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HomeMy WebLinkAboutMinutes 10-26-2010 APPROVED 12/6/2010 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS BUDGET WORK SESSION October 26,2010 7:00 p.m. The Orange County Board of Commissioners met for a session on Tuesday, October 26, 2010 at 7:00 p.m. at the Link Government Services Center in Hillsborough, N.C. COUNTY COMMISSIONERS PRESENT: Chair Valerie P. Foushee, and Commissioners Alice Gordon, Pam Hemminger, Barry Jacobs, Mike Nelson, Bernadette Pelissier, and Steve Yuhasz COUNTY COMMISSIONERS ABSENT: COUNTY ATTORNEYS PRESENT: COUNTY STAFF PRESENT: County Manager Frank Clifton and Clerk to the Board Donna S. Baker(All other staff members will be identified appropriately below). A motion was made by Commissioner Gordon, seconded by Commissioner Jacobs to approve adding a closed session at the end of the meeting for the purpose of: "To establish, or to instruct the public body's staff or negotiating agents concerning the position to be taken by or on behalf of the public body in negotiating (i)the price and other material terms of a contract or proposed contract for the acquisition of real property by purchase, option, exchange, or lease, NCGS 143-318.11(a)(5)", VOTE: UNANIMOUS 1. Public Hearing—Orange County Community Development Block Grant(CDBG) Program Infrastructure Hook-Up Program-$75,000 The Board held a public hearing regarding a proposed application to the N. C. Department of Commerce for Small Cities Community Development Block Grant (CDBG) Program funds for an infrastructure Hook-Up Program in the amount of$75,000. Housing, Human Rights, and Community Development Director Tara Fikes said that the Board held a public hearing on October 4th regarding applying for this program prior to actually completing the application. At that time, members of the Rogers Road community asked for assistance with utility connections in the neighborhood. Since that time, staff has worked with the Rogers Road community and identified eight homes that could be served by this program. Three of those homes need connection to public water, four of them need connection to public sewer, and one needs connection to both. The cost estimates are in the agenda packets and the total amount would be$75,000. The applications are due on October 29th and must provide another opportunity for citizens to comment prior to submitting the application to the State. A motion was made by Commissioner Pelissier, seconded by Commissioner Jacobs to close the public hearing. VOTE: UNANIMOUS Commissioner Nelson arrived at 7:07 PM. 2. Budget Process FY 2011-12: Outside Agency Application Funding The Board received background information regarding the Outside Agency funding process for the FY 2011-12 budget cycle. Assistant County Manager Gwen Harvey said that this item is a continuation of the conversation that the Board began back in the spring regarding the prospective applications for outside agency funding. The applications were dealt with during the budget work session in the summer. The Board ultimately adopted a budget that included allocations for a number of those agencies. Not all agencies were funded. The Board now needs to decide how to proceed for the upcoming budget session. Commissioner Hemminger arrived at 7:08 PM. Commissioner Yuhasz arrived at 7:08 PM. Gwen Harvey asked the Board for guidance on how the staff should proceed. She made reference to Attachment 2, which were responses to the"big"questions from the County Commissioners. 1. What is the basis for why an Outside Agency is selected for Orange County Funding? Commissioner Gordon said that one of the big questions that she had is not on this sheet. She thinks that there should be some place that indicates a direct benefit to residents of Orange County, along with location and delivery of services in Orange County. Frank Clifton said that several of these agencies, in trying to create administrative efficiencies, have streamlined and may not be physically in Orange County but serve and benefit Orange County. Commissioner Gordon said that she would like to at least put it in the table and it could be on a checklist. The Board agreed. Gwen Harvey said that in the actual application and also in this scoreboard there is specific reference to Program Beneficiary Characteristics and also fair and appropriate value for Orange County resident customer benefits. This is part of the criteria that is scored in looking at the application. Commissioner Gordon said that she wants this added to the list for discussion. Gwen Harvey made reference to Attachment 2 and said that this is a list of potential responses and is not exhaustive. The basis for funding includes supporting the social safety net, a historical relationship with the County, performance ranking, a unique mission, financial need, a new initiative, etc. Commissioner Hemminger said that there are things the County has to provide and things that are nice to provide. She said that she really would not like to go on the historical relationships precept, and she would prefer to be objective each year with all of the applications rather than subjective. She does not think the County should commit