City Council - Regular Meeting

We're going to get started on the work session uh for the April 20th, 2026 De Mo City Council work session. I think we're going to change up the schedule a little bit. We'll have the auditors go first because I'm sure they're going to deliver us some great news. Uh and uh if you would like to go ahead and take the podium, that'd be great. Thank you. And then we'll do the blank park zoo.

All right. So, I'll do a quick introduction. Um, as mayor mentioned, this is uh our annual financial statement audit for fiscal 2025. I'm going to introduce the auditor here. He's going to go through some numbers, the findings, and all of that stuff. Um, two points to make is that number one, this is statutoily required by the state law to walk you guys through the audit every year. So, this is a recurring event that we do. And number two, there's actually a change this year. Um, for the first time in over 20 years, we have a new audit firm um that did our audit. So, they're coming at it with some fresh eyes. So, there's bound to be some findings. So, we're going to walk through some of that stuff. Uh, without further introduction, this is uh Brian from ID Bailey.

Oh, is this is this not is it going to be Well, good morning. Uh, I've been told I have two minutes, so I'm going to just talk nice and slow. Uh, quick introduction or further introduction. Um, yes, I'm Brian Stavenger, a partner with ID Bailey. ID Bailey is a a national uh auditing and accounting firm. Um, we've got multiple offices in Iowa and and really uh the bulk of our practice is west of the Mississippi. We've got upwards of uh 20 offices spread across many different states. I'm sorry, 50 offices spread across probably 20 different states. Um but really really happy to be working uh with the city uh beginning with fiscal year 25. Uh we've been around uh for 109 years. Um roughly 70 of those working with local governments, state and local governments. um approximately 300 uh cities across the country that we work with um from an audit standpoint as well as an advisory standpoint. Um so a lot of different resources pulled in to uh provide audit services for the city for this most recent fiscal year. What I'll do is walk you through uh the results of the audit. Um we are very very close to getting uh issued and finalized. Uh so very confident in these results. What I won't do is walk you through the full ACTVER. that ACT for uh stands for annual comprehensive financial report. Uh the city uh really the finance department puts it together. I would venture to guess it's over 200 pages. Uh so I think you're going to be thankful that I don't walk through that. It has a lot of wonderful information in it, but can be a little overwhelming. So I'll walk you through uh what we've deemed the executive summary to really pull out the highlights of that uh allow you to ask any questions that you may have and then we'll move you on to uh the next item on the agenda. So, our objectives, which are really similar to uh previous years and your previous auditor, these really don't change. We all follow the same rules. Uh really making sure that you're spending

the money appropriately uh especially when it comes to uh federal uh funds or federal awards. So, we not only look at uh local revenues, state revenues, but also federal revenues and then how are all of those being spent. Uh our audit is designed to obtain reasonable but not absolute assurance. Um, and again, that is that is really a standard uh across any audit that you're that you're going to receive or any entity or local government's going to receive. So, we're not looking at things 100%. We're not going down to the penny. Uh, but we're really taking a sampling approach uh and a risk based approach, making sure where we believe there's the potential for misstatements or errors, we spend more time there. Uh, but we do look over uh most everything. So overall uh for the financial statements the city received a clean unmodified audit opinion. That really means that we believe based on our work that you're following all the correct accounting rules uh implementing new standards which there was a new standard implemented this year um all the proper disclosures in that act for uh and ultimately we can provide our opinion saying uh we believe it's it's accurate and fairly presented. So as I mentioned there was a new uh accounting standard implemented in fiscal year 25. uh it did not have a significant impact on the act for itself or the end result uh on the financials but a significant uh lift that it took the finance team and and likely other departments to help uh implement this was really just standardizing compensated absences across uh local governments. Um, so vacation is the big one, but uh really incorporating any and all leave and making sure those are reported as a liability on the financial statements. But again, not a significant overall impact other than, uh, a lot to get it all together for us to audit it. Um, but we believe that was properly implemented in fiscal year 25. Questions yet? Okay. I think a very uh significant portion of

the audit especially uh from where you sit is the audit over the federal funds. So we do this in conjunction with the overall city audit but this is very focused. Uh this is a requirement by the federal government. Really any uh any entity that spends $750,000 or more in federal awards. This is a requirement. Uh you have no problem exceeding that threshold. that is actually increasing uh next year to a million which you will continue to have no problems exceeding that. So this is something that you have had and will continue to have. Uh in fiscal year 25 the city expended uh just under $26 million in federal awards as we go through the process of testing that really the federal government provides a decision tree of what uh we are required to look at. So not a lot on of decisions on our end. it's really guided by the federal government and that is intentional to make sure that these audits uh here and in any other local government are consistent following the same framework. So we looked at four of the largest programs and tested those in detail really testing for uh proper internal controls meaning the processes have adequate oversight and review as well as compliance which is the big one making sure you're spending the money appropriately according to that grant. So over those four uh federal programs, three of them had that clean unmodified opinion. One of them had a qualified opinion, which means we had a fairly significant finding. Um and I'll walk through that on the next slide. Um while it's of significance, uh I think easily correctable. Um but again, I'll walk through those. Um the good thing is nothing surrounding compliance, meaning we didn't note uh dollars being spent inappropriately in the wrong areas or unaccounted for. nothing that way. Uh and like I said, I'll get into uh the details, but um that's a good thing. So, let's go through the findings. So, when you go when when when you have an audit uh done uh such as this, you can get those clean opinions, but you can also

