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2020-09-21 Regular Meeting NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 657 ASSEMBLY The New Hanover County Board of Commissioners met in Regular Session on Monday, September 21, 2020, at 9:00 a.m. in the Assembly Room of the New Hanover County Courthouse, 24 North Third Street, Wilmington, North Carolina. Members present: Chair Julia Olson-Boseman; Vice-Chair Patricia Kusek; Commissioner Woody White; and Commissioner Rob Zapple. Commissioner Jonathan Barfield, Jr. arrived at 9:10 a.m. Staff present: County Manager Chris Coudriet; County Attorney Wanda M. Copley; and Clerk to the Board Kymberleigh G. Crowell. INVOCATION AND PLEDGE OF ALLEGIANCE Lay Preacher Elise Rocks, Church of the Good Shepherd, provided the invocation and Commissioner White led the audience in the Pledge of Allegiance to the Flag. APPROVAL OF CONSENT AGENDA Chair Olson-Boseman requested a motion to approve the Consent Agenda as presented. Commissioner Zapple requested that Consent Item #5 Adoption of Budget Amendments be removed from the Consent Agenda for further discussion and consideration. Hearing no other comments, Chair Olson-Boseman requested a motion to approve the remaining items on the Consent Agenda. Motion: Commissioner Zapple MOVED, SECONDED by Vice-Chair Kusek, to approve the remaining items on the Consent Agenda as presented. Upon vote, the MOTION PASSED 4 TO 0. CONSENT AGENDA Approval of Minutes – Governing Body The Commissioners approved the minutes of the Regular Meeting of September 8, 2020. Adoption of Constitution Week Proclamation – Governing Body The Commissioners adopted a proclamation recognizing September 17-23, 2020 as Constitution Week in New Hanover County. A copy of the proclamation is hereby incorporated as part of the minutes and is contained in Exhibit Book XLII, Page 18.1. Adoption of a Resolution Recognizing the 100th Anniversary of the Ratification of the 19th Amendment and the Founding of the League of Women Voters and the 55th Anniversary of the Voting Rights Act – County Manager The Commissioners adopted a resolution recognizing the 100th anniversary of the ratification of the 19th amendment and the Founding of the League of Women Voters, and the 55th anniversary of the Voting Rights Act. A copy of the resolution is hereby incorporated as part of the minutes and is contained in Exhibit Book XLII, Page 18.2. Approval of July 2020 Tax Collection Report – Tax Department The Commissioners accepted the Tax Collection Reports of New Hanover County, New Hanover County Debt Service, and New Hanover County Fire District as of July. Copies of the tax collection reports are hereby incorporated as part of the minutes and are contained in Exhibit Book XLII, Page 18.3. Consideration and Adoption of Budget Amendments – Budget In response to Commissioner Zapple’s questions regarding various budget amendments, Chief Financial Officer Lisa Wurtzbacher stated that budget amendment 21-015 is for new equipment to provide a hot spot wireless signal in the mobile command center bus and it will work with the existing system. Budget amendment 21-017 is to provide a school nurse at the Porters Neck Elementary School to continue the Board’s directive to have a nurse present in all New Hanover County schools. Budget amendment 21-018 is moving the Recovery and Resiliency Office for contract of services, supplies, salary, etc. from the General Government function to Public Safety where the department is going to be housed. Hearing no other comments, Chair Olson-Boseman requested a motion to approve the Consent Item #5 as presented on the Consent Agenda. Motion: Commissioner Zapple MOVED, SECONDED by Chair Olson-Boseman, to adopt the budget amendments for Consent Item #5 as presented. Upon vote, the MOTION PASSED 4 TO 0. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 658 Copies of the budget amendments are hereby incorporated as part of the minutes and are contained in Exhibit Book XLII, Page 18.4. REGULAR ITEMS OF BUSINESS PRESENTATION AND PUBLIC HEARING ON THE 2021 SCHEDULE OF VALUES Chair Olson-Boseman announced that the Board was presented with the proposed 2021 Schedule of Values at the September 8, 2020 meeting, and notice of the public hearing was published in accordance with general statute. She opened the public hearing to hear comments on the proposed values. Tax Administrator Allison Snell presented information about the 2021 reappraisal as follows:  2021 Reappraisal:  About Reappraisal:  What is reappraisal?  The process of appraising real estate parcels countywide at fair market value and, if applicable, present-use value as of a specific date  The upcoming reappraisal will value approximately 108,000 parcels and will be effective as of January 1, 2021  Why perform a reappraisal?  Reappraisals are performed to re-establish a fair and equitable tax burden between properties  North Carolina law requires counties to perform a countywide reappraisal at least once every 8 years. Appraised tax values in New Hanover County currently reflect fair market value as of January 1, 2017  Reappraisal Property Types:  What property is included: All residential and commercial land throughout New Hanover County; this includes exempt property and permanent structures on the land  What property is not included: Personal property such as business equipment (computers, desks, chairs, machinery, equipment); motor vehicles, boats, airplanes; and public utility property (electric/nuclear power generation, gas companies, bus lines, railroads). These property types are appraised annually.  2021 Reappraisal:  The local commercial and residential markets have been robust since 2017  Components of the tax base have increased in value at different rates by property type and location  The broad ranges and rates in the proposed Schedule of Values serve as guideposts to set new assessed values  There are dozens of property and location specific adjustments that may factor in to each property assessment  Preliminary results may be ready to share beginning in January  Schedule of Values (SOV):  What is the SOV:  Provides the NC General Statutes that must be followed when appraising properties and administering a property tax program in North Carolina  Discusses market value and present-use value  Discusses the three approaches to value and the concept of highest and best use  Provides summaries and broad ranges of the parameters and schedules in the CAMA (Computer Assisted Mass-Appraisal) system that are used in appraising land, residential improvements, and commercial improvements for ad valorem tax purposes in New Hanover County  Project dates 2020: th  September 8: submission of the SOV to the Board of Commissioners th  September 10: advertise notice of upcoming public hearing st  September 21: hold a public hearing on the SOV th  October 5: adoption of the SOV by the Board of Commissioners ththndth  October 8, 15, 22, 29: advertise adoption of the SOV th  November 5: last day to appeal the SOV to the State Property Tax Commission  Notice of appraised value:  The notice of appraised value mailed to property owners in late February will provide:  A description of the reappraisal process  Results of newly assigned value; these values will not reflect any exemptions that may exist  An explanation of the appeal process and instructions on initiating an appeal.  Contact information for the New Hanover County Tax Department  Customer Service:  General Tax Office Help: fully staffed and trained call center (910) 798-7300  General Help Email: taxadmin@nhcgov.com NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 659 In response to Board questions, Ms. Snell stated that she is not ready to discuss the percent of increase in terms of value as there is still work to do through the end of the year to get to that point. The market has been quite robust since the 2017 revaluation. The Board of Equalization and Review is appointed each year and is a tough board to fill. County Clerk Crowell stated that the latest the advertisement will be posted is February 2021 in an effort to have the appointments completed in April 2021. Hearing no further discussion, Chair Olson-Boseman thanked Ms. Snell for the presentation. WILMINGTON URBAN AREA METROPOLITAN PLANNING ORGANIZATION (WMPO) CAPE FEAR MOVING FORWARD 2045 METROPOLITAN TRANSPORTATION PLAN (MTP) PRESENTATION WMPO Deputy Director Abby Lorenzo presented the following information on the WMPO Cape Fear Moving Forward 2045 MTP as follows:  Cape Fear Moving Forward 2045 Metropolitan Transportation Plan:  Presentation overview:  About the WMPO and its requirements; the plan development process; the final plan; and how to support the plan  About the WMPO:  Formed in 1978; represents approximately 280,000 in population; encompasses 494 square miles; and has a 13-member Board includes representative from each member jurisdiction (two from Wilmington), the Cape Fear Public Transportation Authority, and NCDOT Board of Transportation  Responsibilities of the WMPO:  Federally required to provide regional transportation planning utilizing a continuing, cooperative, and comprehensive (3Cs) process which serves as the basis of the expenditure of federal transportation funding  Update and maintain the metropolitan transportation plan every five years  Prepare an annual work plan (UPWP)  Assist in the prioritization of transportation projects for the development of the STIP/MPO TIP  Coordinate the activities of the WMPO Board and TCC  Metropolitan Transportation Plans (MTP) are federally required to:  Provide a regional multi-modal transportation needs analysis; consider regional demographics and land use; public involvement; 20-year minimum planning horizon; fiscally constrained; and serves as the basis for MPO Transportation Improvement Projects (TIP)/State Transportation Improvement Projects (STIP)  Plan development process:  New requirements and considerations:  FAST Act Requirements; additional planning factors; inclusion of inter-city transit providers and tourism; performance based approach; innovative technologies; resiliency; and environmental justice  Public participation:  2,287 public survey responses; 4,554 votes on map comments; and 563 unique public comments on the Cape Fear Moving Forward 2045 interactive map  Modal elements development: NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 660  Financial forecast development:  Fiscally constraining the plan:  Alternative funding sources:  A funding gap of $7 billion was identified based on identified regional project needs and forecasted funding  Alternative funding sources utilized in North Carolina and other parts of the US were researched, including taxes, fees, grants, and bonds  Alternative funding sources explored by the Board: quarter cent sales tax; quarter cent sales tax for transit; motor vehicle license tax; motor vehicle license tax for transit; vehicle registration fee; vehicle rental tax; bicycle registration fee; transportation bonds; tolling  The Board supported the tolling of the Cape Fear Crossing, allowing for the forecasted toll revenues to be utilized for fiscally constraining a portion of the project in the plan  Transportation Demand Management (TDM) strategies:  Transportation System Management and Operations (TSMO) strategies: access management; additional