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HomeMy Public PortalAbout620.1 - Business and Financial Services - Management & Budget - Capital Improvement ProgramManagement, Budget & Accounting Department Management & Budget Section 620.1 620.1 SUBJECT: CAPITAL IMPROVEMENT PROGRAM :1 OBJECTIVE: Identify and program on an annual basis the immediate and projected needs of the City over a continuing five-year period. :2 AUTHORITY: This procedure amended by City Council May 3, 2004, Item A1. :3 DIRECTION: The Management, Budget & Accounting Director, as an appointed official, serves at the pleasure of, and receives direction from the Mayor or the Mayor’s Designee. :4 FUNCTIONS: Overview of the Capital Improvement Program process including its link to comprehensive planning, responsibilities and calendar. A. Introduction The Capital Improvement Program (CIP) is a five-year plan for the City's major projects and expenditures that is reviewed and revised annually. The CIP lists each proposed capital project, the year it is expected to be started, the amount expected to be expended in each year of the program, the proposed method of financing these expenditures, and the department priority for each project. The first year of the CIP is enacted annually as the fiscal year's capital budget. With each annual update, the preceding fiscal year is deleted from the program and a fifth year added. Each year a program is prepared by staff in accordance with goals and policies of the Growth Management Plan (GMP). The Municipal Planning Board (MPB) also reviews and evaluates the program for consistency with the GMP. Policies and Procedures Manual Page 1 Management, Budget & Accounting Department Management & Budget Section 620.1 B. Comprehensive Planning and Capital Programming Under the provisions of the "Local Government Comprehensive Planning Act of 1975," Section 163.3161 et seq., Florida Statutes, the City's GMP provides the framework within which all development actions should occur. The CIP is an important tool for implementing the City's GMP. Along with the Land Development Code, it bridges the gap between the day-to-day operations of City government and the City's long-range development goals. The capital improvement programming process gives the community an opportunity to review overall development goals annually. NOTE: The above-referenced Legislation was revised in 1985 and is now known as the "Local Government Comprehensive Planning and Land Development Regulation Act." Among other things, Section 163.3177 et seq, requires the City to incorporate a Capital Improvements Element (CIE) into the GMP. This element must be consistent with the other elements of the GMP and be reviewed and revised annually. Preparation of this element will require a comprehensive analysis of current and future public facility needs and identification of capital projects and funding sources to meet these needs. Projects that are included in the CIE are also included in the CIP; however, to change any project in the CIE requires an amendment to the City's GMP. Consequently, CIE projects that are included in the CIP represent a five-year funding commitment through the GMP unless there is an amendment to the Plan. C. Capital Improvement Program Process 1. Only projects that meet the definition of a capital improvement are included in the CIP. Capital improvements are defined as physical assets, constructed or purchased, that have a minimum useful life of three (3) years and a minimum cost of $100,000. Normal replacement of vehicles or equipment and normal recurring renovation costing less that $100,000 are not included in the CIP. Examples of typical capital improvements are: a) New and expanded physical facilities for the community of relatively large size, and over the $100,000 threshold; b) Large scale rehabilitation or replacement of existing facilities; c) Major pieces of equipment which are expensive and have a relatively long period of usefulness; d) The cost of engineering or architectural studies and services relative to the improvement; and e) The acquisition of land for a community facility such as a park, highway, sewer line, etc. 2. Each year, the Program is prepared from project requests submitted to Management, Budget and Accounting by the various departments and agencies of the City. The forms require a project description, justification, cost estimates, statement of impact on the City's annual operating budget, implementation schedule and indications of project location and service area. Concurrently with the preparation of the project requests, information Policies and Procedures Manual Page 2 Management, Budget & Accounting Department Management & Budget Section 620.1 concerning the City's financial resources is obtained with the assistance of the Accounting and Control Division. 3. After compilation of the requests, projects are reviewed by staff from Management, Budget, and Accounting, the Economic Development Department and the Mayor. This review, along with available funding, forms the basis of the program recommended by Management, Budget, and Accounting staff to the City Council. Following evaluation by the Economic Development Department, the MPB evaluates the program for compliance with the GMP. 4. The recommended program is then used by City Council in the development of the annual operating budget which becomes effective October 1st of each year. The first year of the five-year program reflects the Capital Budget with the following four years becoming the CIP. The CIP is adopted by City Council along with the adoption of the annual operating budget, without commitment to expenditures or appropriations beyond the first year, except for those capital improvements programmed in the CIE. Projects programmed in the five-year CIE have a commitment for funding for the five-year period through the adopted GMP. The CIE is a five-year program that is updated annually through the CIP process and can be amended twice a year through the GMP amendment process. D. Responsibilities in Program Preparation 1. Operating Departments, Boards, and Agencies It is the responsibility of department directors, boards, or agencies with plans requiring funds for capital improvement projects during the forthcoming five- year period, to initiate project requests annually, formulated into a program that states the City's need for each project, as well as its relative importance in the department's program. 