The URL can be used to link to this page

Home My WebLink AboutII. A. RETREAT PREVIEW – CAPITAL IMPROVEMENT PROGRAM (CIP) PROCESS 10.22.2024FY 2025-26 CIP Retreat Format Discussion Kevin Chatellier Director of Budget and Management Services October 22, 2024 Agenda •Background of factors impacting the CIP •Recap previously implemented tools and guidance provided •Balancing Approaches used in both FY 2023-24 and FY 2024-25 •Current Reality •Prioritization/Guidance •Outline of preparatory information and timeline CIP Inflation: PPI Construction Materials Month over Month -10% -5% 0% 5% 10% 15% 20%Jan-18Apr-18Jul-18Oct-18Jan-19Apr-19Jul-19Oct-19Jan-20Apr-20Jul-20Oct-20Jan-21Apr-21Jul-21Oct-21Jan-22Apr-22Jul-22Oct-22Jan-23Apr-23Jul-23Oct-23Jan-24Apr-24Jul-24The Producer Price Index is an inflationary measure that captures the average sales price of goods and services from one year to the next. $227 $199 $128 $0 $50 $100 $150 $200 $250 Jan-18Apr-18Jul-18Oct-18Jan-19Apr-19Jul-19Oct-19Jan-20Apr-20Jul-20Oct-20Jan-21Apr-21Jul-21Oct-21Jan-22Apr-22Jul-22Oct-22Jan-23Apr-23Jul-23Oct-23Jan-24Apr-24Jul-24CIP Inflation: PPI Construction Materials Indexed Source: Federal Reserve Economic Data Previous Guidance •FY 2022-23 CIP Process: •Authorized section 14 of the CIP Ordinance •2023 Retreat: •Maintenance of existing infrastructure and assets •Modernization of existing facilities and infrastructure •Expansion of existing infrastructure to meet community needs •New Facilities and Infrastructure •2024 Retreat Expanded Guidance to include consideration for: •Construction timelines •Match funding obligations •Age of project in terms of public expectations Past and Current Challenges •FY 2023-24 CIP Process: •Eliminated/Delayed 9 projects •Redirected $60 million to fill other gaps •FY 2024-25 CIP Process: •Redirected $30.4 million to partially restore funding on three of those roadway projects with grant obligations •Balance to complete for those three road projects reflected as $73.7 million •Redirected Beach Maintenance Facility programmed funding to Central Plant Loop FY 2024-25 Adopted CIP •Total of 345 City CIP Projects •298 Fully Funded •47 reflect a Balance to Complete •34 new projects requested •Requested but Not Funded for City Projects •Total amount $627,328,201 •Balance to Complete - TBD •USACE Regional Coastal Storm Risk Management •Law Enforcement Training Academy (LETA) •ITA Master Plan Current Market •Those are the ones on paper that can be tallied; however, bids continue to exceed estimates and budget. •Examples - •Elbow Road II-B & II- C: Bid twice - Exceeded $13.5 million •5/31 Memorial: Bid twice - Exceeded $4.3 million •Winston Salem Avenue: Bid three times- last Exceeded $4.6 million •FY 2023-24 CIP Transfers due to inflationary impacts totaled $35.1 million. •Insufficient funding to do everything and deliver projects within timeframe expected of public. “Myth” of $5 Billion CIP Appropriation/Financing Appropriated to Date FY 2025 Budget FY 2026 Budget FY 2027 Budget FY 2028 Budget FY 2029 Budget FY 2030 Budget CIP Total Capital Projects Buildings & Assets Section 307,186,793 39,178,526 40,615,254 21,066,142 30,070,884 29,342,589 15,909,202 483,369,390 Coastal Projects Section 130,098,243 17,460,931 12,249,849 10,991,137 10,212,341 13,356,341 12,606,341 206,975,183 Economic and Tourism Section 415,472,648 80,531,294 12,455,293 10,765,139 4,380,394 4,300,734 4,300,734 532,206,236 Information Technology Section 158,764,653 16,699,293 12,545,082 7,946,606 11,962,329 12,946,605 11,962,328 232,826,896 Parks and Recreation Section 180,986,804 31,403,163 64,535,860 14,654,239 24,756,603 14,861,629 