Agenda - 12-13-2005-9d - Laserfiche WebLink

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ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: December 13, 2005 Action Agenda Item No. ~~ SUBJECT: School Sales Tax Reimbursements -Interlocal Agreements DEPARTMENT: Manager/Finance/Attorney PUBLIC HEARING: (Y/N) No ATTACHMENT(S): 11/28/05 LGC Staff Memo Draft Interlocal Agreement INFORMATION CONTACT: Rod Visser, (919) 245-2308 Ken Chavious, (919) 245-2453 Geof Gledhill, (919) 732-296 Bob Jessup, (919) 755-1800 PURPOSE: To review, comment upon, and consider approving interlocal agreements between the County and each school system that will allow the County to pursue reimbursement for state and local sales taxes paid to contractors on major school capital projects. BACKGROUND: At the September 26, 2005 joint meeting of the Board of Commissioners and the two Boards of Education, a suggestion was raised to explore ways to overcome a recent legislative change that will prevent North Carolina school systems from claiming sales tax reimbursements after FY 2005-06. County and school staffs have further discussed the desirability of creating arrangements under which the County might "own" major school capital projects so that the County will be eligible to file for the sales tax reimbursements. At the November 15, 2005 meeting, the Board directed County staff and attorneys to coordinate with school staffs and attorneys regarding options for developing appropriate interlocal agreements and other documents that will result in the savings of sales tax reimbursements, as outlined by County's bond counsel in documents then presented. County and School staffs met on November 22, 2005 and agreed to recommend to the respective governing boards that each entity should take the steps necessary for the adoption of an interlocal agreement to resolve the sales tax reimbursement issue. Since that time, North Carolina Local Government Commission staff issued the accompanying November 28, 2005 memo that clarified how under certain conditions, a county may assume responsibility for the construction of school facilities and the purchase of supplies and materials, and thereby be eligible for reimbursement of sales tax thereon. County staff have worked with Orange County Bond Counsel to draft such an agreement, which in essence, provides - 1) for the conveyance of property by the School Board to the County; 2) for the immediate leasing of conveyed property back to the School Board, so that the property can continue to be used for school purposes;