As some readers might recall, I was appointed to serve on Chapel Hill’s Sustainable Community Visioning Task Force early last year.

Before we got started there were a few issues to address involving recruitment of a diverse membership to reflect both the concerns of the business community and the community as a whole. After settling on over 20 members, we began to work on a fairly ambitious task – to create a framework for making reasonable decisions on beneficial growth over the next 10 years.

The last few months the SCVTF worked diligently to create a set of principles that will inform our final work product. In the last few weeks, though, concerns about how to address issues raised as long ago as last Spring, once again surfaced.

Four members, Amy Ryan Strange, Del Snow, Madeline Jefferson and myself, submitted the following letter to the committee as a whole this evening outlining not only our concerns but some proposals to more effectively, efficiently and energetically move forward with the task at hand.

Kudos to Amy for doing a fantastic job of word-smithing:

March 8, 2010

Members of the Sustainable Community Visioning Task Force,

When the task force was convened last summer, we were united in one thing: our willingness to commit a significant amount of time and energy to the task of ensuring that the future development of Chapel Hill would proceed in a positive and equitable manner. We all see the importance of providing citizen guidance to town staff, review boards, and local developers for managing the successful growth of our town.

As was made evident at the last meeting, there is a group of task force members who are concerned with the direction our work has taken and feel that our mission is being compromised. We would therefore like to take this opportunity to state our concerns in detail and propose an alternative to the process currently under way.

Our concerns with the current process fall into four specific areas:

1. No opportunity to look at the big picture

By focusing first on individual key areas in town that are likely to develop, we will not be looking at the town as a whole, as we were charged to do, and will not be able to see the cumulative impacts of our recommendations.

Unless we spend many meetings looking at every key area (which the task force seems disinclined to do) and then assessing the cumulative impact of all of them together, under the current plan we will have no way of determining whether our recommendations are reasonable, equitable, or practical for the town as a whole.

2.No specificity

The current Comprehensive Plan does an admirable job of providing general guidance for the development of Chapel Hill, but many of its provisions and recommendations are vague enough that they can be used to justify a broad range of development options, some less desirable than others. The task force’s set of guiding principles, while useful as a general statement of our vision, do not make any progress toward offering more specific, concrete guidelines for the town and local developers.

We agree that it is not the SCVTF’s job to create detailed small area plans, nor do we feel that such exercises are a particularly effective way of guiding real world development. Rather, beginning with the principles’ general vision for the town’s development, it should be the task force’s goal to provide leadership in guiding the town to begin developing specific, context-based guidelines for future development.

3.No acknowledgment of constraints

As the process is currently constituted, there is no mechanism for the task force to acknowledge and plan for factors that will limit the town’s development. The school district has confirmed that we are running out of sites in town for building new schools; the resources of our local watershed are finite; we can add only so many more cars to current roads before quality of life deteriorates; like all communities we have a responsibility to work toward sustainable resource use.

Phil’s “Where Do We Go from Here” memo of 3/9/10 (PDF) states that our charge is “recommending what kinds of growth and where growth can occur if it does occur, not whether growth should occur, or how much or how little.” While none of us are in a position to predict the future, we also can offer no meaningful guidance to growth without accepting and working with at least some general parameters of how much growth is expected, responsible, and desirable. We were charged by Mayor Foy to “challenge all assumptions,” not to work without any assumptions whatsoever.

4. No plan for iterative community input

In our discussions at the beginning of our tenure, the group was strongly in favor of obtaining community input that would provide feedback on our work along the way.

Until Phil’s 3/9 memo, the task force had not been informed of any plans for eliciting community opinion on our recommendations before our report goes to council. If the goal of a May report to council still holds, we question whether there is time for steps 3 and 4 of Phil’s plan to be implemented and incorporated into our report.

For our work to succeed, it must be “owned” not just by us, but by the community as a whole. Adequate time for public input on the guiding principles, hierarchy of trade-offs, and vision for all key development areas is crucial to making this happen.

Given these concerns, we would like to propose modifications to the plan of the task force’s work as we carry forward:

1. Spend one or two meetings on a Reality Check exercise

Given high and low estimates of population changes anticipated in Chapel Hill, along with accepted formulas for calculating expected demand for schools, commercial space, water, etc., it should be possible to form rough estimates of how many square feet of new residential, commercial, and civic space the town will require and can support. The task force could then spend one meeting in small groups deciding how this growth could be logically allocated throughout town; another meeting would allow reconciliation of the groups’ visions into a single task force plan, which town staff could review for conflicts or other problems.

This step would allow us to address big picture issues while avoiding hours of extra meting time looking at each small area in detail in order to build a picture of the cumulative development effects. It would also allow us to work within our development “budget,” accommodating constraints and planning for the town’s future needs. The resulting map would also provide a clear object for testing against the task force’s guiding principles.

2.Conduct character-based small-area development studies of one or two key neighborhoods

Using the information obtained from the Reality Check exercise, the task force could take the development allocated to one or two specific areas and take a close look at how best it could be accommodated.

The product of such a study would be a clear statement of the current neighborhood character, identification of opportunities for development and important elements to preserve, guidance for reconciling expected conflicts and making trade-offs, and specific examples for developers and town staff and boards on what kind of development would be appropriate.

Ideally, this exercise would be a quick example of a more in-depth process that the town would ultimately conduct in each neighborhood in town where significant development is likely to occur.

3.Plan for community input

It is vital to provide enough time for citizens to review and comment on the task force’s work as it progresses. Key elements for review would include (1) our refined list of guiding principles (after we have tested them in one or two small areas); (2) our map showing general allocation of development across the town from the Reality Check exercise; and (3) our recommendations for the select key areas we study.

When the town moved forward to develop in-depth neighborhood plans, it would obviously be crucial to get citizen input about how they see the neighborhood, what is lacking, what development works, and what doesn’t. This information would be the basis for the work of whatever group was charged with carrying this work forward.

While all members of the SCVTF may not have the exact same vision for Chapel Hill, we are united in our concern for the town and its future. It is time for us to be united in framing and agreeing to the process that will carry us forward. At the end of our tenure, we should all agree that we have produced a product that will identify the principles we hold in common, help us preserve what we value and improve what is falling short, and provide useful guidance for the town as it grows and develops. The process we have outlined above can be accomplished efficiently, will produce more useful guidance for the town, and will provide the basis for developing the specific development vision and guidelines the town so urgently needs.

Signed,

Amy Ryan
Del Snow
Madeline Jefferson
Will Raymond

cc: Garrett Davis
Phil Boyle
Mayor Kleinschmidt
SCVTF mailing list

First, spending $8-12M on the Lot #5 project, building luxury condos and enriching a private developer, is not the same as “protecting our Town’s infrastructure”.

The Lot #5 (West 140) project is discretionary – the push to keep it going is not based on sound economic fundamentals.

Putting Lot #5 on par with filling potholes or expanding the Library is a great political speaking point – but certainly not grounded in reality – suggestions otherwise does the public a disservice.

