PRESENTATION
1. PRESENTATION/DISCUSSION - On the proposed Capital Improvement Program for the City of Battle Creek for Fiscal Years 2011 - 2016.
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City Manager Ken Tsuchiyama explained the purpose of the workshop is to facilitate general understanding among City Commissioners and the Planning Commissioners about the purpose of the Capital Improvement Plan (CIP). He said that the CIP serves as a wish list and a snap shot of capital improvement needs. He said progress toward projects is often dependent on funding and some projects can sit on the list for years because funding is not available. He explained the Planning Commission's role is to review the CIP to ensure that it is consistent with the City's Master Land Use Plan. He gave an example of a potential conflict which could occur if a utility project was identified for an area set aside for green space in the Master Plan. He said the hope is that the Planning Commission would call this to the attention of staff and ask for a rationale for such a situation. He explained that staff uses its best judgment in defining and prioritizing capital needs.
Mr. Tsuchiyama then handed the meeting over to Assistant City Manager Jim Ritsema who presented a PowerPoint presentation. Mr. Ritsema also encouraged discussion and dialogue, stating that this is the beginning of the capital formation of the next fiscal year budget. This plan is the basis for the Capital Improvement Budget, which is established dependent on funding. He stated that the City has over $320 million invested in infrastructure throughout the City; infrastructure that requires maintenance at the same time the City needs to maintain operating budgets. He clarified that the process for approving the CIP does not approve any individual project within the plan. He explained the prioritization range is Urgent to Deferrable on a scale of 1-4. He referred to replacement pages handed out and then turned the meeting back to Mr. Tsuchiyama and Mayor Baldwin.
Mayor Baldwin asked about the Capital Projects by Paying Fund and asked if it were possible to shift projects among funds. Mr. Ritsema said that in general projects in enterprise funds are funded within those funds and are specific to those areas.
Mr. Stetler said there are hundreds of houses that need to be taken down around the City and that this is an expensive project, but has a long term positive impact. He wondered why this isn't addressed in the CIP. Susan Bedsole responded that a demolition budget is used to list those projects and that federal funding has been identified for this purpose.
Mr. Scheinfeldt said that the process has definitely improved and he congratulated staff for this work. He continues to have questions. He said that Mr. Tsuchiyama called this a snapshot, but that he personally prefers more detail and numbers. He asked what was last year's actual capital budget and what projects were in previous CIPs but have been dropped by staff. He asked for a report that would include this information some time before the Planning Commission is asked to approve the CIP.
Mr. Ritsema said this information is typically presented to the City Commission as part of the budget process and that these reports may be distributed to both commissions.
Mr. Hicks asked if reports could include variance in budgets, comparing what we thought we would do and what we actually did. He said this information would help provide context to the Planning Commission as it considers the plan.
Vice Mayor Simmons welcomed John Godfrey back to the Planning Commission. He recognized Mr. Scheinfeldt's leadership on this process. He asked about page 7 in the slide presentation and whether these are new projects added this year. Mr. Ritsema said yes, and that these are listed in a special section beginning on page 25 of the drafted CIP. Mr. Simmons then asked if any projects have been removed. Mr. Ritsema said that during the budget process staff shows projects recommended to not be funded, however he does not know if any projects have actually been removed. Mr. Simmons asked specifically about Fell Park projects he remembers from last year. Mr. Jeff Hovarter, Parks & Recreation Director, stated that Parks & Recreation has changed its view of how to reflect Parks Master Plan projects within the CIP. He said in the past all projects that could possible be foreseen were included, but currently staff is including only projects that have been identified as actual needs. He added that having long range visionary projects in the CIP created a lot of confusion among policy makers and the public because they appeared as though they were happening or were short term goals. These types of projects are still reflected in the Parks & Recreation Master Plan. Mr. Simmons said that the City Commission decided last year that Fell Park should be prioritized as a level 2 and he wants to know what weight was placed on priorities set by the commission when deciding what to put in the CIP. Mr. Hovarter said that all the projects in the CIP are identified as current needs. He said that for Fell Park, as with other parks, there is a vision for what it ought to be in the future and that at any time Commissioners can pull projects out of the Master Plan and ask for its inclusion in the budget.
