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Home My WebLink AboutCOM 0623.000 1996-1998 wi es y~K . ~j ~ Abu%¢, ~ DONALD IKEDA I•i' ALAN S. KONISH( County Clerk _ Deputy County Cferk 'MJ~ I Or~MI CONSTANCE R. KIRIU OFFICE OF `i'HE COUJ~`rY CLERK Legislative Auditor County of Haumi Haunii County Building 25 Aupuni $trttt Hib, Hauaii 96720 r-; - - t ~ ~ ' ~ , December 9, 1997 TO: James Y. Arakaki, Chair And Council Members FROM: Constance R. Kiriu'", ~ Legislative Auditor RE: Post-Audit Report of the County of Hawaii Fiscal Year Ended June 30, 1997 For your review, deliberation, and acceptance, I am submitting the post-audit Financial Report of the County of Hawaii for [he Fiscal Year Ended June 30. 1997, as prepared by Deloitte and Touche. This report satisfies the requirement of Section 10-13, Hawaii County Charter, relating [o the responsibility of the County Council to conduct an annual independent audit of the accounts and other evidences of financial transactions of the County and of every county agency and executive agency. This year's observations and recommendations include the potential for significant problems adjusting the County's computer systems for the year 2000; consideration of an internal audit function; and the need to improve the collection of past due sewer and landfill receivable accounts. The auditors will be present at the Finance Committee meeting on January 6, 1998, to answer any questions you may have. Enclosure cc: Mr. John Marrack Ms. Deanna Bauman c:~ x~. V ~3 x.. ~u-~ trot. loot. DEC 0 9 1997 i ~yS ~~ry) jry ~ C J e( (J; , F. f~ rte.: ~ ~ 1 BOUNTY 'V'~'AII ~r~ e, o'~~~Y~~~ ~q~~ t_ ._v. x • ~ i~~`~-:~ z . ~ ~ ~ . • ~ s ~ s 1 ~~•~:~NA Mp~rP~` 'qTF QF •H P~1 ' Financial Audit Report for the Fiscal Year Ended June 30,1997 „ ATTACHMENT TO C-623 FOREWORD This financial audit report is the result of the audit of the financial statements of the County of Hawaii, State of Hawaii, for the fiscal year ended June 30, 1997. The audit was conducted by Deloitte & Touche u.P, certified public accountants. The audit was performed in accordance with generally accepted auditing standards adopted by the membership of the American Institute of Certified Public Accountants. In addition, the audit was governed by the "Specifications for a Financial Post-Audit and Systems and Procedures Examination of the County of Hawaii," issued by our office. This report is divided into two sections. Section I, "Internal Accounting Control and Administrative Matters," includes the auditors' Endings and recommendations based upon their evaluation of the adequacy and effectiveness of the County's internal accounting control and accounting procedures done in connection with their audit of the County's financial statements for the fiscal year ended June 30, 1997. It is our practice to request agencies to submit their comments on the auditors' findings and recommendations and to indicate what action has been or will be taken. Section II, "Comprehensive Annual Financial Report" for the fiscal year ended June 30, 1997, displays the financial statements and schedules of the County, the auditors' report as to the fairness of presentation of the financial statements and also includes statistical information. We wish to express our sincere appreciation for the excellent cooperation and assistance extended by the management and staff of the various departments during the audit. Constance R. Kiriu Legislative Auditor County of Hawaii COUNTY OF HAWAII FINANCIAL AUDIT REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 1997 Table of Contents Section Pave I. INTERNAL ACCOUNTING CONTROL AND ADMINISTRATIVE MATTERS Independent Auditors' Report on Compliance and on Internal Control over Financial Reporting Based on the Audit of the Financial Statements 1-2 Current Year's Observations and Recommendations 3-7 Comments by the Affected Agencies 8-13 Status of Prior Years' Observations and Recommendations 14-15 Appendix 16-19 II. COMPREHENSIVE ANNUAL FINANCIAL REPORT Introductory Section 1 Financial Section 17 Statistical Section 119 COL7NTY OF HAWAII FINANCIAL AUDIT REPORT FOR THE FI5CAD YEAR ENDED .TUNE 30,-,1997 j SECTION I` INTERNAL ACCOUNTING CONTROL AND ADMINISTRATIVE M;4TTERS COUNTY OF HAWAII FINANCIAL AUDIT REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 1997 SECTION I INTERNAL ACCOUNTING CONTROL AND ADMINISTRATIVE MATTERS Table of Contents Paee Independent Auditors' Report on Compliance and on Internal Control over Financial Reporting Based on the Audit of the Financial Statements 1-2 Current Year s Observations and Recommendations 3-7 Comments by the Affected Agencies 8-13 Status of Prior Years' Observations and Recommendations 14-15 Appendix 16-19 Deloitte & Touche «P _ Suite 1200 Telephone: (808) 543-0700 1132 Bishop Street Facsimile: (808) 526-0225 Honolulu, Hawaii 96813-2870 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON THE AUDIT OF THE FINANCIAL STATEMENTS To the Members of the County Council of Hawaii County of Hawaii Hilo, Hawaii We have audited the general purpose financial statements of the County of Hawaii, State of Hawaii, for the year ended June 30, 1997, and have issued our report thereon dated October 27, 1997. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the County's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. Internal Control over Financial Reporting In planning and performing our audit, we considered the County's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the intemal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the intemal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the intemal control over financial reporting and its operation that we consider to be material weaknesses. DeloitteTouche Tohmatsu Itdernational - 1 - We did note other administrative and operating matters. Our comments, an•anged by department, are presented herewith. This report is intended for the information of the County Administration and the County Council. H" o~wever, this report is a matter of public record and its distribution is not limited. ~Glo; H~ t ov~La ~ `L I October 27, 1997 -2- CURRENT YEAR'S OBSERVATIONS AND RECOMMENDATIONS A. YEAR 2000 Observation: The County will have significant problems adjusting the computer system for the year 2000. Background: Last year we recommended that high priority be given to implementing formal procedures to assess the County's computer systems' capability relating to rollforward into the year 2000. The Data Processing Division (DPD) has prepared afive-page report titled The Year 2000 Problem Status & General Plan, dated July 24, 1997, which addresses only applications running on the County's central Wang computer. It demonstrates recognition of the Year 2000 problem and provides a high ]evel progress report. However, the report contains insufficient information to evaluate the validity of its recommendations. For example, Page 3 of the report contains time estimates to assess and fix the applications running on the central Wang computer. The report contains insufficient detail to understand the method of calculating the individual estimates (i.e., lines of code, level of complexity, documentation, etc.). In addition, time estimates for fixing 12 of the 20 applications listed were left blank. Of the 12 applications mentioned above, the following eight significant applications have not yet been evaluated: Payroll, Accounting, Budget, Manual Warrants, Purchase Orders, Sewer Billing, Real Property Data Inquiry, and Library Catalog System. The following four applications are expected to be replaced before the year 2000: Senior Citizen Information, Land Use Inventory System, Planning Permit Tracking, and Council Information Index. Page 2 of the report states that the actual deadline to complete the overhaul is a moving target and depends on when the individual applications need to process Year 2000 dates. DPD should identify the specific applications it is referring to in this statement and the deadline for each application to be converted. Testing of the Year 2000 fixes is not specifically discussed in the report. A timeline and detailed test plan to ensure data and processing integrity should be included in the plan. For County departments that have other than Wang computer applications, DPD issued a memo to all departments with instructions to either contact their vendors regarding Year 2000 issues, or contact DPD for assistance. The following are only a few of the problems that could occur on January 1, 2000: Appllcatlon Potential Problem(s) Payroll The system could shut down and County employees would have to manually calculate and type paychecks for more than 2000 employees each pay period. The County would also have to manually compile information for all necessary State and Federal payroll forms and tax reports. Accounting The system could shut down and County employees would have to manually maintain all accounting records, prepare all warrants, and -3- prepare the budget versus actual comparison reports. If this system fails, the annual audit may not be able to be completed which would affect the County's bond rating. Purchase Orders The system could shut down and the County's employees would have to manually prepare all purchase orders and determine funds to be encumbered. Budget The system could shut down and the County's annual budget would have to be prepared manually. Recommendation: The Mayor or Director of Finance should take immediate steps to ensure that all necessary year 2000 modifications are completed by 1999. Such steps should include setting benchmazks and developing a comprehensive plan that specifically addresses all yeaz 2000 issues for Wang applications and other department applications. For some applications, only 13 months may remain to address and resolve issues because some applications may project year 2000 due dates beginning in 1999. The County Council should require quarterly reports from the Data Processing Manager regarding the status of the implementation. B. INTERNAL AUDIT FUNCTION Observation: The County should consider the benefits of an internal audit function. Background: An internal audit function is generally used throughout an organization to determine that departments have adequately implemented internal controls and have complied with the County's operational and fiscal requirements, as well as those imposed by outside agencies. Examples of internal audit projects would include: audits of the cash functions of satellite finance department offices, and of the golf course, solid waste, cemetery and other special revenue funds. In addition to internal control compliance reviews, an internal auditor could perform special financial projects, such as: • Helping to monitor and follow-up on single audit requirements, such as the Corrective Ac[ion Plan. • Helping to monitor compliance of non-profit recipients of County grants. • Helping to resolve the receivables delinquency issues at the Wastewater and Solid Waste Divisions • Helping to resolve the issue of late filings for grant reimbursements • Helping the Director of Finance investigate potential revenue enhancement projects An internal audit function would show that the County is concerned that policies and procedures are being applied appropriately. -4- Recommendation: The Mayor or Director of Finance should evaluate the costs versus the benefits of establishing an internal audit function. C. PUBLIC WORKS RECEIVABLES Observation: Collection of past due sewer and landfill receivable accounts should be ' improved. Background: The following pie chart summarizes sewer and landfill accounts receivable as of ' June 30, 1997: Sewer and Landfill Accounts Receivable Penalties I 0% >180 days 22% Current 32% I >120 days 2% INOttggie >90 days K w '` 19% >30 days 13% >60 days 12% p As illustrated above, the delinquent sewer and landfill receivables comprise two-thirds of all sewer and landfill accounts receivable, while the accounts greater than 90 days past due make up over one-third of total sewer and landfill receivables. Delinquent receivables are $1,248,531 of total receivables of$1,842,368. The following graphs show the increase in uent accounts for sewer and landfill receivables. I - 5 - .rlM I . I Total Public Works Receivables(Sewer and Landfill) • 2,000,000 3 r1 1,800,000 Mw 1,600,000 1,400,000 y `—° 1,200,000 1111.11 cry2 4' i g0:4,1g r;' Q 3 1,000,000 �""r".�.....�.,_...-� C 800,000 ----Delinquent 600,000 —i--Total A/R 400,000 200,000 1995 1996 1997 Fiscal Year I Sewer Accounts Receivable 1,000,000 900,000 - 800,000 -- 700,000 ` ". ` 600,000 --- `—° 500,000 t, - •Delinquent 0 400,000 --- •Total A/R 300,000 200,000 ' '' 1 00,000 , 1993 1994 1995 1996 1997 I Fs cal Year I Landfill Accounts Receivable 1 900,000 800,000 700,000 y 600,000 �3 m 500,000 I•Delinquent 0 400,000 ' ■Total A/R 300.000 I 200,000 100,000 sun 0 1995 1996 1997 I Fiscal Year { Sewer commercial accounts aze billed monthly and residential accounts are billed bimonthly. After three billing cycles (90 days for monthly accounts and 180 days for bimonthly accounts), past due accounts are referred to either Corporation Counsel (balances exceeding $200) or to an outside collection agency (balances less than $200). Such referred accounts are called collection status accounts. The following procedures aze used for Solid Waste Division (landfill) receivables. Bills are mailed within 10 days of month end, collection letters are sent when accounts are past due, and, generally, accounts over $1,000 and over 90 days outstanding aze sent to the Corporation Counsel for further collection efforts. The Division pursues collections on accounts less than $1,000. The Division also pursues collection of certain accounts greater than $1,000, which accounts are deemed fully collectible and continue an active landfill business. Collection procedures appear to be in place for both sewer and landfill accounts; however, collection efforts are not aggressive, credit is rarely withdrawn, and phone contact is seldom made. More effective collection efforts should convert much of the delinquent receivables total of $1,248,531 to cash. This observation and recommendation has been repeated from last year. The Department has made little progress from last year. The Waste Water Division has requested proposals to contract for collection services; however, proposal responses have not yet been received and/or evaluated. Also, the Division and the Corporation Counsel have begun to schedule meetings with larger past due accounts. Recommendation: The Director of Public Works should: formalize and enforce credit, billing and collection policies and procedures for the department; consider using a private collection agency to collect on its accounts receivable greater than 90 days; and take a more proactive approach in its collections. The County should also record an allowance for doubtful accounts and write-off uncollectible balances. D. LONG-RANGE STRATEGIC INFORMATION SYSTEMS PLAN Observation: The County's systems plan needs to be updated. Background: The original Long-Range Strategic Information Systems Plan, developed in 1991, is now obsolete due to changes in the County's requirements and priorities, as well as information technology which was not available in 1991. For example, implementation of a County of Hawaii Internet E-Mail system and web page would improve the communication with citizens and improve information access to County information. In addition, DPD has already implemented or is in the process of implementing many of the projects recommended in the 1991 plan. Without an up-to-date systems plan, the "roadmap" to prioritize projects and allocate resources for County systems is missing. If DPD is unable to prepaze an updated plan due to its workload, then consideration should be given to contract for its development. Recommendation: Update the County's Long-Range Strategic Information Systems Plan. See Appendix for additional information on long-range systems planning. -7- C ~~?~tV OI .Z Stephen K. Yamashiro Harry A. Takahashi Mayor Dittctor S. K. Schulte ~Paty County of Hawaii DEPARTMENT OF FINANCE 25 Aupuni Street, Room 118 Hilo, Hawaii 96720-4252 (808)961-8234 • (808)961-8248 To: Connie Kiriu, Legislative Auditor CC: Stephen K. Yamashiro, Mayor\ G. Gail Rock, Data Processing Manager. - From: Harry A. Takahashi, Finance Director fit" I Date: November 24, 1997 Re: Comments Items A, B, and D of the Auditor's Recommendations. Thank you for this opportunity to comment on the Observations and Recommendations by the External Auditor Deloitte & Touche. We have reviewed items A, B and D and submit the following: Item A. Year 2000 The Data Processing Division prepared a report dated July 24, 1997 entitled The Year 2000 Problem Status and General Plan. The purpose of this report was to provide a status of the county's Year 2000 computer compliance effort as of the report date. While the report may not have been as extensive as the auditor would have desired, it recognizes that the county is aware of the urgency in addressing the computer compliance issues of the Year 2000. We have also reviewed the "Potential Problem(s)" identified in the observations and while we agree that the potential as depicted is possible we do not concur that it represents likely occurrences. The Data Processing Manager will be directed to prepare a schedule for the completion of the assessment of all Wang applications and the Director of Finance will be requesting reports from the respective deparhnents and agencies of their Year 2000 efforts. Item B. Internal Audit Function We concur with the Auditor's observation that the county should consider the benefit from an internal audit function. We will develop an internal audit program proposal for management consideration. Item D. Long-Range Strategic Information Systems Plan. We concur with the Auditor's observation that the county's systems plan needs to be updated. Since 1991, the county has made progress in developing its information systems and we do recognize that new technology has been developed since the completion of the 1991 Plan, however, the county has very limited resources to allocate toward this update at this time. Most of our resources are being allocated to the Year 2000 effort. We will review our Long-Range Strategic Information Systems Plan when we conclude our Year 2000 compliance In closing we would like [o emphasize that we are aware of the impacts of the observations, however, under existing circumstances of resource uncertainties, we need to establish priorities. Hopefully in the near future resources will improve to allow us [o embark upon a program which will fully satisfy the concerns. -g- r COUNTY OF HAWAII DEPARTMENT OF PUBLIC WORKS 25 AUPUNI STREET, ROOM 202 HILO HI 96720-4245 TELEPHONE: (808) 961-8321 FAX (808) 961-8630 MEMORANDUM DATE: November 28, 1997 TO: Connie Kiriu ~ _ Legislative Auditor THRU: Donna Fay K. Kiyosak Chief Engineer FROM: Nancy Crawford Acting Business Manager RE: Preliminary Draft Financial Audit Report for the County of Hawaii Fiscal Year Ended June 30, 1997 Recommendation: The Director of Public Works should formalize and enforce credit, billing and collection policies and procedures for the department. Response: Historically the responsibility for managing accounts receivable and collections has been assumed at the Division level, with each Division developing procedures specific to its unique billing requirements. The Department Business Manager will review the current policies and procedures and develop a departmental standard for credit, billing and collection. -9- wtr or ,y,~ Stephen K. Yamashiro Richard Wurdeman Mayor Corporation Couvd ,J~ ~ f ~~O~~Mt`~ ~nixixf~r of ~~tfiY~tti OFFICE OF THE CORPORATION COUNSEL 101 Aupuni Stree4 Suite 325 • Hilo, Hawaii 96720.4262 • (808) 961-8251 • Fax (808) 961-8622 25 November 1997 TO: CONNIE KIRIU Legislative Auditor FROM: RICHARD D. WURDEMAN f~yj ~ Corporation Counse ~//G SUBJECT: COMMENT ON DRAFT FINANCIAL AUDIT REPORT This is a response to your request for comment on the draft audit report on Public Works Receivables. As pointed out by the Auditor, room for improvement exists in the program. Several suggestions might help. 1. Solid Waste Collections should be on a cash or credit card basis. Merely noting license plate numbers and mailing bills later is not an effective method. 2. Sewer Bills - A program to link sewer bills to water service should be implemented. 3. Statutory change should be sought so that liens could be placed on properties with grossly overdue accounts. Such a bill was introduced last year, but failed to advance in the Legislature. 