turn lanes; bus pullouts; emergency vehicle preemption and transit signal priority; intersection modifications and geometric design improvements; improved signage and lighting; pavement markings; motorist assistance program; streetscape improvements; social media and smart apps; traveler information systems and dynamic message signs; traffic signal timing optimization; vehicle detectors repair/replacement  Public review of the draft plan:  Public outreach phase II: February 26, 2020 – April 15, 2020  In person open houses: March 4, 2020 – March 10, 2020  Virtual open houses: July 6, 7, and 8, 2020  113 comments addressed by staff  Final plan outcomes:  Number of fiscally constrained projects by mode: 82 bicycle and pedestrians; 10 ferry and water transportation; 79 roadways; 91 public transportations; 7 freight and freight rail; 28 aviation NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 661  New Hanover County Projects – All bicycle and pedestrian roadway:  Unincorporated New Hanover County Projects – bicycle and pedestrian roadway:  Your role in supporting the plan:  Consider during development review, CIP planning, and local plan development  Promote WMPO initiatives  Participate in all efforts to develop the 2050 plan In response to Board questions, Ms. Lorenzo stated that the North Carolina Department of Transportation (NCDOT) is working through its cash flow shortage and revenue problems. Most projects in this region are on hold and NCDOT is drafting new schedules to have plans in place relative to the fiscal issues. Things are changing daily so it is unknown what the schedules will look like or will be finalized. NCDOT’s focus is keeping projects, such as the Military Cutoff project, moving forward while working out where revenues are going to come from to continue supporting projects in this region, especially over the next five years. Revisions were recently released for its improvement program, which the WMPO board will consider at its next meeting, but those could potentially change as well. The Military Cutoff project, as she understands it, is still fully funded and moving forward. The Hampstead bypass project, based on the recent program revisions, is pushed back significantly for two years. It is a priority project for this region and all parties involved are working together with NCDOT - Raleigh to make sure the priority is being pushed to get funding. The Snow’s Cut bridge project included in the long range plan is for replacement in the later years of the plan. Depending on what the prioritization process and the development of future steps will look like, will determined whether or not it is submitted right away for prioritization and potential inclusion into a work plan. Again, it was identified as a necessary project during the life of this plan. The flyover projects for Eastwood and Military Cutoff, and the Martin Luther King, Jr. Parkway and North College Road are also on hold. In response to additional Board questions, Ms. Lorenzo stated the financial forecast for this plan was developed in 2018-2019 by looking at the revenue trends of the past ten years, and things have significantly changed in the last nine months. This plan moving forward will continue to have the projects fiscally constrained, based on the financial forecast that the WMPO developed. What is going on now will be considered during the development NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 662 of the next MTP. It will likely have significant impacts on what that financial forecast is going to look like. However, it is also important to have a plan in place because things change and can change fast. It may be optimistic and hopeful to think that during the next five years, before there is a new plan, that new revenue sources could be in place and many of the projects could be moving forward again. Again, it is important to have the plan in place to show what the priorities are and to continue pushing forward and looking for ways to fund them. Commissioner Barfield stated that many of the projects indicate a state or local match and expressed concern that the state will look for alternate funding sources in an effort to put the responsibility on local governments and communities to fund projects that are ultimately the state’s responsibility. This state is one of seven in the country where the counties do not do roads. There is a definite concern about that occurring while at the same time it is recognized that the vehicle gas tax is not enough to maintain things across the state moving forward. Efforts need to be made to look at what other states and local governments are doing to fund projects. Hearing no further discussion, Chair Olson-Boseman thanked Ms. Lorenzo for the presentation. SCHOOL FACILITIES UPDATE FROM NEW HANOVER COUNTY SCHOOLS New Hanover County Schools Board of Education member Nelson Beaulieu introduced Dr. Charles Foust and stated that the school system has been through a lot over the past year. Given where the district was, the most important thing for him was to find a person to serve as school superintendent that came with ethics, integrity, and character. He believes those qualities are found in Dr. Foust and that he is the right leader to bring the New Hanover County school system into the next decade and to lead it through the current pandemic. Dr. Charles Foust, New Hanover County Schools Superintendent, stated it is a pleasure to be back in North Carolina and serving as the leader of the school system. He is here to assist with restoring trust back into the schools, neighborhoods, and communities and making sure that all communities are provided the same education and providing rigor within those neighborhoods and in those schools. He will be glad to answer any questions or take any comments the Board has. The Commissioners welcomed Dr. Foust to the community and stated they look forward to working with him and the school board, and asked that he speak on reopening the school facilities, the capacity of the facilities to allow for social distancing, and his top three priorities that he would like to quickly accomplish. Dr. Foust stated that he is an educator, not a scientist or medical doctor, and the school system relies heavily on the health directors to ensure that what it has prescribed is safety first. There will be a plan for all scenarios and there is already one for Plan C. Under the leadership of the medical directors, the school system would never put anyone in any situation that would cause or provide an unsafe environment. As to there being enough capacity in the school facilities to allow for social distancing for in-school teaching for pre-k through third grade, Dr. Foust stated that if the school system moves towards Plan A, he does not know that there would be the ability to provide social distancing in the schools for everyone in there. However, the school system does have enough PPE and other safety measures on hand to keep teachers, administrators, and children safe. The PPE supplies are at the schools and have not been given out by school leaders to the teachers as the teachers are the only ones in their respective classrooms, so they do not need those resources at this point. Moving forward, they should be given out this week. As to if the school system will be moving forward with Plan A or a partial Plan A, Dr. Foust stated Governor Cooper announced the decision to allow schools to move to Plan A last Thursday. The Board of Education will be meeting to discuss and examine the options based on this announcement, which will include the health leaders, to determine the plan that will be executed. As to the top three priorities that he would like to quickly accomplish, Dr. Foust responded that first, providing an environment for students with a main priority to instill trust back into the community and he knows that will take a bit of time. He wants to make sure that everyone knows and understands that there are measures in place such as working to train board members in Title VI and Title IX. Another training is dealing with bullying and harassment, making sure that all board members, senior staff, teachers, and students are trained in that. Those are quick fixes. The next is addressing the achievement gap. The district has been ranked in the top 20 in the state out of 115 school districts. His goal is in the next three to five years to be in the top ten and then the top five. Measures are being put in place to close the achievement gaps. He understands the Board had questions regarding the achievement gap with being out of school from March until now, and he would say that is a precursor as there was a large achievement gap prior to that. There are things he knows will assist all students in closing the achievement gap. What has to be done is to look at subgroups, which is one of the things he will be charging the principals with, and the third thing is increasing the proficiency rating by ten percentage points to achieve the goal of reducing the achievement gap. Finally, putting together a literacy framework as reading is important. If students cannot read on grade level, they will never be able to sit where the Commissioners are sitting, where he is sitting, etc. The goal is to make sure students are reading on grade level before they get to third grade. Measures and instruments to do this will be looked at as well as professional development to train the teachers on how to teach reading to make sure that students are on grade level by the third grade. Once the students are there, it is easier to keep them on track. The problem is when they are not on grade level and materials are being introduced as required by the state to teach at that grade level. The AP and EOG exams are written at the grade level for the specific students. If students cannot perform at grade level, then the district is not doing its job as educators. Hearing no further discussion, Chair Olson-Boseman thanked the school district team for speaking with the Board. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 663 CONSIDERATION AND APPROVAL OF 2020-21 BOARD OF EDUCATION BUDGET TRANSFER AND BUDGET AMENDMENT #1 New Hanover County Schools Chief Financial Officer Mary Hazel Small stated that the request is for approval of the following budget transfers:  Transfers $200,000 in savings from the following bond projects: Roland Grise Middle School Renovations ($100,000); Myrtle Grove Middle School Renovations ($66,013.01); New Hanover High School (NHHS) Roof ($27,549.24); and Roland Grise Middle School Roof ($6,437.75). These projects are complete and came in under budget. Transfers the $200,000 in savings to the bond project for NHHS Brogden Hall Gym Floor Replacement.  