NEWBERRY COUNTY COUNCIL

WORK SESSION

MINUTES

NOVEMBER 1, 2006

Newberry County Council met on Wednesday, November 1, 2006, at 1:00 p.m. in Council Chambers at the Courthouse Annex, 1309 College Street, Newberry, SC, for a work session.

Present were: Mike Hawkins, Chairman

William D. Waldrop, Vice-Chairman

John E. Caldwell, Councilman

Henry B. Summer, Councilman

John David Dawkins, Councilman

Andy Morris, Councilman

Edgar Baker, Councilman

Wayne Adams, County Administrator

Gary T. Pope, County Attorney

Susan C. Fellers, Clerk to Council

Media: Cindy Pitts, Newberry Observer

Heather Hawkins, WKDK

Notice of the meeting was duly advertised as required by law.

Mr. Hawkins called the meeting to order and determined a quorum to be present.

Mr. Hawkins received a request from the Fairgrounds Commission to spend $4,200 for the dairy, beef and goat show out of the $12,000 allocation previously approved by Council. The consensus of Council was to allow them to do that.

Discussion of Capital Projects and budgets:

Mr. Adams advised there are ten separate capital projects budgets under consideration. All of them except one, the Sheriff’s Office, have to do with the local option sales tax funding. The projects are as follows: Silverstreet Fire Station, Prosperity Fire Station, Consolidated Fire Station, Helena Community Center, the Library, Rescue Squad 14, Maybinton Baseball Field, and a Public Works Building (including an Animal Shelter). Those budgets at this point show a projected shortfall in revenue of $3,563,731 and would also require a debt service reserve of about $356,000 making the total principal borrowing necessary to fund them all as budgeted $3.9 million. On a 15 year amortization that would be approximately 4 mills, and on a 20 year amortization it would be approximately 3.3 mills.

The Sheriff’s Office budget is $4,393,465, which requires a debt reserve making the total borrowing necessary $4,832,812.

The proposed Sheriff’s Office would include 12,500 useable square feet with a 15,000 square foot footprint. When Carter Goble Lee did the facilities study a couple of years ago, there was about 10,400 useable square feet in the building on Highway 219.

Mr. Summer stated 4.9 mills for 15 years would be equivalent to a $20 tax increase on a $100,000 owner occupied house at 4%.

The EMS amendment includes $11,880 for the Council on Aging to help with reassessment for 2009. This amendment would amount to a $13.68 on a $100,000 owner occupied home.

The issue is whether or not to fund expanding the EMS service from two full time ambulances in the evening hours to 4 crews.

The total mills for the entire sales tax projects would be approximately 12.5 mills. Nine of those mills are for the capital items, which would be about $36 without the EMS. Another $13.68 would be added for the EMS amendment, which would be approximately $50 on an owner occupied house.

The scrubbers and dehumidifiers at the old Sheriff’s building have been deleted, and that amendment has dropped down to .12 mills, which is principally to fund the Sheriff’s rental of modular units for the rest of the year.

Last year’s levy was 114.3 mills, and the June version as passed is 125.8 mills. When the budget was balanced in June, $46 was added to balance the budget and $50 will be added if everything being considered today is approved.

Mr. Waldrop said the cost overruns were because of the Building Codes approved by County Council. Mr. Pope’s opinion was that the State does not give the County the option of either adopting or not adopting the Code. The State Building Codes Council approved the changes, and we have to accept it. We don’t have the right to amend it. The buildings must be strong enough to withstand earthquakes and other disasters.

Mr. Dawkins advised from 8:00 p.m. to 8:00 a.m. Newberry County only has two staffed ambulances available in the county, which does not include the Rescue Squads. For the square miles and population of the county, adequate care is not being provided for the citizens of the county. During that time period there are approximately three hours per day that no EMS ambulance is available. Mr. Dawkins requested that Council consider approval to add two additional ambulances. The two ambulances from 8:00 p.m. to 8:00 a.m. are the same amount the county had 20 years ago, and the call volume has increased approximately five times what it was 20 years ago.

