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MEMORANDUM <br />TO: CITY COUNCIL <br />FROM: ADAM T. EDWARDS, PE <br />SUBJECT: STREET FUNDING DISCUSSION <br />DATE: MAY 26, 2014 <br />______________________________________________________________________________ <br /> <br />References: <br />City of Orono Pavement Management Plan, adopted October 27, 2014. <br />City of Orono 2015 Capital Improvement Plan (CIP) <br />City of Orono 2015 Budget <br /> <br />List of Exhibits: <br />A. Road Maintenance for the Next 10 Years <br /> <br />1. Issue. Currently the City’s street rebuilding and maintenance requirements exceed funding. <br /> <br />2. Background. For some time the City of Orono has struggled as to how to come up with annual funds <br />to maintain its road/street infrastructure. The 2015 Budget does include $65,800 for pavement <br />maintenance which is sufficient for potholing, signs and winter maintenance. For 2015 City provided <br />$69,700 for contracted street maintenance of which $53,403 was designated for Seal Coating the Casco <br />Point Streets. The Pavement Management Fund (PMF) has $0 and there is $1.27M available through the <br />MSA Funds. The amounts budgeted and available are considerably less that the averages of $540,000 for <br />maintenance and $947,000 for reconstruction budgeted for in our surrounding communities. More <br />importantly the recourses available are significantly below the amount required to properly maintain the <br />city’s streets. In the past, the City has funded street reconstruction projects through the sale of bonds and <br />has applied leftover general fund amounts towards street maintenance projects. This has resulted in the <br />disproportionally large number of streets in disrepair and the inability for the Staff to plan for and execute <br />a maintenance plan to protect and extend the life of these valuable assets. <br /> <br />a. Pavement Planning. The City developed a Pavement Management Report (PMR in 2006 <br />(updated in 2011) that provided a summary of the condition and rehabilitation recommendation for all of <br />Orono’s roadways. The PMR did not provide any recommendation for prioritizing any of the roads and <br />did not lay out any sort of funding plan to cover the costs. In October 2014 the City adopted a Pavement <br />Management Plan (PMP) which does provide prioritization of road maintenance as well as a description <br />of funding sources. The PMP is used to inform the City’s Capital Improvement Plan (CIP) which does <br />provide specific priorities specific roads to receive maintenance or reconstruction out to 5 years and <br />identifies a funding requirement in general categories out to 20 years. The 2015-29 (CIP) adopted on <br />December 8, 2014, plans for annual expenditures for street seal coating of $254,000 and annual <br />expenditures for mill & overlay and reconstruction of ~$1,400,000 beginning in 2015. <br /> <br />b. Staffing and Action to Date. In the Fall of 2013, the City Council directed Staff to develop <br />options for funding annual street reconstruction and maintenance. In response, the City Engineer <br />conducted a study to include querying surrounding communities about how they provide funding for <br />annual street maintenance and reconstruction. In March of 2014, he presented options to the City <br />Council. Council requested staff to analyze funding options against several scenarios. The scenarios <br />were then presented at the May 27, 2014 working session. The Council directed Staff to bring back more <br />information on franchise fees and to present an option for road maintenance in the 2015 General Fund <br /> <br />Page 11 of 30