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HomeMy WebLinkAboutAgenda - 02-04-20 6-a - Climate Action Tax Recommendations for FY 2019-20 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: February 4, 2020 Action Agenda Item No. 6-a SUBJECT: Climate Action Tax Recommendations for FY 2019-20 DEPARTMENT: Asset Management Services, Financial and Administrative Services ATTACHMENT(S): INFORMATION CONTACT: Climate Action Tax Projects and Scoring Brennan Bouma, (919) 245-2626 Report FY 2019-20 Paul Laughton, (919) 245-2152 PowerPoint Presentation PURPOSE: To: • Receive a report on climate change mitigation projects that could be funded through the FY 2019-20 Orange County Climate Action Tax, and the initial ranking of projects by the Commission for the Environment; and • Approve funding for the recommended Climate Action Tax projects for FY 2019-20 as outlined in the attached report. BACKGROUND: As part of the FY 2019-20 budget, the Board of Orange County Commissioners authorized an additional 1/4 cent property tax to provide an estimated $469,272 dedicated to accelerating climate change mitigation through the new Climate Change Mitigation Project in the Capital Investment Plan. When the tax was authorized, the BOCC stated that it would decide the final prioritization of projects to be funded, and the Board requested that the Commission for the Environment (CFE) provide feedback on prospective projects in advance of BOCC review. The BOCC has emphasized the need to consider racial equity first, so that those who benefit most directly from the proposed action are the people who most need assistance. With that in mind, the Board directed staff to develop a project scoring formula for the CFE to use while completing its initial project ranking. Staff developed an initial list of climate change mitigation projects and then created the requested scoring formula based on six (6) key criteria: • racial equity • emissions reduced • efficient use of funds • time to complete • ease of understanding/messaging/visibility • likelihood of success 2 After review by the County Manager, four projects focusing on climate actions outside of County operations were presented to the CFE at its meeting on November 11, 2019. The attached report includes the brief description of the projects and the assessment criteria that was given to the CFE, and lays out the CFE's scoring and ranking of the projects. In addition to the four projects created by staff, the CFE put forward a fifth project and scored it as well. Since these potential projects involve investments outside of County operations, all prospective partners such as the school districts and housing coalition organizers have received an initial notification and brief description of the initially scored projects. No detailed project discussions have occurred in advance of BOCC direction. FINANCIAL IMPACT: The Climate Action Tax is projected to generate $469,272 in funds in FY 2019-20 and the recommended projects are designed to use all of these funds. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goals are applicable to this item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. Local investments in energy efficiency and renewable energy in Orange County provides direct reduction of monthly energy bills and supports jobs and investments in clean energy technologies. These cost reductions lead to improved affordability for impacted households and ensure responsible stewardship of Orange County taxpayer resources. • GOAL: ESTABLISH SUSTAINABLE AND EQUITABLE LAND-USE AND ENVIRONMENTAL POLICIES The fair treatment and meaningful involvement of people of all races, cultures, incomes and educational levels with respect to the development and enforcement of environmental laws, regulations, policies, and decisions. Fair treatment means that no group of people should bear a disproportionate share of the negative environmental consequences resulting from industrial, governmental and commercial operations or policies. Reducing energy usage from the electric grid improves air quality impacts. Improving local air quality helps to protect the health of vulnerable populations in Orange County whose health is disproportionately affected by ground-level ozone and other emissions. ENVIRONMENTAL IMPACT: The following Orange County Environmental Responsibility Goal impacts are applicable to this item: • ENERGY EFFICIENCY AND WASTE REDUCTION Initiate policies and programs that: 1) conserve energy; 2) reduce resource consumption; 3) increase the use of recycled and renewable resources; and 4) minimize waste stream impacts on the environment. Investing in local climate change mitigation actions will conserve energy, reduce resource consumption, and increase the use of renewable resources. 