Orange County NC Website
ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: May 18, 2010 <br />Action Agenda <br />Item No. - — (Yl <br />SUBJECT: The Establishment of a County Capital Reserve Fund <br />DEPARTMENT: Financial Services PUBLIC HEARING: (Y /N) No <br />ATTACHMENT(S): <br />Attachment 1: Resolution to establish a <br />County Capital Reserve <br />Fund <br />INFORMATION CONTACT: <br />Clarence Grier, (919) 245 -2453 <br />Michael Talbert, (919) 245 -2153 <br />PURPOSE: To establish a County Capital Reserve Fund for future County Capital needs. <br />BACKGROUND: On June 11, 2009 the Board of County Commissioners approved the <br />establishment of a County Capital Reserve Fund for the proceeds from the sale of surplus <br />property with 60% of the proceeds designated for the needs of older schools and 40% for <br />County needs. <br />As stated is General Statute 159 -18 Capital Reserve Funds; "A local government may establish <br />and maintain a capital reserve fund for any purposes for which it may issue debt. A capital <br />reserve fund shall be established by resolution or ordinance of the governing board which shall <br />state (i) the purpose for which the fund is created, (ii) the approximate periods of time during <br />which the moneys are to be accumulated for each purpose, (iii) the approximate amounts to be <br />accumulated for each purpose, and (iv) the sources from which moneys for each purpose will <br />be derived." <br />CURRENT SITUTATION: The Board of county Commissioners established a School Capital <br />Reserve Fund many years ago. This School Capital Reserve Fund has been used successfully <br />for identifying and reserving funds for future School Capital Projects. <br />Orange County has several Capital Projects, in the County Capital Projects Fund, clearly <br />established to serve as a reserve. These projects exist only to act as a reserve for future <br />projects and funds are not expended from the project, but rather transferred to other projects <br />when needed. These projects better fit the definition of a County Capital Reserve Fund rather <br />than a County Capital Project Fund. In a County Capital Reserve Fund the funds can be <br />identified and reserved for specific purposes, but the BOCC can appropriate these funds for <br />individual projects approved by the Board. <br />The Board of Commissioners previously discussed this item at its May 11, 2010 work session. <br />