City of Newfolden

CAPITAL IMPROVEMENT

PLAN

2007 - 2011

Adopted December 2006

The City of Newfolden is responsible for providing a variety of services to residents and businesses of Newfolden. The City Council has adopted the attached Capital Improvement Plan for the following reasons:

Plan for the maintenances of existing facilities and infrastructure;

Plan for expansion of existing and new facilities and infrastructure necessitated by the growth of the community;

Evaluate and prioritize future projects;

Provide efficient and enhanced public services;

Provide tools to aid in long range financial planning.

The following is a list of participants who assisted in the preparation of the 2007 – 2013 Capital Improvement Plan :

Newfolden Budget Committee:

Lori Warne, Councilmember

Darin Jacobson, Councilmember

City Staff:

Tammy Hansen, City Administrator

Jerome Nelson, Public Works/Maintenance

CAPITAL IMPROVEMENT PLANS

The City of Newfolden is utilizing capital improvement planning to ensure proper planning for governmental and business operations. A long range capital improvement plan is a valuable tool in providing necessary maintenance and replacement of assets used in providing a variety of services to residents and businesses of our community.

In 2003, the State Legislature approved new legislation. MN Statutes Section 475.521 (The CIP Act), states a City may issue bonds for specific capital improvements allowed by statute. Capital improvements mean acquisition or betterment of public lands, building, or other improvements for the purpose of a city hall, public safety facility, and public works facility. An improvement must have an expected useful life of five years or more to qualify. Capital Improvement does not includes light rail transit or any activity related to it, or a park, library, road, bridge, administrative building (other than a city hall), or land for any of these facilities.

In order to achieve the development goals of the City of Newfolden and to ensure normal business operation of the City’s Public Utilities and Enterprise Funds, it is necessary to establish a plan that extends 5 to 7 years beyond the annual budget. This plan will be utilized to inventory assets and infrastructure age and needs, and to identify and prioritize expenditures of public funds, assuring sound financial decisions are being made, and that the goals and objectives of the residents, businesses, and Council are achieved.

The 2007 – 2013 capital improvement plan includes capital projects and capital purchases for all governmental operations. A capital improvement:

  • Has an estimated cost of $1,000 or more (with the exception of land).
  • Has a useful life of five years or more, with the exception of certain equipment that may have a shorter life span

The capital improvement plan will also include planning for enterprise fund reserves. Preparing and protecting a reserve amount will serve as a revenue source for major repairs and maintenance needs not accounted for in the enterprise fund budget plan or the capital improvement plan.

Projected capital improvements will be reevaluated on an ongoing basis. The capital improvement plan will be reanalyzed, modified or amended, and adopted annually, as part of the budget process. This will ensure accurate assessment of revenue sources, capital needs, alliance with City goals, and sound financial decision-making.

The capital improvement plan is not intended to include typical maintenance items associated with streets, utilities, and administration, such as seal coating, crack sealing, repairs, or services. The capital improvement plan will address utilityinfrastructure and municipal facilities and equipment.

POTENTIAL REVENUE SOURCES

  1. Capital Improvement Fee / Fund
  2. Enterprise Fund(s)
  3. General Fund
  4. Special Assessments
  5. General Obligation Bonds**
  6. Lease Purchase Bonds
  7. Revenue Bonds
  8. Grants
  9. Donations

** Only public safety, public works facilities, and City Hall facilities may be financed with general obligation bonds under the CIP Act. Other capital improvements in this plan may be financed with special assessment bonds under MN Statute 429. Utility Revenue bonds under MN Statute 444, or any other types of bonds permissible under other laws.

EQUIPMENT / INFRASTRUCTURE INVENTORY

An inventory of existing equipment and facilities, reveal a need to prepare for the inevitability of aging and upgrading. The capital improvement plan will allow for the itemization of needs and an estimated timeline. Again, this will be reevaluated annually.

The capital improvement plan will attach a value and a potential revenue source to each projection.

