August 10, 2004

SUBJECT: Federal Surface Transportation Program Funds for Local Streets and Roads Rehabilitation Projects – Authorization to Submit Grant Application and Resolution of Support

REPORT IN BRIEF

This report recommends that the City Council authorize staff to submit a grant application for Federal grant funds allocated to the City for roadway rehabilitation.  Assuming that candidate projects meet the project screening criteria, an allocation of $1.18 million will be granted to the City through a VTA-approved program.  The program requires an 11.5% local match.  Budgeting of necessary funds for this project would be carried out as part of the FY 05/06 Capital budget development process.   The program requires the approval of a resolution of support committing to complete the projects and provide local matching funds.  Staff recommends approval of the attached resolution (Attachment 1).

BACKGROUND

An allocation of Federal Surface Transportation Program funds has been made to the Bay Area and subsequently Santa Clara County for FY 05/06 and FY 06/07 budget years.  These funds are for rehabilitation of major local roadways that are part of the Metropolitan Transportation System (MTS) and have fallen below a certain pavement condition as measured by the Metropolitan Transportation Commission Pavement Management System (MTC PMS).  Agencies with no MTS needs can apply the funds for rehabilitation of other major, federally eligible roadways in their jurisdiction.  Through a task force process of city, county and Santa Clara Valley Transportation Authority (VTA) staffs, pavement rehabilitation needs throughout Santa Clara County were considered and a needs-based allocation made to each Santa Clara County jurisdiction.  Sunnyvale’s allocation is $1,185,183.  Sunnyvale staff participated on the allocation task force. 

Local agencies must submit an application for candidate projects for this special program to VTA.  Projects will be screened for compliance with federal and local eligibility criteria. The VTA prioritizes the submitted projects and then submits their list of recommended projects to the MTC for approval. MTC approves the projects with instruction to implement the projects within three years of the funding year. The City implements the approved projects and then submits paperwork to Caltrans District 4 to be refunded for the money expended.

EXISTING POLICY

The following documents contain policy direction on this issue:

Land Use and Transportation Element C3.4, Maintain roadways and traffic control devices in good operating condition.

Fiscal Sub-Element 7.B.4c, Utilize a uniform grants application process to assure that the City Council has the information necessary to make a decision regarding a potential intergovernmental grant.  Staff should present to Council a notice of intent regarding a possible grant source which shall include at least the following information:

1.         The grant being pursued and the use to which it would be placed.

2.         The objectives or goals of the City which will be achieved through use of the grant.

3.         The local match required, if any, plus the source of the local match.

4.         The increased cost to be locally funded upon termination of the grant.

5.         The ability of the City to administer the grant.

Fiscal Sub-Element 7.1B.4d; Pursue and use intergovernmental assistance for projects in the Ten-Year Capital Improvement Plan.

DISCUSSION

Per City policy, staff is requesting Council approval of submittal for these grant funds.  Eligible roadways must meet the MTC PMS criteria and federal eligibility requirements.  Staff has determined that segments of Mary Avenue, Fair Oaks Avenue, Kifer Road, and Hollenbeck Avenue are eligible for the Program in the time frame for funding.  Staff recommends that Gas Tax Reserve funds in the total amount of $154,007 be budgeted as local matching funds over two fiscal years, FY 05/06 and FY 06/07.  Should the Council approve submittal of a grant application, these funds would be budgeted as part of the FY 05/06 Capital budget development process.  This grant will be administered through existing Public Works operating budgets.  There will be no increased costs subsequent to completion of the project and termination of the grant.

FISCAL IMPACT

These funds will be added to the 10 Year Resource Allocation Plan in FY 05/06 and FY 06/07 as a new capital project, Pavement Rehabilitation of Sunnyvale Major Streets.  Granting of $1.18 million in unanticipated revenue constitutes a positive fiscal impact.  Staff recommends that Gas Tax Reserve funds in the total amount of $154,007 be budgeted as local matching funds over two fiscal years, FY 05/06 and FY 06/07.  Should the Council approve submittal of a grant application, these funds would be budgeted as part of the FY 05/06 capital budget development process.  

PUBLIC CONTACT

Public contact was made through posting of the Council agenda on the City's official notice bulletin board, posting of the agenda and report on the City's web page, and the availability of the report in the Library and the City Clerk's Office.

ALTERNATIVES