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City of Lincoln Parks & Recreation Department Infrastructure Committee

In September 2005, a fourteen-member committee was appointed by Mayor Coleen Seng to develop a strategy for funding Lincoln’s parks and recreation infrastructure. The committee met seven times during the following three months. Initially, the committee discussed the growing backlog of costs resulting from budget shortfalls over the past decade associated with caring for existing facilities and projects associated with growth of population in the community. The committee then developed a strategy for funding $114 million of identified projects over the next twenty years.

The committee recommended the following:

• Provide adequate funding to repair and replace existing infrastructure. It is estimated that this cost is annually about $1.3 million in 2005 dollars. This funding should be derived from general revenue (property tax and sales tax sources). Funding will need to increase concurrent with inflation.

The Lincoln-Lancaster County Comprehensive Plan states that the community has "been favored with a long and distinguished legacy of parks, recreational facilities and open space. The earliest planners and policy makers recognized the strength conferred upon a community possessing an abundant, quality system of parks and open spaces, along with the support facilities to enjoy them." The Comprehensive Plan also guides expansion of parks and recreation infrastructure as the population of the community grows by establishing policy direction and level of service standards.

Adequate funding must be provided to repair and replace existing parks and recreation infrastructure, and to expand the system as the community grows. The purpose of this report is to provide a proposed finance plan for the capital improvement program of the Parks and Recreation Department.

A fourteen-member committee was appointed by Mayor Coleen Seng in September 2005 to discuss and evaluate funding needs associated with the Parks and Recreation Department capital improvement program (CIP) in response to a serious and growing backlog of funding needs resulting from budget shortfalls over the past decade. The committee was appointed in response to Resolution No. 83516 passed by the City Council on August 29, 2005. The resolution supported appointment of "a citizen task force involving broad representation of the community to determine: a) what level of investment is required to maintain the quality of Lincoln’s system of parks and trails, b) what level of capital funding should be provided in FY 2006-07 and subsequent years, and c) the proper role and capacity of private support for maintaining public assets." This resulting report is to be available for consideration by the City Council during the budget forecast retreat in December 2005.

The need for funding of the Parks and Recreation Department CIP can be divided into three broad categories: a) repairing and replacing existing parks and recreation infrastructure, b) addressing projects deferred due to funding restrictions, and c) building new facilities as the population of the community increases to maintain the adopted level of service standards. The initial estimate of funding needs over the 20-year planning period discussed by the committee was about $141.6 million in 2005 dollars.

Initially, the committee reviewed annual costs associated with repair and replacement of existing parks and recreation facilities.

The committee then reviewed the following listing of current and growth related projects and associated costs:

The committee reviewed potential revenue sources to fund the identified projects, including keno funds, general revenue (tax) funds, user fees, grants and donations in order to match funding sources with project categories. The committee also looked at other ways to close the gap between revenues and expenditures. These methods were: 1) to cut, defer or modify projects 2) additional alternative financing methods, and 3) general obligation bonding possibilities.

The committee reviewed and prioritized the list of current and deferred projects and projects associated with growth of the community. The committee then identified opportunities to reduce, defer or modify some projects resulting in an estimated savings of $27.7 million. The following is a discussion of these projects including the savings identified.

The committee suggested that if the annual budget for repairing and replacing trails is adequately funded (based upon a 50-year replacement cycle), about $2.1 million of trail upgrade and renovation projects currently identified as being deferred could be funded over time. Examples of these trail projects include replacement of the asphalt section of the Helen Boosalis Trail along Highway 2 between 27^th and 17^th Streets, replacement of the trail on the south side of Superior Street between I-180 and 27^th Street, and upgrade of the Murdock Trail from rock surface to concrete. Renovation and upgrade of a section of the Billy Wolff Trail is proposed to be funded through a GO bond issue as discussed below.

The committee looked at the potential revenue streams to pay for $7.7 million of trail connections within the existing city limits. Previously $100,000 was budgeted annually for trail projects - $90,000 for new trail construction and $10,000 for trail repair and replacement. As the trail system has been expanded, there is a need to significantly increase the amount of funding available to repair and replace trail infrastructure. The committee recommended that construction of trail connections within the existing city limits be funded with through ongoing fundraising efforts matched with transportation grants. Trail projects will alternate annually between projects in growth areas of the communities (funded with impact fees and matching grants) and trail connections (funded with donations and matching grants) to maximize opportunities for transportation grant funding. General revenue funding support of trails will be directed to trail repair and replacement.

