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HomeMy WebLinkAboutMinutes - 20060216APPROVED 4/18/2006 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS WORK SESSION February 16, 2006 4:00 p.m. The Orange County Board of Commissioners met for a Work Session on Thursday, February 16, 20Q6 at 4:00 p.m. at the Southern Human Services Center in Chapel Hill, N.C. COUNTY COMMISSIONERS PRESENT: Chair Barry Jacobs and Commissioners Moses Carey, Jr., Valerie P. Foushee, Alice Gordon, and Stephen Halkiotis COUNTY ATTORNEYS PRESENT: Geoffrey Gledhill COUNTY STAFF PRESENT: County Manager John M. Link, Jr., Assistant Managers Rod Visser and 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. 1. Continuation of Discussion Regarding School Equity Considerations Chair Jacobs said that this is a continuation of the discussion began at the retreat on January 20t". The County Commissioners stated that they wanted to try and move as expeditiously as possible to discuss what is meant by school equity and how to better address the issues raised by school equity. They also said that they would try and schedule extra meetings if necessary to do it, and this is one of the extra meetings that was scheduled to have mare of an opportunity to discuss school equity. There is another work session on March 13t", and this can also be discussed at that time. He suggested seeing where they get tonight in the time allotted and determine how much more time is needed to come to a satisfactory resolution of what is meant by school equity and how to address it. The Board agreed. John Link said that the three questions on the abstract are good because the Board has deliberated the fiscal side of equity and chose not to pursue merger at this time. The voters of OCS voted against the district tax and now they are left with looking at the fiscal side equity by using property tax, other funds, or lottery money. He said that there may be opportunities to provide funds to schools outside of per-pupil such as contracts via County departments for social workers, nurses, SRO's, etc. Chair Jacobs said that they received a letter from the CHCCS board that said that they did not have time to respond to equity questions at this time, but that they will give a written response soon. OCS Superintendent Shirley Carraway said that they received the letter and their board has not had an opportunity to meet yet to address the questions. Question #1: What is your definition of equity? Commissioner Gordon distributed handouts from Chair Jacobs, Commissioner Gordon, and Commissioner Foushee. Commissioner Carey said that he did not write his responses to the school equity questions because he was on vacation. He would like to verbally give his responses. Commissioner Halkiotis said that he has no excuse but he knows what to say. Commissioner Gordon reviewed the first question of her handout as shown below. SCHOOL FUNDING EQUITY Alice Gordon -February 14, 2006 Answers to Two Questions Posed During the Commissioners Retreat in January 2006 WHAT IS YOUR DEFINITION OF EQUITY? A. Definition School funding "equity" means "fairness" in school funding. Source of definition: According to Webster's dictionary, one of the definitions of equity is "freedom from bias ar favoritism" or "something that is equitable." The synonym of equitable is "fair." B. Process The county and the two school boards should work as partners to develop an agreement for fairly funding bath operating expenses and capital expenditures in the two school districts. All three boards have statutory responsibilities for schools, so it is important to work together. (1) Operating Expenses. The cooperative agreement should include fair funding of programs and services in both districts. This agreement would involve consensus an the method and level of funding, and the time period aver which the agreement would be implemented. In December 2003 I crafted a proposal far addressing the differences in school funding which provided more operating funds for the Orange County Schools. Though this proposal was not adopted and subsequent events have moved us beyond this particular proposal, it is illustrative of the sort of solution an which we might agree. (2) Capital Expenditures. The agreement should also include fair funding of needed school buildings and other facilities. (a} New Facilities: SAPFO. For new buildings, that means that we will continue to follow the Schools Adequate Public Facilities Ordinance, so that new schools will be built when needed and thus eliminate future school overcrowding in both districts. {b} Older Facilities: Substantial Equivalency. For alder school buildings, it means that the commissioners and the school boards should develop a policy of "substantial equivalency," so that all school facilities are substantially equivalent to each other throughout the county. We have standards for new schools. What we need to have in the future is a systematic plan to maintain and renovate the older schools. There is a gap between the newer schools built within the last 10-15 years, and the schools built about 20 years earlier. We need a systematic program to work on the needs, including health and safety needs, of the older schools in both districts. Therefore we should have a program to upgrade the older schools until they are substantially equivalent to the newer ones, to the extent that is possible. As a practical matter, it will not be possible to make all schools the same. But if new schools have facilities that exceed that which is available at other schools, some compensating facilities that are similar or equivalent should be built at the other schools. At the very least, each school community should identify the facility that they can demonstrate is most needed at their school, and then every effort should be made to provide that facility. Cammissianer Foushee said that, coming from serving in a schoal district, she was keenly aware of the inequitable situations that exist within a particular school district. She thinks that equity should include: • equal access to opportunities or choices • equal access to comparable courses • equal process (everyone is included in or allowed to contribute to the decision- making). She said that some families do not have access to the process. Chair Jacobs read from his handout for the first question as stated below. WHAT IS SCHOOL EQUITY? Equity in this context is an equal opportunity to receive a quality public education. While that may not necessarily equate to identical funding, it does equate to identical treatment on the part of county government, to equal access to the decision-making process, and to comparable access to services, programs, and facilities. This is the spirit in which school collaboration was undertaken and continues, in which the middle college was established, in which a middle school league was fashioned, in which a joint college fair was held by the two school districts, and in which some school staff development has been shared. This is the spirit in which Orange County provides a strong basic framework for all students, with the top per-pupil and capital funding mix in North Carolina. Chair Jacobs said that he thinks that if they get past focusing an equal funding, then they can make a lot of progress. Commissioner Carey said that he has been consistent about his perception of equity. He thinks that his concerns about equity are similar