Title
Public Works Department Capital Improvement Program for Fiscal Years 2025-30
Description
This report provides the Transportation, Infrastructure, and Planning Subcommittee with information on the Public Works Department Capital Improvement Program (CIP) for Fiscal Years (FY) 2025-30.
THIS ITEM IS FOR INFORMATION ONLY.
Report
Summary
Each year, the Public Works Department updates a comprehensive five-year CIP (See Attachment A) to address critical infrastructure, aging equipment, and building needs for solid waste services, facilities management, and fleet services. The five-year preliminary CIP for FY 2025-30 includes authorized funding for capital projects financed with general, special revenue, enterprise, bonds, and capital projects funds. The CIP addresses the most critical capital projects to maintain sustainable infrastructure and ensure operational service capacity for future growth and development.
The business process to evaluate capital projects starts in July of each year for Solid Waste operations and September of each year for the Facilities Management programs. Solid Waste conducts capital planning and an evaluation process to review capital projects for funding authorization. The capital planning rate-setting process is used to develop the Preliminary CIP using a 10-year forecast model.
Five-year project planning is essential for successfully maintaining facilities, critical infrastructure, business systems, and equipment, ensuring effective service delivery and operations. The department has identified capital projects in the Preliminary CIP to support facilities management and infrastructure construction needs at the landfills, transfer stations, and Material Recovery Facilities (MRF).
Solid Waste
The five-year preliminary CIP for the Solid Waste Program is approximately $141.6 million. Capital projects are proposed to maintain environmental compliance and support infrastructure improvements. Solid Waste operating, bonds, capital reserves, grants, and remediation funds are used to finance capital projects. The preliminary CIP includes several large capital projects at the State Route (SR) 85 Landfill, 27th Avenue Transfer Station, and the North Gateway Transfer Station. Other projects are planned to address infrastructure needs at the City's open and closed landfills.
Major Capital Projects include:
• 27th Avenue and North Gateway Transfer Station Infrastructure Improvements
• SR 85 Landfill Infrastructure Improvements and Expansion
• Solid Waste Landfill Gas System Maintenance and Monitoring
• Solid Waste Equipment and Vehicle Replacements
Solid Waste is applying for up to $10 million in grants from the United States Environmental Protection Agency through the Federal Fiscal Year 2024-25 Solid Waste Infrastructure for Recycling Grants for Political Subdivisions of States and Territories. If awarded, grant funding will be used to upgrade the North Gateway Materials Recovery Facility (MRF) and construct utility infrastructure at the Resource Innovation Campus (RIC). The total grant funds applied for will not exceed $5 million for the North Gateway MRF and $5 million for the RIC.
Facilities Management
The five-year preliminary CIP for the Facilities Management Program is approximately $154.7 million and supports the repair and replacement of critical equipment and infrastructure in City-owned facilities maintained by the Public Works Department, including funding for major facilities maintenance, fuel infrastructure improvement, and energy efficiency projects to address infrastructure replacements and rehabilitation work planned at facilities citywide. These projects are funded through general, special revenue, enterprise, bond, and capital projects funds.
Major capital projects include:
• Citywide Facility Rehabilitation
• Citywide Facility Assessments
• Citywide Energy Conservation Projects
• Facility Asset Management System
• Security and Access Control
• Fuel and Infrastructure Improvements
Citywide Facility Rehabilitation
Working with the Budget and Research Department (B&R), Public Works prioritizes capital projects by working with General Fund departments to survey and assess projects eligible for major maintenance funding. Projects submitted by facility assessments or self-identified by partner City departments are evaluated for apparent systems risk or end-of-life conditions. Resiliency of building systems and preservation of existing assets are prioritized. Major projects include the sanitary sewer system and roof drain replacement project at Phoenix Municipal Court, the cooling tower replacement at Phoenix City Hall, and fire life safety projects at various sites citywide.
Citywide Facility Assessments
The citywide facility assessment program conducts formal evaluations of major building systems by third-party engineers to identify necessary system replacements and develop strategies to maximize the asset's life while minimizing the facilities' long-term costs. The department allocates $1,000,000 annually to complete Facilities Site Assessments, and the City spends $500,000 annually to evaluate sites for compliance with the Americans with Disabilities Act.
Citywide Energy Conservation Projects
The Facilities Project and Planning Division Energy Management Section develops and supports projects that provide long-term energy savings in City buildings. Projects such as LED lighting retrofits, building automation, solar, emerging technologies, and energy savings investment-grade audits contribute to the City’s overall sustainability goals.
Facility Asset Management System
To effectively manage approximately 1,500 buildings at 850 sites throughout the City, funds are programmed in the CIP to purchase and implement a Facility Asset Management System to manage existing and newly acquired assets. The system will allow decision-makers to evaluate facility strategies through the ability to forecast budgets proactively, ensure compliance with maintenance schedules, plan and prioritize labor resources, and conduct a strategic evaluation of asset procurement programs. The system will integrate with the existing City accounting program SAP and will provide an intuitive, user-friendly online submission and portfolio to track requests.
Badging System - Security and Access Control
The Public Works Department is managing the replacement of the City's 20-year-old security and access control systems. These systems that manage badge access and security controls will be replaced to maintain current industry standards and security requirements.
Fuel, Infrastructure Improvements, and Electric Vehicles (EV)
The CIP supports citywide fuel infrastructure improvements to manage oil and fuel tanks. The Public Works Department has 26 oil and fuel tanks reaching the 30-year estimated useful life. Additionally, Public Works is diligently working toward the citywide EV goal of 200 vehicles by 2030.
New Projects
As part of the 2023 General Obligation (GO) Bond program, Public Works was approved by B&R for three new projects totaling $25.3 million starting in FY2024-25, which include $10 million for City Facility ADA Improvements, $14 million for Energy and Water Efficiency and Renewable Energy, and $1.3 million for City Facility Vehicle Electrification Stations and will be completed over the next few years.
To account for the upcoming Excise Tax Bond sale, which was approved by Finance, Public Works was authorized by B&R for $15 million in bond funding for the Municipal Court Sanitary Sewer Piping project for FY 2024-25.
Critical Unfunded Project Needs
The Department has ongoing critical projects, including fire safety system deficiencies, roof repairs, mechanical deficiencies, and other critical infrastructure repairs and replacements in the Downtown Corridor, Service Centers, and various buildings. FY 2024-25 projects are moving forward contingent upon procurement capacity limitations.
Also, several fuel and product tanks are reaching the end of their estimated useful life, creating a concern for safety and the environment. These fuel tanks must be replaced to comply with Environment Protection Agency standards. Funding for these projects will be requested through the annual General Fund Facility Major Maintenance Project submittal process for funding evaluation and prioritization.
In collaboration with Water Services, the Public Works Department applied for and received a Water Infrastructure Finance Authority (WIFA) grant. The grant funds will support the installation of cooling tower upgrades, resulting in significant water savings. The project cost is estimated at $3,745,300; WIFA’s award is $2,935,000, and the City’s match is $810,300. The project will occur in FY 2024-25 and FY 2025-26.
The Phoenix City Hall Fire Alarm project, funded by GO bond funds, is substantially complete. A total of $5,000 is estimated to be spent this fiscal year to cover the trailing costs for final inspections. As discussed in the new projects section, Public Works was approved for three new 2023 GO Bond projects totaling $25.3 million starting in FY 2024-25.
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Public Works Department.