HomeMy WebLinkAboutAgenda - 03-20-2007-AGENDA
BOCC Budget CIP Work Session
March 20, 2007
Meeting — 7:30
Southern Human Services Center
Chapel Hill, NC
(7:30— 10:00) 1. Capital Funding and Budget Update
1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: March 20, 2007
Action Agenda
Item No.
MIMEUEMN��
PUBLIC HEARING: (Y/N) No
ATTACHMENT(S):
Attachment 1. June 23, 2005 Capital INFORMATION CONTACT:
Funding Policy Donna Coffey, (919) 245-2151
Attachment 2. Capital Investment Plan
(CIP) Revenue Projections, Fiscal Years
2006-07 through 2009-10 -
Attachment 3. Lottery Bill Research
Report (As Compiled by the NC
Association of County Commissioners)
Attachment 4. Estimated Land Transfer
Revenue (As Compiled by the NC
Association of County Commissioners)
PURPOSE: To receive information related to the capital and annual operating budgets.
BACKGROUND: Over the last few months, staff has provided to the Board, various items of
interest that may potentially affect the development of either the upcoming 2007-17 County
Capital Investment (CIP) plan, the 2007-08 Annual Operating Budget, or future years' budgets.
Examples of recent updates include discussions related to the anticipated decrease in projected
revenues from the North Carolina * Education Lottery along with the General Assembly's interest
in providing local property tax assistance to taxpayers throughout the State. Both of those items
would have negative impacts on the County's budget. Tonight's topics would continue previous
dialogues.
Topics anticipated for discussion include:
• School Capital Needs — The County Manager has invited the Chapel Hill Carrboro City
and the Orange County Boards of Education and .their Superintendents to discuss their
future capital funding needs with Commissioners.
• County Capital Funding Policy — Continuing earlier discussions related to the CIP and
County capital needs, the Budget Director plans to review how the County Capital
Funding Policy is operationalized and the Schools and County pay -as- you -go capital
funding streams are calculated.
• Legislative Items of Interest — Attachments 3 and 4 of this agenda abstract offer
information pertaining to pending General Assembly lottery legislation and land transfer
revenue. This information was received by the Budget Director at a recent North
Carolina Association of County Commissioners Public Education Steering Committee
Meeting.
FINANCIAL IMPACT: Financial impacts are included in the background information above.
RECOMMENDATION (S): The Manager recommends that the Board of County Commissioners
discuss the information presented in this agenda package and at the work session and provide
staff with direction with regard to capital funding.
M+e c h me 4
1 ITI-TRAM
UPDATED 062305
*RANGE COUNTY BOARD OF COMMISSIONERS
PROPOSED
CAPITAL FUNDING POLICY
Preamble
This capital funding policy is the product of extensive analysis and deliberation. It is
intended to reflect greater priority than there has been historically on providing funding for
County projects, with particular emphasis directed at enhanced upkeep of existing County
facilities. The policy reflects the implementation of the Board of Commissioners'
resolution of November 16, 2004 that the Board "does hereby adopt in principle a policy of
allocating a target of 60 percent of capital expenditures for school projects and 40 percent
of capital expenditures for county projects over the decade beginning in calendar year
2005': This policy continues the County's principle and historical practice of ensuring that
all School and County related debt service obligations are funded before any other School
or County capital funds are allocated for other purposes.
Planning Period
During each fiscal year, the Board of Commissioners shall adopt a ten year Capital
Investment Plan (CIP). The ten -year plan for long -range capital funding shall include
anticipated County capital expenditures costing $25,000 or more (excluding equipment)
and anticipated school capital expenditures costing $50,000 or more (excluding
equipment). Equipment costing $5,000 or more can be considered as part of the Capital
Investment Plan, but may also be considered for funding through recurring capital
appropriations. The first year of the adopted ten -year Capital Investment Plan shall be
incorporated into the next annual operating budget recommended by the County Manager.
County and School recurring capital needs will be identified and reviewed during each
annual operating budget cycle, and recurring capital appropriations will be approved by the
Board of Commissioners as an element of each annual Orange County Budget
Ordinance.
Sources of Funds
The County will allocate the following sources of funds for County and School debt service
and long -range and recurring capital:
• All proceeds from the Article 40 and Article 42 half -cent sales taxes.
(The North Carolina General Statutes require that 30 percent of the Article 40
(NCGS§ 105 - 487(x)) and 60 percent of the Article 42 (NCGS§ 105- 502(a)) sales tax
revenue be earmarked for public school capital outlay as defined in NCGS §105 - 426(1)
or to retire any indebtedness incurred by the county for these purposes)
• School Construction Impact Fees for each school system.
• Public School Building Capital Fund annual allocations from the State of North
Carolina.
