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HomeMy WebLinkAboutMinutes 04-25-2013 APPROVED 9/5/2013 MINUTES ORANGE COUNTY BOARD OF COMMISSIONERS CHAPEL HILL-CARRBORO BOARD OF EDUCATION ORANGE COUNTY BOARD OF EDUCATION JOINT MEETING April 25, 2013 The Orange County Board of Commissioners met for a joint session with the Chapel Hill—Carrboro Board of Education and the Orange County Board of Education on Thursday, April 25, 2013 at 7:00 p.m. at the DSS offices in Hillsborough, N.C. COUNTY COMMISSIONERS PRESENT: Chair Barry Jacobs and Commissioners Alice M. Gordon, Mark Dorosin, Bernadette Pelissier, Renee Price, Earl McKee, and Penny Rich COUNTY COMMISSIONERS ABSENT: COUNTY ATTORNEYS PRESENT: Annette Moore COUNTY STAFF PRESENT: County Manager Frank Clifton, Assistant County Managers Clarence Grier and Clerk to the Board Donna S. Baker (All other staff members will be identified appropriately below) ORANGE COUNTY BOARD OF EDUCATION MEMBERS PRESENT: Chair Donna Coffey and Board Members Tony McKnight and Debbie Piscitelli. Superintendent Patrick Rhodes was also present. ORANGE COUNTY BOARD OF EDUCATION MEMBERS ABSENT: Steve Halkiotis, Anne Medenbleck, Lawrence Sanders, and Brenda Stephens CHAPEL HILL-CARRBORO CITY SCHOOL BOARD OF EDUCATION MEMBERS PRESENT: Chair Michelle Brownstein, Mia Burroughs, and Board Members James Barrett, Jamezetta Bedford, Gregory McElveen, Michelle Brownstein, and Mike Kelly. Superintendent Tom Forcella was also present. CHAPEL HILL-CARRBORO CITY SCHOOL BOARD OF EDUCATION MEMBERS ABSENT: Annetta Streater. Chair Jacobs reviewed information at their places. He said a decision had been made, at the school collaboration meeting, to add a draft resolution on Pre-K, which will be addressed when they get to that item. Chair Jacobs said he appreciated that the boards can meet together like this twice a year and he appreciates the amicable relationships. He feels that these relationships are important in banding together against the onslaught on public education in North Carolina and the United States. 1. Presentation of Orange County Schools and Chapel Hill Carrboro City Schools Boards of Education Approved FY2013-14 Operating and Capital Budgets Orange County Schools Presentation Orange County Board of Education Chair Donna Coffey noted that four of their board members were unable to attend tonight - Steve Halkiotis, Anne Medenbleck, Lawrence Sanders, and Brenda Stephens. Superintendent Rhodes thanked the Board of Commissioners for their support and their investment in the schools over the years. He presented the following PowerPoint slides: Orange County Board of Education's Approved Budget 2013 -2014 Presented to the Orange County Board of County Commissioners April 25, 2013 Return on Investment ✓ Increased levels of student achievement ✓ Narrowed Achievement Gaps ✓ High graduation rates ✓ S.A.T. Scores exceed national average ✓ Ranked 4th in the state on the combined A.C.T. scores for the 2011-12 junior class ✓ Dropout rate is well below the state average Return on Investment ✓ 5 star rated, licensed pre-k programs ✓ A.L. Stanback Middle School was designated as a School to Watch and C. W. Stanford Middle School has the N.C.M.S.A.'s Region 5 Team of the Year ✓ Successful 1 to 1 laptop initiative (6-12) ✓ Engineering is Elementary STEM program at Central Elementary School Return on Investment ✓ Covey Leadership model at Efland- Cheeks Elementary School ✓ Nationally recognized, award winning arts and vocational programs ✓ Model literacy partnership with U.N.C. Chapel Hill ✓ Virtual Enterprise Program launched to support high school entrepreneurs Current Year Budget Overview (chart) OCS Per-Pupil Funding Rankings* Local Funding 4th ✓ State Funding 79th ✓ Federal Funding 107th ✓ Total Funding 39th North Carolina ranks 47th in the nation for state support of education" Revenue Sources for 2012-13 (Pie Graph) How Funds are Used (Pie Graph) 2013-2014 Budgetary Outlook 2013-14 Budget Drivers ✓ Increased student enrollment ✓ Federal Sequestration of 5.3% ($170,000) ✓ Higher state discretionary reversion ✓ Salary increase of 1% ($158,000) ✓ Increased benefit & utility costs 2013-14 Budget Drivers Unknowns ✓ Virtual charters ✓ School vouchers ✓ Changes in the allotment system ✓ Level of state funding County Student Enrollment Projection 2013-14 NC DPI Certified Students 7,501 Less Out-of-District Students 89 Plus Charter School Students 254 Total Projected by the BOCC 7,666 Projected Enrollment Increase: 81 State Student Population Projections (Bar graph) Student Eligibility for Free and Reduced lunch (Bar graph) 2013-2014 Federal Funding Outlook Federal Funding Levels (Bar graph) Impact of Federal Sequestration on OCS Programs ✓ Title 1 $46,559 ✓ Title 11 $11,200 ✓ Title 111 $2,829 ✓ IDEA $95,420 ✓ Career/Tech $3,705 ✓ 21St Century $10,600 Total Reduction: $170,313 2013 -2014 State Funding Outlook State per Pupil Funding (Bar Graph) Impact of State Funding Reductions If the state funded OCS at the same level as 2007-2009, the District would receive a substantial increase in funding. ✓ 2007-08 $5,571 per-pupil $1,981,140 ✓ 2008-09 $5,768 per-pupil $3,442,880 Comparison of State Funding* (Bar Graph) State Funding Reversions (Graph) Limit the Impact of State Funding Reversions Critical Need - $1,868,435 ✓ The state requires districts to revert money it originally funded to help balance the state's budget ✓ An increase of$80,337 from 2012-13 The Funding Reversions Result in Fewer Staff Positions (Graph) Funding Reductions from the Governor's Proposed Budget Reduction in funding for 27 $879,213 Teacher Assistants State Textbook Funding (Graph) Lottery Proceeds (Graph) Lottery Funds ✓ Cannot be used for day-to-day operations ✓ Cannot be used for technology purchases* ✓ Must be used for capital expenditures *Legislators are discussing allowing the use of Lottery Proceeds to purchase technology 2013-14 Local Funding Requests Per-Pupil Allocation (Graph) (Local Appropriation) 2013-14 Board of Education's Approved Budget District Priorities for 2013-14 ✓ Safety and security enhancements ✓ Academic rigor ✓ At-risk programs ✓ Elementary student access to technology ✓ S.T.E.M. initiatives and opportunities Unfunded Mandates Cost Increases ✓ Salary increase of 1% (Governor's Budget) $158,000 ✓ Local retirement