The committee reviewed the locations and service areas of the existing 11 outdoor public pools in Lincoln. Kuklin Pool is planned to be replaced due to failure of the concrete pool basin. The committee considered the overlap of the service area of Kuklin Pool with Woods pool, and also looked at the success of the recently constructed sprayground at Woods Pool. The committee recommended that a new sprayground be constructed at a location north of ‘O’ Street, and that the existing failing Kuklin Pool facility be demolished.

The committee proposed construction of a new sprayground for the following reasons:

• Woods Pool adequately serves adults and teens within its service area.
• The predominant use of the existing Kuklin Pool facility is for shallow water activities.
• A sprayground is an innovative water recreation facility attractive to children and families.
• The sprayground would cost less to build and operate while providing recreational opportunities for children and families.
• Placement of a sprayground north of ‘O’ Street makes it more readily accessible to the neighborhoods the facility is intended to serve.

The committee reviewed a concept for construction of a new community center in central Lincoln intended to provide opportunities for shared facilities and coordinated programming with the Clyde Malone Community Center, the Asian Center, the Hispanic Center and the Indian Center. A master plan was developed in 2004 that considered co-location of a new public community center with a new Malone Community Center in Trago Park. The committee expressed concern about the cost of the project and suggested that options be considered including a new facility co-developed with the YMCA at Elliott Elementary School, renovation of space within the former Whittier Junior High School building as part of an overall adaptive reuse and renovation project, or a scaled-down version of a free-standing recreation center in Trago Park. The committee suggested that a bond issue might be an option for funding one of the alternatives above, but did not make a recommendation regarding direction for the project.

The committee believed that construction of an indoor ice arena should be deferred beyond the time horizon outlined in this report, unless private funding is secured.

Estimated Savings: $3,500,000

The Comprehensive Plan establishes a level of service standard of 1.5 acres of community parkland per 1,000 residents. This standard is less than the current ratio of 4.4 acres of community parkland per 1,000 residents. (National Recreation and Park Association recommended guideline for community parks is 5 to 8 acres per 1,000 population - Recreation, Park and Open Space Standards and Guidelines, Roger A. Lancaster, 1983.) The committee initially suggested that the local standard for community parks be revised to 3.0 acres per 1,000 residents, but subsequently determined that the standard of 1.5 acres per 1,000 residents is reasonable given funding constraints.

Initially the projected cost estimate included acquisition and construction of two new community parks, and development of the new park facilities associated with the Antelope Valley project. The committee recommended the following during the next 20-year period:

• acquisition of two areas for future community parks;
• development of one of these new community park areas, most likely in northwest Lincoln; and
• consider the $5.9 million dollar anticipated expenditure for park improvements associated with the Antelope Valley project to be a new community park serving the central portion of the community.

The committee looked at the need to build new recreation centers co-located with schools in northeast, southeast and southwest Lincoln. The committee noted that the YMCA has expressed interest in constructing recreation centers in northwest and southeast Lincoln, and recommended cooperative planning to avoid duplication of facilities. Thus, the finance plan includes construction of one new recreation center by the City, most likely in southwest Lincoln. The committee is recommending that funding for this new recreation center be through a general obligation bond issue.

The committee recommends implementation of three new alternative funding methods:

1) inter-fund loan accounting, 2) establishment of a community-wide assessment for planting of street trees, and 3) and formalize a continuing inter-governmental cooperation agreement for acquisition and management of parkland and open space.

The Lincoln/Lancaster County Comprehensive Plan identifies park and open space areas to be acquired and conserved. In many instances future trail corridors correspond with these future park and open space areas. A trail corridor and greenway is identified along the South Beltway linking primary commuter/recreation trails. Parks and Recreation staff have worked closely with Nebraska Department of Roads (NDOR) in identifying 131 acres along the corridor needed to accommodate a trail along the north side of the beltway, similar to the Helen Boosalis Trail along Highway 2, and Roper Park (formerly "Interstate Park) along I-180. The estimated cost for acquiring the 131 acres is $2.6 million. The NDOR is currently identifying land along the South Beltway for acquisition for construction of the roadway and is willing to acquire and be reimbursed for additional land to secure parks and trails possibilities along that corridor. The committee felt that this was an urgent need and asked that the City Council make identification of funding for this project a priority. The committee suggested that the following options be explored:

• an inter-local agreement with Lancaster County and the Lower Platte South NRD to jointly fund acquisition of the greenway - initial discussions suggest that perhaps $400,000 may come from these partners;
• pursue options to sell publicly owned land determined to be surplus for community park and open space needs – perhaps $600,000 could be generated from sale(s) of land; and
• request funds through voter-approved GO bond funding .

