Iowa City releases proposed $2025–2029 Capital Improvements Plan; debt levy and large projects spotlighted

Iowa City staff presented the proposed 2025–2029 Capital Improvements Plan at a Jan. 22 work session, outlining $100s of millions in street, water, transit, parks and facilities projects and warning that rising construction costs and limited debt capacity will force trade-offs in coming years.

The CIP presentation, led by Ron Kinaki, Public Works Director, covered the plan development timeline, major categories of projects, and funding sources. Jacqueline Fliegel, Assistant Finance Director, said the city is planning a FY25 bond issue of $14,290,000 and that the current plan assumes average annual bond issuances of about $15,250,000; with current levy assumptions and growth projections the debt levy can support about $14,600,000 annually. "What we're planning to bond for this year, to start off, is $14,290,000," Fliegel said.

Why it matters: The CIP lists 104 projects in a five-year program, and staff said the most exposed items — large street reconstructions, a proposed transit maintenance facility, the City Park Pool and several water and wastewater upgrades — depend on a mix of GO bonds, federal grants, reserves and other sources. If growth and interest-rate assumptions fall short, the city will have to raise the debt levy further, scale back projects or delay them.

Major categories and flagship projects

- Streets and transportation: Streets are the largest category (about 33.6% of budgeted CIP expenses cited in the presentation). Notable projects called out included Dodge Street reconstruction ($20.1 million), Taft Avenue reconstruction ($12.2 million) and annual pavement rehabilitation ($11.9 million). The presentation also listed planned two-way conversions for Market and Jefferson streets, the Court Street reconstruction (Muscatine Avenue through First Avenue) and coordination with the Iowa DOT on Dodge Street.

- Transit: Transportation staff described a planned transit maintenance facility, estimated at roughly $21.4 million for the building plus about $12 million for equipment and supporting infrastructure; Darien Nagelgamm, Director of Transportation Services, said the facility was "heavily supported with a federal grant of over $18,000,000." The CIP also funds a bus-stop assessment and phased bus-stop improvements.

- Water and wastewater: Staff highlighted several water projects, including an East elevated storage proposal ($7.5 million cited for one elevated tank), Bradford Drive water-main replacement (slated this summer) and a program of pump and treatment upgrades. Wastewater projects listed included digester rehabilitation and a renewable natural gas upgrade to clean digester gas for pipeline injection.

- Parks and recreation and civic facilities: The City Park Pool project (described as a three-pool concept) and related park shelter and restroom reconfigurations were described as near-term priorities; Parks Director Julie Bridal Johnson said, "It is the 3 pool concept. We do we plan to set the public hearing at the first council meeting in February and take bids later February, with the bid date in mid March." Other parks work includes trail segments, playground replacements, and major repairs to aging trails and bridges.

- Airport and public safety: Airport Manager Mike Tharp described FAA- and state-grant-dependent projects including apron expansion and runway pavement repairs; Tharp noted the airport typically receives 70–90% grant participation on eligible projects. Fire staff outlined planned ladder-truck replacement, station repairs and a shelved Station 5 replacement pending funding; staff said Station 1 and Station 3 needs remain under evaluation and may require a referendum if facility reserve funds are insufficient.

Funding picture and constraints

Fliegel summarized major funding sources: general obligation (GO) bond proceeds, federal grants (the presentation cited roughly $47.8 million of federal grant projects in the CIP, with the transit facility cited at about $18.2 million and an airport terminal project listed at $7.3 million but not yet secured), the facility replacement reserve (listed at about $31.2 million in plan figures), and targeted annual program accounts. She noted assumptions baked into the debt capacity estimate: a taxable value growth assumption (2% for two years then 3% thereafter in the presentation) and a 5% effective interest rate. She warned that if those assumptions underperform, the city must “raise the debt levy, scale back the scope of projects, or delay or remove projects.”

Council questions and staff directions

Council members pressed staff on several implementation details, including whether funds for undergrounding utilities come from a dedicated undergrounding account or are charged to project accounts (staff said the undergrounding account supplements project-specific funds and that some undergrounding costs are moved into individual project accounts). Council and staff discussed potential revenue or lease opportunities from joint utility trench (DUC) conduits; staff said utilities that use the conduits immediately would reimburse their share and the city typically installs extra capacity for future use.

Staff also flagged project dependencies: several items are grant-dependent (FAA, Iowa DOT, Land and Water Conservation Fund/National Park Service, Safe Streets for All) and some projects (fire stations) lack both funding and, in one case, identified land. Fire station replacements were described as likely requiring additional public borrowing authority or a referendum.

Notable near-term actions and timeline items

- The City Park Pool final plans were reported as imminent; Parks staff said a public hearing is planned for the first council meeting in February, with bid solicitation in mid-March.

- The transit maintenance facility design and federal-clearance processes are underway.

- Court Street reconstruction and several other street projects were scheduled to start design or construction within the next 12–30 months; staff estimated Court Street work could last more than two years.

What the presentation did not change

No formal council votes or ordinance adoptions occurred during the work session; the meeting was a staff presentation and discussion of the proposed CIP and associated funding assumptions. Several council members suggested additional studies and emphasized priorities — pedestrian safety on Burlington and along Keokuk, electrification of HVAC projects where practicable, and an integrated river/riverfront planning discussion with the University of Iowa — but the session recorded no formal new policy actions.

Ending

Staff asked council to note the resource constraints and the potential need to prioritize or sequence projects, and to expect continued CIP and budget discussions through March. Staff emphasized that inflation, supply-chain delays and labor/equipment availability are already stretching schedules and costs; Fliegel repeated the central fiscal point, that projected debt capacity and growth assumptions will shape how much of the proposed work the city can finance in the near term.

Quotes in this article are drawn from the Jan. 22, 2025 Iowa City Council work session presentation and discussion.