HomeMy WebLinkAbout13.A.1. 2011 Street Overlay ProgramTO:
FROM:
SUBJECT:
DATE:
INTRODUCTION:
Mayor & City Council
Mark McNeill, City Administrator
Bruce Loney, Public Works Director
Gregg Voxland, Finance Director
2011 Street Overlay Program
February 15, 2011
This memo is a follow -up on the discussion of long term capital financing from the
January 18, 2011 and February 1, 2011 meetings.
BACKGROUND:
From the February 1, 2011 Council meeting, the Council directed staff to bring back
information on overlay projects for 2011 and beyond.
On bituminous overlays, in 2006 staff did present a 2006 Pavement Management System
report on the future needs of maintaining pavements by seal coating, bituminous overlays
and street reconstructions. Staff has recommended the City should spend for the next
five years an amount of $780,000.00 per year for overlays.
Also, staff pointed that 45% of Shakopee streets have been built from 1995 to 2005. An
average of 6 5 miles of streets were constructed per year and will fall in the overlay
category starting in 2016.
The 2006 Pavement Report did recommend at some point to decrease or eliminate
reconstructions and concentrate on the overlay "Bubble" from the 1995 -2005 major
construction years.
The overlay bubble is shown as follows:
• 1995 -1999
• 2000 -2004
CITY OF SHAKOPEE
Memorandum
33.76 miles
31.28 miles
The goal of the overlay program is to keep pavements from going to the reconstruction
category as long as possible.
Staff has developed a comparison of costs between overlays, remove & replace pavement
and total reconstructions as follows:
Bituminous Overlays = $1
Remove & Replace Pavement = $2.4
Total Reconstruction = $5.00
This comparison is to show that the initial overlay cost is a 1 to 2.4 ratio to a remove and
replace pavement project and a 1 to 5 ratio to a total reconstruction project. The point of
this is to show that overlays can be a cost effective measure in extending the life of a
pavement.
Other discussion points asked of staff by the Council include splitting up the project for
2011. If Council desires to split the project, staff would recommend to do Vierling Drive
and streets north of Vierling Drive and east of Marschall Road. Staff does not
recommend splitting the areas as a larger project usually has better bid prices and
delaying an area would increase the backlog of streets in future years.
On the question of assessing overlays, staff presented information on June 15, 2010 for
not assessing and Council approved Resolution No. 7025 on August 17, 2010 to amend
the Special Assessment Policy.
To assess bituminous overlays and then bond for the improvement would be more
expensive due to bonding and assessing costs, per Gregg Voxland's memo on January 12,
2011 for the January 18, 2011 meeting on street overlays. A CIF projected cash level
showing a tax levy — overlay amounts and 30% assess amounts is provided to show the
impact of assessments to no assessments. See attachments.
Council should provide direction on how they want to finance bituminous overlay
projects in order to make a decision on the 2011 project. If Council desires to change the
Assessment Policy, it is unlikely staff can follow the public process in time to get good
bids this spring.
ALTERNATIVES:
1. Proceed with the 2011 bituminous overlay project under current policy — no
assessments.
2. Do not do an overlay project in 2011.
3. Direct staff on how to proceed on for an overlay project in 2011.
RECOMMENDATION:
Staff recommends alternatives No. 1.
ACTION REQUESTED:
Move to proceed on the 2011 bituminous overlay project according to current policy.
Gregg oxla d ' : race Lon .E.