4. Long overdue collections on inactive or departed entitles should be written off of the books. RDW:1752Lbre -10- w SOLID WASTE DIVISION -DPW ' COUNTY OF HAWAII - 108 RAILROAD AVENUE - HILO, HAWAII 96720 -t w HILO OFFICE (808) 9G1-8339 WAIMEA OFFICE (808) 885-3687 KONA OFFICE (808) 326-1180 y~ Date: November 26, 1997 To: Connie Kiriu Legislative Auditor From: I Walter Lucas 1U~' Acting Division Chief Subject: Preliminary Draft Financial Audit Report for the County of Hawaii Fiscal Year Ended June 30, 1997 In response to Item C (Public Works Receivable) of the above-captioned report, we submit the following comments to the auditors' recommendations: 1- The Solid Waste Division previously submitted a request for collection services to assist with collecting aged accounts receivable and the proposal is currently in process. 2- The Solid Waste Division endorses the setup of reserves for doubtful accounts that would offset the write-offs of uncollectible accounts. 3- The senior account clerk position that would be responsible for accounts receivable is currently in process to be filled. When this staffing compliment is filled, the pro-active collection measures of daily telephone calls and more persistent follow-up contact with delinquent accounts can be regularly accomplished. Please call this office at 961-8339 if you have any questions regarding these comments. WRL.ms.mem.9734 -11- ~ x<Y O/ M. ~ Donna Fay K. Kiyosaki Chief Engineer itephen K Yamashiro Mayor Jim A. Sumada Deputy Chid Engineer re or x• ~II1tTCf>y1 D~ ~tIfUFlti DEPARTMENT OF PUBLIC WORKS 2S Aupuni Street, Room 202 • Hilo, Hawnii 96720-4252 (808)961-8321 • Fax (808)961-8630 November 25, 1997 TO: Connie Kiriu Legislative Auditor FROM: Peter Boucher, Division Chief Wastewater Division SUBJECT: Current Year's Observations and Recommendations of the Draft Financial Audit Report FY ended June 30, 1997 Thank you for the opportunity to comment on the auditor's report concerning Sewer Accounts Receivable. Recommendation: The Director of Public Works should formalize and enforce credit, billing and collection policies and procedures for the department; consider using a private collection agency to collect on its accounts receivable greater than 90 days; and take a more pro-active approach in its collections. The County may also record an allowance for doubtful accounts and write-off uncollectible balances. The Administration is continuing to negotiate with the Department of Water Supply to handle the billing and collection functions. DWS has planned to hire a consultant to evaluate their whole financial system. At such time as the consultants complete their work and DWS implements their new billing system, it is expected that WWD billing would be integrated with DWS. DWS & WWD personnel will continue to discuss plans for the consolidation. On May 10, 1997, the Administration proposed to amend Chapter 21, Hawaii County Code to authorize the shutoff of water service by the Department of Water Supply to enforce the collection of sewer user fees. However, on June 17, 1997 Bill No. 97-98 was deferred by the Finance Committee pending follow up. In the meantime, the Division is already performing as well as possible with the current staff. The workload is constantly increasing and at this time, we are -12- considerably understaffed. Earlier in the year we initiated a new program to issue our dunning letters prior to sending delinquent accounts to the collection agency. This program, although moderately successful, was discontinued due to lack of staffing. We have requested establishment of an Account Clerk position which hopefully will be filled within the year. A request for proposals which was forwarded to Finance to contract collection services to different private collection agencies is still pending. WWD personnel continues to make follow-up contact with the current collection agency to update the collection account status. Upon confirmation, the Division is able to write off receivable balances deemed uncollectible. The Corporation Counsel recently set up a payment plan agreement for one of the largest collection accounts. Collection efforts are continuing for the other accounts. cc: ADM -13- STATUS OF PRIOR YEARS' OBSERVATIONS AND RECOMMENDATIONS A. WASTEWATER DIVISION BILLING AND COLLECTIONS Observation: The billing and collection functions of the Wastewater Division could be improved by assigning sewer billing and collection responsibilities to the Department of Water Supply. Background: Billing deficiencies: Sixty-nine percent of the Wastewater Division revenues come from commercial accounts that are billed bimonthly. These billings, which average $265,000 for a bimonthly period, are sent out 45-60 days after the end of the service period. Bills have little chance of payment until they are sent out, and the delay increases the cash requirements for the operation of the Division. The delay between the end of the service period and the billing is caused by manpower limitations in processing cash receipts between billing dates. Collection deficiencies: Past due accounts over 120 days from billing have increased from $99,000 as of June 30, 1992 to $168,000 as of June 30, 1993, $256,000 as of June 30, 1994, $390,000 as of June 1995, $352,000 as of June 30, 1996, and $414,870 at June 30, 1997. The reasons for the increase in past due accounts include (a) a lack of accountability with regazd to the collections function, and (b) a lack of significant penalties to customers for non- payment. The current processing of delinquent accounts consists of (a) non-payment notification after 45 days from the billing date, (b) bills being sent to collectors, usually after 105 days, and (c) finally, if the delinquent balances are greater than $200, forwarding of bills to Corporation Counsel. Sewer bills are based on the volume of water usage over a minimum service Fee. If the Department of Water Supply was responsible for sewer billing and collection, the threat of water shut-off would be a powerful incentive for prompt sewer bill payments. This practice is followed by the County of Maui and the City and County of Honolulu. Recommendation: The County Council should consider an ordinance requiring the Department of Water Supply to function as the billing and collecting agent for the County's sewer charges. Current Status: The Administration has continued its efforts to negotiate with the Department of Water Supply to handle such billing and collection functions. Current Recommendation: Continue negotiations with the Department of Water Supply to handle such billing and collection functions. -14- B. DEPARTMENT OF PUBLIC WORKS -GRANT REIMBURSEMENT REQUESTS Observation: The Department of Public Works (DPW) has not submitted grant reimbursement requests on a timely basis. Background: During fiscal 1997, DPW had several reimbursable federal grants, passed through the State of Hawaii for construction and planning of highway projects. DPW can request reimbursement upon payment of qualifying expenditures. In practice, DPW has not consistently requested reimbursement on a timely basis. For example, as of October 25, 1996, DPW had not requested $459,170 of reimbursable costs related to the Alii Drive design project. The costs were incurred between September 1995 and July 1996, with 43% of the costs incurred during 1995. Untimely requests adversely affect the County's cash flow and investment earnings. Recommendation: Submit grant reimbursement requests as soon as qualifying payments exceed apre-determined level; such as $10,000. Current Status: The Department is currently developing a system for processing reimbursement requests on a timely basis and for tracking the status of qualifying payments versus reimbursements. The Department has also increased the frequency of reimbursement requests. C. ADJUSTING COMPUTER SYSTEMS FOR THE YEAR 2000 Recommendation: Implement formal procedures to assess the County's computer systems' capability relating to rollforward into the yeaz 2000. This matter should be a high priority. Current Status: See current year's comment. D. INTERNAL AUDIT FUNCTION Recommendation: Evaluate the costs versus the benefits of establishing an internal audit function. Current Status: The County's Director of Finance is currently evaluating the costs versus the benefits and is in the early stages of developing an internal audit function. See current year's comment. - IS - APPENDIX LONG RANGE SYSTEMS PLANNING The need for an information systems plan was identified by the 1990 and 1991 audits. In 1991, a plan was prepared internally by the County's data processing department. This plan was not accepted by the County Council and asole-source contract was given to an independent contractor to develop a systems plan for the County. A "Long-Range Strategic Information Systems Plan" (Plan) was prepazed for the County in April 1992. The content of this plan is similaz to the plan prepazed for the County of Maui. The Plan does not include all of the analyses necessary for the County of Hawaii to adequately plan its information systems. The systems plan should include the following (see Exhibit I): • Business Model -The purpose of a systems plan is to ensure that the administration allocates system resources and establishes priorities based upon countywide needs. This analysis identifies the organizational mission, objectives, and critical success factors for the County administration. Information systems development efforts should be tied to the County's strategic plans and objectives. Systems must deliver information where it is needed. Therefore, systems development planning must include planning for all areas of the County Administration. The County's Plan does not identify the objectives and critical success factors for the County Administration. • Function Model -For information systems to support the needs of the County, a common understanding of the County's processes must be developed. The function model defines the administration's processes and how they relate to one another. By linking these processes to the objectives and critical success factors, the most important processes can be identified. By linking processes to organizational units, redundant business activities can be identified, and the interaction between organizational units can be determined. The function model is not the same as an organizational model. Organizational boundaries are eliminated and only the functions of the County aze identified. The function model describes the activities performed, whereas an organizational model describes one way of organizing human resources to perform those actions. Because activities performed by the County aze shown only once in the function model, the data and systems to support these activities will only be created once. Redundant data and systems can be avoided and the systems supporting a function model will be much more stable than systems built according to an organization chart. This stability derives from the fact that what an organization does changes much less than how it is organized. Because the Function Model identifies how the County administration operates, it is the foundation for building future information systems. The County's Plan does not provide a function model for the County. -16- • Data Architecture -The data azchitecture is the blueprint for organizing the data needed to support the information requirements of the County. It uses the function model to consolidate and standazdize the process by which data is organized and referenced throughout the County. [n developing the function model, each process is analyzed to determine the information needed to perform that process. Information requirements that are used frequently together aze grouped into subject azeas. Subject azeas aze the ideal structures for logical database organization. The objective is to support the greatest number of processes with the smallest number of databases. The County's Plan does not provide a data architecture for the County. • Application Architecture -The application architecttre defines the integrated, non-redundant set of automated information systems needed to support the County. It facilitates the coordination of a lazge number of system development projects and provides a basis for defining application development projects. The application azchitecture is derived from the processes contained in the function model. Each process that could be supported by automation results in the definition of an application system. The application architecture represents the tazget environment towazd which all future systems development can be directed. No application architecture is provided by the County's Plan. The Plan makes recommendations regardirsg individual applications. Afunctional listing of applications is provided to identify which applications may cross departmental boundaries. • Assessment of Existing Information Systems -The County maintains a significant investment in existing application systems and technology. An inventory and assessment of existing applications, in addition to an inventory of current projects and current databases and fies, helps to determine the strengths and limitations of each. It provides the County with a baseline for future system improvements, including: A profile of existing automated applications systems and an assessment from both a technical and functional perspective. Identification of application systems that aze currently funded and in process. Comparison of the current applications and projects to the desired application azchitecmre to identify gaps and deficiencies. This comparison is called a gap analysis. Profile and assessment of existing technology components (computer systems and networks). Profile of the major databases and files. The County's Plan provides a listing of information systems. However, technical and functional assessment of these systems are not adequately provided. • Project Plan -For strategic planning purposes, the project plan provides the road map for implementation of new systems for the County. Each project must be defined insufficient detail to allow its evaluation based on the criteria such as: Support for County objectives and critical success factors Resource constraints -17- Funding source Risk CostBenefit The identified projects can then be prioritized into high, medium and low priority projects. Projects are not adequately defined or prioritized in the County's Plan. The Plan provides a listing of department and countywide computer objectives and priorities. The departmental list was prioritized by each department from its own perspective. However, the criteria for establishing their priorities is not explained. -18- Exhbit I County of Hawaii Administration Systems Plan Components What is our jobT What are our mission, goals BUSIneSS sad critical su ec ess laetorsT Model What are tho activities we do to accomplish our Mfs:ion, Goalt, and Critical Sueeess Paetors7 Function Model Data Appitcation Architecture Architecture What ayplieations do we need What data do we to support out aetivitiesT need to funetioaT Hoa should they be organizedT How well do our existing systems meot our needsT Assessment of Existing Systems -19- rt n COUNTY OF HAWAII FINANCXAL AUDIT REPORT FOR THE FLSCAL YLAR ENDED JUNE 30, 1997 SECTION II COIvfFREHENSIVEALANUAL Y~TINANCIAL REPORT" ~i t COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiji ai i tai Eiiu~u ~'~3'i2 i:'~~vT t QF. ,4 ~ k~ i COUNTY; OF ~iAWAII Hilo; ~iawaii ' Stephen IE, Yamashixo Mayor William G. Davis Managing Director Prepared by ' The Department of Finance Harry A: Takahashi Director of Finance COUNTY OF HAWAII Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 1997 Table of Contents INTRODUCTORY SECTION Letter of Transmittal 1 GFOA Certificate of Achievement 13 Organization Chart 14 List of Elected Officials 15 List of Principal Officials 16 FINANCIAL SECTION Independent Auditors' Report 17 Glossary of Certain Tenns Used in Financial Statements 18 General Purpose Financial Statements: Combined Balance Sheet -All Fund Types and Account Groups and Discretely Presented Component Unit 20 Combined Statement of Revenues, Expenditures and Changes in Fund Balances -All Governmental Fund Types and Expendable Trust Funds 24 Combined Statement of Revenues, Expenditures, and Changes in Fund Balances -Non-GAAP Budgetary Basis -General and Special Revenue Fund Types 26 Combined Statement of Revenues, Expenses and Changes in Retained Earnings -Proprietary Fund Type and Discretely Presented Component Unit 28 Combined Statement of Cash Flows -Increase in Cash and Cash Equivalents -Proprietary Fund Type and Discretely Presented Component Unit 29 Notes to the Combined Financial Statements 31 Supplemental Information: General Fund: Comparative Balance Sheets 63 Comparative Statements of Revenues, Expenditures and Changes in Fund Balances 65 Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAP Budgetary Basis 66 FINANCIAL SECTION (Continued) Pace. Supplemental Information (continued): Special Revenue Funds: Combining Balance Sheet 72 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 74 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances -Non-GAAP Budgetary Basis 76 Highway Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 79 Parking Meter Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 80 Sewer Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 81 Bikeway Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 82 Cemetery Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 83 Vehicle Disposal Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 84 Solid Waste Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 85 Golf Course Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 86 Geothermal Royalty Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 87 Beautification Fund -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetazy Basis 88 Debt Service Funds: Combining Balance Sheet 89 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 90 Capital Projects Funds: Combining Balance Sheet 91 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 92 Capital Projects Fund -Schedule of Appropriations, Expenditures and Encumbrances -Non-GAAP Budgetary Basis 93 [ I FINANCIAL SECTION (Continued) Supplemental Information (continued): P3g~ Enterprise Funds: Combining Balance Sheet ~ Combining Statement of Revenues, Expenses and Changes in Retained Earnings 101 Combining Statement of Cash Flows 102 Trust and Agency Funds: Combining Balance Sheet 104 Expendable Trust Funds -Combining Statement of Revenues, Expenditures and Changes in Fund Balances 106 Hawaii County Housing Agency -Schedule of Revenues, Expenditures and Changes in Fund Balance -Non-GAAP Budgetary Basis 107 Agency Funds -Combining Statement of Changes in Assets and Liabilities 108 General Long-Term Debt Account Group: Schedule of General Long-Term Debt 113 Schedule of Debt Service Requirements to Maturity for General Obligation Bonds 114 General Fixed Assets Account Group: Schedule of General Fixed Assets by Source 115 Schedule of Changes in General Fixed Assets by Function 116 Schedule of General Fixed Assets by Function and Activity 117 STATISTICAL SECTION Table 1 -General Governmental Expenditures by Function 119 Table 2 -General Governmental Revenues by Source 120 Table 2a -General Governmental Tax Revenues by Source 121 Table 3 -Property Tax Levies and Collections 122 Table 4 -Assessed and Estlmated Actual Value of Taxable Real Propery 123 Table 5 -Real Property Assessed Values by Classification and Tax Rates 124 Table 6 -Principal Taxpayers 128 Table 7 -Computation of Legal Debt Margin 129 Table 8 - Ratio of Net Bonded Debt to Assessed Value and Net Bonded Debt Per Capita 130 STATISTICAL SECTION (Continued) Pa>;~. Table 9 -Ratio of Annual Debt Service Expenditures for General Obligation Bonded Debt to Total General Governmental Expenditures 131 Table 10 -Demographic Statistics 132 Table 11 -Property Value, Construction and Bank Deposits 133 Table 12 -Miscellaneous Statistical Data 134 INTRODUCTCORY SECTIOI~T a ON~{Y OF O.• ,1~ Stephen K. Yamashiro ~ Harry A. Takahashi ~i~~:-~. 