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YEAH.GOOD EVENING OR GOOD AFTERNOON, AND WELCOME TO THE JUNE 25TH, 2024 BOARD OF ALDERMAN WORK SESSION.
UM, I ASK ALDERMAN ROYAL, IT'S NOT ONLY AGENDA, BUT I THINK IT'S ALWAYS A GOOD IDEA.
IF YOU DON'T MIND OPENING US UP IN A WORD OF PRAYER, PLEASE.
MAYOR, THANK YOU FATHER IN JESUS' NAME.
WE THANK YOU FOR THIS OPPORTUNITY AGAIN TO DISCUSS CITY BUSINESS AGAIN, TO LOOK AT ALL POSSIBILITIES THAT WE CAN ENHANCE THE QUALITY OF LIFE OUR CITIZENS.
WE THANK YOU FOR YOUR GUIDANCE.
WE THANK YOU FOR YOUR WISDOM, AND WE THANK YOU FOR INNOVATIVE CREATIVE IDEAS, GOD, THAT WE CAN MOVE OUR CITY FORWARD.
WE ASK THIS IN JESUS' NAME, AMEN.
IF YOU'RE ABLE TO STAND, PLEASE DO SO.
WE PLEASURE OUR COUNTRY, OUR PLEASURE OF THE UNITED STATES OF AMERICA, AND INTERIOR REPUBLIC FOR WHICH IT STANDS, ONE NATION UNDER GOD, INDIVIDUAL WITH LIBERTY AND JUSTICE FOR.
OKAY, THEN WE TAKE OFF ALL IN TIME.
HOW ABOUT A ROLL? HOW ABOUT A ROLL CALL? LET'S DO THAT ONE.
I BELIEVE, UH, BOTH ALDERMAN BEST AND BRISSON ARE IN ROUTE, AND WE'LL BE HERE MOMENTARILY.
[1. Discussion of Bond Referendum.]
THIS OVER TO MR. HUGE.AT THIS TIME, I'D LIKE TO ASK KIM OTRO, WE IN INTRODUCE OUR GUEST AND WE'LL START THIS PRESENTATION.
I WOULD INTRODUCE YOU VICE PRESIDENT.
I WOULD LIKE, UM, TO INTRODUCE COLE, OUR SENIOR, SENIOR VICE PRESIDENT WITH DAVEN FINANCE AND JOHN, JOHN ON OUR REVENUE BOND THAT WAS ISSUED LAST FALL.
AND THEY'RE HERE TODAY TO PROVIDE AN OVERVIEW OF THE GENERAL OBLIGATION FOR THE GEO BOND REFERENDUM PROCESS.
DISCUSS DAVENPORT'S ANALYSIS OF THE CITY'S DEATH CAPACITY VERSUS THAT AFFORDABILITY REVIEW, THE BOND REFERENDUM CALENDAR AND ANSWER QUESTION MAY ASK.
UH, AGAIN, I'M TED COLE WITH DAVENPORT AND JOHN MAAS IS HERE AS WELL AS, AS KIM INTRODUCED.
UM, I'M GONNA TALK PRIMARILY ABOUT FINANCE RELATED MATTERS, UH, JOHN, ABOUT LEGAL RELATED MATTERS, BUT WE DO TEND TO DABBLE IN EACH OTHER'S PROFESSIONS A LITTLE BIT, BUT I'LL DEFER TO HIM WHEREVER, UH, A LEGAL QUESTION COMES UP.
AND WE VERY MUCH WOULD LIKE TO KEEP THIS, UM, CONVERSATIONAL.
SO IF YOU HAVE ANY QUESTIONS ALONG THE WAY, PLEASE STOP US.
UM, THERE IS MATERIAL IN FRONT OF YOU, AND I BELIEVE IT MIGHT BE WHAT'S ON THE SCREEN.
AND THERE ARE PAGE NUMBERS IN THE BOTTOM RIGHT CORNER OF A PRINTED MATERIAL.
UM, YEAH, SO AS, AS, UH, AS KIM SAID, WE'RE GOING TO TALK ABOUT A GENERAL OBLIGATION BOND REFERENDUM, BUT WE'RE ALSO GONNA SHARE SOME OTHER, UM, INFORMATION RELATED TO OTHER TYPES OF DEBT.
UM, AND WE'RE GONNA TALK ABOUT, AS SHE ALLUDED TO, THE, THE CITY'S DEBT CAPACITY.
THAT IS YOUR ABILITY TO TAKE ON DEBT WITHIN CERTAIN MEASURES OR POLICIES OR BENCHMARKS.
AND WE'RE ALSO GONNA TALK ABOUT DEBT AFFORDABILITY.
THAT IS, HOW DO YOU REPAY THE DEBT SERVICE THAT'S DUE? THEY'RE RELATED CONCEPTS, BUT THEY DON'T ALWAYS LINE UP.
IN OTHER WORDS, MANY LOCAL GOVERNMENTS HAVE AMPLE DEBT CAPACITY.
THEY CAN TAKE ON DEBT AND STILL HAVE A VERY SOLID FINANCIAL PROFILE AND LOOK VERY CREDIT WORTHY, BUT IT DOESN'T NECESSARILY MEAN THAT THEY HAVE THE MONEY IN THEIR BUDGET TO REPAY THAT DEBT.
SO, DEBT CAPACITY VERSUS DEBT AFFORDABILITY.
AND WE'RE GONNA TALK ABOUT THE PROCESS FOR A GEO BOND REFERENDUM, AND TECHNICALLY BY THE LAW, AND I'M GOING TO JUST VERY HIGH LEVEL, YOU DON'T REALLY NEED TO START THAT PROCESS TILL NEXT SPRING.
THERE'S CERTAIN THINGS YOU HAVE TO DO BY STATUTE THAT, FOR THE MOST PART, KICK OFF IN THE APRIL MAY OF 2025 TIMEFRAME FOR
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A FALL OF 25 VOTE.BUT THERE ARE A NUMBER OF THINGS THAT YOU MIGHT CONSIDER GETTING STARTED WITH EARLIER AS YOU DISCUSS THINGS INTERNALLY AS, AS A BOARD AND, AND AS A COMMUNITY ABOUT WHAT ARE THE GOALS OF THE REFERENDUM.
THERE'S SOME VERY SPECIFIC CATEGORIZATIONS OF PROJECTS AND QUESTIONS THAT YOU WOULD ULTIMATELY PUT TO THE VOTERS THAT JOHN CAN SPEAK ABOUT.
THERE'S A, UM, UM, A VERY DEFINED PROCESS WITH THE LOCAL GOVERNMENT COMMISSION IN RALEIGH WHEN YOU DO WANT TO PROCEED WITH A BOND REFERENDUM THAT WE HAVE TO FOLLOW.
SO THERE IS OFTEN A LOT OF PLANNING WORK THAT GOES INTO THE PROCESS.
WELL, BEFORE THE FIRST LEGAL REQUIREMENT HITS, AGAIN, THAT WOULD BE SOMEWHERE IN THE APRIL, MAY OF 2025 TIMEFRAME.
IF YOU GO TO PAGE, UH, THIS SAYS PAGE FIVE.
ANYHOW, UM, IT'S PAGE THREE IN THE BOOK.
I'M NOT SURE HOW THAT, LEMME JUST MAKE SURE I, OH, YOU GOT A COUPLE OF INTRO SLIDES.
UM, ANYHOW, UH, IF YOU'RE LOOKING AT THE HARD COPY, BOTTOM RIGHT SAYS THREE, BUT ON THE SCREEN IT SAYS FIVE.
ANYHOW, UM, JUST WANTED TO INTRODUCE ALL THE DIFFERENT WAYS THAT YOU MIGHT FUND CAPITAL PROJECTS.
UM, CLEARLY YOU COULD JUST SPEND CASH, RIGHT? YOU HAVE RESERVES, YOU HAVE CURRENT YEAR REVENUE, AND YOU WANNA SPEND IT ON, UH, CAPITAL PROJECTS.
UM, THAT'S A VERY STRAIGHTFORWARD WAY OF DOING IT.
UM, WHAT WE'RE HERE TO TALK ABOUT TODAY IS A GENERAL OBLIGATION BOND THAT DOES REQUIRE A VOTER REFERENDUM.
AND AS WE SAID, IT REQUIRES YOU TO TAKE A NUMBER OF LEGAL STEPS AHEAD OF THE VOTE, AND IT REQUIRES YOU TO DEVELOP, UH, BOND QUESTIONS THAT WILL GO ON THE BALLOT THAT ARE PRETTY SPECIFIC ABOUT THE PURPOSE AND THE NATURE OF WHAT YOU WANT THE VOTERS TO CONSIDER.
UM, THE, IF IT'S APPROVED, UM, YOU WILL BE ISSUING THAT DEBT AND IT'LL BE BACKED BY YOUR FULL FAITH AND CREDIT AND YOUR TAXING AUTHORITY.
AND, AND IT'S REALLY THE BEST CREDIT THAT ANY LOCAL GOVERNMENT CAN GIVE TO AN INVESTOR OR A BOND HOLDER BECAUSE YOU'RE LEGALLY REQUIRED TO RAISE TAXES IF YOU DON'T HAVE THE REVENUE TO REPAY THE DEBT.
SO IT'S A VERY, VERY, UM, COST EFFECTIVE AND EFFICIENT WAY TO FUND PROJECTS.
THE OTHER NUANCE ABOUT IT IS YOU'RE NOT REQUIRED TO PLEDGE ANY REAL PROPERTY COLLATERAL FOR THE LOAN, RIGHT? NON VOTED DEBT, WHICH YOU'VE DONE BEFORE, INSTALLMENT FINANCING, THINGS LIKE THAT.
YOU MIGHT PUT A MORTGAGE ON A FACILITY AS THE SECURITY FOR THE BOND HOLDER, BUT IT'S NOT BACKED BY YOUR FULL FAITH AND CREDIT.
IN OTHER WORDS, YOU DON'T HAVE TO VOTE THAT TYPE OF DEBT WITH A GO BOND, YOU DON'T HAVE TO GIVE ANY REAL PROPERTY COLLATERAL.
THE SECURITY THAT THE BOND HOLDER HAS IS YOUR TAXING AUTHORITY, OR FULL FAITH AND CREDIT IS WHAT WE CALL IT.
UM, WHEN A BOND ISSUE IS TAKEN TO THE VOTERS, AND IF IT'S APPROVED, UM, YOU HAVE SEVEN YEARS TO ISSUE THAT DEBT.
YOU'RE NOT REQUIRED TO ISSUE THE DEBT, BUT YOU HAVE SEVEN YEARS TO ISSUE THE DEBT.
AND OFTENTIMES YOU CAN GET A THREE YEAR EXTENSION.
IF YOU NEED MORE THAN SEVEN YEARS TO ISSUE THE DEBT, YOU WOULD GO TO THE LOCAL GOVERNMENT COMMISSION FOR A THREE YEAR EXTENSION.
BUT FROM A PLANNING PERSPECTIVE, YOU SHOULD BE THINKING ABOUT IT AS WE GO TO THE VOTERS.
IF IT'S APPROVED, WE'VE GOT SEVEN YEARS TO ISSUE THE DEBT.
AND YOU DON'T HAVE TO ISSUE IT ALL AT ONCE.
YOU CAN ISSUE IT IN PIECES AS YOUR PROJECTS ARE READY TO GO.
UM, THE OTHER IMPORTANT PART OF THAT IS IF THE VOTERS SAY NO, IF THEY DON'T APPROVE THE REFERENDUM, THEN YOU KNOW, YOU WILL HAVE SOME LIMITATIONS ABOUT IF YOU CAN EVEN MOVE FORWARD WITH THOSE PROJECTS AND WIN, BECAUSE YOU'LL HAVE TO GO TO THE LOCAL GOVERNMENT COMMISSION.
OBVIOUSLY, YOU'LL HAVE TO DEAL WITH THE COMMUNITY.
AND SO I THINK YOU NEED TO BE CAREFUL AS YOU DO THE WORK ABOUT WHAT ARE WE GONNA ASK THE VOTERS TO APPROVE? UH, WHAT IF THEY WERE TO SAY NO? WHAT DOES THAT DO TO OUR CAPITAL PLAN? WHAT DOES THAT DO TO THAT PARTICULAR PROJECT OR THAT TYPE OF PROJECT? IF THEY SAY NO, DO WE STILL NEED TO PURSUE IT? AND THAT COULD CREATE CHALLENGES AT A LOT OF DIFFERENT LEVELS.
UM, AGAIN, IF THE REFERENDUM WERE, UM, WERE TO FAIL, AND THAT TAKES US TO A COUPLE OF OTHER TYPES OF FINANCING.
UH, THE INSTALLMENT FINANCING THAT I TALKED ABOUT THAT IS NOT VOTER APPROVED.
YOU HAVE TO HOLD A PUBLIC HEARING.
YOU ALL HAVE TO ADOPT A COUPLE OF RESOLUTIONS.
YOU HAVE TO GO TO THE LOCAL GOVERNMENT COMMISSION.
UM, AND OFTENTIMES IT'S SECURED BY AN ASSET, A BUILDING, A PIECE OF PROPERTY, A VEHICLE, UH, EQUIPMENT, WHAT HAVE YOU.
SO YOU'VE GOT, UM, A, A VERY GOOD FINANCING OPTION THAT DOESN'T REQUIRE VOTER
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APPROVAL FOR CERTAIN PROJECTS.IF YOU DETERMINE THAT, YOU KNOW, YOU, YOU WANT TO PURSUE FINANCING THE PROJECT, UH, WITHOUT GOING TO REFERENDUM, THAT INSTALLMENT FINANCING SOMETIMES CAN BE DIFFICULT, PARTICULARLY IF YOU'RE DOING PROJECTS LIKE STREETS AND SIDEWALKS OR PARKS AND REC GREENWAY TYPE ACTIVITIES THAT MAYBE DON'T LEND THEMSELVES TO REALLY GOOD COLLATERAL.
THEY'RE NOT A BUILDING OR A PIECE OF EQUIPMENT.
THEY'RE, THEY'RE A, A PUBLIC STREET OR A SIDEWALK OR A, A GREENWAY TRAIL.
AND SOMETIMES IF YOU'RE GOING TO ISSUE DEBT FOR THAT TYPE OF PROJECT, THAT MORE NEBULOUS COLLATERAL CAN BE DIFFICULT TO GET A LENDER FOR BECAUSE IT'S, YOU KNOW, IT'S, IT'S JUST NOT DISCREET.
IT'S NOT A BUILDING OR A PIECE OF EQUIPMENT.
SO EACH OF THESE FINANCING OPTIONS HAS PROS AND CONS AND DIFFERENT CHALLENGES DEPENDING ON WHAT YOU'RE FUNDING.
UM, REVENUE BONDS, AS KIM MENTIONED, YOU ALL HAVE ISSUED REVENUE BONDS BEFORE, MOSTLY RELATED TO WATER, SEWER, ELECTRIC.
YOU'RE PLEDGING REVENUES OF THAT SYSTEM, NO REFERENDUM REQUIRED.
AND THEN THERE'S A, UH, ANOTHER NOT OFTEN USED, UM, BUT, BUT WE DO SEE IT FROM TIME TO TIME CALLED A SPECIAL OBLIGATION BOND.
