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(Adopted 12/7/96) <br />(Revised 2/3/98) <br />Orange County Board of Commissioners <br />Capital Funding Policy <br />A. Sources of Funds <br />The following sources of funds will be allocated for Capital Projects and Debt Service: <br />1. All proceeds from the Article 40 and Article 42 one half sales tax <br />The North Carolina General Statutes require that 30 percent of the Article 40 and 60 <br />percent of the Article 42 sales tax revenue be earmarked for school capital projects or <br />debt service on debt issued for school capital projects. <br />2. Revenue from the property tax as follows: <br />• $800,000 <br />• The equivalent of 2.7 cents on the tax rate based on valuation as of 1996-97. <br />This earmarking will be adjusted each revaluation cycle. <br />• The amount necessary to retire the 1992 School Bonds. (In 1997-98 this amount <br />is $4.7 million.) <br />• The amount of the reduction in the Human Services function of the County <br />budget (equivalent of one half of one percent of the budget or $50,000) in 1994- <br />95 for automation projects in Human Services. <br />• Utilities Extension Fund -This amount may vary in that it based on the increase <br />in property tax base as a result of expenditures in the Utilities Extension Capital <br />project. The amount currently planned is $35,000 for 1997-98 and $25,000 for <br />each year thereafter. <br />3. Impact Fees for each school system. <br />4. Public School Building Fund <br />5. Other revenues that are restricted including, payment-in-lieu, grant funds, rental revenue <br />and inmate fees as a result of the new jail addition. <br />B. Debt Service <br />Prior to funds being allocated for specific projects, all debt service, including private placement <br />financing will be subtracted from the unrestricted funding sources. As an exception, the <br />Orange County Schools are responsible for funding directly from their pay-as you-go capital <br />allocations, that portion of the cost of a new high school in the Orange County School system <br />beyond the $12.5 million bonds approved by voters for that school in November 1997. <br />C. Allocation <br />All sources of unrestricted revenue, less debt service, is then allocated between County and <br />School projects based on 50 percent of the net amount for School projects and 50 percent of the <br />net amount for County projects. Funding between the two school systems will be allocated <br />based on the 20`" day enrollment adjusted each year. For example, the 20`" day enrollment as of <br />