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88-1918 WNI�E - CITV CLERK /_� /�'. ��/� PINK -'K{JANCE COI1jIC11 y j� CANARV - DEPARTMENT G I TY OF SA I NT PAU L BI.UE - MAVOR File NO.J� v — Council Resolution � Presented By ��j�+'�'�� Referred To Committee: Date Out of Committee By Date WHEREAS, the Council of the City of Saint Paul is responsible for providing policy guidance in the annual preparation of the Capital Improvement Budget; and WHEREAS, the Planning Commission has reviewed the policies adopted in the Saint Paul Capital Allocation Policy: 1988-1989, and has revised them as indicated in the attached copy of the Saint Paul Capital Allocation Policy: 1990-1994; and WHEREAS, the Planning Commission released the Saint Paul Capital Allocation Policy: 1990-1994 for public review and held a public hearing on the document on November 4, 1988; and WHEREAS, the Planning Commission approves and recommends adoption of the policies entitled Saint Paul Ca ital Allocation Polic : 1990-1994 for use in the Unified Capita Improvements Program an Budget Process; and WHEREAS, all of the Saint Paul Ca ital Allocation Polic : 1990-1994 except for the Financial Policies Section 3.3 wil be used by City departments and neighborhood organizations to prepare proposals for Capital Improvement Budget financing, and by the Saint Paul Long Range Capital Improvement Budget Committee to devise a Project Rating Sheet for evaluating proposals for Capital Improvement Budget financing; and WHEREAS, the 1989-1990 calendar for the Unified Capital Improvement Program and Budget Process (UCIPBP) directs that the Saint Paul Long Range Capital Improvement Budget Committee adopt its 1990/1991 Project Rating Sheet on February 9, 1989; and WHEREAS, the 1989-1990 calendar for the Unified Capital Improvement Program and Budget Process (UCIPBP) directs that the Saint Paul Long Range Capital Improvement Budget Committee prepare its recommendations for the 1990-1991 Capital Improvement Budget on June 27, 1989; and COUNCIL MEMBERS Requested by Department of: Yeas Nays Dimond Long [n Favor Goswitz Rettman B s�he;n�� __ A gai n s t Y sonnen Wilson Form Approv by City rney Adopted by Council: Date Certified Passed by Counc.il Secretary BY � ` � 1 gy Approved by Mavor: Date Approv Mayor for Subm' ' n to Council By WHI7,� - C�TV CIERK � /Y PINK - :�IANCE - COUIICII (y/ CANARV - DEPARTMENT GITY OF SAINT PAUL File NO. �V ��j� BLUE - MAVOR � Council Resolution Presented By Referred To Committee: Date Out of Committee By Date � WHEREAS, the Financial Policies (Section 3.3) of the Saint Paul Ca�ital Allocation Polic : 1990-1994 will be used by the Saint Pau Long Range Capita Improvement Budget Committee to prepare its recorr��nendations for the 1990-1991 Capital Improvement Budget; NOW, THEREFORE, BE IT RESOLVED, that the Council of the City of Saint Paul hereby adopts all of the attached Saint Paul Ca ital Allocation Polic : 1990-1994 except for the Financial Policies Section 3.3 for use in the Unified Capital Improvements Program and Budget Process; and BE IT FURTHER RESOLVED, that the City Council directs transmittal to the Neighborhood Contact List, the Long Range Capital Improvement Budget Committee and its task forces, the Saint Paul Planning Commission and appropriate City staff persons; and BE IT FURTHER RESOLVED, that the City Council study the Financial Policies (Section 3.3) of the Saint Paul Capital Allocation Policy: 1990-1994 and adopt them by May 26, 1989. COUNCIL MEMBERS Requested by Department of: Yeas Nays Dimond Lo�g [n Favor Goswitz Rettman s�ne�ne� __ Against BY Sonnen Wilson �CB - � 1989 Form App ed by City t orne Adopted by Council: Date Certified Yass d � ouncil tar�. By ` By l�pproved � vor ate �V"� Appr e y Mayor for Subm' si n to Council BY — Pt�Btf��D .__�_ � �� 989 , + _. _ __ _ __—�---- -- -- ✓ .�; , _ GITY OF SAINT PAUL (,�'- ��` `� . iiiiisfi;�' ' `' OFFICE OF 'P R F CITY COUNCIL - Committee Report Finance. Manaaement. & Personnel Committee January 23, 1989 ! . Approval of minutes of January 9 meeting. Approved 2. Resa��•i ort�;�-l 918 - .adc�t f rts the St. P�rr� Cap i ta i A l l o- Apprcrvveci subs titute cat i on��f c� �pr, the yr�►rs,.i 99p thr�c�h 1994. (Referred from Counc i l becember 8, i�id over Ja�i�rary 9f' 3. Resolution 89-XXXX (�o be assigned) - providinq funds for Approved substitute levee and fioodwatl improvements. 4. Resolution 88-1964 - amending the 1988 Capital Improvement Approved substitute Budget by transferring $373,000 from Finance and Management Services to Capital Project Building Improvements. (Referred from Council De�ember 13) 5. Resolution 88-1965 - amending the 1988 budget by adding Approved substitute $373,000 to the Financing and Spending Plans for City Property Management Fund City Hal1 Annex. (Referred from Council Decernber 13) 6. Discussion of Personal Service Contracts, applicable IRS Information only regulations, and need for modification of existing prac- tices. 7. Resolution 89-XXXX (to be assigned) - amending the Approved 2-1 1989 budget by transferring $29,800 from Contingent Reserve to Executive Administration/Personnel Office/ Recruitment. 8. Resolution 88-1945-A - establishing the rate of pay Approved substitute for E.D.P. Aide in Grade 24, Section ID2 of the Technical Standard Ranges in the Salary Plan and � Rates of Compensation Resolution. (Referred from Council December 13, laid over January 9? 9. Resolution 88-1946 - changing the rate of pay for Approved Environmental Health Director in Section ID4 of the Professional Supervisory Standard Ranges in the Salary Ptan and Rates of Compensation Resoiution. (Referred from Council December 13, laid over January 9) CITY HALL SEVENTH FLOOR SAINT PAUI., MINNESOTA 55102 s�,ae ��-�r�' � � � �l° 013796 P.E.D. DEPARTMENT - Mark Vander Schaaf CONTACT NAl� 3373 PHONE � Novemher 22. 1988 DATE . ASSIGN NITMBER FOR ROtTTING QRDER: (See reverse side.) �, Department Director��%� 4 Mapo� (or Assistant) _ Finance and l�anagement Services Director 5 City Clerk Budget Director 1 Pe Re�chert � City Attorney _ TOTAL NUMBER OF SIGNATURE PAGES: 2 (Clip all locations, for signature.) WHAT WILL BE ACHIEVED B� TAKING ACTION ON THE �4TTACHED MATERIALS� (Purpose/Rationale) Dhe Planning Commission has adopted a revised version of the Cap3.tal Allocstion Policy (CAP). The document musC be transmitted to the City Council for adoption by December 30 in order to be used for the next.capital budgeting process. �The ma�or issues tha.t arose with the revision of this document are discussed in an attached ,copy of an iasues memo from the Economic Development Committee of the Planning.Commission. A draft traasmittal letter from the Mayor to City Council and draft City Council resolution are also attached. COST�BBNEFIT. BUDGETARY. AND PERSONNEL IMPACTS ANTICIPATED: FINANCING SOURCE AND BIIDGET ACTIVITY NUMBER CHARGED OR CREDITED: (Mayor's signature not required if under $10,000.) R F��/�F� Total Amount of TransBCtion: Aetivity Number: N �(/ ��n ,�e Funding Source: �j,�yO�s O 8 • F�Cj�,�, ATTACHMENTS: (List and number a�ll attachments.) . 1. Traasmittal. letter from .Mayor to City Council (for Msyor's signature) 2. Memo from Economic :Development Committee of the Planning Commission (10 copies) 3. Planning Commission resolution (adopted November 18, 1988)- 0 o ies 4. Draft City Counc�.l resolution � ��'� �,��n 5. Draft of the Capital Allocation Policy (10 copies) � �'"'" °�'�-O ADMINISTRATIVE PROCEDURES Yes _No Rules, Regulations, Procedures, or Budget Amen'diae'ht��qtr�ed? � _Yes _No If yes, are they or timetable attached? ' DEPARTMENT REVIEW CI�Y ATTORNEY REVIEi�I � X Yes _No Conncil resolution required? Resolution required? x Yes _No _Yes ,_No Insuranc.e required? Insurance sufficient? �Yes � _No Yes No Insurance attached? . . ��-i9/� .�tT'o. CITY OF SAINT PAUL �� ; e : OFFICE OF THE MAYOR � i=ii�eiln +' a ao ^a iss• 347 CITY HALL SAINT PAUL, MINNESOTA 55102 GEORGE LATIMER (612) 298-4323 MAYOR November 22, 1988 President James Scheibel and City Council Members Seventh Floor City Hall Saint Paul, MN 55102 Dear President Scheibel and Members of the City Council: I am pleased to transmit to you the 1990-1994 Capital Allocation Policy (CAP) . The CAP is a set of policy statements used to guide budget decision-making for the upcoming biennial capital budgeting process. I urge you to review this document, and adopt it as city policy. In order to have this document available for the 1990-1991 capital budgeting cycle, you must adopt it by December 30, 1988. Over the past ten years, the CAP and its companion document, the Program for Capital Improvements (PCI) , have incorporated a solid citywide perspective into the capital budgeting process. The Planning Commission revises each document as part of the two-year capital budgeting process, and strives to improve them with each revision. Some significant changes have been made in the capital budgeting process since 1986. Two years ago, the Planning Commission committed itself to revising the PCI and the CAP in a more strategic fashion. Consequently, a Joint CIB Committee/Planning Commission task force was created to consider ways to strengthen the role of the Planning Commission in the capital budgeting process. The recommendations of this task force were adopted by both the Planning Commission and the CIB Committee, and are now being implemented. Important revisions in the process include the following: TiminQ. In the future, the PCI will be created after a two-year capital budget is adopted. The PCI is a plan for future capital investment. In the past, the PCI was adopted along with the CAP, prior to the adoption of a budget. Because the adopted budget often differed from the PCI, the PCI quickly became outdated. By creating the PCI after the budget is adopted, the budget can be incorporated as the first two years of the PCI, enabling the PCI to become a more reliable and useful long-range plan. Time Horizon. In the future, the CAP will have a five-year time horizon, in contrast to its two-year time horizon in the past. The time horizon of the PCI will be expanded to ten years in contrast to the five-year time horizon of the past. The intent of this change is to distinguish between probable projects (programmed during the first five years of the PCI) and long-range departmental and neighborhood needs (programmed during the second five years of the PCI) . �48 . . �-�9�� President James Scheibel and City Council Members November 22, 1988 Page 2 Strategic Focus. The attached CAP includes an updated set of strategic goals, derived from the Saint Paul Tomorrow pro�ect and from a city mission statement which the City Council has adopted. When the PCI is adopted in 1989, it will include "capital function strategies" which are based on these goals. Future CAPs will include both updated strategic goals and updated capital function strategies, thus strengthening the foundation of the city's policies for capital allocation. Several issues, were raised during the review period for the draft CAP, leading to further revisions of the CAP. The attached memorandum from the Economic Development Committee of the Planning Commission discusses the issues and recommends a way to address them. The Planning Commission accepted all of the committee recommendations. Thus, the version of the CAP which I am transmitting to you has been revised in accordance with these recommendations. The Planning Commission believes that much progress has been made in improving the CAP. Discussions with city departments have indicated that they are also pleased with the work that has been done to strengthen this document. I trust that the CAP will be a valuable tool as we work together to determine the focus of the 1990-1991 capital budget. Very truly yours, r eo e atimer Ma r GL/bp Attachments . .. C`TT O. , �� /�l/ �•` �, CITY �OF SAINT PAUL ; �� ; DEPARTMENT OF PLANNIN AND ECONOMIC DEVELOPMENT � __ �� a n 1 DIVISION OF PLANNING ♦ � „1 25 West Fourth Street,Saint Paul,Minnesota 55102 ,.s• 612-22&3270 GEORGE LATIMER MAYOR MEMORANDIIM T0: Mayor George Latimer Members of the City Council FROM: Mark Vander Schaaf �.� City Planner � DATE: January 25, 1989 . SIIBJECT: Capital Alloc$tion Policy, 1990-1994 On January 23, 1989, the Finance, Management and Personnel Committee of the , City Council took the following actions regarding the draft i990-1994 Capital , Allocation Policy which the Planning Commission adopted on November 18, 1988 (new wording underlined) : � 1. Revision of G2: Neighborhood Management (page 10) G2: Neighborhood Management and Housine o Goal: To support the careful management of Saint Paul neighborhoods, each according to its own best potential. o Discussion: This Strategic Goal has several implications. First, it identifies neighborhoods as the focus of community life in Saint Paul. Second, it highlights the importance of the citv as a residential environment. Good neighborhood management should lead to the provision of attractive housin�o,pportunities for a broad spectrum of the city's po�ulation. Seeead�y ird, it suggests that all areas of $aint Paul--outlying areas and downtown--belong to neighborhoods. �k}�� Fourth, it indicates that conscious neighborhood management is necessary. Such management should involve both neighborhood self-management and management by city officials. Finally, it stresses the notion of "potential," suggesting that different neighborhoods have . different potentials. Policies and projects which are appropriate in one neighborhood may not be in another neighborhood. 2. Revision of P2: New Facilities (page 12) P2: New Facilities Proposals for certain types of new facilities will not be considered for financing in 1990-1991. These facilities are: . . ��4�� Mayor Latimer; City Council January 25, 1989 Page 1�ro c. New library or recreational service facilities which will increase operating and maintenance expenses. Expanded1 e� rehabilitated or replacement of existing inadequate library or recreational facilities which will require an increase in staff aay will be considered if the improvement is consistent with a plan approved by the City Council which identifies the need for the improvement. 3. Revision of P4: Handicapped Accessihility (page 13) � P4: Handicapped Accessibility All new facilities aust be handicapped accessible. All proposals for the rehabilitation or remodeling of facilities must consider the option of making the facility handicapped accessible,i ead must estimate the cost of pursuing this option and: if handicapped accessibilitv is not provided must include a written justification for not nroviding �andicapped accessibility. ' 4. Change in Consideration of tbe Needs of the Economicallq Disadvantaged The following policy was reaoved from the document: [Old E4] : Economically Disadvantaged• In evaluating proposals for capital pro�ects, preference shall be granted to pro,jects which demonstrably focus on meeting the needs of the economically disadvaiataged. Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this ob�ective shall neither be penalized nor given preference. Instead, the following language was inserted into E22 jold E23J , page 22: The extent to which a project will be used will be taken into consideration. Also. efforts shall be made to ensure that proj,ects meet the needs of the economically disadvantaged. This means that: a. The greater number of people served by a project, the greater the . consideration that should be given to a project. Administrative units shall be considered separately from neighborhood facilities. � b. Pro�ects used year-round will be given greater consideration than projects used primsrily on a seasonal basis. � � Mayor Latimer; City Council January 25, 1989 Page Three 5. Revision of E18 [Old E19� : Acquisition (page 21) E18: Acquisition �a-e�de�-�e-�a�s�a�a-i�s-ex�sE�ag-�ax-base;-�ke-e3�y-ska��-d�seex�age ��e-xse-e€-aeqx#s��ea-as-a-�edeve�eg�eR�-�ee�---HeWeve�;-a A project that involves acquisition may be given the same priority as a project which does not if: 6. 8evision of E19 [Old E20] : Joint IIsa (page 21) E19: Joint Use A facility that will.be financed and operated by the city and another agency. or other operating departments or divisions within the city. will be given special consideration if: c. Operation and naintenance expenses for the facility will be shared " �ointly-by the city and the otiher �agency�_or other operating departments or divisions within the citv; - 7. Deferral of Adoption of Financial Policies (Section 3.3; pages 23-26) The resolution recommended by the Finance Committee adopts all of the Capital Allocation Policy except for the Financial Policies (Section 3.3) . The Finance Committee desires more time to study these policies thoroughly. Because the Financial Policies will be used by the CIB Committee when it recommends projects and financing sources (in late June) , the proposed resolution also stipulates that the City Council should adopt the Financial Policies by I�Iay 26. ��-�9��' �•``'TT o• �i CITY Of SAINT PAUL ° '' DEPARTMENT OF PLANNING AND ECONOMIC DEVELOPMENT +� '�� ° DIVISION OF PLANNING �� 25 West fourth Street,Saiet Paul,Minnesota 55702 612-228-3270 GEORGE UTIMER MAYOR T0: Planning Commission FROM: Economic Development Committee DATE: November 9, 1988 SUBJECT: Issues Raised During the Review of the Draft Capital Allocation Policy (CAP) Introduction On September 23, the Planning Commission released a draft of Saint Paul's 1990-1994 Capital Allocation Policy for public review and comment. This memorandum outlines issues raised during the review period of September 23 through November 4. The issues are discussed in order of their appearance in the draft CAP. The draft CAP has been revised in accordance with the recommendations of this memorandum, and should be adopted by the Planning Commission on November 18 and transmitted to the Mayor and City Council for review and adoption. A resolution is attached for Planning Commission consideration. Issues 1. Goals and Policies Issue: Some are concerned that the Strategic Goals are not sufficiently precise to serve as policies. Discussion: To address this concern, it would be helpful to clarify two points: a. Goals are different from policies. Chapter 2.0 (Strategic Goals) in the CAP is intentionally set apart from Chapter 3.0 (Policies for Capital Allocation) to make this distinction. Nevertheless, clarifying language in the text could further emphasize the distinction. b. Goals will become more precise when Capital Function Strategies are revised to reflect the new Strategic Goals. In future CAPs, Capital Function Strategies should be incorporated into the chapter which, in this CAP, is limited to Strategic Goals. Together, these statements would function as a solid foundation for the City's policies for capital allocation. . . i9��' Pa e T�o �� g November 9, 1988 Reco�endation: Add the following clarifying language: p. 8, Section 2.1, second paragraph: "During the upcoming capital budget cycle, the evaluation of individual proposals will be based on policies which stem from the Strategic Goals of the CAP." (new language underlined) p. 8, Section 2.1, new third paragraph: " The Strategic Goals (Cha�ter 2.0) and the Policies for Capital Allocation (Chapter 3._0� are stated in separate chapters. The intent of this structure is to em�hasize that Strategic Goals are not �olic� Instead. they are �uidelines for the develoument of policy. The policies articulated in Chapter 3.0 are the authoritative interuretation of the meaning of the Strategic Goals. In future vears even greater precision will be provided as Capital Function Strategies are incorporated fully into the CAP. The Capital �'unction Strategies will serve to clarify the intent of the Strategic Goals and to strengthen the foundation of the Policies for Capital Allocation." 2. Liability Exposure Issue: Because damage payments to in�ured persons can be a significant city expense, the city should analyze and limit liability exposure connected with capital pro�ects. It has been suggested that language be added in G4 (p, 10) and E15 (p. 19) to emphasize the importance of limiting liability exposure. Discussion: This is a valid concern, but one that may best be addressed elsewhere in the CAP. Liability exposure is created by conditions that threaten life, health or safety. The definition of service levels in E1 (p. 16) may therefore be the best place to address the concern. By discussing the issue in this context, the CAP will stress that decreased liability exposure is important but is not an end in itself. Rather, it accompanies the city's ob�ectives of preserving human life, health and safety. Recommendation: Add the following language to E1 (p. 16) : a. "This categorv includes projects that prevent or correct hazardous situations and/or critical breakdowns, and limit the city's exposure to liabilitv a�e-�ae�nde�." (new wording underlined) b. "By addressing these needs on a systematic basis, the city can ensure the structural integrity of its capital facilities, axd prevent potential health and safety hazards, and limit the city's potential exposure to liabilitv." (new wording underlined) s , ____ _ _ . _ _ _ __ _ __ _ _ _ _______ _ n� �� U �� Page Three November 9, 1988 3. New Facilities Issue: Policy P2 on p. 12 lists four types of facilities which will not be considered for financing. It has been pointed out that these types of facilities only include ones which would be administered by the Department of Community Services. Thus, the policy seems to assume (perhaps unintentionally and perhaps inaccurately) that only this department is likely to be connected with proposed projects exceeding the basic level of service. Discussion: Policy P2 indeed excludes consideration of some proposals. The reasons for the exclusion include limitations on city resources as well as adopted policy which defines the breadth of appropriate city services. Policy P2 is analogous to P8 which places a similar limit on one type of pro�ect under the ,jurisdiction of the Department of Public Works. Reco�endation: Both P2 and P8 are the result of city policy which was developed to define appropriate service levels as well as limit expenditures. Therefore, staff does not recommend abandoning them. However, the point is well taken that there may be types of pro�ects connected with other capital functions that should similarly be excluded from consideration. This issue should be explored when capital function strategies are revised so that limits in the future are applied evenhandedly to all types of potential proposals. � 4. Skyways Issue: Some of the language in policy P3 seems too strong. This policy should not state that the City "will" finance particular projects since proposals for such pro3ects must be evaluated and prioritized alongside other proposals. Reco�endation: Change "will" to "may" in parts 2 and 3 of policy P3. Abandon underlining. 5. Handicapped Accessibility Issue: Concern has been expressed with policy P4 which states: "All new facilities must be handicapped accessible. All proposals for the rehabilitation or remodeling of facilities must consider the option of making the facility handicapped accessible and must estimate the cost of pursuing this option." The concern is that this policy could pressure the City into unnecessary improvements or otherwise harm reasonable proposals. Discussion: The proposed policy is a balanced approach to an important policy issue. Rather than pressuring the city into unnecessary improvements, the proposed policy will enable the city to reach better decisions concerning whether the costs of handicapped accessibility outweigh the benefits in particular projects. Reco�endation: No revision of proposed policy. , 9��/ �� Page Four November 9, 1988 6. Extraordinary Capital Maintenance Issue: Several questions/issues have been raised concerning this proposed policy (P6) : a. Does the $350,000 figure apply to the entire biennium or to each year of the biennium? Some city staff strongly contend that $350,000 is inadequate as a biennial figure although it may be adequate as an annual figure. b. It may not be reasonable to assume the elimination of the need for extraordinary capital maintenance in the foreseeable future. Concern has been expressed over the following sentence: "It is expected that regular preventive maintenance will eliminate the need for extraordinary capital maintenance over time." The concern is that regular preventive maintenance programs are not adequately financed and that operating funds for maintenance are frequently transferred to other programs. Thus, according to this argument, it is misleading to "expect" that extraordinary capital maintenance programs can prudently be eliminated in the foreseeable future. Moreover, some argue that even an adequately financed regular maintenance program would not eliminate the need for extraordinary capital maintenance (as it is defined in the CAP) . c. It may be appropriate for the poliey to allow the financing of projects which may be cost effective relative to the life of bonds used to finance them, even if the life of the pro�ects is less than the life of the bonds. For example, a $5000 replacement of a skylight may extend the life of a roof another 6 or 7 years, which might otherwise need replacing in 2 or 3 years. d. Minimum cost of projects identified as $50,000. This figure is seen by some as too high. The result would be that some relatively large projects could put considerable strain on a department's already-strained regular preventive maintenance program. The intent of establishing a threshold is primarily to eliminate the need to submit numerous small projects to the CIB process. One department has suggested $5000 as a preferable threshold to accomplish this purpose while still permitting projects which otherwise fit the definition of extraordinary capital maintenance. e. No maximum project cost is identified. It is argued that an extremely large pro�ect should not be financed by this program for two reasons. First, it could exhaust funds which were intended for more modest pro3ects. Secondly, as a matter of policy, large projects should be approved only via the regular CIB process. f. The CAP does not specify what process is to be used to develop administrative guidelines for the extraordinary capital maintenance program. � /� �� i9 Page Five November 9� 1988 Recommendation: a. Modify language in P6, first paragraph, as follows: " . . .the city will consider budgeting up to $350,000 per vear in 1990 and 1991 for extraordinary capital maintenance. . ." (new wording underlined) . Budget Office staff has confirmed that this clarification fits the intent of the original proposal. b. Modify language in P6, first paragraph, as follows. [Delete final sentence and add] : "Adeauately financed programs for regular ureventive maintenance would. in time. reduce the need for an extraordinary capital maintenance pro�ram It is hoved that vreventive maintenance--both ordinary and extraordinary--will become a hieh city vriority. In the lon� run, deferred maintenance is not a cost-effective way of mana�in� scarce �inancial resources." (new wording underlined) c. Modify langua.ge in P6, third full paragraph, as follows. "Any work financed through the extraordinary capital maintenance program must have a life expectancy that exceeds the terms of the bonds used to finance it, or must be financed with non-bonded fund sources. Ongoing maintenance; an routine preventive care and upkeep of facilities;-ead-��p�evemea�s-w��k-a-��.€e-exgee�e�ey-�ess �kaa-�lqe-�e�s-e€-�ke-be�ds shall be financed through the city's operating budget." (new wording underlined) d. S� e. Add the following language to the end of P6, fourth full paragraph: "Except in cases of emergency, work projects financed through the extraordinary capital maintenance program must have costs which exceed S5.000 and are less than 575.000. Smaller work pro3ects shall normally be financed through the city's operating budget. Lareer work urojects shall normallv be financed through the rep�ular CIB process." (new wording underlined) f. Add a final paragraph to P6: "Guidelines sha11 be developed for administering the extraordinary capital maintenance program The �uidelines shall be reviewed bv the CIB Committee and approved b,y the City Council." (new wording underlined) 7. Residential Street Paving Issue: Some have argued that there may be desirable residential street paving projects that would be excluded by policy P8 on p. 15 which states that "residential street paving projects will only be financed in conjunction with sewer separation projects, except in situations where a pro�ect is required to prevent hazardous conditions that threaten life, health or safety." It is pointed out that the City Council sometimes wants all streets paved within a specific drainage area, but that policy P8 does not permit this. It is proposed as an alternative policy to allow additional residential street paving during years when little street paving is done in con�unction with sewer separation. Page Six November 9, 1988 Discussion: Policy P8 intentionally uses the phrase "in conjunction with street paving" to allow consideration of paving projects on streets that are reasonably close to an area where sewer separation occurs. Thus, the policy already addresses this concern. It is noteworthy that the expected cost of the paving permitted by this policy exceeds available resources. Therefore, a less restrictive policy would not be advisable as long as the method of financing residential street paving projects remains unchanged. Reco�endation: No revision of proposed policy. 