At the same time, other probable debt-related outlays aren’t included in the analysis. Mark suggesting the lump of general obligation (G.O.) debt covers the whole gamut of obligations minimizes the challenge before us.

Beyond that bit of misdirection, Mark knows (or should know) that our Town’s current reserves are low compared to historical reserves on a percentage basis.

That $1.9M increase Mark bandied about sounds big but isn’t considering the $55M hole we’re in. No matter how hard fought the battle to get that $1.9M last year, weighed against future operational and capital demands – like trying to expand the Library – the percentage improvement in overall reserves was slightly better than negligible and doesn’t position us any better to deal with MAJOR outlays (if you use a more reasonable debt ceiling).

To use the credit card example several Council members relied on this evening, there is a qualitative difference between the following two scenarios:

1) Your credit card limit is $10,000 (set in the heady days when the good times rolled). Expecting blue skies everyday, you run up $9000 in debt. You plan to add another $800 ($9800 overall) and set aside $500 to service that debt “just in case”.

2) Your credit card limit is $10,000. You run up $5000 in debt. You set aside $1000 for future payments and plan to take on another $400 for a total obligation of $5400.

Case number one is what Mark is arguing for when he continues to push for the Library expansion, Lot #5, $3.7M in greenway bond debt, etc. (“the whole enchilada”) using the existing debt load as a baseline.

Case number two, which gives the Town much more flexibility in meeting its core needs and is more akin to where we were before the recent massive debt run-up, is what Council members Jim Ward, Laurin Easthom, Matt Czajkowski and Ed Harrison spoke to (in one way or the other).

Council member Gene Pease was right about the wisdom of creating separate budget “silos” for debt and operations. This was something I lobbied for 5-6 years ago and was happy to see implemented.

Yet, as Matt pointed out, Council didn’t discuss the current debt ceiling (and tax rate associated with paying it off) as a maximal point. As history shows, the current ceiling was expediently set based on all the allocated and accumulated debt at that time rather than a careful forward analysis of our residents ability to pay.

It is this kind of thinking that led to the recent big tax increase (which I had predicted 2 years before – based on the “simple math” Mark said I was using this evening).

Part of separating that part of our budget out was to get the kind of visibility we need to “right size” our tax revenue allocations to various core necessities (thanks to Laurin and others for putting it plainly – balancing “needs against wants”).

So, our debt ceiling – which leapt rapidly to handle 2003 to 2009 debt increases – based on extraordinary expenses like the new Town Operations Center – was not set based on a fiscally prudent assessment of our community’s ability to pay (“living within ALL our citizens means”) but on a hunger for stuff which could only be fed by running up our Town’s credit card.

Clearly, our debt load, twice what it was 6-7 years ago and the current debt ceiling are both not sustainable in this economic environment (or with the currently lopsided commercial/residential tax-base). On top of this, we’re also not even close to the reasonable reserve levels we held 5-7 years ago (let alone what we will need to handle predictable jumps – like Lot #5 – to our capital outlays).

As far as future debt not appearing on tonight’s docket, while Laurin and Matt did a good job outlining some probable impacts in the next 3-4 years of capital budgets (like the possibility of repairing/replacing the Police Department) the “elephant in the room” – Lot #5 – once again didn’t get appropriate attention.

When approved, the expectation was that the Lot #5 debt could be paid from parking revenues. The type of debt and method of repayment – certificate of participation (COP), tax incremental funding (TIF, taxing Peter – our local Downtown business folks – to pay for Paul’s profits), paying from parking revenues – remains a bit fuzzy.

If you run the numbers, make a more realistic assessment (I was on the Downtown Parking Task Force and reviewed those numbers carefully) the debt associated with the West 140/Lot #5 taxpayer giveaway will NOT be paid off by the parking revenues (heck, the negative feedback from raising parking rates which will decrease revenues hasn’t been worked out).

Every penny not coming from the variable parking fees revenue has to come from funds earmarked for other purposes – staff raises and benefits for instance. Besides the predictable shortfalls, that revenue variability, in and of itself, is a major concern.

In any case, even if we can make the debt payments out of parking revenues (quite debatable), adding another $8M-$12M of obligations on top of everything else carries its own significant financial impact – including limiting our Town’s ability to borrow for more core needs.

The question isn’t if we’re in a pickle but what is this current Council going to do about it?

I disagree with the suggestion that the Town couldn’t find qualified volunteers to help analyze the budget with fresh eyes and make some reasonable suggestions over the next 4 months.

Given the unique pool of successful local entrepreneurs and talented business folks, professionals from UNC’s Kenan-Flagler institute and business school, CEO/CFO’s living and working here, UNC and other government administrators, former Council members and other concerned citizens with relevant expertise and interest, claiming that we can’t seat a review board now is just a stalling tactic.

The Council did it before and the resulting budget was stronger for it.

Finally, I’m quite disappointed that Mark led the charge to cut-off this valuable source of public input. As Laurin, Jim and Matt argued to various degrees, the budget is the wellspring for everything our citizens want and, more importantly, need. It’s hard to argue any other area needs as much public attention and review as this year’s budget.

The political downside of a citizen review board, of course, is that an independent analysis might upset some folks established agenda, like trying to juggle the discretionary Lot #5 project, expansion of the Library, increased demands on services and responsibilities for maintaining qualified staff.

Here’s the outline I used for my remarks this evening:

5-6 years ago I started asking Council to prepare for some new fiscal realities – flattening revenues and taking on a lot of new bond debt.

Council didn’t move fast enough so I continued to raise the alarm several years ago – participating as a citizen on the Town’s Citizen’s Budget Board.

Every run for Council meeting these coming and existing financial challenges was core to my platform.

What makes this year different?

- Cupboard is bare
- Reserves are still down significantly compared to 3-5 years ago
- Debt-load is historically high, at $55M double what it was 5-6 years ago
- Citizens can’t take on more of a tax burden
- Economic prognosis still very shaky
+ Even though the State – through UNC and UNC health- care – dominant local employers – and other University-related spending has shielded us from some of the worst effects, macro-economic issues – like local sales tax decline, county/state/federal budget problems – which shift costs to the Town – can’t be ignored or underestimated.
+ Chapel Hill is not immune to historically high unemployment, foreclosure rates, default rates on personal/commercial debt

- 18-24 months before a substantive turnaround if we’re lucky.

Recommendations:

Expand scope – adopt a 2-3 year planning horizon because of:

+ Multi-million dollar impacts like Library expansion, Carolina North, Lot #5 – if we still do it, transition from pay-go retirement health-care funding, repairing or building new Police department facilities, cost increase due to shipping waste to Durham, etc.

+ Many other projects on horizon – MPO and transit-related Hwy. 54 corridor improvements, Jordan Lake compact, etc. which come with unknown fiscal consequences

+ Other planned and anticipatable budgetary issues all are within that horizon

Must evaluate all probable impacts prioritized by need – for example:

+ “Needs or must dos” – Obligations to current and former staff, shift from pay-go retirement health-care funding

+ Not on the radar – I’ve lobbied for doubling human service related resources to $500K to meet some of the rising tide of needs caused by this terrible economic downturn (NC reduction in mental health facilities, etc.)

