FY22 BUDGET PUBLIC INTAKE MEETING AGENDA
PLACE: Riverdale City Hall, 110 Manor Drive, Riverdale, Iowa
DATE: April 01, 2021 TIME: 7:00 P.M.
- PRESENTATION OF FY22 BUDGET
- REVIEW OF WORK TO-DATE ON LONG TERM FINANCIAL PLAN
- QUESTIONS FROM THE PUBLIC
OTHER MEETINGS/CITY EVENTS OF NOTE (all meetings will be held online)
Planning & Zoning Commission Meeting Tuesday, April 6, 2021 7:00 pm
Regular City Council Meeting Tuesday, April 13, 2021 7:00 pm
Public Hearing: Fenno Hill Urban Renewal Plan and
Belmont Project Dev. Agreement Tuesday, April 20, 2021 7:00 pm
Regular City Council Meeting Tuesday, April 27, 2021 7:00 pm
Regular City Council Meeting Tuesday, May 11, 2021 7:00 pm
Regular City Council Meeting Tuesday, May 25, 2021 7:00 pm
City Hall Closed Memorial Day Tuesday, May 31, 2021 All Day
(UPDATED 04-02-2021) A recording of the meeting can be found below.
A Public Hearing and Council Meeting will be held virtually and in-person on Tuesday, March 23, 2021 at 7:00pm. Masks are require inside City Hall and seating is limited.
The budget intake meeting was held as scheduled. A recording of the meeting can be found below. The 2020-21 Goals and Objectives memo produced as a result of the January 5, 2020 goal setting session with the Riverdale City Council (referred to in the video) can be found here.
This meeting is informational and participatory. It will be recorded and shared via social media and posted to the City’s website, as well.
Chair: Mayor, Mike Bawden
- Review of Budgeting Process
- Review of Goals and Objectives set by the City Council in January 2020
- Discussion of Desired Goals and Objectives by those present
- Identification of Specific Projects and Long-Range Plans to be considered
- Additional Community Input
For the past three months, Riverdale has been working on re-aligning its sanitary sewer rates for the coming fiscal year (which starts in July). The City Council is now considering an ordinance change that will allow residents and businesses to have a say in how those rates are set.
The ordinance, which will have its first reading at the May 26, 2020 City Council meeting, establishes a review committee which is made up of residents, business owners and representatives from Arconic, PVCSD and Scott Community College. Their job will be to review sewer infrastructure costs and upkeep issues and to provide recommendations to the City Council on rates and budget expenditures.
It is estimated the committee will only have to meet two or three times a year. If you are interested in serving on the committee, please email the mayor.
Re-Structuring the City’s Sewer Fund
The Mayor has been working with the City’s accounting firm, BFA, to build a more comprehensive financial model to project Riverdale’s sanitary sewer expenses now that it has become part of the consortium of cities that jointly owns the trunk sewer line extending from Panorama Park to west Davenport (where the waste treatment facility is located).
“Our responsibilities as a co-owner of the waste treatment plant and the main trunk line that serves us means we all need to make sure our sewer fund has enough money in it to manage the on-going operational costs and improvements needed from time to time in that facility,” explained Mayor Bawden.
But the overhaul of the City’s Sewer Fund was needed for more reasons than just the costs associated with the joint sewer service with Davenport, Bettendorf, and Panorama Park. “We also needed to start allocating overhead and engineering costs for the sanitary sewer to the sewer fund,” explained the mayor. “Historically, Riverdale has been covering those costs out of its General Fund and that’s not really appropriate. Those costs are sanitary sewer related, so they should be paid with user fees and not property taxes.”
The difference is slight, but it is there. Not all residents in Riverdale are on the sanitary sewer system and, as a result, don’t pay sewer fees.
In addition to the costs of the jointly-owned sewer utility and overhead, the financial model built by BFA also includes capital investments and sanitary sewer rehabilitations currently scheduled for the next 3 to 6 years as Riverdale moves proactively to eliminate I&I (inflow and infiltration) from their portion of the joint sewer system. Failing to do successfully eliminate I&I from the lines could be financially catastrophic not just for Riverdale, but for all of the cities in the partnership.
“The Iowa Department of Natural Resources has a multi-million dollar order ready to hand down to Davenport, Bettendorf, Riverdale and Panorama Park if we don’t ge the I&I situation under control and reduce the amount of relatively clean water that flows through the waste treatment plant at peak times,” said Mayor Bawden. “Most of the work needs to be done in Davenport and some of it needs to be done in Bettendorf – but Riverdale and Panorama Park have a little work as well. In our case, most of the sewer repairs we need to make can be done by re-lining the pipes. There are just a couple of spots where we’ll need to do something more involved.”