contribution $46,000 ✓ Hospitalization Cost (Increase of$260 per Employee) $60,000 ✓ Utility cost increases $79,000 Total Increases: $343,000 Expansion Budget Requests ✓ Local school safety appropriation $220,000 ✓ Reading Teacher at Central E.S. $55,000 ✓ Pre-K itinerant E.C. teacher $55,000 Total Expansion Budget Requests $330,000 Total Unassigned Fund Balance (Chart) Total Fund Balance Appropriation ✓ Recurring Expenditures $686,643 ✓ Salary Increase of 1% (Governor's Budget) $158,000 ✓ Increase in Charter School Payout $46,807 Total Fund Balance Appropriation $891,450 Requested Increase in Per Pupil Funding ✓ Per Pupil Allocation at the 2012-13 level $24,278,222 ✓ Requested Per Pupil Increase of$158 $1,211,228 Total Local Requested Funding $25,489,450 The Board of Education's Recommended Local Budget Request for 2013-14: $25,489,450 Funding Recommendations ✓ County Per Pupil Allocation $25,489,450 ✓ County Fair Funding $494,000 ✓ Fines and Forfeitures $202,500 ✓ Interest $70,000 ✓ Appropriated Fund Balance $891,450 Total Local Funding: $27,147,400 Requested Local Budget ✓ Improves school safety and security ✓ Supports innovative and successful student centered programs ✓ Prevents teacher assistant job loss ✓ Continues to provide an excellent return on taxpayer investment Commissioner Dorosin arrived at 7:10. Superintendent Rhodes, referring to the slide on Budget Drivers, said the Governor's Budget is an unknown factor. He said it has been stated that there is no more funding to be approved for schools until problems in Health and Human Services are fixed. He said he is not planning for any additional funding, other than what the Governor has already identified. Superintendent Rhodes referenced the slide on 2013-14 Budget Drivers and said that there are 667 homeschoolers in Chapel Hill/Carrboro/Orange County and 416 home schools. He said that if a virtual charter is established, and half of those students sign up, this would equate to a drop of just over a million dollars in funding. He noted the all time high in students eligible for free and reduced lunch, and said that schools are a safety net for many students. He said that the spikes in 2010-11 Federal Funding Levels were due to the stimulus and stabilization efforts. He said that the current year federal funding amount is unknown, but it will be lower and affected by sequestration. He said that the impact of funding reversions has been absorbed in ways that protect the classroom up to this point. He said this has resulted in cuts to the central office staff and all staff members are now doing multiple duties. He said recurring fund balance reserves have also been spent. He said that the proposed budget reduces the funding for teacher assistants, and this will result in the loss of teaching assistant positions in grades 2 and 3 across the state. He said that the budget presentation included the claim of increasing teaching positions to cut class sizes; however the increased teaching positions simply mirror enrollment growth. He stressed the importance of small class sizes and said teacher assistants are critical in maintaining this. Superintendent Rhodes referred to the slides on Local Funding Requests and said the Board of Education is requesting an additional $158 per student for the coming year to increase the per pupil appropriation. He said this was approved on Monday night. He said that several one-time needs have been identified for the unassigned fund balance, including the 50 year old steam lines at Orange High School, which are leaking and will require a minimum of$1 million to repair. Superintendent Rhodes introduced and played a student video regarding the laptop program. Superintendent Rhodes said the school board appreciates the financial support for the laptop 1 on 1 program through the quarter cents sales tax. He said this has resulted in better student performance and fewer suspensions. Commissioner Dorosin asked if students have to turn the laptops in at graduation. Superintendent Rhodes said the laptops are returned and re-cycled for the next set of students. These are used for four years before being refreshed. Commissioner Price asked how many students still need laptops. Superintendent Rhodes said 4100 were deployed for students and 800 for staff. He said all high school and middle school students have laptops. He said that if funding is approved, computers will be purchased for 4th and 5th graders in the coming year; these will not go home with the lower grade students. Commissioner Pelissier thanked the board for providing information on what the schools get for their county funding. Commissioner Price gave kudos to the students who produced the video, and Superintendent Rhodes said this was done by students from Cedar Ridge High School. Chair Jacobs asked what is paid for through fair funding. Superintendent Rhodes said that funding pays for resource officers and school nurses. He said the legislators denied matching grants funding school resource officers and other security measures. Chair Jacobs said he asked Congressman Price about federal funding and was told that there had been discussions. Chair Jacobs thanked the board for the presentation and expressed appreciation for all that OCS does. Chapel Hill Carrboro City Schools (CHCCS) Presentation: CHCCS Chair Michelle Brownstein said Annetta Streater could not attend tonight, as she is out of town. CHCCS Superintendent Tom Forcella thanked the Board of County Commissioners for all of their support. He presented the following PowerPoint presentation: 2013-14 Board's Budget Request April 25, 2013 Challenge: ■ To move toward the fulfillment of our mission and vision while, at the same time, being cognizant of the extraordinarily difficult economic times Change Process • Driven by Mission/Vision/Guiding Principles in Long-Range Plans • Building Internal Capacity - Culture - Practices and Procedures - Staffing • Focus - Common Language of Instruction - High Quality Staff - Use of Resources Impact of Financial Support • Every elementary and middle school had an attendance rate of 96% or higher • Cohort graduation rate is 90% (versus 80.4% for state) Impact of Financial Support ■ Per North Carolina ABC's - Three Honor Schools of Excellence - Eight Schools of Excellence - Six Schools of