AGENDA #1b
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Preliminary Report on the 2004-2019 Capital Improvements Program
DATE: March 24, 2004
The attached resolution would refer the Preliminary Report on the 2004-2019 Capital Improvements Program to the Town’s Bicycle and Pedestrian Advisory Board, Community Design Commission, Greenways Commission, Historic District Commission, Housing and Community Development Advisory Board, Library Board, Parks and Recreation Commission, Planning Board, Public Arts Commission, and Transportation Board for their review and recommendations. Recommendations from these advisory boards would be included in the Council’s materials for the May 12, 2004 public hearing.
INTRODUCTION
The presentation of this preliminary report is one of the initial steps in the Council’s annual adoption of a 15-year capital spending plan. The schedule for adoption of the 2004-2019 Capital Improvements Program includes the presentation of the Town Manager’s recommendation on April 26, 2004, and Council consideration on June 14, 2004.
DISCUSSION
The Capital Improvements Program is a 15-year financial plan for the Town’s major capital and infrastructure needs. The Capital Improvements Program identifies capital needs, establishes priorities, identifies potential funding sources, and includes needs for which sources of funding have not been identified. Key sources for identifying capital needs include the 2000 Facility Condition Assessment, the Library Master Plan, the Parks and Recreation Master Plan, the Greenways Master Plan, special studies, the Comprehensive Plan, and ideas from the Council, citizens, and staff.
The Capital Improvements Program is comprehensive in scope. It includes all identified capital projects and a range of funding sources, as well as, projects that have been identified but for which funding is not available. It includes projects that are funded through the Town’s Capital Improvements Fund, and also those projects that are funded through bonds, State and federal grants, and other sources. The Capital Improvements Program does not include all of the capital projects in the community – such as the capital needs of the Chapel Hill-Carrboro City School System, the Orange Water and Sewer Authority, or the Orange Regional Landfill, which was transferred to Orange County in 2000. Projects in the Transportation Improvement Plan also are not listed in the Capital Improvements Program, except where a local match is required.
The Preliminary Capital Improvements Program was developed using a set of priority ranking criteria to evaluate projects (please see Attachment 1).
Table 1 is a list of projects proposed for funding or identified for funding using the Capital Improvements Fund, which generally is funded by annual transfers from the Town’s General Fund.
Table 2 includes projects for which grant or other funds will be used.
Table 3 lists capital project requests for which funding has not been identified.
The 1996 and 2003 bond projects are discussed in a separate section, below. Most of the funds from the 1996 bonds have been spent. The Council is scheduled to discuss the 2003 bonds at a work session on March 30.
HIGHLIGHTS
2004-05 Capital Improvements Fund Budget
The Preliminary Capital Improvements Program proposes a $1.659 million Capital Improvements Fund budget for 2004-05. We have reduced the 2004-05 projection for the Capital Improvements Fund of $1.709 million by $50,000, the projected amount for sidewalks and bicycle facilities. We recommend applying those funds to debt service associated with sidewalks and bicycle facility bonds.
New Projects Proposed for Funding in 2004-05
New capital projects proposed for funding in Fiscal Year 2004-05 include:
Replacement of the Heating, Ventilation and Air Conditioning (HVAC) units at Town Hall. The $300,000 project would replace the rooftop HVAC units, installed in 1990, with new, more efficient units. The project will enable the Town to achieve energy savings and reduce maintenance costs. The project also would include the installation of controls in each of the 55 zones at Town Hall, a computerized control system and other features which would help manage energy use throughout the building.
We will attempt to quantify the energy savings resulting from the project and set aside this amount for use in future energy efficiency improvements at Town facilities as part of the Town’s efforts to implement an “energy bank” concept.
Renovation of the Chapel Hill Community Center. The $1.6 million installment financing project would begin in 2004-05. This would enable the Town to start work one year earlier than currently anticipated, as shown in the projected funding schedule in the 2003-18 Capital Improvements Program. The work would include capital maintenance and building improvements, including the addition of HVAC for the gymnasium and new office spaces.
