03.09.23 CC FY2023 CIP Overview — File 23-0271

Capital Investment Plan FY2023 City Council Item ID# 23-0271 Katjana Ballantyne, Mayor Richard E. Raiche, Director of Infrastructure & Asset Management Edward Bean, Director of Finance Michael Mastrobuoni, Budget Director 9 March 2023

Table of Contents • Chapter One – Orientation • Chapter Two – Evolution • Chapter Three – Considerations • Chapter Four – FY2023 Capital Investment Plan • Chapter Five – The Plan & Implementation 2

Orientation Background and table setting for Item ID# 23-0271 3 Chapter One

Capital investments – the companion to the operating budget, equally vital to the delivery of city services 4

City Council authorizes borrowing and accepts grants/loans for each capital investment 5

Capital Investment Plan (CIP) – Regularly updated statement of intent for major, non-recurring expenditures 6

Former CIP spreadsheets – outdated in both form and content 7

Current FY-2023 CIP – Updated investments & new ClearGov portal 8

Opportunity for involvement in the continued evolution of Somerville’s Capital Investment Plan 9

Evolution Ecosystem changes that influence Capital Investments 10 Topics Financial capacity Suite of municipal services Equity Climate change & sustainability Mobility & streetscape Data transparency Chapter Two

Financial capacity 11 Chapter Two Evolution

Tax base expansion 12 0 5,000,000,000 10,000,000,000 15,000,000,000 20,000,000,000 25,000,000,000 Assessed Value Residential Commercial/Industrial

Infrastructure backlog 13 0 20,000 40,000 60,000 80,000 100,000 Municipal Building Square Footage by Year Built / Renovated - (351,000 s.f. total)

Suite of municipal services 14 Chapter Two Evolution

Services expansion 15 FY2013 - $184.9M FY2023 - $307.6M

Equity 16 Chapter Two Evolution

Changing the built environment & technology to promote equity for all 17

Climate change & sustainability 18 Chapter Two Evolution

Changing the built environment to reduce carbon emissions & provide resiliency 19

Mobility & streetscape 20 Chapter Two Evolution

Reprioritization of right-of-way space 21

Data transparency 22 Chapter Two Evolution

Increased engagement 23

Considerations Practical limitations that morph an infinite wish list into a finite CIP 24 Topics Definition of solutions Cost forecasts Prioritization Financial analysis Adaptability Planning horizon Chapter Three

Definition of solutions 25 Chapter Three Considerations

Project lifecycle

Aggregation of investments 27

Cost forecasts 28 Chapter Three Considerations

Adjusting for escalation & standardizing soft costs Construction Escalation Design Added Scope Contingency 29

Prioritization 30 Chapter Three Considerations

Public Health & Safety: Is the project necessary to protect public health and safety? 31

External Obligations: Is the project required to comply with external statutory requirements? 32

Fiscal Prudence: Does the project leverage outside dollars, activate development, or reduce City operating costs? 33

City Services: Does the project enable or enhance the City’s ability to deliver municipal services? 34

Equity: Does the project promote equity for historically underserved residents? 35

Strategic Planning: Does the project advance the goals of accepted strategic plans including SomerVision, Climate Forward, and Vision Zero? 36

Evaluation criteria & application 37

Financial analysis 38 Chapter Three Considerations

Funding sources & eligibility 39

Financial Model: Basics & Assumptions 40

Financial Model: Measures of Fiscal Health 41 Secondary Metrics and Goals Paygo budget of 1.5% of prior year revenue OPEB appropriation >5% of health insurance premium Debt to Expenditure Ratio Debt Service should not take up too much of our operating budget expenditures Target: 8% Currently 4.3% Operating Reserves [Unassigned fund balance] + [general stabilization fund balance] should grow with the operating budget Target: 10-15% PY Revenue Currently 14.26% Operating Budget Surplus Future years should have a projected surplus in order to cushion us from variations (risk mitigation - economic) Target: >3% Historically above

Adaptability 42 Chapter Three Considerations

Continual evolution and adaptation 43

Planning horizon 44 Chapter Three Considerations

5-year plan 45

The FY2023 Capital Investment Plan Enough with the generalizations… what’s actually in the plan?!?! 46 Topics Buildings Parks & Open Space Streetscapes Vehicles, Equipment & Real Estate Chapter Four

Buildings 47 Chapter Four FY23 CIP

Recurring Annual Building Improvements 48

Assembly Square Fire Station Fit Out 49

Fire Station Rehabilitation Program 50

Building Master Plan - 1895 Building • https://www.somervillema.gov/buildingmasterplan 51

Community Center including teen space 52

Pre-K thru 8 School Buildings 53 • Enrollment Study • 2022 –2023 • Gap Analysis & Cost Estimates • 2023 • Feasibility Study & Community Process • 2023 – 2025 • Design & Construction • Starting Fall 2024

Investments not in the FY23 CIP but in the queue for future CIP updates* • Building Master Plan – City Hall • Building Master Plan – Edgerly Building • 1 Franey Road Building & ADA Improvements • 90 Washington Street / Public Safety Building • Armory Renovation & Rehabilitation 54 * non-exhaustive listing

Parks & Open Space 55 Chapter Four FY23 CIP

WestSNS, Healey & Brown Schoolyards 56

Somerville Junction Park 57

Dilboy Auxiliary Fields 58

ArtFarm 59

Central Hill Phase 1B – Restoration of Veterans Monuments 60

217 Somerville Avenue Open Space 61

• Blessing of the Bay • Kennedy School - Front Schoolyard • Osgood Park • Central Hill Campus Phase 2, 3 & 4 62 Investments not in the FY23 CIP but in the queue for future CIP updates* * non-exhaustive listing

Streetscapes 63 Chapter Four FY23 CIP

Annual Resurfacing, Sidewalks & ADA 64

Clarendon Hill & PHAB 65

SAUSI & Spring Hill Sewer Separation – General Fund Portion 66

Highland Avenue Streetscape 67

West Broadway Vision Zero 68

Boynton Yards 69

• Union Square Plaza & Streetscape • Davis Square Streetscape s • Gilman Square Streetscape s • SHS Gilman Square Elevator 70 Investments not in the FY23 CIP but in the queue for future CIP updates* * non-exhaustive listing

Vehicles, Equipment & Real Estate Chapter Four FY23 CIP

Investments • Recurring - DPW Vehicles • Recurring - Fire Apparatus Replacement • ERATE SPS Network Infrastructure Upgrade • Public Safety Radio Infrastructure 72

• Snow melters or storage space • DPW Yard 3 • School building WiFi, cell phone extenders 73 Investments not in the FY23 CIP but in the queue for future CIP updates* * non-exhaustive listing

Water & Sewer 74

Separate for Enterprise Funds 75

The Plan & Execution 76 Topics ClearGov Next steps Chapter Five

ClearGov 77 Chapter Five The Plan & Execution

ClearGov Budget Portal – About 78 Annual Operating Budget Capital Investment Plan

ClearGov Budget Portal – Plans 79

ClearGov Budget Portal – Projects 80

Next Steps 81

Somerville leads the way 82

Free cash to stabilization 83

Evolution & adaptability 84

Capital Investment Plan FY2023 City Council Item ID# 23-0271 Katjana Ballantyne, Mayor Richard E. Raiche, Director of Infrastructure & Asset Management Edward Bean, Director of Finance Michael Mastrobuoni, Budget Director 9 March 2023