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HomeMy WebLinkAboutMinutes - 20020624APPROVED 10115/02 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS BUDGET WORK SESSION JUNE 24, 2002 The Orange County Board of Commissioners met for a budget work session on Thursday, June 24, 2002 at 7:30 p.m. in the boardroom of the Southern Human Services Center in Chapel Hill, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Barry Jacobs and Commissioners Margaret W. Brown, Moses Carey, Jr., Alice M. Gordon and Stephen H. Halkiotis. 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. John Link introduced the new Assistant County Manager, Gwen Harvey. The County Commissioners welcomed her. 1. CHAIR REVIEW OF SCHEDULE AND TOPICS Chair Jacobs said that in putting together the agenda, he tried to allot a certain amount of time based on the assumption that we have had previous discussions on items 2 and 3. He suggested going through the capital projects and talking about the matters dealing with employees and then take a break to do some calculating. After the break, the Board will review other items by exception and then consider the Resolution of Intent, which will be adopted on June 27tH 2. OVERVIEW OF MAJOR CAPITAL DECISIONS Chair Jacobs went over the summary of proposed changes to the bond and alternative- financing plan dated March 7, 2002. He said that the changes shaded in purple are recently made changes based on comments from the County Commissioners regarding changes in priorities. Particularly, the Board wanted to move money forward for the Lands Legacy program, treat the senior centers equally in terms of funding sources, and have conservation easement money available at regular intervals across the six-year period. Also, regarding the parks, recreation, and open space changes, the Board wanted to treat the projects equally to the greatest extent possible. Budget Director Donna Dean added that the planning money set aside for January 2003 for Orange County middle school #3 has been moved to 2003-2004 fiscal year. The total funding for the project does not change and it does not change the timetable. Commissioner Halkiotis asked how they were going to delay the addition to the Board of Education main office but move ahead with the Hillsborough Elementary School renovations when one depends on the other. Donna Dean said that the renovations that were included in the bond would be done and the renovations to the office area would be postponed. Commissioner Gordan asked about the possibility of moving ahead with some of the renovations to Hillsborough Elementary School dealing with air quality issues and the media center and delaying the moving of the support staff to renovate that space for classrooms. She thought there were some renovations that were independent of adding classroom space. Commissioner Halkiotis said that it has always been the intention to increase the population of Hillsborough Elementary School by 100 students, with renovations to the bathrooms and ramps for handicapped accessibility. He said that it has also been mentioned to move Support Services to another place (i.e., Orange High School). Chair Jacobs asked about the possibility of phasing in the renovations with $450,000 allocated this year and the other $450,000 next fiscal year and suggested that the County Manager and the Superintendent discuss this possibility. Commissioner Gordon feels that the expansion for 100 students could be postponed because the Elementary School enrollment in Orange County schools has dropped and there are 800-900 vacant classroom spaces. She would like to delay the Support Services renovation and the displacing of 38 people and the building of the Central Office addition. John Link suggested that since this is all alternative financing, that the Board leave $650,000 in the budget this year and carry over the $1 million to 2003-04. Rod Visser asked and Finance Director Ken Chavious said that the plan is to use the High School for security for the alternative financing for 2002-03. The following year they could use the administrative building as security for the financing. Ken Chavious feels that the plan is doable. Commissioner Carey suggested talking with the superintendent before finalizing the above plan. He agreed with moving the $1 million forward to 2003-04. He would like to ask the superintendent what his plan would be for phasing and what happens to the 38 people. He would like this information by the next meeting. Commissioner Brawn said that she felt the County Commissioners supported the Hillsborough Elementary School expansion. She does not understand why it is dependent upon the renovation of the administration building, which is a much lower priority. Commissioner Halkiotis said that there are 38 support staff people at Hillsborough Elementary School who need to be placed at another location because that space would be used for classrooms to accommodate 100 additional students. Commissioner Gordon made reference to the $1.65 million for expansion of the Central office and said that she felt that this was not a high priority and that the entire project could be deferred instead of deferring one half one year and one half the next year. John Link