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A Learning Session

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A recurring theme in the discussions was the county’s wish to turn more citizens into taxpayers, as opposed to tax consumers. With Commissioner Holly Jones absent, Ellen Frost took a lead role in the conversations. She observed, “Low-paying jobs cost county taxpayers lots of money,” and expressed frustration that the county’s two largest economic sectors “create these horrible wages that create these horrible statistics.”

Later on in the conversations, Assistant County Manager Mandy Stone advocated universal Pre-K education, saying students who complete its programming are, “more likely to make a living wage without needing government assistance.” Chair David Gantt asked, perhaps rhetorically, what the cost was of not paying a living wage.

County government can control what it pays its employees, and it can choose not to do business with contractors who do not pay living wage; but it does not have the power to dictate to private industry what must be paid. The commissioners were therefore entertaining ideas about an economic development incentives program for small businesses that pay a living wage. The county already plans to pay out $5.25 million in inducements to Nypro, New Belgium, Borg Warner, GE Aviation, Kearfott, Highland Brewery, Wicked Weed, and Linamar. Commissioner Miranda DeBruhl stood up for small business owners, saying if they have to pay higher wages, something somewhere else must break to make ends meet.

Fryar has mixed feelings about corporate welfare. It is the way big job-creators do business these days. He described the practice as a “double-edged sword.” He said he tried as hard as he could to find a reason to deny GE their ask, but in the end, “I couldn’t talk myself into saying no and sending 300 jobs elsewhere.” Fryar feels obligated to do whatever he can to keep jobs in this county until the practice is stopped at the state and federal levels.

To pay for commissioner wishes, the idea of a bond referendum was stressed. Currently, each cent, per $100 valuation, in the county’s 60.4-cent property tax rate brings county government $2.9 million directly. So, according to Greene, a one-cent tax increase would cost a person living in a nice home about $25 per year, but it would represent “$34 million in borrowing power on a 20-year loan at 6 percent interest.” To add a sense of urgency, Greene added that the General Assembly only allows votes in even-numbered years.

Fryar reiterated he was looking out for the taxpayer. “Several county residents are on fixed incomes, and many more have not received pay raises in years.” Even county employees feel underpaid, and rightly so. Fryar therefore encouraged his peers to differentiate between wants and needs and think twice before reaching into the pockets of the poor.

According to data presented by Greene, median household income for the county is around $45,000, while the median income for a single person is just shy of $26,000. The average wage was just below $38,000. Calculations for the living wage just happened to match the median wage of $12.50/hour or $11.00/hour with healthcare.

Among projects on the “wish list” that would add to general fund expenditures is enhanced participation in the creation of affordable housing stock. It is estimated that, by 2020, the county will need 457 and 259 new units, respectively, of affordable and workforce apartments; and it will need 378 and 380 units of affordable and workforce housing. Median market rent for a one-bedroom unit in Buncombe County is $830; two-bedroom flats go at a median cost of $916. Applying liberal standards to evaluate housing as a percentage of income; 44.5 percent of Buncombe County renters and 26.0 percent of homeowners are considered Cost-Burdened. 21.7 percent of renters and 9.9 percent of homeowners are Severe Cost-Burdened.

The commissioners were told the county has invested $8.4 million in the creation of affordable housing. Since, in the words of comedian Dennis Miller, “everybody’s matching these days,” the $8.4 million leveraged $103 million from other funding sources. Tools already used by the county include fee rebates, low-interest loans, rental assistance, down-payment assistance, emergency repairs, assistance for county employees, and offering county land for affordable housing projects. Ideas floated for increasing affordable housing stock included housing bonds, a one-cent tax increase, increasing the general fund appropriation, providing incentives to developers, forging new partnerships, modifying zoning to offer density bonuses, and donating more county land for affordable housing.

Fryar thought many of the county’s progressive ambitions were working at cross purposes to growing the affordable housing supply. He told how a lot of land in his district, District 2, is government land, and therefore not available for affordable housing projects. A lot of the rest of it is mountainous, and the county has enacted steep-slope and ridge-top ordinances. While not banning construction on slopes, the rules made it financially infeasible for low-income families, as they now require things like land disturbing permits and geotechnical surveys.

Then, the county keeps spending taxpayer dollars to buy up land for conservation easements. Fryar said he is not wholly opposed to conservation easements, but removing plats from the available pool of buildable land leaves fewer buildable plats, and everybody knows what scarcity does to pricing. Fryar added the affordable housing the county is creating, if subsidized, will only be affordable until it changes hands – unless the county wants to enact rent controls, which have a track record of not working that well to mitigate affordable housing shortages, either.

Another proposed justification for a bond referendum was beginning a universal Pre-K program. Stone argued Pre-K differs from normal child care in that it focuses on school readiness, targets children about to start kindergarten, is “governed by high program standards,” and requires teachers to be certified and licensed. Pre-K in North Carolina was initially designed for children with a “documented risk factor” and/or living in families earning below 75 percent of the state median income.

