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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION — JULY 14, 2025 16 Public Works Director/City Engineer Swearingen said for the PIR he took the 2024 PMP FDR rate and applied 3% every year through 2030. So that 3% is compounding. Then he adds a 25% contingency on top of that. That's why the costs appear to balloon so much. Councilmember Holden asked about the PMP. How many neighborhoods are below 25%. Public Works Director/City Engineer Swearingen said overall the City is really good. He said Karth Lake, the South East, Benton Way, Red Fox and Gray Fox. When excavating near Red Fox they found the pavement thickness is massive because they just kept stacking. That is part of the reason the 2030 number ballooned. There is like 12 inches in some spots. Councilmember Holden wondered if it was possible to switch the order. Public Works Director/City Engineer Swearingen has considered that. If he took that route, he would want to keep the pond dredging in 2028. He thinks it's possible but Benton Way is in pretty rough shape. The 2030 PMP is very technical due to the nature of the businesses. He wanted to give everyone a breather after the Lexington project. Mayor Grant appreciates how they are stacked every two years, allowing one year of an active project and the second year is the punch list and follow up is the next year. He thinks that makes great sense. His opinion is the commercial could be done two years earlier. We should take a look at the financials and determine if that would benefit us. He asked if commercials pay in full or if they are a longer term assessment. Finance Director Yang wrapped up her presentation with Council considerations. Staff is seeking Council direction. We are seeing red starting in 2028. We have some large PMP and construction projects coming through in the next several years. How will we fund them? Councilmember Weber wanted to know what the PIR Levy has looked like, historically. Finance Director Yang said it has been $250,000 going back to 2020. Prior to that it was about $200,000. Councilmember Holden said in reviewing the pages, in 2026, some are priorities. She wondered if some of these are just the 10-year replacement. Public Works Director/City Engineer Swearingen said they have added a new scoring system. Everything in the 5-year CIP related to equipment has a scoring mechanism. Each detail sheet shows the justification along with the scoring. Councilmember Holden asked about an equipment item that is a priority 3. We haven't had many repairs to that equipment, other than it's rusting. Public Works Director/City Engineer Swearingen said that item was approved and has been ordered. Councilmember Holden asked if that was money from this year.