Included in each City budget is a 5-Year capital improvement program (CIP) which covers the next budget and four years beyond. The 5-Year CIP allows for medium range planning of expenditures and phasing of projects. The CIP is comprised of two portions, Capital Projects, which can be best described as construction-related activities; have a useful life of 10 years or more and are valued at $50,000 or more; and Capital Purchases, which are just that, purchases of major pieces of equipment, necessary for the general operation of the City, have a useful life of five or more years, and are valued at $5,000 or more (per unit).
The CIP budget represents a major investment in the community’s future and infrastructure, while maintaining significant funding for operations and service levels to meet City Council goals. The Fiscal Years 2015-2020 Capital Improvement Program (CIP) is a multi-year plan for capital expenditures to replace and expand the City’s infrastructure, vehicles and equipment. The program is updated annually to reflect the latest Council priorities, to provide updated cost estimates, and to identify available revenue sources.
Preparing the Capital Improvement Program requires identifying the various sources of revenue for the projects such as debt, federal grants, state grants, existing reserves and Capital Pay As You Go. Currently the City does not list any CIP’s that will be funded either through issuing new bonds (general obligation or revenue) or other debt financing.
In addition, each project must be evaluated as to the impact it will have on the City’s operating budget. New facilities and acquisitions require staff, utilities, maintenance and other costs that must be included in the operating budget. Equipment purchases should have a planned replacement and maintenance schedule. Building and infrastructure improvements should have efficiency, utility savings and service enhancements designed into the projects.