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![handle is hein.sag/sagia0003 and id is 1 raw text is: Office of the Attorney General
State of Iowa
*1 Opinion No. 99-6-1(L)
June 1, +1999+
CITIES: Issuing general obligation bonds without public referendum for city park projects; scope of essential
corporate purpose. Iowa Code 6§ 384.24, 384.25, +384.28 (1999)*. Without receiving prior voter approval,
a city could finance the following city park projects with general obligation bonds: (a) the repairing of
baseball, softball, and soccer fields; (b) the repairing and paving of roadways; (c) the maintenance of
swimming pools; (d) the dredging of ponds; (e) the improving of restrooms in and roofs on buildings; (f) the
repairing of plumbing in and roofing of stadiums; and (g) the draining and repairing of trails. (Kempkes to
Chapman, State Representative, 6-1-99) # 99-6- 1(L)
The Honorable Kay Chapman
State Representative
425 2nd St. S.E., ste. 1010
Cedar Rapids, IA
Dear Representative Chapman:
You have requested an opinion on the financing of city park projects, which implicates Iowa Code chapter 384
(+1999).+ That chapter permits a city to issue general obligation bonds -- instruments supported by its
general taxing power -- without a public referendum for any essential corporate purpose and with a public
referendum for any general corporate purpose. See Iowa Code §4 384.25, 384.26, 384.28. See generally
City of Fort Dodge v. Janvrin, 372 N.W.2d 209, 211 (Iowa 1985); Grove v. City of Des Moines, 280 N.W.2d
378, 379-80 (Iowa 1979); Green v. City of Cascade, 231 N.W.2d 882, 885-86 (Iowa 1975).
With regard to city parks, you ask whether essential corporate purpose could include the following seven
projects: (a) the repairing of baseball, softball, and soccer fields; (b) the repairing and paving of roadways;
(c) the maintenance of swimming pools; (d) the dredging of ponds; (e) the improving of restrooms in and
roofs over buildings; (f) the repairing of plumbing in and roofs over stadiums; and (g) the draining and
repairing of trails. If essential corporate purpose does encompass these seven projects, the city may
proceed to issue general obligation bonds without needing prior voter approval in a public referendum.
I.
Chapter 384 is entitled City Finance. Division III of chapter 384 governs issuance of bonds and defines the
phrases city enterprise, essential corporate purpose, and general corporate purpose. See Iowa Code §
384.24(2) -4).
Section 384.24(4) identifies specific projects as general corporate purposes, see Iowa Code § 384.24(4)(a)
-Ig), which also includes [a]ny other purpose which is necessary for the operation of the city or the health
and welfare of its citizens, Iowa Code 5 384.24(4)i). Section 384.26 provides special procedures governing
the issuance of general obligation bonds for a general corporate purpose; they require voter approval in a
public referendum before the city may issue them.
Section 384.24(3) identifies specific projects as essential corporate purposes. For example, such projects
include [t]he opening, widening, extending, grading, and draining of the right-of-way of streets, highways,
avenues, alleys, public grounds, and market places .... Iowa Code 4 384.24(3)(a. Section 384.25 provides
special procedures governing the issuance of general obligation bonds for essential corporate purposes; they
do not require voter approval in a public referendum before the city may issue them.
II.
*2 You have asked whether the seven proposed projects properly fall within the scope of section 384.24(3)
(o) and, as a result, be financed under procedures established by section 384.25.
(A)
The history behind the current language in section 384.24(3)(o) provides a good starting point for analyzing
your question. See generally Iowa Code §4.6(4). We need only look back some twenty years to 1980.
In that year, section 384.24(3)(0) defined essential corporate purpose only as the rehabilitation and](ViewImageLocal?handle=hein.sag/sagia0003&div=1&collection=&method=preview&ext=.png&size=3)