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HomeMy WebLinkAboutMay_22_2014_Budget_Session_MinutesMay 22, 2014 IREDELL COUNTY BOARD OF COMMISSIONERS BUDGET SESSION MINUTES Mav 22, 2014 The Iredell County Board of Commissioners met on Thursday, May 22, 2014, at 5:30 PM, in the Iredell County Government Center (South Wing Conference Room), 200 South Center Street, Statesville, NC. Board Members Present Chairman Steve Johnson Vice Chairman Marvin Norman Renee Griffith Ken Robertson Staff present: County Manager Ron Smith, Deputy County Manager Beth Dirks, Finance Director Susan Robertson, Assistant Finance Director Deb Alford, and Clerk to the Board Retha Gaither. CALL TO ORDER by Chairman Steve Johnson and turned the meeting over to County Manager Ron Smith. Mitchell Community College — Dr. Ralph Bentley, Chairman of the Board of Trustees, expressed his appreciation for the funding and support by the Board of Commissioners. President Tim Brewer echoed Dr. Bentley's comments. He introduced the new Vice President John Wilkinson. He explained they are in the process of a market analysis and seeking the input from the community for their long range strategic plan. When this plan is complete it will be shared with the Board of Commissioners. Commissioner Ken Robertson asked about an allocation to maintain and operate buildings. He wanted to know if the allocation was on target with their needs. Gary Johnson, Director of Facilities, said yes. He is very appreciative of the tremendous support from the County. Commissioner Robertson asked about the number of out -of -county students attending Mitchell. Brewer said Mitchell does not have a multi -county service area. There are several out -of - county students that attend certain programs as well as Iredell County students that travel to other community colleges. They are planning to establish a site in the northern end of Iredell County. MOTION by Chairman Steve Johnson to go into Closed Session at 5:45 pursuant to G.S. 143.318.11 (a) (5) Property Acquisition. The Board returned to regular session at 6:00 p.m. May 22, 2014 Iredell-Statesville Schools — Kenny Miller, from ISS, pointed out a few things about changes in the capital budget. He said roofing needs have increased due to needs exceeding the ability to keep up. Furniture and equipment has jumped drastically because it includes HVAC equipment at WINS. Even with the REDLG loan of $1.3 million, ISS must pay the difference. The total cost is estimated at $1.6 to $1.7 million. Also, infrastructure is needed at the elementary schools because of the One -to -One Initiative, which is $350,000 for Wi-Fi upgrades. Miller said the wiring was done at the middle and high schools. However, this has now been pushed down to the elementary levels. Another line item that has changed is debt service. One loan has been paid off and there are no mobile units projected for this year. One debt service will be paid with lottery proceeds. Vehicles at $95,000 is for maintenance and IT replacements. There are no central office vehicles in this number. funds. Chairman Johnson asked how much debt service they were planning to pay with lottery Miller said it would be $129,000. Chairman Johnson asked if he was confident there will be ample lottery money. Miller said they were purposely projecting not to use all of the lottery funds this year in order to reserve money for planned architectural and engineering design work for construction projects. Commissioner Renee Griffith commented with the kick-off of the laptop project, it would seem prudent to wait another year for all of the hard wiring at elementary schools. Miller said he couldn't really address that because it is subcontracted through the IT Department. The plan is to roll out the computer course at the beginning of the year, which means a lot of computers will be shifted to the elementary schools. This will be a one-time infrastructure upgrade. Commissioner Robertson asked if the line item amount for the HVAC will be continued for a couple of years. Miller said the HVAC will be a one-time line item for the West Iredell project. The project will be bid the following week and then they will know the exact cost. Dr. David Cash said the initial request at the winter retreat was $1.7 million which represents the basic needs to help maintain the current programs, but it does not allow for any growth. However, when looking at the current expense versus the amount for this school year, it shows a $763,108 increase in the current expense side, which is close to a $1 million short fall in what was requested. The capital outlay budget shows a $3,013,445 versus the current budget of $2,398,109, which is a $615,000 increase. In recent talks, they had asked for one year only, to be 2 May 22, 2014 able to move capital outlay money over to the current expense side to help support the current programs. Commissioner Ken Robertson questioned the benefits and legalities of moving money. County Manager Ron Smith said the only way the money could be moved is in an emergency situation. The statutes are clear on the description of an emergency. The money cannot be moved from capital to current. However, there are options. In the budget request, the $350,000 in infrastructure and upgrades can be absorbed into capital. If that $350,000 is removed. Brady Johnson felt he could find $300,000 in