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HomeMy WebLinkAboutMinutes - 06-18-2001APPROVED 12/3/2001 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS BUDGET WORK SESSION JUNE 18, 2001 The Orange County Board of Commissioners met for a budget work session on Monday, June 18, 2001 at 6:00 p.m. at the Southern Human Services Center in Chapel Hill, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Stephen H. Halkiotis and Commissioners Margaret W. Brown, Moses Carey, Jr., Alice M. Gordan, and Barry Jacobs 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) 1. CHAIR REVIEW OF SCHEDULE AND TOPICS Chair Halkiotis read the agenda. 2. FOLLOW-UP DISCUSSION OF CAPITAL FUNDING ISSUES John Link made reference to the memorandum from him to the Board and a chart, both of which were distributed this evening. He said that the attached table shows one possible scenario for compiling a $75 million bond package for November 2001 and accomplishing a variety of other County and school capital needs through alternative financing, pay-as-you-go, certificates of participation, installment purchase, impact fee revenues, fund balance, etc. This does take into account some assumptions, which are listed below: 1) For the next four years, we would assume an overall 6.5°!° interest rate. During these four years, we are anticipating the annual growth of the general fund expenditures to be around 8.75°~. Debt service will not exceed 15% of the annual general fund expenditures. 2) The impact fee revenue will be increased far both school systems, effective July 15t 3} Within the schools' CIPs, the increase in revenue will not be budgeted for any particular project. The Chapel Hill-Carrboro school district tax revenue can be used for both capital and current expense purposes. 4} There will be a bond referendum every four to five years, sa this proposal will carry us through the year 2004-2005. He made reference to the chart and summarized the information about the needs, which were presented to the Capital Needs Advisory Task force. The functions are listed as well as the amount requested. The chart then lists potential funding options. Commissioner Gordon asked for a chart showing the debt service and the percentage of general fund expenditures for each year, out to ten years. John Link made reference to page two and said that the Orange Enterprises expansion will be paid from pay-as-you-go and other capital funds. The remainder of the items on this page deals with parkland and open space. Regarding the Chapel Hill-Carrboro school system, it is recommended far elementary schools #9 and #10 a fixed amount in bonds of $13,250,000 for each school. There is also a recommended increase in impact fees. Under high school expansion, it is recommended that the funding be addressed through a dedicated increase in district tax. Regarding renovation of older schools and facilities, $4.6 million is recommended to come from bonds. The other $2.4 million will come from the district tax or local revenues within the school system. This is a total of $31,100,000 in bonds and $11.6 million in other district resources. Under the Orange County school system, it is recommended that $18,500,000 in bands be appropriated far pursuing a new middle school. For the central office expansion that addresses the administrative requirement, it is recommended that certificates of participation be used in this case. In expanding the elementary school capacity at Hillsborough Elementary far students, it is recommended that this part be in the bond referendum. The renovations are also recommended to be in the bond referendum. The total bonds for the Orange County school system would be $20.9 million, with $1.6 million coming from alternative financing. John Link explained the bottom of the chart, which indicated a total of $75 million for bonds, $21.5 million for alternative financing, and $390,000 for pay-as-you-go funds. Commissioner Gordon asked John Link why he did not include money for a third high school in the Chapel Hill-Carrboro City School district. John Link said that this is an issue that the County Commissioners need to address. His caution to the Board as they address another high school is that committing to this high school is a commitment of $35 to $40 million. He feels that the County Commissioners need to look at the overall capacity of the high schools in the County before making this commitment. Commissioner Carey asked if some of the renovations to the older schools could be done out of the fund balance for each system in order to reduce the amount of the bond referendum. Commissioner Jacobs asked for a discussion about fund balance and how much each school system should keep as a minimum. Assistant County Manager Rod Visser said that there is no statutory requirement that a school system must have a fund balance. The major reason the school system does not have an issue with fund balance is that they have a cash flow that they can depend on. Finance Director Ken Chavious verified that there is no minimum level required far the fund balance of a school system. Rod Visser made reference to a letter from 1986 regarding the working margins of fund balances for the two school systems. For the Orange