Paying our bills, and extras

You can craft a budget by starting with the money you expect to have in the coming year and determining how to spend it. Or you can envision the lifestyle you want and figure out how to afford it.

Chapel Hill’s budget for Fiscal Year 2018, which starts July 1 of this year, does a little of both.

One way or another, all of the money we have to spend comes from taxpayers, through property taxes and sales taxes; fees, such as for stormwater management and solid waste; a parking rate increase; and bonds that voters have approved. Visitors pay a hotel occupancy tax to the county, which divvies it up with the town.

Although the town’s recommended tax rate has gone down this year, most of us will pay a higher tax bill because the county increased the value of our residences. Commercial property values have risen even more steeply and are passed along to businesses renting space in commercial venues, so the pressure is on for local business owners to increase their sales.

This year, town employee health insurance costs increased by 12%. The town’s Employee Wellness Program keeps the premiums from going even higher. The budget puts money aside to pay for health-care coverage and pensions we promised to retired town employees, the much-discussed OPEB (Other Post-Employment Benefits) liability.

At council’s request, the town manager has included a 2% increase in the amount of funding for human services agencies. The nonprofits the town contributes to provide services that not only improve the quality of life for our most economically fragile residents but also divert residents from unaffordable situations — for instance, offering in-home support services so seniors can age in their own homes, rather than pay for an expensive assisted living facility.

The manager also shifted funds to boost the affordable housing pot to more than $1 million.

The budget includes money to replace worn-out buses with more fuel-efficient models and to rent an electric bus as a mini pilot program. The manager has designated funds to pay for a rewrite of the Land Use Management Ordinance to address the high-density development we face today.

A problematic cost comes in the manager’s recommendation of a 2.5% pay raise across the board, which increases the wealth gap by greatly benefiting those at the top end of the pay scale and minimally benefiting those at the lower end. More than 50 job categories pay between $100,000 and $200,000. I have advocated that those employees receive a $1,000 bonus instead of a percentage increase.

Council members who support an across-the-board percentage increase say that higher-paid workers will feel disrespected if they get a lower proportional pay hike and may leave. From my observation of private-sector businesses, money won’t keep a restless employee in his job. He’ll take the pay increase and keep looking for a more interesting, challenging position.

Perhaps that’s a good thing. Don’t we want to make room for employees who are excited about the work they do, rather than feel shackled by golden handcuffs?

We have many projects to invest in that would benefit town residents and visitors of all income levels. We don’t need to divert funds to feed systemic inequality.
— Nancy Oates

Building community

When the Habitat for Humanity staffer asked, “Who’s not afraid of heights?” I raised my hand. I should have thought it through.

But at 8:30 Saturday morning, with the temperatures still in the 70s and standing in the shade of a large, leafy tree, I didn’t pay attention to the fact that the unroofed part of the house was on the unshaded side.

A message had gone out on our neighborhood listserv offering an opportunity to volunteer on a Habitat build, and the only thing that gave me pause was the early start time. I signed up anyway and did my best. In hindsight, I could have saved a little time by not putting on mascara. Given that it was a bright and beautiful day, I never took off my sunglasses. And even if I had, I would have sweated off any makeup after about 20 minutes on the roof.

After going over work site safety rules and checking our shoes for traction, the Habitat supervisor sent us up on the scaffolding and helped us hoist 4-foot by 8-foot sheets of OSB — that’s oriented strand board, sheathed in a mylar-like substance to reflect heat, and quite heavy, from my perspective. Once we laid it in place, all we had to do was hammer it to the rafters.

I should point out that for the past 20 years, I’ve done no physical labor more strenuous than mowing the lawn. Gone are the days when I toted 50 pounds’ worth of toddlers and gear up and down the subway stairs in Manhattan. And it turns out that decades of typing does very little to preserve upper body strength. Still, the construction supervisor issued me a nail apron and a hammer. I was relieved nobody kept track of my speed or the number of nails I bent.

