Title
AN ORDINANCE AUTHORIZING FINANCING OF THE YOUTH DEVELOPMENT CENTER (YDC) DEMOLITION. There will also be consideration given to accelerating the reconstruction of various roads in the city.
Executive Summary: In accordance with the 2013 Five Year Plan, staff is recommending the City finance the demolition of the buildings at YDC over ten years. We have also analyzed the possibility of financing the reconstruction of various roads to shorten the time to complete the projects in 3 years.
Body
Legislative History
None.
Purpose & Explanation
YDC Demo: The YDC demolition cost, with contingency, is estimated at $1,411,000. The estimated interest rate on $1.4 million over ten years would be 1.6%. The estimated annual payment would be $153,000. In the Five Year Plan, we estimated the cost at $1.6 million at an interest rate of 1.65% with annual payments of $175,000.
Reconstruction: We currently have 16.5 lane miles that require reconstruction. The estimated cost is $5.5 million. If we were to finance the cost, our estimated payment for 10 years would be $600,000 per year. In our current Five Year Plan, we have $1 million per year for our resurfacing/reconstruction. If we assume $500,000 of the annual program is applied to reconstruction, we would need an additional $100,000 per year to repay the debt.
At our current pace, we reconstruct 1.5 lane miles per year which means it would take 11 years to complete all reconstructions. If we assume $500,000 per year is applied to reconstruction and assume the cost will increase 3% per year, after 11 years we will have paid approximately $6.4 million vs. $6 million ($600,000 x 10 years) by borrowing the money up front.
Accelerating the reconstruction will allow the roads to be completed sooner and avoid approximately $50,000 per year in maintenance and repair costs. Borrowing $5.5 million will require current and future Councils to understand a significant portion of the annual road program is leveraged ...
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