THAT'S MIGHT BE WHERE YOU ISSUE BONDS FOR A CERTAIN PROJECT.
AND WHAT YOU'RE GOING TO SECURE THAT LOAN WITH IS A PLEDGE OF A NON-TAX REVENUE OF THE CITY.
SO, FOR EXAMPLE, YOU MIGHT GET SALES TAX DISTRIBUTIONS FROM THE STATE OR THE COUNTY.
THAT'S NOT YOUR TAX, THAT'S THEIR TAX, BUT YOU GET THE REVENUE, YOU CAN PLEDGE THAT REVENUE AGAINST A SPECIAL OBLIGATION.
SO THERE ARE A WHOLE HOST OF, OF FUNDING TYPES AND METHODS.
GEO IS WHAT WE'RE GONNA FOCUS ON TODAY, BUT YOU MIGHT EVOLVE AS YOU'RE THINKING ABOUT ALL THE THINGS YOU WANT TO DO.
WHAT PROJECTS DO WE WANT TO INCLUDE IN THE REFERENDUM? WHAT PROJECTS DON'T WE, AND THAT MIGHT BE BASED UPON THE, THE, THE NECESSITY OF THE PROJECT.
WE GOTTA DO IT NO MATTER WHAT.
OR IT MIGHT BE BASED ON THE TYPE OF PROJECT.
AND DOES IT LEND ITSELF TO FINANCING THROUGH SOME OTHER METHOD? YES.
WHAT WOULD BE THE MAXIMUM OF THE MINIMUM OF PROJECTS THAT YOU CAN ADD TO THIS? TWO OR THREE OR JUST ONE? I I DON'T FOR A, FOR A REFERENDUM, YES.
UM, IT CAN BE ANY NUMBER OF PROJECTS.
IT CAN BE ONE, IT CAN BE MANY, AND MANY COULD BE OVER 10 OR 20.
I DON'T THINK THERE'S ANY LIMIT.
WHAT YOU WILL SEE, AND, AND MAYBE JOHN CAN JUMP IN HERE AS WELL, IS WHEN IT, YOU DEVELOP YOUR PLAN, YOU HAVE TO SELECT CERTAIN CATEGORIES OF WHAT YOU CALL THOSE BONDS.
SO THERE'S STREETS AND SIDEWALKS AS A CATEGORY, PARKS AND REC.
UM, PUBLIC SAFETY MIGHT BE A CATEGORY.
SO YOU, YOU, YOU CAN'T JUST SAY, WE WANT TO VOTE A BOND TO COVER A BUNCH OF THINGS.
OKAY? AND THAT'S, YOU CAN, YOU CAN KEEP THE QUESTION TO THE VOTERS ON THE BALLOT VERY BROAD WITHIN THAT PURPOSE.
STREETS AND SIDEWALKS, ANYTHING IN THE CITY, STREET SIDEWALKS, WHEREVER.
OR YOU COULD BE VERY SPECIFIC MAIN STREET.
AND WE'LL TALK A LITTLE BIT ABOUT, YOU KNOW, THE PROS AND CONS OF GETTING VERY SPECIFIC IN THE, IN THE REFERENDUM QUESTION VERSUS, UM, MORE BROADLY WRITTEN QUESTION.
PAGE FOUR IN YOUR BOOK, PAGE SIX ON THE SCREEN, A LITTLE BIT OF A, UH, ADDITIONAL OVERVIEW.
UM, SOME OF THIS I HAVE ALREADY COVERED, UM, CITYWIDE ELECTION, OBVIOUSLY.
SO I THINK WHAT WE'RE TALKING ABOUT IS, UH, OCTOBER, OCTOBER OF 25 WOULD BE THE NEXT OPPORTUNITY HERE.
UM, WE TALKED ABOUT STATING THE PURPOSE, UH, THE MAXIMUM AMOUNT FOR THE PURPOSE.
YOU'LL, YOU'LL HAVE TO ESTABLISH THAT ULTIMATELY IN THE BOND QUESTION AND INDIFFERENT PUBLIC HEARINGS AND RESOLUTIONS THAT YOU'LL ULTIMATELY CONSIDER, UM, ACTION ON IN THE FUTURE.
SO SPECIFIC AMOUNTS, UM, AND AS I SAID, SPECIFIC PURPOSES.
AND THEN, AND WE MENTIONED A FEW OF THOSE THAT I'VE ALREADY TALKED ABOUT HERE.
PARKS AND REC, STREETS AND SIDEWALKS, FOR EXAMPLE.
UM, YOU CANNOT COMBINE MULTIPLE PURPOSES.
UM, I THINK SOME OF THIS IS PRETTY SELF-EXPLANATORY THAT WE JUST TALKED ABOUT SEVEN YEARS.
IF THE VOTE IS APPROVED, YOU HAVE SEVEN YEARS TO ISSUE IT.
UM, IF THERE HAPPEN TO BE TWO OR
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THREE BOND QUESTIONS ON THE REFERENDUM, SO YOU'VE GOT A STREETS AND SIDEWALKS AND A PARK AND WRECK, UH, ONE CAN PASS AND ONE, YOU KNOW, THEY STAND ON THEIR OWN.THEY, THEY ARE VOTED ON INDIVIDUALLY.
SO, UM, YOU KNOW, EACH OF THOSE WILL BE VOTED AND TALLIED AND, AND, UM, YOU'LL MOVE FORWARD ACCORDINGLY.
UM, I GUESS THE LAST THING I WOULD SAY HERE IS, UM, AS A BOARD, UM, YOU CAN SPEND MONEY AND TIME IN PUBLIC EDUCATION ABOUT A REFERENDUM.
I THINK I'LL SAY, HOPEFULLY SAY THIS, RIGHT? BUT NOT IN ADVOCATION FOR OR AGAINST THE, THE BONDS, RIGHT?
SO, SO I HAVE A QUESTION FOR YOU ON THAT.
I DID NOT REALIZE THAT THE CITY COULD ONLY DO THIS AT THE TIME WE'RE HAVING OUR ELECTION, SO I APPRECIATE THAT INFORMATION.
BUT THE SECOND PIECE IS, CAN A CANDIDATE EXPEND THEIR CAMPAIGN FUNDS TO PROMOTE THE BOND REFERENDUM? OR IS THAT A QUESTION FOR ANOTHER ATTORNEY? THAT'S PROBABLY QUESTION FOR
WHAT WE FREQUENTLY TELL YOU, WHAT YOU F SEE IS LAID DOWN, THE TOWN CAN, OKAY? AND YOU ALL AS CITIZENS CAN GO OUT AND SPEAK IN FAVOR OF THIS CITIZEN.
IT'S JUST YOU WOULDN'T HAVE AN OFFICIAL, COULD YOU COME TO THE SPEAKER, PLEASE? I, I CAN'T HEAR YOU.
UH, THE QUESTION WAS COULD YOU USE CAMPAIGN FUNDS, PERSONAL CAMPAIGN FUNDS TO, IN, TO ADVOCATE FOR IT? AND I, I DON'T KNOW THE ANSWER TO THAT.
I KNOW THERE'S NO AN UNDER THE BOND LAW, IT DOESN'T ADDRESS THAT.
THAT'D BE A CAMPAIGN FINANCE QUESTION, BUT YOU FREQUENTLY SEE LOCAL CHAMBERS PUT TOGETHER CAMPAIGNS FUNDED KINDA OUTSIDE OF THE TOWNS CALVER TO SUPPORT, TO ENGAGE FOLKS TO COME OUT FOR THE ELECTION.
SO THERE IS A, A LINE AT WHICH, UM, PUBLIC FUNDS BEING USED FOR EDUCATION VERSUS ADVOCACY.
UM, IF YOU TURN TO PAGE FIVE, UM, YOU'LL SEE THAT THERE HAS BEEN OVER THE LAST COUPLE OF YEARS AT THE STATE LEVEL, UH, UM, AN INITIATIVE TO PUT, I GUESS I'D CALL IT MORE TRANSPARENCY TO BOND QUESTIONS, MORE INFORMATION FOR VOTERS TO HAVE AT THEIR DISPOSAL WHEN MAKING A DECISION AND SORT OF LEFT AND RIGHT.
UH, WHAT WE'LL CALL THE PREVIOUS, UH, BALLOT QUESTION WAS SHORT AND SWEET.
UH, THAT'S HOW IT HAD BEEN DONE FOR MANY, MANY YEARS.
BUT UNDER NEW LEGISLATION, THERE IS MORE INFORMATION REQUIRED TO BE ON THE BALLOT.
AND THERE'S ALSO SOME ADDITIONAL STEPS THAT HAVE TO BE TAKEN, UM, EARLY ON IN THE PROCESS, AS I SAID, DEALING WITH THE LOCAL GOVERNMENT COMMISSION, NONE OF WHICH IS TERRIBLY DIFFICULT.
WE HAVE TO DO CERTAIN CALCULATIONS FOR WHAT THE INTEREST EXPENSE WILL BE OVER THE TERM OF THE DEBT IF IT WERE TO BE ISSUED.
WE HAVE TO MAKE VERY CLEAR WHAT OUR ASSUMPTIONS WERE IN MAKING THOSE ESTIMATES.
IN OTHER WORDS, WAS IT A 20 YEAR TERM? WHAT INTEREST RATE DID WE USE? JUST MORE INFORMATION ABOUT, UM, THE BOND AND THE IMPACT ON THE CITY'S BUDGET, THE IMPACT ON A PROPERTY OWNER.
SO THEY HAVE MORE INFORMATION AT THEIR DISPOSAL WHEN MAKING A DECISION ABOUT AND QUESTION.
AND THAT PLAYS A GREAT ROLE AS WELL AS UPON THE LENDER, WHAT THE INTEREST RATE IS GONNA BE FOR US.
CORRECT? AND, AND THE LOCAL GOVERNMENT COMMISSION HAS PROVIDED GUIDANCE ON, UM, WHAT THEY CALL THE SAFE HARBOR ASSUMPTIONS.
MEANING IF YOU USE THESE ASSUMPTIONS FOR INTEREST RATE, FOR EXAMPLE, UM, THE LOCAL GOVERNMENT COMMISSION WILL FIND THAT YOUR PROCESS MET THEIR STANDARDS.
UM, AND, AND THEY TAKE THE, THE HIGHEST INTEREST RATE FOR A NORTH CAROLINA GENERAL OBLIGATION LOCAL GOVERNMENT BOND, I THINK IN THE LAST 20 YEARS, IT'S AROUND 5.3%.
SO THEIR GUIDANCE TO US IS WHEN YOU'RE RUNNING ANALYSES FOR YOUR CLIENTS ABOUT A REFERENDUM AND THE DEBT SERVICE ON A REFERENDUM AND HOW IT FITS IN THEIR BUDGET, IF YOU USE THESE ASSUMPTIONS FOR INTEREST RATES, UM, WE, THE LGC WILL BE ABLE TO PUT THIS FORWARD TO THE COMMISSION ITSELF AS HAVING MET THE SAFE HARBOR REQUIREMENTS.
UM, IT USED TO BE THAT YOU SUBMIT AN APPLICATION TO THE LOCAL GOVERNMENT COMMISSION TO HAVE A REFERENDUM, AND THEY ACCEPT IT AND APPROVED IT, OFTENTIMES, IF NOT ALWAYS, BEFORE THE REFERENDUM EVEN TOOK PLACE.
SO LIKE IN SEPTEMBER OR OCTOBER WITH A REFERENDUM IN NOVEMBER, SUBMITTED THE APPLICATION, THEY APPROVED IT, AND THEN THEY WAITED TO SEE WHAT THE REFERENDUM, NOW THE COMMISSION WAITS TO DO THEIR APPROVAL UNTIL AFTER THE VOTE, SO THAT THEY'RE NOT VIEWED AS HAVING ENDORSED
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IT IN SOME WAY.SO YOU HAVE A, A VOTE OF THE P YOU SUBMIT YOUR APPLICATION IN SEPTEMBER, OCTOBER, OR EVEN EARLIER.
THEY HOLD IT, THEY ACKNOWLEDGE THEY RECEIVED IT, YOU HAVE THE VOTE, AND THEN THE COMMISSION CONSIDERS APPROVAL OF YOUR BONDS.
AND IN ORDER TO NOT HAVE A MISSTEP WITH THE VOTERS APPROVING IT AND THE COMMISSION HAVING TROUBLE, THEY SUGGEST THAT YOU FOLLOW THOSE SAFE HARBOR GUIDELINES.
AND, AND WE WOULD WALK YOU THROUGH ALL OF THAT WHEN THE TIME COMES OURSELVES AND, AND JOHN AND HIS COLLEAGUES TO MAKE SURE THAT WE'RE DOING EVERYTHING IN ACCORDANCE WITH THESE NEWER STATUTES.
AND WE, WE DON'T FIND WHEN IT DOES ARRIVE TO THE LOCAL GOVERNMENT COMMISSION ON THEIR AGENDA, THAT WE HAVE A MISCOMMUNICATION ABOUT WHAT WAS SHARED WITH THE VOTERS VERSUS WHAT THE COMMISSION IS SEEN OR WANTS TO SEE.
ARE WE MANDATED BY THE NORTH CAROLINA SESSION LAW? I I AM ASSUMING THAT WITH THESE, WITH THE AVERAGE VOTER, THESE SAMPLE BALLOT QUESTIONS ARE NOT READER FRIENDLY, ARE, DO WE HAVE THE ABILITY TO PARAPHRASE OR WE HAVE TO USE THESE VERBATIM, VERBATIM, UH, THE STATUTE.
UH, THERE, THERE'S ROOM FOR SLIGHT MODIFICATION, BUT THE STATUTE'S PRETTY CLEAR THAT YOU HAVE TO USE THIS FORM.
SO, UM, WHAT YOU CAN DO IN VOTER EDUCATION IS MAYBE, YOU KNOW, THAT'S WHERE A LOT OF ELECTED BODIES OR MUNICIPALITIES AND COUNTIES TRY TO EDUCATE VOTERS, BUT THE BALLOT QUESTION IS PRESCRIBED BY THE STATUTE.
UM, THERE IS A MORE DETAILED CALENDAR IN THE BACK OF THE BOOK, BUT THIS HITS SOME OF THE HIGHLIGHTS.
AND YOU'LL NOTICE THAT WE'RE STARTING IN THE FALL OF 24.
THIS IS REALLY KICKING THAT OFF.
I THINK, I KNOW YOU ALL HAVE DISCUSSED THIS OVER THE LAST SEVERAL WEEKS, BUT, UM, THE, THE BOND AMOUNTS, THE PROJECTS, THE QUESTIONS BEING ANALYZED AND REFINED.
I KIND OF SEE THIS AS MAYBE THE KICKOFF EDUCATING YOU ALL ABOUT THE PROCESS AND GOING THROUGH THE FALL, EVEN INTO THE WINTER AND EARLY SPRING, YOU ALL DEVELOPING A PLAN FOR THE REFERENDUM.
