June 19, 2013 - 6:00 PM - County Board of Commissioners Meeting Minutes (Special)

10 505 Meeting of the Johnston County Board of Commissioners June 19 , 2013 Special Meeting The Johnston County Board of Commissioners met in special session Wednesday , June 19 , 2013 at 6 00 pm in the Commissioners Meeting Room , Johnston County Courthouse Annex , Smithfield , North Carolina The following members were present Present Chairman Jeffrey P Carver , Vice Chairman Tony Braswell , Cookie Pope , Allen L Mims , Jr , Ted G Godwin , and Chad M Stewart Absent Commissioner Devan Barbour Also Present County Manager Rick J Hester , Clerk to the Board Paula G Woodard , County Attorney David F Mills , Finance Officer and Assistant County Manager J Chad McLamb , and Paralegal Deputy Clerk to the Board Dana Cuddington Chairman Jeffrey P Carver called the meeting to order at 6 00 pm for the purposes of a public hearing to allow public comment on a plan to refinance a portion of the Public Utilities debt and to discuss the proposed Fiscal Year 2013 - 2014 County budget and related matters 1 Public Hearing – Refinancing a Portion of the Public Utilities Debt Advertised in The Smithfield Herald – June 5 , 2013 Upon a motion by Commissioner Allen L Mims , Jr , seconded by Commissioner Ted G Godwin , and carried unanimously , the Board voted to sit simultaneously as the Johnston County Board of Commissioners and the following water districts Archer’s Lodge , Brogden , Buffalo , Clayton , Cleveland , Elevation , Hopewell - Pisgah , Ingrams Township , Little Creek , Little River , McGee’s Crossroads , Meadow , Oneal’s , Princeton - Kenly and Wilson’s Mills Water District Debt and Grant Management Analyst Martha Lasater explained that the public hearing is in reference to refinancing a portion of the Public Utilities debt She reported the bond market is not quite as good as it was when staff originally began looking at refinancing the debt and some of the potential savings have declined Ms Lasater continued that staff originally hoped to refinance approximately 70 million in debt with anywhere from 15 million to 20 million in savings , but if priced today , only a portion of the loans would be worth refinancing for savings She stated staff would like to proceed with the understanding that the refinancing would only occur for the loans where significant savings can be achieved Ms Lasater stated staff is hoping the bond market will improve Upon a question by Chairman Jeffrey P Carver , Ms Lasater stated staff will ask for formal approval on the refinancing plan at the July 1 , 2013 regular meeting and staff will report at that time on the projected savings Chairman Jeffrey P Carver then opened the public hearing by announcing that this was the date , place and hour fixed by the Board of Commissioners for a public hearing concerning a proposed plan of refinancing in an aggregate principal amount of up to 80,000,000 The plan will involve the entry by the County into one or more installment financing contracts with the Johnston County Finance Corporation the “ Corporation ” pursuant to North Carolina General Statutes 160A - 20 , as amended , the proceeds of which would be used i to refinance all or a portion of one or more installment financing contracts previously executed and delivered by the County the “ Prior County Contracts ” , ii to refinance all or a portion of one or more installment financing contracts the “ Prior District Contracts ” previously executed and delivered by one or more of said Districts through the purchase of one or more refunding installment financing contracts to be executed and delivered by one or more of said Districts the “ District Refunding Contracts ” , and iii to refinance all or a portion of general obligation bonds the “ Prior District Bonds ” previously issued by one or more of said Districts through the purchase of refunding general obligation bonds to be issued by one or more of said Districts the “ District Refunding Bonds ” Under said one or more installment financing contracts the County would secure the repayment by the County of the moneys advanced pursuant to such one or more installment financing contracts by granting a security interest in and lien on all or some portion of the District Refunding Contracts , the District Refunding Bonds and , if required , by all or some portion of the projects financed by the Prior County Contracts , the Prior District Contracts or the Prior District Bonds or in all or some portion of the real property on which such projects are located A District’s obligations under its respective District Refunding Contract s will be securedPage506 June 19 , 2013 – 6 00 pm Continued by a security interest in or lien upon all or some portion of the projects financed by the