March 1, 2013 - 8:30 AM - County Board of Commissioners Meeting Minutes (Special)

10 297 Meeting of the Johnston County Board of Commissioners March 1 , 2013 Special Meeting Annual Work Session The Johnston County Board of Commissioners met in special session Friday , March 1 , 2013 in the Pines Board Room located in the Wilson Building at Johnston Community College , 245 College Road , Smithfield , North Carolina The following members were present Present Chairman Jeffrey P Carver , Vice Chairman Tony Braswell , Cookie Pope , Allen L Mims , Jr , DeVan Barbour , and Ted G Godwin Absent None Also Present Rick J Hester , County Manager , Paula G Woodard , Clerk to the Board , J Chad McLamb , Finance Director and Assistant County Manager , Tyson Radford , Assistant Finance Director , Martha Lasater , Debt and Grant Management Analyst , David F Mills , County Attorney , Dana Cuddington , Paralegal Deputy Clerk to the Board , and Lalla Sidbury , Facilitator Chairman Jeffrey P Carver called the meeting to order at 8 30 am 1 Resolutions of Appreciation for Novo Nordisk and Grifols Chairman Jeffrey P Carver explained that he was contacted by Durwood Stephenson who informed him that one of his acquaintances would be visiting with Novo Nordisk and Grifols at their corporate headquarters later this month Chairman Carver stated he asked staff to prepare resolutions of appreciation for the two industries so they could be presented during the visits Upon a motion by Commissioner Allen L Mims , Jr , seconded by Commissioner DeVan Barbour , and carried by unanimous vote , the Board adopted the following two resolutions of appreciation RESOLUTION of APPRECIATION Recognizing Novo Nordisk Pharmaceutical Industries , Inc WHEREAS , Johnston County’s local economy is built not only from a strong agricultural heritage , but also from a strong industrial base ; and WHEREAS , Johnston County recognizes the contributions made by Novo Nordisk Pharmaceutical Industries , Inc towards the betterment of the quality of life for our community through their continued expansions and investment ; and WHEREAS , Novo Nordisk Pharmaceutical Industries , Inc provides much needed employment opportunities for the citizens ; and WHEREAS , the Johnston County Board of Commissioners serve as advocates assisting industries like Novo Nordisk to improve their competitive advantage and profitability NOW , THEREFORE BE IT RESOLVED , that the Johnston County Board of Commissioners hereby recognizes the contributions of Novo Nordisk Pharmaceutical Industries , Inc to Johnston County and expresses our sincere appreciation for their presence and continued growth st ADOPTED , this the 1 day of March 2013 RESOLUTION of APPRECIATION Recognizing Grifols Therapeutics , Inc WHEREAS , Johnston County’s local economy is built not only from a strong agricultural heritage , but also from a strong industrial base ; and WHEREAS , Johnston County recognizes the contributions made by Grifols Therapeutics , Inc towards the betterment of the quality of life for our community through their continued expansions and investment ; and WHEREAS , Grifols Therapeutics , Inc provides much needed employment opportunities for the citizens ; and WHEREAS , the Johnston County Board of Commissioners serve as advocates assisting industries like Grifols to improve their competitive advantage and profitability NOW , THEREFORE BE IT RESOLVED , that the Johnston County Board of Commissioners hereby recognizes the contributions of Grifols Therapeutics , Inc to Johnston County and expresses our sincere appreciation for their presence and continued growth st ADOPTED , this the 1 day of March 2013 Page298 March 1 , 2013 – 2013 Work Session – Continued 2 Introduction of County Commissioner Candidates Chairman Jeffrey P Carver introduced Mr Chad Stewart and Mr Keith Brinson in the audience as the two candidates being considered to fill Commissioner Wade M Stewart’s seat since his passing in January The Board welcomed the two candidates to the work session 3 Work Session Expectations Board Priorities for 2013 The Chairman turned the meeting over to Facilitator Lalla Sidbury who reviewed with the Board the proposed agenda and went over suggested ground rules for the work session Following the review of the agenda and ground rules , the Commissioners briefly discussed their expectations for the work session , as follows • Commissioner Tony Braswell stated he hopes to gain a clear understanding of how to proceed on issues facing the County in the coming year as well as in the future • Commissioner Ted G Godwin stated that being new to the Board , he would like to get a better understanding of the County’s financial situation • Chairman Jeffrey P Carver spoke on the importance of the financial status of the County and commented that the Board can have the best of plans , but such plans will be of no use if sufficient revenues are not in place • Commissioner Cookie Pope added she would like for one of the focuses to be on Economic Development for the County • Commissioner Allen L Mims , Jr stated he is concerned about the County’s financials He noted Johnston