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053122 Budget meeting schools May 31, 2022 Special Meeting-Budget Presentation The Randolph County Board of Commissioners met at 6:00 p.m. for a special budget session in the 1909 Randolph County Historic Courthouse Meeting Room, 145 Worth Street, Asheboro, NC. Chairman Darrell Frye, Vice-Chairman David Allen, and Commissioners Kenny Kidd, Maxton McDowell, and Hope Haywood were present. Also present were County Manager Hal Johnson, Assistant County Manager/Finance Officer Will Massie, Deputy Clerk Sarah Pack, and Clerk to the Board Dana Crisco. The meeting was livestreamed on Facebook and YouTube. Chairman Frye welcomed attendees and explained the purpose of the meeting. Manager’s Proposed Budget County Manager Hal Johnson said, in accordance with North Carolina law, the County Manager and County Finance Officer are required to present to the Board of County Commissioners, and the citizens of Randolph County, a proposed balanced budget for the next fiscal year, 2022-2023. The law requires that the budget ordinance be adopted by July 1, 2022. This meeting is also the beginning of a process that will lead to adoption of a final budget after review, public hearing, and consideration by the County Commissioners. The total proposed budget is $154,592,290. The budget is balanced. It maintains services at necessary levels to address the most urgent needs of the county. The proposed budget is financially sustainable. No increase in property tax is recommended in the proposed budget. The proposed budget retains the 2019 revenue neutral tax rate of 63.27 cents per $100 valuation. In addition to the introduction to the proposed Fiscal Year (FY) 2022/23 County Budget, there will be presentations from Asheboro City Schools, Randolph County Schools, and Randolph th Community College. On June 9, budget presentations will be heard from County Departments, th and on Monday, June 13, Fire Department presentations and requests from Community Agencies th will be considered. June 13, beginning after 6:30 p.m., is also the time of Public Hearing th concerning the proposed budget. Final Budget Adoption is scheduled for Monday, June 20. Mr. Johnson said no Board of County Commissioners, in the history of Randolph County, has had to address as many critical issues as this Board of Commissioners has faced over the past 6 years. There have been multiple capital improvement projects to enhance education and county services, emergency services facility and staffing expansions to enhance our capabilities, renovations to courthouse facilities, law enforcement needs and the expansion/renovation of the Detention Center, the expanding needs of Public Health and Social Services, employee turnover and retention issues, training and recruitment of professional staff, economic development challenges in addition to the planning and development issues involving the Greensboro-Randolph Megasite, the bankruptcy of Randolph Health and its continued operations due to County commitment to funding support through the Rural Health Stabilization funds, public health and economic impacts of the COVID-19 pandemic, and challenges presented as a result of the opioid/Fentanyl addiction crisis. 5/31/22 Mr. Johnson said this was his eighth budget as County Manager. Every budget has brought its special challenges. Last year, during the budgeting process, there were concerns with the continuing negative effects of the pandemic. The expectations were that there would be a significant economic negative impact from the pandemic. The federal stimulus boosted the local economy leading to an increase in sales tax. As a result, the County budget remained strong beyond negative assumptions due to the pandemic. The budgetary challenges this year are to again anticipate uncertainty in the economy. Those uncertainties still exist in this proposed budget. Challenges of the current tight labor market, rising inflation, and expected higher interest rates are trends that may impact economic growth. Every year the County receives a sales tax revenue forecast from the Fiscal Research Division of the North Carolina General Assembly. For this upcoming fiscal year, they are assuming a 2.7% sales tax growth statewide. This is substantially down from the current year of 12.6%. While County leadership is mindful of the current uncertain economic conditions, and the proposed budget allows us to plan for any eventuality, it is believed that the future success of the Megasite with Toyota Battery Manufacturing along with major expansions in some of the existing industries can lead to future transformative growth in Randolph County. Funding Priorities Retention of current employees and Randolph County’s ability to recruit in a challenging job market is a priority and critical for our ability to provide services to our citizens. The priority for this year’s budget is a 5% cost of living and market adjustments to the employee compensation plan. Many businesses and governments have increased employee compensation this past year and Randolph County does not want to fall behind in our ability to recruit and maintain a workforce. Finally, the proposed budget increases funding for the merit program so that Department Heads can truly reward those employees that have consistently stepped up during these challenging times. The amount of funds available for merit has not changed since 2017. This has resulted in fewer recognitions at the same time that we are asking more of our employees. New Positions (July 1, 2022) During the budget process, Department Heads will update the Board on their operations and pressures they are facing. 