have some findings. What we are required to do is to look at really the processes, the controls uh to make sure that they're adequate to lower the risk of potential error or misstatements or in the f uh in the in federal awards uh really spending the money inappropriately. So a lot of it is looking at controls and processes on the financial statements. Uh two findings really. We had two areas. Uh there there was a cash on deposits um that's been there for over a decade. There hasn't been movement on that since 2014 when we were asking about it. It's not a significant amount. Um you know, there was just really no support for it. So, it's really been there. Uh I would venture to guess uh that previously it was like, "Yeah, we should probably just write this off because no one really knows where it came from." Um through the change in auditor, we had that discussion. let's just take that off the balance sheet. Um, so we remove that and then there's a fund balance classification which is really your reserves at the end of the year. That's what fund balance is. It's really your reserves and I actually have a graph on that that we'll look at. Um, there's about five different classifications there. It's very specific as to how you can get them into those different classifications. One of them is referred to as a committed fund balance. Committed means uh that is at the council level. the council needs to uh really have a resolution, some sort of approval of that. We couldn't find that. So, it was really just a reclassification. So, it's not like you lost reserves. It's just a reclassification issue. So, both of those uh I think were good discussions that we had with management uh made the corrections and I think going forward um shouldn't have any issues there. On the federal awards, um so you can see there are three different findings. Um the first one in the CDBG uh grant uh and really all of these are just a lack of

formal documentation of review. So when individuals uh submit reports I shouldn't say when individuals when the city uh submits reports uh there needs to be a preparation aspect of that there needs to be a review of that and that review should be done by someone other than who's preparing it. Uh and then the submission ideally is done by a third individual but it could be just the first individual. Uh we just couldn't find any formal documentation of review. Um and that led to really all three of these findings. So I think a very easy fix. uh as we talked to different people we got a sense of I think there is review being done but when it comes to federal awards that has to really be written um evidential documentation can't just be talking to people so really it's just getting it to be a formality of a some sort of sign off or even electronic sign off so all of these yes findings um I think the the good thing about these are these are all very fixable um and can be fixed very quick but I definitely want to pause there uh to see if you have any questions on findings. Um as James mentioned, sometimes when you switch audit firms, this does tend to happen. Just different set of eyes looking at things a little bit differently. Um any questions, comments on those

review, can that be internal or is that an outside? Internal. Yes. All done internally. Yep. Okay. Thank you. Was that review documented with with other federal awards that the city had? So it was just a a practice that wasn't consistent throughout correct city. Correct. Okay.

Yes, we did observe it in certain programs, not others. So that's a great observation. Yes. Okay, keep moving along. So really from here on out just have graphs for you. Uh this is information pulled from the ACT for the financial statement document. It's got three years worth of information. You know I should I should have said and and I guess I'll say it now. Uh that ACTER which is a great document. It really for the most part only has one year's worth of information. Now there are parts of it that has multi-years but um for for this type of information for the most part um unless you go way to the back which again is about 200 pages in uh you may not see this. So really like to pull some of this out give you multi- years worth of information. This is all governmental funds. Governmental funds are really um you know taxes and intergovernmental type revenue. So, federal revenue, state revenue, that's where these funds really uh live and breathe as opposed to what are called proprietary or enterprise uh where it's more of a charge for service as a revenue stream that really runs those funds. So, these are all governmental funds. Uh the variety of of revenue sources and really giving you a three-year look back of what those were. These are in thousands, meaning uh add three zeros to the end of these. But you can see for the most part uh fairly consistent I would say intergovernmental on this slide uh you can see had a decline from 2023 to 2025. Very very common uh as those co era dollars have been spent and really spent down required to be spent down technically by the end of this calendar year. Um but this is very very common to see that intergovernmental go down as those dollars have been spent um to uh to fruition.

Similar look at all governmental funds except expenditures. So you've got a a variety of functions here where you spend dollars out of those governmental funds. Public safety, capital outlay, debt service. Continuing, here's that fund balance uh that I wanted to make sure I pointed out. So fund balance is really uh at the end of each year uh you've got fund balance or really reserves. This is looking only at the general fund. Uh you have many many different funds or departments. Uh but this is the general fund which is a common uh way to analyze kind of your reserves that main operating fund of the city. And what it does is it takes your fund balance that is unrestricted meaning there's no outside restriction. An example of that would be you receive a $100,000 grant. You only spend $50,000 of it carries over to the next year. That remaining 50,000 is called restricted, meaning you have to spend it on a specific area. This graph does not include those. This is really your rainy day fund reserves without any of those restricted dollars. This is flipping it into how many days do we have in that fund balance? Meaning at the end of 2025 or June 30th of 2025, if you had no more revenue coming in, you could operate for about 125 days uh with your reserves. So you can see a slight decline from 2024 uh but still a good spot to be. That's a roughly 4 months. Um generally speaking, 4 to 8 months is where we typically see uh a city. It really there is no right answer. There is no wrong answer. It's kind of internally and individually where do you want to be? Uh but you can see really if you look historically um

still much stronger than than 2022 and previously even though there's no right or wrong answer. What is a preferred answer? I'll if I could. Yeah. Uh well, first from an auditing standpoint, I would say what we typically see or what what what cities especially because it does depend on what type of entity you are. 6 months is typically what we see as a goal for a city.

Yep. So that's ambitious from a large city standpoint. Um, obviously we're not required to uh with uh keep keep that size. From a credit rating standpoint, we've talked a lot about uh trying to keep it above 25 to 30% of annual spend. Uh and we're very close to that 25 high 20s at at the moment. And the council's policy uh you may also recall we raised that from 15 to 20% of annual spend. And just for uh calculations, the 20% minimum is uh 73 days. And so you'll see that we've always exceeded those 73 days. And a better target is over 80 to 85 days. So I would anticipate that purposefully we'll take that 125 days down just a little bit further as some of those are uh committed funds not restricted as he mentioned but we do have commitments to some of the remaining balance to spend from from the ARPA days that are just finishing out in 26. Thank you.

