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
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Session Goals:
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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….
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281 Cities and Towns in Washington State are currently
responsible for 16,421 miles of streets.
Motor Vehicle Fuel Tax (MVFT) Declining
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Local General Fund Options (Sales Tax, Property Tax, Real Estate
Excise Tax etc.)
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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
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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
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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?
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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?
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Description
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Financing options- Councilmanic
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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)
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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?
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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
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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
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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
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City of Auburn Background Data
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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
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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
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Step 1: Data Collection
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Land Use Data
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Local Traffic Data
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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
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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.)
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Step 2: Populate SMU
spreadsheet and sort
into groups by Total
Impact Score
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Policy Questions:
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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.)
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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?
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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