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HomeMy WebLinkAboutMinutes - 20070524APPROVED 8/21/2007 MINUTES ORANGE COUNTY BOARD OF COMMISISONERS BUDGET PRESENTATION AND WORK SESSION May 24, 2007 7:30 p.m. The Orange County Board of Commissioners met for a Budget Presentation and Work Session on Thursday May 24, 2007 p.m. at 7:30 p.m. at the F. Gordon Battle Courtroom in Hillsborough, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Moses Carey, Jr. and Commissioners Valerie P. Foushee, Barry Jacobs and Mike Nelson COMMISSIONERS ABSENT: Alice M. Gordan COUNTY ATTORNEY PRESENT: Geoffrey Gledhill COUNTY STAFF PRESENT: County Manager Laura Blackmon, 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 p.m. Chair Carey said that this was a combination meeting -the presentation of the Manager's Recommended Budget and a work session. The budget presentation will be televised. Commissioner Gordon was unable to attend. Presentation of Manager's Recommended FY 2007-2008 Budget Laura Blackmon said that this is her first budget presentation as a Manager. She thanked all staff that worked on this. Manager's Recommended Budget Fiscal Year 2006-07 Orange County, NG May 24, 2007 Presentation to Board of County Commissioners Tax Goal • Meeting pressing needs and mandates related to children, seniors, economically disadvantaged has come at a price Commissioners concerned that historical tax rate increases and rising property valuations have become a burden for some taxpayers April 2007 Board Adopted Tax Goal - Fiscal year 2007-08 targeted tax rate increase is amount required to pay new debt service obligations Recommended General Fund Budget Totals $172.2 Million • Recommendation represents a 5.3 percent increase over 2006-07 original budget • Increase of $8.7 million over original fiscal year 2006-07 budget of $163.5 million Recommended Tax Rates • Countywide ad valorem tax rate of 94 cents per $100 of assessed valuation - Increase of 3.7 cents over the 2006-07 rate of 90.3 cents • Impact an taxpayer with $200,000 in valued property is $74 per year - One cent on property tax rate generates $1,247,881 • Maintains Chapel Hill Carrboro Special District tax rate at 18.85 cents per $100 of assessed valuation - One cent on property tax rate generates $802,246 General Fund Revenues- pie chart Education Funding Overview • Overall Education support totals $82.5 million -Includes funding for local school systems and Orange County Satellite Durham Technical Community College • Increase of $2.2 million from fiscal year 2006-07 approved support Education Funding Current Expense • Total current expense funding equals $55 million - Chapel Hill-Carrboro Schools - $33.7 million - Orange County Schools - $21.1 million - Durham Technical Community College - $181,000 Increase provides funding for 11,530 elementary, middle and high students - Increase of 338 students from previous school year - Recommended budget maintains per pupil appropriation for CHCCS and OCS at $2,957 • CHCCS to receive additional $15,122,338 from district tax - Equivalent of $1,329 per pupil • Provides 4 months operational funding for community college satellite campus Per Pupil Allocations fo Local Schools State Mandated Funding Formula -table Additional Education Funding • Recurring Capital - $2.4 million • Long-Range Capital - $4.1 million • Debt Service for School Facilities - $18.9 million • School Health Nurses - $566,744 • School Social Workers - $557,272 • Fair Funding for School Health and Public Safety Expenses - $800,000 Debt Service • County's obligation for debt increases by $4.6 million - $2.2 million for partial year debt service on $59 million new debt authorized to construct several new facilities including two schools, a technical community college satellite campus, senior center, justice facility and soccer complex - $2.4 million required to offset loss of Lottery proceeds previously dedicated to repay school related debt service Full Funding of Local School Requests • To fully fund Orange County Schools budget request increase of $3.7 million would cost 7.6 cents on ad valorem tax rate To fully fund Chapel Hill Carrboro City Schools budget request increase of $6.8 million would cost 9.01 cents on ad valorem tax rate Medicaid Uncertainty • North Carolina is only state that mandates its counties to pay costs of Medicaid • Recommended funding increases $545,436 bringing County's total Medicaid appropriation to $4,570,236 • General Assembly actions this summer may lessen funding needed in upcoming fiscal year Employee Pay and Benefits • Majority of costs associated with recommended pay and benefits package offset by salary savings - 3°~ cost of living adjustment effective July 1, 2007 - Reinstating in-range salary adjustments for employees with proficient or higher work performance - Increase in the County 401 (k} contribution for all employees (other than sworn law enforcement officers} by $5 per pay period - 15% increase in health insurance premiums - $100,000 far a Classification, Pay, and