Transfers $142,852 from a Water Filtration Systems county capital appropriation project because it was decided to lease the equipment. This amount is transferred to the following county capital appropriation projects: Pine Valley Mobile Door Replacements ($95,852); Upgrade Lock/Doors at Myrtle Grove ($40,000); and Egress Lighting Wall Packs ($7,000). She further stated that Budget Amendment #1 is for the carryover of capital projects from FY2019-20. Regarding the Pine Valley project as it is on the list to be replaced, Ms. Small and Assistant Superintendent of Operations Eddie Anderson both agreed that it is an important issue to replace the doors as it is a security issue. The doors on the mobile units, currently, when students are transitioning between the main building and their classrooms, the doors have to be physically locked so they are locked or unlocked the entire time. The work would put the mobile units on the new card access system, so teachers could access the mobile units with cards instead of keys and provide more security. If there was funding to replace the school, the mobile units would be reused. It is an investment and is consistent with the long-term plans for rekeying all of the school facilities. As to the replacement of the gym floor at New Hanover High School (NHHS), Mr. Anderson stated it was a full replacement of the floor. Over the past few years, repairs have been made and the recent repair costs are exceeding the past value of the floor. It is felt it is appropriate at this time to do a complete replacement. It is also being recommended that it be added to the NHHS bond project to be funded with savings from other projects in the bond. It is used for things more than athletic events as is done with most of the high schools. Hearing no further discussion, Chair Olson-Boseman asked for direction from the Board. Motion: Chair Olson-Boseman MOVED, SECONDED by Commissioner White to approve the 2020-21 Board of Education budget transfer and budget amendment #1 as presented. Upon vote, the Motion CARRIED UNANIMOUSLY. UPDATE ON THE DELAY OF THE YMCA NATATORIUM PROJECT AND/OR ANY NECESSARY POTENTIAL CHANGES YMCA of Southeastern North Carolina President and Chief Executive Officer Dick Jones expressed appreciation for the opportunity to update the Board on the YMCA vision for the community. The natatorium project was originally envisioned as a community partnership with the County, the City of Wilmington (City), New Hanover County Regional Medical Center (NHRMC), and New Hanover County Schools along with the YMCA. The project would have been funded by all four of those partners in July, envisioned to reside at 2710 Market Street, right next to the YMCA. The YMCA agreement was signed with the County in February 2018 and two initial funding payments were made in March 2018 for fiscal year 2017-2018 and the second in July of fiscal year 2018-2019. The YMCA continued to work with other partners during that time frame and had ongoing conversations with pool boards. The City agreement was about five months later and was not actually finalized until fiscal year 2019-2020. During the interim from when the County signed to today, a lot has occurred in the community. In 2018, the school system identified internal issues, which obviously diverted attention from a project like this and resulted in a new school superintendent, who he expects to meet with in the near future. It is also known that NHRMC has changed its vision and direction. In May 2019, the current project schedule was reviewed and it was realized that the original schedule was not going to be met that is in the County agreement. That is when he and his team contacted County staff and updated the schedule. At that point, he expected to have the funding commitment from all of the partners in place by October 2019. Had that occurred, construction would have begun the first quarter of this calendar year with a potential opening of December 2020 or January 2021. Once COVID began, additional conversations were held with the City Council and it is considering partnering with the city schools and looking at their funding commitment to this project to help improve the resources in the Northside community. That is a collaborative with the hospital and North Carolina Swim and is focused on health equity in the Northside. Mr. Jones further stated as of today, the County is the only partner that has funded its initial interests at $300,000. Those funds are in the account waiting for this initiative. Given the changes that are expected with NHRMC, this concept might be one that the community foundation would consider from a health equity standpoint and a community health standpoint. The City is interested in aquatics and is committed to helping children learn how to swim. The YMCA has a commitment to that as well. He hopes the County continues to have that type of commitment for all residents. One of the initiatives that has been worked on during the past few months is a partnership with the YWCA and the school system to help kids across the community learn to swim. That was one of the initial key elements of this project, to provide additional bodies of water so kids could learn how to swim. When he spoke with County staff back in May, he shared with them the City’s thoughts on what it was thinking about doing and it was recommended he speak with the Board. Due to COVID going on, he did not have a chance to call NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 664 the Board and apologized for not providing an update on the project. The YMCA stands committed to the initiative, he hopes the Board does and knows others in the community are looking forward to this, but right now, the timing is not right to move it forward. In response to Board questions, Mr. Jones stated it is up the County when the $300,000 is returned. However, his desire is that the Board not back off its commitment to this resource and at the appropriate time, County funding would be encouraged and hopefully would be a part of the project. Commissioner White stated he would like to suggest that the money be returned, but only while there is also an initiative started on a brand new effort in this community. The citizens were not promised, but led to believe 10 or 12 years ago, there was going to be a natatorium with the parks and recreation bond funds which were spent on good things such as tennis courts, basketball courts, baseball fields, soccer fields, etc. and there was not enough to build a natatorium. The Board agreed with Mr. Jones and his board members to partner with the schools, the City, and NHRMC to try to build a natatorium because it meets so many needs in the community, it meets the needs of a regional swim aquatic center, and there are thousands of people coming here all the time to play baseball and soccer, we live in a coastal community, we need an aquatics center, it is that simple. It also meets a hugely underserved population of public school swimmers. This is an opportunity to improve swimming for young people. For general knowledge, if a student swims for Hoggard or New Hanover, they may have to be at the pool as early as 5:30 a.m. or 6:00 a.m. or as late as 9:45 p.m. or 10:15 p.m., and then drive home, go to bed, and be right back at school the next morning. There has been a consistent problem of inventory, not to mention the other uses by the senior center and all of the other folks that exercise in pools. He sees the incredible opportunities there are in this community to meet many different needs. He would suggest that in light of what will hopefully be a community foundation, this is one of the types of transformational decisions that might happen in a long list of many others that can meet the needs of a lot of these different groups. He would also suggest possibly a work group of various parties to address what is our swimming strategy in the community. Bubbles on the pools do double the inventory as that makes them usable in the winter months. That is a relatively inexpensive way to increase inventory without building a huge center in the municipality. It is a problem that is solvable and he thinks the County has indicated its willingness to be a partner and the timing is right to set up the strategy. While it is regretful it did not work out, contractually he thinks the agreement for this matter should be terminated and the funds be returned in the short term. He is glad the school district team is present to hear this part of the meeting because it is a real need for public school swimmers. He also wants to be very clear that in no way does he fault the YMCA for this matter not working out. He thinks there should be a new agreement that is bigger and better that will serve a much broader need. As to if the Board needed to take a vote to terminate the agreement and direct that the funds be returned to the County, County Manager Coudriet stated that would need to be done so that is a clear directive of the Board. Motion: Commissioner White MOVED, SECONDED by Commissioner Barfield to terminate New Hanover County Contract 18-0289 with the YMCA of Southeastern NC, Inc. and direct that the funds previously disbursed to YMCA in connection with the agreement be returned to the County General Fund. Commissioner Zapple stated this is a commitment that has been made by the elected officials to ensure that every citizen has access to facilities to learn to swim by the age of 7 and it should be a goal of the community. The current goal is to pull together the original partners plus others in order to get a firm commitment from them so it is not only the County and the YMCA trying to solve the issue. This is one of the rare instances where an issue is solvable by money. He looks forward to future discussions on this matter. Hearing no further discussion, Chair Olson-Boseman asked for the board to vote on the motion on the floor. Upon vote, the MOTION CARRIED UNANIMOUSLY. INVESTMENT RESTRICTIONS FOR COMMUNITY FOUNDATION PRESENTATION Chief Financial Officer Lisa Wurtzbacher stated work has been done to structure a community foundation that would receive, invest, and grant a portion of the proceeds that would be received by NHRMC if the Board approves the asset purchase agreement (APA). One objective that has been worked on is structuring the foundation to make sure it has the most flexibility to access strong investment returns in order for the money to grow and last over time and benefit this community for many years. The County is bounded by North Carolina General Statute (NCGS) 159-30, Investment of Idle Funds, which restricts the County’s investments to essentially 12 different options that are typically lower risk and have a low yield. Examples are obligations of specific U.S. governmental agencies, obligations of the State of North Carolina, bonds of any of the North Carolina local governments, and public authorities. This is part of the reason work has been done to make sure that how the foundation is structured, it would not be subject to NCGS 159-30. She then reviewed the following average rate of return comparison model that shows the different annual returns that could be experienced. The dark blue bar assumes a one percent average annual return, the light blue is two percent, the red is three percent, the green is four percent, and the orange is five percent: NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 665 She further explained the various buckets shown on the slide are cumulative gains over 10, 30, 40, and 50 years. The model assumes that all of the interest being earned, all of the gains received are spent within that year, so it is not compounding interest. It is a relatively simple model, but provides an idea of the difference in dollar amounts in the different rates of returns. In looking at the far right bucket, one can see the difference in the 50-year cumulative gains between the one percent and five percent investment