Chatham Board of Commisioners budget work session minutes - 6/06/07

Commissioner Lucier confirmed the School Board request for $29,030,262 which included the debt service of 3.4. He asked the staff recommendation.

Renee Paschal, Assistant County Manager, explained that the recommendation fully funds the request for the teachers’ supplement; that it eliminates roughly $620,000 from the expansion budget; that the continuation budget is the difference in the Virginia Cross School as it was over-projected; that that difference is $310,735; that the other reduction is in the expansion budget which takes away any funds for expansion in the school request; that the Board of Commissioners'is fully funding their continuation budget, almost fully funding capital outlay, and fully funding the request for teachers’ supplement.

Commissioner Barnes asked if the two cents increase in property tax that they would have had would be cut to one cent. Ms. Paschal replied in the affirmative. She stated that the new expansion number would be $762,000 minus the $310,000 which is the teachers’ supplement.

There were no questions regarding capital outlay.

Chairman Thompson stated that they had recently received documentation listing approximately six different scenarios for construction and renovation at Northwood High School.

Dr. Hart stated that her board looked at the long-range facility plan and used the standalone one-story ($13.5 million); that she would caution the Board that those are estimates; that there has been no formal design work done; and that was done to increase capacity to 1,200.

Commissioner Lucier reviewed the different issues to Northwood expansion stating that there was the media center, cafeteria, auxiliary gym, and additional classroom issues. He stated that by reducing the cost of the high school from 44 to 38 million, the six million dollar savings should go back to serve the students at Northwood High School who are in a crowded situation. He stated that the question was how to best deal with it; that with the auxiliary gym, it’s not just a school issue, it’s a County recreation issue; that there is not enough gym space in the County to handle recreational activities that are now going on; that as the County continues to grow, it is pretty hard to get practice time at the schools; that another gym in the County would be something the schools could use during the day and the Recreation Department could use it at night.

Commissioner Barnes stated that for the thirteen million dollars, property taxes would have to be raised another cent; that he doesn’t think that should be done; that he is as opposed to an additional gym at Northwood as Commissioner Lucier is for it; that with everything else going on, he does not see the justification for it; and that he feels the six million dollars for renovations to the high school is justified, but an additional thirteen million dollars is not. He stated that if the County can get their 1% Land Transfer Tax, it will open the door for a lot of things; that if they do not get it, the next several years will be hard budget-wise.

Commissioner Lucier stated that he deals with a lot of recreation coaches; that he feels that the need is determined by whom they talk to; that he can say that the situation is not good in terms of availability of gym space; that it is part health issue for the students and part health issue for the County at large; that he thinks the County’s recreation activities have been short-changed for a number of years; and that he doesn’t think they should continue to do that.

Chairman Thompson asked if there were other areas in the County where there were problems with gym space.

Mr. Clark stated that the problem didn’t seem to be gym space but more of a problem with the condition of the gyms; that they have very old gyms at Silk Hope, Bonlee, and Bennett; that Bonlee and Silk Hope need some expansion work and renovations; that Commissioner Lucier is correct in that from a recreation standpoint, the County is growing so fast and doesn’t have recreational facilities to accommodate everyone; that at the schools, they have some severe needs and that while an auxiliary gym would help, it wouldn’t solve the majority of their problems; but that the gym would serve more than just Northwood in that it would serve the County. He stated that one of the biggest issues at Northwood at the present is the cafeteria; that they are having three huge lunch shifts which are overcrowded; that if they received six million dollars, they might renovate or expand the cafeteria; that they have options for which the money could be used.

Dr. Hart stated that Bonlee and Silk Hope need to be expanded; that they are very small; and that the gym is too small to accommodate school issues as well as community issues.

Commissioner Vanderbeck asked if the gym provided flex space for teaching and if part of it could be used during the day for classrooms to cover several needs.

Mr. Clark stated that it was used all during the day for physical education.

Commissioner Vanderbeck stated that a lot of money shouldn’t be put into it because the County is getting an entire new school; that they don’t want it to be a ghost town years down the road.

Dr. Hart stated that all classrooms and instructional space requires desks; that where they flex is where there is a stage; that the stage would help make a flex space; that the problem with trying to use a gym for anything other than health, gym, or physical education, is that the rest of the time the furniture cannot be moved period by period.

Commissioner Vanderbeck suggested that be considered and some of the money be put into taking care of the cafeteria needs because they are over maxed out stating that he was trying to stay within the savings that they just found from the high school.

Commissioner Barnes cautioned that by the time renovations can be designed, permitted and put out for bids, the new high school would be built in 2011; that the time frames will be about the same for doing the additional work as building the high school; that the students will be split approximately in half; that half will go to the new school and half will go to Northwood; and that there will be time to add on at that point as the student population will decrease at Northwood.