• The equivalent of the revenue estimated to be produced each fiscal year from 4 cents
on the countywide ad valorem tax rate.
(This 4 cent rate may, but need not, be adjusted with each quadrennial revaluation to
a "revenue neutral' earmarking)
UPDATED 062305
• Property tax revenue sufficient to pay all debt service on remaining 1988, 1992, 1997,
or 2001 bonds, or refinancings thereof, as well as alternative financing programmed in
the debt issuance schedule approved by the Board on May 5, 2004 and any
subsequent updates to that schedule as the Board may approve.
Debt Service
All County and School related debt service obligations will be funded prior to allocation of
programmed funding for any other capital purposes.
All proceeds from annual allocations of North Carolina Public School Building Capital
Funds will be earmarked explicitly to pay for eligible school debt service.
Orange County Schools impact fees will be earmarked explicitly to pay for debt service on
projects that involved the construction of new school space in the Orange County Schools
system. Chapel Hill-Carrboro City Schools impact fees will be earmarked explicitly to pay
for debt service on projects that involved the construction of new school space in the
Chapel Hill-Carrboro City Schools system.
Allocation
With the exception of the revenues earmarked for School and County recurring capital and
the Construction Management function, the net proceeds of all programmed revenue
sources after debt service obligations have been satisfied will be allocated on the basis of
60% to schools and 40% to the County.
Capital funding for each ten year capital planning period will be allocated between the two
school systems based on certified student membership as of November 15 each year.
Capital Project Ordinances — Form and Purpose
All funds allocated to capital projects are to be accounted for in a Capital Project Fund as
authorized by a Board of County Commissioner approved Capital Project Ordinance.
The Capital Project Ordinance will include a detailed break down of each major cost
category related to the project.
In accordance with the Board of County Commissioners November 2000 adopted "Policy
on Planning and Funding School Capital Projects", whenever School capital project bids
are either higher or lower than originally projected, or any other factor affecting the project
budget occurs, the affected school system is expected to work with County Management
and Budget staff to present revised capital project ordinances for adoption by the Board of
Commissioners. The same expectations shall be applicable for changes to County Capital
project budgets.
Community Use of Schools
It is the intent of the Board of County Commissioners to evaluate each new proposed
school in both School Districts for joint community use opportunities, including, but not
limited to, park and recreation use.
Recurring Capital
As outlined in the "Sources of Funds" section of this policy, recurring capital funding for the
Schools and County will be based on the estimated proceeds of 4 cents on the annual
UPDATED 062305
General Fund property tax rate. The proceeds from 3 cents will be earmarked for schools,
with funds allocated to each school system for the next fiscal year based on each system's
respective share of the student membership as of November 15 immediately preceding
the next fiscal year.. Proceeds from 1 cent on the tax rate will be earmarked for County
recurring capital needs.
With regard to County Equipment and Vehicle acquisitions accomplished through the use
of third party financing, the Board of County Commissioners will determine the source of
funding to repay the associated debt service at the point that the Board approves the
financing arrangement.
Construction Management Function
Beginning with the 2005-06 fiscal year, the Board of Commissioners will appropriate
funding to establish a Construction Management function to oversee County and School
capital projects. In fiscal years 2005-06 through 2007-08, $100,000 will be allocated
annually to fund this function. The source of funding for the Construction Management
function will be split on a 60/40 basis with each school district sharing the schools portion
of funding (60%) in accordance with certified student membership as of November 15
each year. Each entity's share of this function will be deducted from its share of long-
range capital funding prior to allocating capital funds.
Schools Adequate Public Facilities Ordinance
Orange County's Schools Adequate Public Facilities Ordinance (SAPFO) and Memoranda
of Understanding (MOUs) between the County and its municipal and school partners
establish the machinery to assure that, to the extent possible, new development will take
place only when there are adequate public school facilities available, or planned, which will
accommodate such new development. The Board of County Commissioners is committed
to the principle that new school space documented as needed through the annual SAPFO
technical review process will be reflected in the next adopted CIP, and will be funded so
as to be constructed to be available before the relevant level of service threshold is
exceeded.
Rescission
This policy rescinds the Orange County Board of Commissioners Capital Funding Policy,
as originally approved on December 7, 1996 and as amended on February 3, 1998.
I
n-
r
a)
c Rl
109
> E2
C
G
Ct
W3
f2
C6
CIL
cl�
cli
VS
Cl)
k
in
Eq U)
cli
fl%
N
Ci V
m 82
c ii
o
O
co c
IL
Ln
a)
10
to
=M
CL
e �
ca 12
LI, Lo
t. I
il 49
10
Iwo
7
co
S, Z
C4
W
0
m~
0:
m - I
r 2
-2
—
0 c 0 1182
:3
8
-E
ca P-
m
LL
o
r 0
U- -C!
