CIP Document Agenda Item 14

City of Berlin 2026-2030 Capital Improvement Plan 1 City of Berlin, Wisconsin 2026-2030 Capital Improvement Plan ADOPTED OCTOBER 2025 Prepared by: Robert W. Baird & Co. Public Finance 777 E. Wisconsin Ave. Milwaukee, WI 53202 800.792.2473 City of Berlin 2026-2030 Capital Improvement Plan 2 Table of Contents Long Range Capital Improvement Planning Introduction/Manual .................................................. 3 Berlin CIP Process/Timeline ..................................................................................................................... 5 CIP Components (Tabs) ............................................................................................................................ 6 Capital Improvement Plan Policy Information ..................................................................................... 8 Capital Improvement Plan Summary Information ............................................................................. 12 Capital Improvement Program Department Summaries/Justifications ......................................... 18 Berlin Aquatic Center Potential Project Improvements/Complete Reconstruction ....................95 2026 Capital Improvement Plan Proposed Budget Funding ..........................................................96 Capital Improvement Plan Beyond 2030 .......................................................................................... 104 Important Disclosures ............................................................................................................................ 112 City of Berlin 2026-2030 Capital Improvement Plan 3 Long Range Capital Improvement Planning Introduction/Manual CIP Introduction  This is an essential management tool for Berlin to utilize in planning for Capital Improvements over multiple years. o Allows room for forward thought and discussion. o Better prepares Berlin for change. o Creates opportunities that may otherwise be overlooked.  Berlin is faced with increasing Expenditures and limitations on Revenues. o Creative solutions must be developed to meet these demands. o Long-range planning is key to Berlin’s success. o Funding sources and uses are matched over a multiple year timeframe rather than just one year.  Integrates Capital Improvement Planning (CIP) into annual Budget process. o CIP is initial step in annual budget process. o Operational – Staffing, organizational structure, systems (70-80% of annual budget) o Capital – Infrastructure, maintenance, and equipment. Benefits of a CIP  More efficient administration -Assists in making better decisions in how Berlin is spending resources in coming years.  Administration/Departmental involvement in planning and prioritizing projects/programs with available funding  Provides a disciplined and financially stable approach to spending over multiple years.  Provides a way to plan financing of infrastructure projects and equipment purchases. o Detailed list of projects and funding sources o Project descriptions with justifications/rational  Facilitates the planning and funding of a program.  Public document to obtain community support and keep citizens informed on current needs and future projects.  Focuses attention on objectives and financial capabilities/affordability. o Identifies most economical means of financing capital projects. City of Berlin 2026-2030 Capital Improvement Plan 4 o CIP used by financial advisors to structure and time a capital financing plan borrowing. o CIP avoids drastic changes in debt service payments.  Positive evaluation factor by credit rating agencies and independent auditors Capital Improvement Threshold Policy  Individual tangible capital-type items should be capitalized only if they have a minimum value of $5,000 and have an estimated useful life of more than one year following the date of acquisition.  The capitalization threshold is to be applied to individual items rather than to groups of similar items (e.g., desks and tables) Capital Improvement Planning Process  Establish timeline: Spring-Summer-Fall-Nov/Dec Budget Adoption  City Clerk/Treasurer and City Administrator coordinates and defines Department responsibilities.  Letter/Memo to begin process of compiling or reviewing the CIP: Sample CIP templates for use/update.  Organize all parties involved: Dept. Heads/Staff; Elected Officials (involve early); and public citizens.  Policies: CIP Threshold; Complete Fixed Asset Inventory w/Useful lives/life remaining; Disposal of Equipment  Develop fixed asset replacement schedule & a adequately funded equipment/building replacement fund.  