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Mecklenburg County staff pitched a plan Tuesday to pay for new or renovated schools, libraries, parks and a jail over the next four years - and that opened the door for more construction projects to be added in the future.
The county has previously said it could afford to spend a little over $1 billion on construction during the next four years and stay in compliance with its debt policy.
The proposal from county staff calls for spending most of that money, at least $783.3 million, to pay for construction projects that have been approved either through bond campaigns or in other votes by county commissioners. Other previously approved projects would be spread out over later years or deferred altogether.
That would leave about $296 million that could be spent on other construction, including new projects that may be needed in coming years.
The county would get most of the construction money through selling bonds that would need to be repaid later.
But the plan also highlights a goal by county leaders to dedicate more money in the budget to pay for some construction projects outright, instead of borrowing money and incurring interest fees.
For example, the county originally proposed using bonds to cover the cost of building a new jail in north Charlotte. The new recommendation, however, would allocate money from the "pay-as-you-go" fund - including $39 million next year - to build the jail and reduce the amount of new debt, said Finance Director Dena Diorio.
County leaders have spent much of the past two years looking for ways to get a better handle on how to pay for construction, largely in response to concerns from rating agencies that the county had fallen out of compliance with parts of its debt guidelines.
In January, commissioners backed a staff recommendation to go on a "debt diet." A month later, the board decided to cap how much in bonds it issued for five years.
That plan called for issuing no more than $150 million in bonds during the 2010-11 budget year, and up to $253 million in each of the next three years. The county also would pour more money into the pay-as-you-go fund.
Agencies that receive county money for construction - including Charlotte-Mecklenburg Schools, Central Piedmont Community College, the library and park systems and county departments - were asked to map out how much money was needed for their projects in each year.
Initially, it appeared the county would have trouble meeting all of the requests for next year's pot of construction money. But on Tuesday, staff said they would be able to accommodate everyone's requests, largely because the amount of money needed for the new jail next year had dropped and the county will be able to put more money into the pay-as-you-go fund than originally anticipated.
Diorio said the county also will be able to meet most of the annual agency requests in later years, and likely still afford to add new ones if needed.
County commissioners will vote on the debt plan in the coming months. Among their questions for staff on Tuesday were whether it would be possible to spend all of the available construction money next year to take advantage of lower building costs in the bad economy and to free up more money in the future.
Yes, they were told. But Diorio said staff didn't want to propose spending more than the agencies had asked for in any given year. County Manager Harry Jones also said staying below the spending targets would reduce future debt payments.