-M
-6
CO
e
0
cn
0%
w
w
Ir
co
to
6% o
to
t
C;
>M9 ,
8
0
0 0
C)
t
a
a
In
CFO
2
IL w LOLL
_ =No e
z -0 IL
¢ ;E a E
o 1�
Lq Ba
O
ca
C4
r-:
C-4
C-4
N
(n
C11
F
ab
r
C"
co
tO
(0
6%
U)
0)
Cli
E
w
Ln
C
a
C%f
n
r%
cli
cli
Cli Ji
R.
C%j
Ln
c7i
N
N
Q
O
F
f
m U
clf
w
cli
!S
C6
t-r
cli
Cli
CY
(7
0
aD
Ct
CO
C IF
CN
Uq
L)
O
t
a
ui
LL
cli
d2
=M
CL
e �
ca 12
LI, Lo
t. I
il 49
>
IF (� 8�
7
i� z, 2 %V
S, Z
m~
0:
m - I
r 2
-2
—
0 c 0 1182
:3
8
-E
ca P-
m
LL
o
r 0
U- -C!
-M
-6
CO
e
0
Ir
0
t
>M9 ,
8
0
0 0
C)
t
a
0 a § -R
2
IL w LOLL
_ =No e
z -0 IL
¢ ;E a E
� �
f ��
05 1 .
..
Bill: HBg
Sponsors: Church (D86); Goforth (D115); Rapp (D118)> Harrell, 3. (D90)
Title: SCHOOL CAPITAL FUND FORMULA/LOTTERY PROCEEDS
Summary: An Act to Change the School Capital Construction Formula in the State Lottery Act to
Provide for Distribution of All the Funds Based on Average Daily Membership.
History: O2/12/2OO7-H Withdrawn fr6mcommittee.
02/12/2007 - H Re-referred To House Committee On Education and, if favorable, To Corn
on Finance.
Position: Neutral
Priority: Medium
Position: Neutral
Bill: HB152
Sponsors: Tolson (D23)> Wilkins (D55)
Title: STUDY LOTTERY PROCEEDS FOR CHARTER SCHOOLS
Summary: An Act to Authorize the Legislative Research Commission to Study Allowing Charter
Schools to Share in Lottery Proceeds for School Construction Purposes.
0iaxuxy: 02/13/2007-H Passed 1oLKeading,
02/13/2007 - H Referred To House Committee On Rules, Calendar, and Operations of the
House.
Bill: HB175
Sponsors: 6etzer(R89); Hilton (R96); Frye (R84); Dollar (R36)
Title: SCHOOL CAPITAL FUND FORMULA/LOTTERY PROCEEDS
Summary: An Act to Change the School Capital Construction Formula in the State Lottery Act to
Provide for Distribution of All the Funds Based on Average Daily Membership.
History: 02/14/2007 - V Passed 1st Reading.
02/14/2007 - H Referred To House Committee On Rules, Calendar, and Operations of the
House.
Position: Neutral
Bill: HB342
Sponsors: Allred (1164)
Title: LOTTERY SCHOOL CAPITAL FUND FORMULA
Summary: An Act to Change the School Capital Construction Formula in the State Lottery Act to
Provide for Distribution of All the Funds Based on Average Daily Membership.
History: 02/22/2007- M Passed 1st Reading.
02/22/2007 - H Referred To House Committee On Rules, Calendar, and Operations of the
House.
Bill: HB437
Sponsors: Tolson (D23);]erfus(DS9);Yongue(D46)
Title: TAX ON LOTTERY wDNNlNGS/COMM. COLL. EQUIP
Summary: An Act Appropriating the Tax Collected on Lottery Winnings for Community College
Equipment.
History: 03/01/2007 - H Passed 1sLReading.
O3/D1/20O7-M Referred To House Committee On Appropriations and, if favorable, ToCorn
on Finance.
Bill: HB461
Sponsors: Pierce (D48); Harrison (D57); Folweil (R74); Hurley (R70)
Title: LOTTERY ADVERTISING COMPLIANCE ACT
Summary: An Act to Prohibit Any State Lottery Advertising Related to High School and Collegiate
Sports.
History: 03/05/2007 - H Passed 1st Reading.
03/05/2007 - H Referred To House Committee On Finance.
Bill: SB2
Sponsors: Snow (D50)
Title: LOTTERY SCHOOL CAPITAL FUND FORMULA
Summary. An Act to Change the School Capital Construction Formula in the State Lottery Act to
Provide for Distribution of All the Funds Based on Average Daily Membership.
History: 02/12/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
Position: Neutral
Position: Neutral
Bill: SB47
Sponsors: Pittenger (R39)
Title: LOTTERY PROCEEDS DO NOT SUPPLANT SCHOOL FUNDS
Summary: An Act to Ensure that Lottery Proceeds Earmarked for Local School Administrative Units are
not Used to Supplant Existing Funding.
