2. Table of Contents
I. 5 Year Projections.................................................................................................. 2
Projection Graph Comparison of Expenditures and Revenues
Projected Remaining Fund Balance
Projected Operating Position
Debt Schedule Projection
II. Plan Summary........................................................................................................ 4
Proposed Projects:
Implementation Strategy
III. Capital Improvement Plan Description:..............................................................11
IV. Conclusion............................................................................................................16
3. 5 Year Projections
Currently, Parkrose Township has expenditures equal to revenues. As we look forward, projections of trends
show potential for budget overruns if expenses rise. A projection of these trends is outlined below. The charts and
graphs show the projections of increases in expenditures for 3%, 5%, and 7%. Revenues have been projected at 4%
based on previous years.
Projections 3% 5% 7% Increased
Revenue
Projected
Fund
Balance 3%
Projected
Fund
Balance 5%
Projected
Fund
Balance 7%
2013 6023585 6135693 6247802 6089639 1628268 1516160 1404051
2014 6196792 6429978 6667648 6333224 1764700 1419406 1069628
2015 6375196 6738977 7116883 6586553 1976058 1266983 539299
2016 6558952 7063425 7597565 6850016 2267122 1053573 -208251
2017 6748220 7404097 8111894 7124016 2642917 773493 -1196129
*Projected Fund balance reflects addition of $1562214 from 2012 fund balance. Expenditure projections are calculated
with debt service removed before percentage increase.
Projection Graph Comparison of Expenditures and Revenues
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
2013 2014 2015 2016 2017
EXPENDITURES
Expenditures Vs. Revenue
Expenses 3% Expenses 5% Expenses 7% Revenue
4. Projected Remaining Fund Balance
Projected Operating Position
$(1,500,000)
$(1,000,000)
$(500,000)
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
2013 2014 2015 2016 2017
U.S.DOLLARS
Projected Fund Balance
PFB 3%
PFB 5%
PFB7%
Projections Operating Position 3% Operating Position 5% Operating Position 7%
2013 0.989 1.008 1.026
2014 0.978 1.015 1.053
2015 0.968 1.023 1.081
2016 0.958 1.031 1.109
2017 0.947 1.039 1.139
*Calculated by dividing expenditures from revenue.
5. Debt Schedule Projection
Projections Debt Service Outstanding Principal
2013 250000 1600000
2014 250000 1440000
2015 250000 1280000
2016 250000 1120000
2017 250000 960000
*5 year debt schedule reflecting debt service and remaining principal for each
year. Based on $160000 to principal and $90000 to interest each year.
Debt Schedule Term Total Debt Total Principal Total Interest
11 Years 2750000 1760000 990000
*Debt Schedule for 11 years reflects total debt, principal, and interest. Payments will be made of $250000 each years.
Remaining potential debt for the township is $15633821.
Plan Summary
The Parkrose Township has experienced economic success over the last 15 years and the result have allowed
for a prosperous township. Even with relatively low tax rates we have been able to create positive fund balances and
manage all of our expenses and debt obligations. To maintain the beauty and community prosperity, we have determined
that the accumulated fund balance should be utilized for capital improvements that will benefit a variety of areas in the
0.000
0.200
0.400
0.600
0.800
1.000
1.200
2013 2014 2015 2016 2017
POSITION
Operating Position
Operating Position 3% Operating Position 5% Operating Position 7%
6. township. In addition to the fund balance delegation, there will be a short term need to increase taxes to fund large scale
projects. The increase in taxes will allow the township to keep the debt service low, fund a total of 11 projects, and allow
for the increase of property value in the township. The implementation of the plan will occur in stages over the next 5
years.
Proposed Projects
New Communications System for the Police: Estimated Cost $275,000
A federal grant for 20% of this cost. The present police radio system is 18 years old. The new system would consist of
a communications control system in the police department, a repeat transmitter on the highest building in town, and ten
portable walkie-talkies. The communications control system and the transmitter would cost $250,000 and the walkie-
talkies $25,000. The repeat transmitter would be much more powerful than the present one, permitting use of the
portable walkie-talkies throughout the city rather than only within a half-mile radius of the transmitter. The new system
could be installed and operating nine months after order.
