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Full Agenda Packet CITY OF JANESVILLE CITY COUNCIL SPECIAL MEETING (CITY COUNCIL RETREAT) TUESDAY, JUNE 19, 2012 8:00 A.M. (Rotary Gardens – 1455 Palmer Drive; Janesville, WI) 1.Call to Order. 2.Roll Call. 3.Overview of retreat objectives. 4.Possible action to establish Council short-term and long-term goals. 5.Possible action to establish Council objectives for upcoming budget. A.Overview of General Fund for 2013 budget year & status of capital program. 6.Motion to adjourn. CITY MANAGER’S MEMORANDUM June 13, 2012 TO: Council President Voskuil & City Council FROM: Eric J. Levitt, City Manager SUBJECT: City Council Retreat Scheduled for June 19, 2012. I want to thank each of you for taking the time to participate in the City Council retreat on Tuesday. Because of the importance of this retreat in setting the stage for the City moving forward over the next year, I have asked Diane Pillard to facilitate the retreat. The retreat is being broken into three sections. 1.The retreat will begin with an overview of the retreat objectives and general discussion led by the facilitator. 2.The second part of the retreat which will encompass most of the day will be comprised of short-term and long-term goal setting. The only preparation that we are requesting prior to the meeting is for each of you to consider what you believe to be the key priorities the City should be working on moving forward into the future. In order to provide meaningful goal setting, the City Manager plans to have a meeting with department directors and direct reports after the retreat to establish revisions to the work plan to provide objectives to be accomplished in each priority category as established by the Council. The goal setting process will be led by the facilitator who will provide the parameters and the methodology at the retreat. We will bring back those objectives interconnected to priorities at a Council meeting later in the summer. 3.The final element of the retreat will be for staff to provide an overview of the financial projections. The City Manager will be looking for some parameters from the Council on 2013 budget objectives. These objectives include broad subjects such as:  Limits on Property Tax Levy.  Addressing infrastructure improvements such as Street Paving program.  Implementing some of the goals in the first part of the retreat in the budget component.  Future Capital program or debt service structure goals. 1 While as a City we are looking to the future at this retreat, I want to reflect on a few of the key accomplishments that have occurred over the last four years while facing difficult economic times.  The City has begun to respond with some positive signs to loss of over 6,000 jobs that occurred in 2008 and 2009. At the end of 2011 the City had seen a growth of over 700 jobs from the creation of new jobs in existing companies and new companies relocating to Janesville.  The City has been working aggressively on diversifying businesses in Janesville through more aggressive marketing, and the announcement of recent expansions and relocations have occurred due in part to this.  The City received Federal assistance in the creation of a manufacturing incubator and initiating a more proactive brownfields program with over $1.5 in Federal assistance.  The City Certified one of its Industrial Parks.  The City has expanded its housing programs to continue to renew its core neighborhoods. Janesville has successfully demolished or rehabbed over 25 homes, participated financially in the rehabbing of over 35 homes and increased home- ownership opportunities with 70 households receiving down payment assistance.  The Police Department has been recognized for multiple programs including its domestic violence program.  The Fire Department has been maintained service levels despite the economic downturn.  In Leisure Services, the Senior Center was accredited for the first time.  Janesville Transit has expanded service to Whitewater through a partnership.  We have created multiple jurisdiction partnerships including initiatives through Public Works and Community Development.  The Wastewater Treatment Plant has been recognized in the State for its construction project including adding multiple sustainable initiatives.  The City launched a new website.  The City has decreased personnel costs between 2009 and 2012. 2 I want to conclude by stating that while we will continue to face many challenges, as I look back I see many successes that have occurred and believe the future looks positive for Janesville. I have included a few attachments. The attachments include:  A 2013 Initial Budget Macro.  The current 5-year debt service graph.  The 3-Year Street Rehabilitation Program memorandum  The current staff work plan will be sent out separately on Monday. 