said that the County Commissioners must adopt project ordinances before any project will go forward. These can be delayed or moved forward as the Board wishes. Tonight the County Commissioners are being asked to approve thresholds for each project. Chair Jacobs said that if the County Commissioners are okay with the plan that has been presented for capital projects, the details could be worked out later. Commissioner Gordon suggested addressing only those projects planned for fiscal year 2002-03 and to work on future year projects at a work session later this year. She said that there are issues with parks and open space, which have not been resolved. She feels that it is not necessary to work all of this out tonight. She said that she is hesitant to change the financing plan far parks. She is not sure about the ramifications of delaying the band money for some of these parks. She agrees with the allocations as specified for fiscal year 2002-03. Commissioner Halkiotis noted that it would take 20-24 months to build a middle school, 16-20 months for an Elementary School and 24-28 months to build a high school and about one-year for other construction projects including renovations. 3. Adjustments to Individual Capital ProiectAllocations Chair Jacobs read from his handout. He said that he changed it from the last meeting based on conversations outside the meetings. His suggested plan would reduce the Manager's recommended tax increase from 4.5 cents to 3 cents. He said that the County Commissioners must make cuts totaling $805,000 just to match the $3.1 million that the State is withholding. If the County Commissioners want to cut the tax increase, other cuts will need to be made. He listed his suggestions as stated on his handout, "2002-03 Budget Discussion". Commissioner Gordon asked about the need for a generator at the Southern Human Services Center. It was answered that the key thing is that this was identified as a need by those departments housed in the Southern Human Services Center and would be used to take care of medicines and other items that need to be refrigerated. John Link said that if this were something the County Commissioners want to delay, the County would work with the school systems to use their generators in case something happens where electricity is lost far an extended period of time. There are enough portable generators in the County that could be used. Commissioner Carey asked about the Old Courthouse project and said that he thought that only $25,000 was needed to coincide with the timing of Hillsborough's efforts to make improvements and repairs. Rod Visser said that $50,000 is needed for the brickwork at the Old Courthouse and $25,000 is needed to take care of moisture problems. These two projects really need to be done. Commissioner Carey made reference to the hiring freeze of staff positions and said that he feels we should consider a six month freeze on positions as opposed to four or five months. This would lower the tax increase a little bit and help the citizens in the County. The County Commissioners have already indicated to the County Manager that essential functions must be continued. This gives the County Manager the flexibility he needs to maintain the service levels necessary for Orange County. Commissioner Halkiotis made reference to a meeting with Person County and said that other counties are laying off people. This hiring freeze will guarantee the present County employees their jabs. He agrees with the six-month hiring freeze. Commissioner Gordon asked what the figure would be for a freeze for six months and Personnel Director Elaine Holmes said it would be $740,000. Commissioner Brawn said that she is not sure she is supportive of the $10,000 needed for part-time Aging positions. Jahn Link said that they have asked all County departments to cut temporary personnel monies. He said that he would not know how much of the safety net monies they would need for at least two months. This could be funded from those monies because it is a human service issue. Commissioner Brown asked that the County Commissioners consider raising the subsidy that the County pays for health insurance for employees from 40% to 50°~. No adjustments were made to the individual capital project allocations that were proposed on the two sheets. 4. Potential Hiring Freeze and Other Employee Pay & Benefit Matters Chair Jacobs said that there is a proposal to make the hiring freeze for a period of six months. Also, there is a recommendation to change the 40% health insurance subsidy to 50°~. Commissioner Gordon said that the problem this year is that this is going to cost employees their compensation. It also is a policy change. She wonders if we can keep our policy the same at 40°~ and alleviate the situation this year and have a lump sum of money to hold people harmless. Elaine Holmes said that the impact of the 50% would hold people harmless. John Link said that this could be addressed through a 1-1/4 increase in the in-range salary increase, which would apply to all employees but would diminish the impact of the health insurance increases. John Link stated that there is $145,000 budgeted far meritorious service awards and the cost of the in-range increase