City Council Approves New Downtown Reconstruction Project

SAN ANGELO, TX – The city council, in a 6-0 vote, has approved the adoption of a resolution for a new construction project, the Chadbourne Street Corridor Project, and the funding mechanisms proposed for the Project.

The new Chadbourne Street Corridor Project is a new beautification and street repair effort from the City. The Project, Assistant City Manager Rick Weise explained, would be broken into three areas: U.S. Highway 67/277 (Houston Harte) to Harris Avenue, Harris Avenue to Concho River, and Concho River to Washington Drive.

The cost of the project, which includes both street motorized and non-motorized transportation alternatives, is estimated to cost approximately $19,901,00, if implemented within the next 1.5 years. Of this estimated $20 million, $6,118,352 is grant-eligible under the TxDot program, TA Set-Aside program.

The TA Set-Aside Program provides funding to construct a variety of alternative transportation projects that improve mobility for non-motorized users and constructs on- and off-road pedestrian and bicycle accommodations. Furthermore, the TA Set-Aside Program, provides funding for construction of infrastructure for non-drivers to gain access to public transportation and safe 'Routes to School' infrastructure. However, if a city uses the TA Set-Aside Program, the project’s sponsor (the City) must commit to provide a local funding match of at least 20% of the allowable construction and department oversight costs. The sponsor must also submit to any allowable adjustment for authorized in-kind contribution.

The City knows that that the TA Set-Aside Program tends to approve grants to sponsors who overmatch anywhere between 25%-30%; therefore, the City has maintained to match the grant by 30%. Should the City receive the grant, the City will be required to pay an estimated $2,110,831. 

Weise understands that this project will be another costly construction project, so he provided the following funding options:

Above: Two Funding Options. Option A would allow the City to construct the Chadbourne Project from Houston Harte to Harris Street. Option B would allow the City to construct the Chadbourne Project from Houston Harte to the River.

This Chadbourne Street Corridor Project was proposed to the city council a few years ago, however the TA Set-Aside Program did not approve the City’s grant proposition. This year, the City hopes to acquire an estimated $4.9 million dollars form TxDot through their submitted grant proposal.

Despite Weise’s detailed funding proposition, many questions still remained on the specifics of the projects funding. One concern was the use of TIRZ money. TIRZ money has been split into two accounts, one account allocates funding for North San Angelo and the second account allocates money for South San Angelo. Many were concerned about the amount of funds being used from each account, as the proposed budgeting proposal suggested varied percent values for each TIRZ account to pay to fund the new project. However, after much debate, budget staff members advised that the difference in percentages did not mean one account was paying more than the other.

Another issue city council members saw, were the use of assessments to pay for the project.  Weise gave an example of assessing businesses $10 per foot, per year, for 10 years. However, Mr, Dwain Morrison, who was acting Mayor at the time, used Weise’s example and explained that a store that is 250 feet wide, with a $10 fee per foot charge, would be assessed $2,500/year. He added, the store would then have to pay the City $25,000 worth of tax money over the 10-year assessment period.

Mr. Morrison stated, “we also have a lot of churches, the bus depot and a lot of non-profits [on Chadbourne Street], so [the City has] a lot of people that are not paying taxes anyway and would not be assessed. [Therefore,] you’re going to add a tremendous amount of money to those property’s that [will be] assessed and I don’t want to double tax our businesses on this stretch.” Noting the $2 million deficit the City is already in, Mr. Morrison did not see the benefit of the assessment.

Another concern raised by councilwoman Lucy Gonzalez was the use of Street Funds in the proposed budgeting options. Shane Kelton reassured council members that the funds listed next to the "Streets" budget option, had already been budgeted; however, Weise did note that the council might need to look into using the street fund as a monetary safety net.  This would mean the funds to re-construct streets such as Bell Street, may see minimal to no impact.

However, after an hour-long debate, Marty Self moved to approve the proposed funding for Option B, but omitted the $600,000 in special assessment dollars to be addressed in a future meeting and approved the TIRZ North account to use 25% and the TIRZ South account to use 15 % of their budgets to pay for the project.

The motion passed with a 6-0 vote.

The City will submit their grant proposal by May 22. Please click here to watch the full debate.

The next city council meeting is scheduled for June 6, 2017 at 8:30 a.m. in the McNease Convention Center.  As always, city council meetings are free and open to the public.