Lynn Beasley, Newberry County Memorial Hospital, stated that in 1995 they were running approximately 2,200 calls, and they will exceed 5,000 calls this year running still the two crews during the nighttime hours. During the day time hours, four ambulances and two quick response vehicles and a non-emergency transport service are available. The non-emergency transport can provide emergency back up during the daytime. The main issue is being able to respond to the community’s needs during a medical emergency within a reasonable window of time. The national standard of care is response within about seven to eight minutes. Given the geographic coverage that has to be provided at night, we are over three times that national standard. Response time is of utmost importance. Mr. Beasley asked Council to think about setting EMS aside for the life saving service it provides. The coverage we have today results in response times upward to 25 and 30 minutes. We believe the plan to increase two satellites, one on the east side and one on the northwest side of the county, will best achieve the ultimate goal of being able to respond with well-trained and well-equipped paramedics to meet the medical needs of the community during emergencies. It will cost approximately $160,000 per crew for that 12 hour period, for a total cost of about $320,000. We believe it is money well spent, and we pledge to you that those funds will be used in a publicly responsible manner to meet the needs of the people and respond to the best of our abilities.

Mr. Caldwell asked which stations. Mr. Beasley responded the Whitmire area and the other at Seibert and Macedonia Church Roads. The unit at Seibert and Macedonia Church Roads will cover as far south as Stoney Hill and as far north as Peak.

Mr. Hawkins asked why the Rescue Squad ambulances could not perform this same service. Mr. Beasley stated it was because of availability of personnel. The Rescue Squads provide a tremendously important and well-respected service. Some are EMTs and a few are paramedics. We have paramedics on every truck every time it rolls. We roll within one to two minutes in every case unless we are at full capacity and already responding to emergencies in the field. When you have volunteers who work, it is sometimes hard to get a qualified person off their job to the rescue center in the truck and rolling. Oftentimes it is hard to get someone with the special training needed to drive an ambulance. We find that in looking at the data and the Sheriff’s data through the 911 system, about 13% of the time the Rescue Squad is in a position geographically and available with people to respond to emergencies. The other 87% we are responding because our crews are there and immediately available. The Rescue Squads have the same supplies and equipment on their ambulances as EMS. In the case of paramedics versus EMTs there are certain things that are restricted to paramedics only in terms of life saving medicines. Formal training for an EMT is 64 to 80 hours whereas the paramedic is about 260 hours. The other thing is getting the volunteer who has the time to take for the training. There are shortages of trained personnel in the State, and we have to make sure that we maintain competitive salaries. On some occasions some of the volunteers in the Rescue Squads work for us part time or on an as needed basis as paid staff. The availability of qualified manpower is the issue.

Mr. Waldrop asked about a tax district for the people who want this service rather than everybody in the county having to pay for the services.

Mr. Beasley stated sometimes they run into the situation where people don’t want to pay for the ambulance and would rather have the free service through the Rescue Squad. If an emergency vehicle and trained crew is not available and it is their loved one, they want it and they want it now. During the day we have a quick response vehicle stationed in Silverstreet, and they have the quickest response time. We try to position the ambulances where we have the largest call volume, and we have the most dense population given the land mass. We believe we have positioned the vehicles to best serve the population quickly, and based on research what saves lives in emergency medicine is to be able to get qualified people to the scene to stabilize a patient quickly.

Mr. Morris offered as a compromise if another shift is funded for Newberry at night, would that alleviate some of the problems with the exception of the response time. Mr. Beasley stated it should reduce the three hour period when we are at 100% capacity by increasing the capacity by 50%. Yes, it would increase the capacity to respond to emergencies. He did not believe it would improve response time because they would be rolling the ambulance from the centralized location to areas at the edge of the county. Whether we have two or three ambulances, it will still take us the same amount of time to get to Stoney Hill or to Whitmire from Newberry. Right now with the satellites in place during the day our average response time in Whitmire is 2 ½ minutes and down at Seibert Road it is about 7 ½ minutes taking into consideration that the geographic coverage there is a good bit larger.