Benefits Study - Increase in the County's living wage from $9.67 per hour to $10.12 per hour New Staff Resources Recommendation includes 9.1 new staff resources to comply with State mandates and staff new facilities • Net County cost of new staff totals $259,155 - Environmental Health Specialists and Technician -Three positions to inspect food and lodging establishments, comply with new unfunded State mandates associated with water sampling and well permitting, test indoor air quality - Recreation and Parks -Three positions to staff West 10 Soccer Center and Northern Park - Department of Social Services -Two positions to meet increasing demands for Food Stamp, Medicaid and Health Choice programs and serve as school social worker for Gravelly Hill Middle School. - HOME Program -administer the HOME Investment Partnership Program and assist in development of local programs using HOME funds. Solid Waste Enterprise Fund • Transition of Sanitation division from General Fund to Solid Waste Fund o Combines like functions in one department o Makes sense to users • Recommended increase in 3R fee will generate $567,000 in additional revenue o Basic Fee -from annual rate of $34 to $37 o Multi-Family -from annual rate of $48 to $56 o Rural -from annual rate of $50 to $63 o Urban -from annual rate of $73 to $81 Document Availability • Orange County Budget Office - 208 South Cameron Street, Hillsborough • Clerk to the Board - 200 South Cameron Street, Hillsborough • Public Libraries in Hillsborough, Chapel Hitl, Carrboro and Cedar Grave • County's website - www.co.oranc~e.nc.us Budget Schedule • Budget Public Hearings - May 31, Superior Courtroom, Hillsborough - June 4, Sonja Haynes Stone Center, UNC Campus, 150 South Road, Chapel Hill • Budget Work Sessions - June 5 -Southern Human Services Center - June 7 -Government Services Center - June 14 -Southern Human Services Center - June 18 -Government Services Center - June 21 -Southern Human Services Center • Budget Adoption - June 26 -Southern Human Services Center • Ail meetings start at 7:30 p. m. Commissioner Jacobs asked Laura Blackmon to explain to the public what budgeting in arrears far the lottery proceeds means. Laura Blackmon said that there is a lot of uncertainty with the lottery proceeds. Also, the projection last year far the monies received in the current fiscal year was $2.8 million, and the proceeds will only be $2 million. Budgeting in arrears means that the County will collect the money for one year but not budget it. It will be budgeted the fallowing year. Commissioner Jacobs asked about page 5 and the $59 million of new debt. He asked how much was for the two schools and Durham Tech. Budget Director Donna Coffey said $36 million - Carrboro High School gets $9 million, Elementary #10 gets $24 million, and Durham Tech gets $3 million. Commissioner Jacobs asked if the County Commissioners would receive scenarios going down to a zero budget increase and it was answered yes. Commissioner Jacobs said that the Board adopted a policy a while ago that the target for school spending was to be 48.1 °fo and the current calculation is 47.9°~. Donna Coffey said that the support for outside agencies is not included, and this would take it right above 48.1 %. Commissioner Jacobs pointed out that, of the $59 million in new debt, about 61 °k is for schools. Chair Carey asked for clarification for the public on the $800,000 in fair funding for schools and Donna Coffey said that it is split 50-50 between the two school systems. Commissioner Jacobs asked why each school system is asking for a nursing position through their budgets instead of proposing that it be funded through this mechanism, which is outside the per pupil. Laura Blackmon said that she has not talked to the schools about this. She will make sure that this will be included in the presentation on June Stn Chair Carey said that there will be two public hearings and five work sessions on the budget. BREAK (for broadcast equipment breakdown) 1. Proposed Jordan Lake Nutrient Management Rules Environment and Resource Conservation Director Dave Stancil said that though this is still years away, there are some very important decision paints coming up this summer related to the new rules for Jordan Lake Watershed, particularly the Upper New Hope arm of the lake. This affects southeastern Orange County. He said that the opportunity to provide comment on this might expire over the summer break. He introduced Syd Miller, Water Resources Program Director for Triangle J Council of Governments. Syd Miller shaved a map of the Jordan Lake Watershed. In the Upper New Hope arm, the largest reduction in nutrients is proposed - 35°~ reduction in nitrogen and 5% reduction in phosphorous. There are 12 rules that have been proposed. One of the most significant rules is the existing development rule and the new development rule. There will be very stringent controls on new development. For existing development, there will be three years to do a feasibility