Fluent Essays

Section I: 15 points. Answer one of the following two questions.1) The Town of Banff, located in Banff National Park (2564 square miles) of Alberta Canadahas a population of 6,700 and is only 1.9 square miles. The Park is a major destination fortourists from all over the world with its breathtaking views of the Canadian Rockies andclose access to the Park’s amenities. As only one of two towns in the park (which is adjacentto Jasper National Park that is 4200 square miles), the town is a primary service center forpark visitors and home to many resorts, hotels, and other commercial enterprises that cater totourists. Although the town was established in 1880, recent growth and environmentalpressures have facilitated its relatively recent incorporation in 1990. The town has amanagerial form with 6 council members. The town has a long-range financial plan, anoperating budget, a capital budget, a capital plan, a community plan, and severalredevelopment plans.The town will undertake its most expensive and comprehensive capital project to replace allpublic infrastructure for 8 blocks (approx. 1 mile) on its main street. This infrastructure to bereplaced includes the following: a 4 lane road, street lights, sidewalks, storm sewer, sanitarysewer, water lines, and traffic signage. This road is the main thoroughfare through the town,and so is well-traveled by thousands of tourists and residents during the summer.Additionally, the majority of the non-resort commercial enterprises of the village are locatedin this 8 block portion that includes restaurants, tourist shops, grocery stores, clothing andjewelry stores, etc., so there is a great deal of foot traffic in this area during the day and wellinto the night. (Keep in mind that, although small in terms of population, Banff’s populationdensity is high.)As the municipal manager of this town, it is your responsibility to manage this project.Explain the primary activities you must engage in to plan, finance, and implement theproject. Identify and describe the primary issues or problems you are likely to encounterand the major decisions you (and your team) will make in planning, financing, andimplementing the project. The project must be completed in a short amount of time assignificant snowfall and freezing begins in early October and does not end until early-May.Make sure you target your comments to this capital project specifically and not capitalprojects in general.2. The Village of Madison is a middle-ring suburb in a major metropolitan area. Itsboundary almost encompasses an unincorporated area of about .8 square miles. Thatunincorporated area contains a large trailer park in the center (Section B), and someundeveloped land further away from the city (Section C). That area has been used as adumping area, probably by the residents of the trailer park (who have to pay for garbagepick-up from a private hauler) and nearby residents who want to dispose of large itemsfree of charge. The village provides most of the police and fire protection to theunincorporated area through reciprocity with the county, which cannot respond as fast asthe village. Thus, much of the village’s services to this area are pro bono. Additionally,there are concerns that the septic systems of the trailer park are not being maintainedappropriately by the trailer park owners, and are leaking pollutants into the village’s wellsystem. The trailer park currently has its own well, but water pressure and quality isinadequate. The village is under a great deal of pressure from its citizens to annex thearea, eliminate the trailer park, and bring in more desirable development.One of the primary concerns of the village is that developers may not be willing toprovide the necessary infrastructure to support the development. In addition to sanitarysewers, the area will need water mains, road improvements on major streets, lighting,signage, sidewalks, a retention pond to hold rainwater, and an improved drainage systemfor storm water. Road improvements that link Sections B and C will require the villageto build a new bridge over a small river to meet load standards. Ultimately, the villagewill also need a new fire station to service the entire area and nearby sections of thevillage. (Given population growth on the border with the unincorporated area, the villageis close to requiring a new fire station currently.) The portion of the unincorporated areathat is closest to the village (Section A) comprises about ½of the unincorporated landarea. This section has the most miles of roads and commercial enterprises that providegoods and services to the portion of the town that is closest to the total unincorporatedarea and the trailer park.Using the data in Attachment 2Fa (.pdf or .xlxs) and figure Attachment 2Fb, construct a5 year capital budget that distributes the projects in a logical order over the 5 year timeperiod and meets revenue and debt constraints. The city plans on issuing $5 million indebt for capital projects in the first year, and it can contribute an additional $2.5 millionin grants and own-source revenue in the first year. However, the city estimates that it cancontribute only $2 million each year after that (in years 2 – 5) from own-source revenuesand intergovernmental grants.Make sure you explain your answer and budget figures.Section II: 15 points. Answer one of the following two questions. Show your calculationsand explain your answers to obtain partial credit. Please put your excel file on Blackboard if youcreate one.3) The finance director has assigned you the task of doing an analysis of the water chargesthe town issues to resident customers and other municipalities. The city owns andoperates 3 large wells from which it provides water to its own citizens and four smallersurrounding communities. Water is sold to each of the surrounding communities as onelump fee based on volume, but it is sold to its citizens based on metered use perconnection. Your task is to determine whether charges to the citizens and surroundingcommunities are appropriate relative to usage and the operational and capital needs of thewater fund. Town officials recognize that the water sold to surrounding communities issubsidizing the water used by its citizens, and many feel that this is appropriate to someextent. However, nobody really knows the size of the subsidy because they don’t reallyknow