Mr. Morris said a memo was written to our Emergency Services Coordinator November 23, 2005 with a list of 25 items he was to address and report back to Council. The original report was due back at the Planning Retreat in February 2006. Almost twelve months later, we haven’t received anything. If the study had been done and the information presented to Council, we could have made some sound planning decisions rather than having nothing to base our decision on.

Mr. Caldwell stated that according to the map Station 14 has the most territory in the county and asked how many emergency vehicles that station had. Mr. Beasley understood they had one and one rescue vehicle. They are located within half a dozen blocks of the EMS.

Mr. Caldwell asked how the ambulances were disbursed to the other six and if it was based on population or mileage. Mr. Beasley said he couldn’t address how the individual rescue squads respond. From the total call volume, the busiest location is in and around the Town of Newberry out to a radius of 7 to 10 miles. The next busiest site is the southeastern area down at Seibert Road, which also covers as far into town as Prosperity, Stoney Hill area, Little Mountain and Peak. The third busiest location is Whitmire, and the fourth busiest is Silverstreet.

Mr. Beasley stated when their Strategic Planning Committee met with the Emergency Services Board, they presented detailed data in numbers and percentages and calls by area. We have a lot of data as it relates to the call volume and response times. We considered a request should we move one of the 24 hour ambulances down toward the Stoney Hill area and Seibert Road, and the data did not support that because about 73% of the calls were best served without additional resources from the Newberry central location. The areas not best served were the two satellite stations previously mentioned.

Mr. Summer stated Council recently increased the service for paid ambulances with the 12 hour shifts at Fairview and Whitmire. Mr. Beasley advised approximately 2 years ago we expanded to have those sites because of the response time. We put them in that time frame because of the time that calls came in and given the resources, that was the best coverage we could provide but at the same time we recognized there were still gaping holes to meet the needs in the evening and nighttime.

Mr. Beasley stated from 1995 to date, there has been a growth in call volume of more than 1,800 calls a year. If because of this State cap, this delays the ability to expand the service further for another four or five years, we can expect another 1,000 call volume on top of what we have now, and the situation we are faced with today will be much worse. There is a shortened window of opportunity for us to be able to respond to the needs.

Mr. Adams stated his role was to tell Council about options to make sure citizens get the most bang for the buck. One of the issues raised was a special tax district in which you might have more intensive coverage. A special tax district works well for fixed amenities like street lights and roads. The problem in a service like EMS is that ambulances aren’t static. They are moving around to meet the needs of the county as a whole. Also, it would be untenable to have a moral dilemma where an ambulance stationed in one district may be two miles from a house where some emergency is occurring not to respond. In reality that is not going to happen. The kind of folks who work for these services is not going to let that happen. There may be other options such as fees, but Mr. Adams could not recommend the special tax district because he didn’t think it was workable.

We talked about staffing an ambulance in Fairview and Whitmire. The same thing goes for that scenario. The ambulance is not a static resource. If you lived in Newberry and a Newberry ambulance is on a call, it might be that Whitmire ambulance that saves your life. The territorial concerns really don’t work out for an ambulance service.

Mr. Beasley agreed and said if they get a call in Silverstreet or toward Chappells, they would move the ambulance at Fairview toward Prosperity so they would be in a better position to respond given the circumstances of a call that has pulled part of our resources to one extreme area of the county. They do move back and forth through effective radio communications.

Mr. Adams said another thing was the over promising or over expecting of Rescue Squad resources. They are a tremendously valuable resource. No one in this room or outside this room would doubt that, but as has been pointed out for reasons of time and training, they are a limited resource. There has to be a certainty when we talk about a service such as ambulance response.

Mr. Beasley stated they supplement the paid service exceptionally well but it is a supplement.

Mr. Dawkins asked Mr. Adams for a recommendation. Mr. Adams’ recommendation was that the county would get the service level it paid for with this kind of service. The diminishing response times are very real times, and they are marked between the daytime and nighttime. If it is the community’s desire that the response be quicker, if it is the community’s desire that we plan for the future in the face of these millage caps, which are going to restrict our ability to expand services in the future, then, yes, it is certainly the thing to do.