Required but not firmed up:

+ Police Department repairs or new facility

+ Anticipate fiscal equity Carolina North
- Required infrastructure improvements, other obligations
- Planned improvements – like connector
- Reserve to be able to take on multi-modal transit opportunities when state/federal dollars become available

Discretionary or “want to dos”:

+ Desired – Library expansion – hopefully next year

+ Unneeded anymore
– Lot #5 riskiest, largest discretionary liability – if you don’t pull the plug on Lot #5
- The cost of borrowing $8-10M, reserve for open-ended environmental fund

Any budget plan must evaluate the costs of our wants and needs tilted towards the worst case.

Public participation

- Citizens Budget Advisory board
+ Fresh perspective from talented and knowledgeable citizens
+ Tap UNC expertise

- Carolina North public advisory process now
+ fiscal equity component – short-term plan

- More public forums on budget to educate folks, increase public input

- Leverage website with better charting of expenses, capital outlays, debt service – including range of options/scenarios/trade-offs

- Don’t sugar coat the financial numbers, present best and worst case scenarios show all impacts planned, anticipatable, probable and possible so we can choose the most prudent path

I chose to speak out on the fiscally imprudent idea that we can “have our cake and eat it too”.

Run this and the following four year’s budget numbers, look at anticipated impacts – funding Town retirees’ health-care, fixing Police Headquarters, meeting our clean water responsibilities under the Lake Jordan compact, the doubling in demand on our social services, etc. – and it becomes clear – we can walk away now from the discretionary Lot #5 project – at little additional cost to the taxpayer – or do the Library expansion next year.

We can’t do both.

Thanks to Ron and crew for somehow squeezing 10 pounds of commentary [MP3] into a 5 pound bag. Amazing!

Jan. 25th the Council considered two projects with major financial impacts – the Library expansion and the problematic Lot #5 private/public development project.

After discussing their options at length, they decided to postpone approval of the Library expansion pending a more thorough review of the Town’s spending priorities during the Town’s normal budget process which, by the way, kicks off Wednesday, Feb. 3rd.

This was a reasonable and prudent course of action given the serious fiscal condition of the Town, the weakened economy, continued expectations of poor revenues and Council’s touted commitment to public participation.

Unfortunately, the Lot #5 project didn’t get the same level of concern.

The Town’s debt has doubled to $55M over the last 5 years. It’s been used to fund necessary and discretionary capital improvements like the construction of the new Aquatics Center – which at about $7M was almost on budget – and the Town Operations Center – which at $52M went roughly $10M over-budget.

Supporters claim the typical household will ONLY pay $40 more a year but that $40 only covers the increased cost of operating the Library and not the cost of discharging the $16M bond debt.

The Town Manager says that as we payoff existing obligations we can issue new bonds without increasing taxes. This might be true through 2011, but as the Town’s finance director pointed out, from 2012 on the construction debt pushes our overall debt very close – maybe even exceeding – the level necessary to keep our Town’s AAA bond rating.

At that point a tax increase is certain.

The Town Manager’s analysis is also rather one dimensional – challenges like the Town’s rapidly growing unfunded retirement obligations – projected to be as much as $56M or replacing Police headquarters – $10M if Council had purchased Dawson Hall – were not considered.

So what about Lot #5? Lot #5 requires 8 to 12M taxpayer dollars and represents the Town’s greatest, riskiest discretionary fiscal liability.

Part of the sales pitch for Lot #5 was the supposed need to stimulate development Downtown.

With Greenbridge nearly built and other Downtown projects on the way it’s clear that we didn’t need a stimulus. In fact, directly across Franklin St. the University at University Square is already putting forward a much more interesting, integrative proposal which better fulfills the goals of the Lot #5 project – and at little cost or risk to our taxpayers.

Given that the cost reductions that allowed RAM Development to lower their gold-plated condo prices haven’t been passed on to the taxpayer, that the number of pre-sold units hasn’t grown in-line with those price reductions, and that the Town still doesn’t know how it plans to borrow that $8 to 12M – now is the time to drop Lot #5.

Three years out – three contract extensions granted – no significant improvement in proposal.

What does this have to do with the Library?

We can have a Library expansion – hopefully starting next year – or we can have Lot #5 – we can’t handle both.

Contact Council – ask them to pull the plug on the Lot #5 project now so that we can take on projects that are more central to Council’s charter.

More information on my website, CitizenWill.org.

WINTER STORM 5 p.m. Jan. 31 Notice
Posted Date: 1/31/2010

Following the weekend snowstorm, normal operations for Town of Chapel Hill services are anticipated tomorrow (Monday, Feb. 1) with the exception of Monday trash collection, which has been rescheduled to Wednesday.

Public works crews will remain busy with snow plowing and de-icing work, necessitating the delay in trash collection. Monday recycling services, provided by Orange County, are canceled. For more information, contact Orange Community Recycling Programs at 919-968-2788.

Although residents finally got to see pavement on many Chapel Hill streets on Sunday, they are cautioned that hazardous driving conditions persist with slick roads. Expect to encounter ice in the morning. As temperatures rise, melting ice and snow may cause runoff that could result in flooding of some streets and low lying areas. Crews over the weekend have focused on primary roads and bus routes. On Monday, they will address secondary streets.

For more information about the Town’s process for Snow and Ice Removal, see here.

Chapel Hill also has an interactive Adverse Weather Map. See here. Residents with questions about snow plowing and anti-icing may call the Public Works Department at 919-969-5100 from 8:30 a.m. to 5 p.m. For emergencies, always call 911.

Chapel Hill Transit buses on Monday will follow their normal routes and schedules, as long as the streets are safe for travel. Bus routes that will be operating on detours are the A, G, N and T. CHT will not be operating on the following streets/areas until further notice:

A – Sevrin, Umstead and North Forest Hills
G – Lakeshore and Booker Creek (these areas will be served with a van shuttle that will connect to regular routes buses at Phillips Middle School)
N – Village Drive
T – Carol Woods and East Chapel Hill High School

All routes will likely experience delays due to road conditions. CHT encourages customers to be extra cautious when boarding and alighting vehicles as many area sidewalks and roadways remain slippery. EZ Rider and Shared Ride services are providing normal service today, however, customers may experience significant delays as road conditions dictate the ability of drivers to maneuver their vehicles on many area side streets and provide door-to-door service

For updates from Chapel Hill Transit, visit its Inclement Weather page at here or call 919-969-4900 and press “1″ for Route and Schedule Information – expect some wait time due to high call volumes. For EZ Rider/Shared Ride Services, call 919-969-5544.

Chapel Hill has a new tool to track road conditions during adverse conditions, like today’s 3 to 6 inches snowfall.

The GIS map showing roads salted, cleared and relevant services is here.

Good to see this finally in place. The Tech Board discussed just such an application of the GIS system about 6 years ago.

