'Diddly squat' and the big picture

By The Gazette Editorial Board

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Cedar Rapids Mayor Ron Corbett is taking some heat for a statement made about paying for two of the city's major flood-recovery building projects. Regarding the Paramount Theatre restoration/expansion and the new central fire station: “Local taxpayers won't pay diddly squat for those two projects,” he said at last week's City Council meeting.

Yes, dollars from property taxes or other local sources are not expected to be needed for those projects. State and federal funding sources have been negotiated.

Critics, though, rightly remind that Cedar Rapids residents pay taxes to their state and federal governments, too.

Yet in the larger picture of funding for several large projects, the mayor and City Manager Jeff Pomeranz make an important point: A relatively modest amount of local tax money has leveraged much larger amounts from state and federal sources.

Whether you agree or not with the scope or even the necessity of all of these projects tied to flood recovery and economic growth, they wouldn't be happening, at least any time soon, without “outside” funding. And the accompanying state and federal money wouldn't be available unless used for the targeted projects.

One reason Cedar Rapids has been successful in landing such financing assistance lies in the city's track record for managing its finances and maintaining its diverse economic/job engine - even after the unprecedented flood of 2008.

The worldwide Moody's Investors Service again put its shiniest stamp of confidence on Cedar Rapids in May, bestowing its best bond rating - Aaa - on our local government for the 38th consecutive year. Only a handful of other Iowa cities, including Iowa City, have the Aaa rating. Any downgrade can cost a government entity a lot of extra interest costs - for which taxpayers are liable.

Pomeranz assures that the city's overall financial position is “very strong” while acknowledging that many challenges lie ahead. Residents' No. 1 complaint is the growing backlog of bad streets. Pomeranz told us the problem will get top-priority attention in next year's city budget.

Good to hear, but we wonder where a fix will come from. Cuts or more efficiencies elsewhere? Higher property taxes?

Actually, about 60 percent of the city streets budget comes from state road use fund, which can't offer much help without adjusting the stagnant fuel tax or the distribution formula. Leveraging such changes from state lawmakers and the governor will be a challenge on a par with the number of streets in need of major repair.

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