The temperature heated up as the morning wore on, and Habitat staff encouraged us to take frequent water breaks in the shade. I thought my hammering technique improved over time, but I couldn’t help but notice every time I returned from a water break that a tremendous amount of work had been done in my absence.

Overall, I had a wonderful time and learned a lot of really useful stuff. Next time a hurricane hits town, my neighborhood team will be ready to re-roof as needed.

Orange County Habitat for Humanity has work sessions every Wednesday, Friday and Saturday. Go to to sign up for a shift. You’ll do things you never imagined you could. Just bring sunblock.
— Nancy Oates

The Confederate flag: Whose heritage?

I have never heard any black Southerners defend the Confederate flag as a symbol of their Southern heritage. The heritage defenders seem to be an exclusively white group, often with the “I used to be somebody” mindset of people hanging onto the glory days of their ancestors.

On May 20, a Saturday morning with made-to-be-outside flawless spring weather, several dozen people chose instead to sit indoors and listen to a panel discuss how wearing or displaying the Confederate flag in a public school fits with the First Amendment (freedom of speech) and the Fourteenth (equal protection).

The Chapel Hill-Carrboro NAACP hosted the event, held at Hargraves Community Center, to have a level-headed conversation before some incident ramped up the issue into crisis mode. Panelists were history professor emeritus Reginald Hildebrand, UNC law professor Al Brophy, N.C. ACLU executive director Karen Anderson, and Ronda Taylor Bullock, co-director of Duke University’s Cook Center on Social Equity. Their insights opened the audience to different points of view.

Hildebrand said it was impossible to separate the flag from the cause it represented, and while supporters of the flag may not think only of slavery, the Confederacy was founded on the notion that “the negro is not equal to the white man,” as Confederate Vice President Alexander Stephens declared in a speech shortly before the Confederate army attacked Fort Sumter to begin the Civil War.

The flag served as a symbol of white defiance of civil rights, Hildebrand said.

Brophy noted that the previous day New Orleans had removed the last of four statues honoring Confederate leaders, and that made him uneasy. “Don’t take down statues and check the box that racism is gone,” he said. “Change racism through the actions of humble people who are not in charge.”

To better understand the rise and fall of the Confederacy, he recommended the 2016 movie Birth of a Nation.

Bullock urged schools to do a better job of teaching students from a young age the history of the Confederacy and what its flag stands for. She said allowing the Confederate flag to be displayed on clothing in schools didn’t so much offend students of color as hurt them, even traumatize them. “Are we teaching that happiness belongs to white people, and they get to decide who experiences it?” she asked.

Anderson noted that the 4th Circuit Court ruled that schools can place limits on free speech in dress codes when it causes a disturbance, such as Confederate flag or Malcolm X T-shirts. But she seemed reluctant to broadly ban such messages. She argued for guiding principles, though cautioned: “Do guiding principles open the door or close it?”

The panel facilitator wondered, “How do we reach the people who aren’t here but need to be?”

The Chapel Hill Public Library has DVD copies of the 2016 version of Birth of a Nation, a powerful film that puts the Confederate flag in context.
— Nancy Oates

Use housing market forces to help

So much for the law of supply and demand.

Council has approved a plethora of high-end market-rate apartments because a majority of council members believe that flooding the market with high-rent units will saturate housing demand and eventually inhibit rent hikes. These council members ignore the fact that in Chapel Hill, as in most cities, an abundance of pricey rentals raises the rent floor all over town. An apartment that previously rented for $700 a month now charges $1,000 because that increase appears affordable compared to the $2,000 average in the new buildings.

Now these high-rent buildings are coming online, and there aren’t enough people willing to pay such rates. Many units sit empty. But instead of lowering rents to fit the market, these landlords have quietly advocated for a taxpayer bailout. Landlords want taxpayers to subsidize the rent and use some of those empty units for affordable housing until full-price tenants move in.

