City of prosser


Capital Financing Strategy



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Capital Financing Strategy

The Capital Facility Plan’s (CFP) financial strategy is a planning tool. It does not prescribe specific courses of action, nor does itself authorize individual projects. Such authorization occurs when a project is included in the city’s six year Capital Improvement Program (CIP) and through the city’s annual budget process. The strategy is flexible and seeks to identify how all of the project needs that are “on the table” can be funded in an orderly, long-term fashion.

Each individual capital facility analysis discussed in preceding sections of this plan identifies proposed facility needs and potential funding options. This information is consolidated in the finance strategy of this plan.
CFP Figure: : Land Use and Capital Facilities

The process of developing a Capital Facilities Plan (CFP) includes identifying the capital facilities and other services needed to support the land use plan. Once these needs are identified, an important step in the CFP planning process is to assess whether sufficient revenues will be available to finance those needed facilities. This involves balancing three different elements (land use, facilities and finance) into a coordinated system of planning. The considerations that might be included in achieving this balance is illustrated by Figure CFP-3. As illustrated on Figure CFP 3, the land use commitment creates a demand for facilities and thereby a need to finance those facilities, it also generates revenue and funding opportunities to finance those facilities.

The finance strategy in this plan starts with a forecast of population, employment and development activity as outlined in the supporting documents. These forecasts are then used to identify the capital facilities that this growth would need. These forecasts are accompanied by a analysis of the city’s financial capacity described in City of Prosser’s Fiscal Capacity. From these forecasts and analysis, a long-range financial strategy was developed to guide the financing of all of the facilities necessary for development and to address other significant community needs, as well as strategies to finance key facilities. The overall analysis and strategy demonstrates that the city has sufficient financial capacity to support the land use plan over the entire planning period.

This strategy should be annually reviewed and refined as projects are implemented and needs and issues change. All cost and revenue estimates in the strategy are generalized based on accepted engineering and/or construction cost factors, and financial forecasting methods. All revenue and cost estimates reflect the current construction costs and values. The cost estimates may be expected to change during the actual engineering and design phase of each project. Just as the land use commitment creates a demand for facilities, it also generates revenue and funding opportunities to finance those facilities. However, if there is not enough financing to meet the land use commitment then measures need to be taken to achieve a balance. New financing measures (such as raising a tax or increasing developer contributions) might be authorized. The city could also reduce the future land commitment or the planned levels of service, if necessary.

Available Overall Fiscal Capacity and Resources


As described above, a key part of developing a long-range financial strategy is to understand the fiscal capacity of the city and how the planned growth of the city will change that capacity. The present and future fiscal capacity of the city was analyzed in the related background report; City of Prosser’s Fiscal Capacity. The conclusions and findings of that study may be summarized as follows:

  • The city is fiscally sound with new revenues exceeding ongoing costs, providing positive fund balances in all funds. The most significant exception to this view is the water fund, which currently has declining fund balances.
  • General fund fiscal conditions have been improving with rising sales and utility tax revenue. However, these revenues are highly sensitive to economic conditions and will vary substantially from year to year with the performance of the regional economy.


  • The available fund balances of the city provide it some capacity to finance needed facilities. However, due the relatively small scale of city operations and the high costs of new facilities, the fund balances cannot go very far in meeting potential needs. Also, declining fund balances in the water utility severely constrain the capacity of that utility to finance capital facilities and their operations.

  • Limitations on the city tax rates as imposed by state law severely restrict the ability of the city to capture this value for future needs.

  • The city has a relatively high average per capita volume of taxable sales—but a large share (54%—over half) of this revenue comes from the cyclical construction and automotive sectors.

  • While sales tax revenue has been increasing in recent years, much of this growth is driven by the construction and automotive sectors, which can vary substantially from year to year.

  • The city was increasing its dependence on utility taxes since 2000.

  • The city has invested significant resources in capital development with grants and borrowing.

  • The city appears to compete effectively for outside financial assistance, especially for transportation grants.

  • Since the value of new construction generally exceeds the value of existing structures, growth will raise the average assessed value of the city significantly.

  • Growth will enhance fiscal capacity by increasing property values from new construction and enhancing the market for larger volumes of taxable sales.

  • Steady growth could improve the economies of scale in some services, especially utilities.

  • Business growth (both industrial and commercial) can be expected to expand the city’s utility tax base.
  • The current revenue income in the water funds may be insufficient to meet the operational and capital needs of those funds through the forecast period.


  • The sewer fund appears to be well positioned to respond to both its operations and capital needs (if the city periodically adjusts sewer rates for inflation).

  • Rising assessed values through growth and appreciation increases the city’s general obligation debt capacity and increases the potential revenues generated by the Real Estate Excise Tax (REET).

  • The city may need much of the current sources of general fund revenue just to sustain adequate levels of service for operations in the face of inflation and growth. However, a limited amount may be available for capital if economic development does create an expanded sales tax base or if inflation rates do not increase significantly.

  • The small scale of city revenues makes it difficult for the city to amass funds for a large capital facility.

  • The city will need to adjust periodically rates in order to meet both operational and capital needs.

  • A strategy sufficient to fund the facilities necessary to support the planned growth will depend in large part on developer financing.

  • By applying appropriate financial planning strategies, including maximizing the potential for developer financing of facilities, the city has the fiscal capacity to support the land use plan in the long-run, although not all of the needs identified in the financially unconstrained needs list may be funded. In particular, the city has the capacity to set an acceptable level of services for the facilities necessary for development that can be appropriately funded.

