AGENDA #1

 

BUDGET WORKING PAPER

 

TO:

Roger L. Stancil, Town Manager

FROM:

Kay Johnson, Finance Director

 

Rick Shreve, Budget Analyst

SUBJECT:

Capital Improvements – Priority Additions

DATE:

April 18, 2007

 

PURPOSE

 

The purpose of this document is to provide context and supporting information for the requested additions to the Capital Improvements Plan (CIP) for the FY 2007-08 budget.

 

BACKGROUND

 

The Council has authorized a 15-year Capital Improvements Plan for a number of years.  Unfortunately, annual budgetary constraints have resulted in postponement of some maintenance each year.  As a result, the FY 2007-08 proposal for spending $912,300 above the amount required for currently financed capital projects still requires the postponement of a number of projects. Projections show the need for annual contributions to capital projects in amounts ranging from $2.5 million to $5.6 million, over each of the next five years.  The proposals for funding in future years exclude costs for any projects currently proposed for 2007-08 which the Council might wish to defer because of budgetary constraints.  Postponements would therefore increase the funding needs in future years.

 

DISCUSSION

 

The items presented to Council for consideration in the Capital Improvements Fund budget generally fall into three categories: (1) contractual obligations ($689,900); (2) consistently funded CIP items (e.g. extraordinary maintenance, small park improvements, etc.) ($296,000); and (3) other recommended priority additions to the CIP ($646,500).  Many worthy items were considered beyond those recommended, but out of necessity to restrain the budget, these items were deferred to later years.  We anticipate that some items, which appeared as proposals on the Status Report have been, or may yet be, adjusted, reduced or eliminated from the recommendations for FY 2007-08 funding.

 

This document will focus on the recommended additions to the CIP for the 2007-08 budget and will provide background information and description of their cost factors. 

 

Contractual Obligations

 

Contractual obligations total $689,900 and include improvements that have been financed previously, for example, improvements to the Community Center.

 

Consistently Funded Maintenance

 

Consistently funded maintenance items total $296,000 and allow the Town to attend to greenways, bikeways and other maintenance requirements annually, to prevent deterioration of Town assets.

 

Other Recommended Priority Additions

 

Other recommended priority additions include maintenance improvements that do not require annual funding.  This year, a majority of the funding requests include exterior painting for buildings.  If we do not protect the building exteriors by painting, we anticipate the need for more costly repairs caused by damage to building exteriors.

 

Safety Concerns- Light Poles

 

Two of the recommended CIP projects are recommended out of concern for the safety of citizens and staff.  The first of these is athletic field and tennis court light pole replacement.  These poles were originally installed in the mid-1970s and currently have significant decay problems.  We are concerned that many of the poles have reached a stage where the creosote protected underground portion of the poles has deteriorated, and that the poles are in danger of falling.

 

We recommend replacing aging athletic field and tennis court light poles, fixtures, and control boxes in order to increase energy efficiency and to reduce the chance that a pole may collapse during park use.  This proposal would replace poles with steel poles and metal halide fixtures.  The request to replace all troublesome lights would cost $572,000 over and above the $193,000 we have recommended.  Due to budgetary constraints, we recommend that replacement of the most decayed poles take place within the $193,000 amount, but because of the safety concerns with decaying poles, the remaining poles must be replaced in the near future as well.

 

Replacement should have a positive impact on the operating budget, as the new fixtures will be more energy efficient, and routine maintenance costs should be reduced, because the equipment will be new.

 

Safety Concerns- Fire Stations

 

The second major safety concern is in one of our fire stations.  Four of the Town’s five fire stations were built more than 25 years ago.  These stations are all in need of major repairs.  We recommend making the repairs over a number of years, because of the costs. 

 

We had planned to begin with repairs to Fire Station #2 in the current year.  However, because of the pressing needs at Fire Station #3, we propose redirecting a portion of the funding for Fire Station #2 to Fire Station #3. By redirecting the funding, repairs can be made to Fire Station #3 without incurring additional costs in 2007-08.

