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HomeMy WebLinkAbout1983-06-29June 29, 1983 (Regular Night Meeting) = 'r23~ An adjourned meeting of the Board of Supervisors of Albemarle County, Virginia, was held on June 29, 1983, at 7:30 Y.M. in Meeting Room #7, County Office Building, Charlottesville, Virginia; said meeting being adjourned from June 15, 1983. Present: Mr. James R. Butler, Mrs. Patricia H. Cooke, Messrs. Gerald E. Fisher, J. T. Henley, Jr., C. Timothy Lindstrom and Miss Ellen V. Nash. Officers Present: County Executive, Guy B. Agnor, Jr.; County Attorney, George R. St. John; and Assistant Director of Planning, Ronald Keeler. Agenda Item No. 1: Mr. Fisher. The meeting was called to order at 7:35 P.M. by the Chairman, Agenda Item No. 2. Ordinance: Agricultural/Forestal Districts (Deferred from June 15, 1983). Mr. Fisher asked if the staff had a further report to make on this subject. Mr. Keeler noted that the Board had deferred action on adoption of this ordinance in the event that one of the property owners (since adoption of the "parent" ordinance) had decided to withdraw his application for inclusion in the district. A letter dated June 16, 1983, from Paul M. and Virginia Coleman, owners of C-Stock Farm, has been received requesting that their property not be included in the Totier Creek A/F District. Mr. Keeler also noted that a letter dated April 26, 1983, had been received from John L. Morris, Jr. asking that land known as "Morrisena be included in the Totier Creek A/F District. Mr. Fisher asked if there were any member of the public present who wished to speak. No one rose to speak. Mr. Lindstrom then offered motion to adopt "An Ordinance Creating Two Agricultural and Forestal Districts" as set forth in the writing included with the agenda packet, these districts known as the Totier Creek Agricultural and Forestal District, and the Hatton Agricultural and Forestal District, both as shown on the map posted on the wall to the f~r left of the Board table. Mr. St. John asked that the map be initialed as an official exhibit. Mr. Keeler said he would do that, but the staff would prefer that the ordinance be adopted listing the districts by those tax map and parcel numbers provided to the Board at an earlier meeting, but deleting Parcels 10 and 10B, on Tax Map 129, those parcels belonging to Paul and Virginia Coleman. Mr. Lindstrom said he would change his motion to state: Adopt the Ordinance known as "An Ordinance Creating Two Agricultural and Forestal Districts" including in that ordinance the parcels shown on a list of tax map and parcel numbers (which included Morrisena) with the exception of two parcels owned by Paul M. and ¥irginia Coleman, Parcels 10 and 10B on Tax Map 129. (Note: the ordinance as adopted is set out below.) AN ORDINANCE CREATING TWO AGRICULTURAL AND FORESTAL DISTRICTS BE IT ORDAINED by the Board of Supervisors of Albemarle County, Virginia, pursuant to Virginia Agricultural and Forestal Districts Act, and to the ordinance of this County made in accordance therewith, that there be, and thereby are, established two agricultural and forestal districts within the .County. The District known as "Hatton Agricultural and Forestal District" consists of the following described properties: County Tax Map 135, Parcels 13, 15, 1SA, 17,~18, 19, 22, 22A, 30; and Tax Map 136, Parcels 8, 9B, 10, 11, 13C, 19, 19B, 27; and the District known as the "Totier Creek Agricultural and Forestal District" consists of the following described properties: Tax Map 121, Parcels 70, 72C, 85; Tax Map 122, Parcels 2, 5; Tax Map 128, Parcels 19, 27, 27A, 28; Tax Map 129, Parcels 3, 4, 5, 6, 7A, 9, 10A; Tax Map 130, Parcels 1, 4, 5, 7, 7A, 11; Tax Map 135, Parcels 7, 10. The foregoing motion was seconded by Miss Nash and carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. Agenda Item No. 3. Public Hearing: Amendment to the Industrial Development Authority Ordinance - re: Increase number of bond issues (advertised in the Daily Progress on June 14 and June 21, 1983). Agenda Item No. 4. Public Hearing: Resolution to approve Industrial Bonding for Westbury Hall. (An application of Westbury Associates, a Virginia limited partnership, requesting the Industrial Development AUthority of Albemarle County, Virginia, to issue up to $6,000,000 of its elderly residential facility revenue bonds in acquiring, constructing and equipping a 108 unit elderly residential facility to be located on Pantops Mountain off of Route 250 in Albemarle County, to be known as Westbury Hall.) (Notice of this public hearing was advertised in the Daily Progress on June 14, 1983.) Mr. Fisher said the public hearings on these two items would be held concurrently. He asked if there was a member of the Industrial Development Authority present. Mr. St. John said that Mr. James Murray, Jr., Chairman of the Authority, had called him earlier to say that he could not be present tonight and that no member of the Authority would be present tonight. However, Mr. Murray feels that all pertinent information relative to the Westbury Hall request is set out in the inducement resolution adopted by the Authority on May 5, 1983. Mr. James Knicely, Attorney for the applicant from Hunton & Williams, is present. June 29, 1983 (Regular Night Meeting) Mr. Lindstrom noted that the Inducement Resolution and the Letter of Application both state that this project will be of benefit to the community by pro¥iding more housing for the elderly. Mr. Lindstrom asked Mr. Keeler if the County is in need of this type of housing. Mr. Keeler said it is recommended in the Comprehensive Plan that thirty-five percent of all new units be provided for low and moderate income, and elderly persons, but that percentage is not broken down into a specific number for each type of unit. Many of these types of projects must obtain a certificate of need from the State, and Mr. Keeler said he understands that many of these projects have not been realized because the State has not issued any additional certificates of need for this area in the recent past. Mr. Lindstrom asked ±f/the Westbury Hall project will require a certificate of need. Mr. Keeler said he knows absolutely nothing about the project in question, having seen the name identified on the Board's agenda only recently. ~ Nothing has been submitted to the Planning Commission for approval at this time. Mr. Fisher noted that in the sample resolution furnished, for the Board's approval, there is a sentence which states that "The Board hereby appro¥'es the issuance of the bonds by the Authority . . . and hereby further approves the location of the Project .... " He said he d±d ~ not think there had been any action by the Planning Commission on this petition. Mr. Lindstro~ noted that on the application it is stated that the zoning of the property is currently R-~5. He said that zoning has nothing to do with site plans or other approvals which may be required. Mr. Keeler said that is correct. ~ . Mr. Lindstrom requested that on future industrial bonding applications, where there a~e statements on the applications which pertain to specific, set goals in the Comprehensive Plan, that Mr. Agnor be sure that Mr. Murray obtain some statement from the Planning Department as to how the project will meet those stated goals. Mr. Fisher said he thought the Board had~ already asked for a preliminary planning review on this type of request. He then asked for ~' statements from the applicant Mr. Jim Knicely, Hunton & Williams, said this particular type of project does not require a certificate of need from the State because it is more in the nature of congregate care f~r the elderly. There will be no medical services provided, although there will be medical referrals. The project will have 108 units, a combination of two-bedroom and one-bedroom units. Mr. Knicely said that in reference to the statement in the resolution about the location of the project, the bond issue could be approved without that statement being include~ in the approval. July 1, 1983, is a significant date because a new State law goes into effect.