ALCP projects near completion as costs rise; staff cites inflation, stormwater and right-of-way
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Summary
Nathan Domi and other staff updated the Budget Review Commission on Scottsdale's Arterial Life Cycle Program on March 19 and reported substantial budget increases on several major ALCP segments due to combined inflation, stormwater and right-of-way costs.
Nathan Domi and other staff updated the Budget Review Commission on Scottsdale's Arterial Life Cycle Program (ALCP) projects on March 19, noting the program is nearing completion but that several major segments experienced substantial cost increases.
The ALCP work is funded primarily by the regional Prop 400 sales tax (administered by the Maricopa Association of Governments), which typically pays 70% of eligible costs; the city provides roughly 30% local match. Nathan said the program has delivered dozens of arterial upgrades since 2005 and that, as of the fall of 2024, about 74% of the ALCP was complete; staff expects to be at about 83% by 2026.
Staff reviewed recent project budget increases and causes: - Raintree/Scottsdale/Hayden project: initial approved budget ~ $19.3 million; total approved budget rose to about $39 million (stormwater and other factors and final construction accounting noted by staff). There was a modest leftover balance staff expects to apply to future ALCP work. - Pima Road (Pinnacle Peak to Happy Valley): originally programmed near $22 million; final project cost reached about $50 million. Nathan said a large drainage/channel work component and associated stormwater funding accounted for much of that rise. - Pima Road (Happy Valley to Alma School): increased from roughly $12 million to $37 million for similar reasons (stormwater, right-of-way, and inflation). - Jomax/Scottsdale segment (under construction): increased from roughly $23 million to $43 million; staff cited utility conflicts (notably APS relocations), stormwater and right-of-way as drivers.
Nathan told the commission that the regionwide cost surge on roadway work is not unique to Scottsdale: MAG data presented to the group showed steep price increases since 2020 in earthwork, concrete, drainage and asphalt — categories that substantially raise the cost of arterial reconstruction.
Staff said the city seeks non-general-fund offsets where appropriate: stormwater fees, flood-control district funds and developer or tribal contributions (the presentation cited SRPMIC funding for a nearby alignment) have been used to reduce pressure on the local match. Nathan also said MAG and ADOT remain partners on specific interchange and arterial projects.
Commissioners asked whether Prop 400's regional pool and the city's 0.1% matching tax would generate the local match required; staff said the program is reaching its end of collection but MAG is allowing projects to be completed using previously committed funds. Staff committed to bring additional design and cost-assessment work on the remaining segments (for example, Los Piedras, Stagecoach to Cave Creek and Carefree Highway segments) before major construction funding requests.
Why this matters: ALCP projects are major arterial investments with substantial right-of-way, drainage and utility complexity; rising costs for earthwork and drainage can significantly increase local matching requirements and pressure capital budgets. Commissioners asked for more detailed design-phase cost estimates on remaining segments to clarify local budget exposure.
Evidence: staff presentation slides, project-level budget change tables and MAG cost-trend figures shown to the commission.