Current weather conditions, courtesy of the Weather Underground, are available here.

The Town’s NextBus service, which usually shows current locations of the buses on their routes is available here.

Big caveat, though (from Chapel Hill Transit):

CHT’s NextBus system estimates the next arrivals for buses in real time, based on each vehicle’s location and average speed. But when many vehicles are off-route or significantly delayed, it cannot make accurate arrival predictions. NextBus can, however, tell you if your line is delayed, or the location of the next vehicle.

Longtime readers might recall that was one of the criticisms (beyond the expense, lack of WIFI and rejection of a local vendor) I had of the NextBus system.

Latest updates on the transit system here.

Council member Laurin Easthom pointed out on Monday, once again, “We need to make some real serious decisions about citizens who use our library and don’t pay.” Laurin has been on-top of this issue for some time. She has also been quite clear in her concerns (THE LIBRARY AND THE FREE LUNCH) unlike several of her colleagues.

Laurin is not alone.

Her colleague Penny Rich added “Citizens in Chapel Hill are quite generous, but I think the endless supply of money in our wallets is not there anymore.” (Daily Tar Heel, Jan. 26th, 2010).

New member Gene Pease, who has been a stalwart supporter of the library for many years – raising significant funds as a member and leader of the Friends of the Library president of the Chapel Hill Public Library Foundation [thanks Fred!] to support its mission – said “To have no conversation about this and about how to attack this problem in the operating budget, I think it’s irresponsible to make the decision tonight” (Lauren Hills,NBC17) in justifying the delay.

I’ve watched this issue unfold for several years, called on former Council’s to show some fiscal restraint over the last 4 years so we could accommodate this project. It is clear that given the current economy, a prudent assessment of our Town’s revenue stream, the core fiscal liabilities and obligations we must discharge (which does not include that Lot #5 money pit), the Library expansion must wait.

Of course, that’s my considered opinion which is based on the data at hand, my entrepreneurial experience and a financial philosophy that emphasizes “living within our means”.

Laurin Easthom foresaw these same issues and tried to set several plans in motion to address this unfortunate juncture – the public’s growing desire for a new facility coupled with a bare public cupboard.

Last April, in fact, she directed the Town Manager and staff to come up “with a financial cost sharing plan” to help ameliorate the anticipated rise in operational costs. To date, no plan has emerged from Town Manager Roger Stancil and crew.

A quasi-plan did emerge on Monday from new Mayor Mark Kleinschmidt and Jim Ward – pressure the Orange County Board of Commissioners and, as Jim put it, make adequate library funding a “litmus test the winners are going to pass, period.” in this year’s county-level election cycle.

Given the County budget mess, the incredible pressure to fund the schools, existing debt obligations, new costs and lost revenues, threats are a non-starter. And, as Jim and Mark seemed to have forgotten, when the county commissioners (BOCC) pushed through election districts, Chapel Hill citizen’s leverage was somewhat diluted.

Our leadership must work with the BOCC on adequately funding the library using a more positive approach. Sure, we shouldn’t continue to accept “nice words that … are worth zero” as Jim Ward said of the Commissioners (Greg Childress, Herald-Sun, 01/26/10) but we also can’t expect to get blood from a turnip.

The best approach, I believe, is to jointly identify sources of funds, possible cost savings made possible by collaborating on other issues, to find the money we need for operating the facility.

That said, “absorbing” additional debt alone should push the start date of the expansion off until next year.

The Town Manager is recommending that as the Town retires existing debt we take on new debt by issuing the Library bonds. That might be a sensible approach if our Town wasn’t already burdened by an incredible debt load – historically unprecedented – during such a troubled economic time. The Town needs to retire existing debt, bring our reserves back up and take a small breather before launching into another spending spree.

Like a lot of my remarks, I find myself editing on the fly, so what I managed to get out in less than 3 minutes wasn’t quite what follows but I believe I made the points I needed.

The simple summary?

We can’t do the Lot #5 (140 West) project and the Library expansion together. Lot #5 hasn’t met its goals, the cost/benefit ratio is decidedly out-of-whack, the necessity quite clearly not there anymore.

Further, the Library expansion project needs to be delayed until taxpayers can bear the total cost. Beyond that, we need to request an extension from the North Carolina Local Government Commission to allow issuing bonds beyond the current deadline so when it is fiscally prudent we can move expeditiously.

Finally, public participation, once again, is barely considered.

Tonight’s remarks:

In 2010 you will be making several key budgetary decisions whose impacts will span the next decade – the Lot #5 (West 140) and Library expansion – two examples.

Lot #5 represents the greatest and riskiest fiscal liability going forward that can be safely dispensed with.

Part of the sales pitch made by some on this Council is we needed this project to kick-start development Downtown.

With Greenbridge nearly built, University Square poised for redevelopment, approval of Grove Park – which will displace the affordable Townhouse Apts. on Hillsborough St. with luxury condos – and other Downtown projects on the way it’s clear that we don’t need that supposed stimulus Lot #5 brings anymore.

It’s time to reconsider this troubled project especially given that:

1) the cost reductions that allowed RAM to lower prices haven’t been significantly passed on to the taxpayer,

2) the number of units pre-sold hasn’t grown in-line with price reductions (33 units pre-sold so far, down from the reported 2008 commitment of 35).

3) the open-ended nature of the cost of the environmental cleanup is still being underplayed,

4) the University at University Square has already put forward a much more sound, interesting and integrative proposal (123 West Franklin) for that stretch of Franklin St. than the expensive – at least to the Chapel Hill taxpayer – Lot #5,

5) still up in the air how we will borrow the money – COPs, TIFs, etc. In any case, however we borrow the $9-10M or more it will limit the Town’s ability to prudently respond in funding core needs,

6) and from what I can see in RAM’s recent missive ( RAM Dec. 22nd, 2009 letter [PDF]) no effort has been made to involve the nearby business and residential community in discussing mitigation of the type of construction-related problems that have plagued Greenbridge or even apprise their future neighbors of current developments (let alone present a coherent and consistent story to the local press).

Three years out and no significant improvement in the proposal. Three extensions to the contract granted by Council. Lot #5 should be shelved now so that the Town can take projects that are more central to its charter.

What does this have to do with the Library?

I want to see the Library expanded but now is not the time.

The memos before you [here] paint a fairly rosy picture of the borrowing in terms of adopting new debt but they don’t do a very good job in putting that increased debt in context of our already astonishing – at least by historical Chapel Hill standards – debt load.

Memo #A, in fact, disingenuously characterizes the increase to homeowners using examples of property valuations well below ($200K) the Chapel Hill baseline.

Look at the chart in Memo #A. The rate of increase in the debt load – that rapidly increasing impact on the Town’s flexibility in borrowing – running our debt right up to the debt ceiling for our AAA bond rating – starts in late 2012 and zooms steeply from there.

Of course, besides adding new debt that and anticipated G.O. additions will account for roughly several cents on the current tax rate while the real kicker is the growth in cost of Library operations – which appears to be even more significant.

