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Section 2-137 of the Hawai'i County Code emphasizes that grant payments to non-profit <br /> organizations should result in direct benefits to the public and serve a public purpose, we found <br /> a gap in the eligibility criteria. Specifically,the enumerated list of requirements does not effectively <br /> assess whether a program aligns with the intended public purpose. This deficiency raises the <br /> possibility that organizations formed to benefit the residents of Hawai'i County could develop <br /> programs that do not fulfill the criteria for a qualifying public purpose. Furthermore, the lack of <br /> clear enumeration in the eligibility criteria may lead to oversight during the initial vetting process. <br /> Additionally,ARTICLE VII Section 4.The Hawai'i State Constitution states,"No tax shall be levied, <br /> or appropriation of public money or property made, nor shall the public credit be used, directly or <br /> indirectly, except for a public purpose. No grant shall be made in violation of Section 4 of Article I <br /> of this constitution. No grant of public money or property shall be made except pursuant to <br /> standards provided by law." <br /> To improve internal controls over the County's grant-in-aid processes, we provide six <br /> observations and suggestions to ensure compliance with Article 25 and best practices. <br /> Observation 1 <br /> Opportunities to Establish a More Substantial Public Purpose Alignment. <br /> We suggest the Hawai'i County Council amend Hawai'i County Code Article 25 to establish <br /> alignment with the state constitution regarding serving a public purpose and benefit by <br /> enumerating both as a criteria. <br /> Section 2-139 (C) of the Hawai'i County Charter states, "The director shall submit to the council <br /> all qualifying applications as provided in sections 2-137 and 2-138 for its review and appropriation <br /> of funds."This leads to a natural conclusion that forwarded "qualifying applications" conform with <br /> all seven elements of the Hawai'i County Code §2-137 and the other six elements of §2-138. <br /> However, this is not the case. The Department of Finance does not verify all elements of these <br /> two sections. <br /> Observation 2 <br /> Opportunities to Clarify Roles and Responsibilities. <br /> We suggest the Department of Finance work with County Council to clarify the responsible party <br /> for individual items related to §2-137 and §2-138 of the HCC. <br /> 6 <br />