Comm. Fulton asked about the Parks & Recreation Master Plan process. Mr. Hovarter said that it is a plan that gets updated every five years and there is extensive public process, a needs assessment and review by the Michigan Department of Natural Resources. He said that a link to the plan is available on the City website. Mr. Godfrey asked Mr. Hovarter to extend the examples given earlier in the presentation. He asked, as staff continues to look at collaboration between the City and the YMCA, whether projects identified for Full Blast are necessary or just a plan to limp along until a major renovation is done. Mr. Hovarter said the building can continue to limp along, there are some needed improvements to pool filtration systems for example and that funds are available in the Full Blast Endowment Fund. Mr. Tsuchiyama added that repairs at Full Blast were included in part because there still is not formal agreement to move forward with the YMCA.
Comm. Morris asked Mr. Hovarter if he has gathered second opinions about mechanical needs. Mr. Hovarter said yes. He also asked for clarification on the purchase of golf carts. Mr. Hovarter said carts are actually purchased and paid for by golfers through a rental fee and are handled within the enterprise fund.
Mr. Scheinfeldt commented that the Planning Commission reviews the City's Master Land Use Plan, however the Parks & Recreation projects are not included. He said he participated in the Parks & Recreation public process, which was well done. As Planning Commissioner, he is requesting that staff provide a written explanation of rationale for including projects in the CIP, much as Mr. Hovarter provided here tonight. He asked for a broad perspective on what is going on so the Planning Commission understands the context when projects are included in the CIP.
Comm. Yankama asked of all the Priority One projects, how does staff plan to fund all of these in coming years. Mr. Ritsema said that funding decisions happen in the budget process and that staff is currently focused on adjustments needed to the current fiscal year and starting to put together a picture of next fiscal year. He said operations require funding and there are two ways to fund capital: there is pay-as-you-go, which we do for street projects and which is viewed favorable by crediting agencies. The other method is debt leveraging. He said the City tries to manage debt sensibly. He said the approach is not unlike what a homeowner would do if a new roof is needed, either the homeowner can save up and pay cash or they can take out a loan. He said the City just has a lot more zeroes behind its numbers because projects are bigger.
Comm. Gray asked a question about street projects which are all marked Priority One. City Engineer Chris Dopp said we spend about $3 million a year on road maintenance and that plans are laid out for the next six years. He gave an example of North Avenue, which will be resurfaced in 2011, which was planned in 2004. He said staff is always looking out five to six years and that street projects may not look like a priority now, but they will be in the year they are scheduled. He said as the City has lacked funding one area that has suffered is complete reconstruction projects. He said resurfacing can prolong the life of a road and defer the need for a complete reconstruct, which costs 5-7 times the cost of a resurfacing. Mayor Baldwin commented that there have been effective presentations on the process used to measure the condition of roads. Mr. Dopp said a pavement management system is used to rate the condition of roads on a scale of 1-10, although a road that rates less than 5 is much more costly to repair. This year the average condition is almost 6 across the city and staff feel good about this. He said the concern about letting roads on average get less than five is that then repairs are more costly.
Mr. Hicks asked about vehicle needs for Police and Fire and where these are listed. Transportation Director Greg Zanotti explained that Fleet Services Division manages the fleet needs for the City, working with departments to discuss equipment needs based on services provided. Mr. Tsuchiyama explained that tab 22 shows the Equipment Center Fund and the annual vehicle replacement fund reflects the plans, although pieces of equipment are not identified specifically. The only exception to this list is fire apparatus.
Mr. Hicks then asked about the difference between the Capital Improvement Fund and the General Capital Improvement Fund. Mr. Ritsema said that the General Capital Improvement Fund was created a few years back and sets aside money by departments for capital improvements, based on the revenue control based budgeting system that allows departments to set aside end of year savings as a contingency. Departments can fund capital projects they have out of these funds.
Mr. Morris asked about e-learning at the Airport and why the City would invest a half million dollars in e-learning at the airport when Western Michigan has an aviation school. Mr. Tsuchiyama said that on page 157 there is a description of the project, which is proposed out of the BCTIFA and is put forward by Battle Creek Unlimited. Ms. Frantz said she isn't able to say whether this is a TIFA budgeted item, but that she believes this is related to marketing and the e-learning Smart Zone. Mr. Morris said he fully supports Western, however they need to have a larger presence in the City. Ms. Frantz said she would relay that message to Battle Creek Unlimited.
Mr. Godfrey asked staff to provide more information about the economic impact of recreation facilities, as well as the Downtown Development Authority projects that are connected to the downtown transformation. He said as more global companies, such as Covance, are coming to the City that we need to keep downtown projects in the forefront. He said an overview of capital projects that are repeatedly mentioned and that are part of this downtown transformation plan would be helpful, especially down the road during budget time. Mr. Tsuchiyama said that as information has been requested about recreation projects already that it makes sense to add this to that report.
