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Council Discusses Capital Improvement Plan; Beach Nourishment Tax Districts

Managing Editor

CAROLINA BEACH - The Carolina Beach Town Council met Friday May 11th, to continue discussions on preparing a budget for the upcoming 2012-2013 fiscal year.
Councilman Steve Shuttle worth raised the issue of holding a workshop on the Town's Capital Improvement Plan to address long-term goals of improving infrastructure throughout Town.
Shuttleworth explained to Town Manager Tim Owens, "A bigger picture. I was queried on why we look at small band-aid deals when we have the option" to look at a more significant capital plan. He added, "If we are getting a quarter point on money in the bank, why would now not be the time to look at a more significant capital plan. To give you direction so you have a clear road-map."
Shuttleworth was speaking of infrastructure issues such as aging water and sewer lines, new fresh water wells, the aging ground level water storage tank on Cape Fear Blvd, and other projects that have been on the drawing board for several years.
Owens explained, "It's kind of overwhelming right now... if you don't compartmentalize it. That's the way I operate I guess. You've got all the utilities underneath, You've got the sewer you have to take care of, you have to check it out, make sure if you have to line it or not line it, then put a water line in and then resurface a roadway."
Owens said he is trying to put things in sections to get a better idea of the costs.
Shuttleworth explained, "I talked to the Mayor yesterday a little bit about long term beach nourishment" and dredging the Carolina Beach Inlet and, "It's my wish and hope that we might go to the public with some kind of plan to educate them on cost recovery, tax, whatever you want to call it" including municipal tax districts as done in other areas of North Carolina.
Shuttleworth said, "Have an open house once or twice and bring the public in and say hey, for this kind of money this is what we are doing, but here's the impact. Here's the disruption to your life driving down 7th Street or here's the disruption to your pocketbook."
Owens explained, "My goal, once we get through this budget process, is wanting to come up with just some options for you guys to look at for municipal services districts for beach nourishment. Just some options showing you what revenue would be" depending on what route the Council decided upon.
A municipal service district could create a separate higher property tax rate for areas closure to the beachfront to help fund future beach nourishment projects.
For years the Town has been forced to lobby congress for funding in the federal budget.
The New Hanover County Board of Commissioners voted in January to obtain a permit for renourishment projects in Carolina Beach.
According to Jim Iannucci - County Engineer - a Beach Nourishment Contingency Plan was approved by the Board in June 2011.
The Town of Carolina Beach's Federal 50 year beach nourishment project is set to expire following the last nourishment cycle likely to occur in 2013. The contingency plan will allow the County to attain a permit similar to the Army Corp of Engineers permit for beach nourishment should federal funding fall short in the future.
Iannucci explained, "There were many options as part of that plan along with an interlocal agreement with the beach towns. That was an integral component that was done concurrently with the plan so we could get the beaches on board in the event that there was a lack of federal or state funding that we would have a plan in place."
He explained, "One of the options of this plan was to provide the necessary permits and authorizations to perform these projects on our own. When this plan was entered into, contributing funds authority was not an option." He said previously there was no option for local governments to contribute funds to the Army Corp of Engineers to make up funding shortfalls in the Federal Budget.
Iannucci explained, "The priority is really to get the Carolina Beach project reauthorized. Now that we have contributing funds authority, we could contribute to the other two beach projects."
Officials are working to get the Carolina Beach project reauthorized using the Washington Lobbying firm of Marlowe and Company to garner congressional support.
For Carolina Beach, the worst-case scenario outlined earlier this year is $350,000 dollars per year during those years without federal or state funding.
The Town of Carolina Beach's current 50-year project cooperation agreement with the Federal government expires in 2014. Under that agreement, the Federal government pays 65% of beach nourishment projects every few years. The state and local governments fund the remaining 35% with state funding and local room occupancy tax revenues. If the Town's program is not reauthorized, there must be a contingency plan in place prior to that to ensure such projects continue.
In the event of a lack of Federal and State funding Room Occupancy Tax revenues would pay any shortfall up to 85.2% of the total project cost. Any shortfall after 85.2% of the total project cost shall be paid by the town in which the work takes place up to a maximum of 17.5% of the total project cost. The 17.5% of the total project cost equates to the 50% of the remaining 35% of the total project cost paid by the State on previous nourishment projects that received 65% in Federal funding.
During the May 11, meeting Owens explained to the Council it would be an item for next years budget and, "It depends on what you want to do. If you just
want to raise $350,000 a year using your ad valorem property taxes then we could do that or we'd have to create service districts and move forward with that."
Owens explained, "Whether ocean front [properties] pay more or two rows in pays, that's a decision" for the Council.
He explained, "There's still a lot of uncertainly about the beach nourishment part. Whether we are going to get re-funded. Are we reauthorized or not."
Mayor Rothrock said the Council should get through planning the upcoming budget and then return in June or July to continue discussions on the issue.