At a Budget Work Session of the Board of Supervisors

Of the County of Sussex, held in the

General District Courtroom on Thursday, February 17, 2005 at 6:30 p.m.

MEMBERS PRESENT

Charlie E. Caple, Jr.William J. Collins, Jr.

C. Eric FlyWayne M. Harrell

Alice W. JonesRufus E. Tyler, Sr.

OTHERS PRESENT

Mary E. Jones, CountyAdministrator

Jacqueline M. Brown, Deputy County Administrator

Henry A. Thompson, Sr., CountyAttorney

Jerry L. Whitaker, Director of Finance

Deborah D. Jenkins, Assistant to CountyAdministrator

CALL TO ORDER

The meeting was called to order by Chairman Collins.

ADOPTION OF AGENDA

ON MOTION OF SUPERVISOR CAPLE, seconded by SUPERVISOR JONES and carried: RESOLVED that the agenda of the February 17, 2005 budget work session of the Sussex County Board of Supervisors is hereby adopted as presented.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

Fiscal Year 2006 Budget

Mr. Jerry Whitaker addressed the Board and provided an overview of the budgetary process. He also provided a schedule of activities as it relates to planning the fiscal year 2006 budget.

ADJOURNMENT

ON MOTION OF SUPERVISOR CAPLE, seconded by SUPERVISOR TYLER and carried: RESOLVED that the February 17, 2005 budget work session of the Sussex County Board of Supervisors is hereby adjourned.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

At a meeting of the Board of Supervisors of the County of Sussex,

held in the General District Courtroom on

Thursday, February 17, 2005 at 7:30 p.m.

MEMBERS PRESENT

Charlie E. Caple, Jr.William J. Collins, Jr.

C. Eric FlyWayne M. Harrell

Alice W. JonesRufus E. Tyler, Sr.

OTHERS PRESENT

Mary E. Jones, CountyAdministrator

Jacqueline M. Brown, Deputy County Administrator

Henry A. Thompson, Sr., CountyAttorney

Jerry L. Whitaker, Director of Finance

Deborah D. Jenkins, Assistant to CountyAdministrator

CALL TO ORDER

The meeting was called to order by Chairman Collins and led in prayer by Supervisor Fly.

ADOPTION OF AGENDA

ON MOTION OF SUPERVISOR HARRELL, seconded by SUPERVISOR CAPLE and carried: RESOLVED that the agenda of the February 17, 2005 meeting of the Sussex County Board of Supervisors is hereby adopted with the following amendments: Under County Attorney’s report, add Redistricting; under Citizens’ Comments, add Mr. Lester Harrell; under Closed Session, add “b” personnel matters and “c” legal matters; and under Request For Appropriations, add Application & Certificate for Payment #18 from Blueridge General.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

APPROVAL OF MINUTES

ON MOTION OF SUPERVISORJONES, seconded by SUPERVISOR HARRELLand carried: RESOLVED that the minutes of the January 20, 2005 meeting of the Sussex County Board of Supervisors are hereby approved as presented.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

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APPROVAL OF WARRANTS & VOUCHERS

ON MOTION OF SUPERVISOR CAPLE, seconded by SUPERVISOR JONES and carried: RESOLVED that account payables warrants in the amount of $290,369.81 and payroll deduction checks in the amount of $41,974.07 are hereby approved as presented.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

APPROVAL OF APPROPRIATIONS

Staff request approval of the following appropriations:

VendorDescriptionInvoice #Amount

Atlantic CommunicationsMaint./Svc. Contract3266$10,282.50

Atlantic CommunicationsMaint./Svc.3271$10,282.50

Blueridge General, Inc.Middle school project18$514,918.46

Long & AssociatesSewage Oper. Training1211$2,400.00

Rancorn WildmanMiddle school project0018441$37,779.54

Rancorn WildmanMiddle school project0018460$33,337.35

Waco, Inc.Asbestos removal47393$32,840.00

ON MOTION OF SUPERVISOR HARRELL, seconded by SUPERVISOR CAPLE and carried: RESOLVED that Invoice #3266 from Atlantic Communications in the amount $10,282.50 for the maintenance service contract is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

Invoice #3271 from Atlantic Communications in the amount $10,282.50 for the maintenance service contract is hereby deferred until the March 17th meeting.