That was very helpful for me uh to hear you know really since I don't have the history with you that was helpful to hear. So exceeding your internal policy and very much within range of what we typically see. And that was a great point. Generally the larger you get um the smaller that reserve is as a percentage or in days um just because you generally have kind of more you just have you're working with bigger dollars. Let's put it that way. Any other comments or questions on that one? Okay. This is operating income or I guess there was one instance of a loss in the municipal housing fund in 2023 but this is excluding depreciation. So in these enterprise funds or these proprietary funds, these are operated more like a like a private company. Really uh the intent here is to generate income uh to support the business and most of it uh the revenue streams are are through charges for services meaning there's a a user charge. We exclude depreciation. Depreciation is uh really an accounting only type uh entry on an annual basis that takes your investment in assets. So uh there can be infrastructure in a lot of these thinking of sewer, storm water, you've got underground infrastructure. When you when you spend that money, it actually um go shows up as an asset to that fund and then that is slowly depreciated uh through the life of that asset. That depreciation again is not a cash outflow. It's really just an accounting entry. So we exclude that because it can be potentially misleading. It is a part of the financial statement. So when you look at it as a whole, uh it's certainly in there. But for the purposes of this analysis, uh and this is very common, exclude that depreciation really say outside of that are we generating an

operating income. And like I said at the beginning, outside of 2023 in housing, um, you have generated a positive operating income in all of these funds. Oh, could you go back? What What's the significant decrease? It's still positive, but on the parking side, is there an explanation for that?

Anyone got it? Uh we can dig into it a little bit more, but uh generally speaking, that's going to be like an increase in purchases of supplies towards year end. Like I know the solid waste one off the top of my head, there's a large purchase of totes um towards the end of fiscal 2025 that drove that down. I think it's similar in parking. It's not an issue with revenue. Revenue has been pretty consistent. I know that much. So, it's going to be on the expense side. So, some sort of maintenance or

Exactly. Yeah. Some sort of heavier maintenance or something like that. Just to add to that, we typically don't issue bonds uh for the parking side. So, we save up that cash for the larger capital items, whereas you wouldn't you'd see uh the general fund is treated different very differently. So, Scott, in the parking arena, not to get into the weeds, but I am. Um that's fine. Major repairs of parking structures, does that come out of a different fund? No, that comes out of the parking. That's 1.53 million is not very much money.

True. True. And just to have it positive, again, these are enterprise funds. Um, and so it's it's good to see that they continue to be very positive. And I would anticipate, I'll just throw it in there, that in 26 we'll see some additional changes due to this this sale of 9inth and and Locust, which was one of our larger garages. All right, an opportunity for any additional questions or comments before I depart the microphone and on to the next topic. Thank you, Brian. Do you have Mike? Do you have a

Yeah, I have a couple of questions. Where do you call home? I call home Fargo, North Dakota. Would you say we have a really good staff? Putting you on the spot. Did you audit our staff?

Yes. The answer is yes. Um I think what I observed is not specifically to the audit but just kind of a feeling of overwhelmment and not not like not like over the top just there's so much responsibility um especially in the finance area just dayto-day. Uh, and then we come in and ask all these questions and we're new auditors and uh, we have different types of questions. Um, and they were wonderful to work with and we got the answers that we we needed. I could just sense that there's there's a lot going on. Um, so I think you've got wonderful staff. I would just keep an eye on them to make sure that they feel supported. When you come into a community as part of your audit services, do you make recommendations uh observations of what other communities are doing in terms of process? Well,

we we can and and that's done informally. Um it's not a it's not a required or formal uh result of our our process but informally yeah if we have observations of potential uh improvements in efficiencies or just different way of doing things we we at least share those and thank you. Yeah. Any other questions? Yes. Uh just I think maybe for the city manager the mayor. So does the audit report come back to the council and is it an receive and yep to receive and and file uh probably two weeks when they get the formal okay next council meeting it should be

all right thank you okay anything else if not thank you okay Nick and his team for all the work that they have done

so next up blank park zoo Okay, good morning. Thank you for inviting me here today um to kind of share some of the things that are happening at the zoo. Um I have um some slides on some highlights from last year, some of the things coming up this year and then just some of the challenges that we are um working through. So um just to kind of start out I think hopefully all of you are familiar with this but this is our mission statement. So everything that we do goes around um follows this mission statement and and really our four pillars. So conservation, education, research or and recreation. So 25 uh highlights. One of the exciting things is is we had a total audience of over half a million people last year. So this is really exciting to hit that benchmark. Um, this is something that we're hoping to continue to grow. One of the big reasons that we think we hit this uh number is because we hosted a dinosaur traveling exhibit last year. So, we had 15 robotic dinosaurs that moved and made sounds, you know, throughout the zoo. Um, one of the things that we did is we um did some business planning looking um three to five years out. So, we're hoping to bring dinosaurs back again in three years um and kind of keep that that cadence in amongst um other things that we do. um conservation. So, uh we've done several things in conservation. Um one is our upcycle program. So, we work with

Pulk County Conservation as well as De Moines um city parks. Um we have staff and volunteers that go out into the parks and help remove invasive species like honeysuckle for example. And then those um branches um many of them are brought back to the zoo and used as brows for some of our animals. So, it's kind of a nice um communitywide conservation effort. Um, another one that we started a couple years ago was Blandings Turtles. This is a partnership with the Iowa DNR as well as Iowa State University. It's a grant-f funed program. Our role is to headart baby turtles um for release. So, u the DNR and Iowa State will find pregnant females. They come to the zoo. They hatch they lay their eggs um at the zoo. She then goes back to the spot where she was found. Um and then we hatch the eggs um raise them to a certain size and release them. So last year we had our first releases um which was really exciting. So we uh um first batch was 56 uh turtles that we were able to hatch and raise. Um we held back 12 um on the request of the DNR because they were um rehabbing the area that they will be going to. So those 12 will be released at the end of May this year um which is exciting. And then we have another batch of eggs and hatchlings that we're currently raising right now for release um this throughout the summer as well. So this is through wetlands um throughout really central Iowa is what we work on. Um our main project that we've been working on from a national standpoint is the Florida Reef Project. So we've been working on this for since 2018. Um where we have corals and our job here, these are healthy corals from the Florida Reef track. We work with 26 other organizations around the country on this. The Florida Reef Track, the Stony corals are being decimated. So, our job is to um keep these corals healthy and then reproduce them. And

