AGENDA #1b
MEMORANDUM
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Preliminary Report on the 2003-2018 Capital Improvements Program
DATE: March 26, 2003
The attached resolution would refer the Preliminary Report on the 2003-2018 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 14, 2003 public hearing.
INTRODUCTION
The presentation of this preliminary report is the first of several steps in the Council’s annual adoption of a 15-year capital spending plan. At this stage, we outline three options—Scenarios A, B and C—to illustrate a range of potential capital expenditures for the 2003-2004 fiscal year.
The schedule for adoption of the 2003-2018 Capital Improvements Program includes the presentation of the Town Manager’s recommendation on April 28, 2003, and Council consideration on June 9, 2003.
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, 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. However, the Capital Improvements Program does not include 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.
The Preliminary Capital Improvements Program was developed using a set of priority ranking criteria to evaluate projects (please see Attachment 1).
Projects funded or identified for funding using the Capital Improvements Fund are listed in Tables 1-A, 1-B and 1-C. The Capital Improvements Fund generally is funded by annual transfers from the Town’s General Fund.
In addition, the program includes projects identified as candidates for future debt financing (please see Table 2), and projects for which grant or other funds will be used (please see Table 3). Unfunded projects are listed in Table 4.
FISCAL YEAR 2003-2004 SCENARIOS
For the 2003-2004 fiscal year we show three funding scenarios.
· Scenario A (Table 1A) is the bare minimum 2003-2004 capital budget, covering just those projects for which the Town is under contractual obligations to fund.
· Scenario B (Table 1B) is based on the $1.438 million Capital Improvements Fund capital program forecast in the 2002-2003 Budget
· Scenario C (Table 1C) illustrates a potential 2003-2004 CIP budget totaling $2 million.
Please see Attachment 2 for a comparison of the scenarios and an explanation as to why each project was selected for potential funding in 2003-2004. Please see Attachment 3 for descriptions of Long Range Projects identified for funding in years after 2003-2004.
Scenario A: Contractual Obligations Only
Scenario A includes Capital Improvements Fund funding in 2003-2004 for five projects under contract (please see Table 1-A). Except for payments on the two installment debt projects, this scenario would allocate no Capital Improvements Fund resources for the maintenance of Town buildings and none to parks. In addition, no funding would be provided for the construction of new sidewalks, greenways or bicycle facilities in 2003-2004.
The contractual obligations in 2003-2004 total $576,000. Currently these Capital Improvements Fund projects are under contract:
· Site purchase for Town Operations Center, $126,000. This amount represents an annual payment on 10-year installment debt on the purchase.
· Roof repairs at the Chapel Hill Museum, $9,000. This amount represents an annual payment on 10-year installment debt.
· Infrared rescue cameras purchase, $28,000. This is the final annual payment on the contract.
· Capital repairs at the A.D. Clark Pool/Hargraves Center, $175,000. This is the second annual payment on 10-year installment).
· Payment to the Chapel Hill-Carrboro school system, $238,000. This payment is part of an agreement with the school system giving the Town access to the gym at the Rashkis Elementary School at Meadowmont.
Scenario B: $1.438 Million
The 2002-2003 Town Budget forecasts a $1.438 million Capital Improvements Fund capital budget for 2003-2004 (please see Table 1-B). Scenario B proposes a Capital Improvements Fund budget that meets this forecast.
Following are projects in Scenario B proposed for funding in 2003-2004, in addition to contractual obligations.
Council-Approved Projects
· Payment on installment debt financing for Town Hall generator, $30,000. The Council included funding for the five-year installment in the 2002-2003 Budget. The Town is preparing specifications, but has not yet contracted to purchase the generator, estimated to cost $120,000.
· A payment on installment debt financing for a Police Department generator, $23,000. The Council included funding for the five-year installment in the 2002-2003 Budget. The Town has not yet contracted to purchase the generator, estimated to cost $100,000. The intention is to finance this and the Town Hall generator in one installment contract.
· Installment debt payment for repairs at the Inter-Faith Council Shelter, $65,000. The $450,000 10-year installment debt project includes roof repairs and an overhaul of the HVAC system, needs identified in the 2000 Facility Condition Assessment. Initial engineering work completed, but roofing contract not yet let.