~that date. The bond issue for this'proeJct is in the amount of $6,000,000 and is to~ be insured by HUD under Section 221(d)4 of the National HOusing Act. Federal law with respe~ct to tax exemption of the bonds requires that tWenty percent of the units in the project be set aside for persons making eighty percent or less of the median income in t~e County.. The developer is also required to keep this project as rental property for at least ten years, and possibly longer depending on the type of financing. Speaking next was Mr. David Goodman, representing Westbury ~ssociates, and a member of the limited partnership which will undertake construction of this project. Mr. Goodman said this project cannot be undertaken without industrial bond financing. He said the facade of this project is similar to Jefferson's Palladian style of architecture. The facade is con- structed using a French system which has been tried in Europe; it is pre-cast concrete molded Palladian arches with balconies. This is a seven-story building. The project is for elderly people who cannot live completely independently, but who do not need to live in a nursing home. As such, the project does not require a certificate of need from the State. There will be no medical services provided, but there will be a nurse to Provide emergency medical attention. There will be a central dining room serving three meals per day, housekeeping services, transportation into town, laundry service, a library, and a garden. There will be barbers, attorneys and other service providers ¥isiting on. aregular basis. There will be a separate service contract for those wanting to purchase these extra services; cost will be $260.00 per month per person. The proposed location of the project is on Pantops Mountain Just to the southeast of the proposed Riverbend Shopping Center. Mr. Goodman said the partnership had a feasibility study conducted in Central Virginia which showed that there are a large number of elderly persons who are incorrectly housed single-family dwellings. Many of these people move into life care projects where it costs from $45,000 to $80,000 just to move in, and then from $800 to $1,400 a month as a service charge. This project is for those persons ~et~een the one hundred percent subsidized unit and the life-care unit. Mr. Goodman said there is.'a large market for something other than the life estate type of facility. It has been determined that for thirty percent of the median income in Albemarle County, a person could be housed and have all the services provided except for medical services and clothing. Mr. Goodman said he believes this will be the way of future facilities for the middle income elderly. This project cannot be undertaken without the tax exempt bonds and there will be no exposure for the Board because these will be AAA 'i bonds. Mr. Fisher asked about the land on which the project will be located. Mr. Goodman said there are fourteen acres; seven are in the first phase of the project. The land is currently zoned R-15, located on Pantops Drive, and ~s developer has said that no special permit is~ required for the project. Mr. Fisher asked who sets the rents for the Project. Mr. Goodman said that initially the rents will be set by the Federal government. Twenty percent of these units have to be occupied by persons who are defined as low income by Section 8 regUlations except that the regulations are modified so that if a person earns eighty percent or less of the median income, they are eligible. FHA will set the rents and will also set the limit on any increase in cost of services. This will be an FHA controlled project. It is not a Federally subsidized project; it is internally subsidized by charging one tenant enough rent to offset what the lower income person cannot afford to pay. June 29, 1983 (Regular Night Meeting) 241 Miss Nash asked Mr. Goodman to explain what he had previously said about the facade of the building. Mr. Goodman said it is called a somag system and is copied from the French. It is very expensive to replicate in a conventional manner intricate architecture. The facade will be made in molds which will be imported from France. It is a system that has been successful in the past because it reduces costs while still maintaining a nice facade. Mr. Lindstrom said this is the ninth request for industrial bonding that this Board has received. He has strong feelings that these issuances are subsidized with public monies. He said since there is no competitive bidding for counsel fees, he would like to know how much of the actual cost of issuance of the bonds is for payment of bond counsel fees. Mr. Goodman said that bond counsel usually works on a percentage basis. Mr. Knicely said Hunton and Williams has not entered into an engagement letter with this developer, but usually works on an hourly basis. Mr. Goodman said that most of the issuance costs will pertain to marketing of the bonds. There are also rating fees. Mr. George Pugh, Senior Vice President, Craige, Inc. of Richmond, said the underwriters fees ~noted in the application are based on information provided to the developer about the average cost for bond counsel and the average cost of obtaining ratings industry wide. These items usually amount to about three and one-half percent of the project costs. That is also the amount that HUD will allow to be financed from the proceeds of an FHA insured mortgage. The amount is not fixed and is subject to negotiation between the underwriter and the developer Mr. Lindstrom said he believes that all applicants for industrial bonds in Albemarle County have been represented by Hunton and Williams. He asked Mr. Goodman how he happened to choose this firm. Mr. Goodman said that there are only two firms in Virginia which do the sophisticated work required for these bond issuances. Hunton and Williams is the bigger of the two firms. Mr. Pugh said his firm had recommended Hunton and Williams because they do a lot of this type of work in ¥irginia. Mr. Fisher asked how much real money the developers will put into this project. Mr. Goodman said it will be about $600,000. 