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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, October 13, 2014 7:00 o’clock p.m. _____________________________________________________________________________________ Page 16 of 21 (9. WATERTOWN ROAD AND MSA FUNDING PRELIMINARY DISCUSSION, Continued) McMillan noted the price of oil is coming down, which should be advantageous to the City. McMillan stated she is not sure whether the City can afford to do the entire project. McMillan noted Stubbs Bay is not an MSA road and that the funds would need to come out of another fund if the City decides to proceed forward with that project. Olson stated the only funds that would have a balance in them are the PIR fund, which has not historically been used for road projects, and the Community Investment Fund, but that those funds will be reduced by the Navarre lighting project. McMillan asked if the City’s general fund is at 50 percent. Olson stated it is typically around 50 percent. McMillan noted the City currently has $1.2 million in MSA funds and that it will take three to four years to get it back up to that amount. Olson stated the majority of the MSA money is going to pay the debt service on the bonds and that it will grow slowly by approximately 20 to 25 thousand per year. Olson stated $867,000 is still in the state fund. Levang asked if the Mayor is thinking the City should not do Section 2. McMillan stated she is questioning how it will be paid for. Printup indicated he is okay with Section 2 if the costs can be reduced somehow and that the residents have been looking to have the roads redone for the past couple of years. McMillan asked if he is suggesting the City go ahead with Stubbs Bay Road now. Printup stated in his view the project can be done in phases. Edwards stated Staff’s recommendation was to do Section 1 in 2015 and then Section 2 the following year. McMillan stated the question that will need to be addressed is how to pay for the project. Levang asked how far the Pavement Management Fund can be drained down to. Olson stated the Pavement Management Fund is basically at zero currently and would require a transfer from another fund. McMillan asked what the City’s policy is for using city funds on an MSA road. McMillan stated the City could bond for the improvements but that, in her view, is a bigger issue. McMillan asked if 2016 is a realistic date for Long Lake to do their portion of the road. Item #02 - CC Agenda - 10/27/2014 Approval of Council Minutes 10/27/14 [Page 16 of 21]