Transcript Document
Alternative Financing for City Streets Preservation Is the SMU Right for Your City? Presented By: Dennis Dowdy, PE Dick McKinley, MPA, PWLF Pablo Para, PE Ashley Probart, AICP Public Works Director, City of Auburn Public Works Director, City of Tacoma Traffic Engineer, City of Auburn Legislative & Policy Advocate, AWC Moderated by: Dan McReynolds, PE Principal, Parametrix Alternative Financing for City Streets Preservation Session Goals: – – – – Present the proposed Street Maintenance Utility (SMU) Option for financing street maintenance and operations. Compare and contrast the advantages & disadvantages of the Transportation Benefit District (TBD) Option vs. the SMU Option. Present a standard process and rate model for establishing an equitable SMU program. Determine which cities feel a need for legislative authorization for the SMU which is currently an AWC priority. Our Common Street System Goals Maintain a safe transportation system that: Provides efficient movement of goods and people Maintains and enhances our economic competitiveness Creates tangible return on investments for businesses and citizens Why a new funding source is needed…. 281 Cities and Towns in Washington State are currently responsible for 16,421 miles of streets. Motor Vehicle Fuel Tax (MVFT) Declining – Local General Fund Options (Sales Tax, Property Tax, Real Estate Excise Tax etc.) – The main source for local agency street maintenance has been diminishing over time due to inflationary pressures, increasing fuel costs and improved vehicle fuel efficiency. Declining general fund revenues and other city service needs have left most agencies unable to supplement declining MVFT revenue. Transportation Benefit District – Currently the only other viable option for local agencies to fund transportation needs has limitations and may not work for all cities. Transportation and Economic Development OR Transportation or Economic Development— Which Comes First? Does good transportation create economic development or does economic development drive the need for good transportation? It seems like a classic “chicken or egg” question. But the relationship between transportation and economic development is a more complicated matter – one does not necessarily come before the other. Transportation and economic growth are interrelated and interdependent. Transportation development and economic development go hand in hand. A good transportation system doesn’t guarantee economic development, but it can help create an environment that fosters economic growth. In turn, economic growth can create a need for increased transportation services. One thing’s for certain, transportation does have a constraining impact on economic development. Source: Ernest Perry, Ph.D., Missouri Department of Transportation, June 2004 What is a Street Maintenance Utility? The Street Maintenance Utility is a Utility. Fees are equitably assessed based on land use intensity, trip generation and heavy vehicle impact factors. Revenue goals are set by each agency based on need. Requires voter approval only for initial establishment. Revenue can be used for O&M and preservation of street system, including ADA. Allows rate reductions for low income, seniors and land uses implementing TDM strategies. Allows independent trip generation rate calculations. What is a Transportation Benefit District? Description – – – – – Financing options- Councilmanic – – Revenue option for funding transportation improvements Available to cities & counties (used by Des Moines, Edmonds, Lake Forest Park, Olympia, Prosser, Seattle, Shoreline, Snoqualmie and counting) Commercial vehicles are exempted from increased Vehicle License fees Project oriented, TBD automatically dissolves