Fiscal health: Public Works needs money for roads

Funds from HURF not enough to keep up with maintenance, Public Works director says

A section of Outer Loop Road, part of which was identified by the Chino Valley Roads & Streets Committee as needing a chip seal treatment in January 2018. (Jason Wheeler/Review)

A section of Outer Loop Road, part of which was identified by the Chino Valley Roads & Streets Committee as needing a chip seal treatment in January 2018. (Jason Wheeler/Review)

Editor’s Note – This is the second in a series of articles examining the financial health of the Town of Chino Valley.

The Chino Valley Public Works Department needs more money for maintaining and improving the roads, say both Finance Director Joe Duffy and Public Works Director Frank Marbury.

“To try and keep up our road system at the current level and maintain that current level of repair on the streets, you probably need roughly $1 million without the roads getting worse and worse,” Marbury said. “The more money you can put in after that, the better you can start improving the quality of the roads.”

The Highway User Revenue Fund (HURF) is one of Chino

Public Works/Engineering 2017-18 budget breakdown

Chino Valley Public Works/Engineering budget for fiscal year 2017-18 was $6,985,900.

Here’s just how that breaks down:

• Water enterprise — $2,633,000

• Wastewater enterprise —

$2,340,200.

• HURF (Roads) — $1,094,900

• Personnel — $286,868

• Benefits — $135,532

• Services and Supplies — $453,500

• Interdepartmental/Capital —

$219,000

• Facilities (maint.) — $422,100

• Fleet (maint.) — $279,200

• Departmental — $216,500

Valley’s five major funds, Duffy said. This budget year, it’s possible the town is going to receive between $350,000 and $400,000 from the state, which is not enough to keep up with road maintenance, he said.

For fiscal year 2017-18, the town’s adopted budget noted $1,094,900 from HURF with $453,500 going to services and supplies. The rest of the money went to personnel ($286,868), benefits ($135,532) and interdepartmental/capital ($219,000).

With the current amount of money the town gets from the state HURF, the Public Works Department is looking at repairing about three miles of road out of the 150 miles or so the town has, Marbury said. That’s a 40- to 50-year turnaround time when treatments last seven to 10 years typically, he said. Since the funding is not currently there, the Town Council is looking at various ways to either boost the funding or stretch the dollars as best they can, Marbury said. The Chino Valley Roads & Streets Committee has been considering a few options, such as a sales tax increase or property tax restricted to the roads or a bond, which Marbury said would need a vote.

WATER & SEWER

At first glance, it might look like the water and sewer enterprise funds are more funded, but this is due to how they are set up, Marbury said.

“The way the water and sewer is set up is they’re enterprise funds and that’s more like a business than a government,” he said. “The usage fees, your monthly water or sewer bill, go directly to the water or sewer system to support it and that money stays in those systems … whereas the road system, there’s no toll roads or any sort of user fee set up for streets.”

Unique to Chino Valley is the various water companies within the town and it is a long-term goal of the Town Council to try and consolidate them under the umbrella of the town as much as possible, Marbury said. The challenge for Public Works is in the future, if those systems are acquired, is trying to connect and maintain them at the level needed for health, safety and fire prevention.

Staff knows it has to get infrastructure, such as sewer pipe out onto Highway 89, but that’s costly, Duffy said.

“Sewer pipe … it’s very expensive,” he said. “Extending our water system is very expensive.”

Recently, council members voted to raise water rates as well as water and wastewater enterprise buy-in fees by 3 percent over the next five years, in addition to decreasing wastewater rates by 3 percent over the next five years.

There is a benefit to this as it will repay the money those two enterprise funds have been using from the general fund, Marbury said. In the next year or two, they should be self-sustaining, which is typical for a municipal enterprise fund, he said.

As of fiscal year 2017-18, the water enterprise fund owes the General Fund $452,131. The 3 percent increase would mean after five years, it would owe the general fund $17,226. The sewer enterprise fund currently owes the General Fund $362,013 and would pay that back by fiscal year 2020-21.

The rate increase could also be beneficial in the future should it be a goal of the council, if they decide to build up a repair and expansion fund, Marbury said. However, council members also have to be mindful of making sure the rates are at a competitive level with other municipalities, he said. Rates should not be raised just to build the system. “You have to keep that balance,” he said. “It’s a balancing act of trying to keep the system well maintained, but also provide an economic usage rate for the citizens.”

Those increased rates go into effect Sunday, July 1.

Other than road and street maintenance, if the Public Works Department had the available money, it would look at ensuring the rolling stock, such as heavy equipment and trucks, is current and sufficient, Marbury said. Additionally, since the department takes care of all the facilities, town buildings for maintenance and the fleet system — comprised of the police and town vehicles — it would maintain the buildings and fleets as well. Those are at a pretty good level right now and though some of the equipment is aging, staff keeps it running and together, Marbury said.

“It’s in pretty good shape,” he said. “Some of the things we’re looking at trying to plan for is the town parking lots, especially in this north campus. Some of the parking areas could use improvement. Much like the streets, that’s an expensive proposition.”