Spokane Valleys considers funding options for streets

The Spokane Valley City Council took a small step forward Tuesday in determining how to pay for an estimated $11 million annual shortfall in street preservation and reconstruction costs over the next six years.

The options presented this week include either continuing the current policy of setting aside 40 percent of the city’s year-end general fund balance greater than $26 million for street preservation or taking 100 percent of the balance greater than $26 million. The ending fund balance was $28,050,000 in 2011, said Finance Director Mark Calhoun, making those options worth $820,000 or $2.05 million. That money would be combined with the $750,000 the city has in its street capital improvements budget and about $611,000 the city has already committed to fund improvements to Evergreen Road this summer.

Calhoun acknowledged that neither option would provide a complete solution to the shortfall problem. “Staff believes it’s not possible to meet the needs of the plan without an added sustainable revenue source,” he said.

Calhoun recommended taking 40 percent of the surplus, in light of several upcoming projects the city has identified. Those include the need to replace the Sullivan Bridge, the possible acquisition of land at Sprague Avenue and Herald Road, a future city hall and the possibility of helping Spokane County fund a new regional animal shelter. The city may also lose some shared revenue currently distributed to cities by the state, he said. “It preserves the general fund balance,” he said.

Councilman Arne Woodard suggested using the first option and then allocating the other 60 percent of the surplus to the Sullivan Bridge replacement. “That is the top priority in my book, even above the roads,” he said.

“I don’t care about a city hall if our roads are bad,” said Councilman Chuck Hafner. He said he preferred the second option and believed the $26 million reserve would be enough to address the city’s needs. “I look at the $26 million as substantial,” he said.

The city’s policy calls for at least 15 percent of the annual general fund budget to be held in reserve. The city’s year-end balance of $26 million is about 72 percent of the city’s annual general fund budget, Calhoun said.

Mayor Tom Towey said he favored the first option and didn’t think it was wise to use the second option “with Sullivan Bridge staring us in the face.”

“I disagree,” said councilman Dean Grafos. “Time is money. The $26 million isn’t a magic number.” Construction costs are low now and the city should take advantage of that by setting aside all the money it can. “We probably won’t be able to spend all that money.”

“I betcha we could get the money spent,” Woodard said.

Councilwoman Brenda Grassel said the city’s Finance Committee was asked to bring forward street preservation funding options. “I would go with option two because that is their recommendation,” she said. “We’re so far behind the eight ball.”

But Grassel said she was also concerned that several council members said the city needs to create a new revenue source to pay for additional street preservation. The city should only use general fund dollars to pay for street projects, she said.

“We need to be looking at every single dime we spend in the general fund,” she said. “I’m not willing to even consider another revenue source until every stone has been turned.”

The city can easily afford to use the entire surplus above $26 million, Grafos said. “This is the time to spend those dollars,” he said. “I don’t think the sky will fall if we take another $700,000.”

Grafos, Woodard, Grassel and Hafner voted to bring forward a resolution to use the entire surplus.

In other business, the council discussed the sign code changes recommended by the city’s planning commission. The changes include allowing wall signs on multifamily buildings, allowing more free-standing signs for businesses, allowing off-premise directional signs and allowing A-frame signs. The city currently bans directional signs and A-frame signs.

The proposed new rules would also change the limits on temporary signs, allowing one temporary sign to be displayed at all times without a permit or a fee provided the sign is in good condition.

There was some discussion on the new rule regarding free standing signs. Currently businesses are allowed one sign per arterial street frontage. The proposal is to allow one sign for every 500 feet, or fraction thereof, of arterial frontage and every 300 feet of street frontage. This would allow a 500-foot lot to have two signs and a 700-foot lot would be allowed three.

Grafos suggested allowing businesses to have a sign for every 150 feet of frontage. Sign industry representatives who testified in a public hearing recommended at least 200 to 250 feet between signs, said senior planner Lori Barlow. “You really need to think about the additional amount of clutter along the arterials,” said Community Development Director John Hohman.

If the city wants to allow signs for every 200 feet of frontage it should create rules setting minimum spacing requirements between signs, Barlow said. Councilman Ben Wick said he was opposed to allowing an even more generous amount of signs. “I don’t want to see our city cluttered up with signs,” he said. “There was a method to the madness back then.”