This accompanying story describes the extent of the challenge facing Moab in fixing its infrastructure and its cost, which will take years to cover.
The critical challenges with Moab’s infrastructure that must be addressed in the coming years are numerous and expensive, according to City Engineer Chuck Williams and Public Works Director Oscar Antillon. The critical and severe needs alone will cost $74 million to address, according to Williams, and meeting the moderate and less severe problems will only add to that cost.
Williams and Antillon, alongside heads of the city’s departments for roads, sewer, water, parks and facilities, recently gave a two-hour presentation at a city council meeting to highlight the urgency of the problems. They overviewed the common issues ailing Moab’s public infrastructure, how much it will cost to fix them, and possible strategies for mitigation.
Mayor Emily Niehaus, at the conclusion of presentations, said that she had three priorities for getting the city from its current capital project spending to where it needs to be – diversified income, project prioritization and borrowing – and as the city faces the monumental investment challenges that lie ahead, staff has already been developing tools to help in these areas.
Diversified income and economy
The “diversified income” that Niehaus mentioned refers to two things, and possibly a third: Economic diversification, external funding sources for capital projects and a property tax, respectively.
Economic diversification in Moab would mean more kinds of businesses in town offering a greater variety of services and products. Whereas tourism, and lodging in particular, represent a large share of Moab’s economic pie, diversification would grow the pie by strengthening the representation of other business types in Moab’s economy.
This diversification would decrease the city’s reliance on tourism for its collective wellbeing and improve the stability of its tax base. A diversified economy, the idea goes, would create opportunities for local workers to get jobs in other sectors, for investors to put money into Moab businesses, and for consumer spending to stay local rather than leaving to Grand Junction businesses or national entities like Amazon.
An example of external funding, which is the second illustration of diversified income, is the new parking garage planned for Main Street. The project will provide an alternative to on-street parking, and it is funded in full by the Utah Department of Transportation.
Numerous other state and federal entities offer loans and grants to municipalities for projects like the planned parking garage, and although Moab officials will have to lobby and apply for those funds, winning that money can significantly lessen the burden on local taxpayers to cover the cost of major projects, particularly when they benefit more than just locals.
A property tax is the possible third way the city could diversify its revenue sources. Property owners in Moab currently pay property taxes to a multitude of special service districts, the county and the Grand County School District, but not to the city. This is rare around the country, and in Utah in particular; of the 247 incorporated cities and towns in Utah, Moab is one of three to not levy a property tax.
A property tax would offer stability to the city’s budget, which currently relies heavily on waves of tourism to fund public services. Although local officials agree that tourists should represent the bulk of the city’s tax revenue since they represent a bulk of the impacts to city infrastructure, a property tax would grant the city more stability in its budget, since the state does not restrict property taxes the way it restricts the transient room tax and sales taxes.
Triaging the city’s laundry list of critical projects
Second on Niehaus’ list of priorities for tackling Moab’s infrastructure challenges is to rate by importance the capital projects that are on the city’s plate. For example, critical maintenance on the city’s sewer system, a major failure of which could mean backflow of sewage into residents’ sinks and tubs, will likely take higher priority than the construction of a new gym on Center Street.
The city is systematizing how it prioritizes its long list of capital projects with a grading rubric. The rubric will be used to give a prioritization score to each project based on a handful of criteria, including the project’s category, how the project aligns with the city’s strategic plans, the risk associated with the project, and how the project will be financed.
Examples of projects that would be considered high priority are those that can be funded in full by state or federal funds, low-risk investments, projects that are directly aligned with the city’s strategic plans and projects that, if not pursued, could lead to legal liability for the city.
This rubric is currently being calibrated by city staff members who will evaluate example projects with it to see what criteria should be emphasized or de-emphasized, and whether additional criteria should be added.
From there, the city council will appoint a three-person committee that will evaluate all of the capital projects, and that evaluation will form the basis of how the city prioritizes its capital investments over the coming years.
Taking on debt responsibly
Third and finally on Niehaus’ list of priorities is the city taking on debt. State and federal funds will only go so far in providing the revenue that Moab needs to update its roads, pipes and buildings; the city will also have to be somewhat self-reliant in making those upgrades on its own dime.
Rachel Stenta, the city’s finance director, recently presented a debt policy that the city council passed. The plan lays out guidelines on when it is appropriate for the city to borrow money and how it should do so.
For example, the new guidelines encourage the city to, when necessary, fund certain one-time investments via borrowing but to avoid funding ongoing costs, such as wages and regular maintenance, with debt.
As for what are next, project evaluations and the outcome of grant applications will have an effect on what projects the city pursues first. Creating an infrastructure strategy has been the first step.