  • Financing the city’s water system as proposed will require implementation of the financial measures recommended in the draft Water System Plan.
  • The city, however, is facing significant short-term financial challenges that will make it difficult to finance important facilities (especially an improvement of the Merlot/Wine Country Road intersection, a new water reservoir, and water and sewer freeway crossings to serve the UGA north of the freeway).


  • The city will need to maintain a balance between securing developer contributions adequate to fund a significant portion of the anticipated capital needs while avoiding discouraging new development activity.

  • The city has recently formed a Transportation Benefit District (TBD) which is anticipated to generate $90,000 to $100,000 per year.6 With population economic growth the TBD should generate approximately $1.8 million additional revenue for street needs over the forecast period.



Capital Revenues and Other Financial Measures



CFP Figure: : - Potential Growth in Tax Collections 2007-2008


Population and business growth planned in the land use plan and estimated in the background report Land Use Patterns, Trends and Needs will increase all forms of tax revenue. The background report, City of Prosser’s Fiscal Capacity forecasted the amount of revenue that this future development as will generate for each major type of tax revenue. Figure CFP 4 brings together the forecasts for each type of tax revenue in one figure. As noted, the city’s reliance on the utility and sales taxes would increase significantly over the forecast period. This financial forecast assumes that all of the UGA will be annexed.
CFP Table: : Potential Cumulative Revenues (2007 Dollars)

Table CFP 11 estimates the amount of money that would be generated cumulatively over the forecast period by 2025. The revenue estimates are calculated on Table CFP 11 by estimating and adding up the additional revenue that would be generated (as described above) each year from annexation and development of the UGA, if the UGA were developed and annexed each year in equal increments to the year 2025. The amount represented is the cumulative increase over the tax revenue currently received by the city. Since the revenue shown is the total amount generated not including any additional operating costs, this shows how much money would be available if ALL of the revenue generated from new development were available for capital purposes. In reality, the city would need to use a significant portion, if not most, of this revenue for increased operation expenses needed to serve the UGA with ongoing city services.

CFP Figure: : Revenues Compared to Expenses


Figure CFP 5 compares the revenue generated from the development of the city and annexation of the UGA into the city with the capital facility costs described above. As can be readily seen in Figure CFP 5, the city will not have the capacity to finance the needed facilities out of additional tax revenue that would be generated by the new development, even if all of the revenue generated by new growth was dedicated for capital purposes, although the financial analysis in City of Prosser’s Fiscal Capacity demonstrates that the city will need most of the operating revenues generated by the growth to support city operations. The city will need to rely on other sources of financing such as developer contributions and grants. Although the city has been successful in obtaining grants in the past, it is highly unlikely that grants can make up much of the potential deficit and the city will need to rely on developer financing to finance the facilities needed to support the anticipated development.

As outlined in the City of Prosser’s Fiscal Capacity, there are three basic reasons that it may be appropriate to require private development to contribute to the financing of public facilities.




  1. To make the project feasible,

  2. Because the facilities will benefit the development, and

  3. To offset adverse impacts of the development on the level of service or the delivery of services provided by the city.

A variety of financing mechanisms or tools have evolved for developer financing to serve these purposes. These include requiring developers to directly construct facilities, provide specific compensation to the local government to build new facilities, and sophisticated impact fee systems that seek to equitably share the costs of new facilities over all potential developments.

The strategy below assesses the potential for developer financing for various projects that will be needed to support the plan based on the location and character those projects. Many of the projects identified in the needs analysis are suitable for developer financing based on these considerations.


Balancing Needs and Capital Revenues

There is insufficient revenue capacity available to fund all projects on the unconstrained needs list. Further, not all of the facilities identified are necessary to support new development, although they may be desirable for achieving the quality of services and life the community desires.


The approach to developing this financial strategy is illustrated by the concentric rings of need on Figure CFP 6. The total of the diagram represents the total unconstrained needs list. The figure shows four levels of need.

CFP Figure: : Strategic Financing Approach

Basic Needs: The first level of need (usually the smallest subset of needs) are basic needs that must be met or significant hazards, inefficiencies, greater costs or problems will result. These include removing traffic hazards, severe points of congestion, replacing inadequate facilities in parks and public buildings, rehabilitating or restoring deteriorating streets or facilities, and providing appropriate office space. Some of the projects at this level might be considered deficiencies. This class of facilities should have priority over the available local resources (although some of these resources might be used to support other important priorities in one of the other categories).

Key Facilities: The second type of need consists of facilities that remove a significant barrier for further community development. While these facilities are closely related to the system projects identified in the third type of need, these are particularly important projects that affect the potential development of a broad area. The nature of these facilities may indicate a need for a variety of funding approaches including use of city funding as a “strategic” investment.


Facilities Necessary to Support Development: The third type of need consists of needs necessary to support development. Without these projects, the minimum levels of service needed to support new development would not be achieved or maintained. These projects include both system expansion needs and site-specific needs to serve development.


  • System projects are those needed in order to maintain the performance of the overall system as the community develops. More system-oriented financing, such as general revenues, and grants could finance a major portion of these projects. Some of these projects may not be needed until future development generates impacts or needs that would cause the level of service of facilities to begin to fall below acceptable levels (as defined in the comprehensive plan).

