan or reduce long-term debt because overall city property values continue to grow significantly from higher assessments and strong commercial and residential construction.
City Administrator Decker Ploehn told alderman at a recent budget session that "picking an arbitrary debt levy rate or debt margin to living within may not allow the growth needed to maintain or upgrade our existing infrastructure."
Consequently, the city staff is recommending a $15 million community improvement plan (CIP) for the coming fiscal year that begins July 1. The proposed CIP currently under review by the city council would require the issuance of another $11 million in general obligation bonds.
The bonds would add to the city's long-term debt, which totaled $106 million as of June 30, 2011. The current city debt equates to $3,173 for each of the city's 33,217 residents.
The city's debt levy is the highest among the largest 22 cities in Iowa, and was one of the primary issues discussed during last year's mayoral election between Mayor Bob Gallagher, Jr. and Patricia Malinee.
City officials in their presentation to aldermen noted that even with the high debt levy, the overall city tax levy is the seventh lowest in the state. CLICK HERE to download the staff Powerpoint presentation on the budget recommendation.
With higher property assessments and growth in the residential and commercial tax base, city staff recommended to the council a decrease in the overall tax levy from $12.60 per $1,000 assessed value to $12.50 per $1,000 assessed valuation.
But even with the tax rate decrease, the higher property assessments would mean residential taxpayers would pay an average of 5.62 percent more in property taxes next year.
That tax hike would be coupled with recommended increases in sewer fees (12 percent), stormwater fees (17.5 percent) and garbage/recycling fees (3 percent).
Commercial property taxpayers, on the other hand, would pay an average of 4.5 percent less in property taxes.
The net result of the staff-recommended budget and tax rates/assessments would be an additional $1.22 million for city operations.
Of those funds, nearly half -- $530,000 -- would go to cover the increased city debt (principal and interest payments) while $571,000 is needed to pay for employee wage increases and benefit/pension costs.
The proposed fiscal 2012-13 budget will the subject of a public information meeting Wednesday, February 22, at 6:30 p.m. in the City Hall Council Chambers.