8. Financing for Preliminary Studies Issue: This newly-proposed policy (P10 on p. 15) might not permit capital improvement budget financing of some studies which would be necessary for important pro3ects to occur. For example, it might not apply to engineering studies of alternative improvements of Ayd Mill Road as long as the city had not specifically committed to going ahead with this project. In the absence of capital budget financing, sufficient money may not be available to pay for studies of alternatives. Discussion: The logic of the policy in its current form is that the purpose of the capital budget is to finance specific physical pro,jects. According to this logic, it is inappropriate to use the capital budget to finance activities which precede the decision of whether or not to invest in a particular project. Indeed, such activities could not even be evaluated according to conventional criteria because, in the absence of a proposed pro�ect, it is difficult to evaluate the various costs and benefits associated with the project. Nevertheless, there is strong logic in the counterargument as well. A case can be made that engineering studies of alternative road alignments would only occur when the city has virtually committed itself to a road project. According to the counterargument, it is prudent for the city to include in its study the alternative of doing nothing to improve the road corridor as well as the alternative of using the land in the corridor in some other way. The necessary studies for the project should not be excluded from consideration for capital budget financing just because the city chooses to defer its final decision on a project until after the studies have been completed. Reco�endation: The CAP should make it clear that some kind of city financing is needed for studies such as the needed engineering analyses of Ayd Mill Road alternatives. It could do so in one of two ways: a. Stipulate that such studies should not be financed with the capital budget because of standard economic and accounting definitions of what constitutes a genuine capital investment. At the same time, the CAP could stress that sufficient noney should be made available in the operating budget for such expenditures. .. 9�� Page Seven November 9, 1988 b. Interpret the need for such a study as an indication that the city has virtually committed to some kind of project. Thus, the project study could be included in the Tentative Program of Commitments and could become eligible for capital budget financing. At the same time, stringent requirements could be implemented to ensure that only studies for actual or "virtual" commitments are placed within the Tentative Program of Commitments. These could include a requirement that both the Planning Commission and the CIB Committee approve the inclusion of any "virtual commitment" in the Tentative Program of Commitments. Also, Planning Commission and CIB Committee approval could be preceded by a preliminary study of the project, performed by the Planning Commission. Planning Commission approval could be based on a determination that the preliminary study indicates the need for a more detailed study of alternatives. Finally, the CAP could require that only non-bonding financing sources be used for the study. Alternative b. is the preferable approach. The language in P10, page 15, should be revised as follows: "Needs assessments e�-s��d�es es�ab��sked-�e-de�e�aiae-gess�b�e-e�-g�e€e��ed-xses-€e�-sgee�.€�e-s��es e�-eag��a�-€ae��#��es are ,�t appropriate capital improvement budget expenditures. �t�dies which examine alternative uses for specific sites o� capital facilities are not appropriate capital imurovement budget exuenditures unless thev are necessarv components of a major citvwide proj ect to which the city has made a virtual commitment Such a project shall be included in the Tentative Program of Commitments onlv upon the recommendation of both the Planning Commission and the CIB Committee 1'he Planning Commission's recommendation shall be based on a preliminarv study performed by the Planning Commission which indicates the need for a more detailed study of alternatives Long-term debt should not be used to finance studies for such projects." (new wording underlined) To prevent confusion between the study which may be financed by the capital budget and the preliminary study which must precede it, the name of P10 should be changed: "Financing for P�e��aiaa�y Studies." 9. Assessment Policy Issue: An earlier draft of the CAP included a project policy stating that a summary of the city's assessment policy is included as an appendix to the CAP. The draft released for public review dropped this policy because the summary had not been prepared. The summary is now available. Recommendation: Add the relevant project policy and the appendix �elating to the city's assessment policy. 10. Economically Disadvantaged, et al. Issue: Several related concerns have been articulated relative to E4 (p. 17) in particular, and to other policies which speak of preference and penalties (E5, E9-E16). Some argue that it is valid to grant preference . ,�.r� �� Page Eight November 9, 1988 but that penalties should not be assessed. Others concede that it is permissible to assess penalties but that it is inappropriate to state that this will occur as a matter of policy. Finally, concern has been expressed that this and similar policies might result in the penalizing of neutral projects, simply because they do not actively promote a stated preference. Discussion: The rationale for "penalty language" is twofold. First, evaluation penalties should indeed be assessed in cases where a pXoposed project, despite its other merits, actively undercuts some important policy ob�ective. Secondly, because the CIB Committee has in fact assessed such penalties in the past, it is appropriate to state in the CAP the conditions under which such penalties should be assessed, The intent of this and similar policies is not to penalize projects which have an indeterminate or neutral impact relative to the stated objective. Language could be developed to clarify this intent. Reco�endation: Add the following language to policies E4, E5, E9-E16: "��ojects which have a neutral or indeterminate imnact relative to this objective shall neither be penalized nor �iven vreference." 11. Impact on Operating Budget� City Revenues Issue: Policies E15 and E16 (pp. 19, 20) give preference/penalties based on the proposed pro�ect's impact on city operating and maintenance expenses, and the city's revenues. This policy has been criticized on several grounds. First, it is often difficult or impossible to determine what the impact on city costs and revenues will be. Moreover, clever proposers can succeed in hiding operating costs if they wish to avoid being penalized. Secondly, these policies may not be focusing on the correct policy objectives. Assuming that cost/benefit analysis is important, the concern should be to ensure that benefits outweigh costs, not to penalize projects automatically because they raise some costs or reduce some revenues. Discussion: The best way to address the above concerns is not obvious. Because cost/benefit analysis is at the heart of capital budget decision making, E15 and E16 should not simply be abandoned. Yet there appears to be room for refining these policies. The Joint CIB Committee/Planning Commission Task Force has identified the need to study the relationship between the capital and operating budgets. Such a study would provide important insights which could improve policies E15 and E16. Also, note that policy E25 (p. 22) requires that a fiscal impact analysis be submitted along with proposals involving a new service or an expanded level of service. This policy should also lead to information which could improve policies E15 and E16. Reco�endation: No revision of policy, pending a study of the relationship between the capital and operating budgets. This study should be a high priority in coming years. _ _ _ _ _ _ __ _ _ __ _ _ : ' � . 1�--�9�� Page Nine November 9, 1988 12. City Plans That Are Not Part of the Comprehensive Plan Issue: Action A4 (p. 28) recommends studying whether or not to address all capital functions in an element of the city's Comprehensive Plan. However, neither here nor elsewhere in the CAP is it acknowledged that some city plans for capital functions have been adopted by the City Council without Planning Commission supervision, review or approval. The status of such plans needs to be considered. Recommendation: Modify the language of the final paragraph of A4 (p. 29) as follows: "The process should begin with a Planning Commission study and evaluation of the way in which existing plan elements deal with capital functions and the way in which departments assess capital function needs. �le studv should also consider the status of city plans for capital functions which have been ado t�by the Citv Council without Planning Commission suvervision review or approval Finally the study should lead to a recommendation concernine what should be the Plannin� Commission's role in capital function ;7An mAkt„� and needs assess�ent. �'k�s-s�xdy-sket��d-�ead-�e-e-reeasaenda�fas-�e�ke�-e�-ae� �e-ger€e�a-�ke-aeeessa�j*-g�ass-aadfe�-�e-ea�ab�fsh-�l�e-�eee�eaded-see�s assess�ea�-p�eeedn�es-€e�-�e�evar��-eagf�a�-€t�ef�eas:" (new wording underlined) 13. Decision Frameaork for Social Service Needs � Issue: Concern has been expressed that demographic trends are forcing the city to play an increasingly important role in the provision of social services. The capital budget finances some facilities which provide these services (notably multi-service centers) . Yet the CAP does little to create a useful decision framework for the city to address these issues. Discussion: This is an issue that is both important and complex. At the heart of the issue's complexity are �urisdictional questions. Because many social service needs are properly addressed by other governmental units, the city should not accept more than its rightful share of responsibility for meeting those needs. At the same time, the city should be proactive in dealing effectively with social service needs that are within its jurisdiction. Reco�endation: Add a new "long-term action" on p. 30 as follows: A8. Capital Investment for Social Services Action: The Planning Commission should study ways to improve the CAP's ability to function as a decision fra�v�ork for meeting social service needs in Saint Paul. Hopever, this study should not be done in isolation from a study of the larger issue of the rightful responsibility of the city for the social needs of its citizens relative to the responsibility of other governmental units. . � . . . . - .-_ -. �- -- � ��7/� � DO Page Ten November 9� 1988 Discussion: Some city administrators have commented that the current CAP does not adequately function as a decision framework for the city to address social service needs. Because some capital investment is related to social services needs, it would be appropriate to improve the CAP in this respect. However, because the issues relating to social service provision extend far beyond questions of capital allocation, any substantive revision of the CAP should be part of a broader policy making effort. 14. Rolling Stock Issue: Currently, rolling stock are not eligible for financing by the capital budget. However, some rolling stock items are closely related to fixed stock and should perhaps be eligible for capital budget financing. Specifically, the city's bool�obile is underfunded by the operating budget and is nearly worn out. Consequently, it does not always work and isn't regularly available to provide important services to immobile populations. Discussion: The city's Administrative Code does not currently permit capital budget financing of rolling stock. However, because a good economic argument can be made that rolling stock is genuine capital, it might be appropriate to re-examine the rationale for the Administrative Code's position. This could occur when the Planning Couumission and CIB Committee study the current system of categorizing capital functions. Recommendation: Revise the language in Al, page 27, as follows: "For example, some city officials argue that a single 'city buildings' capital function (for all city-owned buildings) would be more appropriate in light of the city's new computerized building management system. Also some areue that some rolling stock should be eligible for capital budget financi�g." (new wording underlined) ,�9�� city of saint pa� � planning comr�ssion reso�tion file number �8-86 Wte N^v°mhor 1R 19RR WHEREAS, the Planning Commission is charged with responsibility for development and review of policy to guide the Unified Capital Improvement Program and Budget Process (UCIPBP) ; and WHEREAS, the Planning Commission has reviewed the policies adopted as part of the 1988-1989 Saint Paul Capital Allocation Policy and has revised them; and WHEREAS, the Planning Commission released the revised Capital Allocation Policy for public review and held a public hearing on the document on November 4, 1988; and WHEREAS, discussions held during the period of public review have resulted in additional revisions to the Capital Allocation Policy; NOW, THEREFORE, BE IT RESOLVED that the Planning Commission hereby approves and adopts the policies entitled Saint Paul Capital Allocation Poiicy: 1990-1994, as revised; and BE IT FURTHER RESOLVED that copies of the document be transmitted to the Mayor and City Council of the City of Saint Paul for review and adoption. mVV�id �. MG DONEL•L. �Ci'VI I�.�u � NEID � �� s . � � �� i9�8' SAINT PAUL CAPITAL ALLOCATION POLICY 1990-1994 . � - � �' Adoption of all but Financial Policies (Section 3.3) rocommended by the Finance, Ma.nagement and Personnel Committee of the City Council on January 23, 1989` - � � � .! � PLAIlT�i�1�tG�..Y-I��i � DEPARTMENT OF PLANNING AND ECONOMIC DEYELOPMENT CITY HALL ANNEX " 25 WEST FOURTH STREET SAINT PAUL, MINNESOTA \55102 ��i��' TABLE OF CONTENTS 1.0 Introduction 1 1.1 Purpose of Saint Paul's Capital Improvement 1 Budgeting Process 1.2 Stages of Saint Paul's Capital Improvement 1 Budgeting Process 1.3 Components of the Capital Allocation Policy 6 - 1.4 Why Have a Policy for Capital Allocation? 6 1.5 How is the Capital Allocation Policy Used? 6 � 1.6 Organization of This Document 7 r 2.0 Strategic Goals g 2.1 What Are Strategic Goals? 8 2.2 Why Have Strategic Goals? 8 2.3.0 Types of Strategic Goals 9 2.3.1 Planning Goals 9 G1: Basic Services 10 G2: _ Neighborhood Management and Housing 10 " G3: Business and Jobs ° � 10 2.3.2 Fiscal Goals 11 G4: FiscalIntegrity 11 3.0 Policies for Capital Allocation !2 3.1 Project Policies 12 PI: Comprehensive Plan 12 ' P2: New Facilitios 12 P3: Skyways 12 P4: Handicapped Accessibility 13 � PS: Program Allocations 13 P6: Extraordinary Capital Maintenance 14 � P7: Redevelopment Activities 15 P8: Residential Street Paving 15 P9: Dupli�ation_of Scrvices 15 P10: Financing for Preliminary Studies I S PI1: Assessment Policy 15 3.2.0 Evaluatioa Policies 16 ��i�� 3.2.1 Planning Evaluation Policies 16 E 1: Level of Service 16 E2: Program for Capital Improvements (PCI) 17 E3: Departmental Evaluation 17 E4: Environment . 18 ES: Aesthetics/Public Arts Considerations 18 E6: Neighborhood Development Strategy 18 E7: District Council Ranking 18 E8: District Plan 18 E9: Housing 19 J E10: Historic Preservation 19 El l: Business Development Strategy 19 E 12: Job Creation l9 � ' E13: Business Investment l9 3.2.2 Fiscal Evaluation Policies 20 E 14: Impact on Operating Budget 20 E15: Impact on City Revenues 20 E 16: Grants 20 E17: Private Investment 20 E 18: Acquisition 21 E 19: 3oint Use 21 E20: Continuation Projects 22 E21: Programming and Phasing 22 E22: Use - 22 E23: Consolidation of Facilities - 22 E24: Fiscal Impact Analysis 23 3.3 Financial Policies 23 F1: Financing Sources 23 _ F2: Commnnity Development Block Grant 24 (CDBG) Program F3: Bond Financing 24 F4: Tax Increment Financing 25 F5: HRA General Fund 25 F6: HRA Development Fund 25 J F7: Rehabilitation Loan Funds 25 F8: Sale/Leaseback 26 F9: UDAG Reinvestment 26 ' F 10: Tax Abatement 26 F11: Multi-Ycar Projection of Capital 26 Financing Sources 4.0 Future Directions for the Capital Improvement 27 Budgeting Proccss � �� 4.1 Short-Term Actions (1988-1989) 27 A 1: Recategorizing Capital Functions 27 A2: Capital Function Strategies for the 27 Program for Capital Improvements A3: Capital Functions and the Comprehensive 28 Plan 4.2 Long-Term Actions (1990 and Beyond) _28 A4: City Plan Elements and Departmental 28 Needs Assessment Procedures � AS: Past Expenditures by Capital Function 29 ' A6: District Strategies for Capital 29 Improvements A7: Connection Between the Capital and 30 Operating Budgets • A8: Capital Investment for Social Services 30 5.0 Definitions 31 Appendix A: City of Saint Paul Mission Statement 33 Appendix B: Elements of Saint Paul's Comprehensive Plan 34 � Appendix C: Overall Budget Goals 36 App�ndix D: Capital Funetion Strategies _ 39 " Appendix E: Public Improvemen�Assessment Policy 43 Appendix F: Estimated Financing Sources for Saint Paul's 48 Capital Improvements: 1990-1994 i ��,�r�' 1.O INTRODUCTION -------------------------------------------- 1.1 PURPOSE OF SAINT PAUL'S CAPITAL IMPROVEMENT BUDGETING PROCESS The purpose of Saint Paul's capital improvement budgeting process is to plan, program and finance capital improvements in a way that is both fiscally responsible and accountable to the citizens of the city._As such, this process _ contributes to the fulfillment of Saint Paul's mission, expressed in a statement adopted by the City Council (see Appendia A). � To ensure that the purpose of the process is fulfilled, two citizen advisory bodies work to develop a recommended capital improvement budget: 1) P1�unln� Commission. An important responsibility of the Planning Commission is to determine what kinds of capital systems are ne�ded to maximize Saint Paul's potential as a plaee to live and do business. The city's Comprehensive Plan, developed by the Planning Commission, provides considerable guidance concerning desirable future capital investment for Saint Paul. In the capital improvement budgeting process, the Planning Commission translates the Comprehensive Plan into focused policies to guide the city's choice and timing of capital improvement projects. Appendix B is a list of the elements of Saint Paul's Comprehensive Plan. � 2) Long-Range Capital Improvem�nt Budget Commtttee (CIB Committee)." Along with �ts task forces, this citizen's committee evaluates and prioritizes capital improvement budget proposals. The priorities assigned by the CIB Committee are the basis for the capital improvement budget which the Mayor recommends to the City Council for it to adopt. In addition to these advisory bodies, Saint Paul's 17_Citizen Participation Districts provide important input into the capital improvement budgeting process. The CIB Committee and task forces have one representative from each Citizen Participation District. Moreover, District Council ratings are a criterion for evaluating and prioritizing proposed projects. ------------------------------------------- 1.2 STAGES OF SAINT PAUL'S CAPITAL IMPROVEMENT � BUDGETING PROCESS Saint Paul's capital improvement budgeting process has three stages: _ 1) Capjtal Allocation Policy (CAP). The CAP is a set of poliey statements to guide capital improvement budget prapc�ala and their evaluation. The CAP is related both to the city's Comprehensive Plan and to the city's Budget Goals and Policies. The Comprehensive Plan identifies the systems and dovelopment patterns needed to maximize the city's potential as a place to live and work; the Budget Goals and Policies outlinc principles of financial prndenee to prioritiae city service delivery activities. (See Appendix C for a summary of Saint 1 Paul's 1989 Budget Goals and Policies.) By articulating city objcctives for capital investment, the CAP functions as a bridge between thc Comprehensive Plan and the Budget Goals and Policies. The Planning Commission prepares the CAP in consultation with the Mayor's Office and city departments. Following a period of public review, the Planning Commission adopts the CAP and transmits it to the Mayor who reviews the CAP and transmits it to the City Council for their approval. The adopted CAP has a five-year time horizon but is revised every two years, prior to the adoption of a capital improvement budget. 2) Capital Improvement Budget. City departments, District Councils and other parties submit proposals for capital projects. These proposals � are evaluated and prioritized by the Saint Paul Long-Range Capital Improvement Budget Committee (CIB Committee) and its task forces. '£he primary evaluative tool of the CIB Committee is a rating sheet � which incorporates material from the CAP as well as from other sources. The CIB Committce and task forces are composed of representatives of Saint Paul's 17 Citizen Participation Districts. Based on the recommendations of the CIB Committee, the City Council adopts a two-year budget. 3) Program for Capit�l Improvements (PCI). The ten-year PCI is adopted by the Planning Commission, reviewed by the Mayor and approved by the City Council shortly after the capital budget is adopted. The PCI is a list of intended future capital improvements which organizes important projects according to ycars of fund expenditure, estimated cost and expected financing source. The PCI also prioritizes projects and categorizes them within one of 11 capital - - functions. The first two years of the PCI consist of projects already financed by the capital budget. Years 3-S are phases of projects which need to be financed to continue commitments made in the capital budget. Years 6-10 include projects which city departments have identified as being important but are not yet covered by financing commitments. The intent of this format is to match years 1-S closely to actual or anticipated finances; it is less necessary for projects in years 6-10 to match ezpected financing Ievels. Hawever, projects in years 6-10 will be categorized according to their level of priority. The PCI is prepared by the Planning Commission in consultation with the Mayor's Office and with city departments. The PCI becomes part y of the Comprehensive Plan upon its adoption. Although three stages in the capital improvement budgeting process have r been identified, the process is actually a cycle in which each activities in each stage rely on activities in preceding stages. For example, the CAP requires that proposed projects be evaluated concerning their conformance with the most recent PCI. Thns, althe�n�h the CAP is tht foandation, it slso draws from other components of the process. Figure 1 illustrates the stages of the process. Figure 2 exhibits the roles played by various parties in the capital budgeting process. 2 _ �-�r�' � Thc capital improvemont budgeting process described above is somewhat different from the process which has been used in Saint Paul in the past. In 1987 and 1988 a Joint CIB Committee/Planning Commission task force studied the role of the Planning Commission in the capital improvement budgeting process. The task force recommended several. changes in this process. Both the Planning Commission and the CIB Committee adopted the task force recommendations and this version of the CAP begins implementing those recommendations. Important changes in the CAP include a change in its time horizon. Previously, the CAP was applicable for two years; the new CAP will have a five-year time horizon (with revisions every two years). Other changes have _ been made to clarify the CAP's format and to strengthen its strategic focus. It is also notable that, in the new process, the PCI, will be adopted after the - capital improvement budget is adopted; previously the PCI preceded the � adoption of the budget. Although the new CAP embodies some of the recommended changes in the capital improvement budget process, other changes will occur within a longer time frame. Chapter 4 discusses future directions which should be pursued to continue implementing the recommended changes. � 3 _ FIGURE 1 SAINT PAUL'S CAPTTAL IMPROVEMENT BUDGETING PROCESS � Capital Allocation Policy (CAP) Sets 5-year policy direction for the_capital - improvement budget pmposals and their evaluation. Evaluation of PCI in light , of Comprehensive Plan leads to revision of CAP Program for Capital Improvements(PCn Sets 10-year program by tying capital needs Evaluation and prioritization to long-range policy of the Comprehensive of proposed capital projects Plan. CIB becomes first 2 years of PCI Capital Improvement Budget(QB) Appropriates funds for 2 years of capital - projects. Identifies tentative expenditures needed within the next five years to complete _ cutrendY aPProved projects. � , � ��0 FIGURE 2 PROCESS OF DEVELOPING THE CAPITAL ALLOCATION POLICY r...�... -• �....� �.. . . . Bud�et Staff Plannin$Staff Propose.s: fiscal goals Proposes:- planning goals - - project policies(fiscal) - project policies(planning) - fiscal evaluation policies - planning evaluation policies - financial policies � CIB Committee Approves:- fiscal goaLs - project policies(fiscal) - fiscal evaluation policies - financial policies PLnnin¢('ommi��cioe 1. Prepares CAP fo�public review 2. Holds public hearing 3. Adopts CAP �SYQt � Reviews and recommends CijT Conncil _ Adopts CAP � - -------------------------------------------- 1.3 COMPONENTS OF THE CAPITAL ALLOCATION POLICY The 1990-1994 CAP consists of a set of Strategic Goals (Planning Goals and Fiscal Goals) and three sets of policy statements (Project Policies, Evaluation Policies and Financial Policies). The Strategic Goals function as the rationale for the policies. 1) Project Poltcies. Used to determine if, and under what conditions, a proposed project is eligible for capital financing. If the proposed project does not violate the limits established by the Project Policies, its merits are then evaluated. In practice, most proposals are not affected by these policies. 2) Evaluation Pol[cies (Planniag Evaluat[on Policies; Fiscal Evaluation Policies). Used to evaluate the merits of proposed projects which are eligible for capital financing. The CIB Committee assigns points and � ranks proposed projects using a rating sheet which incorporates material from the Evaluation Policies. Financing sources are then sought for the highest ranking proposals. 3) Financial Poticles. Used to determine what sources of financing can be used for specific projects. The most narrowly-targeted form of financing is assigned to each proposal so that financing can be found for as many good proposals as possible. In short, the three types of policies lead to a recommended capital budget which consists of the highest-ranking eligible projects for which capital financing is available. -------------------------------------------- 1.4 WHY HAVE A POLICY FOR CAPITAL ALLOCATION? Proposals for capital improvement projects in Saint Paul generally have costs which exceed the amount of available capital resources. To provide the greatest benefit to the city, the Capital Improvement Budget must finance the projects which address the greatest needs. For this reason, it is essential to determine the relative priority of proposed projects and allocate resources accordingly. _ The CAP helps insure that high priority projects meeting city goals are funded during the budget biennium. It transforms city goals and priorities into a set of policies that guide capital improvement budgeting decisions. ` � ------------ -------------------�------- 1.5 HOW IS THE CAPITAL ALLOCATION POLICY USED. The primary f unction of the CAP is to provide guidance to the CIB Committee and its task forces as they evaluate capital improvement proposals and recommend a capital improvement budget to the Mayor and City Council. To fulfill this function properly, thc CAP must accomplish two tasks. First, it must articulate citywide goals which relate to capital improvements. Secondly, it must transform these goals into policies which 6 ��-��r� provide clear guidance concerning priorities for the upcoming capital budget. These policies must enable the :CIB Committee to evaluate proposed projects thoughtfully. Two other functions stem from the primary function of the CAP. First, the CAP helps District Councils, city departments and other parties develop capital improvement proposals. By stating the criteria for evaluating proposals, the CAP indicates what types of proposals are most likely to be evaluated favorably by the CIB Committee and its task forces. Secondly, the CAP helps the Mayor and City Council coordinate budget decisions for capital improvements with long-range operating and maintenance obligations of the city. _ � 1.6 ORGANIZATION OF THIS DOCUMENT ------------ Chapter 1.0 - Provides a general introduction to this document. Chapter 2.0 - Prosents the Strategic Goals which are thc foundation of the city's policies for capital allocation. Two types of Strategic Goals are presented: Planning Goals and Fiscal Goals. Chapter 3.0 - Contains a discussion of three types of policies for allocating city capital resources: Project Policies, Evaluation Policies (Planning and Fiscal) and Financial Policies. Chapter 4.0 - Discusses future directions for the city's capital improvement budgeting process. Chapter S.0 - Provides definitions of some important terms. � - 7 2.0 STRATEGIC GOALS -------------------------------------------- 2.1 WHAT ARE STRATEGIC GOALS? Strategic Goals are statements which provide the direction and framework for the three sets of policies which are detailed in Chapter 3.0. Most notably, Strategic Goals create the categories for the Evaluation Policies that are translated into a rating sheet by_the CIB Committee. The rating sheet is then used to evaluate individual proposals. Strategic Goals are "goals" in that they articulate what kind of city Saint Paul should seek to become. They are - "strategic" because they acknowledge the limitations of the city's capital resources and provide a sense of priorify for pursuing c�rtain types of projects over others. a During the upcoming capital budgct cycle, the evaluation of individual proposals will be based on policies which stem from the Strategic Goals of the CAP. However, capital programming in city departments will continue to be structured by "Capital Function Strategies" which articutate guidelines for the development of particular types of capital systems. The Planning Commission and the CIB Committee have recommended that Capital Function Strategies should be incorporated into the CAP, be tied more directly to the city's Strategic Goals, and be used to evaluate individual proposals. Appendix D contains the city's current Capital Funetion Strategies. Chapter 4.0 includes a discussion of how the city should proceed to incorporate Capital Function Strategies fully into the CAP. - The Strategic Goals (Chapter 2.0) and the Policies for Capital Allocation (Chapter 3.0) are stated in separate chapters. The intent of this structure is to emphasize that Strategic Goals are not policy. Instead, they are guidelines for the development of policy. The policies articulated in Chapter 3.0 are the authoritative interpretation of the meaning of the Strategic Goals. In future years even greater precision will be provided as Capital Function Strategies are incorporated fully into the_CAP. The Capital Function Strategies will serve to clarify the intent of the Strategic Goals and to strengthen the foundation of the Policies for Capital Allocation. ------------------------------------------- 2.2 WHY HAVE STRATEGIC GOALS? The main reason why Strategic Goals are needed is that the city's capital resources are limited. These limitations take several forms. Most of the city's non-bonding revenue comes from stat� and federal sources and is _ � limited by how much aid these governmcnt units make available to Saint Paul, and by limits to uses of various financing sources set by the government providing the aid. Beyond that, the city is constraincd by state legal limits on municipal bonding and by a more siringent stlf-imposcd limit on bonding designed to reduce overlapping g�neral obligation debt. Appendix F displays th� estimated financing sources availabl� for capital projects from 1990 to 1994. _ 8 ��,Q�� In addition to the limits on revenue sources, the city's financial resources are constrained by past commitments to multi-year projects which have not been completed. Financially, the most significant of these is the commitment to separate the city's combined storm and sanitary sewers. In 1985, the Minnesota Legislature produced a funding partnership which allowed this accelerated sewer separation program to be adopted in Saint Paul. The legislative package commits the city, the metropolitan area, and the state to complete separation by 1995 at a cost of $150 million (in 1985 dollars). 