7TF Vi.N'tIt ~IIltl'C~~ II~ ~FS~lTFI1t DEPARTMENT OF FINANCE 25 Aupuni Street, Room IIB Hilo, Hawaii 967204252 (808) 96I~8234 Fax (808) 961-8248 October 27, 1997 The Honorable Mayor and Members of the Council County of Hawaii 25 Aupuni Street Hilo, Hawaii 96720 We transmit herewith [he Comprehensive Annual Financial Report for the County of Hawaii, State of Hawaii, for the fiscal year July I, 1996 to June 30, 1997. This report was prepared by the County's Department of Finance. The accuracy of the financial statemenu and the completeness and fairness of their presentation are the responsibility of the County government. We believe the enclosed data aze complete and accurate in all material respects and are reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the County. All disclosures necessary to convey the maximum understanding of the County's financial activities have been included. This report presents the financial position of the County of Hawaii at June 30, 1997 and results of operations for the fiscal year then ended. The report is divided into three sections: • The Introductory Section includes this transmittal letter, a Certificate of Achievement for Excellence in Financial Reporting, the County of Hawaii's organization chart and lists of elected and principal officials. • The Financial Section contains the general purpose financial statements, related notes, the combining and individual fund and account group financial statements and schedules, and the independent auditors' report. • The Statistical Section includes selected financial and demographic information, generally presented on a multi-year basis. This report includes all funds and account groups of the County of Hawaii, including its component unit, the Department of Water Supply, established by the County Charter as a semi- autonomous body of the County government. This component unit is included in the County's reporting entity because of its financial relationship with the County. The County provides the full range of municipal services. These include police and fire protection; emergency medical care; public prosecutor, culture and recreation; sanitation; social services; water, planning and zoning; construction and maintenance of highways, streets and infrastnlcture; real property assessment and tax collection; and general administrative services. -1- However, the County does not provide such other traditional services as public education, hospitals and courts. These services are provided by the State government. The County of Hawaii consists of the island of Hawaii, 4,038 squaze miles in size. It is twice as large as the combined area of all the other inhabited islands in the Hawaiian Archipelago. Since there is no other local or municipal government within the County, there are no overlapping taxes and no overlapping debt. Hawaii County has an elected mayor and arsine-member council. Economic Condition and Outlook The County of Hawaii has been weathering some tough economic times in recent years with the decline in tourism and the exit of the sugar industry fmm the island. However, there are indications that the worst is over and that the economy is showing signs of recovery. in 1996, the County led the state in the creation of jobs as demonstrated by a 1.7% growth in payroll. The 1996 unemployment rate of 9.9% decreased to 9.4% during the first six months of 1997. Tourism is picking up in west Hawaii, as diversified agriculture moves in to replace sugar monoculture in east Hawaii. The city of Hilo on the east side of the island serves as the county seat and the financial center for the County. Hilo's infras[rucmre includes Hilo Harbor, a deep water port, and Hilo International Airport, which is capable of handling fully-loaded wide body aircraft. While the sunny west side of the island is growing more rapidly than the Hilo side, the east side is still home to the bulk of the County's population. The west side is more dependent on the visitor industry. I[ is home to a number of major hotels and resorts. Kona's Keahole Airport can accommodate direct flights from mainland and foreign markets. The Hawaii County Profiles supplement to the July/August 1997 issue of First Hawaiian Bank's bimonthly newsletter, Economic Indicators, is the source for most of the economic information in this section. Tourism Daily direct flights from the U.S. mainland, thrice weekly direct flights from Japan, and direct Canadian service to Kona's Keahole Airport have resulted in record high occupancy levels for west Hawaii hotels and resorts. Occupancy rates for the high-end Kohala resorts average 79% for the first six months of 1997, up from 68% in 1996 and 61% in 1995. The new Four Seasons Hualalai opened in September of 1996, with 380 rooms and over 600 employees. Other major hotels along the Kohala coast have spent over $100 million recently in renovations. Technology The new 50-bed North Hawaii Community Hospital opened in June of 1996, and has begun attracting doctors to practice in the Waimea area. The Five Mountain Medical Community, founded last year, is working to take advantage of the County's central location in the Pacific region and make Waimea an international destination for medicine, health, and healing. The astronomy industry continues to grow as organizations take advantage of the excellent conditions at the peak of Mauna Kea for astronomical observations. The Research Technology Park affiliated with the University of Hawaii at Hilo is the site of a growing number of base -2- facilities for the observatories. Most recently, the Gemini North Telescope Base Facility had its groundbreaking ceremony in June, 1997. The Natural Energy Lab in west Hawaii posted an 8% rise in tenants and a 30% increase in land leased over the last year. Its most successful tenant is Cyanotech, the world's lazgest producer of spinrlena, an algae-based nutritional product. The firm is now preparing to produce another microalgae product, astaxanthin, that is used as a red pigment in salmon aquaculture. Agriculture The size and diversity of climates in the County make the land well suited to many types of crops. Macadamia nuts and Kona coffee are the County's most well-known exports. Other crops that are growing in importance include avocado, guava, banana, papaya, and various exotic tropical fruits like rambutan, lychee, and mangosteen. Flowers, foliage and nursery crops are also of economic importance. In 1996, the agricultural work force in the County increased by an estimated 150 positions. Large tracts of land in the Hamakua area are also being considered for forestry. Major Initiatives For the Year During the year, the County focused on fiscal management, economic development and tourism, public works, public safety, and other issues affecting the quality of life in the County. Fiscal management -The County again ended the year in excellent financial condition in spite of private sector economic difficulties and a shrinking real property tax base. The ongoing fiscal restraints initiated by the present administration have enabled the County to end the year with a record $21.1 million unreserved fund balance in the general fund. Hilo services -The County is in the final stages of the acquisition of a former retail site across the street from the existing County Building. Plans are being made to utilize the 70,000 square foot facility for county offices. Research and development -Through the Department of Research and Development, the County supported major sporting events that brought many visitors and favorable publicity to the County. Examples of well-known activities supported include the Ironman Triathlon World Championship, the International Billfish Tournament, the Senior Skins Gold Tournament, and the MasterCard Senior PGA Tournament. Since the enabling legislation was passed, five enterprise zones have been established in the County. Qualified businesses in these areas may obtain real property and income tax benefits. The Cotmty has established a Big Island Film Office headed by a film coordinator working to promote the island as a site for the film industry. Film crews from all over the world contributed over $5 million to the County's economy during the year. The County's energy coordinator successfully completed the implementation of a $500,000 energy retrofit of the Hawaii County Building in Hilo through a performance contract. This is the first performance contract ever executed at the state or county government level in Hawaii. -3- This project resulted in the upgrade of the entire lighting system of the building as well as the replacement of 30-year-old air conditioning equipment. The savings in energy costs will fully offset the cost of the improvements over the ten years of the contract, and the County will continue to receive these savings after the initial ten years. Public works -The County completed eight major road projects valued at over $1.3 million during the year. Also completed was the multiyeaz Alenaio Flood Control Project, a joint effort of the County, state, and the Army Corps of Engineers. A pilot program was established to dispose of approximately 2,500 abandoned vehicles in ten private subdivisions. The Vehicle Disposal Fund subsidized operations for abandoned vehicle disposal, battery disposal, fire cutting, and used oil recovery programs. Recycling efforts were expanded through a glass recycling contract, pilot composting contract, household hazardous waste collection, and continuation of diversion grant subsidies. Public srt/ery -The police depamnent continued its commitment to ridding the community of illicit drugs. In 1996, police drug enforcement efforts included the eradication of 139,336 marijuana plants and the seizure of 41.7 pounds of processed marijuana, 4.96 pounds of cocaine, 3.87 ounces of crystal methamphetamine, and 4.04 ounces of heroin. Through the Community Development Block Grant program, the volunteer fire stations in Pepeekeo and Hawaiian Ocean View Es[ates obtained new fire trucks. The use of volunteer fire stations in rural areas to supplement regular County forces continues to grow, enabling country districts to have improved protection and lower fire insurance rates. The Milolii Volunteer Fire Company was certified and is now in operation. The new Pepeekeo Volunteer Fire Station was dedicated in January, 1997. Also dedicated during the year was the Keauhou Fire Station in Kona, and ground was broken for a fire station in Waikoloa. The police Positive Alternative Gang Education (P.A.G.E.) program reached 1,700 junior high school students during the year. The primary focus is to encourage positive alternative behavior for youths at risk and divert them from the hidden dangers associated with gangs. P.A.G.E, uses a combination of classroom curriculum and community service projects to encourage youth to make the right choices in their lives. The Neighborhood Watch program was expanded by the addition of 29 new watches, bringing the total to 132 communities involved throughout the County. The long-awaited Ka'u Police Station was finally completed with CDBG funding. Parks and recreation -Continuing its partnership with the community, several park improvements were completed with the help of volunteers and were placed in service during the year. Parks were dedicated in Hawaiian Ocean View Estates and Waikoloa, and a new playground at Waiakeawaena School was developed with the help of the PTSA. The rodeo arena in Honokaa was renovated with manpower support from four equestrian groups in the area. After it was destroyed in a fire, the Japanese Tea House in Liliuokalani Park in Hilo was rebuilt with funds raised through private donations. A new 50-meter swimming pool in Pahoa was completed and dedicated. Over 600 youngsters tamed out for the first day of swimming, and attendance has remained at that high level. -4- For the future Hilo services -The County is in the process of planning for the renovation of the former retail building across the street from the existing County Building. County agencies now scattered around town in rented space will be consolidated into the new facility, making access to County services easier for citizens. Performance contract- With the successful execution of the performance contract for the energy retrofit of the County Building, work will be continued to convert other County facilities in the future. Parks and recreation -Anew Olympic swimming pool is planned for Kailua in Kona, with construction to begin in the new year. Improved park facilities at Greenwell Park, Higashihara Park and Waimea Park aze the goal of new public-private ventures between the County and community volunteer groups. In response to community needs, a new restroom is being planned for the Hilo Bayfront soccer field area. Highways - An emergency access road linking lower and upper Puna is expected to be completed in the near future. The resurfacing of the final segment of Saddle Road from Hilo is in the planning stages and should be completed in early 1998. Financial Information The management of the County is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the County are protected from loss, theft or misuse and to ensure that adequate accounting data are compiled to allow for preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. Budgetary Control The County maintains budgetary controls to ensure that legal provisions of the annual budget are complied with and that expenditures do not exceed budgeted amounts. Activities of the general fund, special revenue funds, and one expendable trust fund are included in the annual appropriated operating budget. Project-length financial plans are adopted for the capital projects fund. Budgetary control is established at the department level. Formal budgetary integration is employed as a management control device for the general fund, special revenue funds, one expendable trust fund, and the capital projects fund. Budgetary control for the debt service fund is achieved through general obligation bond indenture provisions. The basis of accounting used for the budgets of the general and special revenue funds differs from generally accepted accounting principles. Intergovernmental revenues are recognized when awarded by the granting agency, encumbrances and unexpended allotments are treated as -5- } ` f expenditures for purposes of determining legal compliance with the annual budget, all leases are I treated as operating leases, and accounts payable are not accrued. The County also maintains an encumbrance accounting system as one technique of I accomplishing budgetary control. Encumbrances outstanding at fiscal year end are reported as reservations of fund balances and do not constitute expenditures or liabilities because they will be honored during the following year. As demonstrated by the statements and schedules included in the financial section of this report, the County continues to meet its responsibility for sound financial management. General Government Functions The following is a summary of operations for the fiscal year ended June 30, 1997, including the general fund, special revenue funds, and debt service fund. Revenues -Revenues in fiscal 1997 totaled $153,928,329, a 1.6% decrease from the previous year. The amounts of revenues from the various sources and changes from last year follow: — Increase Percent of Percent (Decrease) Increase Source Amount of Total From 1996 (Decrease) Taxes and assessments $96,124,132 62.4% ($5,630,857) (5.5%) 11 Licenses and permits 6,123,507 4.0 287,425 4.9 Intergovernmental 36,016,534 23.4 2,360,315 7.0 Charges for services 7,795,835 5.1 (236,255) (2.9) Fines and forfeitures 346,436 0.2 (319,043) (47.9) Interest and penalties 5,859,532 3.8 1,167,859 24.9 Miscellaneous 1,662,353 1.1 (171,824) (9.4) Total $153,928.329 100.0% ($:2_5242310.) Licenses 4% Taxes 63% : Intergovernmental ? 23/ ^:C KCL- ..i ri:'i:r:'iiiji:i$:4?'}•.v! {:}: •�� •.:{/ ..}..:?}::•: v:S�}iii�?:{::5.}r. ::>:3sY x-. :i??v?:iii^:?i�i:�:�.} Y\::{:i:•Xa::}}:4 :�vtS iiiY:^::•.:. .:-.{;!.}{:ji? `•.}:•}:{.a.4v-.v _Ti:....A..::•:.�:::.:........... •i'Y-:vv��}} Z:};?:ilii}ii}?:2^ii ii:i?'}ji:iY{:pyv;••y: �:\::.�° .. :r.,c-::{;::;;:,.,4.?Y{;3i:}iFii::i i:ciiii;::<% ::.'•}{{:.,;{fty:i::?:iiYR:r::i: ....; .. l }..j}:tia?ivT <ai`v::?i i�•Yi .i..• i�Y;Y l$•vri'f,.\:::i is}: tv�scellaneous 1% Interest/penalties 4% Charges for services 5% 1997 Revenues by Source - 6 - Miscellaneous Interest &penalties '` 14 Fines and forfeitures Charges for services • Intergovernmental '' Licenses &permits Taxes 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o a o N UJ CO O N ❑1997 ■1996 r 65000) Comparison of Revenues by Source m FY 1996 and 1997 The County's largest single source of revenues, taxes and assessments, showed a decline during the year and contributed 62.4% of the total revenues. Taxes and assessments are a combination of three distinct resources: real property, fuel, and franchise taxes. Real property tax revenues were $6.0 million less than the prior fiscal year, and accounted for the decrease during the year. Assessments are based on 100% of fair market value, and reflect declining property values county-wide. Tax rates remained unchanged from the prior year. Interest and penalties increased 24.9% to $5,859,532 due to a high cash balance and stable interest rates during the year. -7 - iimilli 0 111 Expenditures -Expenditures for general government purposes in the fiscal year ended June 30, 1997 totaled $153,420,337, an increase of 9.4% over the preceding period. The amounts of expenditure by major functions and changes from last year follow: Increase Percent of Percent (Decrease) Increase Function Amount of Total From 1996 (Decrease) Public safety $ 54,389,640 35.4% $4,048,260 8.0% General government 19,618,111 12.8 1,377,058 7.5 Highways and streets 6,983,448 4.6 746,893 12.0 Sanitation 11,717,022 7.6 1,266,306 12.1 Health,education, welfare 5,006,902 3.3 (203,646) (3.9) Culture and recreation 11,461,850 7.5 377,314 3.4 Pension and retirement contributions 14,295,447 9.3 969,439 7.3 Health fund 8,687,847 5.7 436,843 5.3 Miscellaneous 2,946,618 1.9 (294,422) (9.1) Capital outlay 4,458,536 2.9 2,709,743 154.9 Debt service 13,854,916 9.0 1,800,618 14.9 Total $153,420,337 100.0% $13,194,406 Capital outlay 3% Miscellaneous 2% Debt service 9% Health fund 6% nsions 9°/O .......z. O :s:r Public Safety 35/° Culture/ret 7° r f` :,;f,:„......,:;: n ral "' Gee 9 O govt. ° 4G\:T"iiiiiiii:::?2:Ci:v;ii:i-:.• ri:S i:•iiiii:iii:C:ii}:.iilij:i: :iJiiiiiiii:Jii:!?J:^i:!y:;:ii ii:;{:iiiiiY4:v:ii HEW 3% i:::'ri :>.:::+:::.1i i::::tii:is}:::ii :..ilii .--: •:-.i ......:ii iii Sanitation 8% Highways& streets 5% 1997 Expenditures by Function - 8 - Debt service Capital outlay Misc r Health fund Pension/retire Culture & recreation HEW ' Sanitation t Highways &streets PP' General govt .