  • The site-specific projects are those that directly serve, or are adjacent to (or within) development projects. The financing of these supporting facilities can be incorporated directly into the development process and can be financed through site specific financing mechanisms such as local improvement districts, delay agreements, late comers or reimbursement agreements etc. For many such projects, a project would not be needed if the immediate area does not develop and in these cases, the projects can be indefinitely deferred until a development project needs the project.

Enhancement Projects: The fourth level of need are those projects that improve the overall community or enhance the general quality of life. These projects may include street improvements to provide additional transportation options, enhance the appeal of downtown, provide new parks or add new features to existing parks. These projects may be funded from revenues available after the other needs are addressed. If there are insufficient revenues to fund these projects, additional funds may be sought from grants or proposals for voter approved bond or other sources of revenue that cannot be predicted in advance.

The various need assessments described above have identified $151 million dollars in needs for various public services (Table CFP 10).

The tables below apply the strategies and funding tools generally described above to the unconstrained needs list of projects. This analysis is long-range and strategic. By providing a strategic approach to financing facilities, the strategy illustrates how the city can, in the long-range, organize its needs and opportunities to finance the implementation of the comprehensive plan.
Table CFP 12 identifies the potential funding sources for various needed projects. Most of the projects that open the UGA for development are appropriate for developer financing and are identified on the figure for this type of funding. In most cases, these projects are needed just to make development of these areas feasible.
There are three projects (the two water and sewer freeway crossings and the north water reservoir) that open significant portions of UGA for development and should be considered key projects that may be appropriate for some types of city funding in order to facilitate their development—and there may be some limited opportunity for grant assistance. In addition, the north water reservoir provides benefit to other areas of the city by improving water pressure throughout the water delivery system. Improvement to the Merlot/Wine Country Road intersection is also identified as a key project necessary to support the continued development of a developing area in the city (and a small portion of the UGA). These intersection improvements can be funded by a variety of sources including grants, contributions from developments impacting the intersection, and city financing.
The strategy includes the potential of a golf course in the Prosser area that has been included in previous capital facility plans of the city, but it classifies this project as an enhancement project that would be built if such a course can be feasibly developed from revenues from the course, developer contributions or grants.

The previously adopted Capital Improvement Plan (2007) identifies potential funding sources for projects in the CIP, and the draft water plan identifies funding for water projects it recommends.

Table CFP 12 allocates the identified needed projects by the various strategies described above. Fifty-six percent (56%) of the total need is appropriate for direct developer financing. An additional 19% linked to development at partial developer financing, indicating that up to 75% of the needs list would be suitable for significant developer financing. As noted in the discussion above, most of these projects are needed only if the development occurs and the projects may be indefinitely deferred if the development does not proceed. Almost all of the remainder could qualify for some type of grant that could finance part of the project.
CFP Table: : Categorizing Projects

Street Development Costs

Total Estimated Costs

Potential Funding Sources (by order of potential or appropriateness)

Strategy

Direct Developer Responsibility

At Least Partial Developer/Property Owner Responsibility

Potential Grant

UGA Local Streets

UGA Major Collector

UGA Minor Collector

Merlot/Wine Country Rd Intersection

BFCOG Identified Projects

City Street Development Plans*


$23,401,477

$27,023,851

$4,019,585

$1,987,000

$4,893,000

$18,533,127


Developer financing

Developer financing

Developer financing

Grants, developer contributions, City

LID, Property Owners, Grants, City

Grants and City



Necessary for Development

Necessary for Development

Necessary for Development

Key Facility

Enhancements

57% Basic: 47% Enhancements



$23,401,477

$27,023,851

$4,019,585


$1,987,000

$4,893,000

$18,533,127



Total

$79,858,040
















Utility Development Costs



















Water System

UGA 8” lines

UGA 12” lines

North Reservoir Costs

Other Water Plan Costs

Water Freeway Costs



Total Water

$6,868,339

$6,562,935

$2,912,900

$6,682,440

$500,000


$23,526,614

Developer financing

Developer financing

City, Developer, Grants

City and Grants(as per draft water plan)

Developer contributions, Grants, City


Necessary for Development

Necessary for Development

Key Facility

Basic Needs, Some Enhancements

Key Facility


$6,868,339

$6,562,935

$2,912,900


$500,000


$6,682,440


Sewer System

UGA 8 inch lines

UGA 10 to 12 inch lines

UGA-Pressure lines and pumps

Sewer Freeway Crossing

Other Sewer CIP Costs*

City by 2025

City by Buildout

Urban Reserve/Steep Slope Residential

Total Sewer

$2,680,687

$7,440,015

$2,653,286

$500,000

$9,242,000

$395,852

$6,096,993

$2,360,045

$31,368,878

Developer financing

Developer financing

Developer financing

Developer contributions, Grants, City

City, Grants, Developer participation

City, Grants, Developer participation

City, Grants, Developer participation

Developer financing

Necessary for Development

Necessary for Development

Necessary for Development

Key Facility

Basic Needs, Some Enhancements

Basic Needs, Some Enhancements

Enhancement

Enhancement

$2,680,687

$7,440,015

$2,653,286

$2,360,045


$500,000

$9,242,000

$395,852

$6,096,993







Total

$54,895,492
















General Fund



















Parks

Community Park

Neighborhood Park

Hillside Acquisition and Trails

Water Front Trail

Golf Course

Other Park CIP*

Total Parks

General Government

Police Station

New Shop Construction***

Other CIP*

Total General Government


Total General Funding

$2,500,000

$1,748,450

$250,000


$250,000

$1,800,000

$2,522,600

$9,071,050

$3,660,000

$3,500,000

$497,500

$7,657,500

$16,728,550

Grants and City

Developer financing and City

Grants, Donations, City

Grants, Donations, City

Special Revenue**

City, Other Agencies, Grants

Enhancement

Necessary for Development

Enhancement

Enhancement

Enhancement

Various (mostly basic)