2.3.0 TYPES OF STRATEGIC GOALS -------------------- The Strategic Goals have two complementary foci: Planning and Fiscal. The Planning Goals (G1-G3) relate to the desirability of projects without regard � to cost or financing. The purpose of th�se goals is to articulate what kind of community Saint Paul should become and what kind of public activities can help bring about that type of community. In contrast, Fiscal Goals (G4) establish principles of prudent financial management for the city's capital improvement budget. Both types of goals are necessary to ensure that Saint Paul's public investments yield the maximum benefits. The Planning Goals are based on the Planning Commission's recent Saint Paul Tomorrow study. This study ineluded a statistical profile of the city (Saint Paul Today) and an extensive survey process designed to "listcn" to the community in a comprehensive way. Finally, a series of workshops involving a wide variety of citizens worked to define issues and identify new directions for the city. The Pl�nning Commission synthesizcd this work into a final report which it adopted in 1987. Because.the purpose of the Saint Paul Tomorrow project was�o build a foundation for strategic planning in ' � Saint Paul, this study is the most appropriate source of Planning Goals for the CAP. The Fiscal Goals reflect relevant "General Budget Goals' from th� City of Saint Paul 1989 Budget Goals and Policies, a document adopted by the City Council. 2.3.1 PLANNIN.G GOALS � ------------ The recommendations of the Saint Paul Tomorrow report rest on a consensus: Saint Paul should maximize its potential as a place to live and do business. , This consensus has been articulated in a mission statement for the city which has been adopted by the City Couneil. Appendix A contains the complete text of Saint Paul's mission statement. The foUoxias three Planning Cuals are b$sed on this coasensus. These goals are intended to be sufficiently general to apply to a widc variety of city activities, but sufficiently specific to be helpful for capitat budgeting decisions. The goals are stated in order of priority. 9 - ' G1: Basic Services o Goal: To provide Saint Paul residents and employers with a basic level of city services. o Discussion: 'This Strategic Goal has three important implications. First, it identifies residents and employers as the citizenry which the city should serve. Secondly, it implies that a "basic' level of service can be defined and should be provided to all city citizens. Finally, by speaking of "city services," this goal acknowlcdges that some important services are properly provided by parties other than city _ government. City government should focus on the services that it can most equitably and efficiently provide. G2: Neighborhood Management and Housing o Goal: To support the careful management of Saint Paul ' neighborhoods, each according to its own best potential. o Discussion: This Strategic Goal has several implications. First, it identif'ies neighborhoods as the focus of community life in Saint Paul. Second, it highlights the importance of the city as a residential environment. Good neighborhood manag,ement should lead to the provision of attractive housing opportunities for a broad spectrum of the city's population. Third, it sugg�sts that � areas of Saint Paul--outlying areas and downtown--belong to neighborhoods. Fourth, it indicates that conscious neighborhood managemcnt is necessary. Such management should involve both neighborhood self-management and managemcnt by city officials. Finally, it stresses the notion of ` "potential," suggesting that -different neighborhoods `have different potentials. Policies and projects which are appropriate in one - neighborhood may not be in another neighborhood. G3: Bus[ness aad Jobs o Goal: To ensure a supportive environment for businesses and jobs. o Discussion: This goal implies that city governmcnt should not limit its activities to residential concerns but should also promote economic _ development. At its best, such promotion should be broad and general. That is, the city should be most interested in creating a "supportive environment" for economic development. Aid for particular kinds of businesses or for individual businesses must be guided by this broader framework. This goal also acknowledges that businesses are not ends in themselves, but are integrally connected to jobs and to other public amenities. The best economic development will be that which does the most to enhance Saint Paul as a place for everyone—for businesses and ' also for city residents. . 10 - -------------------------------------------- ��Q�� 2.3.2 FISCAL GOALS G4: FiscalIntegrity o Goal: To help preserve the fiscal integrity of the city's operating, debt service and capital improvement budgets by engaging in careful and thorough analysis of each capital improvement proposal including the long-range impact on operating costs and revenue generation. o Discussion: This fiscal goal reflects those general city goals for budgeting from City Council adopted "1989 Budget Goals and Policy" _ which impact upon the evaluation of specific proposals for capital improvements. The complete list of general goals from that document is included as Appendix D. This goal recognizes two basic factors. . First, proposals for capital improvemcnts must be evaluated against basic criteria which measure the fiscal responsibility of the project as proposed. Secondly, proposals for .capital improvements must be evaluated against criteria which measure their impact on the city's operating and debt service budgets. It is essential to recognize the close tie between the city's operating and capital improvement budgets. New or eapanded facilities financed thraugh the capital improvement budget may increase th� need for operating bt�dget resources. Conversely, appropriate capital investments can decrease operating expenses. But operating budget decisions can also affect the capital budget. For example, deferral of maintenance or other operating costs may result in increased capital improvement expenditures as facilities deteriorate prematurely. � 11 3.0 POLICIES FOR CAPITAL ALLOCATION ------------------------------------------- 3.1 PROJEC'T POLICIES Project Policies consist of statements which limit or prohibit certain types of projects. These policies are used to determine if, and under what conditions, a proposed project is eligible for capital financing. P1: Comprehensire Plan Proposals for projects which clearly conflict with the city's Comprehensivc Plan will n� be considered for financing. The y Planming Commission shall review all proposals for capital improvement financing to determine if they are consistent with the Comprehensive Pian. P2: New Fscillttes , Proposals'for certain types of new facilities will g�be considered for financing in 1990-1991. These facilities are: a. Swimming pools. b. Facilities to house programs or services which are not provided by the city. � c. New library or recreational servi�e facilities which will increase operating and maintenance expenses. Expanded, rehabilitated or replaeement of existing inadequate library or recreational facilities which will require an increase in staff will be considered � the improvement is consistent with a plan approved by the City Council which identifies the need for the improvement. d. Multi-service centers, nu less the following conditions are met: " 1. Community need has been demonstrated through a feasibility - study; 2. All conditions of the multi-service center plan, including � ideniification of tenants, have been met; and 3. There will be no requirement for city financing of operating � _ or maintenance costs at the facility. P3: Skyw�ys In 1987, the City Council adopted the following policies concerning thc financing of skyways: 1. The City may participate in the financing of skyway bridges if such bridges support City priorities for downtown devclopment. 12 ��/9/� 2. The City may participate in the financing of appropriate projects to retrofit existing skyways with automatic doors and to install electronic security equipment in the skyways. 3. A City reserve fund may finance the City's portion of major skyway enhancement or replacement of eaisting skyways connecting buildings which the City owns or l�ases. 4. The City will not participatc in the financing of skyway approaehes and concourse corridors. In addition, the following policy from the citx's 1989 Budget Goals . and Policies is relevant: 5. The annual costs of operations, maintenance (both current and - preventive) and roof replacements for skyways should be assessed to the property owners of the buildings linked by the system. Additionally, a capital replacement reserve will be established and an appropriate amount assessed to the property owners. P4: Handicapped Accessibility All new facilities must be handicapped accessible. All proposals for the rehabilitation or remodeling of facilities must consider the option of making the facility handicapped accessible, must estimate the cost of pursuing this option and, if handicapped accessibility is not provided, must include a written justification for not providing handicapped accessibility. � P5: Progrim Allacations A program allocation is a lump sum amount given to fund a serics of capital projects which are consistent in nature and implemented sequentially until an identified objective is reached. An example of a program allocation is the combined street and sewer program. All requests for capital improvement financing of program allocations must be accompanied by: 1. Program guidelines which are consistent with applicable city plans and capital allocation policies. These guidelines should be � adopted if the program has been financed in prior years. 2. The number of years the program is eapected to continue to � operate, or an identification of the conditions which would result in the termination of the program. _ _ 3. A list of the specific activities that were completed with program money during the two years preceading the application ycar, including thc cost of each activity. � 4. A list of all transfcrs, whether by resolution or administrative ordcr, out of the program to other projects or programs dnring each of the two years prior to the year of the current request. 13 S. A list of all outstanding balances, by year including the current budget year, if the program has been financed previously. 6. Identification of the amount of money which is required each year for program activities. P6: Extraordiniry Capital M��ntenance An objective of the city is to protect its capital investment through regular, scheduled preventive maintenance of its capital facilities, financed through the operating budget. However, because preventive maintenance activities have not been fully financed in past years, some capital facilities require extraordinary capital maintenance. To " address such extraordinary capital needs, the city will consider budgeting up to 5350,000 per year in 1990 and 1991 for extr�ordinary capita! maintenance. Adequately financed programs for regular " preventive maintenance would, in time, reduce the need for an eatraordinary capital maintenance program, It is hoped that prcventive maintenance--both ordinary and extraordinary--will become a high city priority. In the long run, deferred maintenance is not a cost-effective way of managing scaree financial resources. Extraordinary capital maintenance is defined as the replacement, renovation, remodeling and/or retrofitting of the structural parts and/or service system components of a building, and the man-made components of an improved site. 1. Structural narts include footings and foundations; beams, joists, columns; load bearing walls, exCerior walls and facade _ (excluding glass); stairs, floors, decks, ramps, ceilings; roofts and roof ing. 2. Service svstem comoonents include plumbing, electrical, communications, heating, ventilating, air conditioning, security systems and elevators; utility mains. 3. Site comnonents include retaining walls, lighting, stairs, � ramps, sidewalks, railings, fencing, drainage structures, and erosion control. Priority consideration will be given to those site components whose condition affects building components identified above. Any work financed through the extraordinary capital maintenance J program must have a life expectancy that exceeds the terms of the bonds used to finance it, or must be financed with non-bonded fund sources. Ongoing maintenance and routine preventive care and � upkeep of facilities shall be financed through the city's operating budget. Except in cases of emergency, work projects fiaaaced through the extraordinary capital maintenanee program must have costs which " exceed SS,000 and are less than s75,000. Smaller work projects shall normalty bc financed through tho city's operating budget. Larger work projects shall normally be financed through the regular CIB process. 14 -,��' �� Guidelines shall be developed for administering the eatraordinary capital maintenance program. The guidelines shall be reviewed by the CIB Committee and approved by the City CounciL P7: Redevelopment Activittes In the future, the City will use Capital Improvemant Bonds to finance redevelopment project activities as defined in Minnesota Statutes, section 469.002, subdivision 14, in accordance with Minnesota Statutes, section 469.041, clause (6). In the past, theso activities were financed with urban renewal bonds. Saint Paul's authorization to issue urban renewal bonds has been repealed in eachange for an cquivalent . increase in the city's Capital Improvement Bond authorization and the authority to use a portion of this authorization for redevelopment activities. (Section Chapter 513 of the Laws of Minnesota, 1988.) � The maaimum amount of Capital Improvement BonaY��nancing available is a590,000 in 1990; $620,000 in 1991; 5655,000 in 1992; and 5690,000 in 1993. P8: Residential Street Pavin� Residontial street paving projects will only be financed in conjunction with sewer separation projects, except in situations where a project is required to prevent hazardous conditions that threaten life, health or safety. P9: Dupticatton of Serrices Projects which duplicate existing public or. private services that are available to the same population withia the given geographic area ' ' shall not be funded. � P10: Financin� for Preliminary Studies The City mav finance studies such as environmental impact statements or engineering studies which ezamine alternative designs for a specific project � the specific capital improvement has been approved for inclusion in the Tentative Program of Commitments. Needs assessments are g� appropriate capital improvement .budget expenditu�res. Studies which eaamine alternative uses for specific sites or capital facilities are not appropriate capital improvement budget capenditures unless they are necessary components of a major - citywide project to which the city has made a virtual commitment. Such a project shall be included in the Tentative Program of Commitments only upon the recommendation of both the Planning - Commission and the CIB Committee. The Planning Commission's recommendation shall be based on a preliminary_ study, performed by the Planning Commission, , which indicates the need for a more detailed study of alternatives. Long-term debt should not be used to finanee studies for such projects. P 11: Asseasment Pollcy A summary of the city's public impravement assessment policy is contained ia Appendix E. 15 ------------------------------------------- 3.2.0 EVALUATION POLICIES If a proposcd project is eligible for capital financing, its merits must be evaluated. Thc CIB Committee evaluates the merits of proposals using a rating sheet which assigns points based on the Evaluation Policies of the CAP. The Evaluation Policies are closely linked to the CAP's Strategic Goals (Chapter 2.0). In essence, the Evaluation Policies define indicators which enable the CIB Committee to determine how well a proposed project fulfills _ the Strategic Goals. As was true with the Strategic Goals, there are two types of Evaluation � Policies. The first type (Planning) stem from the Planning Goals (G1-G3 in Chapter 2.3.1); the second type (Fiscal) derive from the Fiscal Goals (G4 in � Chapter 2.3.2). Planning Evaluation Policies and Fiscal Evaluation Policies shall receive equivalent emphasis. ------------------------------------------- 3.2.1 PLANNING EVALUATION POLICIES The Planning Evaluation Policies are organized according to which of the Planning Goals (G1-G3 in Chapt�r 2.3.1) they most closely support. El-ES: Policies Relating to Gl: To provide Saint Paul residents and employers with a basic level oj city services. E 1: Lerel of Service - In ovaluating proposed capital improvement projects, the following priorities shall be observed: a. First Priority: Projects which maintain quality basic services by preventing hazardous conditions. This priority category pertains to conditions that threaten life, health or safety. This category includes projects that prevent or correct hazardQUS situations and/or critical - breakdowns, and limit the city's exposure to liability. Most of the capital improvements in this priority category are required to prevent emergencies. b. Second Priority: Projects which maintain quality basic services by systematically repairing or replacing existing sorvices. This priority category includes projects relating to the systematic repair, ^ _ rehabilitation or replacement of physically deteriarated or functionally obsolete facilities. By addressing these needs on a systematic basis, the city can ensure the structural integrity of its capitat facilities, prevent potential health and safety hazards, and limit tho city's potential exposure to liability. Projtcts that increase energy efficiency in existing facilities are also included in this _ category. c. Third Priority: Projects which maintain quality basic services by bringing a developed area up to a basic service levcl. Some developed areas of the city are not presently served at the basic level. These - 16 ��-��' pockets of lower service levels have generally been identified in plan documents. Capital improvements that bring such areas up to a basic service level arc included in this category. Pro jects that make an existing facility handicapped accessible are also included in this category. d. Fourth Priority: Projects which maintain the support system and/or backup facilities for quality basic services. The support system includes administrative offices and facilities for communication, storage, training and education, and repair and maintenance. Capital improvements in this category should directly support the ability of city government to provide services efficiently and effectively. e. Fifth Priority: Projects which expand eaisting services in planned redevelopment areas, as identified in the Land Use element of the . Comprehensive Plan or in action plans such as the Energy Park Master Plan. f. Siath Priority: Projects which provide new services. g. Seventh Priority: Projects which expand existing services in an area where land is undevelopod and not fully served by municipal infrastructure. E2: ProQram for Capital Improvements (PCI) In evaluating proposals for capital projects, the following priorities shall be observed: a. First Priority: Projects whiCh closely conform to the PCI in terms of scope, timing and cost. - b. Second Priority: Projects which are included in the PCI but significantly differ from the PCI in terms of scope, timing or cost. c. Third Priority: Projects which are not included in the PCI. E3: Departmental Evaluation In evaluating proposals for capital projects, the following priorities shall be observed: _ a. First Priority: Projects which departments identify as critical to the fulfillment of their mission during the upcoming capital budget cycle. The relevant department must explain why it regards the proposed � project as critical. b. Second Priority: Projects which departments identify as high priorities, although not critical to the fulfillment of their mission during the upcoming capital budget cycle. c. Third Priority: Projects which departments identify as low priorities. d. Fourth Priority: Projects which departments identify as being of questionable validity. The relevant department mnst explain why it regards the proposai as having questionable validity. 17 ' E4: Environment In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably contribute to the improvement of environmental quality (air and water quality, noise levels). Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. E5: Aesthetics/Public Art Considerations _ In evaluating proposals for capital projects, preference shall be granted to projects which demonstrate a concern for aesthetics by incorporating public art considerations as a significant component in the planning and design phases of the project. E6-EIO: Policies Relating to G2: To support the careful management of Saint Paul neighborhoods, each according to its own best potential. E6:. Nelghborhood Development Strategy In evaluating proposals for capital projects, the following priorities shall be observed: a. First Priority: Projects which demonstrably are a component of a systematic neighborhood development strategy involving both public - and private�development activities. b. Seeond Priority: Projects whieh demonstrably are a component of a systematic neighborhood development strategy involving only public development activities. c. Third Priority: Projects which are not demonstrably a component of a neighborhood development strategy. _ E7: District Council R�nking In evaluating proposals for capital projects, priorities shall accurately refl�ct District Council ratings of proposed projects. E8: District Plan " In evaluating proposals for capital projects, preference shall be _ granted to projects which demonstrabiy contribute to fulfilling the . . � objectives of relevant District Plans (as adopted by District Councils). Projects which demonstrably conflict with District Plans shall be penalized. Projects which have a neutral or indeterminate impact relative to ihis objective shall neither be penalized nor given preference. i8 - ��,��' E9: Housin� In evaluating proposals for capital projects, prefcrence shall be granted to projects which demonstrably support the maintenance and upgrading of thc city's eaisting sound housing stock, while seeking to improve deficient housing and to generate construction of new, affordable housing choices in character with the neighborhoods surrounding them. Projects whieh demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. E 10: Historic Preservation In evaluating proposals for capital projects, preference shall be � granted to projects which demonstrably contribute to historic preservation. Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this ob jective shall neither be penalized nor given preference. Ell-E13: Policies Relating to G3: To ensure a supportive environment Jor businesses and jobs. E 11: Buslness Development Str�ttegy In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably support a systematic business � � development strategy for an area which includes Saint Paul. Projecfs which demenstr�bly conflict with this objective shall be ptnaliZed. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. E 12: Job Creation In evaluating proposals for capital projects� preference shall be granted to projects which demonstrably support the creation or retention of a substantial number of now jobs in Saint Paul or job opportunities for Saint Paul residents. Projects which �emonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither _ be penalized nor given preference. E 13: Bus�ness Investment � In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably stimulate substantial new business investment in Saint Paul. Projects which demonstrably � conflict with this objective shall be penalized. Projects whicb have a neutral or indeterminate impact relativc to this objective shsll ne�ther be penalized nor given preference. 19 3.2.2 FISCAL EVALUATION POLICIES ------------------- E 14: Impact on Operatiag Budget In evaluating the merits of each proposaL• a. Projects which will result in a decrease in city operating and maintenance expenses will be given special consideration. b. Projects which will result in an increase in city operating and maintenance costs will be penalized. c. Pro jects which have a neutral or indeterminate impact relative to " this objective shall neither be penalized nor given preference. E15: Impact on City Revenues ` a. Projects that increase revenue to the city will be given special consideration. b. Projects that reduce revenue to the city will be penalizcd. c. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. E 16: Grants The city shall actively seek grants from other units of government or the private sector to finance projects which are consistcnt with - - adopted city plans and policies and the priorities of the city. Special consideration shall be given to capital improvement requests that will be used as a match for such grants if the project does not result in an increase in city operating and maintenance costs and if the project does not reduce revenue to the city. E 17: Private Investment Capital improvement proposals that leverage committed private investment will be given special� consideration. Pro jects designed specifically as incentives to private development or redevelopment should meet the following criteria: a. Leveraae auidelines: Minimum leveraging is 1:6 (each public dollar y should leverage at least 6 private dollars). This ratio may be as low as 1:3 if the project: � 1. is directly associated with neighborhoodfcity partnership efforts; 2. creates permanont jobs for city residents; " 3. is directly related to development of low and moderate income housing; 4. is directly related to conservatian of nonrenewable energy resources or developmeni of energy alternatives; or - 20 �-�9��' � S. includes adequate space for a licensed child care center as part of the project. b. Return on investment: A project associated with a numbered exception to the leverage policy is subject to the following minimal return policies: l. The return in terms of tax revenues cannot be less than the cost of additional services required by the projcct; and _ 2. Additional tax revenues generated from the project must be _ sufficient to repay the city's investment over the lifetime of the asset provided. � E18: Acquisition A project that involves acquisition may be given the same priority as a project which does not if: a. The acquisition is related to public development or reuse and: 1. Right-of-way of easements are necessary; , 2. The parcel(s) havc been prcviously identified for conversion to park use if they become available; or 3. The parcel(s) have taa excmpt status and a use which is consistent with city plans, policies- and priorities has been clearly identificd. ` � b. The acquisition is related to private developmeni or reuse and: 1. The proposed reuse is consistent with city plans, policies and priorities and: . a) There is a reasonabl� expectation that development will occur in the immediate future; or - b) There is an economic advantage to the city to acquire the property and th� city can dispose of it within the reasonably foroseeable future. E 19: Joint Use � A facility that will be financed and operated by the city and another agency, or other operating departmcnts or divisions within the city, will be given special consideration if: a. It is consistent with city plans, policies and priorities; b. It can be constructed and operated more efficiently and effectively at less cost than a stparate facitity; 21 c. Operation and maintenance expenses for the facility will be shared jointly by the city and the other agency, or other operating departments or divisions within the city; and d. It does not result in an increase in city operating or maintenance costs or reducc revenue to the city. E20: Coatlnuatioa Projects The funding needs of a capital improvement project that received a prior budget appropriation for construction plans or a construction _ phase normally have priority over a new project or program allocation. Feasibility studies are not prior commitments. Acquisitioa and preliminary design do not constitute prior commitments unless � financing for construction plans has been approved and included in the CIB Committee's schedule of tentative future commitments. Annual programs are not considered continuation projects. ' E21: ProQramming �nd Phasing A proposed project should be adequately programmed and phased. This m�ans that: i a. A proposal which is justified by city plans, policics and priorities and is coordinated with other improvements at a cost saving to the city will be encouraged. b. A project must be timed with other improvements planned for the area within the next.five years. c. Only the amount which can reasonably be expected to be expended - in the budget year will be budgeted. Money required to complete the project will be identified in the schedule and will constitute a tentative commitment subject to City Conncil adoption of a budget appropriation for each year of the project. E22: Use The extent to which a project will be used will be taken into _ consideration. Also, efforts shall be made to ensure that projects meet the needs of the economically disadvantaged. This means that: a. The greater number of people served by a project, the greater the consideration that should be given to a project. Administrative units - shall be considered separately from neighborhood facilities. b. Projects used year-round will be given greater consideration than � projects used primarily on a seasonal basis. E23: Consotidstion of Facilities A proposal which consolidates existing city facilities should be given special consideration if ongoing operating and/or maintenance costs will be reduced. 