This proposal holds good news and bad news.

On the plus side, affordable housing would be mixed in with market rate, providing the landlord doesn’t designate one section of the building as the low-rent district. Studies show that the most successful affordable housing initiatives blend subsidized units with market rate tenants.

On the other hand, a bailout would not create the time and space for supply-and-demand tensions to impact the market. And many landlords enacted policies to rid their property of low-wealth tenants, so taxpayers making it possible for those folks to move back in might be inviting them into a living situation where they would be made to feel unwelcome. If the town were to institute a program subsidizing market-rate units, I would lobby strongly that the landlord’s history with low-wealth tenants be taken into consideration.

A taxpayer bailout of existing units would be a better fiscal deal for the town than having to build new units. But we would need to set some parameters. For starters, the town would have to negotiate how long the units would remain affordable. Having a year-to-year agreement does not provide the stability most tenants seek.

Clumping the affordable units together in one section would warrant closer scrutiny. The least desirable apartments, second-floor units, for example, have lower rents, as do those on the back of the building near the dumpsters, and these would be the natural choice for affordable housing. But if a landlord set aside one section of a complex for the affordable units, that might be unnecessarily ostracizing low-wealth tenants.

Finally, I would press the town to draw on the model health-insurance companies use: capped charges. If my physician sends me a $500 invoice for an office visit, my insurance company might say it caps the cost of a visit at $300, which would be applied to my deductible. An “in network” physician would honor the $300 cap, and that’s all I would be charged. I would expect landlords to honor the “in network” system, especially if the length of time the units would remain affordable is significantly less than 30 years.

We have some opportunities, but we must make sure they improve the functioning of the town as a whole.
— Nancy Oates

Classic decision-making

The world would be better off if we had more classics majors.

This past weekend, with so many universities in the Triangle showcasing their accomplished faculty and alumni as part of commencement celebrations, I couldn’t help but notice that innovation and entrepreneurship took the spotlight. Applied sciences got the glory, along with the plethora of business start-ups. Faculty, long used to the pressure of publish-or-perish, now must have a start-up on their resumes to be competitive. A majority in the General Assembly and many of their appointees on the UNC System Board of Governors push “job-readiness” as a goal of university graduates, essentially aiming to turn universities into vocational-training schools.

Governing bodies of late seem to dismiss the importance of the ability to recognize facts, analyze data, think critically, learn from history, see situations from various viewpoints and grasp the far-reaching consequences of decisions. For some reason, governing bodies don’t see those skills as relevant to job-readiness. But classics majors know differently.

Leaders in ancient Rome made a point of seating people of diverse opinions and “skill sets,” as it were, on their ruling body. For a long time, their civilization flourished. It broke down as the aristocracy separated itself from the rest of the population and began making decisions that would benefit the wealthy.

The founding fathers of the U.S. also aimed for diversity of thought among its members, and the U.S. rose to the point where it was considered the leader of the free world. Then elected officials began making decisions that benefited the wealthy primarily, and we have been spiraling downward ever since.

We’re all watching Washington burn during the current administration. And the smoke has filtered down to the local level, as judged by the Orange County commissioners’ recent decision to spend another $70 million on a light rail that will serve primarily those financially well off.

My hope is that Town Council can avoid those mistakes.

A classics major not only understands history but examines what sets humans apart from other life on earth; what made civilizations rise and fall; what is important to quality of life beyond access to clean water and food, safeguarding people and a way to connect with other communities.

Many of us on council benefited from a liberal arts education; some of us concentrated on the humanities. I would hope our decisions reflect the depth of thought and the respect for diverse opinions that we learned decades ago at the beginning of our careers.
— Nancy Oates

How we got DOLRT debt

I pay off my credit card debt in full every month. Those in the credit card industry refer to my ilk as “deadbeats” because the credit card company reaps no interest from me, only the 3% fee from merchants. I’m fiscally conservative, and it will take more than name-calling to convince me to pay usury-level interest when, instead, I can use someone else’s money for a month for free.

