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City of Sioux City, Iowa Capital Improvement Program Fiscal Year 2019-2023 Approved

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City of Sioux City, Iowa Capital Improvement Program Fiscal Year 2019-2023 Approved City of Sioux City, Iowa Capital Improvement Program Fiscal Year 2019-2023 Approved www.sioux-city.org March 19, 2018 Honorable Mayor, Members of the City Council, and Citizens of Sioux City: We are pleased to submit the FY 2019 – 2023 Approved Capital Improvement Program (CIP) for your review. This five-year program provides a summary of major upcoming improvement projects planned for our City. The CIP plans for and funds the major capital costs required to improve our infrastructure and support development throughout Sioux City. We feel that this CIP furthers our commitment to the following goals: Improving the quality of life for our citizens Sustaining the community’s infrastructure and facilities Creating development opportunities to stimulate economic growth Leveraging financial tools including available debt capacity responsibly Improving the quality of life for our citizens while being financially responsible is the top priority. The CIP includes projects designed to maintain and improve the City’s core infrastructure, improve park facilities and support economic development. These projects will all have a positive impact on our residents. Each project included in this Approved CIP has been carefully reviewed by City Staff to ensure that it meets the objectives of the program. The costs, funding sources, property tax, utility rate impact, and the overall impact to Sioux City residents and businesses were all factors carefully considered before finalizing this Approved CIP. This five-year program is reviewed each year and adjusted as the infrastructure and development needs of Sioux City change. Large development projects or increases in grant funding may cause fluctuations in the City’s annual capital spending. Only the first year of this five-year plan is incorporated into the final FY 2019 Budget. The process of balancing funding requests to arrive at the Approved CIP was challenging and difficult decisions were made in recommending the various projects to you. While major infrastructure projects involve significant costs, deferred maintenance can lead to larger liabilities in the future. City staff is committed to making responsible recommendations that balance the needs of our community with the desire to limit property taxes and utility rates. This CIP provides the appropriate maintenance to the City’s current assets intended to limit major infrastructure costs while still providing the City with improved recreational activities and economic development opportunities. OFFICE OF THE CITY MANAGER 405 6th Street P.O. Box 447 Sioux City, IA 51102 PH 712-279-6102 FAX 712-279-6105 WEB www.sioux-city.org Within the Approved CIP, you will find an overview of the CIP process and a summary of the FY 2019 – 2023 Program. Much of the data and analysis used to balance this program are included in the financial plan and revenue sources sections. The majority of the document is made up of individual project sheets that provide a detailed description of the work being completed and how it relates to the City’s strategic plan. In the back of the document you will find an index of projects and their page numbers. We are grateful to the Capital Improvements Program Peer Review Committee for their efforts in reviewing the CIP and assisting in the development of this approved program. I thank Department Directors and staff for their commitment to this process and the Finance staff for their efforts in developing the Approved Capital Improvement Program. Most importantly, I want to acknowledge our appreciation to the members of the City Council for their continued support and guidance in establishing and maintaining worthwhile City services while being mindful of sound fiscal policy. Respectfully Submitted, Robert K. Padmore Donna Forker City Manager Finance Director ii CAPITAL IMPROVEMENT PROGRAM PROCESS The Capital Improvement Program (CIP) budget process begins with the department submission of requests to the Finance Department. Following review by Finance, the CIP Peer Review Committee, representing various City departments, analyzes projects and presents a balanced Capital Improvement Program to the City Manager. The City Manager considers the Peer Review Committee’s recommendations and meets with all Department Directors regarding CIP requests. After considering all the information, the Capital Improvement Plan is recommended to the City Council. The Planning and Zoning Commission has the opportunity to review the CIP during public hearings. Public capital hearings are conducted and each individual department presents their projects. This approach allows Council to receive the best possible explanation for each project and presents the opportunity for Citizen input. Council then conducts a final public hearing to approve the CIP in late February or early March. The final public hearing held approves only the first year CIP budget of this five-year