funding on a "forever" basis. She would prefer to review each application each year. Commissioner Pelissier said that she would like to cross off"financial need" as a criterion because every non-profit has a financial need. She said that the overwhelming criterion is the social safety net. The one concern she had with the performance review and ranking is that an organization can get a high ranking if it has a good program, but it may not meet the County's needs. She would like to revise this criterion. Commissioner Yuhasz said that the objective is to fill a gap and he would not like to fund agencies that provide the same services that the County provides. Commissioner Jacobs agreed that it is redundant in a way to have financial need as a criterion, but there is a line, "the outside agency has demonstrated a reliable, diverse revenue stream, of which governmental assistance is a small portion." He does not want to lose that because this was a principle that the Board discussed. He said that there is something to be said for historical relationships since some agencies are small non-profits, but it should not entitle the non-profits to anything. Also, he said that there are times when some groups have financial emergencies, and if it falls within the County's process, then the County can assist if possible on a one-time basis. Commissioner Gordon made reference to the meeting of goals and said that maybe it could be based on a point system. If an agency meets certain goals of the County, then they would be given points, etc. Chair Foushee made reference to historical relationships and said that she agreed with Commissioner Jacobs, but she also thinks that in the case of some small non-profits, there is an issue that some organizations do not seek other opportunities because there is an expectation of funding based on the historical relationship with the County. She would caution against this. Frank Clifton thanked Gwen Harvey for her efforts in this process. He said that he wanted to reinforce an issue. Some of the agencies are under contract with the County. Some of these non-profits are supported with straight contributions and then the County pays them through contracts sometimes. He asked the Board to go through each criterion and say "yes" or"no" as a group. Commissioner Hemminger said that a matching grant should not be a requirement. Frank Clifton said that maybe these could be given a higher priority, but not made a requirement. He will continue to bring recommendations, and the Board can decide. Chair Foushee went over the criteria that the Board supports. The Board agrees with support for social safety net, performance review ranking (with revisions), unique mission or service, principal partnership, and a financial need statement. She said that she did not hear as much support for the other items. Commissioner Gordon made reference to the matching grant and said she did not think that needing county dollars for a grant should be a reason to provide funding. She said an additional criterion for selection should be whether or not funding an agency leverages county dollars. One way for an agency to do that is to use volunteers, Frank Clifton said that at the State level, the State is pushing Smart Start groups to find dollars elsewhere rather than just relying on State allocations. Now Smart Start is asking the counties for contributions. He does not think that the County should be doing this just because the State is shifting money elsewhere. Commissioner Nelson said that all of these criteria are important. He understands that some decisions may become subjective. He is not comfortable saying that one set of criteria is more important than another. Chair Foushee said that if the Board believes all criteria are important, then they should be incorporated in the application and weighted. Commissioner Gordon said that geographic balance is important. Commissioner Yuhasz said that he agreed with Commissioner Nelson and that the reason these criteria are on the list is because they have been used in the past to evaluate applications and they are valuable in certain situations. Chair Foushee said that if matching grants are considered, then those funds will be leveraged. Also, she would like to ensure that whatever services are being provided would fill a gap and would not be a duplication of County services. Also, the County Commissioners would be willing to consider one-time emergency funding. She does not want to take anything off the list. 2. Does funding in one year carry forward to a commitment to future years? Commissioner Yuhasz said that he agreed with Commissioner Hemminger's previous comments. The County Commissioners should review each agency on a yearly basis and not on historical relationships. Commissioner Nelson agreed with that, but the only caveat is that sometimes an agency will go through an expansion and will need a commitment for a certain amount of time. Generally, he agrees with reviewing each year. Commissioner Jacobs said that he thinks what the agency did with the money before should be an evaluation criterion and whether or not it met the expectation. The Board agreed that, for the most part, funding would not carry forward to a commitment in future years. 