General Fund Finances
The general fund of the city includes two major components - department operations and major projects (see below). The finances of the general fund are split up this way because operations and projects each have different sources of revenue.
General Fund Project Revenue
There are many sources of revenue that the city can use to complete general fund projects.
When constructing or improving a street, the city can apply to the Iowa Department of Transportation for partial funding. At times, the city will assess the cost of a street improvement to property owners on that street. There are also grants programs that help pay for projects such as sidewalks or bike trail extensions.
For the portions of these projects which are not covered by outside money, the city is able to sell bonds, or borrow money, to pay for them. Payments on these bonds are made over time with local property tax and sales tax revenues.
Bonding can significantly increase the cost of a project because of associated issuance and interest costs. Because of this, the city closely manages its debt, attempts to reduce the frequency of bonding and works to reduce the number of years that the debt is paid off. Financial practices such as these help to ensure tax dollars are spent wisely.
General Fund Debt Payment
The city pays about $1,550,000 in general fund debt payments each year. Around $1,480,000 of this is used for principal payments, and the remainder is interest. Property taxes are the primary sources of revenue for these payments.
Some past projects currently being paid off include:
- Construction of the All Seasons Center, library, and outdoor aquatic center expansion
- Redevelopment of former hospital site