PA 512 Capstone Case Analysis

1. PA 512 Capstone Case Analysis City of Madras Transportation Funding Initiative Plan By Gus Burril Public Works Director for the City of Madras Presented to: PSU Faculty and EMPA Cohort, June 12, 2010

2. Problem Statement • Madras transportation funding is not keeping pace with maintenance needs and a significant backlog of deteriorating streets is increasing in size. • 8.9 miles (21.5% of total street system) is in dirt or gravel condition within Madras • 8.15 miles of paved streets (25.1% of streets that are paved) are in need of immediate preservation measures

3. Literature Review/Pre-Research Findings (two groups of information): • Scope and limits of transportation funding for the City of Madras • Madras has a heavy reliance on State and Federal revenue sharing (62%) • Other funding alternatives exist • Political Stakeholder concerns • Professional Interests, Taxpayers, Fuel Suppliers, State Government, Local Government, Street System Users

4. Purpose & Significance of Report • Main objective of this research study: • Prepare a recommended plan of action for implementing an additional funding initiative(s) to increase transportation revenue in the City of Madras for dealing with the significant backlog of street maintenance. • The significance of the report is finding a way to protect the City’s economic vitality and public safety through transportation system investment.

5. Research Questions • Current transportation funding shortfall in the City of Madras? • What other types of local funding alternatives are available and how much revenue is estimated by adopting a new measure? • How have other cities successfully implemented a local funding initiative? • What is the recommended plan of action from the research findings?

6. Research Methods • Used primary and secondary research • Primary – 18 Oregon cities surveyed with local gas tax • Secondary – Literature Review of ODOT, FHWA & published reports by League of Oregon Cities and DEA/SERCA - transportation funding consultant: Total of 27 cities researched. • Purposely selected cities who have passed an alternative form of local funding • Used EXCEL program to analyze data and group common type qualitative responses

7. Research Findings to Question #1 (Shortfall)

8. Research Findings to Question #2 Other funding alternatives & estimated revenue • Using survey data of 18 cities with a local gas tax, adopting a local gas tax at $0.03 per gallon could mean approximately $200,000 in additional revenue per year for Madras. Five funding alternatives (est. annual revenue): • Transportation Utility Fee ($420k) • Local Improvement District (vary by size) • General Obligation Bond ($450k, set # of yrs.) • Increase Utility Franchise Fees ($96k) • Grant Funding (varies, ability to match)

9. Research Findings to Question #3 How other cities successfully implemented a local transportation funding initiative • Make a compelling argument • Elected officials clearly understand the need, take ownership of the issue and are willing to act • Select a fair and reasonable amount to address the problem

10. Research Findings to Question #3 (continued) How other cities successfully implemented a local transportation funding initiative • Public involvement has to occur • Implement a funding initiative campaign effort

11. Discussion of the Research Findings • State and Federal funding options are not the solution • No action postpones and enlarges the problem and jeopardizes the City’s economy, public safety and ability to achieve its mission & goals • A local gas tax is not a funding alternative option until 2014 • Five (5) funding alternatives identified to further analyze for feasibility and priority

12. Funding Alternative Analysis – Eightfold Approach (Bardach) 1) Problem – Street maintenance needs exceed current sources of revenue 2) Evidence – Research Findings; $910,000 annual shortfall; $25 million backlog 3) Transportation Funding Alternatives: • Transportation Utility Fee ($420k) • Local Improvement District (vary by size) • General Obligation Bond ($450k, set # of yrs.) • Increase Utility Franchise Fees ($96k) • Grant Funding (varies, ability to match)

13. Funding Alternative Analysis (continued) 4) Criteria to evaluate the alternatives: • Equitability/Fairness to the rate payers • Provides a consistent source of annual revenue • Value to the community • Value to local government – To what degree does the funding alternative meet the vision, mission and goals of the City? • Feasibility of addressing the transportation funding shortfall • Political acceptability

14. Funding Alternative Analysis (continued) 5) Project the outcomes (Likelihood of the alternative meeting the criteria) 6) Confront the trade-offs (pros & cons)

15. Funding Alternative Analysis (continued) 7) Decide on preferred alternative(s) Scored the alternative probability of meeting the criteria (1 to 5) with highest scores preferred: Highest scores ranked first to last • Increase Utility Franchise Fees - 26 of 30 • Transportation Utility Fee – 25 of 30 • General Obligation Bond – 23 of 30 • Grant Funding – 22 of 30 • Local Improvement District – 18 of 30

16. Recommended Action Plan (Step 8) Step 1: Organize the City Council and or special committee for the funding initiative Step 2: Decide on the alternative and amount - Use the research findings Step 3: Decide how public involvement is going to occur

17. Recommended Action Plan (Step 8) – (continued) Step 4: Implement funding alternative(s) Step 5: Explore and actively pursue grant opportunities from all available sources Step 6: Partner with other public and private organizations Step 7: Assess the progress & adjust as necessary to meet the funding goal

18. Conclusion • All five funding alternatives need to be considered in a phased and leveraging approach to address the significant magnitude of the shortfall in transportation funding. • An educated City Council taking action in a campaign effort forum is a key insight learned for how to successfully develop and implement new transportation funding policy • PSU’s EMPA program preparation to lead

19. Acknowledgements A big thank you to: • My advisor, Professor Morgan and all of the EMPA program Professors, staff and volunteers • Cohort team members • My family, especially my wife, Angela • My supervisor, Mike Morgan • The City of Madras