upon completion of defined projects Has several accountability measures Up to $20 motor vehicle licensing fee Voter approved up to $100 General obligation bonds Up to 1.5% of TBD assessed valuation Financing options – With voter approval (simple majority) – – – – – – Up to $100 motor vehicle licensing fee Up to .2% sales and use tax Property taxes in excess of one-percent limit (for one year period only) Fees or charges imposed on commercial construction or reconstruction Road tolls General obligation bonds Up to 5.0% of TBD assessed valuation Why SMU if we have the TBD? SMU Administered by existing city government structure Requires only one public vote. Most equitable distribution of burden based on traffic impacts of individual land use types. Rates can be set based on actual needs. Revenue is consistent and reliable based on system needs. Allows rate reductions for low income, seniors and land uses implementing TDM strategies Allows independent trip generation rate calculations TBD Creates a separate governmental entity to administer Can require ongoing public votes. Not equitable distribution since it exempts trucks in license fees and property taxes don’t represent traffic impacts. Revenue may not cover program need and is dependant on voter reauthorizations. Simpler assessment & collection process than a SMU. Less staff is generally required to establish & operate than a SMU. Establishing an SMU in your City or Town New state legislation is needed to authorize the SMU option. Once authorized, local agencies would generally need to do the following under the drafted legislation: – A public vote must be held approving an SMU. – Advisory Board is formed consisting of stakeholder representatives. – Define level of service goals and estimate costs for implementing the SMU. – Establish utility rates, assessment and collection procedures. SMU Rate Schedule Auburn’s Model City of Auburn Background Data – – – – – – 99 Centerline miles of Arterial/Collector Roads 115 Centerline miles of Local Residential Roads 91 Traffic Signals Population over 70,000 Over 27,000 residential units (SF, condo’s, apart., etc) Heavy freight and pass through traffic. Model Flexibility – – Based on existing Impact Fee Structure Auburns model is easily adapted for use by other agencies with minimal adjustments for local land use and traffic data. Making Auburn’s Model Work for your City Step 1: Data Collection – Land Use Data – Local Traffic Data – Residential (Dwelling Units) Non-residential (KSF) Heavy Vehicle Impact Factor (1450 in Auburn Model) based on WSDOT pavement manual. Average Trip Length (3 miles in Auburn Model) Program Burden Annual transportation system maintenance costs Residential APARTMENT CONDOMINIUM DUPLEX FOURPLEX LOW INCOME HOUSING MOBILE HOME SINGLE-FAMILY TOWNHOME TRIPLEX SENIOR HOUSING ASSISTED LIVING TOTAL 5962 2228 881 781 157 2527 13923 471 79 27 774 Commercial-Services TOTAL Commerical-Restaurant TOTAL FAST FOOD RESTAURANT 45 DINE IN RESTAURANT 49 COFFEE STAND Commercial-Retail/Shopping 17 TOTAL DRUG STORE 5 GROCERY STORE 10 AUTO SALES 37 RETAIL Commercial-Office 500 TOTAL MEDICAL OFFICE Industrial 74 TOTAL MANUFACTURING 82 HOTEL 6 WAREHOUSE 75 MOTEL 2 PUBLIC STORAGE DAY CARE 36 Unknown LIBRARY 1 UNKNOWN POST OFFICE 1 Commercial-Institutional GAS STATION 16 MINI MART 7 AUTO CARE 62 ELEMENTARY SCHOOL 4 4 1 COMMUNITY COLLEGE CAR WASH 5 NUSRING HOME AGRICULTURE 2 CHURCH CEMETARY 1 CHURCH WITH SCHOOL FIRE STATION 5 HOSPITAL MOVIE THEATER 2 FINANCE INSTUTIONS SHIPPING COMPANIES GOVERNMENT FACILITIES MUSEUM TRASNPORATION TELECOMUNICAITON 6 443 4 13 1 26 1 12 HIGH SCHOOL 5 SERVICE 1528 TOTAL MIDDLE SCHOOL HEALTH CLUB RECREATION 5 TOTAL 3 25 3 7 18 Making Auburn’s Model Work for your City (cont.) Step 