Basic Needs

Basic Needs

Basic Needs


$1,800,000




$1,748,450

$250,000

$2,500,000

$250,000
$2,522,600

$3,660,000


$497,500


Total

$151,482,082





$84,810,220


$28,526,195

$34,645,667

Percent










56%

19%

23%

*Funding Potential as listed in CIP

**Would be by golf course revenues, developer contributions

***Funding strategy would be equally by street, water, and sewer funds

Table CFP 12 also applies the strategic designations from Figure CFP 6. The funding strategies described above come together by integrating column identifying potential funding sources with the potential strategies.


Table CFP 13 takes Table CFP 12 a step further, estimating the amount of the needs list that would be derived from different sources by type of project. As such this table provides a long range financing strategy to meet the city’s long range needs.

Part A of Table CFP 13 identifies and categorizes the entire needs list by the strategy described above. “Projects necessary for development” includes all of those projects in the UGA and other projects within the city that are appropriate for direct developer financing as indicated on Figure CFP 6. The “key projects” are those described on the preceding page that, while needed for development, serve a large area and may provide benefits to other parts of the city. Basic needs are those projects needed to maintain adequately existing facilities, address some deficiency, or address some basic community need. “Enhancement projects” are those projects for which funding may not be identified and are of lesser urgency that those projects identified as basic needs. These projects would be developed as funding may be developed in the future. Enhancement projects include some projects identified in the sewer plan that may not be needed until after 2025.

Part B of Table CFP 13 of the figure identifies the potential for these needs to be financed by various forms of contributions, primarily, but not exclusively,7 from grants and developers. The potential for developer financing is based on the discussion above, and in detail in Fiscal Capacity Report, describing the appropriateness of this source of revenue for project feasibility and the benefit that such projects provide to nearby properties. A few projects are included that may be needed to address the potential impact of further development.
The potential for grant funding is more difficult to anticipate and the estimates on the table are based on evaluating the appropriateness of individual projects and comparing those projects to the funding sources described above and as described in detail in Fiscal Capacity Report. As noted in the Fiscal Capacity Report, the matching rate can vary and can be as much as 80% of the costs of a project. The planning level estimates here assume an average of 60% grant or developer funding for transportation projects and 50% for other types of projects identified as appropriate for grant funding. This anticipates that some projects would be funded at more than that rate and other projects at less than that rate. If this average is maintained, additional city funding would need to be developed for the city to meet these “basic” needs. In most cases, individual enhancement projects would depend on such grant financing and would not proceed without such assistance.
(One identified general governmental project, the public works shops, is appropriate for financing by the utilities. Table 13 spreads the costs for this project equally over the general and water and sewer funds).

CFP Table: : Long-range Financial Strategy

Part C of Table CFP 13 identifies the amount of local funds that would be needed to finance the strategy, approximately 23% of the overall list of capital facilities.

Part C of Table CFP 13 identifies $8,421,850 (2007 dollars) of the basic needs and key facilities that will have to come from general governmental funds. This is 55% of the total additional tax revenue that would be generated (Table CFP 11) by the new development during the forecast period. However, $3,944,334 million, almost half of the funds needed, would be generated by the REET, which can be used only for capital expenditures. In addition, in the past year the city added a significant new revenue source that can be available for financing street projects in the form of a creating a Transportation Benefit District (TBD). While the potential revenue from this source has not yet been determined by the city council, this revenue can be used for street capital needs and is anticipated to generate as much as $1.8 million over the forecast period. The remaining $2,650,660 ($8,421,850 minus REET of $3,944,334 and $1,826,856) would require 23% of the non-REET tax revenue.
Obtaining 23% from the total tax revenue generated by new development solely for capital is a challenging task, but is realistic if the city manages its fiscal resources carefully balancing capital needs with on-going costs, especially if the city continues in being successful in competing for grants and ensuring that new development pays an appropriate amount for the facilities needed. Over the 18-year funding period careful planning and budgeting, including prudent use of the fund balances identified on Table CFP 14 ($2.5 million is available in general governmental funds outside of the General and Street funds which are appropriate for operating reserves), could finance this need. In addition, the city may consider a bond issue for significant portions of this need. A likely candidate for such financing would be the police station, which has generally fared well as a bond issue in other communities.

Table CFP 13 Part C identifies $8.3 million of sewer needs classified as basic and key facilities that will need to be funded by local funding. The sewer funds have 3 million in fund balance that can be applied toward these needs. The balance will probably require future rate adjustments to address.

Similarly on Table CFP 13 Part C over $6.2 million are identified for local funding as water system basic needs or key facilities. Almost $3.4 million of this is associated with the proposed new northern reservoir and pump station. To address this need, the proposed Water System Plan by the city’s engineers proposes a financial plan to finance the facilities needed through rate increases. If these recommendations are implemented, the water funds will have the capacity to finance the needs identified in this analysis (which is based on the Water System Plan for the areas within the city limits8).


