The 2023 Budget includes several capital expenditure projects supporting departments and the organization as a whole in various funds and public service functions. This section provides details on the different types of expenses and the funding sources as they pertain to the 2023 Budget. The capital expenditure budgets consist of the following:

Capital Expenditures are defined as the acquisition or upgrade of physical assets such as property, fixtures or machinery and they are budgeted in several different funds. The specific items and projects are formally requested by the respective Elected Officials and Department Heads during the budget process. There is opportunity for public comment during the advertised budget hearing. As with any county expenditure, the Board of County Commissioners (BOCC) makes the final decision on the detail of the item or project and the related funding level.

Many of the capital projects for Transportation and Open Space Acquisition are the result of local sales taxes being passed by the voters. There are no direct operating savings from these projects, as collection of the taxes carries the responsibility to implement the projects. There is, however, a non-financial impact of safer roads, which are friendlier to alternative modes of transportation, and additional open space that makes Boulder County an even more desirable location in which to live. Many of the impacts from the Capital Expenditure program improve the quality of the environment.

Any associated impacts to operating and personnel budgets are considered during the process. For example, a project may require new staff with associated capital equipment and additional operating dollars. Although the dollars may be budgeted in separate budgets, the total cost is presented in a package to the board for its decision.

This budget includes items such as vehicles, heavy equipment, software and computer equipment. The Board of County Commissioners approves these capital items and the associated costs during the budget process. Major changes in specifications cannot be made unless a department chooses to pay the added cost.

The Office of Financial Management’s Budget Team works with the county’s executive leadership to hold a collaborative budget hearing for all capital requests including computer capital, vehicle replacements (both a part of the Capital Outlay program), and the Building Services Division requests that address major building and infrastructure needs. All the stakeholders are invited to participate and learn about other capital requests competing for funding. This also allows the BOCC to hear a comprehensive presentation of all capital which aids in their decision process.

Impacts on Operating Budgets in 2023 and Future Years

The BOCC recognizes the necessity to keep up with the rapidly changing pace of technology and provide employees with the proper tools that empower them to be more productive and to enhance services to the public. The intent is to provide more technical solutions instead of increasing staff to keep up with the growing workload.

The capital outlay budget impacts future operating budgets both in future cost avoidance (avoiding expenditures in a future year for capital items, such as motor vehicles and computers, resulting from operating these items at or beyond their useful life), and by service demand for additional new fixed assets to address program expansions and new initiatives.

Funding for technology is expected to increase productivity of the current workforce. It is anticipated that this will keep the demand for increased FTEs low as the workload increases. Managing to control the growth in personnel costs makes a big difference in total expenses since approximately 71% of all General Fund costs are related to personnel.

2023 Information Technology Projects

The Technology Resource Advisory Committee (TRAC) was formed to implement the county’s strategic technology vision including the use of information technology to increase the capacity and productivity of the county. Its task is to set a course for the county on computer technology, expected levels of service provision, and where technology will lead into the future.

A TRAC subcommittee, the Business Analysis Team (BAT), was formed to help the project originators to develop effective Project Requests and Business Cases. The information developed from the Business Case reviews is used by TRAC to prioritize and recommend projects for funding. Staff in Purchasing and Information Technology act as the technical advisor to the county users involved and assist with pricing of all equipment requests.

The committee prioritizes the requests based on need and compliance with the goals and criteria set by the committee. All items are discussed during the budget hearing held in September.

2023 Fleet Vehicle Replacement

Fleet Services staff prepares a prioritized list annually for vehicle replacement recommendations. Depending on the type and age of the vehicle to be replaced, the criteria for replacement are: 1) 85,000-250,000 miles; 2) 10- 16 years old; or 3) excessive maintenance costs. Through maintenance records on the various vehicles, staff can ascertain if any vehicles should be prioritized above others of similar age/mileage. The Fleet Services manager presents this list at the September capital budget hearing.