County Schools is hoping for another bond referendum and Johnston Community College as well as County Government also has needs Commissioner Mims stated he wants to discuss the upcoming budget as well as how revenues are tracking • Commissioner DeVan Barbour stated the Board often has to address issues that require immediate attention and he is hoping to discuss long range planning during the work session 4 Financial Update – Davenport & Company , LLC Kyle Laux and Bob High , with Davenport & Company LLC , presented the annual financial update Mr Laux echoed earlier comments by Commissioner DeVan Barbour and stated while the Board has to deal with the day to day operations and decisions , Davenport’s goal is to think ahead and focus on multi - year plans Mr Laux reviewed the following points of interest Overview • Despite the severe impact of the economic recession and additional fiscal pressure from the State , Johnston County has been able to maintain improve its strong investment grade credit ratings • As a result of the low interest rate environment and the County’s strong credit ratings , Johnston County has been able to achieve significant debt service savings during the past several years via strategic refinancing of existing debt 85 million in total net refunding savings since 2010 • Multi - year strategic financial planning and adherence to financial policies will continue to be key to maintaining the County’s financial strength , financial flexibility , and credit ratings • As such , in our capacity as financial advisor to Johnston County , Davenport & Company LLC has prepared an updated debt capacity debt affordability analysis for General Fund and School projects Mr Laux reviewed a brief history of the credit ratings , noting the County has slowly increased the ratings with six individual upgrades since 1997 and is now AA + with Standard & Poor’s which is second from the highest rating ; and Aa2 with Moody’s which is third from the highest Page299 March 1 , 2013 – 2013 Work Session – Continued Credit Rating History • Johnston County has enjoyed a trend of increasing credit rating over the past 15 years • The County’s current ratings are in the second highest tier of credit ratings ie , “ AA ” range Commissioner Cookie Pope asked what the County would have to do to achieve the highest bond ratings Mr Laux explained that achieving the highest bond rating involves a multitude of factors He stated the bond rating agencies look at the local economy and its ability to continue to grow and become more self - contained He stated the rating agencies also focus on the County’s continued compliance with the Financial Policies year after year Mr Laux continued that the national economy also affects bond ratings and the County must continue to be smart about long term planning and making sure revenues are available to cover expenses Mr Laux reviewed the following points related to the credit rating • Maintaining the County’s strong credit rating is important for a variety of reasons Most notably they directly translate into lower borrowing costs for new money projects and a greater ability to refinance existing debt than if the County’s ratings were not as high • Compliance with adopted Financial Policies is key to maintaining and or enhancing the County’s credit ratings • The County’s most critical financial metrics are in compliance with its adopted policies , specifically o Fund Balance is now back in compliance with the County’s policy after dropping below the policy level for two years as a result of the economic recession , o The County’s key debt ratios continue to be in compliance with the County’s policies Mr Laux reviewed the Fund Balance information with the Board He pointed out the County was able to bring the Fund Balance back to 15 in accordance with the Financial Policies which is a big plus towards future credit ratings He added the Financial Policies state if the Fund Balance drops below the 15 level , then the County has three years to bring the Fund Balance back into compliance Mr Laux noted the County was able to bring the Fund Balance back to 15 within two years • The County’s Fund Balance was back in compliance with its policy at the end of Fiscal Year 2012 after dipping below as a result of the economic recession Page300 March 1 , 2013 – 2013 Work Session – Continued • Maintaining a strong Fund Balance in compliance with the policy is an important counterbalance to the County’s higher than average debt service versus expenditures ratio Mr Laux continued the presentation with information concerning debt capacity and debt affordability Debt Capacity Debt Affordability • The County last borrowed new money for General Fund School Projects in 2009 • Davenport was asked to analyze the County’s projected o Five Year “ Debt Capacity ” ie , compliance with financial policy guidelines ; and o Five Year “ Debt Affordability ” ie , impact to the annual budget • Davenport has analyzed the County’s projected debt capacity under two scenarios o Scenario One 57 million of new money issued during the Fiscal Year 2014 to 2016 time period ie , three years ; and