County system, it is 2.7% of its annual expenditures, and for the Chapel Hill-Carrboro system, it is 5.5%. Chapel Hill-Carrboro City Schools has received $450,000 more in the current fiscal year from the district tax than was actually budgeted. This brings their fund balance to $4.4 million. The threshold would be $1.8 million. Far the Orange County system, it would need another $450,000 to maintain the 2.7°Io threshold in the fund balance. Commissioner Carey asked if there is any reason why renovations cannot be done from fund balance. John Link said that with the Chapel Hill-Carrboro City Schools they could use the district tax monies for current expense and capital. Commissioner Jacobs questioned why Chapel Hill-Carrboro City Schools is requesting an increase in the district tax since they have a fund balance of $4.5 million. Commissioner Carey said that the fund balance gives the County and the schools more flexibility to accomplish some of their specific goals. Neil Pedersen said that he does not feel the $4.5 million fund balance takes into account the outstanding bills they have which may be $700,000. Ken Chavious said that the $4.5 million fund balance takes into consideration outstanding bills of $900,000. John Link said that the good news is that the unappropriated fund balance provides the flexibility for both school districts to address some of their needs. Commissioner Jacobs asked that a press release be written to correct incorrect information about the fund balances for each system. He said that there has also been misleading numbers for enrollment figures. Also, we need to explain that we try to address mandates and make it clear to our citizens that we are responsive to the school needs and good stewards of the citizens' money. Commissioner Carey agreed saying that we need to try to correct misconceptions. John Link will develop a draft press release and submit it to the Board for their review. Environment and Resource Conservation Director David Stancil made reference to the salman- colored document entitled, "Consideration of Bond Recommendations for Parks and Open Space." The Capital Needs Task Force did not recommend any specific projects for the Lands Legacy program, leaving it to the Board. He summarized each project and indicated whether it met each of the criteria. John Link made reference to the bond requirements. The County Commissioners will need to indicate the maximum amount they are willing to have on the bond referendum. They are not required this month to make the final decision on the projects or the amount. They can make the final decisions on the projects and the amounts in August. Commissioner Gordon feels that the Board should not wait until August to make the decision on the total amount of the bond referendum. She does not want the citizens to think that the proposed band is a higher amount. She wants to know the amount of the bond and the tax impact over the next few years. This would impact her decision for the impact fee and the total increase in the tax rate. Commissioner Carey said that he feels that $75 million is the maximum and Chair Halkiotis, Commissioner Jacobs, and Commissioner Brawn agreed. John Link agrees that to the extent the County Commissioners can make a decision on the band before the break would be beneficial. Commissioner Brown made reference to the proposed projects for the parks and said that it may be possible for Carrboro to help fund a park or the gymnasium. She also has some questions about Smith Middle School Park. She also questions whether Carrboro will consider Southern Community Park as part of their district park. Commissioner Jacobs made reference to his meeting with Chatham County and suggested sending a letter to Chatham County to see if they are interested in helping to fund the Southern Community Park. Commissioner Gordon suggested talking with the members of the Intergovernmental Parks Work Group before sending a letter to Chatham County. Chair Halkiotis will talk with the mayors to see if they are open to the suggestion of an open attitude for co-use of a facility. John Link made reference to the blue sheet, which outlines the plans for the Efland Cheeks Community Park. Purchasing Director Pam Jones said that the memo lists the highlights of phase I I of the park. She said that phase II would add some trails, add a couple of picnic shelters, stabilize the pond, add a boardwalk to get to the pond, and add barrier fencing around the perimeter. Commissioner Jacobs asked if we could conceptualize the trail system as part of the greenway system. It seems that it would be applicable. Recreation and Parks Director Bob Janes said that the greenway and trails could be incorporated into the easements of the Richmond Hills subdivision. Chair Halkiotis said that the school system met with Habitat for Humanity and designed a simple bridge crossing to allow the children easy access to the school campus rather than coming out on the roadway. Projections for the Schools Commissioner Gordon asked to talk about the projected high school enrollment far the Chapel Hill-Carrboro City Schools. She said that by looking at the projections, over-capacity is reached in 2006. She said that the Board has said that