Podcast

On this edition of Iowa Press, Brad Hart, mayor of Cedar Rapids, and Paula Dierenfeld, mayor of Johnston, discuss impacts of the 2021 Legislative session on local government, as well as a variety of other issues affecting Iowa cities.

Joining moderator David Yepsen at the Iowa Press table are Kay Henderson, news director for Radio Iowa, and Erin Murphy, Des Moines bureau chief for Lee Enterprises. 

Program support provided by: Associated General Contractors of Iowa, Iowa Bankers Association and FUELIowa.

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Iowa's local communities balance the rules and regulations of both federal and state governments, all while navigating a pandemic. We check in with a pair of Iowa mayors on this edition of Iowa Press.

Funding for Iowa Press was provided by Friends, the Iowa PBS Foundation. The Associated General Contractors of Iowa, the public's partner in building Iowa's highway, bridge and municipal utility infrastructure. Iowa PBS is supported in part by Wells Fargo. Fuel Iowa is a voice and a resource for Iowa's fuel industry. Our members offer a diverse range of products including fuel, grocery and convenience items. They help keep Iowans on the move in rural and urban communities. Together we Fuel Iowa. Small businesses are the backbone of Iowa's communities and they are backed by Iowa banks. With advice, loans and financial services, banks across Iowa are committed to showing small businesses the way to a stronger tomorrow. Learn more at IowaBankers.com.

For decades Iowa Press has brought you politicians and newsmakers from across Iowa and beyond. Celebrating nearly 50 years of broadcast excellence on statewide Iowa PBS, this is the Friday, June 4 edition of Iowa Press. Here is David Yepsen.

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Yepsen: Iowa's local cities and towns have long balanced the rules and regulations of federal and state lawmakers, all while dealing with the realities of municipal government like potholes, property taxes and economic development. We've gathered a pair of Iowa mayors to discuss the issues confronting our local communities. Paula Dierenfeld is Mayor of Johnston, a suburb located north of Des Moines and Brad Hart is Mayor of Cedar Rapids. Welcome to you both. Thank you for being with us.

Dierenfeld: Absolutely, great to be here.

Hart: Thank you.

Yepsen: Joining our conversation across the table is Erin Murphy, Des Moines Bureau Chief for Lee Enterprises and Kay Henderson is News Director at Radio Iowa.

Henderson: Madam Mayor, tell us about Johnston and what its latest census figure may be and how that compares maybe to the past decade.

Dierenfeld: Absolutely. Well, we haven't received the final census numbers yet, but we anticipate that we'll see another substantial growth in Johnston. I think that what they have already said is that we are the fifth fastest growing community in the state. And we have been in the top 5 for many years now just in terms of our growth rate. So, we're growing, people are moving here, they love Johnston, they love what Johnston has to offer and businesses are locating here. So we expect that growth to continue into the future.

Henderson: Mayor Hart, what is the picture in terms of population in Cedar Rapids? You've had some disruptions over the past two decades. How has the population stabilized, gone down, gone up?

Hart: It has stabilized. We're about 135,000 people and that has been 130,000 to 135,000 for the last probably 10 years. After the '08 flood we lost some population. But it has been growing since. And housing is certainly part of it but a lot of it has been industry, manufacturing. We've, in the last 3 years we have issued more than a billion dollars in building permits in Cedar Rapids, Iowa.

Murphy: Mayor Dierenfeld, do you expect that growth to continue in the coming years looking ahead?

Dierenfeld: I expect that growth to continue. We believe that about 25,000 people currently live in Johnston and we expect that in the next 10, 15 years that will be 35,000 to 40,000. Now, we are limited by our opportunity to grow because we are one of the suburb communities in the metro area and pretty soon we bump into other communities in the metro area. But there is opportunity out northwest to continue to annex some land that is currently in the county and to develop it for both residential as well as commercial growth.

Murphy: Mayor Hart, how about the Cedar Rapids area? Are the suburbs growing there? What do you expect it to look like in the future?