Rate Increases Are Inevitable, But Won’t Be As High As Originally Expected
With most of the financial modeling completed – thanks in large part to projections provided by the City of Davenport for anticipated waste treatment costs over the next 5 years or so – it’s possible to get a more accurate read on what is expected to happen with sewer rates when they are finally adjusted for FY 2021.
According to the mayor, all sewer rates are going to go up in July, but not quite as much as originally expected.
Even after we increase the rates in Riverdale, we should still be below where Bettendorf and Davenport are, cost-wise, with our rates in all categories (Industrial, Commercial, Residential, etc.). But more importantly, we should be able to control the rate growth and keep it at or below the CPI (Consumer Price Index) and still generate enough cash flow to self-finance the larger, capital projects.
New sanitary sewer fees should be ready for City Council review at its first meeting in July (07/14) and, if approved, will be used in the sewer billing that is mailed to residents near the end of the month.
Iowa Governor Reynolds ordered the end of the school year late last week, so now the City of Riverdale is working with contractors to possibly accelerate the road project currently underway in the Havens Acres neighborhood.
The original plan called for work “in the street” to begin after the end of school on June 8. The Governor’s orders change that, allowing Brandt Construction to move into the streetwork as soon as they’re finished doing their work “behind the curb.”
According to project manager, Troy Stimpson, the contractor will keep the City and its residents informed of their project timeline so accommodations can be made:
“We will proceed with milling and asphalt paving after the other work is done behind the curb. We’ll keep you posted on our schedule. As always, we will also monitor the virus and any potential impacts it will have on our project schedule.”
The total project comes to around $221,000 and was originally slated to be completed in late-July/early-August.
At its April 14th meeting, the Riverdale City Council certified the proposed FY21 budget, clearing the way for a number of projects over the next twelve months.
FY21 Budget At A Glance
The budget for the coming fiscal year (which starts in July), calls for general fund and debt obligation taxes of $627,448 which is up slightly from last year. The tax rate for the General Levy will be $4.41807/thousand of assessed valuation. The Debt Service Levy will be $4.37065/thousand and the Capital Improvement Reserve Levy will be $6.1725/thousand.
The biggest difference in the FY21 budget from previous years is the revenue and expense associated with sanitary sewer service. The budget currently projects a significant increase in sewer fees (which haven’t been adjusted since the sewer fund was set up). The actual rates will be set and reviewed with a commission of citizens, businesses, the school district and SCC. The final decision on the rates for services will still lie with the City Council, but the input of the Commission will be very important in setting those rates.
In addition to the increased sewer fees, the City will see increased expenses associated with operating and maintaining the joint sewer line that runs from Panorama Park to West Davenport as well as the costs for inspecting and repairing the sanitary sewer lines in Riverdale.
The Budget as a Policy Document
As mentioned in the memo that accompanied the budget submission, the FY21 budget differs from other budgets for the City in Riverdale in that it incorporates specific goals, objectives and policies set by the City Council at it’s goal-setting session in January. This means that starting July 1, several new projects will be on the agenda for the City to finish in the coming months including:
• Replacement of the current vehicle ventilation systems for the fire department and repairs made to the entrance apron to the station house.
• A review of insurance costs for the city and fire department as we attempt to find alternate ways to reduce risk to our fire fighters and EMS technicians.
• The replacement of several storm water intakes throughout the City to improve how we handle rainfall and prevent erosion in our neighborhoods.
• Investigation and development of a solution to the drainage problems suffered by homes along the 200 block of Manor Drive.
• Further progress on the MRT/Havens Acres plan to reduce unwanted bike and pedestrian traffic through the neighborhood.
• Addressing nuisance property issues on Fenno Hill.
• Development of a facade improvement program for Riverdale-based businesses.
• Development of a RISE grant application for the replacement of Bellingham Road.
• Community-landmark signage for Riverdale at up to three locations.
• An evaluation as to whether or not the Capital Improvements Reserve Levy and the use of General Obligation Bonds should be dropped in favor of other, more flexible financing tools available to the City.
• The creation of a document archival system and re-cataloging of all City documents.