how much it costs the city to produce a gallon of water. Currently, water chargesto citizens are based primarily on looking at what other communities are charging itscitizens, charging less than that amount to its own citizens, and then charging thesurrounding communities enough to make up the difference based on the percentage oftotal gallons sold.Using the figures in Attachment 3F (.pdf or .xlxs), do the following:1) Using an average cost approach (not a marginal cost approach), determine howmuch it costs the town to provide a gallon of water to citizens and surroundingcommunities considering all direct, indirect, and depreciation expenses. Note thatthe cost to citizens is different than the costs to surrounding communities. Todetermine varied costs, consider that some expenses should not be borne by thesurrounding communities that purchase water.2) Determine how much citizens and surrounding communities are currently beingcharged for a gallon of water and what the charges should be if subsidization ofwater service to citizens by surrounding communities were not occurring (usingan average cost approach).3) Identify any other problems with the current water charges issued by the city, andexplain how you distribute administrative costs.To answer this question correctly, you will need to distinguish direct from indirect costsand distribute indirect costs in a reasonable way.4) The costs of disposing of solid wastes has skyrocketed in the last 10 years due to limitedland fill space that has increased the need for recycling solid wastes. Currently the cityhas a cart system in which all garbage (recyclable, and non-recyclable) is placed byhouseholds into the same cart, which is disposed of by the city in the same refuse packingtruck. Garbage carts from single family and duplexes (two-family) households areretrieved from their permanent storage location, usually the back of the house ordriveway, by the city worker and brought to the truck on the street. Condominiums,apartment complexes, and private businesses use a dumpster system with separaterecyclable and non-recyclable bins and collection of this refuse is contracted out. Thecity makes no attempts to sort or recycle the house and duplex garbage after it iscollected.The city’s finance director has charged you with doing an assessment of the average costsassociated with three options for collecting house and duplex refuse. These options areexplained below, but you will need to make some assumptions to complete this question.A) Contract out the entire system: private firms agree to use their trucks andpersonnel to collect the garbage and sort it after collection. The city is responsiblefor providing and replacing the garbage carts, but this option does not require newcarts or increasing the number of carts provided to each resident and duplex.However, the contractors will not retrieve the carts from their permanent location,so citizens must bring them to the curb for pick-up on designated days.B) Purchase new carts and replace entire fleet of packing trucks with new model truck:purchase an additional cart for each household to hold recyclable items, and requireresidents to separate recyclable and non-recyclable refuse into the different carts.Thus, each household will have two carts. This option also requires replacing theexisting fleet of packing trucks with new ones that empty recyclable and nonrecyclablegarbage into different collection containers on the same truck. Thissystem allows one truck to collect both types of garbage in the same run. Thesenew trucks fill up faster than the old trucks, so more new trucks must operate tocollect and dispose of the same amount of refuse in the same time frame. Carts areretrieved from their permanent location by garbage workers.C) Purchase new carts and run double pick-up: purchase an additional recycling cartfor each household similar to option 2. Rather than purchasing a different fleet ofpacking trucks, this option requires the government to make two sets of refuse runseach week on each household using current trucks. One run collects recyclables,the other non-recyclables. This will require purchasing additional standard packingtrucks to handle additional runs and hiring additional personnel. The city willrequire citizens to bring their refuse to the street (possibly on different days forrecyclable and non-recyclable) to increase the coverage rate (per house) for eachtruck during a shift.Using the figures in Attachment 4F (.pdf or .xlxs) do the following:1) Determine how much each of these options will cost the city over the next 5 years.Assume a 3\% inflation rate and a 4\% discount rate. (Assume that the 1st year isyear 0. Inflation and discount are not applied until year 1.)2) Identify which option is the best from a financial perspective.3) Identify and discuss any other financial and non-financial factors that should orcould be considered in choosing an option in this situation.Section III, Question 5: 20 points. This question requires that you read the case on CityCouncil Hearings in Pine Ridge Arkansas in Attachment 5F.pdf Explain the politics associatedwith these budgetary relationships, and how the problems identified in the case could be resolvedby answering the following questions.A) Identify the players in this political situation and their stake in the current situation: whatare their priorities and likely political positions on the problems created by this situationand appropriate solutions. (Please do not list the council members separately, but discusshow they are likely to coalesce around particular types of solutions to the problem andleverage the problems in similar ways.)B) Based on what you know about the politics of revenues, balancing, and executingbudgets, identify the strategies that are being employed by the players and what strategiesthey are likely to employ to close the deficit and resolve the PISD’s long-run and shortrunproblems (be mindful of the actors’ overall objectives).C) Based on the principles and recommended practices you’ve learned in class and thereadings, what would be the appropriate or most desirable solutions to the problemscreated by this situation, including policies and practices that the city should adopt toresolve the immediate and long-term problems?Attachment 1Attachment 2Attachment 3Attachment 4Attachment 5Attachment 6Attachment 7Attachment 8