Loading...
HomeMy WebLinkAboutAgenda - 10-28-2008 - 8ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 28, 2008 Action Agenda Item No. S SUBJECT: Discussion of 2009-19 Recommended County Capital Investment Plan (CIP) DEPARTMENT: County Manager and Budget PUBLIC HEARING: (Y/N) No ATTACHMENT(S): To view the FY 209-19 County Capital Investment Plan (CIP) go to www.co.orange. nc. us/budget/2009- 19ManagerRecommendedCl P.asp INFORMATION CONTACT: Laura Blackmon, (919) 245-2300 Donna Coffey, (919) 245-2151 PURPOSE: To discuss the FY 2009-19 recommended County Capital Investment Plan (CIP). BACKGROUND: The County Manager presented the FY 2009-19 County Capital Investment Plan (CIP) to the Board on October 21, 2008. The proposed Plan outlines capital needs in excess of $225 million with identified revenue streams of $206.2 million to fund highest priority projects. This leaves $18.8 million in unfunded needs listed in Appendix B of the CIP document. Identified revenue streams to fund projects include $135.5 million coming from pay-as-you-go and past debt issuances and $70.7 million proposed for future debt funding. It is important to note the October 21 proposed plan outlines County capital needs only -Chapel Hill Carrboro and Orange County School Boards of Education will present their capital needs to Commissioners during the upcoming November 13, 2008 budget work session. Tonight's work session offers the Board an opportunity to discuss County capital revenues and needs. Specific topics staff would like the Board to discuss tonight are outlined below. The Board may also choose to discuss other items of interest. FY 2009-19 Capital Revenues Pay-As-You-Go Revenues The Board is to be commended for having a capital funding policy that recognizes the need to not only provide for new facilities but also the importance of re-investing in current infrastructure. County departments have many competing and pent up capital needs. These range from having adequate space to serve our clients and patients to storing records and equipment in controlled environments. 2 In 2007, the Commissioners adopted the County's current Capital Funding Policy. The Policy sets formulas for calculating pay-as-you-go revenue streams for School and County capital projects. As stated in the Capital Funding Policy, it is the intent of Commissioners to dedicate these funding levels to capital projects. However, to date the County has not fully funded School or County capital needs because there has been little or no overall revenue growth to cover competing operating needs for School and County programs. The chart below compares funding levels designated by the policy with currently approved funding levels. Schools Share Coun Share Level of Funding In FY 2008-09 Level of Funding In FY 2008-09 Revenue Accordance Level of Accordance Level of with Current Funding with Current Funding Polic provided Polic provided 60% (distributed 60% (distributed Pay-As-You-Go Funding to each district to each district from dedicated property based on their based on their 40% 24% ~'~ and sales taxes remaining percentage of percentage of after debt service is paid student student membershi membershi Equivalent of 3 Equivalent of 2 Equivalent of 1 cents on the tax cents on the tax cent on the tax rate each year to rate each year to rate each year to Recurring Capital offset recurring offset recurring offset recurring Not currently capital repair capital repair and capital repair funded and maintenance and maintenance costs maintenance costs costs ~'~ FY 2008-09 approved annual operating budget redirected $1.4 million from the Manager's recommended pay-as- you-go County CIP to the County's General Fund to fund the annual operating budget. The net effect of this reallocation of funds is that it reduced the percentage of County CIP revenues from 40% (the equivalent of $3.2 million) of total pay-as-you-go funding to 24% (the equivalent of $1.8 million) of total pay-as-you-go funding. The Recommended 2009-19 CIP proposes full funding in accordance with the current Capital Funding Policy for County capital projects. This step will allow the County to be proactive in addressing costly recurring capital maintenance items such as roof and HVAC replacements. This approach has served both school districts well -they have used their 2 cents to maintain school buildings -doing things such as roof and HVAC replacements. As a point of reference, the HVAC system located at the Jail is old, routinely in need of repairs, and energy wise inefficient. Should the system fail completely the County would have no choice on whether to repair/replace the system or not based on State and federal mandates. The anticipated cost to replace the system ranges from $950,000 to $1 million. Staff proposes using proceeds from the first year (FY 2009-10) of one cent recurring capital funding to replace the existing system with a new more energy efficient system. In doing so, the County would realize savings in repair and energy costs. Without- funding from the recommended 1 cent for recurring capital, if the system fails during the upcoming fiscal year, the County would likely have to use monies from fund balance to cover the replacement cost. Most of the County's facilities are old and in need of capital repairs and maintenance. Appendix D of the 2009-19 CIP was prepared by Public Works and identifies specific projects that staff would complete if funding 1 cent on the tax rate for County recurring capital were approved. Debt Funding The recommended CIP proposes a number of future debt issuances beginning in fiscal year 2011-12. Some of these the Board has discussed previously and some are new to the CIP. The chart below outlines proposed debt issuances for County projects during the 2009-19 CIP timeframe. Proposed Debt Issuances Between FY 2011-12 and 2018-19 Blackwood Farm at New Hope $4,800,000 Human Services Offices & Clinics at Hillsborough Commons $20,654,000 Millhouse Road Park $8,200,000 Mountains to Sea Trail $1,259,000 New Hope/Hollow Rock Preserve $625,000 Northeast Park $7,400,000 Soutern Human Services Center Addition (includin new dental clinic) $5,250,000 Twin Creeks Park $13,000,000 Upper Eno Nature Preserve Public Access Areas $1,312,500 West Ten Park $600,000 Total Pro osed Debt Issuances $63,100,500 Other Topics for Discussion The list below identifies project related topics for the Board to discuss and provide further direction to staff. During this portion of the work session Commissioners may wish to discuss other individual County projects. • Future Library Facilities (page 48 of the 2009-19 CIP) • County Information Technology Needs (Appendix E of the 2009-19 CIP) • Unfunded County projects (Appendix B of the 2009-19 CIP) • Future Use of Northern Human Services Center Possible disposition of current County facilities will be a topic at the November 13, 2008 budget work session. FINANCIAL IMPACT: Financial impacts are included in the background information above. RECOMMENDATION(S): The Manager recommends the Board of County Commissioners discuss the FY 2009-19 Recommended County Capital Investment Plan (CIP).