In order to fund the Community Center project, we propose postponing the full renovation of the Old Post Office building until 2007-08. The Town would address immediate needs in 2004-05 at the Old Post Office by repairing the roof and chimney, estimated to cost $130,000. The remainder of the work mostly involves interior renovations and could be delayed.
Repairs to the outside wall at Fire Station Number 4. The $435,000 project is needed to address a water intrusion problem at the fire station at 1695 Airport Road. The work would involve the removal of dirt from the exterior walls and other improvements at the site.
Replacement of the Bolinwood Drive Bridge. The proposed $620,000 debt-financed project would replace the Bolinwood Drive Bridge at Bolin Creek, which is nearing the end of its service life. This is the last of 4 bridges planned for replacement.
Replacement of the telephone system at Town Hall. The $100,000 project would replace the failing current system which is inadequate to meet the needs at Town Hall.
Key Ongoing Projects
Other major projects include the development of the Town Operations Center, the Aquatics Center and Southern Community Park.
Two other projects identified for funding in the current Capital Improvements Program are larger in scope than previously contemplated. Generators for Town Hall and the Police Headquarters are currently estimated to cost $340,000 and $185,000 respectively. We propose financing both generators with 10-year installment debt. These generators are needed to provide emergency backup power to key Town facilities.
Bonds
The bonds approved by voters in November 2003 total $29.36 million, for use on a variety of projects including sidewalk improvements, greenway construction, open space purchases, library expansion, and energy efficiency improvements at Town facilities. The Council will be holding a work session on the 2003 bonds on March 30, 2004.
PROJECTS PROPOSED FOR FUNDING IN FISCAL YEAR 2004-05
Projects proposed for reappropriated unspent funds and new funding in the 2004-05 fiscal year are described below. The project numbers are the same as the project reference numbers in Table 1, attached.
Contractual Obligations
Projects identified for Capital Improvements Fund funding in 2004-05 include six that are under contract (these are shown in bold in Table 1):
1. Town Operations Center - Land Acquisition Installment Debt Payments, $122,000. This amount represents an annual payment on 10-year installment debt principal of $870,000. Funding is for the purchase of land for the Town Operations Center.
14. Roof Replacements - Town Hall, Fire Station # 2 & Fire Station # 3 - Installment Payments, $38,000. This amount will be the first annual payment on 10-year installment debt principal of $265,000. The actual total project cost is $310,000. We propose using $45,000 in unspent funds previously budgeted for the project to cover the difference between the amount borrowed and the project cost.
22. IFC Shelter: Exterior Capital Repairs - Installment Debt Payments, $58,000 (reappropriated funds). The $450,000 10-year installment debt principal includes a number of exterior repairs, including roof repairs and replacement of windows, needs identified in the 2000 Facility Condition Assessment. Initial engineering work has been completed; the contract was to be awarded on Monday, March 22. The Council included funding for this project in the 2003-04 Capital Improvements Program. Reappropriated unspent funds totaling $58,000 in 2003-04 would be used for the first annual payment in 2004-05.
24. Museum Roof: Capital Repairs - Installment Debt Payments, $9,000 (reappropriation of unspent funds). This amount represents an annual payment on 10-year installment debt principal amount of $60,000. Reappropriated unspent funds totaling $9,000 budgeted for the project in 2003-04 would be used for the first annual payment in 2004-05.
43. Tennis and Basketball Courts: Capital Repairs – Installment Debt Payments, $32,000 (reappropriation of unspent funds). This amount represents the first annual payment on 10-year installment debt principal of $240,000. Reappropriated unspent funds totaling $32,000 budgeted for the project in 2003-04 would be used for the first annual payment in 2004-05.
52. Meadowmont School Gym Payments - $238,000. This is the Town’s final payment as part of an agreement with the school system giving the Town access to the gym at the Rashkis Elementary School at Meadowmont.
