Item C: General Obligation Bonds for Street Maintenance

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ATTACHMENT A Pavement Preservation Funding Action History The City’s current 5-cent local gas tax, together with other dedicated pavement preservation funding, has allowed the City to complete nearly $16.5 million in street preservation project work since 2003, with additional contracts in progress. During 2007, more than 17.4 lane miles of slurry seal projects and 20.5 lane miles of rehabilitation projects were completed, including the overlay of portions of 18th Avenue, Chambers th Street and Bailey Hill Road. Projects planned for 2008 include portions of East 13 Avenue, Barger Drive, Chambers Street and Roosevelt Boulevard. In spite of these accomplishments, the backlog of needed repair work continues to grow in the face of rapidly rising construction costs and insufficient revenues. In late 2001, the City was facing an estimated $67 million backlog in pavement preservation work. By spring of 2008, the estimated cost of that backlog had grown to $173 million and, with no new funding, was projected to grow to over $280 million within the next 10 years. In January 2007, council formed a Council Subcommittee on Transportation Funding Solutions (the “subcommittee”) to study transportation funding options and bring back creative solutions for adequately funding Eugene’s transportation system for cars, trucks, bicycles and pedestrians in ways that collect funds proportionately (or equally) from residents and non-residents who use the roads, are more consistent with sustainability goals, have direct connection to use of the roads, and give incentives to those who do not have a car or use one very little. This proposal for a bond measure for street repairs is an integral component in a package strategy recommended by the subcommittee, and approved by council, to adequately and equitably fund Eugene’s transportation system for a variety of users. The package of proposed solutions included a street user fee based on parking spaces, and a street and bike/pedestrian path lighting fee, and an increase in the local motor vehicle fuel tax. The council also took action to extend the local fuel tax sunset provision by three additional years, leaving the fuel tax at five cents per gallon until February 28, 2011. In the course of its work, the subcommittee learned that, in order to completely eliminate the pavement reconstruction backlog within the next 10 years, an estimated $27 million in pavement preservation funding would be needed per year. The subcommittee deemed this revenue target to be too aggressive and, instead, recommended additional annual funding of $13 million to $14 million, bringing total pavement preservation funding up to $18 million per year. While this additional funding would not eliminate the backlog within 10 years, it was projected that it would stabilize the cost-effective annual overlay program and begin to reduce the reconstruction backlog. The subcommittee recommended that the transportation funding package include a capital local option levy generating approximately $6 million net revenues annually to fund pavement capital preservation projects. Council subsequently decided to allocate