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A Newsletter by the City of Saco, Maine	March, 2005	Return to newsletter index

City of Saco 5-Year Capital Improvement Program

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The Capital Improvement Program (CIP) provides a basis for prioritizing and implementing the short and long range plans for city acquisitions and projects. The CIP is intended to be a planning document for the departments and a coordination and scheduling document for the entire city organization. It further assists in coordinating the schedule of large expenditures over a period of years both for better fund management and for cash management purposes. The CIP serves as a link between the following plans and their implementation: the Comprehensive Plan, School Facilities Plan, Combined Sewer Overflow Plan, Downtown Plan, Storm Water Management Plan, Beach Management Plan, Landfill Recreation and Reuse Plan as well as other plans as may be developed. It is one of the methods used in building a disaster resistant community. It helps to reconcile the timing of projects with the availability of financial, manpower and equipment resources. The Capital Improvement Program also serves to enhance the city's credit ratings and helps reduce fluctuation in the tax rate and debt service requirement.

The effectiveness of the CIP relies on the professional assessments made by practitioners employed by city departments. The completed city CIP schedule is assembled from the assessments and priorities defined by departments on a combined priority matrix. Special consideration is given to projects, which should be combined for maximum efficiency. The Finance Director assembles and coordinates the final city CIP document that is ultimately presented to the City Council by the City Administrator.

The CIP is updated annually as a precursor to budget preparation, at which time individual project timing can be adjusted, new projects added, and outdated projects removed. It is important to note that even though funds reserved for capital improvements are dedicated and maintained separately from other city funds, the CIP forecasts are only informational and are based on current expectations and priorities, which are not binding. However, annual budget decisions are made as a result of the information assembled in the CIP process. The goal of the CIP is to create the most accurate view of future city needs so informed coordinated decisions can be made throughout the budget process. The city is never obligation to proceed with a project simply because it was approved as part of the CIP. If a project is no longer needed the city will realign reserved capital funds to reflect the most urgent capital needs each year.

A carefully planned and prepared Capital Improvement Program enables the city to realize a number of benefits.

1. Major expenditures can be anticipated in advance rather than being overlooked until needs become critical.
2. Coordinating projects can reduce total costs through bulk discounts, competitive pricing, and project coordination.
3. City projects can be evaluated based on relative need and importance.
4. Projects can be timed to capitalize on sales in the marketplace.
5. Projects can be coordinated to capitalize on the best available funding options including grants and bonds.
6. By identifying capital needs prior to budget preparation all requests can be evaluated and prioritized, then adopted and integrated into the budget as a whole. The Charter for the City of Saco, Article VI. Financial Procedures Section 6.05 Capital Program, requires the City Administrator to prepare and submit to the City Council a five-year capital improvement program in March of each year. The Charter further provides that the Council will after hearing, adopt a capital program on or before the first regular meeting in June. The city's Capital Improvement policy and program furthers these Charter requirements.