then the offspring of our corals will be going back to repopulate the reef down in Florida. So, um this year we started the reproduction process, which is um really exciting. These are all corals that have never been raised in an aquarium setting before. So with our partners um this is something that uh we've been working on and then we have several um international projects that we support as well but these are the the main ones from a local and national um perspective in our education programs. Um we tried a new program called play and do this year. So thinking about uh families and what families need in the wintertime and so we opened up our water lab space in the discovery center and set up activities uh moderated by one of our educators. So, every Friday, Saturday, Sunday, and Monday, uh, families can come and have extra activities to do within the water lab that are all hands-on exploration activities. Um, in addition, our summer camps had over a thousand students. Many parents use this as child care. Um, we have programs that's 9 to 4 is the camp program and we have before and after care to accommodate um, those parents. Um, and we are pretty much sold out um, when you get to that that thousand um, thousand child uh, number. Um and then zoo crew. This is a program for our teenagers. So this is 13 to 17 year olds. Last year we had 184 students that worked at the zoo um contributing over 5,300 hours of service and they work in all different areas. This is really a job um job training program for those students. So they go through an application process, an orientation, and then they do certain jobs um throughout throughout the zoo. And then we have return students every year. they can do it for four years before they graduate into the um adult volunteer section. Um when they turn 16 um we also will hire many of them in our guest services area. So they it turns into a paid uh job for them as well.

The other exciting thing is um we broke ground on one of our capital projects. This is the Marjorie Foster Lion Conservation Center. So this is a new area that is going to go up next to our event center. um and it is currently under construction now, but in May we were able to um break ground on that facility. It's about a $6 million project um to expand the lion space. And in November, we were able to break ground on our Wild Iowa area. So, this is an area that was a garden space in the zoo next to the sea lion pool. This will be um adding otter, eagles, bobcats, and then smaller aquariums like uh amphibians, fish um and reptiles that'll be rotating aquariums in one of the cabin spaces. Um so it's really exciting to actually start construction on these uh two projects. Um and then uh our map stations is a photo over here of one of our new map stations. And so we added new wayfinding signage and map stations around the zoo for information. Those are all um the four frames we can all change out depending on what is happening around the zoo. We have a QR code for people that can download the map themselves. So we don't have the paper copies um anymore uh out that are distributed. And then one of the big things that we did is we added more symbols to the map. So taking away any um barriers uh language barriers and so adding those symbols instead of words um on the map has been um helpful as well. Um and then we were honored to um have a received several awards um last year including um our summer camp um was runner up for from De Mo parents uh awards um and then um some tourism and um recreation awards as well. So very proud of those things. The other big thing that we worked on last year, um, as you may know, I think

I can't I think I spoke here two years ago, we were talking about COVID and the effects of COVID and nonprofits are still, um, trying to figure out what our new normal is, you know, from there. Um, we feel like in 24 we started to stabilize a little bit more. Um, last year we took the year to work on an economic impact study. Um, we had one from 2016 but needed to update it. Um, we chose to delay it until we could make sure that we were in a little bit of what our new normal will be. Um, and then we also did some business profiling and some business planning. Um, this was all done by Canopy Strategies. It's a company that works with zoos, aquariums, and botanical centers um, around the country. So, here are some of our key findings. Um, so 52% of our zoo audience comes from within a 30 minute drive time. So they analyze the drive radials around us, but one of the things that was really exciting to us is 48% of our audience comes from outside of 30 minutes. So when you think about the impact on tourism for the area, this really um drove it uh bringing in people from that far of a distance. And even more surprising, especially when we were benchmarking with other like institutions around the country, um 24% come from 90 plus minutes away. So we are really truly attracting people from around the state and even outside of our state. So um one of the other things we looked at was just our demographics and uh we benchmarked on the the market for different race and ethnicities. So, what is our market and are we meeting those? And again, what was really exciting to us is um we met all of the um market percentages and in some cases um including Asian, Hispanic, and black markets, we exceeded those. Um so, we were higher than what the De Moine percentage is. So, again, attracting

people from um all different areas. One of our initiatives that we started about 15 years ago was to really become a zoo for all. And so we wanted to look at how we can be accessible for all different populations. And so this is some data that we're starting to see that we feel like um was really positive and some of the efforts that we've put in. Um the other thing we asked is a broad range of audiences. So we looked at economic um income of families that are coming um from all around the area. And one of the things that came out of it is that it appears to be uh we're accessible for a broad range of audiences and income levels. So again with our initiative to try and be a zoo for all we feel like those uh things are starting to work and we're starting to see that. So um other key findings when you look at our economic impact um this actually has increased from our 2016 study. So, our average e economic impact per year is $42 million for PK County. Um, and so that includes all of the um work that we do internally, but a lot of it is the audience and driving the audience from outside the area that's coming um to us over here. Um, we support about 305 jobs annually. So, we have 90 full-time staff, but we also hire about a hundred seasonal staff each year. Uh, and then we also have contractors that we work with as well. So that's how they got to that 305 jobs um number. Um between 2019 and 2025 we attracted 1.8 million out of county visitors. So again going back to the tourism impact um that was an exciting uh exciting number for us. And then they looked at some of our capital projects and what we expect from an economic impact um as those capital projects are worked on and completed. So $43.2 2 million in economic impact just from those capital projects.