People on the other end of the spectrum make only the minimum payment on their credit card each month. The debt goes on forever while they pay little more than interest only. Their rationale is to ignore paying down the debt because at some point they’ll die and the debt will be someone else’s problem.

Five Orange County commissioners are in the latter camp, foisting more than a billion dollars of debt interest from the Durham-Orange County Light Rail Transit on taxpayers and their children — and perhaps their grandchildren. The loan already stretches out nearly half a century, and because commissioners say they won’t raise taxes to pay overages of DOLRT construction, they will have to refinance to extend the term of the loan and accrue additional interest costs for several years more.

Carrying a large debt load limits what one can do. Holding massive credit card debt prevents you from getting a mortgage to buy a new home or a loan to buy a car. On the county level, that translates into less money for buses that have the flexibility to serve commuters regardless of where housing springs up, and less ability to adapt to changes in transportation technology.

Another theory has emerged as to why the five commissioners voted for DOLRT debt: They believe the federal government won’t contribute funding to the project, effectively quashing it. The Trump budget had no additional money for transit projects. Congress countered with a budget that had money for “Small Starts” — Bus Rapid Transit falls under that category — but no money for “New Starts,” which is the category DOLRT falls into.

The federal government “scores” every project wanting funding to determine whether it is a worthwhile use of taxpayer money. Because the price is so high and the number of people paying it is so low, the federal government may deem the project a poor risk. Unfortunately, by their “yes” vote for DOLRT, the five commissioners have committed to spending an additional $70 million in engineering costs, on top of the $30 million already paid for studies.

By voting for DOLRT, the five commissioners will be able to tell special interest groups that they supported DOLRT and tell taxpayers the $3.3 billion burden has been reduced to “only” $100 million in unreimbursed expenses.

Debt, used judiciously, can be used as an investment to improve our quality of life. For commissioners to use it as a ploy to enhance their political prospects does a disservice to those they represent.
— Nancy Oates

Trumped in Orange County

The Trump Era has pierced Chapel Hill’s bubble.

Last week five of the seven Orange County Commissioners voted for taxpayers to take responsibility for 18% of the Durham-Orange Light Rail Transit costs not covered by federal and state governments, plus 18.5% of the debt service, on top of 20% of the regular maintenance costs of the 17.7-mile train service.

The media reported Orange County’s share as 16.5% with private investors kicking in 2% in cash and land donation, but if the investors fall short, Orange County picks up 1.5% and Durham covers the remaining 0.5%.

One of the commissioners who voted for DOLRT shrugged off constituents’ concerns about the staggering debt with: “It will work itself out.”

Where have we heard that before? Ah, yes: “We’re gonna build a wall — huge wall — the biggest wall, ever. And Mexico’s gonna pay for it.”

But wait, there’s more.

The agreement the five commissioners approved has a clause that prevents the county from backing out of the project at any time down the road. The Federal Transit Administration requires unwavering commitment that local governments will follow through on their end before the feds will commit any money to go forward. The feds would consider a maximum contribution of 50% of the $2.4 billion construction cost only. The feds won’t pay any of the cost of borrowing — the debt service that brings the price tag to $3.3 billion is the responsibility of local taxpayers.

The Trump budget revealed this week, albeit a back-of-the-napkin sketch, included no money for new transit projects. Bus Rapid Transit would be eligible for federal funding because it is already underway, but may not be able to be built without a greater contribution from Orange County taxpayers than the DOLRT agreement allots.

The Republican-dominated General Assembly capped any grant it might make at 10%. Heavily Democratic Chapel Hill and Durham would be naïve to expect the maximum.

The county’s plan for paying its share involves cutting bus hours and limiting the amount it will allot to the Bus Rapid Transit project. It also banks on the economy experiencing no downturn in the next half century. Even so, some years the county will have as little as $200,000 in cash reserves.

