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Gary F. Van Den Boom v. City of Eldora

March 13, 2013

GARY F. VAN DEN BOOM, PLAINTIFF-APPELLANT,
v.
CITY OF ELDORA, DEFENDANT-APPELLEE.



Appeal from the Iowa District Court for Hardin County, Timothy J. Finn, Judge.

The opinion of the court was delivered by: Potterfield, J.

Gary Van Den Boom appeals from the grant of a motion for summary judgment in favor of the City of Eldora on his petition for an injunction. AFFIRMED.

Heard by Vogel, P.J., and Potterfield and Doyle, JJ.

Gary Van Den Boom appeals from the grant of a motion for summary judgment in favor of the City of Eldora (City) dismissing his petition for an injunction on the ground the petition was filed after the statute of limitations under Iowa Code section 384.25(2) (2011) had expired. Van Den Boom sought an injunction to prevent the City from entering into a general fund loan agreement to refinance U.S. Department of Agriculture (USDA) revenue bonds issued in 2007 for the purpose of building and operating a child care facility. The child care facility, which was built and operated, was defined as a "city enterprise" under Iowa Code section 384.24(2)(l).

Van Den Boom contends Iowa Code section 384.87, requiring revenue bonds to be paid out of the revenue of the city enterprise and defining revenue bonds as "not a debt or charge against the city," is the applicable statute. Van Den Boom also contends legal contradictions exist and that the district court did not construe the statutes consistently with division five of Iowa Code chapter 384, governing revenue financing. Finally, he argues he was denied due process and a fair trial when the district court did not allow him to conduct discovery prior to the summary judgment hearing.*fn1 We affirm, finding the district court correctly applied the statute of limitations in Iowa Code section 384.25(2) to Van Den Boom's petition.

I. Facts and Proceedings.

In 2007, the City adopted a resolution authorizing the City to enter into a loan agreement with the USDA for the purpose of building and establishing a child care facility (Resolution 2015). Resolution 2015 specified the loan was to be repaid solely from the net revenues of the child care facility.

Over the next four years, the City was unable to generate sufficient income from operation of the childcare facility to repay the loans. On May 19, 2011, the City adopted a budget amendment to address the issue; Van Den Boom petitioned the State Appeal Board protesting the budget amendment. The State Appeal Board issued an order denying $38,000 of the $1,648,000 capital projects expenditure in the budget amendment due to noncompliance by the City with Resolution 2015. After this denial, the City decided to proceed by a new resolution to refinance and refund the USDA loans through a general fund loan agreement under Iowa Code section 384.24A (Resolution 2382). Notice of this action was published on November 11, 2011.*fn2 The resolution authorized the City to enter into a general fund loan agreement in an amount not to exceed $340,000 to refinance the USDA loan.

A hearing was held as stated in the notice on November 28, 2011. The City then consulted with the State of Iowa Auditor and member of the State Appeal Board, David Vaudt, to evaluate the Resolution 2382 plan and determine what effect, if any, the prior ruling on the budget amendment would have on a potential general fund loan agreement. The State Auditor advised the City that:

Based upon the definitions [in Iowa Code Chapter 384, sections 384.24(2)(l), 384.3(f), and 384.24A] a child care center is an allowable city enterprise, the refunding of legal indebtedness is an essential corporate purpose, and the City can enter into loan agreements for any public purpose. Therefore, the refinancing of City's USDA child care facility revenue notes through a General Fund Loan Agreement under Code of Iowa Chapter 384.24A appears appropriate and complies with the Code of Iowa (provided the City adheres to all the applicable Code of Iowa requirements).

Vaudt concluded by stating that the proposed refinancing would render moot the earlier concerns raised before the state appeal board, as the USDA notes would no longer be outstanding. At a December 5, 2011 meeting, the City passed Resolution 2382. Van Den Boom was present at this meeting. However he did not file his petition in district court requesting an injunction until January 3, 2012-almost a month later.

February 17, 2012, the City filed a motion for summary judgment. This motion argued, among other things, that Van Den Boom's action was barred by the statute of limitations under Iowa Code section 384.25(2), which requires objections to be filed within fifteen days of the additional action by a city council to institute proceedings for the borrowing of money under Iowa Code section 384.24A. The district court agreed, and granted the motion for summary judgment based on the expiration of the statute of limitations. Van Den Boom appeals from this ruling.

II. Analysis.

We review this appeal from the district court's ruling on summary judgment in an equity case to determine "whether genuine issues of material fact exist and whether the law was applied correctly." Stanfield v. Polk Cnty., 492 N.W.2d 648, 649 (Iowa 1992). "If under the entire record, the only conflict concerns the legal ...


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