other cuts. Commissioner Renee Griffith asked if this was connected to the laptops. Smith said it is the infrastructure at the elementary schools which is handled through capital. ISS would cut an additional $300,000 and Smith is recommending to contribute $336,000 to their current which would bring the total to $1,099,000. Commissioner Griffith said it would affect other schools and asked the total cost. Smith said the $336,000 would bring the total to $462,675.00. Commissioner Robertson asked if that was about 1/3 of potential funds for fund balance. Smith said yes. Commissioner Robertson asked why they had to do another $336,000 this year. Brady Johnson said the budget request this year was for an increase of $1.7 million which only stabilizes ISS. This will not bring back one position or program that had been cut over the past five years. Plus this request is considerably less than the request one year ago. Johnson said before the recession, ISS's fund balance was averaging about $7.5 million per year which spiked in FYI 1/12 because of federal stimulus dollars. However, the necessary funds were not available the following year and they pulled $2.5 million from the fund balance. This year they are estimating to take $2.8 million. At the beginning of the new school year beginning July 1, 2014, the fund balance will be about $5.9 million. Some tough decisions were approved by the Board of Education. Next year three assistant principals will be eliminated and other assistant principals throughout the system will be part-time employees. Also the instructional facilitators will lose one half of a month, plus another social worker position will be eliminated. Efforts to seek assistance from the County's Department of Social Services were not fruitful. It seems DSS has their own issues with staff needs. ISS will only have two social workers to serve 17 schools which is almost impossible. In the end the cuts already approved total $634,000 from what was spent last year. ISS Finance Director Melissa Wike injected that five years ago, 100 teachers were paid with local funds, but next year no teacher will be paid with local funds. Also, there are no teacher assistants paid with local money. 3 May 22, 2014 Commissioner Robertson stated the one-page summary really does not tell the whole story, but it would help to understand better with more in-depth details about why the base line has increased. Also, he would like to know exactly what could be cut if needed? Smith said, ironically, they had already talked about more details for next year. Wike said worker's comp comes directly from the schools but they have to look to the County for funding. She said when the budget proposal was put together in February they were not aware of the numbers for worker's comp. Brady Johnson said if the worker's comp is approved by the general assembly, it will cost about $600,000 which is a conservative figure. The yellow buses are owned by the state and that insurance premium will be approximately $180,000. Commissioner Robertson asked if MGSD would then be about $200,000. Chairman Johnson said if the preliminary numbers for the reval hold as predicted, then all of that money is spoken for. Brady Johnson said several major grants will expire within the next year. They have been successful is writing grants but as they expire, several staff members will go. They will lose three nurses, one SAT coordinator, three reading intervention specialists and five instructional facilitators. Chairman Johnson asked the origin of the grant money. Brady Johnson said it comes from the Department of Education. They are presently writing four new grants. He said most grants vary in length from 4-5 years. Brady Johnson said the ISS Board has made some very difficult decisions by eliminating 350 positions in the last five years. They have reduced the local supplement paid to employees. In 2010 the supplement was 8% for teachers and 6.6% for other employees, but it has been reduced by 2% points which saved $2 million in current expenses. Chairman Johnson said he isn't disputing the needs for the school system but in reviewing the County Manager's proposed budget, it shows that if the tax rate had not been increased the county's budget would be $6-$7 million less annually. He said those grants did not come from economic development, they came from borrowed money which means they are not recurring. With the present economy there is basically zero economic growth in terms of what it generates in property tax value and coupled with sales tax shows the climate now and the future for some time to come. He feels there is a minimum of 3, maybe 5 years, of the present economic climate. Dr. David Cash said it would be very difficult if they had to choose a group of students to tell that a program will no longer be provided, which is why they are presently asking what can be done together. 