CAPITAL IMPROVEMENT PLANNING

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CAPITAL IMPROVEMENT PLANNING

• Sandy Kust
• Midwest Assistance Program

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What is a CIP?

• A policy guide used to identify needed capital
  projects.
• A tool to prioritize major expenditures.

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What is a CIP?

• A plan that can be changed with circumstances to
  meet your particular needs.

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Does my community really need a CIP?
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How do we start?
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Eight key elements of a CIP

• 1. Inventory Analysis
• Inspect the water, wastewater systems. This
  could be done by town staff and Midwest
  Assistance Program staff.

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Eight key elements of a CIP

• 2. Cost Estimates
• Preliminary cost estimates for improvements
  identified by the inventory and analysis are made
  using an estimated budgetary unit process.

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Eight key elements of a CIP
Eight key elements of a CIP

• 3. Funding Analysis
• Research and identification of funding sources
  to finance improvements to the system can be done
  with the help of Midwest Assistance Program.

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Eight key elements of a CIP

• 4. Public Involvement
• Public support of the CIP is an essential
  element of the entire planning process.

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Eight key elements of a CIP

• 5. Adoption of the CIP
• The governing body formally adopts the CIP by
  resolution or ordinance.

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Eight key elements of a CIP

• 6. Secure Funding
• Funding sources may require passing revenue or
  general obligation bonds, obtaining grants or
  loans, raising user fees.

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Eight key elements of a CIP

• 7. Project Construction
• When the money is received, scheduling and
  management of the construction projects may
  proceed.

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Eight key elements of a CIP

• 8. Annual CIP Update
• Cost accounting and reprioritization occurs at
  the annual update stage.

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Now that we have a plan which project comes first?
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Nine criteria points for setting project priority

• 1. Health and Safety Effects
• Projects which protect public health and
  safety should have a very high priority.

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Nine criteria points for setting project priority

• 2. Compliance with State or Federal
  Regulations
• A high priority should be assigned to projects
  which are required by state or federal
  regulations.

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Nine criteria points for setting project priority

• 3. Effects on Local Economic Development
• It is important to set forth a correlation
  between improvements and economic development.

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Nine criteria points for setting project priority

• 4. Reducing Operating and Maintenance (OM)
  Costs
• Any improvements which can reduce operating
  costs should be seriously considered.

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Nine criteria points for setting project priority

• 5. Costs
• The governing body should be provided with
  information concerning both the portion of the
  project costs for which the local government is
  responsible and the portion which will be paid by
  others.

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Nine criteria points for setting project priority

• 6. Civic Pride and Community Livability
• Falling under this category are all
  improvements which would affect the
  environmental, aesthetic or social condition of
  your community.

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Nine criteria points for setting project priority

• 7. Public Support
• It is desirable to place a higher priority on
  projects which have generated a good deal of
  public support.

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Nine criteria points for setting project priority

• 8. Availability of Funds
• If funding is available "right now for one
  project, assign this project a high priority
  ranking.

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Nine criteria points for setting project priority

• 9. Changes in Local Government Revenue
• Infrastructure projects may affect tax
  revenues or service charges. A water or sewer
  extension project may generate additional hook-up
  fees and monthly user charges.

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REFERENCES

• The Capital Improvement Plan
• A Strategic Tool for Planning and Financing
  Public Infrastructure
• Montana Department of Commerce
• March 24, 2008
• Asset Management A Handbook for Small Water
  Systems
• EPA

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Contact

• Sandy Kust, Midwest Assistance Program
• Phone [phone]
• E-mail skust_at_map-inc.org