2023-05-11 Agenda Review
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 35
AGENDA REVIEW MEETING, MAY 11, 2023 PAGE 763
ASSEMBLY
The New Hanover County Board of Commissioners met May 11, 2023 at 3:05 p.m. for Agenda Review in
Conference Rooms 138-139 at the New Hanover County Government Center, 230 Government Center Drive,
Wilmington, North Carolina.
Members present: Chair Bill Rivenbark; Vice-Chair LeAnn Pierce; Commissioner Jonathan Barfield, Jr.;
Commissioner Dane Scalise; and Commissioner Rob Zapple.
Staff present: County Manager Chris Coudriet; Deputy County Attorney Kemp P. Burpeau; and Clerk to the
Board Kymberleigh G. Crowell.
Chair Rivenbark called the Agenda Review meeting to order and announced that the purpose of the meeting
is to review and discuss the agenda items for the May 15, 2023 Regular Meeting with discussions as noted:
Consent Agenda Item #2: Approval of the Contract Renewal for Audit Services with Cherry Bekaert LLP
for Fiscal Year 2022-2023. County Manager Coudriet explained in response to questions that the audit is sent to
Local Government Commission (LGC) for approval. Once the LGC approves and accepts the audit, the auditor will
make the formal presentation to the Board. All local government units must submit their audit for LGC approval. The
County has never had an audit questioned by the LGC or not submitted an audit. One time the audit was submitted
late but with the LGC’s knowledge that it would be late. Regarding the County’s contract with Cherry Bekaert LLP,
Deputy Chief Financial Officer Martha Wayne stated that this will be the second year of the current contract. The
previous contract was for four years with two contract extensions, both for two years. The audit contract was bid
out last year and she noted that there are a limited number of firms that manage local government audits. Cherry
Bekaert LLP was the only firm to submit a bid last year as the other firms stated that they did not have the capacity
to submit a bid.
Consent Agenda Item #3: Adoption of Budget Amendments. Staff provided the following information in
response to Board questions regarding budget amendments (B/A) 23-062, 23-064, and 23-066:
B/A 23-062: Environmental Management Director Joe Suleyman stated that most of the donations are
in-kind and staff time. Examples of in-kind donations include latex gloves, trash receptacles, and
stickers. The program teaches students at the elementary school level how their trash from lunchtime
becomes compost.
B/A 23-064: County Manager Coudriet stated that he will confirm with Chief Financial Officer Eric
Credle which installment loan is being used and provide that information via email.
B/A 23-066: Ms. Wayne stated that the funds have not been reassigned at this time. During the internal
audit, staff found that some funds had not been used for their intended purpose and had to be
recouped. There is no immediate plan for those funds unless the Board directs otherwise.
Regular Agenda Item #6: Public Hearing and Consideration of Approval of a Development Agreement for
the Redevelopment of the Wilmington City Block bounded by Chestnut Street, Grace Street, Second Street, and
North Third Street. County Manager Coudriet stated that this is the third time the Board will be considering the
project. A presentation will be provided on Monday and if approved, final bidding numbers will be provided to the
Board in July, and staff will prepare to go before the LGC for their approval in September. The item will be conducted
as a public hearing, although a public hearing is not required as the Board fulfilled that requirement in March 2021.
Discussion ensued regarding parking spaces in the parking deck. County Manager Coudriet confirmed there will be
630 parking spaces in the deck, and with restriping there could be close to 700 spaces. The parking deck is not solely
for County use. There are lease agreements in place for hotels to use the parking deck, but there is no longer a
reservation for the court system. There is more than adequate parking in the parking deck for this project. Assistant
County Manager Lisa Wurtzbacher stated that the parking contract is intentionally vague because details have not
yet been worked out. A parking study has been completed. The County will continue to own and manage the deck
and will likely lease spaces to the developer. Additional parking can be accommodated by restriping, but there is no
option to add to the deck. The County currently has leases with two hotels for parking. Parking revenue comes back
to the County, including any leased spaces for the developer. Regarding the 80/20 split on cost reduction for anything
that comes in under budget, the contractor and developer will split the 20%, so essentially, they would both receive
10% of the cost savings on construction costs. This was set up to ensure that the contractor and developer are trying
to achieve cost savings throughout the project. Regarding the reduction in lighting, Chief Facilities Officer Sara
Warmuth stated that the quantity of the lighting is being reduced but does not remove LED lighting. The users of the
facility will not notice the change. Regarding the removal of the terraces, Ms. Warmuth stated that was done in
agreement with the staff. For the staff terrace, it was determined that it was not needed at this time but is something
that can be added in the future. For the other terrace, it was determined that an expansion of the conditioned space
was preferred by staff and concerns were expressed about items getting tossed off the terrace. Staff would be able
to better manage the area as a conditioned space. There are still discussions going on about what could go on the
exterior wall where the terrace was going to be, but no decision has been made. Regarding the schedule of the
project, if approved, construction could start this fall with a potential completion date in early 2025.