when elementary schools pass 105% capacity, middle schools 107°~, and high schools 110°~ we are going to build a school. The SAPFO is very clear that facilities are not shared. Commissioner Jacobs made reference to page two and the projected middle school enrallment. He said that it would not reach capacity until 2007. He said that we could talk about using the capacity of the new middle school to accommodate high school students. He made reference to page six and said that over the next ten years the new high school would not reach 100°lo capacity. This leads us to start to look at things a little mare holistically. He said that there is a need to talk about alternative programs and magnet programs, and get citizens together to talk about the pros and cons of one central administrative facility. He would like to see what the options are. He wants to make the best use out of the facilities and make sure that children get the best possible education. Commissioner Brown agreed with Commissioner Jacobs in sharing facilities as a real possibility with the opening of all the new schools. It will be up to the County Commissioners to show the leadership to start this discussion. The Board agreed that sharing should take place bath between school districts and within school districts. This is an enormous opportunity far cooperation of the actual buildings, allowing children to use both school systems, and finding out how these costly facilities can be shared and used to the optimum. Commissioner Gordon asked how this would impact the bond. If we are talking about sharing facilities then we need to look at the bond projects to see which are necessary. In the Chapel Hill- Carrboro City Schools the two Elementary Schools are necessary. There could be some sharing in the middle schools. Regarding the high school numbers, it is clear that another high school in the CHCCS would be needed by 2QQ5-2QQ6. She said that if we are going to talk about sharing facilities, we need to talk about it soon. She feels that if we expect the schools to share we need to let them know that now. That brings up the question of whether or not we should have these schools on the bond referendum if we decide to share facilities. Commissioner Carey said that dialogue should take place. However, it cannot realistically be done in time for this bond referendum. He feels that the incentive needs to be what we include in the band. The two school boards need to take leadership in this process. Commissioner Jacobs said that John Link has mentioned in this document some alternative funding for expansion of high school facilities if that should be required between bond referendums. He agrees with Commissioner Carey about creating incentive. He made reference to the School Merger Task Force Report from the mid-198Q's and read from it as follows: "Encourage the school districts to investigate areas where economies may be affected by joint operations such as transportation, food service, and maintenance. Encourage the school districts to pursue areas of educational cooperation such as special services." He said that we should be revisiting what a group of people worked for a year to come up with 15 years ago. John Link said that the original request from the Chapel Hill-Carrbora City Schools was to expand both high schools and he understands that their current alternative is to build another high school. He has suggested that if necessary these expansions can happen between the bonds. Commissioner Brown said that she has heard so many people say that if there is going to be a third high school in Chapel Hill, it should be shared with Orange County. Chair Halkiotis said that nine years ago the people in Raleigh considered having one school system per County. We have heard this year during the Innovation and Efficiency Committee meetings the issue of merger. He agrees with going back and revisiting the report from 1985 and 1986. It cannot happen this year. In order to look down the road he feels we need to be prepared. He feels that there should be two people from the County Commissioners, members from the two school systems, and members from the municipalities to meet together and look at the issues of capacity and merger. It is not going to help us in this budget cycle but we can position ourselves down the road. Chair Halkiotis said that, as a result of the Innovation and Efficiency Committee, this Board heard a request and approved a request from the Robert S. Segal group to go in and look at the operation of County government. He thinks we should challenge both school systems to take advantage of the organization and open themselves up for scrutiny. The staff will develop a proposal for the two school systems as proposed by Chair Halkiotis. Commissioner Gordon explained the graphs on school enrollment. These are herein made a part of the record by reference. She also made reference to the Tischler projections as presented to the Schools and Land Use Council. Tischler used a different projection method for the Orange County School (OCS) district versus the Chapel Hill Carrboro School (CHCCS} district. For the OCS a linear method was used while for the CHCCS a linear extrapolation method was used in order to