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9 <br /> Attachment B November 12, 2024 <br /> Article 46 Proceeds <br /> In FY 2012, the County authorized the use of Article 46 proceeds and set a policy of <br /> allocating 50% to school capital and 50% to economic development initiatives. The Article <br /> 46 funds dedicated to school capital funding are commonly used to fund both districts' <br /> technology needs. However, these funds are not restricted for that purpose and can be <br /> used for any Other Capital Uses as needed by both districts. <br /> Recurring Capital <br /> The county also provides a recurring stream of funding for all minor capital expenses, such <br /> as equipment purchases, component replacement, athletic and field repairs. The county <br /> provided $3,060,000 to the districts in FY 2025. This funding %ll-nGrease-is currentK <br /> estimated to increase by 2% annually and will be used to support both districts Other <br /> Capital Uses. <br /> Allocation <br /> For the 10-year period from FY 2025-26 through FY 2034-35, the county will allocate <br /> all funds towards the combined Major Project and High Priority Needs categories on the <br /> basis of approximately 596.86% to Chapel Hill Carrboro City Schools and 40.14% to Orange <br /> County Schools. This allocation is based on the Woolpert Inc. School Optimization Report. <br /> After the expiration of this ten-year period, future Boards can choose either to commission <br /> a new school optimization report to determine future allocation,-Gr revert baGkrever to <br /> budgeted Average Daily Membership or use another allocation method as desired... <br /> For Other Capital Uses, Article 46 proceeds will be allocated annually based on the <br /> budgeted Average Daily Membership for each district, excluding charter students. Recurring <br /> Capital will be allocated annually based on budgeted Average Daily Membership. <br /> Capital Project Ordinances — Project, Function and Purpose <br /> All funds allocated to capital projects are to be accounted for in the School Capital Fund as <br /> authorized by a Board of County Commissioner approved Capital Project Ordinance. Capital <br /> Ordinances can be authorized and amended by the board either annually through the Capital <br /> Investment Plan (CIP) or through budget amendments at any Board Business Meeting <br /> during the year. Each category of expense shall use different rules of authorization for <br /> Capital Project Ordinances to best balance the county's requirement for fiscal oversight <br /> against the need for the districts to manage capital projects quickly and efficiently. <br /> Major Projects will be authorized on a project basis, restricting funds to the specific purpose <br /> identified by the Board. Funds for major projects will be allocated in two tranches, design <br /> and construction. First, the county will authorize the funds to begin designing the major <br /> project through the annual Capital Investment Plan. The county will anticipate authorizing <br /> the construction funds in the following fiscal year for debt management purposes. However, <br /> the bboard <br /> roi-+i iirom Rtc could choose to delay construction funding in the second year if project timing <br /> or other circumstances dictate... <br /> High Priority Needs will be authorized on a project basis, restricting funds to the specific <br /> purpose identified by the Board. These projects will be identified by the school districts each <br />