Regular Agenda Items #8: Presentation of Fiscal Year 2023-2024 Recommended Budget and Fiscal Year
2024-2028 Capital Improvement Plan. County Manager Coudriet stated that Budget Officer Michelle Daniels will
provide a presentation of the proposed budget. The proposed budget will be available on the County website and a
line item budget is available for review. Ms. Daniels then presented the following information:
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 35
AGENDA REVIEW MEETING, MAY 11, 2023 PAGE 764
Fiscal Year (FY) 2023-2024 Recommended Budget:
Fund summaries:
Total spending plan: $590.8 million
Major fund revenues:
Major General Fund revenues:
Property taxes:
3.55% growth in assessed value
99.6% collection rate
Approximately $12.0 million increase
Sales taxes:
County has received high receipts in the first six months of the current fiscal year –
irregular since then:
Currently 4.7% ($3.3 million) over budget
Continued inflation and a generally strong economy positively impact projected receipts
Federal Reserve actions to cool the economy pose a risk
FY 2024 budget: no growth over current year projections
Investment income and fund balance:
Investment income: $5.8 million versus $0.2 million in the prior year
Fund balance usage: $5.8 million:
Funded from the above 21% balance
For one-time capital items:
Sheriff: vehicles, furniture, fixtures, and equipment (FFE) for vice/narcotics
facility
South College Road trail
Ogden Park playground replacement
Museum park shade
Design costs: Cooperative Extension administrative building and Trails End pier
Regarding the museum park shade as it relates to spending funds with the potential of Project Grace to
move forward, County Manager Coudriet stated that the plan is that existing Cape Fear Museum facility and the park
remain. As such, long term there is going to be community use on that site. The shade will allow for the park to be
better utilized by patrons.
General Fund Expenditures:
Enhancements - $4.4 million:
$1.9 million = 25 new positions
Medicaid Expansion (5) Mental Health and Substance Use (5)
$2.5 million = Capital Outlay (part of appropriated fund balance noted above)
Capital Projects - $44 million:
Last Frontier infrastructure: $23.5 million
North Chase Library : $8.4 million
Smith Creek Park and North College Road Trail: $6 million
CFCC Nursing renovations: $3.6 million
Echo Farms: $1 million
Regarding Echo Farms Park, County Manager Coudriet stated that the long-term plan for the park would be
the addition of four or five clay courts, which would complete the project. For the CFCC Nursing renovations, the
cost covers just the first phase. The $8.4 million for the North Chase Library covers the complete costs for the new
library and is the last branch to cover the County. Regarding the Last Frontier infrastructure, it is the last buildout
for water and sewer for development on the northern end of the County and is needed to build out the commercial
park on Holly Shelter. Once constructed, Cape Fear Public Utility Authority (CFPUA) will work with private
development to build out the delivery and collection systems. Regarding the Robin Hood Road property, the funding
for it is covered under the Mental Health and Substance Use strategy. The boarding school is covered under
Community Building and is funded by the General Fund.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 35
AGENDA REVIEW MEETING, MAY 11, 2023 PAGE 765
Employee compensation:
Pay study implementation: $4.8 million
Cost of living adjustment: 5.5% - considers South Atlantic CPI change from March
2022 to March 2023
Non-County Agency Funding: $1,474,442 versus prior year adopted of $1,496,667
Community Building initiatives: $11.8 million across all funds versus $11.5 million in the
prior year
Includes $1 million for career and technical certification programs
Miscellaneous:
American Rescue Plan Act (ARPA) programs that sunset, absorbed by General Fund:
$1.6 million
CFPUA: $450,000 water/sewer prioritization study
CFPUA: $500,000 initial seed money to fund connections for currently adjacent
property owners
Tourism Development Authority: $250,000 for airline marketing for direct routes
The Healing Place – 50-bed commitment: $1.0 million
Other major funds:
Recycling and Solid Waste total budget: $25.5 million:
$2.3 million capital outlay – primarily for a major piece of equipment rebuild
$8.0 million cell construction/closure
$3.7 million appropriated fund balance
Fire Services total budget - $36.2 million:
$1.5 million capital outlay: fire engine rebuild
$15.5 million capital projects: Castle Hayne and Gordon Road stations
$304,000 appropriated fund balance
Stormwater Services total budget -$4.9 million:
$1.3 million capital outlay: facility renovations and miscellaneous equipment
$311,000 appropriated fund balance
Ms. Daniels responded to questions stating that there are a few pieces of equipment that need to be rebuilt.
