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I CABARRUS COUNTYI <br /> NO,Tit CAROLIN~ <br /> <br />MEMORANDUM <br /> <br />December Agenda <br /> <br />To: Board of Commissioners <br /> <br />Date: December 10, 2001 <br /> <br />2002 Financing Proposals <br />Education Facilities Funding Options <br /> <br />Per direction given by the County Commission at its work session held December 3ra with the <br />Board of Education, staff has developed several facility/funding proposals. It has been <br />previously established by the County Commission that during calendar year 2002, the County ~ <br />would pursue $10,000,000 financing associated with the Expo project. This was to be a bank <br />qualified financing with relatively small processing costs as authorized by IRS regulations. <br /> <br />However, pursuing the facilities and associated financing requested by the Board of Education <br />rules out bank qualified financing as an option and will require C.O.P.s financing instead. It may <br />also make sense to increase the proposed Expo financing to $15 million to allow more flexibility <br />regarding adjusting the tax rate to reflect the added debt service associated with the proposed <br />educational facilities/funding. <br /> <br />Detailed financial projections are provided for each of the 16 separate scenarios (1-16). <br />However, note that scenarios 9-16 are the same as scenarios 1-8 except that debt service is for 25 <br />years versus 20. <br /> <br />Scenario (t and 2), (3 and 4), (5 and 6) and (7 and 8) are also similar except that Expo financing <br />is increased fi:om $10 million to $15 million. <br /> <br />Debt service in each scenario is planned around a July 2002 sale of debt with only one debt <br />service payment to be made in FY 03 (July 1; 2002 thru June 30, 2003). Full annual debt service <br />payments would begin in FY 04 (July 1, 2003 thru June 30, 2004). <br /> <br />A final note, please remember the North Carolina legislature has given you the task of addressing <br />the 1/2¢ local sales tax option prior to July 2003. In July 2003 the County will cease to receive <br />State reimbursable funds in the amount of $3.8 million annually. Those revenues will have to be <br />replaced by local property taxes, other revenue growth (if any), a reduction in specific program <br />funding, or enactment of the local option 1/2¢ sales tax (actually, a continuation of the State 1/2¢ <br />enacted during the 2001 General Assembly). <br /> <br /> Office of the County Manager <br />P.O. Box 707' · Concord, NC 28026-0707 · 704-920-2100 · Fax 704-920-2820 · Charlotte 704-375-0829 <br />www,co.cabarrus.nc.us <br /> <br /> <br />