'Mr. Fisher asked if the developers will ultimately own the real estate and be able to transfer that property. Mr. Goodman said yes. Mr. Fisher asked if the developers will be able to convert the property to condominiums in the future. Mr. Goodman said that under the laws governing tax exempt financing, the property cannot be converted from rental units for the longer period of ten years or one-half the life of the longest outstanding bond. If this should be a forty-year bond issue, that would be twenty years. The building is not really being designed for conversion. Mr. Fisher noted the proposed rents of between $378 and $850 per month. Mr. Fisher said he did not see any statements in the application qualifying those figures. Mr. Goodman said the developers took figures from HUD commitments in Richmond and trended those rents using HUb trend factors two and one-half years in advance. Mr. Fisher asked if these figures include food. Mr. Goodman said no; food and all services are estimated to cost $260 per month, per person. It is possible that HUD might reduce the projected rent figures. If that happens, the developers will have to put up more equity because the amount of money that can be borrowed is predicated on the net income that will be available for payment of debt service. Mrs. Cooke asked if the renters will have to pay for the extra services. Mr. Goodman said no. Mrs. Cooke asked Mr. Goodman's definition of low income. Mr. Goodman said the developers feel that the lower income people will live in the smaller units. Mr. Lindstrom asked if interest rates come down, will the rents be lowered. Mr. Goodman said the rents will move up or down according to the interest rates. Mr. Lindstrom asked if Mr. ~Goodman expects to realize a ten percent interest rate on these bonds. Mr. Goodman said yes. Mr. Fisher said he was interested in hearing how this project will fill a need in the County that-previous, similar applications will not. Mr. Goodman said he is famitar with all of the projects that have been approved thus far, and this project, Westbury~Hall, cannot be compared with a stick built, walkup townhouse or garden apartment. This will be the kind of place where a person can move to and not feel that he or she has been forced out of a single- family home. Mr. Goodman said he doubts that this project will attract people who are already living in apartments. Mr. Fisher said i'f all of the projects which have been approved are bui~lt, there would not be enough people to fill all of the units. Mr. Goodman said there is always the possibility that this project will not be successful, however, the developers are very site conscious when a community is picked for one of these projects. The developers feel it will be a project of highest quality and will not cost much more to construct than a project of mediocre quality. Mr. Butler asked how many similar units have be~n built in Virginia. Mr. Goodman said there are none in Virginia. The closest comparable units are those which have been constructed by Westminster-Canterbury. Mrs. Cooke asked where Mr. Goodman had other such projects located. Mr. Goodman said he does not have any projects that he has developed, but has many projects which he has helped finance. Mrs. Cooke asked if those projects are similar to this project. Mr. Goodman said no, those projects are all congregate care for the elderly units, but this project is unique. Mr. Lindstrom said he knows that the various Board members do not share the same view about industrial bonds. He is of the anchronistic view that tax exempt bond issues are only possible because there is less money going into the Federal Treasury. Because less money goes into the Treasury, all taxpayers pay a little bit more, so all taxpayers are to some extent subsidizing this project. Mr. Lindstrom said as long as he has this view, it is important for him to know there is some benefit to the people who will occupy the building that they would not get if the project were privately financed. Mr. Lindstrom said he knows that the full faith and credit of the County is not involved, but he would like to know that the project will create a true, unique benefit to Albemarle County or at least to the people ~who are going to live in the project. Mr. Goodman said it is true that the people all across the United States will pay a little more in taxes because of this project, but at the same tim~, Albemarle County will realize a substantial increase in its tax base. As for this project, it is not like a shopping center where the developer can hike up the rents. The rents for this project have been pushed as high as possible. June 29, 1983 (Regular Night Meeting) Mr. Fisher asked if the developers market survey showed that there are enough people within a reasonable distance to fully occupy this development. Mr. Goodman said a five county area was used for the survey, but the developers feel that seventy percent of the people occupying the units will come from a three county area. Miss Nash said that although she does not totally agree with Mr. Goodman, she feels it will be a valuable project if Mr. Goodman does what he says he will do. She said the service list is good. Mr. Goodman said the service list is not something to worry about. He and his associates do nothing but government insured projects. If this project goes bad, they will nol be able to d'o any more projects. The developers do not want to "feed" this project, but would rather feed it than go into a new line of business. Miss Nash asked who will enforce the covenants mentioned in the application. Mr. Goodman said HUD does. Miss Nash asked who will see that the developers do all of the things they say they will do~ Mr. Goodman said the developers are not proposing to provide all of these services because they are nice people, but rather because is was felt that these things must be provided in order to rent these units at the prices proposed. Miss Nash said these will be older people who probably will not want to fight if the services are not provided as expected. Mrs. Cooke asked if there is a contract for the services. Mr. Goodman said there is a separate service contract. If the developers don't provide the services promised under the shelter rent, the tenant can cancel his lease, call HUD and complain, or both. If the developers don't provide the services as specified in the service contract, the tenant can cancel the service. Mr. Fisher asked how long HUD will control the rents. Mr. Goodman said as long as the bonds are HUD insured. This will be a forty-year mortgate which can be prepaid after ten years, but the building cannot be converted to condominimums, and twenty percent of the units have to be held for lower income people for twenty years, or the bonds become taxable back to their issuance date. There is a bond trustee to protect the interests of the bondholders and that trustee will enforce the covenants. Also, the covenants will run with the property. Mr. Pugh said since there is a deed of the property, it would be impossible for the developers to pass the deed without the covenants, and nobody could buy the property and not preserve the twenty percent of the units for low income people. Mr. Knicely said the bond trustee is empowered to enforce the convenants and is also entrusted to protect the tax exemption for the bondholders. Mr. Fisher then asked if there were anyone else present who wished to speak on these two matters. No member of the public rose to speak. Mr. Knicely said that in reply to the question about what the unique, special benefits of this project would be to Albemarle that might not be provided by the conventional market;~'~ he would like to mention a couple of reasons. One, low income people have to occupy twenty~''~ percent of these units. In. the conventional market there is no such requirement. Two, there is a guarantee that this project will be used for rental housing for a substantial period of time. Three, it is a facility for the elderly, which is one of the categories listed in the industrial authority act. Finally, the development will have both HUD oversight and recog- nition by the Federal government