Worse, the continued structural instability and weakness of our economy gets short shrift.

Now is not the time to take on a large forward liability.

Making a decision based on these figures tonight will be guaranteeing a tax increase or steep cuts or just ignoring basic obligations two years hence.

Here are my suggestions:

1) Shelve Lot #5. We can have a Library expansion – hopefully starting next year – or we can have Lot #5 – we can’t handle both.

2) The Library borrowing should be delayed until prevailing economic conditions show signs of improvement – strengthened sales tax revenues, stable fund markets which will lend money at a more favorable rate – say less than %100 of the 20 year Treasury bond ratio.

3) Have staff prepare a request to NC Local Government Commission to extend Chapel Hill’s time limit for issuing these bonds so the Council and community have adequate time to plan.

4) Use the established public budget process which kicks off next week [2/3/2010 7:00 PM Council Chambers Townhall) to discuss the Library in light of all our Town's needs – competitive staff wages, affordable housing reserve funds, the growing retirement fund deficit (Unfunded Liabilities: Pay As You Go Not Sustainable) among many others.

Last Fall many of many on Council obligingly participated in a special “emergency” meeting to acquire Dawson Hall for police and other key Town services. That urgent need hasn't gone away – the police department's facility still needs attention - why isn't that part of the rosy projections?

Our citizens deserve a diligent evaluation of the cost of the Library expansion and operations within the context of our total budget and foreseeable needs - not wants.

They also deserve to participate - not just get an agenda item 3 days before a decision is scheduled.

5) Finally, postponing tonight will give you the opportunity to carefully consider this proposal in light of all your priorities, give you time to evaluate the rosy picture drawn by these memos against your own understanding of the economy and think about how to engage the community during this weekend's Council retreat.

In addition, it buys needed time for the public to review the current proposal, attend the budget sessions, ask their questions, get their answers and finally weigh in in a thoughtful manner.

Thank you.

[UPDATE: Council Postpones Consideration]

From tonight’s Council flash report:

Consideration of Proceeding with the Library Expansion Project: The Council considered the project schedule and associated costs for expansion of the Chapel Hill Public Library. The Council delayed action and indicated its desire to discuss the expansion costs in greater detail and in the context of the entire Town budget. The Council stated it wants to know what level of funding Orange County will provide toward Library services.

Orange County provides no capital support toward the Town’s Library expenses; this includes all past and present Library construction costs, debt service for same, equipment or special project costs. County support toward Library operating expenses has remained at $250,000 since 1995 and represents 11 percent of this year’s Library operating budget. About 12,000 of the Library’s patrons live in Orange County outside Chapel Hill limits. The number of materials borrowed by these patrons was 386,000 items last year. This represents approximately 40 percent of the Library’s annual circulation.

Thanks Catherine!

From: Roscoe Reeve
Sent: Monday, January 11, 2010 11:03 PM
To: Town Council
Subject: The Magic 25 Number for Shelters

Dear Mayor Mark and Members of the Council,

I have followed your deliberations, this evening, on the 25 cap for shelters in the LUMO and can, perhaps, clear up its origin.

I was a member and Chair of the Chapel Hill Planning Board that created the 25 cap for shelters in the early 1980’s.

The cap was proposed by staff in the process of creation of the LUMO, a very long and complex process of study and meetings. There was never any discussion or rational for the number 25 as a cap appropriate to a shelter. The interest of the Board was to create (as Mark and Sally implied tonight) a number of permitted uses in appropriate zones so that standards would be clear and that long and expensive deliberations, such as the SUP process, would not impede needed public uses (shelter, school, day care, church, etc.). We thought that if things were appropriate in a zone, as determined by Council’s approval of the tables within the LUMO, arbitrary political passion would be discouraged, the famous “crap shoot” referred to tonight. Especially since schools, churches and private charities could ill afford a lengthy approval process governed by the whims of NIMBY. At that time there was a Council member who would not vote for the approval of any development application where the applicant did not meet personally with him, and in some cases the applicant would have to agree to a personal request of the Council member as arranged at that private meeting. And of course we board members were perplexed when totally complying development proposals were still voted down because a neighborhood didn’t want the development and they raised hell with the Council. Silly us.

In other words, we were all for getting basic development permitted uses so that the development process was logical, based on development standards, and could be completed in a time that did not bankrupt the applicant. Silly us.

I hope this in some way provides explanation for the 25 shelter cap. We assumed that shelters bigger than 25 would need to have a SUP. The number 25 itself was not studied or considered.

With warm regards,

roscoe

The Town is responding to my Mount Bolus neighbor’s Oct. 12th petition this evening with a proposal [PDF] to educate folks on how to deter expansion of the deer population.

Unfortunately, rather than expanding on the petition’s intent – to manage deer population in a safe and humane fashion – some on Council immediately responded negatively to the suggestion of urban archery and acted as if it was the sole proposed solution. Though I know urban archery has been safely and successfully used elsewhere I also can understand how it might not fit here. Surely, though, there are more possibilities than outlined in tonight’s staff memo (I wonder why the Town didn’t reach out to UNC and Duke – who is managing deer populations in Duke Forest – for relevant expertise).

I’m also troubled by some of the assertions made in the report, including the implication that populations are increasing due to increased food supplies made available by urban landscaping.

I’ve lived on Mt. Bolus for over a decade and have seen the steps my neighbors have taken to limit access to food (we’ve put an 8′ high fence around our garden, for instance).

In my Mt. Bolus neighborhood, I believe the problem owes more to limiting natural corridors than increased food supply. I also know that this year we’ve observed that the number of deer has nearly doubled from just last year – something that can’t be explained by the simple assertion that folks yards are providing a greater buffet than before.

Tonight’s recommendation?

Based on the limited portions of Town on which an urban hunt could be safely conducted, combined with the issues outlined above, we do not believe that an urban hunt is a viable option for the Town. We recommend that the Council adopt the attached Resolution, which authorizes the Manager to develop an information packet for residents interested in protecting their landscaping and gardens from deer.

I’m hoping that this isn’t considered an endpoint in the process and that Council will hold the public forum recommended by the Sustainability Committee. Ideally, the forum should be held by late Spring to give adequate time to developing a realistic deer population management plan for Fall (further recommendations from the committee here [PDF].

It appears, though, that tonight’s recommendation is seen as an end-point by at least one commercial organization. Every mailbox I passed this afternoon on Mt. Bolus had the following brochure attached:

Deerbusters? I know we aren’t going to invest in an 8 foot high eyesore and I hope my neighbors don’t either….