CFP Table: : Fund Balances

In addition to potential rate adjustments in the utilities to ensure the fiscal capacity of the city to meet its long-range needs, the city could consider updating its existing system development charges as authorized by RCW 35.92.025. A system development charge is specifically calculated to recover a proportionate share of the city’s past investment in its physical plant. A system development charge is like an impact fee, but is based on past costs, rather than future costs. Past costs must be based on the original cost of the facilities when they were built—not their value today. However, interest since the original cost was incurred may also be included in the formula. Furthermore, the city can recalculate the charge whenever a significant capital investment is made. For example, although the city cannot charge for the reservoir now (as it would be with an impact fee) the city can recover an appropriate share of the costs of the reservoir from new development after the reservoir is built. One particular advantage of the charge is that there are no limitations on how the city uses the money after it is collected (other than that it must be used by the utility involved). The revenue from the charge does not need to be used only for capital—since it recovers existing sunk costs.

Another potential source of revenue for capital the city could consider is an impact fee for parks. Such a fee can be applied to new development as a means to assist in financing the proposed neighborhood park (a fee for this park could be calculated on the basis of the service area north of the river) and for the community park. Impact fees for these facilities are appropriate since larger parks are difficult to finance through direct developer mitigations (no one development would by itself create the need for a larger park—instead direct mitigations are best for financing a system of smaller parks).
However, the city should consider impact fees for transportation needs with caution. Direct mitigation, requiring the developers to build new streets along with utility extensions into the UGA, would be a more effective approach to financing facilities into the UGA. This could not be directly required for the system improvements identified in this analysis if the city had an impact fee system.
A particularly important part of the financing strategy is to coordinate annexation with the development of public facilities. The city should continue its policy of not extending water and sewer services outside the city to insure that needed street, water, and sewer facilities to serve the UGA are treated as a package.9 Ideally, the city should not annex an area unless appropriate financing agreements are included in the process. However, the city may decide to annex areas in order to have more control over how the area might develop. In these circumstances, it should nonetheless be clear in the process how the city would require new facilities to be financed.

Six Year Capital Facilities Development Program

The long-range financial strategy outlines a general approach to funding the needs identified in the comprehensive planning process. This strategy is implemented in a detailed six-year financing plan that identifies how and when specific projects are programmed to be implemented over the next six years. Since the long-range strategy is generalized and intended to be flexible in responding to varying funding opportunities and constraints that will occur each year, the six year plan is based on a year-to-year assessment of changes in opportunities and constraints. For example, the six-year plan may pursue specific grant opportunities that may be available to assist in funding projects that may not have been specifically anticipated in the long-range strategy. Similarly, the six-year revenue estimates need to reflect a current forecast of business cycles that may be averaged in the long-term strategy. If the current business cycle is poor, less development would occur, generating less revenue. Conversely, a better business cycle may stimulate more development, allowing more projects to be funded in the short-term. These opportunities and constraints will need to be evaluated each year in evaluating how, when and how much of the long term strategy can be implemented within each six year program and the program amended accordingly. This evaluation would occur in conjunction with the reassessment strategy (Policy LOS 1.3) to insure that the construction of facilities maintains the levels of service necessary to support actual development that is and will be occurring over the six-year period. Since anticipated revenue generation is linked to development (e.g. new development will generate the revenue needed to finance projects), it will be possible to coordinate the financing of needed facilities with the actual development of property as such development occurs.

The six-year financial plan primarily includes those projects that are funded or built with public funding. Since developer construction or financed construction does not often include public funding, these projects are not included in the six year CIP (unless they do involve some sort of public financing).

As part of the annual budget process the city will:


  • review the needs list for each system,

  • examine the progress on projects currently being engineered or constructed,

  • evaluate funding resources likely to be available during the next six years,

  • identify projects necessary to support development at adopted levels of service,

  • evaluate which projects appear to be feasible for implementation during the following six years, and

  • other factors related to which projects are most needed and appear ready for implementation.

Pursuant to Policy LOS 1.3 the city’s progress in providing the facilities necessary to support development that is occurring at the adopted levels of service shall be assessed as part of the process of the annual update to the six-year capital improvement program. This update is done as part of the city budget process.


On the basis of this analysis, the city will update the annual six-year capital improvement program, adjusting it for progress made on each project to date and other changes that may affect the implementation schedule of the projects on the previous program and add those projects that appear most feasible, needed to the six year program.
The current six-year capital improvement program and financial plan is presented on CIP Tables 1 though 5


CIP Table 1:: SIX YEAR TRANSPORTATION IMPROVEMENT PROGRAM

CIP Table 2: WATER SYSTEM CAPITAL IMPROVEMENT PROGRAM






CIP Table 3: SEWER SYSTEM CAPITAL IMPROVEMENT PROGRAM


CIP Table 4: PARKS SYSTEM IMPROVEMENT PROGRAM



Street Maintenance Program to be funded by the Prosser Transportation Benefit District

The City of Prosser formed a Transportation Benefit District in 2009, pursuant to the authority of RCW Chapter 36.73. The purpose of the Transportation Benefit District (TBD) is to pay for transportation improvements identified in statewide, regional, or local transportation improvement programs. The City of Prosser’s transportation improvement program, to be funded by the Prosser Transportation Benefit District, is set forth in table T-1 below and the Maintenance Area Map identified as T-2 below. This local improvement program is in addition to the other programs previously identified in the Capital Facilities Plan. The TBD funds will be used to finance the projects listed on table T-1. The TBD funds may be used as a match in order to obtain grants, loans, or other financing in order to complete the improvements listed on table T-1. Developer financing will pay for a portion of the improvements listed in table T-1. The TBD lacks adequate financing to complete all improvements listed on table T-1, therefore the City or TBD will have to secure other funding sources, including developer financing when improvement can be required at the time of development, in order to meet the goal of completing the improvements in table T-1 within 5 years.

