HomeMy WebLinkAboutAgenda 10-19-2021; 8-c - Approval of Financing Arrangements for Orange Rural Fire Department to Construct a New Fire EMS Station 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: October 19, 2021
Action Agenda
Item No. 8-c
SUBJECT: Approval of Financing Arrangements for Orange Rural Fire Department to
Construct a New Fire/EMS Station
DEPARTMENT: Finance and Administrative
Services
ATTACHMENT(S): INFORMATION CONTACT:
Attachment 1. September 20, 2021 Public Gary Donaldson, 919-245-2453
Hearing Notice Rebecca Crawford, 919-245-2152
Attachment 2. Minutes from September
20, 2021 Public Hearing
Attachment 3. Fire Department President
Letter
Attachment 4. Fire Service Agreement
Attachment 5. Certificate of Approval
PURPOSE: To approve Orange Rural Fire Department (ORFD) entering into a financing
arrangement for the construction of the fire portion of a joint fire/EMS station in the Waterstone
community of Hillsborough and authorize the BOCC Chair to sign the appropriate documents
related to the financing arrangements.
BACKGROUND: ORFD intends to contribute to the funding of a new, joint fire/EMS station with
Orange County Emergency Services in the Waterstone Community at 350 College Park Road,
Hillsborough, NC. A letter from the fire department's president outlining the department's intent to
finance its portion is attached. The new station will support residents in the southern part of the
central Orange fire district where some households are considered "uninsurable" due to the
distance from current fire station locations. The new station will be approximately 13,000 square
feet with the fire portion totaling 7,818 square feet. The fire portion of the station will house a full-
time, 24-hour engine company, which consists of a fire engine and two to three full-time staff.
ORFD will finance $2,700,000 at a 2.73% fixed rate for 25 years, with $1,300,000 as a down
payment through Roxboro Savings Bank. Monthly payments will be $12,428 and covered by the
existing debt service line item in the district's budget. These new payments will not cause a tax
increase for the district. Construction of the station will begin in FY 2021-22.
Funding for the EMS portion of the new Waterstone station and furnishings was approved as a
part of the County's FY2021-26 Capital Investment Plan (CIP) for a total of $3,450,000.
Volunteer fire departments are required to obtain Board of County Commissioner approval of such
purchases only when they use tax-exempt debt financing to pay for purchase. Volunteer fire
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departments are not mandated to obtain Board of County Commissioner approval when making
purchases that do not require debt financing.
Section 147(f) of the Internal Revenue Code of 1986 outlines specific steps that must occur when
a tax supported fire department enters into a financing arrangement. The department has
completed the required steps to comply with Section 147.
• Conduct a public hearing — On September 20, 2021, ORFD held a public hearing
regarding the financing of the station. ORFD advertised the hearing in the News of Orange
(Attachment 1 of this abstract). Per the hearing notes (Attachment 2 ), no individuals signed
up for comment or made comment when the floor was opened during the hearing.
• Obtain approval of the "applicable elected representatives" — In accordance with
Section 147, the Board of County Commissioners must approve the Department's plan to
enter into the debt arrangement. This approval does not create liability on the part of
Orange County nor does it make the County responsible for the repayment of any debt
assumed by the fire department. The approval provides a mechanism for the
Commissioners to acknowledge that, through this financing arrangement, the Fire
Department is pledging use of the Fire Tax District's tax dollars to repay the loan. In order
to comply with this IRS requirement, the Chair of the Commissioners must sign the Fire
Service Agreement and Certificate of Approval for the district (Attachments 4 and 5).
FINANCIAL IMPACT: ORFD plans to finance $2,700,000 for the construction of a portion of a
new fire/EMS station in Hillsborough. The department Board of Directors has agreed to a 25-year
loan at the fixed rate of 2.73% APR with Roxboro Savings Bank. The department does not
anticipate the debt service payments will cause an increase in the current district tax rate.
SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to
this item:
• GOAL: CREATE A SAFE COMMUNITY
The reduction of risks from vehicle/traffic accidents, childhood and senior injuries, gang
activity, substance abuse, and domestic violence.
ENVIRONMENTAL IMPACT: No Orange County Environmental Responsibility Goal impact
associated with this item.
RECOMMENDATION(S): The Manager recommends the Board:
1. Approve Orange Rural Fire Department enteingr into a financing arrangement to contribute
to the construction of a joint fire/EMS station; and
2. Authorize the BOCC Chair to sign the appropriate documents related to the financing
arrangement.
WOMACK PUBLISHING 3
PO Bax 530
CHATHAM VA 24531
(434) 432-1654ext
ORDER CONFIRMATION
Salesperson: Not Applicable Printed at 09/27/21 14 : 25 by mdavi-wp
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Acct # : 17823 Ad # : 30884 Status : New
ORANGE RURAL FIRE DEPARTMENT Start : 09/01/2021 Stop : 09/08/2021
2065 CHURTON STREET Times Ord: 2 Times Run: ***
HILLSBOROUGH NC 27278 STD 2 . 00 X 1 . 34 Words : 73
Total STD 2 . 68
Class : 650 Legal Notices
Rate : LEG Cost : 46 . 63 <__
# Affidavits : 1
Contact : Ad Descrpt : PUBLIC NOTICE IS HEREBY G
Phone : (919) 732-7911 Given by:
Fax# . P .O. # .
