Court Opinion

ID: 4583610
Source: CourtListenerOpinion
Date Created: 2020-11-04 16:04:59.793184+00
Date Added: 2024-06-11T13:44:33.144210
License: Public Domain

IN THE COURT OF APPEALS OF IOWA

                                   No. 19-1010
                             Filed November 4, 2020

AL BRUEGGEMAN, DAN BREUKER, TOM BREMER, ROGER BOSMA, MARK
DILLEHAY, RANDY ROWE, ALLEN ROWE, and JARROD WALLACE,
     Plaintiffs-Appellants,

vs.

OSCEOLA COUNTY, IOWA and CITY OF HARRIS, IOWA,
     Defendants-Appellees.
________________________________________________________________

      Appeal from the Iowa District Court for Osceola County, David A. Lester,

Judge.

      Taxpayers appeal the district court’s ruling denying their petition for writ of

certiorari that challenged the joint adoption of an urban renewal area by the city

council and the county board of supervisors. REVERSED AND REMANDED.

      Aaron W. Ahrendsen and John C. Werden of Eich Werden Steger &

Ahrendsen PC, Carroll, for appellants.

      Stephen G. Kersten, Fort Dodge, for appellees.

      Heard by Doyle, P.J., and Tabor and Ahlers, JJ.
                                          2

TABOR, Judge.

       This case returns to our court for a second time.1             This go-round,

Al Brueggeman and seven other taxpaying residents of Osceola County

(collectively “the taxpayers”) contend a resolution adopted by the City of Harris and

Osceola County violates Iowa’s urban renewal law.           See Iowa Code ch. 403

(2015). That resolution anticipated using tax increment financing (TIF)2 to raise

revenue from properties with windmills in the county to cover the costs of the city’s

sewer rehabilitation project. In challenging the resolution, the taxpayers argued

the city and county ran afoul of the urban renewal law in three ways: (1) by not

entering into a valid joint agreement before passing the resolution, in violation of

Iowa Code section 403.17(4); (2) by establishing urban renewal areas that were

not contiguous, in violation of section 403.17(23); and (3) by including wind energy

conversion properties in the TIF, in violation of the ”spirit and purpose” of the urban

renewal law. The district court rejected the taxpayers’ claims.

1 In the first appeal, we addressed two preliminary issues: 1) whether the taxpayers
had standing to contest the resolution establishing the urban renewal area; and
2) whether the taxpayers were untimely in challenging the ordinance authorizing
tax increment financing in the urban renewal area. Brueggeman v. Osceola Cnty.,
No. 16-1552, 2017 WL 2464072, at *1 (Iowa Ct. App. June 7, 2017). Although we
agreed with the district court that the taxpayers were untimely in challenging the
TIF ordinance, we allowed the case to proceed based on the resolution. Id. at *5–
7. On timeliness, we stated: “Because the final action in the adoption of the
ordinance took place on November 10, the plaintiff’s November 3 petition
challenging the ordinance was untimely.” Id. at *5 (citing Iowa R. Civ. P.
1.1402(3)). On standing, we reversed the district court’s ruling, finding the
taxpayers could challenge the resolution because it was “sufficiently likely” they
would suffer harm from the creation of the urban renewal area due to the
anticipated use of TIF. Id. at *7.
2 See Iowa Code § 403.19 (authorizing use of TIF “for the benefit of the state, city,

[or] county”); see also Brueggeman, 2017 WL 2464072, at *1 n.1 (quoting
Concerned Citizens of Se. Polk Sch. Dist. v. City of Pleasant Hill, 878 N.W.2d 252,
254 (Iowa 2016) (providing a detailed explanation of the TIF process)).
                                          3

        On appeal from that rejection, the taxpayers reprise all three challenges to

the urban renewal area. But their focus is on the first claim. They argue the city

council could not retroactively ratify an alleged joint agreement with the county, as

required by section 403.17(4) to form the urban renewal area. Why not? Because

the council did not pass a resolution, as required by Iowa Code section 364.3(1),

authorizing the mayor to enter into that agreement. The taxpayers argue that

under City of Akron v. Akron-Westfield Community School District, any oral

agreement between the mayor and the county was void (not just voidable) and

thus not subject to later ratification. See 659 N.W.2d 223, 225 (Iowa 2003).

