MINUTES OF A WORK SESSION OF THE TOWN OF CHAPEL HILL,

NORTH CAROLINA, WEDNESDAY, APRIL 5, 1995 AT 5:30 P.M.

Mayor Broun called the work session to order. Council Members in attendance were Joyce Brown, Joe Capowski, Mark Chilton, Pat Evans, Lee Pavão, Barbara Powell, Jim Protzman and Rosemary Waldorf. Also in attendance were Town Manager Cal Horton, Assistant Town Managers Sonna Loewenthal and Florentine Miller, Public Works Director Bruce Heflin, Parks and Recreation Director Mike Loveman, Town Engineer George Small, Transportation Director Bob Godding and Town Attorney Ralph Karpinos.

General Budget Overview

Mr. Horton said it would be helpful for staff to receive the Council's guidance this evening on possible changes in Town fees.

Finance Director James Baker said property taxes and state-shared revenues comprised about 82% of all revenues in the Town's General Fund. He noted that there had been no significant changes in fees from the staff's preliminary report. Mr. Baker stated that staff continued to be optimistic that the General Assembly would earmark replacement local government revenues in the event that the intangible tax were repealed. He also noted that interest income of $280,000 to $300,000 was anticipated, based on an average rate of return of about 6 1/2%.

Compactor Collection Fees

Mr. Heflin presented an overview of the staff's proposal concerning the initiation of a refuse collection fee for compactors along the north side of the 100 block of East Franklin Street. Mayor Broun asked whether such payments would be optional. Mr. Heflin said users would be assessed fees that varied by volume of waste. Council Member Brown inquired about the composition of waste in the compactors. Mr. Heflin said although no formal analysis had been performed, it was possible that some recyclable products were being thrown into the compactors. Council Member Chilton noted that the Landfill Owners Group was investigating the possibility of initiating a cardboard recycling program. Council Member Capowski inquired how the volume of individual users was determined. Mr. Heflin stated that a key system was used to track usage by each business. Council Member Capowski inquired about the possibility of establishing an incentive system. Mr. Heflin stated that recyclers saved under the current fee structure.

Council Member Protzman inquired whether downtown commercial establishments were receiving full value for the level of taxes paid. Mr. Horton stated that Town service expenditures in the downtown area far exceeded property taxes collected. He added that the fee was being proposed to recover a greater percentage of direct service costs, such as equipment maintenance. Council Member Evans inquired whether both compactors were located in the 100 block of East Franklin Street. Mr. Horton said yes, noting that one was located behind the Intimate Bookshop, while the other was behind the Post Office building.

Council Member Brown inquired about the impact on fees collected if a recyclables ban were put into effect. Mr. Heflin said it would be very difficult to predict the actual effect of such an action. Mr. Horton said if there were commercially successful programs of this type, there would be no change in net costs.

Supplemental Garbage Collection Fee

Mr. Heflin stated that staff had projected an extra $6,200 could be collected if a higher fee were charged for businesses desiring four refuse collection pick-ups per week.

Council Member Capowski inquired about the cost differential between front and side-loading trucks. Mr. Heflin stated that front-loading trucks were considerably more expensive. Council Member Capowski asked whether merchants had options to four day per week collections. Mr. Heflin said merchants could choose to receive twice weekly pick-ups or use private haulers for additional pick-ups. Council Member Capowski inquired why annual Town collection service was $2,200 compared to $5,400 for private sector service. Mr. Heflin stated that there was an economy of scale since the Town handled a majority of commercial refuse collection accounts.

Council Member Capowski inquired whether it was correct that there was no economic incentive to throw out less. Mr. Heflin said this was generally correct.

Council Member Evans inquired about dumpster-related recommendations for new developments. Mr. Heflin stated that front loading dumpsters were recommended since this type of equipment was much more efficient than side-loading dumpsters. Mr. Horton added that efforts were made to encourage the shared use of roll-off compactors whenever possible.

Council Member Powell inquired whether it was correct that alley ways in the Southern Village might be too narrow to accommodate wider refuse collection trucks. Mr. Heflin said this was correct, that residentail refuse collection was planned from the streets.

Council Member Waldorf inquired whether businesses had been notified of the proposal. Mr. Heflin said no such notification of the proposal had been made to date. Mr. Horton noted that staff was recommending implementation six months into the year in order to provide for an adequate notification period.

