Item B: Road Fund Update - Laserfiche WebLink

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Program Cost-Cutting Measures - Responding to the challenge of identifying opportunities for ongoing cost savings, Public Works is implementing $178,000 of reductions in the FY10 Road Fund operating budget through the redeployment of several employee positions from traditional Road Fund work (street debris removal, development review, night call response) to address emerging needs in other City programs. Staff believes these cost savings are both achievable and sustainable without significant reductions in service or public response. Across the City, staff continues to explore other opportunities for increasing efficiencies and reducing costs. Some of these budget-saving strategies, such as voluntary furloughs, deferred replacement of equipment and vehicles, and reduced use of outside consultants and services, are anticipated to benefit funds and operating budgets across the organization. One-time Funding Strategy - Responding to council direction to bring back a one-time funding strategy to maintain street O&M services through FY10, the City Manager is proposing a three-part funding package as a FY10 stop gap solution, comprised of the following elements: Redirect a portion of the FY10 local gas tax revenues to street O&M 1. - Redirect a maximum of $1.4 million of FY10 local motor vehicle fuel tax revenue from capital pavement preservation to critical street O&M services and back-fill the pavement preservation program funding with the $3.0 million of Federal stimulus payments dedicated to that purpose. Total proposed contribution to FY10 Road Fund budget = $1.4 million ? Next Steps: No specific council action is required since the Road Fund appropriation already exists in the City Manager’s Proposed Budget to spend these flexible revenues for any road operation, maintenance or preservation purpose. Impose a 5% transportation surcharge on solid waste haulers 2. - Move forward with steps to implement a smaller 5% surcharge on solid waste (garbage) haulers, which is estimated to generate $900,000 for FY10 and would increase the bill for a residential customer with a weekly 32-gallon service by an additional 98-cents per month. Commercial customers would see a proportionate 5% increase in their bills for garbage service. Attachment A illustrates the estimated financial impact of the proposed 5% garbage surcharge on a range of residential and commercial customers at various levels of service, along with a list of seven actual commercial customers and the estimated financial impact of the proposed surcharge on their monthly bills. The transportation surcharge would be assessed against solid waste haulers to better reflect the physical and financial impact that their operations impose on the city street system as a result of heavy hauler vehicles running on the majority of city streets every week. This surcharge would be assessed against solid waste haulers on the premise that heavy solid waste trucks cause significantly more damage to city streets than do other categories of lighter vehicles and run largely on local streets, which do not hold up as well under heavy vehicle use. The surcharge also represents fair compensation for private use of the right-of-way, a public asset that haulers rely on to deliver their services. Total proposed contribution to FY10 Road Fund budget = approx. $900,000 ? Next Steps: In moving forward with implementation of this new 5% transportation surcharge on solid waste haulers, the City Manager intends to schedule a public hearing on April 20, to receive public comment on the proposed amendments to the Eugene City Code that would permit the transportation surcharge on solid waste hauler fees to be used for the repair, maintenance, operation and preservation of City-owned roads and streets (see Attachment B). City Council action on those proposed amendments is tentatively scheduled for April 27. If the council adopts the ordinance Z:\CMO\2009 Council Agendas\M090408\S090408B.doc