Mr. Clark stated that by the time the new high school opens, the population at Northwood will be reduced; that Commissioner Barnes is correct in his statement; that the demands on the facility space will lessen; and that on the other hand, the space that is being proposed will still be used by the community.

Dr. Hart stated that there would be approximately 600-700 students at Northwood and the new high school at that time.

Commissioner Barnes expressed concern with regard to the different cleanliness in each of the schools stating that there was a world of difference in how some of the schools were cleaned as opposed to others.

After further discussion, Chairman Thompson reiterated that the Board is looking at a two cents increase; that he thinks there is a consensus with the Board to not go beyond that at this point; that Commissioner Lucier and he are old jocks who are gym people which is why they support the gym; that he understands the need for the gym at Northwood; that one of the things that they have to consider is what is before them; that one thing they have not heard is a recommendation from the School Board when they have six million dollars put before them; that he feels that the Board of Education knows their needs better than the Board of Commissioners does; that his idea would be to work with the auxiliary gym as the first need; that he knows they have cafeteria needs as well; that he would like to see the Board of Education put a plan together to utilize the six million dollars and to have an expansion plan, which in stages, could be used if the Land Transfer Tax is put through; and that he would suggest that they consider where Silk Hope and Bonlee Schools needs lie.

Dr. Hart asked if the Board of Commissioners could tell them a full amount as she would like for the entire Board of Education to be able to discuss the project, the preferred phases, and the utilization of the funds.

Commissioner Lucier stated that the judicial facility impacts this; that he thinks that the Finance Officer added twenty-six million for debt purposes; that he still remains somewhat uncomfortable with building a judicial building with a lot of extra space in it when the schools are crowded; that he has some issues with that; that the two are not totally unrelated; that if the Board is going to try to stick within a two cents tax increase, according to the Finance Officer’s figures for debt purposes, 1.2 million is equivalent to .1 cents; that 2.4 million is equivalent to .2 cents; and that 6 million is equivalent to ½ cent in terms of long-term CIPS.

Mr. Clark, for clarification, asked if the Board wanted them to return with specific plans with what their most critical needs for the $6.6 million.

By consensus, the Board agreed.

Commissioner Cross stated that everyone was speaking of the six million dollars as extra available money. He cautioned that, in fact, it is an estimate of no more than available credit. He stated that if the Board did not have some strong need to spend the money, he would suggest that they hold on to it because their estimates of projects to be built, may run higher than anticipated.

Commissioner Lucier stated that the high school had already been budgeted for forty-four million, but the estimate for it is now thirty-eight million for a smaller, more expandable school. He stated that they would be splitting the pot and moving money from one project to another.

Kevin Whiteheart, County Attorney, stated that there was a provision under Chapter 143 in the General Statutes that relates to performance contracting which is a method that the Legislators set up approximately six years prior that says the County can borrow up to two million dollars; that it does not go against the debt limit provided that the money borrowed is to save money on energy costs, water and sewer savings, etc.; that it builds a pot of money, in that for a small outlay, one would receive a bigger bang for their buck; that it may be something that the County can look at; that for a small amount of investment that doesn’t go against the debt ceiling, three times the amount of money may be generated; that it doesn’t have to be done before the budget is passed; that it can be researched to see if there is enough monies available to be brought to the Board for their consideration.

By consensus, the Board agreed and asked the County Manager to research this matter.

BREAK

The Chairman called for a short break.

The Chairman called the meeting to order at 11:10 AM.

Commissioner Lucier asked if the salary for the County Attorney included a salary for a paralegal. Renee Paschal responded that it included the salary for an administrative person, not necessarily a paralegal.

Commissioner Vanderbeck asked if they would be sharing an administrative assistant between the Public Works Director and the County Attorney. Ms. Paschal explained that that was only a temporary arrangement until the County Attorney can get furniture and an assistant.

Commissioner Lucier asked if the school had their own facilities management. The County Manager responded that schools are totally separate from the County. Commissioner Lucier stated that there had been some issues with the schools regarding upkeep, etc.; that he wonders if there is a better way of doing that; that all Board members have commented on the unevenness of the facilities upkeep of the schools; that he doesn’t know the best answer; and that the Board might want to think about anything that could be shifted back and forth with regard to facilities maintenance.

Commissioner Vanderbeck stated that he thinks that if the management of the facilities is poor, then it will lead to its demise sooner; that that it is critical from a long-term perspective; and that the buildings need to be maintained so that they will last longer and serve the public better.

Chairman Thompson stated that he feels that this is more of a directive coming from the head of the facility explaining what they want done; that he feels that maybe they got the message this morning; that he thinks some people will gravitate to the level of performance based on what they are allowed to do sometimes; and that if they have a standard set for them, then he believes that they can change.