in tax exemption and in housing costs. Mr. Lindstrom asked if the bonds are paid off early, if the trustee will still be ir Mr. Knicely said if the loan is paid off early, the developers will convey the land to the Industrial Development Authority. The Authority would then sell the project with the land, back to the developers. In that conveyance the Authority will place restrictive covenants, and the bond trustee will join in the deed conveying the property. Under Virginia law it is somewhat unclear as to whether these covenants run with the land or not because there are no adjacent properties which benefit from same. However, the people who will occupy the units in this building will benefit, as well as the people realizing the tax exemption on the bonds purchased. Whether or not the covenants run with the land, there is the doctrine called inequitable servitude which allows a contract to be forced when it touches and concerns the land. Mr. Knicely said the research of his firm is definite on the fact that as long as this is done in a conveyance, the covenants can be enforced by the Authority or its bond trustee on its behalf. Before the property is conveyed to any subsequent owner, the financing doc'u- ments require that those persons accept and adhere to the covenants that the original deveioper made. Mr. Lindstrom said he understood that, but asked if the bonds are paid off early, what. interest the Industrial Authority or the bond trustee will have in the property. ~Mr. Knicel~ said if the covenants are not adhered to, the interest income on the bonds becomes taxable~tO the individual bondholders; that is the bond trustee's interest. Miss Nash asked if the individual leases will contain reference to this overall umbrella of covenants. Mr. Goodman said the benefit to the person who lives in the building is that instead of paying about $600 a month for rent, he will be paying $400. That person really does not care why he is paying less rent, so there is no plan to make any reference as to why the rent is lower. Miss Nash said the individual tenants would have to dig up all this information if they wanted to sue. Mr. Goodman said the tenants are not the people Who woUld get hurt. Miss Nash said if she had a lease for two years and did not receive services, She'~ would be hurt Mr. Goodman said the services are not a part of the covenants. The fact that~ twenty percent of the units must be held for lower income people, and the fact that the building can't be converted to another use, are a part of the overall covenants. Everyone will agree that it would not be possible to charge these rents if the management is sloppy and the people don't receive the services for which they pay. These people will not have bought a life estate and will be able to move out. Miss Nash said it is not so easy for an elderly person to just pick up and move. Mr. Goodman said if the tenants do'not get. what has been promised, the tenants do not have to pay the rent, and cannot be evicted. Mr. Lindstrom said the fact that the rent will reflect the reduced interest paid on public bondS, and that twenty percent of the units will be held for lower income families, are the important factors to him. Those two facts will continue to exist because the IndUSt'r!i~ Authority has the right to enforce these convenants as long as the bond issue exists. Mr. Goodman said that is right. Mr. St. John said he disagreed with that statement and on beh~t~~' of Mr. James Bowling who is counsel for the Authority, he wanted to make clear that he does~ not believe the Albemarle County Industrial Development Authority has any responsibility to enforce these covenants and does not assume or accept that responsibility. The Industrial June 29, 1983 (Regular Night Meeting) 2:4,3 Authority is purely a conduit for financing. Mr. Knicely said that different authorities assume different roles. Typically with an industrial authority being more in the nature of a conduit for financing, the Authority often delegates the responsibility for enforcement to the bond trustee. Frequently the mortgage banking firm will serve a monitoring role on behalf of the trustee to provide the regular reports that are necessary for the enforcement of the covenants. The Authority would have the right to enforce the covenants if it so chose, but in this instance the documents will delegate that responsibility to the bond trustee. Mr. Lindstrom asked if there has been any actual experience with the covenants in a jurisdiction similar to Virginia. Mr. Pugh said this type of financing, with the low income requirements, has only been in effect since the passage of TEFRA - mortgage subsidy bonds. Mr. St. John said there have been cases where bonds having been issued and purchased by innocent purchasers, and someone along the way had made a mistake, the bonds became taxable. The industrial development authority is not responsible for that. The bond counsel, the underwriters, the trustees, the counsel for the trustees, all may be liable, but the industrial authority and its personnel, individually and officially, have no responsibility. The Authority does not accept any responsibility for these covenants or the tax exempt status of the bonds. Mr. Goodman said the corporate trustees will be Virginia National Bank or United Virginia Bank. Mr. St. John said at the May 10 meeting of the Authority when the inducement resolution for this issue was approved, the Industrial Authority refrained from even asking these questions which the Board is now asking for the very reason that they did not want to become responsible for any of this. The Authority approved this issue because other similar projects have been approved and they could not distinguish this project from the others. Mr. Butler said if the Industrial Authority is not responsible, someone has to be responsible to see that the public is protected. Mr. St. John said there are two or three segments of the public involved. There are the people who will buy these bonds and the Authority has no responsibility to them. For the people who buy the bonds, their agents and representatives are responsible. The people who will occupy'the building are another class of people, and they are the people to whom Miss Nash is referring. Mr. Lindstrom is talking about the actual structure of the bonds. Mr. St. John said he does not feel that the County is respon- sible for either of these classes of people. Mr. Fisher said since HUD will control the rents of these units for a period of time, that is one difference between this application and several of the applications which have been approved. That is the difference between this application and other commercial enter- prises where the industrial bonds are just a windfall for the developer. Mr. Fisher said if there was no one from the public to speak, he would close the public hearing at this time. No one rose to speak. Mr. Lindstrom said he would agree with Mr. Fisher's analysis. He would Just like to know if there is a reasonable expectation that if the developer prepays the bonds, that there will be someone to see that the covenants are adhered to. The covenants make this project something which he can vote in favor of because he feels there is a unique benefit to the public over and above other such projects. Mr. Lindstrom then offered motion-to adopt an ordinance to amend and reenact Section 2-52, Article IX, Chapter 2, of the Code of Albemarle relating to the limitation on number of bond issues of the Industrial Development Authority, as follows: AN ORDINANCE TO AMEND AND REENACT SECTION 2-52 ARTICLE IX, CHAPTER 2, OF THE CODE OF ALBEMARLE RELATING TO THE LIMITATION ON NUMBER OF BOND ISSUES OF THE INDUSTRIAL DEVELOPMENT AUTHORITY BE IT ORDAINED by the Board of Supervisors of Albemarle County, Virginia, that Section 2-52 of the Code of Albemarle is hereby amended and reenacted as follows: Sec'. 