Coralville Council adopts FY2027 budget, raises affordable housing allocation and trims transit levy

Coralville’s City Council on April 28 adopted the Fiscal Year 2027 budget as amended, approving higher spending for affordable housing and adjusting transit funding while preserving a planned new Recreation & Aquatic Center.

Finance Director Ann Hester presented the budget, saying Coralville’s taxable property value rose 4.76% and the state residential rollback decreased to 44.53%, producing an adjusted revenue growth of roughly 2.70%. The proposed city levy increased from $14.53 to $14.85 per $1,000 of taxable value. Hester said General Fund revenues are projected at about $36.5 million and expenditures at about $34.5 million; enterprise funds revenues total about $40.3 million with expenses near $38.7 million. The proposed budget also includes a $1.7 million capital improvement bond for street and park projects and a Recreation and Aquatic Center currently estimated at about $54 million in design phase.

During the public hearing, resident Rex Brandstatter praised the city’s transparency and noted that, due to the rollback change, many residential taxpayers will see a $27.55 decrease per $100,000 of taxable value in city taxes. A local business owner, who identified himself as Scott, urged the council to consider the burden on longtime local businesses and warned that national chains siphon revenue out of the community.

Councilmember Mike Knudson moved to increase the budgeted support for affordable housing from $100,000 to $300,000, proposing the additional funding come from remaining Local Option Sales Tax (LOST) revenues tied to the new LOST approved Nov. 4, 2025; the motion, seconded by Councilmember Hai Huynh, passed. Knudson said the extra funds provide flexibility if the school district declines a pool partnership and to support smaller affordable projects. Huynh argued the city needs more units that cost no more than 50% of a household’s income — and preferably no more than 30% — to be considered affordable. Councilmembers Katie Freeman and Royce Vogelzang supported increasing the allocation but stressed the need to define "affordable housing" at the street level.

The council also debated the city’s transit levy. Staff outlined options to use roughly $2.4 million in available federal 5307 transit funds for eligible capital expenses and explained federal match rules. The council voted to lower the transit levy from the $0.95 maximum to $0.80 (motion by Vogelzang, seconded by Knudson); staff said a smaller levy preserves capacity to extend routes or weekend services in the future.

The budget ordinance (Resolution No. 2026-51) passed on a roll call vote after the amendments. City Administrator Kelly Hayworth and staff noted the budget and supporting documents are posted on the city website and are available at City Hall and the public library.

Key fiscal and program details in the adopted budget include: increases in water rates (first 200 cubic feet for residential from $8.75 to $12.00), a proposal to implement a curbside bulky trash fee aligned with neighboring cities, continued use of LOST proceeds to support recreation center debt service, and reserve-funded capital projects including Well 17 and water-main work projected at about $2.8 million. The council also scheduled a FY2026 budget amendment public hearing for May 26, 2026.

The council declared the resolution adopting the FY2027 budget adopted; next steps include filing the approved budget with the State Auditor and moving forward with project budgeting and bond planning for capital items referenced in the budget.