33 new positions have been requested by County Department Heads. No new positions were possible in the Proposed Budget with the lower sales tax revenue forecast. If anticipated sales tax revenue is increased to 5%, the following 13 positions are recommended for approval in the July 1, 2022, budget: Administration: Reporting Specialist HR Administrative Assistant (Recruiting) Emergency Services: 4 Assistant 911 Shift Supervisors Juvenile Day Reporting: 2 Processing Assistants Social Services: 1 Income Maintenance Caseworker 2 Visitation Monitors Child Support Services: 2 Lead Specialist 5/31/22 Public Library: To be determined Reclassifications Reclassifications for several positions would be included to address current job requirements and standards. Additional Positions to be Considered by January 2023 (depending on Budget status) Public Buildings: Maintenance Technician Emergency Services: 4 Telecommunicators 1 Deputy Director Juvenile Day Reporting: Supervisor Social Services: Paralegal Veterans Services: Veterans Services Technician (Part-Time) Capital Outlay Departmental Capital Outlay requests have been recommended in the proposed budget that are part of the normal replacement schedule. This includes routine replacement of Sheriff’s Office vehicles, ambulances, and other County vehicles. The Budget allows for the funding of all capital outlay requests with the exception of 2 additional ambulances requested by Emergency Services. Schools The two public school systems (Asheboro City Schools and Randolph County Schools) requested a 4.2% total increase in current expense. However, this increase is not included in the proposed budget at this time. Total average daily membership (ADM) is projected to decline. The ratio of ADM between Randolph County Schools (RCS) and the Asheboro City Schools (ACS) has shifted which results in more Current Expense and Capital Funding apportioned to Randolph County schools. Randolph Community College (RCC) has requested a 7.02 % increase in current expense. This is not included in the proposed budget. An annual portion of the Article 46 sales tax distribution totaling $500,000 will be transferred to RCC Capital Projects. Randolph Health The $12 million Rural Healthcare Stabilization Loan will provide funding to improve Randolph Health (Hospital) capital and equipment needs. Debt service for this $12 million loan to be repaid by the County beginning in FY 23 in the amount of $1,120,000 is included in the proposed budget. Community Organizations Several outside community organizations have requested increases to their appropriations. Ash-Rand Rescue applied for an additional $34,000 for part-time staff. This has been included in the proposed budget. All other outside organizations funding has been maintained at existing levels in the proposed budget. Strategic Planning 5/31/22 Since 2017, the Board of Commissioners have approved one-time strategic planning community grants of $2,924,330. These grants have strengthened 31 organizations and programs impacting the health, safety, and well-being, from all areas of Randolph County. These funds are made possible due to the annual Landfill Lease Distribution received from our landfill operator, Waste Management. Mr. Johnson said that Assistant County Manager/Finance Officer Will Massie, would present a more detailed review of County revenue and expenditures as proposed in the 2022/23 Budget. FY 2022-2023 Proposed Budget Will Massie, Assistant County Manager/Finance Officer, presented a review of County revenues and expenditures in the Proposed FY 2022-23 Budget. The priority for this Budget includes the Employee Pay Plan Adjustment. Thirty-three new positions were requested, but none are included in the budget. Thirteen positions are recommended for approval. Essential department vehicle funding is also a budgetary priority. The property tax base is a combination of real and personal property. This Budget maintains the revenue neutral rate of 63.27 cents per $100 valuation. The collection rate is 99%. One cent on the tax rate provides $1,229,085. Mr. Massie discussed recent countywide property valuation and changes between fiscal years since 2014, and revenue trends from county Department of Motor Vehicle distributions. Mr. Massie explained the FY 21-22 sales tax collections. The County is currently collecting more than budgeted, but the collection percentage has dropped. There will be an estimated 2.7% growth in regular tax collections in FY 22-23. There is an estimated $4,330,000 for Medicaid Hold Harmless. Article 46 tax is dedicated to capital reserve and RCC. In the proposed budget, taxes account for of total revenues. Unfunded departmental requests include 33 positions and six existing position reclassifications. The operation of the Ramseur Library is included as well, with two full-time and two part-time positions included. Mr. Massie compared ADM of the RCS and ACS school systems and gave a brief overview of funding