Finance Director
ENGR/2011- PROJECTS /2011- COUNCIIJO VERLAY- DISCUSSION
Public Works Director
City of Shakopee Street Overlays
No Assessments (Recommended)
2011 2012 2013 2014 2015 Total
Total project cost $880,000 $1,550,000 $280,000 $270,000 $1,680,000 $4,660,000
storm drainage 70,000 80,000 20,000 20,000 70,000 260,000
tax levy - collect following year 100,000 150,000 200,000 250,000 300,000 1,000,000
CIF 710,000 1,320,000 60,000 - 1,310,000 3,400,000
Assessments - -
Net cash impact
Assess 30% (Funding as it was
done previously) bonding
Total project cost 910,000 1,580,000 310,000 300,000 1,710,000 4,810,000
storm drainage 70,000 80,000 20,000 20,000 70,000 260,000
tax levy - bond proceeds 588,000 1,050,000 203,000 196,000 1,148,000 3,185,000
CIF - - -
Assessments 252,000 450,000 87,000 84,000 492,000 1,365,000
Net cash impact 0 0 0 0 0
Tax Levy for bonds 136,000 379,000 425,000 470,000 741,000
Assess 20% no bonds
Total project cost 910,000 1,580,000 310,000 300,000 1,710,000 4,810,000
storm drainage 70,000 80,000 20,000 20,000 70,000 260,000
tax levy - collect following year 100,000 150,000 200,000 250,000 300,000 1,000,000
CIF 572,000 1,050,000 32,000 (26,000) 1,012,000 2,640,000
Assessments 168,000 300,000 58,000 56,000 328,000 910,000
Net cash impact
(810,000) (1,370,000) (110,000) (50,000) (1,360,000) (3,700,000)
(840,000) (1,366,400) (46,400) 25,200 (1,273,600) (3,501,200)
Assess 30% no bonds
Total project cost 910,000 1,580,000 310,000 300,000 1,710,000 4,810,000
storm drainage 70,000 80,000 20,000 20,000 70,000 260,000
tax levy - collect following year 100,000 150,000 200,000 250,000 300,000 1,000,000
CIF 488,000 900,000 3,000 (54,000) 848,000 2,185,000
Assessments 252,000 450,000 87,000 84,000 492,000 1,365,000
Net cash impact
(840,000) (1,349,600) 400 77,800 (1,215,400) (3,326,800)
CIF tax levy 100,000 150,000 200,000 250,000 300,000 1,000,000
Debt tax levy 136,000 379,000 425,000 470,000 741,000 2,151,000
Difference = CIF funding
2/10/20113:54 PM H: \BUDGET \Budgetll \Cip11 \LT capital finance \Long Term Forcast B
TTAC4MEPr A
Capital Improvement Fund
Projected Cash Levels
2011 -2015 Capital Improvement Program
City of Shakopee, Minnesota
Sources
Tax Levy - Overlay
Tax Levy
Special Assessments
Special Assess. Reclamation 4th ave
Special Assess. Reclamation Hillside
Special Assess £ Overlay 30% `
Intergovernmental
SPUC
Interest
Total Revenue
EXPENDITURES:
Expenditures
2011 Recon (CIF share)
CR 18 Trail
Stagecoach /CR101 signal
CR 69
CR 101 Trail Ext
12th Ave Trail
CR 83 pmt (2009 county project)
Overlay
Reclamation
Total Expenditures
OTHER FINANCING SOURCE (USE)
Transfers In
Sewer
Storm - Overlay
Transfers Out
Levv "Buv D
Total Other Financing Source (Use)
Excess (Deficiency)
Cash Balance January 1
Balance 12/31
2011
12,000
579,000
119,560
710,560
130,000
35,000
75,000
880,000
1,120,000
70,000
(394,280)
(324,280)
(733,720)
5,535,000
$ 4,801,280
2/11/20119:00 AM H: \BUDGET \Budgetll \Cip11 \LT capital finance \Long Term Forcast B
AffilePli
City of Shakopee Capital Improvement Program 2011 -2015
Project Manager:
Bruce Loney
A. Expenditure Items:
Land &ROW
'Construction
Improvements
Engineering /Admin.
Total
B. Funding Source:
General Fund
Capital Improvement Fund
Park Reserve Fund
Grants (specify)
Donations (specify)
State Aid
Assessments
Sanitary Sewer Fund-Base
Sanitary Sewer Fund -Trunk
Storm Drainage Fund -Base
Storm Drainage Fund -Trunk
Tax Levy
Total
Project Type:
Street Construction
2011
430,000
80,000
510,000
510,000
510,000
2012
PROJECT LOCATION
Project Title:
2011 Overlay A
2013
2014
Total Project Cost:
$510,000
2015
Description:
Bituminous overlay of 2nd Avenue and 3rd Avenue, from Atwood Street to
Spencer Street; 1st Avenue, from Holmes Street to Sommerville Street; Atwood
Street, Fuller Street, Lewis Street and Sommerville Street, from 1st Avenue to
4th Avenue; and Holmes Street, from 1st Avenue to 3rd Avenue.
Justification:
Continuation of the City's Pavement Preservation Program to maintain existing
infrastructure.
Other Comments:
Bituminous overlays are much more cost effective than reconstructing
pavements. Streets will be evaluated each year and may be moved up or moved
back in the CIP.
Operating Costs:
City of Shakopee Capital Improvement Program 2011 -2015
Project Manager:
Bruce Loney
A. Expenditure Items:
Land & ROW
Construction
Improvements
Engineering /Admin.
