A stronger, healthier, revitalized community is the goal of this bond.
— Creston Parks & Recreation Department + MPAC Team
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Why a Park and Rec Bond?

The Parks and Recreation Department, along with the MPAC committee, believe that the combination of these two projects will brand McKinley Park, and thus the City of Creston, a destination.  Outdoor recreational opportunities are highly sought and add value to local economies.  The City of Creston Parks & Recreation Department has two major upcoming projects:

McKinley Park Aquatic Center (MPAC)

The McKinley Park Aquatic Center is a $5,432,801 project

McKinley Lake restoration Project

The McKinley Lake is a $3,956,100 project

The McKinley Lake Restoration Project essentially ‘resets’ the clock for the lake by removing 100 years of sediment accumulation.  The project will improve and protect the lake for recreational use and enjoyment by current and future generations.  The restoration project envisions construction of fishing jetties and/or docks, stabilization of eroded banks, near-shore deepening, a new beach, and increase water sports on the lake.  People travel to other towns because of sporting events, recreation opportunities, unique shopping opportunities, and services, restaurants, businesses and amenities they don’t have in their own hometown.  McKinley Park is positioned, through the McKinley Lake Restoration Project and the MPAC, to provide that unique experience to the region.  It will spur new visitors to the community.  New visitors bring more revenue for local stores, restaurants, hotels, and all local businesses.  More money spent in Creston means a stronger economy, which leads to more jobs and more sales tax revenue for the City.  If businesses grow, and new businesses pop-up in the community, that creates a larger property tax base.  A larger property tax base and additional sales tax revenue means more revenue for the City.  If the City has more income, there are more funds available to fix those roads, and offer better services and amenities to its citizens.  The City is a business, just like any other.  It has to increase its revenue stream to be able to offer the services we expect as citizens.  By making McKinley Park a destination through completion of MPAC and the Lake Restoration projects – we create more revenue for the City, and the citizens of the community.  That benefits everyone, whether or not you plan to utilize MPAC or McKinley Park or McKinley Lake.  A stronger, healthier, revitalized community is the goal of this bond.

 

A bond provides a way for the City to develop these needed improvements.  The bond, if approved, will allow the City to fund a significant portion of each project.  The bond funds will also be utilized to match available grants and private donations to fund the remaining portion of each project.

 

What is a bond and how much will it cost? 

To pay for large capital (construction) projects, cities sell bonds and use the money to pay for the projects. Bonds are sold to investors, also known as bondholders, who are looking for a stable return in the future on the money they invest today. The City promises to repay the bondholders, with interest, over a specific time period, in this case 10 years.  The bond repayment is funded through property taxes the City receives. Bonds are just one way to pay for capital projects. Cities also use other forms of taxes, such as sales taxes, or other types of fees, such as water service fees, to pay for large construction projects. Bond programs must be approved by voters. 

 

The Parks and Recreation Department and MPAC are asking the citizens of Creston to approve the issuance of general obligations bonds, of which $2 million would to be used for MPAC and $2 million would be used for the McKinley Lake Restoration Project.

 

Why does the City issue bonds rather than pay for the projects with cash?

The bond program includes two large-scale projects.  Current funding for capital projects in the City’s operating budget is very limited, compared to the number and costs of capital requests.  Using bond financing to fund these large projects allows the annual City operating budget to be allocated toward annual and ongoing costs, such as maintenance, personnel, operations and public service programs.  City operating costs are used to operate and maintain the lake, the park and the pool.

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Will this bond raise my taxes?!

Each Proposed Bond is a ten-year, $2 million program. Each bond would be repaid by increasing the City of Creston’s property tax rate by $1.00 per $1,000 of valuation.  Please utilize the property tax calculator via this google sheets spreadsheet to determine the impact to your annual property tax.

Residential Property

This is what a $1.00 per $1,000 looks like: 

Let’s say your home is assessed at $100,000. 

 Assessed value:  $100,000

 In Iowa, we have what is called a ‘ Residential Rollback,’

which means for the current fiscal year, only 56.918% of 

the assessed value of your home is taxable.    

