BK: CRPD-39 PG:1 1047-1053' 04-15-2019 BYTODDRABY 10:45:45AM REGISTER  2019002193 MACON COUNTY, NC REGISTERC TODDF ROFDEEDS RABY  NCFEESO00  MACON COUNTY BOARD OF COMMISSIONERS  CONTINUED SESSION FEBRUARY7,2019 MINUTES  Chairman Tatel reconvened the meeting at 12:04 p.m. in the commission board room: as recessed from the) January 8, 2019 regular meeting. AII Board Members (with the exception of Commissioner Higdon), the County Manager, Finance Director, County Attorney, members oft the news media and a number of department heads and county staff MID-YEAR FINANCIAL REVIEW: Finance Director, Lori Hall, presented a PowerPoint presentation that provided thel board witha a mid-year financial update for Fiscal Year 2018- 2019. Ms. Halli noted that, in comparing the current fiscal year to thej prior one, sales tax revenue was up by just moret thans seven percent, property andi motor vehiclet tax collections were: approximately $756,000 higher than the same time in last fiscal year. She also gavet the board as snapshot oft the County's general fund debt, including principal and interest payments by fiscal year. Ms. Hallj pointed out that thes slight increase in the debt for next fiscal year was duet tot ther recent debti issuance for the South Macon Elementary School renovations project. Since the debt wasi issued this fiscal year there will only be one principal andi interest payment, and thens startingi inl FY 2019-20201 there willl bet two principal andi interest payments, going forward. No action was necessary. 2018) YEARI INI REVIEW: County Manager Derek Roland gave thel board an overview of the accomplishments: and challenges that Macon County facedi in 2018. Mr. Roland stressed howt this was ani important time oft the yearl looking forwardt tot the next budget. He pointed outt that 2018 was a great year with another unmodified opinion on the County's financial audit, there was ani increase to fund balance, the County is moving forward witht the Capital Improvement Plan (CIP),completion of thel Robert C. Carpenter Building project, $350,000 was allocated to the Highlands Civic Center, and there was an increase to the Macon County School System's capital outlay. Inj public safety, hej pointed out that six new patrol vehicles were) purchased for the Sheriff's Department and that the roof replacement was completed on the Macon County Detention Center. He: said thel best accomplishment was that the County was able to continue toj provide efficient and quality services tot the citizens. Moving into 20191 he) pointed out that the budget was developed to enhance service quality, especially inl Public Safety while simultaneously dealing with the increases tot thel health insurance costs, retirement, detention center costs, and inmate transport. Highlights of this budget are the Space Needs Analysis that is currently taking place, and Mr. Roland is optimistict that this) project willl be completed soon. The County increased funding in this budget tot thel Macon County School System. The Maintenance Department is also currently replacing all oft thel lightbulbs in County buildings with LEDI lights that will pay for itselfi in thef first year. There has been $400,000 budgeted tot the expansion of broadband in Macon County. While the: services havel been enhanced, therel havel been obligations that will impact thel budget inl FY2019-2020 in the: absence of corresponding revenue. This impact  were present.  Minutes 02.07.19 Page 1of7    could be' 'dramatic." Mr. Roland then presented a breakdown oft the unassigned fund balance. The County received two times the Medicaid Cost Settlement funds that normally are not received. Furthermore, in CIP discussions previously had one oft thej parameters was tot transfer $300,000 of excess sales tax revenue whichi is critical in the CIP process. Fiscall FY: 2018-2019 included: at two percent cost ofliving increase to County employees, an increase in retirement contribution, increase in the health insurance costs, school technology, two! School Resource Officer positions for al halfa aj year, and two Courthouse Security positions. Mr. Roland: said that when youl look at allt the obligations that have been incurred: in 2019 and) look what wel havel leftover in 2018i in the absence of corresponding revenuer we: are: actually "flat, or right there ati it." The County will also willl have: some obligations in 2020, as well. First and foremost, ist the employee pay grade adjustment, mainly tweaking in some." specialty positions," especially int the Health Department. Mr. Roland also said that health insurance cost is something elset that will needt to bel looked at strongly. Additional employees in the Department of Social Services and Courthouse Security are going tol be requested in the upcoming budget. The County fleet is aging with 292 vehicles (not including transit vehicles) and an average age of12.7 years and will need tol be looked at closely int the upcoming budget. The $1.3 million for the Fire Safety Training Facility that was to come out oft the fund balance is still out there, and will come with