requests, current expenses, current capital, and construction capital. Education accounts for 23.5% of the total budget. There is over $17 million allotted for debt service this fiscal year. Mr. Massie described the pay schedule for the Rural Health Stabilization Loan over the next 12 years. The Public School Building Capital Fund includes lottery payments that have not changed. Schools are requesting their tax rates stay the same. Climax and Farm Fire Departments are requesting an increase in fire district tax rates. Mr. Massie explained other annual funds to consider in the budget. There are various capital projects in different stages of completion. There is no new dept being considered this fiscal year. Mr. Massie showed distributions of landfill lease revenues and where the funding goes. There is 5/31/22 currently over $1.3 million estimated in the FY 22-23 Well-Being Reserve. There are some pending applications for strategic funds, including Lydia’s Place and the Children’s Home Society. Vice-Chairman Allen asked what the State sales tax average. Mr. Massie said typically the County is at a similar rate to the State. Asheboro City Schools Presentation Dr. Aaron Woody, Asheboro City Schools (ACS) Superintendent, thanked Commissioners for their leadership and presented budget requests for Asheboro City Schools. He recognized several Board of Education members and Administrators in attendance. Dr. Woody gave a brief update on current events in the school system, including graduation ceremonies, summer learning, and other summer programs. Asheboro City Schools requested $300,000 for the Continuation Budget for expected increases in retirement and health insurance as well as for salary increases. Total current expense funding of $6,644,403 is included in this request. Dr. Woody asked the Board to continue supporting the tax rate of 14.39 cents for the Asheboro City Schools Supplemental Tax District. This County appropriation request represents an increase of $300,000 to cover the continuation budget items over the FY21-22 appropriation. Dr. Woody gave an overview of Year 8 of the 10 Year Capital Improvement Plan and requested total capital outlay of $1,086,929. This request includes an increase of $100,000 over the funding provided for the FY 21-22 school year. He also gave a brief update on the Asheboro High School renovation and showed photographs of the progress. Dr. Woody thanked the Board for their continued support. Randolph County Schools Presentation Dr. Stephen Gainey, Randolph County Schools (RCS) Superintendent, introduced several staff members and administrators in attendance and presented the Randolph County Schools budget request. Dr. Gainey said RCS is requesting continuation costs of $828,000 which include increases for insurances, retirement, salaries, charter school growth, and utilities. Capital outlay requests in the amount of $100,000 cover increased costs in the “9-Year Facility Upgrade/Repair Plan.” The total of all items is $928,000. This is the smallest request in nine years. Commissioner McDowell asked how many students attend charter schools outside of the county and Dr. Gainey answered that there were 201 students attending out-of-county brick and mortar schools. Randolph Community College 5/31/22 Daffie Garris, Vice President for Administrative Services for Randolph Community College (RCC), introduced members of the college leadership team in attendance. She thanked the Board for their support. Chairman Frye asked if RCC would have an interim president. Ms. Garris said yes. Ms. Garris detailed several ceremonies held on campus that had previously been suspended due to the COVID-19 pandemic. A substantial amount of restricted federal funding was disbursed as student aid during this time. A new HVAC system has been purchased in the amount of $850,000. Continuation costs are high. An increase of $221,000 has been requested for current operating costs. Employee retention is vital. RCC has adopted a living wage of $15 which has affected the pay scale for all employees. This caused a significant increase in salary costs. Health care and retirement benefits are also expensive; there have been substantial cost increases in the last few years. Maintenance and housekeeping supplies, as well as fuel, have increased in cost. The requested increase is modest and is truly needed. This has been an extremely difficult budget year. She thanked the Board for their support and continued funding. Chairman Frye said workforce development realignment is a looming challenge. The County is working with RCC to address this issue. Chairman Frye identified Department Heads present in the audience, including Human Resources Director Jill Williams, Social Services Director Tracie Murphy, Public Health Director Tara Aker, and Public Library Director Ross Holt, and commended them for their participation in tonight’s budget process. Adjournment At 7:33 p.m., on motion of Allen, seconded by Haywood, the Board voted 5-0 to adjourn. ________________________________ ______________________________ Darrell Frye, Chairman David Allen _________________________________ ________________________________ Kenny Kidd Maxton McDowell _________________________________ ________________________________ Hope Haywood Sarah Pack, Deputy Clerk to the Board 5/31/22