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Report regarding proposed Capital Improvement Program for the Fiscal Year 2025-26. (Eunejune Kim, Director of Public Works/City Engineer, and Matthew Ruble, Principal Engineer)
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RECOMMENDATION
Staff recommends that the Budget Standing Committee of the City Council review and provide feedback on the proposed Capital Improvement Program for the Fiscal Year 2025-26.
BACKGROUND/DISCUSSION
The Capital Improvement Program (CIP) outlines large capital expenditures and infrastructure improvement projects throughout the City. City departments identify necessary improvements and prioritize project implementation when preparing the CIP.
City staff considers the following criteria when selecting projects for inclusion in the CIP:
• Grant-funded projects requiring a City contribution
• Previously approved projects under construction or contract
• Projects required for regulatory compliance
• Projects to maintain or upgrade existing City infrastructure
• Projects with no General Fund allocations
• Projects requested by the community or City departments
Based on these guidelines, staff proposes the following Fiscal Year (FY) 2025-26 CIP budget appropriations. The proposed FY 2025-26 CIP budget is $231.82 million, with $24.03 million of new appropriations and approximately $207.79 million of appropriations from prior fiscal years for continuing projects. In addition, the City continues to work diligently to identify projects within Infrastructure Reserves and Sewer Enterprise Funds to be redirected back to the City’s budget to help support the CIP budget needs for FY 2025-26 and out-years. These projects are included in a separate attachment, along with other funding sources and projects that the City has identified for either closeout or deferral. As these projects are anticipated to be eliminated or deferred, they will not be included in the FY 2025-26 Budget Book.
CIP Project Summary
The FY 2025-26 CIP includes 186 projects: 10 new projects and 176 continuing projects.
The CIP is comprised of six (6) project types:
• Public Facilities
• Parks
• Storm Drains
• Sanitary Sewer
• Streets
• Traffic
The following brief overview identifies proposed new projects and additional appropriation requests for continuing projects.
Public Facilities Projects - These projects renovate, construct, and improve city buildings and infrastructure.
New appropriations requests:
There are no new public facilities appropriation requests for Fiscal Year 2025-26.
Total New Public Facilities Appropriation Requests = $0
Parks Projects - These projects replace and improve playgrounds, renovate baseball fields, and expand parks at city-owned public spaces.
New appropriations request:
• (pk2301) Orange Memorial Park Main Playground Replacement (BONDS) - Surfacing and equipment replacement of main playground at Orange Memorial Park. Equipment to be replaced with inclusive elements for all-abilities. - $865,073.24
• (pk2302) Centennial Trail Improvements - Construct park spaces along Centennial Trail. - $1,666,279
• (pk2305) Linden Park Project - Project to transform two adjacent vacant lots into a vibrant neighborhood park and cultural plaza for our community to enjoy. - $300,000
• (pk2501) Dedicated Pickleball Courts - Addition of Pickleball courts to Orange Park; additional costs to add noise attenuation and improved surfacing. - $400,000
• New project (pk2601) Cypress and Pine Park Renovation Project - Improve and rehabilitate the existing Cypress and Pine Park with new play features, furnishings, landscape, and other improvements. - $3,000,000
• New project (pk2602) Playground Surfacing City Hall Tot Lot, Avalon Park, Westborough Park - Replacement of rubberized surfacing that has reached end of life and is degraded beyond patch repairs. - $180,000
Total New Parks Appropriation Requests = $6,411,352
Storm Drain Projects - Projects repair and improve storm drains and infrastructure to reduce pollution run-off into the San Francisco Bay.
New appropriations request:
(sd1801) Orange Memorial Park Stormwater Capture Project - Design and construct a storm water capture device including pre-treatment system. - $20,000
Total New Storm Drain Appropriation Requests = $20,000
Sanitary Sewer Projects: Projects maintain the Water Quality Control Plant (WQCP), Collection System Pumps Stations, and sanitary sewer lines within the City.
