HomeMy WebLinkAboutA004 - Legal Opinion dated April 9, 1999 - 9
i APR 12
- CITY OF AMES,IOWA Memo
City Attorney's Office
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TO: Ted Tedesco, Mayor
FROM: John R. Klaus, City Attorney*,
DATE: April 9, 1999
SUBJECT: Hotel/Motel Tax, Support of ISU Center Improvements
This is in response to your request of April 8, 1999 for Sections of the Code of Iowa that support the
legality of expending city hotel/motel tax revenue in support of improvements to Hilton Coliseum.
Section 422A.2(4)(a), Code of Iowa, provides that hotel/motel tax proceeds can be lawfully
expended by a city for:
"... constructing, improving, enlarging, equipping, repairing ... recreation,
convention, cultural, or entertainment facilities ...".
The Iowa Code does not say that the City must be the owner of those facilities.
Section 28E.4, Code of Iowa, states:
"Any public agency of this state may enter into an agreement with one or more
public or private agencies for joint or cooperative action ..."
Section 28E.5, Code of Iowa, states:
"Any such agreement shall specify the following:
xxx
4. The manner of financing the joint or cooperative undertaking, and of establishing and
maintaining a budget therefore.
The agreement between the City and Iowa State University is for such "cooperative action". Its
terms state the manner of financing and define the project budget.
Section 384.24(4)(h) defines as among those things that are a general corporate purpose of a city:
"The undertaking of any project jointly or in cooperation with any other
governmental body which, if undertaken by the City alone, would be for a general
corporate purpose."
Section 384.24(4)(a) defines as among those things that are a general corporate purpose of a city:
"The acquisition, construction, reconstruction, extension, improvement, and
equipping of... city enterprises ..."
Section 384.24(2)(b) defines City enterprise to include:
"Civic centers or civic center systems, which may include auditoriums, music halls,
theaters, sports arenas, armories, exhibition halls, meeting rooms, convention halls,
or combination of these.
The City Council has determined, reasonably, that the Hilton Coliseum serves those functions for
the City of Ames.
A municipality cannot make a multi-year contract that controls its legislative powers or which
amounts to an abandonment of a governmental function or power; but, a multi-year agreement that
entails payment by a municipality with respect to a specified performance by another governmental
party to the agreement is a business transaction that does not restrain governmental functions of
either. See: City of Des Moines v. City of West Des Moines, 30 N.W.2d 500, 505, 507, (1948).
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