•.... _.....:. - �- Ili tsw Public safety r 0b 0 0 0 0o. 0 o 0 0 0 0 N co') O (00 ($000) PI 01997 ®1996 i PComparison of Expenditures by Function - FY 1996 and 1997 Salaries and wages for all functions increased during the year due to collective bargaining pay increases for six out of seven bargaining units. The expenditure for capital outlay increased $2.7 million from 1996 for a 154.9% increase. The amount went up due to the expenditure of$3.4 million in federal Community Development I Block Grant funds as the County works to expend grant funds within allowable time constraints. i Debt service expenditures increased by 14.9% as payments on the 1996 Series A general obligation bond issue began during the year. IGeneral Fund Balance 'The unreserved fund balance for the general fund amounted to $21.1 million at June 30, 1997. Of this amount, $17.1 million was designated for various purposes, including $15.8 million that was projected and anticipated as revenue to finance the ensuing fiscal year 1998 operating budget. The balance of$4.0 million was unreserved and undesignated. IEnterprise Operations Kulaimano Elderly Housing Project-The operating revenue of this fund totaled $237,326 during the fiscal year, a decrease of$6,064 from the prior year. Operating expenses were $148,490, down from $184,775 last year. Interest paid on long-term debt exceeded interest 1 earned on investments by $49,697. Net income for this fiscal year was $39,139. - 9 - 1 Ouli Ekahi Affordable Housing Project -During its first full fiscal year of operation, the operating revenue of this new fund was $190,911. Afrer operating expenses of $199,245 and interest income of $1,322, the net loss for the year was $7,012. Component Unit -Department of Water Supply Water sales totaled $17,778,109, an increase of $1,972,718 over the prior year. Operating expenses of $17,910,184 are $118,695 higher than last year, resulting in an operating loss of $132,075. Nonoperating revenues (primarily interest earnings) net of nonoperating expenses (primarily interest expense) totaled $240,217, resulting in net income of $108,142. Pension Plan All full-time employees of the County participate in the Employees' Retirement System of the State of Hawaii, acost-sharing, multiple-employer public employee retirement system. Debt Administration The County issued general obligation bonds to agencies of the federal government in the amount of $4,772,500 during the year. The proceeds were used to purchase a former retail site near the present County Building for the expansion and consolidation of County services, and to assist in construction of the Papaikou sewer system. The County has drawn down on eleven loans from the State Water Pollution Control Revolving Fund to finance wastewater projects in Hilo and Kona. The cash which the County had borrowed at June 30, 1997 (net of repayments) totaled $29,033,331. The total debt outstanding at June 30, 1997 was $169,146,562 (including debt of the enterprise fund and the wmponent unit). Under current State statutes, the County's general obligation bonded debt issuances are subject to a legal limitation of 15% of total assessed value of real property. As of June 30, 1997, the County's net general obligation bonded debt of $141,144,771 was well below the legal limit of $1,541,886,017. Cash Management Cash temporarily idle during the year was invested in demand deposits, certificates of deposit and repurchase agreements. The average yield on investment was 5.00%. The County's policy is to minimize credit and market risks while maintaining a competitive yield on its portfolio. Accordingly, deposits were either insured by federal depository insurance or collateralized. All collateral on deposits was held for safe keeping with aCounty-designated agent. Risk Management The County maintains insurance coverage for privately owned police vehicles as well as for other purposes. The County is substantially self-insured for its vehicles as well as for all other perils including workers' compensation and general liability. -10- Other Information Privatization In 1993, the County contracted with a private company to construct and operate a new municipal solid waste landfill on the west side of the island. This contract was challenged in court by a public employee union. The County prevailed through the Circuit Court level, but the union appealed to the Hawaii Supreme Court. In February of this year, the Supreme Court finally rendered a decision in favor of the union. This decision voided the contract with the private company, and stated that under current state law, jobs of a type that have been "customarily and historically" perforated by civil servants cannot be contracted out, or "privatized." The landfill situation is nearly resolved, with acourt-approved plan whereby the daily operation of the landfill will be performed by County employees but all construction work on the landfill cells will continue to be perforated by the private company. Under this tentative agreement, the County will continue to have no responsibility for remediation, closure or postclosure care for the landfill. However, the impact of this Supreme Court decision reaches far beyond the landfill, to all of the other services that the County has contracted out to private individuals and companies. For example, the legality of contracts for services such as janitorial and grounds maintenance at the various public facilities throughout the County are now in question. With the cooperation of the court, a review process has been established to examine every service contract that the County has to determine if it involves work that has "customarily and historically" been performed by civil servants. If a number of the private contracts are legally voided, the County may have to hire additional civil service personnel to perform the necessary services, which will result in a higher cost to the County. The financial impact of this decision cannot be estimated a[ this time. Independent Audit The Hawaii County Charter requires an annual audit by independent certified public accountants. Deloitte & Touche LLP was selected by the County Council to perfortt the audit. Employee Union Contracts County employees are members of seven different bargaining units. Five bargaining units have contracts which expired June 30, 1997. One bargaining unit has a contract which expires June 30, 1999, and one has a contract which expired June 30, 1995 and was extended to June 30, 1996. Certificate of Achievement The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the County of Hawaii for its comprehensive annual financial report for the fiscal year ended June 30, 1996. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standazds for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized comprehensive annual financial report, whose contents -11- conform to program standards. Such CAFR must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to conform to the Certificate of Achievement program requirements, and we aze submitting it to GFOA. Acknowledgments The preparation of this report on a timely basis was made possible by the efficient and dedicated services of the entire staff of the Departrnent of Finance and fiscal personnel in other departments. I am grateful for their help in preparing this report. I also thank the Mayor and the members of the County Council for their interest and support in assuring the continuing sound financial condition of the County of Hawaii. HARRY A~TAKAHASHI Director of Finance -12- Certificate of Achievement for Excellence in Financial Reporting Presented to County of Hawaii For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 1996 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. W NR06G1 T9a l i GN Gi ~ ~ F Preside f~fQ~~~ anca ~ 1 / C~ Uf/ Fxecutive0`D.irector -13- County of Hawaii Organization Chart County Electorate County Council Mayor Prosecuting Attorney County Clerk Office of the Mavor: Managing Director Safety Coordinator Departments and agencies Agencies under Departrnents under under direct supervision administrative supervision commissions and of the Mayorand/or of the Mayor: administrative supervision Managing Director: of the Mayor: Civil Defense Corporation Counsel Office of Aging Civil Service Finance Police Planning Liquor Control Research & Development Housing & Community Public Works Development Parks & Recreation Water Supply Fire Department (semi-autonomous) Mass Transportation -14- County of Hawaii Elected Officials Administrative Officers (Term: 1996-2000) Stephen K. Yamashiro Mayor Jay T. Kimura Prosecuting Attorney Countv Council (Term: 1996-1998) James Y. Arakaki Chair Al Smith Vice Chair Aaron S.Y. Chung Member Bobby Jean Leithead-Todd Member John Ray Member Joseph Reynolds Member John Santangelo, Jr. Member J. Curtis Tyler, III Member Dominic Yagong Member -15- Principal Officials June 30, 1997 County Clerk Donald Ikeda Legislative Auditor Connie Kiriu Managing Drrector William G. Davis Deputy Managing Director Henry Cho Corporation Counsel Richazd Wurdeman Director of Finance Harry A. Takahashi Planning Director Virginia Goldstein Director of Personnel Michael R. Ben Drector of Research and Development Diane Quitiquit Chief of Police Wayne Carvalho Fire Chief Nelson Tsuji Chief Engineer Donna Fay K. Kiyosaki Director of Pazks and Recreation George Yoshida Manager, Department of Water Supply Milton Pavao Civil Defense Administrator Harry Kim Director of Liquor Control Janice A. Pakele Transit Operations Administrator Michael Cochran Executive on Aging William T. Takaba Assistant Administrator, Office of Housing and Community Development Edwin S. Taira Safety Coordinator Jay Sasan -16- ~ . A i FINANCIAL SECTIpN I j Deloitte & Touche «P Suite 1200 Telephone: (808) 543-0700 ~ 1132 Bishop Street Facsimile: (808) 526-0225 Honolulu, Hawaii 96813-2870 INDEPENDENT AUDITORS' REPORT To the Members of the County Council County of Hawaii Hilo, Hawaii We have audited the accompanying general purpose financial statements of the County of Hawaii, State of Hawaii, as of June 30, 1997, and for [he yeaz then ended, listed in [he foregoing table of contents. These general purpose financial statements aze the responsibility of the management of the County. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standazds and Government Auditing Standards, issued by the Comptroller General of the United States. Those standads require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements aze free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing [he accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, such general purpose financial statements present fairly, in all material respects, the financial position of the County, at June 30, 1997, and the results of its operations and the cash flows of its proprietary fund type and of its discretely presented component unit for the yeaz then ended in conformity with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining and individual fund and account group financial statements and schedules listed in the foregoing table of contents aze presented for purposes of additional analysis and aze not a required part of the general purpose financial statements of the County. These financial statements and schedules aze also the responsibility of the management of [he County. Such additional information has been subjected to the auditing procedures applied in our audit of [he general purpose financial statements and, in our opinion, is fairly presented in all material respects when considered in relation to the general purpose financial statements taken as a whole. The statistical section listed in the foregoing table of contents is presented for purposes of additional analysis and is not a required par[ of the general purpose financial statements of the County. This additional information is the responsibility of the management of the County. Such additional information has not been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, accordingly, we express no opinion on it. In accordance with Government Auditing Standards, we have also issued a report dated October 27, 1997 on our consideration of the County's internal control structure and on its compliance with laws and regulations. ~~l.t~ t ove.Q.e_LL~ October 27, 1997 DeloitteTouche Tohmatsu - 17 - Il~ernational GLOSSARY OF CERTAIN TERMS USED IN FINANCIAL STATEMENTS The following is a glossary of certain terms associated with financial statements: Fund - An independent fiscal and accounting entity with aself-balancing set of accounts recording cash and/or other resources together with all related liabilities, obligations, reserves and equities which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions or limitations. Appropriations -Authorizations granted by a legislative body to make expenditures and to incur obligations for specific purposes. An appropriation is usually limited in amount and as to the time when it may be expended. Encumbrances -Obligations in the forth of purchase orders, contracts or other commitments which are chargeable to an appropriation and for which a part of the appropriation is reserved. Encumbrances cease to exist when the related expenditure is recorded. Unexpended Allotments -Reservations of capital project appropriations that are available [o complete such projects in future fiscal periods. Expenditures -Cost of goods delivered or services rendered, whether paid or unpaid, including expenses and capital outlays. Expenditures are distinguished from encumbrances in that expenditures relate to goods delivered or services rendered whereas encumbrances represent commitments or obligations for goods to be delivered or services to be rendered and for which no actual liability has been incurred. Lapses - As applied to appropriations, the term denotes the automatic termination of an appropriation. Except for continuing or indeterminate appropriations, an appropriation is made for a certain period of time. At the end of this period, any unexpended or unencumbered balance thereof is returned to fund balance, unless otherwise provided bylaw. -18- GENERAL PURPOSE FINANCIAL STATEMENTS -19- COUNTY OF HAWAII Combined Balance Sheet All Fund Types and Account Groups and Discretely Presented Component Unit June 30, 1997 (}kith comparative [oLC for Tune 30- 19961 Proprietary Governmental Fund Types Fund Type Special Debt Capital n r l 12evenue Service Prnl fIS F.lltcattis,i Acc tc and O her Debitc Cash and investments (note 3): Cash and cash equivalents $15,040,738 $ 9,638,535 $ 1,061,345 $ 3,699,158 $ 381,516 Investments 12,533,048 18,126,256 37,500,000 500,000 Imprest and change funds 25,070 2,000 150 Receivables, net of allowance for doubtful accounts: Trade 1,842,368 7,706 Real property taxes 13,003,368 Due from other governments 9,121,102 5,241 3,550,833 Due from other funds (note 4) 2,098,088 488,738 571,792 Other 220,369 99,804 2,015 2,301 Inventories 1,980,213 Prepaid expenses 2,417 Restricted assets (note 3): Cash and cash equivalents 218,519 227,041 Investments Property and rights held under deferred compensation plan Fixed assets, net of accumulated depreciation where applicable (note 5 and 16) 1,603,703 Deferred charges Amount available ut debt service funds Amount to be provided for retirement of general long-term debt Total assets and other debits $54,0~21.9~96 $12,0~76~ $19,1 $45,542,317 $2,7 See accompanying notes to combined financial statements. -20- Totals Fiduciary (Memorandum Component Totals Fund Types Account Groups Only) Unit (Memorandum Only) General Depaztmen[ Reporting Trus[ and Long-Term General Primary of Entity Aeencv pehl Fixed Assets mernment Water Suooly ,[floe 30. 1997 June 30. 1996 $8,546,194 $ $ $ 38,367,486 $ 166,382 $ 38,533,868 $ 30,993,927 1,199,325 69,858,629 15,471,315 85,329,944 111,272,505 100 27,320 12,431 39,751 35,794 1,850,074 1,779,845 3,629,919 3,919,535 13,003,368 13,003,368 13,897,900 51,995 12,729,171 12,729,171 5,991,616 3,930,268 7,088,886 7,088,886 5,290,350 81,106 405,601 192,618 598,219 1,260,476 1,980,213 502,185 2,482,398 1,988,649 2,417 15,310 17,727 9,993 1,400,000 1,845,560 1,845,560 2,288,190 10,753,221 10,753,221 12,404,810 26,576,092 26,576,092 26,576,092 22,354,503 281,938,486 283,542,189 138,386,365 421,928,554 398,197,684 4,759,634 4,759,634 4,342,502 18,429,799 18,429,799 18,429,799 18,351,883 175,530,474 175,530,474 175,530,474 162,968,131 $41,7~c $193,960,273 $281 $651,x® 37~ $172,039,306 $823~276,585~ $795,568,448 (Continued) -21 COUNTY OF HAWAII Combined Balance Sheet All Fund Types and Account Groups and Discretely Presented Component Unit June 30, 1997 (With comoara iy to als for J me 30. 19961 Proprietary Governmental Fund Types Fund Type Special Debt Capital n r l Revenue $S<IY1Gg P[9JY&[S F,llICIpLS@ 1 iabilitiee Egnity and Other Credits Liabilities: Warrants payable $ 2,872,609 $ 729,611 $ $ 1,026,217 $ 16,451 Accounts payable 1,258,569 470,240 553,712 1,944 Due to other funds (note 4) 4,259,591 1,390,570 102 Due to federal government - azbitrage rebate 136,026 Accrued liabilities 477,678 11,022 Customer advances and deposits Customer deposits payable from restricted assets 23,421 Deferred revenue (note 6) 14,466,153 1,989,483 188,267 530 Bonds payable (notes 9 and 16) Loans payable 1,171,731 Other general long-term debt (notes 7, 8, 9 and 14) Assets held far the benefit of improvement districts Other 689,977 171,466 Deferred compensation benefits payable Totalliabilities 23,682,925 4,579,904 477,678 1,939,764 1,225,099 Equity and other credits: Investments in general fixed assets Contributed capital (notes 10 and 16) 955,663 Retained earnings (note 12): Reserved 161,207 Unreserved 382,871 Fund balances (note 12): Reserved 9,164,621 1,214,697 18,709,923 22,690,159 Unreserved: Designated 17,146,707 4,172,027 6,168,412 Undesignated 4,027,743 2,110,058 14,743,982 Total equity and other credits 30,339,071 7,496,782 18,709,923 43,602,553 1,499,741 TotalliabiG[ies,equityandothercredits $54,021,996 $12,076,686 $19,187,601 $45,542,317 $2,724,840 ~ See accompanying notes to combined financial statements. _22_ (Concluded) Totals Fiduciary (Memorandum Component To[als Fund Types Account Groups Only) Unit (Memorandum Only) General Department Reporting Trust and Long-Term General Primary of Entity Aeencv j2eitl Fixed Assets t;ovemment Water Sunoly 1 m . 0. 1997 Lune 30. 1996 $ 1,485,649 $ $ $ 6,130,537 $ 696,383 $ 6,826,920 $ 7,757,767 13,269 2,297,734 846,744 3,144,478 4,610,120 1,438,623 7,088,886 7,088,886 5,290,350 136,026 136,026 10,596 1,820,249 2,308,949 1,673,784 3,982,733 2,414,222 58,609 58,609 179,947 238,556 258,238 23,421 8,470,044 8,493,465 7,188,219 16,644,433 16,644,433 17,757,639 125,414,000 125,414,000 13,527,500 138,941,500 139,695,000 1,171,731 1,171,731 1,409,432 68,546,273 68,546,273 68,546,273 55,997,014 5,100,071 5,100,071 5,100,071 5,499,534 861,443 861,443 3,974,351 26,576,092 26,576,092 26,576,092 22,354,503 36,492,562 193,960,273 262,358,205 25,394,402 287,752,607 274,216,985 281,938,486 281,938,486 281,938,486 263,928,452 955,663 106,999,817 107,955,480 107,033,633 161,207 2,283,177 2,444,384 5,399,246 382,871 37,361,910 37,744,781 31,115,325 2,282,938 54,062,338 54,062,338 70,042,708 61,747 27,548,893 27,548,893 17,593,480 2,947,833 23,829,616 23,829,616 26,238,619 5,292,518 281,938,486 388,879,074 146,644,904 535,523,978 521,351,463 $41,785,,080 $193,960,273 $281,938,486 $651,237,279 $172 03®3~ $823,276,585 $795,568,448 -23- COUNTY OF HAWAII Combined Statement of Revenues, Expenditures and Changes in Fund Balances All Governmental Fund Types and Expendable Trust Funds For the Fiscal Year Ended June 30, 1997 (With comparative to alc for th fic I y r .nd d J m 30. 19961 Governmental Fund Types Special Debt Capital n r l Revenue S rvi I'rQies~ Revenues: Taxes and assessments $86,489,656 $9,634,476 $ $ Licenses and permits 3,150,742 2,972,765 Intergovernmental 35,616,526 400,008 7,691,536 Charges for current services 1,698,830 6,097,005 Fines and forfeitures 346,436 Rents 83,808 Interest and penalties 4,920,177 939,355 11,035 Miscellaneous 1,304,017 274,528 210,018 Total revenues 133,610,192 19,378,782 939,355 7,912,589 Expenditures: Current. General government 19,615,104 3,007 6,612,542 Public safety 51,569,478 2,820,162 2,662,597 Highways and streets 1,293,013 5,690,435 6,720,237 Sanitation 4,521 11,712,501 9,096,965 Health, education and welfaze 5,002,914 3,988 Culture and recreation 10,682,846 779,004 5,339,131 Pension and retirement contributions 12,533,069 1,762,378 Health fund 7,923,090 764,757 Miscellaneous 2,431,467 515,151 26,953 Capital outlay 4,458,536 Debt service: Interest and fiscal charges 13,029 18,892 7,597,938 Principal retirement 19,051 221,567 5,984,439 Total expenditures 115,546,118 24,291,842 13,582,377 30,458,425 Excess (deficiency) of revenues over expenditures 18,064,074 (4,913,060) (12,643,022) (22,545,836) Other financing sources (uses): Increase in capital lease obligations 469,210 Sale of general fixed assets 14,598 Intergovernmentalloans 12,092,855 Proceeds from sale of bonds 15,098 Operating transfers in 1,100,223 7,288,988 13,621,670 3,067,261 Operating transfers out (21,471,085) (2,658,425) (939,355) Total other financing sources (uses) (19,887,054) 4,630,563 12,682,315 15,175,214 Excess (deficiency) of revenues and other sources over expenditures and other uses (1,822,980) (282,497) 39,293 (7,370,622) Fund balances, beginning of year 31,760,613 7,779,279 18,670,630 50,973,175 Increase in reserve for inventories 401,438 Fund balances, end of year $30,3~39~ $7,496,782 $18,7~09,923~ $43,602,553 See accompanying notes to combined financial statements. -24- Fiduciary Totals Fund Type (Memorandum Only) Expendable This[ 1242 142f $ $96,124,132 $101,754,989 6,123,507 5,836,082 8,390,887 52,098,957 44,887,565 7,795,835 8,032,090 346,436 665,479 83,808 37,884 198,373 6,068,940 4,893,432 277,621 2,066,184 1,904,077 8,866,881 170,707,799 168,011,268 26,230,653 18,423,667 87,082,237 53,177,308 13,703,685 10,712,821 20,813,987 19,886,018 8,180,594 13 ,187,496 14,524,423 16,800,981 13,321,886 71,562 14,367,009 13,326,008 8,687,847 8,251,004 2,973,571 3,259,986 4,458,536 1,750,836 263 7,630,122 6,120,739 3,777 6,228,834 5,937,598 8,256,196 192,134,958 168,362,294 610,685 (21,427,189) (351,026) 469,210 14,598 34,547 12,092,855 5,322,656 15,098 29,913,152 25,078,142 24,293,739 (9,277) (25,078,142) (24,293,739) (9,277) 12,591,761 35,270,355 601,408 (8,835,398) 34,919,329 4,691,110 113,874,807 78,690,746 401,438 264,732 $5,292,518 $108,440,847 $113,874,807 -25- COUNTY OF HAWAII Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Non-GAAPBndgetary Basis General and Special Revenue Fund Types For Lhe Ficca! Year Fnded tune 30. 