respective Prior District Contract s or in all or some portion of the real property on which such projects are located The plan of refinancing was described in the notice of public hearing published in The Herald on June 5 , 2013 the “ Notice ” The Board of Commissioners acting in such capacity and as the governing body of each of the Districts first ratified and approved the designation of the meeting as a public hearing on the proposed plan of refinancing , the publication of the Notice and the call of the public hearing Chairman Carver asked if there was anyone present that wished to address the Board No one appeared , either in person or by attorney , to be heard on such matter or the advisability of the plan of refinancing and the Clerk to the Board of Commissioners announced that no written statement relating to said matters had been received by the Clerk or the Director of Finance There being no further comments , the Chairman closed the public hearing Upon a motion by Commissioner Cookie Pope , seconded by Commissioner Allen L Mims , Jr , and carried unanimously , the Board voted to adjourn as the Archer’s Lodge , Brogden , Buffalo , Clayton , Cleveland , Elevation , Hopewell - Pisgah , Ingrams Township , Little Creek , Little River , McGee’s Crossroads , Meadow , Oneal’s , Princeton - Kenly and Wilson’s Mills Water Districts and resume regular session Fiscal Year 2013 – 2014 Budget Discussions 2 Johnston Community College Johnston Community President Dr David Johnson and Chief Financial Officer Mike Cross addressed the Board for the Fiscal Year 2013 - 2014 Budget Dr Johnson thanked the Board of Commissioners for their past working relationship with the College He stated the College has never requested anything that was not needed and he asked for the Board to consider a larger allocation than what has been proposed in the County Manager’s budget for Fiscal Year 2013 - 2014 Dr Johnson presented a slideshow of photographs to the Board showing repairs that are needed to the parking lots as well as buildings Dr Johnson stated the College is patching and maintaining as much as they can but the fixes do not last long He spoke on the Wilson Building Front Parking Lot and noted that it was repaved in 2008 at a cost of approximately 800,000 with the County contributing 500,000 to that cost ; however , the parking lot is already deteriorating and needs repairs Commissioner Cookie Pope asked if the Wilson Building Front Parking Lot is deteriorating already because of the poor soil conditions surrounding the College or because of poor quality construction Dr Johnson stated he cannot speak specifically to the workmanship on the parking lot , but he does believe the deteriorating conditions have a lot to do with the terrain at the College Dr Johnson added he believes the problems perhaps could have been alleviated with better engineering and design as well as a better foundation during construction At the inquiry of Commissioner Chad M Stewart , Dr Johnson stated the parking lot deterioration will be an ongoing problem unless it can be fixed correctly which will require funding Dr Johnson expressed his concerns regarding deterioration problems with building structures and roof repairs that are also needed Chief Financial Officer Mike Cross reviewed information with the Board related to increasing costs for utilities and operating expenses as well as past budget appropriations Mr Cross pointed out the overall increase in electric utility costs for the College from 786,364 in Fiscal Year 2011 - 2012 to 836,986 for Fiscal Year 2012 - 2013 He stated the College has requested approximately 419,000 more than what was appropriated in Fiscal Year 2012 - 2013 Mr Cross reported the College is on track to spend 4,271,480 in actual dollars which includes the Elsee Building roof project , for Fiscal Year 2012 - 2013 versus the 4,197,156 that was appropriated by the County ; therefore , the College will have to dip in to their fund balance He noted the 4,197,156 allocationPage507 June 19 , 2013 – 6 00 pm Continued includes the additional 82,000 appropriated from the County in April 2013 which the College greatly appreciated Page508 June 19 , 2013 – 6 00 pm ContinuedPagePage pageNumber5509 June 19 , 2013 – 6 00 pm ContinuedPagePage pageNumber6510 June 19 , 2013 – 6 00 pm Continued Dr Johnson asked the Board to consider allocating 46 million in funding for Johnston Community College for Fiscal Year 2013 - 2014 Commissioner Pope asked if the College had an idea of what to expect from the State Dr Johnson replied the State’s exact allocation to the Community College System is not known at this time , but they are expecting decreases in State funding anywhere from 800,000 to 12 million on top of 12 million in continuing management