FY20 Isn’t Over Yet
The City still needs to complete its re-estimation of the FY20 budget and identify fund transfers that need to be made within the budget so projects can be paid on time. At the same time, the City is starting a long-range budgeting project to work out a 4-5 year financial plan that it can maintain going forward as well as working with its accounting firm to review and revise its Sewer Fund accounting practices (and rate-setting) as well as how it tracks costs and income in its four, TIF funds.
Earlier this year, the City Council met for a goal-setting session and identified the need to improve the responsiveness of the City to the needs of its residents as a top priority. One significant change that would need to be made would be to increase the number of hours a week City Hall was open to the public and, at the same time, increase the number of hours City Staff were available to work on a variety of issues and projects.
About a month later, Interim City Administrator, Lisa Kotter, announced she was taking a full-time position with the City of Eldridge – bringing these staffing changes to the forefront and influencing the City Council to step up the process of searching and selecting a new, full-time administrator (either a City Administrator, City Clerk or combination of the two) as well as a second person to serve as a full-time deputy.
At Tuesday’s City Council Meeting (04/14), the Council will decide whether or not to increase the budget for hiring consultant Pat Callahan to assist in the search and selection process. The goal is to have both new positions filled by the start of the next fiscal year in July.
What’s Happening at City Hall Now?
Even though Ms. Kotter continues to provide some assistance with Riverdale city issues – with the knowledge and agreement of Eldridge City Officials – Mayor Mike Bawden has stepped in temporarily to keep a number of different projects moving forward at City Hall in the interim. His latest Administrative Report identifies thirty-one different projects currently in-work at the City and it’s likely that number will continue to grow.
In addition to these various projects, the mayor, deputy clerk and maintenance person are all working at better defining the work currently being done by each, documenting processes and brainstorming ways to work “smarter” and not just “harder.”
“We’ve already started identifying ways to make it easier to create, file and find documents related to all of the various projects we take on every year as a city,” explained the mayor. “Document management has been an issue here for years and between the recent IT upgrade and the additional capabilities our external vendors bring to the table, we should see a significant improvement in the City’s response time for records on everything from Council Meeting Minutes to sewer lateral connections.”
But improvements go way beyond how paper is being handled by the City. A new work order process for maintenance projects, a system of double-checking any purchase made over $250 and improved reports to the City Council for both maintenance and fire department activity are all just the tip of the ice berg.
“We’re working on reviewing and re-inventing almost every process that’s existed at City Hall for the last 60 years,” explained the mayor. “As a result, we’re finding small savings here and there that, over the course of the year, are likely to add up to some significant savings.”
“I look forward to sharing more of that information with residents at our next Town Hall meeting on April 26th.”
At the last City Council meeting (on March 24th), members of the Council expressed concern that more people didn’t participate in the public hearing on the FY 21 budget. As a result, we decided to make sure every resident was informed about the availability of the budget document and provided multiple ways for them to make inquiries.
Three people expressed interest in doing so.
There were a number of questions raised by former City Council Members, Cheryl Channon and Jim Beran. Wendy Syverud has also asked for a copy of some budget preparation documents and I’ve tried to get them to her – although that hasn’t been as simple as it should be. I still look forward to hearing from Wendy with any questions or insights she might have.
The main focus of questions from Cheryl and Jim were about the sewer fees and sewer payments in the budget. These are big items:
• Sewer Fees and their projected increase are located on line 10 (Charges for Fees & Service). In FY19, we collected about $70,000 andour re-estimated FY20 collections are shown as $123,000. The FY20 number is close, but the FY19 figure seems to be missing about half of the revenue.
• Sanitary Sewer Costs and the improvements we’re making to the sanitary sewer in 2020 are shown on line 25. The figure for FY21 includes our estimated cost of operating the joint sewer line, the cost of service, the cost of financing improvements to our own sewer and setting aside some money to re-build our depleted Sewer Fund. The re-estimated cost of $0 in FY20 is wrong and the Actual FY19 costs of $123,122 looks to be about right (which is why I assume about half of the revenue is in the wrong line in the FY19 report).
All that being said, here’s a summary of the questions from Cheryl and Jim:
Q. What are the actual estimated costs for the sewer since we show such a dramatic increase in fees and costs in FY21. How do we expect citizens to pay for this?
A. The best I could do for the FY21 budget is estimate those costs based on notes I’ve taken at our joint sewerage committee meetings, notes from prior Council Meetings, a review of the current state of the Sewer Fund for the City and email correspondence with the State Auditor as to the best way to track and manage all of this.
