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3 <br /> c. Funds could be either paid to the District up front, or on an as-needed <br /> basis over the project construction period. <br /> 2. The District could borrow money from a third-party, lender. <br /> a. The District could use most of the tools, regularly available to, North <br /> Carolina local governments, including general obligation bonds, (subject <br /> to a vote of the residents of the District), non-voted installment financing <br /> (which uses the financed assets as collateral for the loan), or revenue <br /> bonds (which pledges net operating revenues of the system as security <br /> for the loan). <br /> b. Because the District will be a new operating entity with a small scope, a <br /> private lender might well ask one or more of the governmental partners <br /> to, provide "moral obligation" backing to a District loan which is a promise <br /> to, consider funding a loan payment that the District could not otherwise <br /> pay. This would be an annual, "subject to appropriation9i promise similar <br /> to the County's commitment to its installment financings and limited <br /> obligation bonds. <br /> Cost Recovery <br /> The District would have most of the same tools to raise revenue as other general <br /> purpose local governments. <br /> • Property tax — a rate would be established annually by the Board of <br /> Commissioners. There is no obligation to levy a separate property, tax within the <br /> District. <br /> • Water and sewer rates, fees and charges including usage fees and availability <br /> fees, as well as capital charges for new service <br /> • Special assessments against benefitted properties — allows the District to collect <br /> funds over a ten-year period. Please note that special assessments can be <br /> assessed to recover less than all of the costs of a project, and that installments <br /> can, but are not required to, include a component of interest over time. <br /> Sales taxes — the District would not share in sales tax distributions <br /> FINANCIAL IMPACT: There is no immediate financial impact related to this discussion. <br /> SOCIAL JUSTICE, IMPACT: The following Orange County Social Justice Goal is <br /> applicable to this agenda item: <br /> GOAL: ENABLE FULL CIVIC PARTICIPATION <br /> Ensure that Orange County residents are able to engage government <br /> through voting and volunteering by eliminating disparities in participation <br /> and barriers to participation. <br /> RECOMMENDATION(S): The Manager recommends that the Board receive this <br /> information and provide direction to Staff as appropriate, especially as to whether the <br /> Board wants staff to pursue the approach of a water and sewer district. <br />