Agenda - 06-20-2017 - 8-a - Minutes

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21 1 Chair Dorosin said he is less concerned about the Moody's data, and there are some 2 metrics, for which the County does not currently have policies, and perhaps adopting these 3 would alleviate concerns about lowering the fund balance percentage. 4 Mitch Brigulio said there is no one metric that will impact the County's credit rating, but 5 rather the aggregation of everything. 6 Chair Dorosin said the question is how important is it for them to get ahead of these 7 expenses, and could they continue to be managed in an incremental way. He said if the County 8 needs these funds, then access them, and if not, keep them in the fund balance. He said he 9 knows this is a policy question, but asked if the Manager would give her educated opinion. 10 Bonnie Hammersley said there are great needs for the County and the Schools, and the 11 Board needs to start looking at how it will address the long-term implications of the 12 maintenance of the school and County facilities. She said there are times when it is important 13 to look at what needs to be done, and take a strategic approach on how to accomplish the 14 needs. She said it is important to identify one-time expenses to be paid for with one-time 15 funds, and recurring expenses to be paid for with recurring funds. She said the recession got 16 the County off course, and she assumes there was an accumulation of fund balance because 17 of the fear of uncertainty that the recession brought. She said this accumulation has somewhat 18 hurt the County, as it was infused in the budget and put toward on-going expenses. She said 19 this should not happen moving forward, and any fund balance surplus should go toward a one- 20 time expense. 21 Commissioner Jacobs said he has been on this Board when the fund balance was 10%, 22 and the County did not have a bad rating. 23 Paul Laughton said he remembers that percentage as well, and the County had an AA 24 rating. 25 Commissioner Jacobs said the County needs a grander strategy than just the fund 26 balance. He said he does not want to hoard taxpayers' money, especially with tax increases 27 coming, and a new strategy is needed by the next fiscal year. 28 Chair Dorosin suggested using this for discussion topic for the agenda at the BOCC 29 retreat. 30 Commissioner McKee said he finds that to be too late, and the Board needs to start 31 developing a strategy to address the capital needs by their first meeting in the fall. He 32 reiterated that this is a one-time fix, and the fund balance percentage cannot keep dropping. 33 Commissioner Burroughs said a strategy is important. She said the County needs to 34 try and keep its AAA bond rating, but she has been convinced by discussions with Davenport 35 that the Board can go below 17% and keep its AAA rating. She agreed with Commissioner 36 McKee that this change can only be done once. She said taxpayers give the County money for 37 a reason and, if there is a level of savings that will keep the County fiscally responsible, the 38 Board should not hoard the tax dollars. 39 Commissioner Marcoplos said he has heard nothing that would make him worry about 40 their AAA rating, and Orange County is not the only county that is looking at monies from its 41 fund balance. 42 Commissioner Marcoplos suggested going to 16% for the fund balance, which would 43 be another $200,000 this year. He agreed that a grander strategy is needed. 44 Commissioner Rich agreed with Commissioner Marcoplos about going to 16%. 45 46 A motion was made by Commissioner Burroughs, seconded by Commissioner Rich to 47 change the policy for their fund balance reserve to 16%. 48 49 Commissioner Jacobs asked if the annual fund balance and bond rating for last 20 50 years could be provided.