Agenda - Council - 02/10/2015 - Laserfiche WebLink

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CC Regular Session Meeting Date: 02/10/2015 By: Diana Lund, Finance 4. 7. Information Title Adopt Resolution #15-02-040 Calling for a Public Hearing on the Intention to Issue General Obligation Street Reconstruction Plan Bonds and the Proposal to Adopt a Street Reconstruction Plan Purpose/Background: Purpose: To provide funding for road reconstruction and bituminous overlays via the issuance of Road Reconstruction Plan Bonds. Background: Over the past several years, much discussion has taken place over the financing of road improvements. These needed improvements: Sealcoats, Overlays and Reconstructions are based on the 60 -year Long -Term Street Maintenance Program that the engineering department had compiled on all of the city's streets based on a PASER rating (the lower the PASER rating, the worse the road). Based on the Long -Term Street Maintenance Program, it was estimated that the highest priority projects averaged $2.2M over the first five years and increased after that. Of the estimated $2.2M, $500,000 would be funded from the General Fund and the remainder from the issuance of debt. The payment of said debt would be paid from an annual tax levy and assessment to benefiting parties. As the city will not be assessing 20% of the total bonded debt, the city cannot issue Special Assessment Bonds to fund road construction. Another alternative that was put in place in 2002 (for road reconstruction only) was the Street Reconstruction bond. Not until 2013 was the use of Street Reconstruction bonds allowed for overlays. Thus, the city is looking at issuing Road Reconstruction Debt for those projects (Garnet Street and overlay projects) as outlined for 2015 under the street maintenance plan and included in the City's 2015-2019 Capital Improvement Plan (CIP). There are requirements that need to be followed if the City desires to issue Road Reconstruction Plan Bonds. The requirements are: 1. A Five -Year Street Reconstruction and Overlay Plan (SROP) must be prepared. The City's five year as presented, is based on the highest priority street projects that Engineering had outlined in their Long -Term Street Maintenance Program and which are also outlined in the City's 2015-2019 Capital Improvement Plan (CIP). 2. City Council must hold a public hearing on the issuance of the bonds and Street Reconstruction and Overlay Plan. The public hearing request is the first step of the bonding process that needs to be undertaken for financing the road improvements which is what is being requested at tonight's meeting. The major requirement to allow the city to issue this debt, is that the City Council must approve the sale of the street reconstruction bonds by an unanimous vote of its membership present. Like a Capital Improvement bond, the Street Reconstruction bond is not required to have a referendum, but a reverse referendum is allowable. If a petition bearing the signatures of at least 5 percent of the votes cast in the last general election is filed with the City Clerk within 30 days after the public hearing regarding the bonds (March 10, 2015), the bonds may not be issued unless approved by voters. Notification: