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CC 2024-01-23_12.a. Pavement Priotiy Project List_2024Item 12.a. MEMORANDUM TO: City Council FROM: Bill Robeson, Assistant City Manager/Public Works Director BY: Shannon Sweeney, City Engineer SUBJECT: Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 DATE: January 23, 2024 SUMMARY OF ACTION: Review and approve a priority list of streets to include in the 2024 Pavement Management Program (PMP) and find that action exempt under CEQA 15301. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: Budgeted funds of $5,785,753 are available for the PMP budget in FY 2024-25. See Table 1 for revenue sources. Table 2 lists the expected expenditure breakdown assuming that the final budget for this project is limited to only the existing budgeted funds. Additional funds may become available for this project as e xisting streets projects finish and a reserve fund policy is developed. Sufficient funds exist at this time to complete the top three projects listed in Table 3. City staff is requesting the City Council authorize the City Manager or their designee with the ability include additional pavement maintenance elements to maximize the project size and cost efficiency if more funds become available. Table 1 – PMP Budget Revenue Source FY 2024-25 Budget FY 2024-25 Carryover 2024 PMP Project Total General Fund 2,360,000 (0) 2,360,000 SB 1 450,000 (0) 450,000 Sales Tax Fund 2,062,870 556,135 2,619,005 CDBG 60,000 56,749 116,749 Sidewalk Sales Tax Fund 240,000 - 240,000 Total 5,172,870 612,883 5,785,753 Page 50 of 56 Item 12.a. City Council Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 January 23, 2024 Page 2 Table 2 – FY 2024-25 PMP Expected Expenditure Breakdown RECOMMENDATION: 1) Review and approve a priority list of streets for the 2024 Pavement Management Program; 2) Authorize the City Manager or designee to choose the remaining projects on the list to maximize the project size and cost efficiency of more funds become available, along with other minor work associated with pavement maintenance, such as striping, concrete work, and pedestrian improvements; and 3) Find this project is categorically exempt from the California Environmental Quality Act (“CEQA”) under the Class 2 exemption, which applies to the replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced. (State CEQA Guidelines, § 15301.) BACKGROUND: The City of Arroyo Grande is responsible for over 73 miles of streets within its boundaries. On February 14, 2017, the City Council adopted the 2016 Update to the Pavement Management Plan (PMP) and endorsed the “Critical Point Strategy” (CPS) methodology for the City’s Pavement Management System (PMS). The CPS approach selects the road segments for repair or resurfacing that are at a “critical point” of deterioration. The critical point is a point located on the pavement deterioration graph that indicates a more expensive maintenance or rehabilitation approach will be needed in the near future. The focused critical point strategy makes sense when the City has minimal funding and does not have the latitude to consider other project efficiencies like economies of scale, project competitiveness, and project management. Since the adoption of the 2016 PMP and until 2022, the City applied approximately $1.25 million per year to streets maintenance and repair. Expenditures FY 2024-25 Budget Construction 4,790,230 Construction - Public Works 100,000 Construction Contingencies 479,023 Contract Admin 22,500 Testing 40,000 Design/Survey 350,000 Studies 4,000 Total 5,785,753 Page 51 of 56 Item 12.a. City Council Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 January 23, 2024 Page 3 On April 26, 2022, the City Council adopted the 2022 PMP. The plan identifies recommended street work assuming a continued annual budget of $1.25 million per year and applying the CPS. On November 22, 2022, City Council approved maintenance and repair work for the 2022 PMP. More than the base amount of $1.25 million was available due to prudent financial stewardship, carryover, and excess reserves. As a result, the City was able to complete additional work, including an overlay of the entire Equestrian Way neighborhood that had not previously been identified for upcoming (within the 10 year planning horizon) repair in the 2022 PMP but that had significantly deteriorated asphalt. ANALYSIS OF ISSUES: On May 23, 2023, the City Council directed staff to apply $3 million from excess reserves in addition to the base amount of $1.25 million to pavement maintenance and repair. Staff value engineered the information available in the 2022 PMP to provide a recommended list of work to be done with available funds. In addition to CPS, staff considered other factors, including the cost efficiency of applying only one kind of maintenance treatment, the management and staging efficiency of focusing on locations on a neighborhood-basis rather than a single street-basis, economies of scale that arise as a result of one large single project rather than multiple small ones, and the bidding competitiveness that occurs when the City bids a larger project. To better align the magnitude of the upcoming pavement project with existing and future potential available funds, City staff secured a contractor at the end of 2023 to perform deflection testing at various locations throughout the city. Testing locations were identified using the map shown in Figure 1. Note that Leisure Gardens and Sunrise Terrace were removed from consideration because they are private streets. The Equestrian Way neighborhood is crossed out because pavement maintenance was completed in 2023. The remaining locations were identified because there is a significant grouping of deteriorating streets within neighborhoods that appeared to be candidates that may benefit from the same pavement treatment. The deflection testing indicated that all locations were appropriate for an overlay treatment except for Station Way and a large part of the Woodland neighborhood. Results of testing in both locations indicated the need for heavy rehabilitation in the form of full depth reclamation. The cost estimates reflect the treatment recommended based on deflection testing. At this time, City staff does not anticipate that a streets project of this magnitude in size or budget will be possible in future years without an infusion of additional revenue that can be allocated