return is $2.5 billion over 50 years. There is really no way of knowing what future markets are going to return inside or outside of NCGS 159-30 and this model merely shows the differences. As a point of reference and to provide some perspective, this time last year, the County's investment portfolio had an average yield of about 2.18% and nothing yielded over 2.8% within the portfolio. Ms. Wurtzbacher concluded the overview stating that she is not an expert on foundation investments, but feels it is reasonable that it could be assumed that a foundation portfolio could generate five percent or more. In response to Board questions, Ms. Wurtzbacher confirmed that the assumption she made was that there would not be compounding of interest and that interest earned is spent. When and if the foundation is created, its investment strategies will be self-determined. She further confirmed that some of the principle or throw-off could be invested and there could be interest earned compounded over time so it would grow. A brief discussion was held about the point of this presentation being to show the difference between what would be able to be given and spent in this community from the foundation if it was under NCGS 159-30 and if it was not. As to if it was correct that in comparing, for example, a two percent return to a four percent return the difference is $25 million every year that would not be generated and spent in the County, Ms. Wurtzbacher confirmed that was correct. As to what should the foundation be structured to do in order to not come under the jurisdictions of the limitations of NCGS 159-30, Ms. Wurtzbacher stated that the advice from the UNC School of Government was that the foundation needed to be structured where the County does not have control (voting authority, budgetary controls, etc.). Based on the advice given, that is how the foundation is structured and County Manager Coudriet will discuss that in the next agenda item. Also, a memo was put together for the Local Government Commission (LGC) that essentially lays out all of the details of this structure so they can opine on that it agrees that this is not under NCGS 159-30 and the County can have assurances that this structure will keep the foundation out of NCGS 159-30. Ms. Wurtzbacher further confirmed that also has to do with this Board not appointing a majority of the members to the community foundation board. If the Board appointed the majority of voting members, it essentially would have control. In response to additional Board questions, Ms. Wurtzbacher stated there was no factoring in of recessions during the 50-year period and the model is assuming the particular returns year-over-year are just the same one or two percent and that again, there is no way to know when a recession or boom may happen. As to when the cycles go into recession, she stated it may be every 10 years. Commissioner Zapple stated in regard to Ms. Wurtzbacher’s comments about NCGS 159-30, he does not see how the foundation would not fall under it. First, it has to do with the component unit qualification of the hospital that the County currently has that any appointment that is made by the County Commissioners, or by the hospital, because the hospital falls under the County’s direct control, will under examination, be considered all appointments are made by this Board which would then put the foundation under the statute. Secondly, under 159-30(8) it states that the LGC has the ability to approve any plan, any investment plan, that a county would bring forward. As to if a letter has been sent to the LGC, Ms. Wurtzbacher reconfirmed that a memo was sent to the LGC to obtain its opinion. The ask in the memo is if the definition of whether or not the foundation would fall under NCGS 159-30. The memo lays out the current structure and also poses some various scenarios as well for consideration, but it does not ask the LGC for a specific different investment plan that it would have to approve. The response from the LGC was expected last week and in contacting them last week, Ms. Wurtzbacher was told this was a very complex issue and that they hope to have a response to the County by the end of this week. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 666 Hearing no further discussion, Chair Olson-Boseman thanked Ms. Wurtzbacher for the presentation. NEW HANOVER COMMUNITY FOUNDATION PLANNING UPDATE County Manager Coudriet introduced Don Munford, outside counsel for the County with Smith Anderson, stating he was here to answer any technical questions the Board may have about the foundation. Mr. Munford will also review the process to create the foundation, if the Board decides to move forward. County Manager Coudriet presented the following information on the proposed foundation noting that staff does not consider the draft foundation bylaws to be final in any manner and the Board is not being asked to adopt them today. Today’s information is to provide where staff is in the process, receive clarifying Board input so that if the Board does move forward in October, Mr. Munford can proceed with filing the final paperwork, including the bylaws that meet the Board’s expectation. There are several policy matters that have been raised with staff and there any number of administrative pieces that really have no bearing on the substance or the policy, but this is really about clarity of language to make sure that the word that is chosen is conveying exactly as it should, and it would be helpful to have Board direction. He then presented the following information:  Proposed New Hanover County Foundation:  Foundation Structure:  501(c)(3) corporation  11-person board at the outset and in perpetuity:  Six (6) members appointed by the local successor hospital board  Five (5) members appointed by the New Hanover County Commissioners  Residents of New Hanover County  Intended to support the public health needs and certain social welfare projects for the County  Priorities cannot be changed without supermajority request of the foundation board and supermajority consent of the County Commissioners  Member Characteristics and Competencies:  Reflective of the community demographics to include consideration of race, gender, and ethnicity  Demonstrated strategic leadership and complex decision-making experiences  Demonstrated capacity to work collaboratively with groups made of diverse persons  Demonstrated professionalism that is in keeping with the high standards of public service  Commitment to the values of the foundation  Varying life experiences reflective of education attainment, economic prosperity, and social mobility  Membership:  Each member may serve two (2) consecutive three (3) year terms  Directors serve for term unless the majority of the foundation requests the appointing authority to replace a member – the appointment authority may consider a replacement  May be election of a chairman of the board  Members select the chief executive officer of the corporation  Fund Management and Distribution:  Financial advisor appointed or removed by a supermajority of the foundation  Smart and secure investing to maximize interest earnings  Unitrust formula  Annual allocations shall not be more than four percent of the net fair market value of the endowments’ assets  Administration of the Foundation:  Biannual presentation for the benefit of community’s awareness at the call of the County Commissioners  Supermajority vote to amend the foundation bylaws with the exception that the appointment of directors section may not be amended Mr. Munford stated that he has had the pleasure of working with the County staff in putting together the documents and the organization for what will be the New Hanover County Community Foundation and would be glad to answer any questions from the Board. He would like to review the steps that will take place in establishing the foundation and possibly address some of the practical issues that the Board has to consider in the final steps of the process. Commissioner White asked in regard to Section 6: Removal of the proposed bylaws if it is stating that at any time a majority of the existing foundation can remove a fellow member of the foundation. Mr. Munford responded that no, a majority of the board can request that the appointing entity, the County or the local successor hospital board, replace one of their appointees. Commissioner White asked if it was correct the reason for that is if someone is not doing their job or if there is a problem that the appointing entity would want to know about it. Mr. Munford confirmed that was correct and that he also thinks it leaves a lot of room for silence and dissenting voices into a very robust conversation that takes place about priorities, spending, etc. Commissioner White stated that he is not sure that the County has an equal provision in any of the other County-run organizations, so it is something to think about and does not have to be covered today. Mr. Munford stated it is unusual, perhaps, to have just a majority. Commissioner White stated he would like there to be more conversation on that at the appropriate time. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 667 Commissioner White stated his second question is on the issue, intellectually, that has been raised about the six appointees from the new hospital board. The optics are, a new hospital board is created and it's called something along the lines of the Novant Hospital Board for New Hanover Regional. He asked Mr. Munford to walk the Board through how those six people would have to reside in New Hanover County and the mechanics of how they would be chosen a) not only initially, but also through their three-year increment terms and then, b) if there is a change in ownership from Novant ten or more years from now. Mr. Munford stated the six members of the local successor hospital board will be named in the final documents before the closing takes place. He understands they will be picked in conjunction between the current hospital board and Novant looking for the best talent they can have to be on there. Going forward, if a board member of the foundation who is a local hospital board appointee when either the term ends or they resign or die or whatever, the local hospital board as it then exists, would appoint the successor to that individual. For example, if a board member who is a local hospital board appointee, were to become ill and resign, immediately as soon as practicable the local hospital board would appoint his or her successor. Commissioner White asked if the local hospital board is the new hospital board. Mr. Munford confirmed that was correct. He then asked if it was comprised of 15 people, and stated it is an important point for the public to know, and asked County Manager Coudriet to provide information on that point. County Manager Coudriet stated as he understands from reading the executive summary of the asset purchase agreement (APA), it will now be a 17- member board, 10 will be County residents, 3 will be physicians, 1 member each from Pender and Brunswick, and then 2 additional members. It will be a 17-member board as opposed to 15 and it is that membership with the initial appointees and all subsequent appointees, that would be making the local foundation board’s six appointments. Of the 17, a majority of