is $174,000 so an additional $29,000 would be needed. Commissioner Brown said that the in-range would be fine with her, but she thinks that we need to address the issue of the health insurance because the majority of the people that have dependent coverage make less than $50,000 annually. Ken Chavious said that any time a lump sum is given to a County employee it is taxable, so the employee would not benefit fully from getting a flat amount. Commissioner Carey suggested increasing the County's subsidy for one year, which will hold harmless any increase in the health care cost. Chair Jacobs said that there is $145,000 in the budget far meritorious pay. This can be used for other options including increasing the subsidy the County pays for health care costs. Commissioner Halkiotis said that the 1$% health care costs increase is an estimate. Last year, the County budgeted far 15% and it was 8%. Elaine Holmes said that based on conversations she has had with the health care providers she would not decrease this 18%. John Link suggested that the County Commissioners put an amount of money in the budget for pay and benefits and further discuss this in the fall since the health care increase will not be effective until January 1, 2003. Commissioner Gordon said that she would rather wait and make a decision later in the year on pay and benefits. Chair Jacobs said that there will be a work session in October and this could be discussed at that time and we can finalize how we want to apply this $145,000. Commissioner Brown asked if acost-af-living increase could be discussed in October also and Commissioner Gordon indicated that acost-of-living would not be possible this year because of the cost. John Link said that depending on the revenue picture in October, the Board could, at that time, consider whatever they want regarding pay and benefits. The Board can do a budget amendment at that time. Chair Jacobs said that once we see what the legislature has done and see if other revenue streams are available, the County Commissioners could then put in priority order what they want to address with additional revenues. Commissioner Halkiotis made reference to the subsidy in insurance casts and said that he supports doing something for County employees in this area. There was a general consensus of the Board that the insurance issue would be addressed first in the fall. There was a consensus for asix-month hiring freeze. Chair Jacobs asked about the three changes that he proposed -putting money back in the affordable housing trust fund to help cover the urgent home repair program, increasing the reserve to cover State human services cuts, and restoring part-time Aging positions. The Board agreed with the first two, and agreed to address the Aging positions in the realm of all the temporary positions. John Link said that there are going to be many cuts at the State level. A priority list will need to be developed for County monies available for outside agencies. Many outside agencies have had their budgets cut also at the State level. He said that some of the cuts would be made to Smart Start, childcare subsidies, Criminal Juvenile Justice programs, health, and DSS. These will need to be addressed first. Commissioner Brown feels we need to be all encompassing when we look at the programs that have had or may have their budget allocation cut by the state. Jahn Link said that he talked with Tom Maynard from O-P-C Mental Health who indicated that so far they are going to be able to absorb the cuts from the State. However, if there are other cuts, he may not be able to absorb all of them. BREAK 9:00 - 9:15 6. ReviewlAdapt "Resolution of Intent to Adopt 2002-03 Orange County Budget Ordinance" Rod Visser said that, based on the changes that the Board has discussed tonight, there have been reductions totaling $4.7 million - $3.1 million is to make up for the anticipated State reimbursement loss. About $1.6 million is from a combination of individual capital project allocation changes or cuts and asix-month hiring freeze. This lowers the tax increase to three cents. Chair Jacobs said that another option would be to make further cuts to bring it down to a 2.5-cent increase. This would require a cut of an additional $250,000. Commissioner Carey asked that the County Manager figure out the additional cuts. Commissioner Gordon questioned whether the County Commissioners really want to do that. She verified that the tax increase would be 2.75 cents with the extra $220,000. She said that the voters have already approved atwo-cent tax increase with the passing of the bond. Chair Jacobs said that one other tax decrease that we should mention each time we have this discussion is that far 213 of the population in the County, the district tax is reduced by an additional one cent for those in the Chapel Hill-Carrboro City School district. Commissioner Carey and Commissioner Halkiotis said that they support bringing the tax increase down to 2.5 cents and asked that the County Manager come back with a recommendation of how to do this. John Link said that he would like to see the Board adopt the Resolution of Intent with the 2.5-cent increase. He said that the additional $240,000 needed could be addressed