3 • RESULTANT IMPACT ON NATURAL RESOURCES AND AIR QUALITY Assess and where possible mitigate adverse impacts created to the natural resources of the site and adjoining area. Minimize production of greenhouse gases. All of the proposed climate change mitigation projects will minimize the production of greenhouse gases, reducing Orange County's contribution to the adverse impacts of climate change on human and natural resources both inside and outside of the County. RECOMMENDATION(S): The Manager recommends that the Board • Consider the climate change mitigation projects that could be funded through the FY 2019-20 Orange County Climate Action Tax, and the initial ranking by the Commission for the Environment; and • Approve funding for the recommended Climate Action Tax projects for FY 2019-20 as outlined in the attached report. 4 ORANGE COUNTY NORTH CAROLINA February 4, 2020 Climate Action Tax Projects and Scoring Report FY 2019-20 Executive Summary: As part of the FY20 budget,the Board of Orange County Commissioners authorized an additional %cent property tax to provide an estimated $469,272 dedicated to accelerating climate change mitigation through the new Climate Change Mitigation Project in the Capital Investment Plan.This funding adds to the County's ongoing investments in clean technology and will support an expansion of climate change mitigation projects that build on Orange County's long history of sustainable actions. Following the Board's direction,the Orange County Commission for the Environment(CFE) has scored an initial list of climate mitigation projects using a formula that prioritizes racial equity.The full project scoring table completed by the CFE is included as Appendix A. Based on their ranking,the resulting project recommendations are listed in the following table: Project CFE Rank Cost Estimate Supplemental Weatherization for Low Income Households 1 $150,000 Countywide LED Campaign 2 $19,272 Rooftop solar-OCS 3 $150,000 Rooftop solar-CHCCS 3 $150,000 Total $469,272 Each project would be implemented to maximize project efficiency and minimize impacts on Orange County staff resources: • The weatherization project would focus primarily on providing additional energy efficiency assistance to Orange County residents with manufactured homes and homes already being repaired under existing programs in partnership with the Orange County Affordable Housing Coalition, Orange County Home Preservation Coalition, and Orange County Housing and Community Development. • The LED Campaign would connect with Orange County residents primarily through partnering with the Low Income Energy Assistance Program (LIEAP) of the Department of Social Services as well as the Family Success Alliance and its affiliated non-profits. • The rooftop solar projects for the schools are proposed to work through a grant program to provide the schools with flexibility while preserving the ability of the County to track progress and impact. History of County Sustainability Actions: These projects we propose to fund through the FY20 Climate Action Tax add to a long history of sustainability actions by Orange County. For decades, County staff have been safeguarding taxpayer and environmental resources by outfitting of County buildings with energy efficient technologies such as energy efficient lighting and HVAC systems, low-flow water fixtures, rainwater and greywater harvesting systems, and geothermal systems). Since 2015,the Orange County Sustainability program has pulled in P.O. Box 8181 * Hillsborough, North Carolina 27278 Telephone:919 245-2625 Fax:919-644-3001 5 more than $325,000 in grant funding to provide additional support for Orange County's investments in innovative sustainability projects. The County made an internal commitment in 2010 to aim for reductions in energy and water usage per square foot and was able to achieve a 22% reduction in energy use and a 39% reduction in water use by 2017. Here are some milestones in the recent history of Orange County's commitment to energy efficiency and renewable energy: • 2005 Greenhouse Gas Emissions inventory, 2017 update underway. • 2009 The Justice Center renovation includes County's first major geothermal installation, paving the way for 4 additional facilities to be retrofitted with geothermal HVAC systems by 2016. Combined,these systems allow the County to spend $37,000 less per year on energy bills and reduce the wear and tear on our HVAC systems. • 2010 Electric Vehicle charging network installed with 16 free chargers across 4 locations to incentivize a market transformation. • 2017 SolSmart Silver Designation attained including a solar rooftop feasibility study for County facilities, how-to checklist on solar installation for homeowners. • 2017 Commitment to Paris Climate Accord -26% reduction in total emissions by 2025. • 2017 Commitment to transition to 100% renewable energy countywide by 2050. • 2018 Triangle Regional Resilience Assessment— In 2018,the Town of Chapel Hill, City of Raleigh, City of Durham, Durham County, Orange County and the Town of Cary