So what's coming in 2026? So one of the big things, this is our 60th anniversary. So May 8th, 2026 is the official 60th anniversary date. Um so we do have a celebration um thanking those that have been a part of our history for the past 60 um years. So uh invites have gone out and then we're doing a public celebration on May 9th. So, we're in the process now of collecting um stories from people in the community. We've reached out on social media for people to share their pictures and share their stories. We're also doing some videos um as well from those that have been involved um in our history as much as um as much as we can um find those individuals. So, throughout the year, you'll be hearing about the 60th anniversary. Um, we're also putting together um a video that will be shared not only at our our celebration on May 8th, but also um on social media afterward. And then we'll be doing 60 60-second videos throughout the summer of um different parts of our history and um different parts of our story um and involving those community members and those memories that people have had over the past uh 60 years. Some of the repairs and improvements that have happened over the last um year um is our gift shop remodel. We did this in January of this year to prepare for the season. Um it was pretty dated. It was about 20 years old. So we refreshed that um with adding different um obviously paint but also different structure or uh different uh displays um that we can have. This is one of our big sources of revenue is our gift shop. So we have a gross revenue of over a million dollars a year and so it's a really important space for us to make sure that we keep it updated and maintained. Um we also added a new point of sales system. It was fully implemented at the end of March. This was really important for us because it allows us to take some of those demographics that we took from our economic impact study and business study

and do some of those things on our own. Now um as well as improve some of our marketing strategies um with the new system. Um then we did some roof structures. Um right now we have where the main entrance um it's currently under construction, supposed to be done the end of this month. Um it was a flat roof that is leaking everywhere. So we're adding a pitched roof um and doing some improvements to that space. Um we redid our zebra yard and added cory busters which is the largest lighted bird um in Africa. So they'll be um in that space um over there. We repainted our seal and sea lion pool. Um we're doing reeding in several of our exhibits. And then we did some work with our um fire alarm systems in some of our barns and in our discovery center events that are happening this year. So our first um fundraiser is our Gators on the Green. That's on May 12th. That's our golf event that's happening. This happens at Legacy in Norwok. Uh, dream night is an event that we've been doing for I think it's around 14 years now. This is a night that we actually don't publicize and we work with partners um at in De Moine in the De Moine area and in Iowa City. This is for um kids that have special health concerns or health needs and their families to have a free night at the zoo. And so our partners help subsidize that. All those this is an invite only. Um and our partners are the ones that send out those uh invites since with HIPPA laws we can't have that mailing list. So um they do that each night. Um we will have about 14 we cap it at 1,400 um people. So it'll be um two big nights for us there. Um Zubus are coming back. That's the adult only event every Wednesdays in the summer. Um so we have different themes and bands that'll be playing each Wednesday. Safari for is a

another fundraiser for us that'll be in September. Uh and then we started something new this year. We're doing discover the wild days throughout the summer. So we have different themes. A lot of them are revolved around pop culture themes and then we have partners that we're working with. For example, in July we're working with uh Iowa Public Television um where they're bringing in some of their characters um and costumes um that kids can enjoy while also um seeing the zoo. And then we've added several other events last year and this year including unccorked and and other popup events like trivia nights and popup Zubus that we did um throughout the winter. Uh and then I did put in here I did not put in here but we also have night eyes um that is in the fall. Um that's our annual Halloween event. Uh this year is one our first year too that we have a new conservation project. So this is working with Wyoming toads. Um we have nine partners around the country um that we work with. Um this is a species that is extinct in the wild. So it is not found um in in nature anymore. Um so we are working with our nine partners to raise them at the zoo and then release them back into their native habitat which is a county in Wyoming. So our first release um will be June this year where we release tadpoles and then some of the froglets that we raise will be released um later in the summer. So another again another exciting thing that we can do um in conservation some of our new animals um this year. So on the left is our walabe. You can kind of see in the pouch something sticking out. We have four joeies so far. Um this year um we have the largest uh walabe mob in uh North America, so outside of Australia. Um so that's exciting. This is a species that we concentrate on and we have staff that oversee the um the

breeding plans um for these species. Um the center one is our cotton top tamarind. This is also a critically endangered species that we work with on conservation programs. They're from a rainforest in South America and a small um section in Colombia. um we work with other partners on breeding programs, you know, for them. And so we had a new little baby that was born um earlier this year. So her name is Blanca. She she is kind of sticking her head out um over there. And then our harbor seals, our harbor seal and sea lions are all rehab animals um that we receive um and we provide their forever homes because they're non-releasable. Um we'll actually be getting a new harbor seal this year from the Los Angeles Zoo and he was born there. um he will be an important breeder in the future um when a female is identified from him. So our goal would be to breed um those animals in the future. Um oh and I should say one other thing I did not put a picture up because it's not released yet. Um but we are hoping to have two baby giraffe this year as well. All part of the breeding programs. So I'm exciting. Um we're also adding some new experiences to the zoo this year. So, uh, Barnaby is our tortoise. He is the only animal or person that's been at the zoo for the past 60 years, um, in our history. Um, hopefully several of you have been able to meet Barnaby. Um, he's a pretty special, um, animal that we interact with. He loves attention and loves people. So, we're actually opening it up. We've done behind the scenes tours with him, but we're opening it up for the public. So, um, when you come to the zoo, you have the option if you want to do a Barnaby interaction um, or not. And so we'll be doing starting that Memorial Day weekend. Uh we do behind the scenes tours currently. Now we're changing the structure of those to make it easier for people to sign up um for those interactions. And so part of our new point of sale system is allowing us to do some of these things when people um

book their tickets online. So we'll have regularly scheduled tours every day Memorial Day through Labor Day that people can sign up for. And then our alpacas. This is a partnership we work with Rusty Stars Alpaca Farm in Winteret. We've been doing it for the last four years. They're coming back again um Memorial Day. They're actually arriving at the zoo today um for quarantine um and training and then they'll be ready for the public Memorial Day weekend. And we're adding alpaca walks um to the schedule. So you um people can sign up to come earlier u before the zoo opens and do a take them for a walk around the zoo and then um enjoy the rest of the zoo the rest of the day. So again, just some fun interactive experiences. One of the things that we learned when we were doing our business study and um kind of benchmarking is what audiences want and what audiences are looking for. And they're looking for interactive, unique experiences they can't do anywhere else. Um so here's um a couple of the experiences that we've added based on some of that that research. Other things that are happening this year is our Lion Conservation Center that we broke ground on last year is well underway right now um with it looks like a mid August opening date. So um pending any weather issues that we have in the spring and summer as of now we're on schedule. So we'll be announcing this uh later this year u uh when that opens and we're able to do the ribbon cutting on that project. This will quadruple the uh it's actually triple the size of our current lion habitat. Um we have three new lions that are coming to join us. All that will be part of a breeding group. So the two lions that we currently have are 16 years old. So they're at the end of their life. So this is planning um for the future. So um it'll be really exciting. And then uh with the this larger facility, we'll become a bigger player in lion conservation and in the breeding of