In response to an earlier inquiry as to the International Building Code, Mr. Pope advised that Section 6-9-10, effective July 2, 2003, makes it mandatory that all municipalities and counties shall enforce building, energy, electrical, plumbing, mechanical, gas, and fire codes. This is not something that is voluntary or that we can withdraw from. It has to be done, and it has to be done in accordance with the Code as adopted.

The second question was whether or not a pole building was suitable for a fire type facility. Our consultants have done extensive research about this, and it is not that you can’t have a pole building, but the pole building has to meet the same requirements for earthquake resistance and be fire proof. By the time you make a pole building meet those requirements, you could have built a proper building to begin with.

Peggy Schumpert, President of the Steering Committee for the Friends of the Library, stated the first public library was founded in 1904 by the Woman’s Club of Newberry and through the generosity of the Honorable George S. Mower, who furnished us a room on the second floor of his downtown store. The library stayed in that location until 1934 when it was then moved to the ground floor of the old courthouse on Boyce Street. At that time it was operated by the WPA. In 1938 the WPA funds were reduced, and the library was taken over by the Council of Farm Women. In 1968 we were fortunate enough to get the old Post Office, and according to the newspaper articles at that time after the renovation, it was a fine facility, and even had a little room for future expansion. This is the first time in the history of our county that we have had the opportunity to build a new facility thanks to the citizens of the county for their support of the one cents sales tax and to County Council who has already spent countless hours on this. In this new facility we can have an expanded children’s section, a young adult section, a designated historical and genealogical section, and an expanded computer section. Ms. Schumpert requested that Council consider continued support of the square footage approved back in April of 2006.

Mr. Summer stated the State Library Board recommended a square footage in excess of what we have now for our needs. Ms. Schumpert said they recommended 23,000 square feet, and Council has approved 21,300 square feet.

Mr. Hawkins asked if that was recommended based on the population of the county. Ms. Schumpert said they did, and the library in Whitmire was taken into consideration.

Verna Cavanaugh offered the following suggestion: There is land on Smith Road across from Newberry Academy that the Cavanaughs will give to the County for the library.

Jack Grimes, Carter Goble Lee, told Council the committee met and selected six qualified contractors to proceed with the bidding. Because of the time constraints, the committee is moving ahead until told not to with planning for the construction of the library. Based on the outcome of this meeting now, we will move ahead and provide bid packages to the qualified contractors.

Mr. Hawkins said Ms. Cavanaugh didn’t suggest any savings, but that the same amount of money be spent but you could complete the building and the infrastructure costs could go into the building.

Donza Mattison, McMillan Smith Architects, said if you move to another site, you would have to spend money on another topo survey and a complete redesign of the facility for that site. You still have to do the sewer, water, parking, and draining, and that is assuming infrastructure is there. You would also have delay costs. Right now we are ready to go out for bid on this project. If we start with a new site, there would be escalation of costs.

Mr. Baker dealt with the DSS building for a long time. The site across the street from it is identical and is what is called crawfish land. It has no bottom. Just this past year the entire parking lot had to be dug up and extra drain pipes put in. He felt this would not be a suitable site.

Mr. Summer asked what additional costs would be incurred if the size of the building is reduced. Ms. Mattison stated their A&E fee would have to start over again, which would be an extra $150,000 or so. In order to get back to where we are today, ready to advertise, we have potential price escalation in materials.

Mr. Caldwell asked if it would not be a cost saving factor to stay with the present size and in the future expand rather than changing the entire building. Ms. Mattison said it depended, but from her prospective we should continue down the path we are on, get the bids and see what the numbers are. You could choose other options to start cutting. Either of those options would create more fees and time for Ms. Mattison and delays getting the project out on the street. They are willing to do whatever Council decides, but they are ready to go ahead and advertise the Library.

Mr. Morris asked what the Library was doing to raise funds or apply for grants to assist with the project. Tuckey Taylor stated they have a Gates grant in approximately
$15,000 to $20,000.