operating costs. The OPEBI liability is goingt toi increase due to a change in GASB: 75. There also could be an impact duet tot the Statel budget. Mr. Roland credited the board for theirl leadership andt thej position the County is in and moving forward witht the CIP. He also pointed outt that ad valorem tax was the County's most consistent and reliable revenue. Looking forward, he: said that the County needs to make sure the revaluation is accurate and gets the County wherei iti needs tol be with consistent revenue as we move into 2020. AMENDED CAPITAL IMPROVEMENT PLAN: Mitch Brigulio, a Senior Vice President with Davenport & Company, presented a PowerPoint presentation on year two of the County's proposed Capital Improvement Plan (CIP). He started by explaining that year one was really a "testing the waters" step and that this year would be' "refining the plan" andt that next year ist the real critical year when the County will put this plan into motion andi it can bet tracked for years to come. The Space Needs Analysis thati is currently inj process willl be a big piece oft this plan that can be used to make a firm action plan for the County to move forward. He discussed the County's credit rating and what the County could and could not control wheni ito comes toi impacting its potential credit rating. These factors included the economy/tax base, finances, andi management/policles. Mr. Brigulio also said the County is in" "great shape" when ito comes to fundl balance. He said thel board may wantt to consider adopting: a formal policyf for the 25% fund balance that the County already informally hasi in place. He alsot talked about key debt ratios and the said thel board may also want to consider developing: aj policyl level that allows the County to accomplish thet things that need tol be donei in the CIP but doesn't! limit the County unnecessarily. Commissioner Beale stressedt thatl he felt thel board needed tol be careful setting that limiti in case another recession hits. Mr. Brigulio then discussed the Countys'affondability and said the County has done a really good jobi identifying revenue sources to fund debt service: and capital  No action was necessary.  Minutes 02.07.19 Page2of7    projects andi implementedi thati int thel budget process. Het then gave four different scenarios of what the County may want to dol based on what thei initial department head and outside agency requests that were received: and updated in this year's CIP. The County Manager saidt that thel board will determine the priority oft the projects. Mr. Brigulio said that the CIP can be finalized and adopted during thel budget process. No action was necessary. 2019) REVALUATION UPDATES: Tax Administrator Richard Lightner told thel board that thet tax notices havel been out a couple of weeks now and that the values basically remained flat. He stated thata a difference in the growth pattern can be seen and that is why youl have ar revaluation. Downtown Highlandsi is the' hotspot" now whereas Franklin has not grown in fifteen ori more years. Mr. Lightner saidt that this becomes aj problem when you try to leverage out where your growth is and wheny you are talking about revenues. He briefly discussed thei issues of vacant buildings and commercial rental costs. He also saidt that Inspections revenue was down but the Register of Deeds revenue was up so that shows values are going up, butj just not strong. He said all oft this ties together with revaluation; the County has tol be equitable tot the people and classes around them. He: said that when figuring out the] FY2019-2020 the tax rate cannot go down, but willy not go upl likei it did four ors sO) years ago. However, your may have tol had two cents ands see what your new budget needs are and then evaluate from there. Collections are up, and the County remains tol have thel highest collection rates the past two years. Ini the) January report the collection ratei is 94.25% compared to 93.9%1 this timel lasty year. Mr. Lightner said right nowi is the time for appeals andt that his department is only seeing 1.2% appeals at this time, whichi is substantially lowert than he has hadi in a number ofy years. Hei informed the board thata a COURTHOUSE SECURITY UPDATES: Sheriff Robert Holland and Chief Superior Court Judge William Coward presented a Courthouse Security update tot thel board. Sheriff Holland saidt that about two years ago the] Judge and) himself brought to the board's attention some: security concerns that they had. Sheriff Holland informed thel board that thet twenty-seven member committee and the) Judge have some recommendations to make based on their review and the review of thel NC Sheriff's Association and the US Marshall Service. The original recommendation that the) Judge and the committee wanted to make was one entry into the Courthouse. However, the Sheriff said thati in order for the one entryway tol be successful there would be: al lot of costly needs that will come outi in the Space Needs Analysis that ist taking place now. The Sheriff saidl he understands thatt the funds are not currently