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104 105 Streetlight Maintenance Fund 106 The Streetlight Maintenance fund is programming replacement of street lighting that was previously 107 funded through leases with Xcel Entergy. These leases are coming to an end after a 25-year period, 108 which means the replacement of these streetlights is now the responsibility of the city. This has 109 resulted in increased capital expenses over the next twenty years. For 2025, staff have programmed a 110 transfer of $25,000 from the Excess Cash Reserve fund to provide funding. Public works will continue to 111 analyze options for potential cost savings and alternative revenue sources in the coming years. Details 112 for this fund can be found on Attachment 1, CIP-page 21-22. 113 114 Pathway & Parking Lot Fund 115 The Pathway & Parking Lot fund requires additional funds, based on the addition of new pathway 116 construction to connect the city’s pathway systems. For 2025, staff have programmed a transfer of 117$100,000 from the Excess Cash Reserve fund to provide funding. In future years additional levy support 118 will be needed. Attachment 1 , CIP – pages 23-24 show the details for this fund 119 120 The Capital Improvement needs of the Enterprise funds are programmed into the fees charged in these 121 funds. There are two funds that continue to have either short-term or long-term funding issues. 122 123 Water Fund 124 Since 2020, the City has been working on funding for capital infrastructure needs in the Water fund. In 125 2021, the water fund required debt issuance to address funding for capital projects. These projects were 126 completed in 2022. In 2023, $500,000 of ARPA funds was programmed into this fund to cover the 2023 127 capital needs. In 2024, the remaining $600,000 in ARPA funds was programmed into this fund to 128 address the capital projects in 2024. Public Works staff have re-prioritized the capital infrastructure 129 needs over the next few years to better align with available resources. The last utility rate study 130 identified that the City would need to issue debt to pay for the capital needs of this fund in 2026 and 131 2032. Utility rate increases will cover operations and debt service and a portion of the capital outlay 132 costs. Attachment 1, CIP-pages 28 and 29 show the detailed projects as prioritized by public works and 133 also reflect the issuance of bonds. 134 135 The updated utility rate study will be presented later this fall and staff will continue to annually review 136 and monitor this fund to ensure that adequate resources and fund reserves are maintained. 137 138 Storm Water Fund 139 140 Public Works staff identified significant rehabilitation needs in the Storm Water fund in the 2023 CIP. 141 Historically, only major storm assets such as storm water lift stations were fully analyzed and included in 142 the CIP. Public Works staff reviewed all storm water assets and identified replacement life cycles and 143 costs for each asset. Maintenance costs were identified for each asset per year. The estimates are 144 based on industry standards and staff observations. Water Quality Device Rehabilitation covers storm 145 ponds, rain gardens, etc. Storm infrastructure rehabilitation covers pipes, catch basins, manholes, and 146 outlet structures. Much of the current storm water infrastructure was installed in the 1960’s so those 147 assets are at 80% of their expected lifecycle of 75 years. Public works did a prioritization of projects and 148 has slowed the pace at which projects will be done so there will be sufficient resources to cover the next 149 7 years. Staff will continue to examine alternative funding sources and may consider bonding for larger 150 identified projects in the future. Attachment 1, pages 26 and 27 contain details of the various projects 151 and current funding. 152 153 Funding Strategies 154 The City’s asset replacement programs and associated strategies have proven effective and have 155 positioned the City to achieve financial sustainability with regard to our capital assets. However, a 156 sustainable program requires on-going review and adjustments to our changing needs and costs. 157 158 Based on the needs identified in the 2025-2044 CIP, staff recommend the following strategies. Page 4 of 6 Qbhf!37!pg!99