o Scenario Two 107 million of new money issued during the Fiscal Year 2014 to 2018 time period ie , five years Existing Tax Supported Debt Service • Johnston County continues to maintain a very strong payout ratio with over 70 repaid within the next 10 years • All tax supported debt is paid off in less than 20 years • Peak debt service occurs in Fiscal Year 2014 as a result of targeted savings from refundings that were realized in Fiscal Year 2013 PagePage pageNumber5301 March 1 , 2013 – 2013 Work Session – Continued Debt Capacity Key Assumptions • All new debt is assumed to be structured with one year of interest only followed by 19 years of principal amortization 20 year final maturity o A 425 interest rate was assumed for Fiscal Year 2014 , 450 for Fiscal Year 2015 , and 50 for all debt issued after Fiscal Year 2015 o Debt is structured within the 4 1 rule to achieve level or declining aggregate tax supported principal The first payment is assumed to commence in the fiscal year after the debt is issued Estimated cost of issuance has been included • Tax supported ten year payout ratio is maintained above the County policy of 50 repaid in 10 years Note never drops below 70 • The value of one penny on the property tax rate is projected to generate approximately 11 million in Fiscal Year 2013 Annual growth is assumed to average 25 per year • The Fiscal Year 2013 Budget is used as the base for purposes of projecting the debt service versus expenditures ratio roughly 176 million Future growth is assumed to average 25 per year • Assessed value of property is assumed to be approximately 135 billion for Fiscal Year 2013 Future growth is assumed to average approximately 25 per year Mr Laux reviewed the following debt capacity scenarios with the Board Projected Debt Capacity – Scenario One • Issuing approximately 57 million of new debt during the Fiscal Year 2014 to 2016 time period ie , three years results in the need for additional revenue roughly equivalent to 1 cent on the real estate tax rate PagePage pageNumber6302 March 1 , 2013 – 2013 Work Session – Continued Projected Debt Capacity – Scenario Two • Issuing approximately 107 million of new debt during the Fiscal Year 2014 to 2018 time period ie , five years results in the need for additional revenue roughly equivalent to 25 cents on the real estate tax rate PagePage pageNumber7303 March 1 , 2013 – 2013 Work Session – Continued Comparative Debt Ratios • Comparative Direct Debt vs Total Assessed Value • Comparative Debt Service vs ExpendituresPagePage pageNumber8304 March 1 , 2013 – 2013 Work Session – Continued The Board discussed the debt capacity scenarios presented by Davenport and stressed that a tax rate increase would not be an option to offset any future debt Commissioner Tony Braswell stated the Board’s philosophy is to live within the County’s current tax rate , although other surrounding counties have raised taxes with their bond referendums County Manager Rick Hester stated in all the past bond referendums , the County has structured the debt so it was incorporated into the existing financial model and a tax rate increase was not needed Commissioner DeVan Barbour commented if a bond referendum that required a tax rate increase is proposed , it would never pass in an election by the citizens Chairman Jeffrey P Carver asked about the needs of Johnston Community College as well as County Government and how those projects would be incorporated in a future bond referendum Commissioner Allen L Mims , Jr stated Johnston Community College will have needs , but Community College President Dr David Johnson has not given exact numbers yet , although he has heard the estimates range from 16 to 17 million Mr Hester reported he has shared Davenport’s financial analysis with Johnston County Schools Mr Hester stated he would ask the Board to set aside 3 million to 5 million for County Government needs in a future bond referendum Commissioner Braswell commented that the needs of County Government have been moved to the bottom of the list for a long time and those needs must be addressed at some point Mr Hester also noted the County will soon have to begin radio and tower upgrades for 911 Communications , Public Safety , EMS , and Fire which could cost anywhere from 15 million to 2 million Mr Laux concluded Davenport’s presentation by reviewing preliminary next steps Preliminary Next Steps • May June 2013 County adopts Fiscal Year 2014 Budget • June July 2013 If appropriate , meet with LGC on potential Fall 2013 referendum • November 2013 Hold Fall 2013 bond referendum for County School projects • Late calendar year If appropriate , sell first tranche of Fall 2013 bond referendum 2013 Early calendar Year 2014 The Board thanked Davenport for the information Mr Laux stated Davenport would continue to monitor the finances and provide information as needed 5 Economic Development Report and Discussion Economic Development Director Peggy Anderson provided the Board with an update Ms Anderson reported the Economic Development Office has been working on a business plan at the request of Chairman Jeffrey P Carver Ms Anderson