EXISTING INVENTORY:

Facility / Equipment: / Year: / Age: / Notes:
City Pick-up truck / 1987 / 20 yrs
Pay-Loader / 1983 / 24 yrs / Snow removal
Dump Trucks (1) / 1972 / 25 yrs
(2) / 1974 / 23 yrs
Riding Lawn Mowers / 2000+ / 6 or 7 yrs / Purchase price - $5,000.00
Riding Mower/Snow Plow/ Grader / 2000+ / 6 or 7 yrs / Purchase price - $13,000.00
Boom Truck / 1973 / 24 yrs / Electric utility
Desktop Computer / 2004/05 / 2 to 3 yrs
Laptop Computer / 2006 / 1 yr
Laser Printer / 2006 / 1 yr
Printer/Copier/Fax / 2005 / 2 yrs
Streets and Sidewalks / 1996-99 / 8 to 10 yrs
Sewer Mains (1) / 1996-99 / 8 to 10 yrs / 10% with street improvements
(2) / 1972 / 25 yrs / 90% original
Water Mains / 1996-99 / 8 to 10 yrs
Water Tower (50,000 gallons) / 1954 / 52 yrs / Life - indefinite
Water Tower Patching/Relining / 1994 / 12 yrs / Life of coating 10 to 15 yrs
Water Tower Painting / 1994 / 13 yrs / Overcoat $18,000
Lagoon Wrip-Wrap / 1996 / 8 to 10 yrs
Street Lights / Overhead Wiring / 1940’s+ / 60 yrs + or -
Community Center/City Hall / 1978 / 29 yrs
City Shop / 1978 / 29 yrs
City Pole Shed / 1997-98 / 9 to 10 yrs
Fire Truck-International Pumper / 2000 / 7 yrs / Life – 30 yrs / Rotate new pumper every 15 yrs (new lease in 8 yrs)
Chevy Pumper Fire Truck / 1982 / 25 yrs
Van/Fire / 1981-82 / 25/26 yrs

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CIP / Department / Amount / 2007 / 2008 / 2009 / 1020 / 2011 / Revenue Sources/Addl. Notes
Public Works:
Pick-Up Truck / $8,000 / 1600 / 1600 / 1600 / 1600 / 1600 / Capital Improvement Fund
Dump Truck / Vehicle / $20,000 / 4000 / 4000 / 4000 / 4000 / 4000 / Capital Improvement Fund
Riding Lawn Mower / $5,000 / 1000 / 1000 / 1000 / 1000 / 1000 / Capital Improvement Fund
SUBTOTAL / $33,000 / 6600 / 6600 / 6600 / 6600 / 6600
Streets and Sidewalks:
Redo downtown sidewalks / $5,000 / 1000 / 1000 / 1000 / 1000 / 1000 / Capital Improvement fund
SUBTOTAL / $5,000 / 1000 / 1000 / 1000 / 1000 / 1000
Water:
Water Tower Patching/Reopxying / $10,000 / 2000 / 2000 / 2000 / 2000 / 2000 / Capital Improvement Fund
SUBTOTAL / $10,000 / 2000 / 2000 / 2000 / 2000 / 2000
Sewer:
Sewer Reserve / $5,000 / 1000 / 1000 / 1000 / 1000 / 1000 / Capital Improvement Fund
SUBTOTAL / $5,000 / 1000 / 1000 / 1000 / 1000 / 1000
Electric:
Decorative street lights/downtown* / $40,000 / 13334 / 13334 / 13334 / 0 / 0 / Elect. Fund, grants, fundraising
SUBTOTAL / $40,000 / 13334 / 13334 / 13334 / 0 / 0
City Buildings:
Administration:
Survey and Plat-New development / $10,000 / 2000 / 2000 / 2000 / 2000 / 2000 / Capital Improvement Fund
SUBTOTAL / $10,000 / 2000 / 2000 / 2000 / 2000 / 2000
Parks/Recreation:
New Picnic Shelter* / $15,000 / 15,000 / 0 / 0 / 0 / 0 / Grant/Park Fund
Camper pads/parking/ADA pathways* / $18,000 / 0 / 0 / 0 / 0 / 0 / Grants/Park Fund
Picnic tables/gbg receptacles/signage* / 0 / 18,000 / 0 / 0 / 0 / Grants/Park Fund
SUBTOTAL / $33,000 / 15,000 / 18,000 / 0 / 0 / 0
Fire/Public Safety
ATV-Polaris Ranger with Mattracks* / $20,000 / 4000 / 4000 / 4000 / 4000 / 4000 / Fire Fund/grant
SUBTOTAL / $20,000 / 4000 / 4000 / 4000 / 4000 / 4000
TOTAL / 156,000 / 31,200 / 31,200 / 31,200 / 31,200 / 31,200
TOTAL CI FUND AMOUNT: / 63,000 / 12,600 / 12,600 / 12,600 / 12,600 / 12,600

