Agenda No. 5.
CITY COUNCIL MEMORANDUM
| City Council Meeting: | October 14, 2025 |
| Department: | Engineering |
| Subject: | Resolution 25-R-123 - Authorizing a DEAGG funding application for the Lower Seguin Road Reconstruction Project (B.James/K.Woodlee/J.Nowak) |
BACKGROUND
Previously, Council authorized applying for a Defense Community Infrastructure Program (DCIP) grant to help fund construction of the Lower Seguin Road project. In late August, the City was notified that the DCIP grant application was unsuccessful. Since that notification, Staff and our consultant have been investigating other potential funding sources that could be used to help fund the project construction. Additionally, some Randolph military personnel reached out to us concerning the Defense Economic Adjustment Assistance Grant (DEAAG) program.
The DEAAG project provides for a smaller level of funding than the DCIP program. However, DEAAG funding can be used in conjunction with (to compliment) DCIP funding. By securing DEAAG funding for the project, we could reduce the amount requested from DCIP funding next year, which could increase the chances of securing DCIP funding.
DEAAG funding also allows for applying for funding over multiple years for the same project. This would allow for funding to be applied for certain elements of a project in one year, and other elements in another year. Staff and our consultant have identified key elements for the project, such as the undergrounding of overhead utilities in the “safety zone”; intersection improvements (including signalization) at the south gate; and drainage improvements to reduce ponding potential as being ideally suited for this funding source. In order to increase the chances of approval for this funding source, Staff is recommending that we apply for approximately $2 million for this year and another $2 million next year to fund these key elements.
Staff is recommending that Council authorize applying for DEAAG funding for the Lower Seguin Road project. With Council approval, a DEAAG funding application will be submitted this month for the Lower Seguin Road project. Staff will bring forward a similar request next year to apply for some additional DEAAG funding.
The DEAAG project provides for a smaller level of funding than the DCIP program. However, DEAAG funding can be used in conjunction with (to compliment) DCIP funding. By securing DEAAG funding for the project, we could reduce the amount requested from DCIP funding next year, which could increase the chances of securing DCIP funding.
DEAAG funding also allows for applying for funding over multiple years for the same project. This would allow for funding to be applied for certain elements of a project in one year, and other elements in another year. Staff and our consultant have identified key elements for the project, such as the undergrounding of overhead utilities in the “safety zone”; intersection improvements (including signalization) at the south gate; and drainage improvements to reduce ponding potential as being ideally suited for this funding source. In order to increase the chances of approval for this funding source, Staff is recommending that we apply for approximately $2 million for this year and another $2 million next year to fund these key elements.
Staff is recommending that Council authorize applying for DEAAG funding for the Lower Seguin Road project. With Council approval, a DEAAG funding application will be submitted this month for the Lower Seguin Road project. Staff will bring forward a similar request next year to apply for some additional DEAAG funding.
GOAL
The goal of Resolution 25-R-123 is Council authorization for the City Manager to sign and submit the DEAAG funding application for the Lower Seguin Road Reconstruction project.
COMMUNITY BENEFIT
The Lower Seguin Road Reconstruction project will widen the street to the secondary arterial roadway sections shown in the City's Master Thoroughfare Plan; provide a traffic signal and other improvements at the Randolph South Gate entrance; improve drainage; and provide a stronger pavement section capable of supporting the vehicle loading on the street. These improvements will provide a smoother driving surface and allow traffic to move more efficiently on Lower Seguin Road. The signalization and other improvements at the Randolph South Gate will provide improved access to the base and help support Randolph's mission. Securing DEAAG funding will significantly reduce the out-of-pocket costs of the project to the City and allow the improvements to be completed more quickly. The project directly supports the Strategic Goal of Infrastructure Investment and the objective of development and maintenance of transportation infrastructure.
SUMMARY OF RECOMMENDED ACTION
Staff recommends Council authorization for the City Manager to sign and submit the DEAAG funding application for the Lower Seguin Road Reconstruction project.
FISCAL IMPACT
The current estimated construction cost for the project is approximately $22,000,000. There isn’t a specific local match identified for the DEAAG funding program. The DEAAG funding is intended to provide funding to “close a funding gap” for construction of a project. The maximum amount for this funding source is $5 million.
The Lower Seguin Road project is included in the Capital Improvement Plan (CIP). When the project was created in the CIP, it was assumed that there would need to be a local match for construction, that the City would need to fund the project design and environmental clearance, and need to fund right-of-way and easement acquisition. As a result, the City allocated Bond sale proceeds to fund the preliminary design and environmental clearance tasks and began work on the project. Subsequently, the City allocated additional Bond sale proceeds to the project to fund the final design, right-of-way and easement acquisition, and for a portion of the estimated construction costs. Currently the City has a total of $15,985,000 of funding available for the project.
Of that total, $985,000 was allocated for the preliminary design and environmental clearance and $2,700,000 was allocated for the final project design. This leaves $12,300,000 of funding available for the project. This available funding would be used for right-of-way and easement acquisition; construction cost overruns; and the “local match” for the DEAAG funding. Additionally, based on the earlier project estimate when creating the CIP, an additional portion of Bond sale proceeds in the FY 25-26 is planned to be allocated to this project. This additional amount is $3,200,000.
If the additional Bond amount is not needed for the project, those proceeds could be spent on other street projects. Any other excess City funding would be allocated to other, future street projects in the CIP.
The Lower Seguin Road project is included in the Capital Improvement Plan (CIP). When the project was created in the CIP, it was assumed that there would need to be a local match for construction, that the City would need to fund the project design and environmental clearance, and need to fund right-of-way and easement acquisition. As a result, the City allocated Bond sale proceeds to fund the preliminary design and environmental clearance tasks and began work on the project. Subsequently, the City allocated additional Bond sale proceeds to the project to fund the final design, right-of-way and easement acquisition, and for a portion of the estimated construction costs. Currently the City has a total of $15,985,000 of funding available for the project.
Of that total, $985,000 was allocated for the preliminary design and environmental clearance and $2,700,000 was allocated for the final project design. This leaves $12,300,000 of funding available for the project. This available funding would be used for right-of-way and easement acquisition; construction cost overruns; and the “local match” for the DEAAG funding. Additionally, based on the earlier project estimate when creating the CIP, an additional portion of Bond sale proceeds in the FY 25-26 is planned to be allocated to this project. This additional amount is $3,200,000.
If the additional Bond amount is not needed for the project, those proceeds could be spent on other street projects. Any other excess City funding would be allocated to other, future street projects in the CIP.
RECOMMENDATION
Approve Resolution 25-R-123.