Distinction - 16 of 17 schools met high growth Impact of Financial Support ■ SAT - 197 points above state average - 184 points above national average - 90% participation rate (versus 68% state and 52% national) Long-Range Planning Initiative ■ Greenhouse Project ■ Guiding Principles - "Growth Mindset" - Equity Focus - Professional Development - Positive School Culture - Accountability & Oversight Major Initiatives • FPG Dual-Language Magnet School • Northside Elementary • "Institute for Learning" — Professional Training and Development Setting Priorities • Instruction and Common Core - Professional Development— IFL - Literacy and Math Coach Training - Leadership Development - Common Language about Instruction • Safety Setting Priorities - Instruction Expansion M.S. Literacy Coaches $280,276 Prof. Development and Curriculum 141,425 $421,701 Related Reduction In-School Suspension $144,000 Middle School TA Reduction 280,276 $424,276 Efficiency Reductions $420,000 2013-14 Budget Drivers • Opening Northside Elementary School • N.C. General Assembly Long Session uncertainty • Slow economy • Continuing cost increases: mandates, supplies, textbooks • Student enrollment growth • Federal Sequestration • Elementary class size in grades 4 and 5 2013-14 State Student Enrollment Projection 2013-14 State Enrollment Projection 12,256 2012-13 State Enrollment Projection 12,129 District Projected Enrollment Increase 127 CHCCS Student Enrollment (Graph) Local Continuation Budget Requests New School Opening Operating Request ■ Operating costs: Opening of Northside Elementary $1,915,208 State Mandates • Employer health insurance match increase — est. 5% increase $ 250,000 • State retirement match increase —from 14.23% to 14.59%$ 185,000 • Employee Salary increase — 1% for locally-paid staff $ 405,000 • Non-personnel cost increase for new students $ 38,607 Subtotal $ 878,607 Continuation of Current Services ■ Increase in State Discretionary Reduction (if Lottery funds are lost) $ 134,574 ■ Federal Sequestration — est. at 8% of Federal budget $ 464,000 ■ 4 Math coaches 9 - expiring RttT grant funds $ 280,276 ■ IFL Professional Development Contract $ 254,000 Subtotal $1,132,850 TOTAL OF CONTINUATION BUDGET REQUESTS $ 2,011,457 CHCCS Mandated Cost Increases 2007-08 to 2013-14 (Graph) Local Expansion Budget Requests Direct Support to Students ■ Reduce elementary class size to 1:26 average $ 500,000 ■ Reduce high school core class size to 1:26 average $ 350,000 ■ Provide schools with an increase in instructional supply budgets $ 40,000 ■ 4 Literacy coaches at middle schools $ 280,276 ■ Exceptional Children: 1.0 fte system level teacher - $70,069; 2.0 ftes system level teacher asst. - $69,620; 1.5 ftes PreK teachers - $105,104; 2.5 ftes PreK teacher assts. - $86,900; classroom supplies - $18,000; computers - $17,000; .5 psychologist - $37,871; PreK transportation - $15,000 $ 419,464 ■ 2 Teacher assts. For Section 504 students $ 69,520 ■ Information Technology: 3 ftes for new technology assts. — $135,000; salary retention adjustment - $18,000; $ 153,000 ■ Temp replacements for positions not covered by State $ 35,000 ■ Transportation — 3 ftes for additional bus drivers $ 97,554 Subtotal $1,944,814 Local Expansion Budget Requests Professional and Staff Development and Curriculum Support • World language professional dev., subs., and stipends $ 11,125 • English Language —Arts class 3D and instruct. Planning stipends $ 24,600 • Budget and Finance — staff dev. Funds for staff and bookkeepers $ 2,000 • AVID/AIG memberships, PD, curriculum materials $ 14,200 • Math staff dev., substitutes, stipends, summer materials $ 89,500 Subtotal $ 141,425 Safety and Security Related Requests ■ Security and Safety: Review and Support $ 120,000 Local Expansion Budget Requests General and Administrative Support • Facilities Management— Central Warehouse custodial supplies $ 135,000 • Human Resources — Recruitment advertising - $5,000; Recruitment events - $10,000 $ 15,000 • Superintendent's Office - Increase in attorney fees - $10,000; increase in Leadership Team workshop budget - $1,515; Superintendent's staff development— $1,080; Publications - $1,500 $ 14,095 Subtotal $ 164,095 GRAND TOTAL OF EXPANSION REQUESTS $2,370,334 Projected Local Budget Balance Total: Northside, Continuation & Expansion Increases $6,296,999 Less: Local Budget Reductions and Reallocations ($ 895,276) Subtotal $5,401,723 Less: Inflationary Increase — special district tax ($ 286,522) Add: Adjustment to other Local revenues $ 69,634 Amount of Requested Per Pupil Increase $5,184,835 Current budget$38,368,205 + $5,184,835 = $43,553,040112,234 students = $3,560 per pupil rate; $3,560- $3,167- $393 increase The Board's Budget Request assigns $3,222,913 in Local fund balance to balance the 2013-14 budget. State Legislation Unknowns • Governor's proposed budget: $1.1 million cut to teacher assistants • Charter Schools Bills: More funding shared with charter schools • Budget Flexibility and Class Size • School Safety Bill • Teacher Tenure/School Reform NC Average Teacher Compensation vs. National Average (Graph) State Teacher Compensation ■ 15 years to earn $40K ■ 2008-09 6" year teacher earns $36,670 ■ 2012-13 6" year teacher earns $31,670 ■ Co-pays continue to increase ■ Proposed increases in license fees Note: Based on Bachelors Salary Schedule Culbreth Science Wing • Long standing need, on CIP since 2002 - Existing labs lack water, space, windows, few hands on lessons, poor sequencing • Unsuccessful QSCB application 2012 • Cell tower revenue funded a single lab • Design funded with 12-13 CIP funds • BOE resolution requesting funding on Feb 7, 2013 Culbreth Science Labs ■ 6 Room Science Lab Addition • Addresses required code issues - Bathrooms, electrical, fire alarm, emergency generator, etc. • Provides small assembly space • Likely increases building capacity by 104...a 2 year delay for MS #5 said CHCCS will be opening a new school this year (Northside Elementary) which will increase costs. He said this makes the budget look a little worse, but this must be done due to the increase in students. He noted that the CHCCS 90% graduation rate is one of the highest in the state. Superintendent Forcella reviewed the positive impacts of financial support and said that there is still room for improvement in