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Philip Morris closing may affect schools

By Karen Cimino Wilson | Independent Tribune

Published: May 1, 2009

Cabarrus County commissioners OK'd the release of $100 million for school projects last week, but it's unclear what will happen now that Philip Morris Plans to close this July — more than a year earlier than originally expected.

Cabarrus County commissioners voted last week to approve installment contract financing for public school projects at Hickory Ridge Middle, Charles E. Boger Elementary, a northwest area middle, a lower Rocky River elementary and a replacement for A.T. Allen Elementary.

Pam Dubois, the county finance director, told commissioners last week that bids for school projects were coming back below earlier estimates, saving the county about $17 million.

County officials had planned to sell the certificates of participation for the projects in May, but that could change, according to county officials. COPs are financing agreements in the form of securities that can be marketed to investors.

Already, Cabarrus County has made cuts to survive a $6.1 million budget shortfall for fiscal year 2009 and county leaders anticipate a shortfall of $12.5 million for fiscal year 2010. Those estimates did not factor in the Richmond, Va.-based cigarette manufacturer's closing, because the original closing date was expected to be at the end of 2010.

County manager John Day recommended earlier this year that Cabarrus County commissioners cut the $209 million budget by 2.9 percent to make up the difference in the current budget. That also meant a 2.9 percent reduction in the local school budgets.

Philip Morris paid about $6.6 million in property taxes to Cabarrus County last year. The property has a total assessed value of about $1.1 billion.

The announcement could affect decisions about the budget, said county spokeswoman Aimee Hawkins.

"We're still assessing the impact of Philip Morris closing," Hawkins said. "We don't have any conclusions at this point."

Commissioners will get a brief overview of the county budget at their work session Monday.