04-24-2012 CC RPT 17 - Laserfiche WebLink

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[ City Council Memorandum TO: HONORABLE MAYOR AND CITY COUNCIL DATE: April 24, 2012 FROM: PUBLIC WORKS DEPARTMENT ITEM NO: 17 WARD: ALL SUBJECT: PAVEMENT REHABILITATION OF CITY STREETS ISSUE: The issue for City Council consideration is the issuance of a 20 -year bond backed by the City's Gas Tax and Measure A revenue, generating approximately $32 million for the rehabilitation of the City's arterial and local streets. RECOMMENDATIONS That the City Council conceptually approve proceeding with the pavement rehabilitation program as outlined for the Transportation Committee with the funding mechanism being a bond issue that generates approximately $32 million in project funds with debt service of $3 million per year for a period of 20 years using both Gas Tax and Measure A funds as the source of repayment. COMMITTEE RECOMMENDATION On January 12, 2012, the Public Works Department presented a report to the Transportation Committee on the potential issuance of bonds backed by the City's Gas Tax and Measure A revenue to reduce the backlog of city streets requiring rehabilitation. The Public Works Department also updated the Committee on the City's street maintenance practices. Staff was directed to return to the Committee with a specific proposal. On April 12, 2012 the Transportation Committee (Chair Adams and Members Melendrez and MacArthur present), received a report presented by the Public Works Department proposing to issue 20 year bonds backed by the City's Gas Tax and Measure A revenue, generating approximately $32 million for the rehabilitation of arterial and local streets. The Committee unanimously recommended that the City Council direct staff to proceed with this program and the proposed funding source. BACKGROUND Currently, the City receives approximately $12.8 million in combined State Gas Tax and Measure A revenue. These revenues are used to fund a portion of the Public Works Department Street Maintenance Division and capital improvements, such as street widening projects, concrete repair and street rehabilitation projects. 17 -1