(Langdon Depot late 1800’s)
2010-2014 Capital Improvement Plan Council Meeting 12/16/09
City of Cottage Grove Capital Improvements Plan 2010-2014 Introduction The purpose of the Capital Improvement Plan (CIP) is to provide a planning device to schedule proposed public improvements and purchases over a five-year period. The Plan matches proposed expenditures and revenues by project within an affected fund. A capital improvement is defined as a capital expenditure that is greater than $15,000 with a life expectancy of five years or longer. Capital improvements are projects, which require acquisition, construction, or replacement of various public facilities, public buildings, infrastructure, utilities and parks in the community. Every effort has been made to draft the document as conservatively and realistically as possible while maintaining the integrity of the funds. The concept of fund integrity includes accounting for certain project costs in particular designated funds that are only used for those purposes for which they are collected. These major funding sources include the operating funds (the General Fund and Enterprise Funds), the development fees and charges (including the Area and Park Trust Funds), as well as identifying larger general projects that are expected to be financed with the issuance of general obligation bonds to be repaid with future property tax levies. The CIP attempts to maintain a relatively consistent level of spending for each year. This years CIP shows a total capital investment of $7.9 million for 2010 of which $1.4 million is related to the River Acres Pavement Management Project, $2.7 million for the 65th Street Improvements (100% County funded based on preliminary discussions), and $2.2 million($183,000 City funded) for the Pinecliff 2nd Addition. This document covers the period from 2010 to 2014, but we have included the 2009 projects from last years CIP for reference that have been completed or started in 2009. If a project identified in last year’s CIP as a 2009 project will not be started in 2009, it has been put into 2009 or later. The document is organized by the funding sources of the improvement project. Over the next five years $75 million in projected improvements have been identified. Included in this $75 million is $3.7 million that would be paid with levy dollars. The remaining dollars come from other identified sources. This version of the CIP also includes postponing some projects because of the unavailability of funding in the individual funds due to the downturn in the housing market. One additional component of the CIP is to identify projects beyond the five year period and totals over $148 million in improvements. The majority of the projects identified as beyond 2014 will likely take the next 15 to 20 years to complete and will likely change over the years as Council priorities change. This year’s CIP has again included postponing a number of items in the first two years. $11 million of projects identified in last year’s CIP for 2010 and 2011 have been postponed to later years. This postponement reflects the slow down in the construction market, the reduced need for facilities to serve the growth, and lower funding availability in some of the funds.
2010-2014 CIP Introduction
2010-2014 CIP 2009-2013 CIP
$
2010 7,949,339 $ 13,582,739
2011 12,089,800 $ 17,589,000
2012 11,856,200 $ 15,820,900
2013 18,711,900 $ 11,665,900
total 10-13 50,607,239 $ 58,658,539
post 148,076,400 163,936,300
Difference ('09 to '10)
$
(5,633,400) $
(5,499,200) $
(3,964,700) $
7,046,000 $
(8,051,300) $
(15,859,900)
Summary of Improvements Area Funds The Water, Storm Sewer and Sanitary Sewer Area Funds are capital project funds that provide the resources to construct general infrastructure. Projects totaling $3.2 million are expected to be funded from the area funds over the next 5 years. The funding sources for these funds are area charges against developing properties. The area charges are based on rates established by the City Council. Before these projects can be completed, the funds available in each of the area funds need to be considered. It may be necessary to postpone projects if the revenue sources are not available to complete the project. Area Fund Projects Map Gateway Pond 2010 Pinecliff 2nd Ph2 2011 Well 12 2011 97th St Ext 2012 95th Street Ph1 2013 Pond T6-P14 (95th - Ideal) Expansion of Pond 2013 East Ravine Water Twr Land Acquistion 2013 Jamaica 70th to Military
$ dev 2 st-4 st-46 ut-84 dev st-14
Water Area Sewer Area $ 26,000 1,500,000
$
704,100 6,500 400,000
13,600
$
100,000 40,000 1,679,600 $
Storm Area 350,000 $ 30,000
20,000 20,000 $
60,000 1,550,600 $
Total 350,000 56,000 1,500,000 704,100 20,100 400,000 100,000 120,000 3,250,200