completed a joint assessment of our region's resilience to the hazards we all experience.This will guide plans that will help us withstand future anticipated disruptions. • 2019 Climate Action Tax—The Board of Orange County Commissioners levied a %cent property tax to accelerate priority actions on climate change. Current Projects: Orange County is building on its strong history of leadership in sustainability, and has been accelerating its efforts in several parallel projects: • Four new facilities which are currently under development will be the first County buildings to include rooftop photovoltaic systems:The Orange County Detention Center, the Environment and Agricultural Center, the Efland EMS sub-station, and the Parks Operations Base. The largest of these facilities will also be equipped with a highly efficient geothermal HVAC system. • The County has now committed to the 3rd party commissioning process for every major construction project to ensure new buildings are performing as efficiently as they were designed.This practice is estimated by the NC Department of Environmental Quality (NCDEQ)to pay for itself within 1-3 years. • More than $150,000 in grant funding has been secured in just 2018 and 2019 to support the County in procuring electric fleet vehicles and upgrading and expanding our network of electric vehicle charging stations. • The emissions for flights taken by all County staff as well as the car trips taken by the County's pool of CarShare vehicles will be offset by investments in documented carbon reduction projects being installed in North Carolina. Future Actions Recommended: Even with all of the current and previous projects,the Board of Orange County Commissioners (BOCC) recognize the need for further investment in energy efficiency to reduce our impact, renewable energy to power the necessary services we provide, and offsets for any unavoidable emissions. 6 Many current climate change mitigation projects will extend into the future, and entirely new opportunities will arise as well. With that in mind, on June 111h, 2019,the Board levied an additional cent property tax to provide an estimated $469,272 dedicated to accelerating climate change mitigation through the new Climate Change Mitigation Project in the Capital Investment Plan. During the approval of this Climate Action Tax,the BOCC requested that the CFE provide their feedback on initial project ideas in advance of BOCC review using a formula that prioritized racial equity.The BOCC has regularly emphasized the need to consider racial equity first, so that those who benefit most directly from the County's actions and investments are the people who most need assistance.This scoring formula was created to assess project ideas and a rubric reflecting that formula was used by the CFE to rank order the climate action projects (see Appendix A). Table 1: Orange County Racial Distribution and Poverty Status by Race 80% 70% 60% 50% 40% ❑Overall Racial Makeup 30% 20% ■Racial Makeup of Orange 10% Co. residents below 0% federal poverty level �a Source: U.S. Census Bureau, 2013-2017 American Community Survey 5-Year Estimates. Assessment Criteria: Projects were assessed by the CFE based on 6 key criteria. Bullet points below each criterion help to describe how the CFE was directed to apply them along with their relevant expertise. Racial equity is the criterion that holds the highest weight. Recent census figures show that racial minorities make up a more significant portion of the Orange County's residents below the federal poverty line (see Table 1), and disparities such as this make racial minorities more susceptible to the impacts of climate change. The following is the list of criteria and guidance provided to the CFE in scoring the projects: • Racial Equity(0 to 3pts): • Who benefits most directly? If it is likely to be a racial minority, score high. • Are there negative side effects of the project? If these may impact a racial minority, score low. • Emissions reduced (0 to 2 pts): • Consider quantity and location. • Higher scores should go to emissions reduced within Orange County, instead of at a power plant, due to greater health co-benefits. 7 • Efficient use of Funds(0 to 2 pts): • What is the return on investment? • Does this project build on successful existing programs or leverage other funding? • Will this project help to generate other funds or support future grant funding? • Time to complete(0 to 1 pt): • Projects that can be completed or show clear deliverables within one year should score higher. • Ease of understanding,visibility,and messaging(0 to 1 pt): • Projects that are easier to explain to Orange County taxpayers should score higher. • Likelihood of success(0 to 1 pt): • Projects that are within the direct control of the County and which have minimal complexity should score higher. Project descriptions: Supplemental Weatherization for Low Income Households: Due