        We agree City of Akron controls. That case held that “any contract with a

city entered without a formal motion, resolution, amendment or ordinance is void.”
Id.    In justifying what seemed like an “unduly harsh” result, the Akron court

reasoned: “The legislature considered it of first importance for city officials to

observe formal requirements before obligating taxpayers to finance the affairs of

city government.” Id. at 225–26. Because Harris did not take formal action to enter

the joint agreement with the county, any later effort at ratification fails. Without a

valid joint agreement, the city and county did not satisfy the requirements of section

403.17(4) for establishing the urban renewal area.         Given the importance of

protecting taxpayers from municipal actions executed without observing statutory

requirements, we reverse the ruling and remand to the district court. Finding the

first issue dispositive, we need not address the two other claims on appeal.

      I. Facts and Prior Proceedings

        Harris is a small city in Osceola County. In fact, at last count, the city had

fewer than two hundred residents.        To serve those residents, Harris began
                                         4

operating its own wastewater treatment facility in 2004 under a pollution discharge

permit issued by the Iowa Department of Natural Resources (DNR). For many

years, Harris drained its wastewater into a single “stabilization lagoon.” That

lagoon drew DNR scrutiny from 2008 until 2014 because wastewater often

overflowed into the nearby Ocheyedan River.          Finding “the lagoon was not

providing adequate storage time before wastewater was being released to the

receiving stream,” the DNR issued an administrative consent order against the city

for violating its permit and DNR regulations. Under the consent order, Harris had

to “submit a facility plan for the rehabilitation of the collection system” by August

2015 and begin reconstruction by July 2016. All repairs and improvements needed

to be completed by August 2017 to avoid civil and possibly criminal penalties.

       In February 2015, the city council and mayor Greg Spaethe met to discuss

the DNR order. Although the city council unanimously agreed to move forward

with the rehabilitation project, the city lacked a sufficient tax base to pay for the

improvements. With estimated costs “ranging from $1.2 million up to $2 million,”

city attorney Daniel DeKoter recommended using TIF, explaining it “was the only

available source” of financing that would allow the city to bring the facility up to

code.3 Because TIF required creating an urban renewal area that would include

certain windmill properties located beyond the city’s boundaries, DeKoter informed

the city council that Harris could not proceed with the project without Osceola

County’s consent.

3DeKoter testified “the borrowing capacity, under [the city’s] general bonding,
would be maybe $400,000 to $500,000 maximum.” But with TIF, the city would
have the capacity to borrow from general tax revenue funds available to Osceola
County to finance the project.
                                          5

       Based on DeKoter’s recommendation, the city council unanimously passed

resolution number 02.10.15.02 that stated:

              Section 1. That it is hereby determined that it is necessary and
       advisable to hire a bond counsel for Tax Increment Financing for the
       Lagoon & other projects.
              Section 2. By hiring a bond counsel the City of Harris will be
       able to obtain the funding necessary for the number of improvements
       that the City needs.
              BE IT FURTHER RESOLVED, the City Council hereby
       delegates the Mayor and City Clerk the duty of hiring a bond counsel
       for Tax Increment Financing for the Lagoon and other projects.

(Emphasis added.) Although the resolution delegated “the duty of hiring a bond

counsel,” the city council provided little clarity as to the scope of that duty in the

meeting minutes.4 When asked to provide context, DeKoter explained that “as

long as they were meeting, they should adopt a resolution to hire bond counsel”

so   the city could move forward           with   the TIF     and   not   “keep   that

process suspended.”5

       DeKoter believed the resolution to hire a bond counsel included

authorization for the mayor to make “agreements with the County to move forward

with TIF.”   Mayor Spaethe and city clerk Chrissi Wiersma shared a similar

understanding.    They testified that the bond-counsel resolution, in their view,

included implied authorization for them to enter into the actual joint agreement with

Osceola County, as needed for the TIF plan.

4  The scope of the delegation is at issue on appeal because the taxpayers
challenge the conduct of the mayor purporting to act on behalf of the city. Under
Iowa Code section 364.2, the “power of a city is vested in the city council except
as otherwise provided by a state law.”
5 DeKoter testified that either the city or the county could issue the bonds, “[b]ut if

it would happen that the City would turn out to be the preferred initiator of the
bonds, then they would need to be able to hire bond counsel.”
                                         6

       Shortly after the city council meeting, Wiersma sent a letter to the county,

asking generally for its assistance with financing the city’s project. The letter

stated, in part:

              The City of Harris is asking for help with possibly doing a TIF
       on the windmills for infrastructure within the City as well as possibly
       repairing and paving road in and around Harris.
              A representative from Harris would be more than willing to
       come before the Board of Supervisors to discuss the possibility of
       entering into an agreement with the County.

