Page 316 - Ord 866 Adopting a revised Fiscal Year 17-18 and new proposed Fiscal Year 18-19 budget

Section 10 Capital Improvement Plan
CIP Overview

CAPITAL ASSETS BY CATEGORY AND TYPE
When most people think of the Town’ s capital assets, they naturally think of the Westlake Academy
campus. While the campus is certainly a very important and visible asset owned by the Town, it is
but one of many. Included in the assets of the Town are all the Town’ s infrastructure such as its
streets, water, water towers, and sewer mains, vehicles and other equipment. In preparing this year’ s
CIP, the staff utilized our annual audit to determine the value of the Town’ s assets.

FUNDING CONSIDERATIONS
In all communities, the cost associated with capital projects far outweighs the available resources
necessary to pay for them; in short there is not enough money. This requires prioritization of the
projects based upon their perceived impact on the community.
Due to the vast number of individual desires it is near impossible to satisfy everyone and requires a
collaborative effort to create situations where the benefits are shared equitably with community
stakeholders. In addition, dedicated revenues will, in most cases, determine which projects get
funded. For example, the Utility Fund may only contribute towards capital projects that improve
water and wastewater projects.

SOURCES OF FUNDING
There are four primary funding sources for capital improvements:
1. Cash Funding ( revenue sources such as sales, hotel/ motel and property taxes)
2. State/ Federal funding ( public grants)
3. Private Funding ( developmental impact fees or charitable donations)
4. Bond Issuance

The projects in this CIP rely on bond proceeds and other revenues in the Governmental and
Enterprise Funds as well as contributions from corporate partners for funding.
There are two types of bonds:
1. General Obligation ( GO) bonds which require voter approval
2. Certificates of Obligation ( CO) bonds which do not require voter approval.

HOW INFLATION IMPACTS THE CIP
Inflation is defined as a rise in the price of all goods and services over time. This implies that the
purchasing power, or value, of currency will decline in the future relative to costs. Therefore, more
money will be required to fund CIP related expenditures and must be accounted for.

This data is important in calculating the Town’ s future liability; by utilizing inflation trends to calculate
future capital replacement costs, we can determine how ‘ waiting’ a year or more impacts the total
project cost. Most are aware of the benefits of compounding when it comes to investing.
Unfortunately, this same principle works in reverse as inflation causes costs to compound higher over
time.

FUNDED VS UNFUNDED ( UNDER DISCUSSION) CAPITAL IMPROVEMENTS
In prior years, the majority of capital improvements in Westlake have been unfunded. These projects
represent capital needs that are subject to more discussion and are included to convey to the Town
leaders and other interested parties the general parameters and breadth of those capital needs.
These projects may be moved to the “ Funded” section of this CIP or moved out into future years
depending on priorities, funding availability, and other considerations. This multi-year capital plan will
provide Council with a guide that communicates the program need or deficiency, as well as the
funding requirements. It is important to note that projects which do not receive funding in a given
year are moved out to the future years in order to communicate to those with decision making
responsibility the need to provide necessary funding, or through evaluation, eliminate the project
entirely.

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