22 - � � ��i� E24: Fiscal Impact An�lysis Proposals which involve a new service or expanded level of service must iaclude as part of the proposal an analysis of the impacts of the project on the city's operating costs and revenues. -------------------------------------------- 3.3 FINANCIAL POLICIES Financial Policies help the CIB Committee to determine what source of financing should be used for particular projects. Numerous financing _ sources for capital projeets are available to the city. However, many of them are earmarked to be used only for certain types-of projects. By assigning the most narrowiy targeted financing sources to the best projects, the CIB , Committee is able to recommend financing of the optimal package of projects. F1: Financin� Sources Determination of which financing source is most appropriate for each of the city's capital improvement budget priorities will be made as follows: a. Recommended capital improvcments which are subject to assessment will be so assessed under the city's Special Assessment Policy.� The policies currently in effect were adopted on December 23, 1976 as Council File No. 268302 and amended June 17, 1980 by Council File No. 275110; May 17, 1984 by Council File No. 84-632; and February 11, 1986 by Council file i�io. 86-162. b. Recommanded capital improvements located on Municipal State Aid, County Aid or Minnesota Trunk Highway routes and eligible for one or more of these financing sources will be financed to the extent allowable with money allocated to the city specifically for these routes. c. Recommended capital improvements which are eligible for metropolitan, state or federal programs or private grants should be so financed. If appropriate, CDBG or CIB money may be used to provide local matching funds. _ d. Recommended capital improvements which can be financed with specific bonding authority may be so recommended if City Council has indicated its intention to use such authority. Recommended � capital improvements which can be financed with revenue bonds or revenue from an existing Taa Increment District should be so financed. e. Recommended capital improvements or portions thereof and programs eligible for CDBG financing should be so financed. f. Recommended capital improvements which cannot be financed with money governed by paragraphs (a) through (e) will be considered for Capital Improvement Bond Financing. 23 F2: Community Development Block GrAnt (CDBG) ProQram Projects proposed for financing through the CDBG Program must meet the federal guidelines issued by the U.S. Department of Housing and Urban Development. This means that: a. Projects must be included in the list of eligible activities contained in the federal regulations. b. Projects must either principally benefit low and moderate income persons, eliminate slums and blight, or meet a community need having a particular urgency. _ c. Of the total CDBG dollars which are allocated to projects, most - should principally benefit low and moderate income persons or be located in areas which meet the Department of Housing and Urban Development's definition of low and moderate income. The � remainder of the money may address slums and blight or community needs having a particular urgency. F3: Bond Flnancin� . a. The Joint Debt Advisory Committee recommendations allow the sale of up to �13,700,000 in Capital Improvement Bonds in 1990 and 514,500,000 in 1991. b. The city will issue up to 54,000,000 per year in special street assessment revenue bonds to finance 1990-1991 strtet paving work to be paid by benefitted property owners. The exact amount of bonding will b� determined by the specific projects scheduled and will be contingent on the amount of federal, state and city construction money available for sewer separation. c. The city may issue up to $7,910,000 in 1990 and $5,170,000 in 1991 in MSA project bonds. d. The use of revenue bonds to finance public improvement _ commitments for economic development projects is preferred over other financing sources. The city may consider using tax increment, taxable bonds, or tax-exempt revenue bonds in 199d or 1991 for the - following projects: 1. Riverfront development; 2. Downtown parking proposals; _ 3. Other project-specific public redevelopment costs which_ _ � leverage significant private investment or investment by the State of Minnesota. Such bond issues may be general obligation bonds if there is a dedicated revenue source to cover the interest and principle payments and if there is backup financingother than property tax revenues to cover the debt service. �q � � � �-�9��' F4: Tix Iacrement Finaacing a. Revenue projections by consultant: revenue projections for all tax increment proposals should be analyzed by an outside financial consultant rather than a bond consultant. b. Debt service from bond sale proceeds: debt service for all taa increment projects will be paid from bond proceeds for no more than the first three years of project implementation when no tax increments or other project revenues are generated. c. Other costs funded from bond sale proceeds; all costs relating to _ any tax increment proposal should be funded with bond proceeds and included in the justification of each proposal. These costs include, but are not limited to: design, acquisition and relocation, � construction, bond consultant fees, bond counsel fees, financial consultaat fees and staff time. FS: HRA General Fund The HRA General Fund will be used for redevelopment of blighted areas as designated in city plans. Projects funded through the HRA General Fund must be physical improvements which will result in the revitalization of the community. The use of the HRA General Fund is governed by the state municipal housing and redevelopment law (Minn. Statutes, Chapter 469). Uses of the fund include acquisition, clearance, relocation, rehabilitation and public improvements. F6: HRA Derelopment Fund Like the HRA General Fund, the purpost of the HRA Developmcnt Fund is to redevelop blighted areas as designated in city plans. Projects funded through the HRA Development Fund must be physical improvements which will result in the revitalization of the community. However, at least 5096 of the H1�A Development Fund must be used for redevelopment activities within the boundaries of the 7th Place Redevelopment Area and Tax Increment District (roughly bounded by St. Peter and Market St. to the west,-1 lth St. and 9th St. to the north, Robert St. and Jackson St. to the east, and Sth St. and 4th St. to the south). The HRA Development Fund was established in 1983 in the resolution authorizing the sale/leaseback of the Civic Center (HRA Resolution - 83-10/13-2). Like the HRA General Fund, it is used for a�quisition, clearance, relocation, rehabilitation, public improvements, and project loans. F7: Rehabilitation Loan Funds City bond money used to provide residential and commercial rehabilitation loans shall be recycled for additional loans as the original loans are repaid according to the guidelines adopied by the Saint Paul City Council. CDBG money used to provide residential and 25 commercial rehabilitation loans, which return to the CDBG program as program income, shall be appropriated from the program income line item to provide new loans as the original loans are repaid. F8: Sale/Leaseb�ck Before any sale/leaseback agreements will be approved by City Council resolution, the following conditions must be met: a. The feasibility of the proposal must be analyzed by an independent fiscal consultant chosen by the city. Costs for such analysis must be borne by the initiator of the project if other than a city agency. b. The advice of the Long Range Capital Improvement Budget � Committee must be obtained. c. If the repurchase of the facility is part of the proposal, the package � should be structured to minimize repurchase costs and financing must be feasible. F9: UDAG Reinrestment As indicated by City Council Resolution No. 279820 (dated February 8, 1983) all Urban Development Action Grant (UDAG) program income, shall be distributed as follows: Fifty percent of the program income from an individual UDAG shall be set aside for eligible projects within the district(s) in which the UDAG is located. The remaining fifty percent of the program income shall be depositod in the citywide UDAG Revolving Loan Fund to be used for economic development purposes. UDAG program income is that percentage of - - any income earned by the city from tho disposition of proporty acquired with UDAG money, the repayment of any loans made with UDAG money, or any other revenues d�fined by the grant agreement as program income. All UDAG program income is administered according to HUD guidelines (Uniform Administrative Requirements for Grants and Aids to State and Local Governments). In accordance with these guidelines, proposals for re-use of program income are reviewed by the HRA Board and administered by HRA staff. F 10: Tax Abatement The city will not consider tax abatement as a development/ � redevelopment tool unless so detarmined by tho Mayor, and by City Council resolution, and with the exception of taa abatement assistance for low income rental housing development. (Council File Na 276807). _ FI1: Multi-Year Projection of Capitai Fteanciag Saurces Appendix F is a projection of all capital improvement financing " sources for the years 1990 through 1994. The five-year tentative program included in the biemnial capital budget shall not exceed these funding projections. 26 ��9��' 4.0 FUTURE DIRECTIONS FOR THE CAPITAL IMPROVEMENT BUDGETING PROCESS -------------------------------------------- The process of restructuring and improving the city's capital improvement budgeting process will require many deliberate actions yielding incremental but significant reforms. Some actions have already been incorporated into the 1990-1994 CAP; others should be performed in the near future; still others require a long-term time horizon. . 4.1 SHORT-TERM ACTIONS (1988-1989) ---------------- The most important short-term actions involving the CAP are those which will ensure that processes which are already undcrway will harmonize with new capital budgeting procedures. The following three actions' are recommended as top short-term priorities: A 1: RecategorizinQ Capit�i Functions Action: The Planning Commission and the CIB Committee should study alternative ways of categorizing capital functions to determine if the current system of eleven functions is most appropriate. Discussion: The current classification systsm is datad and in some cases does not correspond with budget management and accounting � - systems that are evolving in the city. For example, some city officials argue that a singte "city buildings" capital function (for all city-owned buildings) would be more appropriate in light of the city's new computerized building management system. Also, some argue that some rolling stock should be eligible for capital budget financing. The recommended study should be a top priority because classification categories are fundamental to all other refinements of the capital budgeting process. A2: Cipitii Finction Strate�iea for the Program for Capit�l Improvements Action: City departments and the Planning Commission should revise _ the Capital Function Strategies for the Program for Capital Improvements to reflect the priorities delineated in the Strategic Goals for the 1990-1994 CAP. � Discussion: The Planning Commission and the CIB Committee have recommended that Capital Function Strategies be integrated with the city's Strategic Goals. In this way, it is hoped, capital planning on the part of city departmeats will become moro focused strategically. Na�r that new Str�tcgic Gaals havc beea dcveloped, city departments should begin working with the Planning Commission to reshape the Capital Function Strategy statements to reflect these goals. The Planning Commission sltould also work to determino priorities among the city's capital functions. These actions should be completed in time for incluaion in th� I990-1994 Program for Capital Improvements. 27 A3: Capital Functions aad the Comprehensive Plan Action: The Planning Commission should consider how revisions in the Comprehensive Plan can better aid the capital improvement budgeting process. Discussion: The city has initiated a process to revise three key elements of the Comprehensive Plan--the Land Us� Plan, the Economic Development Strategy and the Housing Plan. Within this process, Economic Development and Housing should be considered as capital functions and their relationships with the Land Use Plan and with the capital budgeting system should be thoroughly explored. The lessons learned from this process should then be applied to planning for other capital functions. - 4.2 LONG-TERM ACTIONS (1990 AND BEYOND) ----------- • When the joint Planning Commission/CIB Evaluation Task Force studied the past performance of the city's capital improvement budgeting process, one of its major concern was that too much overprogramming was occurring in the PCI. Instead of providing a realistic multi-year._estimate of future capital projects, the PCI was recording all departmental needs, even though the cost of those needs far exceeded available city resources. A major reason for changing the process was to establish the two-year capital budget as a disciplined foundation for the .ten-year PCI that will be developed immediately theroafter: By recommending that years 3-5 of the next"PCI realistically rcflect expected financial resources,� the� task force further emphasized the nced for the city to prioritize strategically as part of - its capital programming process, not just at the time when the capital improvement budget is adopted. A corollary of the modified process is that the CAP must become a more effective guide to prioritizing projects. Although steps have been taken in _ the 1990-1994 CAP to move toward this goal, some of the task force recommendations require studies and actions which must b� deferred until later. In particular, the following actions should be pursued in 1990 or thereafter: A4: City Plan Elements snd Depsrtmental Needs Assessment Procedures Action: The Planning Commission should consider adopting the goal that all capital functions will be addressed in an element of the city's � Comprehensive Plan. The plan element would establish policies which prioritize types of projects within the relevant capital function and could establish a needs-assessment system to aid in prioritizing future proposed projects. Discussion: The responsibility for creating Capital Function Strategies is shared by the Planning Commission and city administrative departments. On the one hand, the Planning Commissian and CIB Committee have stated that thc Planning Commission should generate these statements to reflect citywide priorities. In theory, the Planning Commission should establish the capital function priorities which city . ' � LO . . � � . '. - �Q��' �� departments will then implement. In the past, however, the Planning Commission has relied significantly on city departments to formulate Capital Function Strategies. Up to a point, this reliance is justified. City departments are committed to serving the public interest and are uniquely qualified to determine what are city needs that can be fulfilled by particular capital functions. However, individual departments are not as qualified as the Planning Commission to determine how all capital functions should intcrrelate to fulfill different types of city needs. The proposed action is iatended to reconcile the tension between the _ need for departmental autonomy and the need for citywide accountability in the capital planning and programming process. City � departments should use their eapertise to identify problems that their . capital functions can help to solve. The Planning Commission will better be able to accept the departmental judgment if it can test that judgment against a rel�vant city plan element and an agreed-upon system for assessing needs. It would take several years for such procedures to be adopted and fully implemented. The process should begin with a Planning Commission study and evaluation of the way in which existing plan elements deal with capital functions and the way in which departmcnts assess capital function nccds. The study should also consider the status of city plans for capital functions which have been adopted by the City Council without Planniag Commission supervision, review or approval. Finally, the study should lead to a recommendation concerning what should be the Planning " Commission's role in capital function plan making and needs . assessment. _ A5: Past Expenditures by Capltil Function Action: The Planning Commission should analyze past expenditures by capital function, and assess whether and to what extent previous expenditures have fulfilled Strategic Goals of the city. (Specifically recommended by the Planning Commission/CIB Committee task force.) Discussion: This recommendation is intendod to help the Planning Commission establish spending priorities and incorporate them into _ Capital Function Strategies. A6: District Strategies for Capital Improvements Action: The Planning Commission should consider establishing uniform procedures which would enable District Councils to � incorporate capital planning and programming into District Plans. Discussiorr. The recommendation to consider encouraging District Councils to do capital programming arises from the Strategic Goal of improving neighborhood managemcnt capabilities. To ensure qnality control in this process, it would be important to establish uniform criteria for what constitutes an acceptable District strategy for capital improvements, and to provide training to Districts which choose to develop such a strategy. 29 - A7: Connection Between the Capital and Operating Budgets .4ction: City planning and budget staff should analyze the interaction between the capital and operating budgets. Based on this aaalysis, the Planning Commission and CIB Committee should provide more comprehensive evaluation criteria for capital projects regarding their impact on the operating budget. (Specifically recommended by the Planning Commission/CIB Committee task force.) Discussion: Currently, capital projects resulting in a decrease in city operating and maintenance expenses are given special preference in _ the capital budget review, while pro jects resulting in an increase in city operating aad maintenance costs are penalized. However, there - are many unanswered questions regarding the interaction between the - two budgets, and more extensive review criteria may be needed to _ provide better direction on this issue. A8: Capital Investment for Social Services Action: The Planning Commission should study ways to improve the CAP's ability to function as a decision framework for meeting social _ service needs in Saint Paul. However, this study should not be done in isolation from a study of the larger issue of the rightful responsibility of the city for the social needs of its citizens relative to the responsibility of other governmental units. Discussion: Some city administrators have commented that the eurrent CAP does not adequately function as a decision framework for the - city ta address social servica ne�ds. Because some capital investment "is related to social servicz needs, it- would be appropriate to improve the CAP in this respect. However, because the issues relating to social service provision extend far beyond questions of capital allocation, any substantive revision of the CAP should be part of a broader policy making effort. - 30 �� :�9�� S.0 DEFINITIONS Capital Expenditure A one time expense required to upgrade or add to the physical assets (land and buildings) of the city. In addition, capital eapenditures include incentives to the private sector to develop or re-develop assets not owned by the city. Capital Improvement Budgct - The annual capital imp_rovement budget shall _ include appropriations for all projects to be funded during the budget year which have an estimated useful life in eacess of three years, other than the " acquisition of office or mechanical equipment, vehicles or mobile equipment, . and minor remodeling or repairs of existing structures. The annual capital improvement budget shall include the proceeds of general obligation or revenue bonds of the city authorized by law, all aids, grants, and special revcnues received by the city for funding capital improvements, all monies appropriated by the City Council in the General Fund and Special Fund budgets for capital projects, and all special financing methods such as tax increment financing, long-term lease agreements, and sale-leaseback financing. A five year program which identifies the future costs associated with multi-year capital projects and any additional capital projects that are scheduled for implementation during the time of the program shall accompany each annual capital improvement budget. Eatraordinary Capital Maintenance - The replacement, r�novation, remodeling and/or retrofitting of the structural parts and/or service system � � components of a building, and the-man-made components of an improved sito. Structural parts include footings and foundations; beams, joists, columns; load bearing walls, exterior walls and facade (excluding glass); stairs, floors, decks, ramps, ceilings; roofs and roofing. Service system components include plumbing, electrical, communications, heating, ventilating, air conditioning, security systems and elevators; utility mains. Site components include retaining walls, lighting, stairs, ramps, sidewalks, railings, fencing, drainage structures, and erosion control. For maintenance purposes, the most important sitc components are those whose eondition affects the identified structural parts or service system components. Operating Budget - The annual operating budget is a 12-month financial plan which provides for delivery of city services; support and planning for service _ delivery; routine maintenance; minor remodeling and repairs of existing structures; acquisition of vehicles, mobile, mechanical, and office equipment; and other activities having an estimated useful life of less thaa three years. - Primary financing sources for the operating budget are property taxes, federal and state aids, dedicated revenues, user charges, and grants. Program Allocation - A program allocation is a lump sum amount given to fund a series of capital projects which are consistent in nature and are implem�nted sequentially in time until an identified o�jeative ia �eachcd. An ezample of a program allocation is the combined street and sewer program. 31 Subsidy Allocation - A subsidy allocation is assistance that the city gives to the private sector as inccntive for development or redevelopment of physical assets now owned or operated by the city. Subsidy allocations include loans, grants, matching funds, or acquisition and clearance. Tentative Program of Commitments - A section of the Capital Improvement Budget which estimates future annual appropriations needed to complete projects which have been initiated. _ � 32 _ � �-��r�' APPENDIX A CITY OF SAINT PAUL MISSION STATEMENT (FROM THE "CITY OF SAINT PAUL 1989 BUDGET GOALS AND POLICIES") -------------------------------------------- Ensure the provision of high quality services, which meet the people's priority _needs and which enhance the long term common good of the _ community within the constraints of available financing sources and reasonable taxing policies. _ City serviees must: produce effective results; be delivered efficiently, in a manner which is both timely and courteous; be in conformance with applicable laws; and . be delivered within the context of high moral and cthical values. Service delivery priorities include those which provide public safety, health and general welfare. Those services which strengthen all the neighborhoods as places to live, work, play, be educated and raise families are of particular importance. ` ` � City employees who arc the agents for delivering quality services and for ensuring the successful attainment of cstablished goals, shall be treated with respect and fairly rewarded for successful job performance. 33 APPENDIX B ELEMENTS OF SAINT PAUL'S COMPREHENSIVE PLAN -------------------------------------------- GENERAL ELEMENTS o Overview of the Plan _ o A Plan for Land Use o The Implementation Strategy -------------------------------------------- � CAPITAL FUNCTION PLANS o A Plan for Housing o Housing Implementation Program o A Plan for Streets and Highways o A Plan for Bicycles o Comprehensive Sewer Plan o Economic Development Strategy o A Plan for Parks and Recreation � o A Plan for Librari�s o A Plan for Multi-Service Centers o Program for Capital Improvements (1988-1992) DISTRICT PLANS -------------------------------- o District 1 Plan o District 2 Plan o District 3 Plan o District 4 Plan o District S Plan o District 6 Plan o District 6 Land Use Amendment o District 7 Plan o District 7 Plan Update o District 8 Plan o District 9 Plan ° o District 10 Plan o District 11 Plan _ o YOUniversity Avenuc Plan (District 11 & 13) o District 12 Plan o District 13 Plan o District 14 Plan o Grand Aveaue West Parking and Zoning Report (District 14) o Grand Avenue Design Guidelines Amendment (District 14 & 16) _ o District 1 S Plan o Hightand Village Plan Amendment (District 15) o District 16 Plan o Graad Avenne East Design Guidelines Amcndment (District 16) o Downtown Development Plan (District 17) 34 �r�./�/� o Downtown Development Plan--Miller Hospital Site Land Use Amendment (District 17) o Status of District Plans as Part of Comprehensive Plan -------------------------------------------- - SUB-AREA PLANS o River Corridor Plan o Downtown Framework o Summit Avenue Plan o Lower Cathedral Hill Plan 35 o employee,training; o employee well being; o employee child care; and o competitive bidding for certain services. SG6 Modernize the physical and organizational structure of City departments and offices to facilitate better management of resources. Create an environmcnt which encourages innovative problem sotving and pursuit of opportunities to improve service delivery within existing budgets. SG7 Provide adequate budget resources to address the long-term program needs for essential human service dClivery coordination, better neighborhoods and economic dovelopment. -------------------------------------------- FINANCING GOALS FG1 Finance essential city services which have a citywide benefit in the budget with revenue sources which are generated from a broad base, i.e. property taxes, state and federal aids, assessments and franchise fees. Finance responsive services (wherc the individual served controls the uso of the service) with dedicated revenue and user fees which directly relate to the level of service provided. Minimize General Fund financing assistance to those responsive service activities which have a common good community benefit but cannot - totally finance expenses with user fees. FG2 Minimize the impact and use of property tax financing by controlling costs and by seeking alternative financing for city services which focus on user fees for responsive services and by the upgrading and/or enhancement of the property tax base. FG3 Refine existing assessment financing formulas and user fee rate structures to more accurately charge the costs of service provided to the benefitting property owners and customers served, while being sensitive to the needs of low income peopla FG4 Support federal and state legislation that provides property taa relief and direct aid to cities, without reliance on regressive forms of � taxation while striving to eliminate funding of r�gional and state responsibilities at the local level. Oppose legislation which imposes local service mandates without federal, state, or regional funding. FGS Seek reform of Minnesota property tax laws to target property tax relief to cities to reduee tax base disparities, and to mor� fairly reduce the tax burdtn dis�rity among th� different classes of property. 