2: Populate SMU spreadsheet and sort into groups by Total Impact Score – Policy Questions: How Many Rate Groups per category? What is burden distribution between Residential and NonResidential Categories? Step 3: Calculate your SMU Rates SMU Land Use Categories Non-Residential Non-Residential Level I Nursing Home Assisted Living Espresso Stand Self Service Car Wash Church Day Care Center Automated Car Wash Junior/Community College Hospital Non-Residential Level II Library Motel Hotel Elementary School General Office Non-Residential Level III Auto Care Center Free Standing Discount Store Furniture Store Specialty Retail Center Hardware/Paint Store Middle/Jr High School Government Office Drive-in Bank High School Non-Residential Level IV Movie Theater Car Sales -New Health Club Medical Office Service Station Supermarket Convenience Market Non-Residential Level V Industrial Park Warehouse General Aviation Airport Pharmacy w/drive through Pharmacy no drive through Service Station w/minimart Mini-Warehouse/Storage ITE Land Use Code Unit of Measure 620 254 NA 947 560 565 948 540 610 ksf-beds ksf-beds ksf/site ksf/stall ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA 590 320 310 520 710, 715, 750 ksf-GFA ksf-rooms ksf-rooms ksf-GFA ksf-GFA 942 813, 815, 890 814 816 522 730 912 530 ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA ksf-GFA 444, 445 841 492, 493 720 944 850 851 ksf-GLA ksf-GFA ksf-GFA ksf-GLA ksf-VFP ksf-GFA ksf-GFA 130 150 22 881 880 945 151 ksf-GFA ksf-GFA ksf/Based aircraft ksf-GFA ksf-GFA ksf-GFA ksf-GFA Total Impact Score 30.9 15.7 15.9 17.7 33.6 34.2 39.8 40.2 40.3 41.1 75.3 62.5 67.4 70.4 87.1 89.1 152.2 119.9 130.5 141.4 151.1 152.8 137.5 166.5 181.8 188.7 319.6 213.6 234.8 278.1 287.8 399.7 398.9 424.3 505.6 452.9 460.5 501.1 514.0 518.5 526.5 526.6 Total Units Annual SMU Per Land Use Rate (Per ksf or Types du) ksf 2038 45 387 34 40 250 72 10 500 700 1446 5 30 225 300 886 1970 124 10 50 1000 100 200 50 36 400 923 200 370 50 148 20 100 35 12320 2000 7500 275 4 6 35 500 75% Annual SMU Burden $ 1.76 $ $ 750,000.00 3,592.47 $ 4.29 $ 6,205.09 $ 8.67 $ 17,088.33 $ 18.21 $ 16,809.97 $ 28.81 $ 354,945.15 Making Auburn’s Model Work for your City (cont.) Sample Rates: $1M Program Rate Class Base Rate Annual Fee Monthly Fee 15,000 sq. ft. Church Non-Residential Level 1 $1.76/ksf $26.40 $2.20 10,000 sq. ft. Office Non-Residential Level 2 $4.29/ksf $42.90 $3.58 65,000 sq. ft. Elementary School Non-Residential Level 2 $4.29/ksf $278.85 $23.24 5,000 sq. ft. Bank with Drive thru Non-Residential Level 3 $8.67/ksf $43.35 $3.61 200,000 sq. ft. High School Non-Residential Level 3 $8.67/ksf $1,734.00 $144.50 35,000 sq. ft Government Office Non-Residential Level 3 $8.67/ksf $303.45 $25.29 10,000 sq. ft. Doctors Office Non-Residential Level 4 $18.21/ksf $182.10 $15.18 Municipal Airport *275 based Aircraft Non-Residential Level 5 $28.81/ksf $7,922.75 $660.23 2,500 sq. ft. Fast Food Restaurant Non-Residential Level 6 $73.38/ksf $183.45 $15.29 125,000 sq. ft. Manufacturing Non-Residential Level 6 $73.38/ksf $9,172.50 $764.38 Residential Level 2 $9.55 $9.55 $0.80 Apartment Is the SMU right for your City? We have seen that depending on the makeup of your city, the variety of land uses, and the dependency of each land use on the freight industry greatly influences whether a revenue source is equitable. We have seen that in many cases although a TBD is a simpler process, it does not provide for an equitable distribution of the burden to keep good roads. We are aware that in order to obtain an alternative source of financing we need our legislators to understand the advantages that the SMU provides to our citizens. Now therefore; Which method do you feel is best for your jurisdiction. Question & Answers