to his responsibility as a County Commissioner, that every child in the County, regardless of where they live, should have the same opportunity to reach their full educational potential. He thinks that an element of this is access to options that are available to everyone. When you talk about fairness and access, you are really talking about money. He thinks that access does not necessarily mean equal since each school board will have to make decisions about priorities. Commissioner Carey said that, in answer to the second question, he has consistently had reservations and real concerns about funding anything outside the per- pupil allocation because it gives the public a false sense that the County Commissioners have more line item control than they really do over school budgets. He does not want to mislead the public. He thinks that this is a slippery slope. Commissioner Halkiotis said that what the County Commissioners have all said is true -take the words equal, access, level playing field, and opportunity, and broaden it to be wide enough so that every child can walk through. He worked for a school system for 32 years where principals made less money than their colleagues in the southern end of the County, but he never heard anyone complaining except at the elected level. Most other staff people also made less money. He is afraid that today the argument has gone beyond any philosophical boundaries and for most people it has become an issue of money. He thinks that if you want to make it equitable, then legislative authority should be given to both school boards to levy taxes. He said that several years ago, two CHCCS board members pushed for this at the state level. Commissioner Halkiotis said that, with respect to opportunities for kids, this is where all the difference has to come down to. He said that the bottom line is money. To bring in the same amount of money as the CHCCS, there would be an 18-cent tax increase for the OCS district. He does not think this can be done in one year. Chair Jacobs reiterated what he heard about equity: fairness, fair funding, partnerships with school systems, substantial equivalency {upgrading older facilities), equal access to opportunities and/or choices, equal access to comparable courses, equal process that is conclusive, each child should be able to reach their full potential, not realistic to have an 18-cent tax increase, possibility of having school systems present their budgets to the voters, equal treatment, equal access to decision-making, access to services, programs, and facilities. Chair Jacobs suggested putting all of this into a couple of paragraphs, and they would all agree except the part about the school boards having taxing authority. Chair Jacobs asked Commissioner Halkiotis if he was serious about discussing the idea of having the school systems pursue the opportunity to raise their own monies by vote. Commissioner Halkiotis said that he thinks they should discuss this. Commissioner Carey said that he was at a meeting today of the County Commissioners' Association and this issue of school tax was discussed, and there was no support from the NCACC to give taxing authority to school boards. He said that 3$ out of 40 opposed this idea and he was one of the two that thought it should at least be discussed. Commissioner Gordon said that if they want to do something like this in the short term, they need to get answers back from the school boards on their definitions of equity and the second questions. She said that the school boards could make a strong statement for their budgets and propose a tax increase to fund their school systems. Chair Jacobs said that they could add an item about whether the school boards would prefer a system whereby they have the authority. He does not want to take responsibility for any mare of the school board's decisions than they already do. He is not in favor of them doing this without voter approval. He would be interested in seeing if the school boards would be interested in having the authority to take their budgets to the voters for approval. Discussion ensued on haw the school boards would probably never be given taxing authority in North Carolina. Commissioner Carey said that it would be an interesting debate, but it is probably not going anywhere. He does not want to ask the staff to spend any time on it. Commissioner Gordon said that she would like to do something this year and figure out a way to have some movement toward fairness. Commissioner Carey agreed. Commissioner Halkiotis said that there was a story of an 81-year old man in Dare County who got tired of a '/-cent sales tax for beach replenishment, and he found a piece of North Carolina State law that allowed him to call a special referendum, and it was defeated, and the 112-cent sales tax for beach replenishment is gone. He said that he thinks one of the issues with the district tax vote for OCS was that there was no great incentive for the OCS board to go out and support the concept because it would have been extremely painful. He does not think that the County Commissioners would increase the tax rate by 18 cents. He knows that the taxing authority would not pass in the legislature. Chair Jacobs said that they could ask the school boards an additional question, which is, "Would you like to pursue the possibility of having your own taxing authority?" If they say yes, then the Board can have further discussion about what this means, preferably not in this budget cycle. There is a joint meeting in September and they can talk about it then. The Board agreed. Question # 2: What school programming aspects would you be most interested in having funded outside of the per-pupil allocation for school current expense? Commissioner Foushee said that SRO's are funded differently throughout the two districts. She said that in OCS, the Sheriff provides SRO's but the school system still pays for them. She thinks that they should consider the number of SRO's. She said that Carrboro made contact with her and they were funding them with a grant, and now the grant is ending and they will be requesting funding from the district. She suggested a funding source outside the per-pupil allocation for SRO's. With regard to school nurses and social workers, these are already being funded outside the per-pupil and she would like this to stay the same. Commissioner Gordon reviewed her answer to question 2, as shown below. When adding new programs, the commissioners and school boards should collaborate in formulating the best approach to take. The underlying assumption of this question might be that the decision has already been made to pursue more current expense funding outside of the per pupil allocation. I believe that decision can only be made as a result of cooperative discussions involving the commissioners and the two school boards. There should be guidelines on which we agree. If we decide to pursue this method for funding additional programs, then I believe we should utilize the Grumet report as a basic reference document. As indicated above in my answer to the first question, I believe we should consider the funding of facilities as well as the funding of programs when making any decisions concerning the fair funding of the schools. Commissioner Gordon said that she would like to formally request information on what is already being done outside the per-pupil in terms of funding programs. Chair