decrease the impact of the recent spike in enrollment in the CHCCS. If the linear method had been used for the CHCCS, more students would be projected than were projected by the linear extrapolation method. She presented this for the Board's information. Equitable Allocation of Funds for County Projects Commissioner Gordon said that when the County Commissioners passed the policy for parks, she thought that it was a mistake. She has written same memos about this. She thinks the retroactive policy in regards to parks is something that the County Commissioners should not do. She supports being equitable to all parts of the County. She feels that a more general statement of the commitment to equity would be better than a specific statement as to the timeframe and geographic boundaries. Commissioner Brawn said that she was not at the meeting when this policy was approved. She said that the Intergovernmental Parks Work Group discussed this and was concerned that the policy did not address everything. The policy made it appear that there was anorth/south issue in the County in terms of funding for parks and open space. She made reference to the four bullets on the memo from the Intergovernmental Parks Work Group. The work group is asking the Board to reconsider the adopted language. She thinks that it is great to reassure the public that the Board is approaching the infrastructure in a fair and equitable manner. She would like to move away from northlsouth issues. Commissioner Jacobs said that this was considered at two separate meetings. He was using the 48.1 °In as a target but not as a rule. This reaffirms that the County Commissioners try to achieve a balance. He said that until 1997, the County has not created any new facilities north of Hillsborough. He does not see it as a point of division. Commissioner Brawn wonders why it was necessary to say this and asked if it was to reassure the public. Commissioner Jacobs said that, to him, it was to reassure the public and to demonstrate to citizens that we have a wider purview to include municipalities. Commissioner Carey said that it does not matter what we say but what we do. People want parks and recreation areas near where they live. We have to continue to do the best we can. Chair Halkiotis said that if it had not been for the people in southern Orange, the Efland Sewer line bond referendum would not have passed. There were members of the Capital Needs Task Farce who greatly supported doing what is best for all. He is concerned about the point in the memo from the Intergovernmental Parks Work Group that says, "and may prove counter-productive to the bond education campaign this fall." He does not want anything to be counter-productive to the bond education campaign. He suggested that a couple of the County Commissioners get together with the Intergovernmental Parks Work Group and work through the issues. He said that he does not feel we need a policy. He said that we have been fair and equitable because we involve so many people in the process. He suggested that a group come together in July to reconsider this policy. Commissioner Jacobs will go with Commissioner Brawn to the Intergovernmental Parks Work Group meeting. Commissioner Gordon asked why this was limited to park projects and why we did not include all projects on the bond. She suggested adopting a more general policy if we are going to adopt any policy. A motion was made by Commissioner Carey, seconded by Commissioner Brown to get a group together in July to reconsider this policy. VOTE: UNANIMOUS 3. COUNTY DEPARTMENT AND NEW STAFF RESOURCES REVIEW Public Safety Regarding emergency services, Commissioner Jacobs said that there have been some concerns about the private ambulance service with which the County contracts and how its service is inadequate. He asked where this is reflected and if we are looking to improve it or change it. John Link said that the service was through Johnson Ambulance and it was for non-emergency transportation. EMS Director Nick Waters said that the concerns they receive usually stem from an incorrect expectation about what Johnson Ambulance does. They do not address emergency issues. They will be reviewing this aspect of EMS. Commissioner Jacobs invited Nick Waters to attend the next Department on Aging Board meeting to hear the concerns from the alder citizens in our County. John Link encouraged the Board to speak with other franchises to see if anyone is willing to come into Orange County and provide this service. Public Works Commissioner Brown asked if public works maintains all of the parks or if it was someone else. Wilbert McAdoo said that Recreation and Parks does the grounds maintenance at the Efland Community Center. John Link said that he went out to the Efland Cheeks multi-purpose field because of a complaint he received. He said that the orange soil is not going to provide the grass surface necessary for a soccer field. He feels the County needs to spend more time up front on the development of fields. Chair Halkiotis said that he was talking with the co-owner of Creekside Turf. They have sold five times mare turf than they thought they would. He will work with John Link this summer about the possibility of getting sod