flexibility cuts Commissioner Allen L Mims , Jr asked about the College’s available fund balance Mr Cross reported Johnston Community College presently has approximately 644,000 in their fund balance , but they are looking at having to pull 75,000 from that balance to meet expenses for Fiscal Year 2012 - 2013 Commissioner Stewart asked if the College had any restrictions on their fund balance amount Dr Johnson stated there are no statutory requirements on fund balance amounts for Community Colleges Mr Cross added the College has internal requirements with regards to their fund balance to make sure reserves are available when needed He stated the College has had to use some of those reserve funds to make needed repairs when necessary Chairman Jeffrey P Carver commented that the County Government facilities also have deteriorating infrastructure so he can sympathize with the College on their building maintenance needs Commissioner Mims asked if any of the bond referendum funds are planned for building and parking lot infrastructure improvements Dr Johnson stated the College is planning for approximately 2 million of the bond referendum funds to be used for infrastructure renovations , but they have 6 million to 8 million in parking lot paving expensesPagePage pageNumber7511 June 19 , 2013 – 6 00 pm Continued alone that are needed Dr Johnson stated the College is also planning to purchase the Smith Property with bond referendum funds ; however , he is trying to raise private funds to cover some of that cost so more bond money can go to renovations Dr Johnson reported so far , the College has about 400,000 in pledges towards the Smith Property purchase and they are hoping to raise 1 million At the request of Chairman Carver , County Manager Rick Hester reported for Fiscal Year 2012 - 2013 the County originally allocated to the College 3,723,631 for Current Expense and 375,000 for Capital Outlay He stated during the year , the County made two additional allocations totaling approximately 98,000 to cover increased expenses the College was facing Mr Hester stated the proposed allocation for Fiscal Year 2013 - 2014 for Current Expense is 3,823,000 and 220,000 for Capital Outlay Mr Hester echoed earlier comments by Dr Johnson stating the County is also facing funding cuts from the State that could potentially impact the County’s budget by about 39 million , factoring in the loss of the lottery proceeds Mr Hester stated he is also very concerned by what is happening at the State level The Board thanked Dr Johnson and Mr Cross for the information Commissioner Mims recognized Johnston Community College Board of Trustees Member Hank Daniels in the audience and thanked him for his service on the Board of Trustees 3 Public Utilities – Water and Wastewater Director of Utilities and Engineering Tim Broome addressed the Board Mr Broome reviewed the following recommended fee increases with the Board • Residential Retail Water Meter Fee The fee would increase from 19500 to 21500 per meter The fee is intended to cover the actual material cost of new meters , and meter pricing has increased • Bulk Wastewater Treatment Commodity Charge An increase of 015 per 1,000 gallons in the commodity charge is proposed The unit commodity charge for treatment would increase from 265 to 280 per 1,000 gallons • Residential Retail Wastewater Assessment Fee for capacity An increase of 300 per dwelling unit is proposed in the residential wastewater assessment fee The fee would increase from 2,400 to 2,700 • Commercial and Industrial Wastewater Assessment Fee for capacity An increase of 125 per gpd is proposed in the commercial and industrial wastewater assessment fee The fee would increase from 1000 per gpd to 1125 per gpd Mr Broome stated the Bulk Wastewater Treatment Commodity Charge increase is needed to keep Fund 68 – Wastewater sustainable until the County can develop the additional revenue source from the Grifols wastewater treatment He stated the Residential Retail and Commercial and Industrial Wastewater Assessment Fees for capacity were established in 2004 and have not been adjusted since that time Mr Broome stated the Utilities Department has requested a Utility Maintenance Technician position in the Fiscal Year 2013 - 2014 budget He stated the Utilities Department has not had any new positions in a long time and although the County’s growth has been flat , the County’s water and wastewater infrastructure has continued to grow necessitating additional personnel Upon a question by Commissioner Cookie Pope , Mr Broome stated even with the fee increases , the County would still be competitive with surrounding counties 4 Public Utilities – Fee for Biosolids Disposal Director of Utilities and Engineering Tim Broome explained that two years