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Cap/ta/ Improvement Plann/ng -June 11, 2001 <br /> <br />This program represents the costs of rebuilding the municipal street <br />system. The Program finances reconstruction projects. It does not <br />finance sealcoating or new construction. <br />On-going. <br /> <br />Approximately $500,000 per year. <br /> <br />Street Improvement Fund - The City has established a fund for street <br />improvement projects. This Fund provides a funding vehicle, but the <br />current balance is not sufficient for long-term sustainability. The <br />City may wish to establish a street improvement permanent <br />improvement revolving fund under M.S. 429.091. This approach <br />gives greater flexibility in the use of assessment revenue and creates <br />bonding authority. <br /> <br />Assessments - Special assessments are a key to financing pavement <br />management activities. The amount assessed determines the funding <br />needed from other sources. The timing and flow of assessment <br />revenues influences other financial decisions. Current planning <br />assesses 33% of the improvement costs with a ten-year repayment <br />period. <br /> <br />Other Revenues - Unless all of the costs are assessed, some other <br />sources of revenue will be needed. Currently, the Street <br />Improvement Fund receives a portion of the Landfill surcharge. This <br />revenue plus interest on the investment of the Fund balance should be <br />sufficient to support the Program for the foreseeable future. If the <br />landfill monies are not available, then other revenues will be needed. <br />State aid for road maintenance and construction can only be used for <br />streets that are included in the state aid street system. Other non-tax <br />revenues are currently earmarked for various public facility projects. <br />The only remaining revenue source is the property tax. <br /> <br />Debt - The City does not have sufficient reserves to internally <br />finance this program. The City should finance improvement costs <br />through the issuance of bonds and use cash reserves to manage the <br />cash flow. The City may issue traditional G.O. improvement bonds <br />or G.O. bonds of a permanent improvement revolving fund. Both <br />options require (1) not less than 20% of the costs are assessed and (2) <br />the City must conduct the improvement hearing pursuant to <br />Minnesota Statutes, Chapter 429. <br /> <br />11 <br /> <br /> <br />