City Council - Special Meeting

This is the city of Iowa City uh formal agenda for a special formal meeting, April 7th, 2026. And I'm going to call it to order. is 4 p.m. Um, and we will start with roll call, please. Alter here, Fergus here, Harmson here, Mo here, here, Teague here, line here.

All right, want to welcome everyone to your city hall. Good to see counselors and staff all back after a little bit of a break. Uh, item number two is the regular formal agenda. to a proposed property tax levy. Public hearing on the proposed property tax levy and the proposed budget ending June 30th, 2027. And I'm going to open up the public uh hearing and welcome Nicole.

Good evening, mayor and council. Nicole Davies, finance director. Uh so, as the mayor said, this is the public hearing for the proposed property tax rate. Um this year is a little more confusing than normal because we've had multiple things moving. Um the first being the general levy has been reduced slightly. That's due to the tax legislation. That's a forced reduction. So that reduction then we offset with an increase to the employee benefits levy and an increase to the debt service levy and then decrease the debt service levy 20 cents with the local options sales tax. So net result is a 20 cent decrease to the property tax levy. I also added another slide this year just because I've seen a lot of comments that have a lot of questions and confusion about these notices that get sent out. So first the state mandates this notice. The county we don't have any control over the form or what's in it. So I kind of laid out what the notice mailed out by the county shows. It shows our rate going up 1.89. 89. The problem with the notice is it assumes that everyone's uh home went up 10% in value. Most people's in Iowa City did not. I think what I use was 5 and a half. I think that's about what my home was. So, if you figured a 5 12% increase, it would actually be a 2.29% decrease in tax. So, just kind of one of those things if people have questions, what the notice shows is assuming a 10% increase in value, and that's not reality. So it makes this notice kind of even more confusing than it is. But any questions?

All right. Anyone from the public like to address this topic? If so, please come forth. If you are online, please raise your virtual hand.

Welcome.

Hello. McKenzie Daroo here with Greater Iowa City, Inc. On behalf of Greater Iowa City Inc., I'd like to thank you for your careful consideration of how best to use the new revenue from the local option sales tax passed by the voters this fall. Greater IC is proud to have coordinated a successful campaign along with many community partners including Think Iowa City. Um and um to see and we're excited to see these funds allocated to important community priorities. I would specifically like to thank you for using the new local option sales tax revenue to not only offset potential property tax increases but also to directly reduce property taxes this year. As you know, the tax rate is only one part of the property tax equation along with the assessed value and the roll back. What percentage of the property value can be taxed? The high property values in Johnson County along with the 90% roll back for commercial property owners uh means that relatively small changes to the tax rate can have significant impacts on local businesses who own their property or who rent from a landlord who will pass the tax increases on. 95% of the businesses in Johnson County are classified as small businesses with fewer than 50 employees and increases to their property taxes can create challenges and force them to make difficult decisions about how to cut expenses elsewhere. We understand that there are many important community priorities that can compete for resources and on behalf of Greater IC, thank you again for a balanced approach to using the new local option sales tax revenue and for reducing property tax rates this year. We hope you will continue to consider the needs of our business community in future years budgets. Thank you very much. Thank you. Would anyone else like to address this topic? Seeing no one in person or online, I'm going to close the public hearing. Could I get a motion to adjourn, which is item number three?

Move. Right. Second. Alter. All in favor say I. I. Any opposed? Motion passes 7 to zero.