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44 <br /> o LGC wants to prevent a change in scope such that we <br /> don't finance soft costs and then don't follow through <br /> with the related construction/capital project <br /> o Operating Cost Impacts are projected to understand the <br /> impact of capital projects to our operating budget <br /> ■ Ex: Southern Branch Library staff,utilities, etc. <br /> • Patrick shared that SAPFO frequently discusses how to fund <br /> future growth and renovations of schools <br /> • Bonnie requested that we review the Finance definitions from <br /> the school usage perspective <br /> o Are computers considered capital equipment? Gary <br /> shared that we have financed them in the past <br /> • Bonnie shared that she still has questions about deferred <br /> maintenance. District CFOs had no comments. Bonnie asked <br /> why are maintenance items deferred rather than being funded <br /> and pursued? Requested that we discuss further when we talk <br /> about specific priorities. <br /> • Jean commented that she wondered when we get caught-up? <br /> What are the actual costs to do everything and how do we do <br /> know the funding gap so we can catch up? <br /> • Jean asked about the definition of recurring capital vs capital <br /> asset—are they the same? <br /> o Gary clarified they are different and have different useful <br /> life <br /> ■ Recurring capital items that are debt financed always <br /> match the useful life of the assets with the bond <br /> principal amortization schedule. <br /> ■ The County delineates recurring capital items separate <br /> from longer term projects in its NC Local Government <br /> Commission application. <br /> ■ Ex: vertical building = capital asset but the <br /> furniture inside is recurring capital (shorter <br /> useful life) <br /> ■ The county would like to shift towards using <br /> more PAYGO funding for recurring capital <br /> rather than financing <br /> o Would like to have a better idea of school needs and then <br /> figure out how to finance <br /> • Bonnie asked if ongoing maintenance staff are considered <br /> operating or capital? <br /> o Gary shared they should be operating. If you hire a <br /> project manager for a specific capital project, that could <br /> be financed as a part of the construction cost <br /> o Bonnie shared that if we aren't making improvements <br /> that are needed, it will overinflate our operating budget <br /> causing more needs for handymen to fix ongoing <br />