The Clinton Herald, Clinton, Iowa

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November 27, 2012

Clinton has $87 million debt, state report says

DES MOINES — The city of Clinton ended last fiscal year with more than $87 million in outstanding debt, a new report from the Iowa Treasurer’s Office shows.

The amount is down from the $91.6 million in debt the city had at the end of fiscal year 2011, but sewer revenue bonds and the looming $100 million in projects for the long-term control plan will affect the city’s debt over the next few decades.  

As a whole, Iowa’s debt is $14.4 billion, 35 percent of which is created by cities, according to the outstanding obligation report issued by the state Treasurer’s office Monday.

Clinton, which accounts for roughly 50 percent of Clinton County’s population, made up 75 percent of the $115 million in debt generated by the municipalities within the County.  

Sewer revenue bonds accounted for $70.9 million of Clinton’s debt in fiscal year 2012. These bonds are to be paid by the revenue from sewer users; however, the city has been experiencing a serious cash flow problem with these funds.  

The remaining portion of the city’s debt consists mainly of general obligation bonds. That portion, City Finance Director Jessica Kinser said, is at a comfortable level. But the pending $20 million in general obligation bonds the city plans to take out in order to pay for the first three years of projects for the long- term control plan could push the city to a more distressed disposition at 73 percent of its debt capacity.  

“Those general obligation bonds that gets us to the capacity where we start to get a little uncomfortable,” Kinser said.  

Also on the city’s obligation list for fiscal year 2012 were the $4.5 million EMS settlement, grant repayment and lease of the police facility.  

Comparing the debt of cities with comparable populations to Clinton, Fort Dodge was the closest with $75 million in debt. Following was Burlington with $62.6 million in debt, Muscatine with $35 million, Marshalltown with $31 million, and Ottumwa with $28 million in debt.  

Coralville topped the list of cities across the state with $279 million in debt at the end of fiscal year 2012.  

The report also details the debt from school districts, which accounts for 21 percent of the state’s overall debt.  

The Clinton School District had $32.6 million in debt at the end of fiscal 2012, down from $33.9 million at the end of fiscal year 2011.

“I think this district is very well balanced,” District CFO Jan Culbertson said. “This district has not overused its opportunities.”

In total, Clinton County, its cities and school districts had $195.5 million in debt at the end of last fiscal year.

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