Jacobs said that if they do identify areas where they want to pursue further information, they will ask as a Board to get everything of interest. Commissioner Gordon said that she would like to know who paid for the school nurses far each school system and the total amount spent far school nurses, social workers, and any other positions. Commissioner Halkiotis would like information on what it would cost to have a nurse at each school site to meet the ratio the State recommends. Commissioner Gordon said that on September 13th, there was information on non-profit agencies providing services to schools, which totaled over $1 million. She wanted updated copies of this. Commissioner Gordon said that she has same misgivings about going outside the per-pupil because it cuts into the school board's authority. She would like to talk with the school boards about it. Commissioner Halkiotis said that the OCS board, many years ago, made a decision to fund nurses out of their own budget. He thinks it is important to Hate that OCS chose to spend more money on nurses. He wants to know what they are actually spending for nurses today. He thinks this is an important piece of the equity argument - if students have equal access to health. Commissioner Gordon stressed that the County Commissioners need to be partners with the school boards and work with them to figure out the best thing to work for everyone. They are all elected officials and it is important to cooperate. Commissioner Carey said that he has been concerned about statutory responsibilities and the line item issues. He said that the Board of County Commissioners has a responsibility to say no to the school systems, since there is a limit to what the Board can fund, and this is dangerous. Commissioner Foushee agreed with Commissioner Gordon in terms of exercising line item veto over the school boards' budgets. She would not want to get into that. She thinks that they can talk about providing additional funding without talking about what the funding is for. Chair Jacobs said that it is clear that they should stay away from instructional or administrative positions, which makes it mare problematic how to respond to the Grumet report. He thinks that they can focus an nurses, SRO's, social workers, and mental health professionals. He thinks that they can establish criteria where there is an educational component and a public health or a public service component. He said that the school collaboration group has discussed this for some time. He said that the Manager's proposal last year for a tiered approach was some attempt to respond to the new paradigm about how to escape the bonds of per-pupil. He thinks that they could contract with positions and they could be fashioned so that it is clear what the expectations are and what the limits are. This is done with nurses at OCS. This is a way to take same of the burden off of the per-pupil and give the school systems more flexibility on how they spend their operating budget. Chair Jacobs mentioned food expenditures and said that, if the County Commissioners get involved, they could promote the County's economy and recycle same of the money within the community by purchasing local produce. Chair Jacobs said that this is a way to address the gap that is created by per- pupilfunding, because it could be scaled. He suggested "buying dawn" the district tax. Commissioner Halkiotis said that it will be interesting when staff pulls together the actual dollar amounts and that they will be surprised what the school systems are spending for these important services. He said that every time the State decides to dump some program, they dump it on the local governments. The latest one was the sales tax reimbursements. He gave credit to the school systems for hiring consultants to research ways to reduce energy casts. He suggested addressing equity by giving the school systems so much money per square foot for utility costs. This creates an incentive to save even mare. He said that bath school systems have to pay for their own activity buses and to fuel them. Both school systems run after-hour programs and non- instructional activities and they have to pay for these. John Link said that one way of addressing the slippery slope is through a contract between the Board of County Commissioners, school boards, and towns, where the entities are willing partners with the SRO's, nurses, social workers, etc. You can contract with support areas outside of instructional areas. Commissioner Gordon said that when you fund instructional expenses, you should use per-pupil money. She thinks that when they ask the school systems, it should say, "What school expenses would you be most interested in having funded?" Commissioner Gordon said that she thinks they need to talk about not just operating, but also capital expenses. She gave an example of last year, when they did the capital funding policy; they cut the CHCCS's capital expenditures by about one cent on the district tax rate The reason the County Commissioners raised the district tax by one cent was to hold the CHCCS harmless. The Commissioners allowed the school board to choose whether they wanted to use the funds for capital ar operating. CHCCS chose to use it for operating. Historically, the Board of County Commissioners has funded per pupil because it is the law, and the district tax keeps giving CHCCS mare funding than the OCS. She thinks that there is an argument that the County has not necessarily funded the CHCCS quite as aggressively on their capital as it has the OCS. She gave an example that every level {elementary, middle, high school) in the OCS will have excess capacity, and this is not true in CHCCS. Commissioner Gordon said that she does not think they should use this mechanism to try and get around the per-pupil allocation. She would rather be straightforward and raise the countywide property tax and cut the district tax. It has to hold CHCCS harmless. She thinks that they should be careful of how they do all of this and maybe keep things easier to agree on, such as nurses. Commissioner Carey agreed with Commissioner Gordon that they should cut through all of this and go right to a formula that reduces the CHCCS district tax without harming CHCCS and increase the general property tax so that the people in the OCS would benefit. He said that all of the projects that were mentioned are attractive to him, but he thinks it is a stopgap measure to get them to move forward. The flaw in the contracting formula assumes that the County Commissioners will only respond to requests from the school boards for adding things to the contracting formula. He does not think that this will work. Chair Jacobs said that they have changed the question as stated by Commissioner Gordon to, "What school expenses would you be most interested in having funded outside of the per pupil allocation far school current expense?" They have also added a question for both school boards as follows: "Are you interested in pursuing a discussion of Orange County School Boards having taxing authority?" He suggested asking staff to put together the minutes of this conversation and forward them to the school boards. He said that the Board could have another discussion after they have heard from the school boards in early March. John Link suggested that this item could be discussed at the April joint meeting. This will be decided at the discussion in March. Commissioner Halkiotis said that the Sheriff's deputy was late in delivering the packet for this meeting. Chair Jacobs asked that all information be ready by February 28tH and this would give time for the school boards to see it. The information includes the minutes, the positions {nurses, SRO's, social workers, etc.