3. Should a limit to considered to the level of funding given to a single Outside Agency in a given year and should there be a particular limit in total dollars to all Outside Agencies in a given year? Gwen Harvey said that this has two moving parts-agency by agency or a limitation as a whole. Discussion ensued about how many non-profits have a relationship with the school system, and how that complicates putting a limit on outside agency funding. Commissioner Pelissier said that if there is not a limit on the percentage of the overall budget, this is when a non-profit becomes susceptible to going totally under if the County decides to stop funding. She thinks that the County's contribution should not be a majority of any non-profit's funding. She thinks that a percentage limit should be set received by the combination of the County and the Towns. If a non-profit is receiving more than 50%of the budget from the local government, then the local government should contract with the non- profit to provide that service as opposed to handing over the money. Commissioner Gordon agreed with having a limit of no more than 50%total from the County and the Towns. Regarding a flat rate, she does not know what that should be because as time goes on, the County will be less and less able to fund outside agencies. Commissioner Hemminger said that she does not want to tie the contribution to a percentage of the County's revenues and she would rather the County Manager come forward with what the Board of County Commissioners did the year before, etc. Commissioner Jacobs said that he does not think that a dollar amount can be set. He said that this has to be flexible and suggested using the amount funded in the previous year as a starting point. He pointed out financial need and read, "the outside agency has demonstrated a reliable, diverse revenue stream upon which governmental assistance is a small portion." He said that this is a strong statement and means more than just a percentage. Commissioner Gordon said that the suggested flat dollar amount could be a percentage of the total County budget. Frank Clifton said that he does not see the County budget changing from last year. Commissioner Pelissier said that she does not want to set a flat dollar amount because it boxes the County in if there are exceptions that need to be made. Frank Clifton said that it might be that the County encourages non-profits to merge together to lower overhead and the County would help fund that process. There are a lot of "competing" agencies right now that provide similar services. Chair Foushee said that funding from governments should not be more than 35%of an agency's funding. Commissioner Yuhasz said that if the purpose is to not make them dependent on County dollars, then they should not be dependent on County dollars. Commissioner Jacobs suggested getting some data on what percentage of the County's funding makes up the total budgets of these entities. Commissioner Hemminger suggested leaving the percentage at no more than 50%for now. Commissioner Yuhasz suggested looking at a declining percentage. Chair Foushee said to use the target amount from last year's funding to start with as the total amount. The Board agreed. 4. Are there any other defining criteria the BOCC wants to assert for future Outside Agency selection and funding? Gwen Harvey said that this was a catch-all question. Commissioner Jacobs made reference to the bullet at the top of page 12, "support that brokers a new partnership or collaboration with a County operating department," and said that this should be considered. Commissioner Yuhasz made reference to the net value of County space and said that he does not believe the County should be giving free space to any outside agency. Frank Clifton said that he will be bringing back to the Board of County Commissioners the draft facility policy on November 18th. He said that some agencies use County space for free and this does not show up in the County budget. He is looking into these. Commissioner Pelissier agreed with not preserving overall funding. Regarding the partnerships, she would like this phrase put back in the first section without the dollar amounts. Chair Foushee reviewed what the Board had agreed upon: - The first three bullets on page 11 for#4 will be removed. - The first bullet on page 12 and the principal program statement will be incorporated in the first section. - Eliminate funding for agencies whose primary mission is not related to the social safety net. Commissioner Jacobs suggested some wording: "brokers of new partnership or collaboration of the County operating department, preferably related to support of social safety net." Chair Foushee asked about the"net value of facilities" and Frank Clifton said that he would categorize it and give a summary of what he finds and a best estimate of the value of those assets. 