the achievement gap. He stressed the need for long term planning and professional development in achieving this. He said the FPG Dual-Language School is a first in the district, and this is almost like opening a second new school. He said that a task force has been set up to address safety plans for facilities and classrooms. He said the other piece of safety is to address the mental health piece of the puzzle, and to provide assistance to children who need help and might go unnoticed. Referring to the slide on Setting Priorities, Superintendent Forcella said that the goal is to continue the literacy coaching into the middle school to create a K-12 continuum. He said that when adding this, something has to be cut, and in this case it is In-school suspension and Middle School Teacher Assistants (TAs). He said efficiency reduction has to do with using staff more efficiently. He said examples of this include creating larger classes, combining classes, or having teachers teaching classes at multiple schools. Commissioner Dorosin referenced the slide on setting priorities and asked how many Literacy Coaches would be hired and how many TA's would be reduced? Todd LoFriese said that 4 coaches will be hired, and 8 teaching assistant positions will be lost. Commissioner Gordon asked about the new teaching models of interaction versus lectures and how this helps the lower achieving students. Superintendent Forcella said the students are engaged and involved in the learning process and this creates a much deeper level of thinking. He said not everyone is comfortable memorizing information and this model gives clear expectations and gives a better understanding of the context of the learning. Commissioner Dorosin asked if the literacy coaches are trainers for other teachers and Tom Forcella said yes, these coaches are training adult teachers in this teaching model. Todd LoFriese picked up the PowerPoint presentation on page 3 with the slide on 2013-14 Budget Drivers and reviewed the remaining slides. Commissioner McKee said the sequestration rates were different between the two school systems. Todd LoFriese said the there has been a lot of discussion about the class sizes in grades 4 and 5, where there are some classes with 30-31 students. He said this is a direct result of discretionary reductions from the state. He said the district reduction of$3 million equates to 50 teaching positions that the schools would otherwise have. Todd Lofriese reviewed the Continuation Budget Requests and said CHCCS are in the same position as Orange County in terms of the impact of sequestration, and there is an estimated 8% reduction reflected in the budget. He noted the last line on the Projected Local Budget Balance slide and said that this is based on the Board continuing to assign the fund balance at an increased level of$3.2 million. He said this is likely the last year that this will be possible. He said it is unknown how the Teacher Tenure/School Reform will affect the ability to recruit teachers. He noted that NC is currently 47th in the nation in teacher pay, trailing the average by nearly $10,000. He noted that experienced teachers make $5000 per year less than 4 years ago. Commissioner McKee noted that the sequestration rates were different between the two school systems. Todd Lofriese said the CHCCS number was recommended by the finance officer and Superintendent Rhodes said OCS based this number on an estimate average of districts that ranged from 4% to 11%; and a middle ground was chosen. Commissioner McKee noted the OCS $17,000 item under exceptional children and asked for elaboration on the status of computers in the classrooms. Superintendent Forcella said the goal is to reach a two to one ratio for computers, which is required for testing. He said the biggest issue is making sure all students have access. He said there is also a community based program to buy computers for children who don't have them. Todd Lofriese said that $17,000 figure is specifically for exceptional children and may be specialty technology for the hearing or visually impaired population. Commissioner McKee he wanted to make sure that internet access is not exclusive to the rural parts of the county. Chair Jacobs said Congressman Price asked the districts to identify the consequences of sequestration so that he could articulate its impact on the residents. Commissioner Pelissier asked for an explanation of how teacher salaries decreased. Todd Lofriese said these reductions relate to hiring teachers. He said the General Assembly has frozen wages and the steps in wages. This has resulted in compression and teachers have stayed at the same rate for years. He said this means that many seasoned and new teachers have the same salary. Commissioner Pelissier asked for an explanation of Northside and the high costs to open a new school. Todd Lofriese said there are a variety of operational costs from utilities to custodial and cleaning support. He said the state also does not fully fund assistant principals in all schools. The supplement pay for additional principal and assistant principal comes from local funds. He said many teacher assistants are locally funded because the state does not fund 1:1 teacher assistants in grades 1-3. He said local funding is also needed for support services, such as for exceptional children program facilitators, social workers, and guidance counselors. Chair Jacobs noted that Page 2.8 in CHCCS budget has the cost breakdown. Commissioner Pelissier asked if these local funded positions pertain only to the elementary level. Todd Lofriese said the great majority are elementary staff. He said this budget is in line the budget for the opening of Morris Grove Elementary. Commissioner Dorosin clarified that the salary compression figures do not include the local supplement. Todd Lofriese said the county funds directly support the local supplement, so this is a percentage on top of the salary, dependent on years of experience. Chair Jacobs said the message he is hearing is, when it comes to public education, North Carolina is becoming the stingiest state. 