2006-01-20 Budget Work Session
NEW HANOVER COUNTY BOARD OF COMMISSIONERS
BUDGET WORK SESSION, JANUARY 20, 2006
BOOK 30
PAGE 500
ASSEMBLY
The New Hanover County Board of Commissioners held a Budget Work Session on Friday, January 20,2006, at
8:35 a.ill. in the Conference Room of the Wilmington International Airport, 1740 Airport Boulevard, Wilmington, North
Carolina.
Members present were: Chairman Robert G. Greer; Vice-Chairman William A. Caster; Commissioner Ted Davis,
Jr.; Commissioner William A. Kopp, Jr.; Commissioner Nancy H. Pritchett; County Manager Bruce T. Shell; County
Attorney Wanda M. Copley and Clerk to the Board Sheila 1. Schult.
Others present were: Budget Director Cam Griffin; Senior Budget Analyst Norma Troutman; Budget Analyst
Donna Seal; Finance Director Avril M. Pinder; Assistant County Manager Patricia A. Melvin; Assistant County Manager
Dave Weaver; Sheriff S. A. Causey; Chief Deputy W. T. Parker; Parks Director Neal Lewis and PublicInformation Officer
Mark Boyer.
Chairman Greer called the meeting to order and requested County Manager Bruce Shell present a budget overview
for FY 2006-2007.
PRESENTATION AND DISCUSSION OF THE FY 2006-2007 BUDGET
County Manager Shell began the presentation by informing the Board that the County remains financially strong
with the tax base expected to grow at a rate of3% and with retail sales remaining strong projecting an increase in tax revenue
by 4%. County Staff is prepared to utilize excess fund balance in the amount of $8 million to minimize any need for an
increase in the tax rate. Increases are expected in Medicaid funding in the amount of $1. 5 million, utility cost increases in the
amount of $600,000, proposed salary increases for 2% merit and 2% market in the amount of $2.4 million; increase in
insurance costs in the amount of$1.5 million. The schools debt service is expected to increase in the amount of$2.3 million
while the Cape Fear Community College debit service is expected to decrease $400,000.
County departments have been asked to hold their budgets at the current rate. A budget team will meet with each
department to review their requests. The request from the Schools has not yet been received.
In conclusion, County Manager Shell reported that at this point in the budget process there is a five-cent gap
between projected revenues and expenditures but that it is early in the budget process and more concrete figures will be
forthcoming as the budget process progresses.
PRESENTATION OF COUNTY'S 2006-2007 PROGRAMMATIC GOALS
Senior Budget Analyst Norma Troutman presented the draft of the County's 2006-2007 Programmatic Goals
explaining that upon adoption by the Board, the departments will be instructed to develop their own individual goals and
performance measures based on the County's Programmatic Goals.
After discussion, the Board directed Staff to make changes in wording and for the revised County's 2006-2007
Programmatic Goals to be brought to the Board for approval at their January 23,2006 meeting.
PRESENTATION OF ALTERNATIVE REVENUE OPPORTUNITIES
Budget Director Cam Griffin reported that alternative revenue options are available by seeking legislation to allow
all counties to enact any or all of several revenue options from among those that have already been authorized for another
county. Staff has reviewed the following options:
. Support legislation that will give counties the option of applying an impact tax to support capital
improvements for County Government infrastructure responsibilities such as needs of education and the
construction of j ails and any other County facility currently authorized under existing law.
. In North Carolina, Ad Valorem Property Tax and Sales Tax are the two primary revenue sources for
counties. There is currently a limit on the sales tax rate. Some jurisdictions have requested the authority
to increase sales tax by an additional one-half cent for specific purposes.
. Impact Fees are charged to new development to finance public infrastructure or capital assets that serve
that development or new development.
. Land Transfer Tax is a tax on instruments conveying interest in real property that can be designed for a
specific purpose or any lawful purpose.
Budget Director Griffin requested the Board notifY Staff of any other alternative revenue sources they would like to
have reviewed.
PRESENTATION OF BOND ISSUE CONSIDERATIONS
County Manager Shell reported that New Hanover County staff and the City of Wilmington staff would like to offer
the following proposal with regard to a proposed parks and greenspace bond referendum to be held in May of 2006.
Staff proposes the bond referendum be a combined effort of the City of Wilmington and New Hanover County.
Under the agreement, Staff proposes that the referendum be inclusive of both governments in the amount of $3 5 million and
be offered under the name of New Hanover County.
