A Message from City Hall: Budget and Bond Decisions Ahead

Happy 2022 to everybody. Let’s hope that we can find some semblance of normal this year. 

The city council will be holding public hearings about the annual budget and proposed bonds on Jan. 12 and Thursday, Jan. 20 (note the Thursday rather than the usual Wednesday). The final budget must be adopted on Jan. 20 for inclusion on the March 1 Town Meeting ballot. 

This month’s article will focus on proposals to address long-standing infrastructure needs. Next month will focus on the full operating budget.

The city is proposing four bonds:

1. $16,400,000 from the Sewer Fund for improvements to the Water Resource Recovery Facility (known by many as the Sewer Treatment Plant). 

Our recent upgrade modernized the plant, made it energy efficient, and created the ability to accept and process commercial organic (food) waste, which generates revenue. This new process resulted in increased methane production to meet all of the plant’s heating needs. 

Two resulting issues are increased odor and use of excess methane. Many have noticed much stronger smells coming from the plant, to the point where the state has issued a correction order. Odor control technology is included in this project. The primary function is to use methane to dry residuals — known as biosolids or “sludge.” This will greatly reduce the number of costly and environmentally unfriendly truck trips between Montpelier and Coventry. 

2. $7,200,000 for East State Street ($4,000,000 from the General Fund, $3,200,000 from Water/Sewer Funds). 

Project includes complete reconstruction of East State Street from Main Street to College Street. New water and sewer lines will be installed underground. A rebuilt road base and surface as well as improved sidewalks will be installed above. A sewer overflow (CSO) issue will be corrected by installation of a new stormwater outfall. The Blanchard parking lot behind the Fire Station will also be improved. This project will also correct the periodic odor problem at the East State and Main intersection. Funding for the project is aided by a $1,420,000 ARPA grant.

3. $1,815,000 from the General Fund for a group of infrastructure projects. 

These projects have been in various planning and design phases in recent years. They include:

• $600,000 for Confluence Park. This money will match grant and private funds for construction of the long-planned park next to the bike path and Transit Center at the confluence of the Winooski and North Branch rivers.
• $550,000 for the Main Street and Barre Street Intersection. As per the approved Main Street Corridor Plan, a new traffic light will be installed along with physical alterations. This new “smart” signal light will be coordinated with traffic lights at the Main/Northfield and Main/State systems to better manage traffic flow.
• $250,000 for Street Lighting upgrades. Downtown street lights will be converted to LED lighting. This has the double benefit of reducing energy use and electrical costs while improving lighting quality. The city’s current street lights have passed their useful life and have regular failures. The new lights are projected to pay for themselves with energy savings over the life of the bond.
• $250,000 for a Pellet Heating System at the DPW Garage. This was identified as the top priority building improvement project in the city’s Net Zero Energy plan. It will replace the oil-fueled heating system with a wood pellet system.
• $165,000 for Marvin Street Slope Repair. There is a significant slope failure on Marvin Street which is putting the roadway at risk. 

4. $1,500,000 to purchase the current Elks Club property for future recreation use. 

The city will buy this parcel and create a new recreation center. This may be done in conjunction with private investment for some facilities. The size of the parcel provides ample parking and ample opportunity for trails and fields. 

The city’s Recreation Center on Barre Street has significant problems including lack of accessibility, terrible HVAC systems, and asbestos throughout. Renovating this building for modern recreation use will cost at least $6 million while retaining the existing footprint restrictions and lack of parking. A potential recreation center at the Elm Street Rec complex (pool/fields/courts) also has size restrictions and competes with the existing facilities for space and parking. 

Required first year payments for the proposed bonds have already been built into the full budget.

In addition to bonds, the council is allocating approximately $2.5 million in one-time funding for infrastructure and capital expenses. 

The first $1.1 million in federal ARPA (American Recovery Plan Act) funding qualifies as lost revenue is being allocated to infrastructure projects and equipment purchases which had been approved in the FY20 and FY21 budgets but deferred due to revenue losses. Approximately $600,000 is being allocated for road and retaining wall work. Approximately $400,000 is being allocated for delayed equipment replacement, with the balance restoring funding to the Housing Trust fund and some smaller efforts.

The second $1.1 million in ARPA money is being allocated to eligible activities within the funding guidelines. This is currently planned as $75,000 for community outreach, $425,000 for homelessness issues, including a potential public bathroom facility, $50,000 for an electric vehicle charging station for municipal vehicles, and $450,000 for water/sewer infrastructure upgrades.

The city also has $435,000 in money reserved from prior budgets for capital projects and expenses. These funds were held as a hedge against more substantial revenue losses. The money is being allocated, with $180,000 being added to budgeted paving money to finally reach the targeted funding level to achieve and maintain proper road conditions over the long run. Another $221,000 is being allocated for equipment purchases. The remaining $34,000 is to study possible removal of dams in the Winooski and North Branch rivers.

The emphasis on capital funding doesn’t end with these items. The annual capital budget was reduced drastically in the last couple of years due to the revenue crisis. The proposed budget would restore $223,500 to the capital plan with another $225,000 needed in FY24 to return to full funding level.

Any potential projects resulting from the new federal infrastructure bill are not included since those guidelines have not yet been issued.

Thank you for reading this article and for your interest in Montpelier city government. Please feel free to contact me at wfraser@montpelier-vt.org or 802-223-9502 with any questions, comments or concerns.