1997 General Fund Special Revenue Funds Variance - Variance - Favorable Favorable Bud¢e[ A!<tual jlinfavorablel Budeet AClual jLinfavorablel Revenues: Taxes and assessments $85,588,000 $86,489,656 $ 901,656 $9,275,000 $9,634,477 $359,477 Licenses and permits 3,445,515 3,150,742 (294,773) 3,272,050 2,972,767 (299,283) Intergovernmental 39,780,072 40,061,839 281,767 443,000 434,121 (8,879) Chazgesforcurrentservices 1,572,766 1,698,829 126,063 7,501,555 6,097,004 (1,404,551) Fines and forfeitures 766,000 346,437 (419,563) Rents 39,600 83,808 44,208 Interestand penalties 3,400,000 4,864,818 1,464,818 Miscellaneous 2,752,912 2,959,531 206,619 185,600 274,529 88,929 Total revenues 137,344,865 139,655,660 2,310,795 20,677,205 19,412,898 (1,264,307) Expenditures: Current: General government 22,279,023 19,939,055 2,339,968 493,482 38,007 455,475 Public safety 54,858,467 51,483,119 3,375,348 2,622,040 2,329,445 292,595 Highways and streets 1,147,013 1,146,177 836 5,729,092 4,920,574 808,518 Sanitation (118,792) 118,792 15,319,029 11,722,460 3,596,569 Health, education and welfare 5,239,734 4,975,407 264,327 6,000 3,988 2,012 Culture and recreation 10,708,806 9,992,762 716,044 849,975 794,984 54,991 Pension/retirement contributions 12,588,260 12,533,069 55,191 1,943,616 1,762,379 181,237 Health fund 7,945,243 7,923,090 22,153 801,882 764,757 37,125 Miscellaneous 5,958,222 2,354,520 3,603,702 1,419,723 516,609 903,114 Capital outlay 8,624,433 8,624,433 Total expenditures 129,349,201 118,852,840 10,496,361 29,184,839 22,853,203 6,331,636 Excess (deficiency) of revenues over expenditures 7,995,664 20,802,820 12,807,156 (8,507,634) (3,440,305) 5,067,329 Other financing sources (uses): Operating transfers in 1,094,369 1,100,223 5,854 10,076,553 7,288,988 (2,787565) Operating transfers out (26,271,325) (23,112,001) 3,159,324 (2,760,868) (2,658,425) 102,443 Total other financing sources (uses) (25,176,956) (22,011,778) 3,165,178 7,315,685 4,630,563 (2,685,122) Excess (deficiency) of revenues and other sources over expendittues and other uses (17,181,292) (1,208,958) 15,972,334 (1,191,949) 1,190,258 2,382,207 Unbudgeted self-insurance activities (144,641) (144,641) Fund balances, beginning of year 31,760,613 31,760,613 7,779,279 7,779,279 Fund balances, end of year $14,5 $30,407,014 $15,8~,6~ $6,587,330 $8,95® $2,382,207 See accompanying notes to combined financial statements -26- Totals (Memorandum Only) Variance - Favorable (iinfavnrablel $94,863,000 $96,124,133 $ 1,261,133 6,717,565 6,123,509 (594,056) 40,223,072 40,495,960 272,888 9,074,321 7,795,833 (1,278,488) 766,000 346,437 (419,563) 39,600 83,808 44,208 3,400,000 4,864,818 1,464,818 2,938,512 3,234,060 295,548 158,022,070 159,068,558 1,046,488 22,772,505 19,977,062 2,795,443 57,480,507 53,812,564 3,667,943 6,876,105 6,066,751 809,354 15,319,029 11,603,668 3,715,361 5,245,734 4,979,395 266,339 11,558,781 10,787,746 771,035 14,531,876 14,295,448 236,428 8,747,125 8,687,847 59,278 7,377,945 2,871,129 4,506,816 8,624,433 8,624,433 158,534,040 141,706,043 16,827,997 (511,970) 17,362,515 17,874,485 11,170,922 8,389,211 (2,781,711) (29,032,193) (25,770,426) 3,261,767 (17,861,271) (17,381,215) 480,056 (18,373,241) (18,700) 18,354,541 (144,641) (144,641) 39,539,892 39,539,892 $21,1~~ $39,3®~76~591a $18,209,900 _27_ COUNTY OF HAWAII Combined Statement of Revenues, Expenses and Changes in Retained Earnings Proprietary Fund Type and Discretely Presented Component Unit For the Fiscal Year Ended June 30, 1997 (With comoara[ive totals for the fiscal vear ended Lune 30- 19961 Component Totals Unit (Memorandum Only) Depaztment Reporting Enterprise of Water Entity Fnnds Su°niv 1222 122fi Operating revenues: Water sales $ $17,778,109 $17,778,109 $15,805,391 Rental receipts from tenants 266,206 266,206 132,982 Rental subsidy from federal government -HUD 156,332 156,332 158,719 Miscellaneous 5,699 5,699 3,308 Total operating revenues 428,237 17,778,109 18,206,346 16,100,400 Operating expenses: Power and pumping 6,514,098 6,514,098 6,228,191 Utilities 33,929 33,929 14,413 Maintenance and repairs 14,662 1,976,807 1,991,469 2,410,547 General and administration 178,278 2,469,904 2,648,182 2,148,311 Customers' accounting and collecting 892,228 892,228 914,198 Transmission and distribution 703,068 703,068 681,016 Purification 788,789 788,789 835,140 Source of supply 58,804 58,804 40,871 Lease expense 76,226 76,226 19,056 Depreciation 44,640 4,506,486 4,551,126 4,731,395 Total operating expenses 347,735 17,910,184 18,257,919 18,023,138 Operating income (loss) 80,502 (132,075) (51,573) (1,922,738) Nonoperating revenues (expenses): Interest income 34,881 1,104,686 1,139,567 1,324,788 Other revenue 146,887 146,887 111,752 Interest on long-term debt (83,256) (723,871) (807,127) (877,564) Other expenses (12,729) (12,729) (11,226) Loss on disposal of fixed assets (274,756) (274,756) (254,364) Total nonoperating revenues (expenses) (48,375) 240,217 191,842 293,386 Ne[income(loss) 32,127 108,142 140,269 (1,629,352) Add depreciation on contributed utility plant 3,534,325 3,534,325 3,468,629 Increase in retained earnings 32,127 3,642,467 3,674,594 1,839,277 Retained earnings, beginning of yeaz 511,951 36,002,620 36,514,571 34,675,294 Retained earnings, end of year $544,078 $39,645,087 $40,189,165 $36,514,571 See accompanying notes to combined financial statements. _28_ COUNTY OF HAWAII Combined Statement of Cash Flows Increase in Cash and Cash Equivalents Proprietary Fund Type and Discretely Presented Component Unit For the Fiscal Year Ended June 30, 1997 (With comoarative toLS for the fiscal_ year ended Irene 30 19961 Component Totals Unit (Memorandum Only) Department Reporting Enterprise of Water Entity Funds S-uAR1X 1242 1225. Cash flows from operating activities: Cash received from customers $ $17,934,049 $17,934,049 $15,076,275 Cash received from tenants 268,359 268,359 149,313 Cash received from federal government - HIJD 156,332 156,332 158,719 Cash payments to suppliers for goods and services (290,441) (9,367,115) (9,657,556) (8,686,234) Cash payments to employees for services (4,220,279) (4,220,279) (3,998,170) Net cash provided by operating activities 1 4,250 4,346,655 4,4 ,905 Cash flows from capital and related financing activities: Principal paid on long-term deb[ (10.656) (844,500) (855,156) (841,261) Interest paid on long-term debt (83.256) (723,206) (806,462) (876,579) Proceeds from sale of fixed assets 27,482 27,482 Acquisition and consWCtion of capital assets (2,104) (8,429,780) (8,431,884) (6,130,027) Capital contributions 3,245 1,887,761 1,891,006 1,279,135 Net cash used for capital and related financing activities (92,771) (8,082,243) (8,175,014) (6,568,732) Cash flows from investing activities: Purchase of investments (1,500,000) (77,287,202) (78,787,202) (79,160,896) Proceeds from sale and maturities of investments 1,500,000 79,919,288 81,419,288 81,802,785 Interest on investments 34,719 1,123,779 1,158,498 1,309,294 Net cash provided by investing activities 34,719 3,755,865 3,7 0,5 ,951,183 Net increase in cash and cash equivalents 76,198 20,277 96,475 82,354 Cash and cash equivalents at beginning of year 532,509 158,536 691,045 608,691 Cash and cash equivalents at end of year $608,707 $ 178,813 $ 787,520 $ 691,045 (Continued) -29- COUNTY OF HAWAII Combined Statement of Cash Flows Increase in Cash and Cash Equivalents Proprietary Fund Type and Discretely Presented Component Unit For the Fiscal Yeaz Ended June 30, 1997 R'Jith cotpp,~rativ totalc for the ticc~year nd d r me 30 19961 Component Totals Unit (Memorandum Only) Department Reporting Enterprise of Water Entity Fsluds S-uRp1X 1212 122fi Reconciliation of operating income [o net cash provided by operating activities: Operating income (loss) $ 80,502 ($132,075) ($51,573) ($1,922,738) Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation 44,640 4,506,486 4,551,126 4,731,395 Provision for uncollec[ible accounts 146,694 146,694 154,000 (Increase) decrease in accounts receivable 3,351 261,234 264,585- (723,481) (Increase) decrease in prepaid expenses 58 (7,792) (7,734) 9,054 (Increase) decrease in other receivables 399 399 (945) Increase in inventory (92,311) (92,311) (21,242) Increase (decrease) in tenant security deposits (2,007) (2,007) 17,562 Increase in unearned rent 28 28 94 Increase (decrease)in warrants payable 3,987 112,673 116,660 (161,127) Increase (decrease) in accounts payable 40 (834,429) (834,389) 796,154 Increase (decrease) in other liabilities 3,252 386,175 389,427 (178,823) Total adjustments 53,748 4,478,730 4,532,478 4,622,641 Net cash provided by operating activities 13~ $4,346,655 $4 $2,699,903 Noncash capital activities: During the fiscal years ended June 30, 1997 and 1996, a component unit of the reporting entity, the Department of Water Supply, received infrastructure property costing $3,140,106 and $2,274,156, respectively, as contributions in aid of construction. See accompanying notes to combined financial statements. -30- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 The accounting policies of the County of Hawaii (County) conform to generally accepted accounting principles as applicable to local governmental units. The following notes to the financial statements are an integral part of the County's Comprehensive Annual Financial Report. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Financial Reporting Entity The County has implemented Governmental Accounting Standards Board Statement No. 14, "The Financial Reporting Entity" (the Statement). No organizations, activities or functions that meet the criteria in the Statement for inclusion in the reporting entity are excluded from the general purpose financial statements. Primary Government The County of Hawaii operates under the Mayor-Council fore of government under a charter that became effective on January 2, 1969, and was amended in 1979, 1982, and 1990. The County's operations are organized by the following functions: general government; public safety; highways and streets; sanitation; health, education and welfare; culture and recreation; pension and retirement contributions; health fund; miscellaneous; capital outlay; and debt service. The State of Hawaii assumes full responsibility for several major functions usually performed by local governments, including education, welfare, health and judicial functions. There are no separate city, county or township governments nor any school districts, special districts, authorities or public corporations with overlapping authority. In the Statement, component units are defined as legally separate organizations for which the elected officials of the primary government are financially accountable. "Financial accountability" is the level of accountability that exists if a primary government appoints a voting majority of an organization's governing board and is either able to impose its will on that organization or there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on, the primary government. A primary government has the ability to impose its will on an organization if it can significantly influence the programs, projects, activities or level of services performed or provided by the organization. An organization has a financial benefit or burden relationship with the primary government if any one of three conditions exist: (1) The primary government is legally entitled to or can otherwise access the organization's resources; (2) The primary government is legally obligated or has otherwise assumed the obligation to finance the deficits of, or provide financial support to, the organization; or (3) The primary government is obligated in some manner for the debt of the organization. As required by generally accepted accounting principles as set forth in the Statement, these general purpose financial statements present the County of Hawaii (the primary government) and its one component unit, the Department of Water Supply. This component unit is -31- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 included in the County's reporting entity because of its financial relationship with the county. Discretely Presented Component Unit The component unit column in the combined financial statements includes the financial data of the Department of Water Supply (Department), a semiautonomous agency of the County that is accounted for as an enterprise fund. It is reported in a separate wlumn to emphasize that it is legally separate from the County. The members of the Water Commission, the governing body of the Department, are appointed by the Mayor of the County and confirmed by the County Council. The Department is granted corporate powers by state statute and the County's Charter. Although the County does not have the authority to approve or modify the Department's operational and capital budgets, the County has assisted the Department by issuing bonds that are general obligations of the County on the Department's behalf. Because the County is obligated to repay these bonds if the Department does not make payment, the County is considered to be financially accountable for the debts of the Department. See Note 16 for required note disclosures for the Department. Complete financial statements of the Department can be obtained from the Department of Water Supply, 25 Aupuni Street, Hilo, Hawaii 96720. Fund Accounting The accounts of the County are organized on the basis of funds and account groups, each of which is considered to be a separate accounting entity. The operations of each fund are acwunted for with a separate set ofself-balancing accounts that comprise its assets, liabilities, equity, revenues and expenditures (or expenses). Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain functions or activities. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which the resouroes are to be spent and the means by which spending activities are wntrolled. The various funds are grouped by type in the financial statements. The County has the following fund types and account groups: Governmental Fund Types -Governmental funds are those through which most governmental functions of the County are financed. The acquisition, use and balances of the County's expendable financial resources and the related liabilities (except those accounted for in proprietary funds) are accounted for through governmental funds. The measurement focus follows the flow of current financial resources concept. The following are the County's governmental fund types: General Fund -The general fund is the general operating fund of the County. It is used to account for all financial resources except those required to be accounted for in other funds. -32- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Special Revenue Funds -Special revenue funds are used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditures for specified purposes. Debt Service Funds -Debt service funds are used to account for the accumulation of resources for, and the payment of, general long-term debt principal, interest and related costs. Capital Projects Funds -Capital projects funds are used to account for financial resources to be used for the acquisition or construction of major general government capital facilities and infrastructure (other than those financed by proprietary funds and trust funds) when separate project centers are needed to control costs. Capital outlay for relatively minor general government assets or for projects that do not need separate project centers to control costs are financed directly from operating funds (general, special revenue and some expendable trust funds). Proprietary Fund Type - A proprietary fund is used to account for the County's ongoing organizations and activities which are similar to those ofren found in the private sector. The measurement focus follows the flow of economic resources concept. The proprietary funds of the County and its discretely presented component unit have elected to apply all applicable GASB pronoumcements, as well as Financial Accounting Standards Board (PASS) pronouncements and Accounting Principles Board opinions issued on or before November 30, 1989, unless those pronouncements or opinions conflict with or contradict GASB pronouncements. The proprietary funds of the County and its discretely presented component unit will not apply FASB Statements and Interpretations issued afrer November 30, 1989. The following is the County's proprietary fund type: Enterprise Fund -Enterprise funds are used to account for operations (a) that are financed and operated in a manner similar to private business enterprises -where the intent of the governing body is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or (b) where the governing body has decided that periodic determination of revenues earned, expenses incurred and/or net income is appropriate for capital maintenance, public policy, management control, accountability or other purposes. Fiduciary Fund Types -Fiduciary funds are used to account for assets held by the County in a trustee capacity or as an agent for individuals, private organizations, other governmental units and/or other funds. The following is the County's fiduciary fund type: Trust and Agency Funds -Expendable trust funds are accounted for and reported similarly to governmental funds because the measurement focus follows the flow of -33- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 current financial resources concept. Agency funds are custodial (assets equal liabilities); thus, accounting for them does not involve measurement of results of operations. Account Groups -Account groups are used to establish accounting control and accountability for the County's general Lang-tens debt and general fixed assets. Account groups are not funds and accordingly, do not reflect available financial resources and related liabilities. The following are the County's account groups: General Long-Term Debt Account Group -This account group is established to account for all long-term liabilities that will be financed from governmental funds. Long-term liabilities of the enterprise funds are accounted for in those funds. General Fixed Assets Account Group -This account group is established to account for all fixed assets of the County, other than those accounted for in the enterprise funds. Basis of Accounting Basis of accounting refers to the period in which revenues and expendimres (or expenses) are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. Modified Accrual Basis -The modified accrual basis of accounting is followed by the County's governmental and fiduciary fund types. Under the modified accrual basis of accounting, revenues are recorded when susceptible to accrual (that is, both measurable and available). "Measurable" means the amounts are determinable. "Available" means the amounts are collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Licenses and permits, chazges for services, fines, forfeits and penalties and other revenues are recorded as revenues when received in cash because they are generally not measurable until actually received. Real property taxes levied for the current year and State Revolving Fund loan proceeds are considered available when collected. In applying the susceptible to accrual concept to intergovernmental revenues, the legal and contractual requirements of the numerous individual programs are used as guidance. There are essentially two types of these revenues. Tn one, moneys must be expended on the specific purpose or project before any amounts will be paid to the County; therefore, revenues are rewgnized based upon the expenditures recorded. Most construction grants and many operating grants fall into this category. In the other, moneys are virtually unrestricted as to purpose of expenditure and are usually revocable only for failure to -34- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 comply with prescribed wmpliance requirements. These resources are reflected as revenues at the time of receipt or earlier if the susceptible to accmal criteria are met. The County reports deferred revenue on its combined balance sheet (Note 6). Deferred revenues arise when a potential revenue does not meet both the "measurable" and "available" criteria for recognition in the current period. In subsequent periods, when both revenue recognition criteria are met, the liability for deferred revenue is removed from the combined balance sheet and revenue is recognized. Expenditures are recognized under the modified accrual basis of accounting in the accounting period in which the fund liability is incurred. Exceptions to this general rule include: (a) accumulated compensated