AND AGAIN, IT'S WHAT ARE THE QUESTIONS THAT WE'RE GONNA WANT TO PUT TO THE VOTERS? HOW MUCH IS INCLUDED IN EACH AMOUNT? UM, AND WHATEVER DETAIL YOU FEEL YOU WANT TO SHARE WITH THE COMMUNITY ABOUT WHAT THOSE PROJECTS MIGHT BE THAT WOULD BE FUNDED, UM, IF THE VOTE, IF THE BONDS WERE APPROVED.
SO WE ARE, WE'RE SORT OF DEVELOPING THAT PLAN OF FINANCE, UM, OVER THE NEXT SEVERAL MONTHS, SO THAT BY THE TIME YOU GET TO MAY OF 2025, YOU'RE READY TO GO AND, AND EXECUTE THE REQUIRED LEGAL STEPS OF THE REFERENDUM.
AND, AND YOU'LL SEE THEY REALLY START OFF IN AROUND MAY OF 25, FINALIZING THE QUESTIONS AND THE AMOUNTS.
THEN THERE'S A SERIES OF LEGAL FILINGS, UM, UM, UH, PUBLIC HEARING, I BELIEVE THAT'S CORRECT.
UM, SUBMITTING THE APPLICATION TO THE LOCAL GOVERNMENT COMMISSION, GETTING EVERYTHING OVER TO THE, UH, BOARD OF ELECTIONS AND ALL OF THAT BY CERTAIN DEADLINES.
AND ULTIMATELY, UM, IN THIS CASE, I GUESS IT WOULD BE OCTOBER 14TH, 2025 WOULD BE WHEN THE VOTE WOULD TAKE PLACE.
UM, IF IT'S APPROVED, THE INITIAL AUTHORIZATION OF SEVEN YEARS WOULD START THEN, AND IT WOULD BE, IT WOULD EXPIRE IN 2032, UNLESS YOU GOT A THREE YEAR EXTENSION, WHICH AGAIN, THE LOCAL GOVERNMENT COMMISSION, WE'VE SEEN IT, THEY, THEY USUALLY AWARD THOSE EXTENSIONS PRETTY FREELY, BUT IT'S NOT GUARANTEED.
SO YOU HAVE SEVEN YEARS TO ISSUE FOLLOWING THE VOTE, AND THEN YOU CAN REQUEST AN EXTENSION VOTE.
UM, THAT'S KIND OF ALL HIGH LEVEL, NOT NECESSARILY NEW BRUIN SPECIFIC.
ANY QUESTIONS ON THAT BEFORE WE GET INTO SOME OF THE DISCUSSION ABOUT YOUR DEBT PROFILE AND SOME BEGINNING DISCUSSIONS REGARD REGARDING DEBT CAPACITY AND DEBT AFFORDABILITY? OKAY, SO WE'RE GONNA GO TO PAGE 10.
UM, THE CITY IS NOT CURRENTLY RATED.
YOU DON'T CARRY A BOND RATING.
THAT IS NOT A INDICATIVE OF NOT BEING CREDIT WORTHY.
I THINK YOU'RE VERY CREDIT WORTHY.
IT'S BECAUSE YOU DON'T HAVE ANY BONDS OUTSTANDING THAT CARRY A BOND RATING.
YOU HAVE IN THE PAST, UH, YOU HAD BONDS THAT WERE RATED, UH, A THREE AT THE TIME.
THOSE BONDS MATURED, THEY GOT PAID
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OFF AT THEIR FINAL MATURITY, AND THAT WA RATING WAS WITHDRAWN.AND AGAIN, THAT'S NOT AN ACTION THAT INDICATES A, A PROBLEM WITH YOUR CREDIT, IT'S JUST THAT THE BONDS WERE NO LONGER OUTSTANDING.
AND THAT'S WHAT THE RATING AGENCY RATE IS A BOND, NOT JUST A BROAD RATING ON A CITY OR A COUNTY.
SO YOU'RE IN, YOU'RE GOING INTO THIS WITHOUT A BOND RATING.
IF THE REFERENDUM IS APPROVED, YOU MAY DETERMINE THAT YOU WANT TO ESTABLISH THE BOND RATING WHEN YOU'RE READY TO ISSUE THE FIRST PIECE OF DEBT.
THE FIRST, THE FIRST GENERAL OBLIGATION, UM, BECAUSE YOU'RE NOT RATED, YOU HAVE A LITTLE FLEXIBILITY WITH, WE MIGHT FIND THAT ISSUING THE GEO BOND TO A BANK WITHOUT A RATING MAKES SENSE.
YOU HAVE SOME LATITUDE TO DO THAT.
BUT OFTENTIMES WE SEE IT WITH A COMMUNITY THAT DOESN'T HAVE A BOND RATING.
IF THEY HAVE A REFERENDUM, IF IT'S APPROVED AND THEY'RE READY TO GO TO THE MARKET WITH THEIR FIRST BORROWING, THEY WOULD, THEY WOULD ESTABLISH THEIR BOND RATING.
AND THAT, THAT ALL FITS WITHIN A FINANCING TIMETABLE FROM THE MOMENT YOU ALL SAY, IF IT'S APPROVED, WE'RE READY TO GET STARTED.
WE WANT TO BORROW $5 MILLION OR $10 MILLION.
UH, IT'S ABOUT A 90 DAY PROCESS TO ISSUE THE DEBT AND THE RATING WOULD BE ESTABLISHED IN THAT 90 DAY PROCESS.
WOULD THAT RATING AFFECT THE, UH, PROCESS OF THE, UM, THE, THE INTEREST RATE ON THAT? THAT'S, THAT'S REALLY THE, THE BIGGEST, UM, IMPACT THAT THE RATING WOULD HAVE IS WHEN WE GO TO THE MARKET WHERE WE'RE RATED WILL, UM, IMPACT, UM, THE INTEREST RATE.
MM-HMM,
UM, AND YOU'LL SEE ON THE CHART ON THE LEFT, AAA IS THE HIGHEST RATING THAT ANY LOCAL GOVERNMENT CAN ACHIEVE.
UH, LOCAL GOVERNMENT, STATE, FEDERAL.
UM, THEN THERE'S THREE LEVELS OF A DOUBLE A RATING, THREE LEVELS OF A SINGLE A RATING.
AND THEN YOU GET DOWN INTO THE TRIPLE B RATING, WHICH WE RARELY SEE IN LOCAL GOVERNMENTS IN NORTH CAROLINA AND IN THE MID-ATLANTIC.
ON THE RIGHT HAND SIDE, JUST INTRODUCING SOME COMPARISONS, WE SUBSCRIBE TO A DATABASE THAT MOODY'S MAINTAINS, AND YOU'LL SEE IN THE UPPER RIGHT, UM, CITIES AND TOWNS, THEY RATE 240 CITIES AND TOWNS AS AAA.
OVER 1200 IS AA AND OVER 400 IS SINGLE A WITHIN NORTH CAROLINA, RIGHT BELOW IT CITIES AND TOWNS.
I'M NOT TALKING ABOUT COUNTIES.
UM, 16 AA, 22 AAS AND NO SINGLE AS.
SO MOODY'S ONLY RATES 38 CITIES AND TOWNS IN NORTH CAROLINA, AND THERE'S HUNDREDS OF THEM.
SO THERE ARE MANY CITIES AND TOWNS THAT DON'T HAVE RATINGS.
AND YOU'LL ALSO SEE OF THOSE, THEY RATE, ALL OF THEM ARE EITHER IN THE AA OR AA, UM, CATEGORY.
AND YOU KNOW, THEY LOOK AT A LOT OF DIFFERENT THINGS.
I'M VERY COMFORTABLE SAYING, I THINK WHEN WE TALK ABOUT THE CITY OF NEW BERN, HAVING WORKED WITH YOU FOR A NUMBER OF YEARS AND KNOWING YOUR FINANCIALS AND YOUR ECONOMY AND, AND DIFFERENT PARTS OF, OF WHAT THE RATING AGENCIES WOULD LOOK AT, I THINK WE'RE TALKING ABOUT A DOUBLE A CITY.
IT'S JUST A QUESTION OVER YOU IN THAT SORT OF LOW MIDDLE OR UPPER DOUBLE A.
BUT AGAIN, NOTHING THAT YOU'RE TALKING ABOUT DOING NOW REQUIRES A RATING TO HAVE THE REFERENDUM.
THAT WOULD ONLY BECOME, UH, A, A, A TASK IF YOU DEC IF THE VOTE VOTERS APPROVE THE DEBT AND YOU, YOU GO TO THE MARKET.
AND AGAIN, IT WOULD BE DONE AS PART OF THE ISSUANCE PROCESS.
OKAY? IF A, IF THE DECISION IS ULTIMATELY MADE TO GO FOR A RATING, DO YOU APPLY TO ALL THREE RATING AGENCY OR DO YOU PICK AND CHOOSE WHICH ONE YOU WANT TO? YOU HAVE COMPLETE DISCRETION OVER THAT 1, 2, 3.
AND NOW THERE'S A FOURTH THAT'S STARTING TO GET A LITTLE MORE TRACTION CALLED KROLL, K-R-O-L-L.
BUT THEY ARE A MUCH LESSER USED ENTITY.
MOODY'S AND STANDARD AND POS ARE THE MOST BROADLY USED.
FITCH IS SORT OF, UM, THIRD IF YOU WILL, IN TERMS OF OF MARKET SHARE.
AND BECAUSE YOU DON'T HAVE A RATING, NOW YOU HAVE THE ABILITY TO GO AND GET YOUR FIRST RATING ON A CONFIDENTIAL BASIS SO YOU CAN GET THE RATING FROM THEM AND THEN MAKE A DETERMINATION.
DO YOU WANT TO MOVE FORWARD WITH THAT IN THE BOND MARKET? SO YOU HAVE A LITTLE MORE LATITUDE HAVING, NOT BECAUSE YOU DON'T HAVE A RATING, UH, BUT YOU HAVE COMPLETE FLEXIBILITY ON WHO YOU GO TO.
GENERALLY THOUGH, ONCE YOU ESTABLISH YOUR, YOUR RATING, LET'S SAY WITH MOODY'S AND S AND P, YOU WOULD NORMALLY CONTINUE TO USE THEM EVERY TIME YOU GO TO THE MARKET.
NOW, I'M NOT TALKING ABOUT BANK FINANCING.
IF YOU GET A RATING AND YOU ISSUE GEO BONDS TO THE BOND
[00:30:01]
MARKET, THAT'S FINE.BUT THE NEXT YEAR YOU SAY, YOU KNOW, WE JUST WANT TO GO BORROW A SMALL AMOUNT OF MONEY FROM THE BANK, YOU'RE STILL ALLOWED TO DO THAT AND YOU DON'T NEED TO GET THAT RATED.
IT'S ONLY WHEN YOU GO TO THAT BOND MARKET WHERE YOU HAVE UNDERWRITERS AND INVESTORS THAT ARE BUYING, UH, PIECES OF YOUR BONDS THAT YOU WOULD NEED THE RATING.
BUT GENERALLY COMPLETE FLEXIBILITY ON WHO YOU USE.
BUT ONCE YOU ESTABLISH YOUR RATINGS, YOU USUALLY USE THE SAME ONES GOING FORWARD.
HOW MANY PEOPLE CAN BUY IN A BOND? HOW MANY DENOMIN THEY ARE SOLD IN $5,000 DENOMINATION.
SO YOU CAN HAVE MANY, MANY BOND HOLDERS THAT ULTIMATELY OWN YOUR BONDS IN THE MARKET AND THEY CAN CONTINUE TO BUY AND SELL THEM AMONGST EACH OTHER LONG AFTER YOU ISSUE.
AND WE BREAK THAT INTO TWO MAJOR CATEGORIES.
THERE'S INSTITUTIONAL INVESTORS.
SO MONEY MARKET FUNDS, MUNICIPAL BOND FUNDS, UM, INSURANCE COMPANIES, THEY BUY A LOT OF MUNICIPAL BONDS AND THEY BUY 'EM IN BIG QUANTITIES.
BUT YOU ALSO HAVE INDIVIDUALS, WHAT WE CALL RETAIL AND PEOPLE THAT MIGHT BUY A FEW BONDS HERE OR THERE FOR THEIR PORTFOLIO.
SO IT'S A PRETTY BROAD RANGE, BUT UM, YOU KNOW, IT'S IN 5,000 INCREMENTS.
SO DEPENDING ON THE SIZE OF YOUR DEAL, YOU CAN HAVE MANY, MANY INDIVIDUAL BOND HOLDERS.
OKAY, SO YOU'RE, WE'RE GONNA COME BACK TO THESE PEERS BECAUSE IT'LL HELP YOU UNDERSTAND HOW YOU CURRENTLY COMPARE ON DEBT.
UM, I DID WANT TO SHOW YOU ON PAGE NINE IN THE BOOK 11 ON THE SLIDE, UM, THE CURRENT TAX SUPPORTED DEBT OUTSTANDING.
SO WE'RE NOT TALKING ABOUT UTILITY DEBT HERE, NOT TALKING ABOUT WATER, SEWER OR ELECTRIC.
WE'RE TALKING ABOUT TAX SUPPORTED DEBT.
UM, ALL IN, YOU'VE GOT ABOUT $22 MILLION OF DEBT OUTSTANDING.
NONE OF THAT IS GO BONDS, RIGHT? HASN'T BEEN, NO, NONE OF THAT'S BEEN VOTED INSTALLMENTS, LOBS OR COPS, UH, WHETHER IT'S LONG TERM OR VE VEHICLE OR EQUIPMENT, IT'S ALL BASICALLY THE SAME.
IT'S, IT'S LOANS YOU'VE PLACED WITH A BANK THAT YOU'VE SECURED WITH SOME ASSET, WHETHER IT'S A BUILDING, A VEHICLE, PIECE OF EQUIPMENT, WHAT HAVE YOU.
SO IT'S SORT OF A MORTGAGE STYLE LOAN.
YOU HAVE A PUBLIC HEARING RESOLUTION AND YOU ISSUE THE DEBT.
SO $22 MILLION OF DEBT OUTSTANDING.
YOU CAN SEE WHAT IT LOOKS LIKE GRAPHICALLY IN THE UPPER LEFT.
UH, SO WE'RE JUST GETTING READY TO START 2025.
AND YOU CAN SEE WHAT THE ANNUAL DEBT SERVICE IS ON THE RIGHT HAND SIDE, WHAT WE CALL THE LONG TERM DEBT.
UH, IT'S BASICALLY EVERYTHING EXCEPT THE VEHICLES.
YOU KNOW, THE ANNUAL PAYMENT IN THE UPCOMING YEARS, ABOUT 2.3 MILLION AND IT'S STEPPING DOWN AND THEN IT STEPS UP, BUT THEN IT STEPS DOWN ANNUALLY 2028 AND BEYOND.
THE VEHICLE DEBT IS SHORTER BECAUSE YOU USUALLY ONLY DO THAT OVER FOUR OR FIVE YEARS.
YOU'RE PAYING ABOUT $950,000 A YEAR.
WHEN WE START TALKING ABOUT THE AFFORDABILITY OF NEW DEBT, WE START WITH THIS DEBT PROFILE, RIGHT? WE WANT TO KNOW WHAT DOES THE NEW DEBT LOOK LIKE WHEN WE LAYER IT IN ON TOP OF WHAT WE HAVE.
