City of Morgan Hill Adopted Budget FY 2016-17 and FY 2017-18

 CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL 

Street Maintenance

(continued)

FINANCIAL COMMENTS Funding for Street Maintenance comes primarily from the City’s share of state gas taxes and transfers from the sewer and water enterprises reflecting their responsibility for wear and tear on the streets. Since gas taxes are collected based on gallons, and not on the price of gas the amount of gas tax revenue received by the City has remained more or less flat, while the cost of street maintenance has increased over time due to inflation. The latest street condition report completed in March 2016 indicated that the City’s weighted average pavement condition index (PCI) is 67. Given the City’s current planned expenditures in the Pavement Rehabilitation Program budget in the CIP, the PCI will fall below 60 in 2021 and deferred maintenance will exceed $41 million. In order to maintain a PCI of 67, it will be necessary to increase the City’s annual capital expenditures to $3.9 million. While this level of investment would stabilize the PCI over the next 5 years, it would still result in an increase in deferred maintenance to $31 million by 2021. Annual expenditures of over $6 million annually would be required to begin to address the City’s deferred maintenance backlog and would also result in a projected increase in the City’s PCI to 72 by 2021.

 CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18

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