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o A dual approach that increases the property tax levy for smaller projects and utilizes bond financing for the larger infrastructure projects Bonding provides the near -term cash needed to fund projects and reduces the overall impact to the PIR fund through leveled and structured debt service payments. There is not sufficient MSA funds to cover the projects included in the CIP for the next 10 years. Based on current projections, our MSA fund will be short by $2.1 million at the end of 2035 and won't be positive again until 2042. Attachment C is a summary of the City's MSA account as of June 30, 2025. There is a definite need to stay on top of street improvement projects to ensure streets reach their useful lives and don't require costly premature full reconstructions. Several areas of the City are reaching those crucial ages where significant outlay is needed to ensure the long-term vitality of the streets. The 3 types of street improvement projects being considered based on condition are: o Resurfacing is the milling of the top 1.5 to 2 inch surface layer of street pavement and overlaying the street with a new bituminous surface layer. o Full Depth Reclamation involves spot repair of existing curb, milling or reclaiming the full depth of existing bituminous pavement, blending milled material with underlying aggregate material and installing a new bituminous pavement section. o Reconstruction involves removal and replacement of larger quantities of existing curb, installing underlying subgrade correction materials, new aggregate base and a new bituminous pavement section. Projects were programmed to get the City on a schedule of completing a major street reconstruction project every other year. Future PMP projects included in the CIP (2030 and beyond) assume Full Depth Reclamation will be required. Costs will decrease if Resurfacing is required and increase if Reconstruction is required. Public Safety Capital Equipment Fund • The fund is currently being used to account for capital expenditures made by the Lake Johanna Fire Department. • Debt service on the new fire station will begin in 2027 at approximately $270,000 per year. • Self -Contained Breathing Apparatus (SCBA) replacements are scheduled for 2026, with engine/ladder truck replacements scheduled for 2027. • A property tax levy of $300,000 is being proposed for 2026, which includes $40,000 that will go towards the reserve bank for the 6 new fire captains. Economic Development Authority General Fund • A property tax lev of $100,000 is being proposed for 2026, which is unchanged from prior years. In 2025, Council approved a one-time levy transfer of $100,000 from the Economic Development Authority General Fund to the General Fund. Equipment & Building Replacement Fund • The current plan includes recommendations from the comprehensive building reserve study that was completed by Reserve Advisors in May 2025. The plan includes replacing the hydraulic elevator system, furnishings, and security system in 2027, replacing the City Hall air handlers in 2029, and replacing the City Hall roof, entrance canopy and masonry, and concrete flatwork in 2030. Page 3 of 5