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HomeMy WebLinkAboutMinutes - 20050414APPROVED 511 712 0 0 5 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS WORK SESSION April 14, 2005 7:30 p.m. The Orange County Board of Commissioners met for a work session on Thursday, April 14, 2005 at 7:30 p.m. at the Southern Human Services Center in Chapel Hill, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Mases Carey, Jr. and Commissioners Valerie P. Foushee, Alice M. Gordon, Steve Halkiotis, and Barry Jacobs COUNTY COMMISSIONERS ABSENT: COUNTY ATTORNEY PRESENT: Geoffrey Gledhill and S. Sean Borhanian COUNTY STAFF PRESENT: County Manager John M. Link, Jr., Assistant County Manager Gwen Harvey and Clerk to the Board Donna S. Baker (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. 7:37:45 PM 1. Baseline Funding for County Capital Priorities a. Pay-As-You-Go Funding John Link said that this item is intended to give the County Commissioners an initial perspective on how to address the County's capital needs over the next ten years. It is not the formal presentation of the CIP. Budget Director Donna Dean made a PowerPoint presentation as shown below. County Capital Priorities and Capital Funding Options Orange County, North Carolina April 14, 2©Q5 Tonight's Discussion ^ County Capital Needs and Funding Discussions To-Date . Directions from Board . Recurring County Capital Needs . New County Facility Needs . Pay-As-You-Go Capital Funding Options ^ Manager's Recommended County Pay-As-You-Go Capital Priorities and Baseline Funding ^ Manager's Recommendation for Re-Allocation of $12.8 Million from CHCCS Elementary #10 to Other School and County Priority Projects ^ Proposed Projects to Fund with 2004 Two-Thirds Net Debt Bonds ^ Next Steps Directions from Commissioners ^ Simplify current capital funding policy ^ Provide additional resources for ^ Repair, maintenance and upkeep of existing County facilities ^ Additional County space and facilities ^ Funding target of 60 percent of capital expenditures for school projects and 40 percent for county projects Recurring County Capital Needs ^ Current facility maintenance, repairs and improvement needs ^ Almost $18 million identified needs in County Facilities Needs Report presented on March 24 ^ Additional recurring needs ^ Replacement vehicles and major equipmentlmachinery ^ Information Technology equipment and infrastructure New County Facility Needs Additional County space needs identified in 2005 Space Needs Update . Over $40 million identified "new space" needs through 2020 . Land Services Building ($11.2 million) . Animal Services B wilding ($5 million) . Library ($ 9 9 million) . Southern Human Services Center (including Dental Clinic) ($5 million) . 919 Center ($3.2 million) . Public Works/OPT Facility ($989, 000) . Motor Pool Expansion ($750, 000) . Whiffed Human Services Center ($ 9.9 million) . Administration Building ($7.2 million) . Identified up-fits and renovations of existing space related to space study have additional costs Pay-As-Yau-Go Capital Funding Options ^ Presented at March 31St Budget Work Session ^ Further Board Review/Discussion Scheduled far April 20t" Work Session ^ Further Commissioner/School Board Review/Discussion Scheduled for April 26t" Joint Work Session Baseline Option (Current County Capital Funding Policy] ^ Cedar Ridge High School Debt remains with OCS ^ Recurring Capital . 3 cents on property tax rate dedicated for School projects . 1 cent on property tax rate dedicated far County projects ^ Complicated formula involving numerous revenue streams Funding Options 1 Through 4 ^ Offer various scenarios of allocations long-range and recurring capital between School and County projects ^ Scheduled for further discussion at the April 20 Budget Work Session and April 26 Joint Meeting with the School Boards Manager°s Recommended County Pay-As-You-Go Capital Priorities ^ Prior commitments (for example new Orange Enterprises) ^ Preservation of historical structures ^ Sustainability of existing facilities ^ Mandates and safety ^ Equipment and vehicle replacements ^ Technology infrastructure and equipment ^ Reserves for emergency repairs Set Aside for Future County Facilities ^ No funding available in Baseline Option . Included in Options 1 through 4 ^ Sets aside future pay-as-you-go funding to repay debt service not already programmed in the County's Debt Issuance Schedule . Sportsplex . New Courthouse Renovations related to construction of New Justice Facility . Identified in 2005 Space Study Update . Animal Services Facility, Land Services Building, Library, Southern Human Services Center (including new Dental Clinic}, 911 Center, Public WorkslOPT Facility, Motor Paal Facility "Set Aside" Offers Mast Conservative Approach . Offers the "worst case" approach by assuming that debt service related to future County projects would not be offset by property tax increase . On the other hand, the Board may decide in the future that the debt service associated with some or all new County projects would be offset by property tax increase . That decision would "free up" additional pay-as-you-go funds for County recurring capital ^ As a point of reference, the Board decided to increase property taxes to cover the increased debt service related to the 2001 Bond and Alternative Financing Plan for County and School projects Manager's Recommendation for Re-Allocation