stated late last year , project inquiries decreased and almost stopped prior to the national election , which she noted is typical in a national election year Ms Anderson stated since the election , business traffic has increased and the office presently has four proposals out on projects Ms Anderson stated one of the office’s priorities is to develop and implement a Business Retention and Expansion Program for existing industry in the County Ms Anderson continued that when she meets with existing industries , she often finds they are not aware of all the assistance or programs available to them She stated in an effort to help the industries , she is now trying to coordinate existing industry visits with the Customized Training Director from Johnston Community College as well as the Business and Retention Representative from the Department of Commerce Ms Anderson stated she has also invited Bill Bullock fromPagePage pageNumber9305 March 1 , 2013 – 2013 Work Session – Continued the Biotechnology Center to participate in some of the existing industry visits Ms Anderson reported some of the issues facing existing industries are hiring the right people , training programs , and expansion needs Ms Anderson reported another initiative , which will be included in the business plan , is coordinating quarterly existing industry roundtable discussions She stated the office has hosted two roundtable discussions in an effort to bring the existing industries together to share their issues and needs Ms Anderson stated the first roundtable was in August and was attended by six companies who shared they were having problems with safety and hiring She noted at the second roundtable , she invited representatives from Johnston Community College , the Department of Labor , and the Capital Area Workforce Development Board to discuss these issues with the industries Ms Anderson stated the second roundtable was not as well attended as the first and she asked the Board to help spread the word to the existing industries She stated a third roundtable is scheduled in March and she has invited Johnston County Schools Superintendent Dr Ed Croom as well as Joy Woodard who is in charge of the Johnston County high schools technical programs Ms Anderson also noted the office is placing top priority on new industry proposals She stated typically , the larger projects come from the North Carolina Department of Commerce ; however , she does receive direct calls from interested companies Ms Anderson stated one of the problems the County has is the lack of existing and available commercial industrial buildings She stated the buildings that are available are older facilities with low ceiling heights that do not meet the needs of modern industries Ms Anderson stated there are a number of industrial land sites available in the County and she has been working with some of the municipalities on putting together more properties Ms Anderson reported the County currently has five certified sites through the North Carolina Department of Commerce Commissioner Allen L Mims , Jr asked Ms Anderson if she is informing prospective clients that there are commercial developers in the County that would be willing to offer lease purchase options Ms Anderson confirmed that she does pass that information along to prospective clients ; however , she noted on many occasions , companies are looking at multiple locations and they specifically want existing space that is already available due to time constraints Ms Anderson stated she visits the North Carolina Department of Commerce at least once each month meeting with the representatives to stay up to date on industry development She stated the Economic Development Office is constantly updating their database of available buildings and land which is also connected to the Department of Commerce’s database Ms Anderson reported the office recently revamped the website and completed a PowerPoint Presentation that can be adjusted for specific projects Ms Anderson stated she would like to start attending more of the trade shows to market the County and stay up to date on what industries are doing Upon a question by Commissioner Mims , Ms Anderson stated she expects the natural gas study to be completed by the end of March Commissioner Ted G Godwin stated during his campaign for County Commissioner , the subject of Economic Development was brought to his attention more than anything else and how people want to see more emphasis on a commitment to Economic Development in the County Commissioner Godwin stated Ms Anderson is a wonderful resource for the County through her background and contacts , but he would like to discuss more of a commitment by the County to Economic Development as it relates to more resources and a full time position in the office Chairman Jeffrey P Carver stated the Board has been hearing the same concerns for a couple of years regarding a full time position in the Economic Development Office ; however , when Ms Anderson was hired , she brought her contacts from the Department of Commerce to the County and she can work as many hours per week as needed Commissioner