09122020 North Main Street Intersection

In this Thursday, Aug. 20, 2020, photo, a truck makes turns from Highway 12 onto North Street at an intersection targeted for a reconstruction project to reduce the number of vehicle crashes and injuries. The city has allocated additional funds to the project due to inflation and other cost fluctuations.

CLAREMONT — The state’s delay to begin an 18-year-old city intersection project will now cost Claremont more money than the city originally allocated.

The Claremont City Council approved Wednesday by a vote of 7-2 the appropriation of $88,416 from the city’s Municipal Transportation Improvement Fund to cover estimated excess costs for the intersection reconstruction at North Street and Main Street, a joint project between the city and New Hampshire Department of Transportation (NHDoT) was originally earmarked in 2002.

The reconstruction project aims to improve public safety along the corridor by shifting the main traffic continuity from Main Street onto North Street, creating wider turn lanes and wider shoulders for pedestrian and cyclist safety.

In 2011, the city and state agreed to a matching grant whereby NHDoT will cover 80% of the project costs and Claremont will fund 20%, which was estimated at the time to be $885,000.

Claremont funded its obligation in 2011 through a $785,000 bond and an additional $100,000 allocated in the 2011 municipal budget.

Nine years later NHDoT is finally tackling the project, but inflation and other cost fluctuations over time have increased the project’s estimated cost to $4.8 million, making Claremont’s obligation now $973,416, about $88,000 more than previously projected.

“This really has been a long period of time,” Planning and Development Director Nancy Merrill explained to the council. “And ultimately something that long is going to impact costs.”

Merrill said that most projects do not typically take this long to complete, though this particular project was one of three federally-earmarked city road projects at the time. The other two projects, being the reconstruction of upper Main Street and the Draper’s Corner intersection, have been completed.

The state has not stated a reason for the project’s delay, though Merrill noted that NHDoT uses a 10-year plan to prioritize projects, typically based on urgency, community impact and projected funding.

The council appropriated the outstanding funds from the Municipal Transportation Improvement Fund, a capital reserve fund created by the city in 2006. The city funds the reserve using revenue collected from a $5 fee included in annual vehicle registrations. The fund, authorized by NH RSA 261:153 allows municipalities to establish this reserve fund to support a broad range of transportation system improvements, including and pertaining to roads, bridges and pedestrian traffic.

According to Finance Director Mary Walter, the city generates $75,000 annually from 15,000 vehicle registrations into the reserve, which currently holds about $331,000.

By taking the money from the capital reserve, the additional project cost will not impact the city tax rate.

The city money raised in 2011 is currently in a savings account. City Manager Ed Morris said the money generates interest though did not indicate how much interest has accumulated to date.

The city has not been financially impacted from interest on the 2011 bond, as the interest rate is only a small fraction of a percent, Walter said.

According to Claremont Projects Manager Tom Krebs, $61,837 of the city’s project share has been spent to cover the cost of a project study and preliminary engineering for the project.

The state is currently in right-of-way negotiations with property owners, Krebs said. Construction is projected to begin in spring of 2022 and expects to be completed in 2023.

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