Rental of Portable Dumpsters

Mr. Heflin presented a brief overview of the staff's proposal.

Council Member Protzman inquired whether the $10 per day rental fee was sufficient to cover the Town's expenses. Mr. Heflin said that, although no close cost analysis had been performed, he thought the yard waste containers were a benefit to the Town since they helped to save on labor costs. Mr. Horton said the rental cost had been set at a nominal level as an incentive for residents to handle their own yard waste related labor. Noting that most containers were rented on weekends, Mr. Heflin said he felt the service was a good one which was well-utilized.

Council Member Evans said it might be possible for someone to buy composted yard waste and resale it on a commercial basis. Mr. Heflin said staff was not aware of anyone doing this on a large-scale basis.

Council Member Brown inquired how many waste containers were available for rental. Mr. Heflin said the Town had eight yard waste and six mixed waste containers which could be rented.

Mayor Broun inquired whether any Council Members had concerns about going forward with any of the three refuse collection related fee proposals. Council Member Evans noted that the last option would only raise an additional $1,200 per year. She added that her neighborhood had a popular spot for illegal dumpers. Mayor Broun said he believed that most improper dumping occurred because people were unaware of available resources, rather than feeling that the cost of rental containers was too high.

Fee for Police Record Checks

Mr. Horton said staff recommended imposing a $15 fee for record checks, with projected additional annual revenues amounting to $18,000. Council Member Evans inquired whether this fee had been raised during the last fiscal year. Mr. Horton said he did not believe so. He also noted that attorneys were the principal users of this service. Mayor Broun inquired whether $15 was sufficient to cover actual direct costs. Mr. Horton said this was correct.

Council Member Waldorf asked whether the Police Department received a lot of requests for fingerprints. Mr. Horton said yes, noting that there was a fee for this service.

Development Review Application Fees

Mr. Horton said there needed to be a reasonable relationship

between fees charged and services provided. Mr. Horton also said he could assure the Council that staff had done their very best to assure that the recommended fees were reasonable. Mr. Waldon said it was very difficult to consistently track the costs of reviewing individual development applications. He stated that staff could comfortably recommend the proposed increases and still be below the actual costs incurred for processing.

Mayor Broun noted that the Town's proposed development review fees were considerably higher than most other communities in the State.

Mr. Horton stated that Town staff spent considerably more time reviewing applications than other communities. Mayor Broun inquired whether it was correct that there was no general Council opposition to the proposed fee increases. Council Member Capowski stated that the proposed increase was not very big for larger subdivisions on a per lot basis. Mayor Broun said there appeared to be no objections to including the proposal in future budget drafts.

Engineering Fees

Town Engineer George Small said the Town recovered approximately fifty percent of costs related to engineering inspections. He briefly reviewed the criteria used for determining proposed engineering fees. Mr. Small stated that the proposed fee schedule would result in recouping about 90% of all direct inspection costs.

Council Member Waldorf inquired whether any inspections resulted in cost savings for developers or builders. Mr. Small stated that

inspection staff could assist in insuring that projects are built as economically as possible. Council Member Waldorf inquired whether developers needed to engage their own professional engineers for project inspections. Mr. Horton said this was correct, noting that it would be inappropriate for project engineers to inspect their own work. Council Member Evans inquired whether it was correct that Town engineering inspectors only inspected streets and sidewalks and other public facilities. Mr. Small said this was correct. Mayor Broun noted that there appeared to be no objection to including the fees for future consideration.

Cemetery Fees

Mr. Small stated that the Town's cemetery plot fees were well below those of other communities. He said staff recommended increasing these fees incrementally. Mayor Broun said he was concerned about

the impact of proposed fee increases on poor people and families.

Council Member Powell said if there were no particular reason to raise these fees, she saw no reason to do so. Mr. Horton said the principal objective was to capture a greater portion of the Town's maintenance costs for cemeteries. Council Member Powell stated if it were not necessary to raise these fees, she would prefer that they not be increased. Council Member Capowski inquired about the estimated cost of maintaining cemeteries. Mr. Horton said staff could provide this information. Council Member Capowski said it was not a good reason to raise fees just because costs were lower than other communities.