The committee discussed two options for formalizing intergovernmental cooperation for the purposes of acquiring and managing parkland and open space within Lincoln’s future urban service limits. The following is a brief description of the two options:

Nebraska State Statute Section 13-304 allows the establishment of a "parks and recreation tax" through an inter-governmental agreement for the purpose of acquiring, improving or operating parks and recreation facilities. Tax receipts may be accumulated from multiple fiscal years.

Nebraska State Statute Section 13-805 allows the establishment of cooperative agreements between two or more public agencies. Related Section 13-808 allows a joint entity created through a cooperative agreement to issue bonds to finance projects within the purpose of the agreement.

The committee recommended that an inter-local cooperative agreement be established between Lancaster County, the Lower Platte South Natural Resources District and the City of Lincoln for the purpose of acquiring and maintaining park and open space areas in Lincoln’s future service limits area. This agreement would allow the cooperating agencies to develop and fund projects, including the possible issuance of bonds. This agreement should include acquisition and management of the following categories of parkland and open space:

• environmental resource lands identified within the Comprehensive Plan for conservation (e.g., floodplain areas, wetlands, saline wetlands, native prairie);
• two future community park sites co-located with environmental resource lands as directed by the Comprehensive Plan;
• a future regional park site co-located with environmental resource lands in the Stevens Creek basin as directed by the Comprehensive Plan; and possibly
• the greenway area for parks and trails along the South Beltway;

Nebraska State Statute Section 15-201 allows for a special assessment to plant and maintain street trees. The committee recommended that a community-wide street tree assessment be established to fund the cost of replacing street trees as they are removed due to damage, structural deficiency or disease, and to plant street trees in the estimated 12,000 "gaps" along public streets. This would transfer tree planting from an obligation of the general fund freeing up $75,000 dollars of general fund tax dollars. The annual cost on a $100,000 of assessed valuation would be about $1.40.

The committee recommended exploring options for establishment of loans between city funds for specific projects.

Traditionally, potable water has been used to irrigate athletic fields, golf courses, and some park areas. More recently, wells have been established to irrigate these types of areas. The Parks and Recreation Department would like to continue converting existing irrigation systems from potable water to groundwater well sources. Conversion of irrigation systems to groundwater allows potable water to be directed other uses in the community. Also, the cost of operating wells is less than the cost of purchasing potable water. The committee recommended that the Parks and Recreation Department enter into an inter-fund loan agreement to be repaid with through annual savings in water payments to continue conversion of irrigation systems from potable water to groundwater sources.

The committee also looked at the revenue stream that current park shelters generate and recommended that these revenues be placed in a sinking fund to be used to build new park shelters. The estimated payback period was eight to ten years for a typical shelter (based on the current fees) based on figures provided by the Parks and Recreation Department.

The committee discussed a number of projects and suggested that going to a vote of the people for general obligation (GO) bond funding for several projects is a reasonable funding opportunity. The criteria for GO bonding were two fold: 1) that funding for the project is necessary and could not be funded through general fund or keno sources and 2) the community had previously been asked to fund similar previous projects through voter approved GO bonds. About $31.3 million of projects were identified to be funded through a regular series of voter-approved GO bonds over the next 20-year period. The following is a discussion of projects identified as the highest priority projects at this time.

For many years the City has operated the former air force base recreation center in the Air Park area as a public recreation center through a lease agreement with the Airport Authority. Attendance at the facility has been challenged by separation of the facility from residential areas. The City has expressed a desire to co-locate community facilities, including a recreation center, with a new elementary school replacing Arnold Heights Elementary School. It appears that Lincoln Public Schools will be asking voter approval of a GO bond issue in early 2006 for renovation and construction of schools, including the replacement school for Arnold Heights Elementary School. The committee recommended continuing discussions with the School District to allow coordinated funding and construction the new school/community center. Options discussed include parallel or sequential GO bond issues, or integration of funding for community facilities within the school GO bond issue.

The committee recommended packaging Lincoln’s pool related projects for a GO bond issue at some future date. The committee identified the following projects:

The total estimated future cost for these pools and water facilities would be $6.2 million dollars. These dollars would rehabilitate or expand existing pools, and would provide additional pools in new areas of the community – likely in southeast and southwest Lincoln. The estimated annual cost to issue bonds to build these projects at current interest rates would be about $2.80 per $100,000 of assessed valuation.