} and the source of funding for each of the positions and the total amount of money, utility costs broken down by square foot, and the information about funding to outside agencies that provide services to schools. John Link clarified that the information on the outside agency funding did not specify how much went to schools directly, but the total amount that the County allocated to the agencies. 2. Geof Gledhill said that there is not anything new in the materials. The Board last left this issue on page 3 of the abstract. Chair Jacobs said that the understanding was that if they could complete this discussion tonight that it would go on the March 2"d agenda as a decision item. Commissioner Halkiotis asked Geof Gledhill to briefly highlight proposals 2, 3, and 5 on the map, which he did. The proposals are outlined on page 5 of the abstract. Geof Gledhill said that once the County Commissioners decide on any of the systems, then they will have to get specific about how it works. The specificity would have to be in the resolution. The Board could vote on the system on March 2"d and then vote on the specifics of the resolution later. Chair Jacobs asked far an explanation of haw districts, at-large, nominating, and residential relate to the Voting Rights Act. "Nominating" districts are those in which only the residents of the district vote for the candidate in the primary election; and the candidate must reside in the district. Geof Gledhill said that you could not have two people nominated from D-1 and two people nominated from D-2 because the people living in D-2 would not receive the one person, one vote. The one person, one vote requirement applies when either the nomination is done in the election ar where the general election is done by district. The one person, one vote requirement would not be applicable where the districts were residential only. "Residential" districts are those in which the candidate must reside in the district but all residents of the county vote Commissioner Gordon asked about the deviation of the one person, one vote requirement in each proposal. Proposal 2: District 1 -the permissible range would be 44,000-48,500 to meet the one person, one vote requirement District 2 -the permissible range would be 65,800-72,800 Proposal 3: District 1 and 2 - 27,400-30,300 District 3 - 54,900-60,600 Proposal 5: District 1 - 36,600-40,436 District 2 - 73,169-80,871 Chair Jacobs asked if this would have to be adjusted every census, and Geof Gledhill said that if there is a district system where you are nominating or electing by district, it must be periodically adjusted. If there is a residential district system, there is no statutory authority for adjusting. Commissioner Carey said that he recognizes that the Board may decide to take more than one map to the March 2"d meeting, but he would encourage them to take just one map and to provide the opportunity for public comment at the March 2"d meeting. He said that one decision they need to make is how many County Commissioners they want the new system to include. The second decision is whether to include district nominations or at-large nominations. The third decision is whether to have district elections ar at-large elections. The fourth decision is which of the maps to adopt. And finally, the fifth decision is the applicable date of implementation. He would like to comment on each of these decisions. Discussion ensued on the principles listed on page six of the abstract. The Board agreed to endorse all of the principles an page six -Structure of the Board of County Commissioners' Principles. Commissioner Carey said that his position on these decisions complies with the list of principles. He thinks that it is important to keep the number of Commissioners at five at this time. He said that you can always increase the number of Commissioners but you can never go back to five once you go to seven. He said that five Commissioners have always adequately carried out the business of the County. He said that when it comes to district versus at-large nominations, he prefers district nominations since it most closely resembles the petition that was brought to them last year. He wants to try and achieve some of those goals without compromising any of the principles. He said that at-large election is the option that eliminates the parochialism that he wants to avoid, so he supports at-large election. Regarding the maps, he likes map #5 because it achieves most all of the objectives that he wants to pursue. He said that the applicable date for implementation should be 2008. Commissioner Halkiotis said that he recalls some of the bitterness in the 1980's when he filed to run for County Commissioner. He said that he has not seen this bickering, name-calling, and targeting in the last 20 years. He said that they have moved away from this in a progressive, humanitarian, and caring manner. He said that the at-large piece is the only insurance policy they have that positive, humanitarian, and caring people will rise to the surface irregardless of what part of the County they are in. He thinks that the present system has done a remarkable job and he supports proposal #5. He said that they have gotten things done in the County because they have only five members. The nomination piece needs to be as free and open and as democratic as possible. He wants to separate the politics from the human being. Commissioner Foushee said that she supports proposal #5. She said that she toyed with seven members but she thinks that everything can be accomplished with five members. She said that she has not made up her mind about nominated districts versus residential districts for the primary. Commissioner Gordon said that she supports proposal #5 and noted that she proposed it. She said that this proposal does things like track the population numbers closely so that the number of votes per commissioner seat is about as close to 1 person 1 vote as it can be. She thinks that five County Commissioners are a more effective Board. She said that, as far as the nomination versus residency, she is not ready to comment on this yet. Regarding the transition, she would pick 2008 as the implementation date. Chair Jacobs said that he has been moved by listening to people advocate for a more democratic and more responsive process. He said that this also brings out the more conservative side of how he acts, which is sympathetic to the idea that once you make a choice, you cannot go back. He said that, after being responsive and democratic, his most significant concern is that they do not become mare divisive about the decisions they make on how to do this. The three most important things to him are to vote for a majority of the Commissioners in every election; to make the process mare democratic; and not to make the process more divisive. He said that he has talked with other elected officials and managers from other communities and they have said that they run the risk of people representing a parochial view to the point of not having the overall view foremost in the consideration. He