UM, UH, AND, AND WHAT'S NICE IS YOU GENERALLY HAVE A DECLINING DEBT STRUCTURE.
SO EVERY YEAR, FOR THE MOST PART 20, AFTER 2027, YOUR ANNUAL PAYMENT FOR THE EXISTING DEBT IS GOING DOWN, WHICH IS CREATING SOME AFFORDABILITY FOR THE NEW DEBT.
AND WHEN WE DO THIS ANALYSIS, WE'RE GOING TO EXCLUDE THE VEHICLE DEBT BECAUSE WHAT YOU'LL SEE IN 2030, YOU HAVE A $700,000 DROP RIGHT IN THE VEHICLE DEBT.
BUT THE REALITY IS YOU'RE PROBABLY GONNA FILL THAT WITH ANOTHER VEHICLE LOAN NEXT YEAR OR THE FOLLOWING YEAR.
SO WE DON'T WANT TO, UM, USE THAT BIG DECLINE IN THE VEHICLE DEBT TO HELP AFFORD THE GO BONDS IN OUR PLANNING WORK, ONLY TO FIND THAT YOU, YOU ISSUE ANOTHER VEHICLE LOAN BEHIND IT.
SO WHEN WE START TALKING ABOUT YOUR DEBT PROFILE AND THE DEBT AFFORDABILITY, WE'RE ONLY GONNA LOOK AT THAT LONG TERM DEBT.
THE FAR RIGHT COLUMN, UH, THIS IS A DEBT RATIO THAT'S COMMONLY LOOKED AT BY THE RATING AGENCIES IN PARTICULAR.
UH, YOU DO, UH, MIGHT CONSIDER A POLICY FOR THAT GOING FORWARD.
IT'S CALLED THE 10 YEAR PAYOUT RATIO.
AND ESSENTIALLY WHAT IT'S MEASURING IN A PERCENTAGE IS 10 YEARS FROM NOW, HOW MUCH OF THIS $22 MILLION WILL HAVE BEEN REPAID? HIGHER IS BETTER MEANS YOU'RE AMORTIZING THE DEBT MORE QUICKLY.
YOU'RE NOT BACK LOADING THE DEBT.
SO WHAT IT'S TELLING US IS 10 YEARS FROM NOW, 79% OF THIS DEBT WILL HAVE BEEN REPAID.
IT INDICATES A RAPID REPAYMENT SCHEDULE, THREE DIFFERENT DEBT RATIOS.
WE LOOK AT ON PAGE 10 OR PAGE 12 IN YOUR, UH, SCREEN.
[00:35:02]
ALL OF THESE ARE TELLING US THAT THE CITY HAS DEBT CAPACITY, UH, NOT UNLIMITED.THERE IS A LIMIT TO HOW MUCH DEBT YOU CAN ISSUE, BUT YOU HAVE A, I'LL CALL IT A FAIR AMOUNT OF DEBT CAPACITY AS MANY LOCAL GOVERNMENTS DO.
IN OTHER WORDS, ON PAPER, UNDER CERTAIN RATIOS, WE CAN DEMONSTRATE THAT YOU CAN TAKE ON NEW DEBT IN THE FUTURE AND STILL HAVE A VERY SOLID DEBT PROFILE.
BUT AGAIN, THAT DOESN'T MEAN IT'S AFFORDABLE.
IT DOESN'T MEAN YOU HAVE THE MONEY IN YOUR BUDGET TO MAKE THE PAYMENT.
SO WE ESTABLISH FIRST WHAT IS OUR CAPACITY.
AND WHEN YOU LOOK AT THESE THREE RATIOS ACROSS THE TOP, WHETHER IT'S THE 10 YEAR PAYOUT WHICH YOU WANT HIGHER, YOU WOULD WANT THAT ABOVE THE POLICY RANGE, WHICH YOU ARE NOW DEBT TO ASSESS VALUE IN THE MIDDLE DEBT OUTSTANDING AS A PERCENT OF YOUR TAX BASE.
YOU WANT THAT LOWER AND DEBT SERVICE TO EXPENDITURES ON THE RIGHT.
HOW MUCH OF YOUR ANNUAL BUDGET IS GOING TO DEBT PAYMENTS? YOU WANT THAT LOWER.
IN ALL OF THESE CASES, YOU ARE BETTER THAN THE TYPICAL POLICY RANGE, WHICH MEANS YOU COULD TAKE ON SOME ADDITIONAL DEBT AND STILL BE IN COMPLIANCE WITH WHAT WE WOULD CONSIDER TO BE A VERY SOLID POLICY.
AND THE, THE CHARTS AT THE BOTTOM ARE TELLING YOU, WELL, HOW WOULD WE COMPARE TO THESE OTHER RATED COMMUNITIES? RIGHT? AND NEW BERN IS AT THE TOP IN GOLD.
AND ON THAT, ON THAT BOTTOM CHART IN THE BOTTOM LEFT, YOU WANT YOUR GOLD BAR FURTHER TO THE RIGHT.
AND YOU CAN SEE YOU COMPARE VERY WELL WHETHER WE'RE COMPARING YOU TO THE CITIES AND TOWNS NATIONALLY AND LIGHT GREEN OR THE CITIES AND TOWNS WITHIN NORTH CAROLINA AND THE DARK GREEN, YOU'RE IN REALLY GOOD SHAPE.
HOWEVER, YOU DON'T WANT YOUR BAR TO THE RIGHT.
YOU WANT IT SMALLER AND YOU COMPARE VERY WELL AGAIN TO BOTH THE CITIES AND THE, UH, US AND IN NORTH CAROLINA THAT CARRY THOSE AAA AND AA RATINGS.
SO I GUESS THE, THE TAKEAWAY BEFORE I MOVE ON IS, AGAIN, WHILE YOU DON'T HAVE POLICIES IN PLACE TODAY, THAT MIGHT BE SOMETHING THAT WE WANT TO PUT IN PLACE GOING FORWARD.
WE'VE IDENTIFIED WHAT THE RANGE WOULD LIKELY BE THAT WE WOULD RECOMMEND, AND IN ALL OF THEM, YOU ARE STRONGER THAN THE RECOMMENDED POLICY.
YOU COMPARE WELL TO OTHER PLACES THAT ARE HIGHLY RATED.
AND THE, AND THE TAKEAWAY WOULD BE THE CITY HAS CAPACITY.
THIS IS ALL A VERY REASONABLE CONVERSATION TO BE HAVING ABOUT THE POTENTIAL TO BE ISSUING DEBT IN THE FUTURE.
ALRIGHT, SO NOW WE WANNA TALK ABOUT, SORRY IT'S A LITTLE HOT HERE FOR ME.
UM, WE WANNA TALK A LITTLE BIT ABOUT THE REPAYMENT PLAN, RIGHT? SO IF YOU LOOK AT PAGE 11 IN THE BOOK, UM, THIS IS VERY SIMPLE.
UM, ON THE, ON THE LEFT HAND SIDE, WE'RE LOOKING AT FISCAL YEAR, STARTING WITH FISCAL YEAR 25, THE YEAR WE'RE ABOUT TO GO INTO.
AND THAT CURRENT LONG TERM TAX SUPPORTED DEBT PAYMENT IS UNDER COLUMN B, AS IN BOY, WE KNOW WE HAVE TO MAKE THOSE PAYMENTS.
THAT'S DEBT WE'VE ALREADY COMMITTED OURSELVES TO.
WE HAVE PLACEHOLDERS IN C AND D FOR NEW DEBT.
WE'RE GONNA FILL THAT IN IN A MOMENT WITH A POTENTIAL $10 MILLION BORROWING FOR STARTERS.
UM, SO RIGHT NOW, COLUMN E IS JUST SIMPLY RESTATING COLUMN B AS IN BOY.
THAT IS THE DEBT SERVICE PAYMENTS YOU HAVE TO MAKE ON THE LONG TERM DEBT YOU'VE ALREADY ISSUED.
COLUMN F IS HOW YOU'RE PAYING FOR IT.
IT'S A GENERAL FUND APPROPRIATION EQUAL TO 2.3 MILLION.
SO YOUR, YOUR CURRENT YEAR PAYMENT IN 25 IS 2.3 MILLION.
AND YOU HAVE 2.3 MILLION IDENTIFIED IN YOUR 25 BUDGET TO MAKE THAT PAYMENT.
SO IT'S PERFECTLY BALANCED IN THE UPCOMING YEAR, FISCAL 25.
BUT THEN THE, THE DEBT STARTS TO STEP DOWN, STEPS UP A YEAR, BUT THEN IT STEPS DOWN ANNUALLY.
AND YOU CAN SEE UNDER COLUMN H ALL WE'RE DOING IS COMPARING THE PAYMENT UNDER E AND THE REVENUES UNDER G.
AND YOU CAN SEE IN COLUMN H EVERY YEAR IS POSITIVE.
SO THE POINT OF WHAT WE'RE SAYING HERE IS IF YOU CAN CONTINUE TO APPROPRIATE THAT SAME $2.3 MILLION A YEAR EVERY YEAR GOING FORWARD, EVEN THOUGH YOUR ACTUAL PAYMENTS ARE COMING DOWN, YOU'RE GOING TO BE SETTING YOURSELVES UP TO HAVE SOME MONEY TO HELP PAY FOR THE NEXT DEBT ISSUE.
A GEO BOND IN THIS SCENARIO, RIGHT? SO IT'S JUST GETTING TO A BUDGETING PRACTICE WHERE JUST BECAUSE YOUR DEBT DROPS A COUPLE HUNDRED THOUSAND DOLLARS ONE YEAR, YOU MIGHT DECIDE AS PART OF THE PLAN, KEEP THE FUNDING LEVEL FLAT SO WE DON'T LOSE THAT AND IT'LL HELP US BETTER AFFORD THE NEXT DEBT ISSUE OR THE NEXT PROJECT.
AND, AND THAT COLUMN H IS WHERE WE WOULD START WITH WHAT'S OUR AFFORDABILITY.
[00:40:01]
IF YOU WERE TO BUDGET THAT WAY, COLUMN H REPRESENTS DOLLARS THAT COULD BE USED TO HELP OFFSET NEW DEBT GOING FORWARD.SO AS I SAID, WE'RE GONNA LOOK AT A GENERIC $10 MILLION BORROWING.
AND THIS IS GONNA GET TO NOT ONLY HELPING YOU UNDERSTAND HOW DO YOU AFFORD THAT, BUT IT'S ALSO GONNA GIVE YOU A LITTLE BIT OF INSIGHT TO SOME OF THE THINGS THAT WE'LL BE DOING AS PART OF THE LOCAL GOVERNMENT COMMISSION'S PROCESS FOR ISSUING DEBT AND, AND MAKING AN APPLICATION.
SO WE'VE DONE THIS VERY, VERY SIMPLY.
WE PICKED 10 MILLION 'CAUSE IT'S A NICE ROUND NUMBER AND WE'RE GONNA ASSUME THAT IT'S ISSUED IN FISCAL YEAR 26, RIGHT? SO IF YOU HAVE A REFERENDUM IN THE FALL OF 25, THAT'S FISCAL 26, WE ISSUE IN NEXT SPRING, RIGHT? SPRING OF 26, WE ISSUE THE DEBT, THE VOTERS APPROVE IT.
LET'S GO ISSUE $10 MILLION IN THE SPRING OF 26.
THE TYPICAL GENERAL OBLIGATION REPAYMENT IS A 20 YEAR TERM WITH WHAT WE CALL LEVEL PRINCIPLE.
SO YOU CAN SEE THAT $500,000 A YEAR OF PRINCIPLE OVER 20 YEARS IS 10 MILLION AND THE INTEREST STARTS AT 5 34 AND IT STEPS DOWN EVERY YEAR.
SO THE TOTAL PAYMENT IS A LITTLE OVER A MILLION DOLLARS IN THE FIRST YEAR.
AND, AND THAT WOULD OCCUR IN FISCAL YEAR 27.
SO YOU VOTE IN, IT WAS OCTOBER OR NOVEMBER OF 25.
OCTOBER OF 25, VOTERS APPROVE IT.
YOU ISSUE THE BOND SIX MONTHS LATER, SPRING OF 26, AND YOU MAKE YOUR PAYMENTS STARTING IN FISCAL 27.
AND UNDER THE LG C'S GUIDANCE OF USING THIS RATE OF THE SAFE HARBOR RATE, IT'S FOOTNOTED THERE AT 5.344% VERY SPECIFIC RATE.
UM, THE FIRST YEAR'S PAYMENT WOULD BE 1,000,034.
AND IN A VACUUM THAT WOULD EQUAL ABOUT TWO PENNIES ON YOUR TAX RATE, EACH PENNY ON YOUR TAX RATE TODAY IS GENERATING ABOUT $494,000.
THAT'S THE REVENUE GENERATED FROM A PENNY.
WE ARE ASSUMING A 1% GROWTH RATE IN YOUR TAX BASE, NOT TALKING ABOUT REVALUATION, JUST A CONSERVATIVE GROWTH RATE.
AND BY 2027, IN ORDER TO MAKE A PAYMENT OF 1,000,034, YOU WOULD NEED A LITTLE OVER TWO PENNIES.
SO IN A, AND I'M NOT TALKING ABOUT THE PRIOR SLIDE WHERE I SAID YOU KEEP BUDGETING THE SAME 2.3 MILLION EVERY YEAR JUST IN A VACUUM.
WHAT IS A $10 MILLION GO 20 YEAR EQUAL TO IN PENNIES? A LITTLE OVER TWO PENNIES.
OKAY? AND THAT'S ONE WAY TO MEASURE THE AFFORDABILITY OF, OF DEBT IS JUST TO DO IT THIS WAY.
AND THAT'S ULTIMATELY INFORMATION THAT HAS TO COME OUT AND BE DISCUSSED AND DISCLOSED AS PART OF THE REFERENDUM PROCESS.
TAXPAYER, YOU CAN ANTICIPATE THIS $10 MILLION BOND THAT WE'RE ASKING YOU TO APPROVE WOULD CARRY THE EQUIVALENT OF TWO PENNIES ON YOUR TAX RATE.
OKAY? BUT THERE MAY BE ANOTHER WAY THAT WE WANT TO LOOK AT THIS.
AND THIS IS WHAT IS SO NICE ABOUT STARTING POTENTIALLY STARTING THIS PROCESS SO EARLY IS THERE'S A LOT OF ITERATIONS OF THE PLANNING MODELS, A LOT OF SCENARIOS THAT I'M SURE YOU ALL ARE GONNA WANT TO LOOK AT.
YOU START THINKING ABOUT, ALL RIGHT, HOW DO WE PLAN FOR THIS? WELL, WE GOTTA FIGURE OUT WHAT THE QUESTIONS ARE.
HOW MUCH DO WE WANT TO ASK THE VOTERS TO APPROVE? AND THEN WHEN WOULD WE ISSUE THAT IF THEY APPROVED IT? 'CAUSE WE GOT SEVEN YEARS, YOU'RE UNLIKELY TO I ISSUE ALL OF THAT AT ONCE AT THE FRONT.
IT'S UNLIKELY YOU'LL DO IT ALL AT THE END.