Water Area Fund (p76) The largest project in the water area fund for the next five years is an additional well for $1.5 million. The Water Area Fund summary page shows the projected cash balances in this fund. During the next five years, the Water Area Fund is expected to spend $1.6 million on improvements and at the end of 2014 a cash balance of $1.7 will remain. A number of projects have been postponed from the prior years CIP because of the slowdown the construction industry. For example, a water supply and distribution plan was completed in January 2006 that indicated that the East Ravine water tower would be needed in 2010, based on development trends at that time. However, based on the reduction in new construction activity this tower has been postponed until after 2014. If resources are not available in the fund to complete the projects identified in the water supply and distribution plan then bonding may need to be considered. A new water treatment plant has been included in the post 2014 projects for $15 million. The construction of the water treatment plant will likely be funded with a combination of utility revenue bonds and area fund monies when the need arises. Sanitary Sewer Area Fund (p77) The projects identified for the Sewer Area Fund will have adequate funding through 2014 based upon conservative estimates and current rates. Bonds were issued for the
2010-2014 CIP Introduction
construction of the trunk sewer line in the Upper Ravine District of the East Ravine that was completed in late 2007. The bonds will be repaid by the area charges collected as The Upper Ravine District is developed. The bond payments are included in the debt service column. As projects are considered there may be additional projects identified for this fund. Storm Water Area Fund (p78) The Storm Water Area Fund summary schedule includes $1.2 million in projects at this time for 2010 to 2014. There is adequate funding in the fund for these projects. However, if the projects identified are part of larger project (i.e. if they are part of a street reconstruction project) and the larger project is moved up it may be necessary to issue debt to finance and complete the project. The debt would then be repaid with future storm water area charges or storm water utility charges. There is an additional $23.4 million of projects identified beyond 2014.
Assessments (p79 & p80) The projects in this group provide for rehabilitation of existing streets in the Pavement Management Program as well as other street reconstruction projects. For this year’s CIP we have again segregated the Developer Initiated Projects (p 79) from the Pavement Management Projects (p 80). The summary sheet identifies other funding sources when available, but for some projects it may be necessary to issue debt to be repaid with a property tax levy to finance the project. An example of these types of projects would be the continuation of the pavement management program, which includes assessments for a portion of the project. In addition to the Pavement Management projects, the developer initiated projects have been included in this document. The costs for these developer initiated projects are typically 100% assessed against the benefiting properties and the developer. Over the next 5 years $43 million in assessment projects have been identified of which $23 million will come from assessments or other funding sources. This includes $20.3 million of developer initiated projects that are 100% assessed.
2010 2011 2012 2012 2012 2012 2013 2013 2013 2014 2014 2014
Developer Initiated Location Pinecliff 2nd Addition -Phase 2 East Ravine - Various Locations 95th Street, Phase 1 East Ravine - Various Locations East Point Douglas (VFW to Keats) Oak Cove Hadley Avenue, 90th to 100th Jamaica Ave, 70th to Military East Ravine Hadley Avenue, 65th north to border East Ravine CSAH 19 & TH 61 Total All Years -2010 to 2014
$
$
Total 2,213,839 4,500,000 834,600 4,500,000 440,000 350,000 2,500,000 3,480,000 4,500,000 600,000 4,500,000 15,000,000 43,418,439
Funding Assessments Other $ 1,974,000 $ 239,839 4,500,000 $ $ 834,600 4,500,000 440,000 350,000 2,500,000 960,000 2,520,000 4,500,000 270,000 330,000 4,500,000 1,000,000 14,000,000 $ 22,554,000 $ 20,864,439
comment on Other Col. area fund share, City agreement development fees, area funds development fees development fees, MSA Incl. $2.4 M County Share development fees
$10M is State, $4M is MSA
2010-2014 CIP Introduction
The Pavement Management projects included in the next five years total $13.8 million, of which $6.1 million would be assessed to benefiting property owners and $3.7 million would be bonded. Future property taxes levies would repay these bonds.
