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28 <br /> Based on County staff discussions with Local Government Commission <br /> (LGC) staff over the last few months, it is important to note, that the LGC <br /> considers capital leases as outstanding debt for County governments. <br /> b) "Large Developer' Status <br /> For the most part, local communities view school systems and <br /> governmental agencies as "large developers". While this situation offers <br /> purchasing advantages on some fronts, it is also a situation that staffs <br /> must manage effectively. Being viewed as a "large developer" often sets <br /> "higher than normal" pricing standards in the construction market. As an <br /> example, past practice has been that local governments and school <br /> districts make construction project budgets known before the bid process <br /> beginning. An unintended consequence of this practice has been that <br /> development and construction markets tend to "re-adjust" their standards <br /> upwardly, and bids more than likely come in at the "pre approved" level or <br /> higher rather than coming in at less than the "pre-approved" level. <br /> c) Value Transference to Stakeholders <br /> "Value Transference" is defined as the value that an external entity or <br /> stakeholder receives when schools and governmental entities such as <br /> counties or towns invest in particular communities. Individuals, <br /> businesses, and other public as well private entities benefit from school <br /> and other governmental capital investments into a community. The impact <br /> of such investments should be recognized in development practices and <br /> principles relative to the potential revenues from the private sector that this <br /> value transference creates. For example, schools and co-located <br /> recreational facilities inure to the retail value of residential building lots and <br /> existing homes. This value transference to the owner and/or developer of <br /> this real estate may be recouped in the form of impact fees, transfer taxes <br /> or other reasonable proffers. <br /> d) Financial Strength <br /> Strong financial conditions of Orange County and both the Chapel Hill <br /> Carrboro and Orange County school districts should allow for negotiating <br /> positions and purchasing power within land use design, development and <br /> operations. <br /> All of the practices outlined above offer guidelines to consider as each district <br /> proposes new school construction projects. <br /> 15 <br />