CIP Funds Fall
Published 4:49 pm Thursday, March 21, 2013
CUMBERLAND – Maintaining the County's aging safety equipment by “limping along” and “putting Band-Aids on it,” with a hope they'll function as long as possible, seems to be a likely strategy as the Cumberland Board of Supervisors prepare to vote on the budget and Capital Improvement Program for the upcoming fiscal year.
Funding of Cumberland County's Capitol Improvement Program (CIP) has been dropping over the past four years, while the amount needed to fund the approved plan has been rising.
While the board has not yet voted on this year's budget or CIP five-year plan, according to the budget synopsis submitted to The Herald this week to be published in anticipation of a public hearing on April 2, the funding may drop to zero.
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The Capitol Improvement Program is designed to anticipate and prepare for major expenses to the County. Capital projects are defined as major non-recurring expenses with a useful life of more than two years. Projects usually cost at least $10,000, but often much more than that. A five-year plan is created which is intended to guide construction, acquisition and financing of such capital projects.
Projects expected to cost more than $50,000 must come before the Planning Commission, which then makes a recommendation to the board.
While funding of the CIP has been much more generous in the past, not all of that money came from the general fund.
For example, in fiscal years 2008-2009 and 2009-2010, a total of over $1,700,000 in debt proceeds was used to fund the CIP. In recent years, money has also been taken out of other funds to help support the CIP. In fiscal year 2011-2012, almost half of the $422,320 used to fund the CIP was taken from the utilities operating fund.
This current fiscal year, the $56,820 budgeted for the CIP fund was taken from the Industrial Development Authority fund. However, the proposed budget for the upcoming year suggests that over $83,000 will have to be given back to the IDA fund now, in order for it to balance.
While the board approves a CIP five-year plan each year, they are not required to fund it.
The plan approved by the board last year projected a total expense of over two million dollars. Only two projects on the plan were actually funded in the approved budget: $45,000 for computer upgrades and a $11,810 annual payment on an engine for Randolph Fire Department.
Although funding has slowed, equipment and buildings continue to wear down in Cumberland County. The projected expense for the upcoming CIP has grown by more than a million dollars. Three school projects included in the plan are designated as “required and urgent.”
While hearing requests from department heads in preparation for the upcoming budget last month, the board heard about the eventual need to replace aging vehicles for the sheriff's department, an outdated 911 system that requires near monthly maintenance and the animal control incinerator for which some replacement parts are no longer obtainable.
However, none of these expenses are planned for in the current proposed budget, since the CIP fund is not slated to receive any revenue.
When discussing the lack of funding for the CIP in her proposed budget, County Administrator and Attorney Vivian Giles stated, “We aren't the only locality who takes this approach.”
She also stated that the County appears to be ahead in revenue this year. She pointed out that the board could say, “we have $400,000 left this year, rather than growing our savings, let's use that to fund capital improvements.”
And, not all department needs make it onto the CIP. For example, during a meeting with board members last month, Animal Control Officer John Sullivan shared that his incinerator is on its last legs and could cost about $33,000 to replace it with a smaller model, an item that is not listed as an eventual expense to the County.
The county is required to either bury or burn animal carcasses, Sullivan said, adding that the incinerator is the cleanest way to go.
Sullivan reported that the incinerator is 17 years old and the County bought it used for $2,000. The department has jerry-rigged repairs, even having grates fashioned out of metal Sullivan discovered during a hunting trip and was able to buy inexpensively. Some replacement parts are not even available anymore, he reported. For now, Sullivan said, “I'm going to try to use it.”
However, some types of equipment failure could mean more than just inconvenience to the County or the need to dig a pit.
Sheriff Darrell Hodges had also requested three replacement cars in the CIP plan, but told the board he realized money was tight.
He said the requests were to replace vehicles which had both very high mileage and a lot of maintenance difficulty, quickly adding, “But…we'll keep putting band-aids on it…as long as we can.”
Aaron Hickman, the director of information technology, spoke with the board about the County's 911 system. He said that with most of that equipment, “almost on a monthly basis, I'm actually soldering and de-soldering and repairing. We're kind of hanging on…”
He reported that the 911 equipment was installed in 2003 under a wireless grant. Although Hickman has applied for a grant for the needed equipment, he says it does not look like the grant will be funded, because so many other people have applied for it.
“We're kind of a bare bones 911 system,” Hickman said, mentioning that “unlike other Counties, we save quite a bit on what we do in house, such as mapping.”
“E911 call taking replacement” is listed as costing an expected $45,271 in the administrator's CIP for the upcoming year.
The maintenance service contract for the 911 system was completely eliminated in the proposed budget presented to the board during a work session earlier this month.
Supervisor Bill Osl mentioned the cut to the 911 maintenance contract and asked, “is that jeopardizing 911?”
Giles responded, “I had to cut something… In talking with Aaron (Hickman), he's pushing things off. He's keeping them going as long as possible. So, I mean, that may be one of those things that if it dies it would have to come back to the table. It's functioning for now…”
“So try to help it to limp along?” Osl said, equating it with the incinerator.
“Right, exactly, right,” said Giles, “because there's nothing in there for capitol projects. I mean, there just isn't. And from what I can understand…this isn't the only budget in the commonwealth that looks like that this year.”
Giles acknowledges that this approach may lead to some unplanned expenses in the upcoming fiscal year, “If something drastic happens and something must be attended…there are things that come up and they just do.”
The board has shown its willingness to work with departments in need of help with capital projects mid-year. Last November, doors for the Cartersville Volunteer Rescue Squad building were funded for $10,080. The doors had been a project listed and approved with the year's CIP, although they had not been funded in the budget.
During the board meeting when the money was appropriated by the board for the rescue squad doors, Supervisor Kevin Ingle, District Three, thanked the squad for “following the process, which we told him at the budget time, 'If money came short and more things were needed, we were going to be here for you to work with.'”
However, the board has also struggled when unexpected expenses are brought to their attention during this current fiscal year. The month following the approval of the rescue squad doors, while discussing unplanned jail bills, Supervisor Lloyd Banks, District Two, stated, “we can spend money we don't have or we can reduce expenses elsewhere…Are we willing to reduce expenses elsewhere to offset these unexpected costs?”
And, true to their plan, the board met earlier this month to re-appropriate money to cover several unplanned for expenses, which were covered by savings and cuts in other areas of the budget. Banks later told The Herald that he did not vote in favor of those re-appropriations because there were not enough cuts.
Project requests are submitted by departments and ranked according to priority: a one being “required and urgent” and a five being “not justified.”
Of the 16 projects calculated to cost more than $50,000 on the CIP plan recommended by the Cumberland Planning Commission last month, three were ranked a one, all for the school: a roof for the elementary school and bus shop, a tile floor for the elementary school and construction of new football grandstands.
Chip Jones, assistant school superintendent of finance and operations, notes in his submissions of the request for the elementary school and bus shop roofs, that they have “major leaks” and, at 16 years old, have recently gone out of warranty. The replacement cost is calculated to be nearly half a million dollars.
The football grandstands are also noted to be a safety issue, since they are constructed of wood and metal increases the risk to spectators if the wood breaks.
Other “pricier” projects include: backup/business park water, Randolph 3,000 Gallon Tanker Purchase (See accompanying story in today's paper), Cartersville Volunteer Rescue Squad ambulance replacement, a new elementary school HVAC system and public library expansion project.
While it is certain that the board will approve a CIP five-year plan for the upcoming year, the question on many department head's and community organization leader's minds is whether that plan will actually be funded so that capital projects can occur.