According to Wiersma, “[t]he purpose of the letter was to get a conversation going”

between the city and county about how to proceed with the project.

       In late March 2015, Wiersma and Mayor Spaethe attended a board meeting

on behalf of the city to discuss the letter. During his deposition, Mayor Spaethe

explained his primary goal was to secure agreement from the board of supervisors6

to undertake the bond obligation because of the city’s limited debt capacity.

       Recalling that meeting later in his deposition, board chairperson Merlin

Sandersfeld remembered asking Mayor Spaethe whether he had “full consent”

from the city council to make that request. Sandersfeld also sought a copy of the

city council’s February resolution, but he did not see the resolution at that time.

Relying on the mayor’s assurance, the supervisors voted in favor of helping the

city finance its urban renewal project and beginning the bond process for the TIF.

The minutes of that meeting show the board’s approval of hiring bond counsel for

the project. Although the minutes do not refer to any formal agreement between

6 The board is the governing body for Osceola County under Iowa Code section
311.301(2), which states: “A power of a county is vested in the board, and a duty
of a county shall be performed by or under the direction of the board except as
otherwise provided by law.”
                                          7

the mayor and the board, Mayor Spaethe and two supervisors testified that they

entered into an oral agreement that same day to formalize the board’s consent.

         At a meeting later that August, the board unanimously voted to approve the

engagement of Dorsey & Whitney Law Firm and the hiring of a financial consultant

for the urban renewal project. The board met again in September, passing the

county’s first formal resolution. Under that resolution, the board published a notice

of public hearing set for October 20, 2015, inviting Osceola County residents to

voice their opinions about the urban renewal project and the TIF plan.          The

resolution also directed the county auditor to present a formal joint agreement to

the city before the public hearing date. Before the board’s September resolution,

the record reveals no mention of a formal joint agreement.

         The taxpayers (who now appeal) attended the October 20 hearing and

voiced their objections to the proposed urban renewal plan.             Noting their

objections, the board nevertheless passed resolution number 10-15/16,

establishing the urban renewal area. That resolution stated:

                Section 1. An economic development and blight area as
         defined in Chapter 403 of the Code of Iowa is found to exist on the
         Property.[7]
                Section 2. The Property is hereby declared to be an urban
         renewal area, in conformance with the requirements of Chapter 403
         of the Code of Iowa, and is hereby designated the Osceola County
         Urban Renewal Area 7.
                ....
                Section 6. The Joint Agreement between the County and the
         City as has been presented to the Board is hereby approved, and the

7   Iowa Code section 403.5(1) states:
         A municipality shall not approve an urban renewal project for an
         urban renewal area unless the governing body has, by resolution,
         determined the area to be a slum area, blighted area, economic
         development area or a combination of those areas, and designated
         the area as appropriate for an urban renewal project.
                                         8

      Chairperson and County Auditor are hereby authorized and directed
      to execute said agreements on behalf of the County.

Following the resolution’s adoption, the board chairperson and county auditor

signed the joint agreement. That same meeting, the board also gave “its initial

consideration”8 to ordinance number 47—tentatively voting to authorize the TIF

and to give notice of the specific properties included in the plan. The board

approved the ordinance several weeks later.

      Although the joint agreement suggested it was “entered into by and between

the City of Harris, Iowa and Osceola County, Iowa as of October 20, 2015,” only

the board signed the agreement on that date. The city council did not vote until a

November 30, 2015 special meeting. Then, a formal motion “unanimously carried

to enter into a written agreement with Osceola County.” The final joint agreement

contained this language:

              WHEREAS, in August of 2015, the City and the County
      entered into a verbal agreement[9] (the “Joint Agreement”) with
      respect to the County’s undertaking of the urban renewal action
      hereinafter described . . . .
              ....
              WHEREAS, at the request of the City, the County has
      approved this written contract to memorialize the Joint Agreement;
              NOW, THEREFORE, it is agreed by the County and the City
      as follows:
              ....
              Section 2. This Agreement is intended to memorialize the prior
      verbal agreement between the parties and to meet the statutory
      requirements of paragraph 4 of Section 403.17 of the Code of Iowa
      and shall be effective upon execution as of the date first listed above.