Identify the needs for facilities/programs/projects, the timing, costs (uses) and means of financing (sources) for each. o Use of CIP template forms for consistency and uniformity  Set priorities/rankings/justifications/budget impacts for each identified CIP program and project.  Prepare financial proforma forecast analysis for a range of years showing Berlin’s capacity to afford the CIP.  Execute the plan -Seek review and comment by the public.  Coincide w/Annual budget process: Incorporate first year’s CIP programs/projects into proposed annual budget.  Review the capital improvement program annually. City of Berlin 2026-2030 Capital Improvement Plan 5 Berlin CIP Process/Timeline June: CIP Introduction Organize all parties involved: Dept. Heads/Staff and Elected Officials City Administrator, Clerk-Treasurer, and Baird will coordinate with participants and define responsibilities to begin the process of compiling the CIP. Give Depts. 2024-2028 CIP template forms for consistency and uniformity throughout June/July: CIP Creation Process Identify the needs for facilities/programs/projects, the timing, costs (uses) and means of financing (sources) for each. Set priorities/rankings/justifications/budget impacts for each identified CIP program and project. Use of CIP template forms for consistency and uniformity. Review Established Policies: CIP Threshold; Complete Fixed Asset Inventory w/Useful lives/life remaining; Disposal of Equipment. Review fixed asset replacement schedule & adequately funded equipment/building replacement fund. July: CIP Data due to City Clerk-Treasurer and City Administrator for compilation and then, following review, given back to departments for review and discussion with their respective standing committees: (City Council, Plan Commission. Park Committee) August/September: Distribution to Gov’t Leaders. Review and comment on recommended projects and priorities through standing committee meetings. Board review and approval of CIP with adoption of first year’s projects as a capital budget item in the proposed annual budget. Full CIP used as a tool in the annual budget process and adoption. October: Budget adoption w/CIP. Discussions/Planning with Financial Advisors &Bond Counsel for debt issuance to finance projects. Submit to Rating Agency to assist with Bond Rating Analysis. City of Berlin 2026-2030 Capital Improvement Plan 6 CIP Components (Tabs) Funding Sources Chart This worksheet graphically shows the funding sources detailed on the bottom of the chart for each CIP year. The chart is automatically generated by the data contained on the summary of funds worksheet. Uses by Category Chart This worksheet graphically shows the uses by category detailed on the right side of the chart for each CIP year. The chart is automatically generated by the data contained on the summary of funds worksheet. Summary of Funds This worksheet summarizes the estimated beginning and ending fund balance, individual funding sources, and individual uses by category for each CIP year. The worksheet is automatically generated by combining data contained on each individual category worksheet. Category Worksheets A worksheet is created for each individual CIP category. All cells with a black text need user input and all cells with a blue text have a numeric formula which users cannot change. The user will need to type in a name at the top of each category tab on line 4 for that category to show properly on the summary and chart tabs. The first year estimated or actual beginning fund balance for the category needs to be entered. The combined totals of sources and uses will be calculated from individual project/program worksheets for each CIP year. The user needs to insert the required number of program/project lines for each individual CIP category. Formulas from the program or project description & justification tabs are then created for each individual program/project name and the year-by-year totals. When the worksheet is printed on a black and white printer it will display all cells in the same color. Program or Project Description & Justification A worksheet is completed for each CIP project or program. The program or project is identified by category, name, and number. Department, contact, type, useful life, priority, and purpose are also available for identification. A narrative description and justification are required for the program or project. For each CIP year, the program or project total expenditure (uses) and funding sources (detailed by type) are entered in the black text cells. Blue text cells have a numeric formula which users cannot change. A narrative budget impact and other