Computer System Upgrades: Estimated Cost $95,000
The finance department now has a seven-year-old Burger F9500 microcomputer. This computer is generally not up to
current finance department needs and is antiquated compared to the new computers available today. The finance
director wants to purchase a Burger NT10 network system. The $95,000 cost for the system includes $45,000 for
hardware (computers, printers, etc.); $25,000 for software for operating system programs and for applications for
payroll, tax-billing, and budgetary accounting systems; $15,000 for rewiring; and $10,000 for consulting and maintenance
services for 18 months after purchase. The Burger sales person says she can have the computer installed and operating
within 60 days of order. The new computer system will enable the city's finance department to perform basic tasks (e.g.,
payroll) faster and more accurately and to take advantage of the new software for financial forecasting and debt planning
and management.
New Fire Station: Estimated Cost $746,000
Architectural and engineering work and construction on all requests is contracted unless otherwise stated. The
community has one central fire station that is housed in a 60-year-old structure located on land that the city council
wants to use for a new law enforcement complex. The station is also not large enough to house the elevated-platform
truck that the Fire Rating Bureau recommends that municipality buy. Preparing the architectural design and blueprints
will take two months, and construction will take 18 months.
New 85-Foot Elevated Platform Truck: Estimated Cost $350,000
7. The fire department now has one 2,000-gallon tanker truck, a 1,000-gallon per minute (gpm) pumper, and a 1,250-gpm
pumper. It does not have a ladder or elevated-platform truck. The State Fire Rating Bureau has recommended that the
municipality acquire an elevated-platform truck before the new electric components plant starts operating 18 months
hence and before the new six-story apartment building to be built downtown opens two years from now. If the
municipality does not get the platform truck before the electronics plant starts operating, its fire rating will drop, costing
property owners 10% more in fire insurance premiums. If the truck is still not available when the new apartment
building opens, the city's fire rating will drop another notch, costing property owners another 10% in fire insurance
premiums. One- fourth of the fire truck's cost will have to be paid on order and the balance on delivery. Delivery will
take one year from order.
New Maintenance Garage (Municipality Owned): Estimated Cost $650,000
The municipality now contracts all maintenance and repair work on its vehicles and equipment to private garages. The
maintenance contracts amount to $155,000 a year plus parts and supplies. The public works director says that the
municipality will save money by building and staffing its own repair and maintenance garage. The garage would be
staffed by two mechanics and a mechanic's helper. Personnel, fringe benefits, and other operating costs would be
$100,000 a year. The garage would do all repair and maintenance on city equipment and vehicles except major overhauls
and body work. Such work would be contracted at an estimated annual cost of $35,000. The public works director says
that the city will save at least $25,000 a year by purchasing automotive parts and supplies itself and the city will get better
service and have greater control over maintenance and repair work.
Municipal Building Remodeling: Estimated Cost $960,000
The municipal building was built in 1925. It is well-constructed and has recognized historic value, but it does not meet
the needs of the city's administrative staff today. The building houses the council chamber, the mayor's office, the
municipal manager and her staff, the finance department, and the police department and jail. The city hall is not air
conditioned, although many offices have window units. Administrative offices for the sanitation director, public works
director, the planning and inspection department, the water-sewer director, and the recreation director and their office
staffs are located in rented space in a building five blocks from city hall at an annual rent of $50,000. The manager is
8. recommending that the city hall be remodeled and that central air conditioning be installed. It will then house the
administrative staffs of all city departments except police and fire.
New Law Enforcement Complex: Estimated cost $979,900
The manager's plan also includes the construction of a new law enforcement complex on land immediately adjacent to
the city hall now occupied by the fire station. The space in the municipal building used by the Police Department has
become too small given all of the increases in equipment and the need for a holding cell. Also, the municipal building
presents significant security and structural problems.