      

Calculating Taxable Value: $100,000 x 56.918% = $56,918

 

So, for a $100,000 home, your Taxable Value is:   $56,918

 

If you divide your Taxable Value by $1,000:                  

$56,918 / $1,000 = $56.918

which is then multiplied by the Levy Rate of:  $1.00

$56.918 x $1.00 = $56.92

to get an annual increase in your Real estate taxes of:    $56.92

or around $4.74 per month.

Commercial Property

The “Commercial Rollback” is 90%.

Let’s say your business is assessed at $100,000. 

 Assessed value:  $100,000

 

Similar to Residential only a portion of the assessed value of commercial property is taxed. The ‘ Commercial Rollback,’ for the current fiscal year taxes only 90% of  the assessed value of your commercial property.  

Calculating Taxable Value:  $100,000  x 90.00% = $90,000

So, for a $100,000 commercial property, your Taxable Value is:  $90,000

If you divide your Taxable Value by $1,000:      

$90,000 / $1,000 = $90.00

 

which is then multiplied by the Levy Rate of:  $1.00

$90.00 X $1.00 = $90.00

to get an annual increase in your Real estate taxes of:    $90.00

or around $7.50 per month.

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Commercial Bond Illustration 2M.jpg

**The illustrations shown above estimate increase in annual tax payment based on a $2 million bond issue amount using a 3.5% interest rate for a 10-year note.  These rates are subject to change and the illustrations shown are estimates.

 

Where can I find more information about the City’s budget and finances?

 The City’s budget be found on the Iowa Department of Management's Website

 

When will these projects be constructed?

Each bond program is intended to last for ten years. If the bond program is approved by voters, the City anticipates selling the bonds as early as 2020.  The funds from the sale of the bonds will be used to match grants and complete funding for the MPAC and the McKinley Lake Restoration Project.

If the proposed bond issues pass, MPAC will have secured over $3.8 million in funds for the project through fundraising efforts, corporate pledges, the Dekko Foundation grant and miscellaneous grants received.  MPAC will be able to utilize the bond funds to apply for additional major grants and secure private funding for the remaining funds to complete the project.  It is MPAC’s hope that the project will have enough funds secured to begin bidding the project in 2020 and hope to swim in 2021. 

The McKinley Lake Restoration Project will utilize the bond funds to capitalize on available DNR and other grant funds available for this type of project.  As soon as all of the funds are in place, the project will be put out to bid and a construction timetable will be set.  We are hopeful that the construction of this project will coincide with the construction of the MPAC and both projects will be completed over the next two to three years. 

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How will I know if these projects are being completed and the bond funds are being used properly?

The MPAC committee and the Parks and Recreation Department are committed to provide all updates, timelines, and expenditures related to these projects.  It is important that the citizens can see where their tax dollars are being utilized. 

MPAC and the Parks and Recreation Department are committed to transparency for use of the public funds so that everyone will be able to see how the bond funds are benefiting the community.

The total MPAC project cost of $5.4 million includes a $1 million endowment fund.  The income generated from the endowment fund will be used for future major repairs and upgrades for the facility so that it will remain on the cutting edge of aquatic design for generations to come.  It is MPAC’s vision that by including an endowment of this size as part of the project, the aquatic center will be self-sustaining, and the City’s only future expenditures for the pool will be the operating costs which are already included the City’s budget.

How do I vote YES! for these projects?

The City Council has approved a request by the Park and Recreation Department and MPAC to include the issues on the ballot during the general election to be held on November 5, 2019.  To vote in favor of these projects, please check Yes on your ballot for EACH of the following questions:

 
 
  1. “Shall the City of Creston, Iowa, enter into a loan agreement and issue its general obligation capital loan notes in an amount not to exceed $2,000,000 for the purpose of the construction, enlargement, improvement and equipping of an aquatic center?”

  2. “Shall the City of Creston, Iowa enter into a loan agreement and issue its general obligation capital loan notes in an amount not to exceed $2,000,000 for the purpose of dredging, improvement and related restoration of McKinley Lake?”