4 May 22, 2014 Commissioner Robertson asked which programs where more expensive. Brady Johnson said locally the 113 program is funded at $62,000 per year for all three schools. However, Iredell County students are now entering into colleges that traditionally were never even applied to before. The return on the investment has been great with the amount of scholarships received by the students. Commissioner Griffith asked for more time to review the request for ISS. Brady Johnson thanked the Board for the continued support all along the way. Mooresville Graded School District — Superintendent Dr. Mark Edwards and MGSD Board of Education member Roger Hyatt addressed the Board. Commissioner Robertson asked representatives of MGSD about their current expense and projections for the future. Dr. Edwards said he feels they have a good return on investments. The achievement numbers show they are third in the state, they are second in the state for graduates and anticipate going to number one. They have good principals in the schools and strong central office staff. Teachers are working harder than ever. They have adjusted to the larger number of students but technology has helped. Commissioner Robertson asked about staff cutbacks. Edwards said they reduced assistant principals, central office staff and cutback on their employment from 12 months to 11 months. The schedules of high school assistant principals are staggered and they have adjusted very well. Commissioner Robertson asked if these cuts are sustainable. Edwards said he would love to hire assistant principals, but it is just not in the formula. They are focusing on classrooms. They have raised money themselves to pay teachers for a summer program. The foundation has a golf tournament to raise funds. Students pay a $50 laptop fee, but if a child can't afford the $50 it is paid by the foundation. The foundation gives money for scholarships and to teachers for classroom supplies. The teachers have also volunteered to tutor. Commissioner Robertson asked about the Governor's proposal for worker's comp and school buses. MGSD Finance Director Terri Haas said she has estimated between $180,000-$200,000 for worker's comp and liability for buses is estimated about $700 per bus for 34 buses. Edwards said growth is coming, enrollment is up based on proposed and approved developments. All of these new communities are targeting young families. This year's senior class I May 22, 2014 is 350, but the graduating class from the eighth grade is over 500. He expects peak will be 2,200 students at Mooresville High School. Plus, there has been an increase in special needs students. Edwards said on the capital side, the high school is the number one concern. They are presently gathering accurate information. But the windows are all rusted, it is energy inefficient, and the cafeteria is woefully inadequate. Mr. Hyatt said the kitchen is the same as it was in the 80s when they were serving 625 children. Now they have 1,600 with the serving line exactly the same. Commissioner Robertson asked for an estimate for the auditorium, gymnasium, windows, and HVAC. Edwards said $35-$40 million and that is not addressing any other areas or schools. Commissioner Griffith asked if it wouldn't be advantageous to talk about a different plan instead of spending that amount of money on an old building. Edwards said there are usable parts and they do not have land. He said they would do borings, seismology tests, and excavation work, etc. to insure the site remains satisfactory. The intent would be to do demolition, move the auditorium, and probably turn the present auditorium site into parking. They are working on an accurate projection dollar plus details with furniture and finishes. Chairman Johnson said he and Ron previously met with school representatives. He would like to reconvene another school finance study committee. He said since he and Marvin Norman serve on the facilities committee that it would be beneficial for them to serve on the finance study committee. The schools would send a representative. Edwards would like to send two board members and Finance Director Terri Haas. Special Appropriations — Smith said there weren't many changes. The NC Forestry Service had requested a truck as part of their overall increase. However the truck they have has only 82,000 miles and he is not recommending a replacement. Soil & Water was increased to cover the increase in salaries, but they will be programed into the salary study. Lake Norman Marine Commission remains stable. The four county managers agree on what that funding will be. This concluded the budget work session for the evening. Appointment for Commissioner — Commissioner Ken Robertson said he would like to make a MOTION on the appointment for the vacancy left by David Boone. He said, "It was our original intention to appoint General Mallory as the interim commissioner to fill the spot previously held by David Boone. General Mallory received the highest number of votes for a non - incumbent candidate and was an obvious choice by virtual vote count and personal qualifications. It was also our desire to see the fourth place finisher in the republican primary to be placed on the November ballot by the Republican Party executive committee to run for the seat left vacant by 6 May 22, 2014 the passing of David Boone. Yet at the republican executive board meeting held Monday night this selection to the ballot did not happen. There have been questions raised if this Board of Commissioners genuinely wants Gene Houpe on the ballot in November despite our previous declarations that it is our desire and has been our desire. In a symbolic jester of the overt support of this position to place the fourth place primary finisher on the November ballot and with the 100% support and agreement of General Mallory. Tonight I would