55. Hargraves Center/A.D. Clark Pool Capital Repairs - Installment Debt Payments, $163,000. This is an annual payment on 10-year installment debt principal of $1,200,000 related to the renovation of Hargraves Center and the A.D. Clark pool facility.
Council-Approved Projects
19. Generator for Police Headquarters - Installment Payments, $5,000 plus $23,000 reappropriated funds. Unspent funds budgeted for the project in 2003-04 would be used to help pay the first of 10 annual installment financing payments for purchasing the generator. The Town’s new cost estimate of $185,000 is higher than the original $100,000 estimate. The increase in price is due in part to the unanticipated expenses of using natural gas to fuel the unit, a special enclosure to mitigate noise associated with operation of the unit and the civil engineering costs for locating the generator so as to comply with the Town’s Land Use Management Ordinance.
20. Generator for Town Hall - Installment Payments, $21,000 plus $30,000 reappropriated funds. The Council included funding for the project in 2003-04. The amount proposed for 2004-05 would be added to reappropriated unspent funds budgeted for the project in 2003-04 to pay for the first of 10 annual installment debt payments. Annual payments would begin at $51,000 and decline over the period, with the final payment of $31,000 in 2013-14. The generator is estimated to cost $340,000, which is higher than the previous estimate of $120,000. The increase is due to the same factors that also have raised the estimated cost of the Police Headquarters generator.
27. Old Post Office Capital Repairs - Roof and Other Exterior Work, $130,000 (reappropriation). The funds would pay for the roof repairs needed at the building. The Council originally budgeted $225,000 in 2003-04 for the first of 10 annual installment payments on a proposed $1.5 million renovation project. The Preliminary 2004-19 Capital Improvements Program proposes to address repairs to the roof and chimney that are needed now and postpone the remainder of the renovations to 2007-08. By delaying the project, the Town would be able to begin the renovations of the Chapel Hill Community Center in 2004-05, a $1.6 million installment financing project.
29. Railroad Crossing Improvements, $9,000 (reappropriation). The funds are needed in the cost-share project with the State to upgrade traffic warning/control devices on Cameron Avenue at Merritt Mill Road.
51. Meadowmont Park Picnic Shelter, $25,000. This project would add a picnic shelter as required by the park special use permit approved by the Council. The project would include an American Disabilities Act-accessible path and site furniture. The project is proposed for funding in FY 2004-05 in order to allow enough time to complete the project and comply with the requirements of the special use permit.
Other Identified Needs
The Preliminary Capital Improvements Program proposes funding the following projects which will address key capital needs, including facility maintenance, infrastructure repairs and improvements, and replacement of outdated equipment.
3. Extraordinary Maintenance, Emergency Repairs, $78,000. This item would provide funding enabling the Town to do a variety of relatively small unanticipated, emergency repairs such as a failing roof or storm damage.
8. Fire Station # 4: Outside Wall Repair and Refurbishment - Installment Debt Payments, $65,000. The funding would pay for the first annual payment on this proposed 10-year installment debt project principal of $435,000. This project would fund the design and construction needed to remove the dirt from the exterior walls in order to solve a water intrusion problem.
11. Parks and Recreation Administration Capital Maintenance, $19,000. The following projects identified in the Facility Condition Assessment would be completed at the Parks and Recreation Administration Building at Plant Road: replace interior doors, the overhead bay door, and cabinets and countertops.
17. Replacement of Town Hall HVAC Units, $300,000. The project would replace the rooftop HVAC units at Town Hall. The Town would achieve energy savings and reduction in maintenance costs by replacing the current units, which were installed in 1990, with new, more efficient units. The project also would include the installation of controls in each of the 55 zones at Town Hall, a computer control system and other features which would help manage energy use throughout the building.
28. Bolinwood Drive Bridge Replacement - Installment Debt Payments, $93,000. The proposed 10-year installment debt project principal of $620,000 would replace the Bolinwood Drive Bridge at Bolin Creek.