to the number of non-profit and for-profit service providers in the affordable housing field and the unique needs of each home, it is recommended that$150,000 within this capital project be directed by Orange County Housing and Community Development (OCHCD). After discussions with OCHCD, we recommend these funds be used by OCHCD in collaboration with established partners in the Orange County Home Preservation Coalition (OCHPC) and the Orange County Affordable Housing Coalition (OCAHC). In addition to utilizing the funds to increase the energy efficiency upgrades within the ongoing low- income housing rehabilitation work being completed by OCHCD, the department would work in partnership with the OCHPC to complete additional weatherization activities for low income households in Orange County.The OCHPC is a collaboration of non-profit and government entities engaged in rehabilitation of homes for low income seniors and people with disabilities in Orange County. Each organization has different programs and funding streams that can fund specific activities to rehabilitate homes for eligible households.The aim of the coalition is to bring together all agencies engaged in these activities to leverage funds and maximize outcomes. Each month, members meet to share their current caseloads and discuss what agency has capacity and funding to address needed repairs on a case-by- case basis. Because members are already assisting low-income families and individuals with a wide variety of repairs and improvements that reduce energy costs and improve the comfort level of residents, this additional funding would allow coalition members to add weatherization and energy saving up-fits that existing funding does not allow for.This would include activities like sealing cracks and ductwork, improving insulation, purchasing energy star-rated replacement windows and appliances, as well as more efficient HVAC systems. In recent years, the needs of the houses served have often been so extensive that the projects reach their funding limits before all energy efficiency upgrades can be completed.This project would provide additional resources for these energy efficiency investments to increase the future affordability of the home.This portion of the project funding is initially estimated to cover these additional energy efficiency improvements in 10-15 houses. Each of the service providers in the Coalition focuses on different elements of home repair and enhancement, but all would be able to enhance their energy efficiency improvements with additional funding .Partners in this effort include (and is not limited to) Orange County Housing and Community Development, Orange County Department on Aging, Rebuilding Together, Habitat for Humanity,the Jackson Center, and the Triangle J 8 Council of Governments.The coalition model is considered a best practice in the industry as it maximizes the efficiency of services, minimizing waitlists and administrative costs. In partnership with the both the OCHPC and the Orange County Affordable Housing Coalition (OCAHC) additional resources would assist with their mobile home preservation efforts.The energy efficiency performance of manufactured housing is often much lower than housing built on-site and therefore the energy cost per square foot is higher. At the same time, low-cost repairs such as resealing the seams and ductwork of a manufactured home can make a big improvement in energy efficiency and quality of life. This project will help continue targeted outreach, assessments and low-cost energy efficiency improvements, and help with early identification of any further needs that might be met through the County's existing Urgent Repair Program such as roof leaks and septic issues. Rooftop Solar for Schools: The rooftop solar projects proposed for each school district is proposed to work through a grant to provide the schools with flexibility while preserving the ability of the County to track progress and impact. Proposed requirements of the grant would be: 1.) That the solar projects maximize the purchase power of the grant funding by considering leasing of the solar panels in the arrangement laid out in 2017 by H.B. 589, and report to the County on the decision that was made to purchase or lease. 2.) The grantees must report the total solar energy generated as well as the percent of each facility's energy use that was served by the solar system.This would provide pressure for continued focus on energy efficiency along with the renewable energy. 