to PMP projects. Funding for upcoming years is likely to revert to and be limited to $1.25 million plus any remaining carryover from previous years’ projects. Page 52 of 56 Item 12.a. City Council Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 January 23, 2024 Page 4 This year, City staff is recommending that Community Development Block Grant (CDBG) and sidewalk funds be applied to the same project as the street funds. As seen in Table 3, an estimated $1,308,000 of this project will be dedicated to curb ramp improvements. Applying street and sidewalk funding together will create a more cost-effective project. Figure 1 – Testing Locations Table 3 contains the recommended priority for streets work for FY 2024 -25. The total cost estimate column includes all facets of project costs including design, inspection, and construction. The top three locations can be funded within the existing available funding for FY 2024-25. City staff requests the latitude to base the next location on the list to maximize the use of available funding. For instance, if $3 million is available, Woodland Page 53 of 56 Item 12.a. City Council Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 January 23, 2024 Page 5 should be considered next, whereas if only $1 million available, Station Way would be next. If the Council approves the PMP, staff will move forward with completion of the Plans, Specifications, and Estimate (PS&E) and return to Council in early 202 4 with a request to approve the PS&E and authorize solicitation of bids. Once bids are received and reviewed, staff will present Council with a Bid Award recommendation in winter of 202 4. Construction is anticipated to begin in Spring of 202 5 and is estimated to be completed by the end of 2025. Table 3 – Recommended Priority List ALTERNATIVES: 1. Approve staff’s recommendation that the City Council review and approve a priority list of streets for the 2024 Pavement Management Program and authorize the City Manager or designee to choose the remaining projects on the list to maximize the project size and cost efficiency if more funds become available, along with other minor work associated with pavement maintenance, such as striping, concrete work, and pedestrian improvements, and find the action exempt from CEQA pursuant to CEQA Guideline Section 15301; 2. Do not approve staff’s recommendation; 3. Modify staff’s recommendation; or 4. Provide other direction to staff. ADVANTAGES: The recommended list adheres to the concept of CPS in that projects are prioritized in order of the savings they provide. The top three recommended locations, the Stagecoach neighborhood, Rancho Grande Phase 1, and the Brighton neighborhood, provide Cost Based Cost Based Total Cost Cumulative Savings on PMP on Testing Estimated Cost from PMP Stagecoach $5,658,000 $2,266,000 44 $528,000 $2,794,000 $2,794,000 $2,864,000 Rancho Grande Ph 1 $2,874,000 $1,319,000 10 $120,000 $1,439,000 $4,233,000 $1,435,000 Brighton $2,518,000 $1,133,000 20 $240,000 $1,373,000 $5,606,000 $1,145,000 Station Wy $953,000 $664,000 4 $48,000 $712,000 $6,318,000 $241,000 Andre Dr $687,000 $395,000 8 $96,000 $491,000 $6,809,000 $196,000 Woodland $2,583,000 $2,317,000 20 $240,000 $2,557,000 $9,366,000 $26,000 Via La Barranca $649,000 $698,000 3 $36,000 $734,000 $10,100,000 -$85,000 I $15,922,000 $8,792,000 109 $1,308,000 $10,100,000 $10,100,000 $5,822,000 Cost of Curb RampsLocation# of Curb Ramps Page 54 of 56 Item 12.a. City Council Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 January 23, 2024 Page 6 significant savings by applying an overlay now rather than waiting until rehabilitation is necessary. Savings to the City by performing this work now are estimated to be $5,444,000. The total cost of proceeding with pavement maintenance in these three neighborhoods is estimated at $5,606,000, which is within the existing available b udget of $5,785,753. This is a sizable project that will take advantage of economies of scale. The top three projects involve only overlay, which reduces the number of subcontractors needed to complete the job and leads to further savings. The projects are grouped by neighborhood to facilitate encroachment permits and traffic control plans. All th e work identified can be bid efficiently as a single project rather than multiple small projects. Finally, the size of this project makes it appealing to more potential bidders, which provides greater competitiveness. Average citywide PCI will rise, as the PCI for all of the streets recommended for treatment are below the 2022 average of 56. DISADVANTAGES: Restructuring the program this year to maximize the use of available funding by focusing on a specific treatment type means that some maintenance work previously identified in the 2022 PMP will be deferred for one or more years so that each year’s project maximizes a single treatment application. City staff conferred with the pavement consultant to verify that doing so should not result in additional future treatments for these streets because of the deferment. ENVIRONMENTAL REVIEW: The project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guideline Section 15301 covering the repair and maintenance of existing streets, sidewalks, gutters and similar facilities. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Page 55 of 56 MEMORANDUM TO: City Council FROM: Shannon Sweeney, City Engineer SUBJECT: Supplemental Information Agenda Item 12.a. – January 23, 2024 City Council Meeting Consideration of the 2024 Pavement Priority Project List and Finding the Project is Not Subject to Environmental Review Under the California Environmental Quality Act, State Guidelines Section 15301 DATE: January 19, 2024 There was an error in the dates listed in paragraph 2 of page 5 in the staff report. This has been corrected and should read as follows: If the Council approves the PMP, staff will move forward with completion of the Plans, Specifications, and Estimate (PS&E) and return to Council in early 2024 with a request to approve the PS&E and authorize solicitation of bids. Once bids are received and reviewed, staff will present Council with a Bid Award recommendation in winter of 2024. Construction is anticipated to begin in Spring of 2025 and is estimated to be completed by the end of 2025. cc: City Manager Assistant City Manager/Public Works Director City Attorney City Clerk City Website and Public Review Binder Enc Page 56 of 56