30. Weaver Dairy Road and Sedgefield Road Improvements (Town Share), $15,000. At the Town’s request, the State has agreed to provide funds for construction of a left-turn lane on northbound Weaver Dairy Road at its intersection with Sedgefield Road. State funding for this project does not include costs for right-of-way acquisition and/or utility relocation that may be necessary for construction of a turn lane on Weaver Dairy Road. The right of way acquisition and utility relocation costs associated with this project are estimated to be $15,000. The State will not proceed with construction unless the Town agrees to pay for necessary right of way acquisition and utility relocation.
32. Curb and Gutter Replacement / Improvements, $25,000. Funding would help repair Town infrastructure failures. The Town has previously replaced various sections of curb and gutter, driveway aprons and performed other incidental work throughout Town.
33. Curb Repairs: ADA Compliance, $25,000. Approximately 70 locations still need access ramps in order to meet Americans with Disabilities Act standards.
36. Capital Repairs - Bike Paths, Paved Trails and Public Parking Areas, $50,000. Funds would pay for repair and maintenance to existing paved pedestrian paths, trails and parking lots.
37. Small Park Improvements, $50,000. These projects would provide for improvements, repairs and replacement of equipment in Town parks. Funds would provide for improvements, repairs and replacement of equipment in Town parks. Examples of potential projects for 2004-05 include bleacher replacements at Hargraves and Umstead; initial replacement of playground equipment at Cedar Falls Park; and turf renovation at the Homestead Park athletic fields.
41. Replacement of Town Hall Telephone System, $100,000. The Town Hall telephone system has limited capability to provide capacity and features needed to serve users at Town Hall. In addition, repair parts are becoming increasingly difficult to acquire for the current system. A system upgrade or replacement will be necessary to support future telephone system requirements and future compatibility with the new Town Operations Center system.
46. Community Center Capital Repairs – Installment Debt Payments, $240,000 total: $104,000 (reappropriation), $136,000 (new appropriation in 2004-05). The principal amount of $1.6 million includes funding for repairs and building improvements, including the addition of HVAC for the gymnasium, new office spaces and a new lighted flag pole.
48. Homestead Park, $21,000. This would complete the park work including new timers on field lights, replacement bollards, dog park improvements, and replacement turf in common areas.
54. Cemetery Beautification, $10,000. Funding would help continue maintenance efforts, consistent with the adopted Old Chapel Hill Cemetery Master Plan.
57. Greenways, $60,000. Major repairs anticipated for various projects including Tanyard Branch, Bolin Creek, and Dry Creek Trails. Long range plans include ongoing repairs and new trail construction. The amount of funding represents the Town’s annual revenues received from cell tower leases, which the Council in the past has earmarked for greenways projects.
OTHER FUNDS: 2004-05 PROJECTS
Following are projects for which we anticipate using funding sources in 2004-2005 other than the Capital Improvements Fund and the Town’s 1996 and 2003 Bonds (see Table 2). The project numbers correspond with the reference numbers in Table 2.
Development of the Town Operations Center
60. Town Operations Center -Development of Public Works Facility, $24.5 million. We anticipate needing to borrow the balance of the funds for the Town Operations Center in January or February of 2005. The Public Works complex will require about $24.5 million in funding.
61. Town Operations Center - Transit Facility, $19 million. The Transportation Operations Center will require about $19 million in funding. The Transportation facility debt will also need to be repaid beginning in fiscal year 2005-06. The Town expects to receive grants from both the federal and State governments to help cover as much as 90 percent of the total cost of the facility; however, the exact amount and the timing of the receipt of the federal and State funds is uncertain. The project will require a 10 percent local match.
Other Projects
62. Wallace Parking Facility Capital Maintenance, $76,000 (Parking Fund). The funding would enable the Town to address needs identified in the 2000 Facility Condition Assessment, including concrete repairs, irrigation system repairs, and the design and installation of an upper deck sub-grade drainage system.