Lot’s of discussion about Chapel Hill’s deer problem including these posts on the Chapel Hill News (Hunters Take 86 Deer in Duke Forest,Chapel Hill Rejects Deer Hunt) , Chapel Hill Watch (Passing the Buck), WRAL (Chapel Hill Council to consider ways to reduce deer population)

TO: FROM:
SUBJECT: DATE:
MEMORANDUM
Roger L. Stancil, Town Manager
Ray (Butch) Kisiah, Parks and Recreation Director Lance Norris, Public Works Director Bill Webster, Assistant Parks and Recreation Director Brian Curran, Police Chief

Response to Petition for an Urban Deer Hunt in the Mt. Bolus Neighborhood January 11, 2010

PURPOSE

This memorandum provides information on growing urban deer populations. We have included information on deer control techniques used or attempted in other locations throughout the country. We recommend that the Town approach the issue from the perspective of deer management by providing homeowners with information to assist in minimizing damage from over-browsing. The attached Resolution would authorize the Manager to distribute information to the public related to deer management for gardens and landscaping.

BACKGROUND

On March 8, 2009, a petition was received concerning the issue of deer overpopulation in Chapel Hill.

On October 12, 2009 the Council received a petition from the Mt. Bolus neighborhood asking for a controlled hunt to reduce the number of deer.

On October 12, 2009 the Police Department proposed to monitor vehicle deer accident data, design a public awareness campaign for motorists and recommend tips on how residents can keep deer out of their yards. The Council directed the Manager to return with additional information on possible options for controlling and managing deer populations.

On November 23, 2009 the Chapel Hill Sustainability Committee submitted a petition requesting that the Council consider taking steps necessary to institute an urban archery program within the Town.

DISCUSSION

Deer overpopulation is a growing problem in many areas of the United States and other countries. Whitetail deer are a very resilient and adaptive species that can easily adjust to an urban environment. Historically, deer populations were controlled by large predators in conjunction with cyclic food shortages, cold winters and disease. Today rural deer populations are somewhat controlled by managed hunting. Standard hunting seasons do little to control urban deer populations since most hunting is forbidden in urban areas and deer tend to have small ranges.

In urban areas deer frequently feed on gardens and landscape plants. Deer are also involved in a number of automobile accidents each year. A number of communities and researchers have studied this problem and have identified possible solutions, all of which appear to have limited success. We have communicated with N.C. Wildlife Commission staff and have looked at a number of studies and reports from various parts of the country. While our research into the issue is not definitive, we have found that deer populations can be handled in two general ways: management and population control.

Deer Management

Deer management methods would not result in a reduction in the number of animals inside the Town limits. However, they would assist homeowners and motorists by providing information related to living with an overpopulation of deer. We could direct residents to the NC Cooperative Extension Service, which should be able to provide technical assistance on this issue. We could also prepare a packet of information to assist gardeners and homeowners to manage the impact on individual properties.

Plant Selection: Some success may be possible by planting landscape materials that deer do not like to eat. However, our research indicates that even unpalatable plant materials are likely to be eaten in the spring season or in times of low food supplies. We could provide lists of plant materials that may stand a better chance of survival. For illustrative purposes we have attached a list of common landscape plant materials that are both high and low risk for deer.

Landscape and Garden Fencing: Based on our research, fencing seems to be the best method for protecting landscaping, gardens and low fruit trees from deer. Fences must be at least 8 feet tall in order to effectively deter deer. We could provide plans and suggestions for erecting such deer fencing.
Repellants: Commercial repellants can be used to some effect. Repellants, which have smells or tastes that deer do not like, are spread over landscape materials in the hope that deer will avoid them. While somewhat effective the main issues are:

Repellents do nothing to reduce populations of deer. Products may have to be changed over time. Repeated use becomes expensive. In times of low food supply deer will eat treated landscaping.

- Repellents do nothing to reduce populations of deer.
- Products may have to be changed over time.
- Repeated use becomes expensive.
- In times of low food supply deer will eat treated landscaping.

We could provide information related to use of repellents in any packet of information provided to the public and include such information on our web site.

Population Control

The goal of population control would be to reduce the number of animals inside the Town limits through some method such as hunting, euthanasia, removal or fertility control. Population control appears to work best in isolated areas such as on islands or in areas that are separated from rural areas by large urban environments. Population control does not work as well in areas with a ready source of replacement animals. Population control methods in an environment such as Chapel Hill would likely require an ongoing commitment, perhaps annually, to be effective because any reduced population would be replaced by new animals that could easily move in from the surrounding rural areas. We have found references to the following methods for controlling deer populations.

Urban Hunting Season: It appears that urban hunts are the most effective and least costly method of population control in areas where such a hunt could be conducted safely. The N.C. Wildlife Resources Commission recommends the use of urban hunts to maintain deer populations at acceptable levels. An urban archery season has been an option in North Carolina for at least 2 years. The N.C. Wildlife Resources Commission manages the program for use by municipalities. It is now too late to participate in the 2010 season, which runs from January 9 to February 13, as the application deadline was April 1, 2009. If the N.C. Wildlife Commission continues the program we could apply for the 2011 season.

An urban hunt would technically be possible in several parts of the Town. However, because of population density, the number of areas in which a hunt could be safely conducted is severely limited. We suggest that the Council consider several issues before deciding to hold an urban hunt in the Town. These issues include:
• The hunt would have to be carefully managed to ensure safety of nearby residents and users of the properties.
• The boundaries of the hunt would have to be clearly defined, signed and patrolled to prevent use during the hunt period.
• The Town is fairly densely developed and populated compared to most cities that use urban hunts in North Carolina. For safety reasons any such hunt would have to be limited to larger tracts of land inside the Town. Since most of these larger tracts are publicly owned parks, greenways and open space areas, the management program would have to contain a plan and process to keep users off those tracts during the hunt. We would have to close tracts of land and limit access to them. We know from experience that attempting to keep recreational users off of trails and out of parks during times of maintenance and repair can be very problematic.
• It is not unusual for deer shot by arrows to run a significant distance before dying. It is likely that some wounded deer would manage to leave the managed hunt areas. Part of the management plan would have to include a plan for gaining permission to track and kill wounded animals on private properties.
• To be effective the hunts would have to be large enough to kill a significant number of animals in a select area.
• To be effective the hunt would have to be repeated on a regular basis because the harvested deer could be replaced by new born fawns. In addition, animals from outside the hunt area could migrate into the post-hunt area to take advantage of the decreased competition for food.

In response to the October 12 and November 23, 2009 petitions, we looked specifically at the potential of a controlled hunt in the Mt. Bolus neighborhood. We believe that there are only three areas in the neighborhood with large enough undeveloped tracts to safely conduct a bow hunt. Two of those areas are privately owned. The third area, which is owned by the Town, is located along Bolin Creek and contains a portion of the Bolin Creek Trail. A limited hunt might be successful if the private landowners would agree to allow their properties to be used. Without cooperation from these landowners only a very limited hunt would be possible on Town property. Such limitations would likely have little effect on the deer population. Additionally, it should be noted that the Bolin Creek Trail would have to be closed during any such hunt on the Town parcel.

Another option would be to follow the recommendations of the Sustainability Committee, which recommend that the Town apply to the NC Wildlife Resources Commission for an Urban Archery Hunt, study the Pittsboro Urban Archery Program to determine its applicability to some neighborhoods in Chapel Hill, and hold a public forum about the growing deer population within the town. See the attached Sustainability Committee recommendations.