2. Other Discussion Items: Pre-K, Legislative Update, and Culbreth Science Wing Debt Financing Scenarios Pre-K discussion moved to end of meeting. Legislative Update Both school boards touched on this in their Power Point presentations. Superintendent Rhodes said the greatest concern to the OCS board is the charter schools legislation. He said this legislation will allow charter schools access to district budgets. He said there have been court cases in which North Carolina School Districts were required to pay out fund balance and other reserves to Charter Schools. He also mentioned the virtual Charter School potentials. Superintendent Rhodes referenced bills to allow homeschoolers and private schoolers to play on public school sports teams and participate in extra-curricular activities. He said this is an example of inequities that exist. He noted that charter schools do not have to pay the state sales tax. He said In Florida there is a movement to set up vouchers for public school students to go to other schools; and this is one of many examples of movements that he feels de-legitimize public education. He said the one size fits all reform models do not help all the districts. He said he has never seen this level of legislative activity associated with public schools. Commissioner Dorosin said he too believes that there is a movement to de-legitimatize public education. He said the vouchers and bills are designed to incentive people to leave public education. He said that the Charter Schools are not really a choice for everyone because there is no requirement for free and reduced lunch to be offered. He said these Charter Schools are more racially and socio-economically segregated than Public Schools and he expressed anger about what is happening to Public Schools and said the County needs to raise a collective voice to uncover what is happening. Superintendent Forcella said the governor's budget includes a reduction in teacher assistants that would equate to a loss of about $1 million for the district. Chair Jacobs said there will be more discussion of Charter Schools and some creative approaches to prevent the district from being a sitting duck for the raiding of funds. Commissioner Price asked both school systems to clarify what cuts are being made to teachers in the face of budget cuts. She asked if this will affect class sizes or course offerings. Todd Lofriese said both of these issues could be a reality. He said, with the discretionary reductions going back to state, the cuts equal over $3 million. He said this leads to the 30-31 student class sizes, as this reduction means 50 teachers less. Commissioner Price asked if this reduction has already taken place and if it will continue. Todd Lofriese said this reduction has been happening since the 2009-2010 school year. Superintendent Rhodes said there was a reduction of 33 teachers for OCS. Todd Lofriese said this has not just affected teachers. The district has returned funding for teacher assistants as well. He said there has been an attempt to use fund balances to fund these positions. CHCCS Chair Brownstein said the class size really does matter in the lower grades, and with the some of the bills in legislation there will be an effect on K-3. This will stretch teachers thin and impact school safety and behavior. OCS Chair Coffey said public schools struggle with educating the public about what is going on with their public education system. Chair Jacobs referenced the segregation occurring in schools in Mississippi and Alabama and how the voucher system will only worsen this situation. He agreed that there needs to be an effort to fight back against what is happening and to educate the public about the value of quality public education. Commissioner Price asked if anything has been done to support legislative efforts to help with the situation. Superintendent Rhodes said the CHCCS has passed several resolutions in opposition of many bills and Representative Foushee has been very supportive. Commissioner Price asked about the Board of County Commissioners sending a letter or resolution expressing their viewpoint on the situations. Chair Jacobs said this viewpoint was expressed at the legislative breakfast but a letter can also be sent. CHCCS Chair Brownstein said the legislative delegation is aware of this but their efforts have been frustrated. Commissioner Price suggested that a letter be sent to the governor and other counties be made aware of this effort in hopes that they join. Chair Jacobs suggested the board consider a petition at agenda review. CHCCS Board Member Gregory McElveen suggested that efforts to impact legislation should leverage the link to the business community. He said changes have an impact on the appeal of the state to those considering bringing jobs to here. Culbreth Science Wing Debt Financing Scenarios Chair Jacobs recognized the members of the public wearing yellow t-shirts in support of this science wing. Paul Laughton, with Orange County Finance Administrative Services, reviewed attachments D1 and D2 included in the packets. He said, at the last CIP work session, the Board of County Commissioners requested that staff bring back two scenarios in reference to the science wing addition. CHCCS has included this in the unfunded new school facilities section of their budget. He said that the CHCCS CIP calculates pay as you go funds, lottery funds, and article 46 sales tax funds. He said anything above that will be items that need financing and will be listed as unfunded. Paul Laughton referenced attachment D1 and the 15% annual debt service policy. He said this policy states that the county strives to maintain annual debt services cost at a level no more than 15% of general fund revenues. He reviewed how this amount is formulated and reviewed the numbers from the Total Annual Debt Service, which includes current debt service and stretches through a five year plan. He stressed that this is a planning tool and said that it is re-evaluated each year. He noted the projected growth of 1.5% each year until it goes to 2% in year 5. Paul Laughton said the projects listed on this sheet are those projects currently in the CIP. He said this sheet adds the Science Wing. He noted that the current recommended CIP reflects a $1.2 million dollar debt capacity overage in year 2017-18; however, with the Science Wing inclusion and all else remaining the same, this overage number grows to $1.74 million over debt capacity (15.89%). Paul Laughton