Apple Valley to Use Capital Projects Funds for Road Reconstruction

The Apple Valley City Council on Thursday unanimously voted to use money from the city's Future Capital Projects fund to provide almost $1 million per year until 2018 for road reconstruction projects, after which time a reduced debt levy could provide for the city to levy the money annually.

The city was looking for an additional $960,000 per year for 10 years to reconstruct its streets, part of the $53 million total estimated need.

The option selected—chosen instead of a tax levy increase or special assessment—would use part of the remaining balance in the city's Future Capital Projects fund each year to bridge the gap until the year 2018, when some of the city's debt is paid off and the debt levy drops by a little more than $1 million per year, said city Finance Director Ron Hedberg.

The $960,000 per year could be then be levied for the road improvement tax levy in subsequent years.

"It is avoiding a spike," city Public Works Director Todd Blomstrom said in December.

City Finance Director Ron Hedberg also said Thursday that about $400,000 of the city's operating budget from 2011 will be moved into the capital projects fund.

Councilmember Clint Hooppaw said Thursday that just because the debt levy drops in 2018 doesn't necessarily mean that come 2018, the city will definitely levy that difference for road improvements.

City officials won't stop being smart about thinking of the best options down the road, Hooppaw said.

The capital projects fund option also had the support of the business community. Apple Valley Chamber of Commerce President Ed Kearney said city staff "really got creative" in finding a solution. 

"I think this will be an asset to talk about in the future" that could promote job growth in Apple Valley, Kearney said; he said that by choosing this funding method, businesses could know that they wouldn't be assessed a large special assessment in the future.

The overall condition of street pavement in Apply Valley is expected to decline based on current available road maintenance funding levels. While the city uses microsurfacing, seal coating and crack sealing to extend the pavement’s surface life, but these maintenance methods have a diminishing return, Blomstrom said in November. 

“Everything is in need of maintenance and replacement eventually,” Blomstrom said in November. “If you get a backlog built up, it is so very difficult to come back from that situation.”

In the near future, about five miles of street will reach its 50-year service life each year. The cost to fully reconstruct an urban street ranges from $800,000 to $1 million per mile.

Blomstrom said Thursday that in talks with members of the public over the last few months, most people backed the idea that road reconstruction is necessary.

On its website, the city has provided a detailed explanation of why staff believes steps toward road reconstruction should happen now, as well as a copy of the presentation of options given to council members on Dec. 20.

The Apple Valley City Council meets at 7 p.m. the second and fourth Thursdays of each month, at the .