Through this proposal, the County and City will enter into an interlocal agreement in advance of the referendum by
which the funds of the bond will be allocated to each government agency based upon the approved projects.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS
BUDGET WORK SESSION, JANUARY 20, 2006
BOOK 30
PAGE 501
A public hearing on the County's proposed Master Plan for Parks, Recreation and Open Space will be held at the
Board's February 6,2006 meeting. The Board will then vote on the projects to be included in the bond referendum. Also
included in the County's bond referendum will be funding for the libraries and expansion of the Cape Fear Museum.
BREAK
Chairman Greer called for a break for a joint news conference with the City of Wilmington concerning a proposed
parks and greenspace bond referendum at 9:55 a.m. until 1 0:40 a.m.
CONTINUATION OF PRESENTATION OF BOND ISSUE CONSIDERATIONS
Parks Director Neal Lewis reported on the proposed Master Plan for Parks, Recreation and Open Space listing and
explaining the following projects:
o Renovations to Monterey Heights Park, Parkwood, and Arrowhead Park.
o Completion of Veterans Park and Ogden Park.
o Development of Battle Park, Wrightsboro Park and water access.
o Acquisition of land.
o Planning and design.
o Carolina Beach, Kure Beach and Wrightsville Beach projects.
After discussion on the proposed County projects, the Board instructed Staff to make changes to the draft for
presentation at their January 23,2006 meeting.
On behalf of the Board, Chairman Greer thanked Parks Director Lewis for his presentation.
PRESENTATION ON MEDICAID
Social Services Human Services Planner Chris McNamee and Social Services Human Services Agency Business
Manager James Oxendine reported that the County funds 5% of Medicaid costs. As of January 2006, Medicaid eligibility
includes the following groups:
o Low income families with children (0-18) whose family income is under 200% of the federal poverty
level.
o Individuals (19-59) with income under 185% of poverty.
o Pregnant women with income under 185% of poverty.
o Aged, blind and disabled.
o Groups being served by New Hanover County as of December 2005:
o Aged, blind and disabled - 31 %
o Medicaid children - 45%
o Health Choice children - 11 %
o Other adults - 13%
In closing, Human Services Planner McNamee reported that challenges facing the Department of Health are:
o More than 47,000 New Hanover County residents live below 200% of the poverty level.
o More than 4,200 children ages 0 and 18 in New Hanover County are uninsured.
o 21,223 individuals between the ages of 18 and 64 in New Hanover County are uninsured.
o Aging population.
o Growing population.
o Pediatricians who will not accept additional Medicaid.
o New coverage group as of January 2006.
o Increased caseloads.
o Maintaining accuracy while need for services increases.
o Impact of growth and policy changes on budget will result in an additional $1.5 million.
On behalf of the Board, Chairman Greer thanked Ms. McNamee and Mr. Oxendine for the presentation.
BREAK
Chairman Greer called for a break at 12:00 p.m. until 12:20 p.m.
PRESENTATION OF IMPACT OF STATE GOVERNMENT ON THE COUNTY
Budget Director Griffin reported that it is too early to count on a revenue surplus in the State budget for the current
fiscal year. Long-term prospects depend largely on the status of temporary tax increases as the Y, cent sales tax and the upper
income tax rate. Medicaid and state employee health insurance costs have a major impact on the state budget.
State decisions that impact county budgets include:
o Voting machines.
o Mental health reform.
o 35% lottery revenues for education.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS
BUDGET WORK SESSION, JANUARY 20, 2006
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o The shift of children ages 0- 5 from Health Choice (County does not fund) to Medicaid, which
the County funds at a rate of 5%.
o Increase in Medicaid dental rates.
o School funding and pay increases for school employees.
o Motor vehicle property tax and registration of vehicles will be paid at same time.
o Decisions on 911 funding.
o Additional exemptions or exclusions from local government property tax.
PRESENTATION OF NON-COUNTY AGENCIES
Budget Director Griffin reported on the non-county agencies that the County currently funds. There are also three
agencies that in FY 01-02 the County entered into a multi -year funding arrangement. To protect County funds disbursed to
agencies receiving funding, regulations and reporting requirements are in place. Funds are only approved for purposes that
meet the legislative Public Purpose Requirements for Counties. Currently non-county agencies can request funding by
submitting a written request for consideration as part of the budget process for the next fiscal year.
Budget Director Griffin presented information for the Board's review on Capital Projects, cost savings achieved by
County departments and the vehicle replacement program.
In closing, Budget Director Griffin stated that staff looks forward to working with the Commissioners during the
remainder of the budget process and requested that she be notified of any specific information that would assist in that
process.
Hearing no further comments, Chairman Greer adjourned the meeting at 1 :00 p.m.
Respectfully submitted,
Sheila 1. Schult
Clerk to the Board