Capture and Relocation: With this method deer would be captured and moved to some another area. Issues associated with this method include:

• The N.C. Wildlife Commission currently does not approve of this method. • Capture methods may be complicated. Methods noted in various documents include
box/wire traps, capture pens, rocket propelled capture nets, drop nets, and anesthesia darts.
• The cost would be high. The City of Springfield, Missouri studied this option in 2007 and estimated the cost to be $300-400 per deer. Some methods such as box or wire traps have reported costs approaching $1,000 per animal.
• Research indicates that many animals die from stress from the capture and transportation process.
Capture and Euthanasia: With this method deer would be captured and then euthanized. This would result in removal of deer without the danger of hunting or the fear of wounded animals moving onto private properties. Properties would not have to be closed to the public. Depending on the method of euthanasia the meat would likely be useable. Issues related to this method include:
• As with the Capture and Release method discussed above, this method would likely have a high cost per animal removed.
• To be effective a relatively large number of animals would have to be captured and killed in a select area.
• The method would have to be repeated on a regular basis, perhaps annually, because the harvested deer would be replaced by new deer moving in from other areas.
• This method would require a detailed proposal presented to the N.C. Wildlife Resource Commission. Based on discussions with the Commission’s staff, this would be a highly uncommon request.

Sterilization: Currently deer contraceptive or sterilization measures are strictly in the experimental stages and have not been approved for use in North Carolina. According to N.C. Wildlife Commission staff any fertility control initiatives must first be approved at the federal level before they can be approved by the N.C. Wildlife Commission. In general, the research we have seen indicates that all potential methods of sterilization have the same common problems:

• All methods are expensive and potentially cost prohibitive. • Results are unreliable, especially in non-isolated populations such as is found in Chapel Hill.
• Sterilization would have to be repeated on a regular basis, perhaps annually, to be effective in a non-isolated environment such as Chapel Hill. Eventually unsterilized animals would move into the former range of deer that were sterilized, requiring a continuing program.
• Any effective method must be aimed solely at females since males are polygamous. A small number of fertile males could impregnate a very large number of fertile females.
• A positive effect on vegetation would take at least several years since sterilized deer would continue to eat once released. Deer typically live for 3 to 4 years, with some individuals living much longer.
• To have a practical effect the number of sterilized animals would have to be large. Four methods of fertility control have been tested and may be applicable to urban deer:
1. Surgical sterilization is the only method that would be permanent, but it appears to impractical for a number of reasons including:
• Each animal would have to be captured, undergo surgery, undergo a recovery period, and then be released. As noted above, surgery would have to focus solely on females to have any real effect. Female sterilization is a more involved and expensive operation than male sterilization.
• There is some indication that a significant number of animals may die from stress.
2. Synthetic steroid hormones have been used experimentally. It appears to be impractical because it would require daily oral exposure. Deer would have to be prominently tagged to prevent human consumption.
3. Immunocontraception involves the use of a vaccine to stimulate antibodies to proteins required for reproduction. This works only if the drugs are administered in the spring and
6
summer prior to breeding season. Numerous issues have been identified with this method including the difficulty of getting deer to eat the drugs and drug induced extension of the active breeding and birthing cycle.
4. Contragestation is accomplished by introducing a drug into the food supply in the winter when animals are more likely to eat unfamiliar food. The drugs result in an abortion of the fetus. This approach might eventually be the easiest to administer. Some aborted fetuses noted in the studies were very late term, which might result in citizen complaints when late term fetuses are found in wooded areas.
According to a February 25, 2008 article in the Greensboro News-Record, officials on Bald Head Island are working with university researchers to see if they can use contraceptives to limit the deer population. The research will cost the village more than $60,000 over two years. Sterilization may work on Bald Head Island because it is a closed population with very little opportunity for unsterilized animals to migrate into the study area. Sterilization appears to be an ineffective option for urban areas similar to Chapel Hill because unsterilized deer from surrounding areas will simply replace sterilized animals as the opportunity arises.

If the Town were to consider a sterilization program we would likely have to hire a consultant to develop a proposal for federal approval and subsequent approval by the N.C. Wildlife Commission. We believe the costs associated with development and management of the program would be significant while the chances of success appear to be low.

FISCAL NOTE

There would be minimal fiscal impacts if the Council decides to approach this issue from the standpoint of developing an educational campaign. However, we anticipate significant costs if a population control method is selected.

RECOMMENDATIONS

Chapel Hill Sustainability Committee Recommendations: On November 23, 2009 the Committee submitted a petition requesting that the Council consider taking steps necessary to institute an urban archery program within the Town. Specifically, the petition requested that:

• The Town seek permission from the NC Wildlife Resources Commission to organize an Urban Archery Program to safely cull the deer population within Chapel Hill. The Committee wants this early authorization so that in the event that the Town decides to go forward with such a program; there will not be undue delay in implementing it.

• The Town staff study the Pittsboro Urban Archery Program to determine its applicability to some neighborhoods in Chapel Hill where the deer population has significantly grown in recent years, and identify those areas where an urban archery program would be appropriate and most effective.

• The Council hold a public forum about the growing deer population within the town which reviews that public health and other hazards of this problem and presents various options for dealing with this problem. Invite someone from the NC Wildlife Resources Commission, at least one person from another community that has been running an operation to cull deer populations, and a representative from the NC Bowhunters Association to participate as forum presenters.

• The Town staff develop an Urban Archery program that meets Chapel Hill conditions, invite public comment, amend it as appropriate, and forward it to the Council for action.

Staff Recommendation: Based on the limited portions of Town on which an urban hunt could be safely conducted, combined with the issues outlined above, we do not believe that an urban hunt is a viable option for the Town. We recommend that the Council adopt the attached Resolution, which authorizes the Manager to develop an information packet for residents interested in protecting their landscaping and gardens from deer.

ATTACHMENTS
1. March 8, 2009 Petition (p. 9).
2. October 12, 2009 Petition (p. 10).
3. November 23, 2009 Chapel Hill Sustainability Committee Petition (p. 33).
4. List of Plants More Likely to Survive Deer Overpopulation (p. 35).
5. Map of Mt. Bolus Neighborhood Showing Potential Hunt Sites (p. 43).

As you might expect, I have a few questions about the survey, including the cost, why it was done by an out-of-state company, how it was constructed, who it was targeted at initially (online version coming soon), how the data will be analyzed and how transparent the process will be among others.

Don Evans, over on Chapel Hill Watch has already started a thread discussing the survey here (“Survey Says” ).

Here’s the scanned in survey if you’re curious about the questions:

ChapelHillSurvey2009.PDF (4M)
Chapel Hill Cover Page
Chapel Hill Survey Page 1
Chapel Hill Survey Page 2
Chapel Hill Survey Page 3
Chapel Hill Survey Page 4
Chapel Hill Survey Page 5
Chapel Hill Survey Page 6
Chapel Hill Survey Page 7

That vacancy will be discussed and probably filled at tonight’s special Council meeting.