ago the County began a pilot project to receive biosolids from Grifols He stated Grifols had been disposing of their biosolids via a composting operation out of county , but they approached Johnston County for an alternative disposal option Mr Broome stated at the time when Grifols approached the County , staff was also working with a consulting engineer on a biosolids study Staff and the consulting engineer , through that study , calculated a fee to charge Grifols to treat and dispose of the biosolids at a rate of 70000 per dry ton for biosolids delivered to the Landfill during the pilot project Mr Broome reported the Town of Clayton has also approached the County for biosolids disposal services in the winter months PagePage pageNumber8512 June 19 , 2013 – 6 00 pm Continued Mr Broome stated staff is respectfully requesting the Board of Commissioners to formally establish a fee for biosolids disposal at 70000 per dry ton delivered to the Johnston County Landfill and 80000 per dry ton delivered to the Wastewater Treatment Plant Following brief discussion , upon a motion by Commissioner Tony Braswell , seconded by Commissioner Cookie Pope , and carried unanimously , the Board voted to establish a fee of 70000 per dry ton for biosolids delivered to the Johnston County Landfill and 80000 per dry ton for biosolids delivered to the Wastewater Treatment Plant 5 Public Utilities – Solid Waste Division Solid Waste Division Manager Rick Proctor stated in the process of drafting the budget for the Solid Waste Division , staff had originally recommended adjustments to the decal fee schedule Mr Proctor stated after further research , staff retracted those recommendations and has drafted a 20 Year Expenditures Plan for the Solid Waste Division to identify all problems , concerns , and options for Solid Waste disposal Mr Proctor requested the Board to set aside time to review the findings in the Expenditures Plan and meet with staff to discuss further Chairman Jeffrey P Carver noted the Board established a subcommittee to look at the Solid Waste Decals and he asked if that committee had been able to meet Commissioner Ted G Godwin stated the subcommittee has not met but he has researched and discussed options in a general nature with the County Manager Director of Utilities and Engineering Tim Broome stated staff has developed a financial model for the Solid Waste Division and with the services being presently provided at the current revenue level , the Solid Waste Division is not sustainable and will be operating in the red in two years Mr Broome stated there are many options to consider and staff has that information available to share with the Board Mr Broome stressed the need to revise the business plan soon Mr Broome informed the Board of an opportunity with Waste Industries to accept some of their out of county waste He explained that Waste Industries has indicated they can divert as much as 15,000 tons a year to the County Landfill at the current tipping fee rates generating 450,000 a year in revenue which is greatly needed Mr Broome stated the County has the personnel , landfill space , and the equipment to handle the additional flow from Waste Industries Mr Proctor asked the Board to consider allowing the out of county waste source from Waste Industries He reiterated Mr Broome’s comments that the County Landfill is set up to receive the additional waste flow and it would help the revenue situation Commissioner Allen L Mims , Jr stated the special use permit associated with the County Landfill property as well as the Solid Waste Ordinance needs to be consulted to see if there are any restrictions on receiving out of county waste County Manager Rick Hester stated he would research the special use permit and the ordinance and bring that information back to the Board Mr Hester voiced his support for the additional revenue source for the Solid Waste Division Mr Broome asked the Board to consider the request as soon as possible Upon a question by Commissioner Cookie Pope , Mr Broome stated the additional waste would not impact the life of the County Landfill 6 Final Comments Commissioner Tony Braswell recognized the various Fire Departments and Emergency Services personnel in the audience Director of Emergency Services Kim Robertson stated there were 12 of the First Responder Fire Departments represented in the audience and she expressed her appreciation to them for their service to the County PagePage pageNumber9513 June 19 , 2013 – 6 00 pm Continued There being no further business , Commissioner Cookie Pope moved the Board adjourn Commissioner Allen L Mims , Jr seconded the motion , which carried by unanimous vote The meeting adjourned at 6 58 pm Jeffrey P Carver , Chairman Paula G Woodard , Clerk to the BoardPage