City Streets: Investing in a Neglected Asset

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CITY OF GARIBALDI The city received a $25,000 Small City Allotment grant to pave Cypress Street in front of Garibaldi Elementary School, but cannot apply for the ODOT city allotment grant for another two years. Garibaldi has afive-year maintenance plan including tentative paving priorities. The City Council and the public considered several funding options at a town hall meeting, including a gas tax and a street impact fee. Voters rejected a levy that would have charged 69 cents per $1,000 assessed value on the November 2006 General Election ballot. The 2006 street levy was not the city's first attempt at a street levy. h11992, voters approved a three-year, $50,000 levy for paving and improving city streets. During the next seven years, the city was able to pave or re-pave 40 blocks. The levy returned Garibaldi's street system to "good condition," but the city has since struggled to pay for street maintenance and preservation. The city must acquire funds for reconstruction and preservation costs because it now has 50 blocks of deteriorating asphalt. The city has utilized other funding options. The transportation SDC.helped Garibaldi improve new-growth areas but there has not been much growth. The city also implemented an urban renewal district to help generate funds long term for improvements in the commercial zone. These two funding mechanisms have helped the city with improvements in commercial and new residential neighborhoods. However, already developed areas outside of the urban renewal district do not benefit from these projects. There is little revenue available for maintenance and preservation of these residential areas, and there will not be any more revenue when these streets deteriorate to the point of reconstruction. In January, 2007, the City Council completed a franchise agreement with Tillamook PUD. The agreement increased the franchise fee rate to 5 percent, with the additional 3 percent going into the street fund for asphalting projects. This will net an additional $27,000 into the street fund each year. With diminishing resources, Garibaldi must find alternatives to maintain and improve its' streets so it can continue to be an economically thriving community. CITY OF GRESHAM Due to insuj~cient revenue, Gresham's deferred street maintenance costs have been increasing dramatically: $1.5 million in 1997; $23 million in 2006; and if current funding trends continue, $257 million by 2025. GRESHAM QUICK FACTS • 2006 Population: 97,745 (an increase of 23 percent in 10 years) • Funding Need: An additional $4 million annually is needed to maintain Gresham's 800 lane miles. A total cost more than $23 million is needed to bring all streets up to "good" condition. • Highway 26 runs through. Gresham, • Local Economy: Boeing (1,200 employees), Albertsons Distribution Center (565 employees). Technology- ON Seminconductor (550 employees), Microchip Technology (298 employees). Transportation funding in Gresham is diminishing, and will be in the "red" in 3 to 6 years depending on forecasts. The city would need $4,208,137 per year to prevent the street condition from worsening, or $11,529 per day. Currently, the city of Gresham spends $2,356 per day. Gresham Street Fund Revenue FY 05-06 Other Revenue M It h C F d' Due to a severely stressed general fund that must support core services, such as public safety, the city's street fund receives no supplemental revenue from the general fund. Beyond the revenue received by the State Highway Fund, the only other revenue sources for the street fund are a portion of the franchise fees (to fund street lights), transportation systems development charges (to fundgrowth-related capital improvements) and grants. The city receives a portion of Multnomah County's 3-cent gas tax, which partially pays for the maintenance of former county arterials. ~_1; u noma ounty un ing Despite these different revenue sources, Gresham's State Highway Fund Revenue deferred maintenance costs have been increasing: $1.5 million in 1997; $23 million in 2006; and if current funding trends continue $257 million by 2025. As a result of the declining revenues,. the condition of Gresham's streets is deteriorating. All of the city's capital maintenance has been spent onpreservation, not reconstruction. The city's cost-effective philosophy is to spend limited City Streets: Case Studies -Page 26 City Streets: Case Studies -Page 27