The five commissioners who voted to take on this debt did so knowing that a state law is in the works that would prevent the county from charging developers the impact fees that pay for school construction. A bill already passed reduces class size in early grades, which means counties have to find money for additional classroom space and more teachers. The start date has been delayed a year to enable counties time to budget. Orange County, instead, decided to commit to a train that serves those wealthy enough to afford the high rents GoTriangle said to expect from housing within walking distance of a rail station. The working class must fend for themselves.

“You want more Trump?” five county commissioners taunted. “Here’s how you get more Trump.” And they voted Yes on DOLRT.
— Nancy Oates

Historic professionalism

Days after the Historic District Commission meeting last week, the unsettling exchanges have stayed with me. Once again — and this happens routinely — an applicant requesting a Certificate of Approval treated the commissioners with disdain, as though they were something that must be scraped off the bottom of a shoe.

I’ve been to meetings of the Planning Commission and the Community Design Commission and observed applicants seek approvals with arrogance, the sort of Leona Helmsley “only the little people pay taxes” arrogance that sometimes accompanies those who did not grow up with wealth but see The Big Payoff almost within their grasp, or from those who are used to getting what they want without having to give in return. But I haven’t heard there the dismissive tone, the outright rudeness, that the HDC encounters.

In the year and a season I’ve been the HDC liaison, my respect for the commissioners has grown. The board harbors extraordinary depth of expertise that covers architecture, engineering, landscaping, law, design, history, genealogy and a love of historic buildings. All members live in a historic district or have in the past. Most bring a career’s worth of experience to their deliberations.

The state offers no protection for historic structures. If the HDC denies a property owner’s request to demolish a historic house, the owner can simply wait a year and then tear the building down. The commission tries to find a balance between allowing new owners to enlarge historic houses and preventing a historic neighborhood from becoming a row of McMansions.

And for this, these commissioners who volunteer their time and expertise are verbally spat upon, yelled and cursed at, and threatened with lawsuits. The town has hired a lawyer to attend each meeting and advise the board and has added extra staff for ballast.

But the most direct solution would be for applicants to treat the commissioners with common courtesy.

The obnoxious applicant last week was before the commission because he had purchased a house in a historic district and commenced renovating it without approval. He demolished a historic fieldstone wall, and town staff were working with him to enable him to avoid fines. Rather than start with an apology and an explanation of what he wanted to do, he took a combative stance, laced with passive-aggressive eye-rolling, deep sighs and calling one commissioner by a diminutive name, though everyone’s nameplate was clearly visible.

The commissioners showed admirable professionalism, granting him permission for some work and explaining what additional information they would need from him before ruling on the remaining renovations. The applicant’s lawyer followed him out of the room. I only hope she schooled him on the basics of social commerce to prepare him for his return appearance.

I extend my thanks and admiration to the commissioners, for their patience and forbearance and willingness to return for the next meeting prepared to give everyone a fresh start.
— Nancy Oates

If we build it, they will park

We walked to our downtown E. Franklin Street church Easter morning to avoid a lengthy search for parking.

The Morehead lot fills up quickly, as does Lot 2 on the corner of E. Rosemary and Columbia streets on a typical Sunday morning. Sometimes the Wallace Deck has no room, either. Bub O’Malley’s gravel lot used to serve as overflow parking, but now it posts “No Parking, Towing Enforced” signs every six feet. Although I know some of the town’s “boutique” lots that often have space, they’re all on the west end of downtown. By the time we drove there and walked back east, we might as well have walked from home.

The town recently added some spaces on the west end of downtown in a lot behind buildings on the south side of W. Franklin, accessible via Basnight Lane and S. Roberson. Even so, we have a deficit of some 250 spaces, and that has hampered growth. A proposed music venue, office and apartment project is on hold until the town can create sufficient parking spaces. The town’s Land Use Management Ordinance does not require downtown property owners to provide any parking.