New appropriations request:
• (ss2202) Oyster Point Pump Station - The project will design and construct a new pump station to support the development at Oyster Point. - $2,850,000
• New project (ss2601) Sanitary Sewer Rehab FY 2025-26 - Annual systematic rehabilitation of the sewer system gravity lines by sewer basins as determined by the sewer master plan and recent video inspection efforts prior to Surface Seal Area 2. - $5,800,000¹
• New project (ss2602) Harbor Way Sewer Main Upsize - Upgrade of sewer main due to capacity constraints. - $500,000
• New project (ss2603) Sanitary Sewer Pump Station Master Plan - Condition and Capacity assessment of all Pump Stations and associated force mains. - $500,000
Total New Sanitary Sewer Appropriation Requests = $9,650,000
Streets Projects: These projects repair bridges, resurface streets, improve medians and sidewalks, and study the feasibility of proposed roadway and rail extensions.
New appropriations Request:
• (st1703) Bridge Preventative Maintenance Program - This project will conduct preventative maintenance on nine (9) city-maintained bridges including: Colma Creek Bridge at Produce Avenue, Canal Bridge at Linden Avenue, two (2) bridges over San Bruno Channel over North Access Road, Colma Creek Bridge at Spruce Avenue, Colma Creek Bridge at Utah Avenue, Grand Ave. and San Bruno Channel over North Access Road. - $200,000
• (st1904) Underground Utilities District (UUD) Rule 20A for Mission Road - Establish an Underground Utility District on Mission Road from Grand Avenue to connect with underground utilities at the South San Francisco BART south entrance. Additional funding is required to replace city-owned street lighting. - $1,500,000
• (st2301) Junipero Serra Boulevard/Westborough Boulevard Corridor Feasibility Project - To fund the planning of the Junipero Serra Blvd and Westborough Blvd Bike and Ped improvements as identified in the Active South City Plan - $200,000
• (st2505) 2026 Surface Seal Project - This project will provide asphalt pavement maintenance from design through construction in Area 2 (Sierra Highlands neighborhood) of the Pavement Management Program (PMP). - $3,300,000
• New project (st2601) Tanforan Ave Reconstruction - Reconstruction of Tanforan Ave between San Mateo Ave and Railroad Place. - $100,000
• New project (st2602) Citywide Misc Striping - This project includes the installation, replacement, and maintenance of roadway striping and pavement markings at various locations citywide. - $300,000
• New project (st2603) Citywide Trip Hazard - Funds to be used to mitigate trip hazards identified as part of the trip hazard assessment. - $150,000
• New project (st2604) 2027 Surface Seal - Street surface treatments with base repairs in preparation of 2027 surface seal project. - $200,000
• New project (st2605) 2026 Pavement Repair and Crack Seal - A preventive maintenance program that includes repairs to localized defective pavement areas and crack sealing - $1,000,000
Total New Streets Appropriation Requests = $6,950,000
Traffic Projects: These projects focus on arterials, corridors, and key intersections within the City including adaptive traffic signals to provide better traffic flow, improve pedestrian safety, traffic calming, and better bicycle rider safety on city streets.
New appropriations Request:
• (tr2002) Smart Corridor - Implementation of Intelligent Transportation System (ITS) along segment of 101 corridor north of I-380. - $350,000
• (tr2301) Miscellaneous Traffic Improvements - Design & construct any traffic related improvements in the City, such as striping, signs, and other traffic calming measures from the Traffic Advisory Committee, Neighborhood meetings or as needed. - $250,000
• (tr2406) Traffic Studies and Grant Support - Support for any traffic-related studies from the Traffic Advisory Committee, Neighborhood meetings or as needed, and support for grant applications as needed. - $100,000
• (tr2415) Colma/SSF ECR Bicycle & Ped Improvement - Part of Bike/Ped master plan - $300,000
Total New Traffic Appropriation Requests = $1,000,000
Infrastructure Reserve Refund: To release financial resources for urgent needs, the City has decided to release Infrastructure Reserves previously allocated to four projects, three of which will be closed. This action will enable the City to redirect funds toward projects that require immediate attention.