Over the last 8 years I’ve served this community mainly as a citizen activist and volunteer. Over the last 4 years I ran 3 times for Council in order to serve our community more effectively.

Though I’ve only garnered 5,000+ votes the 3 times I ran, I still felt that those citizens supporting my platform deserved to have a fair airing of their issues and a call for those issues to be addressed by whomever the Council decides to seat.

This election year was marked by polarization of candidates into two clear aggregates (as it appears from Xan Gregg’s excellent analysis), neither of which I was a member.

I was a truly independent candidate raising a different set of issues, addressing a broader range of concerns and bringing a long history of taking on some of the least popular and toughest problems our community faced.

Even though I lost, I do believe I ran the best campaign to-date. I gave my honest appraisal of where the Town is, I didn’t dodge any questions and I always answered as fully and thoughtfully as practical.

The following is a youTube playlist of the presentations made by: Will Raymond, Donna Bell, Aaron Shah, Matt Pohlman, H. Brock Page, Joe Capowski and Jason Baker.

The Town’s video is posted here but is restricted to those platforms supporting Microsoft’s proprietary Silverlight spyware-laden technology.

Tonight’s big agenda item, “What to do about the waste transfer station?”

New County Manager Frank Clifton’s extensively reviewed the three proposed options: use the County’s Payfadar property (originally slated for a park) on Millhouse Road, pursue the ill-suited (and ever more expensive) Howell property on Hwy. 54 or “punt” (as Barry Jacobs put it) and temporarily ship our County’s waste to the existing Durham County facility (“Plan B”).

After an excellent set of balanced community presentations from Preserve Rural Orange County (PRO), Orange County Voice and the Rogers Road Coalition (CEER) – many of which covered not just the problems with the proposed sites but posited responsible alternatives – the Board voted 6-1 to not only use “Plan B” but to permanently take the Millhouse-Eubanks-Rogers Road community off the table.

Mal de M.E.R. no more.

I’ve been involved in one way or another on this issue for 5 years. Really pushed to get, and had some success, in creating a transparent community-based process for siting the transfer facility. Proposed using “Plan B” a couple years ago (here and here) to give the Board and community sufficient time to explore a wide range of alternatives.

And, as of this evening, seen the great work from a wide spectrum of County citizens, the thoughtful consideration of our Commissioners finally come to fruition in this decision.

Of course, the work is far from over. I believe that we must eventually managed our waste locally (for instance, like my 2006 suggestion to create an eco-industrial center on the Eno River Economic Development zone to sort, reuse and minimize the waste stream). I also believe that Chapel Hill must step up and bear a greater responsibility in dealing with our contribution to that waste stream. I also believe we must coordinate with our neighboring communities to create an environmentally responsible end-point for our waste.

That work has yet to begin.

This graph isn’t only a call-to-arms for Chapel Hill but is reflective of why health care reform is critically needed NOW.

If the Town decides to change its plan in response to the OPEB criteria, the escalating cost of health-care and the inherent risk that at some point Chapel Hill’s taxpayers can no long sustainably “pay as you go”, we still must make sure that the end-result is a comprehensive, competitive, yet fiscally prudent, benefits package to continue to attract and retain topnotch staff.

Tonight was the final Council meeting before the election.

I’ve attended every Council meeting this Fall except the special Friday morning one. I go to quite a few Council meetings in general, so attending this Fall’s during my run for office was not much of a stretch. Penny Rich and Augustus Cho usually show up to catch what’s going on directly (Augustus was there this evening, Penny was participating in UNC Healthcare’s Tickled Pink event to benefit cancer research). Watching the meeting on TV or via the Web is just not quite the same.

Over the last eight years it has been interesting to see which candidates do show up – it seems like you would want to make sure you really want the job given the time commitment, to get up to speed on the relevant issues so you can hit the ground running, to learn a bit more of the nuts-n-bolts of how the Council operates so you can fit into the process fairly quickly – yet cycle after cycle it’s only a few that show.

While the media will probably focus on the Kidzu presentation, the approval moving Glen Lennox’s neighborhood conservation district (NCD) forward, Jim – on election eve – asking the Town to enforce Northside’s NCD (which I talk about in my recent brochure) or Council letting their next incarnation decide on Strom’s replacement, probably the most consequential issue on tonight’s agenda will not get word one.

Ken Pennoyer, the Town’s director of business management, was proposing a change in the structure of staff benefits. All new employees hired after June 30th, 2010 would get a defined benefit plan covering retirement health coverage. Existing employees would retain their Town guaranteed benefit, the payout based on term of service and retirement age.

What’s the big deal?

The existing plan, which is a “pay as you go” approach paid out of general revenues, has increased from $400K to $891k in 5 years – more than doubling our current obligation. To fully fund our commitment to our retired workforce would take $32M to $56M, roughly $3+ M or more per year, for a couple decades!

While the Town has set aside $400K in designated funds over the last two years, the forward obligation makes those contributions pale in comparison. $3-4M per year is equivalent to $0.05 to $0.07 of Chapel Hill’s tax rate – an additional $150 to $210 per year on a $300K home tax bill. This unfunded liability is just one of a number of other obligations – like the $3M affordable housing maintenance fund – which has been allowed to grow and grow over the last 6 years.

Tonight is the first attempt to truly grapple with that overhanging debt to our valued retirees. There are risks inherent in moving new employees to a defined benefit plan but the alternative, scrambling to find funds each fiscal cycle to adequately maintain that obligation, is not sustainable.

As the staff report points out, new regulations (OPEB) require the Town’s accounting to take into account this forward liability. This is one difference (of a few) between governmental and business budgets – and one reason why ones acumen in business doesn’t necessarily translate into success in managing a town budget. After working the Town’s numbers six years, applying my business experience, I well understand that difference.

Here’s the crux of the problem, as laid out by Ken Pennoyer:

New accounting rules for Other Post Employment Benefits (OPEB), effective for the fiscal year beginning July 1, 2008, required the Town to acknowledge health care and life insurance benefits that will be provided to current and future retirees, in a manner similar to a pension obligation. The future cost obligation is, in effect, a liability that the Town will need to address. To the extent that we can provide funding to address the liability, we will reduce the impact of the rise in the annual cost of benefits., We also have the opportunity to make changes to the benefits structure to reduce the growth of the liability. These new accounting rules, also known as Government Accounting Standards Board Statement 45 (GASB 45), have significantly changed the Town’s financial statements as we account for and report the liability for the future cost of providing these benefits. Based on the most recent actuarial study the Town’s current unfunded liability, discounted at 4%, is $32.4 million. In order to fully fund this liability on an actuarially sound basis the Town would need to make an annual required contribution (ARC) of $3.0 million.

As a member of Council, this is the type of problem I will be able to more effectively tackle, and tackle in a timely fashion.

While Julie did a great job of moving the event along unfortunately the “skip to” feature of this version of the Flash Player doesn’t allow one to move to a later point in the video. The video will start playing and as material is buffered you will be able to move forward.