Hart: Marion and Hiawatha are both growing but so is Cedar Rapids and we are now going to the south end of town. A college community, one of our school districts just broke ground for another school down there and we just approved plans for two large housing development projects on the south side of Cedar Rapids and also the Highway 100 extension that we tried to get for about 40 years went in a couple of years ago and that is also allowing for growth in the northeast quadrant of Cedar Rapids.

Murphy: So this suburban growth isn't a unique phenomenon to Iowa, it is happening all over the country. One of the things I wanted to ask you both about, do you have any concern -- Mayor Dierenfeld, we'll start with you -- that this growth in the suburban area is coming at a cost in our rural communities that are having trouble keeping people, our smaller towns in Iowa? Is it a migration that is hurting those smaller towns?

Dierenfeld: I definitely think that that is happening. I grew up in a small town in Iowa, in northwest Iowa, Sac City. And as their population continues to decline our population continues to grow in Iowa. So I think we are attracting people from small towns in Iowa and in fact our surveys show that. When we survey our residents and ask them where are you coming from they will say small town Iowa.

Murphy: Mayor Hart?

Hart: I yes, absolutely I'm sure that it has, a lot of our new residents are coming from rural communities because the bigger cities just tend to have more opportunity. And the cities are working really hard at creating amenities where people want to come and live and trails and river recreation and of course we're already the shopping mecca for all of the 5 counties around us. So people are used to coming in, so it's not like a strange big city, they can't ever imagine being there. So they have been there as a kid and then they maybe get out of high school or out of college and they say, I know Cedar Rapids, I'm going to come to Cedar Rapids.

Henderson: Regardless of where you live in Iowa the price of buying a house has really gone up during the pandemic. Paula Dierenfeld, will that mean that if I live in a city like yours my property tax bill is going to go through the roof as well?

Dierenfeld: No. The simple answer is no. You're absolutely right, construction costs have gone up considerably and we're going to see that a little bit in terms of the permits that are pulled for housing as well as some commercial. But at the same time we expect that the taxable valuation will increase and as that taxable valuation increases that obviously provides more revenue to our cities. So we work very hard to keep our property taxes as low as possible in Johnston and we'll continue to do that.

Henderson: What is the housing situation in Cedar Rapids where you had housing lost because of the derecho and this added idea that it was already hard to buy a house?

Hart: That is why there are several new developments for new housing, single family and multi-family. It is because of that housing shortage. After the derecho there were 6,000 homes or businesses that were damaged, some destroyed. So the housing has been harder to build new housing because people are still trying to have their homes repaired, the contractors are all busy repairing existing homes. But these new developments, as I mentioned on the south end of town, are going to be really helpful and should be, some of them are certainly designed to be affordable housing and workforce housing. So we're really trying to incent different types of housing development in our community and also do in-fill. We are trying to get people to fill in where we already have services and sewer and utilities versus spreading way out to our outskirts.

Henderson: Paula Dierenfeld, the legislature passed housing credits to spur development of multi-family, some people call them apartments. Is that going to work in places like Johnston or do you have the wherewithal to use those credits?

Dierenfeld: Well, I think that will probably encourage developers to look at Johnston in terms of multi-family residential. We've seen over the past several years that there is a demand for all kinds of housing in Johnston whether it's single family residential or multi-family residential. So housing growth in our community has really not been a problem.

Murphy: Mayor Dierenfeld, you mentioned the property taxes earlier. A few years back the state enacted some property tax reductions and they pledged to fulfill those losses to local communities over a number of years. This year they voted to phase out those payments to local communities. How is Johnston going to be able to handle that loss of the backfill coming from the state?