referred to the salmon colored sheet- attachment 2D-which lists option 2. He said this option puts the science wing in the years the schools have requested. He said this also adds the science wing with 6 classrooms. With these classrooms added, CHCCS says the need for middle school #5 could be delayed for 2 years, until 2016-17. This option creates a debt capacity of 14.23%, which leaves $1.5 million in available debt capacity. He said these scenarios take the district through year 5; however the overage in year 6, for option 1, is $5.1 million and for option 2 the overage is $2 million. Paul Laughton said the district needs to look at how much debt can be taken on and how it looks outside of year 5. Paul Laughton said this debt is consistent with what has been requested with debt proceeds. He said that, realistically, Culbreth would do one time financing the first year, to total $4.9 million; and then middle school #5 would follow that project. He said the middle school is a $39.8 million project. He said all of this depends when the financing is done and the timing will change the debt capacity and the amounts of overage on the 15% debt capacity. Frank Clifton said the state created a new board a year ago that reviews debt separately from the LGC, who authorizes debt. He said projections for the general fund are conservative but not unrealistic. He said some of the lack of growth in the county's general fund budget is a result of state activity and is beyond the control of the county. He said the county could decide to move forward on the science wing, only to be required to defer something else in a couple of years. He said this just needs to be kept in mind when making decisions. Commissioner Gordon asked to see the last two slides from CHCCS. She noted that if the middle school is moved back two years, while putting the science wing in, it improved the scenario and debt service is now under the 15% level. She said the CIP is approved for 5 years and funded for the first year, and this proposal improves the debt service picture for the 5 year period. She re-visited the slide information showing this improvement in the debt service picture when compared with the manager's original CIP recommendations. Todd Lofriese said the last two slides provide a brief overview of history and some information about the proposed science wing addition. He reviewed the information on the PowerPoint slides as follows: Culbreth Science Wing • Long standing need, on CIP since 2002 - Existing labs lack water, space, windows, few hands on lessons, poor sequencing • Unsuccessful QSCB application 2012 • Cell tower revenue funded a single lab • Design funded with 12-13 CIP funds • BOE resolution requesting funding on Feb 7, 2013 Culbreth Science Labs ■ 6 Room Science Lab Addition ■ Addresses required code issues - Bathrooms, electrical, fire alarm, emergency generator, etc. ■ Provides small assembly space ■ Likely increases building capacity by 104...a 2 year delay for MS #5 CHCCS Board Member Jamezetta Bedford asked for clarification on the Cedar Ridge High School (CRHS) proposed wing, which is listed in 2015 on one CIP sheet and then as a need in ten years on SAPFO. Superintendent Rhodes said there are many sub-divisions coming on line; and OHS capacity had been downgraded significantly, so there is a request for this to happen. OCS Chair Coffey added that it was discovered that Hampton Pointe is not even on the radar for capacity and CRHS is already over capacity and Orange High has been reassessed. She said this will come sooner than originally thought and the district projections are standing. Chair Jacobs reviewed the location of Hampton Pointe and noted that the new apartment developments have not come online yet. OCS Chair Coffey said the district has not seen the CAPS sheets for these new developments. Craig Benedict said SAPFO projections are based on the students who show up in school as of November. He said there are five different models that project forward and are averaged all together. He said as soon as children come to school, projections are affected. He said that this means the wing for Cedar Ridge might be ten years out at one point, but it may be moved forward as projections change when students show up for schools. He said the models show there is not a need for new capacity in OCS schools, but that could very well change with the new development. Chair Jacobs asked about the $39 million for the new middle school and if this number includes land. Several people answered no. CHCCS Board Member Jamezetta Bedford asked if OCS has numbers that do not include the addition of CRHS. Paul Laughton said the addition was kept in because it was in the OCS CIP last year. He said this dialogue was continued due to student generation rates. He said the project has been moved back to year 3. Commissioner Dorosin asked about newer developments that are not being counted. He questioned, coming out of a recession period, how attuned the county is to new developments and how quickly numbers can be revised. Craig Benedict said there are two parts to the SAPFO process- 1. Projections based on historical patterns, and 2. The Certificate of Adequate Public Schools (CAPS) System, which estimates seats left in a school, and then uses a student generation rate assigned to a development type to gauge it against those seats. He said this is looked at when a development requests certificates of occupancy; and if necessary, the development will be asked to delay a certificate of occupancy to allow time for building the school. He said that spikes are handled very quickly with a technical advisory committee managing adjustments in the CIP. Commissioner Dorosin said he is encouraged that the science wing will delay the new proposed school, however he feels that there should be a constant awareness of the need to increase capacity. Commissioner Rich noted that Culbreth is not only building a new wing but is also upgrading an older school in a holistic manner. Todd Lofriese said there will not be a complete building renovation but there will be some upgrading as a result of the wing. CHCCS Board Member Greg McElveen asked about debt capacity. He noted that the manager's proposed CIP budget said, in Scenario 2, the debt capacity would be exceeded