History: 02/12/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
Position: Neutral
Bill: SB86
Sponsors: Pittenger (R39)
Title: CHARTER SCHOOLS GET LOTTERY FUNDS
Summary: An Act to Allow Charter Schools to Share in Lottery Proceeds on the Same Basis as Other
Public Schools.
History: 02/12/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
Position: Neutral
Bill: SS469
Sponsors: Shaw (D21)
Title: ADDITIONAL RESOURCES /LOW- PERFORMING SCHOOLS
Summary: An Act to Provide Additional Resources for Lowperforming High Schools.
History: 03/05/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
Bill: SB495
Sponsors: Jones, Ed (D4)
Title: LOTTERY EMERGENCY SCHOOL REPAIRS /RENOVATIONS
Summary: An Act to Set Aside a Portion of Lottery Proceeds for Emergency Repairs and Renovations
in Lowwealth Counties.
History: 03/06/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
Bill: SB518
Sponsors: Rand (D19)
Title: LOTTERY ACT CHANGES
Summary: An Act to Make Various Changes to the North Carolina State Lottery Act.
History: 03/06/2007 - S Referred To Senate Committee On Appropriations /Base Budget.
end-
Estimated Land Transfer Revenue
Estimated Land Transfer Revenue
Based on 2005 -2006 figures
Based on 2005 -2006 figures
Estimated
Estimated
1% Transfer
1% Transfer
Counties
Fee
Counties
Fee
Alamance
8,129,410
''
M1 '
4, r'
i� } ; ;'
F '''Y
(
' 4
'`
i ,._` i;
'Nash
,
`_ ', <'
' 4;
f
n
, `F z.!
4
=f
`:
i,
in` F
Johnston
11,241,240
Alexander
Alleghany
1,128,290
1,086,390
Jones
Lee
229,460
2,395,870
.Anson
Ashe
669,620
2,816,080
Lenoir
970,970
Lincoln
5,775,820
Avery
35332,220
Macon
556745010
Beaufort
2,782,740
Madison
2,075,040
Bertie
532,580
Martin
416,270
Bladen
783,510
McDowell
2,030,790
Brunswick
35,103,390
Mecklenburg
111,954,595
Buncombe
Burke
24,736,630
2,636,030
Mitchell
1,213,120
Montgomery
1,782,420
Cabarrus
17,152,410E
Moore
8,110,725
Caldwell
3,042,640
6,021,010
Camden
690,410!
New Hanover
32,699,930
Carteret
Caswell
15,655,170`'
474,160
Northampton
1,304,430
Onslow
11,246,020
Catawba
8,465,310
Orange
10,033,850
Chatham
6,679,960
Pamlico
2,003,320
Cherokee
4,229,100
Pasquotank
3,035,930
Chowan
970,460
i Pender
7,237,910
Clay
2,357,030
Perquimans
1,239,800
Cleveland
2,899,920"
Person
2,120,260
Columbus
1,109,950;
Pitt
8,809,950
Craven
7,576,000
Polk
2,729,230
Cumberland
14,779,2408
Randolph
4,580,700
Currituck
4,916,560
Richmond
1,151,060
Dare
10,797,190
„Rockingham
f
?i =Scotland
,' ;
`; rjra
1
r.z3Swain
,`
-Union
S's' '
'';..;, {Warren
`;
, 4ij
;Wayne
Att
1
?
Robeson
1,924,590
Davidson
6,080,670G1r;r,
2,789,080
Davie
2,540,510
Rowan
4,938,580
Duplin
1,667,030
Rutherford
4,645,120
Durham
25,704,913
Sampson
1,108,760
Edgecombe
1,342,950
881,780
Forsyth
20,739,310
Stanly
2,034,470
Franklin
3,342,190
Stokes
1,365,300
Gaston
9,297,260
Surry
2,156,010
Gates
321,410!,'';
1,686,400
Graham
633,040
Transylvania
4,072,210
Granville
2,632,400
Tyrrell
2,066,670
Greene
Guilford
299,070
33,990,400 ('
Vance
24,054,250
7,628,820
Halifax
1,530,210
Wake
100,522,050
Harnett
4,694,240
1,327,050
Haywood
5,617,240
Washington
928,420
Henderson
10,535,060 i
Watauga
7,331,080
Hertford
491,200('
3,564,220
Hoke
2,071,870
ilkes
2,463,370
Hyde
579,790
Wilson
2,831,500
Iredell
17,139,640
Yadkin
719,700
Jackson
9,042,370 �uA
Yancey
2,002,750
Column: total:
345,825,173
Column total:
431,125,910
Grand total:
776,951,083
Detail may not add to totals due to rounding