3. Review of the New Format for the County's Capital Investment Plan (CIP), Including Revisions to the Existing Capital Funding Policy and Dept Management Policy The Board reviewed proposed changes in format for the County's Capital Investment Plan, as well as changes in the Capital Funding Policy and Debt Management Policy included in the CIP. Michael Talbert from Financial Services said that this is the second look at this item and he reviewed the formatting for the CIP. Most of the numbers were not real numbers and were just there for illustration. He said that he forgot to add the Sportsplex Enterprise Fund and asked if the Board would like to add this, even though there is not a large capital improvement plan for that facility. The Board asked that it be listed as an additional item. Michael Talbert went through the spreadsheets. Commissioner Jacobs made reference to page 8 and said that there is a footnote about library proceeds. He said that the first time it occurs, it would be useful to note that this is not a Board of County Commissioners' determination and the County is a passive recipient. He said that this is subject to change and it is not under the County's control. Commissioner Pelissier asked if there was a project summary and Michael Talbert said that there should be a page for that. It is the same format. Commissioner Gordon said that the two school systems list their projects differently and that makes it difficult to follow. She asked what could be done about this. Frank Clifton said that the two school systems are working to resolve this issue. Commissioner Pelissier said that she would prefer that the format be like CHCCS. Michael Talbert made reference to the Active County Projects on pages 10-11. There will probably be about 6-10 projects on this list that will be closed on this fiscal year. Commissioner Gordon asked why there was a revenue shortage in Hillsborough Commons. Michael Talbert said that there are revenue shortages because there is still revenue yet to come in from Medicaid, etc. Michael Talbert pointed out pages 12 and 13, which had actual figures on it. The debt service is currently at 16.33%. Commissioner Jacobs made reference to page 3 of Appendix 3 and the Debt Policy. He read, "the County will strive to maintain its annual debt service costs at a level no greater than 15%." Instead of calling it a target, it is called a policy. For two years the level has been over 15%. He said that this should say"target" instead of"policy." Commissioner Gordon said it should be left as"policy." Frank Clifton said that one of the reasons the percentage went up is because the County's budget went down. He said that the rating agencies look at that. Chair Foushee said to draft a footnote to this effect. Michael Talbert highlighted the changes on the Debt Management Policy, Attachment 3. Following is the policy as presented by Michael Talbert, with some of the changes suggested by the Commissioners at the end of the presentation. ORANGE COUNTY BOARD OF COMMISSIONERS DEBT MANAGEMENT POLICY The County has long recognized the importance of proper long-range planning in order to meet capital improvement needs as they arise without experiencing dramatic impacts on operational cost and debt service. The following policy statements will provide guidance on the issuance of dept to help insure that the County maintains a sound debt position and that its credit quality is protected. In conjunction with the County's Capital Policies,these policy statements rationalize the decision making process, identify objectives for staff to implement, and demonstrate a commitment to long term financial planning objectives. In addition,this debt management policy will allow for an appropriate balance between the established debt parameters and providing flexibility to respond to unforeseen circumstances and new opportunities. POLICY STATEMENTS Purpose and Type of Debt 1. Incurrence of debt or long-term borrowing will only be used for the purpose of providing financing for capital projects to include, but not limited to: a. Construction of new School and County facilities b. Renovation and repair of existing School and County facilities c. Acquisition of real property (land and/or buildings) d. Construction or expansion of Public Utilities. e. Providing funds for Affordable Housing Projects f. Construction, acquisition and development of Parks g. Purchase of major equipment Debt issuance will not be used to finance current operations or normal maintenance. 2. The types of debt instruments to be used by the County include: a. General Obligation Bonds b. Bond Anticipation Notes c. Installment Purchase Agreements (private placement) d. Special Obligation Bonds (landfill only) e. Certificates of Participation, when feasible f. Revenue Bonds 3. All debt issued, including installment purchase methods, will be repaid within a period not to exceed the expected useful life of the improvements or equipment financed by the debt. 4. The County will not issue tax or revenue anticipation notes. 