them will reside in New Hanover County. Commissioner Zapple stated one of his questions is how the local hospital board gets populated and it will come from selections of the County’s current hospital board and Novant. To him it goes back to his earlier comments that as long as any appointments are being made by our local hospital board, that is considered coming from the County. Mr. Munford responded that he disagrees as first, the County is going to have no say so in who Novant and the local hospital board appoint or what they agree to, and they are not going to run it passed the County. They will not be seeking any approval whatsoever. He thinks it is difficult to impute that authority to the Board of Commissioners when the Board of Commissioners has no say so in it. The current members of the New Hanover Regional Medical Center are not making the decisions, they are negotiating appointments with Novant. Commissioner Zapple stated he sees Mr. Munford’s point of view, but disagrees with it and is just trying to follow the legal thought of the component unit in there. However, Mr. Munford has broadened his point of view, but he thinks that is something the LGC will take a hard look at that. Mr. Munford responded as to the LGC’s interest and involvement it is the inappropriate body by its formation to deal with the foundation. The LGC was created after the Great Depression because before then, not only were counties investing in things such as a local bank, etc. for political favors, but were also issuing bonds without really any control and whether a county could ever pay them off or not. That is where the LGC came in and he thinks the LGC is one of the financial strengths of NC because there are many local governments that need that type of oversight, advice, control, etc. Despite his praise of the LGC, he really thinks probably a sophisticated county like New Hanover County, could probably do just fine without its governance. That is a subjective opinion on his part and it is not something he would advocate, because this County may not be well-run someday. He does not think the LGC will have any interest in trying to govern a 501(c)(3) non- profit that first, will not be issuing bonds nor borrowing money, there is a restriction against that in the organizational documents, and there would be people other than this governing body which controls the County, appointing the local successor hospital board members. Even though there is a nexus to how they got there, he does not think it is going to see the foundation as an appropriate “ward” to supervise. The LGC, it has to be realized, does not really engage in counseling on how to invest. The LGC has its rules, the chair is the state treasurer, most of the members are council of state members, and it does have a staff. However, the staff has very limited authority, they have some great experience, but they really can't negotiate with the County from that standpoint. He thinks the structure the foundation would have would avoid LGC oversight and he does not think it needs it. Commissioner Zapple stated he thinks there is no doubt it would be a unique “ward” or a conversation that would come before the LGC, because as Mr. Munford stated, it does often act as the safety net in providing safeguards for counties. From his point of view, the LGC might embrace an opportunity to actually look at a healthy county bringing forward a substantial endowment and would look kindly upon loosening up by a little bit, but still maintaining a very low-risk investment strategy. He thinks the secretary of state as well as the state auditor also sit on the LGC board so there are some sophisticated people that are used to dealing with some major issues financially as well. He agreed with Mr. Munford that it will be up to the LGC to make the determination. Commissioner Zapple stated it is clear in the documents he has read that Novant will have the opportunity to ratify all of the new local hospital board members and asked Mr. Munford if that was correct. Mr. Munford confirmed it was correct. Commissioner Zapple continued stating that if one were to extend that thought and it has six appointments to the community foundation, with the proposed structure, will hand over a majority vote on the community foundation to those members who are ratified by Novant. Also in following up on Commissioner White’s earlier comment, he knows there is a ten-year window if Novant were to try to sell what is now New Hanover Regional Medical Center, but there is no window that controls it if Novant decides to merge their entire healthcare system or another healthcare system acquires Novant. That would change the ownership completely and he wants to know Mr. Munford’s opinion on if that occurs, does it mean the majority control of the community foundation at that point shifts to an unknown entity. Mr. Munford stated he thinks whoever the successor entity would be would have the same rights as Novant has, no more no less, as the acquiring or merged company. What has been built into the structure is that the local successor hospital board is self-perpetuating. Novant has the chance to blackball someone but it has to be for reasonable cause. He thinks with the requirements that the local successor hospital board have a diverse population, its focus is going to be on New Hanover County, not just Novant. The local successor NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 668 hospital board is going to be dealing with more than making these appointments as this hospital will be the major healthcare provider in this part of the state. In his experience serving on hospital boards, if one is willing to give the time, etc. the focus is to help the community, not Novant’s balance sheet as the member is not being paid a dime, it is the community. He does not see any undue influence by Novant on the members, it does not have the right to nominate someone to the board. Again, Novant can blackball someone but it has to be reasonable to withhold approval as they do have the right to approve members, but the burden is on Novant to explain why they are not giving approval. Commissioner Zapple asked if Novant was based in Winston-Salem. Mr. Munford responded that was correct the last time he checked as he does not represent Novant. Commissioner Zapple stated the majority of the appointments are handled by the new local hospital board, that is the control of Novant which is headquartered in Winston-Salem so their priorities may not reflect New Hanover County’s. In this particular case, we are not dealing with money that has been developed over a business through investments, rather we are talking about 100% of New Hanover County taxpayer money and he thinks that a lot of attention needs to be paid to where the control lays. It does give him concern. Commissioner Zapple stated that as it relates to the occurrence of regular meetings, he asked Mr. Munford if he sees a benefit in essentially trying to open up the foundation, which could be done through the bylaws in order for the public and media to have the opportunity to sit in and observe the discussions on how their money is being spent through disbursement. Mr. Munford stated to go back and answer the question in discussion on the open meetings law, when he was in the legislature, and when he served on the board of WakeMed hospital, it was subject to the open meetings law for reasons that this foundation will not be required by that. The open meetings law is a way to expose political bodies to the public and decisions. He has crafted the documentation for this foundation to not be a political body as he wanted it to be a fiduciary body that takes care of the County, that is its focus. In sitting through today’s meeting, he has heard people come in with a hat in hand, perfectly fine, to this political body, to seek funding. He does not want to see board members, or Novant either, pressing the board for pet projects. He does not want someone running for county commissioner saying, “If you do this, I'm going to make sure that no appointees are on that endowment, who don't support your pet project.” He thinks that would really weaken the commitment and the fiduciary responsibilities of the community foundation board. When the open meetings law is applied, the body becomes political because a member of this Board or a member of other people can start campaigning for changes on the way the community endowment is doing it. There can be people coming and distorting the process for political advantage in the foundation. It is not a political body; it is a deliberative fiduciary body. He thinks that the open meetings law changes that and would make it a political body, and to him, that would be very sad for the County. Commissioner Zapple stated that was an interesting take on it and asked Mr. Munford if he agreed that the very things he pointed out as negative, being a political body, could also happen behind closed doors and one way to ensure those discussions he referenced about pushing for pet projects or trying to campaign could be revealed very openly. Mr. Munford stated he disagreed with Commissioner Zapple and does not think the open meetings law opens anything other than how people vote and how they may distort the situation. He thinks that is important here because the Commissioners were all voted for and accounted for. The people on the foundation board are going to be responsible community citizens who are not paid, not elected, and are going to make important decisions without political bias and to have the open meetings law would take that away and he does not see any advantage to it. He has not had any bad experiences with the open meetings law, he just does not think it works. For example, in the legislature the majority party in the house or senate, they all get together except for maybe one or two of them, who get to stay home that day and they decide what they are going to do in private. Then they go to the house or senate floor, and the two who were not there will show up and then they vote for what they wanted to do and their vote is recorded. He thinks the open meetings law is important because it prevents open corruption on a floor but he does not think it stops corruption by any means. He also does not think that is the goal of what we have here. Again, it has its place and he has never had any bad experiences with it. He does not think this private foundation is a place for it. Commissioner Zapple stated that is where he and Mr. Munford split ways on this as a private foundation, because it is a private foundation with $1.25 billion of the public’s money and to him there is nothing private about it. He thinks Mr. Munford’s description of the legislature, in many ways makes his case for it and further thinks it is exactly how he sees an anecdote for that of making decisions behind closed doors and then walking out in the public to make a single vote. He does not see the harm in having regularly scheduled meetings and allowing the public to watch, not engage, how the board of directors decides to make disbursements. Mr. Munford responded that he thinks injecting politics into the foundation would be much more destructive than anything else this Board could do to it. Commissioner Zapple stated he does not see how that is injecting politics into it. Commissioner Barfield stated that people are making the assumption that a corrupt board has already been appointed, which is what he is hearing. He has a little more confidence in people than just to assume that whoever is appointed is going to go and do bad things. Most of the major hospital boards, and he knows that the NHRMC board has wrestled with this for a while, bring in people from outside of the board’s state to serve on it that has the right business acumen to get from point A to point B. He knows people who fly across the country to do this and get paid to be there. These boards are not looking for local talent; they are looking for talent that can help them get to the next level. To him that is more important than anything to make sure the right people are on the bus, seeking the right seats and also the right person is behind the bus driver, because that person has a lot of influence as well. Again, he would never make the assumption that people are inherently bad and are going to sit on the foundation board and automatically start having private meetings. That can be done regardless, in his opinion. