25LINKBUDGET(FULL) - Flipbook - Page 106
City of Plymouth 2024 / 2025 Budget
1.
New construction projects for additional facilities such as streets, sewers,
buildings and parks. This is the major part of the program for rapidly
developing communities, in which the capital infrastructure is continually
being expanded into new areas as development occurs. Some examples
include extending streets and sewers into new areas, constructing new branch
libraries and recreation facilities, and building new highways within the
existing street system.
2.
Expansion projects for existing facilities such as streets, sewers, buildings and
parks. This is a typical part of the program for developed communities, and also
in the older sections of rapidly developing communities, where facilities have
been built in general, but have been outgrown by the population and traffic
growth. Some examples include widening streets, adding turn lanes and traffic
control devices, enlarging the capacity of a section of the existing sewer
system, and enlarging the main library.
3.
Maintenance, renovation and replacement projects for existing facilities
such as streets, sewers, buildings and parks. This is the major part of the
program for older, fully developed communities. Some examples include
repaving streets, rebuilding deteriorated sewers, and renovating old
buildings.
4.
Major equipment acquisitions such as fire trucks and sewer vactors. These
items are often included in the capital improvements programs of small
communities, because of their high cost, infrequent purchase and need for
multi-year financial planning.
Components of Capital Improvements Planning
Many communities plan for capital improvements on a multi-year basis, but do not project
operating revenues and expenses over the same period and do no correlate the two budgets
on a multi-year basis. This can result in one of two serious problems:
1.
The Capital Improvements Program absorbs revenues needed for
operating expenses: If the community's revenue sources are limited, and a
multi-year capital improvement program is financed by issuing bonds, then the
community can find itself without sufficient revenues to meet normal operating
expenses in addition to the debt payments as the years go by.
2.
Increasing operating expenses prevent the community from meeting the
financing needs of the Capital Improvements Program: If the community's
revenue sources are limited, and a multi-year capital improvement program is
planned on the basis of saving funds for future projects, the community can find
itself unable to set aside the capital reserves, as operating expenses demand
an increasing amount of the limited revenues as the years go by.
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