Comm. Yankama asked Mr. Ritsema if the federal government is auditing stimulus dollars. Mr. Ritsema said that currently the city is in the process of applying for funds and that there will be a reporting process down the road. Comm. Yankama asked if leaf pickup could be put in the CIP. Mr. Ritsema explained that leaf pickup is an operational cost that would be discussed at budget time, not as part of this process. He said in regards to the stimulus funding, some of the funding areas including transit, brownfield and energy efficiency for example haven't really facilitated any projects in the CIP. He indicated that a second round of stimulus dollars may be coming. He said staff is continuing to pursue grant dollars, but that tight times are ahead.
Comm. Yankama said he supports e-learning and using Tax Increment Finance Authority (TIFA) dollars for this purpose. He asked if TIFA dollars could help the City through difficult times. Mr. Ritsema said that there are state limits on how TIFA dollars can be spent. Vice Mayor Simmons clarified that the City could look at pass through taxes, although he isn't recommending that at this time. He then pointed out that committing local match dollars to receive grants means considering what projects we aren't funding because those funds aren't available. He asked if stimulus funding is diverting funding from projects we really need. Mr. Zanotti said that the City was granted a dollar amount in stimulus funding and that no match has been needed. Mr. Hovarter said there were a lot of changes in the process while cities were applying for stimulus dollars that may have created confusion about whether or not a match was needed. Mr. Tsuchiyama said that the City really hasn't been chasing stimulus dollars and the City isn't doing projects just because stimulus dollars are available. The closest project to meeting that description is a project being discussed by BCATS and that is actually to be paid for by CMAC funds, which are available only for projects that mitigate air quality control concerns. Mr. Tsuchiyama said that staff looks at long term impact of funding projects.
Comm. Morris spoke generally about the value of parks and how they add to the quality of life in our community. He commended staff for their efforts.
Mr. Scheinfeldt asked about the relocation of Dr. Martin Luther King Highway, first mentioned on page 61, and that he would like to have more information about this project before asking to approve. Ms. Frantz said this is the second time questions have come up about TIFA projects and that it appears that the projects are appearing under line item titles, and not necessarily including total project descriptions. She pointed out that relocating this street would have been required by one of the strategies that came up in the Base Realignment and Closure Process to protect the Air National Guard base. While the strategy that would have required the relocation of that road was not implemented, the estimate was kept on the books in case it is needed in the future. She said that such a major project would not be undertaken without a major private investment and many jobs as a benefit. She pointed out that many projects listed here are important for distinguishing the City when marketing for economic development. Mr. Tsuchiyama confirmed the purpose of the road relocation was related to the Air National Guard base and now could be considered a place holder and that its priority rating should be changed to reflect that.
Vice Mayor Simmons clarified that he is talking very generally this evening and that his comments shouldn't be interpreted in any way as against linear park funding, which he supports, but he chose it as an example to discuss his concerns about stimulus funding.
Comm. Sullivan asked if funds are actually set aside for the road relocation. Mr. Tsuchiyama explained that this planning document does not allocate any funding and that costs associated with projects are cost estimates for planning purposes only.
Mr. Godfrey asked about Beckley Road resurfacing on page 80. He said it is federally funded at 80% with a 20% city match, but he looked and the entire stretch of road is in Emmett Township. City Engineer Chris Dopp clarified that this is a cooperative project and that the City portion is within the city boundaries and the county is handling the rest. Mr. Tsuchiyama said it appears there is an error in the description that will be corrected.
Mr. Hicks asked about the four rating tiers and whether anything lurks beneath the surface. Are there projects so big that they don't surface to the CIP. Mr. Ritsema said that in the water and sewer departments there are areas that are a constant struggle. He said that the City has over $320 million invested in infrastructure that, over time, all needs to be maintained and replaced. Paying for these through utility costs means balancing the need to replace costs and the need to keep utility rates affordable for residents. The City has a lot of pipe in the ground and any day there could be a major failure. He said that challenge is literally and figuratively under the surface.
Mayor Baldwin asked staff to introduce themselves and thanked them all for attending.
Mr. Ritsema outlined next steps. He said staff would follow up on requests made this evening. He said staff would bring the CIP to the Planning Commission at its meeting on January 27 and to the City Commission at the first or second meeting in February.
Comm. Yankama said he hopes that staff consider debt load in addition to using stimulus money as it considers how to fund projects. |