Orange County NC Website
Browse       Search
3 <br /> As the amount of outstanding debt paid from property taxes is retired and the annual <br /> amount of the debt service payment is reduced, funds would continue to be earmarked <br /> for school capital at the 1999-2000 peak level. Debt service payments decrease by <br /> around $360,000 each year. For years presented in this plan (through 2005-06) these <br /> funds are allocated to the Orange County Schools. For years beyond those shown in <br /> this report, one option is to allocate these funds to each School system based on <br /> average daily membership (ADM). <br /> 4. On-going School Capital Projects (projects other than those listed in #1 above that <br /> are included in the Capital Improvements Plan) <br /> The proposed bond referendum includes about $6.8 million for ongoing School capital <br /> projects. In the present Capital Improvements Plan, the private placement payment for <br /> the Chapel Hill/Carrboro City Schools Elementary School #8, the addition to East <br /> Chapel Hill High School and the debt service on the new Orange County Schools <br /> elementary school is paid from capital funds after the funds are allocated. In Option 5 all <br /> debt service is deducted before funds are allocated to the County and to the Schools. <br /> In comparing the impact of Option 5 to the Schools' capital plans, the bond proceeds <br /> and private placement financing are excluded. What remains are on-going capital <br /> projects. Attachment 2 compares existing funding to funding that would be available <br /> under Option 5. This comparison shows that over the nine years included in the planning <br /> period, Chapel Hill/Carrboro City Schools would receive $2.5 million less than under the <br /> present Capital Improvements Plan. The Orange County Schools would receive about <br /> $4.1 million less than under the present Capital Improvements Plan. <br /> A variation of this option is also shown at Attachment 2. In Option 5A, recurring capital is <br /> excluded from the calculations. Recurring capital in this plan would be paid from the <br /> General Fund and is equivalent to roughly three cents on the property tax rate. In this <br /> option, the equivalent of three cents on the property tax rate is specifically earmarked for <br /> recurring capital, with funds allocated to each School system based on student <br /> membership. Growth in recurring capital funding would be equivalent to growth in the <br /> tax base. <br /> Shifting recurring capital outside the capital formula adversely impacts County projects. <br /> Over the nine year planning period, County projects would total around $5.5 million less <br /> than the amount currently in the Capital Improvements Plan. The first year of hardship <br /> for County Capital Improvements Plan projects would be 1998-1999. There are several <br /> possible options: <br /> • Shift the one cent currently earmarked as a Capital Reserve Fund to <br /> County projects. By 1998 this Reserve Account will have a balance of <br /> just over$1.5 million. <br /> • Increase the General Fund property tax rate by one cent in 1998- <br /> 1999 with these funds earmarked for County Capital projects. <br /> • Adjust the allocation of the Schools and County from the 50-50 split. <br /> To hold County projects "harmless" the allocation would need to be <br /> 67 percent for the County and 33 percent for the Schools. This would <br /> reduce the amount available for the Schools over the nine year <br />