Reference Materials for 01-25-2019 Board Retreat

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51 Attachment 4- B Economic Development Intergovernmental Cooperation Opportunities Brief Historical Overview As a brief review of Article 46's origin in late 2011 and the intended outcomes for Orange County, recall the economic environment at that time, both nationally and at the state and local levels, which was entering a deep economic recession causing severe budget shortfalls, rising unemployment and stagnant business growth. At the Orange County level, leadership recognized an immediate need to assist our residential homeowners, who have traditionally shouldered the largest portion of the County's annual revenue contribution, by finding ways to diversify the local tax base toward greater non-residential revenue sources (such as increased retail sales taxes, and attracting the presence of more large scale commercial and light industrial property taxpaying generators). The strong recession at that time also presented real threats to Orange County's current and future educational funding commitments for public schools, and so Article 46 was also proposed to assist that area to maintain our community's strong level of annual financial support for our local school systems. New ideas began to emerge about how to stimulate entrepreneurial, home-grown technologies, further support the local agriculture and food systems character of our region, support our many small businesses, and, encourage the growth and attraction of larger corporate taxpayers. The County's long-standing economic development districts, which had existed dormant for over 25 years, without the aid of appropriate zoning, water and sewer utilities, recruitment incentives or marketing to actually aid our economy, were determined to be critical assets that should finally receive capital support and help make them become more productive drivers for the County's long-range economic vitality. A focus to finally emphasize those economic development districts and commercial transition nodes, which are all located along the rural interstate highways,became a main envisioned use of Article 46 funding to be allocated for the County's economic development program. As a result, Board of Commissioner leadership, supported by the strong endorsement of public and public agencies, the two Chambers of Commerce, and our locally elected officials, proposed to enact a supplemental "1/4 cent retail sales tax" in early 2011. Following a year-long public information campaign on the merits of the proposed '/4 cent sales tax and its' uses, Article 46 was successfully passed by Orange County voters in a November 2011 referendum. The Orange County's Board of Commissioners then adopted a Resolution in December 2011 to outline the purpose of the new"Article 46" funds. This new revenue stream was determined to equally fund both education and economic development, and, for an initial 10-year test period. The core uses of Article 46 as proposed to voters in 2011, today generally follow the same key programs that were adopted in the Resolution by Board of County Commissioners 7 years ago. The County received the initial Article 46 funds from the N. C. Department of Revenue beginning in the spring of 2012. Since that first year, annual revenues (estimated at a total of $2.5 million in 2011) are split 50150 between Education(for Orange County Schools & Chapel Hill/Carrboro City Schools) & for the County's Economic Development program, with each group receiving approx. $1.25 million for that year. By 2018, the County's total Article 46