Mr. Morris asked about the State Library grant. Ms. Taylor advised they had requested $1,000,000 from the Legislature for next year, and we are in the first group.

Mr. Adams said the budget presented today does not include approximately $460,000 for furniture and fixtures as discussed at a recent meeting with the Library Board. The Library Board is pledging to generate funds from donations or other sources for that.

Mr. Hawkins said moving the location would probably not save any dollars but felt it would be prudent if the committee would look at the site. If you could save enough money by moving out there to pay for the furniture and fixtures, it needs to be looked at before going ahead with the infrastructure expenses downtown. For purposes today the amount of money is not going to change a lot.

Mr. Morris asked if discussions had been held with Representatives McLeod and Duncan and Senator Cromer to get them on board relating to the funds requested from the Legislature for next year. Ms. Taylor advised they were working on that.

Ms. Mattison addressed the suggestion of looking at the new site. The most recent cost estimate dated October 9 lists the site work costs as $399,000. What is not included is the amount for BellSouth to add one line. If you add that you are talking about $450,000. By moving this building to another location, you are still going to have to pay for parking lots, curbing, sewer, etc. There is no way you are going to deduct $450,000 by moving it to make up the difference to purchase the furniture and fixtures. This is assuming the other land is virgin land and has no parking or infrastructure. You have to incur those costs regardless of whether it is downtown or elsewhere. That money will have to be paid.

Mr. Morris felt we should go with it as is because of all the effort and resources already in it.

Mr. Pope advised the petition had been filed to close the street, and the Highway Department has not interposed an objection. If the City has done the necessary advertising, the Judge will be ready to sign the Order closing the street next week.

Mr. Adams stated the Rescue Squad 14 building shows a shortfall of $144,560; location yet to be confirmed.

Bids for Consolidated, Prosperity and Silverstreet have been received and are good for 90 days.

The difference between the Rescue Squad 14 project and the fire department projects is if this budget is adopted, it will have to be designed and may mean compromising. If the budget is passed, this is the number we budget to. There is a contingency of 7 ½% but that is not overly generous, but it could mean in the design of the building that some things are not doable financially.

Mr. Grimes advised the building designed to the budget would be quite a bit different from what the Rescue Squad now wants. The Rescue Squad is looking for a larger training room, day room, bunk rooms, several office spaces along with 3 bays. Now we are looking more like what Consolidated will be getting – a couple of offices, a large training room and the kitchen and storage area along with 3 bays.

We assume the land acquisition will be at no cost, and Mr. Pope is working on something in that regard. There has been consideration and subsequent rejection of location on the Fairgrounds but we are assuming in this budget that it will be built on County property.

Mr. Pope had a conversation with Mr. Cavanaugh last week, and he wanted to see a copy of the plat, which has now been delivered. Proposedly it would be an even swap. The County has 5 acres with a gulley in it and power lines across it. The trade would be to get a 2 acre lot at the corner of Adelaide Street and the Bypass, which is the preferred site, and try to get some of the right of way that keeps the Fairgrounds from having access to Highway 34.

Mr. Morris asked if we had come up with a tentative site for the Sheriff’s Office.

[Mr. Baker and Mr. Pope left during discussion of the Sheriff’s building]

Sheriff Foster stated the following sites have been discussed: Fairgrounds; Highway 34 and I-26 (old County Home); Wilson Road (current site where trailer park is located), and the Helena site (Helena landfill). They have not been ranked but those sites would not need a land purchase, which is an optimum concern. Detailed study would need to be done as to availability of infrastructure on each site and how much the County would have to pay for the infrastructure. The Helena site is in the county and is not serviced by water and sewer. The Wilson Road site has the acreage but we don’t own the site and don’t know if we can get that site. Highway 34 and I-26 doesn’t have some of the infrastructure needed.