those of those animals. Whoops. Um, other things other we broke ground officially in November, but we're currently under construction now um for Wild Iowa. So, our goal is to get as much of this project completed by the end of September as that we can. Probably a ribbon cutting will happen um early 2027. Um, but we want to get all of our structures up and get most of it completed this year while we have good construction um construction weather for it. Whoops. Um, so challenges that we're working with, you may have um saw on the register our wildlife festival that we hold um in the spring. We've been doing this for the last five years. Um this is um postponed as of now. So, the artisans that we bring in for this festival um were denied their visas um to come in. So, um we're working with the company to see if we are able to do it later this year or not. Um to give you an idea, it's about a net revenue of $250,000 to our budget. So, that's something that we've been um working on. Um some of our new experiences, some of the other things that we're adding um to get us to hopefully balance um that it'll be a challenge this year for that. Um rising costs, especially in personnel costs um is another issue. So, we've been working on um personnel for quite a while now. Um about three years ago when I did the presentation, our staff um made an average of $12.50 an hour. So we've raised that, but every time you raise that, that adds to the um budget as well. So we're still not where we need to be. About 77% of our staff make less than $25 an hour. So it's something that we need to continue to work on to make sure people are getting livable um wages.

So our train engine is um one another revenue source for us. Um so we're hoping to at some point get add an electric engine. Um right now our engines are old um and they're gasoline you know engines. So if we can um purchase an electric engine that would require not only the purchase of the engine itself but also the construction for the charging plates. Um we would have charging plates at the station and then in the tunnel where it is stored. So, um, the whole total cost of that is about $350,000. So, we're working through kind of a grant process now to see, um, how we can potentially fund this, um, for the future. Um, some security improvements. Um, the De Mo Police Department was really helpful. They, um, last year came out and did an assessment for us of where we can look at, um, maybe some, uh, things that we can improve upon in our security and some suggestions that they would have. Um, some of that is adding more cameras um to the area, adding um blockades around our um entry plaza um as well as some interior um gate structures. Um so those have been put together. We did submit a grant to Homeland Security. It's pending right now with the partial closure um and the government level, but I did receive an email that hasn't died yet. So um that's good. Um but hopefully um we'll be able to add some of those uh improvements here in the future. Um and then just our capital campaign, we need to uh finish it up. So right now we've raised over $15 million so far for those projects that we've started construction on. Um so with rising construction costs um that's something we need to um we need probably about another three million uh to raise um to finish out the project. So we'll be working on that this summer. So, I think that is everything and a really quick quick report. And does anybody have any questions?

I can remember as a kid we would save our dimes for the zoo. It was a Bill O'Reilly show. I I can't remember specifics, but I just know we all of our all kids were encouraged to save their dimes, right? It was out in the schools, right? Yeah. We saw um several we found several newspaper articles on that. So that was really exciting. And then um we're interviewing um Bill Riley Jr. um to help tell some of those stories and what he remembers as well. That was a big deal. I mean that was 60 years ago, right? Is there any other any other questions? Carl, you're up on

Yeah. um for the 60th anniversary, is there anything that's out in the community that uh people could look forward to?

Yes. So, I know what Carl's referring to. So, one of the other things we're doing for our 60th anniversary, what we're calling our roar and explorer program. So, we have um lion sculptures. We have 12 lion sculptures that we'll be sending out um into the region. Um, and so these were all they're about four feet tall, about six feet long. They're made of a sheet metal. It's a silhouette of a male lion, and then the female silhouette is cut out and kind of offset from um each other on that. Um, the exciting thing about this is they were created by our own facilities team. So, they um designed them and made them, you know, all um it's all done with welding. And then we have local artists that are painting each of them. So they will all be um different from all Iowa artists. And so they'll be out around the community. We'll be announcing that kind of trail um that where you can find them all on May 8th at our celebration. So yeah, and Carl may or may not have his own.

I think there is one. Yeah. Oh, good. I can find one. Yeah. Again, thank you for what you do. It's a great amenity for our residents of De Moines and you know 60 years. Wow. Yeah. Happy happy birthday. I guess that's 60 years of doing good things for our community. So thank you for your leadership. Yeah. Thank you. And if anybody hasn't been to the zoo for a while, please let me know. I would love to take you on a tour and show you all the different projects that are happening. Um and all and this was just a really quick snapshot of all the things that we do. So Okay. Thank you.

Thank you. Okay, we wanted to give a I'll turn it over to our city manager, Scott. Wanted to give a quick update on the legislative. A lot of things are moving pretty fast and we just wanted to hear some of the latest updates regards primarily a lot of it to the property tax. So, yep. I will turn it over to our city manager.

Thank you, mayor. I've asked Emily and uh Jen to present on this topic. We will continue uh to meet and discuss as things continue to change, but we thought this would be the best opportunity to bring forward uh what we're seeing is likely the final products uh from each of the chambers uh the Senate and the House and uh there'll be some more discussion this week that may tweak it, but for the most part, if we can do you have one more essentially um uh this This will be able to inform you on what those differences are as we continue. Do we are we good?

I think uh maybe Tom needed one there. Thank you. Uh as we do the analysis and the actual fiscal work. So we'll have that uh at later date, but we wanted to make sure you understood the methodology that they were using and some of the terminology that's in the the language. So with that, and this is as of last week, correct? Correct. Doesn't mean it won't change tomorrow. Correct.