of $12.8 Million from CHCCS Elementary #10 to Other School and County Priority Protects OCS Middle School #3 $3,500,000 CHCCS High School #3 $3,800,000 CHCCS Elementary #1 o Planning $500,000 OCS Middle School #3lWest Ten Soccer Complex {water lines} $500,000 New Senior Centers $2,000,000 New Animal Services Building {Land and design) $700,000 New County Campus (land and master site plan} $1,800,000 $12,800,000 Proposed Projects to Fund with 2004 Two-Thirds Net Debt Bonds - $4.2 million available (charts incorporated by reference in PowerPoint handout) Next Steps For Capital Fundina Options and Capital Investment Plan April 20th Budget Work Session Further Board discussion of proposed Capital Funding Options April 26t" Joint Meeting with School Boards . Opportunity for all Boards to have dialogue regarding the various Capital Funding Options May 3`d Regular Commissioners Meeting Possible decision on Capital Funding Options June 7t" Regular Meeting or June 9t" BudgetlCapital Investment Plan (CIP} Work Session Presentation of Schools and County CIPs June 14t" or 16t" Budget/CIP Work Session Further discussion of CIPs June 23`d Regular Commissioner Meeting Board Approval of Schools and County CIPs Chair Carey said that it is up to the Board of County Commissioners to decide which direction to go with the options, as well as the 213 net debt and the allocation of the $12.8 million. He said that the school systems are waiting for the Board to make decisions about the capital options so that they may develop their CI P's. Commissioner Halkiotis made reference to page four of the hand out, Baseline Option (Current County Capital Funding Policy}, and asked if the County Commissioners have religiously over the years appropriated three cents for school projects. Donna Dean said that in the past few years it has been about two cents. Commissioner Halkiotis asked if the proposal was to go back to three cents and one cent for County projects and it was answered yes. Commissioner Halkiotis would like to make a commitment to the County's recurring capital because there are buildings that are falling apart, such as the new courthouse. He made reference to page five and Reserves for Emergency Repairs and asked for same examples. Donna Dean said that the most recent was that the water heater in the jail went out. It cost over $20,000 to replace. Commissioner Halkiotis thinks there should be a specific pot of money dedicated for emergencies. Commissioner Halkiotis made reference to the statement on page six, "That decision would `free up' additional pay-as-you-go funds for County recurring capital." He gets the feeling that they are looking to capture a little money here and there. He thinks there should be a decision that the County will have a recurring capital fund and be consistent with it. Commissioner Halkiotis made reference to the OCS Middle School #3 water lines and asked about the final decision with Mebane regarding future tap-ons going to Mebane and nothing coming to the County. Commissioner Jacobs said that it was brought up with Mebane and the decision was as Commissioner Halkiotis stated. Commissioner Halkiotis said that it is unfair that schools and County government are paying for lines that they cannot recoup their original costs from future users. He encouraged getting something in writing from Mebane. Commissioner Gordon asked about the strategy to make these decisions. She said that last time we discussed this, she had asked Donna Dean to provide the assumptions the staff used in each of the options but we have not received this information. She said that the underlying questions brought up at the last meeting have not been addressed. She would like information on the school systems' list of projects with the costs included. She is concerned about the massive nature of the backlog an the County projects. She also wants to work an funding equity for the schools. She feels uncomfortable about taking scarce resources ($12.8 million and $4.2 million} and saying definitively what is going to be done because she does not think the Commissioners are seeing the whole picture. Chair Carey said that at the previous meeting, the staff did distribute a list of assumptions far the options. The Board did not have a chance to discuss them. He suggested discussing those first on April 2Qth. There are some significant assumptions included, but it should not deter the Board from making a decision on one of the options. Chair Carey said that he thought that when they talked about County space needs that the Board asked the staff to begin work on identifying the central county campus. He thought the staff should be working on this already. Commissioner Halkiotis agreed and said that they asked bath school systems and the Manager for breakdowns for particular capital improvements, including the costs. John Link made reference to the baseline and options 1-4, and said that the numbers are pretty solid in the first year or two. He made reference to page 4 of 26 in the abstract and said that this is where the money comes from to address debt service. The assumption is that these buildings will not be on a bond, and the best way to fund them is through tax increases. He thinks this is a major policy decision. He agreed with Commissioner Gordon in that there needs to be a rationale far haw to wisely appropriate funds; reallocation of $12.8 million