New Public Library: Estimated Cost $690,000
The municipality has no public library. A local library foundation has been formed composed of several of the town's
leading citizens. It will donate the land for the library, valued at $100,000, and will give $60,000 toward the initial
collection of books and materials if the city spends $30,000 a year for books over the first three years of the library's
existence. The proposed location for the library is in downtown Parkrose, which is of concern to the city’s planning
staff. This staff has been at the forefront of the municipality’s effort to attract more business to the downtown area,
which has suffered some decline in recent years. The proposed library location has been identified by the planning staff
as one of the city's prime development sites.
9. New Park and Athletic Field: Estimate Cost $846,200
The Northside of town has no park, playing field, or athletic facilities. The school on that side of town also lacks
adequate playing areas and facilities, and parents and students have formally petitioned the city council to build a new
park on that site.
New Compacting Trucks for Sanitation: Estimated Cost: $240,000
The sanitation division has six compacting trucks: two front-end loaders, two rear-end loaders, and two automated side-
loading trucks. The front-end loaders are used for commercial, industrial, and apartment pick-up. The rear- end loaders
and side-loading trucks are for residential curbside pick-up. The rear-end loaders are each five years old and have three-
worker crews--a driver and two loaders. Maintenance on them will total $12,000 this year. The sanitation director wants
to replace them with two more automated side loaders ($150,000). The side loaders can be operated by one equipment
operator. The city will have to purchase new roll-out solid waste containers for the city neighborhoods to be served by
the side loaders ($20,000). The sanitation director is also requesting a new front-end loader ($70,000) to replace one of
the front-end loaders, which is four years old. The normal useful life of a front-end loader is five to seven years. The
sanitation director says that if the truck is not replaced, its engine will have to be rebuilt and other repair work done next
year for a total of $20,000. With these repairs the truck probably would last for another three years. The new packers can
be expected to be delivered within six months. Payment will be required within ten days after delivery.
10. Development of New Shell Building (will be leased to a manufacturing firm): Estimated Cost
$825,000
New state statutes authorize municipalities to acquire and develop land for industrial parks, to acquire and hold for
resale property that is suitable for industrial or commercial use, to extend water-sewer or other utility services to an
industrial facility, and to acquire or construct one or more shell buildings (buildings of flexible design adaptable for a
variety of industrial or commercial business uses) to convey or lease for consideration to a business for industrial or
commercial use. The authorizing statutes limit the city's investments in such industrial or commercial property to one-
half of one percent of the city's tax valuation. Two major manufacturing firms have expressed interest in locating plants
in the municipality. One would employ 55 persons and add $3 million to the city's tax base. The second would employ
40 people and add $2 million to the tax base. The planning director and the executive director of the Chamber of
Commerce are recommending that the city construct a shell building to accommodate either of these plants (or another
similar manufacturing plant) on a large industrially zoned site on the west end of town. The municipality would then sell
or lease the shell building to one of these manufacturing firms. The construction of the shell building on the west side
site is viewed as the first step in the development of Parkrose’s first industrial park, which would eventually contain
several large manufacturing enterprises.
Implementation Strategy
While assessing the needs of the community the projects were ranked on whether or not they:
1. Eliminate Hazards
2. Promote Economic Development
3. Improve Efficiency
4. Maintain Service Standards
5. Improve Service Standards
6. Add Convenience
11. These factors were considered along with financial savings opportunities, revenue generating opportunities, and
community beautification. The following matrix represents the results:
P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11
Eliminates Hazard
(x6)
6 0 0 6 0 0 6 0 0 6 0
Promote Economic Development
(x5)
0 0 0 5 5 0 0 5 5 5 5
Improve Efficiency
(x4)
4 4 4 4 4 4 4 0 0 4 0
Maintain Service Standards
(x3
3 3 3 3 3 3 3 3 3 3 0
Improve Service Standards
(x3)
3 3 3 3 3 3 3 3 3 3 0
Financial Savings
(x2)
0 0 0 2 2 2 0 0 0 2 0
Revenue Opportunity
(x2)
0 0 0 0 0 0 0 0 0 0 2
Community Beautification
(x1)
0 0 0 0 0 0 0 1 1 0 1
Add Convenience
(x1)
1 1 1 0 1 1 0 1 1 1 0
Total 17 11 11 23 18 13 16 13 13 24 8
In addition to the needs valuation of the improvements the projects would bring a second evaluation was done
determining urgency of need:
P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11
Urgent X X
Necessary X X X X
Desired X X
Ongoing
Deferrable X X X
12. The following is a compilation of each valuation measure and the resulting year of implementation:
Capital Improvement Plan Description:
The following plan is designed to highlight areas of emergency concern and community improvement. The
implementation of the plan will require tax increases in the first few years which will allow for major projects to begin in
2015. By the end of the 5 year plan taxes will begin to lower to more typical rates and property values in the township
will rise due to community developments. Short term Increases in tax expenses will lead to township funded projects as
opposed to taking on debt.