2'-'52. Limitation on number of bond issues. There shall be no more than nine bond issuances of the Industrial Development Authority of the county in existence at any one time. The foregoing motion was seconded by Mr. Butler and carried by the following recorded vote AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. Mr. Lindstrom then offered motion to adopt the required resolution, but amending the language in the Paragraph numbered (1) by deleting the words "hereby further approves the location of the Project as required by Section 2-51 of the Albemarle Oounty Code". Mr. Lindstrom said he felt this should be left completely to the normal planning process since Mr. Keeler knew nothing about this application and since Mr. Knicely has stated that it is not critical to approve the location anyway. Mr. St. John said that in the past, the approvals given by this Board referred to some location, even if some future zoning action were required, but the approval did not include any zoning clearance. The Industrial Development ordinance says that a project cannot be constructed until the Board of Supervisors has approved the type of project and location of same. Mr. St. John said he did not want the Board to have to come back after July 1 to finish the approval of this project. Mr. St. John said the language in the resolution does not approve any particular site plan, it only approves the project in this area instead of some- where else in the County. 244 June 29~ 1983 (Regular Night Meetin~ Mr. Fisher said he thought the last time the Board reviewed one of these applications, the Board had asked that the Planning Staff review and make a report on these projects as to zoning, location in growth areas, etc. He guessed that request had slipped by. Mr. St. John said he would like to suggest that the resolution be adopted as presented, but in the presence of these gentlemen (and so it can be recorded in the minutes of this meeting) state that no' ? zoning change or site plan approval is involved in this approval. In other words, the developers do not get a vested right to any special use permit or rezoning if that should b~ required. Mr. Lindstrom said he would have no problem following Mr. St. John's suggestion, but hoped that before the next go round with the Industrial Authority Mr. Agnor would get the Authority coordinated with the Planning Staff and get some language in these resolutions that makes it clear that when the Board adopts the resolution, the Board is not approving an actual site. Mr. St. John said he did not think the Board would want to approve an issuance without knowing the general location, just carte' blanche. Mr. Lindstrom said he would have no problem with that as long as the request were subject to subsequent zoning and site plan action by the Planning Commission, etc. Mr. Lindstrom said he Would like to withdraw his motion and put forth another motion that the Board adopt the resolution approving the Westbury Hall project without any modifications, but with the understanding that the project is subject to the full panoply of County planning and zoning regulations. Mr. Butler seconded this motion. The motion carried by the following recorded vote: 'AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. (Note: The resolution as adopted is set out below.) WHEREAS, the Board of Supervisors (the "Board") of Albemarle County, Virginia (the "County"), has held a public hearing on June 29, 1983, to consider the issuance by the Industrial Development Authority of Albemarle County, Virginia (the "Authority"), of its elderly residential facility revenue bonds in an amount up to $6,000,000 (the "Bonds") to assist Westbury Associates, a Virginia limited partnership to be formed by John K. Hoskinson, Robert E. Davis, Allan D. McKelvie and David L. Goodman (the "Owner"), in financing the acquisition, construction and equipping of a 108-unit elderly housing project (the "Project") in Albemarle County, Virginia; and WHEREAS, Section 103 (k) of the Internal Revenue Code of 1954, as amended, provides that the governmental unit having jurisdiction over the issuer of industrial development bonds shall approve the issuance of such bonds; and WHEREAS, the Authority issues its bonds on behalf of the County and the Board constitutes the highest elected governmental body of the County; and WHEREAS, Sections 2-50 and 2-51, Chapter 2, Article IX of the Albemarle County Code require that the bonds cannot be issued without prior approval by the Board; and WHEREAS, a copy of the Authority's resolution approving the issuance of the Bonds, subject to terms to be agreed upon, has been filed with the Board BE IT RESOLVED by the Board of Supervisors of Albemarle County, Virginia: 1. The Board hereby approves the issuance of the Bonds by the Authority to the extent required by Section 103 (k) of the Internal Revenue Code of 1954, as amended, and by Section 2-50 of the Albemarle County Code, to assist the Owner in the financing of the Project, and hereby further approves the location of the Project as required by Section 2-51 of the Albemarle County Code. 2. The Board hereby amends Section 2-52 of the Albemarle County Code to i~crease the number of bond issues permitted by such Section to nine. 3. The approval of the issuance of the Bonds does not constitute an endorsement to a prospective purchaser thereof of the creditworthiness of the Project or the Owner but, as required by Section 15.1-1380 of the Code of Virginia of 1950, as amended, the Bonds shall provide that neither the County nor the Authority shall be obligated to pay the Bonds or the interest thereon or other costs incident thereto except from the revenues and monies pledged therefor and neither the faith or credit nor the taxing power of the Commonwealth of Virginia, the County, nor the Authority shall be pledged thereto. 4. This Resolution shall take effect immediately upon its adoption. Mr. Fisher asked if the Board would like to consider setting up a formal procedure for future Industrial Authority requests. He said any staff report would not have to be detailed, but should provide some preliminary information as to the proposed site, need, and compliance with the Comprehensive Plan. Motion to this effect was offered by Mr. Lindstrom, seconded by' Miss Nash, and carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. At 9:15 P.M., the Board recessed, and reconvened at 9:25 P.M. JUne 29, 1983 (Regular Night Meeting) -245 Agenda Item No. 5. Appropriation: 208 Watershed Management Grant. Mr. Agnor said these are funds from an EPA grant which came through the State Water Control Board and were to be used to monitor runoff from the South Fork Rivanna River reservoir area. The funds are to pay for the additional work performed by the consultant F. X. Browne & Associates. A request for disbursement has already been received since the 208 project is now completed. Motion to adopt the following resolution was offered by Mrs. Cooke, seconded by Miss Nash, and carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. BE