Dierenfeld: Well, probably the thing that was most impactful that the legislature did this year was to eliminate the backfill. Now, they have done it different ways for different communities depending on what their taxable valuation growth is. In Johnston our growth has been great enough that that will be phased in over 5 years. What we're currently receiving in backfill is about $440,000 a year. So we're going to have to make some tough decisions on how we're going to address that. You think $440,000, that's four police officers in the city of Johnston. I think we'll be able to work our way through it. As I said, we continue to grow in Johnston both on the residential side as well as on the commercial side and our growth rate is about 8% taxable valuation per year. So I think we'll be able, over that phased period, we'll be able to work through it. That's not to say that it's going to be easy, but I think we'll be able to address it.

Murphy: Mayor Hart, what does the loss of that backfill mean to Cedar Rapids?

Hart: $4 million a year and it will be phased in so if we're at the 5 year or the 6 year it's $700,000 a year each year reduction until it's gone, or $800,000 each year until it's gone. While $4 million is not a large part of our overall budget, it's $4 million. So a lot of good things happen with $4 million. So we'll have to do the same as Johnston, we'll have to figure out how to provide those services without that revenue that we were receiving.

Yepsen: Mayor Hart, the state of Iowa is seeing an increase in its revenues, income tax and sales tax, during the pandemic. You don't have income taxes in Cedar Rapids. But what is the situation there with your tax revenues during the pandemic?

Hart: Sales tax revenues surprisingly went up, there's always a silver lining, after the derecho the last quarter of last year sales, our sales tax revenue went up dramatically because people were buying, having to replace all these, their furniture, they were buying all of these construction materials, we had even our hotel/motel revenues went back up because we were housing thousands of linemen from all over the country to repair things. Our overall property tax revenues only went up about 1% or 2% last year, which is the lowest it has in a number of years. And some of that was impacted, again, by the value of the homes and the homes that were damaged. So that was low. We usually are about 4%, 4.5%. But with all the new construction and, as I mentioned, all the building permits we are growing our tax base and that is certainly helpful.

Yepsen: Mayor Dierenfeld, what has the pandemic done to your tax revenues?

Dierenfeld: Well, our primary revenue source is property tax and so that was largely unaffected by the pandemic. In fact, we had an increase of about $6 million in taxable valuation last year even with the pandemic. So that was a positive for us. The other, probably the other revenue source that we have is hotel/motel. We don't have a lot of hotels in Johnston. But we did see some decline in that obviously.

Yepsen: And stimulus money from the federal government, will you be getting any of that?

Dierenfeld: This latest round, the ARP funds, we are expecting to get about $3.5 million with that.

Yepsen: Any ideas what you're going to do with it?

Dierenfeld: Well, the treasury hasn't come out with our final rules yet, so we're still waiting for that guidance. But one of the things that has been suggested that we could spend that money on is things like sewer, water, storm water infrastructure. And certainly in a growing community and even as you have older parts of your community there is always demand for putting in new pipes for water and sewer.

Yepsen: Mayor Hart, same question to you. What is the stimulus money going to be like for Cedar Rapids?

Hart: We expect about $28 million. We hope to get half of it next week and then the other half in about a year. We're also still studying the guidelines and the rules, the final rules aren't out. Certainly one of the issues, we lost in revenue $15 to $20 million in revenue from the pandemic. So we're looking at one of the ideas you can use the money for is to replenish your lost revenues for cities and communities. So we're looking at those rules. We're also working on the social side of it and people who are really impacted working with our county to develop an overflow, a permanent overflow shelter for the homeless. And we're going to use some of it to help people finish repairing their homes. We're working hard to figure out where the gap is for people who are uninsured or underinsured and so we can figure out ways to provide money and services for them and also small business and non-profits, we're going to help them too.

Yepsen: Mayor Hart, my experience in covering government in Iowa for a long time has been when windfalls occur or grants or things, a lot of money starts sloshing around, there is opportunity for fraud or just plain misspending. Are there controls in place to prevent that from happening in your city?

Hart: Yeah, absolutely. We are very strong financially. We have an AA bond rating. The only reason we don't have an AAA bond rating is because we own a hotel. And we win awards every year for our budgeting process. So it is all very transparent, the public can see all of those numbers. So I have no fear of that.