Table T-1




Table T-2CIP Table 5: GENERAL GOVERNMENT IMPROVEMENT PROGRAM



APPENDIX


DEFINITION OF TERMS

Adequate Capital Facilities: facilities which have the capacity to serve development without decreasing levels of service below locally established minimums.

Agricultural Land: land primarily devoted to the commercial production of horticultural, viticulture, floricultural, dairy, apiary, vegetable, or animal products or of berries, grain, hay, straw, turf, seed, Christmas trees not subject to the excise tax imposed by RCW 84.33.100 through 84.33.140, or livestock and land that has long-term commercial significance for agricultural production.

Arterial (Minor): a roadway providing movement along significant corridors of traffic flow. Traffic volumes, speeds and trip lengths are high, although usually not as great as those associated with principal arterials.

Arterial (Principal): a roadway providing movement along major corridors of traffic flow. Traffic volumes, speeds, and trip lengths are high, usually greater than those associated with minor arterials.

Available Capital Facilities: facilities or services are in place or that a financial commitment is in place to provide the facilities or services within a specified time. In the case of transportation, the specified time is six years from the time of development.

Capacity: the measure of the ability to provide a level of service on a public facility.


Capital Budget: the portion of each local government's budget which reflects capital improvements for a fiscal year.


Capital Improvement: physical assets constructed or purchased to provide, improve, or replace a public facility and which are large scale and high in cost. The cost of a capital improvement is generally non-recurring and may require multi-year financing.

Collector: a roadway providing service which is of relative moderate traffic volume, moderate trip length, and moderate operating speed. Collector roads collect and distribute traffic between local roads and arterial roads.

Commercial Uses: activities within land areas which are predominately connected with the sale, rental, and distribution of products, or performance of services.

Comprehensive Plan: a generalized coordinated land use policy statement of the governing body of a county or city that is adopted pursuant to this chapter.

Concurrency: adequate capital facilities are available when the impacts of development occur. This definition includes the two concepts or "adequate capital facilities" and of "available capital facilities" as defined above.

Consistency: that no feature of a plan or regulation is incompatible with any other feature of a plan or regulation. Consistency is indicative of a capacity for orderly integration or operation with other elements in a system.

Coordination: consultation and cooperation among jurisdictions.

Contiguous Development: development of areas immediately adjacent to one another.

Critical Areas: include the following areas and ecosystems: (a) wetlands; (b) areas with a critical recharging effect on aquifers used for potable water; (c) fish and wildlife habitat conservation areas; (d) frequently flooded areas; and (e) geologically hazardous areas.

Cultural Resources: are elements of the physical environment that are evidence of human activity and occupation. Cultural resources include: (a) historic resources which are elements of the built environment typically 50 years of age and older, and may be buildings, structures, sites, objects, and districts; (b) archaeological resources consist of remains of the human environment at or below the ground surface such as habitation sites; and (c) traditional cultural properties consist of places or sites of human activities which are of significance to the traditions or ceremonies of a culture. Traditional cultural properties do not necessarily have a manmade component and may consist of an entirely natural setting.


Density: a measure of the intensity of development, generally expressed in terms of dwelling units per acre. It can also be expressed in terms of population density (i.e., people per acre). Density is useful for establishing a balance between potential local service use and service capacities.

Domestic Water System: any system providing a supply of potable water for the intended use of a development which is deemed adequate pursuant to RCW 19.27.097.

Financial Commitment: that sources of public or private funds or combinations thereof have been identified which will be sufficient to finance capital facilities necessary to support development and that there is assurance that such funds will be timely put to that end.

Forest Land: land primarily useful for growing trees, including Christmas trees subject to the excise tax imposed under RCW 84.33.100 through 84.33.140, for commercial purposes, and that has long-term commercial significance for growing trees commercially.

Geologically Hazardous Areas: areas that because of their susceptibility to erosion, sliding, earthquake, or other geological events, are not suited to the siting of commercial, residential, or industrial development consistent with public health or safety concerns.

Goal: the long-term end toward which programs or activities are ultimately directed.

Growth Management: a method to guide development in order to minimize adverse environmental and fiscal impacts and maximize the health, safety, and welfare benefits to the residents of the community.

Household: a household includes all the persons who occupy a group of rooms or a single room which constitutes a housing unit.

Impact Fee: a fee levied by a local government on new development so that the new development pays its proportionate share of the cost of new or expanded facilities required to service that development.


Industrial Uses: the activities predominately connected with manufacturing, assembly, processing, or storage of products.

Infrastructure: those man-made structures which serve the common needs of the population, such as: sewage disposal systems, potable water wells serving a system, solid waste disposal sites or retention areas, stormwater systems, utilities, bridges, and roadways.

Intensity: a measure of land uses activity based on density, use, mass, size, and impact.

Land Development Regulations: any controls placed on development or land use activities by a county or city, including, but not limited to, zoning ordinances, subdivision ordinances, rezoning, building codes, sign regulations, binding site plan ordinances, or any other regulations controlling the development of land.

Level of Service (LOS): an indicator of the extent or degree of service provided by, or proposed to be provided by, a facility based on and related to the operational characteristics of the facility. LOS means an established minimum capacity of capital facilities or services provided by capital facilities that must be provided per unit of demand or other appropriate measure of need.

