The Street Financial Data
Executive Summary
* It costs about $17,000 a mile annually to maintain residential streets.
* This expands to $500,000 if all 29.5 miles of private streets became public.
* Since garbage/recycle trucks account for up to 99% of the wear and tear on small residential streets, a garbage impact fee increase could finance the cost.
* The increase in garbage bills for all residents would be $70/year; 20 cents a day.
* This cost, to all residents is de minimis, relative to the nearly $12,000 in sales and road bond taxes that private property owners are obligated to pay for the repair of public residential streets plus the $150 a year they pay to maintain these streets which they minimally use and impact.
Cost to Maintain Residential Streets
P-TAP-23 includes five scenarios (on page 9) for funding road maintenance over the next five years (from 2022 to 2027), ranging from spending $3.8 million a year for five years and increasing the city's average PCI from 84 to 87; to spending between $1.6 and $1.9 million a year to maintain the average PCI at 84; to spending nothing and seeing the average PCI drop to 78.
The last (December 2019) Road and Drainage Repairs Plan has photos of streets (pages 43 and 44) ranging from PCI-8 to PCI-80. PCI-70 to PCI-80 are almost perfect streets. Even PCI-47 looks very good. So a PCI of 78 is not bad but, obviously, spending nothing cannot be sustained.
In P-TAP-23, Scenario 4 ($1.6 million a year) is called the "Current Budget" scenario. $8 million spent over 5 years; $1.6 million a year; the average PCI decreases from 84 to 83. On page 79 of the report is a breakdown by class of street. For residential plus "urban local" streets, the total cost is $5.6 million over 5 years.
From page 5 of P-TAP-23, there are 66 miles of residential plus "urban local" streets (residential streets that serve schools, like Martha which serves Glorietta and El Camino Moraga which serves Del Rey).
Dividing the $5.6 million by 66 miles of streets and then by 5 years results in a projected average annual cost to maintain a residential street of $17,000 per mile. This $17,000 a mile maintains Orinda's roads at a PCI of 83 over five years. Is this sustainable over the long term (20 years)? A city-wide average of 83 is one of the highest averages in the Bay Area.
If all 29.5 miles of private streets were to choose to allow public access in exchange for publicly funded maintenance, the cost to maintain these streets would be about $500,000 a year, at $17,000 a mile.
Offsetting Revenue
There are two revenue sources which are dependent on the number of miles of public streets in a city. CCCTA return-to-source (Fund 330) and the (solid waste provider) Road Maintenance Fee (Fund 335). Based on a review of the City budget presented to the SSTOC in June 2023, Fund 330 is expecting about $500,000 a year in revenue this year, then a 3 year hiatus of no funds, with funding resuming in 2027. Fund 335 $1.2 million per year through 2025, which then reduces to $750,000.
Half of the return-to-source (Fund 330) revenue is based on public road mileage. $250,000 per year allocated over 93 miles represents $2,700 per mile. It is unclear why this revenue pauses for three years, but 30 miles of "new" public streets could generate $80,000 a year.
The $1.2 million in Road Maintenance Fee revenue represents $13,000 a mile annually, and when it drops to $750,000, that is $8,000. This is supposed to compensate Orinda for the impact the garbage and recycle trucks have on Orinda's roads. Does it?
In the last (December 2019) Road and Drainage Repairs Plan was a graph showing the impact of various vehicles on the roads (page 71). This showed garbage trucks as having 9,343 times the impact of a sport utility vehicle. So the three garbage trucks that come up each street each week have the same impact as 28,000 cars. How many cars does a residential street generate? Dennis Fay claimed the average residence generates about 5 trips per day. There is an average of 8 homes on each private street; generating 40 trips per day; 280 trips per week. This is 1% of the number of equivalent trips the garbage trucks generate. Therefore, shouldn't the Road Maintenance Fee (if it is supposed to compensate for the impact of garbage/recycle trucks) for small residential streets be 99% of the cost to maintain? 99% of $17,000 a year equal to $16,830, twice what the fee is projected to reduce to in a couple of years.
And what would this cost the garbage company, which would then pass the cost onto the customers? If all 29.5 miles of streets chose to provide public access, the total fee would be $500,000. But it would be spread across over 7,000 users, resulting in about $70 a year per household. Which is $11.75 per bi-monthly bill; 20 cents a day. Less if not all 29.5 miles of private streets desired to "go public".
What does it cost private street residents to maintain public residential streets?
How does this compare to what the residents of private streets are paying to service the 64 miles of public residential streets at $17,000 per mile? $1.09 million per year. This is twice the cost to maintain the currently unfunded private streets. Assuming this cost is also spread across all 7,080 Orinda families, this means all Orinda households, including those on private streets, are already paying twice as much, about $150 a year each, on public residential streets as they would end up paying to maintain the existing private streets.
But that is just for on-going maintenance. We have also paid, and continue to pay for deferred maintenance (repairs) on the 64 miles of public residential streets.
Starting in 2012 Orinda residents passed a series of taxes to repair the 64 miles of public residential streets. First there was the Measure L sales tax in 2012; then the $20 million Measure J road bond in 2014; and finally the $25 million Measure L road bond in 2016. The Measure L sales tax generated about $9.5 million in revenue between 2013 and 2020. The two bond measures will ultimately cost the taxpayers $66 million to repay. $75 million total; virtually all of which went to repair the 64 miles of public residential streets.
Private street residents, representing about 22 percent of Orinda's residents, paid about 22 percent of the sales tax, $2.1 million in total. The road bonds are repaid as ad valorem property taxes based on property assessed values. While the average residential property on public streets was assessed at $1.14 million (FY 2022/23), the average residential property on private streets was assessed 30% higher at $1.47 million. The properties on private streets account for 25% of Orinda's property tax base. Therefore, they will be paying 25% of the bond cost, $16.7 million over 18 years. Total tax cost, Measure L sales tax plus road bonds, to the private street residents will be $18.8 million, $12,000 per property, for the deferred maintenance of the public residential streets.
Taxes aren't always fair? Is this a fact or a perception? In the case of the $75 million in taxes raised to repair Orinda's 64 miles of publicly maintained residential streets, could a different tax been imposed that did not require the minority, receiving minimal benefits, to support the majority? The answer is yes. A Benefit Assessment District could have been formed. Then, instead of taxing all of Orinda for the benefit of bare majority (4,260 out of 7,080), only those receiving the $75 million in benefits, $17,700 per household, would have paid it; not taxing those living on private streets, arterials and collectors. Instead, those benefiting (4,260 out of 7,080; 60% of Orinda's residents) who paid 60% of the $9.5 million Measure L sales tax ($5.7 million) and are paying only 54% (their share of Orinda's property tax base) of the $66 million cost of road bonds ($36 million), will be paying a total of $9,800, a little more than half of the $17,700 benefit they received.
The City did not plan this disproportionate allocation of costs vs. benefits and those who voted these taxes in were not aware of the impact. But neither did the City consider how to prevent this inequality and create as fair a tax system as possible.