At the Town Council work session last week, we heard a proposal to add up to three levels of parking to the Wallace Deck, which would add 100 spaces per floor. The cost would be $2.4 million for one story and $8.4 million for three floors, the much higher price for three stories coming from the extra structural support needed to hold the weight of the two more levels of cars.

We previously had explored putting offices or apartments above the deck, but realized that we wouldn’t have enough parking spaces to accommodate those new tenants.

Adding one more floor of parking seems the prudent choice. The deck needs a $1 million weather membrane that had been value-engineered out at construction and now has caught up with us. Adding a level of parking would eliminate the need for that work.

The spaces wouldn’t pay for themselves until after the construction loan is paid off, but we need to support downtown businesses that have told us for years that potential customers stay away for want of a place to park.

Some folks have a theory that making it hard to drive or park will encourage people to walk, bike or take the bus. They forget that a third of our population is senior citizens, that grocery stores prefer a super-store model over building small neighborhood stores, that the majority of parents have tight schedules trying to balance work with children’s activities, and that many people work hours beyond the bus schedule.

Back to that walk to church: We arrived sweaty and parched, our hair flecked with oak seeds, and mascara bleeding down my cheeks. Our fellow parishioners are a forgiving lot, but had we been going to a business meeting, walking or biking would have been impractical.

The town could add a penny to the Downtown Service District tax or raise the parking fee to $2 per hour from its current $1.50. Either way, we need to move forward with adding parking downtown where we can.
— Nancy Oates

Chapel Hill’s Central Park?

Dream first; set your sights; then figure out what you have to do to get there.

That philosophy has worked for me over the years, and town staff used it, too, last Saturday by hosting a charrette to find out what value taxpayers believe the 36-acre parcel we bought from the American Legion could add to our quality of life.

The charrette drew a wide cross-section of residents — families, young professionals, retirees and pickleballers — a surprisingly large crowd, given that the beautiful spring weather made it hard to stay inside. The charrette was billed as a drop-in session where people could stop by, see what was what, and add a sticky note of their ideas to the wall. However, many people stayed for hours, brainstorming and establishing priorities, sketching maps, and asking questions about what constraints might hamper their vision.

As the day progressed, it became abundantly clear that taxpayers want to use the land as a community gathering space. How that might look varied widely. Some maps showed a smorgasbord of options. Connectivity came through paved bike and walking trails. Some made room for a farmers market and food trucks. Many wanted a building that could be rented out at modest cost for weddings and meetings. Others wanted a building for dance classes (which requires special flooring) or volleyball tournaments.

Ideas for a skate park, an Olympic pool, basketball courts, competition-grade pickleball courts, picnic pavilions and toilets all made the wish list. The school board asked that the ball field be moved to the American Legion parcel to enable expanding Ephesus Elementary, which would share its parking in return and contribute to maintenance in return. Liberty Health offered to buy a section of land to create a graduated care community. No one left the 3-acre pond intact: It was relocated or made smaller or removed altogether. The natural wooded areas with the well-worn trails running through survived intact, for the most part.

Town staff agreed to research the nuts-and-bolts: How much parking would a park and community space like this require? What restrictions does the Research Conservation District impose? How much improvement to Legion Road would be needed to accommodate this destination spot? What did the engineering report say?

And, of course, how do we pay for all this? The town had cash-on-hand to make the first of three payments spread over three years. Bond money could be tapped for the second payment, if increased tax revenue from all the new apartments coming online is not as much as expected. And in three years, if tax revenue still falls short of expectations, the town could sell off a slice of land along Legion Road to make the final payment and put more toward hardscape.

Clearly, the infrastructure will have to be phased in, as it likely will cost more than the purchase price of the land. But from the enthusiasm and hope in the room Saturday, I’m confident we will find a way to turn this land into an area that serves all of us. We will find creative ways to turn our dreams into reality.
— Nancy Oates