thinks that the County Commissioners genuinely try to think about what is the best thing for everyone in Orange County and not what is best for their neighborhood or their district. He said that the reason that he proposed #3 with 7 commissioners is because he wants to do what is best for the County and this proposal is more representative. He is very much opposed to nominations from districts. However, he is willing to come off #3 since his colleagues are all interested in #5. He would rather start slow. He said that he is for districts but not for district nominations. The Board agreed with the implementation date of 2008. Five or seven members: A motion was made by Commissioner Carey, seconded by Commissioner Gordon to approve having five County Commissioners on the Orange County Board of Commissioners. VOTE: Ayes, 4; no, 1 {Chair Jacobs) Maps: A motion was made by Commissioner Gordon, seconded by Commissioner Carey to approve map #5. VOTE: UNANIMOUS District or At-large NominationlDistrict or At-large Election: A motion was made by Commissioner Halkiotis, seconded by Chair Jacobs to approve at-large nominations {districts by residence). VOTE: Ayes, 3; Nays, 2 {Commissioner Carey and Commissioner Gordon) A motion was made by Chair Jacobs, seconded by Commissioner Halkiotis to approve elections at-large. VOTE: UNANIMOUS Chair Jacobs said that map #5 would be taken to the meeting on March 2"d. The implementation will be in 2008. The proposal is for residential districts and at-large nomination and election. Commissioner Gordon would like to da something in the line of preparing for the transition process. Chair Jacobs suggested asking Geof Gledhill to review Commissioner Cordon's outline for March 2"d and have this as part of the decision items or for review as a decision item on March 21St Geof Gledhill said that this is an excellent way to implement proposal #5. At this time, there was a break for dinner. 6:30pm -7:05pm Item #3 was addressed after item #4. 4. Buckhorn Road EDDlCommunity Water/Sewer Project -Protect CompletionlTiming Issues John Link said that in hindsight, he and staff would have encouraged the consulting engineer to be more diligent in examining where the State was in their review process. He said that they are not up to speed on some of this because they have not done these kinds of projects before. He said that they have been working with the City of Mebane to try and work out a solution, which is to try and stay on schedule with having the water and sewer line connections to Gravelly Middle School in time for it to open in August. The first problem has to da with the State Construction Loans and Grants process. A grant was received through Congressman Price, and the plan had been to use the grant to directly be part of the revenue far the extension of the line to the middle school. In January they discovered that the people in the State Construction Loans and Grants department had not even begun to do the review necessary to get the County going on this project. They have tried to see what they can do to make up for 8 weeks. Secondly, they have found out that the material that the City of Mebane sent to the engineers in Raleigh indicated that the capacity of the lift station an Vestal Drive is not sufficient for this area, including the school. However, in the meeting of the Chair, Vice-Chair, staff, Mayor, Mayor Pro Tem, and the Manager of Mebane, they assured the County and have tried to assure the people in Raleigh that it is not a question of capacity of the lift station, but the data was incorrect. He said that they are optimistic as of this morning that the City of Mebane and County Engineer Paul Thames have worked through a solution with the lift station. There is still an issue with expansion of sewer lines going into the lift station. He said that they need to reconfigure the financing so that they do not use the grant money far the school section of the sewer, but for the Buckhornlcentral Efland part of sewer system. This part has an outstanding amount of money required of about $1.6 million. He said that they are proposing a way to address the part of the water and sewer system that goes to the school with County CIP funding that eliminates having to go through the federal process. One possibility of funding is to delay monies for conservation easements and other County projects, and spend money this year on the school part of the water and sewer and then restoring the funding next year. The water and sewer must be in the ground by July. Chair Jacobs asked for a description of what would go on south of the interstate and the Buckhornlcentral Efland aspect. County Engineer Paul Thames showed the areas on map #6. He said that the line that was too small was approximately 1,200 feet, and the proposal is to replace the 8-inch line with a 12-inch line. This will address the concern as to the capacity of the line. Chair Jacobs asked if this was previously in Mebane's master plan for its systems and Paul Thames said not that he knows of, but he thinks that they had to have known that it needed to be upgraded eventually. Chair Jacobs asked if Mebane has an adopted master plan and Paul Thames said that he did not know. John Link said that they would find out. Commissioner Halkiotis verified with Paul Thames that the State permitted this line when it was created. Paul Thames said that his personal belief is that Construction Loans and Grants have the EPA looking over their shoulder all the time and they have a much stricter approach. Unfortunately, now that this has been flagged, they have to da something about it. The way Mebane has dealt with it is that they found some problems in their force main, they fixed that and increased the rating capacity of the pump station from 350 gallons/minute to 500 gallons/minute, and they are proposing to disconnect one pump station from another one and have it pump straight into the force main line. He said that this will address their problem here, but Mebane still has to do a modeling study for Construction Loans and Grants. The other thing that they have worked out with Construction Loans and Grants as of this morning is that when the proposal and timetable are accepted by Construction Loans and Grants, then they will give the County authority to advertise the school project. Several clarifying questions were asked of the County Commissioners and answered by Paul Thames. Paul Thames said that he is assuming that this will move forward and they hope to be able to advertise the project by the end of next week. Chair Jacobs asked about guaranteeing that Mebane will get the work done in a timely manner and said that there mayor may not be an issue of funding. John Link said that Mebane might want the County to fund half of it and Paul Thames said that it would probably just be for the 1,200-foot line and not for the pump station. Commissioner Halkiotis suggested that the Manager contact the Manager of Mebane to see what Mebane is going to do. He asked if the County had a responsibility to do a line improvement that far away from its proposed project. Chair Jacobs said that this is why he raised the issue of whether Mebane already had an adopted master plan, because if this was scheduled to be upgraded anyway, then they have already identified it as a weakness in their system and it is not relevant to what the County is doing except that it has brought it to