DeVan Barbour commented that at the time when the Economic Development Director position came open , the economy was down and there was no industrial traffic ; therefore , Ms Anderson was hired on a part time basis due to the work flow at that time Commissioner Barbour agreed with comments by Commissioner Godwin and stated the issue of a part time versus a full time position could be reviewed again now that industrial traffic is starting to pick up Chairman Carver agreed that the staffing issue can be reviewed at any time Page0306 March 1 , 2013 – 2013 Work Session – Continued Commissioner Godwin stated he is unsure what the answer is , but he would like to see more time and energy spent with Economic Development for the County Commissioner Mims stated he thinks of Ms Anderson’s position as flex time versus part time in that if a project is going on , she can put in 40 hours per week if needed Commissioner Cookie Pope asked about military projects Ms Anderson stated at the last existing industry luncheon , a representative from the Department of Labor reported that industries are trying to use military personnel in apprenticeship programs to try and gain skilled workers Ms Anderson stated she would touch base with her military contacts about potential opportunities for the County The Board took a ten minute recess 6 Public Utilities – Updates for Water , Wastewater , and Solid Waste Tim Broome , PE , Director of Utilities and Engineering , Chandra Coats , PE , Assistant Director of Utilities , and Rick Proctor , Solid Waste Manager , presented updates to the Board regarding the Water , Wastewater , and Solid Waste operations Water Chandra Coats , PE , Assistant Director of Utilities , informed the Board that presently there are approximately 25,000 retail water customers with an additional 4,100 customers that have purchased taps but are not yet connected She stated there are eight municipalities and two private utilities that receive bulk service from the County Ms Coats reviewed the following supply and growth information with the Board Capacity MGD County WTP – Neuse River at Wilson’s Mills 120 Purchase Agreements Town of Smithfield 20 Town of Benson 05 Harnett County 25 City of Wilson 15 Wayne Sanitary Districts 06 Total 191 These sources have “ sunset ” provisions Water Services Growth • Retail customer base growth is relatively flat • Over the last 12 months , an average of 50 new customers per month have been added • Bulk sales are flat other than Clayton and Aqua NC • Johnston County’s current supplies should meet peak daily demands through 2027 under moderate growth scenario • Added an average of 50 customers per month over the last 12 months Page1307 March 1 , 2013 – 2013 Work Session – Continued Ms Coats outlined the following current water rates for the Board as well as reviewed points on the budget • Retail – 1500 per month min – 310 per 1,000 gallons • Bulk – 200 per 1,000 gallons • Current Capacity Fees – 50000 per unit residential – 300 per gpd commercial industrial • Capacity Fees July 1 , 2013 – 54000 per unit residential – 325 per gpd commercial industrial 3 4 ” water service • FY 12 - 13 Annual Water System Budget 23 M • Current Fund Balance 15 M after debt payments • Johnston County’s water service fees are competitive based on public utilities fees published by the UNC Institute of Government • Fees will continue to require adjustment to – Accommodate increases in operation and maintenance costs – Generate reserves for funding future water supplies Ms Coats continued the presentation by reviewing the near term and long term challenges Near Term Challenges • Comply with US EPA regulations disinfection by - product levels while maintaining quality delivered at each tap • Clarify responsibilities to municipalities that provide retail service from County - owned mains • Complete timely water main extensions to serve citizens with private well supply issues • Adopt a 20 Year CIP Capital Improvements Plan Long Term Challenges • Conclude negotiations for the operating quarry acquisition in Princeton for use in future water supply following mining completion • Develop an alternate plan for a 14 MGD water supply if the operating quarry is not available by 2038 - 2040 • Comply with ever changing federal quality regulations Commissioner Tony Braswell asked if there are still sections of the County where citizens want water service , but it has not yet been made available to them Ms Coats reported there are still portions of the County where citizens would like to receive water service , but to date the County has been unable to extend the lines She explained each year , Public Utilities sets aside funding in the budget to complete water line extension projects in an effort to reach as many of those remaining citizens as possible She stated staff keeps a running list of those areas and will continue to budget funds for extensions each year Commissioner Allen L Mims , Jr asked about the status of negotiations on the quarry acquisition in Princeton County Attorney David Mills reported he spoke to the attorney for the quarry last week who indicated he