8 See Iowa Code § 331.302(6)(a) (“A proposed ordinance or amendment shall be
considered and voted on for passage at two meetings of the board prior to the
meeting at which it is to be finally passed . . . .”).
9 Both parties agree the joint agreement’s recitation is incorrect because the oral

agreement at issue occurred at the March board meeting. Nothing in the record
suggests there was another agreement in August 2015.
                                          9

       But before the city council held its formal vote in late November, the

taxpayers petitioned for writ of certiorari and declaratory judgment against the city

and county, challenging the board’s October resolution. The taxpayers moved for

summary judgment, asserting the claims that are now on appeal. In resistance,

Harris and Osceola County claimed the taxpayers lacked standing and were

untimely in filing their petition.   Accepting those arguments, the district court

dismissed the taxpayers’ petition. But on appeal, our court reinstated the case,

finding the taxpayers had standing to challenge the resolution. Bruggeman, 2017

WL 2464072, at *7.

       On remand, the taxpayers unsuccessfully renewed their motion for

summary judgment. The court ruled 1) the oral agreement between the city and

county was not void, but voidable, and thus could be ratified after the fact; 2) no

statute required that properties within an urban renewal area must be “contiguous”;

and 3) the county did not violate the “intent, purpose, and spirit” of the law by using

TIF on the wind energy conversion properties.

       Based on the court’s ruling, the city and county moved for summary

judgment, claiming ratification of the oral agreement was sufficient to satisfy the

consent requirement of section 403.17(4). The court denied the motion while

acknowledging the apparent inconsistency with its previous ruling:

       In its October 11, 2017, ruling denying Plaintiffs’ renewed motion for
       summary judgment, the Court concluded that when all facts in that
       summary judgment record were construed in favor of Defendants, . .
       . the verbal agreement between the City’s mayor and the Board was
       a voidable contract subject to later ratification by the City’s council
       during its meeting held on November 30, 2015. In now construing
       those same facts in a light most favorable to Plaintiffs, . . . the Court
       finds there is a genuine dispute of material fact whether that verbal
                                          10

        agreement was void as a contract . . . and was therefore not subject
        to ratification by a later vote of the City’s council.

        Before the trial, the parties decided to submit the case on exhibits and

written arguments.10 In its final ruling, the district court clarified that the sole

remaining question was “whether the joint oral agreement entered into by the City’s

mayor and the board was a voidable contract subject to ratification by the

subsequent execution of a written joint agreement or whether it was a void contract

not subject to ratification.”

        In answering that question, the court first noted the city “could have

authorized [Mayor] Spaethe to enter into a verbal agreement with the Board by

passing a resolution in accordance with Iowa Code Section 364.3(1).” Despite

finding the city council “clearly failed to properly exercise that authority,” the court

determined the oral agreement was a voidable contract subject to ratification. So

the court held that the joint agreement was valid and enforceable as of March 2015

because neither the city council nor the board ever sought to “avoid” the oral

agreement. The court thus dismissed the petition. The taxpayers appeal.

     II. Standard of Review

        We review certiorari actions for correction of errors at law. State v. Iowa

Dist. Ct. ex rel. Story Cnty., 843 N.W.2d 76, 79 (Iowa 2014). In doing so, we “may

examine only the jurisdiction of the district court and the legality of its actions.”

State Pub. Def. v. Iowa Dist. Ct., 633 N.W.2d 280, 282 (Iowa 2001) (quoting

Christensen v. Iowa Dist. Ct., 578 N.W.2d 675, 678 (Iowa 1998)). A court acts

10At the parties’ request, the district court held a hearing in August 2018. The
court approved the stipulation and admitted the offered exhibits into the record.
                                          11

illegally when its findings are unsupported by substantial evidence or when the

court has not properly applied the law. Id.

   III. Validity of the March 2015 Oral Agreement

       This appeal poses a binary question: was the March 2015 oral agreement

between the mayor and county supervisors void or voidable? The taxpayers

contend any agreement was void because the mayor did not secure authorization

by a vote of the city council before approaching the supervisors. See Iowa Code

§ 364.3(1) (“A city council shall exercise a power only by the passage of a motion,

a resolution, an amendment, or an ordinance.”). That official action, according to

the taxpayers, did not come until the city council voted to approve the joint

agreement in November 2015. Pointing to that timeline, the taxpayers assert the

district court acted illegally in deciding the oral agreement was a voidable contract

subject to ratification.

       To counter, the city and county argue the mayor did have proper authority.