The committee recommended that a GO bond issue be considered for the estimated $1.4 million of improvements and upgrades associated with the section of the Billy Wolff from South 72th Street through ‘A’ Street. The committee felt that there could be broad community support for upgrading Lincoln’s first commuter/recreation trail, and that the assessment would be less than one dollar per $100,000 of assessed value.

Within the past five years, the City has hired two people to assist in securing grants and donations to augment local tax and keno funds. The proposed funding plan includes more than $21 million of grants and donations, or more than $1 million annually. The committee noted that grant and donations are typically project specific. The committee also stated the importance of grants and donations as supplemental funding sources to basic governmental financial support.

Over the past ten years various alternatives for renovation of Centennial Mall have been considered. A grand vision for redevelopment of the entire seven blocks was developed in the late 1990’s. The estimated cost associated with this plan was about $20 million. Recently a more modest plan has been developed that retains the identity and character of the original design of the Mall, but also:

• increases the amount of lawn and landscape areas,
• recreates four of the six original fountains, and
• eliminates stairs within the primary north/south pedestrian walkways.

The estimated cost of this plan is about $5.5 million.

The committee suggested that the funding strategy for renovation of Centennial Mall could essentially divide the cost into thirds: $2 million coming from the City, $2 million coming the State, and $1.5 million coming from a private fundraising effort. It was also suggested that the project could be phased by reconstructing one or two blocks each year eliminating the need to generate all of the funding in a single year.

Governmental proceeds from private operation of Keno games in the community are utilized to support human/social services, libraries, and parks and recreation facilities. By joint resolution of the City Council and the Lancaster County Board of Commissioners, 65-percent of Keno revenue is directed to the Parks and Recreation Department CIP. Initially these funds were primarily directed to construction of new facilities in the community including Star City Shores, Highlands Pool and University Place Pool. Recently, Keno funds have been utilized for basic repair and replacement projects as general revenue funding has declined. The committee recommended that Keno funds again be directed to construction of new facilities. The committee noted that Keno revenue gradually and steadily increased over much of the past decade. In the past year, Keno revenue has declined due to various market factors. The committee recommends that Keno revenue be monitored and that actions be taken be make up any shortfall in revenue from other sources, including general revenue.

The committee reviewed information regarding allocation of city funds to the Parks and Recreation Department CIP. Two trends were noted. General revenue funding of the Parks and Recreation Department CIP has declined from $1,170,000 in fiscal year 1995-96 to $275,000 in fiscal year 2005-06. The general revenue contribution to the Parks and Recreation Department CIP was 1.45% of the City budget in fiscal year 1995-96 and declined to 0.21% of the City budget in fiscal year 2005-06. This decline in funding has resulted in a backlog of repair/replacement projects that need to be addressed, and hampers the ability to expand park and recreation facilities consistent with community standards as Lincoln grows.

The committee noted that the community has demonstrated the ability to direct about 1.4% of the overall budget to repair, replacement and expansion of parks and recreation infrastructure. (1.4% of the City budget for fiscal year 2005-06 is about $1.84 million.)

Approximately $1.3 million per year is required to "close the gap" between estimated costs and funding sources after evaluating opportunities to cut or modify projects, to secure GO bond funding for identified projects, and to utilize alternative funding sources. The committee determined that approximately $1.8 million of general revenue funding should be directed to the Parks and Recreation Department CIP over the next five years to address existing facility needs, and to address funding initial park improvements associated with the Antelope Valley project.

At the outset the committee saw a funding gap of over $80 million. The committee believes that the proposed funding plan will put the city on a long-term solid financial position that will preserve the park system that citizens enjoy and support; and contributes to the quality of life that attracts people to want to live in Lincoln.

The committee recommended that the following list of projects be addressed in the immediate future:

1. Fund the $1.3 annualized cost to repair and replace existing facilities. (refer to Table 2.)
2. Identify and implement a funding strategy for acquisition of the greenway along the South Beltway. Begin by discussing possibilities for financial participation by Lancaster County and the Lower Platte South Natural Resources District.
3. Authorize a GO bond issue for a first tier of projects to:

• renovated existing pools and construct two new pools,
• upgrade and replace the central section of the Billy Wolff Trail (approximately Capital Parkway to ‘A’ Street), and
• construct a new recreation center with a new elementary school in the Air Park area.

1. Establish a funding strategy for development of the initial park improvements associated with the Antelope Valley Project. It should be noted about $6.55 million is needed over the next five-year period in order to keep pace with the anticipated schedule for construction for the new Antelope Creek channel and associated improvements. It is estimated that $4 million of Keno funds can be directed to this effort. The remaining $2.5 million should be derived from general revenue funds over the next five-year period.

Administration Division