anticipated having something for the County to review next week Wastewater Chandra Coats , PE , Assistant Director of Utilities , stated the County has approximately 3,000 retail wastewater customers that are mostly located in the Cleveland , McGee’s , and Flowers areas She stated the County provides bulk service for five municipalities and one private utility Ms Coats noted the customer base growth is very flat due to the economy The current treatment capacity is 95 mgd and the current surplus treatment capacity is 27 mgd Ms Coats stated the County’s wastewater treatment capacity should be adequate for 12 – 15 years under a moderate growth scenario Page2308 March 1 , 2013 – 2013 Work Session – Continued Ms Coats stated the FY 2012 - 2013 annual wastewater system budget is 65 million with a current fund balance of 3 million She reported the wastewater fund is financially stressed due to debt incurred for infrastructure to serve residential and commercial growth planned during 2000 – 2008 , and the past two years the annual wastewater budget was balanced using savings Ms Coats stated the County began the last expansion of the wastewater plant in 2006 which was needed to serve residential and commercial growth that was projected as a result of developers reserving capacity and paying deposits for projects they planned , but never came to fruition due to the downturn in the economy She noted a lot of developers have forfeited their deposits Ms Coats reviewed the following rate information as well as near term and long term challenges • Retail – 2000 per month min – 480 per 1,000 gallons • Bulk – 270 per 1,000 gallons to 357 per 1,000 gallons varies based on transmission infrastructure and method of capacity purchase • Capacity Fees – 2,40000 per unit residential – 1000 per gpd commercial industrial – 600 per gpd bulk 3 4 ” water service Near Term Challenges • Keep wastewater fund 68 financially solvent • Negotiate terms and charges with Clayton for interim treatment of Grifols wastewater • Rehabilitate older sewer lines • Adopt a 20 Year Capital Improvements Plan CIP • Extend reclaimed water service with no revenue return Long Term Challenges • Keep wastewater fund 68 financially solvent • Comply with changes in state and federal regulations Commissioner Tony Braswell asked how Johnston County compared with other counties on retail wastewater rates Ms Coats stated Johnston County is competitive with other counties Mr Broome added that the in - town rates of the municipalities , with one exception , are all below the County He stated the out - of - town rates are very competitive with the County’s rate 20 Year Capital Improvements Plan for Water and Wastewater Ms Coats stated staff has drafted a 20 year Capital Improvements Plan CIP for water and wastewater and will be submitting the draft to the County Manager for review this month Ms Coats reported staff will request the Board of Commissioners to review and adopt the plan shortly thereafter She stated a CIP is necessary for sound planning , to identify necessary and fair rate modifications , to qualify for low interest loans and grant funding from State and Federal agencies , as well as it is important to bond rating agencies Solid Waste Services Rick Proctor , Solid Waste Manager , reported on the Solid Waste Services for the County Mr Proctor presented the following overview of services to the Board as well as information on the budget and current fees • Operate municipal solid waste and C & D LCID landfills • Receive vegetative debris and debris from natural disasters • Operate 13 convenience sites for household waste collection and materials recycling • Recycle 14 categories of household and consumer wastes • Transport convenience site waste and recycling materials • Collect special household hazardous waste annuallyPage3309 March 1 , 2013 – 2013 Work Session – Continued • Educate through school presentations and public outreach programs Budget • Total Annual 553 million • Current Fund Balance 747 million • Revenue Sources - Tipping Fees 4,030,000 - Decal Sales 930,000 - Recycle Material Sales 80,000 - Other 490,000 Rates • MSW 35 per ton 33 tip + 2 SW Tax • C & D 27 per ton 25 tip + 2 SW Tax • Vegetative Debris 16 per ton • Decals 65 per year Mr Proctor reviewed with the Board the following current solid waste trends Following a review of the County’s Waste Disposal Report , Mr Proctor reported on the challenges facing the Solid Waste Division dealing with subsidizing recycling , subsidizing convenience site operations , reductions in waste flow , and the associated budget impacts Commissioner Tony Braswell asked to discuss the convenience site decal program Commissioner Braswell commented that the County has discussed the decal program for many years and there are alternatives to the decals He asked if the County is going to look at those alternatives and make some decisions with regards to the decal program in the near future Commissioner Braswell stated it is a challenging issue when considering the municipalities have trash service for their citizens as well as many citizens use a private service Commissioner