Rexburg council weighs funding options for street repairs, leans to cover curb-and-gutter in LID 54

Rexburg City Council members and staff spent more than an hour on March 12 outlining funding choices for street reconstruction and Local Improvement District 54, focusing on whether the city should pay curb-and-gutter work while leaving sidewalk installation as a property-owner responsibility.

The discussion, led by city staff and public-works personnel, covered three financing paths: keeping the current LID approach that assigns a large share of street-side costs to property owners; pursuing a permanent levy override that requires a two-thirds vote; or increasing the city’s share of LID costs (for example, paying curb-and-gutter while property owners pay sidewalks). Staff ran multiple spreadsheet scenarios and project-cost examples for the council.

City staff said a permanent override would require a two-thirds majority at the ballot and would be structured as a dollar-amount increase to the budget (not a percentage), meaning the city would set the dollar amount to be added to property-tax revenue. Under the sample shown, a hypothetical $1 million permanent override would move the city’s levy rate from about 0.00312 to about 0.00357 — an increase of 0.00045 — which the staff said would cost roughly $45 per $100,000 of assessed value in the first year. Staff cautioned that a passed override would not produce spending in the immediate term: ballots, budget processes and tax collection timing mean the earliest new revenue would likely appear in January 2027 if a measure passed in a May election the following year.

The council and staff examined the specific numbers for LID 54, described in staff analysis as a large reconstruction project. Staff’s packet identified a total LID 54 project cost of about $4.5 million, with an estimated city share of roughly $3.5 million and a property-owner total near $997,500 under the current policy assumptions. Staff ran alternative scenarios: limiting the city’s participation to replacement-only work and removing costs for new sidewalks and certain add-ons would lower the city and property-owner totals; if the city agreed to pay all curb-and-gutter replacement while leaving sidewalk costs to property owners (30% participation on replacement sidewalks under current policy), the property-owner share on LID 54 dropped in the staff analysis to approximately $722,200. The packet also showed that new sidewalks included in the project amount to about $367,000 in construction costs; if the city subsidized 30% of new sidewalk construction, staff estimated that would add roughly $110,000 to the city’s share for LID 54.

Council members and several staff members reviewed the city’s current levy limits and general-fund picture. Staff noted the city’s general levy maximum listed under Idaho taxing rules as 0.009 and the city’s present general-levy rate at about 0.003124. The city’s property-tax revenue for 2025 was shown in the packet as about $6.9 million. Staff also pointed out multi-year carryover in street-related funds (examples cited: about $7.2 million carryover in one recent year, with lower amounts shown in underlying street-specific funds) and warned that not all carryover is unrestricted: some amounts are already committed to multi-year projects or capital plans.

On tradeoffs and equity, several council members raised that the current LID system tends to hit properties on busier streets more often than quieter residential blocks (because heavy-traffic streets deteriorate sooner), creating an equity concern. Members suggested the city could partly address that inequity by taking on curb-and-gutter costs citywide while keeping sidewalks the property-owner responsibility, and by continuing to offer a higher city participation (50%) where property owners agree to narrow the roadway to lower long-term maintenance costs.

Public-works staff explained typical maintenance strategies (crack sealing, chip seals, cold-in-place recycling and full reconstruction for heavily trafficked streets) and said that even with ongoing maintenance the city’s current resources would replace all streets on a multi-decade schedule; limited budgets push decisions about which streets to prioritize. Staff noted federal funding (for example, FAA grants for airport projects) often requires local matches, and keeping some reserves is prudent if the city pursues large matched projects such as an overpass or other multi-million-dollar capital improvements.

No formal motions or votes were recorded at the meeting. Several council members signaled a policy preference — not yet a formal action — for the city to assume full curb-and-gutter replacement costs on reconstruction projects while preserving the existing approach of 30% city participation for sidewalk replacement (with the option of 50% city participation for neighborhoods that narrow streets to lower long-term costs). Staff said they would prepare revised policy language and bring it back as a formal ordinance or council action item before LID bills are mailed or before LID 54 moves to the next formal step so property owners would know the policy that would apply.

The council discussion also included procedural clarifications: the city relies on the State Tax Commission for ballot-language compliance, Idaho Code sets the statutory levy-rate framework staff used in examples, and the Americans with Disabilities Act (ADA) requires certain corner and ramp work when sidewalks are reconstructed. Staff also noted the city’s prior change to dedicate certain franchise-fee revenues to streets as a permanent budget decision that adds roughly $630,000 per year to street reconstruction capacity compared with earlier practice.

Council members asked staff to return with a specific policy draft that would (1) specify whether curb-and-gutter on reconstruction would be 100% city-funded, (2) clarify sidewalk participation as replacement-only at 30% (and whether new sidewalks would remain a property-owner cost under most scenarios), and (3) preserve the 50% city participation option if property owners agree to narrow a street. Staff agreed to prepare the draft and to show the fiscal impact and timeline before presenting it as an action item.

What happens next: staff will prepare the policy revision and financial scenarios for a future council meeting. Staff also noted that timeline considerations make it preferable to finalize any policy change before LID 54 bills are mailed so affected property owners receive the correct cost estimate under the adopted policy.