SO WE GOTTA MAKE SOME ASSUMPTIONS ABOUT HOW THAT DEBT IS ISSUED OVER THAT SEVEN YEAR PERIOD.
ALL OF THOSE THINGS WILL INFLUENCE THE OUTCOME OF THE AFFORDABILITY OF THAT DEBT.
AND SO WHAT WE'VE DONE IS WE'VE TAKEN THAT SAME 10 MILLION AND SAID, LET'S LAYER THAT IN ON TOP OF THE EXISTING DEBT 20 YEAR TERM 5.3%.
IF YOU BORROW 10 MILLION IN THE VERY BOTTOM RIGHT, YOU'LL SEE PRINCIPLE PLUS INTEREST OVER THE LIFE OF THE LOAN IS 15.6 MILLION.
OKAY? YOU'LL SEE ON THE NEXT SLIDE, PAGE 15, THAT IF YOU DID THAT AND WE GO BACK AND REVISIT THOSE DEBT RATIOS AND POTENTIAL POLICIES, THEY ALL WORK.
YES, YOUR DEBT PROFILE GROWS A LITTLE BIT, BUT NONE OF THEM BREACH THE PROPOSED POLICY LEVEL.
AND IN FACT, YOU STILL HAVE A FAIR AMOUNT OF ROOM WITHIN THOSE POLICY LEVELS, UM, ON TOP OF THE 10 MILLION.
SO IT WOULD JUST BE OUR WAY OF SAYING THIS HYPOTHETICAL 10 MILLION CLEARLY FITS WITHIN YOUR CAPACITY, BUT LET'S TALK ABOUT THE AFFORDABILITY.
[00:45:01]
WE'VE DONE ON PAGE 16 IS WE HAVE CIRCLED BACK TO THAT, THAT THAT, UM, EARLIER SLIDE, RIGHT? WHERE WE HAVE UNDER COLUMN B AS IN BOY, THE EXISTING LONG-TERM DEBT, RIGHT? THAT'S EXACTLY WHAT WE LOOKED AT A FEW SLIDES AGO.C IS THE NEW DEBT ASSOCIATED WITH THIS $10 MILLION HYPOTHETICAL BORROWING.
SO COLUMN B PLUS C EQUALS COLUMN E, AND THAT WOULD BE WHAT YOUR NEW DEBT SCHEDULE WOULD LOOK LIKE, INCLUDING EXISTING OBLIGATIONS PLUS THIS HYPOTHETICAL 10 MILLION THAT WOULD BE ISSUED IN FISCAL 26.
DEBT SCHEDULE COLUMN F, WE'VE GOT THE SAME EXACT REVENUES AS THE PRIOR VERSION, $2.3 MILLION A YEAR.
LET'S JUST HOLD THAT FLAT INTO THE FUTURE.
AND WHAT YOU SEE UNDER COLUMN H IS YOU HAVE A NUMBER OF YEARS THAT ARE RED AND IN BRACKETED YOU'RE SHORT, RIGHT? AND THEN WE EQUATE THAT TO PENNIES AND IT'S ALL IN UNDER COLUMN J.
IT'S ACTUALLY ABOUT 1.75 PENNIES.
SO WE'VE ESSENTIALLY MEASURED THE AFFORDABILITY OF THIS 10,000,002 WAYS.
HYPOTHETICALLY IT'S THE EQUIVALENT OF TWO PENNIES, BUT WHEN WE BUILD IT INTO THIS MODEL WITH THE DECLINE IN THE EXISTING DEBT AND HOLDING YOUR BUDGETING FOR DEBT CONSTANT, IT'S ACTUALLY ABOUT 1.75 PENNIES.
SO IT'S JUST A WAY TO FINE TUNE THE PLANNING WORK A LITTLE BIT TO TRY TO GIVE PERHAPS A MORE EXACT, UM, CALCULATION OF THE IMPACT OF THE VOTE OF THE REFERENDUM.
UM, AND JUST BE A LITTLE MORE UNDERSTANDING FOR YOU ALL AS TO AS YOU GO THROUGH THE DIFFERENT ITERATIONS THAT YOU'LL WANT TO SEE.
HOW DOES ACCELERATING THE DEBT ISSUANCE PROCESS IMPACT US VERSUS SLOWING IT DOWN? QUICK QUESTION.
WHAT INTEREST RATE WILL WE BE LOOKING AT AT AT THAT? SO EVERY, EVERYTHING WE'RE ASSUMING IN HERE IS THAT SAFE HARBOR RATE OF 5.3.
OKAY? THAT'S WHAT THE LGC SUGGESTS WE USE.
BUT IN REALITY, IF YOU ARE IN THE MARKET TODAY, YOU'RE GONNA BE UNDER 4%.
BUT WHEN THE TIME COMES TO GO THROUGH THIS PROCESS, THEY WANT YOU TO, I, I SUPPOSE YOU CAN, YOU CAN USE A SERIES OF OTHER ASSUMPTIONS, BUT YOU RUN THE RISK WHEN YOUR REFERENDUM GOES TO THE LOCAL GOVERNMENT COMMISSION FOLLOWING THE VOTE THAT THEY DON'T APPRECIATE OR AGREE WITH SOME OF THE ASSUMPTIONS YOU MADE, RIGHT? IF YOU SAY, WELL, I WANT TO USE 3% INTEREST RATE, THEIR POSITION MAY BE YOU'VE UNDERESTIMATED THE IMPACT OF THESE BONDS, SO THAT'S WHY THEY'RE SUGGESTING THIS 5.3%, BUT TODAY YOU WOULD BE A FULL GOSH, ALMOST ONE AND A HALF PERCENT BELOW THAT, WHICH WOULD MAKE ALL OF THESE NUMBERS LOOK BETTER.
AND THAT'S OFTENTIMES SOMETHING THAT WE'RE ASKED TO DO IS RUN US THIS SCENARIO USING THE SAFE HARBOR INFORMATION SO WE UNDERSTAND WHAT HAS TO, WHAT, WHAT, WHAT WE LOOK LIKE UNDER THE LOCAL GOVERNMENT COMMISSION'S, GUIDELINES OR RECOMMENDED PRACTICES, BUT ALSO SHOW US WHAT IT ACTUALLY LOOKS LIKE IN THE MARKET SO THAT YOU HAVE PERSPECTIVE.
AND THAT MIGHT BE SOMETHING THAT YOU WOULD SHARE WITH THE COMMUNITY WHEN THE TIME COMES WE'RE REQUIRED TO DISCLOSE THIS, BUT WE ALSO WANT YOU TO UNDERSTAND THAT IT'S A VERY CONSERVATIVE APPROACH AND WE MIGHT ACTUALLY DO BETTER.
SO, SO JUST FOR SIMPLIFICATION PURPOSES, VEHICLES ARE NOT FACTORED IN THIS CALCULATION, CORRECT? SO WE'RE ONLY LOOKING AT EXISTING CAPITAL EXPENDITURE DEBT LESS VEHICLES.
SO WHAT YOU'RE SAYING IS THEORETICALLY BASED OFF OF THIS INFLATED INTEREST RATE THAT WE'RE REQUIRED TO LOOK AT, RIGHT? WE COULD BORROW $10 MILLION AND WE WOULD NEED TO RAISE THE TAX RATE 1.75 CENTS.
OR YOU WOULD NEED TO FIND THE REVENUE EQUAL TO THAT 1.75 CENTS.
LIKE I SAID, WE WOULD NEED TO RAISE THE TAX RATE 1.75%, RIGHT? THE THE COLUMN H THERE, THOSE RED NUMBERS IS THAT'S THE GAP WE'RE TRYING TO FILL, OKAY? AND WITH A PENNY GENERATING APPROXIMATELY $500,000, OKAY? AND YOU, AND YOU, IF YOU WERE TO DO THAT, UM, THERE WILL COME A TIME WHERE YOU START TO HAVE SOME MORE BORROWING CAPACITY BEHIND THAT 10 MILLION THAT WOULDN'T REQUIRE ADDITIONAL REVENUE, RIGHT? BECAUSE REMEMBER HOW THAT DEBT IS PROJECTED TO BE ISSUED.
IT'S THE FIRST YEAR HITS YOU THE HARDEST THERE.
IF YOU'RE LOOKING ON YOUR SCREEN, Y'ALL HAVE THE SCREEN IN FRONT OF YOU.
IF YOU'RE LOOKING IN THE SCREEN IN THAT UPPER LEFT, FY 20 SEVENS YOUR BIGGEST YEAR, AND THEN IT STARTS TO STEP DOWN.
SO THERE WILL COME A TIME EVEN WITH THE 10 MILLION, EVEN WITH THE 1.75
[00:50:01]
PENNIES YOU NEED TO FUND IT A COUPLE YEARS LATER, YOU START TO HAVE SOME ADDITIONAL AFFORDABILITY.THAT'S THE BEAUTY OF THAT LEVEL.
PRINCIPLE STRUCTURE HITS YOU THE HARDEST ON THE FIRST YEAR, YES, BUT IT DOES HELP HAVE A DECLINE STRUCTURE.
SO YOU ALWAYS HAVE A LITTLE BIT OF MONEY THAT COULD BE FREED UP FOR SOMETHING ELSE.
UH, HOPEFULLY THIS IS ALL DIGESTIBLE.
THESE ARE REALLY PRETTY SIMPLE NOW THAT WE'VE GONE THROUGH SOME THINGS.
THE FIRST CASE IS WHAT IF WE DON'T DEDICATE ANY NEW REVENUE TO THIS, UH, ENDEAVOR? HOW MUCH COULD WE BORROW AND WIN UNDER OUR CURRENT DEBT STRUCTURE AND OUR CURRENT BUDGETING PRACTICES? CASE TWO IS WHAT IF WE WERE TO DEDICATE THE EQUIVALENT OF ONE PENNY, A NEW PENNY'S WORTH OF REVENUE BEGINNING IN FISCAL 27, AGAIN, THAT WOULD BE THE BUDGET.
FY 27 BUDGET WOULD BE THE FIRST BUDGET Y'ALL WOULD WORK ON FOLLOWING THE REFERENDUM.
SO REFERENDUM'S APPROVED CASE TWO SAYS, BEGINNING IN 27 BUDGET, WE'RE GONNA DEDICATE AN ADDITIONAL ONE PENNY.
CASE THREE IS AN ADDITIONAL THREE PENNIES CASE FOUR IS AN ADDITIONAL FIVE PENNIES.
AGAIN, JUST HYPOTHETICAL, WHAT DOES THAT DO FOR US IN TERMS OF AFFORDABILITY UNDER THAT STANDARD 20 YEAR 5.3% ASSUMPTION.
AND PAGE 19 OR 21 ON THE SLIDE ON THE SCREEN BRINGS IT ALL TOGETHER.
UM, LOOKING UNDER CASE ONE, WE SHOW YOU WITHOUT ANY NEW REVENUE BEYOND WHAT YOU'RE ALREADY BUDGETING, HOW MUCH COULD YOU AFFORD TO ISSUE IN FISCAL YEARS 26 TO 2030 AND DOWN ON LINE SEVEN, IT'S A LITTLE, IT'S CALL IT 7.7 MILLION, BUT IT DOESN'T HAPPEN ALL AT ONCE.
YOU HAVE TO SORT OF LEG INTO IT AS THE, UH, DEBT IS FALLING OFF.
SO THERE'S, THERE'S SOME AFFORDABILITY, BUT IT'S SOMEWHAT LIMITED.
CASE TWO, IF YOU START DEDICATING THE ANOTHER ONE PENNY'S WORTH OF REVENUE, CALL IT $500,000 BEGINNING IN 27, YOU CAN SEE IT'S THIR A LITTLE OVER 13 MILLION AND IT'S A LITTLE MORE FRONT LOADED.
SO THAT GIVES YOU AN IDEA OF WHAT ONE PENNY MIGHT DO TO HELP FUND A PROGRAM LIKE THIS.
AND THEN CASE THREE IS THREE PENNIES.
ADDITIONAL STARTING IN 27 HELPS YOU WITH ABOUT TO FUND OVER THAT PERIOD, ABOUT 24 AND A HALF MILLION CASE, FOUR OR FIVE PENNIES, UH, ABOUT 35 MILLION.
THE, THE, THE CONCEPT OF THIS AS YOU ALL EVOLVE AGAIN ON WHAT ARE THE CATEGORIES OF GEO BONDS THAT YOU MIGHT WANT TO ASK THE VOTERS TO CONSIDER, HOW MUCH IN EACH CATEGORY WOULD YOU ASK THEM TO CONSIDER FIVE, 10, 15 MILLION? WHAT HAVE YOU? UM, AND OVER WHAT PERIOD OF TIME WOULD YOU ISSUE THAT DEBT? WE CAN START TO BACK INTO, UM, YOU KNOW, WHAT THE REPAYMENT WOULD LOOK LIKE AND WHAT YOU MIGHT NEED TO CONSIDER DOING IN FUTURE BUDGETS TO BRING NEW REVENUE INTO THE MIX.
AND AGAIN, ALL OF THAT'S GOT TO BE VETTED AND, UM, PUT OUT FOR YOUR REVIEW FOR, UH, ANYBODY THAT'S GONNA ATTEND A PUBLIC HEARING OR, UM, ULTIMATELY, UM, VOTE ON THE MEASURE.
ALL OF THESE AT THE BOTTOM HALF OF THE CHART FIT WITHIN THOSE THREE DEBT POLICIES.
SO EVEN ON THE FAR RIGHT CASE FOUR, UM, CERTAINLY YOUR DEBT PROFILE CHANGES, RIGHT? YOU'VE ONLY GOT $22 MILLION OF DEBT.
RIGHT NOW WE'RE TALKING ABOUT THE POTENTIAL OF ISSUING UP TO 35 MORE IN THAT CASE FOR, BUT EVEN SO, ALL OF THOSE DEBT RATIOS ARE STILL WITHIN THE BOUNDS OF WHAT WE WOULD CONSIDER TO BE A SOLID POLICY LEVEL.
SO FOR Y'ALL, I THINK LIKE MANY PLACES, IT'S LESS ABOUT DO WE HAVE THE CAPACITY TO DO THIS? IT'S MORE ABOUT HOW MUCH DO WE WANT TO DO AND WHEN AND HOW DO WE MAKE SURE WE CAN, UH, AFFORD IT? WE'RE READY IN WHATEVER BUDGET YEAR IT IS TO START REPAYING THAT DEBT.
AND THAT'S ALL PART OF THIS PROCESS THAT ULTIMATELY, AS I SAID, HAS TO BE PRETTY TRANSPARENT TO THE VOTERS, UM, AS YOU GO THROUGH THE LEGAL STEPS REQUIRED.
AND I THINK I BASICALLY SUMMARIZED MY, MY OBSERVATIONS HERE ON, ON PAGE 20 JUST A MOMENT AGO.
I MEAN, HOPEFULLY THIS IS A GOOD STARTING POINT.
UM, AND I, I CAN IMAGINE CONVERSATIONS, WORK SESSIONS, UM, YOU KNOW, PROVIDING STAFF WITH DIRECTION THEY WOULD PROVIDE US WITH DIRECTION
[00:55:01]
ON SOME UPDATES.IT'S A LOT OF INFO, SO, UM, HAPPY TO ANSWER QUESTIONS, HAPPY TO COME BACK AFTER YOU'VE HAD TIME TO DIGEST IT.
