Removing jail money reduces bond total

Mecklenburg County will send a smaller bond package to voters in November, after agreeing Tuesday to pay for a new jail using money that doesn't need approval from the public.

All seven commissioners present for the vote agreed to use certificates of participation to cover the $360.2 million price tag for a new jail and improvements to the sheriff's office.

Also Tuesday, commissioners unanimously agreed to ask voters for up to $250 million for parks and recreation projects. They could lower the amount in the coming weeks, and will hold a public hearing in September before deciding on a final bond size.

In May, County Manager Harry Jones recommended putting both the jail and parks projects up for a bond vote in November.

But recently, some in the community expressed concern about sending too large a bond package to voters in light of the worsening economy. The Charlotte City Council already has agreed to ask for $227.2 million in bonds to pay for roads, affordable housing and neighborhood development initiatives.

Together, the city and county bond proposals, without Tuesday's action by the county, would have totaled $787.4 million, far surpassing the record $581.6 million approved by voters last year.

Last week, the Charlotte Chamber urged commissioners to look for ways to reduce their bond proposals. Democratic commissioners Dumont Clarke and Parks Helms asked to pay for the jail using certificates of participation.

Using the certificates – which don't require a referendum and would be paid back over 20 years – will allow the county to speed up some work for the jail.

At first, some commissioners resisted the idea, partly because they said the certificates – also known as COPs – carry a higher interest rate than traditional bonds.

But Finance Director Dena Diorio said Tuesday that any increase in interest rates would be “negligible” – less than three-hundredths of a percent.

The county plans to use money already available to start design work for the facility, which is intended to ease crowding at the 2,776-bed jail in uptown Charlotte.

About 400 inmates slept on the floor on an average night in 2007, according to county statistics.

Building the jail “is a critical public safety issue,” said Helms, the commissioners' vice-chairman. “It cannot wait.”

The vote crossed party lines. Republican commissioner Dan Ramirez had stepped out of the room before the vote. Republican Dan Bishop was absent from the meeting.

Debt would soar

Mecklenburg is set to make $233 million in debt payments in 2008-09. That equals about 25.75 cents of the county's 83.87-cent tax rate.

The debt payment would soar past $341 million in 2013 to cover the new bonds and other county projects.

County officials said they won't necessarily have to raise taxes to make the bigger payment because they use a variety of sources to pay for construction projects.

The county uses traditional bonds to pay for the overwhelming majority of construction projects, with commissioners saying voters should get the chance to decide how the county spends money. But COPs have been used for projects the county needs to build quickly, including schools.

Jones said after the meeting that using certificates of participation to pay for the jail assures that money will be available for the project.

“What if you do a bond referendum and that bond referendum fails and you know that you have this critical need that has to be met?” Jones asked. “Do you come back and then you say I'm going to issue COPs? Or do you … just go ahead and get it done?”

County leaders are considering building the new jail off Spector Drive in north Charlotte, but won't rule out other locations. They said that building the jail uptown could cost more than $30 million more than the north Charlotte location.

Boosting park assets

The parks bond proposal approved by commissioners on Tuesday aims to boost the amount of park land and facilities available in the county.

Charlotte-Mecklenburg had 22 acres of park space per 1,000 residents in 2006; the average is 30.5 acres for cities of similar size, according to a study from the Center for City Park Excellence. The county spent $45 per resident on parks in 2005 compared to $89 per resident for the 60 cities used in the study.

Commissioners have not agreed on which park projects would be paid for with the bonds. Park officials have said they might use the money for a variety of projects, including $60 million to buy land and $43.5 million for greenways.