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HomeMy WebLinkAboutAgenda - 06-13-2017 - 2. Continue Discussion and Prioritization of FY 2017-22 Capital Investment Plan Projects ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: June 13, 2017 Action Agenda Item No. 2 SUBJECT: To Continue Discussion and Prioritization of Capital Projects in the Manager's Recommended FY 2017-22 Capital Investment Plan (CIP) DEPARTMENT: County Manager and Finance and Administrative Services ATTACHMENT(S): INFORMATION CONTACT: Attachment 1: FY 2017-22 Manager Bonnie Hammersley, (919) 245-2300 Recommended Capital Investment Plan Travis Myren, (919) 245-2308 Previously Provided Under Separate Gary Donaldson, (919) 245-2453 Cover—Also Available Online: Paul Laughton, (919) 245-2152 Manager Recommended FY2017-22 County Capital Investment Plan http://www.orangecountync.gov/departme nts/finance and administrative services.p Attachment 2: FY 2017-22 Capital Investment Plan Alternative 1 (Presented at the May 9, 2017 Work Session Attachment 3: FY 2017-22 Capital Investment Plan Alternative 2 Attachment 4. Davenport and Company County Tax Supported CIP Discussion Materials PURPOSE: To continue discussion and prioritization of Capital Projects in the Manager's Recommended FY 2017-22 Capital Investment Plan. BACKGROUND: On April 4, 2017, the Manager's Recommended FY 2017-22 Capital Investment Plan (CIP) was presented to the Board of County Commissioners (See Attachment 1). The Five-Year Plan includes County Capital projects, School Capital projects (including Chapel Hill-Carrboro City Schools, Orange County Schools, and Durham Technical Community College — Orange County Campus), as well as Proprietary projects (including Water and Sewer, Solid Waste Enterprise Fund, and Sportsplex Enterprise Fund). The projects listed in the Manager's Recommended FY 2017-22 CIP totaled $274,423,538, with Debt Capacity Ratios (Debt Service to General Fund revenues) ranging from 12.8% in FY 2017- 18 to 17.4% in FY 2021-22. The County has a Debt Management Policy which states, "The County will strive to maintain its annual debt service costs at a level no greater than fifteen percent of general fund revenues, including installment purchase debt". This policy is consistent with the Government Finance Officers Association best practice. At its May 9, 2017 work session, the Board reviewed and discussed County staffs attempt to help remedy exceeding its policy and/or addressing the cash flow shortfall by delaying or removing County Capital projects until they can be funded within the parameters of the adopted policy. Also, consistent with Year 1 of the Manager's Recommended FY 2017-22 CIP, it includes substituting pay-as-you-go funds for school projects to debt financing in Years 2-5. The following are the adjustments made to County Capital projects, as reflected in FY 2017-22 CIP Alternative 1 presented at the May 9, 2017 work session (See Attachment 2): • Parking Lot Improvements - $1,625,000 moved from Year 5 to Year 6 related to OPT/ AMS North and Passmore Center improvements; and removed $300,000 for Efland- Cheeks Community Center as it is included in the construction of a new Efland-Cheeks Community Center in Year 3. • Southern Orange Campus Expansion - changed funding source to $3,269,500 in Medicaid Maximization funds for the Health clinics portion, and $1,555,500 in debt financing. • Information Technology Fiber Connectivity— moved $1,045,675 out of both Years 2 and 3 to Years 6-10. • Information Technology Governance Council Initiatives — removed $500,000 in Years 2 and 4. • EMS Substations — moved $700,000 from Year 3 to Year 5; moved $1,500,000 from Year 4 to Years 6-10, and moved $600,000 from Year 5 to years 6-10. • Orange County Radio/Paging System Upgrades — removed $1,400,000 as there are current funds within this project to cover this expense. • Register of Deeds Automation — removed $400,000 for the software system purchase as there as current funds within the Automation and Enhancement Preservation Fund to cover this expense. • Millhouse Road Park — moved $300,000 from Year 2 to Year 4, and moved $6,400,000 from Year 3 to Year 5. • Northeast District Park — moved $350,000 from Year 3 to Year 5, and moved 7,650,000 from Year 4 to Years 6-10. Tonight's discussion will be focused on additional changes to the CIP as a result of direction the Board gave to staff during their discussion and prioritization of the CIP at its May 9, 2017 work session. The following are the additional adjustments made to County Capital Projects, as reflected in FY 2017-22 Alternative 2 (See Attachment 3): • Orange County Radio/Paging System Upgrades — moved a total of $12,300,000 from Years 2 through 5, to Years 6-10. • Durham Tech Community College (Orange County Campus) — moved a total of $20,000,000 from Years 3 through 5, to Years 6-10 related to the proposed new Health Technology Building. Also, since the May 9, 2017 work session, staff has received bids for the Buckhorn EDD — Efland Sewer to Mebane, Phase 2 Extension project and the following adjustment can be made: • Buckhorn EDD — Efland Sewer to Mebane, Phase 2 Extension (Proprietary Project) — remove $1,400,000 in Year 1 as it is no longer needed based on recently received project construction bid. Note: this project is funded with Article 46 Sales Tax proceeds so there is no impact on the County Tax Supported debt affordability and capacity. In addition, adjustments have been made to the School Capital Projects in regards to the FY 2017-18 budgeted ADM percentages, as well as budgeted Article 46 Sales Tax proceeds, to be consistent with the FY 2017-18 Manager's Recommended Operating Budget. Note: the FY 2017-22 Capital Investment Plan was presented prior to the presentation of the FY 2017-18 Manager's Recommended Operating Budget. Also, at the June 13, 2017 work session, staff will provide information related to capital projects which have additional/new revenue, potential partner cost sharing, and/or operational savings. The County's financial advisor, Davenport and Company, has prepared updated County Tax Supported CIP Discussion materials (See Attachment 4), which reflects the changes listed above as part of FY 2017-22 Alternative 2. FINANCIAL IMPACT: There is no immediate financial impact associated with discussion and prioritization of the FY 2017-22 Capital Investment Plan. It is a long-range financial planning tool with a financial impact in FY 2017-18, if the first year of the CIP is approved by the Board of County Commissioners with the adoption of the Annual Budget. SOCIAL JUSTICE IMPACT: There is no Orange County Social Justice Goal Impact associated with discussion of this item. RECOMMENDATION(S): The Manager recommends the Board review and discuss the prioritization of Capital Projects within the Manager's Recommended FY 2017-22 Capital Investment Plan and provide direction to staff.