5. The County will not issue bond anticipation notes with maturities in excess of one year. 6. The County will strive to maximize the use of pay-as-you-go financing for capital improvements. Issuance of Debt 7. The County will strive to issue bonds no more frequently than once in any fiscal year. The scheduling of bond sales and installment purchase decisions and the amount of bonds to be sold and installment financing to be sought will be determined each year by the County Commissioners. These decisions will be based upon the identified cash flow requirements for each project financed, market conditions, and other relevant factors. These factors will be ascertained from the school systems and County departments. If cash needs for bond projects are insignificant in any given year,the Board may choose not to issue bonds. Instead,the Board may fund up front project costs and reimburse these costs when bonds are sold. In these situations the Board will adopt Reimbursement Resolutions prior to the expenditure of project funds. 8. The County will seek level or declining debt repayment schedules and will avoid issuing debt that provides for balloon principal payments reserved at the end of the term of the issue. 9. The County will avoid over-reliance on variable rate debt. Variable rate debt will only be considered when market conditions favor this type of issuance. When variable rate debt is considered, careful analysis will be performed and techniques applied that will ensure that the County's sound debt position will be maintained. At no time will variable rate debt exceed 20% of the County's total outstanding debt. 10.The County is required by Statute to issue general obligation debt through a competitive process. The competitive process will also be used for other debt issuance unless time factors, interest rates or other factors make it more favorable to the County to use a negotiated process. 11.In the planning process for debt issuance the County will assess the need to maintain its "Bank Qualification" if installment purchase financing is being considered. Level of Debt 12.The County will maintain its net bonded debt at a level not to exceed three percent of the assessed valuation of taxable property within the County. 13.The County will strive to maintain its annual debt service costs at a level no greater than fifteen percent of general fund revenues, including installment purchase debt. This is a recommended "best practice"from the Government Finance Officers Association. Advance Refunding of Debt 14.The County will make every effort to issue advance refunding bonds to achieve cost savings of at least 3% percent net of the refunding bonds. Net savings includes gross savings less issuance costs and any cash contributions to the refunding. The 3% savings is the minimum savings permissible before the North Carolina Local Government Commission will consider advance refunding bonds. These decisions will be based upon the maturity date of the refunded bonds,the call date and premium on the refunded bonds and the interest rates at which the refunding bonds can be issued. Undesignated Fund Balance 15.The County will strive to maintain an undesignated balance in the general fund of 17% percent of budgeted general fund operating expenditures each fiscal year. The amount of undesignated fund balance maintained during each fiscal year should not fall below 8% percent of budgeted general fund operating expenditures as recommended by the North Carolina Local Government Commission. 16.To the extent that general fund undesignated fund balance exceeds 17% percent the balances may be utilized to fund capital expenditures or pay down outstanding County debt. Investment of Capital Funds 17. Investment of capital funds will be performed in accordance with the North Carolina General Statutes (159-30). Funds will be invested in instruments that will provide the liquidity required to meet the cash flow needs of each project funded. 18. Investment earnings on capital funds, after subtracting required or potential arbitrage,will be used for project costs and/or debt service. Bond Ratings 19. The County will maintain good communications with bond rating agencies regarding its financial condition and will follow a policy of full disclosure on every financial report and offering statement. 20. The County will strive to maintain bond ratings at or better than AAA(Fitch), Aa2 (Moody's Investor Services) and AA+ (Standard & Poor's). Arbitrage Rebate and Secondary Market Disclosure Requirements 21. The County will comply with all arbitrage rebate requirements as established by the Internal Revenue Service and all secondary market disclosure requirements established by the Securities and Exchange Commission. 22. Arbitrage will be calculated at the end of each fiscal year and interest earned on investment of bond or installment purchase proceeds will be reserved to pay any penalties due. Enterprise Funds 23. For any Enterprise Fund that is supporting debt, an annual rate study will be performed to ensure that fees or rates are sufficient to meet the debt service requirements. Capital Reserve Funds 24. The County will create and maintain capital reserve funds as appropriate, such as for school and county projects. 25. The Capital Reserves will be funded from property tax revenues, sales tax revenues and/or any other revenue source that the County Commissioners may choose. 26. Funds accumulated in the Capital Reserve Funds will be used on a pay-as- you-go basis to finance renovations and repairs to existing buildings and the purchase of major equipment. The Board may also choose to fund other pay- as-you-go initiatives from Reserve Funds. 