for this field. Chair Halkiotis made reference to a letter from a citizen asking about the Sheriff's presence at the Efland Community Center and the Sheriff has sent out a memo fully supporting a presence of the Sheriffs Department at the facility. He would like for there to be a sign at this facility stating that this is a Sheriff's sub station and the hours. Solid Waste and Landfill Operations Commissioner Brown made reference to the convenience center. She asked if there is a particular reason why this department cannot handle the Eubanks Road convenience center. John Link said that this is an area that can be discussed. They had not considered separating out one of the convenience centers from the others. An area we can look at during the break is the relationship between ERCD and Recreation and Parks. A decision on whom is going to maintain the active recreation fields needs to be made. Rod Visser said that, under the interlocal agreement, each of the jurisdictions remain responsible for collection. The County's general fund would have to reimburse the Landfill fund. POSITIONS Commissioner Jacobs made reference to the translator and the medical interpreter. He questioned the amount of this position and what we would be saving from what we spend far these services at this time. Health Director Rosemary Summers said that the $6,000 would be new revenue (offsetting) because of the increase in the Hispanic/Latino clients. The $30,000 that was anticipated when the report was first prepared was an the high side. It will actually cost $15,000 for interpreters. We will still need to maintain contracts with languages other than Spanish. She said that they tried to be very conservative in determining the cost savings. Solid Waste The two new positions are involved with recycling C&D. This is on page 72 of the budget document. Solid Waste Director Gayle Wilson said that one of the positions is a construction and demolition Education Specialist that will help set the stage for a comprehensive ordinance regulating construction and demolition. The position would be engaged in education for several months until the ordinance comes into effect and then it would be a combination of education and enforcement. We will focus more on the education component. This position would begin work immediately with the contractors on job-site waste management. The other position is a Recycling Materials Handler that will assume the responsibility for the governmental in-house recycling program from Public Works, the dry cell battery recycling program, and operations of the electronics-recycling program. Commissioner Jacobs questioned the in-house program. Gayle Wilson said that there are three providers. Orange County Public Works does the recycling at the buildings in Hillsborough, and the Solid Waste Department operates programs and also contracts office paper to Orange Recycling Services. Under the proposal in the budget, these providers would be consolidated in the Solid Waste Department and a private company would no longer be used. Economic Development Commission Commissioner Gordon asked about the ERCD and Agricultural Economic Development Specialist positions. Donna Dean said that she has since responded to the County Commissioners on these two positions and the update is included in the budget document. John Link said that the change in this status is the receipt of a grant. Page 33 has a copy of the grant letter. Fletcher Barber said that they actually asked for $20,000 but the position is going to be funded 50°~. Chair Halkiotis said that this is wonderful news and he thanked Extension Director Fletcher Barber and Economic Development Director Dianne Reid. Environment and Resource Conservation The other position is an Environment and Resource Conservation Open Space Design Specialist. This is on page 27. David Stancil said that the idea of this position was an ecologically minded landscape architect to help the County in the design of open space. He said that this position could pay for itself because concept designs are quite expensive. They are talking to the School of Design at NCSU. Commissioner Brawn asked if we this person will be expected to take an area of the Northern Park and do a design. David Stancil said that this person would be out there with the contractor to be sure the trails are done right. Arts Commission The recommendation is to go from part-time at 30 hours to full-time at 40 hours. Commissioner Gordon asked what would be done with these extra hours. Arts Commission Director Ann Kaplan said that part of the time would be to help arts organizations around the County to be profit bearing. Other responsibilities include working mare strongly with the EDC and with the Skills Development Center. Commissioner Brown questioned if the expansion of the position is based on their strategic plan and Ann Kaplan said yes. Commissioner Brown said that some of the arts organizations did not want to be profitable and they were concerned about the Arts Commission pushing them toward being profitable. She said that this goal was not totally supported by the Arts Committee. Tax Assessor's Office The recommendation is to convert the position of Tax Clerk in the Revaluation division