10-27-14 WS Agenda
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
CITY COUNCIL WORK SESSION COUNCIL CHAMBERS
MONDAY, OCTOBER 27, 2014 6:00 P.M.
AGENDA
1. CONVENE CITY COUNCIL WORK SESSION
A. Roll Call
Mayor Zerby _____
Hotvet _____
Siakel _____
Sundberg _____
Woodruff _____
B. Review Agenda
ATTACHMENTS
2. CAPITAL IMPROVEMENT PLAN DISCUSSION Finance Director’s memo
3. TRAIL FUNDING OPTIONS Administrator’s memo
4. ADJOURN
U#2
MEETING TYPE
City of Shorewood Council Meeting Item Work Session
Title/ Subject: 2015 -2019 CIP
Meeting Date: October 27, 2014
Prepared by: Bruce DeJong, Finance Director
Reviewed by: Bill Joynes, City Administrator
Larry Brown, Public Works Director
Paul Hornby, City Engineer
Attachments: CIP Projects by Funding Source
Policy Consideration:
How should the City of Shorewood prepare Capital Improvement Plans (CIP) for 2015 -2019?
Background: City Council and Staff had a conversation regarding the CIP for 2015 -2019 on July 28.
There are many challenges in regard to funding CIP projects as we continue to run into low cash
balances in many of the funds for trails, parks, and equipment. This will necessitate raising property
taxes, transfers from other sources available primarily in the enterprise funds from the Water or Sewer
fund balances, or possibly bonding. The 2015 Budget does anticipate increased funding for the
Equipment Replacement and Street Reconstruction funds.
There are major changes to the CIP from the one adopted for 2014 -2018 in Equipment Replacement,
Street Reconstruction, Trails, and Storm Water. The Equipment Replacement fund needs to have a
more specialized trail plow. This piece of equipment costs about $150,000. The good news is that it can
also be fitted with attachments for mowing. As a result, we can avoid replacing the Ford tractor ($54K)
and the side and rear mower attachments ($30K) that were planned in 2015. This gets us over halfway
to the cost of the new machine and there is some trade value left in the old equipment.
In Street Reconstruction, staff has proposed reconstructing Strawberry Lane and a West 62nd Street in
2019 instead of the seal coat that was planned. This is coordinated with constructing a trail and
improving storm sewer processes in that area. This is a major increase in cost. We have also added
Eureka Road N to the Street Reconstruction plan. In response to the City Council deciding against an
MSA funded project, something needs to be done on the road. Staff is proposing a reclamation which is
preliminarily estimated at $260,000. The Storm Water improvements associated with Eureka Road N
are still included in this preliminary analysis waiting on some direction from City Council.
In Trails, we have updated the numbers for all trail segments based on recent history and bidding. The
Galpin Lake Road and Smithtown East trails will likely cost significantly more than was anticipated a year
ago. The Strawberry Lane trail is basically extended south from Smithtown Road and curves around W
62nd Street to Cathcart Park. By constructing the trail in conjunction with road work there is some
savings but the trail portion is now estimated to cost $1,135,000 including storm water and right of way
costs.
The Stormwater Fund absorbs new costs for Strawberry Lane and W 62nd in the amount of $285,000.
This will have to be accomplished in conjunction with other regional improvements in the area storm
water management around Freeman Park and Shorewood Oaks area.
The primary challenge in the Park Improvement Fund is deciding what to do in Badger Park. The current
Badger Park plans are over $1,000,000 and staff and WSB are reviewing what can possibly be done to
reduce the cost. Even with the more modest estimate of about $523,000 included in the 2014 -2015 CIP
can't be funded from current resources. The Park Improvement Fund has about $213,000 in fund
balance at year end 2013 - less about $15,000 of remaining project costs for 2014 projects. The
modifications could also be staged over several years instead of one large project. That would not
necessarily reduce the total cost, but the annual resources needed could be minimized.
The Water Fund will postpone a couple of projects from 2014 to 2015. This is the result of the west
water tower inspection. There was freeze damage that makes cleaning and repainting more difficult
which will require more time than will be available this fall after the sprinkling season. This will also
delay the radio /ISP project until 2015. Both projects are adequately funded and delaying a year doesn't
pose any problem from the staff viewpoint.
Financial or Budget Considerations:
The challenge is to determine the most acceptable financing method for the projects the City Council
wants to undertake. There are resources available to pay for many of the contemplated projects, but
the timing of those projects and the specific funding is debatable since there is no one "right way" to
cover these costs.
The enterprise funds were reviewed to determine appropriate rates to cover all the costs associated
with the operations. The Storm Water fund rates need to be increased but a determination of how
much of the storm water work associated with trails is crucial to that process. The Sewer and Water
funds have cash balances in excess of what is necessary for operations and much of that could be
transferred out to other capital projects.