Stone said the county could start a pilot program targeting high-risk, low-income children. Following the public school calendar, the program would cost $145,989 – $1.3 million, depending on participation. If the pilot were to be offered five days a week, year-round, the cost could exceed $2 million. Stone only provided visuals for a school-calendar option for a universal Pre-K program. If 75 percent of three- and four-year-olds in the county were to participate, it would cost $30.2 to $43.3 million. She argued Pre-K would have an 800 percent ROI, as it would, “develop citizens who pay more taxes and are less likely to rely on the system for support.”

A third thing that could be done with bond funds would be greenway construction. The county’s Greenways Master Plan, adopted in 2012, called for 102 miles of greenway with no dedicated source of funding. Estimates for the proposed 191/Bent Creek greenway are coming in at $1.2 million per mile. But building greenways is just the tip of the iceberg. In order to round up financial partners, they also require a plan, a feasibility study, preliminary engineering, and land acquisitions. And these steps are complicated with environmental impact responses, ADA requirements, public processes with set timelines, and public opposition.

None of the greenways in the master plan are sufficiently planned to qualify for TDA funding, which would then require a 50 percent match. Any other grantor would probably want a county match at some level as well. Then, greenways don’t exactly qualify for sales tax funding. A bond referendum, however, could finance multiple projects in multiple categories. By not having to specify specific projects, the county could, for example, move forward with a different greenway if the targeted one hits a roadblock. It was assumed an annual county allocation of $500,000 could be used to leverage significant partnerships.

On TDA funds, Fryar said he supported the increase in room taxes because it collected revenue from out-of-town visitors. He liked how the TDA paid for ball fields and soccer fields, as he thought they provided good opportunities for kids and brought in tourism dollars. Now, the city wants to use the funding for sidewalks, but they have a reputation for, “pouring a sidewalk, putting trees in the middle of them, whose roots tear up the sidewalk requiring the trees to be cut down, and the sidewalks replaced again.”

Yet another project in need of funding is the expansion of the county’s solid waste facility. Future construction is estimated at $50 million. But rather than throwing landfill costs into a bond referendum, Assistant Manager Jon Creighton is proposing levying a countywide household solid waste fee of $18. The levy would be collected with residents’ tax bills, and it would help the county establish a steady source of income to help maintain its AAA bond rating.

Along with the wishes, the county budget was thrown an $8,590,000 obligation in 2015 when legal counsel’s recommendation to settle a wrongful convictions case was taken. Five men, each of whom served 6-11 years in prison, were deemed innocent, having been incriminated under coercive interrogation. Greene said the decision to settle had been “solid,” the cost of losing the cases being even more astronomical.

Greene had initially appropriated $9,643,213 from the county’s $76,959,661 fund balance to avoid raising taxes last year. Due to construction delays, she was able to borrow $2 million from a fund set aside for the urban renewal project at Eagle Market Street, but that’s $2 million that will have to be replaced at some point. Greene usually uses a portion of the fund balance, which typically runs around $70,000,000, to balance the budget, and then reimburses the fund balance with savings accrued throughout the year. This year, Fryar said Greene was not optimistic about being able to make the fund balance whole. It will depend on how many other things the commissioners want to add to the budget. He described her job as “working as best as she can to pacify everyone.”

The state requires 8 percent of general fund expenditures to be retained in fund balance, but the county has a more-restrictive, self-imposed standard of 15 percent. With a continuation budget totaling $308,356,732, the county would have taken $19,570,770 from the fund balance, leaving it at $57,388,891, or 18.6 percent of general fund expenditures. Other off-budget draw-downs included a $5000 affordable housing summit, $10,000 for the ABCCM Veterans Treatment Court, $37,500 for the Ridgeview Farms Conservation Easement, and $119,925 to help the Health and Human Services Department keep pace with changing federal guidelines.

At their next budget retreat, to be held in March, the commissioners will review the county’s proposed capital plan. Under construction are the Comprehensive Care Center, the Family Justice Center, the Coxe Avenue HHS building that includes a new parking deck, an indoor firing range, a covered pool, IT upgrades, and many new buildings for AB Tech.

The commissioners will also discuss “community development” funding requests. In former years, this had been known as outside agency funding. This is an opportunity for nonprofits to solicit partnerships with taxpayers via the county coffers. Fryar said his preferred method of deciding which agencies get funded is to consider which programs are addressing problems the county would otherwise have to pick up. And then, he only votes for those projects.

Fryar said he has been sympathetic in the past with groups that wanted help with reasonable community needs, but there are a few groups who stay on the dole once their initial problems are solved. He has a heart for helping struggling members of the community, but he doesn’t share the attraction of his peers to giving taxpayer money endlessly to the arts. He said last year, Greene said she could manage giving $1.9 million to outside agencies this year, but now that number is up to $2.6 million.

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