Good morning, honorable mayor, member members of council. Emily Harris, government relations manager for the city. Um, as Scott said, we will go over both the House File 2745 and Senate File 2472 as well as the House Amendment that was filed last Thursday. Um through that process, we will look through where we've been with our property tax changes in previous legislation, where we're at in our current legislative session, and then we'll compare the similar divisions in both the House file, Senate file, and the House amendment. Um and then we will go through some elements that are only within the House file, elements only within the Senate file, and then we will conclude. And I will apologize. This is a lot of information and it's just going to feel like I'm talking at you for a while, but it's all it's all good info. So looking back at some of the historical changes made in the past um 20 years, we had Senate File 295 in 2013 which lowered the taxable value of commercial and industrial properties from 100% to 95%. It also introduced a new commercial property tax credit as well as the multi-residential property class. It reduced the residential and agricultural roll back tie from 4% to 3% and included backfill uh due to the lowering of that commercial industrial taxable value. We had a period of silence until 2021 where Senate File 619 was passed and eliminated the backfill for commercial and industrial properties established within the Senate File 295. The bills that you're probably most familiar with um in recent history are House File 718. This was the most

comprehensive package that we've seen in the past 5 years. Um it introduced those graduated reductions on the 810 levy. Um so if you had less than 3% growth, there's no reduction in the taxes that you collected. If you grew within 3 to 6%, you had a 2% reduction. and anything over 6% has a 3% reduction. Um, it also reduced the number of levies available to local governments all together, uh, consolidating most of those into that now capped 810 levy. It also eliminated the multi-residential property classification and merged multi-residential back with residential. And then in 2024, uh, a little bit of cleanup to those graduated reductions. Anything under two, uh, two and 3/4% growth, no reduction. Uh, 2 and 3/4 to uh, just under four, 1%, four to just under six, 2%. Anything over six is 3%. Where we currently stand in the 2026 legislative session is that we've seen multiple proposals, one from the House, one from the Senate, and one from the governor's office. Um, within those pieces of legislation, the Senate file was amended on the Senate floor and has since been passed off the Senate floor where it awaits action in the House. The House file was amended and passed by the House Ways and Means Committee and is awaiting um action on the House floor. And then at this time, we believe that pieces of all three bills will continue to be negotiated and combined into some final package ahead of the end of legislative session. So, we'll start with comparisons of

divisions that are shared in both the House and Senate um proposals. Probably the top of everybody's list is the revenue caps. Um so, within the House file, it establishes a 2% hard cap across all of the operating levies, not just the consolidated general fund. And there is no minimum budget guarantee within the Senate file. It establishes a.5% budget guar minimum budget guarantee or up to 1 and a4% growth on general levy from for fiscal year 27 and fiscal year 28. After fiscal year 28, it establishes up to 2% general levy growth for fiscal year 29. And it also ties that with what is being referred to as a soft cap on the general general levy growth um in FY30 and beyond. There's a potential uh incremental increase in times of high inflation based on fluctuations within the consumer price index urban or CPIU. And then again, these caps don't guarantee that amount of growth. If you fall below it, then you only retain what's below it. New valuation definitions are included in both the House and the Senate. You'll see those definitions uh up here and in the presentation. You'll notice that neither definition accounts for TIF divisions under 40319 as TIFF valuation is released. So the House file has additional language where the Senate file ends at three provisions. In terms of tax increment financing, the House file removes the 540 school foundation levy from future TIP agreements under 40319,

but allows a school district to opt in. So, a school district could decide that underneath that district, they would like those funds diverted. 20 years after the bill's effective date, cities can only collect up to 60% revenue uh generated on the pro perpetual tiffs and it limits future tiff districts certified after the effective date of the legislation to 23 years. So a hard phase out. The Senate file limits urban renewal areas and tiff districts to 20 years unless otherwise approved by the department of management. requires perpetual tiffs to be closed within 20 years with no additional indebtedness allowed within the district as it's phased out. Prohibits additional indebtedness in existing perpetual tiff districts after the enactment. It also removes the 540 school foundational levy from future tiff districts, still allowing for the opt-in option for the district. prevents TIFF incentives for relocation from one city to another city within the state and prohibits the use of TIFF revenues for the salaries or benefits of permanent staff members of a local government or regional economic development authority. Regarding bonding, the House file prohibits the use of bonding to fund general operations. It adds a second date for bond referendums in June, but prohibits bond referendums at two consecutive election dates. So, you have to wait a full year in between. Um, and then this is where we start to see some differences between the current House file and the amendment filed last Thursday. Um there's additional language within um one of the definitions to include 422.3 and then Senate file

prohibits the use of bonds or debt for general operations. Both bills move a lot of what exists currently as credits to exemptions. And so you'll see a lot of those changes within this section of the presentation. In the House file, after roll back, all residential property receives an exemption of 25,000 or 10% of the taxable value, whichever is lower. The House file also introduces or increases the business property tax exemption from 150,000 to 350,000 which is then subject to the residential roll back with the remaining valuation above 350,000 to be taxed at 90%. Within the House's amendment that is currently filed, the amendment would lower the additional 25,000 or 10% residential exemption just to a flat 15,000. And the amendment does not address that increased business property tax exemption. the Senate file um an assessment year 26 uh and after a roll back at 55% the homestead exemption of 5% taxable value equal to and not less than $4,850 but not to exceed $35,000. And then in assessment year 27 and beyond, the roll back is frozen at 65%. The Hemstead or Homestead exemption is 15% taxable value equal to and not less than the 48.50 and 550K. Both bills address senior property tax reforms. In the current House file, there isn't anything alluding to senior property tax

credits or exemptions, but within the uh amendment filed last week, it would allow for an additional $6,500 exemption beyond the 15,000 homestead exemption for seniors. And then in the Senate, you'll see those graduated um exemptions based on age. So seniors will receive a homestead exemption based on your age. If you're 60 to 69, 60% exemption, 70 to 79, 70% exemption, and so on. However, none of those exemptions may exceed 350,000 at each tier. So, that's regardless of your income,

