Board of Commissioners Budgetary Retreat Summary
The board discussed affordable housing, sustainability and major budget decision points
The Hillsborough Board of Commissioners met Saturday, Feb. 17 at the Town Hall Annex for the annual budgetary planning retreat.
The town manager’s recommended budget for Fiscal Year 2024-25 will be presented in May, followed by a required public hearing on May 28. The board expects to consider adoption of the budget on June 10. The new fiscal year starts July 1.
Following is a summary of noteworthy actions from the retreat. It does not include all actions taken at the meeting and should not be viewed as official minutes.
Community Survey
Administrative Services Director Jen Della Valle provided a preview of results from the 2023 Community Survey, highlighting results with significant changes of 4.5%. She said the town had another solid year of results and noted the 90% satisfaction in police protection is very high.
There was discussion about satisfaction dropping for availability of playgrounds, the town as a place to start a business, ease of travel by vehicle, and quality of social media outlets. The board asked staff to check the demographics for those responses to help determine factors behind the ratings. The full report is expected to be available later this month or in early March.
Strategic Plan
The Administrative Services director provided a quarterly update on the Strategic Plan, a three-year action-oriented road map implemented this fiscal year to align the town’s resources with priorities. She said the Administrative Services Department has begun working on employee engagement and wellness as a priority with the start of a committee.
Affordable housing
Assistant Town Manager and Community Services Director Matt Efird reviewed the strategy the board had adopted with the current budget to ramp up to earmarking 2 cents of the property tax rate — currently the equivalent of $326,000 — to affordable housing by Fiscal Year 2027. Board members affirmed continuing that strategy.
Efird also reviewed planned allocations for the funds. He noted completing a housing study and annual funding increases to the Orange County Partnership to End Homelessness could easily consume the banked funds instead of using them to build affordable housing units. Board members discussed escalating costs for construction and a need to look at county and town responsibilities, contributions to services not in town, and resources like Central Pines Regional Council to complete the housing study. It was noted that the lack of affordable housing stock is driving vouchers to be used outside of Orange County.
There was discussion on quarterly, in-depth board work sessions to develop an effective plan for using the affordable housing funds. The board affirmed support of the proposed topics and a desire for a standalone retreat for partner input. The board also discussed considering:
- A task force to engage residents and subject matter experts in developing a strategy.
- A consultant to shape an affordable housing strategic plan.
Climate and sustainability
The assistant town manager continued a discussion on climate and sustainability from the board’s Jan. 22 work session. There was discussion about taking additional action or changing strategy because only five fiscal years remain to reach the town goal of reducing carbon emissions by 80% by 2030. Possible strategies include participating in carbon offset programs, which would require added funding to clarify specific offset needs. A multi-year funding plan for climate and sustainability funds was presented to the board in January.
Town Manager Eric Peterson noted the Water and Sewer Fund has no funding reserved for carbon reduction efforts and suggested staff look at the most reasonable way to reduce carbon when moving forward with utilities projects.
Major budget decision points
Budget Director Emily Bradford led discussion on a list of capital improvement projects and other key requests. The capital projects review included discussion about considering naming rights and associated guidelines for projects like the planned Ridgewalk greenway for funding opportunities. Discussion in review of the operating budgets for the general, water and sewer, and stormwater funds included:
- A contract proposal from the Hillsborough-Orange County Chamber of Commerce to contract with the chamber for a merchants association to improve economic vitality of all businesses in town. The request will be added to the budget proposal for further deliberation.
- An update on meeting revised lead and copper mandates. The Utilities Department is in the inventory phase, and much of the town is excluded because many structures were built after the ban on lead in plumbing.
- A wastewater master plan study underway to keep the plant’s treatment under the limit of 3 million gallons per day.
The board expressed support for:
- Starting contracting processes now to have code enforcement work start July 1.
- Making the utilities administrative assistant request a full-time position and hiring for the position this fiscal year.
Employee benefits study
Human Resources Manager Haley Thore provided an update on an employee benefits study. She noted the town lags in dependent health premium costs for employees and needs to investigate several areas, including health insurance eligibility for retirees under 65.
Thore proposed using reserve funds from the town’s participation in the N.C. Health Insurance Pool to reduce monthly costs to employees to add dependents to their health coverage. She also proposed offering employees supplemental universal life insurance with a long-term care rider, noting whole life insurance was discontinued because of no enrollment.
The board:
- Supported the dependent health care and life insurance proposals.
- Asked staff to further investigate reducing employees’ dependent care cost for the Fiscal Year 2026 budget year.
