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I <br />Proposed 1998 Annual Budget Continmd <br />The budget also includes $20,000 for special project expenditures which could include fire <br />inspection services, updating the City's Comprehensive Plan, and beginning a fund to finance parks <br />and open space capital projects. <br />Mandated increase <br />A new requirement recently passed by the legislature increases the city's pension contribution from <br />4.48% of gross pay to 5.18%. This w ill increase the city's pension costs by approximately $ 11,000. <br />This new requirement includes a new revenue source to fund it called "Payroll Aid", so the increased <br />expenditures will not require increased property taxes. <br />Capital Projects <br />The 1998 Budget reflects a number of substantial capital projects, ranging from roadway <br />reconstruction to sewer projects to sew'er and water infrastructure replacement projects. <br />Three road reconstruction projects are planned for 1998. These include the County Road 15 project, <br />the County Road 6 project and the Femdale Road project. Each of these three projects is to be <br />funded with MSA funds. The city's current MSA funds are sufficient to fund the County Road 15 <br />and County Road 6 projects. The Femdale Road reconstruction project will require using <br />approximately 1 1/2 years of the city's future MSA allocation. The future years allocation is <br />available to the city at no interest. The city does not have any high priority MSA projects scheduled <br />in the next few years. The next MSA project was to be the reconstruction of the Willow Drive <br />bridge. However, this has been eliminated from the city's MSA plan because it will be accomplished <br />as part of the Highway 12 upgrade project. <br />The City Council has authorized the preparation of feasibility reports for providing sewer service <br />to two sewer hot spot areas in 1998. These projects would both be 100% funded by special <br />assessments. <br />The budget also includes the rehabilitation of the Navarre w ater plant. This project is necessarj' to <br />enable the plant to continue to provide iron and manganese removal and water softening. This <br />project will be funded by a combination of Water f und reserves, an internal loan to be repaid by <br />Water Fund operating revenues, and special assessments on properties in the Navarre water service <br />area. <br />ir <br />Funding for Mqior Infrastructure Rehabilitation/Construction <br />The 1998 budget follows the direction set by recent budgets toward putting the city into a better <br />position to address both current and long term needs for infrastructure rehabilitation/construction. <br />The three main areas of infrastructure rehabilitation/construction are sewer and water infrastmeture, <br />street infrastructure, and stomi drainage infrastructure.