Loading...
HomeMy WebLinkAboutMinutes - 05-24-2001APPROVED 11!712001 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS BUDGET PRESENTATION May 24, 2001 The Orange County Board of Commissioners met on Thursday, May 24, 2001 at 7:30 p.m. in the F. Gordon Battle Courtroom in Hillsborough, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Stephen H. Halkiotis and Commissioners Margaret W. Brown, Alice Gordan, and Barry Jacobs COUNTY COMMISSIONER ABSENT: Moses Carey, Jr. COUNTY ATTORNEY PRESENT: Geoffrey Gledhill COUNTY STAFF PRESENT: County Manager John M. Link, Jr., Assistant County Manager Rod Visser and Clerk to the Board Beverly A. Blythe {All other staff members will be identified appropriately below) NOTE: ALL DOCUMENTS REFERRED TO IN THESE MINUTES ARE IN THE PERMANENT AGENDA FILE IN THE CLERK'S OFFICE. ALL RECORDINGS OF THE MEETING WILL BE KEPT FOR 5 YEARS. 1. Presentation of County Manager's FY 2001-2002 Proposed Budget John Link made this presentation. He thanked all those involved with putting the budget document together. He made a Pawerpoint presentation. A summary of this presentation is shown below. The milestones for 2000-01 are as follows: • Orange County has remained #1 in total contributions per pupil for education. • The County has made remarkable progress in the Lands Legacy program by adding 459 acres to the inventory of publicly held property since last year at this time (Little River Park - 135 acres, Chapel Hill Township District Park - 193 acres, and 7-Mile Creek Preserve - 131 acres}. • There has been a better collaboration with Hillsborough on the Economic Development Districts. • An agreement has been reached on water/sewer boundaries between the County, OWASA, and the towns. • Orange County was the first to adopt the Neuse River storm water discharge regulations in the Triangle. • The American Stone rezoning case has finally been resolved. • A comprehensive process to determine County and School capital needs has been established with the appointment of a Capital Needs Task Force and reports from Board of County Commissionerslstafflcitizen task forces. The budget highlights for 2001-02 are as follows: • General Fund Budget totals $117.7 million {increase of $8.7 million over the current budget). • Tax rate set at 81.5 cents, which is an increase of 3 cents aver the equivalent post- revaluation rate. • Increased per pupil funding of $42 per child (from $2,394 to $2,437). • Recommendation includes employee pay and benefits plan confirmed by the Commissioners during November and April work sessions. Recommended new staff - 10.5 general fund positions and 2 Solid Waste positions. Chapel Hill-Carrboro City School District tax rate is set at 20.2 cents, an increase of 2 cents over the equivalent post-revaluation rate. John Link said that Orange County remains strong in its financial condition. Orange County ranks 5th in the state for revenue collections. Orange County has also retained a healthy fund balance. Regarding the other funding sources, the one-cent sales tax growth remains strong at 6.5 to 7 percent. The half-cent sales taxes have grown 4 to 5 percent. The North Carolina County Commissioners Association is recommending that all counties budget far full reimbursement from the State for inventory and intangible taxes. Investment earnings are the equivalent of 2 cents an the property tax rate. The total recommendation for funding for education is $57.9 million, which is a $4 million increase. This includes addressing an increase of 724 new students, including projected charter school students. It also addresses increases in school debt resulting from recent sales of certificates of participation for Cedar Ridge High School and 1997 voter approved school bonds. He explained a chart, which showed the disparity of growth between the two school systems. The Chapel Hill- Carrboro school system has grown significantly more in terms of students than the Orange County school system. The recommendation far education funding includes 49.2°~ of the general fund compared to the target of 48.1 %. One-half cent has been shifted to current expense from the normal 3-cent earmarking for recurring capital. Both systems will receive about the same amount of recurring capital. This shift allowed for the $42 per pupil increase compared to a $15 per pupil increase, all other elements being equal in the budget. He explained the per pupil allocations of each district. The total amount funded of what was requested by the Chapel Hill-Carrboro system was 93% and for the Orange County system was 88.6°Io. There is a need for the Orange County system to examine the possibility of a district tax, at least in the short term. The recommended budget includes phase one of the school health nurse initiative. This equates to $154,000. Based on the phased-in approach, two nurses would go to the Chapel Hill- Carrboro system and one nurse to the Orange County system. The Human Services issues are as follows: • Increases in Medicaid cost • Urgent Hame Repair program -County will assume this responsibility • Mental Health funding -increased by $95,000 • Child care subsidies reserve to address waiting lists -additional $50,000 recommended. This is for the Board to consider as a challenge to other jurisdictions and to the University. Regarding employee compensation, the Board confirmed the directions but the actual percentages will be addressed as part of the budget deliberations. The recommendations include a 2.5°~ cost of living increase effective July 1, 2001; continuation of in-range salary progression of 2.5% for proficient or higher; increase in 401 (k} plan contribution from $15 to $20 per pay period; and funding far Classification and Pay Plan study. Recently the Board discussed the recommendations for new staff resources. These resources address the following issues: • Health and safety of diverse and low-income citizens • Improved response in managing major emergency incidents • Timely and mare thorough inspections of residents' home construction projects • Environmental compliance inspection for public health • Comprehensive planning for Orange County's future • Diversity and retention challenge of County employees The year 2000 was a year of celebrating