The trail projects have been designed to State Aid (MSA) standards and part or all of the MSA
construction allocations that the city receives could be allocated to trails. Eureka Road North was the
only street project anticipated to use MSA funds, but the road could be reclaimed in its current
configuration for significantly less than the amount required to meet MSA standards. This would
potentially free up funds for the trail projects. There are no other MSA construction plans at this point.
Options:
The City Council is encouraged to discuss any capital project changes with staff.
Recommendation / Action Requested:
Staff recommends that the City Council determine which projects it wants to fund and how the costs
should be allocated between funds in order to provide a reasonable estimate of any increased tax levy
support prior to the adoption of the preliminary levy later this summer.
Next Steps and Timelines:
The City Administrator and Finance Director intend to continue discussions regarding capital and budget
items through the Truth -in- Taxation hearing in December.
Connection to Vision / Mission:
Adopting a prudent capital plan contributes to sound financial management.
City of Shorewood, Minnesota
Capital Improvement Program
2015 thru 2019
PROJECTS BY FUNDING SOURCE
Source Project# Priority
402 - Park Improvements
Gideon Glen Signage & Parking Lot
P0003
Freeman Plaza
P0100
Freeman North Playground Equipment
P0102
Freeman Parking Lot w/ MCWD
P0103
Freeman Ball Field Lights
P0104
Freeman - Waterline for Community Garden
P0111
Cathcart Park - Resurface Tennis /Basketball Courts
P0200
Cathcart Park Hockey Boards
P0201
Cathcart Park Tot Lot
P0202
Badger Park - Creek Crossing
P0300
Badger Park Tennis Courts
P0301
Badger Park Field Improvements
P0302
Badger Park Parking & Road
P0303
Badger Park Amenities
P0304
Silverwood Park - Resurface 112 court
P0500
Silverwood Park Equipment
P0501
Silverwood Park Swing Set
P0502
Skate Park Rehab
P0600
402 - Park Improvements Total
10,000
403 - Equipment Replacement Fund
10,000
2
UTV - replace unit 34
034
Sweeper - replace unit 46
046
Flatbed - 4 x 2 Replace unit 49
049
Trailer 18' replace unit 59
059
Sand Pro 3000 - replace Unit 64
064
Dump Truck - replace unit 72
072
Pickup 44 - Replace Unit 78
078
Pickup - 350 44 replace unit 81
081
Mower - Replace Unit 86
086
Groundsmaster Mower replace unit 93
093
Boom Truck
100
Chipper
101
Trackless Trail Machine w/ Flail Mower
103
Cab for mower - replace A04
A04
Engine/Transmission Analysis Station
A09
Replace Sander
A10
Plow Blade & Snow Kit for Skid Steer
All
South Shore Community Center
PF -11 -01
Public Works Building
PF -12 -01
Computer Upgrades
T -99 -99
2015 2016 2017 2018 2019 Total
5
15,000
15,000
5
5,000
5,000
4
55,000
55,000
5
50,000
50,000
5
75,000
75,000
4
8,000
8,000
1
6,500
7,000
13,500
3
40,000
40,000
5
50,000
50,000
3
10,000
10,000
2
8,000
8,000
16,000
n/a
170,000
170,000
2
178,000
178,000
2
157,000
157,000
2
2,000
2,500
4,500
3
60,000
60,000
3
14,000
14,000
3
75,000
75,000
546,500 115,000 113,000 202,500 19,000 996,000
5
5 4,000
5 44,000
5
2
5 170,000
3
5 42,000
4
5
5
5
1 150,000
4
n/a
3
3 7,500
20,000
15,000
13,000
38,000
28,000
28,000
84,000
45,000
7,500
4,500
14,000
n/a 2,500 43,000 41,000
n/a 81,000
1 10,000 10,000 10,000 10,000 10,000
20,000
4,000
44,000
15,000
13,000
170,000
38,000
42,000
28,000
28,000
84,000
45,000
150,000
7,500
4,500
14,000
7,500
86,500
81,000
50,000
Friday, October 24, 2014
Source Project# Priority
403 - Equipment Replacement Fund Total
404 Street Reconstruction Fund 1
Chaska Road
LR -15 -01
Mayflower Road
LR -15 -02
McKinley Court
LR -15 -03
Murray Hill Road
LR -15 -04
Star Circle & Lane
LR -15 -05
Summit Avenue
LR -15 -06
Amlee Road
LR -16 -01
Garden Road
LR -16 -02
Gillette Curve
LR -16 -03
Manitou Lane
LR -16 -04
McKinley Place N & S
LR -16 -05
Shady Hills Circle
LR -16 -06
Echo Road
LR -17 -01
Howards Point Road
LR -17 -02
Kathleen Court
LR -17 -03
Oak Ridge Circle
LR -17 -04
Riviera Lane
LR -17 -05
Shorewood Lane
LR -17 -06
Mann Lane
LR -18 -01
Maple Street
LR -18 -02
Bayswater Road
LR -19 -01
Boulder Circle
LR -19 -02
Christmas Lane W
LR -19 -03
Lilac Lane