in year 6. He asked what happens after year 6. Frank Clifton said it is hard to say at this time. He said this wing project is an unfunded project that got into the system and there may be other unfunded projects that enter the system in the coming years. He said there is flexibility there from one year to the next, and the county is in good financial shape. There are just some issues with limits on when debt can be issued. He noted that for the past 4 years, taxes have not been raised, but debt has been issued. Clarence Grier said that in either scenario where the capacity exceeds 15% in year 6, the percentage would likely continue to rise after that. This is because there will likely be issues with bond rating and debt issuance. CHCCS Chair Brownstein asked if the current CIP has the same issues with overage. Frank Clifton said there are proposals to defer projects for a year or two at a time. CHCCS Chair Brownstein asked for clarification on the difference between the color sheets and the white CIP sheets. Frank Clifton said staff was asked to provide the two different scenarios and this was just a response to that request. CHCCS Chair Brownstein said the same problem seems to exist on both sets of papers. CHCCS Chair Brownstein asked where things go from here. Chair Jacobs said this will come back to the Board of County Commissioners for CIP discussions, and then there will be public hearings on the proposed budget. May 9th is the CIP work session and public hearings will be held on May 23 d and May 30th. Commissioner Price asked when the science wing would open, if it is funded. This was answered, August of 2014. Superintendent Rhodes said there is a need for auxiliary gym at CRHS. OCS Chair Coffey said this is scheduled for 2014. Chair Jacobs said projections are just projections and Orange County is projecting conservatively. He said a similar discussion was held in 2001 regarding a bond referendum proposal. Pre-K CHCCS Chair Brownstein said this conversation has gone on for the past two years to address having Pre-k in their elementary schools and its impact on capacity. She said the idea behind the draft resolution is to have something in writing about the district philosophy on the value of pre-k; and to create a consensus on decisions regarding capacity and when new schools need to come on board. Chair Jacobs noted several sheets at the Commissioner's places from the different schools, relating to pre-k numbers. OCS Chair Coffey said only one elementary school in the district has been built since the 1996 school construction standards, so this is the only school that allows for pre-k. The rest of the pre-k classes are absorbed by the current elementary capacity. Chair Jacobs said the issue is how to count these classrooms toward school capacity. He said some may feel that, by counting pre-k toward capacity, the county will rush too quickly to having to build another elementary school. He said there was no consensus among the three Chairs on how to finish the wording on the resolution because each of them came at it from a different position. CHCCS Chair Brownstein said the resolution is pretty factual, and then the meat of it is the last paragraph, which discusses how the issue will be addressed. Chair Jacobs said if no one has anything to add, this can be hashed out at school collaboration. CHCCS Board Member Jamezetta Bedford said that both school systems support reflecting reality and that schools are very much overcrowded when you count these pre-k classrooms. CHCCS Chair Brownstein said there is not a version of SAPFO with and without these classrooms. She said this would give a better view of the implications. She said this may be needed in the school collaboration meetings. Chair Jacobs said the Board is very supportive of Pre-K, but there is also not a mandate for the county to provide that space. He said if Pre-K is moved into the SAPFO numbers, then the schools start "bumping" into capacity issues and CAPS. He said he is skeptical at this point. Commissioner Dorosin said one issue is that these pre-k classes have fewer students than a first or second grade class, and classrooms are underutilized from a space standpoint. He asked if some pre-k classes are half days, and the answer was no. Commissioner Dorosin said one thing to consider is a designated pre-k center. He said some counties have this and it does not run up against SAPFO numbers. Chair Jacobs said there are three sites at Twin Creeks. He said there has been discussion about making one of these three sites into a joint Pre-K/administrative facility. He said there have been previous discussions about this; however parents felt it was better to have the pre-k spread throughout the elementary schools where they could move up into the elementary grades. Commissioner Dorosin said Pre-K is in a tenuous spot with the General Assembly and there are question marks about funding and how this will look six months from now. CHCCS Chair Brownstein said the other link to this is that the new school construction standards require a classroom for pre-k. This means there will be some adjustments needed if a stand- alone site is chosen. Chair Jacobs said numbers could be run for classrooms and for students to see how it all works out. This can then be discussed at the next meeting. He said the pre-k classrooms are an adjunct to what is going on in the building. He also addressed the safety implications of having kids apart from the main building. CHCCS Board Member Mia Burroughs asked if there can be agreement on philosophy, without inclusion of the last paragraph. Chair Jacobs suggested agreement on the "whereas" statements with more time to digest the therefore statements. Commissioner Dorosin noted the third whereas, which mentions co-location and he asked for clarification on what this means. He feels that there needs to be broader thinking. He suggested that the co-location sentence be removed. Commissioner Rich clarified that schools built now are required to have pre-k on campus and said that this would have to be changed. CHCCS Board Member Mia Burroughs said she is comfortable taking that sentence out. A motion was made by Commissioner Dorosin, seconded by Commissioner Gordon to approve the three "whereas" paragraphs in the draft resolution (with the removal of sentence proposed by Commissioner Dorosin) below: Whereas, children who are at risk for school failure are more likely to succeed in school and in later life if they attend a high quality preschool. North Carolina and national studies have shown repeatedly that good preschool programs give children long term advantages in cognitive and social development. Studies that track preschool graduates into adulthood demonstrate positive impact on graduation rates, employment and arrest records. Whereas, the public schools in Orange County provide pre-kindergarten programs for three and four year olds in order to improve the participants' success throughout their school careers. This investment is good for the individual students and should also reduce the districts' expenditure for specialized intervention services. Whereas, the school systems are an integral part of a network of preschool providers in Orange County who are willing to accept subsidies for low income children provided by the state and federal preschool programs. The schools help their preschool students' transition successfully to kindergarten by aligning their curriculum and services with the rest of the public school program. Schools include their Pre-K programs in their efforts to evaluate what works and to continuously improve outcomes for children. Commissioner Pelissier said she thinks this isn't an opinion issue but is about what works best. She said there needs to be information put forth to thoroughly discuss this issue. Commissioner Dorosin said he is specifically addressing the older schools, where this is an issue for the schools. Commissioner Pelissier said, even with the older schools, the basis for decisions should be based on information about what really works best in Pre-K. Commissioner Gordon said the main point is that Pre-k education is valuable. Chair Jacobs said on June 12 at 10am there will be another school collaboration meeting and this will be addressed further at that time. . VOTE: UNANIMOUS—Board of County Commissioners Commissioner Pelissier said it would be helpful to run some scenarios to see how this issue affects debt capacity. Commissioner McKee said there was no discussion on the "therefore be it resolved" paragraphs and he feels the Board of County Commissioners needs to address this sooner rather than later. 3. Overview and Analysis of Education Funding Provided to the Chapel Hill Carrboro City Schools and Orange County School Districts in Relationship to the 48.1% Funding Target Clarence Grier reviewed the history of the 48.1% Funding Target, as listed in the abstract. He said that in 1999-2000 the Board of Commissioners and both school districts got together to decide on consistent funding options. He reviewed the funding information as listed in attachment a. He said that in half of the years since the funding target was implemented, the schools have been funded above the funding target and the other half fell below the target. He said the property tax rate increases in 2000 and 2008 have also been used to fund the school districts at 48.1%. He noted that the General Fund Budget has gradually decreased since 2008. He reviewed the inclusions in operational funding and the numbers on attachment B. Clarence Grier reviewed attachment C and noted that even though there may be enough debt capacity to add a school, the debt service has an effect on the operational funding. Clarence Grier said when looking at educational funding by source, it can be noted that ,back in 2000, the state was the largest funder of education. Moving forward to look at 2013, the county portion equates to about $15-16m for school funding. He said that as state funding has decreased the county's portion has increased. CHCCS Board Member Mike Kelly asked Clarence Grier to add the school boards budget to the numbers. Clarence Grier noted that enrollment has increased by 23% since 2000. OCS Board Member Debbie Piscitelli asked if new facilities coming online could negatively affect the 48.1% figure for the opposite school system. Clarence Grier said yes, it could and said this goes both ways. Frank Clifton said he sees a reliance on the 48.1% funding by both school systems growing and he said that school debt impacts operation. He said that the debt comes on one year and then the payments start the next year. He said that the operational dollars are lower once the debt comes into play. This has been lessened by lower interest rates, but this will change as rates rise. He said this needs to be looked at. Chair Jacobs asked Clarence Grier if the annual per pupil allocations can be added to the sheet, and Clarence Grier said yes. CHCCS Board Member Jamezetta Bedford asked if it is it still true that residential growth does not pay for itself, and Frank Clifton answered yes. She asked if there has been any progress with economic development, and Chair Jacobs answered yes. CHCCS Board Member Mike Kelly referenced Debbie Piscatelli's comment regarding the impact of new schools and asked how this can be managed. CHCCS Board Member Mia Burroughs said there is growth in CHCCS and building out is not so far away. She said there is more room for growth in Orange County and this is a challenge that can go either way. CHCCS Board Member Jamezetta Bedford referenced the great amount of older schools in both systems and said these needs will be significant and there is not sufficient money to cover them. She said there have been studies about this and it is just now being touched on. She said this needs to be in the back of peoples' minds as it will need to be addressed. Chair Jacobs said there are many forms of equity, and one system should not receive all of the funding while the other district sits and watches. He said that $1 million went to Orange High and then the rest of the money went to the Chapel Hill School System. He said that there needs to be continual discussion to prevent putting any school system at a disadvantage. OCS Chair Coffey expressed appreciation for the opportunity to come forward to discuss this with the Board of County Commissioners. She expressed a desire for more collaboration and input for future agendas for these joint meetings. The meeting was adjourned at 10:08 pm. Barry Jacobs, Chair Donna S. Baker Clerk to the Board