Subject:
Title
Capital Improvement Program (CIP) 2028-2042 Update and Planning Review
Body
EXPLANATION AND SUMMARY:
The Town Council adopted the current Capital Improvement Program (CIP) in Fall 2025 and approved borrowing authorization for FY 2026 capital projects. Fiscal Year 2026-27 is designated as a planning and review year for the CIP and provides an opportunity for Council to review and update capital priorities, revise project schedules, evaluate funding assumptions, and consider modifications to planned projects and future borrowing needs.
The Town currently funds its Capital Improvement Program through a combination of General Obligation (GO) Bonds, Water and Sewer User Fees, and available grant funding. GO Bond debt service is primarily supported through Meals Tax revenues, which are currently generated from the Town’s 4% Meals Tax rate.
Based on prior Council guidance, staff has prepared and is presenting two CIP funding scenarios for Council review and discussion:
• A CIP scenario maintaining the current 4% Meals Tax rate; and
• A CIP scenario reflecting a reduced 3% Meals Tax rate.
The scenarios illustrate the impacts on project affordability, debt capacity, project timing, and long-term financial sustainability under each funding structure.
Purpose of Work Session:
The purpose of this work session is to receive Council feedback and direction regarding:
• Council capital project priorities;
• Proposed revisions or additions to the CIP;
• Funding assumptions and debt affordability;
• Potential impacts associated with a reduced Meals Tax rate; and
• Long-term capital planning considerations for the FY 2028-2042 CIP.
Staff will utilize Council feedback to prepare the proposed CIP for future formal presentation and adoption consideration.