relevant information are required at the bottom of the worksheet. City of Berlin 2026-2030 Capital Improvement Plan 7 Drop-down menus are available for selection of priority, purpose, and funding sources. Upon completion of the worksheet, the program or project category name, identification number, uses and funding sources will be transferred by manually creating a formula to the individual category tab created by the user. Proposed Budget Funding This worksheet gives a detailed listing of the individual program or project for the proposed budget year by category, identification number, priority ranking, and purpose. The data entered in these columns will be from the program and project worksheet. The individual line item is then identified by the requested, defunded, and final budget dollar amount. The budgeted dollar amounts will tie back to the requested, defunded, and budget columns found on the individual category worksheet uses by category section. Beyond 5-Year Period This worksheet details individual program and project by category that are beyond the 5-Year CIP timeline. The year planned, ranking criteria, purpose, and estimated cost are identified. A drop-down menu is available for the ranking criteria and purpose. City of Berlin 2026-2030 Capital Improvement Plan 8 Capital Improvement Plan Policy Information Capital Asset Policy Purpose: The purpose of this policy is to establish a consistent methodology for recording in the financial records of the City of Berlin (“City”), the capitalization and depreciation of capital assets, consistent with current reporting requirements as determined by the State of Wisconsin and the Governmental Accounting Standards Board (“GASB”). General: The City of Berlin holds certain capital assets which include land, buildings, vehicles, machinery and equipment, parks and roads infrastructure, furniture, and fixtures, and all other tangible or intangible assets, which are used in operations and that have initial useful lives extending beyond a one-year period. These assets must be accounted for at historical cost or estimated historical cost and be fairly represented in the City of Berlin’s Annual Financial Report. Valuation: All costs shall be documented, including methods and sources used to establish such cost basis. 1. Purchased assets: the recording of purchased assets shall be made based on actual costs, including all ancillary costs, based on the vendor invoice or other supporting documentation. 2. Self-constructed assets: all direct costs (including labor) associated with the construction project shall be included in establishing a self- constructed asset valuation. If the City is unable to identify all direct costs, an estimate of the direct cost is acceptable but must be supported by a reasonable methodology. 3. Donated assets: assets acquired by gift, donation, or payment of a nominal sum not reflective of the asset’s fair market value shall be assigned a cost equal to the fair market value at the time of acquisition. 4. Leased property: capital lease property shall be recorded as an asset and depreciated as though it had been purchased. 5. Dedicated assets: requires installation by developers of public improvements, including but not limited to sanitary sewer mains, manholes, laterals, water mains, hydrants, valves, storm and sanitary sewers, streets, curb and gutter, streetlights, street signs, sidewalks will be dedicated to the City upon completion. Recording of infrastructure assets will be made based on actual costs, including ancillary costs, City of Berlin 2026-2030 Capital Improvement Plan 9 based on vendor invoice or other supporting documentation provided by the developer. 6. Shared purchases: assets shared with other municipalities or entities shall be made based on the City’s share of actual costs, including ancillary costs, based on vendor invoice or other supporting documentation. Ancillary costs: Ancillary costs are to be included in the capitalized cost of a fixed asset. However, minor costs, not measurable at the time a fixed asset is recorded in the City’s fixed asset inventory system, may be expensed. Ancillary costs include:  Buildings and Improvements: professional fees of architects, attorneys, appraisers, financial advisors, etc.; damage claims; costs of fixtures permanently attached to a building or structure; insurance premiums and related costs incurred during construction; and other expenditures necessary to place a building or structure into its intended state of operation.  Equipment: transportation charges, installation costs, and any other normal and necessary expenditures required to place the asset into its intended state of operation.  