someone's attention faster. He suggested that whatever communication there is with Mebane that it be in writing. John Link said that he had a conversation with the Mebane Manager yesterday and he indicated that the cost of this line would be $100,000 and that it was not in their present plans to make the improvement. The Manager of Mebane spoke with the Mayor who thought that a 50-50 split would be appropriate. At this point, it is not in writing. He will ask for it in writing. Chair Jacobs wants to know if Mebane already has an approved plan for making this improvement, because he would be willing to loan them the $50,000 that Mebane would have to spend anyway. He is not sure that it is the obligation of Orange County taxpayers to fix Mebane's system when Mebane knew that it was going to have to fix it. Commissioner Carey asked if the State required a master plan and Paul Thames said not that he is aware of. Commissioner Gordon said that she would like all of this in writing -the problem, the solution, and the casts. She said that she reads that it may be possible to open the school on time if all of these elements come together. She thinks that it is important to be thorough and orderly so that the school can open on time. Paul Thames said that he has email correspondence with Construction Loans and Grants affirming the conversation of what they are asking as of this morning. He said that the permit for this system will have all of the steps listed out and when they have to be completed. The missing piece in the paper trail is for Mebane saying what they will pay and John Link said that he would pursue this in writing. John Link asked Paul Thames if they were to pursue taking the school section out of the grant, if it would hurt the County from using the grant for the other purposes and Paul Thames said no. He said that he could have this in writing tomorrow. Chair Jacobs said that the State has not followed the County's schedule one time, so the County Commissioners will do it when they are comfortable that they have the answers in writing, that they are not being extorted by anybody, and that they have valid written assurances that what they are doing is for the betterment of Orange County. He does not want to rush to give Mebane $50,000 so that the State will not be embarrassed in Atlanta. He said that, at this point, Orange County needs to nail down what is in its best interest before making a move to do anything different than what was planned. John Link said that they would do the best they canto get everything in writing. Commissioner Halkiotis asked Geof Gledhill about future commercial enterprises that may hook up to this sewer line in the EDD and if they would pay some of the costs associated with building this line. He asked if this 1,200-foot line could be added to the additional casts. He said that it sounds like either the State is going after Mebane to get it to upgrade something or there is anticipated additional growth for Mebane that the State wants them to be ready for. If this can be part of the total cost package, he does not have a problem with it. He would like to recoup the money somehow. He agreed with Chair Jacobs that if it was part of Mebane's plan to upgrade sometime in the future, it changes things. Chair Jacobs asked Paul Thames, John Link, and Geof Gledhill to go to Mebane and meet with them face to face and John Link said that they would. Chair Jacobs asked Paul Thames to carry on with the Buckhorn/central Efland portion of the presentation. 5. Efland Sewer System Master Planning Paul Thames referred to the foldout map with the abstract. He said that the area that they were talking about taking out of the project if they go to a non-grant funded pracess, is the area along Buckhorn Road, the section between I-85 and the railroad. The entirety of the project was the northern Buckhorn section, the People for Progress area, the school, the EDD, and central Efland (Phase I-B}. The project was split by taking out central Efland to accelerate the school, and now they are reconfiguring the grant to pay for the school outside the grant pracess and make the grant project be the north Buckhorn and central Efland area. This preserves the portion of the grant that addresses environmental justice. The environmental justice portion of the grant, People for Progress, has to stay with the grant. Chair Jacobs asked Planning Director Craig Benedict if there was any other significant change in the map besides the fact that the proposed McGowan Creek subdivision is different. Craig Benedict said that the two projects that have been built recently are Ashwick and Richmond Hills subdivisions. These are in the existing public water and sewer. The proposed McGowan Creek subdivision is now an exempt subdivision without public water and sewer. Commissioner Gordon asked about the costs of each of the portions. Paul Thames said that the sewer part for the Buckhorn EDD1Gravely Hill Middle School portion is approximately $1 million and the sewer part for the other North Buckhorn Road portion is $425,000. The cost of sewer for the third portion for Central Efland is approximately $2 million. Chair Jacobs verified that central Efland is the fulfillment of the bond issue from 1997. Chair Jacobs asked how the timeline would work and how much work has been done and haw much of a delay there would be far the people an Buckhorn Road because of the switch. Paul Thames said that his belief is that by taking this part out they are prolonging the time that the People for Progress get sewer by 2-3 months. Commissioner Gordon would like to have assurances that changing will not affect the grant because the original project had same geographical continuity. Chair Jacobs agreed and said that they need to be sure that the grant will not be affected before they take a step. John Link said that is why they need items in writing and they have alerted Congressman Price's office. Commissioner Halkiotis asked for a list of what is needed in writing, by what agency, and the timeline. The list is as follows: - Assurance from Construction Loans and Grants that they can reconfigure the pracess Assurance that the reconfiguration will work from Construction Loans and Grants Agreement between Orange County and Mebane on how to fund the improvements Assurance that the reconfigured Buckhorn RoadlCentral Efland project still qualifies for the federal grant. Paul Thames said that he would talk with Bobby Blawe, the Section Chief of Construction Loans and Grants, tomorrow morning. Chair Jacobs suggested having the answers by the meeting of February 21, 2006. Paul Thames went through the timeline on page 6 of agenda item 4. Commissioner Halkiotis made reference to Paul Thames' comment about capacity for teachers and administrators moving into the school. He asked for something in writing about this. John Link said that they need to formally inform the school board and he has been keeping Superintendent Shirley Carraway apprised. Commissioner Gordon said that they have not really focused on the water part of the school project. She asked Paul Thames about this. Paul Thames said that the water part of the project comes from the southeast corner of map #6, at the Petro Mart, down to the intersection of Buckhorn Road and West Ten Road, down to the school. It is laid in the same trench with the sewer line so that the two lines will be installed simultaneously. The