2. Chief Financial Officer/Accounting and Control Division Provides information on proprietary funds, primarily with regard to their bonding potential and debt management. Also provides some revenue forecasts and assists in the review and evaluation of project financing when requested. 3. Economic Development Department The Economic Development Department has the following responsibilities in the capital programming process: a) Review and evaluate all requests concerning the CIE of the GMP and submit to MPB and City Council any amendment to the CIE that impacts the CIP; b) Assist and provide information to Management, Budget, and Accounting in the review and evaluation of project submissions and c) Make a recommendation to the MPB regarding the consistency of the CIP with the GMP. 4. Management, Budget and Accounting Management, Budget, and Accounting has the following responsibilities in the capital programming process: Policies and Procedures Manual Page 3 Management, Budget & Accounting Department Management & Budget Section 620.1 a) Prepare the CIP calendar; b) Provide information concerning the City’s financial resources; c) Prepare and distribute the package used by departments and agencies submitting requests; d) Provide assistance to departments and agencies in the preparation of requests; e) Receive, review, and coordinate all requests; f) Provide staff assistance to the Economic Development Department in the formulation of their recommendation to the MPB regarding the consistency of the program with the GMP; g) Provide assistance in preparing the City Council adopted program; and h) Publish and distribute the adopted program. 5. MayorThe Mayor or the Mayor’s designee is responsible for final review of the proposed CIP before submission to the City Council. This review primarily includes the projects to be funded from the CIP and Gas Tax Funds, the most competitive funding sources. 6. Municipal Planning Board Per Section 65.143 of the City Code, the Board is to evaluate the recommended program for compliance with the GMP, and if found to be in compliance to them, recommend the program for City Council approval. 7. City Council Finalize and adopt the five-year CIP along with the City's annual budget with the first year of the program as that fiscal year's capital budget. E. Department Ranking 1. Each project appearing in the five-year program carries a department priority recommendation. This ranking is assigned by the submitting department or agency and reflects the relative importance of the individual project to that particular department's total program. 2. Departments submit projects in order of their priority, by type of service, prefixed with the following designations which describe the project's intent: a) Critical Deficiency – Required to eliminate proven or obvious dangers to public or employee health or safety; b) Existing Deficiency – Needed to raise a service or facility to an adopted level of service; c) Repair/Replacement – Maintains adopted service level standards in developed areas and gives comparable service standards in developing areas; and d) Future Need/Planned Expansion – Enables the City to provide service required for scheduled development. F. Project Numbering Policies and Procedures Manual Page 4 Management, Budget & Accounting Department Management & Budget Section 620.1 1. The CIP project number is a three-part, eight-digit number. The first two digits indicate the year in which a project was originally submitted for inclusion in the program. The remaining six digits are the three-digit program number of the requesting program, followed by three digits indicating the number of projects submitted by a program for the fiscal year. 2. A project retains the original number throughout itsexistence, with that number permanently retired when a project is completed or deleted from the program. 3. The "Financial Project Number" indicates a project's JD Edwards four or seven digit project number. When assigned, it allows tracking and cross- referencing a project with the City's financial system. G. Annual Update Status Report Each year the CIP is updated to include a new five-year program and evaluated to determine the status of projects funded in prior years. Project information is revised and/or updated each year based on current information. Projects fall into one of six categories when the update occurs. The six categories shown on the status reports are as follows: Completed, Continuous, Funded, Partially Funded, Deferred, or Deleted. H. General Calendar INSERT CALENDAR HERE :5 FORMS: None. :6 COMMITTEE RESPONSIBILITIES: None. :7 REFERENCE: Procedure adopted by City Councl asSection 240.6 on November 1, 1971, item 24; amended October 6, 1975, Item 35; amended April 7, 1986, Item 17A4; renumbered from 225.1 and amended December 9, 1991, Item 6/NN; amended June 1, 1992, Item 3/P; amended December 16, 1996, item 7 PP; amended January 24, 2000, item 4LL; amended May 3, 2004, Item A1. :8 EFFECTIVE DATE: This procedure effective May 3, 2004. Policies and Procedures Manual Page 5