Commissioners Support Housing, Conservation Bonds - TribPapers
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Commissioners Support Housing, Conservation Bonds

Commission candidate Don Yelton told those at the dais he wasn't going to stick around for the meeting. Instead, he was going to go knock on doors telling people about their support for floating $70 million in affordable housing bonds to be backed by property taxes.

Asheville – Pegeen Hanrahan oriented the Buncombe County Commissioners to the prospect of holding what was billed as a bond referendum for affordable housing this year. Hanrahan is the Southeast Conservation Finance Director for the Trust for Public Land (TPL). It only took a few minutes into the presentation, before it seemed that the report on conservation easements had been mislabeled.

She explained the TPL was first invited to the county to discuss a feasibility study for fundraising strategies towards preserving open space, natural lands, and farmland. The study was funded through grants from the Merck Family Fund and the Doris Duke Charitable Foundation. Both organizations support conservation, but the latter also funds concepts for establishing equity. Funding affordable housing got folded into the mix because, as Hanrahan explained, people want to live near the area’s natural amenities.

Hanrahan specializes in designing bond referendums; others within her organization work as lobbyists. Since 1996, Hanrahan and her colleagues across the country have shepherded 610 bond referendums – for parks, land conservation, trails, and schoolyards – to voter approval.

The feasibility study for Buncombe County, now completed, mostly emphasized profiling the community politically, but some effort was also made to consider finances. Hanrahan said the best option would be to float bonds backed by property taxes. She focused on the impact of a $30 million bond for conservation plus a $40 million bond for affordable housing, even though those numbers were on the low extreme of the chart that she presented. Debt service on the $70 million total would amount to just over one cent on the tax rate, or an additional $32 per year for the average homeowner.

Hanrahan said the numbers represented the worst-case scenario, with interest rates at 4% and no consideration made for intended population and commercial growth. She said she would defer to County Manager Avril Pinder to elaborate on scenarios in which the tax rate wouldn’t have to increase so much. The conversation, however, didn’t circle back.

The irony was not lost on Don Yelton, who spoke during public comment at the subsequent meeting. He said the rich people wouldn’t be concerned about paying more money, but perhaps the commissioners should look at the residences of their constituents “in the holes and hollers.” He explained, the small amount would likely marginalize some multigenerational Buncombe residents living on fixed incomes, as it would some low-income tenants whose landlords have to raise their rent rates to cover the tax increases.

Hanrahan then moved onto the results from the polling. She said responses to polls on issues, unlike those on candidates, are usually analogous to the results on Election Day. She wanted the referendums to be held this year because gubernatorial election years usually have a fairly large turnout. These higher percentage of voters are more concerned and are more supportive of issues on the ballot than in presidential election years.

The first poll question read, “Shall the order authorizing thirty million dollars of bonds plus interest to pay the capital costs of acquisition and improvement of land or interests therein for conservation and protection of natural resources and preservation of farmland, including, but not limited to, the development of greenways and trails for recreation purposes, and providing that additional taxes may be levied in an amount sufficient to pay the principal of and interest on the bonds be approved?” Of the 400 respondents, 71% replied, “Yes;” 51%, “Yes, strongly.” All specific areas suggested for spending, even “helping combat climate change,” polled well, with between 52% and 62% of respondents strongly supportive, and 76% to 89% overall supportive.

The second didn’t poll as well. It carried, though, with 63% responding “Yes;” and 39% at “Yes, strongly.” It read, “Shall the order authorizing forty million dollars of bonds plus interest to pay the capital costs of housing for the benefit of persons of low or moderate income, including construction of related infrastructure improvements and the acquisition of related land and rights of way, and providing that additional taxes may be levied in an amount sufficient to pay the principal of and interest on the bonds be approved?” Hanrahan conceded the drill-down questions for affordable housing expenditures weren’t as informative as those for conservation easements, merely due to her lack of subject-matter expertise.

Next steps for TPL will be to work as a pursuit team, to gear messaging and generate interest among local groups. Pinder said the commissioners would have to vote on whether or not to support the bond referendum at their May 3 meeting, due to a multilevel schedule of deadlines for getting the item on the ballot. As an afterthought, Hanrahan shared it was not unusual for local governments to use bond revenues to leverage state and federal matches.

In Other Matters –

CFO and Finance Director Don Warn reminded the commissioners of a policy they adopted in 2020 stating that any fund balance in excess of 20% of general fund expenditures should be transferred to the county’s capital fund. For the current fiscal year, it appears the county will be able to make a $15,172,602 transfer from a year-end fund balance of $81,617,739.

Warn next presented a list of $8,459,624 in projects that he had been considering funding with debt. Most were for building repairs, but voting machines and grounds improvement were also included. By paying cash, Warn said the county could save $3,500,000 in interest. Funds could also be applied to the FY2022-2023 budget, where they would finance new vehicles, library projects, implementation of the Recreation Services master plan, upgrades to the Public Safety Training Center, and electric vehicle charging stations.

The commissioners balked, but Warn said he needed a decision “now,” because he was working up the bond documents. The vote was unanimously in favor of upholding the policy.

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