5-Year Capital Investment Plan (CIP) 27. The County will review and adopt a five-year CIP annually. 28. This Debt Management Policy will be incorporated into the CIP. 29. The County will strive to include plans for debt issuance within the CIP. Rescission This policy supersedes any policy in place prior to this date. Approved , 2010. It was pointed out that there were two#16's. Commissioner Gordon made reference to the first page, fourth line down, and pointed out a typographical error, "issuance of dept." Also, under Policy Statements, item 'd', she suggested saying "construction or expansion of Public Utilities," instead of"all Public Utilities." Commissioner Jacobs said to take out the bold format. Commissioner Gordon made reference to#21 and added, "to pay penalties due." Michael Talbert then went through the changes on Attachment 2, Capital Funding Policy. The biggest changes included taking out all references to recurring capital. Also, regarding the Lottery Proceeds(p. 2), there was a substantial change that allows the counties to request those funds on an annual basis for debt service as opposed to individual projects. Following is the policy as presented by Mr. Talbert. Orange County Board of Commissioners Approved Capital Funding Policy Preamble This capital funding policy is the product of extensive analysis and deliberation. The intent of this policy is to reflect greater priority than there has been historically on providing funding for County projects, with particular emphasis directed at enhanced upkeep of existing County facilities. The policy reflects the implementation of the Board of Commissioners' resolution of November 16, 2004 that the Board "does hereby adopt in principle a policy of allocating a target of 60 percent of capital expenditures for school projects and 40 percent of capital expenditures for county projects over the decade beginning in calendar year 2005". This policy continues the County's principle and historical practice of funding all School and County related debt service obligations before allocating any other School or County capital funds for other purposes. Long Range Capital Investment Plan During January of each fiscal year, the County Manager shall present, to the Board, five-year County and School capital needs and funding plans in the form of a Capital Investment Plan. Each year, the Board of Commissioners shall conduct a public hearing on the Manager's Recommended CIP during March and subsequently adopt a five-year Capital Investment Plan (CIP) as part of the annual operating budget in June. I County and School recurring capital needs will be identified and reviewed during each annual ,- Deleted:.¶ operating budget cycle, and recurring capital appropriations will be approved by the Board of ¶ Commissioners as an element of each annual Orange County Budget Ordinance. Deleted:. The five-year plan for long-range capital funding shall include anticipated County and School / ,(Deleted:¶ capital expenditures costing$100,000 or more. (Deleted:<#>¶ Sources of Funds (Deleted: Deleted:<#>It is the intent of the The County will allocate the following sources of funds for County and School debt Board of County Commissioners to dedicate the equivalent of four cents on service and long-range and recurring capital: the annual ad valorem property tax to funding recurring capital expenditures • All proceeds from the Article 40 and Article 42 half-cent sales taxes. o; for schools(three cents)and county(1 cent). However,there will be times (The North Carolina General Statutes require that 30 percent of the Article 40 ° when the County will be bound fiscally (NCGS§105-487(a)) and 60 percent of the Article 42 (NCGS§105-502(a)) sales tax and unable to achieve full funding. During those times Commissioners revenue be earmarked for public school capital outlay as defined in NCGS§105-426(f) may finditnecessa,ry to depart from the or to retire any indebtedness incurred by the county for these purposes) oi Policy.During the 2008-18 Capital Investment Plan development process, • School Construction Impact Fees for each school system. ; the Board will consider a timetable for phasing in the additional two—cents • property tax revenue as needed and approved by the Board, ; necessary to fully the recurring capital component of this policy.¶ (This 4-cent rate may,but need not,be adjusted with each quadrennial The County will budget NC Education Lottery proceeds as the revenues are distributed by revalualiontoa revenue neutral • earmarking)¶ the State each quarter, once the revenues are identified for an individual school capital <#>Beginninginfiscalyear2007-08, project and requested by each district. the County will budget NC Education Lottery proceeds in arrears"—meaning that funds will be budgeted in the year Debt Service after the State distributes them. For example,lottery proceeds distributed to All County and School related debt service obligations would be funded prior to allocation of the County during the upcoming 2007- 08 fiscal year would be budgeted the programmed funding for any other capital purposes. following fiscal year,2008-09.