like to replace his name and instead appoint Gene Houpe as a County Commissioner of Iredell County with the sincere desire that his name will also appear on the November ballot." Vice Chairman Marvin Norman said, "I know it is not needed, but I second it." Chairman Johnson said it is his understanding to vote on one nominee at a time and asked for any other comments on the nomination. Chairman Johnson said, "The vote 1 will cast tonight is not meant to be a criticism of anyone. I do not think that this board should use the appointment of an interim person to influence an internal decision of the executive committee. That is totally their purview. I have expressed to them on several occasions that it would be not my intent to meddle in the event unless 1 was asked to give input. On more than one occasion I have been asked to give input and did so. That decision is totally theirs. I see these two decisions as totally independent of one another. In the interim appointment the recommendation comes from the executive committee and is the decision of this board. You can argue to an extent that as far as the ballot nomination the roles are reversed. We may recommend personally and we may choose not to do so and we may be consulted, but to a large measure those roles are reversed. I think everyone knows that my original intent, after leaving David Boone's bedside that night, convinced that he would not live much longer and absolutely certain he would not return to this board. Judging on the three previous appointments, which human nature being what it is, to some degree became messy. It was my sole intent, all along, not to be against anyone but be for a smooth transitional process. On the three previous times that we have done this on the Board, each time we have selected a former county commissioner. Someone with local budgetary experience and we've removed personalities out of it. I expressed that upon various members of the executive committee, that didn't happen. But again all that is, is a recommendation. I cannot tell them their business. But I made a commitment to the party chairman and various members of the executive committee that I would vote for whoever they recommended once I saw that my recommendation would not be followed. Tonight I will keep that commitment and I will not vote for anyone other than James Mallory, because I said that is what I will do. Now, let me say this, Mr. Houpe is a friend of mine and it is not my intent to say anything critical. Sixty two hundred people voted for him and that is a strong showing in a year. As compared to a time when I first ran, I think I received 1,685 votes in the republican primary and I came in a very close second when I did. So he is to be commended for running a good campaign, an honest campaign and forthright he is to be commended for that, but I have no problem if the executive committee wishes to put him on the ballot, but I will not use this vote to influence their decision. They've been pushed about enough." Commissioner Renee Griffith said, "In the same token, do you suggest this board should not influence the executive board of the Republican Party? It should be in the same consideration that the executive board does not influence this board's decision on what's done." 7 May 22, 2014 Chairman Johnson said, "The statute calls for them making a recommendation. The statute does not call for us to make a recommendation. That is by state law. The statute says the executive committee of the respective parties, republican, democratic and libertarian. Those are the organized parties recognized by law in North Carolina. And it says they shall make a recommendation." Commissioner Renee Griffith said, "When the discussion was regarding the seat that I sat in, I felt very strongly, based upon principal, that the person who should sit in this seat whether it is state statute or not, out of deference to the process of the electoral, of the voters, that it should go to the person that finished next regardless of that person's name. This would allow for transparency and it would set a process in place by which feelings aren't hurt, relationships aren't damaged and both boards can act with a sense of integrity and not bypass what the voters have said. My position has not changed in those two years and it hasn't changed tonight. I think, and it's a personal feeling because it is not set in state statute, sometimes when negotiations are done and board members are present it is extremely disrespectful to the voters of this county." Chairman Johnson said, "Nobody ran for an interim seat. Everybody who filed in the filing period filed for a position on the ballot. That's why the statute has great latitude as far as who the executive committee can appoint and who this board can appoint. I respect everybody's decision here tonight and I have stated mine. Are there any other comments?" Chairman Johnson said the nomination before the board is for Mr. Gene Houpe. VOTING: Ayes — 3; Nays — 1, Chairman Johnson. Gene Houpe expressed his appreciation to the Board and to the citizens. He asked that the Board reunite, heal all wounds and move forward. He said it will be an honor to work with all county staff. He said he would represent the board and citizens with honor and integrity. OTION by Chairman Johnson to adjourned. VOTING: Ayes — 4; Nays — 0 Approval: Clerk to the Board