absences, and claims and judgments which are included in the general long-tens debt account group and are recognized as expenditures when paid; (b) liabilities related to municipal solid waste landfill closure and postclosure care costs; and (c) principal and interest on general long-term debt which are recognized as expenditures when due. Accrual Basis -The proprietary fund type utilizes the accmal basis of accounting. Revenues are recognized when earned and expenses are recognized when the related obligation is incurred. Encumbrances The general, special revenue, capital projects and expendable tmst funds follow encumbrance accounting under which purchase orders, contracts and other commitments are recorded as a reserve of fund balance and provide authority for the carryover of appropriations to the subsequent year in order to complete these transactions. Encumbrances outstanding at year end are reported as reservations of fund balances and do not constitute expenditures or liabilities because the commitments will be honored during the subsequent year. Unexpended Allotments Allotment accounting is employed in the general and capital projects funds to reserve appropriations to complete capital projects that were funded during a given fiscal period. Unexpended allotments represent reserves of capital projects appropriations that are available to complete such projects in future fiscal periods. Cash and Investments Cash and cash equivalents include cash on hand, amounts in demand deposits and short- tenn investments with a maturity date within three months of the date acquired by the County. Investments include time deposits at financial institutions and bank repurchase -35- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 agreements with an initial maturity exceeding three months, which are stated at cost which approximates market value (see Note 3). Deferred compensation fund assets representing investments in mutual funds are stated at market value. Real Property Taxes The County's real property taxes are levied July 1 each year on assessed valuation as of January 1. The taxes become a lien on the property assessed as of the levy date. Taxes are due and payable in two equal annual installments on August 20 and Febmary 20. Accordingly, real property taxes receivable as of June 30 are delinquent and are reported as deferred revenue. Each delinquent installment bears interest at 1% per month and penalties of up to 10% percent of the amount due. Assessments are based on 100% of estimated fair market values. Real property tax revenue is recorded when it becomes available. Available means collected within the current period unless the amounts expected to be collected soon thereafter (within 60 days) are material or are to be used to pay liabilities of the current period. No such amounts are included in real property tax revenues for the fiscal year ended June 30, 1997. Inventories Inventories consist of materials and supplies and are reported as expenditures at the time of purohase (purchase method). Police and fire department inventories are stated using the first in, first out (FIFO) method. Other inventories are stated at average cost. Liquor Control Section 281 of the Hawaii Revised Statutes requires that liquor license revenues collected be used only for costs and expenses directly relating to operational and administrative costs actually incurred by the liquor commission collecting such fees. The unexpended fees at June 30, 1997 of $225,435 are reflected as a reserve of general fund balance. Fixed Assets Fixed assets acquired for general governmental purposes are recorded as expenditures in the fund financing the purchase and are capitalized at cost in the general fixed assets account group. Gifts or wntributions of fixed assets are recorded at their estimated fair market value on the date contributed. No depreciation has been provided for general fixed assets. Fixed assets consisting of certain improvements (other than buildings), including roads, bridges, curbs and gutters, streets and sidewalks, drainage systems and lighting systems, -36- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 have not been capitalized. Such assets normally are immovable and of value only to the County; therefore, the purpose of stewardship for capital expenditures is satisfied without recording these assets. Depreciation is recorded in one enterprise fund, the Kulaimano Elderly Housing Project. It is computed using the straight-line method over the estimated useful lives of the assets: Buildings 50 years Furnishings and equipment 5 to 10 years Ground and site improvements 20 to 50 years Long-term Obligations The County reports long-term debt of governmental funds at face value in the general long- term debt account group. Certain other governmental fund obligations not expected to be financed with current available resources are also reported in the general long-term debt account group. Long-term debt and other obligations financed by the enterprise fund are reported as liabilities in the funds. Compensated Absences Employees earn vacation credit at the rate of one and three-quarter working days for each month of service. Up to ninety days of vacation leave credits can be accumulated per employee. In addition, employees who work overtime can elect to take compensatory time off instead of overtime pay. The time off is earned at the rate of one and a half hours for each hour of overtime worked. There is no statutory limit to the amount of compensatory time off an employee can accumulate. Both compensatory time off and vacation credits are converted to pay upon termination of employment. The amounts expected to be liquidated with expendable available resources are accrued in the appropriate funds and the amounts payable from future resources aze recorded in the general long-term debt account group along with the estimated liability for FICA taxes and employers' retirement contributions on those amounts. All accumulated unpaid vacation and compensatory time off at June 30, 1997 is expected to be liquidated with future expendable resources. Sick leave accumulates without limit. Sick leave can be taken only in the event of illness and is no[ convertible to pay upon termination of employment. Accumulated sick leave at June 30, 1997 totaled $39,533,420 for the primary government. -37- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Leases Leases transferring substantially all of the risks and benefits of ownership are recorded as capital leases; other leases are operating leases. Capital leases are recorded as fixed asset additions at their estimated fair market value at the inception of the lease and the related present value of the future minimum lease obligations is recorded aslong-term debt. Operating lease expenditures and expenses are recognized when the lease obligation is paid. Retirement Plan Contributions The County's contribution to the State of Hawaii Employees' Retirement System is based upon actuarial computation and includes current service costs and amortization of prior service costs over a period of twenty-two years from July 1, 1994. The County's policy is to fund pension costs accrued. The County is required by State statute to fund the actuarially determined pension contribution requirement annually. New Pronouncement This year, the County has implemented Governmental Accounting Standards Board (GABS) Statement No. 30, "Risk Financing Omnibus," which is an amendment to GASB Statement No. 10. Totals Columns Included on the combined financial statements are total columns, marked "memorandum only," that are presented only for informational purposes. Adjustments to eliminate interfund transactions have not been recorded in arriving at such amounts and the totals are not intended to fairly present the financial position or results of operations of the County taken as a whole. Additionally, the 1996 totals presented in the totals columns are intended to provide a summarized comparison with comparable 1997 amounts and are not intended to present all information necessary for a fair presentation of financial position and results of operations in accordance with generally accepted accounting principles. Certain 1996 amounts have been reclassified to conform to classifications adopted in 1997. 2. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Annual Budget , The County follows these procedures in establishing the budgetary data reflected in the financial statements: -38- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 • On or before March 1, the Mayor submits to the County Council proposed operating and capital projects budgets for the fiscal year commencing the following July 1. The operating budget includes proposed expenditures for the general fund, special revenue funds, and one expendable trust fund (the Hawaii County Housing Agency), and the means of financing them. Aproject-length budget is submitted to the County Council for the capital projects fund. • The Mayor submits to the County Council amendments to the proposed operating and capital budgets within ten working days after the close of the State legislature, but not later than May 5. • The County Council conducts public hearings on the proposed operating and capital budgets after March 1 but prior to the first reading on the budget bills, which must be after May 5. • On or before June 30, the County Council adopts the budgets. While budget information is detailed to the object code level, the legal level of budgetary control is the depaztment level because the Mayor can transfer funds from any unencumbered appropriation to another within a department or agency without Council approval. During the year, the budget may be amended by action of the Council, except appropriations required by law and appropriations for debt service, which may not be decreased or deleted. Supplemental appropriations were made during the 1996-97 fiscal year to recognize revenue from sources not known at budget time and to establish the authorization for such funds to be expended. Such supplemental appropriations totaled $16.5 million in the General Fund and $1.0 million in the Special Revenue Funds. • Appropriations for the operating budget lapse at the end of the fiscal year to the extent that they have not been expended or encumbered. Appropriations for capital expenditures that are not encumbered lapse at the end of two fiscal years following the fiscal year that the appropriation was made. Formal budgetary integration is employed as a management control device during the year for the general fund, special revenue funds, one expendable mist fund (the Hawaii County Housing Agency), and the capital projects fund. Fornal budgetary integration is not employed for debt service funds because effective budgetary control is alternatively achieved through general obligation bond indenture provisions. • The budgetary basis of accounting for revenues and expenditures for the general, special revenue, expendable trost and capital projects funds differs from generally accepted accounting principles (GAAP basis). On the budgetazy basis (non-GAAP budgetary basis), intergovernmental revenues are recognized when awazded by the granting agency, encumbrances and unexpended allotments are treated as expenditures, -39- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 accounts payable are not accrued, and all leases are treated as operating leases. Budgetary comparisons presented in this report are on this budgetary basis. In preparing statements on the basis of GAAP, accounts payable are accrued and treated as a reduction of encumbrances for balance sheet presentation. Budget to GAAP Reconciliation The following is a summary of the adjustments necessary to convert from the GAAP basis to the non-GAAP budgetary basis for the fiscal year ended June 30, 1997: General Special Revenue Fund Funds Ending fund balance -GAAP basis $30,339,071 $7,496,782 Encumbrance adjustments: Beginning encumbrances and unexpended allotments 7,428,454 2,687,452 Ending encumbrances and unexpended allotments (6,958,973) (1,214,697) Increase in reserve for inventory of materials and supplies (401,438) Increase in petty cash (1001 Ending fund balance -Non-GAAP budgetary basis $30.407.014 .8.969. 37 3. DEPOSITS AND INVESTMENTS Bank time certificates of deposit (TCDs) and repurchase agreements (repos) with initial maturities under three months are considered cash and cash equivalents for purposes of balance sheet classification and the statement of cash flows, while TCDs and repos with initial maturities exceeding three months are considered investments. However, for purposes of the disclosures required by Government Accounting Standards Board Statement No. 3, all bank TCDs are considered deposits and all repos are considered investments. Cash and cash equivalents of $40,240,366 and investments of $69,858,629 are included in the accompanying wmbined balance sheet. The following schedule shows the balance sheet captions and the related breakdown for purposes of GASB Statement No. 3 disclosures. -40- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 GASB Statement No. 3 Balance sheet cannon: Total Deposits Investments Cash and cash equivalents $ 38,367,486 $ 3,783,818 $34,583,668 Restricted assets: Cash and cash equivalents 1,845,560 445.560 1,400,000 Impress and change funds 27.320 Total cash and cash equivalents 40,240,366 Invesimend 69.858.629 10.150.000 59.708.629 Total cash, cash equivalents and investments 110,096,995 Less impress and change tunds (273201 Classifications per GASB Statement No.3 $110.071.675 14$ 1~ 395,fi92297 The County maintains a cash and investment pool that is used by the following funds: General Ftmd, Special Revenue Funds, one Capital Projects Fund, and two Agency Funds - State Weight Tax and Payroll Clearance. The following summarizes this pool at June 30, 1997: General Fund -actual $28,924,455 Payroll Clearance Fund -overdraft (1,350,669) General Fund - as reported 27,573,786 Special Revenue Funds 9,638,534 Capital Projects Funds 40,165,546 State Weight Tax 494.429 Total pooled cash and investments $77.872.295 The cash overdraft in the Payroll Cleazance Fund is shown on the balance sheet for that fund as a liability due to the General Fund, and as a receivable from the Payroll Clearance Fund for the General Fund. Interest earned is credited to the General Fund unless otherwise designated by statute. Deposits At June 30, 1997, the carrying amount of the County's deposits was $14,379,378 (including $445,560 reported in restricted assets) and the bank balance was $14,447,492. Of the bank balance, $1,000,000 was covered by federal depository insurance; $12,941,619 was covered by collateral held by the Cotmty's agent, the State of Hawaii, in the County's name in accordance with State statutes; and $504,978 held by paying agents and $895 held by a management agent was uncollateralized. Investments The Hawaii Revised Statutes authorize the County to invest in obligations of the U.S. Treasury, agencies and instrumentalities, time certificates of deposit, bank repurchase -41- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 agreements and bonds of any improvement district of any county of the State, provided the investments are due to mature not more than three years from the date of investment. Investments are classified into three categories of credit risk: (1) insured or registered, or securities held by the County or its agent in the County's name; or (2) uninsured and unregistered, with securities held by the wunterparty's tmst department or agent in the County's name; or (3) uninsured and unregistered, with securities held by the counterparty in the County's name, or by the counterparty's tmst department or agent but not in the County's name. At June 30, 1997, the investment balances held for the County at banks and by the deferred compensation plan administrator were as follows: Canying Market Amount Value Category 1: Bank repurchase agreements $ 84,505,684 $ 84,505,684 1978 Sinking Fund repurchase agreements 11.186.613 11.186.613 95,692,297 95,692,297 Uncategorized: Investment in deferred compensation mutual fund 26.576.092 26.576.092 Total investments $122.268389 P,122.268.389 The 1978 Sinking Fund was established to service principal and interest payments of certain public improvement bonds of the County as maturities become due. The funds in the 1978 Sinking Fund are invested in three-yeaz repurchase agreements with certain regulated financial institutions and art; collateralized by U.S. Treasury notes with a market value of approximately $11,956,920 at June 30, 1997. A repurchase agreement is an agreement in which a governmental entity transfers cash to abroker-dealer or financial institution; the broker-dealer or the financial institution transfers securities to the entity and promises to repay the cash plus interest in exchange for the same securities. Restricted Cash Restricted cash includes funds the County has deposited in an escrow account. This escrow account, with a balance of $218,519 at June 30, 1997, is an account where the County deposits its share of the cost of the Alenaio Stream Flood Control Project. The Army Corps of Engineers is authorized to draw on these funds as needed during the course of the construction project. Tenant security deposits received by the County for the Kulaimano Elderly Housing Project and the Ouli Ekahi Affordable Housing Project which are refundable or restricted as to use are recorded as a restricted asset. Such funds amounted to $8,367 and $17,318 respectively at June 30, 1997. -42- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Restricted amounts set aside by the Kulaimano Elderly Housing Project under its loan agreement with the Fanners Home Administration totaled $161,207 at June 30, 1997. This amount is restricted for debt service, or for other purposes with prior approval from the Farmers Home Administration. An operating reserve fund was established by the Ouli Ekahi Affordable Housing Project pursuant to an agreement with the developer of the project. This reserve was $40,149 at June 30, 1997. The Improvement District No. 17 Fund has $1,400,000 set aside as a bond reserve to comply with the requirements of its bond issue for Kaloko Subdivision. 4. INTERFUND RECEIVABLES AND PAYABLES At June 30, 1997, interfund receivables and payables comprised the following: Due from Due to Other Funds Other Funds General Fund $2.098,088 $4,259.591 Special Revenue Funds: Highway Fund 865,469 Parking Meter Fund 86 15,185 Sewer Fund 200,799 Solid Waste Fund 488,347 236,713 Golf Course Fund 65,887 Vehicle Disposal Fund 4,482 Geothermal Royalty Fund 305 2.035 488,738 1,390,570 Capital Projects Funds: Capital Projects Fund 571.792 102 Trust and Agency Funds: Hawaii County Housing Agency 86,554 Performance & Deposit Fund 455 Payroll Cleazance Fund 3.930,268 1,351,614 3.930.268 1.438,623 Total 5. FIXED ASSETS A summary of changes in the general fixed assets account group follows: -43- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Balance Balance July 1, Re[ire- June 30, A di i ns men 1 7 Land $ 15,261,485 $ 1,694,791 $ 1,442,433 $ 15,513,843 Buildings and stmc[ures 108,648,222 14,635,410 5,319,503 117,964,129 Machinery and equipment 40,532,998 6,059,444 1,683,746 44,908,696 Cons[mction in progress 99.485.747 12.867.160 8.801.089 103.551.818 Total 5 b 9 8 45 $356~R~ $17.246.771 $281.938.486 The above summary includes fixed assets of the Hawaii County Housing Agency, an expendable tmst fund, in the amount of $5,203,059. The following summarizes the enterprise fund's fixed assets at June 30, 1997: Land $ 753,877 Buildings 1,136,008 Furnishings and equipment 87,510 Ground and site improvements 261,000 Less: accumulated depreciation (634,6921 Net fixed assets $1.603.703 6. DEFERRED REVENUE Deferred revenue at June 30, 1997 is comprised of the following: Special Capital General Revenue Projects Proprietary Fund Fund Fund Fund Total Real property taxes $13,242,620 $ $ $ $13,242,620 Liquor revenue 167,570 167,570 Sewer revenue 945,666 945,666 Tipping fee revenue 918,817 918,817 Intergovernmental 1,055,963 125,000 188,267 1,369,230 Unearned rental - 530 530 Total 514.466.153 . 1 9't 89"483 8. 