IT'S A GREAT, IT'S A GREAT START, GREAT OVERVIEW, UM, VERY THOROUGH AND, UH, CERTAINLY HAS GIVEN US PLENTY TO THINK ABOUT AS WE MOVE FORWARD.
SO I GUESS FROM A STAFF PERSPECTIVE, UM, AT SOME POINT IN TIME YOU'RE GOING TO LOOK FOR SOME DIRECTION FROM THE BOARD ON WHETHER OR NOT THERE'S AN APPETITE TO DO THIS OR NOT.
I, I WOULD THINK WOULD BE THE FIRST STEP, AND THEN THE NEXT STEP IS IF THERE IS, THEN WE WOULD NEED TO START LOOKING AT PROJECTS AND CATEGORIES AND THINGS LIKE THAT.
IS THAT SAFE TO SAY? AND SO BASED ON OUR CONVERSATIONS, UM, AT PREVIOUS WORKSHOPS APPEARS THAT THERE HAS BEEN AN APPETITE.
AND SO IF THERE IS AN APPETITE, AND I THINK WHAT WE CAN DO IS COME BACK, UM, IN ABOUT SIX WEEKS OR SO WITH, WITH ANOTHER WORKSHOP AND ACTUALLY START TALKING ABOUT PROJECTS THAT THE BOARD CAN SUPPORT AND GOING FROM THERE.
I, I WOULD JUST SAY I'VE, I'VE TALKED TO, I DON'T KNOW, PROBABLY A DOZEN PEOPLE OVER THE PAST MONTH WHILE WE'VE TALKED ABOUT TAX RATES AND ELECTRIC RATES AND EVERYTHING ELSE.
AND WE'VE, WE'VE TALKED ABOUT THIS AND I'VE MENTIONED THIS, AND NOT ONE SINGLE PERSON HAS HAD A NEGATIVE COMMENT.
THEY LIKE THE IDEA OF BEING ABLE TO GO TO THE BALLOT BOX, LOOK AT A PROJECT AND SAY, YES, I'M WILLING TO PAY A PENNY FOR THIS PROJECT, VERSUS JUST GIVING FREE REIGN TO THE BOARD TO MAKE THOSE DECISIONS.
SO EVERYONE I SPOKE TO WAS VERY POSITIVE.
OF COURSE, I'M SURE THERE'S PEOPLE OUT THERE THAT'S NOT, AS WE ALL KNOW, NOT EVERYBODY'S GONNA AGREE WITH IT, BUT BOARD, HAVE ANY QUESTIONS OR COMMENTS I'D LIKE TO POINT OUT IN THE BACK OF YOUR BOOK? I PUT IN THE PURPOSES, UM, AND YOU GO TWO DAYS TO SEE ITSEPARATE OUT CITY IN SOME AREAS AS WELL.
SO, OKAY, SO FOSTER, YOU SAID COME BACK IN SIX WEEKS.
WHAT, WHAT WOULD YOU ANTICIPATE A MEETING IN SIX WEEKS LOOKING LIKE? UH, WELL WHAT I COULD TELL YOU NOW IS I, I THINK WHAT WE'RE DEFINITELY LOOKING AT IS PARKS AND RECREATION, PUBLIC SAFETY, STREET SIDEWALKS, AND POSSIBLY AN APPETITE FOR A COMBINED ADMINISTRATIVE BUILDING.
WHAT CATEGORY THAT WOULD BE IN THAT WOULD BE UP TO DISCUSSION.
BUT IF THE BOARD IS IN FAVOR OF THOSE TYPES OF CATEGORIES, THEN WE CAN GET WITH STAFF AND WE CAN GET WITH YOU INDIVIDUALLY TO SEE IF YOU HAVE ANY, ANY PROJECTS THAT YOU WOULD LIKE TO BE INCLUDED WITH THAT, OR ANY OTHER CATEGORIES YOU MIGHT BE INTERESTED IN AFTER YOU LOOK AT, AT THE, UH, AT, AT THE INFORMATION ON BONDS.
AND THEN WE CAN BRING SOME PROJECTS TOGETHER, THEN START LOOKING AT IN REALITY, WHAT ARE THE COST GONNA BE WHEN THAT TIME COMES TO ACTUALLY START DOING THAT CONSTRUCTION.
AND SO AGAIN, WE SAID THERE WAS NO CAP ON THE AMOUNT THAT WE CAN REQUEST, IS THAT CORRECT? THAT'S CORRECT, YEAH, THERE IS, I'M NOT AWARE OF A LEGAL CAP.
UM, AND YOU JUST, OBVIOUSLY WE NEED TO, WITH THE FINANCIAL DISCLOSURES REQUIRED, WE HAVE TO DO THE CALCULATION OF WHAT THE LIKELY IMPACT WOULD BE.
SO THERE IS NO LEGAL CAP, BUT WE'VE GOTTA MAKE SURE THAT WE CAN COMMUNICATE WHAT IS THE IMPACT ON OUR BUDGET, ON OUR TAX RATE FOR WHATEVER AMOUNT YOU LAND ON.
AND YOU KNOW, SOMETHING WE SEE, I JUST OFFER THIS UP, YOU KNOW, BECAUSE THESE BONDS WOULD BE AUTHORIZED FOR A PERIOD OF SEVEN YEARS.
AGAIN, YOU, YOU DON'T HAVE TO ISSUE IT ALL AT ONCE.
YOU CAN ISSUE IT OVER TIME WHEN YOU'RE THINKING ABOUT PROJECTS AND IN THE FALL OF 24 OR THE SPRING OF 25, UH, NEED TO BE THINKING ABOUT, WELL, THIS MIGHT NOT BE ISSUED FOR THREE OR FOUR YEARS AND THE COST OF INFLATION.
SO THAT'S ANOTHER CHALLENGE WITH THIS, IS YOU DECIDE, I WANT TO BORROW X FOR A FIRE STATION, JUST HYPOTHETICALLY, AND WE THINK THAT'S A, A $10 MILLION PROJECT TODAY.
ANTICIPATING THAT, YOU KNOW, THAT MIGHT BE THREE YEARS OUT.
AND HOW DO, HOW DOES THE COST POTENTIALLY CHANGE? SO THAT STARTS TO BE PART OF YOUR THINKING PROCESS AS WELL TO LAND ON WHAT IS THE AMOUNT THAT WOULD GO ON THE BALLOT.
UM, WE OFTENTIMES SEE PEOPLE THAT VOTED SOMETHING SEVERAL YEARS AGO AND NOW THEY'RE READY TO MOVE FORWARD WITH THE PROJECT AND THE CONSTRUCTION WORLD'S VERY DIFFERENT AND THEY, THEY, YOU KNOW, THEY DIDN'T VOTE ENOUGH IN HINDSIGHT, AND THEY HAVE TO RE-ENGINEER, REDESIGN, OR FIND OTHER FUNDING.
SO THAT'S SOMETHING THAT I THINK YOU'LL NEED TO THINK ABOUT AS YOU MOVE FORWARD AS WELL.
SO WE HAVE SEVEN YEARS TO ISSUE, CORRECT? IS IS THERE A CASE SCENARIO WHERE SOMEONE ISSUED ALL AT ONE TIME? UH, YES,
[01:00:01]
YES, ABSOLUTELY.THERE ARE PROBABLY A LOT OF SCENARIOS, OFTENTIMES WITH SCHOOLS, I KNOW YOU DON'T DO SCHOOLS, BUT A COUNTY WILL VOTE SCHOOLS AND THEY'LL, YOU'LL SEE THAT DONE OVER A NUMBER OF YEARS.
BUT, UM, FOR A SMALLER REFERENDUM, AND MAYBE IT, THE, THE QUESTION TO THE VOTERS IS ONE PROJECT THAT YOU HAVE IN MIND OR TWO, AND YOU'LL SEE THAT HAPPEN OFTENTIMES ALL AT ONCE, THAT WOULD BE MOST COST EFFECTIVE.
YOU CERTAINLY, UM, YES, YOU CERTAINLY WILL.
FEWER BOND ISSUES WILL ALLOW YOU TO SAVE SOME ISSUANCE COSTS.
UM, THE RULE OF THUMB IN YOUR PLANNING WORK FOR THE LGC WOULD BE THE VOTERS APPROVE THE REFERENDUM.
THAT IN AND OF ITSELF DOESN'T PAVE THE WAY FOR THE LGC TO LET YOU ISSUE THE DEBT.
THEY WANT TO SEE THAT WHEN YOU ISSUE THE DEBT, YOU HAVE PROJECTS READY AND ARE BID TO MOVE FORWARD.
SO THERE IS A LITTLE BIT OF A GOVERNOR THAT THEY HAVE TO SAY, YES, THE VOTERS APPROVED X MILLION, BUT WE ONLY, WE DON'T THINK YOU'RE READY TO ISSUE ALL OF THAT.
YOU CAN ISSUE A PIECE OF IT BECAUSE ONLY ONE PROJECT'S READY.
SO, UM, WHILE IT'S MORE EFFICIENT TO ISSUE IT ALL AT ONE TIME, YOU SAVE SOME MONEY, PRACTICALLY SPEAKING, THE LOCAL GOVERNMENT COMMISSION MIGHT SLOW YOU DOWN AND MAKE YOU BREAK IT UP, OR, UH, YOU MIGHT JUST NEED TO BREAK IT UP SO THAT YOU CAN MANAGE MULTIPLE PROJECTS AT THE STAFF LEVEL.
THIS MAY BE MORE OF A LEGAL QUESTION, BUT USING THE EXAMPLE THAT YOU'VE GIVEN US 10 MILLION, UM, GETS, GETS APPROVED BY THE VOTERS, WE GO OUT AND BORROW $10 MILLION KNOWING FULL WELL THAT WE'RE NOT GONNA SPEND $10 MILLION RIGHT AWAY.
UM, ARE WE ABLE OR PROHIBITED FROM TAKING THAT MONEY, INVESTING IT? I THINK WE'RE TALKING ARBITRAGE, IF I'M NOT MISTAKEN.
UM, KNOWING THAT IN YEAR ONE WE'RE GONNA SPEND 2 MILLION, SO WE'VE GOT 8 MILLION THAT WE'RE INVESTING AND THEN TAKING THE INTEREST OFF OR THE EARNINGS OFF THAT INVESTMENT TO, AND PUT IT ASIDE FOR DEBT SERVICE PAYMENT.
AS WE ISSUE MORE OF THAT AID, YOU KNOW, AND WHITTLE IT DOWN, WE, IT, IT, IT ALMOST ALWAYS HAPPENS THAT WHEN YOU BORROW MONEY, YOU SPEND IT OUT OVER TIME.
THERE ARE A FEW OCCASIONS WHERE YOU BORROW IT AND YOU PAY YOUR, YOU PAY FOR A LAND ACQUISITION AND IT'S ALL GONE.
RIGHT? BUT YOU ARE ABLE TO INVEST THAT MONEY, UM, ACCORDING TO STATE STATUTES, RIGHT? YOU GOTTA INVEST IT LIKE ANY OTHER PUBLIC FUNDS AND, UH, YOU'RE ABLE TO EARN INTEREST ON IT UP TO MORE OR LESS YOUR BORROWING RATE.
SO IF YOU'RE BORROWING AT 3.5%, YOU CAN INVEST AND KEEP THE INTEREST EARNINGS UP TO 3.5%.
BUT IF YOU'RE EARNING 5%, YOU MIGHT HAVE TO RETURN SOME OR ALL OF THAT EXTRA INTEREST TO THE IRS.
SO YOU ARE ABLE TO EARN INTEREST ON THESE BONDS IF THEY'RE TAX EXEMPT, BUT YOU MAY NOT BE ABLE TO KEEP ALL OF THE INTEREST DEPENDING ON HOW QUICKLY YOU SPEND IT AND SOME OTHER CONSIDERATIONS.
UM, BUT YOU'RE RIGHT, IT'S THAT CONCEPT OF ARBITRAGE.
AND, UM, WE WOULD FULLY EXPECT UNDER A CONSTRUCTION PROJECT THAT YOU'LL BORROW MONEY, IT WILL SIT, IT WILL BE INVESTED, AND YOU'LL BE ABLE TO USE THAT INTEREST EARNINGS GENERALLY FOR WHATEVER THE PURPOSE WAS THAT THE BONDS WERE ISSUED.
SO IF YOU'RE BUILDING A FIRE STATION AND YOU, YOU EARN $200,000 IN INTEREST EARNINGS OVER THE CONSTRUCTION PERIOD, YOU, YOU, YOU CAN SPEND THAT MONEY ON THE FIRE STATION OR WHATEVER OTHER QUESTION WAS PUT TO THE VOTERS PUBLIC SAFETY.
UM, YOU DO NEED, I BELIEVE FOR TAX EXEMPT BORROWING, YOU NEED TO HAVE AN EXPECTATION WHEN YOU BORROW THE MONEY THAT YOU HA YOU WILL SPEND THAT MONEY OVER A THREE YEAR PERIOD.
SO YOU'RE, YOU'RE REALLY, THE LGC WILL PRECLUDE YOU FROM DOING SPECULATIVE BORROWING JUST TO, TO INVEST THE FUNDS.
BUT THE TAX EXEMPT LAWS REQUIRE THAT AT THE TIME OF ISSUANCE, YOU HAVE A REASONABLE EXPECTATION TO SPEND THE MONEY IN A THREE YEAR PERIOD.
MANY PEOPLE TAKE LONGER THAN THAT FOR VARIOUS REASONS, BUT AT THE TIME OF BORROWING, THAT'S SOMETHING YOU NEED TO BE PREPARED TO ACKNOWLEDGE, BUT YOU CAN EARN SOME INTEREST.
YOU JUST MAY NOT BE ABLE TO KEEP ALL OF THE INTEREST, DEPENDING ON THE BORROWING RATE OF THE BONDS, HOW QUICKLY YOU SPEND THE MONEY.
UM, THERE'S DIFFERENT CALCULATIONS, BUT SOME OF IT YOU WOULD BE ABLE TO KEEP.
[01:05:04]
ANY OTHER QUESTIONS? OKAY.JOHN, ANYTHING THAT YOU WANTED TO ADD? NO, I JUST, ONE NOTE THAT YOU ALL ARE KIND OF LOOKING AT PROJECTS AND PURPOSES.
UM, WE SEE PEOPLE GO ABOUT THIS DIFFERENT WAY.
SOMETIMES THEY SAY, HERE'S OUR LIST.
HOW WOULD YOU GROUP THESE? UM, SOMETIMES PEOPLE ARE MORE GENERAL, GENERAL, BUT WE'RE HAPPY TO WORK WITH STAFF ON THAT KIND OF THROUGH THIS PROCESS IS YOU KIND OF DEVELOP YOUR LIST AND WE CAN KIND OF PUT OUR BLIND COUNCIL EYES ON IT AND SAY, OKAY, THIS IS A, THIS QUESTION, THIS QUESTION, THIS QUESTION.