Council Member Brown inquired whether any municipal cemeteries used a sliding fee scale. Mr. Horton said a standard could possibly be established in this regard. Mayor Broun stated that this might be somewhat difficult to establish and administer. Mayor Broun said it appeared that the Council was willing to examine this fee change further if the staff could provide additional details.

Transportation Fund

Transportation Director Bob Godding presented a status report on

anticipated state and federal operating funding assistance. He stated that a thirty percent reduction in federal operating assistance was anticipated. Mr. Godding also said the Town would receive a total of $483,000 in State transportation funding during the current fiscal year.

Council Member Evans inquired about the status for sharing bus system costs between the University, Town of Carrboro and the Town.

Mr. Horton said the formula was basically a cost and revenue allocation formula, with contracts for specific services provided being negotiated on an annual basis.

Council Member Brown requested a brief clarification of the federal funding picture for transit programs. Mr. Godding stated that the current plan appeared to call for a gradual elimination of the federal transit operating assistance program. Council Member Brown asked whether local governments would be included in decision making processes for the Intermodal Surface Transportation Efficiency Act (ISTEA). Mr. Horton said he would not rely on ISTEA to give local governments solace. Mayor Broun expressed his concurrence.

Council Member Capowski inquired about the status of the proposed acquisition of up to twenty-eight new buses. Mr. Godding stated that twenty new buses were on order, with delivery anticipated by mid-October. He stated that, even if the state's capital grant is approved in time, eight additional coaches might not be produced until late 1996 or early 1997. Council Member Capowski inquired whether it was correct that federal funds would cover 80% of these costs while state funds would cover an additional 10%. Mr. Godding said this was correct.

Bus Fare and Pass Prices

Mr. Godding said a bus fare increase from 60 cents to 75 cents was proposed, as was an increase in the Tarheel Express one-way fare from $1.50 to $2.00 and an approximately 7% increase in bus pass prices. Mr. Horton added that if bus ridership fees were not increased this year, a larger tax increase would be needed in 1996-97. He also said that given general federal and state actions to reduce funding to local governments, future budgets would be very challenging.

Expressing his concurrence with the Manager's observations, Council Member Chilton said it might be fruitful for local governments to band together with other transit systems around the State to seek alternative revenues such as greater levels of State transit funding. Council Member Chilton inquired about the general percentage of farebox revenues split between the University, Town of Carrboro and the Town. Mr. Godding said the overall fund split was approximately 50% for the Town, 35% for the University and 15% for the Town of Carrboro. Mr. Horton said if the Council desired, staff could give greater detail on cost estimates and the allocation formula.

Council Member Capowski inquired whether it was correct that the average cost of a bus ride was approximately $1.49. Mr. Godding said the estimated cost was $1.51. Council Member Capowski asked whether the proposal was to maintain a stable tax rate for transit services. Mr. Horton said staff would strive for this based on increased bus fees. Council Member Capowski inquired about the cost of trolley operations. Mr. Horton said these totalled approximately $90,000 per year. Council Member Capowski inquired about the cost of providing EZ-Rider service. Mr. Horton said staff was in the process of pulling this information together for a future budget work session. Council Member Capowski inquired whether the Town had a process for selling bus reduced rate bus passes to lower-income persons. Mr. Horton said staff was working on a policy for partial or total fee waivers based on income.

Council Member Protzman inquired about the fiscal impact if there were no decline in ridership. Mr. Godding said staff could determine this impact. Council Member Protzman inquired whether Town staff had spoken to University officials about its expanded Point-to-Point shuttle service and its impact on Town bus ridership. Mr. Godding stated that the original objective of the system had been to provide for a small shuttle service for staff to travel to and from off-campus buildings. Council Member Protzman inquired whether it was correct that there was no fee for the point-to-point service. Mr. Godding said this was correct. Mr. Horton stated that although the overall bus system was strong, staff did have some concerns about the impact of the new service on some of the Town's heavily travelled and most profitable routes.

Council Member Protzman said it appeared that the University was competing to some degree with the existing bus system. Council Member Protzman also said he thought it might be worthwhile to do some modelling relative to the proposal to increase annual bus passes to $204.00. He stated that the Town might wish to consider marketing the passes at a figure below the $200 threshold.