study and implementation plan to figure out how to reduce the current loading. The rules were approved by the EMC at the March meeting. The Division of Water Quality is working with the Governor's Office to package it so that it can be in the June 15, 2007 NC Register, and then there will be a 60-day comment period. After the comment period, there will be a Public Hearing Officer's Report. Then it will be seen by the Rules Review Commission, and most likely the NC General Assembly will consider the entire package. Mr. Miller said that Orange County can influence this body of rules. One way is in the public hearing and public comments period. Also, the County can lobby the General Assembly when it considers it sometime in the 2008 session. However, the reductions have to be achieved somehow. Commissioner Nelson said that most of the upper New Hope area is already built out, so this would mainly involve retrofitting development. Dave Stancil said that most of this relates to the rural buffer. Syd Miller said that whatever is built there has to be dealt with in some way. Commissioner Nelson said that he has heard people say that southern Orange County is doing a good job of keeping the lake clean by using buffers, etc. He asked how this could happen to the lake. Syd Miller said that it is a shallow piedmont lake and these kinds of lakes are sensitive to nutrients. Also, the highly built areas in Chapel Hill and Durham put a lot of stuff in the watershed and it makes its way dawn into the lake. Commissioner Jacobs made reference to the background information in the abstract, specifically, "Over the last 20 years, water quality has become an issue for Jordan Lake," and said that he did a story in 1979 for the Charlotte Observer. He read part of this article. "Critics of the Jordan Lake project, including federal and state water quality experts warned that parts of the lake would be so clogged with algae that it would smell and taste bad, making the lake a possible health hazard, unsuitable for many of its intended uses. `It makes little sense for us to sit around now and talk about how green the Jordan may run,' said Howard Lee, Secretary of Natural Resources and Community Development while touring the Jordan project recently. `It makes more sense for us to get ahead of the game by laying plans for responding to those water quality problems as they develop.' The state originally had no special plan for monitoring water quality in Jordan Lake. Then the project was slowed for several years by a lawsuit by the Council of North Carolina environmental group and Durham and Chapel Hill, upstream municipalities which discharge nutrient-laden affluent into the New Hope. Besides questioning the lake's water quality, their suit argued that completion of the project would lead to expansive and extraneous water treatment costs for upstream municipalities, likely to be blamed for fouling Jordan Lake. There was also a quote from Jim Wallace, Mayor of Chapel Hill, "There will be a lot of crow eating, and I don't expect to be eating the crow." Jim Wallace was also a member of the State's Environmental Management Commission and a leading critic of the project. Commissioner Jacobs said that it has been almost thirty years later, and in a lot of ways, what the leaders of Chapel Hill, Durham, and the Conservation Council predicted have come to pass. The costs and the burdens are going to be born by the municipalities that are at the headwaters of the lake and the state is slow to respond. Because it is going to be the rural buffer, it means that the agricultural community in Orange County is going to have to bear the burden of keeping the water clean for the downstream municipalities. He asked where is the reciprocity and if there has been any discussion with some of the municipalities that benefit from this clean water about contributing funds to conservation easements and other programs for retrofitting either the municipal areas or the rural areas of Orange County and Durham County. Syd Miller said that what was predicted years ago has come to pass, but not as bad as what was predicted. He said that, within the rules, there is a mechanism far nutrient trading. He said that he thinks local governments should lobby the state hard for putting forth some funds to help implement the remedy, because there is a disparity between who benefits and who pays. Chair Carey suggested that staff draft comments before the break related to what had been said tonight. Syd Miller said that TJCOG has been working with the staff of Orange County on this issue, and they will help coordinate these comments. Commissioner Jacobs suggested that Soil and Water and Cooperative Extension be notified about this. 2. Transfer of Development Rights (TDR1 Implementatian Planning Director Craig Benedict said that a consultant was to be here tonight, but no one had arrived yet. Short break. Chair Carey made reference to information in a recent Manager's Memo about the $132,000 from the state to access