3 City of Janesville Budget Gap 6/11/2012 First MacroCurrent Proposed ProjectionProjectionBudget Revenue Changes: State Shared Revenues$ - Transportation Aids (210,000) Transfers In (TIF #3) (160,000) Interest on Investments - Permits and Fees 10,000 Water Utility Taxes (17,000) Fire Department Service Fees 65,000 Wheeltax (50,000) Subtotal for Revenue Changes$ (362,000)$ -$ - Expenditure Changes: Wages and Wage Driven Fringes$ -(1) Health Insurance - Fully Fund Partially Funded Positions 400,000 Elections (40,000) Assessor Revaluation 40,000 Ice Skating Center Open Full Year 10,000 Ambulance Billing Contract 10,000 Animal Control - Utility Increases 20,000 Vehicle Operations and Maintenance 30,000 Liability and Worker's Comp. Insurance - Special Assessment Subsidy 350,000(2) Subtotal for Expenditure Changes$ 820,000$ -$ - Deficit w/o Levy Increase $ 1,182,000 Max Levy Increase - Assumes 0.5% growth, and .227% incresase from closure of TIF 3 & 16 210,000 - - Additional Applied Fund Balance - - - $ 972,000$ -$ - Budget Gap All union contracts expire 12/31/2012. Negotiations have not commenced and parameters have not been (1) established by the City Council. This is a very preliminary number and will need further refinement. (2) ɔ£—£†Â”`ÃZІêІ”`à 243-243.243/24302431243224332434244+244,244-244.244/24402441 ®x x3Ë444Ë444 x2Ë444Ë444 x1Ë444Ë444 x0Ë444Ë444 x/Ë444Ë444 x.Ë444Ë444 x-Ë444Ë444 x,Ë444Ë444 x+Ë444Ë444 ùª”±úkª†Â”`à City of Janesville 3 Year Street Rehabilitation Program Executive Summary: A major responsibility of any municipality is to manage and maintain its street pavements. Because of the magnitude of this responsibility, it is prudent to periodically inspect those pavements in a comprehensive and consistent manner. The City of Janesville does this on a two year basis, most recently in 2011. Utilizing a State transportation planning assistance grant, City staff has reviewed and analyzed the data from the 2011 street condition survey along with other data related to the recent history of the City’s street expansion and rehabilitation efforts. The analysis included projecting the long term trend of City street conditions based on various repair strategies. Through the above analyses, staff found that the recent level of effort to maintain our streets is less than in the preceding decade. The effect of this trend is magnified by increases in paving costs and the growth and aging of our City’s streets. The building boom of the last two decades will begin to impact our street maintenance needs in a very significant way as the multitude of streets built during those years reach the age where significant maintenance is needed before the pavement system fails. Staff believes that the current level of investment is inadequate to maintain an overall acceptable condition of the City’s street network. The following report describes the data and rational that led to this conclusion. Several options to address this issue are proposed at the end of the report for Council consideration as well as a staff recommendation to counter the projected downward trend of pavement conditions. Purpose: As stated in the City of Janesville Annual Budget, the goal of the Street Maintenance program is “To maintain all City roadways in a condition that provides for safe and efficient use by the public”. While street maintenance includes routine items such as joint/crack sealing, pothole patching and limited surface repairs, the largest cost element of Street Maintenance is pavement Resurfacing/Reconstruction. Reconstruction is undertaken when both the street surface and base have reached the end of their useful life. It involves total removal of the pavement surface as well as the base and typically involves the total replacement of curb and gutter and driveway aprons as well. Resurfacing restores the riding surface while retaining and continuing to use the balance of the structure. Typically a 1.5” to 2” asphalt surface layer is applied between the edges of the gutter flanges. Depending on the condition of the road, some base repair along w/ intermittent curb and gutter replacement may be included. Typically, the existing surface is milled to maintain an appropriate cross section as well as to remove surface distresses. It is desirable to plan resurfacing and reconstruction projects well in advance for a number of reasons including:  Coordination of utility repairs  Fiscal planning  Public notification  Utilization of outside funding sources The goal of this plan is to develop a process for evaluating the condition of the individual blocks as well as the street system as a whole, prioritizing streets to be improved and determining the level of investment appropriate to maintain an acceptable level of service for the City’s pavements. Condition Evaluation: Recently, the State of Wisconsin has mandated