05/09/2005 Council Packet - Laserfiche WebLink

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r r ■ d Recommended Funding Sources 25 5 Recommended Funding Sources Springsted Springsted, working with the City staff, has developed a proposed plan for the financing of the Pavement Management Plan. We recommend the City pursue the following plan with respect to the financing of the PMR. 1. Property Tax Levy: The City should levy a property tax to fund total annual maintenance costs identified in the PMR. These costs include sealcoating and overlays averaging $330,000 on an annual basis which are necessary to maintain the street infrastructure in the City in an acceptable condition. The PMR points out that continuing the current maintenance practices over the next ten years will result in serious deterioration of the City's street system. It projects that reconstruction costs of approximately of $39 million would be needed to restore the overall street system to its current condition. Increasing pavement maintenance and reconstruction spending to the amounts we have recommended would actually improve the overall pavement conditions in the City at a cost of $28 million resulting a net savings of $11 million over the next 10 years according to the Pavement Management Report prepared by TKDA. 2. General Obligation Improvement Bonds Repaid By Special Assessments (Minnesota Statutes Chapter 4291: For reconstruction projects where the existing street width is inadequate resulting in widening of the street and that cannot be financed with M.S.A. funds, state or federal transportation grants or County participation, we recommend the City issue General Obligation Improvement Bonds pursuant to Minnesota Statutes 429. The benefiting properties should be assessed an amount equal to the special benefit they receive as a result of the improvement, but no less than 20% of the City's share of the costs. The remaining amount would be repaid from a property tax levied on all properties in the City. 3. General Obligation Street Reconstruction Bonds (Minnesota Statutes Chapter 4751: For reconstruction projects where the existing street width is adequate resulting in no widening of the street and where other elements not currently existing like curb and gutter do not need to be included in the improvement and that cannot be financed with M.S.A. funds, state or federal transportation grants or County participation, we recommend the City issue General Obligation Street Reconstruction Bonds pursuant to Minnesota Statutes Chapter 475. Benefiting properties should be specially assessed an amount equal to the special benefit they receive as a result of the improvement. The remaining amount would be repaid from a property tax levied on all properties in the City. However, the City would not need to specially assess at least 20% of the local. costs as required for General Obligation Improvement Bonds or hold a special election. - 1 9 4 - City of Lino Lakes - Pavement Management Plan Financing Report