City of Morgan Hill Adopted Budget FY 2016-17 and FY 2017-18

CITY OF MORGAN HILL CAPITAL IMPROVEMENT PROGRAM

308 - Street CIP

Fund Description This fund was established effective July 1, 2007. The fund accounts for resources and requirements for capital projects that support the City of Morgan Hills streets and roads. The fund has been separated from Street Operations, fund 202.The funds allocated, which are normally transfers from other revenue funds such as the Traffic Impact Fund 309, and grant reimbursements, may be expended on new streets, traffic signals, and improvements of existing streets. How this Fund Generates Money for Capital Investment The funds allocated, which are normally transfers from other revenue funds such as the Traffic Impact Fund 309 and grant reimbursements, may be expended on new streets, traffic signals, and improvements of existing streets. Since 2012, the City's Pavement Condition Index (PCI) has dropped from 76 to 67 and is now considered "at risk." The General Fund contributes for street improvement projects increased from $750,000 to $1,000,000 annually in each of the next three fiscal years, bringing the total estimated investment in the City's pavement rehabilitation and safety program in the Biennial Budget to $4.0 million, including gas tax funds and a grant. However, unless new revenue sources can be obtained in future years, the CIP includes a total of only $1.8 million (or $0.6 million each year) for fiscal years 19-20 through 21-22. Limitations and Other Important Factors This fund does not independently generate any revenues. For the most part, the funds used for street-related work have been primarily grants. Since grants are paid on a reimbursement basis: 1) the work is first completed, 2) a reimbursement request is submitted, and 3) in approximately 60-90 days a reimbursement check is received. Because award of a grant constitutes a "reimbursement promise" by the granting agency, it is not unusual for the process to overlap fiscal years, the work might be completed in one fiscal year, and the reimbursement is received in the new fiscal year. Expenditures are only made on the assurance of funds to be received. Because Fund 308 has no income sources beyond grants, it occasionally receives loans from another fund so that the grant application process can be initiated (design work, renderings, studies, etc.). These loans are routinely repaid upon receipt of grant reimbursements for the project. Goals for Capital Investment The goals during this period are to continue with the pavement rehabilitation program and the assessment district streets.

Project List Summary Projects

2016-17

2017-18

2018-19

2019-20

2020-21

2021-22

519000 - Pavement Rehabilitation Program 563013 - Assessment District - Streets

$1,995,000

$1,345,000

$1,350,000

$605,000

$610,000

$610,000

$705,000

Totals $2,700,000

$1,345,000

$1,350,000

$605,000

$610,000

$610,000

2017-2022 Six-Year Capital Improvement Program

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