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I <br />TO: <br />FROM: <br />DATE: <br />Mayor and City Couik U <br />Ron Moorse. City Administratorinistrator <br />May 20. 1994 <br />SUBJECT: Funding Sources for MSA Roadway Reconstruction Costs Not Covered By MSA <br />Funds <br />Municipal State Aid (MSA) funds cover approximately 93% of the costs of reconstructing an <br />MSA roadway. In the case of the North Brown Road project, three items are not fully eligible <br />for MSA funding. <br />1. Storm sewer: 40% of the storm sewer costs are not covered ($38,550) <br />2. Bike/Hike trail: 20% of the bike trail costs are not covered ($5,150) <br />3. Easement acquisition: the m.ijority of easement acquisition costs are not covered. <br />As the city continues to reconstruct its MSA roads as part of a long term program these types <br />of costs will continue to be unfunded by MSA. The city needs to have a policy to guide how <br />these costs arc to be funded. <br />Bike Trail Costs <br />The portion of the bike trail costs not covered by MSA funding can easily be covered using park <br />dedication funds. <br />Storm Sewer and Easement Acquisition Costs <br />The stonn sewer and ea.scment acquisition costs can be funded through several alternative <br />sources. <br />1. General property taxes could be used to create a fund specifically to cover these <br />costs. <br />2.Special assessments: the properties benefitting from the project could be assessed <br />to cover the excess costs. <br />3.The city could create a storm water utility. This involves each parcel paying an <br />annual fee similar to the water and sewer utilities. The fee is based on the <br />amount of hardcover and storm water run-off generated by the hardcover. This <br />fee revenue would then be used to create a fund to pay for storm drainage <br />improvements including those related to the MSA projects.