Public Works Road Fund Overview

May 2, 2013

Tanya Heaton,

PW Budget Manager

Current Situation

Shrinking revenue

Cost increases

Increasing service requests

Expenses exceed revenue

Road Fund Focus

Customer Service

Road Safety

Road Preservation

Stewardship

Sweet Creek Road

Current grant project, work began summer 2012. Damage to the road due to retaining wall failure. 10 years of progressive deterioration.

Road Fund - Key Points

One major revenue stream significantly influenced by economy

Dedicated State Revenue --restricts use to road purposes

FY 13-14 Beginning Fund Balance ~ $29m

FY 13-14 Ending Fund Balance ~ $14m (Reserves)

0

10

20

30

40

50

60

FY 08-09ODOT

Revenue Share

New Normal

Annual Operating RevenueM

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on

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Updated: April 2013

FY 12-13Last SRS payment

Annual revenue decreases $17 million in six years

What are we doing?

Plan and reach for a balance of excellent and sustainable services Seeking revenue opportunities

Building project partnerships

Reducing expenses

Spending reserves

Budget Direction

FY 12-13 Begin reductions to close Road Fund Gap

Reduce operational expenses by 20%

FY 13-14 Limited Growth – Personnel Services at

contract level and Materials &Services at CPI of 1.6%

Maintain FY 12-13 service levels when feasible

Road Fund Revenue Changes

Road Fund Expense Changes

Sweet Creek Project

Bedrock was deeper than anticipated and warranted changes during construction.

Fund Balance HistoryM

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on

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Updated: April 2013

FY 12-13Last SRS payment

Draw down of Fund Balance to provide services over more years

Why are Contingencies and Reserves so Important?

Savings accounts

Planning tool

Stewardship of reserves provides time to respond to economic factors and meet goals

Sweet Creek Project

The site is very constrained by the river on one side and a vertical rock bluff on the other, maximum width is 23 feet.

Sweet Creek Project

Bridge Caps were required to support bridge beams and the roadway.

What do we see for the future?

Revenue Flat at lower level

Steady cost increases

Decreasing ability to meet service requests

Shrinking Reserves

ForecastFY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19

Lane County Road Fund Proposed Projected Projected Projected Projected Projected

REVENUE

[1] New Resources 28,196,610 28,768,288 29,204,286 29,677,601 30,249,717 30,671,477

[2] Beginning Fund Balance 29,535,882 14,094,862 11,382,367 7,942,755 6,307,149 4,728,907

[3] TOTAL REVENUE 57,732,492 42,863,150 40,586,653 37,620,357 36,556,866 35,400,384

OPERATING EXPENDITURES

[4] Personnel Services 16,550,306 17,265,337 14,317,763 14,414,867 13,768,776 13,808,339

[5] Materials & Services 15,755,731 15,848,532 13,955,468 14,513,686 14,262,464 14,597,694

[6] Capital Expenses 82,200 83,515 84,935 86,464 88,193 89,957

[7] Fiscal Transactions 371,719 371,719 367,819 373,919 377,769 381,319

[8] Weigmaster Sheriff's Office 0 0 0 0 0 0

[9] Management Services 305,569 311,680 317,914 324,272 330,758 337,373

[10] SUB-TOTAL OPERATING EXPENDITURES 33,065,525 33,880,783 29,043,898 29,713,208 28,827,959 29,214,682

[11] Reductions to Balance 0 (6,000,000) 0 (2,000,000) (600,000) (2,000,000)

[12] ADJUSTED OPERATING EXPENSES 33,065,525 27,880,783 29,043,898 27,713,208 28,227,959 27,214,682

[13] CAPITAL EXPENDITURES

[14] Capital Projects & Contracts 6,614,978 3,600,000 3,600,000 3,600,000 3,600,000 3,600,000

[15] SUB-TOTAL CAPITAL EXPENDITURES 6,614,978 3,600,000 3,600,000 3,600,000 3,600,000 3,600,000

[16] Transfer to SO 3,957,127 0 0 0 0 0

[17] TOTAL ROAD FUND EXPENDITURES 43,637,630 31,480,783 32,643,898 31,313,208 31,827,959 30,814,682

[18] ROAD FUND BALANCE 14,094,862 11,382,367 7,942,755 6,307,149 4,728,907 4,585,702

CONTINGENCIES & RESERVES

[19] Prudent Person Reserve 5,741,000 4,315,243 4,380,643 3,561,312 3,024,972 3,067,148

[20] Road & Bridge Emergency Contingency 2,800,000 2,800,000 1,400,000 938,000 628,460 550,000

[21] Retiree Benefits Reserve 1,275,000 1,275,000 0 0 0 0

[22] Reserve for Future 2,598,000 1,500,000 0 0 0 0

[23] Seasonal Cash Flow 1,265,000 900,000 900,000 900,000 900,000 900,000

[24] Unappropriated Reserve 0 0 0 0 0 0

[25] SUB-TOTAL CONTINGENCY & RESERVES 13,679,000 10,790,243 6,680,643 5,399,312 4,553,432 4,517,148

[26] AVAILABLE FUND BALANCE 415,862 592,124 1,262,112 907,837 175,475 68,555

Budget Concerns

Reducing the gap

Cost escalations

Budget variables

Balancing operations and reserves with resource requests

Sweet Creek Project

Last concrete slab being lowered into place. 105 slabs were used to build 7900 linear foot of foundation for the roadway. Each slab is 4ft wide and 30in deep

with lengths from 50 to 80 feet.

Coming Soon

Balancing needs with resources

Revenue Operations, Maintenance, and

Preservation Emergency response Safety Improvements Expansion ~ Territorial Road, Goshen

Sweet Creek Road

Grant supported project. Total cost of project $6.4 million, received grants of $5.6 million. Balanced with reserves.