38 � �-�� APPENDIX D CAPITAL FUNCTION STRATEGIES -------------------------------------------- CFS1 STREETS � The Department of Public Works has established a street condition analysis system and has surveyed all of the arterial streets. Evcry two years these s streets will be surveyed with the data entered into a computer. The condition of these streets will be monitored so that rehabilitation will be ' scheduled before complete failure of the street. This will save the city • money because rehabilitation is much less expcnsive than total reconstruction. All residential oiled streets are scheduled to be paved between 1986 and 2006. The first 10 years of this will be in conjunction with the 10-year sewer separation program. Trees continue to bc an important priority in street r�construction. Funds for boulevard tree planting may be included in project proposals. Depending on the type of street praject, the funding source for boulevard trees may vary: 1) Reco�struction Projects. Reconstruction proposals may include an estimate for tree planting on the boulevard. Because MSA dollars can only be used to replace" trces removed during recons�ruction, Public ' � Improvement Aid or Capital Improvement Bonds may be the proposed financing source for additional trce planting. Residential street paving proposals may also include boulevard tree planting. 2) Overlay Projects. Tree planting for street overlay projects may be financed as part of the street overlay proposal or may be financed through the Citywide Tree Planting Program. Sidewalk repair should be based upon the city's liability exposure. Lawsuits, complaints, and tke sidewalk condition survey should all be considered in determining which sidewalks are repaired. This work should not be assessed. This would eliminate the cost of time, paperwork, and temporary patching, . and result in a qnicker permanent repair. New sidewalks should be included when reconstructing collector or arterial • streets where technically feasible. The current assessment policies should be continued. CFS2 ST�tEET:LIGHTING --------------------------- The primary strategy of the street lighting section of the Department of Public Works is to improve the quality of street lighting through the installation of street lighting systems in coordination with street paving projects (or on an as-ac.edcd basis oa Northern States Power-owned wood poles) and to pres�rve or improve the quality of the existing infrastructure. 39 ---- ----------------- CFS3 TRAFFIC ENGINEERING The primary strategy for the traffic engineering section of the Department of Public Works is to maintain the infrastructure of the traffic signal and signing systems in the city. Project funds are dedicated to help improve the safe and efficient movement of traffic, both vehicular and pedestrian, through the city. This is accomplished by either doing small improvements on our existing traffic signals or signing systems or by installing new traffic , signals or signs on an as-needed basis. z -------------------------------------------- , CFS4 BRIDGES . The city's bridge program is committed to the replacement, renovation, repair and maintenance of all bridges and related structuros, in ordcr to protect the health and welfare of the public and the transportation system. The ecouomic welfare of the city and neighborhoods depends on the bridge system that links our neighborhoods with other communities and serves as crossing for natural, as well as unnatural, barriers. The bridge program is developed through an annual bridge inspection and inventory system for all bridges inside the city limits. The annual inspections, as required by law, are made of each structure, at which time the condition of all members and bridge components are noted and rated. The d6ficiencies noted as minor repair are scheduled for 'repair by Bridge Maintenance Forces. Repairs rcquiring extraordinary maintenance are - scheduled for rehabilitation, repair, renovation or replacement based on the condition ratings of the strnctures. Any structures or members noted in critical condition must be repaired immediately or closed to the public if supporting members cannot tolerate live load loadings. Bridges are posted for load restrictions if any deficiencies cannot be readily corrected. All bridge projects scheduled for rehabilitation or replacement are programmed for Capital Improvements and funding is pursued through the - Capital Allocation Policy and the Planning Districts. CFSS SEWERS ---------------------------------- . The strategic goal for the Sewer Division of the Department of Public Works , is to provide storm and sanitary sewer service. The high�st priority for capital project proposals is to complete the Sewer Separation Program as outlined in the Comprchensive Sewer Plan for the City of St. Paul - Part I. Stormwater Management Plan and as requir�d in the current federal and state pollniion abatement permit (NPDES: Pin 0025474). The proposcd capital projects will providc needed separate storm and sanitary sewers, will eliminate uwer backups into homes and businesses and will eliminate the bypassing of sewage to the river during heavy rainfalls. 40 _______________________ �� CFS6 PARKS AND OPEN SPACES The Division of Parks and Recreation's responsibility is to develop, operate, maintain and preserve a system of public parks, open space areas, natural resources and recreation facilities, and to ensure provision of cultural and recreational opportunities for all segments of the population. The Division must therefore continue to upgrade and replace existing facilities to maintain the Parks system infrastructure and build in the capability to respond to changing needs in the community. The Division's recently implemented needs assessment survey (July 1987) indicated that the � Division should provide a greater diversity of programs and facilities appealing to all age groups, and the project proposals submitted to the C.I.B. ` process will reflect this need. CFS7 LIBRARIES ----------------------- During the neat five years, the Division of Libraries will continue the renovation/repair work in its older buildings. By addressing these building needs, before they fall into a. state of disrepair, they will be brought up to code and will allow the delivery of library services in appealing, pleasant, comfortable facilities for the r�sidents of the communities. Included in these building needs is the arrangement of the library's collection of materials to facilitate the ease of access to these materials. This is true especially when addressing the Central Library where users must ` move about a four story building. � � Replacemcnt of any library building wili be determined by 1) the existing facility's physical condition, 2) demonstrated usage patterns, and 3) level of service needs. CFS8 POLICE -------------------------- The Police Department's capital strategy over the next several years will continue to center around our buildings. Specifically, the department will be looking to acquire a permanent Team Office site in the western part of the � city and also acquire the site now used by the East Team for the eastern half of the city. This will give the department long-term stability in the ' decentralization of Police services to the neighborhoods of Saint Paul. � --------------------- CFS9 FIRE AND SAFETY The Fire Department's Strategy Statement includes projects that we believe will be contained in the Fire DepartmenYs Ma.ster Pl�n which will be conducted in 1988-89. These projects may include the construction of an administration building at the training site facility, eapansion and renovation of existing fire stations, the purchase of addition real properties, - 41 - and construction of aew fire stations. These steps may be necessary because of consolidation of existing buildings and equipment, brought about by Master Plan recommendations and alternatives. The remaining facilities will be in need of improvements at the training facility, roof replacements, energy efficiency improvements, new heating, ventitation, and air conditioning systems. CFS10 MISCELLANEOUS CITYWIDE BUILDINGS (FACILITY --- MANAGEMENT SYSTEM) _ The focus on the next four years will be to record and analyze the costs in ' terms of labor, material, contract-out services and energy. The � documentation will be performed via a city-wide computer work-order system. The success of obtaining meaningful data will necessitate the V cooperation of all division/department facility managers on the system. The goal of the system is to better know what the city is spending to maintain its facilities. The system will also provide for the documentation of preventive maintenance activities, an effort necessary if the city is to stretch its facility dollars. CFS11 ECONOMIC DEVELOPMENT AND URBAN PRESERVATION � Capital programming in the Department of Planning and Economic Development is guided by the following objectives: 1) " To maintain, improve and add to the city's existing housing stock; 2) To facilitate the growth and development of business and job opportunities in the neighborhoods and downtown; 3) To ensure the best possible urban environment through well designesi physical improvements both in the neighborhoods and downtown. To fulfill the first objective, PED plans to continue and expand city - programs aimed at providing single family and rental housing rehabilitation through conventional and innovative financing mechanisms. PED also plans to continue to encourage neighborhood stability through the use of subsidies for low income families and affordable housing alternatives. ' The revitalization and expansion of neighborhood businesses can be assisted , _ through a variety of commercial strategies. PED plans to continue .to � encourage neighborhood commercial development through varied technical and financing assistance, including: costs associated with capital improvements, commercial rehabilitation, revolving loan programs and emplayment assistance through job creation and training section. In order to promote economic development in the central city, PED seeks to encourage development through a coordinated, well-balanced combination of physical improvements in the downtown area and the riverfront. - ,�2 / �� APPENDIX E PUBLIC IMPROVEMENT ASSESSMENT POLICY -------------------------------------------- SIDEWALBS New Construction c Residential, Commercial, Industrial (all property uses) • 10096 of cost to be assessed with long side subsidy for � residential properties to be the only eaception. (Long side subsidy is defined later in this report.) Residential property on aid street - 5096 of cost assessed. Reconstruction . Commercial, Industrial, Multi-Family, etc. 10096 of cost to be assessed. Residential 5096 of costs for frontage to be assessed. (Long side aid � � applies to residential property.) Subject to City Council Discrction: 10096 for all construction wider than S feet; 10096 of all additional costs for special treatment, surfaces, etc. When commercial type sidewalks are reconstructed or constructed on commercial streets, residential properties located on these streets will be assessed at current residential rates. -------------------------------------------- � STREET GRADING AND PAVING ' LOCAL OR NEIGHBORHOOD STREETS New Construction Residential, Commercial, Industrial (all property uses) 10096 of cost to be assessed. � (Long side aid to be considered for residential properties only.) 43 Reconstruction (when done as part of the city-wide street improvement program such as the Combined Sewer Separation and Street Reconstruction Program) Residential and Commercial 2596 of total cost to be assessed (1986 rates were $21.00 per assessable foot). ARTERIAL STREETS New Construction Variable percentage of cost to be assessed taking into account ' the special benefits received by the abutting properties as well , as the general benefit received by the city at large. Reconstruction Arterial streets meeting certain criteria are to be reconstructed with no assessments being levied against abutting properties. The criteria that must be satisfied is: 1. The street must be a street eligible for and receive its major funding from either County Aid, Municipal State Aid, or other funding not originating in the City of Saint Paul. 2. The street must be a street serving as an arterial street providing capacity for through traffic and thus providing - a substantial benefit to the general publie. EXTRAORDINARY MAINTENANCE All extraordinary maintenance and major repair items that, in the discretion of the Director of Public Works does not constitute reconstruction will_be funded from the Street Maintenance Fund and will not be assessed to specific properties. Asphalt overlays are to be considered as extraordinary maintenance. -------------------------------------------- SEWERS - SANITARY � New Construction � 10096 of cost_to be assessed, except for city aid because of long V side subsidy or other design constraints. � Reconstruction Sewer repair and maintenaace is currently financed through the sewer service fund and therefore not asussed. The Department of Public Works reports that there is no urgency in the foresceable future for major replacement of sanitary sewers. A4 � �� The Comprehensive Sewer Plan, adopted by the City Couacil recommends ultimately assessing 2596 of the costs of ma jor reconstruction. -------------------------------------------- SEWERS - STORM RELIEF (COMBINED SEWER SEPARATION PROGRAM) New Construction _ Continue present policy of assessing a portion of the cost against benefitted proporties. Approximately 2096 of the cost for storm � relief systems is recovered by assessment. The current rate is 3 � cents per square foot for residential properties and 7 1/2 cents • per square foot for commercial and industrial properties. This rate is reviewed annually. ------------------------------------------- ORNAMENTAL STBEET LIGHTING New Construction 10096 of cost to be assessed for all lighting construction costs associated either with the construction of an ornamental lighting system or the upgrading of an existing wood pole system to an ornamental system, except when done in connection with a City Street Improvement Program such as the Combined Sewer Separation and Street Reconstruction Program, in which case the � assessment rate will be based on the following: Residential and Commercial 25% of total cost to be assessed. (1986 rates were $2.00 per assessable foot.) ALLEY - GRADING-AND PAVING � ------------------- New Construction and Reconstruction � 10096 of cost to be assessed against benefitted properties. : -------------------------------------------- CURB AND GUTTER , New Construction and Reconstruction 10096 of cost to be assessed against benefitted properties when constructed on a separate basis. Long side aid applies to residential properties. When the entire street is being reconstructed, curbs and gutters are included in the overall paving cost. 45 ------------------------- LOCAL DRAINAGE PROBLEMS New Construction and Reconstruction 10096 of cost to be assessed against benefitted properties. WATER MAINS ------------------------------ New Construction 10096 of cost to be assessed against benefitted properties. + Reconstruction � . Variable percentage of cost to be assessed taking into account the special benefits received by the abutting properties. An example would be the need to increase the size of a street main to provide more water for fire protection. � ---------------------- UTILITY SERVICE CONNECTIONS The utility service connection referred to in this report is that portion of the service connection running from the street main to the property line. The portion running from the property line to the building is the exclusive responsibility of the property owner. � � New Construction 10096 of cost to be assessed against benefitted properties. Replacement The cost for replacing water or sewer service connections to be the responsibility of the affected property owner. LONG SIDE SUBSIDY FORMULA --------------- RESIDENTIAL PROPERTIES • : New Construction and Reconstruction of Surface Improvemcnts � (street, grading, sidewalk, etc.) Use full narrow street frontage plus 50% of the long side frontage. New Construction and Reconstruction of Underground Improvements (sewers, water mains) Use full narrow frontage, plus 10 feet for the first 125 feet of long side frontage plus full frontage for depths beyond 125 feet. 46 - ��-��' COMNIERCIAL PROPERTIES New Construction and Reconstruction of Surface Improvements Use full narrow frontage plus full long side frontage. (No long side subsidy.) New Construction and Reconstruction of Underground Improvements Use full narrow frontage, plus 10 feet for the first 100 feet of long side frontage plus full frontage for depths beyond 100 feet. . � � 47 s , APPENDIX F ESTIMATED FINANCING SOURCES FOR SAINT PAUL CAPITAL IMPROVEMENTS: 1990-1994 . ----'�--- ----1991--- ----1992--- ----'�--- ----'�--- . Assessaents 3T9,000 390,000 355,000 375,000 400,000 4 Rblic Iaprovement Aid 877,000 903,500 930,500 958,500 987,000 Sewer Availalaility Charges 500,000 500,000 500,000 500,000 500,000 Sewer Service Fund 850,000 850,000 850,�0 850,000 850,000 Sewer Service F�nd Reserve 6,800,000 6,800,000 6,800,000 6,800,000 6,800,000 S��iry Abstanent Fund 1,500 1,500 1,500 1,500 1,500 Yater Utitity: Surcharge 650,000 650,000 650,000 650,�0 650,000 Co�nity Development Blxk Grant 4,000,000 4,000,000 4,000,000 4,000,000 4,000,000 Ca�wtrity Development Grent Program Incane 325,000 325,000 325,000 325,000 325,000 Canty Aid 780,000 780,000 780,000 780,000 T80,0pp Federat Aid Urban 8,100,000 1,542,295 457,T05 0 O Metropotitan Parka & Open Space Grants 1,824,000 0 1,000,000 0 0 Mimesota Departmertt of Transportation - 0 0 0 0 p Mimesota Yater Pollution Control Grants 8,533,300 8,639,208 8,Tl8,761 8,910,442 9,044,099 Ilu�icipat State Aid 5,737,500 5,850,000 5,969,295 6,088,681 6,210,455 Tr�r�c Highway Funding 455,000 473,000 492,000 511,680 532,167 ----------- ----------- ----------- ----------- ----------- SIIBTOTAL: � NON-BONDING REVENUE 39,812,300 31,704,503 31,889,761 30,750,803 31,080,201 ----------- ----------- ----------- ----------- ----------- Capital I�rovement Bonds 14,000,000 14,800,000 15,700,000 16,600,000 1T,000,000 ` Special Assessment Street Improvement Bonds 2,871,450 2,871,450 2,871,450 2,871,450 2,871,i50 Tax Increment Bonds 2,049,800 30,700 0 0 0 Municipal State Aid Supported eonds 7,708,400 5,168,005 0 0 0 � ----------- ----------- ----------- ----------- ----------- ` � SUBTOTAI: GENERAL OBIIGATION DEBT 26,629,650 22,870,155 18,571,450 19,471,450 19,871,�50 . ----------- ----------- --•-------- ----------- ----------- TOTAI ESTINAT� FtMANCtNG 66,K1,950 54,57�i,65a 50,i61,211 5fl,22j,253 5Q,9S1,6b1 � .�'� � � ..�...,�..� 48 / � � � I �#�-eet��-:}�ric��,��s•tr �'fic 'en ineerin •li l�tin��e��er �l�ar�s � � ecr,�at � r t � _��, � �: � � �. �':�'' .� ., � ;. ., �� j. {{�� +�(� � :.. �. �'��:' �E�. i;�'�,1.3`F.��:5.�`, ' r'`�.;%.;�:. .'� � Y�.. ��4�� j�" . � ��\. . .1* ti: � �{��''�C��,E`�.��: `7 ,r, � ,!�� I. ..v � . 45` �:�. �� .�� u;: xt:+c,.� � �+v" � .§��`' V\ '� 't��1;��',�� /� ��' � �� ~ }� :� . �.v" - := :�;,':�-':� :4:'v. . � � \ i��.�� h�t �y,.., ii\'�:.:V+}..,,:.�+_ "?{.�.i+�.�,:i ��\,�. .�� \h\�,. v��Y:i�~�� :�^:�l l��Y{!�(:_�i`.�'.::�;:' -"�-l'��i�i: �`.'\t�`i�;5;:�``:';�y. �,:. k .r, �c„ .. �1!�;.�..":,.. 1 . �+ v ;.,�*, . . .,. � : . . 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L �. .j3�� .��' .\�..�+ vv}�• �v;.l'�'h.':�_:!i';:i,:..:.E::� *�:�. ��'' .,-�1��':{�'�.� � � ,�h� v.{� _�' � ,;,� 4 MH.,,�.,.}�. ��4 E 4 �� 4�{' -�a*'V. 2 1. � k ;� �.,. � .� �ttx�n�librar�+�s•�r� � s��'et�•pvlic+eie�nn�m�e de�eloplri�� .��;a . � . . � . � � � � ' � ' � � � � � , � � z . . - - _ . . . . _ - _ . • � � � i • � � � � � � • i � � � I� SAINT PAUL CAPITAL ALLOCATION POLICY 1990-1994 � � - � � � Adopted by the Saint Paul Planning Commission on November 18, 1988 ' � � �' r � � � PLANNING DIVISION DEPARTMENT OF PLANNING AND ECONOMIC DEVELOPMENT ' CITY HALL ANNEX 25 WEST FOURTH STREET SAINT PAUL, MINNESOTA 55102 � � � � TABLE OF CONTENTS � 1.0 Introduction 1 � l.l Purpose of Saint Paul's Capital Improvement 1 Budgeting Process 1.2 Stages of Saint Paul's Capital Improvement 1 Budgeting Process � 1.3 Components of the Capital Allocation Policy 6 1.4 Why Have a Policy for Capital Allocation? 6 1.5 How is the Capital Allocation Policy Used? 6 1.6 Organization of This Document 7 2.0 Strategic Goals 8 � 2.1 What Are Strate ic Goals? 8 8 2.2 Why Have Strategic Goals? 8 � 2.3.0 Types of Strategic Goals 9 � 2.3.1 Planning Goals 9 G1: Basic Services 10 � G2: Neighborhood Management 10 G3: Business and Jobs 10 � 2.3.2 Fiscal Goals 10 G4: FiscalIntegrity 10 , 3.0 Policies for Capital Allocation 12 � 3.1 Project Policies 12 � P 1: Comprehensive Plan 12 P2: Ntw Facilities 12 P3: Skyways 12 � P4: Handicapped Accessibility 13 PS: Program Allocations 13 P6: Extraordinary Capital Maintenance 14 P7: Redevelopment Activities 15 � P8: Residential Street Paving 15 P9: Duplication of Services 15 P10: Financing for Preliminary Studies 15 � P11: Assessment Policy 15 32.0 EvahuNtian Policies 16 � � � � 3.2.1 Planning Evaluation Policies 16 E l: Level of Service 16 E2: Program for Capital Improvements (PCI) 17 � E3: Departmental Evaluation 17 E4: Economically Disadvantaged 18 � ES: Environment 18 E6: Aesthetics/Public Arts Considerations 18 E7: Neighborhood Development Strategy 18 E8: District Council Ranking 18 � E9: District Plan 18 E 10: Housing 19 E11: Historic Preservation 19 � E12: Business Development Strategy 19 E13: Job Creation 19 E14: Business Investment 19 � 3.2.2 Fiscal Evaluation Policies 20 E 1 S: Impact on Operating Budget 20 E 16: Impact on City Revenues 20 E 17: Grants 24 � E18: Private Investment 20 E 19: Acquisition 21 E20: Joint Use 21 E21: Continuation Projects 22 � E22: Programming and Phasing 22 E23: Use 22 E24: Consolidation of Facilities 22 � E25: Fiscal Impact Analysis 23 � 3.3 Financial Policies 23 F1: Financing Sources 23 F2: Community Developm�nt Block Grant 24 j (CDBG) Program F3: Bond Financing 24 F4: Tax Increment Financing 25 � F5: HRA General Fund 25 F6: HRA Development Fund 25 F7: Rahabilitation Loan Funds 25 � F8: Sale/Leaseback 26 F9: UDAG Reinvestment 26 F10: Tax Abatement 26 F11: Multi-Year Projection of Capital 26 � Financing Sources � 4.0 Future Directions for the Capital Improvemont 27 Budgcting Proccss � � � � 4.1 Short-Term Actions (1988-1989) 27 A 1: Recategorizing Capital Functions 27 � A2:� Capital Function Strategies for the 27 Program for Capital Improvements A3: Capital Functions and the Comprehensive 28 � Plan 4.2 Long-Term Actions (1990 and Beyond) 28 � A4: City Plan Elements and Departmental 28 Needs Assessment Procedures � A5: Past Expenditures by Capital Function 29 A6: District Strategies for Capital 29 Improvements � A7: Connection Between the Capital and 30 Operating Budgets A8: Capital Investment for Social Services 30 � 5.0 Definitions 31 � Appendix A: City of Saint Paul Mission Statement 33 Appendix B: Elements of Saint Paul's Comprehensive Plan 34 � Appendix C: Overall Budget Goals 36 Appendix D: Capital Function Strategies 39 Appendix E: Public Improvement Assessment Policy 43 Appendix F: Estimated Financing Sources for Saint Paul's 48 � Capital Improvements: 1990-1994 � i � � � � � � � �� l�i� � 1.0 INTRODUCTION � -------------------------------------------- � 1.1 PURPOSE OF SAINT PAUL'S CAPITAL IMPROVEMENT BUDGETING PROCESS The purpose of Saint Paul's capital improvement budgeting process is to plan, � program and finance capital improvements in a way that is both fiscally responsible and accountable to the citizens of the city. As such, this process contributes to the fulfillment of Saint Paul's mission, expressed in a � statement adopted by the City Council (see Appendix A). To ensure that the purpose of the process is fulfilled, two citizen advisory bodies work to develop a recommended capital improvement budget: � 1) Pianning Commission. An important responsibility of the Plannin S Commission is to determine what kinds of capital systems are needed � to maximize Saint Paul's potential as a place to live and do business. The city's Comprehensive Plan, developed by the Planning Commission, provides considerable guidance concerning desirable � future capital investment for Saint Paul. In the capital improvement budgeting process, the Planning Commission translates the Comprehensive Plan into focused policies to guide the city's choice and timing of capital improvement projects. Appendix B is a list of � the elements of Saint Paul's Comprehensive Plan. 2) Long-Range Capital Improvement Budget Committee (CIB Comm[ttee). Along with its task forces, this citizen's committee evaluates and � prioritizes capital improvement budget proposals. The priorities , assigned by the CIB Committee are the basis for the capital improvement budget which the Mayor recommends to the City � Council for it to adopt. In addition to these advisory bodies, Saint Paul's 17 Citizen Participation � Districts provide important input into the capital improvemeat budgeting process. The CIB Committee and task forces have one representative from each Citizen Participation District. Moreover, District Council ratings are a � criterion for evaluating and prioritizing proposed projects. � -------------------------------- 1.2 STAGES OF SAINT PAUL'S CAPITAL IMPROVEII�NT BUDGETING PROCESS � Saint Paul's capital improvement budgeting process has threa stages: 1) Capital Allocation Policy (CAP). The CAP is a stt of policy � statements to guide capital improvement budget proposals and t�eir evaluation. The CAP is related both to the city's Comprehensive Pl�tn and to the city's Budget Goals and Policies. The Comprehensive Plan identifies the systems and dcvelopment patttrns needcd to �swimiu � the city's potential as a place to live and work; t�►e Budgot C�Oals and Policies outline principles of fin�ncial prndenee to prioritizc city service delivery activities. (See Appendix C for a summary of Saiat ,� 1 � Paul's 1989 Budget Goais and Policies.) By articulating city objectives � for capital investment, the CAP functions as a bridge between the Comprehensive Plan and the Budget Goals and Policies. � The Planning Commission prepares the CAP in consultation with the Mayor's Office and city departments. Following a period of public � review, the Planning Commission adopts the CAP and transmits it to the Mayor who reviews the CAP and transmits it to the City Council for their approval. The adopted CAP has a five-year time horizon but is revised every two years, prior to the adoption of a capital � improvement budget. 2) Capital Improvement Budget. City departments, District Councils and � other parties submit proposals for capital projects. These proposals are evaluated and prioritized by the Saint Paul Long-Range Capital Improvement Budget Committee (CIB Committee) and its task forces. � The primary evaluative tool of the CIB Committee is a rating sheet which incorporates material from the CAP as well as from other sources. The CIB Committee and task forces are composed of representatives of Saint Paul's 17 Citizen Participation Districts. � Based on the recommendations of the CIB Committee, the City Council adopts a two-year budget. 3) Program for Capital Improvements (PCI). The ten-year PCI is �, adopted by the Planning Commission, reviewed by the Mayor and approved by the City Council shortly after the capital budg�t is adoptcd. Thc PCI is a list of intended future capital improvemcnts � which organizes important projects according to years of fund expenditure, estimated cost and expected financing source. The PCI also prioritizes projects and categorizes them within one of 11 capital � functions. The first two years of the PCI consist of projects already financcd by � the capital budget. Years 3-S are phascs of projects which need to be financed to continue commitments made in the capital budget. Years 6-10 include projects which city departments have identified as being important but are not yet covered by financing commitments. The � intent of this format is to match years 1-S closely to actual or anticipated finances; it is Itss necessary for projects in years 6-10 to match expccted financing levels. However, projects in years 6-10 wi � be categorized accordiag to their level of priority. The PCI is prepared by the Planning Commissioa in consultation with � the Mayor's Office and with city departments. The PCI becomes part of the Comprehensive Plan upon its adoption. Although three stages in the capital improvement budgeting pracess have � been identified, the process is actnally a cycle in which each activities in each stage rely on activities in preceding stages. For �xample, the CAP requires that proposed projects be evaluated concerning their conformance � with the most recent PCL Thus, although the CAP is the fonndatiaa, it also draws from other componcnts of the process. Figura 1 iltnstrates tbe stages of the process. Fignre 2 �xhibits the roles played by varions parties in the capital budgeting process. � � 2 � The capital improvement budgeting process deseribed above is somewhat �. different from the process which has been used in Saint Paul in the past. In 1987 and 1988 a Joint CIB Committee/Planning Commission task force studied the role of the Planning Commission in the capital improvement � budgeting process. The task force recommended several changes in this process. Both the Planning Commission and the CIB Committee adopted the task force recommendations and this version of the CAP begins implementing � those recommendations. Important changes in the CAP include a change in its time horizon. Previously, the CAP was applicable for two years; the new CAP will have a � five-year time horizon (with revisions every two years). Other changes have been made to clarify the CAP's format and to strengthen its strategic focus. It is also notable that, in the new process, the PCI will be adopted after the � capital improvement budget is adopted; previously the PCI preceded the adoption of the budget. � Although the new CAP embodies some of the recommended changes in the capital improvement budget process, other changes will occur within a longer time frame. Chapter 4 discusses future directions which should be pursued to continue implcmenting the recommended changes. � � � � � � � � � � � � 3 � � FIGURE 1 SAIlVT PAUL'S '� CAPITAL IMPROVEMENT BUDGETING PROCESS � � Capital Allocation Policy(CAP) � Sets 5-year policy direction for the capital improvement budget proposals and their evaluation. Evaluation of PCI in light � of Comprehensive Plan leads to revision of CAP � Program for Capital Improvements (PCn � Sets 10-year program by tying capital needs Evaluation and prioritization to long-range policy of the Comprehensive of proposed capital projects Plan. � �. CIB becomes first 2 years of PCI � Capital Improvement Budget(CIB) Appropriates funds for 2 years of capital � pro�ects. Identifies tentative expenditures needed within the next five years to complete currendy approved projects. � � � � � � � � � 4 _ � FIGURE 2 � PROCESS OF DEVELOPING THE CAPITAL ALLOCATION POLICY � � . ._ . � Budget Staff Planning Staff � Proposes: - fiscal goals Proposes:- planning goals - project policies(fiscal) - project policies(planning) - fiscal evaluadon policies - planning evaluation policies � - financial policies � � CIB Committ� A�roves:- fiscal goals � - P�.lect Policies(6sca1) - fiscal evalnsdon poiicies - financial policus ' � � Plannin�CommLion 1. Prepares CAP for public review 2. Holds public hearing � 3. Adop�s CAP � � R�s and recommends � � C�' T Camcil Adopts CAP � � 5 � � -------------------------------------------- 1.3 COMPONENTS OF THE CAPITAL ALLOCATION POLICY The 1990-1994 CAP consists of a set of Strategic Goals (Planning Goals and � Fiscal Goals) and three sets of policy statements (Project Policies, Evaluation Policies and Financial Policies). The Strategic Goals function as the � rationale for the policies. 