The capital budget process in Stafford County has been informal and political. The newly elected county executive feels this process needs to be reformed to deal with the serious problems that the county faces. She has asked you to design a new process for capital planning and budgeting. To start your thinking about the design, please formulate what you think the three or four most important objectives of a capital budgeting process should be. Please read the plan to answer the question listed above. 

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STAFFORD COUNTY CAPITAL PLAN You have just become the director of the newly created Stafford County Capital Planning Office. In the past capital planning in Stafford County has been done informally as part of the operating budget process. Agencies were asked to include capital budget requests in with their regular budget request. Since capital projects span multiple years, agencies were supposed to submit a description of the "outyear" budgetary impact of the capital project. In addition, county legislators have controlled half of the capital budget to use for their constituent projects. Capital expenditures have averaged $20 million a year over the last several years. Stafford County is facing some significant budgetary challenges in the next decade. The local economy, has faced stagnant growth and was hit hard by the last recession. The property tax base, and the sales tax base have declined at the same time that the County faces significant capital needs: 1. Stafford County jail: The jail has experienced significant overcrowding for years. Last year, a federal judge ordered Stafford County to develop a "permanent solution" to the local jail overcrowding problem in the next year or face fines of up to $10,000 per day per prisoner above rated capacity. A similar jail constructed in another city cost $200 million. 2. A local environmental group sued the county under the federal Clean Water Act to clean-up the effluent that is being dumped into Braden Lake from the county sewage treatment plant. A federal court has ordered the County to present a plan for dealing with the effluent from the sewage treatment plant to the U.S. EPA. One estimate received by the county was $500 million. 3. Due to recent changes in federal environmental laws regarding solid waste disposal, the Illiana State Department of Environmental Conservation (DEC) is requiring counties in Illiana to prepare a "Solid Waste Management Plan". The state plans on shutting down the two landfills in Stafford County in the next five years, and the County needs to prepare plans for alternative solid waste disposal facilities. To replace one of these landfills with one meeting all environmental regulations would be $50 million. 4. The County supplies water to its residents through an enterprise fund, which covers most of its costs through user fees. The County has not done an inventory of its water pipes in 50 years. Fifty percent of the water distributed from the treatment plant leaks out before it can be used. To replace half of the pipes in the County it would take 5 years and cost $150 million. 5. The County Road Department is responsible for maintaining 20 bridges in the county. The state pays 50% of the costs of repair and replacement. A recent state inspection of the County's bridges indicates that three are category 5 bridges (considered unsafe) and five are category 4 bridges. A rough estimate is that it will cost $50 million to replace the typical bridge in the County. STAFFORD COUNTY CAPITAL PLAN You have just become the director of the newly created Stafford County Capital Planning Office. In the past capital planning in Stafford County has been done informally as part of the operating budget process. Agencies were asked to include capital budget requests in with their regular budget request. Since capital projects span multiple years, agencies were supposed to submit a description of the "outyear" budgetary impact of the capital project. In addition, county legislators have controlled half of the capital budget to use for their constituent projects. Capital expenditures have averaged $20 million a year over the last several years. Stafford County is facing some significant budgetary challenges in the next decade. The local economy, has faced stagnant growth and was hit hard by the last recession. The property tax base, and the sales tax base have declined at the same time that the County faces significant capital needs: 1. Stafford County jail: The jail has experienced significant overcrowding for years. Last year, a federal judge ordered Stafford County to develop a "permanent solution" to the local jail overcrowding problem in the next year or face fines of up to $10,000 per day per prisoner above rated capacity. A similar jail constructed in another city cost $200 million. 2. A local environmental group sued the county under the federal Clean Water Act to clean-up the effluent that is being dumped into Braden Lake from the county sewage treatment plant. A federal court has ordered the County to present a plan for dealing with the effluent from the sewage treatment plant to the U.S. EPA. One estimate received by the county was $500 million. 3. Due to recent changes in federal environmental laws regarding solid waste disposal, the Illiana State Department of Environmental Conservation (DEC) is requiring counties in Illiana to prepare a "Solid Waste Management Plan". The state plans on shutting down the two landfills in Stafford County in the next five years, and the County needs to prepare plans for alternative solid waste disposal facilities. To replace one of these landfills with one meeting all environmental regulations would be $50 million. 4. The County supplies water to its residents through an enterprise fund, which covers most of its costs through user fees. The County has not done an inventory of its water pipes in 50 years. Fifty percent of the water distributed from the treatment plant leaks out before it can be used. To replace half of the pipes in the County it would take 5 years and cost $150 million. 5. The County Road Department is responsible for maintaining 20 bridges in the county. The state pays 50% of the costs of repair and replacement. A recent state inspection of the County's bridges indicates that three are category 5 bridges (considered unsafe) and five are category 4 bridges. A rough estimate is that it will cost $50 million to replace the typical bridge in the County.