and the 213 net debt funding are major funding decisions. He made recommendations based on what is imminent and what needs to be addressed over the next couple of years, which are years when we have reached our debt ceiling. Commissioner Foushee said that it appears to her that staff has shown commitment to having a recurring capital budget. She made reference to the options for an emergency reserve fund and said that they should not reserve any less than $5Q,000/year. She made reference to attachment 1-b, which is the option she prefers, and asked why they would start out with $50,000 for each of the first four years and then increase to $1 QQ,QQQ for four years, and then drops back to $SQ,QQQ. She would like to know the assumptions for this. She asked about the funds that would address roofing and HVAC repairs and if they are based on scheduled maintenance, and if so, why they would change under each option. Wilbert McAdoo said that they have a schedule and it is adjusted based on funding availability. They meet their highest priorities first and they can delay some things. Commissioner Foushee said that in some cases they are prolonging the inevitable, which costs more down the road. Donna Dean made reference to the reserve for emergency repairs and said that they were hoping that as they build up the reserve, they are also taking care of the needs, as they exist. Once the contingency is built up, they will not need as much in future years if they are starting to address recurring capital. Commissioner Jacobs asked for an update on the Homestead House. Donna Dean will follow upon this. Commissioner Jacobs thought this was going to be renovated. Commissioner Jacobs noted that one of the recommendations of the Library Task Force was a library in Carrboro. There needs to be a decision on this. Commissioner Jacobs made reference to line 19, Water Demand Reduction Systems and Equipment, and said that he does not understand why they could not just frontload the $1 QQ,QQQ instead of paying for it over ten years. Commissioner Jacobs said that in looking at all of the projects, it has been about 2 ~l years since they talked about an environmental ethic for how County government operates and there has been no progress. He suggested having someone from the outside to come in and look at the County's buildings before they spend money an renovations to get same guidance. Commissioner Jacobs said that if the legislature were serious about a lottery that provides money far school capital construction, he would like to see same recent figures about what might be available, because it will affect this scenario. Commissioner Jacobs made reference to Mebane and said that there is a letter from Ed Kerwin suggesting that in the North Carolina General Statutes, towns and counties have the authority to recover line extension costs through the adoption of special assessments for water and sewer improvements. He asked the County Attorney to look at this for Twin Creeks and the OCS Middle School #3lWest Ten Soccer Complex project. Geaf Gledhill said that it is probably more doable with OWASA because it would be a willing participant. Commissioner Jacobs asked about money far conservation easements versus Lands Legacy. He is not clear whether money for conservation easements could be used for Lands Legacy but that Lands Legacy band money could not be used for conservation easements. He made reference to line 28 and suggested putting this $100,000 towards conservation easements since there is $3 million set aside for Lands Legacy. Commissioner Halkiotis said that he is curious about the painting proposals over a period of ten years. He thinks the schedule should be every three or four years because the paint an historic buildings flakes off so easily. Commissioner Halkiotis would like to see a copy of the strategic plan for HVAC replacements. Commissioner Halkiotis said that he is worried about identity theft. He said that $5.5 million over the next ten years is a lot of money to be throwing into what he thinks is a dying technology business because security cannot be maintained. Chair Carey asked the Manager if all of the projects included on the two lists were things that he projects will have to be financed within the next two years before there is any increase in the debt ceiling. John Link said yes. John Link said all of the debt capacity the County has far the next two years is embodied in these sheets, which totals $15.6 million. Chair Carey said that the first order of business is to flesh out the strategic plans for each of the major categories and make sure nothing is missing. Commissioner Gordon asked haw the water and sewer lines to the Twin Creeks site would be funded. Rod Visser said that there is not an answer to this yet. Chair Carey suggested proceeding with decisions because it is unsure when the lottery might be passed. He encouraged the staff to see what might become available. The plan can always be revised if the lottery is passed. John Link said that the staff sees as the next step that the Board would make a decision on which funding option to pursue. He would not propose that the staff create another set of projections until the Board makes a decision. The final CIP would reflect what the Board wishes to be included. Commissioner Jacobs said that he would like to see an option where half of the Cedar Ridge debt is removed. Commissioner