Through the budget staff’s discussions with departments and offices, it is determined if some vehicles can be recycled to a less intensive use rather than purchasing a new vehicle. The Office of Financial Management’s Budget Team works with the BOCC on an annual basis to define the annual funding capacity to underwrite the replacement program. Most vehicles are purchased via a State contract that is usually the lowest available price.

2023 New Vehicles and Other Equipment

Other capital expenditure items comprise all new vehicle requests as well as miscellaneous equipment such as office machines. Other equipment requests are handled similarly to vehicles except there is no minimum criterion for replacement.

Budgets for transportation infrastructure projects are presented at a high level during the budget hearings. Boulder County Transportation oversees development of road, trail, and transit plans, programs, and projects based on planning efforts both internal and with project partners and determines general amounts needed for each function. Transportation projects are funded with a combination of property tax, Specific Ownership Tax, Highway Users’ Tax and other revenues in the Road and Bridge Fund. In addition, a voter-approved 0.10% sales and use tax is allocated to both the Road and Bridge Fund (0.085%) and the Dedicated Resources Fund (0.015%).

Impacts on Operating Budgets in 2023 and Future Years

A capital expenditure in transportation is any expenditure that serves to increase the capacity and efficiency of the transportation infrastructure, whether by reducing travel times, improving access, creating capacity for more passenger and goods traffic, reducing costs, or reducing adverse safety and environmental impacts. For the most part the benefit/cost of improvements to the transportation system relate more to savings in time and safety related costs external to the project-cost model.

Unlike capital expenditures for a new building that will require additional maintenance and facilities expenditures in future years, as well as consuming additional utilities that must be paid for, transportation capital projects serve to keep future maintenance costs contained, as they either correct deficiencies in existing infrastructure or provide new systems that require little maintenance in the near future.

The Road and Bridge Fund budget includes funding for on-going maintenance and improvement of transportation infrastructure such as roadway striping, minor structure repair, concrete sidewalk repairs, etc.

Project Identification Process

The Transportation Master Plan (TMP) guides the development of and investment in Boulder County’s multimodal transportation system. Multimodal Transportation Standards guide the design of transportation facilities and requirements for development within unincorporated Boulder County.

The Director of Public Works and staff are directed by the Boulder County Commissioners to refine the scope of projects within the allocated budget amounts on an annual basis, and there is opportunity for public comment on the projects. The commissioners give direction to Public Works on which projects to proceed with and/or which projects need further refining. Additional information about transportation planning can be found on the county’s Plans & Projects website.

Boulder County Building Services currently maintains 58 county facilities and structures, encompassing just over 1.3 million square feet of occupied and maintained space. The county analyzes building needs and plans replacement, renovations and improvement projects on an ongoing basis.

In 2018, the Boulder County Building Services (BCBS) Division created a Facilities Master Plan to be used as a guiding vision for short-term and future planning for Boulder County’s buildings and facilities. The plan includes an assessment of current facilities, including a site’s function and purpose within the county, the public service provided, and the location.

The BCBS division also looked to the future needs of Boulder County facilities over the course of the next ten years.

Here are a few of the more important recommendations:

• Facilities should focus on client services and adopt the public services hub model that was first created at the St. Vrain Community Hub in Longmont.
• Facilities should have a public zone where staff meets clients in a welcoming environment.
• Boulder County should consolidate services as much as possible and create flexible floor plans so departments can shrink and grow with minimal adjustments.
• Boulder County should aim to share resources like conference rooms, drop in spaces, and break rooms to be cost-effective with resources.

In 2023, the BCBS Division will wrap up interior construction on the Southeast HUB in Lafayette. This County Services building supports more than 65 reservable hoteling spaces for county employees, meeting spaces, break room functions, one large room to support county training and events, and lounge areas with incredible views of the mountains. This space will be utilized by staff from Public Health, Community Services, the Clerk & Recorder, Housing & Human Services, the Assessor’s Office, and the Treasurer’s Office. Once complete, the Southeast HUB will be LEED Certified – a green building rating system providing framework for healthy, efficient, and cost-saving green buildings. In addition, BCBS plans to begin construction on the voter-approved Alternative Sentencing Facility in Boulder. This one-of-a-kind facility will be a community-based, minimum security, residential facility that will house all alternative sentencing programs utilized in Boulder County. Alternative sentences are programs that allow offenders to serve their sentences in a less restrictive structure than a traditional jail or prison and can be residential or non-residential in nature.