correct? property roll backs. There are no changes within the House file to the property roll backs. But in the Senate file, the like we discussed before at assessment year 26, the roll back is set at 55. And then at assessment year 27, the roll back is set and frozen in perpetuity at 65%. within the assessments um in the house file. If a property's assessment increases by 10% or more, the assessor must provide a statement of reasons for the increase specifying what caused the increase. And then in the Senate file in assessment year 26, commercial and industrial increases to 93% and then to 100% in assessment year 27 for valuation beyond the first $150,000 which is taxed at the residential rate. Some of the some changes to the city budget statements that property owners receive every spring. it. The house file would res redesign the form um and the statement that is compiled and sent to all property owners and it directs the department of management to work with the Iowa League of Cities and the Iowa State Association of Counties to develop a new reporting form. And then in the Senate file require statements to be posted on websites and notices posted on social media rather than mailing the statements to each property. for veterans credits. The House file as it stands does not address the topic, but the amendment filed last week would establish a 100% exemption for veterans who received the Homestead credit prior to August 6th, 1991, as well as 100% exemption for veterans who have been classified as totally disabled along with surviving spouses and children.

Then in the Senate file, it establishes the military tax exemption equal to 2% of the taxable value. The exemption must be at least $5,000 but cannot exceed $14,000. Looking at specifics to House File 2745, which are not included within the Senate file, um it implements a reserve fund limitation. Um so any of the unassigned reserve funds a local government has on hand cannot exceed 35% of the local government's general fund. Then additionally, it implements a local government efficiency commission and grant program. Um the house file itself allows that commission to be housed in either an IEDA or with Iowa State and then it also allocates 10 million for grant awards to incentivize consolidation of shared services. Um within the House amendment, something small, they just remove Iowa State as an option to house the commission. pieces specific to Senate File 2472. Um it reestablishes that multi-residential um classification as a unique property classification for taxation. It is subject to an 80% roll back changes to transit levy re revenue. It reduces the current maximum levy rate at 95 cents to 88 cents. And then in fiscal year 27 and 28 their growth is capped at one and a quart one and three/4ers percent and then in fiscal year 29 and beyond that growth is capped at 5%. It also includes provisions for the gas tax. So the fuel excise tax will increase annually to match the CPI if the CPI is positive. um the hybrid and electric vehicles as

well as electric motorcycle registrations will also increase annually to match the CPI. And then within the local option sales and service tax, it allows a city to increase their lost from 1% to 1 and 14% but requires that increase to be approved by voters at election. Thanks. A lot of information. Uh I might turn it over to our city manager to kind of recap because this was more just an information to find out what's going on because we said it could change tomorrow. So

I think the the key here and thank you Emily uh for getting that amount of information boiled down. It's it's good to remember though that these are the highlights of the difference. Uh both bills are uh you know 70 80 pages long. Uh there is quite a bit in each of them but we needed to condense this in some fashion. I think we've done a good job of highlighting uh the most important aspects as they affect city government. Um again uh we know that there are additional meetings even today uh that they will be meeting to discuss and so uh it's still very much ongoing. Um, also understand that some of these numbers are going to be incredibly difficult to really hone in and be accurate like the exemptions for our older uh seniors. Uh there are not really good uh databases out there to to help us distinguish uh where the cut offs are for for those type of uh exemptions. So uh and yet they are fairly large. Uh so the there'll be a high magnitude and unfortunately a low amount of accuracy uh to be able to predict that. And once again reminding uh that was in the presentation that with the property tax caps that are in there uh those growth percentages are only available if we actually do grow the valuations after all these exemptions for seniors and veterans and all those things are calculated. If we are fortunate enough to grow above the 175 or 2%, we're allowed to then keep the that cap capped amount. But often times we are actually lower in the past than 2% uh growth. Uh with now these proposals, we would not have the

opportunity to regain that in a good year. Uh which has historically been the case where we'd have low years, high years. This would mean low years or even lower years in both proposals, but we'll continue to get you numbers and uh actual impacts as we're able to grab uh whatever databases we can to to finalize those. Okay. Okay. Thank you. Like I said, questions. Can we have

We're really just This was kind of an update so we can because until we can find out more. Well, um I only mentioned the governor's proposal, but so like are there anything just at a uh high level anything different in the governor's proposal then or is that even being discussed now or is is it at this point? There are pieces of the governor's proposal in both the House and Senate files and so we we assume that okay the governor's proposals will continue to be negotiated between both chambers.

Okay. And and one additional question will eminent domain be hashed out before or after property tax? What's what's the best guess on that? I don't think that I have enough information to give you a correct answer on that question. Okay. Okay. C can I ask on just information presented to make sure I understand it? So the cap in the House bill applies. Could you help? That said all levies. Mhm. That's correct. So that that that's significantly broader.

The difference there is it also applies to the pension and healthc care levies. Okay. So with for example health care costs when they go up 20% a year we could only go up two we're going to be capped at 2%.

Right? We'd have to make that up somewhere else because we would still have to pay the cost of health care and pensions but we would have to make cuts elsewhere in the budget to continue those payments. an understanding I think you all do it here but for the general public is what we pay in our retirement accounts is dictated and controlled by the state as well with both IPERS and the 411 system. So uh there's not a choice as to whether or not to pay it. We will have to pay those costs and then make room for that within our budget with other cuts. But the Senate version only caps general operating the general operating levy.

Correct. Which is salaries and and contracts and things. Still still significant because if salaries are increasing beyond 1.75% that's a problem. There's there's a gap that you have to there'll be a gap a larger gap. And and so we either can't increase salaries at CPI or cost of inflation or we're we're forced to make cuts. Yes. That's the way the math would work. Yeah.

Okay. A lot of work yet to do. So, uh thank you for the presentation and keeping us updated as much as we can because it does change pretty quickly. and uh we will reconvene at 5:00 p.m. for our regular uh city council meeting. Thank you.