Discussions were also held about the National Guard Armory on General Henderson Road. Mr. Hawkins advised the headquarters would be moved from there and the plans are to put a smaller unit there. If they are not going to use it, we could use that building and would like to have it. Water and Sewer would be an issue. A fiber optic line would have to be installed from the City of Newberry to the location, which is not an impossible task. There would be certain costs associated with it. The acreage and the fenced in area for impound lots is positive. Sheriff Foster’s concern was that it doesn’t belong to the County.

Mr. Adams advised the Helena site was being considered for the Public Works and Animal Shelter facilities and possibly eventually for relocating the Transfer Station and putting in a convenience center. We met with the Alliance group (the same company doing the master planning for the Industrial Park) regarding site plans for the 121 property thinking in terms of a Public Works complex.

Mr. Hawkins asked why the Sheriff’s Office building needed to go from 10,400 square feet of usable space to 12,500 square feet of usable space. Chloe Jaco advised there were noted space deficiencies in the 10,400 square feet. The 12,500 square feet is partly a correction for spaces that may have been cut from the original plan with a little bit of marginal growth. When the Master Plan was done, the ideal situation was more like 16,000 square feet of usable space.

Offices are not being added. The 12,500 is correcting deficiencies from five years ago when adjustments were made in order to meet that budget.

[BREAK 3:16 P.M. – 3:35 P.M.]

[Mr. Baker and Mr. Pope returned to the meeting at 3:35 P.M.]

Mr. Adams advised regarding the Maybinton Baseball Field nothing had been added above the $80,000 collected in the Capital Project Sales Tax. The project would have to be budgeted to that amount unless Council increases it.

Mr. Grimes advised they wanted to add a restroom and concession stand but there is not enough money for that right now. We have $64,000 remaining. It will cost approximately $30,000 to $35,000 just to do the rough clearing and grading. Mr. Grimes talked with Carter Trucking, who are the only ones that have gone the next step to actually turn it into a baseball field. He is still crunching numbers but a lot of dirt will have to be hauled in. Tommy Whitehead will haul in dirt from the Pomaria walking track. There are two main ravines going down through the middle of the property that will have to be filled in with dirt to level the playing field. Mr. Carter can’t decide how much dirt to bring in until it is cleared and can do a topographical survey. Mr. Adams said the back stop and fencing would probably be about $7,000 or $8,000.

The field will have to be cleared first and then the facilities put in. $80,000 is all there is to work with for everything.

Mr. Morris said if you put in restrooms or a concession stand, you then have to put in a well. That area of the county does not have any convenience centers to take their garbage to. It would be an ideal situation if we could come up with a couple of acres of land next to the ballfield to put a convenience center and let them share the well and septic tank. In all the other projects we have built in a significant amount of money for contingency, and as these projects are finished if there is contingency money left over and this project is still under funded, maybe some of these funds could be offset to this project to do what needs to be done.

Mr. Adams stated in regard to funds left over some of these entities might have a tendency to look at the budgets and say this is our money. Mr. Adams recommended that Council do each project as economically as possible and that the remainder Council decides what to do with.

Mr. Grimes has talked with people there and the chances of getting some adjoining property are zero. Right now if you get the ballfield out there, not only will you not have restrooms, but also there will be no parking. The $15,000 already spent is mostly on property acquisition. The only thing spent so far was $1,230 to the surveyor to mark the lines.

Mr. Summer asked if Mr. Grimes had a guesstimation as to how much we should put in this. Mr. Grimes did not know how much it would cost to finish the field out. All of the bids have been relatively close for the rough clearing. The fill cost will be the biggest expense.

Mr. Adams advised it could easily cost twice as much by the time we put in the facilities and finish the ballfield.

In regard to the Public Works Building and Animal Shelter, Mr. Adams and Jack Grimes looked at an existing building for sale on Highway 76. It is a pole building with 5,000 square feet but we feel we can replicate a structure of that kind with 3,000 square feet of office space on land that the County already owns and can probably site the facility for around $909,000. Budgeted is $887,020. We have a large contingency of 25% of construction costs because we don’t have a topo yet of the Highway 121 property. We have allowed $100,000 for site preparation; another $100,000 for paving. We feel that without having drawings and more detailed information that this lays down a marker big enough to provide them with a good facility.