ON MOTION OF SUPERVISOR JONES, seconded by SUPERVISOR CAPLE and carried: RESOLVED that Invoice #18 from Blueridge General, Inc., in the amount of $514,918.46 for Sussex Middle School Renovation project is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

ON MOTION OF SUPERVISOR TYLER, seconded by SUPERVISOR FLY and carried: RESOLVED that Invoice #1121 from Long & Associates in the amount of

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$2,400.00 for Sussex Central High School Sewage Complex operator training is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

ON MOTION OF SUPERVISOR HARRELL, seconded by SUPERVISOR JONES and carried: RESOLVED that Invoice #0018441 from Rancorn Wildman in the amount $37,779.54 for SussexMiddle school project is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

ON MOTION OF SUPERVISOR TYLER, seconded by SUPERVISOR FLY and carried: RESOLVED that Invoice #0018460 from Rancorn Wildman in the amount $33,337.35 for SussexMiddle school project is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

ON MOTION OF SUPERVISOR TYLER, seconded by SUPERVISOR CAPLE and carried: RESOLVED that Invoice #47393 from Waco, Inc., in the amount $32,840.00 for asbestos removal at the former StonyCreekJunior High School is hereby approved for payment.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

Health Department

Health Department staff was not able to attend the meeting, but forwarded a report dated January 3, 2005 regarding influenza immunizations. (A copy of the report is retained in the February 17, 2005 Board packet).

Highways, Streets and Roads

Mr. William Richardson, Interim Resident Engineer, Waverly Residency of the Virginia Department of Transportation addressed the Board and requested adoption of a resolution pertaining to Route 735.

ON MOTION OF SUPERVISOR TYLER, seconded by SUPERVISOR CAPLE and carried: WHEREAS Secondary Route 735, from 0.022 km S. Int. Route 642 to 2.810 km S. Int. Route 635 a distance of 2.25 miles, has been altered, and a new road has been constructed and approved by the Commonwealth Transportation Board, which new road serves the same citizens as the road so altered; and

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WHEREAS, a certain section of this road follows a new location, that being shown on the attached sketch entitled ”Changes in the Secondary System due to Relocation and Construction on Route 735, Project: 0735-091-182, M-501”, dated February 9, 2005.

NOW THEREFORE BE IT RESOLVED, that the portion of Secondary Route 735, i.e., Sections 5 and 6 shown in Red on the aforementioned sketch, a total distance of 0.10 miles, be, and hereby are added to the Secondary System of State Highways, pursuant to Section 33.1 – 229 of the Code of Virginia of 1950, as amended;

AND, further that the portion of Secondary Route 635, i.e., Section 7 shown in Brown on the aforementioned sketch, a total distance of 0.04 miles, be, and hereby is added to the Secondary System of State Highways, pursuant to Section 33.1 – 229 of the Code of Virginia of 1950, as amended;

AND, further that the portions of the old location (Route 735), i.e., Sections 1, and 3 shown in Blue of the aforementioned sketch, a total distance of 0.10 miles, be, and hereby are abandoned as a public road, pursuant to section 33.1 – 155 of the Code of Virginia of 1950, as amended;

AND, further that the portion of old location (Route 635), i.e., Section 4 shown in Blue on the aforementioned sketch, a total distance of 0.05 miles, be, and hereby is abandoned as a public road, pursuant to Section 33.1 – 155 of the Code of Virginia of 1950, as amended.

RESOLVED that the Sussex County Board of Supervisors adopts this resolution of approval in consent with the Commonwealth Transportation Board for the changes to Route 735 (Courthouse Road).

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

CountyAdministrator’s Report

Ms. Jones introduced Ms. Ann Walls, an accountant with Robinson Farmer Cox & Associates, who provided the County’s annual audit report to the Board. (A copy of the report is retained in the February 17, 2005 Board packet).