In 2013 the establishment of a shell building was moved to urgent to allow for an increase of tax base that will ease tax
burden for the plan. Contract will be negotiated to bring in a manufacturer that will add 55 new jobs and increase the tax
base by $3 million. Sanitation improvements will also allow for savings of wage expense from reduction of the work
force. Only 3 employees will be laid off due to the changes instead of 4 to allow for a fill in employee for the schedule.
These savings will equal $120000 a year going forward, which will provide savings in the future. The development of the
maintenance facility will save net cost of $45000 a year after the building is complete in year one. These savings will
allow the building to pay for itself in just over 10 years.
In 2014 the purchase of the new fire truck and the building of the new fire department will take place. The fire truck will
provide immediate relief and prevent future increased insurance costs that would begin by the end of the year. The
building will take some time to build, but it will be necessary to house the new fire truck. The fire truck will remain
outside the current fire department until construction of the bay is complete after year one.
Project Importance Urgency Implementation Year
P10 24 N Year 1
P4 23 U Year 2
P5 18 N Year 1
P1 17 Def Year 4
P7 16 N Year 3
P6 13 Def Year 4
P8 13 Des Year 3
P9 13 Des Year 3
P2 11 Def Year 5
P3 11 N Year 2
P11 8 U Year 1
13. In 2015 tax payer dollars will be spent heavily on community developments. The new Library will begin to be
constructed with a donation of property. Additionally, the township will begin collecting books and materials to be
matched in 3 years by the community with $60000 in donations. The Northside Park will also begin to be built. To
improve safety and bring the police station up to date, the new complex will also begin being built. This year will be
heavily supported by tax increase, however the target for the increased dollars is heavily toward community
improvement.
In 2016 the remodeling of the municipal building will begin. The building is out of date and costing the township funds
by being inefficient. In 2017, and every year after, a $50000 savings from rent will be achieved due to consolidating the
departments. This will allow for half the building to be paid for just by savings over the course of 10 years. There will
also be funds allocated to the police communication system that is out of date and an emergency concern. A federal
grant will save 20% of the cost if we implement it which will lower the cost to taxpayers.
In 2017 taxes will be nearing close to normal. The only implementation will be the new computer system for the new
municipal building. The system will allow for better planning going forward and improved financial documentation.
Breakdown of CIP plan with costs or savings per year. Displayed in increase or decrease to expenditures.