Yepsen: Mayor Dierenfeld, same question. But are you concerned, do you share that concern? Is this going to be a problem in Iowa, maybe not with yours, but with other communities? A lot of money pouring in, it has to be spent quickly.

Dierenfeld: Well, it's hard for me to speak for other communities. I agree with Mayor Hart here that if you have the right financial processes in place and if you have good people working for you, and we have a very good finance director in Johnston, you prevent to the extent that you can those concerns ever happening. We would certainly encourage all other communities to put those same procedures in place, make sure that they have the best people in those positions that they can have in those positions, because the fact of the matter is they probably will be audited either by the federal government or by our state auditor. So they need to be paying attention to what the rules are.

Henderson: You didn't deal with the derecho that Mayor Hart dealt with, but Mayor Dierenfeld, you have dealt with flooding. What in your view needs to happen at the state level to assist counties and cities to be better prepared for these type of cataclysmic events?

Dierenfeld: Yeah, well we did experience the derecho last summer. In fact, we had not only the derecho but we had straight-line winds and we had a tornado that I think went right over this building of the public broadcasting system. So we had three major weather events in less than two months last year. I think that the state government can always give us guidance on how to address those situations and perhaps provide some funding. But I think the responsibility for that really lies at the local level. We had these three major events last year and immediately our public works were out and they were clearing streets, they were cutting trees down, neighbors were helping neighbors. So I think that as communities, as leaders in our communities, we have a responsibility to prepare for those things happening in advance and make sure that we're able to respond to them.

Henderson: Mayor Hart, Cedar Rapids condemned properties after the big flood. Now you're dealing with the derecho. Are there ways in which you had expected the state to step forward in the past legislative session to assist Cedar Rapids?

Hart: The legislature did step up in one way when we made an ask to help us reforest our city. We estimate that we lost 65% of our tree canopy in Cedar Rapids. And so through the Build Iowa program I think they allocated $250,000, which is a start and we'll probably, it's going to take a decade or more to replenish all of our trees and we'll keep asking. So they did help in that way. The disaster, because it was a presidential disaster declaration, because it was part of that, FEMA was in and the Iowa Guard came and helped. So I really don't think that we were missing anything from the state to handle the derecho and really from the legislature. We didn't have a big ask because we're pretty resilient and handled a lot of the stuff ourselves.

Yepsen: Mayor Hart, I want to ask you about this preparedness issue. You had a huge flood a decade ago, you had this derecho, you mentioned, Mayor Dierenfeld, the traumas that Cedar Rapids has faced. To a lot of people this is an example of the climate emergency, climate change. We're going to have weather extremes. What do you do, Mayor Hart, to be prepared for that?

Hart: Well, we have disaster preparations for tornadoes. I'm not sure we had one for a derecho. But so many of the other processes.

Yepsen: So what lessons did you learn and going forward what are you going to do differently?

Hart: We've got to figure out, the communication was the biggest issue because there was no power and the cell towers were knocked out. So we're working with Alliant and MidAmerican to bury lines now more so than they ever did before. We have hired an outside consultant to look at how we responded. And we'll look at that study and say, what could we have done differently? What should we have done differently so we can make sure that we're as prepared as possible? But we had 10 minutes warning and no one, the winds were not 100 to 140 miles an hour until they got to Cedar Rapids.

Yepsen: Mayor Dierenfeld, the preparedness issue, what did you learn? What are you doing differently for next time?

Dierenfeld: Well, Kay mentioned the flooding situation and we've experienced flooding in Johnston, we have a lot of water in Johnston. We have the Des Moines River, we have Beaver Creek, we have Saylorville Dam. We sit right at the foot of Saylorville Dam. If something catastrophic happened with Saylorville Dam, I mean, half of Johnston would be gone. So the first thing you do is you just plan for those kinds of events and make sure that your emergency responders, your police, your fire and your public works are all prepared to respond, they are trained and they are prepared to respond to those things. But in particular on the flooding situation, one of the things that we learned there, we have this staff person at City Hall that does amazing things with GIS and he can predict things that are going to happen. And so he has done a, he did a nice job during the last flooding situation that we had monitoring the water levels and letting us know what was going to happen when and we could prepare for that. We could put sandbags up to make sure that that flooding didn't happen.