line work can be put in place in approximately 60 days, so they can get water to the school in half the time that they can get sewer to the school. Commissioner Halkiotis said that no one on the OCS Board has a clue about what has been involved in this project from the beginning. He said that this has been one huge headache to get electricity, water, and sewer to this area. He said that he hopes that someone has learned something from this and that there is a game plan for the process the next time. This is not the first time that a school may not be opening an time. Pathways Elementary did not open until after Christmas. Chair Jacobs asked Dr. George McFarley about the budget for the hookup fee and he said that Mebane had talked about waiving this fee and that OCS had not budgeted anything. Paul Thames said that the conversation he had with Mebane today was that they were waiving the hookup fee. Chair Jacobs asked if staff could look back and see if at any point anyone said what this would cost, because he cannot believe that they would have budgeted a project without anticipating some charge to hook into the system. He suggested getting same cost figures from neighboring systems, such as OWASA. Commissioner Halkiotis said that there was no figure on this when he was still employed by OCS because the discussion all along had been that the lift station would be handling both the school and whatever was coming from the soccer complex. When Cedar Ridge was built, the Town of Hillsborough charged $280,000 for a hookup to water and sewer. He said that there needs to be upfront data and upfront agreement with the hookup fee. Commissioner Gordon asked if it is in writing that Mebane would waive the fee. . Chair Jacobs said that the County Commissioners are anticipating answers to a series of questions and an agenda item on February 21St that includes the answers to those questions in writing as well as the repeat of the information about the options to pay for it. Commissioner Gordon said that they need to ask for full disclosure from Mebane, the state agency, and the federal agency. John Link said that they would inform Chair Jacobs on Tuesday morning what has been accomplished. He said that this would not be an item that the Board could expect to receive prior to the meeting. Paul Thames said that it may be difficult to get an answer from the state as to whether they are going to sign off on Mebane's proposal about reworking the pump station and lines. 3. Water and Sewer Assessment Process Paul Thames said that the Chair and Vice-Chair have suggested that there may need to be a way of generating revenue with grant funds, etc. to offset some of the costs of the projects in the Efland area. One of the ways to deal with this is an assessment project. The County has the statutory jurisdiction to initiate a process. They have asked John Greene, Director of Operations for OWASA, to talk about his experience with assessments. John Greene made a presentation. WATER AND SEWER ASSESSMENT PROCESS February 16, 2006 SPECIAL ASSESSMENTS - NC General Statutes ~153A -Article 9 / Assessment process initiated ^ Petition from property owners • Governmental entity / Staff develops project cost information / Preliminary Assessment Resolution adapted / Public Hearing held on proposed project / Final Assessment Resolution adopted / Construction bid and award / Determine final project costs / Preliminary Assessment Roll adopted / Public Hearing held on proposed assessment / Final Assessment Roll adopted / Billing of assessments ASSESSMENT PROCESS ^ Preliminary Assessment Resolution must include: / Statement of intent / Description of project / Basis for the assessment / Area to be benefited / Percentage of cost to be assessed / Assessments held in abeyance / Payment terms (years, interest rate) / Date, time & place of public hearing ASSESSMENT PROCESS ^ Basis for the Assessment - Front footage abutting project at an equal rate per foot of frontage - Street frontage of lots served at an equal rate per foot of frontage - Land area at an equal rate per unit of area - Land value at an equal rate per dollar of valuation - Number of lots served at an equal rate per lot - Any combination of the above ASSESSMENT PROCESS ^ Benefited Area ~ Include all potential areas to be served in initial Preliminary Assessment Resolution ~ As detailed design and public hearings move forward benefited area can be reduced but cannot be enlarged ASSESSMENT PROCESS ^ Project Cost - Board or Commissioners determine total project cost which can include: ^ Construction ^ Legal ^ Interest paid during construction ^ Right-of-way acquisition ^ Publishing and mailing cost ASSESSMENT PROCESS ^ Assessments in Abeyance - Held until property connects to extension - Held for a certain time period (not to exceed 10 years) ^ Payment Terms - Term not to exceed 1 Q years - Interest rate - First payment 6Q days after final roll adoption - Annual payments thereafter ASSESSMENT PROCESS ^ Preliminary Assessment Roll / Description of lots to be assessed / Basis for the assessment / Amount assessed against each lot / Name and address of property owners / Terms of payment / Date, time & place of public hearing ^ Final Assessment Roll ^ Bllling a55e55ed partle5 Commissioner Carey asked about holding collections in abeyance for five years and if that meant that there was only five years left to recoup the costs because of the ten-year limit. Geof Gledhill said that you can collect over ten years na matter when you start because it matches the development of the property with the water and sewer. Jahn Greene said that the (~WASA board adapted some policies that said if people hooked up within a period of time, then there was a reduction in hookup fees. Commissioner Halkiotis asked if someone decided to build a commercial facility in the County's EDD and wanted to hook an to sewer, could the County charge an assessment fee based on the square footage to be served to this facility. Geof Gledhill said that the assessment process is related to the construction of facilities and not to the capital costs of operating the facilities. Commissioner Halkiotis asked haw the County would recoup its money from building this line. Geof Gledhill said that the County has to set the cost before the development is known. He does not see anything in the assessment law that allows the County to make the choice after the fact about the fees. Paul Thames said that because of the location of a lot of the wells along West Ten Road and Buckhorn Road, they would have to shut down the wells because they cannot occur close to a sewer line. There are at least ten cases of this. Commissioner Halkiotis asked if the residents had been told about this and Paul Thames said that he did not personally tell them, but most people in this area asked for a water hookup. He said that there are two houses on very large lots on West Ten Road that do not want anything to happen. They will not be happy about being put on the line. Chair Jacobs said that they need to think this through, and he is in favor of doing an assessment project because he wants to recoup the money. He wants to play with having a cushion to help people of low income with the assessment revenues, so that their fees can be reduced or revenue neutral for affordable housing. Chair Jacobs asked if the Board was interested in doing the assessment project and all agreed. Discussion ensued about recovering the expenditures. Chair Jacobs asked staff to craft an area that would be applicable for an assessment project, the parameters, what costs might be recovered, and when it could be initiated. 