Gordon said that the challenge for Cedar Ridge is that there is not enough money for renovations and maintenance. There may be same other way to go about it besides the debt service. She would like the staff to look into ways to give the OCS more renovation money without changing the debt service. Commissioner Halkiotis said that he is worried this year mare than any other year because he received a memo from Superintendent Neil Pedersen and he does not recall seeing this kind of listing of potential reductions since he has been on the Board of County Commissioners. He said that there is a possibility that discretionary reductions of approximately $570,000 are going to disappear. There is also talk of additional 4°~ reductions in the K-12 budget. He would hope that if the school systems are getting this information from Raleigh, that the Manager and staff are getting this information. He asked that prior to the meeting with the school boards next week, that the staff prepare a historical narrative to explain to new school board members on the OCS school board on Cedar Ridge. He said that the bonds that help build Cedar Ridge were not even approved by the voters of the Orange County school district. Chair Carey commended the staff for an admirable job. 2. Twin Creeks Master Plan Work Group Report Environment and Resource Conservation Director Dave Stancil gave this report. He said that the work group had two very productive meetings. The four tasks of the work group were as follows: - Look at relocating/redesigning the proposed Elementary School #10 to the southeastern portion of the site (east of Jones Creek currently shown as "Future Educational Facility"} - Keep the four soccer fields configuration intact in the redesign - Consider locations for action sports facilitylactivities in the park - Look at the feasibility of relocating the "stadium field" to the south with the park He summarized the findings of the work group. He said that the group looked at relocating the stadium, but noted that there are a lot of synergies related to the middle school. There was also a great deal of topography and stream buffers that would have to be dealt with if it were relocated. The work group decided to keep the stadium where it was originally planned. The work group proposed a 1/3-mile loop trail around the meadow as an alternative to meet the needs for a measured walking or running trail. Regarding the action sports, there is a possibility of working with Piedmont EMC within their power line easement that might be able to serve as a BMX bike facility. Regarding the passible relocation of Elementary School #10, the work group felt that there were more benefits to having a middle school and elementary school together for the idea of shared supervision, food service sharing, and other possibilities. Regarding the next steps, there is a timetable included in the abstract. The staff would like to bring same tweaks to the plan at a subsequent meeting. The Board could still adopt the plan and the staff could bring the tweaks later. Chair Carey pointed out that the last two pages of the abstract were suggested by Planning Board member Jay Bryan, who was on the original group that worked on the concept plan. Commissioner Halkiotis made reference to recommendations #5 and #6 on page 8: "Allow the Planning Board to have its Chair and Vice-Chair, or proxy, have notice af, attend, and participate in all negotiations with the Town of Carrboro regarding the development of the Park Site; and Allow the Planning Board to review all construction drawings far the Park before submittal to and review by the Board of Commissioners." He asked about the purpose of this. Chair Carey said that he put these recommendations in because he told Jay Bryan that public input would be limited at the work group meetings. Commissioner Halkiotis objected to recommendations #5 and #6. He thinks it is micro-management. Commissioner Foushee agreed with Commissioner Halkiotis that it is time to move forward. Commissioner Gordon said that one of the major things that is different is the action sports facility. There were same questions such as liability, access, etc. She would be inclined to make it less definite for now as compared with projects already endorsed. Commissioner Jacobs asked if this would be brought back at a regular meeting to adopt. Chair Carey said that it would be brought back at the first possible regular meeting. Commissioner Jacobs would like to find out if Piedmont Electric would allow the action sports facility. He is supportive of the action sports facility. He would like to see staff tweak this part of the plan. Commissioner Jacobs made reference to Jay Bryan's recommendations and said that he would like the staff to go through them and tell the Board which ones they recommend. Commissioner Jacobs noted that the sign is falling down that says "Future Site of a Park." He also finds it curious that there is always something that trumps walkability. Commissioner Halkiatis said that he does not believe Piedmont Electric will allow anything in their easement, and he does not think it is a good idea to allow these activities under the power lines. He is committed to the action sports facility, however. He hopes that space can be found for it. Commissioner Gordon would like to address when the water and sewer lines are going to be put in and where the money is going to come from. She asked if the Soccer Superfund would be used for this facility. 