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3 <br /> Attachment 1 <br /> ORANGE COUNTY <br /> NORTH CAROLINA <br /> April 5, 2022 <br /> TO: Board of Orange County Commissioners <br /> FROM: Bonnie Hammersley <br /> County Manager <br /> Travis Myren <br /> Deputy County Manager <br /> RE: Manager's Recommended FY 2022-32 Capital Investment Plan <br /> We are pleased to submit the County Manager's Recommended Capital Investment Plan (CIP)for <br /> FY 2022-32 for your consideration. This CIP reflects the hope of a return to a new normal for the <br /> County and its residents. It continues to invest in County and School facilities and infrastructure, <br /> but it also introduces new concepts and new technologies to improve resiliency and the County's <br /> path forward. <br /> The most important structural change in this year's Capital Investment Plan is that it extends the <br /> enumerated capital project horizon to ten years. Prior Capital Investment Plans specifically <br /> identified projects in years one through five but grouped longer range projects together in years <br /> six through ten. Although this method provided flexibility, it also confounded efforts to model <br /> the impact of those longer term projects since they could not be tied to a specific year of <br /> expenditure. The new format provides the ability to model the financial impact of investments <br /> over the complete ten year planning horizon. <br /> Although the Board only appropriates funding for projects in the first year of the Plan,the County <br /> employs a debt modeling tool to project debt service requirements and monitor compliance with <br /> the County's debt to revenue policy over the full ten year planning horizon. Projected debt <br /> service ultimately manifests in a tax rate equivalent to pay the annual installments on borrowing. <br /> The debt service to revenue policy measures the County's ability to pay these annual installments <br /> relative to the amount of revenue forecasted. This metric is also used by credit rating agencies <br /> to assign a credit rating when the County issues new debt. The County's current debt policy <br /> target is fifteen percent (15%) of general fund revenues. Based on the County's thoughtful <br />