1) Project Policies. Used to determine if, and under what conditions, a proposed project is eligible for capital financing. If the proposed � project does not violate the limits established by the Project Policies, its merits are then evaluated. In practice, most proposals are not affected by these policies. � 2) Eraluation Policies (Planning Evaluation Policies; Fiscal Evaluat�on Policies). Used to evaluate the merits of proposed projects which are eligible for capital financing. The CIB Committee assigns points and � ranks proposed projects using a rating sheet which incorporates material from the Evaluation Policies. Financing sources are then sought for the highest ranking proposals. � 3) Financl�l PolIcies. Used to determine what sources of financing can be used for specific projects. The most narrowly-targated form of � financing is assigned to each proposal so that financing can be found for as many good proposals as possible. In short, the three types of policies lead to a recommended capital budget � ; which consists of the highest-ranking eligible projects for which capital financing is available. � ------------------------------------------- 1.4 WHY HAVE A POLICY FOR CAPITAL ALLOCATION? � Proposals for capital improvement projects in Saint Paul gen�rally have costs which exceed the amount of available capital resourcas. To provide the greatest benefit to the city, the Capital Improvement Budget must finance � the projects which address the greatest needs. For this reason, it is essential to determine the relative priority of proposed projects and allocate resources accordingly. � The CAP helps insure that high priority projects meeting city goals are funded during the budget �biennium. It transforms city goals and priorities � into a set of policies that guide capital improvement budgeting decisions. -------------------------------------------- � 1.5 HOW IS THE CAPITAL ALLOCATION POLICY USED? The primary function of the CAP is to provide guidance to tha CIB � Committee and its task forces as they evaluate capital improvement propossls and recommend a capital improvement budget to the Mayor and City ' Council. To fulfill this function properly, the CAP must accomplish two � tasks. First, it mnst articulate citywide goals which relate to capital improvements. Secondly, it must transform these goals into policies w►hich � 6 � provide clear guidance concerning priorities for the upcomin ca ital bud et.��J J/f o � S P 8 These policies must enable the CIB Committee to evaluate proposed projects thoughtfully. � Two other functions stem from the primary function of the CAP. First, the CAP helps District Councils, city departments and other parties develop � capital improvement proposals. By stating the criteria for evaluating proposals, the CAP indicates what types of proposals are most likely to be evaluated favorably by the CIB Committee and its task forces. Secondly, the CAP helps the Mayor and City Council coordinate budget decisions for � capital improvements with long-range operating and maintenance obligations of the city. � ------------------- --------------- 1.6 ORGANIZATION OF THIS DOCUMENT � Chapter 1.0 - Provides a general introduction to this document. Chapter 2.0 - Presents the Strategic Goals which are the foundation of the � city's policies for capital allocation. Two types of Strategic Goals are presented: Planning Goals and Fiscal Goals. � Chapter �.0 - Contains a discussion of three types of policies for allocating city capital resources: Project Policies, Evaluation Policies (Planning and Fiscal) and Financial Policies. � Chapter 4.0 - Discusses future directions for the city's capital improve�ent budgeting process. � Chapter 5.0 - Provides definitions of some important terms. � � � � � � � � � � � 2.0 STRATEGIC GOALS � ------------------�------------------------- � 2.1 WHAT ARE STRATEGIC GOALS? Strategic Goals are statements which provide the direction and framework � for the three sets of policies which are detailed in Chapter 3.0. Most notably, Strategic Goals create the categories for the Evaluation Policies that are translated into a rating sheet by the CIB Committee. The rating sheet is then used to evaluate individual proposals. Strategic Goals are "goals" in that they � articulate what kind of city Saint Paul should seek to become. They are "strategic" because they acknowledge the limitations of the city's capital resources and provide a sense of priority for pursuing certain types of � projects over others. During the upcoming capital budget cycle, the evaluation of individual proposals will be based on policies which stem from the Strategic Goals of � the CAP. However, capital programming in city departments will continue to be structured by "Capital Function Strategics" which articulate guidelines for the development of particular types of capital systems. The Planning � Commission and the CIB Committee have recommended that Capital Function Strategies should be incorporated into the CAP, be tied more directly to the city's Strategic Goals, and be used to evaluate individual � proposals. Appendix D contains the city's current Capital Function Strategies. Chapter 4.0 includes a discussion of how the city should proceed to incorporate Capital Function Strategies fully into the CAP. The Strategic Goals (Chapter 2.0) and the Policies for Capital Allocation � (Chapter 3.0) are stated in separate chapters. The intent of this structure is to emphasize that Strategic Goals are not policy. Instead, they are guidelines � for the development of policy. The policies articulated in Chapter 3.0 are the authoritative interpretation of the meaning of the Strategic Goals. In future years even greater precision will be provided as Capital Function Strategies are incorporated fully into the CAP. The Capital Function Strategies will � serve to clarify the intent of the Strategic Goals and to strengthen the foundation of the Policies for Capital Allocation. � -------------------------------------------- 2.2 WHY HAVE STRATEGIC GOALS? � The main reason why Strategic Goals are needed is that the city's capital resources are limited. These limitations take several forms. Most of the city's non-bonding revenue comes from state and federal sources and is , limited by how much aid these government units make available to Saint Paul, and by limits to uses of various financing sources set by the government providing the aid. Beyond that, the city is constrained by state � legal limits on municipal bonding and by a more stringent self-imposed limit on bonding designed to reduce overlapping general obligation debt. Appendix F displays the estimated financing sources available for capital � projects from 1990 to 1994. � 8 � In addition to the limits on revenue sources, the city's financial resources are r constrained by past commitments to multi-year projects which havc not been completed. Financially, the most significant of these is the commitment to � separate the city's combined storm and sanitary sewers. In 1985, the Minnesota Legislature produced a funding partnership which allowed this accelerated sewer separation program to be adopted in Saint Paul. The legislative package commits the city, the metropolitan area, and the state to � complete separation by 1995 at a cost of $150 million (in 1985 dollars). � -------------------- 2.3.0 TYPES OF STRATEGIC GOALS The Strategic Goals have two complementary foci: Planning and Fiscal. The � Planning Goals (G1-G3) relate to the desirability of projects without regard to cost or financing. The purpose of these goals is to articulate what kind of community Saint Paul should become and what kind of public activities can � help bring about that type of community. In contrast, Fiscal Goals (G4) establish principles of prudent financial management for the city's capital improvement budget. Both types of goals are necessary to ensure that Saint Paul's public investments yield the maximum benefits. � The Planning Goals are based on the Plannin Commission's recent Saint S Paul Tomorrow study. This study included a statistical profile of the city � (Saint Paul Today) and an extensive survey process designed to "listen" to the community in a comprehensive way. Finally, a series of workshops involving a wide variety of citizens worked to define issues and identify new � directions for the city. The Planning Commission synthesizcd this work into a final report which it adopted in 1987. Because the purpose of the Saint Paul Tomorrow project was to build a foundation for strategic planning in Saint Paul, this study is the most appropriate source of Planning Goals for � the CAP. The Fiscal Goals reflect relevant "General Budget Goals" from the City of � Saint Paul 1989 Budget Goals and Policies, a document adopted by the City Council. � ----------- -- --------------------------- 2.3.1 PLANNING GOALS � The recommendations of the Saint Paul Tomorrow report rest on a consensus: Saint Paul should maximize its potential as a place to live and do � business. This consensus has been articulated in a mission statement for the city which � has been adopted by the City Council. Appendix A contains the complete text of Saint Paul's mission statement. The fotlowing three Planning Goals are based on this consensus. These goals � are intended to bc sufficientiy general to apply to a widc variety of city activities, but sufficiently specific to be hetpfnl for capital budgeting decisions. The goals are stated in order of priority. � � 9 � G 1: Bastc Ser�lces � o Goal: To provide Saint Paul residents and employers with a basic � level of city services. o Discussion: This Strategic Goal has three important implications. � First, it identifies residents and employers as the citizenry which the city should serve. Secondly, it implies that a "basic" level of service can be defined and should be provided to all city citizens. Finally, by speaking of "city services," this goal acknowledges that some � important services are properly provided by parties other than city government. City government should focus on the services that it can most equitably and efficiently provide. � G2: Neighborhood Management o Goal: To support the careful management of Saint Paul � neighborhoods, each according to its own best potential. o Discussion: This Strategic Goal has several implications. First, it � identifies neighborhoods as the foeus of community life in Saint Paul. Secondly, it suggests that �, areas of Saint Paul--outlying areas and downtown--belong to neighborhoods. Third, it indicates that � conscious neighborhood management is necessary. Such managament should involve both neighborhood self-management and management by city officials. Finally, it stresses the notion of "potential," � suggesting that different neighborhoods have different potentials. Policies and projects which are appropriate in one neighborhood may not be in another neighborhood G3: Business and Jobs � o Goal: To ensure a supportive environment for businesses and jobs. � o Discussion: This goal implies that city government should not limit its activities to residential concerns but should also promote economic development. At its best, such promotion should be broad and general. � That is, the city should be most interested in creating a "supportiv� environment" for economic development. Aid for particular kinds of businesses or for individual businesses must be guided by this broader � framework. This goal also acknowledges that bnsinesses are not ends in themselves, but are integrally connected to jobs and to other public amenities. The best economic development will be that which does the most to enhance Saint Paul as a place for everyone--for businesses and � also for city residents. --------------------------------- � 2.3.2 FISCAL GOALS ---------- G4: FiscalIate�rlty � o Goal: To help preserve the fiscal integrity of the city's operating, debt service and capital improvement budgets by engaging in careful � and thorongh anatysis of each capital improvement proposal including the long-range impact on operating costs and revenue generation. � 10 � � o Discussion: This fiscal goal reflects those general city goals for budgeting from City Council adopted "1989 Budget Goals and Policy" which impact upon the evaluation of specific proposals for capital improvements. The complete list of general goals from that document � is included as Appendix D. This goal recognizes two basic factors. First, proposals for capital improvements must be evaluated against basic criteria which measure the fiscal responsibility of the project as � proposed. Secondly, proposals for capital improvements must be evaluated against criteria which measure their impact on the city's operating and debt service budgets. It is essential to recognize the close tie between the city's operating and capital improvement � budgets. New or expanded facilities financed through the capital improvement budget may increase the need for operating budget resources. Conversely, appropriate capital investments can decrease � operating expenses. But operating budget decisions can also affect the capital budget. For example, deferral of maintenance or other operating costs may result in increased capital improvement - � expenditures as facilities deteriorate prematurely. � � � � � � � � � � � � 11 � � 3.0 POLICIES FOR CAPITAL ALLOCATION � ------------------------------------------- � 3.1 PROJECT POLICIES Project Policies consist of statements which limit or prohibit certain types of projects. 'These policies are used to determine if, and under what conditions, � a proposed project is eligible for capital financing. P 1: Comprehensive Plan � Proposals for projects which clearly conflict with the city's Comprehensive Plan will � be considered for financing. The � Planning Commission shall review all proposals for capital improvement financing to determine if they are consistent with the Comprehensive Plan. P2: New Facilities � Proposals for certain types of new facilities will g�be considered for financing in 1990-1991. These facilities are: � a. Swimming pools. b. Facilities to house programs or services which are not provided by � the city. c. New library or recreational service facilities which will inerease , operating and maintenance expenses. Expanded or rehabilitated library or recreational facilities which will requirc an increase in � staff �aav be considered if the improvement is consistent with a plan approved by the City Council which identifies the need for the improvement. d. Multi-service centers, nu less the following conditions are met: � 1. Community need has been demonstrated through a feasibility � study; 2. All conditions of the multi-service center plan, including identification of tenants, have been met; and � 3. There will be no requirement for city financing of operating or maintenanee costs at the facility. � P3: Skyways In 1987, the City Council adopted the following policies concerning � the financing of skyways: 1. The City may participate in the financing of skyway bridges � ' � such bridges support City priorities for downtown development. � 12 � � 2. Thc City may participate in the financing of appropriate projects to retrofit existing skyways with automatic doors and to install electronic security equipment in the skyways. � 3. A City reserve fund may finance the City's portion of major skyway enhancement or replacement of existing skyways � connecting buildings which the City owns or leases. 4. The City will not participate in the financing of skyway approaches and concourse corridors. � In addition, the following policy from the city's 1989 Budget Goals and Policies is relevant: � 5. The annual costs of operations, maintenance (both current and preventive) and roof replacements for skyways should be � assessed to the property owners of the buildings linked by the system. Additionally, a capital replacement reserve will be established and an appropriate amount assessed to the property owners. � P4: Handicapped AccessibItity � All new facilities must be handicapped accessible. All proposals for the rehabilitation or remodeling of facilities must consider the option of making the facility handicapped accessible and must estimate the cost of pursuiag this option. � P5: Program Atlocations � A program allocation is a lump sum amount given to fund a series of capital projects which are consistent in nature and implemented sequentially until an identified objective is reached. An example of a � program allocation is the combined street and sewer program. All requests for capital improvement financing of program allocations must be accompanied by: � 1. Program guidelines which are consistent with applicable city plans and capital allocation policies. These guidelines should be � adopted if the program has been financed in prior years. 2. The number of years the program is expected to continue to operate, or an identification of the conditions which would � result in the termination of the program. 3. A list of the specific activities that were complet�d with � program money during the two y�ars preceeding the application year, including the cost of each activity. � 4. A list of all transfers, whether by resolution or administrative order, out of the program to other projects or programs dnring each of the two years prior to the year of the current requast. � S. A list of all outstanding balances, by yes�r including the current budget year, if the program has been financed previously. � 13 � � � 6. Identification of the amount of money which is required each year for program activities. � P6: Extraordinary Capital Maintenance An ob jective of the city is to protect its capital investment through � regular, scheduled preventive maintenance of its capital facilities, financed through the operating budget. However, because preventive maintenance activities have not been fully financed in past years, � some capital facilities require extraordinary capital maintenance. To address such extraordinary capital needs, the city will consider budgeting up to $350,000 per year in 1990 and 1991 for extraordinary � capital maintenance. Adequately financed programs for regular preventive maintenance would, in time, reduce the need for an extraordinary capital maintenance program. It is hoped that � preventive maintenance--both ordinary and extraordinary--will become a high city priority. In the long run, deferred maintenance is not a cost-effecEive way of managing scarce financial resources. Extraordinary capital maintenance is defined as the replacement, � renovation, remodeling and/or retrofitting of the structural parts and/or service syst�m components of a building, and the man-made � components of an improved site. 1. �truetural narts include footings and fonndations; beams, joists, columns; load bearing walls, txterior walls and facade � (excluding glass); stairs, floors, decks, ramps, ceilings; roofts and roofing. 2. Servic� svstem comoonents include pinmbing, electrical, � communications, heating, ventilating, air conditioning, security systems and elevators; utility mains. � 3. �ite comoonents include retaining walls, lighting, stairs, ramps, sidewalks, railings, fencing, drainage structures, and erosion control. Priority consideration will be given to those site � components whose condition affects building components identified above. Any work financed through the extraordinary capital maintenance � program must have a life expectancy that exceeds the terms of the bonds used to finance it, or must be financed with non-bonded fund sources. Ongoing maintenance aad rontine preventiva care and � upkeep of facilities shall be financed through the city's operating budget. Except in cases of emergoncy, work projects financed through the � extraordinary capital maintenance program must have costs which exceed a5,000 and are less thaa S75,Q00. Smaller work projects shall � normally be financed throngh the city's operating budg�t. Larger work pro,iects shall nor.mally be fiaanced throngh the regular CIB proccss. Guidelines shall be devcloped for at�tin�ter�ng tlee extraordinary � capital maintcnance program. Tht gtt�delines sLill be revie�ved by the CIB Committee and approved by the C'�ty Conncil. � 14 r ��`' ,��CJ � P7: Redevelo ment A tivl t p c t e� � In the future, the City will use Capital Improvement Bonds to finance redevelopment project activities as defined in Minnesota Statutes, section 469.002, subdivision 14, in accordance with Minnesota Statutes, � section 469.041, clause (6). In the past, these activities were financed with urban renewal bonds. Saint Paul's authorization to issue urban renewal bonds has been repealed in exchange for an equivalent � increase in the city's Capital Improvement Bond authorization and the authority to use a portion of this authorization for redevelopment activities. (Section Chapter 513 of the Laws of Minnesota, 1988.) The maximum amount of Capital Improvement Bond financing � available is $590,000 in 1990; 5620,000 in 1991; $655,000 in 1992; and $690,000 in 1993. � P8: Residential Street Pavtag Residential street paving projects will only be financed in con�unction with sewer separation projects, except in situations where a project is � required to prevent hazardous conditions that threaten life, health or safety. � P9: Duplic�tion of Servtces Projects which duplicate eaisting public or private services that are � available to the same population within the given geographic area shall not be funded. P10: Financing for Prelimin�ry Studies � The City mav finance studies such as environmental impact statements or engineering studies which examine alternative designs � for a specific project � the specific capital improvement has been approved for inclusion in the Tentative Program of Commitments. Needs assessments are � appropriate capital improvement budget � expenditures. Studies which examine alternative uses for specific sites or capital facilities are not appropriate capital improvement budget expenditures unless they are necessary components of a ma jor citywide project to which the city has made a virtual commitment. � Such a project shall be included in the Tentative Program of Commitments only upon the recommendation of both the Planning Commission and the CIB Committee. The Planning Commission's � recommendation shall be based on a preliminary study, performed by the Planning Commission, whieh indicates the n�ed for a more detailed study of alternatives. Long-term debt should not be used to � finaace studies for such projects. P11: Assess�ent Policy � A summary of the city's publie improvement assessment policy is Contained in Appendix E. � � 15 � � ------------------------------------------- 3.2.0 EVALUATION POLICIES If a proposed project is eligible for capital financing, its merits must be � evaluated. The CIB Committee evaluates the merits of proposals using a rating sheet which assigns points based on the Evaluation Policies of the CAP. � The Evaluation Policies are closely linked to the CAP's Strategic Goals (Chapter 2.0). In essence, the Evaluation Policies define indicators which � enable the CIB Committee to determine how well a proposed project fulfills the Strategic Goals. As was true with the Strategic Goals, there are two types of Evaluation � Policies. The first type (Planning) stem from the Planning Goals (G1-G3 in Chapter 2.3.1); the second type (Fiscal) derive from the Fiscal Goals (G4 in � Chapter 2.3.2). Planning Evaluation Policies and Fiscal Evaluation Policies shall receive equivalent emphasis. 3.2.1 PLANNING EVALUATION POLICIES ---------------- � The Planning Evaluation Policies are organized according to which of the � Planning Goals (G1-G3 in Chapter 2.3.1) they most closely support. E1-E6: Policies Rtlatin to Gl: To r v' � g p o ide Sarnt Paul restdents and employers with a basic level oj city services. EI: Level of Servlce � In evaluating proposed capital improvement projects, the following priorities shall be observed: � a. First Priority: Projects which maintain quality basic services by preventing hazardous conditions. This priority category pertains to � conditions that threaten life, health or safety. This category includes projects that prevent or correct hazardous situations and/or critical breakdowns, and limit the city's exposure to liability. Most of the � capital improvements in this priority category are required to prevent cmergencies. b. Second Priority: Projects which maintain quality basic services by � systematically repairing or replacing existing services. This priority category includes projects relating to the systematic repair, rehabilitation or replacement of physically deteriorated or � funetionally obsolete facilities. By addressing these needs on a systematic basis, the city can ensure the structural integrity of its capital facilities, prevent potential h�alth and safety hazards, and � limi� the city's potential exposure to liability. Projects that increase energy efficiency in cxisting facilities are also included in this category. c. Third Priority: Projects which maintain quality basic services by � briaging a developed area up to a basic sarvice level. Some developed areas of the city are not presently servcd at the basic level. Thcse � - 16 � � pockets of lowcr service levels have geaerally beea identificd in plan documents. Capital improvements that bring such areas up to a basic � scrvice level are included in this category. Projects that make an existing facility handicapped accessible are also included in this category. � d. Fourth Priority: Projects which maintain the support system and/or backup facilities for quality basic services. The support system includes administrative offices and facilities for communication, � storage, training and education, and repair and maintenance. CapitaT improvements in this category should directly support the ability of city government to provide services efficiently and effectively. � e. Fifth Priority: Projects which expand existing services in planned redevelopment areas, as identified in the Land Use element of the Comprehensive Plan or in action plans such as the Energy Park Master � Plan. f. Sixth Priority: Projects which provide new services. � g. Seventh Priority: Projects which expand existing services in an area where land is undeveloped and not fully served by municipal inf rastructure. � E2: Program for C�pital Improvements (PCI) � In evaluating proposals for capital projects, the following priorities shall be observed: � a. First Priority: Projects which closely conform to the PCI in terms of scope, timing and cost. b. Second Priority: Projects which are included in the PCI but � significantly differ from the PCI in terms of scope, timing or cost. c. Third Priority: Projects which are not included in the PCI. � E3: Departmentxl Evaluatlon In evaluating proposals for capital projects, the following priorities � shall be observed: a. First Priority: Projects which departments identify as critical to the � fulfillment of their mission during the upcoming capital budget cycle. The relevant department must explain why it regards the proposed project as critical. � b. Second Priority: Projects which departments identify as high priorities, although not critical to the fulfillmenf of their mission during the upcoming capital budget cycle. � c. Third Priority: Projects which departments identify as low priorities. � d. Fourth Priority: Projects which departments identify as being of questionable validity. The relevant departmont must eaplain why it , regards the proposal as having questionable validity. 