IT RESOLVED by the Board of Supervisors of Albemarle County, Virginia, that $7,000 be, and the same hereby is, appropriated from the Grant Fund and coded to 9302-5841, Watershed Management, for payment to F. X. Browne & Associates on the 208 Watershed Study. Agenda Item No. 6. Agreement: Route 29 Transit Service. Mr. Agnor said he has never been sure that the Board needed to approve agreements such as this when the funds are already allocated in the operating budget and the agreement does not change. This agreement is identical to the last agreement with two exceptions: 1) the cost is less than anticipated; and 2) the one-hour headways are being changed to thirty-minute headways on July 1. Mr. Agnor said the Board should authorize him to sign this renewal agreement for one more year. Mr. Lindstrom said although it appears that the County is subsidizing more than it is providing for County citizens, he would offer motion to authorize the County Executive to sign this renewal contract, as long as the County can get out of the contract in a reasonable time period. Mrs. Cooke seconded the motion which carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. THIS AGREEMENT made this 30th day of June, 1983, by and between the County of Albemarle, Virginia ("the County"), and the City of Charlottes- ville, Virginia (the "City"). W I TNE S SET H WHEREAS, Albemarle County desires to enter into an agreement with the City of Charlottesville to provide mass transit service for that portion of U. S. Route 29 between the City limits and Albemarle Square Shopping Center; subject to certain terms and conditions; and WHEREAS, the County Executive of Albemarle has been authorized to enter into this Agreement by the Board of Supervisors of Albemarle County; and WHEREAS, the City Council of the City of Charlottesville has authorized the City Manager to enter into this Agreement, NOW THEREFORE, in consideration of the mutual promises and obligations of each as hereinafter set forth, it is mutually agreed as follows: l) The City, through Charlottesville Transit Service, shall provide bus service between the downtown area of the City of Charlottes- ville and Albemarle Square via the extension of the CTS Route 7. The service will operate on thirty (30) minute headways six (6) days per week Monday through Saturday between the hours of 6:30 a.m. and 6:30 p.m. Subject to the City's other equipment and manpower commitments, upon seven days prior written notice to Albemarle County, reasonable modifications may be made in the proposed bus schedules which are shown in the attached exhibit which vary the times of service and/or routes. 3) In order to provide satisfactory services, the City shall provide, operate and maintain buses suitable for such operation. The City shall also provide the personnel to operate and maintain the buses, and the City shall have full control over and be responsible for the hiring and supervision of such personnel, as well as for the payment of all salaries and wages, and all other employee benefits of such personnel. The City shall provide liability insurance coverage in the same amount as it provides for operations within the City limits. The City agrees to indemnify and hold harmless the County against and from any and all claims, damages, costs and expenses because of bodily injury or death of persons or damage to or destruction of property, or for any other cause, resulting from or arising out of the City's negligence in connection with its performance under this agreement, provided such indemnification is limited to the extent of the aforesaid liability insurance coverage. 5) The City shall have no responsibility for the creation, maintenance or upkeep of any parking facilities related to this service. June 29, 1983 (Regular Night Meeting) 6) The City shall be compensated for the service to the County as follows: a) Fares The City shall charge the following fares for transportation service provided during the term of this agreement: (1) Forty cents (405) regular fare. (2) Twenty cents (205) elderly and handicapped fare. The City shall be entitled to keep all fares collected. b) Payment by County The County will pay the City a total of $17,456 for the term of the contractual agreement. Payment is to be made in monthly increments of $1,454.67. The payments are to be made on the first day of each month, without demand. 7) If the City shall fail to comply with its undertakings herein and such failure shall continue for ten days after written notice from Albemarle County specifying such failure, then the County may ter- minate this Agreement, provided however that the City shall incur no financial liability of any kind arising out of such termination or in any event under any provision of the entire Agreement. 8) In addition to the rights of termination provided herein, either party shall have the right to terminate or suspend service by giving 30 days written notice to the other party of its intentions to do so, provided however, that the City may suspend such service imme- diately upon written notice to the County that the City does not have sufficient fuel to perform its obligations herein. The City's determination as to whether it has sufficient fuel shall be prima facie evidence of the sufficiency of fuel. 9) The failure of either party to observe and perform its obligation hereunder shall not be deemed a default or breach hereof if such failure is the result of fire, explosion, flood, work stoppage, riot, communications or power supply failure, failure or malfunction of equipment or other cause beyond the party's control. But written notice of such cause shall promptly be given by it to the other. Neverthless, if any failure so caused has continued or clearly will continue, for a period of at least 30 days, the party entitled to notice hereof may, by written notice to the other, promptly given terminate this Agreement as of the date specified therein. 10) No waiver, alteration, or modification of any of the provisions hereof shall be binding unless in writing and signed by a duly authorized representative of the parties hereto. Except as herein expressly provided to the contrary, the provisions of this Agreement are for the benefit of the parties hereto and are not for the benefit of any other person and any assignment of this Agreement by either party without written consent.to the other shall be void..' 11) The term of this Agreement shall be for twelve (12) months, commencing July 1, 1983, and ending June 30, 1984. 12) This Agreement shall be governed by laws of the Commonwealth of Virginia. The undersigned represent that they have authority to execute this Agreement on behalf of the respective parties. Agend~'~'~t!~m N0~;:~'Ta4 ~: ~Poli~'en'~.:'i~;:~-~Th'~ma;~:i.:.