surface evaluations of to be reported every two years. The State developed a free software program called The Wisconsin Information System for Local Roads (WISLR) to manage the data collected and recommended use of a more intuitive rating system called Pavement Surface Evaluation and Rating (PASER). The vast majority of municipalities in Wisconsin utilize the PASER system of ratings which meshes with the WISLR software. Under the PASER rating system, each block is visually inspected and rated in the following categories:  10 – 9 Excellent  8 Very Good  7 -6 Good  5-4 Fair  3 Poor  2 Very Poor  1 Failed The City has completed two PASER evaluations, first in 2009 and most recently in 2011. The results of those first two surveys are summarized in the following chart. 2009 & 2011 PASER Ratings Compared 160 140 120 100 80 Miles 2009 60 2011 40 20 0 FailedVery PoorPoorFairGoodVery GoodExcellent Prioritization: Utilizing the condition ratings obtained in the most recent PASER evaluation, candidates can certainly be selected from the lowest rated streets. However, simply picking from the bottom of a list sorted by rating will not result in the most cost effective program. The following factors should be considered as well:  Coordination with needed utility improvements  Timing of available grant funds  Grouping of blocks cohesively (For example: If there is a block rated Fair between or adjacent to blocks rated Poor it is more cost effective to group the blocks in a logical multi block segment).  Street classification/traffic volume  Streets which are no longer candidates for resurfacing due to base failure may be deferred until reconstruction because base preservation is no longer a concern. Timing of Resurfacing: National studies of pavement condition and deterioration have found that pavements do not deteriorate in a straight line fashion when plotting condition vs. age. Rather they tend to deteriorate slowly in the first few years after construction or rehabilitation and then the rate of deterioration tends to accelerate later in the pavement life. That is due to the fact that, as the driving surface weakens and cracks, the pavement base begins to be more impacted by traffic loading, moisture and freeze thaw cycles. When the base weakens, wide cracks, dips and potholes become more prominent which, in turn, cause further fatigue of the base. In addition, asphalt pavements tend to lose oil (dry out) as they age, making them more brittle. A representation of the deterioration pattern of pavements is shown in the following chart. Considering the deterioration pattern described above, a desirable strategy for scheduling pavement resurfacing is to schedule a resurfacing when the pavement is still in fair condition. This will protect the pavement base and allow the pavement life to be extended at a much lower unit cost than if the pavement is allowed to deteriorate to a poor condition. Janesville’s Rating Experience A review of the latest rating data indicates that Janesville’s streets tend, on average, to follow the pattern shown above. As would be expected, our streets which have been recently constructed or resurfaced rate as excellent, then drop in rating on average as shown below: Rating Years Since Improvement Excellent 0 to 10 Very Good 10 to 17 Good 17 to 22 Fair 22 to 26 Poor 26 to 29 Very Poor 29 to 30 Failed 30 + As shown, while it takes about 22 years to deteriorate from Excellent to Fair, it only takes another 8 years for a street to drop to Failed. If streets could be resurfaced within about 25 years of the last major improvement, we could expect the system as a whole to remain in Fair or better condition. (The arterial streets, which are subjected to more numerous and heavier loads, may be expected to deteriorate more quickly than the trend describe above.) Factors affecting the Success of Janesville’s Pavement Management Program Growth of the System As the City has grown over the years, the street network has grown with it. The streets which were built in the 80’s are the ones which are reaching the age where we would expect their condition to degrade to Poor or worse without resurfacing. In the decade ahead, the streets which were built in the 90’s will reach this age. The 80’s were a relatively quiet time for development with only 21 miles of streets constructed. By contrast, the 90’s and 2000’s saw 43 and 42 miles constructed respectively. As such, we can expect the streets in need of improvement to accelerate in the years to come as the streets built in the 90’s begin to drop below Fair condition. Increased Construction Unit Costs In the past 10 years the cost of asphalt on City contracts has risen by 95%. The cost of curb and gutter replacement has risen by 68%. During the same 10 years, the Consumer Price Index rose by 21%. So the cost of our resurfacing program