Land: legal and title fees, surveying fees, appraisal and negotiation fees, damage payments, site preparation costs, and costs related to demolition of unwanted structures. Classification: Capital assets include items with useful lives greater than one year, land, land improvements, buildings, building improvements, construction work in progress, machinery and equipment, vehicles, infrastructure, easements, and works of art and historic treasures. A capital asset is to be reported and, with certain exceptions, depreciated in government-wide statements. Assets that are not capitalized are expended in the year of acquisition. Infrastructure assets are long-lived assets that normally can be preserved for a significantly greater number of years than most capital assets and that are normally stationary in nature. Examples include roads, bridges, drainage systems, and water systems. Infrastructure assets do not include buildings, drives, parking lots, or any other examples given above that are incidental to property or access to the property. Long-term assets can be classified into the following:  Furniture and equipment: office furniture; office, data processing, and special department equipment City of Berlin 2026-2030 Capital Improvement Plan 10  Vehicles and equipment: vehicles, operating and mechanical equipment.  Land: land, land improvements.  Buildings: buildings, building improvements.  Infrastructure: streets, bridges, water and sewer systems, drainage systems, sidewalks, curb, and gutter, etc. Capitalization: Capital asset value thresholds for capitalization are to be applied to individual capital assets rather than to groups of similar capital assets. Capital assets must have an initial value of $10,000 or more. This will be known as the “capitalization threshold” for reporting purposes in the Annual Financial Report. Repair and maintenance costs are expenditures that keep the property in ordinary efficient operating condition. The cost of the repair does not add to the value or prolong the life of the asset. All repair and maintenance costs to capital assets are to be treated as an annual operating expense and charged to the appropriate department and fund. Improvements are expenditures for additions, alterations, and renovations that appreciably prolong the life of the asset, materially increase its value, or adapt it to a different use. Improvement costs of $10,000 or more to an individual capital asset are to be capitalized. Depreciation: All long-term assets (except for land, certain land improvements, and construction in progress) identified in the capital assets policy will be depreciated/amortized. Regardless of the month the asset is placed in service, a full year of depreciation/amortization will be recorded in the first year. Once the asset has been fully depreciated, the asset will be kept on the books until disposed of. When the asset is disposed of prior to the end of its useful life, the remaining “book” value will be written off as depreciation unless it will materially affect the City’s financial statements. Useful Life: To determine the useful life of an asset for depreciation purposes, the City shall consider an asset’s present condition and how long it is expected to meet its service demands in addition to applying applicable industry standards for useful life. City of Berlin 2026-2030 Capital Improvement Plan 11 Inventory: An inventory of all long-term assets should be reviewed and updated annually. Capital Assets Policy Developed: August 2025 Adopted: September 2025 City of Berlin 2026-2030 Capital Improvement Plan 12 Capital Improvement Plan Summary Information Components Summary of Funds This worksheet summarizes the estimated beginning and ending fund balance, individual funding sources, and individual uses by category for each CIP year. The worksheet is automatically generated by combining data contained on each individual category worksheet. Funding Sources Charts These graphically show the funding sources detailed on the bottom of the charts for each CIP year. The charts are automatically generated by the data contained on the summary of funds worksheet. Uses by Category Charts These graphically show the uses by category detailed on the bottom of the charts for each CIP year. The charts are automatically generated by the data contained on the summary of funds worksheet. City of Berlin 2026-2030 Capital Improvement Plan 13 City of Berlin 2026-2030 Capital Improvement Plan 14 $2,615,082 $1,258,500 $1,505,000 $607,500 $11,369,925 $3,213,657 $229,416 $318,000 $298,000 $298,000 $298,000 $308,000 0 2000000 