County stands firm on joint funding

Responding to a proposal for a new funding arrangement for joint projects made by Henderson City Manager Jerry Moss at an August 14 City-County meeting, County Manager Jerry Ayscue took the opportunity to reply to some of the points made in Moss’ proposal at the outset of yesterday’s meeting.

(Supplemental 911 material regarding Moss’ proposal may be viewed here).

Summarizing a prepared document, Ayscue began by saying that joint programs had to be of value for both the governments to put them together. He said that months of deliberation and planning had gone into forming the joint programs.

Ayscue told members of both entity’s intergovernmental committees that the size of the City and the County make conditions reasonable to run joint programs, especially given the limited resources of the jurisdictions.

The County Manager claimed that the Aycock Recreation Center and the H. Leslie Perry Memorial Library would not exist without the collaboration.

“It makes good sense,” Ayscue said after telling members that the joint programs save citizens money by avoiding duplication of effort.

Ayscue said that there was potential for the City and County to work together in the future as well as potential for consolidation.

Referencing a North Carolina Institute of Government work, Ayscue argued that counties in North Carolina exist to serve state purposes. He further stated that cities are formed by people to serve the need of residents who want a higher or different level of service.

“I think it’s an important distinction,” Ayscue said.

The County Manager said that the City’s proposal would cause non-City residents to pay for City services.

Ayscue disagreed with the City analysis that Henderson pays 80% of jointly funded programs, arguing that the figure only factors in property taxes. He argued that the City has other sources of revenue, and that if it is appropriate for the County to pay for the programs, it is also appropriate for the County to take revenue from those non-City sources as well.

The County Manager asked why the County needs to pick up the funding when many of the joint programs were initiated by the City.

Responding to a suggestion that the County could use funds made available through Medicare relief, he told members that the state wants that money used for the enhancement of schools. He said it was for the County Commissioners to decide how to use those funds should they become available.

Citing a concern of dual taxation, Ayscue said that if the County pays for joint programs, there is no incentive for it “to come to the table”. He added that splitting services only compounds the problem of taxpayers paying more for services.

“The City has a lot of pressing needs,” Ayscue said. “…the same situation exists for the County.”

Ayscue ended his remarks by stating that he thought there are better ways for the two governments to work together and stated a need to strengthen the cooperative relationship between the two bodies.

“Let’s get on with our work together,” he said.

County Commissioner Terry Garrison expressed agreement with Ayscue’s remarks.

City Council member Bobby Gupton stated agreement to much of what Ayscue said, but argued that the majority of the tax burden comes from the Aycock Recreation Center, the library, and Aycock aquatics.

Gupton said that those three facilities amount to 20 cents on the tax dollar, and that they do affect ad valorum taxes.

The Council member also stated that the contracts for the joint funding arrangements were written to be amended with a 30-day notice. He argued that the thought behind them was to address issues in the future.

After a discussion of the City-County split of sales taxes and ABC revenue, Gupton told members that 51 of 85 North Carolina counties with a public library receive support solely from the county.

Ayscue countered that in those cases, the city did not build the library.

“I would be glad to hand you the deed right now,” Gupton said.

County Commissioner Scott Hughes suggested that the two governments need to meet “somewhere in the middle”. He said that if the County could take responsibility for the library, it would be a good step.

Gupton said that he thought it would be “great” to have an impartial study of all joint programs.

County Commissioner Tim Pegram said that he believed that the City instigated all of the joint programs. He said that he would hate to see “this” happen every time there is a new Board or City Council.

County Commissioner Terry Garrison, citing the example of a joint effort to develop an industrial park, said that the joint programs had proven to be beneficial. He asked City representatives if the City were “flush” if the conversation would be taking place.

“Yes,” Moss responded. He later stated that the funding arrangement had been questioned in every budget he had been part of developing, and that Henderson Mayor Clem Seifert had questioned it during his first term on the City Council.

Garrison said that the joint programs were bona fide legal arrangements and that he expected the City to follow them.

Moss argued that the contracts were not intended to run forever.

Garrison said that it was his intention [for his committee] to recommend to the Commission that it abide by the terms of the agreements in place. He said that there was no justification to change them.

“Perhaps members of previous City Councils did not know what they were doing,” Garrison said.

Gupton asked what the harm would be in investigating the issue, unless there was fear of what might be found. He added that he hated to see the discussion end “like this,” noting that “people” say [the two governments] can’t discuss anything.

“I was almost through with [the discussion] before I came to the first meeting,” Pegram said.

Henderson City Council member Ranger Wilkerson recommended the North Carolina Institute of Government as a suitable neutral party to conduct a study of the programs; however, County representatives did not commit to such an investigation.

City Council member Lynn Harper said that she supports joining the two governments and that she thought that in the issues to be covered that there would be compromise on both sides.

Harper said that the contracts were made based on the conditions at the time they were drawn.

“This is a different time,” Harper said.

Harper likened the City’s stance to Garrison’s stance on Medicaid relief for counties. Garrison rejected the comparison, saying that Medicaid funding by counties was mandated. He went on to say that counties had a financial basis for asking for relief.

After determining that Garrison’s representative district is entirely within the City of Henderson, Gupton asked Garrison “as a county resident” to look into the matter.