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 669 Commissioner White asked Mr. Munford, hypothetically, what if a local county had an asset that it sought to convey and it generated over a billion dollars in cash, and what would be the best vehicle that he would recommend that county adopt to ensure that that money grows, always is available for the public good, and took the day-to-day political vagaries of politics out of the decision-making process. What would he come up with? Mr. Munford responded those were his marching orders. Commissioner White then asked if there was any improvement that Mr. Munford could recommend in the bylaws, setup, control, fiduciary responsibility the board will have, in the mechanics of the investments the board will make, etc. Mr. Munford stated there are some tweaks that can be discussed. First, is amending it as in how to do it. He does not like to see anything that is immutable and he does not like to see bylaws that say, “You can never change this” because things/circumstances can change. He would like to have it so nothing that the County would oppose could be adopted, but he would like to have a bit more flexibility in it than some of the directions he has been given just because of change. As to whether he knows if the Duke Endowment is immutable, Mr. Munford stated he does not know. Commissioner White commented that he would like to know that as it was created over 90 years ago and it seems to be doing well. He understands what Mr. Munford is saying as 50 to 75 years from now is this going to be the constitution by which that board is still governed and those are good questions. Mr. Munford stated he understands his point. Commissioner White further stated he does not think it should be changeable based on election outcome because the whole purpose of initiating this and hopefully getting this ball across the finish line is to depoliticize healthcare and in the process generate money to transform the community. That is the mission statement of this whole thing that is being done right now, depoliticize healthcare and change the community that we live in. If there are improvements that the Board can make to this, he is interested in hearing them. Mr. Munford responded he thinks the two three-year terms is very short for the tenure of someone on an endowment like this as there is a learning curve when someone gets on it and experience is important. He knows a lot of commissions will either be two five-year terms, or three three-year terms just to allow members more than six years to get their “sea legs.” Commissioner White asked if this Board would be in a position now to make a recommendation to change that as he sees a benefit in three three-year terms or two five-year terms. He stated he would support a motion to do either. Vice-Chair Kusek stated she would make a motion for the Board to extend it as she agrees with Mr. Munford, three three-year terms are consistent with other boards that she has been a part of in this County and otherwise. Chair Olson-Boseman stated she would second that. Motion: Vice-Chair Kusek MOVED, SECONDED by Chair Olson-Boseman to change the bylaws to reflect that the terms of the members will be three years with no more than three consecutive terms instead of three years with no more than two consecutive terms. Commissioner Zapple stated that he thinks the beauty of having two three-year terms is to get a constant refresh of the community foundation. Things rapidly change in this community and it would force some refreshing on a regular basis in order to get new ideas. One of the pitfalls of longer periods, such as is being suggested here, is there is a calcification of ideas and a hunkering down in the way things have been done all along. It is almost impossible with two three-year terms, and being able to get new blood on ideas forces more activity from the board. Hearing no further discussion, Chair Olson-Boseman asked for a vote on the motion on the floor. Upon vote, the MOTION PASSED 4 TO 1. Commissioner Zapple dissenting. Commissioner White asked Mr. Munford what other areas does he think could be improved. He also wanted to revisit the section on removal and know how the rest of the Board feels about changing it to either a supermajority, or Mr. Munford’s opinion on it, as he is more in Commissioner Barfield’s bucket of optimism in thinking good about people until they prove him otherwise. He can certainly see the downfall or the issues with just a majority that say, “Okay Mr. Smith, we do not like the way you’re saying this, so you are out of here.” He is not sure if he is comfortable with that and would like know if Mr. Munford would suggest going to a supermajority under section 6, revisit it all together, or for example, right now as it is setup for the airport authority and really anything else, any Commissioner can currently make a motion to replace the entire airport authority today without it being on the agenda nor being publicized and have a new slate of seven people and vote on it and it be done. Would the Board do that? Of course not. Politically it would be a nightmare, disruptive to an ongoing business enterprise, etc., but technically the Board of Commissioners can do that. If there is a problem person, and by that he does not mean a dissenter, he means someone committing fraud, not going to meetings, working an active sabotage of the business enterprise, the Board can remove that person and that is why that provision is in place. He asked Mr. Munford what he would say and recommend about section 6. Mr. Munford responded a supermajority requirement is much more usual in these types of situations than a simple majority and he would like it to be a supermajority. Commissioner White stated he would make a motion to amend Article IV, Section 6: Removal to require a supermajority. Vice-Chair Kusek stated she would second it. Motion: Commissioner White MOVED, SECONDED by Vice-Chair Kusek to amend Article IV, Section 6: Removal to be changed from requiring a simple majority to request the removal of a member to requiring a supermajority to request the removal of a member. Upon vote, the MOTION CARRIED UNANIMOUSLY. Chair Olson-Boseman asked Mr. Munford to continue. Mr. Munford stated of note, the Unitrust Formula is setup in a way that the foundation will be able to predict with some accuracy how much it will have from year to year because it has a 20-quarter rolling average on four percent times that average, which means it is not going to be feast or famine. In regard to bylaws being amended, he would like to see that the bylaws could only be amended by a supermajority vote of the board of directors and it could even be a super supermajority. It might be that like NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 670 with a supermajority, it would mean at least three out of five of the County appointees would have to support amendment. He does not care if it would be four out of the five County appointees, but he would hate to see one difficult director cause a stalemate at some point in the future, in amending the bylaws. Chair Olson-Boseman asked Mr. Munford what he was suggesting. Mr. Munford responded he put together a draft with a supermajority that basically nine of 11 directors could amend the bylaws which would be for example, six Novant directors and three of the five County directors. If this Board wants to make it require four out of the five County directors to be in agreement, that is fine too, he just does not want a rogue director to mess up moving forward. Commissioner Barfield stated that he is fine with the way it sits at supermajority as he does not see how one is going to sway a whole lot either way. In response to Board questions, Mr. Munford confirmed it would be six Novant and three County directors, 75%, for supermajority. After a brief discussion, Chair Olson-Boseman stated that the Board was fine with supermajority. Mr. Munford stated those were his only comments to Commissioner White’s questions. As to whether he thinks the bylaws are perfect, he stated he would not say they are perfect, but they are very good and he will not let perfect be the enemy of good. Commissioner Zapple stated one of the details is that there is paid staff with a president/chief executive officer of the corporation who presides over the board meetings, which puts that person in charge of the meetings. He thinks it would be appropriate to have the board chairman be the one to preside over the board meetings. Chair Olson-Boseman asked if there a second to Commissioner Zapple’s request to have the chairman of the board of directors in charge of the meetings instead of the president/chief executive officer of the corporation. Hearing no second, Chair Olson-Boseman stated the request failed for the lack of a second. Mr. Munford explained that the officers are appointed by the board of directors and the officers’ roles are to do the operational work of the foundation. For example, the board of directors would direct the president and/or secretary to file all the documents with the IRS, etc. It is very possible for a board member to be an officer if that is what the board says. He has provided the great flexibility on what type of officers are appointed. Every corporation needs to have a president and a secretary to file tax returns or do whatever. None of the officers have any authority other than what is delegated to them by the board of directors. Commissioner Zapple stated as he understands it the president/CEO of the corporation would be a paid position. Mr. Munford responded that it could be, but it depends on the role of what the president is. In a lot of non-profit organizations, the president of the non-profit is a volunteer just like the board members if the role is negligible, such as just signing documents and authenticating the minutes. However, if the directors felt they needed a fulltime president or something like that to manage it as has occurred in some large endowments, they do have the authority to hire someone to do that. Commissioner Zapple stated that in this case it is $1.25 billion that is being discussed, it is a large corporation with a tremendous amount of