4000000 6000000 8000000 10000000 12000000 14000000 1 2 3 4 5 Funding by Sources TOTAL SOURCES CAPITAL PROJECTS TAX LEVY GENERAL FUND TAX LEVY BOND PROCEEDS W/S BONDS PROCEEDS GRANTS GENERAL FUND RESERVE OTHER SOURCE City of Berlin 2026-2030 Capital Improvement Plan 15 BOND PROCEEDS, $17,356,007 W/S BONDS PROCEEDS, $3,443,073 OTHER SOURCE, $1,520,000 Funding by Sources BOND PROCEEDS W/S BONDS PROCEEDS GRANTS GENERAL FUND RESERVE OTHER SOURCE City of Berlin 2026-2030 Capital Improvement Plan 16 $- $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 City Administration Fire Department Cemetery EMS Library Public Works Parks and Facilities Police Department Utilities 2026-2030 Department Yearly Costs 2030 2029 2028 2027 2026 City of Berlin 2026-2030 Capital Improvement Plan 17 City Administration, $40,000 Fire Department, $851,000 Cemetery, $95,000 Library, $185,000 Public Works, $13,715,007 Parks and Facilities, $1,730,000 Police Department, $350,000 Utilities, $4,953,073 Uses by Category City Administration Fire Department Cemetery EMS Library Public Works Parks and Facilities Police Department Utilities City of Berlin 2026-2030 Capital Improvement Plan 18 Capital Improvement Program Department Summaries/Justifications Department Summary Categories A worksheet is created for each individual CIP Department with sources and uses categories. The first year estimated or actual beginning fund balance for the category needs to be entered. The combined totals of sources and uses will be calculated from individual project/program worksheets for each CIP year. Program or Project Description & Justification A worksheet is completed for each CIP project or program. The program or project is identified by category, name, and number. Department, contact, type, useful life, priority, and purpose are identified. A narrative description and justification are required for the program or project. A narrative budget impact and other relevant information are required at the bottom of the worksheet. City of Berlin 2026-2030 Capital Improvement Plan 19 City of Berlin 2026-2030 Capital Improvement Plan 20 City of Berlin 2026-2030 Capital Improvement Plan 21 City of Berlin 2026-2030 Capital Improvement Plan 22 City of Berlin 2026-2030 Capital Improvement Plan 23 City of Berlin 2026-2030 Capital Improvement Plan 24 City of Berlin 2026-2030 Capital Improvement Plan 25 City of Berlin 2026-2030 Capital Improvement Plan 26 City of Berlin 2026-2030 Capital Improvement Plan 27 City of Berlin 2026-2030 Capital Improvement Plan 28 City of Berlin 2026-2030 Capital Improvement Plan 29 City of Berlin 2026-2030 Capital Improvement Plan 30 City of Berlin 2026-2030 Capital Improvement Plan 31 City of Berlin 2026-2030 Capital Improvement Plan 32 City of Berlin 2026-2030 Capital Improvement Plan 33 City of Berlin 2026-2030 Capital Improvement Plan 34 City of Berlin 2026-2030 Capital Improvement Plan 35 City of Berlin 2026-2030 Capital Improvement Plan 36 City of Berlin 2026-2030 Capital Improvement Plan 37 City of Berlin 2026-2030 Capital Improvement Plan 38 City of Berlin 2026-2030 Capital Improvement Plan 39 City of Berlin 2026-2030 Capital Improvement Plan 40 City of Berlin 2026-2030 Capital Improvement Plan 41 City of Berlin 2026-2030 Capital Improvement Plan 42 City of Berlin 2026-2030 Capital Improvement Plan 43 City of Berlin 2026-2030 Capital Improvement Plan 44 City of Berlin 2026-2030 Capital Improvement Plan 45 City of Berlin 2026-2030 Capital Improvement Plan 46 City of Berlin 2026-2030 Capital Improvement Plan 47 City of Berlin 2026-2030 Capital Improvement Plan 48 City of Berlin 2026-2030 Capital Improvement Plan 49 City of Berlin 2026-2030 Capital Improvement Plan 50 City of Berlin 2026-2030 Capital Improvement Plan 51 City of Berlin 2026-2030 Capital Improvement Plan 52 City of Berlin 2026-2030 Capital Improvement Plan 53 City of Berlin 2026-2030 Capital Improvement Plan 54 City of Berlin 2026-2030 Capital Improvement Plan 55 City of Berlin 2026-2030 Capital Improvement Plan 56 City of Berlin 2026-2030 Capital Improvement Plan 57 City of Berlin 2026-2030 Capital Improvement Plan 58 City of Berlin 2026-2030 Capital Improvement Plan 59 City of Berlin 2026-2030 Capital Improvement Plan 60 City of Berlin 2026-2030 Capital Improvement Plan 61 City of Berlin 2026-2030 Capital Improvement Plan 62 City of Berlin 2026-2030 Capital Improvement Plan 63 City of Berlin 2026-2030 Capital Improvement Plan 64 City of Berlin 2026-2030 Capital Improvement Plan 65 City of Berlin 2026-2030 Capital Improvement Plan 66 City of Berlin 2026-2030 Capital Improvement Plan 67 City of Berlin 2026-2030 Capital Improvement Plan 