Qualified ZoneAcademy Bonds

Ms. Jones advised the Board thatQualified Zone Academy Bonds are taxable bonds issued by a state or local government and the proceeds are used to improve certain eligible public schools. The Qualified Zone Academy Bond initiative is a federal

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program that allows lending institutions and schools to form a mutually beneficial partnership to support education. Qualified Zone Academy Bonds can be used for: rehabilitating or repairing eligible public school facilities, providing equipment for use at an academy, developing course materials for education to be provided at an academy, for training teachers and other school personnel in an academy. The QZAB Program allows a bank or other lending institution to purchase a special no interest bond on behalf of a school. The lending institution may then claim the interest they would have earned on that loan as a federal tax credit.

The Office of the Secretary of Education was authorized to approve $6,462,000 of QZAB bonds for calendar year 2003 and $7,683,000 for calendar year 2004. State law as well as federal regulations mandate that all allocations be used at schools that are either located in a federal enterprise community or where 35 percent or more of the students are eligible for free lunch. Dr. Harris was notified by letter of the availability of $2,174,571 in interest free Qualified Zone Academy Bonds for the Sussex County School System. This represents the amount of $1,077,000 that was not used in calendar year 2003 and $1,097,571 for 2004. Bonds from the 2003 allocation must be issued by December 31, 2005. Bonds from the 2004 allocation must be issued by December 31, 2006. Informally the County has been told that an additional allocation of $1.1 million will be available for 2005. The three years would total the amount of approximately $3.3 million in interest free monies available to SussexCounty.

Dr. Harris, Mr. Whitaker and I have met and discussed the availability of these funds and the requirements for securing them. There will be a need to employ a bond counsel and financial advisor. These costs can be paid out of the bond issue. The project that has been identified is the Sussex Middle School Project. These funds cannot be used to pay off existing debt for a project, therefore the repayment of the SunTrust loan is not an eligible item. However, SussexCounty has expenses for the SussexMiddle School project and these funds can be used for that purpose. Dr. Harris will present this proposal to his Board prior to your meeting.

The County’s IDA can issue these bonds. There is a 10% private contribution match that is a primary requirement for the issuance of these Qualified Zone Academy Bonds. There is a private entity that is interested in being part of an issuance for SussexCounty.

Staff recommends pursuing these funds for the School System. Dr. Harris has returned the required letter of intent indicating that SussexCounty is interested. A project has been identified. The IDA can be the bond issuing authority.

Staff asks for authorization to prepare the necessary application package, procure the required bond counsel and financial advisor.

Staff also requests adoption of the enclosed reimbursement resolution by the Board of Supervisors.

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ON MOTION OF SUPERVISOR HARRELL, seconded by SUPERVISOR FLY and carried: RESOLVED that the County of Sussex, Virginia (“Sussex County”), and Sussex County Public Schools have undertaken a project making additions to and renovating of Sussex Central Middle School (the “Project”) and have been financing the costs of the Project with a combination of the proceeds of a bond anticipation note sold to SunTrust Bank (the “Note”), which Note is intended to be refunded by a loan from the Literary Fund, and appropriations from the general fund of Sussex County (the “General Fund Moneys”).

This Board of Supervisors of Sussex County (this “Board”) has been advised that (1) a portion of the costs of the Project may be eligible for financing with Qualified Zone Academy Bonds (“QZABs”) described in Section 139E of the Internal Revenue Code of 1986, as amended (the “Tax Code”), to be issued by Sussex County or a governmental conduit issuer acting for Sussex County’s benefit (such as the Industrial Development Authority of Sussex County), (ii) QZABs present a uniquely attractive financing opportunity to Sussex County and Sussex County Public Schools and (iii) although the proceeds of QZABs could be used to reimburse certain expenditures made from the General Fund Moneys prior to the issuance of QZABs (“Expenditures”).

The Board has also been advised that federal tax requires the Board to adopt a resolution in the form set forth below to (i) preserve Sussex County’s ability to use proceeds of QZABs to reimburse itself for Expenditures and (ii) facilitate the satisfaction of one of the requirements for a valid issuance of QZABs, namely the private business contribution requirement; now therefore,

BE IT RESOLVED by the Board of Supervisors of the County of Sussex, Virginia:

  1. If Sussex County and the Sussex County Public Schools can satisfy the requirements of Section 1397E of the Tax Code and issuance of QZABs is determined by this Board to be in the best interest of Sussex County, Sussex County expects to finance the portion of the Project that will not be financed by the Note through the issuance of QZABs in the maximum principal amount of $3,300,000.
  2. This Resolution represents a declaration of “official intent” for purposes of Treasury Regulations Sections1.150-2 and 1.1397E-1.
  3. SussexCounty reasonably expects to reimburse the Expenditures made prior to the issuance of QZABs with the proceeds of QZABs and the adoption of this Resolution is consistent with the budgetary and financial circumstances of SussexCounty.
  4. This Resolution is also intended to reflect the official intent of this Board that any qualified contributions received by SussexCounty or Sussex County Public Schools prior to the issuance of any of the above described

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QZABs with respect to a qualified zone academy to be established by the School Board of Sussex County to include Sussex Central Middle School (or an academic program within Sussex Central Middle School), to have a nexus to the to the QZABs and may be counted to the extent permitted by Section 1397E of the Tax Code towards satisfying the private business contribution requirement for the QZABs. “Qualified contributions,” “qualified zone academy” and private business contribution requirement” have the respective meanings set forth in Section 1397E of the Tax Code.

  1. This resolution shall be in effect from and after its adoption.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

Resolution to Establish A Deferred Compensation Plan

Ms. Jones advised the Board that during the early 1990s, the Board of Supervisors adopted a deferred compensation plan which allowed employees to enroll in the National Association of Counties Deferred Compensation Program. There is currently interest by many of the employees to enroll in the American International Group Variable Annuity Life Insurance Company (AIG VALIC) program. To allow this participation, staff recommends adoption a resolution.

ON MOTION OF SUPERVISOR TYLER, seconded by SUPERVISOR FLY and carried: RESOLVED that the Sussex County Board of Supervisors has considered the establishment of a Deferred Compensation Plan to be made available to all eligible Sussex County employees pursuant to Section 457B of the Internal Revenue Code permitting such plans; and

WHEREAScertain tax benefits could accrue to employees participating in said Deferred Compensation Plans and such benefits will act as incentives to county employees to voluntarily set aside and invest portions of their current income to meet their future financial requirements and supplement their Virginia Retirement System and Social Security benefits; and

WHEREAS, the American International Group Variable Annuity Life Insurance Company (AIG VALIC) has established a Deferred Compensation Program, permitting public employees to enjoy the advantages of this program; and

WHEREAS, by adoption of the AIG VALIC Program, all regulatory, operational, administrative and fiduciary responsibilities are hereby assumed by AIG VALIC on behalf of Sussex County; and

WHEREAS, AIG VALIC, as Plan Administrator, agrees to hold harmless and indemnify SussexCounty its appointed elected officials and participating

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employees from any loss resulting from AIG VALIC or its agent’s failure to perform it duties and services pursuant to the AIG VALIC Program;

NOW THEREFORE BE IT RESOLVED: The Sussex County Board of Supervisors hereby adopts a 457(b) Deferred Compensation Program as administered by AIG VALIC and hereby establishes Sussex County Deferred Compensation Program for the voluntary participation of all eligible County employees.

BE IT FURTHER RESOLVED: The Sussex County Administrator is hereby authorized to execute for the Sussex County Deferred Compensation Plan, individual participation agreements with each said employee requesting same, and to act as the “administrator” of the plan representing the County and to execute such agreements and contracts as are necessary to implement the program. It is implicitly understood that, other than the incidental expenses of collecting and disbursing of the employees’ deferral and other minor administrative matters, there is no cost to SussexCounty for the Program.

Voting aye: Supervisors Caple, Collins, Fly, Harrell, Jones, Tyler

Voting nay: none

VirginiaMotorsportsPark – Application for Virginia Tobacco Grand Funds

Ms. Jones advised the Board that included in the late agenda packet is a letter from William C. Scheid, Dinwiddie Director of Planning and a resolution as adopted by the Dinwiddie County Board of Supervisors regarding an application for Virginia Tobacco grant funds for the VirginiaMotorsportsPark. DinwiddieCounty is requesting the support of SussexCounty in securing the funding needed for the required improvements. Since Sussex is enrolled as a participating member of the Virginia Tobacco Indemnification Program, DinwiddieCounty believes that Sussex’s support is important when their proposal is reviewed by the Tobacco Commission.