plan. The CIP budget process starts over each July 1 at which time all projects are reviewed and may be adjusted for new cost estimates or otherwise modified due to new City developments. OVERVIEW OF THE FY 2019 – 2023 CAPITAL IMPROVEMENT PROGRAM The first-year budget of the Approved FY 2019 – 2023 Capital Improvement Program totals $98,340,871, an increase of $30,462,250 (44.9%) from the Approved FY 2018 Capital Program of $67,878,621. The Approved FY 2019 - 2023 Five Year Capital Program totals $344,909,338, representing an increase of $52,803,768 (18.1%) from the Approved FY 2018 – 2022 Capital Program of $292,105,570. This Approved Capital Improvement Program reflects the prudent investments necessary to sustain the City’s infrastructure and provide for the economic development of the City. Because of the large amount of funds requested for various projects and the need to maintain prudent debt ratios, priorities had to be established. These priorities included: Meeting existing commitments Funding the future development of the community Funding the replacement of infrastructure Effect on the operating budget In simple terms, nearly all the projects will benefit the community by generating increased tax revenue through development opportunities, reducing operating costs, or replacing and repairing deteriorated infrastructure. As has been noted in prior capital budget presentations, the age of Sioux City’s infrastructure is significant and updates are needed. Old infrastructure requires additional maintenance and infrastructure failures can lead to liability claims. A fundamental infrastructure replacement goal of this CIP is to keep the average age of streets, sewers, and water lines from lengthening. The Approved Capital Improvement Program continues to recommend the financing of economic development projects. Without growth in the tax increment areas, our tax base and sales tax revenue, cuts in basic operating services would be required. The City continues to invest in infrastructure that will promote development. Development projects are generally those projects that are expected to pay for themselves over a reasonable period (generally 5-8 years) and maintain Sioux City as a commercial and industrial leader in this region. This status and the revenue it generates are essential in funding basic services and reducing the property tax burden over the long-term. iii SUMMARY OF EXPENDITURES FY 2019 – 2023 CIP EXPENDITURES BY CATEGORY The approved first year expenditures included in this five-year program total $98,340,871 and the approved expenditures for the five-year program total $344,909,338. The charts below show the approved total first year expenditures and total program expenditures by category. Approved CIP Funding Sources Programmed CIP Funding Sources FY 2019 (First Year Only) FY 2019 ‐ 2023 (Total Program) SRF Debt Sewer Tax Increment 31% Sales Tax 6% 1% SRF Debt Water 4% Other 19% 4% 7% Casino Sewer 0% Tax Increment 4% 1% G.O. Bonds Sales Tax Water (Debt Levy) 2% Grant 6% 23% 17% Other Casino 9% 1% G.O. Bonds G.O. Bonds (Revenue (TIF Abated) Grant Abated) 7% 17% G.O. Bonds 2% G.O. Bonds (TIF Abated) G.O. Bonds (Debt Levy) 7% (Revenue Abated) 28% 4% MAJOR PROJECTS A major portion of the City’s capital expenditures are for street improvement related projects. Examples of street projects include complete reconstruction including underground utilities, asphalt resurfacing, curb and gutter improvements, median enhancements, street lighting and traffic control. In FY 2019, a $9 million Airport runway reconstruction project that will be 90% grant funded caused the Airport to be a major category of expenditures. Other major projects included in this five-year program include Riverfront recreational upgrades, Waste Water Treatment Plant (WWTP) capacity expansion, and providing equipment to clean and compress biogas being generated from the WWTP which will make it a source of revenue. Top 10 Major Projects Project # Amount Years Budgeted Page # Annual Infrastructure Reconstruction 719-133 $47,500,000 FY 2019 - FY 2023 325 Annual Airport Capital Projects 749-084 20,825,000 FY 2019 - FY 2023 388 WWTP Asset Renewal/Modifications 539-117 16,788,600 FY 2019 - FY 2023 200 Riverfront Recreational Upgrades 459-136 15,700,000 FY 2019 - FY 2021 132 Annual Resurfacing 719-121 11,500,000 FY 2019 - FY 2023 320 Annual Bridge Repairs 719-138 11,208,000 FY 2019 - FY 2023 330 Downtown/3rd & Pearl Development 663-233 11,000,000 FY 2019 277 WWTP Capacity Expansion 539-223 9,898,000 FY 2021 223 Reconst. of Bacon Creek Channel 539-003 9,790,496 FY 2021 - FY 2023 194 Hoeven Valley Infrastructure Dvlpmt 663-053 9,300,000 FY 2022 - FY 2023 258 iv SUMMARY OF REVENUES FY 2019 – 2023 CIP FUNDING SOURCES The total approved first year expenses of $98,340,871 are funded with both City and non-City resources. City resources include General Obligation (G.O.) debt proceeds, which are repaid using property tax revenues, water and sewer utility funding, and other sources generated through City operations. Non-City resources are primarily grants and donations received from outside agencies.
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