Commissioner Lucier asked about the large increase in General Services with regard to their budget. Ms. Paschal explained that that pertained to consultant fees for impact fee studies, contingencies, etc. She stated that transfers were also increased; that one increase was the property tax between four cents and the debt reserve; that allocation to the vehicle reserve was increased by $500,000.00; and that the CIP projects in next year’s budget were also funded.

Commissioner Lucier asked about the Recreation Department. He stated that the hiring of the extra person in the department was needed. He asked if there was going to be a discussion with regard to land acquisition program, stating that they had talked about the joint committee including someone from the Recreation Department and the School Board to start trying to save some money to buy some property to try to get ahead of the curve. He stated that the Recreation Department has already looked at Camp Maranatha Springs; that he thinks that the appraisal was $1.3 or $1.4 million; that it is an excellent piece of property; that at some point, it could be a northwest park as well as a school site with 120 acres; that with the exception of a couple of buildings, the soils and topography are great; and that he feels it would be a good purchase for the County.

Commissioner Barnes stated that the entire Recreation Department Program in Chatham County is pitiful; that he is talking about what the County puts into it and what it has compared to surrounding counties; and that they are definitely going to have to work on it.

Commissioner Vanderbeck stated that all ties in with economic development, community services, facilities for communities for families staying in Chatham County and those companies relocating here; and that they want to be a destination here.

Commissioner Barnes stated that GE and Honda have just gotten into the jet airplane business; that by the County’s not having what it should have, it looks like the plant used to manufacture the engines would go to Alamance County; that they have the infrastructure, their EDC in place; and that that is three times in the past two weeks that he has read things like this going to other counties.

Chairman Thompson stated that all of the comments were good and that he feels that they need to be addressed in a future work session and that a land search committee needs to be discussed.

Commissioner Lucier asked if this could be done at the July 18, 2007 Board of Commissioners'meeting.

Commissioner Lucier also asked that Camp Maranatha Springs be addressed. He asked if the requirements were 1/3 up front and the remainder over five years. The County Manager stated that unless the requirements had changed, they needed the first portion, approximately $450, 000-500,000 up front.

Commissioner Lucier stated that he thought that the Board also needed to look at buying property for the northeast park; that there is a southwest park; that the Maranatha Springs property could potentially be a park site as well as a school site; and that he feels that the Board needs to start looking at property in the southeast as it is not going to get any cheaper and the needs are going to get greater.

The Assistant County Manager stated that the Board would be looking at adding to the tax rate to accomplish that; that the other issue is that if the County was to get the Land Transfer Tax, part of the proceeds could be used for the land.

Commissioner Vanderbeck stated that any discussion that the Board has, as far as land acquisition, needs to be done with an overlay with the Public Works Department; that not only would there be existing infrastructure, there would be future infrastructure; and that those things need to work in concert as much as possible.

Commissioner Cross asked if the County still owned approximately twenty acres around the Bynum ball field. The County Manager stated that the County owned some land, but that he was not certain of the exact acreage. Commissioner Cross stated that he thought that the land was purchased to expand the sewer plant; that he doubts that will ever be done; and that the Recreation Department might be informed of this.

The Assistant County Manager explained that the County tried to do that about ten years ago; that they tried to apply for a PARTF grant to expand the Earl Thompson Park; that they received a lot of resistance from the Bynum Community; and that the roads are narrow and have a narrow access into the park.

Commissioner Vanderbeck stated that he didn’t feel the wastewater treatment plant would be expanded; that it becomes less viable as the new rules come into place for Jordan Lake and the stormwater things; that he doesn’t feel that the State will allow a larger capacity to dump affluent into the river there.

Commissioner Lucier asked about the budget for Economic Development stating that it was approximately twice as much as he thought it was.

Ms. Paschal explained that it included debt service for the Business Park for next year in the amount of $329,000.

Commissioner Lucier stated that the new Economic Development Director should probably update their objectives, especially with Lee and Harnett Counties. The County Manager stated that he thought this was one of her first interests.

Ms. Paschal explained that staff budgeted for a pay increase for Commissioners’ salaries and an increase in the travel allowance.

Commissioner Lucier asked the difference in the Waste Management Fund and the Waste Management. He asked what had happened to the Water Capital Reserve asking if the Board was going to spend as much money due to the Harnett County Contract, if the money still had to stay in the five million into the water reserve.

The Finance Officer stated that she felt the money should stay in the water capital reserve because the amount of money available for debt payments for the new water lines is contingent on how well the water operating fund does and how much availability fees are collected; that if either one of these sources of revenue are less than projected, then money would need to be transferred from the general fund to pay the debt. She reiterated that the money was set aside in a capital reserve fund and could only be used for water capital purposes.