64. Comprehensive Public Housing Renovations, $604,000 (Capital Fund Program and Community Development Block Grant Program). The funding would pay for work identified in the Council-approved five-year plan for improving public housing apartments.
65. Weaver Dairy Road Bicycle and Pedestrian Facilities Improvements, $566,000 (Surface Transportation Program – Direct Allocation). The State typically does not pay for the construction of new sidewalks as part of its roadway improvement projects. The approved Weaver Dairy Road Improvement Project includes the construction of sidewalk on both sides of the road. The preliminary estimate of the cost of the sidewalk construction is $708,000. The Town has secured $566,000 in Direct Allocation funding through the Municipal Planning Organization to for sidewalk construction costs on Weaver Dairy Road. The remaining $142,000 is the 20% local match required for use of Direct Allocation funds. Town bond funds in the amount of $180,000 are being held in reserve until such time as the exact costs are determined for the Town share of Weaver Dairy Road sidewalk construction.
66. Stormwater Utility Capital Fund, $250,000. This is the potential allocation of the proposed stormwater utility for capital projects, such as the remediation and repair of drainage infrastructure, which could include replacing or repairing culverts under streets, repairing streams, clearing debris from streams, and emergency repairs.
68. Library Automation System Upgrade, $161,000 (Library Gift Funds). The funding would pay for new and upgraded hardware, upgraded vendor software, and added catalog features. The Library Master Plan, which included this Technology Plan project, was adopted by the Council in April 2003.
69. Library Internet Access Improvements, $16,000 (Library Gift Funds). The funding would be used on a project to expand the public computer lab, provide on-line reference service and improve wiring in the facility.
71. Park/Ride Lot Security Equipment, $100,000 (State and federal grants, Transit Capital Reserve Fund). Federal and State grants and local matching funds would be used for security equipment at Town park and ride lots.
72. Aquatics Center, $4.355 million (1997, 2001 Orange Co. Parks Bonds). This project would result in the construction of a new aquatics center at Homestead Park. The facilities would include a 25 yard by 25 meter competitive pool, a 25 by 10 meter warm-water pool, a deck with bleachers, locker rooms, and office/classroom space. This project would use a combination of $855,000 in 1997 Orange County Parks Bonds, and $3,500,000 in 2001 Orange County Parks Bonds. In addition, the project would use $1,158,000 in 1996 Parks Bonds.
73. Southern Community Park, $1.742 million (1997 and 2001 Orange County Bonds). The Council has adopted a conceptual plan for the park that includes three athletic/soccer fields, youth baseball field, play areas, picnic facilities, trails, and courts. The project would be a cooperative venture with Orange County.
74. Cedar Falls Park Play Area, $52,000 (Payment in Lieu of Recreation Area (Cross Creek Subdivision)). This project would result in the replacement of the Cedar Falls Play Area. The current play structure in almost 30 years old and is no longer in compliance with national safety standards. The project would include all site preparation and installation of new equipment. This project would use a payment in lieu of recreation area from the Cross Creek subdivision property.
75. South Estes Drive Community Center Park - Capital Repairs, $20,000 (Payment in Lieu of Recreation Area (Wilshire Place)). This project involves the renovation of existing features of Community Center Park including the play area retaining wall, poured-in-place playground surface, paths, signs, and turf.
76. Carolina Sport Art Building and Grounds, $14,000 (lease payments). This project would result in the capital repair and renovation of the Town-owned Carolina Sport Art building and grounds located on Homestead Road. Repairs could include roof repair, drainage improvements, ventilation, septic repairs and other repairs.
77. Greenways – Orange County Bond Projects, $100,000 (2001 County Bonds – Parks). Orange County funds could pay for either the Bolin Creek and/or Morgan Creek Trails. Funds would be restricted to projects that would link Carrboro and Chapel Hill.
78. Upper Booker Creek Trail, $10,000 (payment from developer). These funds already paid by the Parkside II developer would be allocated for the greenway trail segment from Homestead Park to Weaver Dairy Road with an extension to Homestead Road.