electronic records from each precinct. He asked what it means that the $132,000 is a "good start." Laura Blackmon said that Barry Garner will be giving an estimate as to what it will cost over and above $132,000. Commissioner Nelson left at S; 44 pm. Craig Benedict proceeded with the presentation without the consultant. Craig Benedict said that tonight is an update concerning the Transfer of Development Rights Implementatian program. This process is in phase 3. Phases 1 and 2 were case studies. The feasibility of the project was completed in 2006. Phase 3 is Ordinance Development, and the consultant; UNC-Charlotte Urban Institute and the Louis Berger Group; has been working with some advisory boards made up of the Historic Preservation Board, Ag Preservation Board, Planning Board, and Commission for the Environment; and has been working with a staff team of Geof Gledhill, Dave Stancil, Bryan Ferrell, and Planning staff to look at some of the indicators on how to design this program. He made reference to the last page of the agenda, which is the Program and Administrative Design Options, otherwise known as the "dashboard rules." Sending Area Designation -could be a focused area or a broad area. The work group decided to give more credits to a broad-based sending area (i.e., farming with environmental value}. The sending area credit calculation goes along with the same concept of accumulating credits with different activities. Receiving Area Designation -these are somewhat restricted areas designated by the land use plan. The consultant thinks that, if this is to work, the activity cannot be overly restricted, or there will not be any incentive for development. Interaction with Sending Area Landowner - it was decided that the developer should interact an a market basis with the property owner, and the government should scale back its involvement. Administrative Design - there would be low government involvement. Legal Authority- it is not the interest of the County, and the existing legislation in zoning authority will be used to achieve some of these results. Conservation easements are an example. Program Participation -other municipalities are in a "wait and see" made. The Attorney's Office believes that having TDR under Orange County's jurisdiction is the best starting point. Other municipalities could be pulled in at a later date. He said that the consultant has a timeline for design and will be providing updates throughout the summer. During the fall, the staff will be fashioning draft ordinances. Commissioner Jacobs asked about Development Agreements on page 3, item B- 3. Craig Benedict said that the Attorney's Office brought this to their attention and it is new legislation with the state that allows the County to creatively interact with the developer to set the conditions of development. Brian Ferrell said that this is a new tool that the legislature has given to counties for developments that are aver 25 acres in size. It gives flexibility for the municipality and the developer to get together and come up with a plan for development. Commissioner Jacobs asked if the plan was still to convert residential densities to non-residential square footage/units, etc. Craig Benedict said that the focus was to start with a residential to residential. The goal is to have the simplest of programs to start with, and a conversion program could happen later. Commissioner Jacobs said that, as a participant on the TDR Task Force, conversion to non-residential was a big component of what they were trying to do. Before he would be willing to transfer units into an economic development district, he would want to see the reasoning by the attorneys about why the non-residential conversion could not be done first. Otherwise, he does not see the point. Craig Benedict introduced Lisa Murphy with the Berger Group. Lisa Murphy said that the main reasoning for not tackling residential to commercial conversion right now is that, in order to get the incentives in place, they have to fully understand what they are doing. Craig Benedict said that they are not foregoing the opportunities to have the non- residential conversion, but just trying to make sure there is a very tight line during the conversion process. Commissioner Jacobs said that, even in a mixed use, unless the amount of residential is limited, it would be wasting the limited amount of water and sewer capacity. Craig Benedict said that, part of the incentive system is if the economic development areas have all of the intensity given to them by right in the existing zoning code, then there is no incentive for them to ask for more. This is the one issue that is being discussed with the consultant and Attorney's Office. Commissioner Jacobs made reference to Receiving Area Credit Calculation, Additional Credits, and said that there should be additional credit for minimal land disturbance. With no further items to discuss, the meeting was adjourned at 9:04 PM. Moses Carey, Jr., Chair Donna S. Baker Clerk to the Board