They claim “inherent” in the resolution approving the hiring of bond counsel was

authority for the mayor to move toward a joint agreement for the TIF and urban

renewal project. In other words, they claim the city’s February resolution satisfied

its obligation under section 364.3(1). Under this line of argument, even if the oral

agreement was flawed, it remained valid because it was voidable rather than void.

And neither the city nor the county tried to avoid it.

       Our analysis starts at the intersection of chapter 403 and section 364.3(1).

Chapter 403 gives broad authority to cities and counties to create urban renewal

areas. See id. §§ 403.2, .19. At the same time, chapter 403 imposes procedural
                                           12

requirements for cities and counties undertaking joint ventures. Section 403.17(4)

describes one of those requirements:

       [I]n that area outside a city’s boundary but within two miles of the
       city’s boundary, a joint agreement between the city and the county is
       required allowing the county to proceed with the activities authorized
       under this chapter. In addition, a county may proceed with activities
       authorized under this chapter in an area inside the boundaries of a
       city, provided a joint agreement is entered into with respect to such
       activities between a city and a county.

(Emphasis added.)

       For its part, section 364.3 limits the powers of a city. To exercise its power—

for example, the power to reach a joint agreement with the county—a city must

approve any action by formal vote.          See Iowa Code § 364.3(1).             “A city’s

compliance with Iowa Code section 364.3(1) is crucial.” City of Akron, 659 N.W.2d

at 225. If a city does not comply with the formal requirements of section 364.3(1),

any contract entered into is void. Id.

       To settle the void-versus-voidable dispute, we must decide whether the city

complied with section 364.3(1) before authorizing the mayor to execute a joint

agreement with the county to satisfy the requirement under section 403.17(4).

Under these provisions, if the city’s February resolution did not authorize the

mayor’s representations to the supervisors, the oral agreement was void and could

not be later ratified. See id. But if the resolution did give the mayor the power to

contract, the oral agreement was voidable and any defects could be cured by

ratification. See City of Creston v. Barney, No. 11-1154, 2012 WL 470169, at *2

(Iowa Ct. App. Feb. 15, 2012).

       The district court flirted with the City of Akron holding in its ruling:
                                          13

       [A]t first glance, it appears that the outcome of this case should be
       dictated by the legal principles and authorities set forth in the City of
       Akron case with this court concluding that the oral agreement
       reached between Mayor Spaethe and the Board during the Board’s
       March 24, 2015, meeting was made in violation of Iowa Code Section
       364.3(1), and thus is void.

But the court ultimately married its decision to City of Creston, where our court held

that government contracts were voidable when the power to contract had “been

clearly vested with a municipality, but it [was] irregularly or defectively exercised.”

2012 WL 470169, at *2 (citations omitted).

       To test the district court’s determination, we compare those two cases. In

City of Akron, a school district wanted to start its own wind energy conversion

project but could not proceed without the city’s help. 659 N.W.2d at 225. After

several meetings between the school district and city representatives, the parties

entered into a written contract requiring the city to buy electricity from the school

district’s wind project. Id. Although the city was aware of project discussions, the

city administrator signed the contract without official authorization by the city

council. Id. When a new mayor took office, the city sued the school district to

invalidate the contract, claiming the council never approved the contract by motion,

resolution, amendment, or ordinance. Id.

       Although sympathetic to the school district, which relied on the contract for

eighteen months, our supreme court held the contract was void because the city

bypassed the formal requirements of section 364.3(1).           Id.   Deferring to the

legislature, the court reasoned that a party’s “good faith” intentions did not

overcome the need “to observe formal requirements before obligating taxpayers

to finance the affairs of city government.” Id. at 225–26 (“A contract, unlawful for
                                         14

lack of authority, is not rescued by good faith.”).       The court noted that the

“involvement of two contracting governmental entities rather than one would

elevate, not lower, the importance of compliance with the statute.” Id.

       In City of Creston, the city council passed a resolution authorizing the mayor

and city clerk to execute a policy that required police officers to reimburse the city

if the officers resigned within three years of training. 2012 WL 470169, at *1.

Barney, a Creston police officer, signed an agreement containing those terms at

the time of hire. Id. But instead of the mayor or city clerk, the chief of police

executed the agreement on behalf of the city. Id. Soon after, the city council

passed another resolution formally approving Barney’s reimbursement agreement.