UNFUNDED PROJECTS
Capital project requests for which funding has not been identified are included in Table 3.
BOND PROJECTS
2003 Bonds
In November 2003, voters approved $29.36 million in bonds for a variety of projects. The Council will be holding a work session on the 2003 bonds on March 30, 2004.
Bond projects are assigned to five individual categories as follows:
$5,600,000 for Sidewalk and Street Improvement Bonds
$5,000,000 for Parks & Recreation Bonds
$2,000,000 for Open Space Bonds
$500,000 for Public Building Bonds
$16,260,000 for the Library.
While the Council has not decided on the bond sale schedule yet, we anticipate funding from the 2003 bonds will be available beginning in 2004-05 for sidewalks and bicycle facility projects. Because of this, the proposal shows no funding from the Capital Improvements Fund for these projects in 2004-05 and several years into the future.
1996 Bonds
Most of the $13.5 million from the 1996 bonds has been spent or encumbered for capital projects. One of the remaining projects requiring the use of 1996 bonds is the development of the Homestead Aquatics Center. This project would use $1,158,000 in 1996 Town Parks bonds along with $855,000 in 1997 Orange Co Parks bonds, and $3,500,000 in 2001 Orange Co Parks bonds.
Other 1996 bond projects included development of Homestead Park, renovations of the Hargraves Gym, renovations at the Police Department headquarters, open space purchases, construction of Fire Station Number 5 and purchase of a fire truck, public works facility site development, downtown streetscape projects, curb and gutter improvements, bridge replacement projects, and installation of sidewalks and bicycle facilities.
PUBLIC FORUM COMMENTS
On February 2, 2004, the Council held a public forum on the budget and capital program needs. At that time, the Council received comments from the Greenways Commission, Historic District Commission, Library Board, and Parks and Recreation Commission. Two additional advisory boards have submitted comments since that public forum. Please see Attachment 2 for recommendations from the Community Design Commission and the Bicycle and Pedestrian Advisory Board. After an initial review in January, the Planning Board elected not to submit additional comments at this time.
FUTURE STEPS
The Manager’s Recommended Capital Improvements Program will be submitted to the Council on Monday, April 26, 2004. On Wednesday, May 12, 2004, a public hearing will be held to receive citizen comments on the Recommended Capital Improvements Program. The Town Council is scheduled to consider adopting the Budget and Capital Improvements Program on Monday, June 14, 2004.
We recommend the Council adopt the attached resolution referring this document to Town advisory boards.
ATTACHMENTS
Priorities for Selecting Projects for Capital Improvements Funding (p. 13).
Additional Advisory Board Comments (p. 14).
Summary of Community Design Commission Action, February 4, 2004
Summary of Bicycle and Pedestrian Advisory Board Action, February 10, 2004
Table 1: Proposed Capital Improvements Fund Projects (p. 17).
Table 2: Other Sources (p. 21).
Table 3: Unfunded Projects (p. 23).
A RESOLUTION REFERRING THE PRELIMINARY REPORT ON THE CAPITAL IMPROVEMENTS PROGRAM (2004-03-24/R-1)
WHEREAS, the Council of the Town of Chapel Hill has received a Preliminary Report on developing a 2004-2019 Capital Improvements Program;
NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council hereby refers the Preliminary Report for comment and recommendations to the following advisory boards:
Bicycle and Pedestrian Advisory Board;
Community Design Commission;
Greenways Commission;
Historic District Commission;
Housing and Community Development Advisory Board;
Library Board;
Parks and Recreation Commission;
Planning Board;
Public Arts Commission; and
Transportation Board.
BE IT FURTHER RESOLVED that the Council requests that the advisory boards complete their review and recommendations for consideration at the Council Public Hearing on Wednesday, May 12, 2004, regarding the Budget and Capital Improvements Program.
This the 24th day of March, 2004.