The Daily Tar Heel

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Monday January 24th

Chapel Hill Wants More From UNC

The state pays Chapel Hill for services the town gives to UNC, but town officials say UNC should give more.

Fiscal equity has become an issue because some town officials feel the University has not been giving fair and equal compensation to Chapel Hill for the town's services, like fire protection, said Nancy Suttenfield, vice chancellor for finance and administration.

Chapel Hill Finance Director James Baker said the state pays the town a set amount to conduct services for the University but that the funding provided is insufficient. He said he hopes UNC will be willing to make up the difference in the future.

Fiscal equity has been a topic of ongoing discussion for the last 20 years, Baker said.

Special assistant to the chancellor Jonathan Howes said the issue first arose when Chapel Hill Mayor Rosemary Waldorf and Chancellor James Moeser were co-chairmen of a town-gown committee in November 2000.

Members of the town-gown committee from the University included Suttenfield, Howes and Sue Ehringhaus, vice chancellor and general counsel for the University. Participants from the town included Chapel Hill Town Council members Kevin Foy, Lee Pavao and Bill Strom and Town Manager Cal Horton.

But much of the town-gown committee's meeting time during the last few months has been spent hashing out the details of the Development Plan, an eight-year plan for the University's growth.

"It wasn't in the Development Plan, but it was part of the agenda of the town-gown issues that the mayor and the chancellor's committee agreed to look at," Howes said.

But Howes said the University has not had an opportunity to address the issues that arose -- both before the Development Plan and as a result of the negotiations of that plan.

"We -- both the University and the town -- put (fiscal equity) on the back burner while we were working on the Development Plan," Howes said.

He said now that the Development Plan has passed, the committee has time to discuss the issue before Waldorf steps down Dec. 7.

"We did the Development Plan first, but the mayor in particular was eager to address the issue before she left office," Howes said. "It was a high-priority issue for her."

While some areas of contention are immediate services such as fire protection, cleanup costs and emergency medical service, others are policies regarding property and property taxes, Suttenfield said.

Property issues mainly arise from land the town has jurisdiction over that is used for University purposes, such as fraternity and sorority houses and parks.

Baker said the town also is required by law to provide fire protection to the University.

The state gives the town a specified amount of funds to provide this service, but the costs to the town exceed this amount, Baker said.

"The town's going to pay for the difference one way or another," Baker said. "Citizens pay for it, or other taxes or revenues from the state help pay for it."

Board of Trustees member Stick Williams said town officials feel that Chapel Hill loses tax revenue because state property, including the University, makes up a significant part of the town, and UNC does not pay property taxes. In addition, the town provides services it is not compensated for, he said.

"I think the University has expressed a lot of willingness to partner with the town in going to the General Assembly to determine what is equitable, and how to then reimburse the town for those services," Williams said. "That's one of the most significant things the University can do."

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