18 2C7 5 $16.644.433 -44- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 7. LEASES The County leases machinery and equipment under noncancellable leases expiring at various dates through November 2006 which meet the criteria for capitalization. The leases are financed from general fund, special revenue fund and expendable trust fund resources. Accordingly, the estimated value of the leased machinery and equipment at the inception of the capital leases, amounting to $1,122,633, and the related present value of the remaining obligations under the capital leases amounting to $602,063 at June 30, 1997 are included in the general fixed asset and general long-tens debt account groups, respectively. The County also leases land, office facilities and other equipment under noncancellable operating leases expiring through July 2020. Expenditures for such leases were $507,878 for the year ended June 30, 1997. The future minimum obligations under capital and operating leases as of June 30, 1997 are as follows: Capital Operating Leases Leases Year Ending June 30: 1998 $ 66,696 $ 441,735 1999 223,146 436,780 2000 63,649 423,942 2001 63,023 408,000 2002 62,352 312,042 Thereafter 271.037 19.451 Total minimum lease payments 749,903 $2.041950 Less amount representing interest (147.840) Obligations under capital leases $602.063 S. SOLID WASTE LANDFILL CLOSURE AND POSTCLOSURE CARE COSTS Hilo Landfill The County owns and operates a landfill located in the city of Hilo. State and federal laws will require the County to monitor and maintain the site for thirty years after the facility is closed. Although the closure and postclosure care costs will be paid only near and after the date that the landfill stops accepting waste, the County rewgnizes a portion of the closure and postclosure care costs in each operating period. The liability for these costs is included in the general long-term debt account group. The amount recognized each year is based on the landfill capacity used as of the balance sheet date. At June 30, 1997, the County is recognizing a liability of $13,340,000, based on the use of 95% of the estimated capacity of the landfill. During the year ended June 30, 1997, $39,062 was spent on closure of the landfill. The remaining $1,120,000 in estimated cost of closure -45- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 and postclosure care will be recognized as the remaining estimated capacity is used. These amounts are based on what it would cost to perform the required closure and postclosure care in 1997. Actual costs at that time may be higher due to inflation, changes in technology, or changes in regulations. The County presently has permits to operate the Hilo landfill through October, 1998. Federal regulations require owners and operators of landfills to demonstrate financial assurance for the costs of closure, postclosure care, and corrective action for known releases associated with their facilities. The Environmental Protection Agency has developed final rules related to financial assurance mechanisms, including a local government financial [est. Under the rules, the County is self insured as shown below. The County estimates that this assurance is adequate to cover its full liability for the Hilo and Kealakehe landfills. Fund Total Revenues. FY97 General Fund $133,610,192 Special Revenue Fund 19,378,782 Debt Service Fund 939.355 Total Revenue 8153928329 43% of revenue $66,189,180 UST assurance (1,000,000) $65.189.1 RO Available to assure landfill closure, post- closure and corrective action Amount to be assured: Hilo landfill $13,340,000 Kealakehe landfill 785,000 Total liability to be assured $14.125.000 Kealakehe In October, 1993, the County closed its Kealakehe landfill in Kona. Under state and federal requirements, the County will have to monitor and maintain this site for ten years from the closure date. The full estimated cost of closure and postclosure care if it were all performed in 1997 is $6,750,000. Actual costs may be higher due to inflation, changes in technology, or changes in regulations. Through June 30, 1997, $5,965,000 was spent on closure and postclosure care of the landfill. The remaining estimated liability, $785,000, is included in the general long-tern debt account group. During the year ended June 30, 1997, a total of $105,253 was spend on this landfill. Of this amount, $9,428 was for gas monitoring and training, $73,291 was for landfill closure phases two and three, and $22,534 was for management of a subterranean fire at the landfill. The County is providing financial assurance for postclosure care and remediation through self insurance as explained in above. -46- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Pu'uanahulu In May, 1993, the County contracted with a private company to construct and operate a new landfill on County land at Pu'uanahulu in West Hawaii. As a part of the wntrect, the private company assumed full responsibility and liability for closing the landfill and for maintenance and monitoring of the landfill for the required period of time after closure. Under the terms of the contract, the County had no responsibility for remediation, closure or postclosure care. This contract was challenged in court by a public employee union. The County prevailed in court decisions through the Circuit Court level, but in Febmary, 1997, the Hawaii Supreme Court rendered a decision in favor of the union. This decision stated that the contract with the private company was void. The County has negotiated a new contract with the same private company with the approval of the Court. This contract provides for County employees to perform the daily operations of the landfill, and for the private company to perform all construction work on the landfill cells. Under this tentative agreement, the County will continue to have no responsibility for remediation, closure or postclosure care. Accordingly, no liability for this landfill is included in the County's financial statements. 9. LONG-TERM DEBT General Obligation Bonds The County issues general obligation bonds to provide funds for the acquisition and cons[roction of major capital facilities. These bonds have been issued by the County for both primary government and component unit activities (Note 16). The following is a summary of general obligation bond transactions reported in the general long-remr debt account group for the County for the fiscal year ended June 30, 1997: Bonds payable, July 1, 1996 $125,323,000 Bonds issued 4,772,500* Bonds retired (4,681,500) Bonds payable, June 30, 1997 $125.414.000 * Issued to agencies of the federal government. The capital projects fund shows $15,098 as proceeds from the sale of bonds. This is the remaining proceeds from the 1996 Series A issue, returned from the fiscal agent as the amount left from the bond proceeds set aside to cover the costs of issuance after payment of all of those costs. General obligation bonds payable reported in the general long-term debt account group at June 30, 1997 are comprised of the following individual issues: -47- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Public improvement and/or refunding bonds: 1977 Series A at 5.0°k, due through 2012 $ 324,000 1978 Refunding at 5.0% to 6.5%, due through 2007 21,695,000 1989 Refunding at 6.2% to 6.95%, due through 2004 2,702,500 1993 Refunding & PI at 2.5% to 5.6%, due through 2013 65,930,000 1996 Series A at 4.5°k to 5.5°k, due through 2016 30,000,000 1996 Series B at 4.5% through 2016 762,500 1997 Series A at 4.875% through 2017 4,000,000 Total general government $125.414.000 Annual debt service requirements to maturity for [he above general obligation bonds, including interest payments of $63,995,665 are as follows: Fiscal Yeaz General Long-Term Endine June 30 Debt Account Grouo 1998 $ 11,798,366 1999 12,848,324 2000 12,822,692 2001 12,787,42() 2002 12,760,378 Thereafter 126.392.485 Total $189.409.665 Refunded Bonds The County issued Public Improvement Refunding Bonds in 1978 and 1993. The proceeds from both of the series were irrevocably deposited in separate refunding trrsts. These trusts were set up to retire certain public improvement bonds of the County as maturities become due. It is anticipated [ha[ the amounts deposited with the refunding trustees, together with interest earrings thereon, are sufficient to meet all principal and interest payments on the general obligation bonds defeased by the issues as such payments become due. The balances in the two trusts at June 30, 1997, consisting of assets, investments (at market value) and cash, are as follows: 1978 Refunding Tmst $ 271,978 1993 Refunding Trust 33,464.939 Total $33.736.917 The assets of these trust accounts and the liability for the defeased bonds are not included in the County's financial statements. At June 30, 1997, $32,790,000 of outstanding general obligation bonds are considered defeased. -48- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 State Revolving Fund Loans The County has obtained loans to assist in financing mandated wastewater projects from the State Water Pollution Control Revolving Fund (SRF). The purpose of this revolving fund is to provide low-interest, long-teen loans and other financial assistance to the four counties in the state to finance construction of wastewater projects. The County has twelve projects approved for funding with these loans. The schedule below shows the County's SRF transactions for the fiscal year ended June 30, 1997: Loans Approved Loan Balance Loan Balance Authorized Amount 6/30/96 Additions Retirements 6/30/97 Hilo WWTP $12,724,311 $11,326,680 $ ($542,863) $10,783,8]7 WaiakeaMill 1,300,000 1,206,453 (53,893) 1,152,560 WaiakeaHslots 459,321 408,869 (18,008) 390,861 Ainako A&B 2,374,600 1,871,475 250,471 (94,321) 2,027,625 Kalanianaole 1,499,944 1,397,939 102,005 (38,135) 1,461,809 Alii Drive A&B 3,210,243 2,464,557 302,346 (123,929) 2,642,974 Alii Drive C&D 3,780,000 2,128,136 1,413,380 (175,027) 3,366,489 Alii Drive E&F 2,300,000 1,484,088 (30,160) 1,453,928 WaiahaBay 3,697,893 1,012,120 2,294,559 (177,378) 3,129,301 Kealakehe 1,300,071 1,199,938 (49,477) 1,150,461 Holualoa Bay 3,500,000 1,473,506 1,473,506 Disappear. Sands 2.000.000 - 53R.146.3R3 $23.016.167 87 (51.303.1911 829.033.331 Repayment of the loans begins either one year after the constmction cutoff date or one year after the notice to proceed is given for the constmction project. Debt service to maturity, including interest payments of $10,262,597, is given below for the disbursements to date on these projects. Year ending June 30: 1998 $ 2,278,139 1999 2,278,139 2000 2,278,139 2001 2,278,139 2002 2,278,139 Thereafter 27,905.233 Total 539.295.928 -49- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Other Long-term Debt The following is a summary of other general long-term debt transactions for the fiscal year ended June 30, 1997: Balance Deductions Balance 7 1 Additions & Pavmen[s 6/30/97 Compensated absences $13,917,849 $3,868,030 $ $17,785,879 Es[. claims & judgments 5,220,750 4,418,418 (2,639,168) 7,000,000 Capital lease obligations 377,248 469,210 (244,395) 602,063 Landfill closure costs 13.465.000 804.315 (144.315) 14.125.000 Total $32.980.847 $9.559.973 ($3.027.8781 R 951 9a4~ Fund Balances -Debt Service Funds The fund balance in the debt service funds at June 30, 1997 includes $18,429,799 which is available for principal payments on general obligation bonds and $280,124 which is set aside for the payment of interest on the bonds. Enterprise Fund Debt The Kulalmano Elderly Housing Project is indebted to the U.S. Department of Agriculture, Farmers Home Administration on two notes payable with balances aggregating $1,171,731 at June 30, 1997. The notes, which mature in September 2029, are repayable in monthly installments of $7,826 including interest and are collateralized by substantially all of the project's property and equipment. Although the stated annual rate of interest on the notes is 9%, such rate is reduced to 7% for as long as the Project has a U.S. Department of Housing and Urban Development Section 8 Housing Assistance Payment contract in effect for all or part of the units within the Project. Special Assessment Bonds The County has outstanding special assessment bonds for one improvement district. In 1991, the County issued $14 million of special assessment bonds for Improvement District No. 17, Kaloko Subdivision, to finance a roadway and water system. The bonds mature annually through 2011 and bear interest at 9.5%. Total special assessment bonds payable were $12,670,000 at June 30, 1997. These are not general obligation bonds and the County is not obligated in any manner for the repayment of these bonds. The bonds are secured by a first lien on the land benefited by the improvements, and are to be repaid from the annual assessments levied against the owners of the land. The County acts as an agent for the property owners within the improvement -50- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 districts to collect assessments receivable, forward payments to bond-paying agents at appropriate dates and, if required, administer foreclosure proceedings. Accordingly, these bonds are not reflected on the County's financial statements. The following is a summary of special assessment bond transactions for the year ended June 30, 1997: I.D. 17 Kaloko Subd. Balance, June 30, 1996 $13,050,00() Deductions -maturities (380.000) Balance, June 30, 1997 $12.670.000 The following is a summary of the annual maturities including interest of $11,006,700 for special assessment bonds: Year ending June 30: 1998 $ 1,598,937 1999 1,597,613 2000 1,592,487 2001 1,593,088 2002 1,588,938 Thereafter 15.705.637 Total $23.676.700 10. CONTRIBUTED CAPITAL Contributed capital of $411,296 in the Kulaimano Elderly Housing Project represents contributions from private and government sources at the inception of the project. There were no changes to contributed capital for this fund during the current yeaz. Contributed capital of $544,367 in the Ouli Ekahi Affordable Housing Project at June 30, 1997, represents contributions received from developers. Additional contributions of $3,245 were received during the year. 11. SEGMENT INFORMATION -ENTERPRISE FUNDS The County maintains two enterprise funds. The Kulaimano Elderly Housing Project (KEHP) provides low-income rental housing for senior citizens. The Ouli Ekahi Affordable Housing Project (OEAHP), which wmmenced operations during the year, provides affordable single-family rental housing to qualifying tenants. Selected segment information for the year ended June 30, 1997, is as follows: -51- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 KEHP OEAHP Total Operating revenues $237,326 $190,911 $428,237 Depreciation 44,640 44,640 Operating income (loss) 88,836 (8,334) 80,502 Net income (loss) 39,139 (7,012) 32,127 Current capital contributions 3,245 3,245 Net change in fixed assets 42,536 42,536 Net working capital 856,082 (4,213) 851,869 Total assets 2,154,137 570,703 2,724,840 Long-term loan payable 1,171,731 1,171,731 Total equity 957,337 542,404 1,499,741 12. FUND EQUITY Designated Fund Balance A designation of unreserved fund balance indicates tentative plans for the use of current financial resources in the future. Fund balances designated at June 30, 1997 are composed of the following: General Fund: Impress and change funds $ 25,070 Drug enforcement 32,354 Special duty police program 206,235 Future yeaz expenditures 15,800,000 Claims and judgments 1.083.048 Total general fund $17,146,707 Special Revenue Funds: Impress and change funds 2,000 Equipment replacement 1,106,775 Future year expenditures 3,062,252 Future project 1,000 Total special revenue funds 4,172,027 Capital Projects Funds: Street and road repairs 6,101,662 SRF (wastewater) projects 66 750 Total capital projects funds 6,168,412 Trust and Agency Funds: Affordable housing 61,747 Total designated fund balance $27-548-893 -52- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Reserved Fund Balance Reserved fund balance represents that portion of fund balance that is either not available for appropriation or is legally segregated for a specific future use. Fund balances reserved at June 30, 1997 are composed of the following: Special Debt Capital Tnrs[ end General Revenue Service Projects Agency Fund Fund Fund Fund Fund Toul Reserved for: Encumbrences 56,958,973 $1,214,697 $ $ 6,853,073 $2.282,938 $17,309,681 Unexpended allotments 15,837,086 15,837,086 Inventories 1,980,213 1,980,213 Debt service 18,709,923 18,709,923 Liquor control 225.435 - - 225.435 Total mserved fund balance $9.164"621 $1.214.697 $18709.923 $22.690.159 $2.282.938 554.062338 Retained Earnings The Kulaimano Elderly Housing Project reports retained earnings reserved for debt service in the amount of $161,207. The Ouli Ekahi AffoMable Housing Project reports a retained deficit of $1,963. 13. COMMITMENTS AND CONTINGENCIES Contractual commitments for capital projects, expenses, and supplies at June 30, 1997, except in the enterprise funds, are reflected in the financial statements as fund balance reserved for encumbrances. Contractual commitments for the enterprise funds were immaterial. The County has received federal and state grants for specific purposes that are subject to review and audit by grantor agencies. Such audits could lead to requests for reimbursement to the grantor agency for expenditures disallowed under terms of the grant. In the opinion of management of the County, disallowed costs, if any, would not be material. Numerous claims and lawsuits have been filed against the County in the normal course of its operations. A liability for probable losses is included in the general long-term debt account group (see note 14). Although the outcome of the various claims and lawsuits is not presently determinable, in the opinion of the County's attorneys, the resolution of such matters will not have a material adverse affect on the financial condition of the County. The Hawaii Supreme Court, in its decision on the privatization of the Pu'uanahulu landfill (see note 8), ruled that under current law, jobs that have "customarily and historically" been performed by civil servants cannot be privatized. )n the interests of economy and efficiency, the County normally enters into contracts with private companies and individuals -53- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 for a variety of services. A review process has been established to evaluate these contracts to see if they are legal under the terms of the Supreme Court decision. If a contractual service is determined to have been "customarily and historically" performed by civil servants, the County may have to hire additional employees to perform these services instead of contracting them out. The financial impact of this decision cannot be determined at this time. The County will be encouraging the state legislature to provide legislative relief during the 1998 session. 14. RISK MANAGEMENT The County is exposed to various risks of losses related to tors; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The County maintains fire and commercial multiple peril insurance on County facilities, flood insurance on selected stnrctures, medical malpractice insurance for emergency medical technicians, general liability insurance for water safety officers, aviation liability for helicopter operations, and no-fault insurance coverage for privately owned police vehicles. There was no reduction in insurance covorage during the yeaz from coverage in the prior year. During the past three fiscal years, the amount of settlements in cases covered by insurance have not exceeded the insurance coverage. The County is substantially self- insured for its vehicles as well as for all other perils including workers' compensation and general liability. The County currently reports all of its risk management activities in its general fund except for workers' wmpensation, which is paid by the fund that employed the injured worker. Liabilities are reported when it is probable that a loss has oceurred and the amount of that loss can be reasonably estimated. These losses include an estimate of claims that have been incurred but not reported (IBNR). Claim liabilities, including IBNR, are based on the estimated ultimate cost of settling the claims, and include incremental costs for the hiring of special counsel and expert witnesses. Claims liabilities are estimated by a case-by-case review of all claims and the application of historical experience to outstanding claims. Estimates of IBNR are based on historical experience. The liability for claims and judgments is reported in the general long-tern debt account group because it is not expected to be liquidated with expendable financial resources. At June 30, 1997, the amount of this liability was $7,000,000. This is the County's best estimate based on available information. Changes in the reported liability since June 30, 1995 are given below. -54- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 General Workers' Total Liability Compensation Liability Balance, June 30, 1995 $ 941,900 $4,063,446 $5,005,346 Incurred claims (including IBNR)* 23,911 3,014,206 3,038,117 Claim payments (501,5611 (2,321.152) (2.822,713) Balance, June 30, 1996 $ 464,250 $4,756,500 $5,220,750 Incurred claims (including IBNR)* 2,547,977 1,870,441 4,418,418 Claim payments (520,966) (2.118,202) (2.639.168) Balance, June 30, 1997 $2.491.261 ~d 508 7'i9 *Net of new claims liability and old claims resolved at less than previous estimate. 