Total
B. Funding Source:
General Fund
Capital Improvement Fund
Park Reserve Fund
Grants (specify)
Donations (specify)
State Aid
Assessments
Sanitary Sewer Fund -Base
Sanitary Sewer Fund -Trunk
Storm Drainage Fund -Base
Storm Drainage Fund -Trunk
Tax Levy
Total
Project Type:
Street Construction
2011
480,000
70,000
550,000
550,000
550,000
2012
PROJECT LOCATION
Project Title:
2011 Overlay B
2013
2014
Total Project Cost:
$550,000
2015
Description:
Bituminous Overlay of Ruby Lane, Ruby Circle, Granite Drive, Granite Court and
Sapphire Lane, from Vierling Drive to Murphy Avenue; Heritage Drive, from
Vierling Drive to Onyx Drive, Ramsey St., Dallas Dr., Swift Cir.; and Vierling
Drive, from Limestone Drive to Ramsey Street.
Justification:
Continuation of the City's Pavement Preservation Program to maintain existing
infrastructure.
Other Comments:
Streets will be evaluated each year and may be moved up or moved back in the
CIP.
Operating Costs:
SHAKOPEE PAVEMENT
MANAGEMENT
SYSTEM
JULY, 2006
SHAKOPEE
COMMUNITY PRIDE SINCE 1857
PURPOSE:
City of Shakopee Pavement Management Program
This report is to update the Council of the City's pavement condition and for
consideration of a policy to implement a City -Wide Pavement Management Program.
This program is to maintain and upgrade the City's street system as it ages and is utilized
by its residents and property owners. The overall goal of the program is to provide a safe
and usable local transportation system, whereby each street is meeting an acceptable
standard condition and doing so in a cost effective fashion. The specific objectives of the
Pavement Management Program are:
1. Continue to reconstruct streets and utilities that have deteriorated beyond the
point of its useful life.
2. Increase the amount of funding for bituminous overlays of City streets.
Streets can be overlaid at a 1:5 cost ratio to reconstruction of street.
3. Increase the funding for seal coats to preserve the life of pavements as a
pavement management strategy.
4. Replacement of utilities including service lines on street reconstruction
projects which is recommended to be paid at 100% from user fees collected
from monthly utility bills.
5. Consider increasing street assessments from 25% to 30% or more to help fund
Pavement Management Program.
6. Develop an implementation strategy for collector streets and one for local
streets.
7. Utilize State Aid funds for pavement maintenance projects such as seal coats,
overlays and reconstruction of State Aid streets.
For bituminous pavements, a range of maintenance operations are proposed to upgrade
the streets to an acceptable standard over the useful life of the pavement. Development
of the Pavement Management System and maintenance strategies must include a
financing component that allows the City at large, as well as property owners, to absorb
the improvement costs. In the City of Shakopee, the street system represents a major
financial investment of over 120 million dollars. The condition of neighborhood streets
can directly impact property values, as well as reflecting a sense of the Community's
livability.
1
BACKGROUND:
City of Shakopee Pavement Management Program
Shakopee's street system has developed over a period of almost 150 years. The "Old
Shakopee" street system is a grid system and is the area where most of the street
reconstructions have occurred since 1980. Approximately 45% of the local streets have
been built since 1996 when the T.H. 169 bridge and freeway was constructed.
At present, staff has determined that the 138.1 miles of street could be placed in the
following categories:
• Street Reconstruction — 11 miles
• Overlays — 31 miles
• Seal Coats — 98 miles
At this time, there is a large inventory of streets in the seal coat category and these streets
in time will move to the bituminous overlay category.
Current/Evaluation /Maintenance Strategies:
The life cycle of a bituminous pavement is particularly dependent on a series of
maintenance strategies. As a new pavement ages, a pavement can be protected with a
seal coat and restored with an overlay. To be effective, these strategies need to be
applied at proper times.
In conducting street evaluations, pavement conditions can be rated from a scale of 100 to
zero where 100 is brand new. The Pavement Management Program involves scheduling
the maintenance /reconstruction activities, as needed, to maintain the streets to an
acceptable level.
For instance, reconstruction streets are those that are beyond standard maintenance
strategies. Typically, these streets have deteriorated to a point where seal coats or
bituminous overlays are not effective or utilities in the street need replacing or the street
subgrade or street width needs correction. Streets in the reconstruction category can be
patched, for a time, but eventually the condition is such that the, maintenance costs are
quite high and the public is demanding the streets be upgraded. Currently, the City has
an estimated 11 miles of street in the reconstruction category.