responsibility for the president. As such, he thinks in this case, the board of directors would be one body and there would be a professional staff represented by the president/CEO who would then hire the rest of the staff or the board could appoint the rest of the staff and the professional staff would be paid. Mr. Munford stated that he agrees with that statement. Commissioner Zapple asked Mr. Munford should the CEO run the board of directors’ meetings. Mr. Munford responded that could be changed to have whatever. Commissioner Zapple stated he thinks it is appropriate for the chairman of the board be the one that is running the meetings. Commissioner White asked Mr. Munford if he would predict that once the foundation is created, the closing occurs, and the money is transferred, that the 11-person board will then go into the private sector and hire a president that will then preside as an executive director, for lack of a better phrase, over the meetings, the recommended investment strategy, the requests that will be coming in for grants each year, etc. Mr. Munford responded there will have to be an executive staff and he confirmed it will have to have a president/CEO. Commissioner White stated typically in the ones he has seen, such as Bob Iger who was CEO of Disney for 16 years and would run the meetings. It was not the chairman of the board, it was the CEO, and he asked Mr. Munford if that was what he envisioned. Mr. Munford responded that the CEO answers to the board and is the only one who knows the day-to-day operations. Commissioner White stated he would respectfully suggest that changing it to have the chairman of the board, who will be serving for no compensation and will have a fiduciary role but a limited oversight, would not be the best person to run meetings and oversee the day-to-day operations. He asked Mr. Munford if he agrees with this. Mr. Munford responded that it is very usual for the CEO to be the chairman of the board, he would agree with him on that. Commissioner White stated he is not sure he envisioned that or not. He envisioned 11 people sitting on the board and hiring someone to run a billion+ dollar foundation and telling that person they are the person hired and here is the direction that the board wants to go and this entity and they are being employed to take it in that direction and until he or she does not, they will have a job. Currently, the hospital has a CEO and he is not chairman of the board, but he runs the meetings and presents most of the items at the meetings and the chairman runs the meetings, and asked Mr. Munford if that is what is being setup in this case. Mr. Munford responded that is what he is thinking. Commissioner Zapple stated he thinks in models that Commissioner White is getting at is that the CEO plays a major role in every meeting. Again, he thinks it is important for the board of directors not to be viewed as someone serving for the CEO, and that it is clear the line of command is they are chairing the meetings, at the appropriate time, usually at the top of the meeting, they ask for the presentation or report from the CEO, who has absolute responsibility of running the corporation and day-to-day aspects, etc. However, at the meetings the chairman is in charge and he thinks that is important because otherwise, it undercuts the authority of the board of directors. Commissioner White stated that he agrees with Commissioner Zapple and can see a year into this, these couple of sections probably being subject to potential amendment in how the meetings are run, what authority does the board NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 671 want to delegate to the new CEO just hired, etc. just as is done for the county manager position and how the hospital board does for its CEO. He thinks there will be some opportunity to amend the day-to-day oversight in this document, once the entity gets off the ground so it can be more efficient and more responsive to grant applicants, etc. He is not sure they disagree on that and asked if there is inconsistent language in section 7 that suggests otherwise. Commissioner Zapple responded that he thinks it is the third sentence of section 7 and is also referenced earlier on in the document. Mr. Munford stated what he was envisioning with section 7 was that the president would be in charge of putting together the agenda and running the meeting so that if there is a chairman and there is a question of who is supposed to do it, the president is the paid executive, that person puts together the agenda and the directors can call or email the president of what to put on the agenda. The president would be in charge of making sure there is a secretary to take minutes and do all of the logistics. He was really wanting to take that off the volunteer chairman with that and understands Commissioner Zapple’s concern about perception, but he thinks from a practice standpoint he thought it would be a good way to start. Commissioner Barfield stated that he agrees with Commissioner Zapple’s stance. The hospital board of trustees has a chair that presides over the meetings and the CEO is there to offer comments, give direction, to help facilitate the agenda, but the chair does preside over the meetings. To him, it is semantics because the document clearly states the president works for the board. He thinks you can give the chair, the president, or whoever certain directives in terms of what is desired for that person to do, which is no different than what this Board does with County Manager Coudriet. This Board really does not make the agenda, it is County Manager Coudriet and his team that pretty much pulls the agenda together, the Board sees it, ratifies it, add things to it from time to time, but for the most part it is County Manager Coudriet’s team that does that. He thinks giving those powers to the president in advance would give that person clear direction in terms of what the expectation is, but it is still semantics to him and at the end of the day that person works for the board. Commissioner White stated he agrees with that and if that paragraph needs to be clarified a little bit to adopt the model that Commissioner Barfield put very well, similar to what this Board does with County Manager Coudriet, maybe some modifications can be made to it. He thinks Mr. Munford sees what the Board is getting at. Mr. Munford responded that he does and the language can be modified to make it clearer and perhaps avoid any confusion as to each other’s authority. Commissioner Zapple stated Article IV, Section 8 is the other section he was referring to earlier and a word change would take of it in the section. Commissioner Zapple stated as to the board being allowed to meet out of state, he does not see the purpose or what could be done productively by having board meetings out of state, especially when it is dealing with something that is hyper-local in this County and taxpayer money. He would like for the phrase “…or out of state…” to be removed. Commissioner Barfield stated as he served on the hospital board of trustees for four years, going to the Governance Institutes in other states, greater knowledge is gained. Just like with the Commissioners going to national conferences, it allows members to have synergy with others and glean from others as well from a bigger pool. He has always believed he cannot learn what he needs to learn just in New Hanover County. He has to get around other people that have different expertise so they can help him sharpen his skills. Again, he thinks collaborating in other places, it is not a challenge when it is seen that most boards are bringing board members from other states to serve on their board. He thinks it would provide a great learning opportunity and if for nothing else than for the people of New Hanover County to see what is happening at a Mayo Clinic or something. Commissioner Zapple stated that he thinks there has been a miscommunication and apologized as he does agree with Commissioner Barfield’s point of view of traveling to conferences and seeing how other elected representatives, and in this case, other foundations, handle their work is very important. He was referring to having a full board meeting out of state. He supports traveling for educational purposes and experience, but not conducting a full board meeting. Commissioner Barfield stated that the state county commissioners board just had a meeting in Washington, D.C. Commissioner Zapple stated that was the state and what he is talking about here is the foundation board. Commissioner Barfield reiterated that it is a board that met in Washington, D.C. and brought people in from Washington, D.C. to speak to it. Commissioner Zapple stated that, again, he is talking about the special meetings section and where it states “Such meetings may be held either within or without the State of North Carolina, as fixed by the person or persons calling the meeting.” He understands the national committee or group that Commissioner Barfield is talking about, that is their job to meet throughout the entire United States. The work of this community foundation is centered here in New Hanover County so for the board meetings alone, not individual or groups of board members meeting elsewhere as he totally supports that, but for the board meetings, he cannot imagine why it would want to meet out of state. Vice-Chair Kusek stated she would like to make a motion to accept the foundation bylaws as presented subject to the changes that have been approved and for the document to be returned for an ultimate second review by the Board. Commissioner White stated he would second the motion. Motion: Vice-Chair Kusek MOVED, SECONDED by Commissioner White to accept the foundation bylaws as presented subject to the changes that have been approved and for the document to be returned for an ultimate second review by the Board. Upon vote, the MOTION CARRIED 4 TO 1. Commissioner Zapple dissenting. Chair Olson-Boseman thanked Mr. Munford for discussing matter with the Board. CONSIDERATION AND ADOPTION OF BUDGET AMENDMENT 21-013 AND APPROVAL OF THE AWARD OF BID AND CONTRACT TO ES&J ENTERPRISES, INC. FOR THE PARTIAL CLOSURE OF LANDFILL CELLS 2-6E, PHASE 4 Environmental Management Director Joe Suleyman stated this is the largest project not only during his tenure with the department, but in the department's history. It is a 30-acre-plus closure project on the northern side of the property of the New Hanover County landfill, and once complete it will completely close out the entire NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 672 northern part of the facility. There were four qualified companies that submitted bids. Of those bids, it was determined the lowest responsible bidder did not meet the minimum landfill cell construction and cell closure experience requirements as set forth in bidder instructions. This was confirmed by the engineer of record, SCS Engineers, who thoroughly reviewed the bids. ES&J Enterprises, the second lowest responsible bidder, did meet the criteria which was confirmed in bid review. The request is for the Board to award the bid to ES&J Enterprises for the partial closure of landfill cells 2-6E, Phase 4 and to adopt the associated budget amendment. Hearing no further discussion, Chairman Olson-Boseman asked for the Board’s direction