¶ „Orange County Schools' impact fees will be earmarked +o pay for debt service on projects that , Deleted: of North Carolina Public annual y p ¢ p y p � allocations of North Carolina Public involved the construction of new school space in the Orange County Schools system. Chapel School Building Capital Funds will be Hill-Carrboro City Schools' impact fees will be earmarked,to pay for debt service on projects earmarkedexplicitlyto pay for eligible that involved the construction of new school space in the Chapel Hill-Carrboro City Schools, ¶chool debt se vice.¶ system. These ex.enditures will be tracked and verified b each district annuall . y i Deleted:explicitly 9 I Deleted:explicitly NC Education Lottery Proceeds ach school district will have the option to dedicate its share of the annual NC Education t h,-!Deleted:Beginning in fiscal year p 2008-09,each Lottery monies.to address school facility renovation needs or,as.edditional revenue to the districts pay-as-you-go funding to address school facility renovation needs. „,A nnually either o, Before:tt0 pt Body Text 3,Space district an re.uest that the Count dedicate Lotteryproceeds to repay debt service and,the °,, ,Deleted:either(1)to repay debt county will,substitutepay-as-you-coo-fundincgto expedite approved capital projects in the ,\\,, service for debt issued after fiscal year ; ,schools capital improvement plan. '�,, 2006-07 ',,,,'`f Deleted:(2) � Allocation ',y0` Deleted:an ) a•ital fundin. for each five- ear capital •tannin. •eriod will be allocated between the two 1'';,';,\.Deleted:lf school districts based on the student membershi. .lannin. allotments •rovided b the NC Deleted:chooses to Department of Public Instruction each fiscal year. Deleted:,Lottery proceeds,sufficient ' ,\ to cover annual debt payments for .� '� ■' principal Capital Project Ordinances—Form and Purpose it '{Deleted:interest, ) All funds allocated to capital projects are to be accounted for in a Capital Project Fund as ', Deleted:be dedicated for the life of authorized by a Board of County Commissioner approved Capital Project Ordinance. , , ' the financing.¶ The Capital Project Ordinance will include a detailed break down of each major cost category B inning in fiscal year 2008-09, related to the project. � , during ■ r Deleted:first quarter of each year, In accordance with the Board of County Commissioners November 2000 adopted "Policy on ', County staff will request,from the Planning and Funding School Capital Projects", whenever School capital project bids are either ', accumulated d in the Lotteryfund for higher or lower than originally projected, or any other factor affecting the project budget ', both school districts with the intent of occurs, the affected school system is expected to work with County Management and Budget , expending those funds during the fiscal staff to present revised capital project ordinances for adoption by the Board of Commissioners. [ year for ualS School capital payments oje is � or individual School capital projects as The same expectations shall be applicable for changes to County Capital project budgets. , , identified by each districts during their ' annual update of their ten-year ' Deleted:With the exception of the Community Use of Schools ,■ revenues earmarked for School and It is the intent of the Board of County Commissioners to evaluate each new proposed school in County recl and Construction Maurring nagement capita a functhe tion,the both School Districts for joint community use opportunities, including, but not limited to, park , net proceeds of all programmed and recreation use. revenue sources after debt service obligations have been satisfied will be allocated on the basis of 60%to 'r schools and 40%to the County.if Schools Adequate Public Facilities Ordinance -;,\ I Capital funding for each ten-year Orange County's Schools Adequate Public Facilities Ordinance (SAPFO) and Memoranda of ,capital planning period will be all ,,,Di Understanding (MOUs) between the County and its municipal and school partners establish Formatted:Normal,Indent: Left: the machinery to assure that, to the extent possible, new development will take place only ,;o.zs when there are adequate public school facilities available, or planned, which will accommodate Deleted: in the"S-Capital¶ , As outlined in the"Sources of Funds" such new development. The Board of County Commissioners is committed to the principle I,I, section of this policy,recurring a,,,[2] that new school space documented as needed through the annual SAPFO technical review ',' Formatted:Normal,Tabs: 0.5°, process will be reflected in the next adopted CIP, and will be funded so as to be constructed to , Left be available before the relevant level of service threshold is exceeded. t Formatted:Font: 11 pt,Bold Rescission I This •olic su.ersedes an •olic in 'lace 'nor to this date. -!Deleted:Thispolicyrescindsthe Orange County Board of Commissioners Capital Funding Policy, as originally approved on December 7, I Approved, , 2010. 1996 amended .