Council Member Brown inquired about the overall impact of the Point-to-Point service on overall ridership. Mr. Godding said it was not always possible to measure direct impacts on ridership. Council Member Brown inquired about the possibility of comparing system operating costs for the Town's system and the University's new service. Mr. Godding said staff had not received earlier requested information concerning operating costs for the University's Point-to-Point service. Mr. Horton said although staff could pursue getting this information with greater vigor, the University would likely only be able to provide reliable direct cost information.

Council Member Brown inquired about strategies to resist further erosion of the Town's bus ridership. Mr. Horton stated that the existing memorandum of understanding contained a non-compete clause. He said staff would not agree to further service incursions. Mr. Horton also noted that it was much less expensive to operate smaller vehicles such as those operating on the University's Point-to-Point system, than the coaches that Chapel Hill Transportation uses.

Council Member Chilton noted that the new Point-to-Point system was extremely popular because of its convenience and security to users.

He added that these level of services exceeded those which could feasibly be provided by the Town's bus system.

Council Member Capowski inquired whether the point-to-point and related PTP Express had resulted in a one percent or greater decline in overall ridership on the Town's bus system. Mr. Godding stated that the new services were not directly competitive with the Town's bus system.

Council Member Brown inquired whether the proposed cost of annual bus pass ($204) would exceed the annual cost of a student parking permit. Mr. Horton said the number of parking permits in lots proximate to the University campus area was extremely limited. Council Member Brown requested additional information from staff on this point.

Council Member Chilton stated that any gaps in the University's bus funding allocation formula could be covered by a portion of the sale of parking permits. He noted that the Town did not currently have options such as local gas tax or vehicle registration fees to subsidize bus fares to a greater extent. Council Member Chilton said it would be interesting to receive the University's and Town of Carrboro's comments on these possible new funding sources.

Mr. Horton said staff could provide additional information about these options. Council Member Chilton said there were a number of other budgetary options available to the Council other than increasing bus fares from 60 to 75 cents. Council Member Brown noted that the North Carolina Public Transit Coalition was engaged in efforts to earmark new local funding sources for transit operations.

Noting that although about 70% of bus system riders were University-affiliated, Council Member Capowski said the Town did not control bus pass prices for University students, faculty or staff. Council Member Powell suggested that Town staff engage in dialogues with University officials about bus system concerns.

Council Member Protzman said he believed this occurred on an ongoing basis.

Mayor Broun noted that the staff's proposal for increased bus fares and fees was still very much on the table for future Council discussion. He stated that the Council also needed additional information prior to making final decisions on these matters. Council Member Protzman requested that staff provide additional information on scenarios assuming no decline in ridership and a ten percent decline in ridership.

Parking Fines and Fees

Mr. Godding presented an overview of proposed fees and fines, noting that additional revenues of $38,000 were anticipated.

Council Member Brown inquired about the status of delinquent fines. Mr. Godding stated that the Town collected about 75% of $5 fines and 60% of $25 fines. Mr. Horton said a collection agency was used to handle delinquent accounts. Council Member Protzman inquired whether the collection agency received a percentage of proceeds for its services. Mr. Godding said yes.

Council Member Chilton said he thought parking meter violations should be increased from $5 to $10. He also noted that the City of Durham imposed a $50 fine, compared to the Town's $25 fine, for not having a proper neighborhood parking permit.

Council Member Evans said she did not favor adding a new position for parking enforcement purposes. Mr. Horton said staff estimated that an additional expenditure of $40,000 would yield additional fine revenues of $95,000 per year. He noted that the number of parking meters had recently increased, necessitating the addition of staff for effective enforcement. Council Member Protzman suggested the possibility of having a six month contract to evaluate the possibility of adding another parking enforcement position.

Mayor Broun said there appeared to be no objections to raising fines from $5 to $10 or initiating an additional six-month contract parking enforcement position.

Mr. Horton noted that Town staff was working with a local association of retired executives to evaluate the possibility of privatizing management of the Town's off-street parking facilities.

Council Member Powell requested that staff provide additional information about positions added to the Town's staff during the past five years.

Council Member Brown asked whether the Council needed to make decisions this evening about parking enforcement and fines. Mayor Broun said no, noting that these decisions could be made in the future.