14,969,385 346,167,683 Roadways Section 676,503,173 74,111,021 83,263,452 76,075,881 49,337,289 41,721,890 55,101,040 1,056,113,746 Sewer Utility Section 159,839,255 29,887,733 24,162,000 28,109,000 26,015,000 27,730,000 24,190,000 319,932,988 Stormwater Section 338,048,714 25,503,960 29,144,001 29,144,001 29,544,001 29,544,001 29,544,001 510,472,679 Water Utility Section 110,498,681 11,893,000 15,814,000 9,777,000 13,865,000 5,370,000 17,990,000 185,207,681 Schools Section 406,625,514 63,800,000 61,300,000 61,800,000 61,800,000 61,800,000 61,800,000 778,925,514 Flood Protection Section 775,683,006 28,062,917 4,100,000 4,622,000 3,000,000 3,000,000 3,000,000 821,467,923 Total Capital Projects 3,659,707,484 418,531,838 360,184,791 274,951,145 264,943,841 243,973,789 251,373,031 5,473,665,919 Unappropriated Subsequent Years “Myth” of $5 Billion CIP- Continued FY 2025 Total $ 418,531,838 Less: Enterprise Funds (66,759,960) Flood Protection (4,050,000) State Funding (49,211,483) Federal Funding (37,637,627) Special Service District Funds (5,409,149) Fire Grant Funding (300,000) Franchise/Medicaid/ Private Contribution, etc.(1,372,066) = Local Revenues $253,791,553 Less: Dedication Funds (18,935,504) Dedication Fund (Bonds)(68,935,424) Schools Local (63,800,000) = Remaining City Local Revenue $102,120,625 General Fund Debt 39,802,819 General Fund - Pay -as-you-go 26,797,390 General Fund- Fund Balance 35,520,416 $102 Million Allocation Section Amount Buildings and Assets 33,035,526 Coastal 11,980,015 Economic and Tourism Development 3,620,000 Information Technology 16,699,293 Parks and Recreation 5,006,135 Roadways 31,779,656 Total $102,120,625 •Roughly 24% of total yearly programmed CIP •Annual allocation across these sections is close to the construction cost of two roads. Various Challenges to Navigate •Projects driven by construction timeline. •Projects with local funding as an obligatory grant match. •Project timeline acceleration due to failure or risk associated with failure. •Maintenance “must do’s” vs “addressing maintenance backlogs” •Planning for more than just one-year but balancing an approach each year over the six-year CIP. City Council Direction and Guidance •Desired outcome of the City Council retreat is an actionable plan for Staff to reference in navigating the challenges ahead. •Answering questions such as: •What are the priorities? •Where should staff focus efforts in allocating limited resources? •Are all of the programs/projects included within the CIP the priority of this City Council? •Are there areas of focus not included within the CIP that should be of higher priority? Format for Consideration •November - December •CIP Section briefings to educate public and refresh City Council on project specifics. Projects will include updated cost. •Briefings will segment up each CIP section into “buckets” of projects based on unique challenges (Grant Funded, Dedication Funded, Under Construction, etc.)•Narrow focus to projects with minimum anticipated impact should delay/deletion occur.•Scoring for each project will occur based on staff input for City Council’s consideration •December •City Council engage with Fountainworks to provide feedback of prioritization and if additional consideration should be provided that Staff did not consider Format for Consideration - Continued •January •Feedback compiled by Fountainworks and used to facilitate the conversation at the January City Council Retreat. •February •City staff utilize that information and feedback from the retreat in the development of the FY 2025-26 City Manager’s Proposed Budget to be presented in March. Questions and Discussion