from time-limited to permanent. Tax Assessor John Smith said that revaluation never ends. The main thing that this position is designed to do is to gather new information. He said that by the year 2005, it will be impossible to do revaluation using the current methodology. Chair Halkiotis made reference to use value and compliance and asked if the Assessor's Office is monitoring use value to be sure that people are in compliance. John Smith said that they are finding that most are in compliance. There may be less than 1 °k not in compliance. Chair Halkiotis said that it was significant that Orange County has the highest percentage of the total landmass in use value of any surrounding county. Health Department Health Director Rosemary Summers said that the expansions in dental are due to the sheer increase in the workload. There has also been an increase in revenue in the dental program with third-party billing and private pay percentages. One of the intensive home visiting positions is funded by Smart Start and the other two and a half are a combination of state funds and revenues through Medicaid reimbursement. There has been great difficulty in keeping staff in this program because of the time-limited status of the positions. The positions have turned over three times in three years. The Public Health Nurse I is due to the low record of reconciling our immunization rates with the statewide registry. The Health Department has had an increase in communicable disease incidence in the last 4-5 years and they need the increase in staff to respond to daily needs. Orange Public Transit Transportation and Department an Aging Director Jerry Passmare said that the position of Transportation Coordinator is a ten-hour increase in an effort to expand services to those who cannot ride public transportation. This position would be working with DSS and the Work First program and the Commission for Women. Planning The recommendation is to increase a GIS Technician's position from time-limited to permanent full-time. Planning Director Craig Benedict said that a lot of the maps that have been presented at meetings have been done primarily through the County's GIS system. This is atime-limited position and he is asking that it be permanent. Recommended Fee Schedule -Building Inspections Division Craig Benedict made this presentation. He distributed charts, which outlined the fallowing: • Residential Permit Fee Comparison Chart • Percent of Change Applied to Proposed Fee Increase • Single Family Permit Cost Comparison • Permit Costs as Relates to House Value • Single Family Dwellings, Categorized by Square Footage, Orange County School District •:• Single Family Dwellings, Categorized by Square Footage, Chapel Hill School District within Orange County Inspections Jurisdiction The new fee schedule will allow for a recovering of cost far larger homes. At the current fee schedule, the County actually is losing money for larger homes. The new fee schedule also decreases costs for smaller houses approximately 1,800 square feet or less. The fee increase will recover 90°~ of the cost of the Building Division area. Some of the 10°~ not recovered includes assisting the customers that come into the office, etc. The current fee schedule only recovered 64°~ of the cost. Cast recovery includes the Building Division, personnel costs, recurring capital costs (cars}, operating expenses and administrative costs. Commissioner Brown suggested a news release on this fee increase. Several other clarifying questions were answered by Craig Benedict. Commissioner Jacobs made reference to page 17, Building Demolition, and said that it will be important to have a meeting in the fall to talk about solid waste issues, to include C&D and deconstruction versus demolition. It needs to be determined whether a time limit far getting a demolition permit might facilitate people choosing the alternative of saving money and saving materials, versus the disadvantage of taking more time. Craig Benedict said that he has been working with Gayle Wilson on the C&D permitting process to make sure it ties into the building permit process. One thing that they have done with the fee schedule to promote affordable housing is to reduce the fees for the project. The rate would be reduced if part of the project offers affordable housing. Recommended Fee Schedule -EMS Nick Waters said that the increases have to do with the realignment of the charges to match the new Medicaid reimbursement scheme. Recommended Fee Schedule -Environmental Health Rosemary Summers said that these fees are set at about 76°~ cost recovery, which would cover the cost of the new position being requested. She made reference to page 7. Fees cannot be charged for the Food and Lodging program. Fees can only be charged for the wells and wastewater program. The existing fee schedule recovers about 61 °I° of the cost. Commissioner Jacobs asked about licensing well drillers or contractors who put in wastewater treatment systems. Ran Holdway said that there is a license required by the state for well drillers and a certificate for wastewater providers. He will look at the possibility of licensing by Orange County for possible cost recovery and reassurance to citizens. Rosemary Summers summarized the various inspections that are done in the County. Medicaid Issues (pSS} John Link said that he has included $300,000 in the budget far Medicaid to address the requirements of the state for County participation. This is on page 7-4 in the budget document. 