Local Road: a roadway providing service which is of relatively low traffic volume, short average trip length or minimal through traffic movements.

Long-Term Commercial Significance: includes the growing capacity, productivity, and soil composition of the land for long-term commercial production, in consideration with the land's proximity to population areas, and the possibility of more intense uses of the land.

Manufactured Housing: a manufactured building or major portion of a building designed for long-term residential use. It is designed and constructed for transportation to a site for installation and occupancy when connected to required utilities.

Master Planned Resort: a self-contained and fully integrated planned unit development, in a setting of significant natural amenities, with primary focus on destination resort facilities consisting of short-term visitor accommodations associated with a range of developed on-site indoor or outdoor recreational facilities.

Minerals: include gravel, sand, and valuable metallic substances.

Mobile Home: a single portable manufactured housing unit, or a combination of two or more such units connected on-site, that is:


  • designed to be used for living, sleeping, sanitation, cooking, and eating purposes by one family only and containing independent kitchen, sanitary, and sleeping facilities;

  • designed so that each housing unit can be transported on its own chassis;

  • placed on a temporary or semi-permanent foundation; and

  • is over 32 feet in length and over eight feet in width.

Multi-Family Housing: as used in this plan, multi-family housing is all housing which is designed to accommodate four or more households.

Natural Resource Lands: agricultural, forest, and mineral resource lands which have long-term commercial significance.

New Fully Contained Community: is a development proposed for location outside of the initially designated urban growth areas which is characterized by urban densities, uses, and services.

Objective: a specific, measurable, intermediate end that is achievable and marks progress towards a goal.

Open Space: underdeveloped land that serves a functional role in the life of the community. This term is subdivided into the following:
  1. Pastoral or recreational open space areas that serve active or passive recreational needs, e.g., federal, state, regional and local parks, forests, historic sites, etc.


  2. Utilitarian open space are those areas not suitable for residential or other development due to the existence of hazardous and/or environmentally sensitive conditions, which can be protected through open space, e.g., critical areas, airport flight zones, wellfields, etc. This category is sometimes referred to as "health and safety" open space.

  3. Corridor or linear open space are areas through which people travel, and which may also serve an aesthetic or leisure purpose. For example, an interstate highway may connect point A to Point B, but may also offer an enjoyable pleasure drive for the family. This open space is also significant in its ability to connect one residential of leisure area with another.

Overriding Public Interest: when this term is used, i.e., public interest, concern, or objective, it shall be determined by a majority vote of the City Council.

Owner: any person or entity, including a cooperative or a public housing authority [PT-IA], having the legal rights to sell, lease, or sublease any form of real property.



Planning Period: the 20-year period following the adoption of a comprehensive plan or such longer period as may have been selected as the initial planning horizon by the planning jurisdiction.

Policy: the way in which programs and activities are conducted to achieve an identified goal.



Public Facilities: include streets, roads, highways, sidewalks, street and road lighting systems, traffic signals, domestic water systems, storm and sanitary sewer systems, parks and recreational facilities, and schools. These physical structures are owned or operated by a government entity which provides or supports a public service.

Public Services: include fire protection and suppression, law enforcement, public health, education, recreation, environmental protection, and other governmental services.


Regional Transportation Plan: the transportation plan for the regionally designated transportation system which is produced by the Regional Transportation Planning Organization.

Regional Transportation Planning Organization (RTPO): the voluntary organization conforming to RCW 47.80.020, consisting of local governments within a region containing one or more counties which have common transportation interests.

Resident Population: inhabitants counted in the same manner utilized by the U.S. Bureau of the Census, in the category of total population. Resident population does not include seasonal population.

Right-of-Way: land in which the state, a county, or a municipality owns the fee simple title or has an easement dedicated or required for a transportation or utility use.

Rural Lands: all lands which are not within an urban growth area and are not designated as natural resource lands having long-term commercial significance for production of agricultural products, timber, or the extraction of minerals.

Sanitary Sewer Systems: all facilities, including approved on-site disposal facilities, used in the collection, transmission, storage, treatment, or discharge of any waterborne waste, whether domestic in origin or a combination of domestic, commercial, or industrial waste.

Shall: a directive or requirement.

Should: an expectation.

Single-Family Housing: as used in this plan, a single-family unit is a detached housing unit designed for occupancy by not more than one household. This definition does not include manufactured housing, which is treated as a separate category.

Solid Waste Handling Facility: any facility for the transfer or ultimate disposal of solid waste, including landfills and municipal incinerators.

Transportation Facilities: includes capital facilities related to air, water, or land transportation.


Transportation Level of Service Standards: a measure which describes the operational condition of the travel stream, usually in terms of speed and travel time, freedom to maneuver, traffic interruptions, comfort, convenience, and safety.

Transportation System Management (TSM): low capital expenditures to increase the capacity of the transportation network. TSM strategies include but are not limited to signalization, channelization, and bus turn-outs.

Transportation Demand Management Strategies (TDM): strategies aimed at changing travel behavior rather than at expanding the transportation network to meet travel demand. Such strategies can include the promotion of work hour changes, ride-sharing option, parking policies, and telecommuting.

Urban Growth: refers to growth that makes intensive use of land for the location of buildings, structures, and impermeable surfaces to such a degree as to be incompatible with the primary use of such land for the production of food, other agricultural products, or fiber, or the extraction of mineral resources. When allowed to spread over wide areas, urban growth typically requires urban governmental services. "Characterized by urban growth" refers to land having urban

growth located on it, or to land located in relationship to an area with urban growth on it as to be appropriate for urban growth.