LR -19 -05
Strawberry Lane & W 62nd
LR -19 -06
Vine Street
LR -19 -07
Eureka Road N
LR -19 -08
Street Sign Replacement
LR -99 -001
Maintenance - Bituminous Sealcoating
LR -99 -100
404 - Street Reconstruction Fund Total
317,000
405 - MSA, Road Reconstruction Fund
65,000
Christmas Lake Rd Signal Refurbish
MSA -1501
405 - MSA Road Reconstruction Fund
65,000
Total
51,000
j406 ,_ Trails
Galpin Lake Rd Sidewalk
T003
Smithtown from Co Rd 19 to Regional Trail
T006
Strawberry Lane & W 62nd
T007
Excelsior Blvd - Greenwood to Barrington
T016
406 - Trails Total
180,000
601 - Water Fund
Air Compressor- Replace unit 38
038
Utility Truck w /crane & toolbox replace unit 76
076
2015 2016 2017 2015 2019 Total
427,500 194,500 197,500 68,500 44,000 932,000
5 87,000
1,330,000
1 1,340,000
1,340,000
1
87,000
5 33,000
300,000
2,970,000
850,000 3,820,000
3 12,000
33,000
5 40,000
77,000
40,000
5 52,000
52,000
5 453,000
453,000
5 32,000
32,000
5
332,000
332,000
5
42,000
42,000
5
35,000
35,000
5
317,000
317,000
5
65,000
65,000
5
51,000
51,000
5
71,000
71,000
5
180,000
180,000
5
22,000
22,000
5
29,000
29,000
5
371,000
371,000
5
455,000
455,000
5
444,000
444,000
5
100,000
100,000
5
100,000
100,000
5
49,000
49,000
5
32,000
32,000
5
46,000
46,000
5
1,140,000
1,140, 000
5
33,000
33,000
5
260,000
260,000
2 6,900
7,200
7,500
7,800
8,100
37,500
1 228,000
245,000
184,000
238,000
305,000
1,200,000
931,900
1,094,200
1,319,500
789,800
1,973,100
6,108,500
n/a 8,000 8,000
8,000 8,000
1 1,330,000
1,330,000
1 1,340,000
1,340,000
1
850,000 850,000
1 300,000
300,000
2,970,000
850,000 3,820,000
3 12,000
12,000
5 77,000
77,000
Friday, October 24, 2014
Source Pro,iect# Priority 2015 2016 2017 2018 2019 Total
Utility Vehicle - replace unit 77
077
4
27,000
27,000
Pick -up -4 x 4 150 Replace Unit 80
080
5
35,000
35,000
Radio /ISP Communications System
W -10 -01
1
80,000
80,000
Water Main - Star Circle & Lane
W -11 -02
n/a
130,000
130,000
W. Water Tower - Rehab & Painting
W -13 -03
3
450,000
450,000
601 - Water Fund Total
784,000
27,000
811,000
1611 Sanitary Sewer Fund
Sewer Jetter - replace unit 60
060
5
51,000
51,000
Lift Station 10 Rehab - 4773 Lakeway Terrace
SS -15 -01
3
80,000
80,000
Lift Station 20 Rehab - 26550 Noble Road
SS -16 -01
3
70,000
70,000
Lift Station 7 Rehab - 5600 Woodside Road
SS -16 -02
3
80,000
80,000
Lift Station 18 Rehab - 4996 Shady Island Point
SS -17 -01
3
10,000
10,000
Infiltration and Inflow Reduction
SS -99 -05
1
70,000
70,000
70,000
70,000 70,000
350,000
611 - Sanitary Sewer Fund Total
150,000
271,000
80,000
70,000 70,000
641,000
631 - Stormwater Management Fund
Galpin Lake Rd Trail Stormwater
SS003
1
230,000
230,000
Smithtown Road Trail Stormwater
SS006
1
285,000
285,000
Shorewood Lane Ditch
STM -13 -01
4
172,500
172,500
Star Circle & Lane
STM -15 -01
5
31,000
31,000
Grant Lorenz
STM -15 -02
5
50,000
50,000
50,000
150,000
23350 Academy Drainage
STM -15 -04
4
75,000
75,000
Garden Road
STM -15 -05
4
26,000
26,000
Amlee Road
STM -16 -01
4
78,000
78,000
Manitou Lane
STM -16 -02
4
75,000
75,000
Riveria Lane
STM -17 -01
4
87,000
87,000
Shorewood Lane
STM -17 -02
4
99,000
99,000
Mann Lane
STM -18 -01
4
105,000
105,000
Maple St
STM -18 -02
4
24,000
24,000
Eureka Road N
STM -19 -01
4
452,000
452,000
Strawberry & W 62nd
STM -19 -02
4
283,000
283,000
631 - Stormwater Management Fund
869,500
203,000
236,000
129,000 735,000
2,172,500
Total
GRAND TOTAL 6,687,400 1,904,700 1,946,000 1,259,800 3,691,100 15,489,000
Friday, October 24, 2014
#3
CITY OF
SHOREWOOD
5755 Country Club Road Shorewood, Minnesota 55331 952-960-7900
Fax: 952-474-0128 www.ci.shorewood.mn.us cityhall@ci.shorewood.mn.us
Date: October 27, 2014
To: Mayor and City Council
From: Bill Joynes, City Administrator
Re: Trail Funding Options
We thought that with recent adjustments on the MCS Excelsior trail, our experience in this year’s
bidding environment and the desire on the part of the Council to proceed with the Galpin, Smithtown East
and Strawberry Lane trails, that it would be a good time for the City to discuss funding options for the near
future. After last year’s retreat, the Council directed staff to proceed with three trails in 2015 and 2016.