Landfill Fund

Mr. Horton noted that the Landfill Owners Group had not made a final decision or proposal concerning landfill-related fees and services. Solid Waste Administrator Gayle Wilson presented an overview of proposed tipping fees and revenues. He also noted the importance of maintaining an undesignated fund reserve. Council Member Capowski inquired whether a sufficient fund balance was in place. Mr. Wilson said he believed there was sufficient fund balance.

Council Member Evans inquired whether some haulers tried to go across county lines to receive lower tipping fees. Mr. Wilson said yes. Council Member Chilton noted that Orange County's tipping fees were higher than Wake County's but lower than other surrounding counties.

Council Member Capowski inquired how many tons of refuse were in a typical garbage truck. Mr. Wilson said about six tons. Council Member Capowski asked what percentage of refuse collection fees were tipping fees. Mr. Wilson said approximately twenty-five percent for residential service.

Council Member Brown inquired about regulations pertaining to out-of-county dumping. Mr. Wilson noted that the Council had adopted a resolution prohibiting out-of-county dumping. He said staff attempted to minimize such practices.

Council Member Chilton said it appeared that some partners in the Landfill Fund were interested in higher tipping fees.

Commercial Collections Fee

Mr. Heflin said staff was proposing an increase in fees for basic commercial refuse collection services, yielding estimated additional revenues of $138,000 per year, assuming a customer attrition rate of 20%.

Noting that he would not oppose an increase in these fees, Council Member Chilton noted that some multi-family complexes did not have sufficient room to accommodate dumpsters.

Council Member Evans said one possible positive effect of a fee increase might be that businesses would be encouraged to share dumpsters.

Council Member Waldorf said she was uncertain whether the proposal was a fair one. Council Member Capowski inquired whether it was correct that there was no incentive in this plan for businesses to recycle. Mr. Heflin said one possibility would be to institute a charge based on the number of dumpsters at a location. Council Member Capowski asked whether it was correct that the fees did not apply to the University or UNC Hospitals. Noting that these facilities made other arrangements for refuse collection, Mr. Heflin said this was correct.

Council Member Protzman said he was concerned about equity, especially for small business owners. Council Member Protzman also said he supported a ban on the dumping of corrugated cardboard. Council Member Capowski suggested that the Council needed additional time to contemplate this proposed change in fee structure. Mayor Broun said although there appeared to be some interest in this option, there did not appear to be enthusiasm on the Council's part at this time.

Reduced Service Levels

Mr. Heflin said another option would be to reduce the number of extra commercial collection days from four to two, eliminating the need for one side-loader refuse collection route. He stated that an informal service of customers found that the only concerns expressed were by a couple of local restaurants. Mr. Heflin noted that restaurants or other businesses wishing to do so could contract with private contractors for additional trash collection pick-ups.

Mayor Broun noted that a slightly lower fee was being proposed for about one-half of the existing service level. Council Member Capowski asked whether special odor-related problems would be encountered during warmer weather. Mr. Heflin said he did not believe so. Mayor Broun said there appeared to be no objections to the proposal at this point.

Bulky Goods Collection Fee

Mr. Heflin said staff believed an additional $34,000 per year could be realized from charging a fee for collecting bulky (odd-sized) goods such as appliances and furniture.

Council Member Waldorf inquired whether it was feasible not to charge a fee if bulky goods were brought to the landfill by residents. Mr. Heflin said this possibility and details for fee collection could be outlined in a follow-up report by staff.

Council Member Powell said although she did not oppose the fee, she feared that the amount of improper dumping would increase. Council Member Protzman said he liked the idea of charging a fee for bulky goods collection. Mayor Broun said he believed most people would be willing to pay such a fee. Council Member Pavão concurred, noting that the disposal of bulky goods was a relatively infrequent occurrence for most citizens.

Council Member Brown said staff could look into the possibility of instituting serious fines to minimize dumping violations. Mr. Horton noted that these maximum fines were State-mandated. Council Member Evans noted that there was a serious illegal dumping problem across the street from the entrance to the Hundred Oaks development.

Council Member Capowski inquired whether the Town accepted credit cards as a form of payment. Mr. Horton said no, noting that credit card firms generally charged service fees to their clients. Mayor Broun said there did not appear to be any objection to including the proposal in future budget working documents.