3.) The grantees must have a monitor showing the live energy performance of their systems in a public location with a sign noting that the system was paid for by proceeds of the Orange County Climate Action Tax. Adding solar to the rooftop of County school buildings would currently allow the schools to leverage up to $75,000 in solar incentives per project from Duke Energy.Adding solar to the schools would provide the additional benefit of exposing hundreds of Orange County students and parents to the practical application of sustainable technologies. Countywide LED campaign (Proposed by the CFE): An important part of Orange County's efforts to combat climate change will be encouraging residents and businesses to adopt practices that reduce their greenhouse gas emissions.This pilot campaign would focus on retrofitting Orange County households with LED light bulbs. According to the US Energy Information Agency as of 2017 about 10%of all household electricity is used for lighting. For the same amount of light, LEDs use about 75% less energy than incandescent bulbs and 5-10% less than fluorescents, all while minimizing heat output and lasting 10 times longer.According to the US Department of Energy, currently about 15%of US residents have adopted LEDs. While the adoption rate is probably higher in Orange County,there would still be room for improvement making this easy-to- install energy-saving technology a good focus for an energy efficiency campaign. The project would be run by the Orange County Sustainability Program in partnership with several Orange County departments and non-profits that directly serve the County's low-income households. The Low Income Energy Assistance Program (LIEAP) run by the Orange County Department of Social Services helps Orange County residents to pay their energy bills in an emergency. This program is open to working with the Sustainability Program to distribute LED lightbulbs to those who request assistance. 9 The Family Success Alliance and their affiliated non-profit partners are also open to distributing LEDs through their networks. This proposed campaign would be rolled out in 3 steps: 1.) Create and test a pledge form- In order to receive bulbs, an interested resident would fill out a brief pledge that would allow them to indicate the number and type of bulbs that they pledge to replace with LEDs.The pledge form would be designed and tested to protect the identity of participants while allowing the program to estimate the energy efficiency impact.This form and other outreach materials would also suggest further low or no-cost ways to reduce energy bills such as moderating thermostat settings and changing air filters, and it would inform residents of other related utility savings programs such as OWASA's Affordability Outreach Program. 2.) Purchase bulbs—LED bulbs would be purchased in bulk to reduce costs and then stored until they are distributed. Ordering and distribution may occur in multiple rounds depending on the storage space available. 3.) Distribute—This program will leverage an existing program from Duke Energy to provide a box of 15 free LED bulbs every 3 years to each customer who requests one. With the assistance of staff administering the LIEAP and FSA as well as partnering non-profits, all applicable clients would apply for Duke Energy's free LEDs. If a household is served by Piedmont Electric, or if the bulbs Duke provides would not replace all the bulbs in the household,the County would provide LED bulbs. Non-profits and County staff who have access and permission to enter clients' houses may be able to provide a higher level of service and replace the bulbs directly. County staff will work with these partners to supply bulbs they need. Including the cost of promotional materials it is estimated that the LED campaign would cost just over $19,000 to serve up to 3,000 households. Based on initial data from the 2017 Orange County GHG inventory, retrofitting a household with LEDs could save 400-1000 kwh/year, reduce the electric bill by $40-$100/year, and reduce CO2e emissions by 300-700 pounds/year. Small hydropower feasibility study(*Not included in recommended projects due to low CFE ranking*): According to County engineer, Chris Sandt, Lake Orange may be a good candidate for the installation of a small hydropower generator.The upcoming spillway repair project funded in the CIP may be a good opportunity to leverage committed funds to install energy generation equipment. A 3rd party engineering study would help to confirm the total power output expected and the overall feasibility of this project. 