2010 2011 2011 2011 2012 2012 2013
Pavement Management Location River Acres Road Reconstruction Pine Coulee Road Reconstruction West Point Douglas/TH 95 Howard's Addition Pinetree Pond East (E of Jamaica, N of 80th, W of Kingston) Jenner, Jocelyn, and 79th Street: S of Kingston, N of 80th Pinetree Pond East (E of Jamaica, S of 70th, W of Joliet)
2013 90th Street, Jamaica to Jewel 2014 S of 80th, E of W Central Corridor, W of E Central Corridor, N of Woodridge Total All Years -2010 to 2014
Map Location H2, H1 $ I1 st-11 A1 C1
Funding Total Assessments Other Debt levy 1,424,800 $ 641,200 $ 126,000 $ 657,600 1,547,700 696,500 280,000 571,200 1,000,000 450,000 550,000 260,800 117,400 28,000 115,400 2,059,300
926,700
523,600
609,000
585,700
263,600
186,500
135,600
4,005,200 293,300
1,802,300 60,000
1,219,900 233,300
983,000 -
1,171,300 6,129,000 $
828,800 3,976,100 $
C3
C2
F2 $
2,602,900 13,779,700 $
602,800 3,674,600
Municipal State Aid (MSA) Funded projects (p81) The streets included on the “state aid” system are eligible to receive state aid for a portion of the projects. The MSA project summary includes an annual allotment of approximately $1.2 million for 2009 with a 2% increase per year. As per the settlement agreement with US Homes in 2007 the MSA fund includes $184,000 in expenditures that the City is responsible for. The projects noted below and in the CIP will be dependant on development needs and the timing can change based on needs. In 2010, the County is expected to reconstruct 65th Street 1000 feet west of Hinton to Hastings Avenue in Newport (excluding the portion on either side of Hadley which the City has already reconstructed). The County will pay for the $2.7 million project based on preliminary discussions but those discussions continue. The roadway will then be turned over to the City and will become a MSA road. The MSA funded projects identified over the next 5 years include:
2010 2011 2012 2012 2012 2013 2014 2014
Pinecliff W Pt Douglas/TH 95 70th and Hardwood (city share) Hinton Ave. Reclamation 73rd to 70th Hadley Avenue CSAH 19 and TH 61 Ravine Parkway –Phase 2
Settlement agreement Extension of roadway Intersection improvements 80th to 70th Sidewalk 90th to 100th Overpass improvement Upper Ravine District Total 2010 to 2014
MSA Portion $183,839 550,000 1,000,000 543,000 42,500 1,900,000 4,000,000 1,000,000 $9,219,339
Enterprise Funds The projects included in the Enterprise Fund section are those projects, which would be paid for from the Water, Sanitary Sewer and Storm Water Utility Funds. The funding sources for each of the enterprise funds are user fees for the services provided within each fund.
2010-2014 CIP Introduction
Water Utility (p82) The major water utility fund improvement in the next five years is the repainting of the 1 million gallon water tower for $555,000. Other costs included in the fund are for the pulling of one well for maintenance purposes each year and the utility portion of pavement management projects, totaling $159,600 in the next 5 years. It is anticipated that operating revenues of the Water Enterprise Fund will be sufficient to pay for the scheduled improvements as needed. Included in Post 2014 is the utility funds possible purchase of fire station 2. This may occur if the fire services are relocated to the new proposed public safety/city hall and it is determined that the current fire station 2 could be used for utility operation/storage. Sanitary Sewer Utility (p83) The sanitary sewer utility includes $1.5 million in projects to be completed in the next five years, of which $1.4 million are portions of projects completed along with pavement management projects. Other projects identified are access trails in certain areas totaling $127,800. Storm Water Utility (p84) The Storm Water Utility projects include the funding for various drainage corrections and maintenance of the storm water utility system. The Storm Water Utility was started in the 2002 budget year and the projects identified and prioritized by staff must stay within the financial constraints of the fund. The 2010 projects identified include storm water improvements to be completed with the River Acres Pavement Management Project and various storm water ponds improvements. The remaining commitments of the fund for the next five years are for various storm water activities throughout the City. The rates for 2010 (last changed in 2008) and beyond are based on the current $48 rates. Project beyond 2011 will need to be evaluated and delayed because of projected deficits in the fund unless a rate increase is approved. Street Light Enterprise (p85) The improvements scheduled for the Street Light Utility are traffic signals and a possible street light luminary replacement program. A trial project of the Street Light Luminary replacement program has been included in the operating budget to estimate the potential savings and lighting effects. Golf Course Enterprise (p86) The improvements scheduled for the Golf Course in the 2010 budget includes equipment replacement and a new sign. The equipment replacement will be funded with operating revenues of the golf course and the timing will be considered, as resources are available.
Building Replacement Fund (p87) This fund accounts for municipal building repairs that are not funded by another source. It must be noted that this fund currently has no ongoing funding source other than a transfer from the General Fund per the Fund Balance policy. A levy for future building replacement is proposed to begin again in 2012. The levy is included at $20,000 for 2012 and $40,000 for 2013 and beyond.