~!efferson Housing Improvements Corporation Board. Miss Nash said- she has had several people suggested to her for this Board, but she has not had a chance to speak with any of them at this time. Agenda Item No. 7b. Appointment: Jail Board. No nominations were made. Mr. Lindstrom and Mrs. Cooke both felt that all vacancies on boards and commissions should be advertised requesting applications from interested citizens. A short discussion followed, and Mr. Lindstrom then offered motion to advertise for applications, set a deadline as to when applications will be taken, forward applications received to the Board with items for the first meeting in each month, at which time the Board will tell the Clerk which persons to call for an interview at the second meeting in the month. It should be made clear in the advertisement for applications that all applications will be released to the public if so requested. The motion was seconded by Mrs. Cooke and carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. June 29, 1983 (Regular Night Meeting) 24? Agenda Item No. 8. Appropriation: School Fund. Mr. Agnor noted the following memorandum Jones, Director of Finance, dated June 22, 1983, entitled "Accruals of Fringe from Ray B. Benefits - Education Department". "In previous years, the employer fringe benefits (FICA, Retirement, Life Insurance) costs on eleventh and twelth month paychecks of ten month employees in Education have not been accrued as an expense in the fiscal year in which the expense was incurred, but deferred to the succeeding year. This was due to the fact that payment of these costs was made in August and September. Based on the '45 Day' Rule of municipal reporting, no accrual was required. Recent communications from the Auditor of Public Accounts and conversations with the current Audit Managers (Price Waterhouse) confirms that these fringe costs must be accrued in the current fiscal year 1982-83. The monthly statements are currently showing these amounts as encumbrances to be liquidated on June 30 along with the salary amount of the eleventh and twelth month paychecks. The paycheck amounts have been accrued in prior years but not the fringe costs. The paychecks were actually printed on June 30 in previous years and recorded as "Warrants Payables" in the annual statement. The current requirement of reporting emphasizes those 'costs known and measureable' in addition to the '45 Day' rule. Therefore, these fringe costs, which will amount to over $400,000 (17G-Fixed Charges) for Education, will appear as an overexpenditure if no action is taken. The end result of the reporting change will actually reflect an extra month's fringes in the FY 82-83 annual statement. Since this problem is the result of a change in the requirements of account- ability and reporting, I feel the Department of Education cannot be expected to absorb this expense. In fact, I do not feel it is possible for the Department of Education to absorb it. They will be fortunate to absorb the cut-backs in State Funding for FY 82-83. Therefore, I request the following appropriation from the Balance of the General Revenue Sharing Fund for the Fiscal Year 1982-83: FROM: 9800-9999.99 Federal Revenue Sharing Unallocated Balance $404~620.46 TO: 17G-295.01 FICA 17G-295.02 VSRS 17G-295.03 Life Insurance $191,292.06 198,348.32 14,980.08 $404,620.46 In order to meet the advertising requirements and Federal Revenue Sharing Regulations, the above appropriation must be advertised as a Budget Amendment and designated as Planned Use of Revenue Sharing Funds for the Fiscal year ending June 30, 1983. This can be accomplished by authorizing the adver- tisement and setting the public hearing at your June 29 meeting and finalizing the appropriation in July. If no action is taken, the expenditures will show in the Financial Statement and Audit as an 'Expenditure in Excess of Appropriation' as well as add to the current deficit of the School Fund because the fringes are 'known and measurable' prior to June 30. As you may know from the above, the amounts of the eleventh and twelth month paychecks for ten month employees has grown to where it now represents about $1,427,500 in deferred salaries plus over $400,000 in fringe costs. These amounts are increasing about 20 percent each year. My recommendation recognizes the change in accountability and also recognizes that this will reduce immediate funds available for capital projects, however, I am of the opinion that this is the best way to solve the problem. I would not recommend further large reductions in the General Fund balance which is down to a point where all of it will be needed as operating capital. Also, the use of Revenue Sharing Funds does not jeopardize future allocations of Revenue Sharing monies like the use of General Fund monies. Due to the complexity of payroll reporting and the increasing accrued liability, some localities have done away with this payroll option. A few localities have placed everyone on a twelve-month contract specifying the numbers of days to be worked. Having the option as we now have it does make the accountability more complex because you have a dual payroll system. I request your official action on the advertisement, public hearing and appropriation to solve this problem." Mr. Lindstrom asked if this will catch up accruals on fringe benefits so that this will not occur again next year. Mr. Agnor said yes. Mr. Fisher was surprised that the fringe benefits for just part of the school employees for just two months is over $400,000. Mr. Agno~ said that is correct, and this is just on contract employees. At this time, motion was offered by Mrs. Cooke, seconded by Mr. Henley, to advertise a budget amendment as recommended by the Director of Finance for July 13, 1983. The motion carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. June 29, 1983 (Regular Night Meeting). Mr. Agnor mentioned to the Board that the new auditing firm (Price Waterhouse) has said that only those items on which an invoice has been received should be encumbered; and not to encumber at the time a purchase order is issued. Mr. Fisher said he would like to see somethin on this change in writing. Mr. St. John said he does not think this is a legally sound principal because when the order is placed, it is put into the vendor's power to legally bind the County to pay for those goods. Mr. Agnor said the auditors are not prohibiting the County from encumbering purchases during the year, but have said that at the end of the fiscal year, any item that has been ordered but not received will be charged against the fiscal year in which it is paid for. That is different from the way the County has been keeping track of purchases. Mr. Fisher said he would like to know a little more about this change. Agenda Item No. 9. Transfers: School Fund. Mr. Agnor said this information was not available at this time, and referred to a memorandum from Ray B. Jones, Director of Finance, dated June 24, 1983: "For the past several months, the Finance Staff in Accounting has been manually monitoring the accounts payables prior to issuing the checks. However, it is impossible to project the costs of electricity, gas, water, sewer and telephone services prior to receipt of the statements. We will hold the June 30 accounts open until June invoices are received in mid-July in order to properly make the necessary accruals of expenditures and revenues. The regular payroll for June will be processed today. The eleventh and twelth month paychecks will follow as soon as possible but not be signed until the end of July and the end of~AUgust. By the middle of next week, it is expected that we will have a preliminary end-of-year print-out of expen- ditures. However, the State has already notified us that some current' year's State revenues will be received later than usual in July. The delay is due to the fact that the last payment will be adjusted to the actual enrollmenti figures which will adjust Basic Aid and fringe cost reimbursements to the County. I talked with David Papenfuse on June 21 to see if he had any ideas on $~a~s.fers. He requested that we hold off until