10 Appendix A:Complete CFE Project Scoring Table: Ease of Efficient under- Likeli- Racial use of Time to standing hood of Equity Emissions Funds Com- and success Cost 0 to 3 Reduced 0 to 2 plete 0 messaging 0 to 1 Project Estimate is (0 to 2 pts) is to 1 t : (0 to 1 pt1: pt). Total Rank* Supplemental Weatherization for $150,000 3 1 2 1 1 1 9 1 Low Income Households Countywide LED $12,000 Campaign 3 1 2 1 1 1 9 2 Rooftop solar-OCS $160,000 2 1 2 1 1 1 8 3 Rooftop solar- $160,000 2 1 2 1 1 1 8 3 CHCCS Small hydropower feasibility study $30,000 1 1 1 1 1 1 6 4 Total (Max for 2019-20 is $512,000 $469,272) *All projects, including those that tied in their scoring and those that exceeded the FY20 funding limit were placed in rank order by CFE voting. Appendix B: Other projects that might be considered for future funding: These projects were not reviewed by the CFE, but as the County moves forward these and other ideas may be good candidates for elaboration and review: • Assisting OWASA in the development of a biodigester to make productive use of the waste gases at their water treatment plant that are currently flared. • Investments in resiliency for vulnerable communities as determined by the ongoing update to the Eno-Haw Hazard Mitigation Plan. • Energy Efficiency Grant Program or Revolving Loan Fund ORANGE COUNTY NORTH CAROLINA Climate Action Tax Projects FY20 Orange County Sustainability Program "FOR A GREENER ORANGE" 12 Background • Climate Action Tax approved for current budget • $469,272/yr. for additional climate action • Commission for the Environment scored and ranked projects • Requesting approval of recommended projects 13 History of Climate Action GEUTMERMAL HEAT PUMP • 2005 Greenhouse Gas Emissions inventory lo • 2009 Geothermal systems begin to be installed GEOTHERMAL LOOP FIELD • 2010 Electric Vehicle charging network installed • 2017 SolSmart Silver Designation SOLSMART S I L V E R • 2017 Commitment to Paris Climate Accord - 26% reduction in total emissions by 2025. ■ • 2017 Commitment to transition to 100% renewable energy E countywide by 2050. V • 2018 Triangle Regional Resilience Assessment • 2019 Orange County Climate Council and Climate Action Tax ORANGE COUNTY NORTH CAROLINA 14 History of Climate Action GEUTMERMAL HEAT PUMP • 2005 Greenhouse Gas Emissions inventory lo • 2009 Geothermal systems begin to be installed GEOTHERMAL LOOP FIELD • 2010 Electric Vehicle charging network installed • 2017 SolSmart Silver Designation SOLSMART S I L V E R • 2017 Commitment to Paris Climate A ord - 26% reduction in total emissions by 2025. 5 years ■ • 2017 Commitment to transition to 100% renewable energy E countywide by 2050. CEErs - ■ ■ • 2018 Triangle Regional Resilience Assessment • 2019 Orange County Climate Council and Climate Action Tax ORANGE COUNTY NORTH CAROLINA 15 Current Climate Work O • Greenhouse Gas Emissions Inventory (DOCCO �� ORANGE COUNTY update in final edits COMMUTER OPTIONS g phase Climate Action Planning in initial ' • Orange County Climate Council work underway r • Grant-funded fleet electrification work ongoing of�JaYORS F°R c Orange County Commuter Options program �� 00MIr� , s c. �r �r • Global Covenant of Mayors annual reporting • Climate Action Tax 16 Current Climate Work O • Greenhouse Gas Emissions Inventory (DOCCO �� ORANGE COUNTY update in final edits COMMUTER OPTIONS g phase Climate Action Planning in initial ' • Orange County Climate Council work underway r • Grant-funded fleet electrification work ongoing Orange County Commuter Options program �� 00MIr� , s c. • Global Covenant of Mayors annual reporting • Climate Action Tax L 17 Recommended FY20 Climate Actions CFE Scoring: 6 part formula prioritizing racial equity — Racial Equity (0 to 3pts) — Emissions reduced (0 to 2 pts) — Efficient use of Funds (0 to 2 pts) — Time to complete (0 to 1 pt) — Ease of understanding/visibility/messaging (0 to 1 pt) — Likelihood of success (0 to 1 pt) ORANGE COUNTY NORTH CAROLINA 18 RecommPnded FY20 Climate Actions Project CFE Rank Cost Estimate Supplemental Weatherization for Low Income 1 $150,000 Households Countywide LED Campaign 2 $19,272 Rooftop solar - OCS 3 $150,000 Rooftop solar - CHCCS 3 $150,000 Total $469,272 ORANGE COUNTY NORTH CAROLINA Recommended FY20 Climate Actions Supplemental Weatherization • If <50% of Area Median Income, 12% of all income spent on energy • Leverage ongoing partnerships: OCHPC, OCAHC • Coalition organizers notified of potential project Id ORANGE COUNTY NORTH CAROLINA 20 Recommended FY20 Climate Actions LED Campaign • LEDs can lower energy bills 7-10% and they last 10 times longer • LIEAP and FSA are already serving energy insecure households • Pledge and energy efficiency impact • Partner departments notified of potential project VOW ORANGE COUNTY NORTH CAROLINA 21 Recommended FY20 Climate Actions Solar for Schools 0 3 proposed grant requirements — Consider leasing to maximize investment — Report energy output and % offset — Install a monitor for education Schools notified of potential project 1 n Tue Nov20,2013 � ® 25.4 p,ou�Ra > 5.49 138 Wh "New Jones County K-12 school opens" WITN, Aug 05, 2019 22 RecommPnded FY20 Climate Actions Project CFE Rank Cost Estimate Supplemental Weatherization for Low Income 1 $150,000 Households Countywide LED Campaign 2 $19,272 Rooftop solar - OCS 3 $150,000 Rooftop solar - CHCCS 3 $150,000 Total $469,272 ORANGE COUNTY NORTH CAROLINA 23 HAT IS SUSTANABILITY? In order for a ' • project to be considered sustainable, it should be- 9 environmentally # safe • socially equitable • economically sound Brennan Bouma bbouma(a-orangecountync.gov 919-245-2626 ORANGE COUNTY NORTH CAROLINA