Seal coats are an ongoing maintenance operation that has been conducted annually
utilizing the Burnsville Joint Powers Agreement for value pricing. The increased number
of new streets since 1996 is requiring more streets to be seal coated. A seal coat protects
the bituminous surface from weathering and extends the useful life of the pavement. As
the pavement weathers, the surface becomes more brittle and subject to cracking, which
allows water to access the street base accelerating the deterioration process. Studies and
experience dictate seal coats must be reported on an eight (8) schedule to be effective.
2
City of Shakopee Pavement Management Program
Once a pavement starts to show deterioration (cracking) and a seal coat is no longer
effective, an overlay is in order as the next level of maintenance. Overlays are usually
over a 20 year period of the pavement's life. An overlay restores the pavement section
and prolongs its life. If seal coat and overlay programs are properly conducted,
reconstruction of a pavement can be deferred for up to 50 years or more. Overlays
should be an ongoing annual program.
Proper application of these strategies to provide an extended pavement life cycle is
highlighted on the following graph:
MAINTENANCE STRATEGIES
FOR LIFE CYCLE EXTENSION
MNI+rtF�N,AN A7tS1£"+
sEALCOAT AND OVERLAY
- - - -- ROUTINE UM TENANCE ONLY
PAVEMENT AGE (YEARS)
While it may be difficult to achieve up to an 80 year's life cycle, as illustrated, a 40 to 60
Year cycle is reasonable to expect.
3
Street Reconstructions:
4
VARIES
3.0%
6" TOPSOIL, SEED,
AND MULCH OR SOD )
(TYPICAL)
PROGRAM COSTS:
SEALCOATING
OVERLAYS
City of Shakopee Pavement Management Program
Streets reconstructed by the City since 1980 are identified on a map located in the
Appendix. The cost of reconstructing streets to today's standard section, including
reconstruction behind the curb, is approximately $250 to $300 /per lineal foot depending
on soil conditions and various street widths.
2.0%
33' - 37' (BACK TO BACK
SHAKOPEE STANDARD
SURMOUNTABLE C & G
4
2.0%
VARIES
3.0%
1.5" MVWE45035B BITUMINOUS WEARING COURSE (2350)
BITUMINOUS TACK COAT (2357) .
2.5" MVNW35035B BITUMINOUS BASE COURSE (2350)
8" AGGREGATE BASE, CL 5 (2211), 100% CRUSHED LIMESTONE
SELECT GRANULAR BORROW (3149)
SCARIFY AND COMPACT SUBGRADE (2112)
Based on the previous discussion of maintenance strategies, a program cost for each can
be estimated as follows:
Based on the 98 miles in the seal coat category and using a repeating 8 year cycle up to
12 miles of City street should be seal coated each year. The cost per square yard for seal
coating in 2006 was $.65 /square yard. The annual cost for 2007 should be $160,000,
including some leveling, striping and engineering costs. As new streets are added to the
City's inventory and construction costs rise, the annual budget for seal coating operation
will increase accordingly. For 2006, a $60,000 amount was budgeted for seal coating and
this amount is not enough to keep up with the large number of new streets since 1996. It
should be pointed out that reconstruction streets and overlayed streets will fall into a seal
coating operation and thus will increase the City's inventory in the future.
As shown in the Life Cycle Graph, overlays are conducted with a 20 year life expectancy.
The current inventory of streets to be overlaid is 31 miles. To prevent a number of these
streets from falling into the street reconstruction category, it is estimated that the City
should spend approximately $780,000 per year on bituminous overlays. A major reason
for this increase in bituminous overlays is that no overlay projects were done from 1998
to 2003 and the 2004 and 2005 projects were relatively small overlay projects. Again,
costs would rise as the street mileage and construction costs both increase. For
Shakopee, a large number of street miles are fairly new. Since 1996, an average of 6.3
miles of new street per year has been added due to development. As these streets age, the
number of miles of overlays per year should increase. We will see a substantial yearly
increase of streets in the overlay category beginning around 2016.
RECONSTRUCTION
The City of Shakopee has about 11 miles of street in the reconstruction category
consisting of both urban and rural street segments. Many of these streets can be
maintained to function but seal coats /overlays are not a feasible option. Based on
reconstruction costs of $250 /lineal feet, a mile of street reconstruction is $1,320,000.