4. EMPLOYEE PAY & BENEFITS PLAN John Link said that the budget includes his recommendation for this year as to the specific percentage increases for cost-of-living, 401(k), etc. Personnel Director Elaine Holmes gave a PowerPoint presentation. The pay and benefits plan was discussed at the November work session and at the April work session. The County Commissioners were satisfied with the pay and benefits plan and wanted to continue in the same direction for the coming two years with additional direction. The meritorious service awards will be improved as well as the County 401 (k) contribution. The staff will pursue a countywide position classification and pay study. The Manager is recommending acost-of-living increase of 2.5°~ effective July 1St. The social security adjustment for 2001 and 2002 was 3.5%. The recommended budget continues in-range progression at 2.5°k. The recommended budget includes funding to increase the 401 (k) contribution from the present $15 to $20 per pay period. The recommended budget includes funding for the countywide classification and pay study. She said that she has put forth a request for proposal for this study. There will be a consultant recommendation at the June 25tH meeting. The recommended budget also includes funds to offer benefits for domestic partners effective January 1, 2002. The recommended budget includes an increase in the living wage from $8.45 an hour to $9.11 an hour effective July 1St. This affects about 60 temporary employees. Commissioner Jacobs asked about the $25,000 recommended in the budget for benefits for domestic partners. Elaine Holmes said that the costs would begin an December 1St. She thinks the cost estimates are relatively high. Commissioner Brown asked for the definition of a domestic partner. Elaine Holmes said that it was unmarried adults that live together and have some type of financial interdependence and are not related. There would be a policy that would include a specific definition of a domestic partner as defined by Orange County. Commissioner Gordon asked if people have to live together for a certain amount of time to be considered domestic partners and Elaine Holmes said that there is typically Hat a time period. Chair Halkiotis agreed that the cost estimate for the insurance for domestic partners seems high. Elaine Holmes said that the cost estimate includes the cost of the benefits and the additional casts on the County's health insurance. 5. OUTSIDE AGENCY AND FIRE DISTRICT FUNDING Rod Visser said that there are twelve fire districts in Orange County. Four fire districts requested tax rates at the post-revaluation equivalent tax rate. Eight fire districts have requested tax increases. The Manager has recommended an increase for six of the fire districts. These increases are due to equipment needs. Cedar Grove and Little River need to replace 20-year old trucks. The increase for South Orange is based on a 20-year old contract that the County has with the Town of Carrboro to provide municipal fire protection. The budget includes a .35-cent tax increase for South Orange, which is driven by a formula where the fire district pays a proportion for the number of calls and the tax base. Rod Visser said that there is some question about how much of Southern Village may actually be in the South Orange district. Page 8-15 in the budget document lists all the tax rates. Commissioner Brown asked why the tax in South Orange would have to go up just because of Southern Village. Rod Visser said that the South Orange fire district pays about 26-27°~ of the Tawn of Carrboro's fire department budget. If the tax base decreases, then the formula will change. The two fire departments that asked for an increase and were not recommended are Eno and New Hope. The reason for not approving these increases was because they have large fund balances. Chair Halkiotis asked for a list of all of the fund balances for all the fire districts. He said that the fire departments should da competitive bidding on equipment. Commissioner Jacobs asked for an explanation of the new outside agencies, which were not funded this year. He would like to know the rationale for the decision not to fund. He noted that the increase for the Dispute Settlement Center is the largest. He raised the issue that when the County wanted to use the Dispute Settlement Center, we could not avail ourselves of their services even though we are providing tens of thousands of dollars. They do great work but when we try to avail ourselves of their service, he would like to get some consideration in return for the generosity. John Link said that the only reason an increase is recommended is because of a special program. Commissioner Brown asked about the Institute of Government funding. It was answered that there is a capital contribution of $2800 per year and that annual dues are paid. Commissioner Brawn said that she has called the Institute of Government several times and has