solid waste milestones. There was a very smooth transition of solid waste management from Chapel Hill to Orange County. The main water line is being constructed in the Rogers Road neighborhood and will be completed in the fall. Construction of a final cell of lined MSW landfill on Eubanks Road has been completed, with an in-house savings of $300,000. The Board approved in concept a new, small C&D landfill as part of a master solid waste site plan at Eubanks Road. There is also now a citizen Solid Waste Advisory Board that is making recommendations to the Board on solid waste issues. The MSW tip fee is recommended to increase from $42 to $45ltan. The C&D tip fee is recommended to increase from $40 to $41lton. One dollar per ton from each of those projects is earmarked far the next phase of the Rogers Raad waterline project. There is also funding recommended to implement additional recycling initiatives. On the horizon, one of the big issues is the November 2001 bond referendum. There is an estimated two-cent tax rate impact from the sale of most of the remaining 1997 bonds. There will be start up costs far Cedar Ridge High School. The Commissioners will need to seriously address the need for alternative solid waste financing next year. The County will need to examine options for EMS transport service delivery system. The rescue squad is facing a reduced number of volunteers. Finally, the County's comprehensive plan is in need of an update. In closing, John Link outlined the public hearings and work sessions for the budget as well as the location where the budget document can be reviewed. He indicated that the budget is scheduled to be adopted no later than June 25, 2001. Commissioner Gordon made reference to the likely debt impacts from alternative financing of capital projects, which was mentioned in the section, "an the horizon," and asked John Link if he has anything in mind. John Link said that as the County Commissioners receive the report from the Capital Needs Task Force the County Commissioners may reduce the total amount of the bond leaving some projects for certificates of participation. Commissioner Gordon asked about the amount of start up costs for Cedar Ridge High School and alternative financing of solid waste matters. John Link said that they have not developed those numbers yet, but it will be in the hundreds of thousands of dollars. The alternative financing will depend on how soon the County Commissioners want to pursue recycling goals. A Materials Recovery Facility (MRF} and a transfer station are the two items that Commissioner Gordon feels are large ticket items. John Link said that this would depend on the alternatives that the County Commissioners decide. There are many alternatives for the County Commissioners to consider. His point in raising alternative financing as an item is that tipping fees as the sole source of revenue will not be sufficient in the coming years. Commissioner Gordon requested the line item detail of the budget for all the County Commissioners. She asked for additional information on Medicaid increases. John Link said that it is hard to pinpoint any particular factor. Overall, across the state the criteria have been broadened for mare people to be included under Medicaid. The costs have increased for services and prescription drugs. Commissioner Gordon made reference to the school funding recommendations and the one-half cent shift and asked if the two superintendents had encouraged this. John Link said that the superintendents understand the reasoning behind this recommendation. He said that this option is not a surprise to the superintendents. He feels that this may be a one-time occurrence. Commissioner Gordon asked for an explanation of recurring capital and current expense. Jahn Link said that recurring capital funding is far repairs, replacement equipment (HVAC, roofs, and sidewalks} and is not a major capital project such as an addition to a building. Current expense is the operational expense for the schools (the County's share of paying for the teachers, administrative staff, and supplies}. Commissioner Gordon asked about the elements of the $2 million of school related debt. Assistant County Manager Rod Visser said that the two elements are the certificates of participation to pay for half of Cedar Ridge High School and the remaining 1997 band sale of $17 million . Commissioner Brawn asked about the mental health funding and the childcare subsidy. John Link said that the funding that comes from the state is not adequate to address the waiting list for childcare. Regarding the mental health funding, John Link said that the Mental Health Area program is working very hard to address the needs of the mentally ill. Same of the state funding sources are going to be cut and he anticipates further cuts in the funding for mental health. Chair Halkiotis made reference to the cutbacks in Smart Start funding. He is afraid that there may be further cuts in the Smart Start program. He also feels that the mental health funding will be decreased and the responsibility for funding will be placed on the counties. He asked that we be proactive in our thinking and look ahead to what may happen with these two issues. Commissioner Jacobs made reference to the undesignated fund balance and the projection this year of 11.34% and asked what is anticipated for the year 2002. Finance Director Ken Chavious said that they would have a better answer after the audit is done. Commissioner Jacobs said that he thinks that helping to provide some of the people with an opportunity to better themselves is a goad tradition to continue. He would also look upon the undesignated fund balance as a way to provide some flexibility to address some of the issues of "unfunded" mandates. Commissioner Jacobs asked about the affordable housing funding and John Link said that there is $250,000 in the budget for this item. Also, there is a separate amount for the urgent repair program. Commissioner Gordon made reference to charter school students and said that her understanding is that the per pupil allocation is first given to the school district and then paid by them to the charter schools far operating expenses. John Link said that this was