The City Council learned Tuesday that, with labor costs much more under control, it won’t be unfunded liabilities that cause it grief when trying to balance next year’s budget, but rather two new dilemmas: paying for road and bike path pavement maintenance and for escalating water costs.
City Manager Steve Pinkerton explained to the council in his preliminary fiscal year 2013-14 budget presentation that the city could be facing a structural deficit of about $2 million next year, and almost $6 million by 2018, largely because of the two massive line items.
As Pinkerton and Interim Public Works Director Bob Clarke warned, it’s likely going to take a large investment by the city over the next few years to adequately address Davis’ deteriorating bicycle paths and roadways.
“No matter which direction you go, you’re looking at a need for a major cash infusion,” Pinkerton said.
How major? Clarke presented the viable potential financing scenarios and among those that he believed the council could consider, none would have the city invest less than about $16 million over the next two years.
Beyond that, Davis likely will have to spend between $5 million and $8 million per year after the initial injection of funds, simply to maintain the quality of the roads and bike paths at current levels.
If the council continued the practice of allocating only $1 million to pavement maintenance annually, as past councils have authorized, more than half of the city’s roads and bike paths would fail by 2032 and the cost of backlogged work to fix those roads would climb to about $440 million.
The city and the council will have options on how to structure a maintenance plan that will address the crumbling roads, Clarke explained, such as lowering the city’s goal for the average pavement condition index and prioritizing important streets. But no matter the plan, there comes a large cost.
Pinkerton said that at this stage, it would be more useful to stake out the amount of funding the council would like to dedicate to roads and then later mold a more detailed pavement management plan.
The council unanimously passed a motion that included having city staff come back with proposals on how to raise the $16 million to $25 million the city likely will need to put the city’s road and bike path infrastructure back on solid footing.
Meanwhile, the increase in water rates that the City Council adopted last month to pay for the Woodland-Davis Clean Water Agency surface water project will be felt by all who consume the city’s water, and that includes the city itself.
Pinkerton estimates that the city’s water consumption costs will rise from about $775,000 to $3 million in 2018 if no effort is made to conserve.
While the city has access to many tools that could help it reduce water consumption, such as replacing inefficient irrigation systems or converting greenbelt turf areas to native or drought-resistant, low-maintenance landscape areas, the general fund is still likely to take a hit.
However, Pinkerton is confident the city can offset some of those costs.
“It’s going to mean looking … at every blade of grass and determining whether that needs to be sod or whether that can be some kind of other nice green thing that doesn’t require as much grass or require as much mowing,” Pinkerton said. “Because that’s another area where we can save costs.
“If we can also reduce our mowing costs at the same time through the types of plantings we can do, hopefully between the two of them we can cut out this whole $2 million potential hit to the budget.”
The city, which is the largest “irrigator” in town, is responsible for watering about 474 acres of parks, greenbelts and public landscapes. Almost half of that space consists of turf.
Pinkerton will return to the council on April 30 with a formal fiscal year 2013-14 budget proposal for its approval.
— Reach Tom Sakash at email@example.com or 530-747-8057. Follow him on Twitter at @TomSakash