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Home My WebLink About[06] 2019 Capital Budget 0W OFKT JOSE PH Council Agenda Item 6 MEETING DATE: August 20,2018 AGENDA ITEM: 2019 Capital Plans/Budget Discussion SUBMITTED BY: Finance/Administration/Departments BOARD/COMMISSION/COMMITTEE RECOMMENDATION: The EDA and Fire Board reviewed their draft 2019 budgets and capital plans. The Engineer presented potential project priorities to the all city board meeting. Each Board presented current initiatives in their respective areas at the all city board meeting. BACKGROUND INFORMATION: The capital budget process began when the Engineer presented the Engineer CIP at the joint Board/Commission and Council meeting held on July 30. Since that meeting the Engineer and Public Works department have reviewed all the items and have prioritized the projects. Staff would like to receive feedback from the Council on your priorities. Maps of the north and south areas of the city are included in the printed packets to depict the proposed project areas. The Park Board project priority will be presented in the fall after the Park Board receives the design plans from S.E.H. and further community center/ISD 742 community education are determined. The capital equipment plans were also printed for Council's review/comment. The equipment funding includes the 5-year rotation of the two equipment certificates to help fund the equipment and reduce spikes in the general levy. Below is a summary of the equipment requests for each department for the next three years. y ,flection Equipment / Computers Computers/Server Computers Business Develo ziieri/;' '� ,,,.Business Development Business Development Computers ktrip � ,-qull??3 alt.. � :, //�/! ! 0�� ; Ladder , , "Turnout Gear Turnout Gear Turnout Gear Air Packs a Handguns Mobile Laptops Radar Buy out squad lease '?j' uy „„ luiad le " `` Buy quad lease/ ,. . ' Surveillance Equipment Replace squad 702 Seal coat/Crack fill`;_ $ea / ;Seal coat/Crack fill ,u�.;�, Maintenance Truck Maintenance Truck Fuel Tank-w/PW bldg Street Sweeper Dredge Pond Z Trak Mower Trail Maintenance Plan 15751Vtawer(additional` %' 15, � Sewage Sampler Rate Study Update UB Printer ew�elevisGiLining Sewer Televising/Lining Sewer Televising/Lining Pond Maintenance Plan Millstream Park Drive Light Squad Leases to Purchase: When the City entered the police vehicle lease program the lease payments included gas and preventative maintenance. Over the years the program has become diluted and the program no longer pays for the gas. Police and administration reviewed squad lease options going forward. The City leases four squads for four years/85,000 miles, and owns one unmarked squad. The last couple squads were returned under the mileage usage, indicating useful life and value remaining in the squads. In addition, both Chevrolet and Ford now provide 100,000 miles power train warranties. The City has the option to purchase the squads at the end of the lease for the estimated remaining value between$6,000- $8,000. Based on low mileage and remaining warranties on the squads,the City could save roughly$3,000-$5,000 over the next five years by buying out the squads and driving them for the additional years. The trade in value at the end of 6-7 years will be applied to purchase new squads versus lease. Here is a summary of the next five year cost options. Total w/Buy Out if lease 5 yr save 2019 $ 34,905 $ 35,929 $ (1,024) 2020 $ 27,918 $ 35,494 $ (7,576) 2021 $ 44,933 $ _ 36,426 $ 8,507 2022 $ 37,356 $ '36,371 $ 985 2023 $ 28,680 $ 32,850 $ 4,170 Total Due $ 173,792 $ 177,070 $ 3,278 Equipment Certificates: The equipment certificates were reduced after the 2008/2009 Great Recession due to cuts to Local Government Aid(LGA)and reductions in the taxable market values. Since then the economy has been recovering. Minnesota Legislators increased funding for LGA and taxable market values increased 19% since 2014 and estimated to surpass pre-recession levels in 2019. Equipment costs continue to rise. Staff requests an increase in the funding levels of the 2020 and 2023 equipment certificates to the pre-recession levels to offset potential spikes in the general levy for future equipment replacements. The 2020 certificate were move back to$250,000, and the 2023 certificate would move back to$300,000. Public Works Facility: Per Council's direction, staff began reviewing options for a facility to house public works vehicles/equipment. The building was envisioned to be constructed when the current maintenance facility was paid in full. The bonds for the current facility will be paid off this year(Oct. 2018). The annual debt levy is $60,000. The capital budget moves the $60,000 from debt levy to capital reserve pending consideration of when the vehicle building would be constructed.Keeping the$60,000 in the budget will keep the levy funding level as planned back in 1997. Staff is looking for direction on whether to move forward with construction in 2019 as originally planned,or continue to put seed money aside to build by 2022. Staff would also like to provide a quick 3-year outlook of potential staffing changes for discussion. 2019: Implement Organizational Study Full Time Finance Technician 2020: Full Time Maintenance Worker 2021: Full Time Police Officer(3-5 years out) 2019/2020 Conversion of contract building inspection to city employee ATTACHMENTS: Request for Council Action—Capital Plans/Budget Discussion Capital Improvement/Equipment Plans REQUESTED COUNCIL ACTION: Discuss and provide feedback on the capital/budget items presented.