Year of Capital Improvement Plan
Description of Budget Change 2013 2014 2015 2016 2017
YEAR 1
CHANGES
Shell Building Purchase and Development 825000 0 0 0 0
Maintenance Facility Construction 650000 0 0 0 0
Sanitation Department Compactor Upgrades 240000 0 0 0 0
Salary Expense Reduction from Sanitation -120000 -120000 -120000 -120000 -120000
YEAR 2
CHANGES
Maintenance Facility Savings 0 -45000 -45000 -45000 -45000
New Fire Truck 0 350000 0 0 0
New Fire Building 0 746000 0 0 0
YEAR 3
CHANGES
Law Enforcement Complex 0 0 979900 0 0
Book Collection 0 0 30000 30000 30000
Library 0 0 690000 0
New Park Development 0 0 846200 0 0
YEAR 4
CHANGES
Municipal Building Renovations 0 0 0 960000 0
Police Communication Systems 0 0 0 220000 0
YEAR 5
CHANGES
Computer System 0 0 0 0 95000
Book Collection Donation Refund 0 0 0 0 -60000
Rent Savings From New Municipal Building 0 0 0 0 -50000
TOTAL CHANGES 1595000 931000 2381100 1045000 -150000
14. The following chart outlines the real tax dollar increase per person for the CIP plan:
Real Dollar Increase Per Tax Payer
3% Tax Plan 5% Tax Plan 7% Tax Plan
47 70 86
115 132 183
164 198 213
79 139 198
-43 18 91
*Calculated by taking total tax revenue increase from
CIP plan and subtracting the projected tax revenue
without the plan. Based on no increase to population.
Taxation schedule for 5 years:
Year Tax Increase
to Projection
Mil Rate Tax Increase
to Projection
Mil Rate Tax Increase
to Projection
Mil Rate
2013 426396 13.5 639593 15 781725 16
2014 1044039 17.2 1202523 18.25 1662881 21.3
2015 1493934 19.8 1800035 21.75 1933463 22.6
2016 721098 14.7 1259835 18 1798572 21.3
2017 -387609 8 164188 11.25 826345 15.15
*Tax increase to projection is based on calculation of projected increase to assessed value
multiplied by proposed mill rate divided by 1000. The total is then subtracted by the projected
increase in property tax revenue without improvement plan. Additionally, $3 Million is added to
assess value of 2014 and calculations reflect this increase.
Breakdown of expenditures, revenues, and fund balance with CIP implementation:
Projections 3% 5% 7% Increased
Rev 3%
Increased
Rev 5%
Increased
Rev 7%
PFB 3% PFB 5% PFB 7%
2013 7618585 7730693 7842802 6516034 6729232 6871364 459664 560753 590776
2014 7127792 7360978 7598648 7377263 7535747 7996105 709135 735522 988234
2015 8756296 9120077 9497983 8080488 8386588 8520016 33326 2034 10268
2016 7603952 8108425 8642565 7571114 8109851 8648587 488 3459 16290
2017 6598220 7254097 7961894 6736407 7288205 7950361 138675 37567 4757
* Increased revenues are calculated by adding increased revenue from CIP plan and tax increases. Increased
revenue reflects projected increase, CIP costs for the year, and CIP reduction in expenses for each year.
15. The following is a comparison of the expected expenditures and revenues for each year and projected increase if the CIP
is implemented:
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
8000000
9000000
10000000
2013 2014 2015 2016 2017
Projected Expenditures for CIP
3%
5%
7%
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
8000000
9000000
10000000
2013 2014 2015 2016 2017
Projected Revenue for CIP
Increased Rev 3%
Increased Rev 5%
Increased Rev 7%
16. The following charts compare the projected fund balance with the expected fund balance with the CIP implemented:
0
500000
1000000
1500000
2000000
2500000
3000000
2013 2014 2015 2016 2017
U.S.Dollars
3% Projected Fund Balance vs CIP Plan
CIP PFB 3%
PFB 3%
0
500000
1000000
1500000
2000000
2500000
2013 2014 2015 2016 2017
U.S.Dollars
5% Projected Fund Balance vs CIP Plan
CIP PFB 5%
PFB 5%
17. Conclusion
The projects will greatly increase the value of the community and township. Parkrose will see a brief increase in taxation,
but the results will allow for the generation of projects that will pay for themselves and develop the community. After
the 5 years taxes will begin to recess back to normal and there will be a new fire department, library, park, police
complex, and municipal building. All tax payer funded with no debt.
-1500000
-1000000
-500000
0
500000
1000000
1500000
2000000
2500000
2013 2014 2015 2016 2017
U.S.Dollars
7% Projected Fund Balance vs CIP Plan
PFB7%
CIP PFB7%
