EDITORIAL: If You Build It, They Will Pay… Part Three
I spent about 18 months living in Salida, Colorado, a few years back — thinking I might escape from my challenging career as a news reporter, and establish a simpler existence in a new community with a walkable downtown district and a vibrant artist community.
Things didn’t work out quite the way I’d imagined… but while I lived there, I wrote a few articles — maybe more than a few — for a little news website I created with writer Cynda Green: the Salida Daily Post. One of our articles concerned questionable City Council decisions related to the City of Salida’s decision to get into the real estate business — something that, I later learned, was apparently against Colorado law.
The City had invented a municipally-controlled “non-profit organization” called the Natural Resource Center Development Corporation to construct and lease out a $3.4 million office building to the U.S. Forest Service. When it became apparent that the NRCDC had never calculated the cost of building maintenance, we finally saw a budget presented to the City Council that included building repairs and maintenance.
Here’s a section of the budget.
The City was going to be providing “building management” at a rate of $12,034 per year… plus we see a line item amount of $1,605 for “Building Maintenance and Reserves.” Additionally, the NRCDC committed to set aside $4,974 per year as a “Capital Maintenance Reserve.” Supposedly, these expenses would be funded out of the monthly rent coming from the federal government.
It thus appeared that the NRCDC was budgeting $18,613 per year for building management and maintenance — for a new office building projected to cost about $3.4 million. That may have seemed reasonable, if you didn’t look too closely.
But I was curious. What does it really cost to maintain a $3.4 million building? And make needed repairs?
According to a recent article in Tradeline, a leading resource for facilities planning and management, companies like IBM and DuPont typically budget, annually, about four percent of a facility’s replacement cost for maintenance and capital renewal. How did such a well-practiced policy compare to the City of Salida’s approach to building maintenance and capital renewal?
Four percent (4%) of the current replacement cost of the NRCDC’s proposed Forest Service office building was:
.04 x $3.4 million = $136,000 per year.
It might appear that the City of Salida should have been budgeting about $136,000 per year. Instead, their proposed budget was $18,613.
Are there other governments that are seriously underestimating the cost of maintaining and replacing their infrastructure?
Or should I say, are there any governments who aren’t underestimating? Is it, in fact, the nature of government to build stuff without giving the slightest thought to how much it will cost to maintain it?
Here, we’re listening to the conversation at the Archuleta Board of County Commissioners’ work session on April 11, where County Engineer Bob Perry has just explained that the new update to the County’s 5-Year Road Plan will focus only on paved roads Those roads constitute about 13 percent of the 338 miles of roadway maintained by the County government. (Additional miles are maintained by metro districts, or by private landowners.)
The gravel roads — the other 87 percent — will thus be maintained without the benefit of a long-range plan, it would appear.
County Administrator Bentley Henderson:
“The point of what Bob is talking about is that we’re concentrating on the paved surfaces, because they’re the most expensive to maintain. There’s a certain recognition that the annual maintenance protocols that we had in place are budgetarily driven. So having some [consultant] come in and say, ‘There’s a cul de sac 15 miles from Hinsdale County that needs $10,000 worth of work to even come up to minimum standards’ — our Public Works Department knows that, but right now we’re putting bandaids down, and trying to make them passable, so the residents who live there have a reasonable expectation of at least seeing it graded every year. Those kinds of things. The rest of it, is intuitive.
“So I think the desire to focus on those paved roads — given the expense of maintaining them — in my opinion, makes a lot of sense.”
Mr. Perry had just finished reminding us that maintenance of a mile of a paved road costs about 7 times as much as the maintenance of a mile of gravel road.
Commissioner Michael Whiting:
“Well, I think the expectations is different, in different parts of the county… based on my experience with the people who contact me… the people who live out in the weeds have a much different expectation about how their roads are going to be maintained, than the people who live in Pagosa Lakes. It’s a much higher expectation… I don’t know how that expectation got generated, and I don’t really want to go there… but I’d say there’s a higher expectation about road maintenance and improvements in Pagosa Lakes, than there is, say, out Four Mile, or out Trujillo.”
Be that as it may, the 5-Year Road Plan is apparently ready for its own improvements, and according to County Administrator Henderson, the Public Works Department has found a way to update the plan at a much reduced cost. The original plan cost in excess of $100,000. The budget for the update will run about $25,000.
In defense of his idea that only paved roads should be included in the 5-Year Plan, Mr. Perry noted that the Road & Bridge crew have a better understanding — from the perch in their road graders — of the immediate needs of various gravel roads, than could be found in any “plan” that might be three to five years old. Or even one year old, for that matter.
So there’s not a lot of value in planning, long range, the maintenance of the gravel roads, he suggested.
We might also wonder if there’s not a lot of value in planning the maintenance of the paved roads? If we don’t actually have the money to maintain them?
Maybe it’s time to simply grind up the asphalt, and turn them back into gravel roads?