never received a response. John Link said that he is very distressed to hear this. He said that Michael Smith would want to know this. Commissioner Brown asked about the Disability Awareness Council. She said that they are residing at the Skills Development Center, which does not charge any fees for their space. She recommends that the new Social Services Director work with the Disability Awareness Council to determine how what they want to do affects services they want to offer. John Link said that his recommendation is that there be stipends for specific training needs that the Disability Awareness Council may have. Commissioner Carey suggested including stipends but putting it in escrow until the DSS Director can meet with the Disability Awareness Council and further define their needs. 6. REVIEW OF 2-1-4 CENT TAX INCREASE SCENARIOS John Link made reference to the memo to the Board dated June 18, 2001, Observations Regarding 2001-02 School Requested Budgets. He said that the overall increase in the recommended school funding is 7.5°~ and not 1.75%. He said that the 1.75% relates to the increase in the per-pupil funding that was recommended. He thinks that it is unrealistic to expect that the total current expense funding can approach what has been in the past at 8-10%. The reason is the high debt service for school projects. He spoke about three options that could be pursued to address, in particular, the Orange County system's needs. Option one is that some amount of the pay-as-you-go funding that has been earmarked for debt service for Cedar Ridge High School could be replaced with some of the additional revenue from increased impact fees. The pay-as-you go funding could potentially be used by the school system for current expense. This requires an agreement of the County Commissioners and the two school boards. Option two is to reduce the Chapel Hill district tax by one penny and increase the countywide tax by one penny. This would create an additional $350,000 for the Orange County system, and a net reduction of $35,000 for the Chapel Hill-Carrboro system. Option three is responding to the request by the Orange County system to mitigate the additional appropriation put into the nursing program. Increasing the contract that would go from the Health Department to the Orange County system for school nurses could do this. Commissioner Gordon asked for information about using impact fee revenue for projects retroactively. She asked if the Board of County Commissioners must fund just as the Schools Adequate Public Facilities Ordinance says. County Attorney Geoffrey Gledhill will provide this information to the Commissioners as soon as possible. Commissioner Jacobs said that, assuming that the schools have these undesignated fund balances, what could be done so the schools will use these fund balances. John Link said that the County Commissioners could make observations far how the schools could best use their fund balance. He said that an observation could be made that part of Orange County's fund balance could be used toward the start-up costs for Pathways. For the Chapel Hill-Carrboro school system, an observation could be made that the fund balance could be used for start-up costs for Smith Middle School. Commissioner Jacobs said that he favors option one. He does not see why the district tax is being raised in Chapel Hill-Carrboro. Chair Halkiotis said that he endorses option one. He would not support option two, but would support option three. He feels that option one would have the greatest flexibility. Commissioner Gordan said that the Orange County system is concerned about their operating budget while the Chapel Hill-Carrboro City Schools is concerned about their capital budget. She asked that, as we proceed forward, that the County Commissioners remember both sides. Commissioner Brown asked John Link how they could get the schools to use their fund balances. John Link said that the County Commissioners could not force the school system to use their fund balances. The County Commissioners could reduce the County contribution so that they would not have a choice but to use their fund balance. The County Commissioners could make observations or recommendations. Commissioner Jacobs said that he was not saying that we should cut the district tax but he also does not want to increase the district tax for the Chapel Hill-Carrboro City Schools. Commissioner Carey noted that the County Commissioners could not force the schools to use their fund balance. The County Commissioners can make recommendations. He does not want to cut the district tax but he is also not sure we need to increase the district tax. Commissioner Gordon said that there are tremendous capital needs for the Chapel Hill-Carrboro City Schools and she would recommend using the fund balance for one time capital improvements instead of cutting the district tax. 7. ADJOURNMENT A motion was made by Commissioner Brawn, seconded by Commissioner Carey to adjourn the meeting at 10:30 p.m. VOTE: UNANIMOUS The next Board of County Commissioners meeting is scheduled for June 19 at 6:00 p.m. at the Southern Human Services Center in Chapel Hill, North Carolina. Stephen H. Halkiotis, Chair Beverly A. Blythe, CMC