The beginning of the 2019 budget process involves the preparation of the 5-year CIP. Capital improvements are the projects that require the expenditure of public funds for the acquisition, construction, or replacement of infrastructure and capital assets necessary for the community.  The creation and update of a multi-year capital plan allows the city to plan for current and long-term needs. Projects include buildings, information technology, parks, streets, equipment replacement, sanitary sewer and storm drainage.

This is the second year of our stand-alone CIP. The document continues to be a work in progress as staff become more comfortable with the new process and CIP software. Transparency is a top priority in all aspects of the budget process including the CIP. Part of that transparency is having easily understandable budget documents. We want our budget documents to tell a story. This CIP has incorporated more narratives, pictures and maps to help all users of this document better understand upcoming projects.   

The plan for the workshop is to have a general overview of each fund and then review various projects within each fund. Staff is seeking the council's input in regards to project direction and priority. 

Within many of the funds are pending or future projects. These project pages are located towards the end of each fund's respective section. These projects can be pending for a number of reasons such as the project is dependent upon outside funding, the need is not warranted at this time, or to simply keep the project on our radar. Below are a few highlights from various CIP funds. Several projects also have a " * " in the front of the title.  This indicates projects are contingent on receiving funding from outside sources.

Park Reserve Fund

• A majority of the projects in this fund have been moved out a year or more, or have been reclassified as pending projects and are waiting the results of the Parks System Master Plan.

Capital Improvement Fund

• This fund continues to see the most activity with complex projects that often include various funding sources. The city engineer and his staff have vetted all the street related projects this year to help ensure better cost estimating.  In the end, project costs are still estimates but by ensuring better cost estimating we are able to better plan the timing and financing of projects with minimal unexpected surprises. The City will likely have to
  
  consider bonding for the special assessment portions of various projects rather than cash flowing special assessments as it has done for the last several years.  
• The property tax levy dedicated to the capital improvement fund will need to be increased over the next several years. $100,000 yearly increases are included in each of the next five years.
• Notable projects include: 17th Avenue School Pedestrian Crossings, Canterbury Commons City Infrastructure Improvements, Street and Utility Reconstruction, and several others.

Equipment Fund

• Equipment purchases are all for replacement equipment except for one pending project that is for a John Deere commercial mower/snowblower that would be shared between park maintenance and the community center. The community center would use the piece of equipment in the winter for snow removal and park maintenance would use it the summer for field and park mowing.
• Rents are increasing modestly over the next 5 years. Staff is finding that vehicles with a useful life of 10 years and longer, the replacement cost is significantly higher than the original price. For example, the two new fire engines were recently purchased at a price of $620,000 each. The rent charge for the past 20 years has been based off of a prior purchase price of $350,000. This difference between replacement and historical cost puts pressure on the fund's cash balance beyond the next five years. 

Building Fund

• Fire Station #3 remains the biggest project in the fund, of which, funding is yet to be determined.
• Rents have been adjusted to account for the removal of the old city hall, the addition of the new city hall, and the completion of the community center and ice arena. The community center and ice arena are being charged a rent rate of 35% of the cost due to the current bonds on the facility. Once the bonds are paid, rents will increase to 100%. 

Sanitary Sewer Fund

• Major projects include trunk sewer extensions on the west end of the city, sewer extension to the Maras Street, 13th Avenue and Hanson Avenue area, and later pipe rehabilitation.
• Major equipment purchases include a sewer vacuum scheduled for 2019 and a sewer jetter scheduled for 2022.

Storm Drainage Fund

• This fund is experiencing an uptick in activity as the city ensures compliance with varies regulatory agencies.
• Major projects include the Prior Lake Outlet Channel Improvements, Storm water improvements along Hwy 101, west end regional pond and trunk oversizing, and the NE Shakopee storm water BMP retrofit. 
• Major equipment purchases include a street sweeper in 2019, a water tanker in 2020, a tractor slope mower in 2021, and tractor in 2022.

A final 2019-2023 CIP will be prepared after receiving council input and direction, and will be officially adopted by the council later this summer or early fall. The CIP projects scheduled for 2019 will then be incorporated into the 2019 operating budget for further consideration in adoption of the overall 2019 budget.