Agenda - 11-19-1996 - 9b - Laserfiche WebLink

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2 r Probably the most significant distinction between current practice and future policy is that under Option 5B, funds required to pay debt service will be subtracted prior to remaining funds being allocated between County and School capital projects. Option 5B provides that the funding sources that are currently used for capital and debt service will continue, but that funds for all future and existing debt service (whether County or School) will be subtracted prior to determining annual allocations between County and School capital projects. After debt service is subtracted, remaining capital funds will be divided between County and School projects equally. Other notable changes between old and new funding policies include: • Rescission of past practice of earmarking $750,000 annually to each school system for recurring capital funding. Also rescinded is the plan that would have gradually increased the amount of annual recurring capital appropriations to reflect the split in average daily membership (ADM) between the two school systems. Under Option 5B,recurring capital allocations will be made annually to the two school systems based on the ADM split of the estimated proceeds of 3 cents on the Countywide ad valorem tax rate • Although all half cent sales tax proceeds will continue to be allocated to school and County capital projects and debt service, specific earmarking of"80%of original half cent sales taxes and 60% of additional half-cent sales taxes"to school capital expenditures has been deleted • In order to provide greater flexibility to County and school capital project planning and funding, specific references to certain dollar amounts as the basis for various categories of capital projects have been deleted • The restriction on use of"net two-thirds debt reduction" for health and safety related projects (although this mechanism has not been used since the 1987 policy was adopted) is removed to provide additional funding flexibility • Reference to a five year CIP is removed, as the County has been preparing ten year CIPs for better planning related to educational impact fees Capital Needs Advisory Committee During their review of school capital funding options,the Board of Commissioners also indicated the desirability of their appointing a Citizen Capital Needs Advisory Committee to review stated school and County capital project needs prior to formal decisions on a proposed November 1997 $40 million bond referendum. Staff suggests the Board consider approving an advisory committee that would work with a facilitator between early January and early March 1997 to provide recommendations to the Board of Commissioners concerning composition of a November 1997 bond package. A suggested composition for this committee is: 3 members to be nominated by the Orange County Board of Education; 3 members to be nominated by the Chapel Hill-Carrboro Board of Education; 1 member to be nominated by the Orange County Recreation& Parks Advisory Council; and 6-8 citizens to be selected by the Board of Commissioners at-large. Applications/nominations would be solicited by early December, with appointments to this short-term advisory committee, and a proposed charge to the committee,to be presented to the Board of Commissioners for approval at the December 17, 1996 meeting. RECOMMENDATION(S): The Manager recommends that the Board approve the revised capital funding policy, and approve the conceptual framework outlined for the work of the Citizen Capital Needs Advisory Committee.