available right now to do the one entrance, so the committee's recommendation is tol havet two entrances to the Courthouse. With two entryways, the County will only be eliminating one entryway. Hej presented the approximate $58,600 cost oft the equipment (x-ray machine and metal detector)t to the board and explained that 20,000 people came intot the Courthouse related tot the) Justice system alone. The Sheriff said they are ready to move forward witht this and willl be requesting four new positions in order for thist tol be successful. Judge Coward toldt the board his concerns about security ands said that these efforts are: a way to: secure the buildingi into the unforeseeable future. Commissioner Gillespie encouraged the Sheriff tol looki intol leasing this equipment duet to  large growth will not be: seen. No action was necessary.  Minutes 02.07.19 Page 3of7    the rapidly advancing technology. The board asked the County Manager tol have the equipment costs (purchase versusl lease) and operating costs prepared for themt to review FY2019-2020: SCHOOL: SYSTEM TOPICS: Macon County Schools Superintendent Dr. Chris Baldwin started by expressing his gratitude to thel board for the additional resources that were given to thes school's this year. He gave thel board an update on the South Macon Elementary: School renovations. He explained that the additional funding given to the schools have: allowed fori iPad replacements, active boards, additional security, matching funds for two: SRO's that were very much needed, thea addition of security fencing, access control tos several locations, alarm systems, camera systems, and mosti importantly they weres stilla ablet to avoid ar reduction in the overall services that are provided to thes students. Angie Cook, Finance Officer for thel Macon County School System, updated the board with the current expense oft thes school, and capital outlay update like Dr. Baldwin previously mentioned. Dr. Baldwin presented lists ofi items fort the County's school system for the upcomingyear. The capital outlay requests included items concerning: structural safety for several schools such as classroom door locks for Franklin High School and fencing for Highlands School ands South Macon Elementary School. Commissioner Beale stated that aftera a liaison meeting that he and Commissioner Shields attended they agreed that safety isap priority. Dr. Baldwin stated that this list has not been prioritized by the school board at this time. Thisl ledt tos specific discussion about the track at Franklin High School. Dr. Baldwin stated thati ift they can get through this track season that it willj probably be thel last for thet track at FHS. The question then becomes what do you do with the track? He said the option could be tor resurface thet tracka at Macon Middle School, andt then stressed his concerns withy what happens to the track atl FHS once iti is done. After reviewingt the list of other capital outlay items, Dr. Baldwin then presented the board with a list of Macon Middle School renovations that are needed. This ledt to al lengthy discussion where Commissioner Beale reported that after thel liaison meetingandi meeting with thes school maintenance, therei ist nothing more pressing than Macon! Middle School. Hes said' "the needs aret there from the windows, tot the roof, to everything on the list - iti is all aj priority." The County Manageri is going to report back to the board what the architect's quote willl be on the next scheduled meeting. Dr. Baldwin ended withi reviewing thes school's budget priorities for FY2019-2020 including the concern of whati impact the statel budget could have. He also: said they would liket to address trauma-impacted. students, retain and recruit quality employees, improve technology, and thei importance of the STEM program. No FIRE: SAFETY' TRAINING FACILITY UPDATES: Dr. Dan' Tomas, President, Southwestern Community College (SCC) presented an update tot the board on what has happened in the past year regarding thel Fire Safety Training Facility. He informed thel board that SCCI hired Stewart Cooper Newell Architects for this project and they performed a cost estimation. The original budget for thej project was 2.712 million and the cost estimate camei in at 4.035 million whichi is approximately 1.3 million short. Dr. Tomas explained that thet there wasa large difference int the price of sitej preparation than originally estimated. Some otheri items  att ther next meeting. No: action was necessary.  action was necessary.  