Xcel Energy crews move utility lines prior to road work that began in late April on Hwy. 60/Fourth Street. Council members on Monday expressed frustration that limited funding has hampered the city’s ability to make needed road repairs. (Daily News file photo)

The Faribault City Council continued its weekly review of the proposed 2020 budget and levy Tuesday with a review of the street improvement and equipment upgrade sections of the Capital Improvement Plan.

With the Highway 60/Fourth Street improvement project, the city has not only used up its entire state aid budget but has gone well into the red. The city receives an annual allowance of $1 million from the state aid highway fund, the Highway 60 reconstruction has used $2.2 million in state aid funding.

As a result, the city has been forced to trim its highway improvement plans to address only the most pressing projects, according to City Engineer Mark DuChene. Councilors were broadly supportive of the street improvement plans DuChene presented at Tuesday’s work session, although Mayor Kevin Voracek and others lamented the lack of progress on other roads in need of improvement, such as Eighth Street SW near Faribault High School and South Central College.

DuChene noted that the city’s limited budget had forced difficult decisions regarding project prioritization. Even those plans which were funded were not scheduled as soon as the Engineering Department would like, DuChene said. For example, the plan did include a reconstruction project for 10th Street SW from Ninth Ave SW to Prairie Ave, among the city’s most needed, but not until 2022.

The city’s proposed highway budget for the next two years includes significant improvements to downtown roads including a reconstruction of Division Street from First Avenue NE to First Avenue NW in front of the library, in conjunction with the library’s plans for a parking lot expansion and interior improvements. The city also hopes to extend the adjacent block of Central Avenue (in front of the Cenex co-op).

Other reconstruction plans for 2020 include the portion of Second Street just two blocks to the south, from First Ave NW to Willow Street and the easternmost block of 20th St NW in northern Faribault. In 2021, the city will reconstruct two more blocks of Division Street to the west of the library, as part of its efforts to deal with the short Second Avenue bridge over Division Street.

The city’s street overlay project schedule is significantly more ambitious. In 2020, the focus will be on west Faribault between the train tracks and Lyndale Avenue, including Hulett, Irving, Lincoln, Franklin and Cross avenues. Whipple Way and Littleford Lane near Shattuck-St. Marys School in northeast Faribault. In 2021 the city will overlay Fifth and Sixth Avenue from Highway 60 to Seventh Street NW, and Third Street from Fifth Street NW to Seventh Street NW and an area near Batchelder Park in northeast Faribault, including Cardinal Avnuee, Forest Lane and Woodhurst Drive.

City Administrator Tim Murray offered the city’s capital replacement fund, which primarily pays to replace vehicle for city departments, including police and fire. Murray emphasized that the city is doing what it can to hold onto older vehicles as long as possible and minimize the city’s vehicle needs. He highlighted the efforts of the Community and Economic Development Department to move from three vehicles to two.

“This mindset where every employee has an assigned vehicle, we need to move away from that” Murray noted.

Councilor Royal Ross and others emphasized the importance of holding onto the city’s vehicle fleet for as long as possible. Aside from Police Department vehicles, many of the city’s vehicles are older but have accumulated relatively few miles over the years.

“I’d like to try to make Faribault a better place for citizens and do what we can with the vehicles we have,” said Ross.

Franchise fees

Murray also presented the city report on franchise fees. The city estimates that it will receive over $900,000 in fees from gas and electric bills. The city approved a modest increase in franchise fees to help fund park developments. Murray has expressed dissatisfaction that several city parks have remained undeveloped due to lack of funds.

The city also currently receives more than $250,000 in franchise fees from cable television providers. However, city officials fear that this revenue could be significantly cut or eliminated entirely due to a ruling from the Federal Communications Commission.

On Aug. 1, the FCC ruled that fair market value of non-monetary provisions could be calculated in the 5% franchise fee that cities can charge to cable TV providers. This means that the fair market value of the city’s community access TV station will be deducted from the royalties the city receives. The fair market value of the station will be based on the amount the cable companies typically charge customers.

In order to mitigate the loss of revenue, Mayor Voracek suggested that the council consider adding a streetlight fee. While other cities have begun implementing street light fees to offset the significant costs of street light maintenance, Faribault has thus far resisted the trend.”

“I don’t want to add an extra fee to anyone, but if the cable TV fee goes away, I’d like to consider it,” Voracek said.

Ross and Councilor Jana Viscomi argued that that adding franchise fees to currently untaxed entities could be an equitable way to replace the revenue potentially lost to the cable companies.

“I like franchise fees because it generates revenue from entities that would otherwise not be taxed,” said Ross. “That helps keep everything else down.”

The council will meet next week for another work session as it continues to go through the 2020 budget process. The council is expected to have a detailed budget plan by the end of September when it approves the preliminary 2020 levy.

Reach Reporter Andrew Deziel at 507-333-3129 or follow him on Twitter @FDNandrew.

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