Email : Created: hwill 08/27/21 13 : 37
Agency: Last Changed: hwill 08/27/21 13 : 46
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AUTHORIZATION
Under this agreement rates are subject to change with 30 days notice . In the
event of a cancellation before schedule completion, I understand that the {
rate charged will be based upon the rate ", f r the number of insertions used.
$amMet('pr-Int or type) arae (signature
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PUBLIC NOTICE
is hereby given that the Orange Rural Fire
Department NO. 1, INC. will meet at the I
fire department located at a S. Churton �� r �� i
St.,Hillsborough, N.C. 272788 at 7:00 min I�.(, r
a public hearing to discuss financing a j
new fire station. All persons interested
and living in the central Orange fire district j
may appear at said place and time. By the
order of the Orange Rural Fire Department j
NO. 1, INC. i
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Orange Rural Fire Department
Public Hearing
9/20/2021
Attending: Jeff Cabe, Steve Summey,Jonathan Capps, David Shaw
Meeting call to order at 7:00pm by Steve Summey
Discussion: The Orange Rural Fire Department wishes to pursue funding for the construction of
a new fire station at 350 College Park Rd. Hillsborough, NC.
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No citizens of the central orange fire district were present.
Meeting adjourned at 7:15pm
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®range Rural Fire Department
PO Box 1511
Hillsborough, NC 27278
September 27, 2021
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Orange County Finance
Atten: Rebecca Crawford
PO Box 8181 1
Hillsborough, NC 27278
Dear Rebecca:
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The Orange Rural Fire department would like to request approval from the Board of
County Commissioners for funding the construction of a new proposed fire/EMS station J
that will be located in the Waterstone community, specifically at 350 College Park Rd.
Hillsborough, NC.
This station is needed to support citizens in the southern part of the Central Orange fire
district, where some are currently considered "uninsurable" due to distance from our
current locations. The station is currently proposed to be a fire/EMS station, awaiting
approval from the county. The fire station is approximately 13,000 sq, ft; with the fire
station being 7,818 square feet. The amount that we are proposing represents the fire
station side only. If approved, the station will house a full-time, 24-hour engine
company, consisting of a fire engine and two to three full-time staff.
We have applied for funding from three different banks and have found that Roxboro
Savings Bank has offered the Orange Rural Fire Department the best suited finance
option. The Orange Rural Fire Department proposes to finance $2,700,000.00. The
financing options are 2.73 percent fixed rate for 25 years. Making our payment
$12,428.00/month. We chose to put down $1.3 million. The bank loan rate is $500.00
and there is no penalty for early payoff.
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In our current year budget, we have a debt service line item, that covers the payments
for this loan with no new tax increase.
Sincerely
Steve Summey, President
206 S.Churton St. www.ORFD.net
Hillsborough,NC 27278 admin@orfd.net
(919)732-7911
Fax: (919)644-1338
Attachment 4 6
Fire Service Agreement
This agreement, dated this day of October, 20 , by and between
Orange Rural Fire Department, Inc., a body corporate organized under the Laws
of the State of North Carolina, the ("Fire Department"), and Orange County, a
body politic, the ("Political Subdivision").
WHEREAS, Fire Department is a not for profit organization duly authorized for
the purpose of providing firefighting services in an area within the jurisdiction of
the Political Subdivision; and,
WHEREAS, the Orange Rural Fire District is a designated fire district with
prescribed boundaries pursuant to NCGS § 153A-233; and,
WHEREAS, the parties wish to enter into an agreement setting forth the area and
duties of the Fire Department.
NOW THEREFORE , the Fire Department and Political Subdivision do hereby
agree as follow:
1. Political Subdivision recognizes that Fire Department provides firefighting
services to the hereafter generally described area or areas: primary
firefighting responsibilities (area of responsibility) is Orange Rural Fire
District.
2. Political Subdivision shall not be liable or responsible for the conduct and
activities of Fire Department.
IN WITNESS WHEREOF, the parties have had this agreement executed by duly
authorized representatives thereof.
Orange Rural Fire Department
By
Name
Title
Orange County
By
Name
Title
Attachment 5 7
Adam-
IS
ORANGE COUNTY
NORTH CAROLINA
FINANCE AND ADMINISTRATIVE SERVICES
405 Meadowlands Drive Phone(919)245-2151
Post Office Box 8181
Fax(919)644-3324
Hillsborough,North Carolina 27278
Certificate of
Approval
Section 147(f) Approval and Written Agreement
The undersigned Official of Orange County, NC (hereinafter referred to as "County")
pursuant to section 147(f) of the Internal Revenue Code of 1986, as amended (the
"code"), hereby approves the entering into by Orange Rural Fire Department of an
Agreement in an aggregate principal amount not to exceed $2,700,000.00 to finance
a new fire/EMS station located in the Waterstone community at 350 College Park Road,
Hillsborough, NC. This approval does not in any way constitute any financial
involvement or obligation of the County.
Furthermore, this document acknowledges that for consideration, the receipt and
sufficiency of which are hereby acknowledged, the Orange Rural Fire Department has
provided firefighting and other services for the County for many years and Orange Rural
Fire Department hereby agrees to meet the requirement to continue to provide firefighting
and other services for the County.
Dated as of -
Orange Rural Fire Department Orange County, NC
Steve Summey,President Signature of authorized representative
Name and Title
An Equal Opportunity/Affirmative Action Employer
www.orangecountync.gov