As part of that same complex, we would have the Animal Shelter offices in that same building, and set aside $600,000 for the construction of the kennels and the infrastructure that has to go along with that.

Mr. Adams felt that the budgets in total and individually are probably sufficient except for the questions raised about Maybinton. It will depend on what kind of facilities Council ultimately wants there.

The Helena Community Center will be a 3,800 to 4,000 square foot building. Mr. Waldrop was surprised at some of the extra costs for this building. Mr. Grimes stated that Joe Prothro designed the budget on this. The Sheriff’s auxiliary office there may or may not make the cut on it as we make choices. The building has not been designed yet to fit the budget. There will have to be some cuts on the building from the initial conception of the building.

Mr. Adams then reviewed the amortization schedule based on 15 and 20 year finance options. The last item is a budget for interest income derived from the bond proceeds with funds borrowed up front to do all the projects at once.

Mr. Grimes advised in regards to the Rescue Squad building it would be 4 bays, 45 feet deep.

Mr. Adams advised the budget for the Rescue Squad building includes Haz-Mat funding of $120,000. His understanding was that Council wanted the $120,000 dedicated to Haz-Mat whether it would be located with Rescue Squad 14 or whether located with the City Fire Department. Mr. Dawkins advised that Council has already voted unanimously not to put Haz-Mat with Rescue Squad 14 and that $120,000 of that budget would go toward wherever Haz-Mat is housed. Mr. Adams didn’t feel the County could get what it expects with the Haz-Mat structure for $120,000, but that is the amount that Council allocated.

Mr. Baker asked how much trouble it would be to extend the one cent sales tax until we get what we need. Mr. Pope advised that seven years is the maximum. There is some interest money that will be available to complete some of the projects, but it is hard to forecast what that will be. The other thing is out of that money, you also have to build the MRI for the hospital before you start spending the interest money on the cost overruns. There are some complicated legal issues but the maximum amount of time for the capital projects tax is seven years. If there are projects, which have not been completed, the tax stays on. The promise we have made to the Internal Revenue Service is that in good faith we would spend all of this money in three years; that is, all of the bond proceeds would be spent in three years unless something extraordinary comes up. Basically the tax stays on until you collect the money or the longer of that or seven years. Seven years is the absolute maximum. There will probably be some money left at the end, but it is hard to project what it will be at this point. We have to have $751,000 for the hospital’s MRI project, and that comes out of the tail end of the proceeds. The citizens voted on the amount of money for the projects as stated, and if there is extra money legally available, that can be used and has to be used to finish the projects. Once the projects are finished, if there is any extra money it is divided up among the participants pro rata. It is hard to count on that at this point.

Mr. Waldrop asked how much money we have collected already on the penny. Judy Floyd, Treasurer, advised Council had received that information in their packet. Mr. Morris advised it was about $750,000 per quarter.

Mr. Baker stated we go into the projects the people voted on and do away with them from the bottom of the list up to finish the ones on top. They were prioritized in the vote and Council is taking them off from the bottom.

Mr. Summer stated Theo DuBose wrote a letter saying the projects were not prioritized but were simultaneous. Mr. Pope advised they were supposed to be and there seemed to be a judgment call about what we should do if there is a shortfall. The actual vote was that Council would wait and see how the proceeds came in. In other words the first projects would be completed first, and then see how the proceeds came in before you funded the final project, which was the Public Works administrative offices.

Mr. Summer said to finish these projects and borrow money at 5% is a good interest rate. If we wait and try to finish the projects later, it will cost us a lot more than that in construction costs. There were two ways to do the bond. You could do the pay as you go method where you collect the money, do project 1 and then project 2, etc. We elected not to do that because you could possibly run into a snag with one project. The bond attorney said we should do them simultaneously, meaning every one is done at the same time. If we don’t support shortfalls on every project, it is going to be which hog got to the trough first gets the food, and the ones that get to the trough last, don’t, and that is not fair.