They were Excelsior, Galpin and Smithtown East. We provided a funding plan that used a variety of internal
sources. As you are aware, the current bidding environment has greatly increased the costs of those
projects beyond the capabilities of the plan.
The Council has expressed a desire to proceed as soon as possible with the unfinished trail
segments and staff has provided below a number of options or, combinations thereof, that will accomplish
that in the 2015 / 2016 time frame. The recommendations are based on recent bidding experience and our
assumption the bidding climate will remain the same for the next year or two. All of the options have tax
consequences and a few have public input requirements. Holding the projects until the construction
industry returns to a more normal state might be prudent but impossible to predict or guarantee.
We are asking for Council direction so that we can finalize the 2015 Budget and prepare to initiate
any of the options the Council might choose.
MEMORANDUM
Date: October 27, 2014
To: Mayor Zerby
Council Members
From: Bruce DeJong, Finance Director
Re: Bonding Options for Trail Construction
There are several options for financing the construction costs for trails along Galpin Lake Road,
Excelsior Boulevard, Smithtown Road East, and Strawberry Lane. Each of the methods have
advantages and drawbacks. This is not meant to be an exclusive list of financing options, but
does highlight the most commonly used methods as allowed by Minnesota state law.
GENERAL OBLIGATION BONDS
These bonds are legally backed by the full faith and credit of the city, meaning the city has the
power to use its taxing power, if necessary, to repay the debt. The disadvantage of GO bonds is
that they require an affirmative vote from residents. These bonds do not have a maturity limit
and may exceed 10 years for repayment.
CAPITAL IMPROVEMENT BONDS
Cities may issue capital improvement bonds for specific purposes. It is essential that cities follow
statutory procedures (such as providing notice and a public hearing) when issuing this, or any,
Type of bond. In this context, "capital improvement" means acquisition or betterment of public
lands, buildings, or other improvements for the purpose of a city hall, town hail, library, public
safety facility, and public works facility. The term "capital improvement' includes expenditures
incurred by a city before approval of a capital improvement plan, in certain situations. An
improvement must have an expected useful life of five years or more to qualify. Three -fifths, or
three of five, members of a five - member governing body must vote to approve the bonds. In the
case of a governing body having more or less than five members, at least two - thirds of the
council must vote to approve them. These bonds are limited to a 10 year maturity. An election
is required if a petition signed by voters equal to five percent of the votes cast in the last
municipal general election is filed with the clerk within 30 days after the public hearing.
EDA LEASE REVENUE BONDS
Economic Development Authorities (EDAs) possess additional finding power that may help
cities fund certain local improvements. In general an EDA can issue lease revenue bonds
(without a vote or referendum requirement and not subject to net debt limits) to construct public
facilities such as a fire hall or a city hall, and lease it back to the city. In the lease, the city agrees
to cover the bond payments and eventually purchase the public facility. This is the financing
method used for both the public safety buildings and city hall remodeling.
Trail Financing
Estimate for Galpin Lake $1,558,235
Estimate for Smithtown East $1,340,500
Strawberry Lane $1,135,450
Excelsior Boulevard $300.000
Total Trail Projects $4,334,185
Available in CIP ($2,224,800)
Budget Gap $2,109,385
Bidding environment, not likely to improve until backlog of projects is gone.
Everyone is thinking of rebidding Spring, 2015.
Options to procceed with trail financing:
Bonding Program
Internal Borrowing — Water Fund is most likely candidate
Tax Levy Increase — will take many years to build up sufficient funds
Grants, Other Agencies — very competitive
Development Contributions — Park Dedication currently $5,000 per new lot