The City uses about 150 million gallons of water in its sanitary sewer each year. The rate for that is around $1.86/thousand gallons – although we charge less than that currently. The difference is made up out of our Sewer Fund (more on that later). Under the new 28E agreement we signed, we will have some additional expenses associated with managing our sanitary sewer that relate to the operations of the sewage treatment plant in Davenport.
Remember, the alternative to paying our fair share for operating the sewage treatment plant is to build our own – and we have neither the space or the funds to do that.
In addition to the operating costs of the plant and our share of the plant upgrades, we have to work on our own sanitary sewer lines and in 2019, we arranged for the General Fund to loan the Sewer Fund $150,000 for the first phase of this work (which will get underway shortly). That money was loaned to the fund at a 2.15% interest rate (same rate we get at the bank), but it’s not clear to me when that money switched funds (if ever). To add to the complexity of “how much does it cost” we need to consider slowly re-building our Sewer Fund since we shouldn’t have to loan it money to operate.
When it’s all said and done, the cost for sanitary sewer service in Riverdale should be between $500 – $600k/year through FY27. For the FY21 budget, all I did was take the FY20 estimated revenue and multiply it by 5 and then round up a bit. This would increase everyone’s sewer bill from $15 a quarter to $75 a quarter ($25 a month) which, compared to Bettendorf (around $37/month) and Davenport (around $42/month) is still pretty competitive.
Here’s the silver lining, though. We’ll be getting a proposal from BFA to go through all of the records on this and build a clear, accurate financial model of what the costs are and where the rates really SHOULD be. My hope is that work will be done by the time we’ve been able to pull together a Utilities Commission made of residents and local businesses to review those costs and rates and help us set them at a level that’s considered reasonable by all.
For the budget, I estimated high so the Commission would have the latitude to come in with a lower recommendation if they felt it was justified. Budgeting low and then having to go through a number of additional hoops to revise the budget to accommodate higher rates seemed like a bad idea to me.
Q. Why aren’t improvements to the sanitary sewer line and operational/capital costs for the joint sewer line paid for out of the General Fund like any other public works project?
A. I spoke to the State Auditor about this. While sanitary sewers are “pipes in the ground” and one would think that makes them a public works project, the sanitary sewer isn’t a service that everyone in the City enjoys and, more importantly, the service itself is paid for by a user fee, not property taxes.
The Auditor agreed that the money used for sanitary sewer services (both the revenue and the expenses – whether their for our own local lines or our share of the jointly owned line – should be reported as an Enterprise Fund/Business Type Activity (Sewer Utility Fund). Here’s what Suzanne Dahlstrom wrote to me this past week:
Even though the City of Riverdale doesn’t operate the Sewer System themselves, they are still responsible for their portion of costs associated with ongoing operations, maintenance and upgrades to the sanitary sewer system through the 28E agreement. Therefore I agree it should be reported as an Enterprise Fund/Business Type Activity (Sewer Utility Fund). Chapter 384.84 provides for the collection of rates at least sufficient to pay the expenses of operation and maintenance of the city utility and requires rates to be established by ordinance of the council .
I’m not aware of anything that prohibits the City from paying for sewer improvements from the General Fund however, I wouldn’t recommend it in your case. As you indicated, the Council would essentially be budgeting sewer improvements through the General Fund tax levy, which not all your resident will be benefiting from. And since you’ve already established for the collection of non-tax sewer rates for the 2BE payments, it makes sense to budget for these improvements through the Sewer Utility/Enterprise Fund/Business Type Activity function.
You are handling this issue very appropriately.
Q. The line in the budget for Debt Service (Line 22) shows an amount of $316,813. Does that include the management fee?
A. I took that information from the debt schedule Ron Fullerlove had prepared years ago and the other numbers matched previous budgets and AFRs, so I believe it does.
Q. Why does the re-estimated FY20 budget show $0 for Business Type/Enterprises (Line 25)?
A. I have no idea why the budget was re-estimated that way. That’s where our sewer fees, etc. should be. Apparently, the budget was originally put together showing no costs on that line from the beginning – which is odd since this question came from the person responsible for putting that budget together with the Clerk.
The bigger point Cheryl is making with most of her questions, though, is valid. She raised a concern that we are over-spending on our budget and not amending the budget properly to avoid citizen complaints.
She has also pointed out that our capital projects budget in the current FY21 budget isn’t high enough to cover the road improvement project in Havens Acres and the sewer re lining project (Phase 1 of the Sewer Rehab project). The reason for that is that while part of the Road Rehabilitation project will occur in FY20, the Sewer Re-Lining Project is expected to occur in FY21 and be paid for out of the Sewer Fund and not the General Fund.