with some of the unanticipated revenue. A motion was made by Commissioner Carey, seconded by Commissioner Halkiotis to set the tax increase at 2-112 cents. VOTE: UNANIMOUS A motion was made by Commissioner Carey, seconded by Commissioner Halkiotis to establish the per pupil amount for the schools at $2,516. VOTE: UNANIMOUS A motion was made by Commissioner Brown, seconded by Commissioner Halkiotis to set the Chapel Hill-Carrboro City Schools district tax rate at 19.2 cents. VOTE: UNANIMOUS 5. County Operatina Budaet Matters Fire District Tax Rates Rod Visser said that for 11 out of the 12 fire districts, the tax would stay the same. We have a 20-year contract with the Town of Chapel Hill to provide services to South Orange. There is a .65-cent tax increase needed far this fire district to meet the contractual obligation. This would bring that fire district tax to 8.5 cents. The annexation of Southern Village occurred last year and the tax collected from that area needs to be made up in same way. A motion was made by Commissioner Halkiotis, seconded by Commissioner Carey to approve the .65-cent tax increase for South Orange Fire District. VOTE: UNANIMOUS The staff will bring the capital project ordinances on Thursday evening. In answer to a question from Commissioner Halkiotis about how the County would fund an increase in salary for teachers if the State makes that recommendation, John Link said that the County Commissioners could reconsider their action to the tax rate itself. He feels that the General Assembly will address the'/ cent sales tax. One course of action would be to address this issue as the revenue becomes available because the Board has to respond on a per-pupil basis. Rod Visser said that when County staff met with the Superintendents in May, there was already an idea that there might be a proposal for something like this out there. It may be that one or both school systems have started thinking about how they would try to absorb it. Chair Jacobs said that if the '/ cent sales tax comes back to the County, that 1/3 of this ~/ cent will go to the schools for capital projects but it could be used for other items. John Link made reference to the APS contract and said that Health Director Rosemary Summers would not be able to attend the meeting on the 27`" when this item is on the agenda. Rosemary Summers said that the APS contract this year is about an $8,000 increase. Commissioner Brown said that her concern is the regular stories that come to her about animals that are brought into the shelter, which have ownership and the owners are not notified. Also, other things that happen that may be due to having volunteers and she was wondering what the APS could do to be sure that the animals that have owners are returned. Rosemary Summers said that she would address Commissioner Brown's concern with the new APS Director. The Director is new and she has noticed improved staff morale with a much better continuity this year. There will always be situations, but there can always be improvement. Commissioner Brown said that it not only reflects on haw citizens feel about the County but also how citizens feel about the APS. There seems to be too many mistakes made. Chair Jacobs said that there have been extended discussions with the APS. The APS has talked about doing some type of customer survey and they have raised the pay of the workers at the shelter. Presumably, the new director will look at how they do things. He asked Rosemary Summers if she was going to wait and see how this works out before talking about whether or not it would be reasonable to survey customers. Rosemary Summers said that there was going to be a joint process for planning a new shelter and what customers want in terms of services. APS has done a good job communicating with the Health Department. Commissioner Brown is not sure why the APS would want to wait to do a customer satisfaction survey. She said that the survey could be mailed to those people who have used the facility. Rosemary Summers said that she could suggest this to the APS. Commissioner Brown asked if this could be incorporated in their contract. John Link suggested that a letter be sent from the Chair to communicate the expectations of the County Commissioners. Chair Jacobs made reference to a green memo in the packet, which provided information about the impact of the Schools Adequate Public Facilities Ordinance on the impact fees. The memo addresses what the difference in revenues might be if we had the same real estate transfer tax as seven other counties have instead of the impact fee. Chair Jacobs made reference to the agenda for Thursday evening. He said that we could decide tonight to begin that meeting at an earlier time if the County Commissioners do not feel that we can finish the agenda that evening. The Board decided that they would try to complete the agenda beginning at 7:30 p.m. ADJOURNMENT With no further items for the County Commissioners to consider, a motion was made by Commissioner Carey, seconded by Commissioner Halkiotis to adjourn the meeting at 9:55 p.m. VOTE: UNANIMOUS The next meeting will be held at 7:30 p.m. at the Southern Human Services Center on June 27, 2002. Barry Jacobs, Chair Beverly A. Blythe