on the request. Motion: Chair Olson-Boseman MOVED, SECONDED by Vice-Chair Kusek, to adopt a resolution authorizing the award of the bid and contract for the partial closure of landfill cells 2-6E, Phase 4, at a cost of $8,979,505.00 to ES&J Enterprises, Inc. and approve the associated budget amendment 21-013 transferring funds into the Northern Property Capital Project Fund. The Board commended Mr. Suleyman on his work for the landfill and the community. The Board further thanked him for his efforts with the landfill gas to energy project to capture landfill gas and turn it into energy. Hearing no further discussion, Chair Olson-Boseman asked for a vote on the motion on the floor. Upon vote, the MOTION CARRIED UNANIMOUSLY. A copy of the resolution and budget amendment are hereby incorporated as part of the minutes and are contained in Exhibit Book XLII, Page 18.5. COMMITTEE APPOINTMENTS Appointments to the New Hanover County/City of Wilmington Community Relations Advisory Committee Chair Olson-Boseman reported that one vacancy exists in each of the following categories: Business Community, Education Community, and Faith Community on the New Hanover County/City of Wilmington Community Relations Advisory Committee with four applications available for consideration. The Education Community category is being re-advertised as no applications were received. Commissioner White nominated John Dismukes in the Business Community category. Vice-Chair Kusek seconded the nomination. Commissioner Barfield nominated Reddgo Long, Jr. in the Faith Community category. Chair Olson-Boseman seconded the nomination. Commissioner Zapple nominated Megan Mullins in the Business Community category. Chair Olson- Boseman seconded the nomination. Chair Olson-Boseman nominated Bandorian Cromartie in the Business Community category. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nominations on the floor. Vote Results: The Board voted 2 TO 3 appoint John Dismukes in the Business Category to the New Hanover County/City of Wilmington Community Relations Advisory Committee to serve three year terms with the terms to expire on September 30, 2023. Vice-Chair Kusek and Commissioner White voted in favor. Vote Results: The Board UNANIMOUSLY to appoint Reddgo Long, Jr. in the Faith Category to the New Hanover County/City of Wilmington Community Relations Advisory Committee to serve a three-year term with the term to expire on September 30, 2023. Vote Results: The Board voted in the majority to appoint Megan Mullins in the Business Category to the New Hanover County/City of Wilmington Community Relations Advisory Committee to serve a three-year term with the term to expire on September 30, 2023. Chair Olson-Boseman and Commissioners Barfield, White, and Zapple voted in favor. Appointment to the New Hanover County Commission on African-American History, Heritage and Culture Chair Olson-Boseman reported that one vacancy exists on the New Hanover County Commission on African- American History, Heritage and Culture in the At-Large category with four applications available for consideration. Commissioner Zapple nominated Tracion Flood in the At-Large category for appointment. Commissioner Barfield seconded the nomination. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nomination on the floor. Vote Results: The Board voted UNANIMOUSLY to appoint Tracion Flood in the At-Large category to New Hanover County Commission on African-American History, Heritage and Culture to serve an unexpired term with the term to expire on August 31, 2021. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 673 Appointments to the New Hanover County Juvenile Crime Prevention Council Chair Olson-Boseman reported that four vacancies exist in the At-Large category for the New Hanover County Juvenile Crime Prevention Council with two applicants eligible for reappointment and five additional applications available for consideration. Commissioner Zapple nominated Kristen Cotiaux, Carolyn Jackson, and Beth Looney for appointment and Kelly C. Silivanch for re-appointment in the At-Large category. Chair Olson-Boseman nominated Martin Green and Kelly C. Silivanch for reappointment and Carolyn Jackson and Beth Looney for appointment in the At-Large category. Commissioner White seconded the nominations. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nominations on the floor. Vote Results: The Board voted UNANIMOUSLY to reappoint Martin Green and Kelli C. Silivanch and appoint Carolyn Jackson and Beth Looney in the At-Large category to the New Hanover County Juvenile Crime Prevention Council to serve two year terms with the terms to expire on September 30, 2022 and to appoint Assistant County Manager Tufanna Bradley as the Commissioners’ representative. Appointment to the New Hanover County Library Advisory Board Chair Olson-Boseman reported that one vacancy exists on the New Hanover County Library Advisory Board with three applications available for consideration. Commissioner Barfield nominated Kevin Maurer for appointment. Commissioner White seconded the nomination. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nomination on the floor. Vote Results: The Board voted UNANIMOUSLY to appoint Kevin Maurer to New Hanover County Library Advisory Board to serve a three-year term with the term to expire on August 31, 2023. Appointments to the New Hanover County Tourism Development Authority Chair Olson-Boseman reported that one vacancy exists in each of the following categories: The Wrightsville Beach Hotel Owner/Manager category and the Tourist Attraction category on the New Hanover County Tourism Development Authority with three applications available for consideration. Vice-Chair Kusek nominated Steve Varieur in the Wrightsville Beach Hotel Owner/Manager category for appointment. Commissioner Barfield seconded the nomination. Commissioner Zapple nominated Mary Baggett Wrightsville Beach Hotel Owner/Manager category for appointment and Michael (Hap) Fatzinger in the Tourist Attraction category. Chair Olson-Boseman seconded the nominations. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nominations on the floor. Vote Results: The Board voted in the majority to appoint Steve Varieur in the Wrightsville Beach Hotel Owner/Manager category for appointment to serve a three-year term with the term to expire December 31, 2023 to the New Hanover County Tourism Development Authority. Vice-Chair Kusek and Commissioners Barfield and White voted in favor. Vote Results: The Board voted UNANIMOUSLY to appoint Michael (Hap) Fatzinger in the Tourist Attraction category to serve an unexpired term with the term to expire December 31, 2022 to the New Hanover County Tourism Development Authority. Appointments to the New Hanover Regional Medical Center Board of Trustees Chair Olson-Boseman reported that four vacancies exist on the New Hanover Regional Medical Center Board of Trustees with four applicants eligible for reappointment and six additional applications available for consideration. Vice-Chair Kusek nominated Brian Eckel, Robert T. McGhee, and Howard O. Rockness for reappointment and Dr. John S. Pace for appointment. Chair Olson-Boseman seconded the nominations. Commissioner White nominated James Brumit for reappointment. Hearing no further nominations, Chair Olson-Boseman asked for a vote on the nominations on the floor. Vote Results: The Board voted UNANIMOUSLY to reappoint Brian Eckel, Robert T. McGhee, and Howard O. Rockness and appoint Dr. John S. Pace to the New Hanover Regional Medical Center Board of Trustees to serve three year terms with the terms to expire on September 30, 2023. PUBLIC COMMENT ON NON-AGENDA ITEMS Chair Olson-Boseman reported that one person signed up to speak on non-agenda items. NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34 REGULAR MEETING, SEPTEMBER 21, 2020 PAGE 674 Donna Pope, resident of Pender Avenue, stated she is chair of the Cape Fear Museum (CFM) Advisory Board and since the County took ownership of CFM in 1977, it has grown with dedicated work of professional staff and community volunteers. It has also become a Smithsonian affiliate and is a community education resource. Upon recent reopening, there were 280 visitors in the first week and the online programming has 115,000 views this year. The County expansion to the free WiFi has allowed the museum park to provide a centrally located area for children and their parents to engage in online learning outside in the open air. On behalf of the CFM Advisory Board, she expressed appreciation for bringing CFM under county leadership years ago and requested continued support particularly in the need for storage of the collection. There are over 57,000 artifacts that date from the pre-colonial st Native American settlements to the 21 century and collection continues. The CFM Advisory Board asks for the Commissioners help in funding around 10,000 square feet to move the collection to an area where there will not be the concerns of flooding. Other physical needs can be addressed over time as COVID-19 has brought economic uncertainty and cultural sites have not been immune to that impact. The American Alliance of Museums estimates that up to one-third of museums in the U.S. may have to close. The CFM Advisory Board believes now, more than ever, it is time to support the museum and help it flourish. ADDITIONAL AGENDA ITEMS OF BUSINESS Commissioner Barfield welcomed Linda Thompson to the organization as the County’s Chief Diversity and Equity Officer. He looks forward to working and collaborating with her to see this County continue to exceed expectations in southeastern North Carolina. Commissioner Zapple stated the Board had an opportunity with the setting the community foundation bylaws for generations to come as an open foundation that holds regular meetings open to the public and media to provide transparency and clarity to the public on how their money is being handled and dispersed. It is a foundation that puts responsibility and accountability squarely on the board of directors and he thinks this Board made great strides in making that happen today. It allows the citizens to be assured that their money is being handled in an appropriate manner. If we want to build public trust in this entire transaction and raise the confidence of every citizen that selling the County's most valuable asset, the hospital, is worth it, opening up the community foundation with regularly scheduled meetings that allows the public to sit in and observe is the way to do it. He hopes that is kept at the top of mind while work is being done on the final documents and are being reviewed by the as the Board. Chair Olson-Boseman thanked Mr. Munford, welcomed Ms. Thompson to the organization, and stated she wants to tell the public that the Commissioners have worked very hard with the foundation. Any suggestion that any of them are doing anything behind closed doors or not in front is just not true. She does not appreciate the continued suggestions and innuendos. ADJOURNMENT There being no further business, Chair Olson-Boseman adjourned the meeting at 11:50 a.m. Respectfully submitted, Kymberleigh G. Crowell Clerk to the Board Please note that the above minutes are not a verbatim record of the New Hanover County Board of Commissioners meeting. The entire proceedings are available online at www.nhcgov.com.