Press Release from the City of Oskaloosa
OSKALOOSA – The City of Oskaloosa is announcing a series of difficult budget reduction measures necessitated by ongoing changes to Iowa’s property tax system and the resulting financial impacts on local governments.
For the City of Oskaloosa, property taxes provide approximately 76% of General Fund revenues, which support many of the community’s most essential services, including police and fire protection, parks and recreation, library, building and community development services, and city administration. Due to anticipated budget shortfalls estimated between $500,000 and $600,000, representing roughly 7-8% of the General Fund, City leaders have spent the past several months carefully evaluating every available option.
“These were some of the most difficult decisions this Council has ever faced,” said city officials. “Our goal throughout this process has been to preserve the services our residents rely on every day while being responsible stewards of taxpayer dollars.”
Before considering workforce reductions, the City took several steps to identify savings elsewhere. The City Council sought input from residents to better understand community priorities and established a budget review committee tasked with identifying operational efficiencies and cost-saving opportunities. Through these efforts, approximately $250,000 in non-personnel budget reductions were identified.
In addition, the City implemented a hiring freeze on a vacant full-time police officer position. While difficult, Council will consider if they must permanently remove that position from the budget at a future meeting.
Despite these reductions, additional savings were still necessary to address the projected funding gap.
After extensive discussion, evaluation, and consideration of alternatives, the City Council made the difficult decision to eliminate two additional full-time positions: Parks and Recreation Director and Library Assistant.
City officials emphasized that these decisions are not reflective of employee performance.
“The City of Oskaloosa is fortunate to have a dedicated and talented workforce,” said city leaders. “Every employee plays an important role in serving our residents and keeping our community running. These decisions were not made because positions were unnecessary or because of the performance of the individuals who hold them. The reality is that our organization already operates with a very lean workforce. There were no excess positions to eliminate.”
City leaders acknowledged that any reduction in staffing will have an impact on city operations and service delivery. However, with limited alternatives available, Council ultimately determined these actions were necessary to protect the City’s most critical public services and maintain long-term financial stability.
Recognizing the personal impact these decisions have on the affected employees and their families, the City Council approved a voluntary separation package during a special meeting at noon on Monday, November 9, 2026, to provide support to the employees through the transition. The package includes enhanced compensation and continued health insurance coverage equivalent to three months of regular base pay and three months of employer-provided health insurance coverage.
Additionally, affected employees will receive any eligible vacation, sick leave, and other earned benefits in accordance with the City’s Employee Handbook.
To provide impacted employees time to carefully consider the severance package, Council has authorized a 45-day consideration period during which affected employees will remain on paid, non-disciplinary administrative leave. Employees who choose not to accept the voluntary separation incentive understand that doing so will not preserve the eliminated positions.
While these decisions are painful, City leaders remain committed to maintaining essential services, supporting employees through the transition, and continuing to advocate for sustainable solutions that allow municipalities to effectively serve their residents.
“The City of Oskaloosa remains focused on our mission of providing high-quality services and maintaining the strong community our residents expect and deserve. These decisions were made only after exhausting other options and with a clear understanding of the impact they will have on both our employees and our community.”
While these actions help address the City’s immediate budget challenges, they do not eliminate the long-term financial pressures facing local governments. City leaders recognize that difficult decisions still lie ahead and that the next steps will be challenging for both the City of Oskaloosa and the community as a whole. The City remains committed to working transparently with residents as it navigates these challenges and continues providing essential services in a financially sustainable manner.