Mr. Baker said if we are destroying what the people voted for, he didn’t see why we couldn’t change some of the top line and extend the amount of time we are taking the money in. Mr. Pope advised that Theo DuBose would be at the Council meeting tonight and could explain this. Some of this is very complicated, but basically the bottom line is you can’t change the amounts approved by the voters but if projects are not completed, and you are still collecting money, then you can use the overage to complete a project. Mr. DuBose’s previous opinion had to do with IRS regulations, and the obligation we have is that until we have collected $4,956,460 in sales tax revenues and put this into the appropriate funds, at that time you could start spending the accumulated interest.

Mr. Summer stated these are tough issues and we have a lot of overruns scattered all throughout the county. Everybody has his own projects he is more interested in than others. They are all the same issues. Some projects have been finished, and they were over budget and were taken care of because we sacrificed the Public Works building. To be fair, we need to support all of these.

[BREAK 4:26 P.M. – 4:50 P.M.]

Note: When Council reconvened, Mr. Adams, Mr. Pope and Mr. Baker were not in attendance.

Frank Smith, attorney representing the County in the lawsuit involving W.E. Baker and Son, updated Council on the status of the lawsuit.

We filed an action against W. Edgar Baker and W.E. Baker and Son, Inc. on August 31, 2006 seeking to recover damages relating to the defective construction of the Sheriff’s Office building on highway 219. This is a building that Newberry County purchased from Mr. Baker in September 2003. Due to significant water infiltration, mold developed in the building. Beginning in 2005 Sheriff department employees and some visitors began complaining of allergies and other respiratory type illnesses. Newberry County filed the action in order to recover the costs for repairs, loss of use, moving expenses and other consequential damages.

W.E. Baker and Son, Inc., which is the incorporation, the construction company, filed an Answer to our Complaint on October 25, 2006. In that Answer they also filed a third party Complaint, which is in essence a Complaint similar to ours. It is just filed against other parties, and they filed it against the various subcontractors who performed work on the building. The subcontractors they brought in were: (1) Hazel Heating and Air Conditioning, who was the air conditioning and heating subcontractor; (2) JBW, Inc., who designed the heating and air conditioning system; (3) Floyd’s Erectors, who erected the building and installed the roof; (4) Wilson Masonry, who installed the block walls on the exteriors; (5) Architects Plus, Inc., who was the architect who did the plans and specifications; (6) Stoddard Plastering, who was the subcontractor who did the small areas where you have the synthetic stucco. Those were all the subcontractors brought in to the lawsuit by the contractor, W.E. Baker and Son.

Mr. Baker, individually, is also a defendant, and he has obtained an extension of time to answer. His Answer is due Friday, November 3. Council has been negotiating with Mr. Baker and W.E. Baker and Son regarding correction of the existing building defects. Both sides have retained construction experts, and those experts have been, and are continuing to conduct tests to determine the cause of the problems and the scope of repairs necessary to correct the defects. Even though the lawsuit has been filed County Council is continuing discussions and negotiations with the defendants in an effort to reach a resolution. If negotiations are unsuccessful, the issues will be resolved either through trial or arbitration. We expect when Mr. Baker files his action, he will probably ask for arbitration based on the arbitration agreement in the memo agreement we had when we purchased the building. Those are issues we will have to address once he raises those.

Mr. Morris moved to go into Executive Session with Mr. Smith to discuss this matter further; second by Mr. Summer. Vote was unanimous. [Councilman Baker absent]

[EXECUTIVE SESSION 5:00 P.M. – 5:25 P.M.]

Mr. Morris moved to return to open session; second by Mr. Caldwell. Vote was unanimous. [Councilman Baker absent]

Mr. Hawkins advised there was nothing to report.

Mr. Waldrop moved to adjourn; second by Mr. Caldwell. Vote was unanimous. [Councilman Baker absent.]

There being no further business, the work session adjourned at 5:29 p.m.

NEWBERRY COUNTY COUNCIL

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Mike Hawkins, Chairman

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Susan C. Fellers, Clerk to Council