Commissioner Lucier stated that the Board may want to consider moving a bit of the money to start the land acquisition project, i.e. Camp Maranatha Springs, stating that instead of putting all five million dollars in there, put four and one half million and use five hundred thousand to purchase the land.

Commissioner Barnes asked if this could be done.

The Finance Officer stated that money had already been moved to the reserve fund, but if the Commissioners wanted to transfer the money back to the general fund, it could be done.

Commissioner Lucier stated that this was money put into fund balance and he thought it was reasonable to take a little of it out. The Finance Officer stated that once it goes into water reserve fund, it is supposed to be used for what it is intended. She stated that if the Board wanted to spend money for Maranatha Springs, she thought there was enough money in the general fund to do that.

Chairman Thompson stated that the idea was to look at a small amount of money to be used for a down payment on Camp Maranatha Springs; that he thinks the issue is now from where the money should come; that he is hearing that the money may be available; and that he thinks the idea should be endorsed and voted on at a later meeting.

Commissioner Vanderbeck stated that in talking about land banking and preparing for schools in the future; that in the moratorium, they have talked about affordable housing in developing those ordinances; that to deal with that, they currently know that they have an existing need for one proposed development for fifty units; that Pittsboro would cover 1/5 of the need in the County as was identified some years back; that this is ahead of the land issue with a pressing identified need at this time; that the County doesn’t have the funds or the development; that they are currently working on the one in Pittsboro with Habitat; that they have the one coming up in Briar Chapel; that they have identified a need; that they have the funding to do a needs assessment to bring them up-to-date; that there is no denying that there is not enough affordable housing here; that it hurts the County from an economic development standpoint where there are people who cannot work in the County; that there are also people who are living in other counties who travel into the County for jobs; that the Board needs to put some money away for affordable housing, potentially within the next year if they can get everything lined up, infrastructure settled, and get a developer who wants to do this; that they have to have available funds into which they can tap; that he would appreciate any creative ways in which the Board would be able to do this.

The County Manager stated that he thought this was consistent with the DHIC request to consider the $400,000.00; that if the Board wanted to set it up, it could be done contingent upon DHIC or other housing opportunities becoming available; and that it is a decision for the Board to make.

Commissioner Vanderbeck stated that it was not that the Board had to take it out; that funds were there when and if the occasion arises; that it would be a one-time thing; that something is going to happen; that he liked the one mentioned because of starting off with the County seat; that it all fits; and that the County needs to be on the leading edge of it.

Commissioner Lucier asked what happened to Pittsboro.

Commissioner Vanderbeck stated that they had a developer from a local developer that raised some questions and has currently put an offer on the property. He stated that it would be revisited at that property or some other place.

The County Manager stated that those funds were predicated upon Pittsboro’s matching funds.

Commissioner Vanderbeck moved to create a reserve fund for Affordable Housing in the amount of $400,000.00 to be left in General Fund and, at the Board’s discretion, which can be used as needed. He stated that the intent of his motion is to send a message to the citizens that they have set aside funds for affordable housing and that they plan to have a summit after a feasibility study is completed in the fall.

Commissioner Lucier asked if the motion was to reserve a part of the fund balance.

Commissioner Vanderbeck stated that the motion was to reserve a portion of the fund balance to the tune of $400,000.00. The County Manager stated that it becomes a fund balance that is available for appropriation and a fund for restricted use.

Commissioner Lucier asked if it impacted the fund balance immediately or after it is taken out.

The Finance Officer explained that it would stay in the fund balance but will be part of the restricted fund balance.

Chairman Thompson asked for a second to the motion.

Commissioner Lucier stated that he would prefer to look at the fund balance and vote on the matter at the July 16, 2007 Board of Commissioners'meeting.

The motion died for lack of a second.

Commissioner Cross moved, seconded by Commissioner Lucier, to set the salary of the Sheriff’s salary at $85,000.00. The motion carried five (5) to zero (0).

Commissioner Barnes moved, seconded by Commissioner Cross, to set the salary of the Register of Deeds’ salary at $71,760.00. The motion carried five (5) to zero (0).

Commissioner Barnes moved, seconded by Commissioner Cross, to set the salary of the County Manager at $125,882.00. The motion carried five (5) to zero (0).

The Assistant County Manager reviewed the list of changes to the recommended budget as follows:

Ms. Paschal stated that, in addition, staff will increase the transfer to the debt reserve by $681,001 for the one-penny increase for capital projects, leaving the tax rate at 61.7 cents which will be reflected in the budget ordinance; that any other changes that come up will be taken from contingency; and that she will provide a detailed description of changes when the budget ordinance is presented.

Commissioner Lucier moved, seconded by Commissioner Barnes, to approve the above list. The motion carried five (5) to zero (0).