Mr. Suleyman explained the benefits of equipment rebuilding. Once a piece of equipment is about five years old,
the options are either the equipment can be replaced or rebuilt. To rebuild a piece of equipment, it is stripped down
and receives all new components, a new serial number, and a new warranty. Rebuilding a piece of equipment is
about 85% of the cost of purchasing a new piece of equipment.
Escrow – Mental Health and Substance Use Fund projections:
Escrow – Revenue Stabilization Fund:
A brief discussion ensued on how the County can show the citizens that they are benefiting from the sale
of the hospital, especially through the interest received from the Revenue Stabilization Fund as it has helped to keep
the tax rate lower. A penny of the tax rate generates about $5 million. Regarding the reduction in funding for
elementary School Resource Officer’s (SROs), several one-time expenses in FY2023 are not required in FY2024. There
is no reduction for SROs for FY2024.
Education – New Hanover County Schools (NHCS):
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 35
AGENDA REVIEW MEETING, MAY 11, 2023 PAGE 766
The recommended capital includes 60% of the incremental increase requested, which is
estimated to be the attainable capacity for the fiscal year
Capital funding for the current year is $4.7 million, so the capital recommendation for FY
2024 is a 128% increase
A brief discussion ensued regarding the New Hanover County Teaching Fellows, about sharing that
information with the citizens, including the investments the County has made in the program and the benefits.
Discussion also ensued regarding school funding. The County is using the number of students provided by NHCS
which is 27,432, at the average daily membership (ADM) rate of $3,434 per student and increased the capital
appropriation. County Manager Coudriet also listed other items the County provides to NHCS that are not included
in the appropriation such as SROs, school nurses, school-based mental health counselors, and maintenance at
various athletic fields. The Board stressed the importance for the County to tell its story when putting out the budget
message. Regarding the number of students and ADM, County Manager Coudriet stated that the NHCS board is open
to a claw back if there are not 27,432 students and there have been discussions about providing more funding if
there are more students.
Education – Cape Fear Community College (CFCC):
New Hanover County also recently purchased a building for CFCC to expand nursing and
other medical professions and committed to funding renovations:
Total expected investment = $26 to $27 million
Next steps:
th
Manager’s recommendation presented and published: May 15
Includes Non-County Agency Funding Committee Recommendation
th
Public Hearing: June 5
Feedback and/or work sessions as directed by Commissioners
thth
Budget adoption: June 5 or June 19
There was a brief discussion regarding escrows. County Manager Coudriet stated that the County received
$350 million at closing for the hospital and there will not be additional cash flows into the County. Another escrow
is about to be released for $75 million, half of it will go to the New Hanover Community Endowment and the other
half will go to the Novant Foundation.
There being no further discussion, Chair Rivenbark thank County Manager Coudriet and Ms. Daniels for the
presentation.
ADJOURNMENT
There being no further business, Chair Rivenbark adjourned the meeting at 4:16 p.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.