17 � � E4: Economicalty Disadvanta�ed In evaluating proposals for capital projects, preference shall be � granted to projects which demonstrably focus on meeting the needs of the economically disadvantaged. Projects which demonstrably � conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. E5: Enviroament � In evaluating proposals for capital projects, preferenco shall be � granted to projects which demonstrably contribute to the improvement of environmental quality (air and water quality, noise levels). Projects which demonstrably conflict with this objective shall be � penalized. Projects which have a neutral or indeterminate -impact rela�,jve to this objective shall neither be penalized nor given preference. E6: Aesthetics/Pubtic Art Considerations � In evaluating proposals for capital projects, preference shall be � granted to projects which demonstrate a concern for aesthetics by incorporating public art considerations as a significant component in the planning and design phases of the project. - � E7-Ell: Policies Relating to G2: To support the careful management of Saint Paul neighborhoods, each according to its own best potential. � E7: Neighborhood Development Strategy In evaluating proposals for capital projects, the following priorities � shall be observed: a. First Priority: Projects which demonstrably are a component of a � systematic neighborhood development strategy involving both public _ and private development activities. b. Second Priority: Projects which demonstrably are a component of a � systematic neighborhood development strategy involving only public development activities. � c. Third Priority: Projects which are not demonstrably a component of a neighborhood development strategy. E8: District Council Rinking � In evaluating proposals for capital projects, priorities shall accurately � reflect District Council ratings of proposed projects. E9: Dlstrict Plan � In evaluating proposals for capital projects, preferenc� shall be granted to projects which demonstrably contribute to fulfilling the objectives of relevant District Plans (as adopted by District Councils). � 18 � � Projects which demonstrably conflict with District Plans shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given � preference. E 10: Housing � In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably support the maintenance and upgrading of the city's existing sound housing stock, while seeking to � improve deficient housing and to generate construction of new, affordable housing choices in character with the neighborhoods surrounding them. Projects which demonstrably conflict with this � objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objective shall neither be penalized nor given preference. � EI1: Historic Preservation In evaluating proposals for capital projects, preference shall be � granted to projects which demonstrably contribute to historic preservation. Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or � indeterminate impact relative to this objective shall neither be penalized nor given preference. � EI2-E14: Policies Relating to G3: To ensure a supportive environment for businesses and jobs. � E 12: Business Development Strategy In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably support a systematic business � development strategy for an area which includas Saint Paul. Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this � objective shall neither be penalized nor given preference. E13: dob Creation , In evaluating proposals for capital projects, preference shall be granted to projects which demonstrably support the creation or retention of a substantial number of new jobs in Saint Paul or job � opportunities for Saint Paul residents. Projects which demonstrably conflict with this objective shall be penalized. Projects which have a neutral or indeterminate impact relative to this objcctive shall neither � be penalized nor given preference. E14: Business Investment � In evaluating proposals for capital pro,jects, pnference shall be granted to projects which demonstrably stimalste anbstantial n�w business investment in Saint Panl. ProXCts whieh demonstrably � conflict with this objective shall bc penaIiud. Projects which hav� a neutral or indeterminate impact relstive to this objective shall neither be penalized nor given preferenct. , 19 � � -------------------------------------------- � 3.2.2 FISCAL EVALUATION POLICIES E I5: Impact on Operating Bud�et � In evaluating the merits of each proposal: a. Projects which will result in a decrease in city operating and � maintenance expenses will be given special consideration. b. Projects which will result in an increase in city operating and � maintenance costs will be penalized. c. Projects which hav� a neutral or indeterminate impact relative to � this objective shall neither be penalized nor given preference. E16: Impact on City Revennes a. Projects that increase rcvenue to the city will be given special � consideration. b. Projects that rcduce revenua to the city will be penalized. � c. Projects which have a neutral or indeterminate impact relative to � this objective shall ncither be penalized nor givcn preference. E17: Grants The city shall actively seek grants from other units of government or � the private sector to finance projects which are consistent with adopted city plans and policies and the priorities of the city. Special consideration shall be given to capital improvement requests that will � be used as a match for such grants if the pro�ct dces not result in an increase in city operating and maintenance costs and if the project does not reduce revenue to the city. � E 18: Private Investment Capital improvement proposals that leverage committed private � investment will be given special consideration. Projects designed specifically as incentives to private development or redevelopment � should meet the following criteria: a. Levera�e Quidelines: Minimum leveraging is 1:6 (each public dollar should leverage at least 6 private dollars). This ratio may be as low as � 1:3 if the project: 1. is directly associated with neighborhood/city partnership � efforts; 2. creates permanent jobs for city residents; 3. is directly related to dev�iopment of tow and moderate income � housing; zo i � � 4. is directly related to conservation of nonrenewable energy resources or dcvelopment of energy alternatives; or 5. includes adequate space for a licensed child care center as � part of the project. b. Return on investment: A project associated with a numbered � exception to the leverage policy is subject to the following minimal return policies: � 1. The return in terms of tax revenues cannot be tess than the cost of additional services required by the project; and 2. Additional tax revenues generated from the project must be , sufficient to repay the city's investment over the lifetime of the asset provided. � E 19: Acquiaition In order to maintain its existing tax base, the city shall discourage the use of acquisition as a redevelopment tool. However, a project that � involves acquisition may be given the same priority as a project which does not if: � a. The acquisition is related to public development or reuse and: 1. Right-of-way of easements are necessary; � 2. The parcel(s) have been prcviously identified for conversion to park use if they become available; or � 3. The parcel(s) have tax eaempt status and a use which is consistent with city plans, policies and priorities has been clearly identified. � b. The acquisition is related to private developmont or reuse and: � 1. The proposed reuse is consistent with city plans, policies and priorities and: a) There is a reasonable expectation that development will � occur in the immediate future; or b) There is an economic advantage to the city to acquire � the property and the city can dispose of it within the reasonably foresceable future. � E20: doiat Use A facility that will be financed and operated by the city and another agency will be given special consideration if: � a. It is consistent with city plans, policies and priorities; ' b. It can be conatructed and operated more efficiently and efftctively at less cost than a separatc faciiity; , 21 � erati n an m in n , c. Op o d a te ance ex�enses for the facility w�ll be shared jointly by the city and the other agency; and d. It does not result in an increase in city operating or maintenance , costs or reduce revenue to the city. E21: Continuation Projects �, The funding needs of a capital improvement project that received a prior budget appropriation for construction plans or a construction � phase normally have priority over a new projeet or program allocation. Feasibility studies are not prior commitments. Acquisition and preliminary design do not constitute prior commitments unless � financing for construction plans has been approved and included in the CIB Committee's schedule of tentafive future commitments. Annual programs are not considered continuation projects. � E22. ProQrammlag and Phasing A proposed project should be adequately programmed and phased. � This means that: a: A proposal which is justified by city plans, policies and priorities � and is coordinated with other improvements at a cost saving to the city will be encouraged. b. A project must be timed with other improvements planned for the � area within the next five years. c. Only the amount which can reasonably be expected to be expended � in the budget year will be budgeted. Money required to complete the project will be identified in the schedule and will constitute a tentative commitment subject to City Council adoption of a budget � appropriation for each year of the project. E23: Use The eatent to which a project will be used will be taken into - � consideration. This means that: a. The greater number of people served by a project, the greater the � consideration that should be given to a project. Administrative units shall be considered separately from neighborhood facilities. b. Projects used year-round will be given greater consideration than � projects used primarily on a seasonal basis. E24: Consolidition of Facilities � A proposal which consolidates existing city facilities should be given � special consideration if ongoing operating and/or maintenance costs will be reduced. � � 22 � E25: Fi:c�l Impsct Analysis , Proposals which involve a new servicc or expanded level of service must include as part of the proposal an analysis of the impacts of the project on the city's operating costs and revenues. , -------------------------------------------- � 3.3 FINANCIAL POLICIES Financial Policies help the CIB Committee to determine what source of � financing should be used for particular projects. Numerous financing sources for capital projects are available to the city. However, many of them are earmarked to be used only for certain types of projects. By assigning the most narrowly targeted financing sources to the best projects, the CIB � Committee is able to recommend financing of the optimal package of projects. � F1: Financing Sources Determination of which financing source is most appropriate for each of the city's capital improvement budget priorities will be made as � follows: a. Recommended capital improvements which are subject to � assessment will be so assessed under the city's Special Assessment Policy. The policies currently in effect were adopted on December 23, 1976 as Council File No. 268302 and amended June 17, 1980 by � Council File No. 275110; May 17, 1984 by Council File No. 84-632; and February 11, 1986 by Council File No. 86-162. b. Recommended capital improvements located on Municipal State � Aid, County Aid or Minnesota Trunk Highway routes and eligible for one or more of these financing sources will be financed to the extent allowable with money allocated to the city specifically for these � routes. c. Recommended capital improvements which are eligible for metropolitan, state or federal programs or private grants should be so � financed. If appropriate, CDBG or CIB money may be used to provide local matching funds. � d. Recommended capital improvements which can be financed with specific bonding authority may be so recommended if City Council has indicated its intention to use such authority. Recommended � capital improvements which can be financed with revenue bonds or revenue from an existing Tax Increment District should be so f inanced. � e. Recommended capital improvements or portions thereof and programs eligible for CDBG financing should be so financed. � f. Recommended capital improvements which cannot be financed with money governed by paragraphs (a) throngh (e) will be considered for Capital Improvement Bond Financiag. , 23 � � F2: Community Development Biock Griat (CDBG) Program , Projects proposed for financing through the CDBG Program must � meet the federal guidelines issued by the U.S. Department of Housing and Urban Development. This means that: a. Projects must be included in the list of eligible activities contained � in the federal regulations. b. Projects must either principally benefit low and moderate income � persons, eliminate slums and blight, or meet a community need having a particular urgency. c. Of the total CDBG dollars which are allocated to projects, most � should principally benefit low and moderate income persons or be located in areas which meet the Department of Housing and Urban � Development's definition of low and moderate income. The remainder of the money may address slums and blight or community needs having a particular urgency. F3: Bond Financing � a. The Joint Debt Advisory Com�ittee recommendations allow the � sale of up to 513,700,000 in Capital Improvement Bonds in 1990 and a 14,500,000 in 1991. b. Thc city will issue up to �4,000,000 per year in special streot � assessment revenue bonds to finance 1990-1991 street paving work to be paid by benefitted property owners. The exact amount of boading will be determined by the specific projects scheduled and will be � contingent on the amount of federal, state and city construction moncy available for sewer separation. c. The city may issue up to �7,910,000 in 1990 and a5,170,000 in 1991 � in MSA project bonds. d. The use of revenue bonds to finance public improvement � commitments for econamic development projects is preferred over other financing sources. The city may consider using tax increment, taxable bonds, or tax-eaempt revenue bonds in 1990 or 1991 for the � following projects: 1. Riverfront development; 2. Downtown parking proposals; � 3. Other project-specific public redevelopment costs which � leverage significant private investment or investment by the State of Minnesota. Such bond issues may be general obligation bonds if there is a � dedicated revenue source to cover the interest and principle payments and if there is backup financingother than property tax revenues to cover the debt service. ' � 24 � F4: Tax Iecrcoent Finsncin� �'�� G�� a. Revenue projections by consultant: revenue projections for all tax increment proposals should be analyzed by an outside financial � consultant rather than a bond consultant. b. Debt service from bond sale proceeds: debt service for all tax � increment projects will be paid from bond proceeds for no more than the first three years of project implementation when no tax increments or other project revenues are generated. � c. Other costs funded from bond sale proceeds: all costs relating to any tax increment proposal should be funded with bond proceeds and included in the justification of each proposal. These costs include, � but are not limited to: design, acquisition and relocation, construction, bond consultant fees, bond counsel fees, financial consultant fees and staff time. � F5: HRA General Fund. The HRA General Fund. will be used for redevelopment of blighted � areas as designated in city plans. Projects funded through the HRA General Fund must be physical improvements which will rtsult in the revitalization of thc community. � The use of the HRA General Fund is governed by the state municipal housing and redevelopment law (Minn. Statutes, Chapter 462). Uses of the fund include acquisition, clearance, relocation, rehabilitation and � public improvements. F6: HRA Development Fund � Like the HRA General Fund, the purpose of the HRA Development Fund is to redevelop blighted areas as designated in city plans. � Projects funded through the HRA Development Fund must be physical improvements which will result in the revitalization of the community. However, at least 5096 of the HRA Development Fund must be used for redevelopment activities within the boundaries of � the 7th Place Redevelopment Area and Tax Increment District (roughly bounded by St. Peter and Market St. to the west, 11 th St. and 9th St. to th� north, Robert St. and Jackson St. to the east, and Sth St. � and 4th St. to the south). • The HRA Development Fund was established in 1983 ia the resolution � authorizing the sale/leaseback of the Civic Center (HRA Resolution 83-10/13-2). Like the HRA General Fund, it is used for acquisition, clearance, relocation, rehabilitation, public improvements, and project loans. � F7: Reh�bilitation Lo�n Funds � City bond money used to provide residential and commercial rehabilitation loans shall be reeycled for additional loans as the original loans ar� repaid accordiag to the guidelin�s adopted by the Saint Paul City Council. CDBG money used to provide residential and � � 25 � _ . .. commercial rehabilitation loans, which return to the CDBG program � as program income, shall be appropriated from the program income line item to provide aew loans as the original loans are repaid. � F8: Sale/Leaseback Before any sale/leaseback agreements will be approved by City � Council resolution, the following conditions must be met: a. The feasibility of the proposal must be analyzed by an independent � fiscal consultant chosen by the city. Costs for such analysis must be borne by the initiator of the project if other than a city agency. b. The advice of the Long Range Capital Improvement Budget � Committee must be obtained. c. If the repurchase of the facility is part of the proposal, the package � should be structured to minimize repurchase costs and financing must be feasible. F9: UDAG Reinvestment � As indicated by City Council Resolution No. 279820 (dated February � 8, 1983) all Urban Development Action Grant (UDAG) program income, shall be distributed as follows: Fifty percent of the program income from an individual UDAG shall be set aside for eligible projects within the district(s) in which the UDAG is located. The � remaining fifty percent of thc program income shall be deposited in the citywide UDAG Revolving Loan Fund to be used for economic development purposes. UDAG program income is that percentage of � any income earned by the city from the disposition of property acquired with UDAG money, the repayment of any loans made with UDAG money, or any other revenues defined by the grant agreement � as program income. All UDAG program income is administered according to HUD guidelines (Uniform Administrative Requirements for Grants and � Aids to State and Local Governments). In accordance with these guidelines, proposals for re-use of program income are reviewed by •the HRA Board and administered by HRA staff. � F10: Tax Abatement Th� city will not consider tax abatement as a development/ � redevelopment tool unless so determined by the Mayor, and by City Council resolution, and with the exception of tax abatement assistance for low income rental housing development. (Council File Na � 276807). F11: Multi-Year Projectton of Capitat Ftnanctng Sources Appendix F is a projection of all capital improvement financin � 8 sources for the years 1990 through 1994. The five-year tentative program included in the biennial capital budget shall not eaceed these � funding projections. � 26 � � 4.0 FUTURE DIRECTIONS FOR THE CAPITAL IMPROVEMENT BUDGETING PROCESS ' -------------------------------------------- The process of restructuring and improving the city's capital improvement � budgeting process will require many deliberate actions yielding incremental but significant reforms. Some actions have already been incorporated into the 1990-1994 CAP; others should be performed in the near future; still � others require a long-term time horizon. � ----------------- 4.1 SHORT-TERM ACTIONS (1988-1989) The most important short-term actions involving the CAP are those which � will ensure that processes which are already underway will harmonize with new capital budgeting procedures. The following three actions are recommended as top short-term priorities: . � A 1: Recategorizing Capital Functions � Action: The Planning Commission and the CIB Committee should study alternative ways of categorizing capital functions to determine if the current system of eleven functions is most appropriate. � Discussion: The current classification system is dated and in some cases does not correspond with budget management and accounting systems that are evolving in the city. For example, some city officials argue that a single "city buildings" capital function {for all � city-owned buildings) would be more appropriate in light of the city's new computerized building management system. Also, some argue that some rolling stock should be eligible for capital budget financing. � The recommended study should be a top priority because classification categories are fundamental to all other refinements of the capital budgeting process. � A2: Capital Function Strategies for the Program for Capital Improvements � Action: City departments and the Planning Commission should revise the Capital Function Strategies for the Program for Capital Improvements to reflect the priorities delineated in the Strategic Goals for the 1990-1994 CAP. , Discussion: The Planning Commission and the CIB Committee have recommended that Capital Function Strategies be integrated with the � city's Strategic Goals. In this way, it is hoped, capital planning on the part of city departments will become more focused strategically. Now that new Strategic Goals have been developed, city departments should begin working with the Planning Commission to reshape the , Capital Function Strategy statements to reflect these goals. The Planning Commission should also work to determine priorities among the city's capital functions. These actions should bo completed in time , for inclusion in the 1990-1994 Program for Capital Improvements. � 27 � A3: Capitat Functions and the Comprehensi�e Plaa � Action: The Planning Commission should consider how revisions in � the Comprehensive Plan can better aid the capitai improvement budgeting process. Discussion: The city has initiated a process to revise three key � elements of the Comprehensive Plan--the Land Use Plan, the Economic Development Strategy and the Housing Plan. Within this process, Economic Development and Housing should be considered as � capital fnnctions and their relationships with the Land Use Plan and with the capital budgeting system should be thoroughly explored. The lessons learned from this process should then be applied to planning � for other capital functions. 4.2 LONG-TERM ACTIONS (1990 AND BEYOND) _____-____- r When the joint Planning Commission/CIB Evaluation Task Force studied the � past performance of the city's capital improvement budgeting process, one of its major concern was that too much overprogramming was occurring in the PCI. Instead of providing a realistic multi-year estimate of future capital � projects, the PCI was recording all departmental needs, even though the cost of those needs far exceeded available city resources. A major reason for changing the process was to establish the two-year capital � budget as a disciplined foundation for the ten-year PCI that will be developed immediately thereafter. By recommending that years 3-5 of the next PCI realistically reflect expected financial resources, the task force � further emphasized the need for the city to prioritize strategically as part of its capital programming process, not just at the time when the capital improvement budget is adopted. A corollary of the modified process is that the CAP must become a more � effective guide to prioritizing projects. Although steps have been taken in the 1990-1994 CAP to move toward this goal, some of the task force � recommendations require studies and actions which must be deferred until later. In particular, the following actions should be pursued in 1990 or thereafter: � A4: City Plan Etements and Departmental Needs Assessment Procedures Action: The Planning Commission should consider adopting the goal � that all capital functions will be addressed in an element of the city's Comprehensive Plan. The plan element would establish policies which � prioritize types of projects within the relevant capital function and could establish a needs-assessment system to aid in prioritizing future proposed prajects. , Discussion: The responsibility for creating Capital Function Strategies is shared by the Planning Commission and city administrative departments. On the one hand, the Planning Commission and CIB � Committee have stated that the Planning Commission should generate these statements to reflect citywide priorities. In thcory, the Plsnning Commission should establish the capital function priorities which city � 28 � �� J�/� ' departments will then implement. In thc past, however, the Planning Commission has rclied significantly on city departments to formulate Capital Function Strategies. � Up to a point, this reliance is justified. City departments are committed to serving the public interest and are uniquely qualified to determine what are city needs that can be fulfilled by particular � capital functions. However, individual departments are not as qualified as the Planning Commission to determine how all capital functions should interrelate to fulfill different types of city needs. � The proposed action is intended to reconcile the tension between the neerl for departmental autonomy and the need for citywide � ac. :�ntab�d;ty in the capital planning and programming process. City departments should use their expertise to identify problems that their capital functions can help to solve. The Planning Commission will better be able to accept tfie departmental judgment if it can test that � judgment against a relevant city plan element and an agreed-upon system for assessing needs. � It would take several years for such procedures to be adopted and fully implemented. The process should begin with a Planning Commission study and evaluation of the way in which �xisting plan elcments deal with capital functions and the way in which � departments assess capital function needs. The study should also consider the status of city plans for capital functions which have been adopted by the City Council without Planning Commisaion � supervision, review or approval. Finally, the study should lead to a recommendation concerning what should be the Planning Commission's role in capital function plan making and needs � assessment. A5: Past Expenditures by Cap�tal Function � Action: The Planning Commission should analyze past expenditures by capital function, and assess whether and to what extent previous expenditures have fulfilled Strategic Goals of the city. (Specifically � recommended by the Planning Commission/CIB Committee task force.) � Discussion: This recommendation is intcnded to hclp the Planaing Commission establish spending priorities and incorporate them into Capital Function Strategies. � A6: District Strategies for Capitat Improvements Action: The Planning Commission should consider establishing � uniform procedures which would enable District Conncils to incorporate capital planning and programming into District Plans. � Discussion: The recommendation to consider encouraging District Councils to do capital programming arises from the Strateaie Goal of improving neighborhood management capabilities. To ensnre s#nility controt in this process, it would be important to establish uai�'#�m , criteria for what constitutes an acceptable District atrategy for es�iqtl improvements, and to provide training to Districts whlc6 choo�c to develop such a strategy. � 29 � � A7: Connection Betweea tLe Capital aad Operatin� Bed�ets Action: City planning and budget staff should analyze the interaction � between the capital and operating budgets. Based on this analysis, the Planning Commission and CIB Committee should provide more � comprehensive evaluation criteria for capital projects regarding their impact on the operating budget. (Specifically recommended by the Planning Commission/CIB Committee task force.) Discussion: Currently, capital projects resulting in a decrease in city � operating and maintenance expenses are given special preference in the capital budget review, while projects resulting in an increase in � city operating and maintenance costs are penalized. However, there are many unanswered questions regarding the interaction between the two budgets, and more extensive review criteria may be needed to � provide better direction on this issue. A8: Capital Investment for Social Services Action: The Planning Commission should study ways to improve the � CAP's ability to function as a decision framework for meeting social service needs in Saint Paul. However, this study should not be done � in isolation from a study of the larger issue of the rightful responsibility of the city for the social ne�ds of its citizens relative to the responsibility of other governmental units. Discussion: Some city administrators have commented that the current ' CAP does not adequately function as a decision framework for the city to address social service needs. Because some capital investment � is related to social service needs, it would be appropriate to improve the CAP in this respect. However, because the issues relating to social service provision extend far beyond questions of capital allocation, � any substantive revision of the CAP should be part of a broader policy making effort. � � � � � ' � 30 � , � S.0 DEFINITIONS , Capital Expenditure A one time expense required to upgrade or add to the physical assets (land and buildings) of the city. In addition, capital expenditures include incentives to the private sector to develop or re-develop � assets not owned by the city. Capital Improvement Budget - The annual capital improvement budget shall include � _propriations for all projects to be funded during the budget year � which have an estimated useful life in excess of three years, other than the acquisition of office or mechanical equipment, vehicles or mobile equipment, and minor remodeling or repairs of existing structures. The annual capital , - improvement budget shall include the proceeds of general obligation or revenue bonds of the city authorized by law, all aids, grants, and special revenues received by the city for funding capital�improvements, all monies • appropriated by the City Council in the General Fund and Special Fund � budgets for capital projects, and all special financing methods such as tax increment financing, long-term lease agreem�nts, and sale-leaseback financing. A five year program which identifies the future costs associated � with multi-year capital projects and any additional capital projects that are scheduled for implementation during the time of the program shall accompany each annual capital improvement budget. , Eatraordinary Capital Maintenance - The replacement, renovation, remodeling and/or retrofitting of the structural parts and/or service system components of a building, and the man-made components of an improved � site. Structural parts include footings and foundations; beams, joists, columns; load bearing walls, exterior walls and facade (excluding glass); stairs, floors, decks, ramps, ceilings; roofs and roofing. Service system � components include plumbing, electrical, communications, heating, ventilating, air conditioning, security systems and elevators; utility mains. Site components include retaining walls, lighting, stairs, ramps, sidewalks, � railings, fencing, drainage structures, and crosion control. For maintenance purposes, the most important site components are those whose condition affects the identified structural parts or service system components. � Operating Budget - The annual operating budget is a 12-month financial plan which provides for delivery of city services; support and planning for service delivery; routine maintenance; minor remodeling and repairs of existing � structures; acquisition of vehicles, mobile, mechanical, and office equipment; and other activities having an estimated useful life of less than three years. Primary financing sources for the operating budget are property taxes, � federal and state aids, dedicated revennes, user charges, and grants. Program Allocation - A program allocation is a lump sum amount given to fund a series of capital projeeta which are consistent in nature and are � implemented sequentially in time until an ideatified objective is reached. Aa example of a program allocation is the combined street and sewer program. r , � 31 � Subsidy Allocation - A subsidy allocation is assistance that the city gives to � the private scctor as incentive for dovelopment or redevelopment of physical assets now owned or operated by the city. Subsidy allocations include loans, � grants, matching funds, or acquisition and clearance. Tentative Program of Commitments - A section of the Capital Improvement Budget which estimates future annual appropriations needed to complete , projects which have been initiated. � i 1 1 1 ! � 1 � 1 1 1 . 