The city of Coralville, due in part to financial obligations associated with TIF incentives for the Iowa River Landing project, is facing a mountain of debt that might be impossible to overcome, a Gazette guest columnist says.
“Coralville offers a classic example of a city headed toward a fiscal cliff,” wrote Douglas Paul of Johnson County, a member of Citizens for Responsible Growth & Taxation, a group of county citizens that advocates open and responsive government. “According to the Iowa Treasurer’s Office, Coralville’s total municipal debt is already $278,895,982. With a population of 19,219, this debt amounts to $14,511 per resident.
“The debt per resident is higher by far in Coralville than in any other city in the state — seven times higher than Iowa City or Des Moines,” Paul continues. “Even Cedar Rapids, after coping with the devastating flood of 2008, carries only $3,366 debt per resident, although there are recent indications that some city leaders are eager to follow Coralville down a financial path of no return.
“As signs of a financial disaster worsen for Coralville, City Hall is working hard to bury the red flags and minimize concerns about the unmanageable debt underlying the city’s many high-risk projects. The city-owned hotel, operated by Marriott Corporation, loses more than a million dollars per year. Like other city-owned properties, these losses are not shown on Marriott’s books because they belong to the taxpayers of Coralville and Johnson County.
“Credit downgrades from Moody’s, an independent rating company, have been dismissed by city officials as irrelevant,” he adds. “These reports will not be so easily dismissed by the lenders who support Coralville’s mountain of debt.”
What do you think? Is Coralville using TIF incentives appropriately on projects such as the Iowa River Landing?