correct. Commissioner Gordan said that, far purposes of operating expense and current expense, charter schools have to be funded; but for purposes of capital, they do not because the state regulations do not require the provision of any capital money. She asked how DPI handles charter school students. Budget Director Donna Dean said that DPI does not count Charter Schools but leaves that up to the individual school district. The State receives a monthly report on charter school enrollment. There are currently 360 charter school students in the County. Rod Visser made reference to charter schools and said that the State law has not caught up with charter schools. He thinks that the law should be changed to include the charter schools. Chair Halkiotis said that he is still not convinced that DPI projections are accurate. He feels we need to have some flexibility with respect to the actual number of students who attend schools each year. Chair Halkiotis invited all citizens to the two budget public hearings -May 31 S` at the Southern Human Services Center in Chapel Hill and June ~h in the F. Gordan Battle Courtroom in Hillsborough at 7:30 p.m. Commissioner Brown asked for the figures for a zero tax increase, and John Link said that these would be ready the first of next week. 2. Orange County's Round 3 Application for 1_0 MGD Jordan Lake Level II Allocation County Engineer Paul Thames said that he has talked with the Division of Water Resources about what the County needs to do to retain the County's existing allocation. He said that it comes down to the fact that the County has to be able to prove that there is a need for the allocation. He said that the only thing that he could use to generate numbers that would make the County's case is the water shortage situation in the Orange-Alamance service area. Orange-Alamance's own water supply plan shawl that they have a 600gpd shortage from a water supply planning standpoint. Orange-Alamance has no plans for developing a permanent source of water supply. He used that justification to prove a need for the existing allocation. Commissioner Brawn said that this sounds like a serious basis for the application for the allocation. Paul Thames said that the census projections in the Efland-Cheeks area do not take into account the potential development of the EDD and the exponential demand for subdivisions. Even without that, in just the Efland corridor alone, in 50 years the demand is going to increase by 400,000 gallons. He would guess that in a 50-year period, under normal growth conditions, the shortfall just in the Efland-Cheeks area could reach one million gallons per day. Commissioner Brown supports this request of retaining the allocation. Commissioner Gordon asked, since different jurisdictions are growing at different rates, would the County have to give the allocation to someone who was growing much faster now. Her perspective is that this is an area in Orange County where there is growth and there is a need for water in this location. She said that she would downplay the fact that the County is not the utility provider. The need for water in this area can be demonstrated, and just because we do not have the pipeline in place does not mean that we do not need the allocation. She feels the verbiage should be stronger in the application and suggested the following verbiage in the application: "In conclusion, Orange County has plans for an Economic Development District. We have a limited role as a sewer utility, but there is obviously going to be a need for a substantial infrastructure here, and that one million gallons is critical." Commissioner Jacobs agreed with Commissioner Gordon and said that we should talk about the positives. He said that we have had an allocation since the very beginning and have demonstrated our interest from the very beginning. He said that it should be addressed in the application that we help to protect this water supply by our policies and watershed protection measures. He thinks it is incumbent upon the state to provide water to those who make a sacrifice to provide the resource. Also, Orange county has been working on cooperative relationships with the water providers in this County as well as the Town of Hillsborough on the EDDs. He feels we should move forward with reserving this allocation. Chair Halkiotis said that we need to emphasize that we have a cooperative relationship with Orange-Alamance. Orange-Alamance knows that they have a problem with not having enough water resources for future growth. He agrees that we should not point out the County's lack of standing as a water utility. A motion was made by Commissioner Brown, seconded by Commissioner Jacobs to adopt the recommendation of the Manager, which is to direct staff to modify the application to meet the Board's requirements and submit the application by the May 31, 2001 deadline, and that staff work with Commissioners Gordon and Jacobs to incorporate the comments into the application. Commissioner Brown asked if anyone that received an allocation would be able to sell water to Greensboro. Paul Thames said yes, but with a lot of qualifiers. Commissioner Jacobs suggested that the EDD on the map be crosshatched. Also, once the letter is formalized, he asked that it be sent to Orange-Alamance before the board meeting on May 31St with a cover letter thanking them again for their hospitality and stating that this is the beginning of a fruitful relationship in helping to address the water needs in central Orange County. Commissioner Gordon asked about supporting OWASA's current allocation. Paul Thames said that he had planned to write a separate letter related to that. The letter is not as time critical as the application. Chair Halkiotis suggested that copies of the application letter be sent to the legislative delegation. VOTE: UNANIMOUS ADJOURNMENT With no further items for the County Commissioners to discuss, a motion was made by Commissioner Jacobs, seconded by Commissioner Brawn to adjourn the meeting at 9:13 p.m. VOTE: UNANIMOUS The next meeting on the calendar will be held next Tuesday, May 29, 2001 at 7:30 p.m. in the F. Gordon Battle Courtroom in Hillsborough, North Carolina. Stephen H. Halkiotis, Chair Beverly A. Blythe, CMC