Impact on Future Operating Budgets

Many current budget decisions affect future budgets. The commissioners consider these multi-year capital budget impacts before the project is approved. We use a multi-year budget projection spreadsheet as a tool to plan expenditures necessary to complete and operate new facilities. In addition to the capital cost, such projects have long-range maintenance costs, which are also considered before approval. By planning for future space needs during remodels and upgrades, the county can project budgets more realistically. The commissioners do not approve projects that result in significant cost increases if an increase in the tax rate would be required. Because of TABOR restrictions a tax increase can only occur if a ballot issue is approved by the voters.

Before approving a capital expenditure, associated costs and impacts to other budgets are identified by staff and evaluated by the commissioners in the decision-making process. For example, a new capital building project has associated staffing and operational costs when it is completed. On the long-term capital outlook these associated costs are shown with the construction costs. We utilize a methodology of operating costs per square foot based on the type of building usage. This way the board can do long-term budget planning aware of the full cost component once the new building becomes operational. The current formula uses an incremental operational per square foot methodology.

On the budget year that a new facility will open the operating costs are defined and the estimate is no longer used. Ongoing costs are tracked into the base budget for future years, while one-time costs are only included in the current year budget.

Project Identification & Process

During the budget process, county agencies can make requests for capital projects. The Building Services design representatives meet with the requesting agency to evaluate the projects and estimate costs. The evaluation includes issues such as health, safety, structural and mechanical analysis, asbestos and other hazardous material identification, electrical service efficiency, roofing/moisture protection and architectural renovation and replacement of finishes. In addition to projects requested by others, the designers may generate requests themselves. These may be projects desired by the commissioners or projects that are required for health and safety reasons.

As various issues such as fire safety upgrades or structural upgrades are being explored, further cost analysis is done to determine the cost efficiency of a simultaneous remodel or renovation to accommodate long-term trends. When planning space needs or renovations, facility condition and current building codes help drive the best solution. This is a cost-effective process that addresses multiple needs at one time.

The Deputy Director of Public Works prepares a prioritized list of all projects with the associated costs, including labor and materials, with input from the architects and maintenance personnel. The list of projects is described and explained by the county Administrator and the Deputy Director of Public Works to the Board of County Commissioners during a public meeting. All interested Elected Officials or Department Directors have an opportunity to further explain the need for their project in this meeting or to address the need within their own budget hearing.

Boulder County maintains records of its capital assets and conducts an annual inventory in accordance with state statutes. State statutes also allow the county to choose the amount at which it would capitalize assets of a permanent nature. Capital assets are defined by the county as assets with an initial, individual cost of $5,000 or more for equipment; $50,000 or more for buildings, improvements, and infrastructure; $100,000 or more for software either purchased or developed internally; and with an estimated useful life of more than one year.

The county manually conducts its annual capital asset inventory. An Elected Official or Department Head from each agency receives a list of capital assets and verifies that each capital asset is still in the county’s possession. Staff in the Office of Financial Management are responsible for coordinating the reconciliation process.

Capital Outlay items are purchased from a central budget in the General Fund; however, each agency is responsible for the items assigned to it. Capital assets are recorded in the capital asset system by agency. Additions to capital assets are recorded as expenditures in the General, Special Revenue and Capital Projects Funds.

The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Improvements are capitalized and depreciated over the remaining useful life of the related capital asset, as applicable. Capital assets are depreciated using the straight-line method. Depreciation expense is reflected as an operating expense in the government-wide statement of activities.

The county’s total capital assets for its governmental and business-type activities for 2021 amounted to $1,079,442,751. This investment in capital assets includes land, buildings and systems, improvements, infrastructure, machinery and equipment, park facilities, roads, highways, and bridges. The county’s 2021 capital asset balances increased by $26,654,558.