2010-2014 CIP Introduction
General (p88-89) The projects included in the General section are those projects which would be paid for from the City’s General Fund. As the projects are considered they will need to be included in the general fund budget for that particular year. Park Shelter Replacement / Public Landscaping Initiative (p90) In 2009, it is proposed to create a new fund to account for the activities related to the Park Shelter Replacement program as well as the Public Landscape Initiative addition. In 2004, the City Council established an ongoing levy of $100,000 to address deferred maintenance issues with city facilities including playground equipment replacement and/or park shelters. The funding for this was established at $100,000 in the 2004 budget. By the end of 2005, most of the playground equipment was replaced and attention was turned to the park shelters. The levy is at zero for 2010 and 2011 but is included at $20,000 for 2012 and $40,000 beyond 2013.
Sealcoating Fund (p91) The sealcoating fund was created in 2007 and the largest funding source for this fund includes the franchise fee on monthly electric and natural gas utility bills. The costs identified for this fund include the annual sealcoating program. 2010 fees were approved to increase by 32% to fund the activities in the fund.
Ice Arena (p92) The anticipated projects at the Ice Arena include a monument sign and a South Rink dehumidifier in 2010. A chiller system conversion from direct to indirect for $1 million is included in post 2014.
Park Trust (p93-94) In general, the improvements scheduled in the Park Trust Fund include the purchase of additional parkland, development of parks and trails, and installing playground equipment in new parks. Revenues coming into the Park Trust Fund have been calculated to reflect the anticipated housing growth and a greater dedication of park land instead of park dedication fees. The goal of the City had been to maintain a minimum ending cash balance of approximately $100,000 which occurs in the CIP until 2013. The projected future balance also includes the proceeds from the Oakwood lot sale and these amounts have been earmarked for ball field improvements in Hamlet Park included in 2013 in this CIP.
Debt Schedule (p-95-99) The included debt projection schedule anticipates issuing levy-related debt primarily to fund the pavement management program. Typically, with a pavement management project, special assessments against benefiting properties cover a portion of the cost (the CIP uses an assessment estimate of 45% as recommended by the IMTF task force) and the remainder of the construction cost is then paid through a property tax debt levy or from the utility funds. Pavement management related debt is matched to the assessment term, which is 15 years. The debt schedule below includes the current levy amounts for all bonds issued to date and includes estimated levies for the pavement management projects currently identified. Projects identified in the next 5 years include River Acres, Pine Coulee, Howard’s Addition, Pinetree Pond East (east of Jamaica, south and west of Kingston, and north of 80th), Pinetree Pond East (Jenner, Jocelyn, and 79th Street: S of Kingston, N of 80th), Pinetree Pond East (east of Jamaica, west of Joliet, south of 70th, and north of Kingston) and West Central Draw (east of Jamaica, south of 70th, and west of Joliet) pavement management districts, totaling $13.8 million in construction
2010-2014 CIP Introduction
costs and requiring $7.7 million in new debt. Included beyond the year 2014 are pavement management districts totaling approximately $16 million more in construction costs and resulting in approximately $10.6 million more in new debt that would be issued to finance these projects. The future debt service includes estimated growth in the tax capacity of approximately 4% beyond 2012 Tax Capacity Actual tax Base % Change
2008 2009 2010 2011 2012 2013 $ 29,764,369 $ 30,445,931 $ 28,690,900 $ 28,327,082 $ 28,610,000 $ 29,754,000 3.7% 2.3% -5.8% -1.3% 1.0% 4.0%
Bonded debt as a percentage of market value is at .81% per year after 2011 which is the Median for AA1 Cities. The graph below shows the annual property tax levy to service the debt. The amount shown as “future pavement management debt service” is net of any expected assessment revenues that may be collected. The pink bar portion of the graph represents future “levy capacity” and is amounts in the levy that would be available for new public facilities which could include a Community Center or Public Safety /City Hall facility. The bonded debt issuance for this future “levy capacity” is included at approximately $6 million in 2016 and $2 million per year after 2016. The red bar represents the Ice Arena expansion at $240,000 per year. Adjustments to the projected levies have been made in the amount of $300,000 per year in 2012 and 2013 to offset high debt levy increases needed in 2014 and 2015.
2010-2014 CIP Introduction
The following General Levies are included to begin again in 2012 are as follows: Park shelter/landscape initiative Building replacement Future debt reduction/PM
2012 $20,000 20,000 20,000
2013 and beyond $40,000 40,000 40,000
Conclusion City staff has prepared this document in conjunction with those projects and capital items that are known and for which costs can be reasonably estimated. The CIP should be considered a planning tool and the projects included for 2010 and 2011 serve as a work plan for staff. This “work plan” means that these are the projects that staff will bring to Council for authorization before proceeding with a feasibility study, acquisition, or construction. All projects detailed in this document will be included in their respective budgets if the need is established at that time.