Parks & Recreation Fees

Youth & Adult Fees

Parks and Recreation Director Mike Loveman said staff proposed increasing youth program fees, yielding total additional annual revenues of about $10,000. He also said staff recommended increasing adult program fees for additional revenue of approximately $10,000. Mr. Loveman noted that fee waivers were available for both youth and adult programs.

Council Member Pavão said it was especially important not to place families with more than one child in difficult situations concerning enrollment in youth recreation programs.

Mayor Broun said he favored increasing adult program fees but not fees for youth programs. He also stated that it was somewhat easier to request a fee waiver for oneself than for children.

Expressing her concurrence with Mayor Broun's observation, Council Member Powell inquired about the possibility of charging family fees or the possibility of fee payments on a monthly basis. Mr. Loveman stated that it was possible for program fee payments to be made on an installment basis or for fees to be waived partially or totally.

Council Member Pavão asked whether the Parks and Recreation Commission had reviewed the proposed fee increases. Mr. Loveman stated that the Commission had no objection to either fee increase.

Mayor Broun said the Council's consensus appeared to be to increase adult program fees only.

Library Book Reserve Fee

Public Services Librarian Mark Bayles said the proposal was to increase the fee for increasing books from $0.30 per title to $1.00 per title.

Council Member Capowski asked whether reserve requests could be handled over the telephone. Mr. Bayles said no, since it was necessary to collect a fee for this service. Council Member Capowski asked whether an appreciable number of patrons used personal computers to access the card catalogue. Mr. Bayles said an increasing number of patrons used computers for catalogue access.

Council Member Chilton inquired about the possibility of raising the maximum fine for overdue adult titles. Mr. Bayles noted that patrons with seriously overdue books also faced the loss of borrowing privileges. Mayor Broun said there appeared to be Council consensus to proceed with this proposal.

Motor Vehicle License Fee

Mr. Horton noted that only the Town of Carrboro and the Town had bills before the General Assembly requesting authorization for a local motor vehicle license fee. He said projected revenues from this source totalled $315,000. Mayor Broun said there appeared to be Council consensus to proceed with this proposed new revenue source.

Solid Waste Collection Service Options

Assistant Town Manager Loewenthal stated that the consultant was presenting their report on integrated solid waste management in three separate stages, with the second portion being made to the Council on May 8th. She stated that this stage of the study would outline options for reduction collection and processing of solid waste. Council Member Capowski inquired about possible options relative to a unit-priced collection system. Ms. Loewenthal said this would not be discussed in this report in terms of how a unit-priced system might impact an overall collection system. Council Member Capowski said he was frustrated because he thought this specific question would be addressed in this section of the report. Ms. Loewenthal said this aspect would be covered in the consultant's final report. Council Member Chilton noted that the citizen's advisory committee and Landfill Owners Group had both requested changes to the proposed content of the consultant's study.

Noting that Orange County and Town of Carrboro already had their refuse collection systems in place, Council Member Brown suggested that the Council begin talking about criteria for possibly changing the Town's refuse collection system. Mayor Broun said it would likely be hard to come up with specific suggestions in the budget process. Council Member Brown said it was important for the Council to develop a list of measurable criteria. Mayor Broun inquired when the consultant's report would be discussed by the Council. Ms. Loewenthal said this was the Council's prerogative to determine a specific date for discussion. Mayor Broun said it was important for the Council to begin thinking about the items touched upon by Council Member Brown.

Council Member Protzman said if the consultant's report had to go back for further revisions and narrowing, it was especially important for the Council to develop specific criteria or guidelines as soon as possible. He also inquired where waste reduction was addressed in the proposed report. Mr. Heflin said this matter was addressed in a number of goals.

Council Member Brown said Orange County had elected to have staffed collection stations throughout the County at a considerable cost, while the Town of Carrboro had a weekly rollout refuse collection program. She stated that the consultant's report and the Town's method of refuse collection were two on-going processes which needed to be coordinated.

Mayor Broun suggested that staff schedule a follow-up discussion on the consultant's report on the Council's May 22nd meeting agenda. Mr. Horton said staff would do so.

The work session concluded at 9:11 p.m.