** Yellow highlighted rows indicate capital projects/equipment not included in the CI Fund sum.

LONG RANGE PLANNING / IDEAS

LEE’S ADDITION STREET PAVING – Special Assessments

UNDERGROUND BURIAL OF ELECTRIC-SYSTEMATIC-Electric Fund

COMPREHENSIVE PLANNING -Grant

RELINE/REDO SEWER – SYSTEMATIC

REOPXYING TANK WITH SAND BLAST - $18,000.00

COMMUNITY CENTER ADDITION – EXPANSION FOR FIRE DEPARTMENT, OFFICE SPACE

CAP SEWER LINES BY WESTAKERCHURCH

WATER TREATMENT FACILITY

REPLACEMENT OF DUMP TRUCKS / PAY-LOADER

NEW DEVELOPMENT INFRASTRUCTURE

CAPITAL IMPROVEMENT FEE – APPLIED MONTHLY PER ACCOUNT –BASED ON AVERAGE OF 200 ACCOUNTS
MONTHLY FEE / 2.00 / 2.50 / 3.00 / 3.25 / 3.50 / 3.75 / 4.00 / 4.25 / 4.50 / 4.75 / 5.00 / 5.25 / 5.50 / 5.75
ANNUAL TOTAL / 4,800 / 6,000 / 7,200 / 7,800 / 8,400 / 9,000 / 9,600 / 10,200 / 10,800 / 11,400 / 12,000 / 12,600 / 13,200 / 13,800
CAPITAL IMPROVEMENT FEE – APPLIED MONTHLY PER ACCOUNT –BASED ON AVERAGE OF 200 ACCOUNTS
MONTHLY FEE / 6.00 / 6.25 / 6.5 / 6.75 / 7.00 / 7.25 / 7.50 / 7.75 / 8.00 / 8.25 / 8.50 / 9.00 / 9.50 / 10.00
ANNUAL TOTAL / 14,400 / 15,000 / 15,600 / 16,200 / 16,800 / 17,400 / 18,000 / 18,600 / 19,200 / 19,800 / 20,400 / 21,600 / 22,800 / 24,000

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CAPITAL IMPROVEMENT NARRATIVE

Public Works

  1. The City pick-up truck, dump trucks, and riding lawn mowers are utilized routinely as a function ofmany areas of the Public Works / Water / Wastewater /Maintenance job description. Although these vehicles remain in good working order, each is nearing their respective life expectancies. We must prepare for the inevitability that they may need replacement within the next five years. Budgeting will include an estimate for a full-size, used 4-wheel drive, long box pick up truck.

Streets and Sidewalks

  1. Various areas of our sidewalks are in need of repair. Certain areas make traveling on the sidewalk difficult. It is important that we begin a plan to fund the repair needs of our sidewalk system as they reveal themselves. This will help control repair costs and facilitate a segmented process for ongoing needs and maintenance. Budgeting will include an estimate from local contractors for immediate necessary repairs; this information will be used to develop a plan for ongoing repairs.

Water

  1. The Newfolden water tower was most recently inspected in 2006. The inspection report estimated that the water tower will require patching / relining with apoxy inside the tower within the next 5 to 10 years. A total sandblast and tower relining with apoxy is estimated to cost $18,000.
  2. Residents have enjoyed low user fees regarding water, sewer, and electric utilities for many years. Most years did not reveal a cost of living or any other type of adjustment in user fees. In an effort, to keep expenses low, the enterprise fund reserves were used to cover additional expenses. As a result, the reserves are in dire need of replenishing. The budget committee takes great care in anticipating and planning for annual maintenance and service expenses as well as capital equipment and project needs. However, reality has shown us that not all needs and expenses can be predicted and a reserve must be built to accommodate the unexpected. Many enterprise funds adjust user fees (utility rates) to facilitate a reserve for such expenses. The Newfolden City Council has found it necessary to adjust user fees for the sole purpose of meeting annual service and maintenance expenses and creating a fund that is self-sustaining. The council has determined that rather than adjust fees further, the creation of a capital improvement fee/fund will accomplish the goal of providing a revenue source for capital improvement projects and will serve as an efficient method for tracking capital improvement revenues and expenses.

