JACKSON — The fate of the new Department of Social Services facility is once again in limbo following the results of a facility cost analysis.

On Monday, the Northampton County Board of Commissioners agreed to not take action on the construction of a new DSS facility until the Local Government Commission (LGC) move on the matter Tuesday.

The county hired Maximus to complete the analysis in order to gauge what the percentage of reimbursement the county would receive on the project.

The $7.46 million project, funded in part by a $6.96 million loan and a $500,000 grant from United States Department of Agriculture-Rural Development, relies heavily on a 65 percent reimbursement from the federal government for the services provided by Northampton County DSS.

The board’s decision comes after the results of a facility cost analysis showed Northampton County “DSS has experienced an average recovery rate if 56.2 percent for the most recent 12 months.” The report also notes the monthly recovery rate for the department varied “from a low of 48 percent to a high of 66 percent.”

“Remember, our numbers and what we had talked through and the cost share was based on 65 percent,” said County Manager Wayne Jenkins.

Jenkins added an important fact for the board to keep in mind is as decision-makers in Washington D.C. reduce the country’s deficit it was likely to effect services.

“So when the amount of services at the federal level is reduced, then it generally trickles down, affects states, affects counties with less money for the same services,” he said. “As those reductions are expected at the federal level, we’ll have less money for the services we’re delivering today, which means our staff will spend less hours administrating the program and according to the feds, we’re likely to use and need less office space to deliver those watered down programs. What that does is it reduces that 56.2 percent even lower.”

Jenkins said as that percentage reimbursement is lowered, the county’s share out-of-pocket goes up.

Jenkins referred to a break down of the county’s payments included in the report.

For the first year, the county’s payment on the new facility would be $399,081 and annual depreciation (31.5 years) at $205,602.

Jenkins noted the latter is not a cash number but a value number that cannot be used while calculating the annual debt payment.

Allowable interest on the report for the first year is listed at $275,637. Total allowable cost is listed in the report as $481,239, total estimated recoveries at $270,456 and the estimated county expense $128,625.

“This (report) is prepared using the new regulation GASB (Governmental Accounting Standards Board Statement 34), which requires counties and municipalities and units of government to report their financials as does the private market—general profit/loss,” he said. “That’s where depreciation comes in, when you’re trying to determine your profit or show a loss.”

Jenkins said when the 56.2 percent average is applied to the debt payment of $399,081, the reimbursement for the county stands at $224,284 with a $174,797 out-of-pocket cost for the county for the first year.

Jenkins also provided the figures for the “extremes” on reimbursements with the low of 48 percent. He said the debt payment cost would increase by approximately $35,000 a year, which over a 31 year period would lead to $1 million of direct cost to the county.

“The first thing that comes to my mind is why do we want to go into debt if we’re not going to be able to provide the same kinds of services and the same amount of services,” said Commission Vice Chair Virginia Spruill. “Why would we want to be able to build a building? If everything is going to be decreasing, but our debt payment is probably going to be increasing.”

Jenkins asked if the commissioners needed any more information for them to make a decision.

After further discussion, Spruill questioned if a tax increase would be required to build the facility.

“Mrs. Spruill to build this building and meet our debt payment there’s no way to do it without using tax dollars,” Jenkins said.

He added ad valorem taxes are the largest source of revenue for the county and if the county did not have enough revenue for debt payment the board had two choices: raise taxes or cut services.

“We knew from day one there would be tax money involved, but my question goes along with what Mrs. Spruill said, are we going to have to raise taxes and it sounds like, yes,” said Commissioner Fannie Greene.

“Unless you want to cut services,” added Jenkins.

“But then we’re defeating ourselves, are we not,” questioned Spruill.

“This is not easy,” said Jenkins.

Commissioner Robert Carter, who serves on the Northampton County DSS Board, said he wanted to make comments on the matter, possibly offering a source of revenue for the project.

Carter noted two large projects currently in the works (the Envivia wood pellet plant and the Hampton Farms expansion) which will bring more tax revenue to the county.

Commission Chair James Hester disagreed with the notion of spending money the county didn’t have.

“Now what we’re talking about here is, first of all, spending money that we don’t have, spending money we don’t have a guarantee on,” he said. “But at the same time we have a guarantee that federal funding to our county for Social Services and for various programs in our county are going to be cut, because that’s the bottom-line. They’re saying it’s going to be a drastic cut. The Board of Health has already been cut tremendously and we’ve got to make it up somewhere.”

“We don’t know,” said Carter. “Yes, the economy has gone south in the past 24-36 months, but it’s revamping. Be optimistic.”

“But you’ve got the ‘iffys’ and you go into something like this and it does cut like they’re saying they’re going to and the county has that debt, what are you going to do?” said Hester.

After further discussion, Carter presented the board with a list of comments he had on the DSS facility.

He noted the county had already expended $498,516 on the project for the purchase of land, architect fees, “and other fees associated with the project.”

“Are we going to lose that money,” he asked. “I know as frugal as this board is you’re not throwing away a half a million dollars.”

“But you still have the land,” said Hester.

Carter responded the board would have still thrown away more than $350,000.

“That $498,000 will come back to the county if the LGC approved this project,” he said. “That money is not earmarked for nothing. There is your first annual debt payment right there in those funds.”

He added by the time the second debt payment came around Enviva and Hampton Farms would be paying additional taxes.

“We are worried about where the money is coming from, it’s already here,” he said. “We already have it. It’s in the bank. The money is in the bank.”

“Would you write a check on that,” asked Hester.

After further discussion, Carter moved the board not take action until after the LGC has made its decision. Commissioner Chester Deloatch offered a second and the motion passed in a 4-1 vote with Hester voicing his opposition.

The commissioners will reconvene at 10 a.m. on Thursday.