¶ended o February 3, 1998 and as Deleted:April 24,2007. Commissioner Gordon made reference to page 2 and Allocation and asked where the November 15th numbers from the SAPFO report would relate to this. Michael Talbert said that the two are not related. The local numbers are SAPFO numbers, and they drive the basis for the Capital Improvement Plan. The ADM numbers projected in the early spring would be used for the entire year to be consistent. Commissioner Gordon made reference to the recurring capital. She asked if the reason that the recurring capital was deleted was because the County could not afford to go from the two cents to the four cents. Michael Talbert said that he is not sure of the reason, but he knows that it was not popular with the Board because what was in the policy was not being done. Chair Foushee said that the discussion was that the County was not doing what was in the policy. Commissioner Jacobs said that in the minutes from that meeting it says, "Frank Clifton recommended taking the language out about the 3 cents and 1 cent because there is still the 60/40 policy. The Board agreed." Commissioner Gordon asked if anything about recurring capital should be in the policy. Frank Clifton said that he would rather not have a policy that is not followed. Commissioner Gordon said that these policies are important to the County's partners, including the school systems, and once it is decided, then the policies should be brought back to a work session and send it to the two school systems for feedback. Chair Foushee agreed about having formal comments from the school systems. Commissioner Gordon said that it would be a good idea to inform the Towns that the County is changing the CIP from ten years to five years, even though the Board has agreed that there will be a list for 6-10 years out in the CIP documents. Commissioner Hemminger said that she would like some statement in here about recurring capital. Michael Talbert said that recurring capital is a line item in the annual operating budget. The Capital Funding Policy is for longer term capital needs. Chair Foushee said that there is a statement on the first page and this is sufficient. Commissioner Hemminger asked that this statement be in bold. Commissioner Jacobs said to add somewhere in the policy the DPI numbers. These are usually available March 15th each year. Michael Talbert said that the school systems will be sent a draft of these policies as they currently exist, with a request for input. Closed Session A motion was made by Commissioner Jacobs, seconded by Commissioner Hemminger to go into closed session at 9:03 p.m. for the purpose of: To establish, or to instruct the public body's staff or negotiating agents concerning the position to be taken by or on behalf of the public body in negotiating (i)the price and other material terms of a contract or proposed contract for the acquisition of real property by purchase, option, exchange, or lease, NCGS 143-318.11(a)(5). VOTE UNANIMOUS RECONVENE INTO REGULAR SESSION A motion was made by Commissioner Hemminger seconded by Commissioner Pelissier to reconvene into regular session at 9:30 pm. VOTE: UNANIMOUS Adjournment A motion was made by Commissioner Hemminger seconded by Commissioner Pelissier to adjourn the meeting at 9:30 pm. VOTE: UNANIMOUS Valerie Foushee, Chair Donna S. Baker, CMC Clerk to the Board Page 13: [1]Deleted Author With the exception of the revenues earmarked for School and County recurring capital and the Construction Management function, the net proceeds of all programmed revenue sources after debt service obligations have been satisfied will be allocated on the basis of 60% to schools and 40% to the County. Capital funding for each ten-year capital planning period will be allocated between the two school systems based on certified student membership as of November 15 each year. Page 13: [2]Deleted Author Recurring Capital As outlined in the "Sources of Funds" section of this policy, recurring capital funding for the Schools and County will be based on the estimated proceeds of 4 cents on the annual General Fund property tax rate. The proceeds from 3 cents will be earmarked for schools, with funds allocated to each school system for the next fiscal year based on each system's respective share of the student membership as of November 15 immediately preceding the next fiscal year. Proceeds from 1 cent on the tax rate will be earmarked for County recurring capital needs. With regard to County Equipment and Vehicle acquisitions accomplished using third party financing, the Board of County Commissioners will determine the source of funding to repay the associated debt service at the point that the Board approves the financing arrangement. Construction Management Function Beginning with the 2005-06 fiscal year, the Board of Commissioners will appropriate funding to establish a Construction Management function to oversee County and School capital projects. In fiscal years 2005-06 through 2007-08, $100,000 will be allocated annually to fund this function. The source of funding for the Construction Management function will be split on a 60/40 basis with each school district sharing the schools portion of funding (60%) in accordance with certified student membership as of November 15 each year. Each entity's share of this function will be deducted from its share of long-range capital funding prior to allocating capital funds.