has risen significantly more than inflation. As such, we get fewer miles of streets completed for the same dollars invested. Pavement Cost Trends $50.00 $45.00 $40.00 $35.00 $30.00 Avg Asphalt $25.00 C&G $20.00 CPI $15.00 $10.00 $5.00 $- 2002200320042005200620072008200920102011 Reduction in Miles of Streets Rehabilitated In recent years, pavement rehabilitation has been reduced in comparison to previous years. The following is a summary of the street rehabilitation completed since the year 2000. Annual Street Rehabilitation Program 16 14 12 10 Miles 8 6 4 2 0 200020012002200320042005200620072008200920102011 Year Increased Cost per Mile Resurfaced The result of reduced rehabilitation described above will result in future programs dealing with lower rated streets. As the average condition of the streets we address with the resurfacing program declines, the cost per mile goes up. National studies have shown that the cost to restore a Very Poor street will be 4 to 5 times that of a Fair street. This is due to the need for more significant base repair and is described graphically in the chart below. Also, Janesville made a decision a few years ago to stop paving over gutter pans. While this will decrease maintenance cost over time due to less pavement failure along street edges, consequently, the cost for increased curb replacement has driven up the cost per mile of the resurfacing program. Reduced Grant Fund Availability Due to funding issues on the State and Federal level, the availability of funds under the LRIP and STP programs has not kept pace with the increased cost of street improvements. In the past 10 years the available grant funding for street improvements has actually decreased by about 1%. Options for Program Strategies A.Level Funding In 2011, funding for the resurfacing program included $950,000 in borrowed funds and $362,000 in Operating Funds. If this amount of funding is continued in future budget years, approximately five miles per year could be improved. The City has historically received adequate grant funding through the State Local Road Improvement Program (LRIP) and the Federal Surface Transportation Program (STP) to improve on average 1 additional mile per year. After completion of the 2011 Resurfacing Contract and based on the 2011 PASER pavement survey, the City street network will have 311 miles of streets rated Fair to Excellent and 18 miles rated Poor or Very Poor. Based on this level funding strategy and a typical rate of deterioration, by 2021 the network would have only 160 miles of streets rated Fair or better and 169 miles rated Poor or less. Clearly this results in a severely deteriorated street network. Option A 400 Number of Miles 300 Fair to Excellent 200 100 Poor to Failed 0 2012201520182021 B.Improve all Streets Rated Poor or Less (including adjacent Fair Streets) Under this option, each three year plan would resurface all streets rated Poor or less as well as 10% of the Fair Streets. Based on this strategy addressing all Poor or worse rated streets and adjacent Fair rated blocks, and a typical rate of deterioration, by 2021 the network would have 291 miles of streets rated Fair or better and 38 miles rated Poor or less but the trend would be starting to improve. However, this would require resurfacing of only 10 miles per year in the first three year plan, years six thru nine would require over 25 miles per year in the mid years to keep up w/ the aging streets. Option B 400 Number of Miles 300 Fair to Excellent 200 100Poor to Failed 0 2012201520182021 C.Program a Level Mileage based on a 25 year Pavement Life Under this option, consideration was given to the average number of years it takes for a street to deteriorate to Poor condition. Based on an analysis of the PASER ratings as related to pavement age, this is estimated to be about 25 years. If the City were to simply divide the total miles of streets in the network by a 25 year life of Fair or better condition, this option would require th resurfacing about 14 miles per year. Based on this strategy of resurfacing 1/25 of all streets each year, and a typical rate of deterioration, by 2021 the network would have 237 miles of streets rated Fair or better and 93 miles rated Poor or less. Option C 400 Number of Miles 300 Fair to 200 Excellent Poor to Failed 100 0 2012201520182021 Recommendation In order to keep pace with the City’s aging street network, it is recommended that the annual street rehabilitation program be increased to include about 15 miles per year initially and that this level of improvement be reassessed in 2013 after the next pavement rating survey is completed. If at that time the condition of the overall street network continues to decline, the pavement improvements should again be adjusted to keep the majority of the street network in a condition of Fair or better.