Minutes 02.07.19 Page 4of7    that caused the difference were the taxes, sub-bonds, and general contractor markup for the oversight oft the building delivery. Dr. Tomas then presented thel board with the possibility of usingt the National Guard Armory Building that will be given back to the County. He: said this isa aj perfect opportunity for the Public Safety Training Facility to grow and the burn building can be moved to this location instead. The County Manager informed thel board about his conversation with the National Guard and that they are consolidating and willl be vacating this building andi it will be given back to the County, but also saidi it could be January 20201 before this happens. After discussion with thel board Dr. Tomas feels thati itis worth waiting for and that in the meantime they can work out some details so that the process can move forward when the time comes. No action was necessary. PRESENTATION OF THE BUDGET CALENDAR: The County Manager presented his FY 2019-2020 Budget Calendar for thel board's consideration, a copy of which is attached (Attachment 1) andi is hereby made a part of these minutes. No action was necessary. GOALS ANDI EXPECTATIONS FORI FY: 2019-2020: Each board member was given the opportunity to comment on their goals and expectations for the upcoming budget. Commissioner Shields said he liked the goals that the North Carolina Association of County Commissioners had released and that "you feel good when you develop a goal and Commissioner Beale, said "our goals, as far as am concerned, have pretty much been outlined for us" and iti is good news about the financing options wel have. He said there are some big decisions to that will have tol be made but he would like to wait to and see what the results of the Space Needs Analysis are. However, there are somethings that need to go ahead and be done, such as Courthouse Security and Macon Middle School renovations. Commissioner Shields then said he would alsol like to refocus on Nantahala and their situation there with the Library. He wants to do something for this community and what their needs are. The County Manager told Commissioner Shields and the board that they have been included, along with the Nantahala recreation park, in the Space Needs Analysis. Commissioner Gillespie said) he agrees with Commissioner Beale about the goals being presented to them and that there are some hard decisions to be made. He also said that he would like to look at efficiency and effectiveness of government. He stated that the County staff does a greatj job but that there is always room for improvement in saving money and Commissioner Shields said that it may be more ofa planning board goal but that he doesn'twant tol lose focus on Angel Medical Center and would like to stay involved in Chairman Tate said) he was going to be a lot more specific with his goals. He stated that he would like to see: some lingering construction and money accounts cleaned up, such as Peek's Creek and other housekeeping that could potentially move some money backi into fund balance, especially with the capital projects the board could be facing. Chairman Tate acknowledged the issues withl health insurance costs and said, speaking for himself, that if fund balance needs tol be used to help supplement and steady that account moving forward, that he trusts the County Manager's judgment in that decision. He said obviously  you got that whole group) with you."  ins services provided.  things like thel Dogwood Foundation.  Minutes 02.07.19 Page5of7    Courthouse Security is aj priority and he wants to get that moving. He said the dog park will have to be moved and wants that on everyone's radar. He: acknowledged thati itis revaluation year and said he would) have to trust the County Manager's judgment and after listening to what is going on with the schools and security he understands that the County Manager willl have to make a recommendation of what the tax rate needs tol be in order for BUDGET AMENDMENT: Lori Hall, Finance Director, presented al budget amendment to the board for $61,625 for a grant received by the Soil and Water Conservation District to do the Blueways Canoe Access project. The funds were received last fiscal year but the project was not completed. Bids have been received and the project is ready to: start so this budget amendment is to appropriate fund balance for the revenue received last year. Upona motion by Commissioner Beale, seconded by Commissioner Shields, thel board voted 4-Oto ADJOURN: After some final comments, and at 3:38 p.m., upon: a motion by Commissioner Beale, seconded by Commissioner Shields, the board voted 4-01 to adjourn.  those needs tol be met.  approve the budget amendment.  BLE Derek Roland Ex Officio Clerk to the Board    Jim Tate Chairman  Minutes 02.07.19 Page 6of7    Appendix 1 COU  MACON COUNTY FY2019-2020 Budget Calendar  February 7,2 2019 February 14, 2019 March 15, 2019 March 22, 2019 March 25-29 & April 1-5 April 15,2019 May 14, 2019 May 15, 2019 - until June 11, 2019 @ 6:00 pm June 11, 2019 @ 6:00p pm  Mid-year review with BOCC BOCC receives FY 2019-2020 budget calendar Preliminary Budget Meeting with Department Heads Departments complete line item budget input and return hard copy requests and narratives Print line item budget for County Manager Review County Manager meetings with Department Heads as needed. Macon County Schools and outside agencies budget requests due Manager's recommended budget presented to BOCC with message; distributed to department heads; posted on county webpage Work Sessions with BOCC Public Hearing on the budget BOCC adopts budget  Minutes 02.07.19 Page7of7