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Rawlins council budget review flags $2.0 million shortfall on Edinburgh Street project; staff outlines funding options
Summary
City Manager Tom Sarvey told the Rawlins City Council that the 6P specific-purpose fund will be roughly $2.0 million short of the current $8.2 million engineering estimate for the Edinburgh Street replacement and presented options including a short-term general-fund loan, use of impact-assistance funds, or charging utility-related work to water/sewer funds.
City Manager Tom Sarvey told the Rawlins City Council that the city’s specific-purpose (6P) tax fund will not cover the current engineering estimate to replace Edinburgh Street and that council will need to decide how to cover an estimated shortfall.
“By June 30 we estimate the fund balance will be about $6.3 million, and the current engineering estimate for Edinburgh is $8.2 million,” City Manager Tom Sarvey said. “We’re about $2 million short of having the funding for Edinburgh.”
Sarvey said the 6P fund’s cash balance was roughly $4.8 million at the close of the last audited fiscal year, with additional receipts subsequently bringing the balance higher; staff projected roughly $6.3 million by June 30 after expected remaining tax receipts. The Edinburgh project’s current estimate of about $8.2 million comes from the engineering firm the city used for design estimates, Sarvey said.
Why it matters: Edinburgh was one of the projects the public approved when voters authorized the 6P specific-purpose tax. Council members were warned the 6P proceeds were never expected to fully cover all originally profiled projects at current construction prices.
Options presented
Sarvey presented three primary options for council to consider if the higher estimate holds: - A short-term loan from the general fund to the specific-purpose fund to be repaid as additional 6P receipts arrive. - Direct use of general-fund cash reserves to bridge the gap. - Charging roughly $1.0 million of the project to water/sewer utility (for replacement of water/sewer lines within the street) so those utility funds pay the utility-related portion.
“Within the budget last year preparation, the decision was made by council to allocate $1,000,000 of impact assistance funds to go over to help subsidize the impact or the Edinburgh project,” Sarvey said. “If we were to take a million dollars from impact, that would bring the total to $7.3 million. That would leave us $855,000 short of the $8.2.”
Council questions and timeline
Council members asked whether the water and sewer funds currently have the cash to cover a $1.0 million utility portion; staff replied those funds could cover it today but would be quickly drawn down by other planned projects. Council member Steve Sanger asked whether the council could defer committing funds until final bids or summer receipts are known; staff said postponement is possible, but cautioned the schedule and construction season could be affected.
Sarvey also cautioned that the $8.2 million is an engineering estimate and “we don’t know for sure if it’s 8.2. That’s the current estimate” and that costs could change as the design is finalized.
No formal decision was made at the meeting. Sarvey said council would see a vote later in the budget process if staff recommends a loan or transfer.
Provenance (transcript evidence): topic discussion began when Sarvey moved to the 6P fund discussion and concluded when council members questioned the cost comparison with other street projects.
