08-22-2017 CCM (CIP Plan)HUTCHINSON CITY COUNCIL
REVIEW OF 2018 PRELIMINARY CAPITAL IMPROVEMENT PLAN
MINUTES
TUESDAY, AUGUST 22, 2017, AT 4:00 PM
CITY CENTER — COUNCIL CHAMBERS
1. Call to Order
Mayor Forcier called the workshop to order at 4:00 p.m. Members present included Mary
Christensen, Chad Czmowski, Steve Cook and John Lofdahl. Others present were Matt Jaunich,
City Administrator and other city directors.
REVIEW OF 2018 PRELIMINARY CAPITAL IMPROVEMENT PLAN
2. 2018 Preliminary Capital Improvement Plan
Matt Jaunich, City Administrator, presented before the Council. Mr. Jaunich reviewed the
purpose of a capital improvement plan.
Mr. Jaunich began an overview of the five year capital plan document. The proposed plan is
estimated at $47.08 million. The Plan is approximately $3.28 million smaller than last year's
five-year plan. The plan has an average CIP cost of $9.42 million. 2018's $9.70 million CIP cost
currently accounts for approximately 20-25% of all budgeted expenses. For comparison
purposes, this year's (2017) general fund budget is 512.26 million. Council Member Cook
suggested that the City's seven core areas be included as part of this presentation.
Mr. Jaunich reviewed that the plan is divided into infrastructure at $31.19 million; Park & Rec at
$2.85 million; Enterprise Funds at $8.11 million; Public Works at $3.23 million; Public Safety at
$1.16 million and General Government at $546,500. The make-up of the CIP includes: New
Debt: $10.89 million (amount of money that we need to borrow to pay for capital projects);
Aid/Grants: $13.21 million; Enterprise Funds: $12.11 million; Taxes: $6.95 million; Special
Assessments: $3.73 million; Special Funds/Reserves: $186,903. CIP funding sources for
general fund projects include Facility Improvements, Fleet & Equipment and Other Capital
Needs. Enterprise fund projects are covered by cash flow from operations driven by user revenue
and cash reserves. Infrastructure improvements debt are covered by GO special assessment
improvements bonds, special assessment, municipal state aid for streets, grants, enterprise fund
contributions and other city funding from Capital Projects and Community Improvement. The
Capital Projects Fund funding sources come from LGA, bonding dollars and grants. The use of
these funds are for general fund capital improvements included in the Facility Plan, miscellaneous
infrastructure maintenance such as trails, sidewalks, parking lots, street lights, sealcoating, etc.,
and other projects approved by the City Council. The Community Improvement Fund funding
sources come from retired debt service funds and donations. The use of these funds are for City
Council approved projects and Public Arts Commission & other public arts projects. Mr. Jaunich
reviewed revenues and expenditures in each fund from 2016.
Mr. Jaunich noted where the proposed 2018 CIP monies are going to. They include $6.52 for
infrastructure; $238,000 for Park & Rec; $1.05 million for Enterprise Funds; $992,515 for Public
Works; $411,500 for Public Safety; $485,500 for General Government. Mr. Jaunich then
reviewed where the proposed 2018 CIP monies are coming from. They include $2.71 million
from New Debt; $3.22 million from Aid/Grants; 51.51 million from Enterprise Funds; 51.47
million from Taxes; $677,380 from Special Assessments; and $107,270 from Special
Funds/Reserves.
Mr. Jaunich provided an update on the aquatic center project.
Mr. Jaunich reviewed the five components of the Plan which include the fleet committee,
facilities committee, Creekside, Resource Allocation Committee and General. Mr. Jaunich
provided an overview of the fleet committee, as well as a review of the light duty and heavy duty
fleet. Mr. Jaunich then provided an update on the facility committee. Mr. Jaunich reviewed
projects completed in 2016 which were the first half of the Aquatic Center and the Water Street
garage roof replacement. He then reviewed a draft project list for 2018-2022. Mr. Jaunich then
provided an update on the Facility Master Plan Study which is coming to an end. A draft report
will be available shortly with the police department being the highest priority. There will be a
Council workshop in October to review the draft study.
Mr. Jaunich also reviewed the 5 Year CIP for both the compost and refuse funds which is just
above $1.5 million. No major changes are planned in the compost fund at this point. Two higher
dollar items remain in 2019 and 2020 with the screening plant and compost turner. The Refuse
Fund has a relatively low 5 Year CIP. Both the Compost and Refuse Funds continue to retain a
healthy cash balance with approximately $2 million in Compost and $1.2 million in Refuse.
Mr. Jaunich explained that the Resource Allocation Committee reviews Public Works projects
and for 2018 includes the following projects: Century Avenue SE (TH 15 to Jefferson); 2"d
Avenue SE Bridge replacement; South Central Area Trunk Storm Sewer; South Grade Road
Improvements; TH7 & Montana Street crossing system; Pavement Management Program; Street
Sealcoating; Airport T -Hangar; Wastewater Treatment Facility & Collection System; Water
Meter Replacement Program; and Street Lighting LED Retrofit. Mr. Jaunich then reviewed other
projects scheduled for 2019-2022 and other future CIP project considerations. Mr. Jaunich also
reviewed project funding limitations/concerns which include a 51.9 million bonding target
limitations, dedicated street Sealcoating funding at $125,000/year, infrastructure maintenance
needs at $250,000/year, construction cost increases, utility funds capacity, improvement special
assessment limitations and municipal state aid & federal aid utilization.
Mr. Jaunich also noted that long-term funding needs have to be identified for heavy and light fleet
as well as playground system replacement. A funding plan for a new/remodeled fire station and
police station should be developed. A couple of questions to be considered are whether or not the
hospital payment should be redirected to the CIP Plan and how LGA should be allocated between
the general fund and the CIP.
Council Member Cook asked if energy efficiencies could be identified when projects are
proposed.
3. Adjournment
Motion by Czmowski, second by Lofdahl, to adjourn the workshop at 5:17 p.m. Motion carried
unanimously.
ATTEST:
Gary T. Forcier
Mayor
Matthew Jaunich
City Administrator