3. Discussion of Educational Excellence Work Group Report Rod Visser said that on March 15t , Dr. Madeline Grumet and her team of researchers reported to the Board of County Commissioners the findings and recommendations related to the work of the Educational Excellence Work Group. The Board of County Commissioners did not have much time to discuss the report at that time, but asked Dr. Grumet to try and make herself available to each of the two school boards sa that they could hear the full presentation. Dr. Grumet has already met with CHCCS and is scheduled to meet with OCS an April 25tH Commissioner Halkiotis said that he is concerned about the challenge with this budget season. He is really worried because the County Attorney said that if the County does something for one system it has to do it for the other system. He thinks the word "merger" needs to be said again. He thinks the Manager needs to take some of the staff, the "think tank", and go away for a couple of days and brainstorm all of the possibilities. The County has a multitude of other responsibilities besides the school systems. He thinks this will be the most challenging budget year that he has faced since he has been an the Board in 18 years. He hopes that the Manager will be bringing a menu of possibilities with the pros and cons. Commissioner Gordon said that it is all going to come down to money no matter how it is done. She is also worried about this year. She still thinks that if there are more resources to the OCS, then it means that taxes will have to be raised in the OCS. She does not think there should be a merger at this time. Either way, the funding has to be adjusted. She would like to define equity and do something at least this calendar year. Chair Carey said that the reason the Board has this report is because it tabled discussions about funding equity and merger until this report was available. He would like to put the issue back on the table of the implications of equity and what anticipated capital savings there would be if there was a merger. He thinks it is incumbent upon the Board to pick up the discussion that was tabled last year when all of the information is available, including the information from Bob Segal. He thinks the Board will be forced to make some decisions about the funding issue before it has this in-depth discussion. Commissioner Jacobs said that the County has a strategic plan for Recreation and Parks, but it does not have a strategic plan for how to equitably fund the schools. He thinks it is a priority. He made reference to Superintendent Pedersen's memo and said that, although he supports the concept of equity, he is waiting to see how thick the ice is before he is willing to jump up and dawn. Commissioner Halkiotis made reference to the lottery and said that they should not predicate any decisions on whether or not it will come to fruition. He said that what worries him the most is the sense that, while they are trying to bring one school system up, the other school system will start losing things if it is loses money from Raleigh. He does Hat want to see the CHCCS hurt, but he wants to see the OCS helped, and that is why he wants to see every possible option. Chair Carey said that the next steps are to get the report from Segal and schedule another work session after the budget is adapted. Commissioner Foushee said that, in terms of the staff ascertaining from the State level what projected budget cuts are coming to education, she has seen enough information indicating that many of the items that Superintendent Pedersen addressed in his memo are on the chopping block. The Board needs to be clear on what the deficits are. She would like to add this to the list of items that comes back to the Board, along with the other options for the budget. John Link said that the staff hopes to be able to start sharing ideas with the Board next week, although it will not be a total package. John Link said that the driving forces of this budget are the pay plan, education, debt service, and Medicaid. Chair Carey said that he thinks that all are concerned about equity, but he does not think the Board needs to wait until it defines equity to get started an trying to address it. Addressing equity will be a long-term process. Commissioner Foushee said that they could get started on providing additional resources, but she does not think the Board can get started on addressing equity until it understands what it is to be addressed. Commissioner Halkiotis said that whatever the Manager comes up with, he would request that the County Attorney review it. He does not want to waste a lot of time. Commissioner Jacobs said that, to some extent, if there is a strategic plan it will have to be after the State adopts its budget, which is after the County adopts its budget. He thinks everyone is in agreement that the lack of equity is glaring. He thinks the Board needs to make some movement. 4. Discussion of Next Steps Related to 60-40 Capital Funding Policy Rod Visser said that this would be brought back as the first item on April 20tH With no further items to address, a motion was made by Commissioner Halkiotis, seconded by Commissioner Gordon to adjourn the meeting at 10:00 p.m. VOTE: UNANIMOUS Moses Carey, Jr., Chair Donna S. Baker Clerk to the Board