COM 0717.000 2004-2006 - Laserfiche WebLink

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The Honorable Chairman Stacy Higa and Members of the County Council Page 3 March 1. 2006 AFFORDABLE HOUSING In addition to property tax rate reductions, a bill to enable properties rented at "affordable" rates to receive an appropriate tax break will be submitted before the end of this year. It will also enable owners of properties that would otherwise qualify to be in the Homeowners class rent a room out without being disqualified from the class. RESERVES Included in this budget is funding for a new reserve account that is very important for the future: • "Rainy Day" Fund, $4,000,000. A bill to create a "Rainy Day" Fund will be submitted shortly. Its purpose is to enable the County to continue providing services to the public without having to increase taxes during economic downturns. In addition, $4,000,000 is being budgeted for accrued retiree health care benefits. Recent regulations regarding financial reporting for government entities (GASB 45) require that the full liability for post employment health care benefits be reflected in financial statements. The County of Hawaii currently funds retiree health benefits on a "pay-as- you-go" basis. This has resulted in a large unfunded liability for future benefits. After the liability has been actuarily determined, it will be necessary to initiate catch-up payments over a period of years to fully fund the future liability and maintain a positive bond rating. Funding for other reserve accounts has also been included in this budget: • Public Access, Open Space, $3,000,000. • Self -Insurance Fund, $1,000,000. • Disaster Relief Fund, $500,000. OTHER BUDGET HIGHLIGHTS and Natural Resources Preservation Fund, In addition to setting aside reserves for the future, this budget adds supplemental funding for these major areas of need: Improving Parks and Recreation Services • Provide $700,000 to offer municipal golf rates in West Hawaii. Negotiations are taking place with two golf courses in West Hawaii. • Establish 5 positions and purchase necessary equipment to maintain the Old Kona Airport as a County park. We anticipate that the State will be transferring the responsibility for this park to the County.