68 City of Berlin 2026-2030 Capital Improvement Plan 69 City of Berlin 2026-2030 Capital Improvement Plan 70 City of Berlin 2026-2030 Capital Improvement Plan 71 City of Berlin 2026-2030 Capital Improvement Plan 72 City of Berlin 2026-2030 Capital Improvement Plan 73 City of Berlin 2026-2030 Capital Improvement Plan 74 City of Berlin 2026-2030 Capital Improvement Plan 75 City of Berlin 2026-2030 Capital Improvement Plan 76 City of Berlin 2026-2030 Capital Improvement Plan 77 City of Berlin 2026-2030 Capital Improvement Plan 78 City of Berlin 2026-2030 Capital Improvement Plan 79 City of Berlin 2026-2030 Capital Improvement Plan 80 City of Berlin 2026-2030 Capital Improvement Plan 81 City of Berlin 2026-2030 Capital Improvement Plan 82 City of Berlin 2026-2030 Capital Improvement Plan 83 City of Berlin 2026-2030 Capital Improvement Plan 84 City of Berlin 2026-2030 Capital Improvement Plan 85 City of Berlin 2026-2030 Capital Improvement Plan 86 City of Berlin 2026-2030 Capital Improvement Plan 87 City of Berlin 2026-2030 Capital Improvement Plan 88 City of Berlin 2026-2030 Capital Improvement Plan 89 City of Berlin 2026-2030 Capital Improvement Plan 90 City of Berlin 2026-2030 Capital Improvement Plan 91 City of Berlin 2026-2030 Capital Improvement Plan 92 City of Berlin 2026-2030 Capital Improvement Plan 93 City of Berlin 2026-2030 Capital Improvement Plan 94 City of Berlin 2026-2030 Capital Improvement Plan 95 Berlin Aquatic Center Potential Project Improvements/Complete Reconstruction On July 28, 2025, City Administrator Jessi Balcom provided the common council with a staff report detailing information regarding the options for the future of the Berlin Aquatic Center. In 2024 the city was provided with an estimate of structural/maintenance deficiencies needed to be undertaken by Ramaker for a cost estimate of around $2,000,000. The common council in subsequent meetings reviewed scenarios ranging from the city borrowing completely to undertake the repairs, fully funded via donations/community funding, combination of borrowing and donations, as well as consideration of demolishing the existing pool and reconstruction of a new upgraded facility. The above project sheet is intended to be a resource for the council and the community to continue to discuss the possible funding of structural/maintenance deficiencies and or complete reconstruction of the Berlin Aquatic Cener to determine the potential inclusions with the five-year capital improvement plan or long-term planning for the future. City of Berlin 2026-2030 Capital Improvement Plan 96 2026 Capital Improvement Plan Proposed Budget Funding A detailed department by department listing of the individual program or project for the proposed budget year by category, identification number, priority ranking, and purpose. The data entered in these worksheets will be from the program and project worksheet. The individual line item is then identified by the requested, defunded, and final budget dollar amount. The budgeted dollar amounts will tie back to the amounts found on the individual category worksheet uses by category section. City of Berlin 2026-2030 Capital Improvement Plan 97 City of Berlin 2026-2030 Capital Improvement Plan 98 City of Berlin 2026-2030 Capital Improvement Plan 99 City of Berlin 2026-2030 Capital Improvement Plan 100 City of Berlin 2026-2030 Capital Improvement Plan 101 City of Berlin 2026-2030 Capital Improvement Plan 102 City of Berlin 2026-2030 Capital Improvement Plan 103 City of Berlin 2026-2030 Capital Improvement Plan 104 Capital Improvement Plan Beyond 2030 This section details department by department individual program and projects by category that are beyond the 5-Year CIP timeline. The year planned, ranking criteria, purpose, and estimated cost are identified. City of Berlin 2026-2030 Capital Improvement Plan 105 City of Berlin 2026-2030 Capital Improvement Plan 106 City of Berlin 2026-2030 Capital Improvement Plan 107 City of Berlin 2026-2030 Capital Improvement Plan 108 City of Berlin 2026-2030 Capital Improvement Plan 109 City of Berlin 2026-2030 Capital Improvement Plan 110 City of Berlin 2026-2030 Capital Improvement Plan 111 City of Berlin 2026-2030 Capital Improvement Plan 112 Important Disclosures Robert W. Baird & Co. Incorporated is providing this information to you for discussion purposes. The materials do not contemplate or relate to a future issuance of municipal securities. Baird is not recommending that you take any action, and this information is not intended to be regarded as “advice”’ within the meaning of Section 15B of the Securities Exchange Act of 1934 or the rules thereunder.