June's bills were in for Transportation (17D) to determine the unexpended amounts available for transfer to other areas. Therefore, accurate figures to properly determine the end-of-year appro- priation transfers necessary and end-of-year fund balances will not be available until the latter part of July. The auditing firm has set'a target date of July 29 to close out the books for 1982-83. Any figures that could be furnished at this time would only be estimates that would have to be adjusted later when all of the above information is available. Therefore the final transfer requests will have to be made at a later date." Agenda Item No. 10. Lease: Little League Field from Uniroyal..Mr. Agnor said that for a number of years, the Uniroyal Company has provided playground area adjacent to the Scotts- ville School for school purposes. When the School system abandoned the school property, the County Parks and Recreation Department began using same and the Uniroyal people have just become aware that the public is still using the~property. The legal staff for Uniroyal has become nervous about the liability of that use. A lease for the property has been reduced to writing and reviewed by the County Attorney. The County as landlords, will include this property in the County's insurance policy. It is a thirty-day agreement, and requires payment of $10 per year in recognition of the fact that it is a written agreement. Motion was offered by Miss Nash to authorize the County Executive to execute the following agreement: "THIS AGREEMENT made on 30th day of June, 1983, between UNIROYAL, Inc., ("UNIROYAL~), a New Jersey corporation, ("Landlord"), with an office at Benson Road, Middlebury, Connecticut, 06749, and Albemarle County, Virginia, with an office at 401 McIntire Road, Charlottesville, Virginia, 22901-4596 ("Tenant"). 1. The term of this agreement shall be from month to month commencing June 1, 1983. 2. Landlord demises to Tenant the premises shown on the sketch attached hereto and incorporated herein. 3. Landlord agrees to provide access to the demised premises at all times. The premises are to be used only for recreational purposes as a baseball field primarily for Little League competition. 4. Tenant shall pay UNIROYAL as rent ten ($10.00) dollars per year in advance on the first day of each year during the term of this lease. 5. Tenant will indemnify Landlord against any and all loss, liability, cost and expense resulting from the use or occupancy by Tenant of the demised premises and Tenant will provide and maintain during the term of this lease general liability insurance insuring the liability of Landlord and/or Tenant including the contractual liability of Tenant under this Lease with a combined single limit of not less than $500,000 for injury to any one person and for all persons and for property damage. Evidence of such insurance will be delivered to Landlord which will provide that said insurance cannot be can- celled without ten (10) days prior written notice to Landlord. J~ne 29, 1983 (Regular Night Meeting) vote: AYES: NAYS: 6. During the term of this agreement, UNIROYAL shall not be liable to Tenant and to Tenant's employees, patrons or visitors, or to any other person, for damage to person or property caused by, or resulting from the use or occupancy of the demised premises and the appurtenant and common facilities by Tenant, its agents, servants and employees, or neglect of Tenant, and Tenant agrees to hold UNIROYAL harmless from all claims for any such damage. 7. Tenant will also reimburse Landlord for the cost of repairing any damage to the demised premises. 8. Landlord will supply the following utilities only: NONE. 9. This agreement may be cancelled by either party by giving thirty (30) days prior written notice to the other party." The foregoing motion was seconded by Mr. Lindstrom and carried by the following recorded Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. Agenda Item No. 11. Renew Contract re: Operation of Keene Landfill. Mr. Agnor said this work was bid by the County Engineer and Stuart Tapscott was the low bidder. The bid is within the budgeted amount and the papers are ready to be signed. Motion was offered by Mr. Henley, seconded by Miss Nash, to authorize the County Executive to sign the bid proposal (specification for the operation of Keene Landfill - SLF-2) prepared by the office of the County Engineer, showing the amount of proposal as $61,500.00 and running from July 1, 1983, through June 30, 1985, and signed by Stuart Tapscott~on June 7, 1983. The motion carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and MiSs Nash. None. Agenda Item No. 12. Other Matters Not Listed on the Agenda. Mr. Fisher noted that he had received confirmation that the School Board will meet with the Board of Supervisors on Wednesday, July 6, at 4:00 P.M. in Meeting Room #5. Mr. Fisher said the two bodies will discuss the jointly operated parts of the School system, including summer school, and also redistricting plans. This is to be an informational meeting and no action is anticipated. Mr. Fisher noted that he will be attending the NACo Annual Meeting in Milwaukee from July 15-19. If he is so authorized, he can cast the County's ballot. Motion to appoint Mr. Fisher as voting representative for Albemarle County was offered by Mr. Butler, seconded by Mr. Lindstrom, and carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, Messrs. Fisher, Henley, Lindstrom and Miss Nash. None. Mr. Agnor said that for several years he has discussed the need for a personnel person for the County. However, he did not feel the County government was of a sufficient size to justify hiring a full-time person. He discussed this need with Clarence McClure, former Superintendent of Schools, and two years ago with Dr. Carlos Gutierrez when he first became Superintendent. A person has recently been selected to take that full-time position for both the Schools and general County government. Mrs. Martha Hammett, the present County employee, will be placed in that office. Mr. Lindstrom asked if Mrs. Hammett will have a title with the School Department, Mr. Agnor said Mrs. Hammett will remain a personnel ~technician and will remain on the County payroll. The new Superintendent for Personnel is Dr. Carole Hastings and Mr. W. T. Lewis has been appointed as Dr. Hastings assistant. Mr. Fisher asked if Mr. Agno~ felt this arrangement would work. Mr. Agnor said he did not know for sure, but he believes it will work. It has been difficult in the past because Mrs. Hammett was the single employee under Mr. Agnor's dire6t supervision. When Mrs. Hammett was out of the office, the office ceased to function. Mr. Agnor said he mentions this tonight, because when the School Board appointed Dr. Hastings Monday night, the School Board was concerned that the Board of Super- visors might not know of this plan. Mr. Agnor said he has mentioned these plans periodically over the past several years to this Board, principally during budget work sessions. The County has central purchasing and there is no reason why central personnel will not work efficiently for all concerned. Agenda Item No. 13. Adjournment. At 10:22 P.M., motion was offered by Mr. Lindstrom, seconded by Mr. Henley, to adjourn until July 6, 1983, at 4:00 P.M. for a meeting with the School Board. The motion carried by the following recorded vote: AYES: NAYS: Mr. Butler, Mrs. Cooke, MeSsrs. Fisher, Henley, Lindstrom and Miss Nash. None.