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4 The Board received a report on a draft interlocal agreement between Orange County and the Chapel Hill-Carrboro City Schools (CHCCS) that would formally establish the upper limit of funding that the Board of County Commissioners is willing to earmark for the purchase and development of a site and construction of a proposed third high school; and to approve a resolution transmitting the draft agreement to the Chapel Hill -Carrboro School Board of Education for their comment and consideration. John Link spoke about the attached draft resolution for review. He said that he is not asking the Board to make any recommendations tonight but to wait until after the budget presentations and public hearings and other work sessions to ultimately consider what scope and amount of money to provide for the third high school. Geof Gledhill said that the interlocal agreement has many whereas statements to bring the Board to a point where it could approve the school project for High School #3 as proposed by the CHCCS Board. Important items to look at are that the Board would authorize CHCCS to proceed using eminent domain or otherwise to acquire four tracts of land that are necessary for this school and that the money would be provided by the County for the land. Most importantly, in paragraphs four and five, it lays out the source of the funds for the high school. In addition, the board of education would commit to pay for any overruns in the cost of the school. The County would commit the $27.8 million and the board of education would be responsible for the remaining out of pay-as-you-go funds. Paragraph #6 makes it clear that this settles any dispute about High School #3 and the purchase of the land and the funding of the school. Paragraph #7 provides a termination date for the application of the agreement, which would be the date when all of the debt service payments from the CHCCS pay-as-you-go money have been made to retire the debt. The last paragraph is that the agreement relates solely to High School #3 and does not apply to other aspects of the CIP. Commissioner Halkiotis referred to the blue sheet and said that at the joint meeting with the two school systems, he thought he heard the Chair of the CHCCS Board say that this school site was only going to be suitable for a school that held 1,000 students. He quoted the letter from Superintendent Pederson as follows: "John, regarding your question on the third high school, it was our desire to build a school that was for 1,000 students, expandable to 1,500. We concluded that was not possible within the 182,000 maximum square footage. Therefore, we are designing for 1,000 students without larger facilities to provide for expansion. At the same time, I would say that I don't think the school board has totally given up on the possibility for expansion at a later date on this campus." He said that he was confused and he asked if the site allows for expansion to 1,500 students. Commissioner Gordon said that her understanding is that the site is big enough for 1,500 students but the goal at this point is to build for 1,000 students. Her understanding is that there is sufficient land for 1,500 students. Commissioner Carey said that it is best to ask the school board when they come on the 22nd and to let them know that the Board is going to ask them about this. Geof Gledhill said that everything in the interlocal agreement is related to a 1,000-student high school. It does not eliminate the possibility that the school could be expanded, but the expansion of the high school would not be part of the agreement. Chair Brown asked about the standards for square footage for schools and their expansion. She said that we have always said that we could not expand schools after they have been built because the core facilities are not large enough to allow an expansion. She asked why we are even contemplating this expansion. John Link said that this is only a form tonight to review and to use as an example. He said that they do have construction standards for all levels of schools. The question is what type of school will the County be getting for this amount of money. This question can be communicated to the school board. Commissioner Halkiotis asked about the impact of this school on other capital projects and John Link said that Budget Director Donna Dean has given them enhanced graphs that extends the life of the CIP for ten years and the debt service threshold. There are some decisions to be made by the Board regarding how much debt the County can absorb during the next few years.