5. Efland Sewer System Master Planning This was addressed above, but Chair Jacobs wanted to ask Pau! Thames some questions. Chair Jacobs said that it has been a longstanding issue that the Efland sewer rates did not recover the cost of the service and Paul Thames said that this is correct. Chair Jacobs asked how much everyone else in Orange County was subsidizing for this per year and Paul Thames said that out-of-pocket expenditures are probably about $80,OOOlyear. He said that what they should be doing and what they will have to start doing is inspecting the lines and have an adopted capital improvement program for the system. These are conditions of a new permit for the collection system. They have to have the permit because they have a rating capacity in excess of 250,000 gallonslday, even though they are only actually doing 30,000 gallonslday. They have set no money aside to replace capital equipment when it comes due. Generally, generators and pumps and other big-ticket items have about a 25-year lifespan and these have been in place for 18 years. Chair Jacobs asked that when they do the Central Efland plan and put the infrastructure in place, if that would be the time to address the inequities in the current rate system and Paul Thames said yes. Paul Thames said that they would be essentially doubling the number of users. Chair Jacobs asked that, as part of doing the Central Efland sewer planning, that the rates be part of the planning so that the County can recoup the costs and plan for capital improvements. Commissioner Halkiotis said that he thinks it is terrible that the County will be doubling its deficit by building this system. He asked what the OCS pays far sewer service to the Efland-Cheeks Elementary School. He said that this was the genesis of the County getting into the sewer business when the school's underground system failed. Paul Thames said that it costs between $1,000-1,500/month. This is based on 5,000 gallonsJday. Commissioner Halkiotis asked why the deficit has continued to grow and Paul Thames said that they charge $4.20 for every thousand gallons over 3,000 gallons minimum. The County pays Hillsborough $9 per thousand gallons to treat the sewer. Commissioner Halkiotis said that recently they had a breakfast meeting with the Mayor of Hillsborough, the Mayor Pro Tem, and the Hillsborough Town Manager, and he was shocked to hear that the Manager was saying that they were seriously considering letting Durham take care of all of their sewage treatment. He wants the County to recover what it is paying for sewage treatment. He made reference to the Ashwick subdivision and said that they are getting a good deal an sewer. Chair Jacobs said that part of the reason they have pushed planning to get the Efland/Mebane recommendations by the time the water and sewer goes in is because Efland is going to experience explosive growth once the infrastructure is there. He said that to have people living in $300,000 houses and not paying a full rate is nat satisfactory. He said that if the County does subsidize, it should be targeting as opposed to having a blanket subsidy. John Link said that staff is behind doing this in a utilitarian way. He said that Paul Thames needs to share with the Board what is a reasonable rate to charge far sewer. Chair Jacobs said that, once they have a projected date for completion, then they need to work back on when to take some actions on the rate. 6. Efland-Mebane Small Area Plan Task Force Update Craig Benedict said that the Efland-Mebane Small Area Plan Task Force was authorized in December 2004 and they have had over ten meetings. The study area goes from the Eno River over into Mebane's jurisdiction. The task force had representatives from Mebane -Mayor Pra Tem, Chair of the Mebane Planning Board, and community residents. They have addressed all areas such as transportation, land use, utilities, etc. The majority of the issues have to do with utilities. He said that the OrangelAlamance Water System has been upgraded and now that their allocation system is clearer, they need to look at their infrastructure. He said that if the intent of the task force plan is to study the potential for directing growth to these urbanizing areas, they have to be able to answer questions about the water systems. He made reference to a map that is part of the agreement area. He said that there will be same recommendations coming forward to the task farce, and there will be placeholders in the land use plan to convert some areas to mixed-use development. He made reference to tract 6B, which is the border of Orange Caunty and Alamance County. There are many developments occurring on this border, including two 300-unit developments. One of the bad access issues is that Efland-Cedar Grove Road has a high amount of traffic coming from counties to the north and taking two 90-degree turns to get on I-85. There is a suggestion for a better alignment for this road because the road is getting torn apart. There is a suggestian to put aright-turn lane on the I-85/US 70 connector road, which would take some of the pressure off the Mt. Willing Road intersection. The study group is also reviewing open space issues and they have the draft plan. They will be meeting on February 28t" to talk about the final draft. They hope to have a community meeting in mid-March. There will be recommendations coming from the task force that will be able to tie into recommendations for the land use plan update coming up in May. Also, the Transfer of Development Rights Task Force has representatives of the Efland community, and this area would be a receiving area, which is an area where they believe could accommodate more growth because of public water and sewer systems and better transportation systems. 7. Confirmation of Public Hearing Notice and Establishment of Public Hearing Date for Debt Service Financing Rod Visser said that the Board of County Commissioners set the public hearing far March 2°d and the intent was to come back at this meeting and firm up the language of the advertisement, which needs to go out this weekend. He suggested removing references to individual project amounts. All that has to be done to meet the requirements is to state a "not to exceed" amount. Rod Visser said that the total debt service payments remain within the constraints, and they are acting an the Local Government Commission's advice. Chair Jacobs clarified that the Board was being asked to vote on the language, "not to exceed $24,000,000" and Rod Visser said that they would strike individual project amounts. A motion was made by Commissioner Halkiotis, seconded by Commissioner Carey to approve the language "borrow an amount not to exceed $24,ao0,0o0"and leave off the individual estimated costs, approve the final text of the notice for the March 2, 2006 public hearing, and authorize the Clerk to publish the public hearing notice. Commissioner Gordon said that she needs to know the numbers by March 2"d before she can vote and Ken Chavious said that he would like to have those numbers by then too. VOTE: UNANIMOUS With no further items to discuss, the meeting was adjourned at 9:25 p.m. Barry Jacobs, Chair Donna S. Baker Clerk to the Board