Ted G Godwin agreed there is a need to talk about the decal program and alternatives Commissioner Braswell stated he personally thinks that the County needs to discuss moving towards implementing some type of parcel fee program He added the County at least needs to come up with a revenue neutral solution Tim Broome , PE , Director of Utilities and Engineering , stated that staff does believe there is a better solution than the decal program He explained the decal program is producing revenue to cover less than 60 of the cost to run the program Mr Broome stated staff would ask the Board to consider an alternative that would generate enough revenue to help pay for the service Upon questions by Commissioner Allen L Mims , Jr , Mr Proctor reported the landfill gas to energy project is moving forward and is presently in the construction phase with the generator startup scheduled in July Page4310 March 1 , 2013 – 2013 Work Session – Continued Mr Broome stated regarding the landfill reclamation fund , it has collected approximately 150,000 to date and he noted those are restricted funds to be used for landfill reclamation activities in the future Mr Proctor concluded the presentation by asking the Board to consider making the convenience sites self - supporting He stated staff will continue to educate the public and make improvements and upgrades to equipment as the revenue becomes available Commissioner Mims asked if staff had explored the option of providing solid waste collection services for Johnston County Schools Mr Broome stated staff performed due diligence work on providing trash services for Johnston County Schools and at the end of their study , staff was not sure that the County could compete with Waste Management who is currently providing the service to Johnston County Schools He stated the County would have to consider the cost of procuring the needed equipment to provide the service and the associated operational costs Mr Broome continued that Johnston County Schools will be bidding their contract in the summer and he recommended the Commissioners ask the Board of Education to stipulate in their new contract with the trash hauler , that the trash picked up at Johnston County school locations must be delivered to the Johnston County Landfill Commissioner DeVan Barbour stated if the Board is going to explore an alternative to the decal program , it would need to be done soon in order to put the new program in place before the new budget year begins Mr Broome stated staff is prepared at any time to discuss the issue further with the Board Tax Administrator Pat Goddard noted that a parcel fee program can become convoluted when considering possible exceptions and she asked the Board to keep in mind that simpler solutions will be easier to administer Chairman Jeffrey P Carver and Commissioner Mims indicated they would prefer to see a user pay type program versus a parcel fee program Following further discussion , Chairman Carver asked Commissioners Godwin , Mims , and Barbour to serve on a committee with staff to research alternatives to the decal program 7 Fiscal Year 2013 - 2014 Budget Update County Manager Rick Hester reported that staff is early in the preparation process for the Fiscal Year 2013 – 2014 budget Mr Hester stated the County is projected to finish Fiscal Year 2012 - 2013 with a 15 Fund Balance He continued that staff clearly understands from the Board there will not be a tax rate increase and the Fund Balance will remain at 15 for the upcoming budget year Mr Hester stated staff will be providing the Board with a draft budget in May for June deliberations He noted for the last couple of years , the Board has waited until late in June to adopt the budget in order to see if any actions by the State would impact the County’s budget Mr Hester stated the North Carolina Association of County Commissioners will be lobbying for the lottery funds and it is one of their top priorities He noted Johnston County should be receiving approximately 45 million annually from the lottery funds ; however , the County is only receiving approximately 22 million each year Commissioner Tony Braswell reported the State’s response on the lottery funds is that there are only 11 counties that use the funds for school construction Commissioner Braswell stated if that is the case , then those 11 counties should be given an exception to be funded at their full lottery distribution amounts Mr Hester stated staff will continue to monitor and update property tax collections as well as the sales taxes in order to have a good estimate of what to expect Mr Hester complimented the Tax Department on their consistently high tax collection rate and pointed out the high collection rate is something that the bond rating agencies have also noticed He reminded the Board that the motor vehicle tax collections will be changing due to the new Tag and Tax Law and staff is unsure how that may affect collections Page5311 March 1 , 2013 – 2013 Work Session – Continued The Board briefly discussed the new Tag and Tax Law and the changes that will come with that program Finance Director Chad McLamb