AND JUST TO UNDERSCORE THIS POINT THAT TED MADE, WE SEE PEOPLE DO IT DIFFERENT WAYS.
UM, YOU CAN'T BE OVERLY BROAD.
YOU'VE GOTTA FIT WITHIN THOSE PURPOSES.
BUT, YOU KNOW, THESE BONDS ARE GONNA BE OUT THERE FOR SEVEN, MAYBE 10 YEARS.
AND SOMETIMES IT'S IMPORTANT TO KIND OF SPECIFICALLY LIST PROJECTS IN THERE, BUT IT'S GOOD TO HAVE THAT FLEXIBILITY 'CAUSE YOU DON'T KNOW WHAT IT'S GONNA LOOK LIKE FIVE YEARS FROM NOW.
YOU MAY GET A GRANT OUT OF NOWHERE FOR A PROJECT THAT YOU WERE LOOKING AT.
SO WE CAN SHARE SOME EXAMPLES OF STREETS AND SIDEWALKS QUESTIONS OR PARKS AND REC QUESTIONS, UH, KIND OF TYPICAL BALLOT QUESTIONS SO YOU CAN SEE GENERALLY WHAT THAT WOULD LOOK LIKE ON, ON A BALLOT.
THAT WAS JUST MY 2 CENTS ON THAT.
AND MAYOR, IF YOU'D LIKE, WE, WE COULD CERTAINLY SET A, A WORK SESSION DATE IF THE BOARD WOULD LIKE TO, WE COULD DO THIS THE, UH, FIRST MEETING IN, IN AUGUST AT FOUR O'CLOCK IF YOU WOULD LIKE TO.
DOES THE BOARD WANT TO FIGURE IT OUT TODAY OR TAKE A LITTLE TIME? LET'S, WE'LL, WE'LL, WE WILL HAVE TIME TO, TO CALL FOR THAT.
I, I THINK, UH, IF THE CLERK WANTS TO DO WHAT SHE DOES SO WELL IS SEND OUT, UM, SOME OPTIONS MAYBE AND FIND A TIME AND DATE THAT'S APPROPRIATE FOR US.
[2. Discussion of Signs and Markers.]
UP IS ITEM NUMBER TWO.DISCUSSION OF SIGNS AND MARKERS.
ARE WE GONNA TAKE A BREAK? UH, HOW LONG DO YOU THINK? YEAH, I DON'T THINK THIS IS GONNA TAKE LONG.
SO WE WANTED TO BRING TWO ITEMS UP TO YOU, UH, FOR SIGNS AND MARKERS.
UH, RECENTLY STAFF HAD HAD REACHED OUT TO US ABOUT A REQUEST FOR A NEW BERN BEAR.
AND THE BEAR IS PROPOSED BY A BUSINESS LOCATED DOWNTOWN IN FRONT OF THEIR BUSINESS ON CRAVEN STREET.
UH, THE BEAR WOULD BE ON THE SIDEWALK IN THE RIGHT OF WAY.
AND SO WE HAVEN'T HAD A REQUEST FOR THIS.
AND SO WE'RE TREATING THIS KIND OF LIKE, UM, MARKERS AND MONUMENTS, UH, IN THE RIGHT OF WAY.
AND SO WE NEED TO GET A LITTLE DIRECTION, UH, ON, UM, WHAT THE BOARD'S TAKE WAS ON A, ON A BEAR.
CURRENTLY THERE, DOWNTOWN, THERE ARE TWO BEARS IN THE RIGHT OF WAY ON THE SIDEWALK.
AND ONE IS HERE AT CITY HALL AND THE OTHER ONE IS IN FRONT OF MITCHELL'S HARDWARE.
AND ALL OF THOSE ON THE RIGHT CITY'S RIGHT OF WAY.
I KNOW THIS ONE IS, SO THEY'RE LOOKING TO PUT THIS ONE ON THE RIGHT OF WAY? YES, SIR.
THEY'D LIKE TO PUT IT ON THE SIDEWALK, UM, RIGHT AT THE CORNER OF THEIR BUSINESS IN FRONT.
BUT WE ALL, WE HAVE ALREADY MADE OURSELVES CLEAR THAT WE ARE NOT GONNA DO THAT ANYMORE WITH A MARKER.
SO WHAT'S GOING TO GIVE THE DAD A RIGHT TO DO, TO DO SOMETHING THAT WE ALREADY SAID WE ARE NOT GOING TO DO? AND, AND THIS IS WHY WE'RE BRINGING IT UP.
WE, WE RECEIVED A REQUEST AND SO WE, ANY, ANY REQUEST WE GET, WE'RE GONNA, WE'RE GONNA LET THE BOARD BE AWARE OF IT.
SO WHERE IS IT? THEY WANT TO PUT IT AGAIN.
THIS IS AT, UM, 2 0 6 CRAVEN STREET.
SO IT'S RIGHT DOWN THE STREET HERE ON THE LEFT HAND SIDE OF THE ROAD.
AND THE INFORMATION DID NOT HAVE THE NAME OF THE BUSINESS THAT THE DEVELOPMENT SERVICES FORWARDED TO US.
SO IN THE, IN THE PAST, THE ONES THAT HAVE BEEN ESTABLISHED ALREADY, THAT WHAT, WE DIDN'T HAVE A POLICY OR PROCEDURE.
SO THAT WAS A STAFF, I'M ASSUMING IT WAS BEFORE YOUR TIME.
I'M ASSUMING IT WAS A STAFF DECISION.
SO I'M, I'M NOT AWARE DURING MY TIME OF, OF A BEAR REQUEST IN THE RIGHT OF WAY BEING COMING TO THE BOARD AND THE CLERK MAY, MAY WANT TO TALK TO THAT.
NO, THEY WERE FIRST PUT OUT, IF YOU REMEMBER, IN 2010 AS PART OF THE 300 CELEBRATION.
AND AFTER THE CELEBRATION, A LOT OF THEM WERE RELOCATED.
UM, THERE WERE JUST A FEW THAT WERE PUT IN THE RIGHT OF WAY.
AND THAT DID NOT COME BEFORE THE BOARD AT THAT TIME BECAUSE THERE WASN'T A POLICY.
IT WAS JUST PUT THERE, THERE WASN'T A POLICY.
UM, SO ARE YOU ASKING SPECIFICALLY ABOUT THIS ONE OR BEARS OVERALL? 'CAUSE THAT'S A PRETTY ROBUST PROGRAM THROUGHOUT THE CITY.
UM, I GUESS IT, THIS KIND OF GOES BACK TO THE, UM,
[01:10:01]
THE SIDEWALK CAFE ISSUE.WHENEVER THAT CAME UP, SOME FOLKS THROUGHOUT THE CITY SAID, WELL, YOU KNOW, I WANT TO HAVE, UH, DINING IN MY, ON MY SIDEWALK IN MY PARKING LOT AND I DON'T, I'M NOT DOWNTOWN.
AND WE TOLD 'EM, WELL, THAT'S FINE, IT'S PRIVATE PROPERTY.
HERE IS WHEN YOU WALK OUTSIDE OF YOUR FRONT DOOR, YOU'RE ESSENTIALLY ON PUBLIC PROPERTY.
AND THAT'S WHY DOWNTOWN IS VIEWED A LITTLE BIT DIFFERENTLY.
UM, I GUESS THE BOARD NEEDS TO DECIDE IF WE WANNA STICK WITH THE DECISION WE'VE MADE ABOUT NO MONUMENTS, INCLUDING THIS WOULD INCLUDE BEARS ON PUBLIC PROPERTY RIGHT AWAY, UM, OR IF THERE'S APPETITE FOR THE BOARD TO HAVE AN EXCEPTION FOR BEARS, SINCE THAT'S A PROGRAM THAT'S BEEN AROUND SINCE THE 300 CELEBRATION.
SO DOES ANYBODY ELSE, THE RIGHT OF WAY IS THE RIGHT OF WAY AND WE MADE A DECISION SO WE SHOULD STICK TO WHAT WE SAID WE ARE GOING TO DO.
I THINK THAT WOULD BE THE RIGHT THING TO DO.
THEREFORE, NO ONE WOULD FEEL SLIGHTED.
WHERE DO THEY WANT TO INSTALL MS BEAR? THIS IS ON THE SIDEWALK AT 2 0 6 CRAVEN STREET ON THE SIDEWALK.
RIGHT, RIGHT, RIGHT IN FRONT OF THEIR BUILDING.
IS THERE ANY OTHER BEARS, IS THERE ANY OTHER BEARS POSITION LIKE THAT THROUGHOUT THE CITY IN FRONT OF A BUSINESS LIKE THAT? ACROSS THE STREET AT MITCHELL'S HARDWARE.
THERE'S ONE AND THEN RIGHT HERE AT CITY HALL, UH, AT THE STEPS.
I'M NOT AWARE OF ANY OTHERS THAT ARE IN A RIGHT OF WAY THROUGHOUT THE CITY ABOUT THE BEAR THAT GOT STOLEN.
THAT GOT REPLACED RIGHT ACROSS HERE AT THE TOURIST SHOP.
I'M PRETTY SURE THAT'S, AND THEN THERE'S ALSO ONE, THE BAY OF THE, THE, THE, THE STUFFED BEAR IS THAT IT'S A WOOD BEAR.
AND THEN THERE'S ONE IN FRONT OF THE CUB HOUSE, THE PIEDMONT NATURAL GAS BEAR BY
THE BEARS WERE AT THE PARKS THERE, THERE ARE TWO BEARS AT THE PARK AND THEN THE ONE IN THE CUB HOUSE, I CAN'T REMEMBER IF THE CUB HOUSE.
DID YOU SAY THAT WAS PIEDMONT NATURAL GAS? NO, PIEDMONT NATURAL GAS IS IS BY, UM, THE MARRIOTT AND THE PARK.
THIS ONE OVER HERE WAS THE WELCOME WAGON WELCOME COMMITTEE.
WOULDN'T IT MAKE A DIFFERENCE AS HOW THE STORE IS, IS SITUATED? I MEAN, IF THEY HAVE A, WHAT WOULD IT BE CALLED? AN ALCOVE OR SOMETHING LIKE THAT WHERE YOU COULD, AND IF THE BARREL WAS GONNA BE PLACED IN THAT AREA, IT MIGHT MAKE A DIFFERENCE.
AND THEN JUST SITTING ON THE SIDEWALK, THIS STORY QUESTION DOES NOT HAVE AN ALCOVE OR ANYTHING LIKE THAT.
SO IT WOULD BE JUST IN FRONT OF THE STORE ON THE SIDEWALK? THAT'S CORRECT.
THE ONE AT MITCHELL, I CAN'T RECALL.
IS IT, IS IT IN AN ALCOVE OR IT'S, IT IT IS ON THE, IT IS ON THE CORNER OF THE BUILDING RIGHT BEFORE THE PARKING LOT.
WELL MY TAKE ON IT AGAIN IS IF WE RELAX THE RULES FOR SOME THEN WE ARE FACED WITH THE CHALLENGE OF OTHER PEOPLE WHO AGAIN, WOULD WANT THE SAME THING.
AND HOW CAN WE DISCRIMINATE TO SAY, WELL, WE ALLOWED IT FOR THIS ONE, BUT WE CAN'T ALLOW IT FOR THAT.
THEN WE LOOKED AT THE PAST WHEN THIS POLICY WAS ENACTED, IT WAS BECAUSE OF THESE SITUATIONS AND WE HAVE DENIED PEOPLE SINCE THAT TIME OF HAVING THE ABILITY TO U UTILIZE THE RIGHT OF WAY.
SO IF THERE'S AN EXCEPTION FOR ONE AS IMPORTANT AS THEY FEEL THIS IS, THEN FOR OTHER FOLKS WHO FEEL IT IS EQUALLY IMPORTANT FOR WHATEVER THEY WANT TO MONUMENT A BEAR OR STATUE OR WHATEVER IT IS, THEN THERE GOES THE POLICY SOYA THE BEAR CAN BE PLACED ON PRIVATE PROPERTY.
AND ANY OTHER TYPE OF MARKERS, BLACK SWEATER, THEY MIGHT HAVE TO PUT THE BEAR INSIDE THE STORE AT THE WINDOW.
THE, UM, I, I GUESS THE ONLY THING THAT I WOULD OFFER IS BEING IN THAT MEETING WITH SOMEONE WHO MADE A REQUEST POST THE DECISION OF THIS BOARD NOT TO ALLOW THESE AND THEY POINT BACK TO OTHER SITUATIONS WHERE THE CITY DID ALLOW IT IN THE PAST.
I THINK WE, I'M, I'M, I'M GONNA GO ALONG WITH WHETHER THE MAJORITY OF THE BOARD SAYS, BUT I THINK WE JUST NEED TO BE PREPARED BECAUSE IF I WAS THIS BUSINESS AND I WANTED TO HAVE A BEAR IN FRONT OF MY BUSINESS AND A BUSINESS RIGHT ACROSS THE STREET HAS ONE THAT THEY WERE ALLOWED TO HAVE, THAT GETS BACK TO THAT QUESTION OF WHY ARE THEY ALLOWED TO HAVE ONE? AND ME NOT.
AND I UNDERSTAND THE TIMING THAT WAS DONE BEFORE THERE WAS ANY DECISION MADE BY ANY GOVERNING BODY, BUT IT, IT IS TRICKY.
[01:15:01]
THIS IS PROBABLY WHY YOU OFFERED TO HAVE A POLICY PUT IN PLACE A WHILE BACK THAT WE DECLINED NOT TO TAKE UP.BUT, UM, SO I I'VE HEARD TWO, I THINK TWO NOS FOR SURE.
ANYBODY ELSE FROM THE CHIME? DID YOU JUST SAY WE DECLINED NOT TO PUT A POLICY IN PLACE? YEAH, THE MAN, THE MANAGER PRESENTED A POLICY AND WE DECIDED THAT WE DIDN'T WANT TO ADOPT A POLICY.
WE JUST SAID THAT IF ANYBODY HAD A REQUEST, THEY WOULD BRING THEM UP INDIVIDUALLY.
SO THERE'S STILL AN OPPORTUNITY.
I'M SURE STAFF WOULD APPRECIATE HAVING A POLICY.
SO EVERY TIME SOMEBODY MAKES A REQUEST, THEY WOULDN'T HAVE TO BRING IT BECAUSE WE COULD SAY FOR, CORRECT ME IF I'M WRONG, BUT IF WE SAY NO TO THIS BEAR ON CRAVEN STREET IN TWO MONTHS, IF SOMEBODY SAYS, I WANT TO PUT A BEAR ON P*****K STREET BEING, WE DON'T HAVE A POLICY, YOUR DIRECTION FROM THIS BOARD WAS TO BRING IT BACK TO US AGAIN, WE'RE COMING BACK TO YOU.
AND THE REASON FOR THAT WAS TO MAKE EXCEPTIONS.
IF WE PUT A POLICY IN PLACE, THEN AS THE MAYOR SAID, WE DON'T HAVE TO HAVE THESE CONSIDERATIONS AND DISCUSSIONS EVERY OTHER WEEK.
MY DI MY DIRECTION OR HOPE WOULD BE IS THAT WE COULD GET A POLICY PUT ON OUR NEXT AGENDA FOR US TO CONSIDER.