Id. When Barney resigned one year later, he refused to reimburse the city,

claiming his agreement was invalid because it was “signed by the chief of police,

who did not have contractual authority” under section 364.3(1). Id. Because the

city did not comply with the formal requirements of the statute at the time of

execution, Barney claimed the reimbursement agreement could not be ratified. Id.

       Rejecting Barney’s claims, we found that his agreement was a valid contract

because the first resolution specifically authorized the city to enter into

reimbursement agreements, “such as the one signed by Barney.”              Id. at *3.

Because the city council passed an authorizing resolution, we determined the

agreement did not violate section 364.3(1) and was thus not void. We reasoned

the procedural error of the chief of police signing the contract rather than the mayor

or city clerk rendered the agreement voidable because “[t]he error occurred in

implementation of the policy, not the adoption of the policy.” Id. We held that the

city council could ratify the voidable agreement by the later resolution. Id. at *5.
                                          15

       After comparing Akron and Creston, we find this case falls somewhere in

the middle. On one extreme, the Akron City Council passed no resolution at all

before the city administrator entered into a contract with the school district. City of

Akron, 659 N.W.2d at 225. Here, the city council passed a resolution delegating

at least some authority to the mayor and city clerk. But unlike City of Creston,

where the resolution specifically authorized the city to enter into the type of

agreement at issue, 2012 WL 470169, at *1, here, the resolution did not authorize

the mayor to enter into a joint agreement with Osceola County. Instead, the

resolution only delegated the duty of hiring a bond counsel for TIF financing “for

the lagoon and other projects.”

       In its ruling, the district court acknowledged that the only formal resolution

passed by the city council “on February 10, 2015, did not specifically authorize the

mayor to verbally enter into a joint agreement with the County.” To distinguish City

of Akron, the court inferred that the Harris City Council “intended to confer” the

mayor authority to enter into the joint agreement when it passed the February

resolution. Based on that inferred intent, the court determined the city’s power had

been irregularly or defectively exercised. The court gave significant weight to the

testimonies of the city attorney, mayor, and city clerk, showing that they all believed

the mayor had authority to enter the joint agreement. But their subjective beliefs

do not satisfy the formal requirements of section 364.3(1).

       The district court wrongly decided the oral agreement was a voidable

contract. Unlike City of Creston, the error here concerns the Harris City Council

adopting a resolution that did not give adequate notice to the taxpayers and the
                                         16

public that the mayor had the go-ahead to enter a joint agreement to launch an

urban renewal project. The court’s own analysis undermines its conclusion:

       [T]he court finds that the City’s Council clearly could have authorized
       [Mayor] Spaethe to enter into a verbal agreement with the Board by
       passing a resolution in accordance with Iowa Code Section 364.3(1).
       The City’s Council clearly failed to properly exercise that authority
       resulting in them, instead, directing [Mayor] Spaethe to contact and
       offer to meet with the Board, and then later ratifying the oral
       agreement . . . .

(Emphasis added.) By finding the council “clearly failed” to authorize the mayor to

execute the agreement, the court acknowledged that the February resolution did

not satisfy the requirements of section 364.3(1). Because the error related to the

city council’s failure to delegate its authority rather than implementing the joint

agreement, the court’s reliance on City of Creston was misplaced.

       Under Iowa case law, “[c]ontracts with public entities are unenforceable

when   executed    without   proper    approval   or   compliance    with   statutory

requirements.” Serv. Emps. Int’l Union, Local 199 v. Iowa Bd. of Regents, 928

N.W.2d 69, 77 (Iowa 2019) (citations omitted). We require public votes and formal

approval of government contracts because of the importance of protecting

taxpayers and safeguarding a free and open democracy. Id.

       Applying those principles here, we find the oral agreement was void, and

therefore unenforceable. See City of Akron, 659 N.W.2d at 225; see also Madrid

Lumber Co. v. Boone Cnty., 121 N.W.2d 523, 525 (Iowa 1963) (“When the

legislature permits the exercise of power in a given case only in accordance with

imposed restrictions, a contract entered into in violation thereof is not merely

voidable but void.”   (citations omitted)).   The oral agreement reached at the

supervisors’ meeting in March was void because the mayor did not have authority
                                        17

under section 364.3(1). By establishing the urban renewal area before entering

into a valid joint agreement, the city and county violated section 403.17(4). And

as the taxpayers urged, the void agreement could not be cured by ratification. The

district court erred in dismissing the taxpayers’ petition. Thus we reverse and

remand for further proceedings not inconsistent with this opinion.

      REVERSED AND REMANDED.