stated the upcoming budget preparation will be challenging and staff will be working with an increased debt service , the uncertainty with the motor vehicle taxes , issues with the Mental Health and Health Department funds , the increasing retirement rate for employees , as well as increasing fuel costs Mr McLamb noted that staff ran a preliminary report recently and the numbers were encouraging so far 8 Compensation Study Discussion Commissioner Tony Braswell explained that a discussion on the possibility of having a compensation study performed was his idea Commissioner Braswell stated the County has not had a compensation study done since the late 1990s and the study is needed to determine a benchmark and if the County is consistent with other counties similar in size Commissioner Braswell stated the County does not operate on the merit pay system , but rather a percentage increase when the County has been able to give raises in recent years Commissioner Braswell also noted that some of the key personnel will be reaching retirement status soon and will have to be replaced Commissioner Braswell stated a compensation study would not mandate the Board to change anything , but would provide useful information with creating a long term plan Commissioner Braswell stated the Human Resources Department could perform the study ; however , he feels it would remove any doubt if an outside firm were contracted Chairman Jeffrey P Carver agreed that a compensation study is needed ; however , he noted that the county salary information is public record and is compiled by the School of Government Chairman Carver stated that he would prefer the County’s Human Resources Department to get that information from the School of Government and compare the data versus hiring an outside firm Commissioner Braswell stated he suggested an outside firm versus the County’s Human Resources Department to avoid the study being seen as slanted one way or another Commissioner Ted G Godwin stated he also would like to see a study done , but agreed with Chairman Carver that it would be easier to extract the data from the School of Government’s publication Commissioner Braswell reiterated he would like to see the study performed whether an outside firm does the work or the County’s Human Resources Department gets the information Director of Human Resources Lu Hickey stated the last compensation study was performed in 1997 and it cost the County 21,000 at that time She noted the County has many more job classifications now and it is her opinion that an outside firm would charge anywhere from 60,000 to 70,000 Ms Hickey reported that staff did a broad view of the salary scale last year and in her opinion , there are 10 to 15 job classifications where the pay grades are below what they should be She stated the rest of the grades appear to be within 5 of the average Ms Hickey noted that they do use the School of Government’s information in their research Chairman Carver asked if the Commissioners were in agreement to have the County Human Resources Department review the compensation ranges and the Board agreed by consent Ms Hickey stated staff could look at the information and have something available by the end of April or early May 9 Board Comments Review of Work Session The Board reviewed the work session and discussed their priorities from the beginning of the meeting Chairman Jeffrey P Carver suggested for next year’s work session , that perhaps Johnston County could partner with another county east of Interstate 95 and hold the work session in that county while their Board of Commissioners could come to Johnston County He also suggested devoting more than half a day to the work session to have more time to discuss the issues rather than just receive updates and information Chairman Carver stated he feels that if the Board were to travel out of County , there may not be as many distractions Commissioner Cookie Pope stated she would prefer for next year’s work session to be held in either January or early February Page6312 March 1 , 2013 – 2013 Work Session – Continued 10 Other Comments Commissioner Tony Braswell reported that he has been working with staff on a pilot project Commissioner Braswell stated he has switched from the laptop to an iPad and he is now receiving all of the agenda materials electronically Commissioner Braswell spoke on the benefits of the iPad noting it costs less than a laptop and because he can receive the agendas in the Drop Box program , there is no need to print documents Commissioner Braswell encouraged his fellow Board Members to consider switching to the iPad when it is time to replace their laptops Commissioner Ted G Godwin noted that he recently met with representatives of JoCo Teen Drivers and he encouraged his fellow Board Members to attend the April 20 , 2013 Teen Drivers Summit After a self - critique of the work session by Board members with the Facilitator , and the conclusion that there was no further business , the Chairman declared the meeting adjourned The meeting adjourned at 11 30 am Jeffrey P Carver , Chairman Paula G Woodard , Clerk to the BoardPage