Q. What’s the plan for FY20 budget amendments?
A. Cheryl is right in saying we need to address possible budget overruns for FY20 sooner rather than later. In fact, my plan has been to take a look at the current budget once FY21 gets approved and prepare a series of budget amendments for either our next Council meeting (04/28) or the following one (05/12) to make sure time is allowed for a public hearing (if needed) and to get the amendments in to the State of Iowa by the May 31 deadline.
Q. Does the new budget include revised mowing and landscaping costs?
You can download a copy of the proposed FY 2021 budget for the City of Riverdale here, complete with a detailed memo from the Mayor how budgets were set and what the City expects to accomplish in the coming fiscal year. If you would like a hard copy of the memo, you can stop by City Hall to pick one up or call the office during regular business hours (Tue-Thu from 10a – 5pm) and ask to have a copy mailed to you.
The offer to mail copies of the budget memorandum pertain only to residents of Riverdale.
Please send all questions by using the form below, via email to firstname.lastname@example.org, by regular mail (to City Hall; 110 Manor Drive; Riverdale, IA 52722) or by phone (563-355-2111).
Answers will be posted online and reviewed at the next City Council meeting prior to consideration of the budget for adoption and certification with the State of Iowa.
Mayor Mike Bawden announced that the final public intake session on the FY21 budget will be held Thursday afternoon (March 19) at City Hall. The meeting will start at 4:30 and is scheduled to end by 6pm.
The public intake session will include going through the budget memo prepared by the Mayor and shared with members of the City Council last week. Citizens will be invited to ask questions and suggest additions and/or modifications to the proposed budget during the meeting.
A final, edited version of the budget dialogue and budget document will be reviewed with residents at the Mayor’s Town Hall meeting on Sunday March 22 (at 2pm) and then again at the Budget Public Hearing scheduled for 7pm on Tuesday, March 24. The public hearing will be part of the City Council’s regular meeting.
Following the public hearing, the Council will consider adopting the FY 21 budget – taking the comments from the public hearing into consideration. At last year’s meeting of the City Council, the Council agreed to further reduce the tax levy for the coming year based on feedback from citizens at the preceding public hearing.
The current budget calls for a $.33/thousand increase in the general levy and the use of approximately $160,000 in additional funds from the City’s General Fund Reserve for the coming year.
The draft copy of the Budget Memo (including the budget) can be found here.
The Riverdale City Council voted unanimously to set a maximum, general tax levy for the coming fiscal year at $400,000. This number is based on the recommendations made by Mayor Mike Bawden during his budget presentation at the “Max Levy Hearing” conducted during the meeting on February 25th.
Although the City Council had approved a much larger levy earlier in the year – in order to allow the City staff to move ahead with posting a public notice for the 02/25 hearing, the intention was to have a much more closer estimate of the actual tax levy required for FY21 by the time of the public meeting. That original levy ($681,590) was approximately 70% higher than the max levy actually authorized by the Council.
FY21 Levy May Be Even Lower
During the budget presentation, the Mayor explained the actual levy required to make the numbers work for the coming fiscal year may be closer to $330 – $335,000, but upon the recommendation of Interim City Administrator, Lisa Kotter, the Council agreed to set the levy a little higher to provide some flexibility as the budget continues to be finalized.
As shown in the chart (below), the tax levy for the current fiscal year was $317,159 and the current budget shows an increase of only $14,000 (approximately $.23 per thousand dollars of assessed valuation after the state rollback). If these numbers hold up, the average home in Riverdale would see only a $23 per year increase in their city property taxes.
A complete copy of the presentation made at the Max Levy Hearing can be found here.
The Mayor explained that he would be working with the City’s accounting firm on March 10 to create a near-final draft of the budget that will then be made available for an in-depth review by the public at a meeting to be held later that week. That budget, plus notes from the public meeting, will be posted to the City’s website for review.
The final, draft version of the budget will be presented for review and discussion at the town hall meeting on Sunday, March 22 (at 2pm) and then again at the public budget hearing on Tuesday, March 24th (at 7pm).
The City Council will consider approving the final version of the budget as presented or in an amended form at their regular meeting following the public hearing. If needed, the City Council can delay their consideration for a week to allow the Mayor to revise and re-present a final draft of the budget for consideration at a meeting on Monday, March 30.
An approved budget for FY21 is due to the Scott County Auditor for certification on March 31.