THAT WAY WE CAN KIND OF PUT THIS TO REST.
FOSTER, I DON'T KNOW WHETHER THIS IS VIABLE OPTION FOR THE PROPERTY OWNER ON CRAVEN, BUT IF THEY HAVE THE ABILITY TO ELEVATE THE BEAR ON A PLATFORM ATTACHED TO THEIR BUILDING THAT IS HIGH ENOUGH THAT IT'S NOT GONNA BE AN IMPEDIMENT TO PEDESTRIANS, IS THAT, IS THAT AN OPTION THAT, UM, WE WOULD ACCEPT OR WOULD IT NOT EVEN APPLY COME TO US VE SINCE IT'S ATTACHED TO THEIR BUILDING? THAT THAT'S CORRECT.
OTTERMAN ASKED THAT THAT WOULD BE SOMETHING FOR HPC TO, TO LOOK AT TO SEE IF THAT WAS APPROPRIATE OR NOT.
AND THERE WAS, THERE WAS AN ISSUE ABOUT A SIDEWALK ENCROACHMENT.
'CAUSE I, I THINK CAPTAIN RATS WANTED TO EXTEND OUT OVER THE SIDEWALK AND IT WAS GONNA HAVE TO HAVE SUPPORT COLUMNS AND THAT WAS SHOT DOWN.
SO WELL THE HPC DOESN'T REGULATE THE STATUTE, DO THEY? I DIDN'T THINK THEY REGULATED STATUTES.
THEY, WELL, THEY HAVE THEIR APPEARANCE GUIDELINES THAT THEY, WITH THIS POLICY IN PLACE, I THINK WE SHOULD PUT A POLICY IN PLACE ALSO, BARBARA.
THAT WAY IT GIVES STAFF DIRECTION FIVE FIVE.
SO IF THAT LADY PUTS THE BEAR DOWN, THAT LADY SHOULD BE ABLE TO PUT HER MARKER DOWN.
YEAH, WE'RE NOT, WE'RE JUST SAYING WE GONNA PUT A POLICY IN PLACE SO WE WON'T HAVE TO I UNDERSTAND THAT AND SHE CAN'T, I WAS JUST MAKING, I WAS JUST MAKING A BRIEF STATEMENT AND SHE CAN'T DO ANYTHING RIGHT NOW.
SO WE WILL PLAN ON BRINGING A POST POLICY BACK TO THE NEXT MEETING BASED ON THE DIRECTION WE'VE GOT.
I'LL GO AHEAD AND, AND, AND UPDATE YOU ON THE OTHER THING.
AR PUT SOMETHING IN FRONT OF, OF YOU, UM, THIS IS REGARDING THE AFRICAN AMERICAN HISTORICAL SIGNS BACK IN JUNE OF 2021.
MARKERS WERE PLACED, UM, IN THE RIGHT OF WAY AND ON PRIVATE PROPERTY.
THERE ARE CURRENTLY SIX IN THE CITY RIGHT OF WAY AND FOUR ON PRIVATE PROPERTY.
AND THIS WAS A PARTNERSHIP WITH THE, THE HOUSING AUTHORITY.
UM, DUFF FIELD, I THINK DUFFY FIELD, PHOENIX GROUP, THE DUFFY FIELD RESIDENCE COUNCIL, SEVERAL GROUPS THAT WERE INVOLVED WITH THIS BACK IN 2021.
UH, ALSO THE FORMER DIRECTOR OF DEVELOPMENT SERVICES WORK WORKED ON THIS TO PLACE THOSE MARKERS.
AND YOU'RE GONNA SEE A, A LETTER IN FRONT OF YOU, I THINK IT WAS DATED AUGUST OF 2021 THAT WAS SENT TO THE BOARD AT THE TIME.
AND BERNARD GEORGE MADE A PRESENTATION TO THAT BOARD ON SEPTEMBER 28TH, 2021 ON BEHALF OF THE COMMITTEE TO MAKE A, UM, A REQUEST THAT THE CITY TAKE OWNERSHIP OF THOSE SIGNS AND, AND, AND TAKE CARE OF THE MAINTENANCE OF THOSE SIGNS.
AND SO THE DIRECTION THAT WE GOT FROM THE BOARD AT THAT TIME WAS FOR STAFF IN THAT COMMUNITY TO GET TOGETHER TO DISCUSS THE, THE BEARS THAT WERE IN THE RIGHT OF WAY TO SEE IF THEY COULD BE RELOCATED.
AND THEN TO COME BACK TO THE BOARD, UH, FOR THAT BOARD TO CONSIDER.
THIS REALLY DID FALL OFF THE RADAR.
WE HAD SEVERAL STAFF CHANGES, UH, IN THE RESEARCH WE'VE DONE.
THE COMMITTEE NEVER MET WITH STAFF AFTER THAT.
AND THIS REALLY JUST CAME UP A FEW WEEKS AGO WHEN WE WERE HAVING A DISCUSSION, UH, WITH SOME FOLKS ABOUT THE OTHER HISTORICAL MARKER.
AND SO CAROL BECKTON ACTUALLY SAID SOMETHING TO ME ABOUT THE STATUS OF THIS.
AND SO I THOUGHT, WELL, WE NEED TO BRING THIS UP TO THE BOARD.
AND SO MARVIN, I'LL LET YOU GO AHEAD AND TALK A LITTLE BIT ABOUT, UH, UH, WHAT YOU PUT ON THEIR TABLES.
ALRIGHT? YEAH, BASICALLY WHAT YOU HAVE THERE, UH, THERE'S 10 SIGNS AND THE ONES THAT HAVE THE RED THAT SHOWS PRIVATE ARE THE ONES THAT ARE CURRENTLY ON PRIVATE PROPERTY.
[01:20:01]
UH, UH, THE, THE FOUR OF 'EM THAT ARE ON PRIVATE PROPERTY, THOSE ARE THE ONES, YOU CAN SEE WHERE THE LOCATIONS ARE ON ONE.AND THEN THE, UM, GIS LOCATION, BASICALLY THE BEST WE COULD DO TO SHOW YOU ALL THAT THEY ARE BARELY, UH, ON THE PRIVATE PROPERTY, JUST OFF OF THE RIGHT OF WAY.
SO THE QUESTION THAT WE, UH, RAN INTO IS, UH, I THINK THE QUESTION IS, ARE WE GOING TO MAINTAIN THE ONES THAT ARE ON PRIVATE PROPERTY OR WE GOING TO, UH, LOOK TO HAVE THEM MOVED OFF OF THE PRIVATE PROPERTY ONTO OUR RIGHT OF WAY AND MAINTAIN IT? SO, UH, JUST LOOKING FOR SOME GUIDANCE AS TO WHAT IT IS WE WANT TO DO BECAUSE, UH, ACCORDING TO BERNARD GEORGE AND AND HIS COMMITTEE, THEIR UNDERSTANDING WAS THAT THEY GAVE THEM TO THE CITY AND THE CITY WAS GONNA MAINTAIN THEM.
BUT, UM, THAT WASN'T THE, THE BOARD'S DECISION.
WE HAVE NOT ACCEPTED OWNERSHIP OF ANYTHING.
WE HAVE NOT ACCEPTED OWNERSHIP, THANK YOU.
SO THE, THE QUESTION'S GONNA BE, DOES THE CITY WANT TO CONSIDER OWNERSHIP OF THIS? NOW THE BOARD ALSO DID NOT, AT THAT TIME, DID NOT APPROVE THESE THINGS BEING PUT IN THE RIGHT WAY.
IT WAS MORE STAFF DRIVEN FOR THAT.
AND I THINK SOME BOARD MEMBERS WERE INVOLVED WITH THE PROCESS OF ALONG THE WAY AS WELL.
UH, I ALSO WANTED TO ADD THAT, UM, FROM A LEGAL PERSPECTIVE, OUR ATTORNEY, AND I THINK THE REASON THIS GOT QUOTE UNQUOTE KICKED DOWN THE ROAD IS THE ONES THAT ARE ON PRIVATE PROPERTY.
IF THE CITY WERE TO TAKE THOSE OVER, WE WERE GONNA HAVE TO WORK ON GETTING AN EASEMENT WITH THOSE PROPERTY OWNERS.
AND THE ATTORNEY SAID THAT WAS VERY TIME CONSUMING, UM, NOT COST EFFECTIVE.
SO THAT'S THE REASON THE PREVIOUS BOARD SAID, GO FIGURE OUT THESE FOUR THAT ARE ON PRIVATE PROPERTY, THEN COME BACK TO US AND LET'S HAVE THAT DISCUSSION.
AND LIKE YOU SAID THAT THAT NEVER HAPPENED.
SO I THINK THERE IS SOME THAT ARE ALREADY DAMAGED.
THERE ARE TWO OVER ON, UH, RIGHT.
IT IS A, IT IS A TRIPOD ONE THAT HAS TWO THAT ARE CURRENTLY DAMAGED THAT WILL HAVE TO BE, UH, FIXED.
AND THAT WAS THE OTHER CONCERN WAS WHO'S RESPONSIBLE FOR THE DAMAGED ONES? UM, OH, SEE THE STREET IS NOT LISTED ON THIS LIST.
IT'S THE, UM, WEST, IS IT WEST STREET? UH, THE, UH, CRAIG, WHAT WAS THAT? THE CRAVEN TERRACE? SORRY.
CRAVEN TERRACE HOUSING NUMBER THREE, TWO OF THOSE WERE DAMAGED.
WHAT IS THE, WHAT WOULD THE COST BE IN MAINTENANCE AND DOING SOMETHING LIKE THAT? SO ALL WE KNOW IS BASED ON THE LETTER THAT YOU HAVE IN FRONT OF YOU, THAT THE, ALL 10 OF THOSE SIGNS COST ABOUT $35,000.
SO WHAT THOSE INDIVIDUAL PANELS WOULD BE, COULD NOT ANSWER THAT.
WE'D HAVE TO ACTUALLY REACH OUT TO, TO THE MANUFACTURER OF THAT, SEE WHAT THOSE GONNA COST.
BUT IT'S PROBABLY GONNA BE FIVE OR $600 A PANEL EASILY.
GIFTS ARE VERY EXPENSIVE, AREN'T THEY? YES, SIR.
THEY'RE THOSE AREN'T, THEY'RE, THEY'RE LIKE METAL SIGNS, PROBABLY LIKE DIGITAL, DIGITAL TYPE.
SO IT'S NOT LIKE A WOODEN SIGN THAT'S GONNA WEAR OUT ANYTHING THAT OVER TIME MAY FADE.
BUT, UH, THE DAMAGE THAT ARE TO THE TWO THAT, THAT, THAT ARE DOWN, UM, IT APPEARS THAT SOMEONE, UH, DAMAGED IT BY HITTING THE SIGN AND DENTING THEM UP.
SO, SO I CAN'T THESE I'M SORRY, GO AHEAD.
SO WHY CAN'T THESE, UM, DIFFERENT, UM, ENTITIES HERE APPLY FOR SOME GRANTS TO, TO MAINTAIN THESE SIGNS? I BELIEVE THAT THE ORIGINAL PURCHASE WAS THROUGH GRANTS.
AND THEN FROM MY UNDERSTANDING THERE, THIS, THIS GROUP, I DON'T, I DO NOT BELIEVE THEY ACTUALLY STILL EXIST AS A GROUP.
I THINK, UH, WHEN THEY, WHEN THEY CAME TOGETHER, UM, AS THE NEWBURN AFRICAN AMERICAN SIGNS OF RIGHT HISTORY COMMITTEE AND THEN AFTER THEY FINALIZED THE, THE TURNOVER IN THEIR MINDS, I, I DON'T BELIEVE THE GROUP STILL EXISTS.
IS IS ANYONE ON THIS BOARD A MEMBER OF THE AFRICAN AMERICAN HERITAGE MUSEUM BOARD? THAT THAT MAY BE AN OPTION.
WE COULD WORK WITH THEM, UM, TO SEE IF THEY HAVE AN INTEREST.
I MEAN, I KNOW THAT THEY'RE VERY ENGAGED WITH PROMOTING THE HISTORY IN THE CITY.
MAYBE IT'S A PROJECT, UM, IN PERPETUITY.
KINDA LIKE WE HAD TALKED ABOUT EARLIER.
MAYBE THERE'S SOME NONPROFITS THAT WOULD LIKE TO HAVE A PARK THAT THEY WOULD LIKE TO TAKE OVER AND HAVE NAMING RIGHTS FOR.
MAYBE IT'S WORTH A CONVERSATION
[01:25:01]
WITH THAT GROUP JUST TO SEE IF THEY HAVE ANY INTEREST AT ALL IN TAKING OWNERSHIP AND MAINTENANCE OF THE SIGNS.MY, MY STANCE FOR, FROM, FROM RIGHT NOW, MY STANCE WOULD BE AN ABSOLUTE NO ON THE ONES ON PRIVATE PROPERTY.
I DON'T THINK THAT THAT WOULD BE SOMETHING WE WOULD EVEN WANT TO CONSIDER THE ONES ON PUBLIC PROPERTY.
IT'S PROBABLY WORTH MORE CONVERSATION AND DISCUSSION, BUT DEFINITELY NOT THE ONES ON PRIVATE PROPERTY.
BECAUSE YOU ASKING FOR TROUBLE THERE, YOU HAVE TO GO AHEAD AND GET AN EASEMENT.
IF A TRUCK GOES UP THERE AND IT'S TOO HEAVY, DOES SOMETHING TO THE YARD.
I MEAN, HE, HE GOT, IT'S A LOT TO GO ON THERE.
ALL THIS HAS TO BE RETHOUGHT OUT.
DOES ANYBODY OPPOSED TO STAFF REACHING OUT TO THE AFRICAN AMERICAN HERITAGE MUSEUM BOARD TO SEE IF THEY HAVE ANY INTEREST? NO, THIS WAS STAR THIS A START.
AND IF THEY SAY YES, THEN GREAT PROBLEM SOLVED.
IF THEY SAY NO, THEN WE WILL JUST HAVE TO REVISIT, COME UP WITH AN ANSWER WITH A PLAN.
AND SO THERE, THERE ARE QUITE A FEW SIGNS IN CITY RIGHT OF PLACE THAT WE DON'T MAINTAIN AND THERE ARE SIGNS THAT WE MAY OWN THAT WE'VE HAD FOR YEARS THAT IF IT'S DAMAGED, A LOT OF THEM DON'T GET REPLACED FOR ONE REASON OR ANOTHER.
E EVEN IF THE CITY, UH, DECIDED THEY WANTED TO TAKE OWNERSHIP OF THIS, THERE, YOU'RE NOT OBLIGATED, THE CITY'S NOT OBLIGATED TO MAINTAIN THOSE THINGS.
I DON'T THINK THAT'S A, UM, A HOBBY WE WANT TO GET INVOLVED WITH.
UM, BOARD, IF YOU'RE READY, WE CAN ADJOURN THIS MEETING AND THEN WE'LL BE BACK AT SIX O'CLOCK FOR OUR REGULAR MEETING.
SO I NEED A MOTION, A MOVE, SECOND MOTION AND A SECOND.
ANY FURTHER DISCUSSION? HEARING NONE.