One mile of "Old Shakopee" streets is approximately 14 blocks of streets, 380 feet long.
It should be pointed out that a reconstruction street is about 5 times more expensive than
a bituminous overlay. A good pavement management strategy is to keep pavements from
getting into the reconstruction as long as possible.
CIP- FINANCING:
City of Shakopee Pavement Management Program
In preparing the 2007 -2011 Capital Improvement Program (CIP) for street
reconstructions and overlays, the following assumptions were used:
1. Reconstruct approximately 12 -14 blocks of street for the next five years.
2. Spend an average of $780,000 per year for next five years on bituminous
overlays.
3. Assess 25% of the cost for reconstructions and overlays.
4. Use an average of $255,000 per year of State Aid to fund the improvements.
Items for Council to consider in future financing of Pavement Management Program:
1. Fully fund seal coating up to $160,000 per year and out of the Street Division
of the Public Works budget.
2. Do not assess sanitary sewer services similar to SPUC not assessing water
service lines on reconstruction projects.
3. Increase street reconstructions and overlay assessments to 30% of the project
costs.
5
•
City of Shakopee Pavement Management Program
4. Each development is charged, at the time of final plat, for a future seal coat
based on current year pricing.
The following table summarizes the anticipated debt schedule assuming the Pavement
Management System is implemented as proposed for the purpose of budgeting
bituminous overlays and street reconstruction projects have been combined. Some years,
given street conditions and project areas, it may make sense to do more overlays and less
reconstructs and vice versa. Also, when budgeting for street improvements, it is
important to look at a 5 -years average. Because project areas, conditions and pricing
vary year to year, it is difficult to spend the exact same amount on street projects each
year. One year we may be below the budgeted amount and the next year we may be over
the budgeted amount. The City may want to set -up a street account and commit a set
amount of money per year to that account. This would help account for the yearly
fluxuations in pricing. The table below assumes a 3% inflation factor per year:
TAX LEVY
2007 2008 2009 2010 2011
Seal Coating $160,000 $165,000 $170,000 $175,000 $180,000
Reconstruction/ $1,190,000 $1,225,000 $1,262,000 $1,300,000 $1,339,000
Bituminous Overlays
The numbers in the table above were calculated assuming an assessment rate of 25% and
using an average of $255,000 per year of State Aid to fund the improvements.
Bruce Loney Jeff Weyandt
Public Works Director Assistant City Engineer
ENGR/ SPECS - DETAIL - PLATES /SHAKOPEEPAVEMENT MANAGEMENTPROGRAM
6
2 01 1 St Ove rlav
■ 2006 Pavement Management System Report
Outl expenditures for bitu overlays of
$780,000 per year
45% of Shakopee Streets built from 1995 to 2005
Average o 6.5 miles of streets per year
Pavement Report recommended at some point to
concentrate on overlays versu reconstructions
► Overlay "Bu bble "
1995 - 1999 33.76 miles o s treet constructed
2000 -2004 31. mi les of street constructed
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2011 S treet Overlay
■ Pavement Management Strategies
O Seal Coating - $.1 1
O Bituminous Overlays - $1.00
O Remove and Replace Pavement - $2.34
O Total Reconstruction of street $5.00
■ The above figures are ratios to one other with
overlays being the base cost of $1.00
\%
440:A
2 0 1 1
St reet
■ Overlay A - Downtown Area
0 $425,000 (Est.)
► Overlay B - Vier Drive and streets north of
Vierling Drive and part of Marsc Road
0 $455,000 (Est.)
Total $880,000
. 3
2011 St reet
■ Attachment A
0
4 Scenarios
1) No Assessment - 100% CIF
2) 30% Assessment - 70% Bond Tax Levy
3) 20 % Asses sment - 80% OF
4) 30% Assessment - 70% CIF
9
201 1 S treet Overlay
►Alternatives 13 & 4
0 CIF tax levy $1,000,000 for 2011- 2015
■ Alternat 2
0 Debt tax levy $2,1 51 , 000 for 2011-2015
S treet Ov
201 1
■ Attac B
0 201 1 CIF Cas Level
0 Balance 12 / 31 / 1 1
$4,80
�` �
201 1 S treet Over
► 201 1 Pro
■ Recomme is to do entire pro with
CIF funding.
0 Better bids with larger pro ject
Does not increase back log of streets to be overlaid
2 0 1
S treet Over
■
Show Attachments and Project Areas
Attachment A
Attachment B
0
5 1 : 1 % \ ,••
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