1 r � 32 � ' � APPENDIX A CITY OF SAINT PAUL MISSION STATEMENT , (FROM THE "CITY OF SAINT PAUL 1989 BUDGET GOALS AND POLICIES") a Ensure the provision of high quality services, which meet the peo le's P priority need: and whi�h enhance the long term common good of the , community within the constraints of available financing sources and reasonable taxing policies. ' City services must: produce effective results; � be delivered efficiently, in a manner which is both timely and courteous; , be in conformance with applicable laws; and � be delivered within the context of high moral and ethical values. � Service delivery priorities include those which provide public safety, health and general welfare. Those services which strengthen all the neighborhoods as places to live, work, play, be educated and raise families are of particular � importance. City employees who are the agents for delivering quality services and for � ensuring the successful attainment of established goals, shall be treated with respect and fairly rewarded for successful job performance. � ' � ' � ' � 33 � , APPENDIX B � ELEMENTS OF SAINT PAUL'S COMPREHENSIVE PLAN , -------------------------------------------- GENERALELEMENTS o Overview of the Plan � o A Plan for Land Use o The Implementation Strategy � -------------------------------------------- ' CAPITAL FUNCTION PLANS o A Plan for Housing . o Housing Implementation Program � o A Plan for Streets and Highways o A Plan for Bicycles o Comprehensive Sewer Plan ' o Economic Development Strategy o A Plan for Parks and Recreation o A Plan for Libraries o A Plan for Multi-Service Centers � o Program for Capital Improvements (1988-1992) DISTRICT PLANS -------------------------------- � o District 1 Plan � o District 2 Plan o District 3 Plan o District 4 Plan � o District S Plan o District 6 Plan o District 6 Land Use Amendment � o District 7 Plan o District 7 Plan Update o District 8 Plan o District 9 Plan � o District 10 Plan o District 11 Plan o YOUniversity Avenue Plan (District 11 & 13) ' o District 12 Plan o District 13 Plan o District 14 Plan � o Grand Avenue West Parking and Zoning Report (District 14) o Grand Avenue Design Guidelines Amendment (District 14 & 16) o District 1 S Plan o Highland Village Plan Amendment (District 1 S) ' o District 16 Plan o Grand Avenue East Design Guidelines Amendment (District 16) o Dowatown Development Plan (District 17) , 34 � ' o Downtown Development Plan--Miller Hospital Site Land Use Amendment (District 17) o Status of District Plans as Part of Comprehensive Plan � -------------------------------------------- SUB-AREA PLANS , o River Corridor Plan o Downtown Framework � o Summit Avenue Plan o Lower Cathedral Hill Plan � � � ' � � , r r � � � � , 35 i , APPENDIX C � OVERALL BUDGET GOALS (FROM THE "CITY OF SAINT PAUL , 1989 BUDGET GOALS AND POLICIES") -------------------------------------------- � GENERAL BUDGET GOALS GG1 Maintain the fiscal integrity of the City's operating, debt service and ' capital improvement budgets in order to provide services and to construct and maintain public facilities, streets and utilities. GG2 Maintain a responsible and prudent fiscal condition and high bond � rating in order to minimize long-term interest expense when financing capital improvements with an ongoing systematic bonding program which spreads the cost of the improvements to benefitting citizens. � GG3 Prepare and annually refine written goals and policies to guide the preparation of financing, spending and performance plans for the ' City budget. GG4 Coordinate decision making for the capital improvements budget with the operating budget to make effective use of the City's limited � resources for operating and maintaining faciliti�s. GGS Present budget data to City managers and elected officials in a form � that will facilitate annual budget decisions based on a multi-year strategic planning perspective. GG6 Prepare and evaluate activity performance plans that relate to , financing and spending plans in the annual City budget. GG7 Encourage citizen involvement in the annual budget decision-making � process through public hearings and informal meetings. GG8 Implement the "Revenue Center Concept" for fleaible, business-like � management of budgets for Responsive Services: where a fund manager is responsible for the execution of program spending, financing and performance decisions, based on the law of supply and demand, and within program parameters determined by City Council. ' SERVICE LEVEL GOALS -------------- � SGI Budget decisions to increase a service level or add a new program will � be financed with eithor a new revenne source or tax increase, or by a deliberate reduetion in, or elimination of existing xrvices. Base decisions to reduce service levels or eliminate programs on , citywide priorities and needs if revenne sonrces are inadequate to maintain existing services at current program Ievels. ' 36 ' � � _%9��' ' Maintain programming fleaibility to address priority user needs based on historical usage and demographic trends within service areas if a , service is providod at many facilitios throughout the city and a service level reduction is necessary. SG2 Incorporate self reliance in both the day to day operations of the city , and the development of its long range plans. A self reliant city makes greater use of its own resources, takes care of its own and creates its own opportunities for a better life. More specifically, "Self Reliance" � should: o involve and engage everyone, � o foster economic development in neighborhoods and downtown to expand the tax base �and retain and create jobs, especially for the dislocated works and the disadvantaged, � o strengthen our neighborhoods through service delivery and cooperatiqn with neighborhood groups, � o strengthen City government as an organization dedicated to serving the people of Saint Paul. ' SG3 Avoid duplication of services with other units of government. Seek joint use opportunities for public facilities with both governmental units and non-profit organizations when effective service delivery � can be provided at less cost or no cost to the City. SG4 Recognize that City employees are City government's most valuable � assets, and, as such, their concerns, participation, and morale are crucial to delivering high quality, efficient services to the residents and taxpayers of Saint Paul. , SGS Employ good management practices when planning for service delivery by including in budget requests money to pursue activities, such as: � o office automation and computer applications that increase productivity; � o equipment modernization; o work-flow simplification; , o risk management/employee safety; , o preventive maintenance; o energy conservation; ' o life cycle costing and purchasing of equipment; o lease-purchase options for high cost equipment purchases which ' reduce operating eapenses; o performance plaaning, reporting and evaluation; , 3� ' o employee training; r o employee well being; ' o employee child care; and o competitive bidding for certain services. ' SG6 Modernize the physical and organizational structure of City � departments and offices to facilitate better management of resources. Create an environment which encourages innovative problem solving and pursuit of opportunities to improve service delivery within existing budgets. � SG7 Provide adequate budget resources to address the long-term program needs for essential human service delivery coordination, better � neighborhoods and economic development. � � : ' � ' ' � , � ' , , 38 � ' , APPENDIX D CAPITAL FUNCTION STRATEGIES ' -------------------------------------------- CFS1 STREETS ! The Department of Public Works has established a street condition analysis system and has surveyed all of the arterial streets. Every two years these � streets will be surveyed with the data entered into a computer. The condition of these streets will be monitored so that rehabilitatioa will be scheduled before complete failure of the street. This will save the city money because rehabilitation is much less expensive than total , reconstruction. - All residential oiled streets are scheduled to be paved between 1986 and 2006. , The first 10 years of this�will be in conjunction with the 10-year sewer separation program. Trees continue to be an important priority in street reconstruction. Funds ' for boulevard tree planting may be included in project proposals. Depending on the type of street project, the funding source for boulevard trees may vary: � 1) Reconstruction Projects. Reconstruction proposals may include an estimate for tree planting on the boulevard. Because MSA dollars can only be used to replace trees removed during reconstruction, Public � Improvement Aid or Capital Improvement Bonds may be the proposed financing source for additional tree planting. Residential street paving proposals may also include boulevard tree planting. , 2) Overlay Projects. Tree planting for street overlay projects may be financed as part of the street overlay proposal or may be financed , through the Citywide Tree Planting Program. Sidewalk repair should be based upon the city's liability exposure. Lawsuits, complaints, and the sidewalk condition survey should all be considered in � determining which sidewalks are repaired. This work should not be assessed. This would eliminate the cost of time, paperwork, and temporary patching, and result in a quicker permanent repair. , New sidewalks should be included when reconstructing collector or arterial streets where technically feasible. The current assessment policies should be ' continued. - ' ------------- CFS2 STREET LIGHTING The primary strategy of the street lighting section of the Department of ' Public Works is to improve the quality of street lighting through the installation of street lighting systems in coordination with street paving projects (or on an as-needed basis on Northern States Power-owned wood , poles) and to preserve or improve the quality of the txisting infrastructure. 39 � , ------------------------ ' CFS3 TRAFFIC ENGINEERING The primary strategy for the traffic engineering section of the Department ' of Public Works is to maintain the infrastructure of the traffic signal and signing systems in the city. Project funds are dedicated to help improve the safe and efficient movement of traffic, both vehicular and pedestrian, through the city. T'his is accomplished by either doing small improvements � on our existing traffic signals or signing systems or by installing new traffic signals or signs on an as-needed basis. � � -------------------------------------------- CFS4 BRIDGES _ , The city's bridge program is committed to the replacement, renovation, repair and maintenance of all bridges and related structures, in order to protect the health and welfare of the public and the transportation system. ' The economic welfare of the city and neighborhoods depends on the bridge system that liaks our neighborhoods with other communities and serves as ' crossing for natural, as well as unnatural, barriers. The bridge program is developed through an annual bridge inspection and � inventory system for all bridges inside the city limits. The annual inspections, as required by law, are mad� of each structure, at which time thc condition of all members and bridge components are noted and rated. The deficiencies noted as minor repair are scheduled for repair by Bridge � Maintenance Forces. Repairs requiring extraordinary maintenance are scheduled for rehabilitation, repair, renovation or replacement based on the condition ratings of the structures. Any structures or members noted in ' critical condition must be repaired immediately or closed to the public if supporting members cannot tolerate live load loadings. Bridges are posted for load restrictions if any deficiencies cannot be readily corrected. All bridge projects scheduled for rehabilitation or replacement are ' programmed for Capital Improvements and funding is pursued through the Capital Allocation Policy and the Planning Districts. � -------------------------------------------- ' CFSS SEWERS The strategic goal for the Sewer Division of the Department of Public Works is to provide storm and sanitary sewer service. The highest priority for , capital project proposals is to complete the Sewer Separation Program as outlined in the Comprehensive Sewer Plan for the City of St. Paul - Part I. Stormwater Management Plan and as required in the current federal and , state pollution abatement permit (NPDES: Pin 0025470). The proposed capital projects will provide necded separate storm and sanitary sewers, will eliminate sewer backups into homes and businesses and will eliminate the bypassing of sewage to the river during heavy rainfalls. ' ' 40 ' ' ----- ---- -- — — ----------- --------- CFS6 PARHS AND OPEN SPACES ' The Division of Parks and Recreation's responsibility is to develop, operate, maintain and preserve a system of pubtic parks, open space areas, natural resources and recreation facilities, and to ensure provision of cultural and ' recreational opportunities for all segments of the population. The Division must therefore continue to upgrade and replace existing � facilities to maintain the Parks system infrastructure and build in the capability to respond to changing needs in the community. The Division's recently implemented needs assessment survey (July 1987) indicated that the Division should provi�:�� a greater diversity of programs and facilities ' appealing to all age groups, and the project proposals submitted to the C.I.B. process will reflect this need. ' -------------------------------- CFS7 LIBRARIES � During the next five years, the Division of Libraries will continue the renovation/repair work in its older buildings. By addressing these building needs, before they fall into a state of disrepair, they will be brought up to , code and will allow the delivery of library services in appealing, pleasaat, comfortable facilities for the residents of the communities. � Included in these building needs is the arrangement of th� library's collection of materials to facilitate the ease of access to these materials. This is true especially when addressing the Central L�brary where users must � move about a four story building. Replacement of any library building will be determined by 1) the existing facility's physical condition, 2) demonstrated usage patterns, and 3) level of , service needs. , -------------------------------------------- CFS8 POLICE The Police Department's capital strategy over the next several years will ' continue to center around our buildings. Specifically, the department will be looking to acquire a permanent Team Office site in thc western part of the city and also acquire the site now used by the East Team for the eastern half � of the city. This will give the department long-term stability in the decentralization of Police services to the neighborhoods of Saint Paul. ' ---------------------------- CFS9 FIRE AND SAFETY , The Fire Department's Strategy Statement includes projects that we believe will be coatained in the Fire DepartmenYs Master Plan whieh will be conducted in 1988-89. These projects may include the construction of an , administration building at the training site facility, expansion and renovation of existing fire stations, the purchase of addition real properties, ' 41 , and construction of new fire statioas. Those ste s ma be necessar becausc , P Y Y of consolidation of eaisting buildings and equipment, brought about by Master Plan recommendations and alternatives. ' The remaining facilities will be in need of improvements at the training facility, roof replacements, energy efficiency improvements, new heating, ' ventilation, and air conditioning systems. -------------------------------------------- � CFS10 MISCELLANEOUS CITYWIDE BUILDINGS (FACILITY MANAGEMENT SYSTEM) The focus on the next four years will be to record and analyze the costs in ' terms of labor, material, contract-out services and energy. The documentation will be performed via a city-wide computer work-order system. The success of obtaining meaningful data will necessitate the ' cooperation of all division/department facility managers on the system. The goal of the system is to better know what the city is spending to maintain its facilities. 'The system will also provide for the documentation of prevenfive � maintenance activities, an effort necessary if the city is to stretch its facility dollars. ____________________________________________ i CFS11 ECONOMIC DEVELOPMENT AND URBAN PRESERVATION Capital programming in the Department of Planning and Economic � Development is guided by the following objectives: 1) To maintain, improve and add to the city's existing housing stock; ! 2) To facilitate the growth and development of business and job opportunities in the neighborhoods and downtown; , 3) To ensure the best possible urban environment through well designed , physical improvements both in the neighborhoods and downtown. To fulfill the first objective, PED plans to continue and expand city , programs aimed at providing single family and rental housing rehabilitation through conventional and innovative financing mechanisms. PED also plans to continue to encourago neighborhood stability through the use of subsidies for low income families and affordable housing alternatives. ' The revitalization and expansion of neighborhood businesses can be assisted � through a variety of commercial strategies. PED plans to continue to ' encourage neighborhood commercial developm�nt throngh varied technical and financing assistance, includiag: costs associated with capital improvements, commercial rehabilitation, revolving loan programs and employment assistance through job creation and training sectian. , In order to promote economic developmeat in the central city, PED seeks to encouragc dcvelopment through s coordi�ated, well-balanced combination of ' physical improvements in the downtawn area and the riverfront. ' 42 ' � ' APPENDIX E ' PUBLIC IMPROVEMENT ASSESSMENT POLICY � -------------------------------------------- SIDEWALKS � New Construction Resi�ential, �'ommercial, Industrial (all property uses) ' 10096 of cost to be assessed with long side subsidy for residential properties to be the only exception. (Long side ' subsidy is defined later in this report.) Residential property on aid street - 5096 of cost assessed. � Reconstruction Commercial, Industrial, Mu1ti-Family, etc. ' 10096 of cost to be assessed. , Residential 5096 of costs for frontage to be assessed. (Long side aid applies to residential property.) , Subject to City Council Discretion: 10096 for all construction wider than S feet; 10096 of all additional costs ' for special treatment, surfaces, etc. When commercial type sidewalks are reconstructed or , constructed on commercial streets, residential properties located on these streets will be assessed at current residential rates. � -------------------------------------------- STREET GRADING AND PAVING ' LOCAL OR NEIGHBORHOOD STREETS New Constructioa , Residential, Commercial, Industrial (all property uses) ' 10096 of cost to be assessed. (Long side aid to be considered for residential properties , oaly.) ' 43 ' Reconstruction (when done as part of the city-wide street , improvement program such as the Combined Sewer Separation and Street Reconstruction Program) , Residential and Commercial 25% of total cost to be assessed (1986 rates were $21.00 per , assessable foot). ARTERIAL STREETS , New Construction Variable percentage of cost to be assessed taking into account ' the special benefits received by the abutting properties as well as the general benefit received by the city at large. Reconstruction , Arterial streets meeting certain criteria are to be reconstructed � with no assessments being levied against abutting properties. The criteria that must be satisf ied is: 1. The street must be a street eligible for and receive its ' major funding from either County Aid, Municipal State Aid, or other funding not originating in the City of Saint PauL ' 2. The street must be a street serving as an arterial street providiag capacity for through traffic and thus providing � a substantial benefit to the general public. EXTRAORDINARY MAINTENANCE � All extraordinary maintenance and ma jor repair items that, in the discretion of the Director of Public Works does not constitute reconstruction will be funded from the Street Maintenance Fund and ' will not be assessed to specific properties. Asphalt overlays are to be considered as extraordinary maintenance. , -------------------------------------------- SEWERS - SANITARY New Construction ' 1009b of cost to .be assessed, except for city aid because of long ' side subsidy or other design coastraints. Reconstruction ' Sewer repair and maintenance is eurrently financed through the sewer service fund and therefore not assessed. The Department of Public Works reports that there is no urgency in the ' foreseeable future for major raplacement of sanitary sewers. , 44 ' ' The Comprehensive Sewer Plan, adopted by the City Council recommends ultimately assessing 2596 of the costs of ma jor � reconstruction. , ----------------------------- SEWERS - STORM RELIEF (COMBINED SEWER SEPARATION PROGRAM) � New Construction Continue present policy of assessing a portion of the cost against ' nene#itted properties. Approximately 2096 of the cost for storm relief systems is recovered by assessment. The current rate is 3 cents per square foot for residential properties and 7 1/2 cents per square foot for commercial and industrial properties. This � rate is reviewed annually. - , ----- ORNAMENTAL STREET LIGHTING New Construction ' 10096 of cost to be assessed for all lighting construction costs associated either with the construction of an ornamental lighting � system or the upgrading of an existing wood pole system to an ornamental system, except when done in connection with a City Street Improvement Program such as the Combined Sewer , Separation and Street Reconstruction Program, in which case the assessment rate will be based on the following: Residential and Commercial , 2596 of total cost to be assessed. (1986 rates were a2.00 per assessable foot.) � -------------------------------------------- , ALLEY - GRADING AND PAVING New Construction and Reconstruction � 10096 of cost to be assessed against benefitted properties. , -------------------------------------------- CURB AND GUTTER New Construction and Reconstruction � 10096 of cost to be assessed against benefitted properties when constructed on a separate basis. Long side aid applies to ' residential properties. When the entire street is being reconstructed, curbs and gutters are included in the ovcrall paving cost. , 45 ' ' -------------------------------------------- LOCAL DRAINAGE PROBLEMS New Construction and Reconstruction ' 100°r6 of cost to be assessed against benefitted properties. ' -------------------------------------------- , WATER MAINS New Construction 100�6 of cost to be assessed against benefitted properties. , Reconstruction � Variable percentage of cost to be assessed taking into account the special benefits received by the abutting properties. An example would be the need to increase the size of a street main ' to provide more water for fiie protection. UTILITY SERVICE CONNECTIONS ------------------- ' The utility service connection referred to in this report is that portion of the ' service connection running from the street main to the property line. The portion running from the property line to the building is the exclusive responsibility of the property owner. ' New Construction 10096 of cost to be assessed against benefitted properties. ' Replacement The cost for replacing water or sewer service connections to be ' the responsibility of the affected property owner. ' -------------------------------------------- LONG SIDE SUBSIDY FORMULA � RESIDENTIAL PROPERTIES New Construction and Reconstruction of Surface Improvements ' (street, grading, sidewalk, ete.) Use full narrow street frontage plus 5096 of the long side � frontage. New Construction and Reconstruction of Underground Improvements (sewers, water mains} , Use full narrow frontage, plus 10 feet for the first 125 feet of long side frontage plus full frontage for depths beyond 125 fcet. ' 46 ' �,� i>f�' ICOMI�gRCIAL PROPERTIES ' New Construction and Reconstruction of Surfacc Improvements Use full narrow frontage plus full long side frontage. , (No long side subsidy.) New Construction and Reconstruction of Underground Improvements ' Use full narrow frontage, plus 10 feet for the first 100 feet of long side frontage plus full frontage for depths beyond 100 feet. � ' , 1 , , , , , , ' ' ' , 47 , , APPENDIX F ' ESTIMATED FINANCING SOURCES FOR SAINT PAUL CAPITAL IMPROVEMENTS: 1990-1994 ' ' ' 1990 1991 1992 1993 1994 ----------- ----------- ----------- ----------- ----------- , Assessments 379,000 390,000 355,000 375,000 400,000 4 Pubtic Improvement Aid 877,000 903,500 930,500 958,500 987,000 ' Sewer Availability Charges 500,000 5�,000 500,000 500,000 500,000 Sewer Service Fund 850,000 850,000 850,000 850,000 850,000 Sewer Service Fund Reserve 6,800,�0 6,800,000 6,800,000 6,800,000 6,800,000 , S�wisry Abatement Fund 1,500 1,500 1,500 1,500 1,500 Yater Utitity: Surchar9e 650,000 650,000 650,000 650,000 650,000 Ca�nity Developnent Block Grant 4,000,000 4,�,000 4,000,000 4,000,000 4,000,000 Co�e�nity Oevelopment Grant Prograin Income 325,000 325,�0 325,000 325,000 325,000 ' County Aid 780,000 780,000 780,000 780,000 T80,000 Fcdersl Aid Urban 8,100,000 1,542,295 457,T05 0 0 Metrapolitan Parks 8 Open Space Grants 1,824,000 0 1,000,000 0 0 ' Mimesota Department of Transportation 0 0 0 0 0 Mimesota Water Potlution Control Grants 8,533,300 8,639,208 8,778,761 8,910,442 9,044,099 M�nicipal State Aid 5,737,500 5,850,000 5,969,295 6,088,681 6,210,i55 Tr�lc Nighway Funding 455 000 6T3 000 492 000 511 680 532 1i7 ' . , , , � ----------- ----------- ----------- ----------- ----------- SUBTOTAL: NON-BONDING REVENUE 39,812,300 31,704,503 31,889,761 30,750,803 31,080,201 ----------- ----------- ----------- ----------- ----------- ' Capital Improvement Bonds 14,000,000 14,800,000 15,T00,000 16,600,000 17,000,000 ' Special Assessment Street Improvement eonds 2,871,450 2,871,450 2,871,450 2,871,450 2,871,650 Tax lncrement Bonds 2,049,800 30,700 0 0 0 Municipal State Aid Supported Bwids 7,708,400 5,168,005 0 0 ' ----------- ----------- ----------0 ----------- ----------- SI�TOTAI: GENERAI OBLIGATION DEBT 26,629,650 22,870,155 18,571,450 19,471,450 19,871,�i50 ----------- ----------- ----------- ----------- ----------- ' TOTAt ESTIMATED FINAMCING bi,itf,f6i K,S7�,668 'SO,b61,211 50,222,253 5p,951,b51 ' """"'° e......... � � � , ' 48 '