Other Identified Needs
· Extraordinary maintenance at Town facilities, $68,000. 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.
· Installment debt payment for roof repairs at Town Hall and Fire Stations Number 2 and 3, $45,000. The 10-year installment debt project would enable the Town to undertake three major roof projects identified by Public Works. Roof maintenance helps to prevents water damage within the buildings.
· Installment debt payment for repairs at the Post Office/Courthouse, $225,000. The $1.5 million 10-year installment debt project would be used for exterior repairs identified in the 2000 Facility Condition Assessment.
· Infrastructure improvements enhancing access for citizens with disabilities, $25,000. Approximately 70 locations still need access ramps in order to meet Americans with Disabilities Act standards.
· Sidewalk and Bicycle Facilities Improvements, $100,000. Sidewalk construction is based on sidewalk priority system established by the Town Council.
· Extraordinary Maintenance—Infrastructure, $15,000. Funding would help repair Town infrastructure failures. Recent past examples include drainage/sidewalk failure on McCauley Street ($14,500) and guardrail repairs for which insurance reimbursement was not available ($10,000).
· Small Park Improvements, $50,000. These projects would provide for improvements, repairs and replacement of equipment in Town parks. Examples of possible projects for 2003-2004 include replacement of fall surfaces at Hargraves and Oakwood play areas, repair of erosion problems at Cedar Falls and Hargraves, turf renovation/irrigation at Culbreth, move the Umstead Park playground, replacement/addition of interior park signs, installation of chain link fence at Homestead soccer fields, and initiation of playground replacement at Cedar Falls.
· Update Town-Wide Aerial Photography, $30,000. Town-wide aerial mapping photography needs to be kept up to date. Project would allow mapping of specified areas based on photography flowin in spring 2003.
· Traffic Signal System Upgrade (Town share), $90,000. Project scheduled for funding by State in 2003-2004: $360,000 MPO Direct Allocation, and $2.55 million in State Transportation Improvement Program funds. Town’s share of cost is approximately $90,000. Project would replace the copper communications cable and existing traffic controllers with fiber optic cable and new controllers. In addition, project would upgrade the signal system software and install cameras for traffic monitoring.
· Greenways, $55,000. 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.
· Tennis and Basketball Courts Capital Repairs—Installment Debt Payments, $41,000. 10-year installment financing would raise $300,000 for repairs. Major repairs would be made to tennis and basketball courts at Cedar Falls, Community Center, Hargraves, Umstead, Homestead, and Oakwood Parks.
Scenario C: $2 Million
Scenario C includes all projects in Scenarios A and B. Additional funding is provided for several projects in Scenario B; an increased funding level also would provide the opportunity for additional projects (please see Table 1-C). These are described below.
Projects with Increased Funding Compared with Scenario B
· Extraordinary Maintenance, $125,000
· Sidewalk And Bicycle Facilities, $225,000
· Extraordinary Maintenance—Infrastructure, $85,000
· Small Park Improvements, $50,000
· Greenways, $125,000
Additional Projects
· Town Hall Carpet Replacement, $135,000. Replacement of 13-year old carpet at Town Hall.
· Fire Training Facilities Capital Improvement Project, $45,000. Council approved funding in 2002-2003 for installation of heat shielding tiles on first floor. This funding would install heat shielding tiles on second floor.
· Cemetery Beautification, $10,000. Funding would help continue maintenance efforts, consistent with the adopted Old Chapel Hill Cemetery Master Plan and the Cemetery’s listing on the National Register of Historic Places.
FUTURE DEBT FINANCING
At least two projects are too large to consider building without long-term debt. Not only can long-term debt be a good financial tool, but it can also serve an equitable public policy. The public facilities proposed to be financed, in this case a town operations center and a public library, would benefit taxpayers for decades to come. It seems only equitable for those future tax payers to share in the cost of the facilities that they will enjoy.
Future debt financing projects are described below. Annual debt service payments for these projects are illustrated in Table 2.