• (st1803) Street Lighting Enhancement - ($200,000)
• (st1805) ECR Gateway Sign & Median Improvement (Noor/Spruce) - ($42,985.38) CLOSE
• (st2002) Survey Monument - ($125,000) CLOSE
• (st2305) CDBG Curb Ramp Replacement - ($150,025.86) CLOSE
TOTAL REFUND TO Infrastructure Reserve = $518,011.24
Sewer Enterprise Fund Refund: To support sustainable resource management, the City has thoroughly reviewed current and upcoming projects dependent on Sewer Enterprise Funds. As a result, four projects are recommended for closure and nine for deferral. Additionally, two projects will be reclassified and moved to the Capital Outlay Fund. These actions will release a total of $11.87 million back into the Sewer Enterprise Fund to support critical needs in FY 2025-26 and future years.
• (ss1301) WQCP Wet Weather and Digester Imprvmts - ($564,441.59) CLOSE
• (ss1601) Sodium Hypochlorite Tank Replacement - ($57,201.08) CLOSE
• (ss1703) WQCP Secondary Clarifiers #1 & #2 Rehab - ($1,316,576.22) CLOSE
• (ss1704) WQCP Effluent Storage Basin Liner Rplmnt - ($855,993.07) CLOSE
• (ss1307) Plant Wide Industrial Re-Coat - ($2,000,000)
• (ss2302) WQCP Sludge Dewatering Improvements - (1,393,290)
• (ss1205) WQCP Solar PV - ($270,356.94)
• (ss1901) Pump Station Industrial Re-Coating Prog - ($2,125,266.56)
• (ss2301) WQCP Diffused Air Flotation Thickener Re - ($548,100)
• (ss2404) Programmable Logic Controller Repl-WQCP - ($1,498,140)
• (ss2407) SB1383 Organic Diversion Mandate Comp - ($73,080)
• (ss2408) Biosolids Drying & Recycling- Proj #2 - ($73,080)
• (ss2501) Sanitary Pump Stations 5, 6, 7 Upgrade - ($219,240)
TOTAL REFUND to Sewer Enterprise Fund = $10,994,765.46
Additional Project Closures/Refunds:
The City has also identified three additional projects for adjustment across other funding sources. One project will be closed, resulting in an additional release of $1,165,073.24. These actions are intended to align remaining project balances with evolving capital priorities and funding needs.
• (pf2205) Oyster Pt Phase 2C Parking Lot Improve - ($150,000)
• (pf2206) Oyster Pt Phase 2C Landscape Improvement - ($150,000)
• (pk2309) OMP Sports Field Renovation (BONDS 522) - ($865,073.24)
TOTAL REFUND to Other = $1,165,073.24
FUNDING
This staff report outlines the proposed allocations for the FY 2025-26 CIP budget totaling $231.82 million, which includes $24.03 million in new appropriations and approximately $207.79 million in carryforward funding for ongoing projects. To support financial efficiency, the City has identified $518,000 in Infrastructure Reserve refunds, $10.99 million in Sewer Enterprise Fund reallocations, and $1.2 million from additional project closures.
Funding allocations by source and project are detailed in Attachment 1 - FY 2025-2026 Funding Source Summary, while Attachment 2 - Excerpts from the One-Year CIP Proposed Budget provides a visual breakdown of new appropriations. Attachment 3 - Proposed Project Closures and Deferrals outlines projects identified for closeout, deferral, or reallocation.
This strategic approach reflects the City’s commitment to responsible fiscal management and aligning capital investments with critical infrastructure priorities.
CONCLUSION
Staff will amend the FY 2025-26 CIP based on direction from the Budget Subcommittee and present the revised CIP at the Special City Council Study Session June 7, 2025.
Attachments:
1. FY 2025-2026 Funding Source Summary for All Appropriation Requests
2. Excerpts from the FY 2025-2026 One-Year CIP Proposed Budget
3. Proposed Project Closures and Deferrals
¹ Funding request is contingent upon City Council approval of the staff report scheduled for May 28, 2025, which proposes fund transfer reimbursing Sewer Fund (710) with applicable Sewer Capacity revenue.