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ORANGE COUNTY <br />BOARD of COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: October 2, 2009 <br />Action Agenda <br />Item No. <br />SUBJECT: Discussion of Capital Project Funding <br />DEPARTMENT: Counter Managers Office PUBLIC HEARING: 1 Yes <br />Financial Services Department <br />ATTACH E T s = INFORMATION CONTACT: <br />Capital Funding Update Marne, 'hone Number <br />Gary Humphreys reys 9 9- 245 -2453 <br />PURPOSE: To provide the Board an opportunity to review and discuss the status of capital <br />project funding as it relates to upcoming update of the Capital Investment Plan. <br />BACKGROUND: This work session provides the Board with an update of certain factors which <br />will impact the upcoming Capital Investment plan and budget for County and School capital <br />projects. <br />• Status of funds allocated for unmet project funding Managers two year plan) <br />0 Review of Known Impacts on 2010-11 Budget <br />0 Impact of increasing debt service <br />• Review prior capital funding allocation <br />• Funding required to meet existing capital commitments <br />• Listing of Projected New Financings <br />• Review of Updated Debt Capacity Projections <br />The update of the Debt Capacity projections highlights changes in the debt capacity outlook <br />which occur as the result of slower growth in the County' s major revenue sources. Property <br />Taxes which make up approximately o of the General Fund budget will grog more slowly <br />as a result of the slowdown in development and the Board's decision to hold property tax <br />rates revenue neutral in F 2010. The debt capacity projections assume that there will be <br />small increases in future property tax rates. The state's projections of sales tax revenue <br />show a continued* decline through next fiscal year. We have assumed a further decline in <br />Bales tax revenue of approximately 2% which is loss than the states projected 3 -4% decline. <br />The slower growth in the budget negatively impacts the growth of pay as you 90 revenues <br />available for capital projects. It also impacts the ability to pay for additional debt financing <br />and remain within the county's debt policy of maintaining debt service payments a t 15% or <br />less of the General Fund budget. The 11 1 % `policy adopted by the Board is not an arbitrary <br />