Sewer

  1. Sewer lines feeding the area north of WestakerLutheranChurch will need to be capped pending Minnesota Pollution Control inspections. Prior inspections revealed excessive amounts of surface water /inflow into the sanitary sewer system. Uncapped sewer lines contribute significantly to this problem. These sewer lines originally served a trailer court located in this area of Newfolden.
  1. Residents have enjoyed low user fees regarding water, sewer, and electric utilities for many years. Most years did not reveal a cost of living or any other type of adjustment. In an effort, to keep expenses low, the enterprise fund reserves were used to cover additional expenses. As a result, the reserves are in dire need of replenishing. The budget committee takes great care in anticipating and planning for annual maintenance and service expenses as well as capital equipment and project needs. However, reality has shown us that not all needs and expenses can be predicted and a reserve must be built to accommodate the unexpected. Many enterprise funds adjust user fees (utility rates) to facilitate a reserve for such expenses. The Newfolden City Council has found it necessary to adjust user fees for the sole purpose of meeting annual service and maintenance expenses and creating a fund that is self-sustaining. The council has determined that rather than adjust fees further, the creation of a capital improvement fee/fund will accomplish the goal of providing a revenue source for capital improvement projects and will serve as an efficient method for tracking capital improvement revenues and expenses.

Electric

  1. The electric utility is a self-sustaining enterprise fund. User fees are used to create a revenue source for capital improvements.
  2. Much of the Newfolden electrical system is dated back to the early 1940’s. The City Council has previously adopted a policy that facilitates the burying of underground electrical service as the need or opportunity presents itself. Rather than simply replacing the various street lights, the City will continue the process of eliminating overhead electrical lines. Considering the age of our service, it is prudent to consider a plan that incorporates the upgrading of electrical service with the function of community development initiatives. Recent surveys and resident comments have supported the idea of replacing downtown street lights with decorative street lights. This will serve two purposes:
  1. Upgrade the electrical service to that area, thereby, decreasing energy costs;
  2. Improve the appearance of the Newfolden business district.

The upgrading of the downtown district may require phasing over the course of three years. Future plans will include the segmented upgrading of community-wide light fixtures and electrical service.

Administration

  1. Economic development hinges on the ability of Newfolden to recruit new residents and businesses to the community. We currently have one lot available in Lee’s addition and a random few scattered throughout the community. Short term planning includes the development of .80 acres on East Third Street, already serviced by city water, sewer and electric. Two to three potential building sites may be available at this location. After this, there is an obvious decrease in the available resources for the development of new single family dwellings. The City is in a good position, in that is currently owns 12.08 acres of land just north of the Newfolden Elevator. However, this process must be part of a long range plan that includes an estimated $300,000 to $500,000 in infrastructure expenses. The first step in this planning must include a survey and plat of this development.

Parks and Recreation

  1. The NewfoldenCityPark is in the middle of a renovation project. Phase two and three of the project will be completed by summer of 2008. Revenue sources include a DNR grant which has committed to 50% of the project total. Other funds are being raised through other organizations, foundations, and private donors. The electric fund will serve as a revenue source for the wiring of the new picnic shelter and restroom facility and the burying of all electrical service. The park fund may be used to cover additional expenses.

Fire/Public Safety

  1. The Newfolden Fire Department serves a mostly rural, grassy terrain. A large percentage of the calls responded to are grass fires. The response of the firefighters is hindered by the ability to reach the location of the fire. An all-terrain vehicle will assist with ready access to rural, grass fires and other locations not easily accessible by the standard fire trucks. In addition, Newfolden serves as a site for first responders. An all-terrain vehicle may be of assistance when accidents or other injuries are not readily accessible by the ambulance service.

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