The City of Billings currently maintains the State-owned highway system within the Billings city limits through an agreement with the State of Montana. This agreement covers all of the activities ordinarily associated with street maintenance activities including street patching, sweeping, storm sewer repair, snow plowing, snow removal, ice control, street striping, and vegetation control. This agreement does not include the signal maintenance and sign replacement duties for those routes. A second agreement for emergency signal maintenance is also being carried forward for council approval as a separate agenda item.

The State of Montana will pay the City of Billings $439,470 in FY 2011 for regular street maintenance, including a contribution to the City’s Equipment Replacement Program. These revenues provide reimbursement for the costs of all actual street maintenance labor and materials, as well as for estimated overhead costs. Revenues, as well as the corresponding expenditures for street maintenance projects for FY 2011, are included in the proposed FY 2011 budget. The existing maintenance contract that will expire June 30, 2010, is for $392,278.

Staff recommends that the City Council approve the Maintenance Agreement between the City of Billings and the State of Montana.