 

Fire Station #3 was built on a spring.  There are significant problems with walls separating and doors not closing properly.  Even if the Town ultimately decides to rebuild Fire Station #3, a number of repairs need to be made at this time so that it can continue to be used as a fire station. 

 

Fire Station #3 Capital Maintenance includes resolving the drainage issue, replacing the storefront door and frame (Franklin Street side), replacing the storefront door and frame (west side hall), renovating bathroom plumbing, and building an addition to the station, to increase dorm space to accommodate the increase in personnel.

 

The storefront door on the Franklin Street side does not close properly. A settling and rising of the station from the drainage issue, has damaged the door over time, along with the frame.  The storefront door at the hall also needs replacing, as it is rusting and disintegrating.

 

The bathroom plumbing needs major renovations.  Some problems were alleviated by having a pressure-reducing valve installed to reduce the water pressure coming into the station, but the age and condition of the plumbing requires renovation.

 

Fire Station #3 rises and falls as the water table increases or decreases under the station, which apparently was built on a spring.  The walls are separating at the corners, and daylight can be seen coming through.  The bay doors routinely go off track (get in a bind and break, requiring door replacement), as the building shifts.  Also, the constant moisture with possible mold in the station has created a toxic atmosphere for the crews, many of whom complain of respiratory issues while stationed there.  In the day room the wall separates from the floor during the building shifting, allowing a one and a half inch gap at the floor.  There is great concern for the structural integrity of the building.  Finally, with the addition of six firefighters at Station #3, we need to provide additional dormitory space so that there are sufficient accommodations for staff overnight.

 

By reallocating funds between Fire Station #2 and #3, we can make the most pressing repairs after Fire Station #3 has been evaluated for structural integrity.  If the department continues to operate this building in the short-term, with the intent to move into a new facility within a few years, that will necessitate a different prioritization of repairs and maintenance than would a plan to stay in the building indefinitely. 

 

Discussion of Other Recommended Priority Additions

 

A more detailed discussion of proposed CIP projects by facility has been provided for the following projects:

 

Hargraves Recreation Center Capital Maintenance

This project provides funding for periodic scheduled capital maintenance including exterior and interior paint.

 

Recommended components:

A.D. Clark Pool Capital Maintenance

This project allows for locating and repairing a chronic pool leak and periodic scheduled capital maintenance including exterior and interior paint. A portion of this scheduled maintenance has been delayed due to budget constraints, including winterizing the bathhouse and pump room, and repairing the pool ramp and sidewalks, which would total an additional $34,000.

 

Recommended components:

Locate & repair source of pool leak

$50,000

Clean/paint exterior walls throughout

6,500

 

$56,500

 

Police Department HQ Capital Maintenance

This project provides funding for periodic scheduled capital maintenance including painting the exterior and interior, and replacing main entrance doors with ADA-compliant mechanisms.  Due to budget constraints, we recommend delaying replacement of some floor coverings, which would total an additional $32,000.

 

Recommended components:

Town Hall & Council Chamber Capital Improvements

The scheduled maintenance request is estimated at $271,500 for the combined items listed below.  In the interest of budget constraints we have recommended funding this item at $150,000, and are requesting that Public Works prioritize the maintenance within that budget; some requested items will necessarily be delayed.

 

We are also recommending $50,000 to fund design work for upgrades to the Council Chambers.  Such work could include technology upgrades, furniture replacement and handicapped accessibility.

 

Parks Maintenance Assessment

While not included in the Budget Status Report, we request $30,000 for a contract to assess routine maintenance needs, as well as replacement schedules and renovation needs.  A separate Budget Working Paper is included for the April 18 meeting, which discusses issues related to parks maintenance in more detail.

 

Streets - Infrastructure Improvements

At the time of the presentation of the Status Report, we recommended applying $100,000 towards Streets–frastructure Improvements; however,in light of the current budget constraints we have removed this recommendation.

 

PROPOSAL

 

That the Council approve the requested funding to assist the capital projects discussed above.

 

ATTACHMENT

 

1.        CIP Fund 15 year plan (p. 6).