NTF Issue paper: ccwatch113.doc. 2-20.

BACKGROUND. The street network in the City of Omaha undoubtedly is in inferior structural condition, urgently in need of major reconditioning. Streets are deteriorating at a faster rate than basic maintenance funding can repair them. The current budgetary allotment cannot provide sufficient funding to replace and restore this network in order to keep ahead of increasing deterioration. Therefore, city government must provide a funding mechanism(s) to begin restoring and repairing the road network for safe and convenient use. Our NTF organization is providing city government a number of suggestions to reach these objectives.

PAYING THE BILL. All current suggestions for financing street repair and renovation involve revenue increases. These options include increasing the wheel tax, which has risen several times already, levying an occupation tax, a property tax hike, or a bond issue paid for by our property taxes. Mayor Stothert asked the City Council to approve a $200 million general obligation bond issue on which residents can vote in the May 12 primary. This bond issue would increase property taxes by $52 on a $200,000 home, $65 on a $250,000 house. Increased taxes would begin in the 2022 tax collection year. This bond funding would allow the city to spend $75 million annually. However, this bond issue would not cover the entire cost of renovating Omaha streets. Additional bond issues would become necessary in future years. And the initial bond issue would not cover city construction equipment or labor costs. The plan claims that every lane mile in Omaha could see resurfacing over its 20-year average lifespan. However, many sturdy streets do not require attention after only 20 years, and some street reconstruction projects deteriorate too soon.

NTF SUGGESTIONS. Though this bond issue is necessary, we suggest a revised proposal. Congressmen sometimes include an offset when requesting a spending increase, offering a spending cut of equal or lesser amount than the sum requested for the increase. The city budget includes funding for basic city services which every city must and should provide for its citizens. Examples: police and fire protection, parks, and physical infrastructure, including streets and sewers. However, the city also spends millions of dollars on items that do not classify as necessary, basic services. Below is a short listing of such services that the city could suspend for several years or eliminate permanently, barring contracts, until the street network becomes rehabilitated:
• End appropriations to the Omaha Zoo Society, saving $2,137,200.
• End appropriations to the Holiday Lighting, NE Humane Society, Summer Jobs, YOUTURN, Rejuvenating Women, Youth Emergency Services, and Truancy Prevention programs, saving $1.7 million.
• End appropriations to Heartland Workforce Solutions, which is duplicative of other programs, saving $661,164.
• Eliminate neighborhood grants.
• Sell off the remaining Byron Reed coin and manuscript collection, worth $2.8 million.
• End the Parks Dept. Public Awareness Division, saving $182,300.
• End Convention & Tourism Dept. Restaurant Week and Tourism Awards to save $58,040.
• Convention services, specifically economic impact of groups, organizations serviced, hotel rooms utilized, hotel revenues, taxes generated by hotel revenue, and number of visitors served all are decreasing, more reason to require private entities that benefit to pay more of Convention Department costs.
• End subsidies for residential utility ratepayer assistance.
• Stop funding for Healthy Futures.
• Stop funding for Omaha By Design.
• End provision of library materials to nursing homes, hospitals, senior citizen residents, and those confined to their homes. Also, end visits to schools, preschools, and daycare centers to promote literacy and reading.
Solicit non-government financing. Philanthropic groups, private foundations, and an array of nonprofit organizations are showing a greater interest in investing in local infrastructure. These organizations can offer either donations or grants with a charitable purpose to support street renovation and repair. Such would allow the city to leverage a large amount of financing quickly while relieving pressure on public financing.

CUTTING EXPENSES. The city administration could lessen the amount of funding needed to restore our street network to satisfactory status by utilizing technology and other cost-cutting measures for a long-range plan, in addition to its current efforts. For example, Roadbotics, engineered by Carnegie Mellon University, focuses on monitoring the status of streets before crews needed to fill potholes or fix other problems. Using a smart phone mounted on a vehicle windshield with camera facing out, employees could drive our streets and gather video of street conditions and GPS locations of stretches that require immediate attention. Drivers merely turn on an application that collects video from a street and sends the data to a cloud. The company then uses artificial intelligence to analyze the road surface. This activity is speedier and more cost-efficient than relying on citizen complaints or sporadic inspections. Kansas City, MO. is re-evaluating how it conducts street maintenance by utilizing data collected by its Smart City Program to predict where potholes will occur. This system combines details from weather data, traffic volume, and pavement conditions to predict pavement problems. The city saves money by using preventive maintenance rather than waiting to repair problems. This city ran an algorithm against street data from 2003 to 2012 and predicted where potholes would appear with 76% accuracy. The integration of technology-guided preventive maintenance allows cities to use materials and equipment already pegged for maintenance work through a more sophisticated system. 40 municipalities contract with a Pittsburgh company that uses smart phone cameras with algorithms to create color-coded maps of street networks that show where potholes, cracks, and bumps will appear in pavement and then conduct preventive maintenance.

CONTRACTS. Currently, contractors who perform repair and renovation work on Omaha streets must guarantee their work for only 2 years. In some instances, this work begins to deteriorate even before the 2- year period expires. Asphalt overlays show bumps, cracks, and holes much too soon. The city should require contractors to guarantee their work for a longer period of time and exert increased vigilance over work performed. Do not hire contractors whose work record appears shoddy, even if they are the lowest bidder. Use more concrete paving than asphalt, as more durable concrete paving has a longer life span. Ensure that the concrete ingredients are of high quality. Recall that ash mixed into concrete caused pavement to crumble on south 144th Street. Mandate or show preference for the use of permeable pavements that allow water to flow through them. Open-graded asphalt uses a combination of rocks on top of stone aggregate, so that rain can pass through. Use of such asphalt and concrete materials that absorb rainwater and snow melt prevents street flooding, freeze/thaw cracking, and sewer plugging, especially welcome during heavy rainstorms and snowstorms and the use of salt on our streets. In contracts, use flexibility in scheduling, number of working days instead of a set completion date. Package multiple small projects into a larger project to save money.

NONPROFITS. Nonprofits could pay a fee in lieu of property taxes called PILOTS (payments in lieu of taxes), already current in several states. Adding this revenue would require action by the state legislature. This revenue would add millions to city coffers and provide long-range financing for street upgrades.

TAKE ACTION NOW. NTF commends Mayor Stothert for advocating that the final plan requires a public vote. The city budget cannot absorb this new cost. Difficult as it is to endure higher taxes, this bitter pill we must swallow. However, raising property taxes alone is not the only method to finance Omaha street repair and reconstruction through bonding. Politicians find it easier to hike revenue than cut spending or lower other taxes. However, ending spending on non-basic city services and other measures, or mandating across the board department cuts, even if for only several years, can help finance needed street improvements and lessen the increased tax bite. The Stothert Administration is paying off old bonds and refinancing current ones, actions that relieve pressure on the city budget. The $19 million debt on the convention center will disappear soon. Bonded debt paid off early. Union contract costs reined in. The Mayor and city council should work with taxpayers on this crucial bond issue. Use the above content to lobby your Omaha city council member and Mayor on the street crisis. Email netaxpayers@gmail.com for city council contact information and to join our City Watch Project.

Research, documentation, and analysis for this issue paper done by Nebraska Taxpayers for Freedom. This material copyrighted by Nebraska Taxpayers for Freedom, with express prior permission granted for its use by other groups in the NE Conservative Coalition Network. 2-20. C

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