Town Operations Center
We do not know the cost of the operations center that will accommodate the Transportation, Public Works and Engineering Departments and the Housing Maintenance Division. The current preliminary planning and design project is intended to have initial cost projections by June, 2003, and the Council should be able to make a decision on a budget by August 25, 2003. Based on general information from other jurisdictions, we own estimate costs will be about $15,120,000 for design and construction of the transit operations center and about $16,300,000 for design and construction of the non-transit facilities .
We are assuming one integrated site plan and one integrated construction process, even though we will be separating the costs by transit and non-transit categories. The transit facilities are eligible for up to 80% federal funding and up to 10% funding. Local funds will be needed for at least 10% of the transit facilities and for all of the public works and engineering facilities. Federal funds may be available for some or all of the housing maintenance capital costs, estimated to be about 5–6% of total costs.
Please see Attachment 7 for a more detailed discussion of funding for the transit operations facilities.
Library Expansion
Expansion of the Library would cost an estimated $14.5 million. The schedule shown in Table 2 proposes selling the bonds in 2003-2004, with debt service payments starting in 2004-2005. This schedule would enable design to begin in 2003-2004 and construction to start after completion of architectural and engineering work, probably in 2005-2006.
OTHER FUNDS: 2003-04 PROJECTS
Following are projects for which we anticipate using funding sources in 2003-2004 other than the Capital Improvements Fund and the Town’s 1996 Bonds (please see Table 3).
· Town Operations Center Transit Facility—Transportation, estimated $15 million Capital Reserve Fund. Project includes complete site development work to prepare for site work and construction. Funding level reflects the Town’s share in the project.
· U.S. 15-501 Park-Ride Lot, $160,000, Transportation Capital Reserve Fund.
· Traffic Signal System Upgrade, $360,000 MPO Direct Allocation, and $2.55 million in-State Transportation Improvement Program funds. Town’s share of cost is approximately $90,000.
· Library Automation System Replacement, $104,000, Library Gift Funds. Project would upgrade existing 12-year-old automation system to current vendor’s newer graphics-based system. Project costs include replacement of old text-based terminals with personal computers.
· Library Internet Access Upgrades, $62,000, Library Gift Funds.
· Southern Community Park, $895,000 in 1997 and $2,000,000 in 2001 Orange County bond funds. Development would follow conceptual plan adopted by Town Council and approved by Board of County Commissioners.
· Greenways Bond Projects, $100,000, 2001 Orange County Bond. Orange County funds would pay for either the Bolin Creek and/or Morgan Creek Trails. Funds would be restricted to projects that would link Carrboro and Chapel Hill.
1996 BOND PROJECTS
Please see Attachment 3 for a status report on ongoing 1996 Bonds projects.
UNFUNDED PROJECTS
Capital project requests for which funding has not been identified are included in Table 4. Brief descriptions of these projects are listed in Attachment 4.
PUBLIC FORUM COMMENTS
On January 29, 2003, the Council held a public forum on the budget and capital program needs. Advisory Board representatives made comments, which are summarized in Attachment 6.
FUTURE STEPS
On Wednesday, March 26, 2003, a public hearing will be held to receive citizen comments on the Capital Improvements Program. The Manager’s Recommended Capital Improvements Program will be submitted to the Council on Monday, April 28, 200 3. On Wednesday, May 14, 2003, 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 9, 2003.
We recommend the Council adopt the attached resolution referring this document to Town advisory boards.
ATTACHMENTS
· Table 1-A: Proposed Capital Improvements Fund Projects: Scenario A (p. 27).
· Table 1-B: Proposed Capital Improvements Fund Projects: Scenario B (p. 29).
· Table 1-C: Proposed Capital Improvements Fund Projects: Scenario C (p. 31).
· Table 2: Future Debt Financing Projects (p. 33).
· Table 3: Other Sources (p. 34).
· Table 4: Unfunded Projects (p. 35).
A RESOLUTION REFERRING THE PRELIMINARY REPORT ON THE CAPITAL IMPROVEMENTS PROGRAM (2003-03-26/R-1)
WHEREAS, the Council of the Town of Chapel Hill has received a Preliminary Report on developing a 2003-2018 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 14, 2003, regarding the Budget and Capital Improvements Program.
This the 26th day of March, 2003.