Item A: Status Report on Local Gas Tax

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that amount. Specifically, the local motor vehicle fuel tax funds approximately $3 million annually and the five-year street bond funds approximately $6.5 million annually through FY14. Road Operations and Maintenance (O&M) Needs – The Road Fund (O&M) provides for street operations , services such as street lighting and signals, street signage and striping, pothole patching and crack sealing concrete and asphalt street repairs, and snow and ice operations. Prior to the passage of HB 2001, the Road Fund had come to rely on service reductions and the use of reserves together with transfers from the General Fund and other sources to maintain a minimum level of service. The operating reserve balance was exhausted by FY10 and the annual deficit for street operation and maintenance services in the Road Fund was projected to exceed $3 million in FY11, growing to over $4 million by FY13. However, with the new state transportation bill, the City is expecting to receive approximately $3 million in additional state highway funding each year. This funding, combined with revenues from the utility systems for the use and occupancy of the City's right-of-way, will lessen the road operations funding gap reported in previous years. Even with the progress realized from the current funding levels, the six-year forecast ends with less than one month of balance available, an amount below the two-month target. This forecast includes continuing the pavement repair project on unimproved streets (aka the “Enhanced Pothole Repair Program”) at the level of $200,000 per year for the next six years. Pavement Preservation Progress Since the local gas tax funded Pavement Preservation Program (PPP) was started in 2002, the City has completed nearly $18 million in street preservation project work funded through the local gas tax, and another $4.8 million in gas tax funded projects is scheduled in 2011. Through 2010, nearly 250 lane miles of streets – more than 20 percent of the City’s total improved street system – have been repaired with PPP slurry seals, overlays and reconstruction. The PPP projects are in addition to bond measure, assessment, and grant-funded paving projects and the crack sealing, pothole patching, concrete panel replacement and other ongoing street repair services performed by Public Works Maintenance Division. Gas tax funded ththrd projects completed in 2010 include portions of 11 Avenue, 13 Avenue, 33 Avenue, Goodpasture Island Road, Hawkins Lane, Oakway Road, Patterson and Valley River Drive. Projects planned for 2011 th include portions of City View, Wilson Street, Conger Street, Jefferson Street, Washington Street and 13 Avenue. Attachment A provides a history of pavement preservation program projects from 2002 – 2011. The 2011 Pavement Management Report (Attachment B) was compiled by the Public Works Maintenance Division’s Surface Technical Team to provide updated information on the condition of asphalt paving in Eugene using 2010 rating and inventory data. The report includes an inventory of streets by improvement status and functional classification, details how a pavement management system is used to inspect and rate pavement surfaces, explains Eugene’s pavement preservation program, and includes updated information about treatment types and costs. The updated report on the condition of Eugene’s streets shows progress has been made but more work is needed to further reduce the backlog of needed repairs on the 1,324 lane miles of streets in the City. RELATED COUNCIL GOALS AND POLICIES The council’s Vision and Goals Statement with respect to Fair, Stable and Adequate Financial Resources reaffirms commitment to “a local government whose ongoing financial resources are based on a fair and equitable system of taxation and other revenue sources and are adequate to maintain and deliver municipal services.” The council’s goals include “Transportation Initiative: Develop mechanisms to adequately fund our transportation system for cars, trucks, bikes and pedestrians including maintenance \ \cesrv500\CC Support\CMO\2011 Council Agendas\M110615\S110615A.doc