Yepsen: Just a few minutes left, Erin.

Murphy: For those of us who cover the legislature we often hear the phrase local control tossed around a lot and when state lawmakers are considering policies that may impact cities and counties. Mayor Hart, we'll start with you on this one. Do you feel that the current state legislature has local control, has city leaders and county leaders in mind when they're passing some of these changes? One example that was recent was a requirement that cities and counties can't have a face mask requirement that exceeds whatever is at the current policy at the state level. Did that tie the hands of cities and counties in your mind?

Hart: Absolutely, it did. That seems to me the essence of local control. Ever since the pandemic started I was meeting almost every day with our local medical professionals and they were panicked. They were completely panicked and said we have to have masks, we have to wear masks. And so the cases went down a little bit in the summer and then they started to spike again last July and August and so I issued a mask mandate in September and we didn't enforce it, we educated people, but a lot more people wore masks and our numbers went down. So that, even the CDC Director says that these are local issues. One county, what happens in rural Iowa is pretty different than what happens in Des Moines and Johnston and Cedar Rapids. People are together, they are working next to each other. And so I understand the difficulty of having a statewide mask mandate, but I would have preferred that we had and could continue to have the ability to issue it locally.

Murphy: Mayor Dierenfeld, that is just one example. More broadly do you feel like the state legislature has local officials' ability to set their own policies in mind?

Dierenfeld: Sometimes the legislature disappoints me on some of the policy that they put in place. We have many legislators who do have that city government background and some of them carry that to the legislature and others who may have either forgotten it or just they didn't carry that philosophy with them. As Mayor Hart said, sometimes they try to fix a problem with one size fits all and that just doesn't work in Iowa. We have metropolitan areas, we have suburbs, we have rural areas and that one size fits all just doesn't work. In the instance of the mask mandate, in Johnston we put a requirement in place that if you come into our public buildings you have to wear a mask. We encouraged our businesses to put protocols in place and if they felt it was appropriate for them to require a mask then they could do that. So, what the legislature just passed isn't really going to impact the way we approach that particular issue.

Yepsen: Just a few seconds left, Mayor Dierenfeld. Whatever happened -- you're a republican, both of you are republicans, it's a non-partisan job. But whatever happened to local control in the Republican Party? Aren't they for it anymore?

Dierenfeld: Well, I would like to say yes, absolutely.

Yepsen: But there are exceptions.

Dierenfeld: There are.

Hart: Yeah, absolutely there are exceptions. But it does seem to be, the legislature does seem to be whittling away at it if not taking a big chop at it sometimes. But we'll keep working at that and still keep pushing for local control.

Yepsen: And I have to interrupt because the clock is whittling away at our time. Thanks to both of you for being with us.

Dierenfeld: Absolutely, thank you, appreciate it.

Hart: Thank you.

Yepsen: And we'll be back next week with another edition of Iowa Press at our regular times, 7:30 Friday night and Noon on Sunday. For all of us here at Iowa PBS, I'm David Yepsen. Thanks for joining us today.

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Funding for Iowa Press was provided by Friends, the Iowa PBS Foundation. The Associated General Contractors of Iowa, the public's partner in building Iowa's highway, bridge and municipal utility infrastructure. Iowa PBS is supported in part by Wells Fargo. Fuel Iowa is a voice and a resource for Iowa's fuel industry. Our members offer a diverse range of products including fuel, grocery and convenience items. They help keep Iowans on the move in rural and urban communities. Together we Fuel Iowa. Small businesses are the backbone of Iowa's communities and they are backed by Iowa banks. With advice, loans and financial services, banks across Iowa are committed to showing small businesses the way to a stronger tomorrow. Learn more at IowaBankers.com.

Iowa Bankers Association
Associated General Contractors of Iowa