Urban Growth Area: those areas designated by a county pursuant to RCW 36.70A.110.

Urban Governmental Services: include those governmental services historically and typically delivered by cities, and include storm and sanitary sewer systems, domestic water systems, street cleaning services, fire and police protection services, public transit services, and other public utilities associated with urban areas and normally not associated with non-urban areas.

Utilities: facilities serving the public by means of a network of wires or pipes, and structures ancillary thereto. Included are systems for the delivery of natural gas, electricity, telecommunications services, water, and the disposal of sewage.


Vacant/Underdeveloped Lands: may suggest the following: (a) a site which has not been developed with either buildings or capital facility improvements, or has a building improvement value of less than $500 [vacant land]; (b) a site within an existing urbanized area that may have capital facilities available to the site creating infill development; (c) a site which is occupied by a use consistent with the zoning but contains enough land to be further subdivided without needing a rezone (partially-used); and (d) a site which has been developed with both a structure and capital facilities and is zoned for more intensive use than that which occupies the site (under­utilized).

Visioning: a process of citizen involvement to determine values and ideals for the future of a community and to transform those values and ideals into manageable and feasible community goals.

Wetland: areas that are inundated or saturated by surface water or ground water at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs, and similar areas. Wetlands do not include those artificial wetlands intentionally created from non-wetland sites, including, but not limited to, irrigation and drainage ditches, grass-lined swales, canals, detention facilities, wastewater treatment facilities, farm ponds, and landscape amenities. However, wetlands may include those artificial wetlands intentionally created from non-wetland areas created to mitigate conversion of wetlands, if permitted by the county or city.

Zoning: the demarcation of any area by ordinance (text and map) into zones and the establishment of regulations to govern the uses within those zones (commercial, industrial, residential) and the location, bulk, height, shape, and coverage of structures within each zone.

ACRONYMS

ACE Advisory Committee on Elements

ADT Average Daily Traffic

AFDC Aid to Families with Dependent Children

BMR Below Market Rate

BPA Bonneville Power Administration

BFRC Benton-Franklin Regional Council

CAG Citizens Advisory Group

CNG Cascade Natural Gas

CBD Central Business District

CDBG Community Development Block Grant

CEAP Consolidated Emergency Assistance Program

CFP Capital Facilities Plan

CIP Capital Improvement Program

CWSP Coordinated Water System Plan

CWSSA Critical Water Supply Service Area

DCD Washington Department of Community Development

DHV Design Hourly Volume

DOE Department of Ecology

DOH Washington Department of Health

DNR Washington Department of Natural Resources

DSHS Washington Department of Social and Health Services

EIS Environmental Impact Statement

EMF Electromagnetic Fields

EPA U.S. Environmental Protection Agency

FAA Federal Aviation Administration

FAP Family Assistance Program

FCC Federal Communications Commission

FERC Federal Energy Regulatory Commission

FHA Federal Housing Administration

FHWA Federal Highway Administration

GIS Geographic Information Systems

GMA Growth Management Act

GMCC Growth Management Coordination Committee

GPCD Gallons Per Capita Per Day

GPM Gallons Per Minute

GWMA Groundwater Management Area

HCT High Capacity Transit

HOV high occupancy vehicle

HUD U.S. Department of Housing and Urban Development

JLUS Joint Land Use Study

LID Local Improvement Districts

LOS Level of Service

National Gas Policy Act

National Pollutant Discharge Elimination System

MFS Minimum Functional Standards

MID Maximum Instantaneous Demand

MPC Master Planned Community

MPO Metropolitan Planning Organization

MPR Master Planned Resort

MSA Metropolitan Service Areas

NGPA National Gas Policy Act

NPDES National Pollutant Discharge Elimination System

NWP Northwest Pipeline Corporation

OFM Washington State Office of Financial Management

PDD Planned Development District

PUD Public Utility District

RCRA Resource Conservation and Recovery Act

RCW Revised Code of Washington

RDF Refuse Derived Fuel

REA Rural Electric Association

RSA Rural Service Area

RTPO Regional Transportation Planning Organization

RECD Rural Economic and Community Development

SEPA Washington State Environmental Policy Act

SIC Standard Industrial Classification

SOV Single occupant vehicle

SWAC Solid Waste Advisory Committee

TAR Transportation Assessment Report

TDM Transportation Demand Management

TSM Transportation System Management

UGA Urban Growth Area

ULID Utility Local Improvement District

USDOE United States Department of Energy

WAC Washington Administrative Code

WDOE Washington Department of Ecology

WSDOT Washington State Department of Transportation

WUTC Washington Utilities and Transportation Commission


1 At 138 acres needed to accommodate 621 units: an additional 25% for infrastructure=35 acres, 30% for property owner plans=41 acres, and a 30% market factor=41 acres. 35+41+41=117.

2 The urban growth area could accommodate the high population forecast for 2020.

3 Restatement of County Policies for essential facilities.

4 The Wine Country Road “bridge” is actually two bridges.

5 Costs and cost factors for the water system are from HLA, the city’s contract engineers. Cost factors for 12- and 8 inch sewer lines, and the freeway crossing for the sewer systems, are also from HLA. Other cost factors estimated by Dugan Planning Services.

6 City Finance Department

7 Contributions may include participation by other governmental entities.

8 The water system plan does not significantly address the area outside the city.

9 Once water and sewer service is provided, the city would have less leverage to finance needed street improvements.




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