15. EMPLOYEE BENEFIT PLANS Pension Plan All full-time employees of the County of Hawaii participate in the Employees' Retirement System of the State of Hawaii (System), a wst-sharing, multiple-employer public employee retirement system. The System regards the County of Hawaii including its component unit as one employer. Therefore separate information for the primary government and its component unit is not available. All information given below on the pension plan is for the reporting entity as a whole, including both the primary government and its component unit. The County's payroll for employees covered by the plan for the year ended June 30, 1997 was $69,478,100. The payroll for all of the County's employees for the year was $72,990,741. The actuarially determined employer's contribution paid by the County for the year ended June 30, 1997 was $11,041,700. Contributions from employees in the contributory plan was $4,227,700. These contributions represented 15.9% and 6.1% of covered payroll, respectively. The County's 1997 contribution represented 3.4% of total contributions required of all participating entities. All of the County's full-time employees are eligible to participate in the System. The System is composed of a contributory retirement plan and a noncontributory retirement plan. Eligible employees, in service and a member of the existing contributory plan on June 30, 1984, were given an option to remain in the existing plan or join the noncontributory plan, effective January 1, 1985. All new eligible employees hired after June 30, 1984 automatically become members of the noncontributory plan. Both plans provide death and disability benefits and a cost of living increase. Benefits are established by State statute. In the contributory plan, employees may elect normal retirement at age 55 with 5 years of -55- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 credited service or elect eazly retirement at any age with 25 years of credited service. Such employees are entitled to retirement benefits, payable monthly for life, of 2% of their average final salary, as defined, for each year of credited service. Benefits fully vest on reaching five years of service; retirement benefits are actuarially reduced for early retirement. Covered contributory plan employees are required by State statute to contribute 7.8% of their salary to the plan; the County is requited by State statute to contribute the remaining amounts necessary to pay contributory plan benefits when due. in the noncontributory plan, employees may elect normal retirement at age 62 with 10 yeazs of credited service or at age 55 with 30 years of credited service, or elect early retirement at age 55 with 20 years of credited service. Such employees are entitled to retirement benefits, payable monthly For life, of 1.25% of their average final salary, as defined, far each year of credited service. Benefits fully vest on reaching ten years of service; retirement benefits are actuarially reduced for early retirement. The County is required by State statute to contribute all amounts necessary to pay noncontributory plan benefits when due. There were no changes in actuarial assumptions, benefit provisions, actuarial funding method, or other significant factors during the fiscal year ended June 30, 1996. The "pension benefit obligation" is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and step-rate benefits, estimated to be payable in the future as a result of employee service [o date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's funding status on a going-wncem basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among public employee retirement systems and employers. The System does not make separate measurements of assets and pension benefit obligations for individual employers. The pension benefit obligation at June 30, 1996 (the latest date available) for [he System as a whole, determined through an actuarial valuation performed as of that date, was $7.3 billion. The System's net assets available for benefits on that date (valued at market) were $6.1 billion, leaving an unfunded pension benefit obligation of $1.2 billion. Ten-year historical trend information showing the System's progress in accumulating sufficient assets to pay benefits when due is presented in the System's annual reports. Subsequent Events An early retirement incentive measure that was enacted in an effort to reduce the state and counties' payroll costs will increase the future employer contributions to the System. Additional County funding required by this measure will be $480,700 per annum for five years beginning in the fiscal yeaz ending June 30, 1998. The 1997 state legislative session passed several measures amending state statutes relating to the System: -56- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 1) State statutes were amended to provide that 100% of the investment earnings from the System be deposited in the pension accumulation fund. Prior to this amendment, 80% of investment earnings were used to reduce the employers' actuarially determined employer contribution. 2) Another legislative amendment changed the valuation method used by the actuary to the "entry age normal cost" funding method. These two changes together will reduce the County°s employer contribution for the fiscal year ending June 30, 1998, by $4,829,800. 3) The retirement benefits formula for elected officials and legislative officers was amended to require separate calculations for service as an elected official, legislative officer, judge or general employee. 4) A reciprocal benefits package was enacted to provide spousal retirement benefits for reciprocal beneficiaries who are prohibited from marrying. The effect of these two changes on the County's employer contributions for future years cannot be determined. Post-Retirement Benefits In addition to providing the pension benefits described above, the County is required by State statute to contribute to the Hawaii Public Employees Health Fund (Health Fund), a statewide program which provides health and group life insurance for all retired and active County employees, their dependents and their beneficiaries. The State and other counties also participate in the fund. For employees hired prior to July 1, 1996 who retire with at least ten years of credited service, the County is required to pay 100% of the premiums of the medical, adult dental, prescription dmg, vision, and group life insurance plans elected by the retiree. For employees hired prior to July 1, 1996 who retire with less than ten years of credited service, the County was required by statute in the year ended June 30, 1997 to pay half of the montlily premium cost of the above plans. For employees hired July 1, 1996 or after, the amount of the premium cost the County is required to pay varies depending on the employee's years of service at the time of retirement. Currently, the County has 992 former employees who have retired with at least ten years of credited service and are receiving the full benefit. An additional seven employees have retired with less than ten years of service and have half of their medical premiums paid by the County. For each retiree and retiree's spouse eligible for Medicare, the County also pays $42.50 per month as reimbursement of their Medicare premiums. The County's contribution is recorded as an expenditure when paid. The amount of the contribution is limited by State statute to the actual cost of benefit coverage. During fiscal -57- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 year 1997, the County's contribution to the Health Fund for retired employees totaled $4.3 million. Deferred Compensation Plan County employees are permitted to participate in a deferred compensation plan of the State of Hawaii, adopted pursuant [o Internal Revenue Code (IRC) section 457. The plan permits eligible employees to defer a portion of their salary until future years by contributing to a fund managed by a plan administrator. The deferred compensation amounts are no[ available to employees until termination, retirement, death, or unforeseeable emergency. Such deferred compensation amounts are accounted for in an agency fund. Plan assets are reported at fair market value. Through June 30, 1997, all amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights were (until paid or made available to the employee or beneficiary) solely the property and rights of the County of Hawaii, subject only to the claims of the County's general creditors. Participants' rights under the plan were equal to those of general creditors of the County in an amount equal to the fair market value of the deferred amount for each participant. Effective July 1, 1997, in compliance with new federal law, a trust fund has been established to protect plan assets from claims of general creditors and from diversion to any uses other than paying benefits to participants and beneficiaries. It is the opinion of the Corporation Counsel that the County has no liability for losses under the plan, but does have the duty of due care that would be required of an ordinary prudent investor. 16. COMPONENT UNIT DISCLOSURES Cash and Investments For purposes of the statement of cash flows, the Department of Water Supply (the Department) considers all highly liquid investments with an initial maturity of three months or less to be cash equivalents. However, for the required GASB Statement No. 3 disclosures, all repurchase agreements regardless of initial maturity are considered investments. The amount of $166,382 shown on the balance sheet as cash and cash equivalents consists of cash on hand (deposit in transit) of $97,455 and balance in the checking account of $68,927. Deposits At June 30, 1997, the carrying amount of the Department's deposits was $68,927 and the bank balance was $68,927. This entire amount was covered by collateral held by the County's agent, the State of Hawaii, in the County's name in accordance with State statutes. -58- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Investments The Department is allowed to invest in the same types of instruments as the primary government (see Note 3). Investments are classified into three categories of credit risk: (1) insured or registered, or securities held by the County or its agent in the County's name; or (2) uninsured and unregistered, with securities held by the counterparty's trust department or agent in the County's name; or (3) uninsured and unregistered, with securities held by the counterparty in the County's name, or by the counterparty's trust department or agent but not in the County's name. At June 30, 1997, the Department had investments of $26,224,536 (carrying amount, which equals market value) in bank repurchase agreements, which was all in risk category 1. This investment amount includes cash received by the Department of Water Supply that is refundable or restricted as to use, and is recorded as a restricted asset. Such funds amounted to $10,753,221 at June 30, 1997. Fixed Assets The Department of Water Supply began operations as of January 1, 1950. At that date, the utility plant in service was transferred to the Department of Water Supply from the County at the cost of the utility plant assets acquired by the County for its water system from January 1, 1924 to December 31, 1949, less accumulated depreciation. Acquisitions prior to 1924 and acquisitions by gifr or grant prior to 1950 are not included in utility plant. Additions to utility plant since January 1, 1950 are stated at original cost and include contributions by governmental agencies, private subdividers and customers at their cost or estimated cost. Construction costs include amounts for contract work, engineering supervision and other direct and indirect costs. Depreciation on the Department of Water Supply utility plant assets in service is computed using the straight-line method over the estimated useful lives of the assets as follows: Stmctures and improvements 30 to 67 years Machinery and equipment 5 to 20 years Water systems 25 to 50 years Depreciation expense on assets acquired with contributions in aid of construction is charged to contributed capital. The fixed assets of the Department at June 30, 1997 were: Utility plant in service $187,350,199 less: accumulated depreciation (60.550.713) 126,799,486 Construction in progress 11,586,879 Net fixed assets A138.386365 -59- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Long-term Debt The County has issued general obligation bonds on behalf of the Department of Water Supply. The Department is responsible for the payment of the debt service on these bonds, but the County remains liable because they are general obligations of the County. The Department records these bonds as a liability. General obligation bonds payable issued on behalf of the Department at June 30, 1997 are comprised of the following individual issues: Public improvement bonds: 1981 Series A at 5.0%, due through 2016 $ 560,000 1993 Series A at 3.8% to 5.6%, due through 2013 9,265,000 Total public improvement bonds 9,825,000 Public improvement refunding bonds: 1989 Series at 6.2% to 6.95%, due through 2004 3,702.500 Total Department of Water Supply $13.527.500 Annual debt service requirements to maturity for these general obligation bonds, including interest payments of $6,182,321, are as follows: Fiscal Year Department of Ending June 30 Water Suonly 1998 $ 1,611,585 1999 1,582,977 2000 1,549,718 2001 1,519,541 2002 ],492,537 Thereafter 11.953,463 Total $19.709.821 Contributed Capital The following is a summary of contributed capital of the Department for the fiscal year ended June 30, 1997: -60- COUNTY OF HAWAII Notes to the Combined Financial Statements June 30, 1997 Balance Balance July 1, June 30, Additions Deductions Deoartment of Water Suooly: Contributed by County of Hawaii $ 1.132.683 $ - $ $ 1,132.683 Contributions in aid of conswction: Federal govemment 4,958,589 665,529 5,624,118 State of Hawaii 52,567,401 419,812 958,958 52,028,255 County of Hawaii 7,989,009 129,980 8,118,989 Non-govemment 85.796.830 4.252.837 56.273 89.993.394 Total contributions in aid of conswction 151,311,829 5,468,158 1,015,231 155,764,756 Less: accumulated amortization (46.363.297) (3,534.325) (49.897.622) Net contributions in aid of conswction 104.948.532 1.933.833 1.015.231 105.867.134 Contributed capital R106.OAL215 $1.933.833 81.015..31 106.999817 Capital of $1,132,683 contributed by the County to the Department of Water Supply represents utility plant in service transferred from the County to the Department at its inception on January 1, 1950. Commitments and Contingent Liabilities Claims and judgments - The Department is self-insured for workers' compensation and other perils. The liability at June 3Q 1997 for workers' compensation claims of $170,000 was estimated based on a combination of case-by-case review and the application of historical experience. Construction contracts -The Department is obligated under constction contracts for the utility plant and other projects. Such commitments approximated $4,265,084 at June 30, 1997. 61- This page intentionally left blank. -62- n~ i GENERAL FUND ~ The General Fund accdunts for all financial resources exCe~51: those r"equired to be accounked far imanather fund. ''r , i d~,, f COUNTY OF HAWAII General Fund Compazative Balance Sheets ,I one 3601997 and 1996 1222 1996 ASS><iS Cash and investments: Cash and cash equivalents $15,040,738 $10,085,046 Investments 12,533,048 27,420,000 Impress and change funds 25,070 24,970 Total cash and investments 27,598,856 37,530,016 Receivables: Real property taxes Delinquent 12,825,393 11,300,311 Litigated claims 177,975 2,597,589 Total real property tares 13~ 13- 9~~ Due from other governments: State of Hawaii 7,501,207 1,344,858 Federal Government 1,619,895 1,523,453 Total due from other governments 9,1~ 2,8-~11 Due from other funds 2,098,088 1, 8 ,177 Other ~ ,140 Total receivables 24,442,927 18,752,528 Inventories 1,980,213 1,578,775 Total assets $54,021,996 $57,8 (Continued) -63- COUNTY OF HAWAII (Concluded) General Fund Compazative Balance Sheets June 30. 1997 and 1996 1212 12.2fi Liabilities and Fund Balance Liabilities: Warrarns payable $ 2,872,609 $ 2,799,323 Accounts payable 1,258,569 1,245,011 Due to other funds 4,259,591 3,019,570 Due to IRS -arbitrage rebate 136,026 10,596 Deferred revenue: Real property tax revenue 13,242,620 14,133,623 Liquor control revenue 167,570 161,340 fitergovernmentalrevenue 1,055,963 1,388,617 Total deferred revenue 14~ 15, ,5 0 p~ 689,977 , 4 ,626 Total liabilities 23,682,925 26,100,706 Fund balance: Reserved for: Encumbrances 6,958,973 7,428,454 Inventories 1,980,213 1,578,775 Liquor control 225,435 244,875 Total reserved fund balance 9,1 ,621 ,25 ,1 Unreserved: Designated for. Imprest and change funds 25,070 24,970 Drug enforcement 32,354 32,354 Special duty police program 206,235 99,788 Future year 15,800,000 9,415,530 Computer equipment -police and county clerk 1,664,890 County council projects 121,474 Claims and judgments 1,083,048 1,227,689 Total designated fund balance 17,146,7 7 12,586,695 Undesignated 4,027,743 9, 1,814 Total fund balance 30,339,071 31,760,613 Total liabilities and fund balance $54,021,996 $57,861,319 ~ -64- COUNTY OF HAWAII General Fund Comparative Statements of Revenues, Expenditures and Changes in Fund Balances For he Fic I Y rc>~nd d I m 70 1997 and 1996 1222 124fx Revenues: Taxes and assessments $86,489,656 $92,512,151 Licenses and permits 3,150,742 2,965,089 Intergovernmental 35,616,526 33,114,056 Charges for current services 1,698,830 1,549,577 Fines and forfeitures 346,436 665,479 Rents 83,808 37,554 Interest and penalties 4,920,177 3,755,674 Miscellaneous 1,304,017 1,309,690 Total revenues 133,610,192 135,909,270 Expenditures: Current: General government 19,615,104 18,241,053 Public safety 51,569,478 47,829,723 Highways and streets 1,293,013 1,339,420 Sanitation 4,521 179,964 Health, education and welfare 5,002,914 5,204,915 Culture and recreation 10,682,846 10,416,082 Pension and retirement contribution 12,533,069 11,723,783 Health fund 7,923,090 7,526,698 Miscellaneous 2,431,467 2,787,037 Capital outlay 4,458,536 1,748,793 Debt service: Interest and finance charges 13,029 2,412 Principal retirement 19,051 9,189 Total expenditures 115846,1 l8 107,009,069 Excess of revenues over expenditures 18,064,074 28,900,201 Other financing sources (uses): Increase in capital lease obligations 469,210 Sale of general fixed assets 14,598 34,547 Operating transfers in 1,100,223 935,999 Operating transfers out (21,471,085) (20,579,213) Total financing sources (uses) (19,887,054) (19,608,667) Excess (deficiency) of revenues and other sources over expenditures and other uses (1,822,980) 9,291,534 Fund balance, beginning of year 31,760,613 22,204,347 Increase in reserve for inventories 401,438 264,732 Fund balance, end of year $30,3~39,0~71 $31,760,613 -65- COUNTY OF HAWAII General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAP Budgetary Basis For Lhe Fiscat Year Ended line 30. 1997 Variance Favorable Budgie[ ASaadl (Unfavorable) Revenues: Taxes and assessments -real property taxes $85,588,000 $86,489,656 $ 901,656 Licenses and permits: Nonbusiness licenses and permits 2,168,143 2,010,653 (157,490) Business licenses 992,372 884,090 (108,282) Street use 285,000 255,999 (29,001) Total licenses and permits 3,445,515 3,150,742 (294,773) Intergovernmental: Federal: Programs for the aged 1,152,627 1,074,509 (78,118) Community development block grants 4,590,933 4,590,933 Civildefense 125,267 116,750 (8,517) Law enforcement 1,033,219 959,283 (73,936) Other 4,445,516 4,417,506 (28,010) Total Federal 11,347,562 11,158,981 (188,581) State: State General Fund -Act 185, SLH 1990 16,552,000 17,903,935 1,351,935 Emergency medical services 7,293,586 7,069,048 (224,538) Other 3,503,412 2,932,454 (570,958) Child support enforcement 1,083,512 997,421 (86,091) Total State 28,432,510 28,902,858 470,348 Total intergovemmental revenue 39,780,072 4Q,061,839 281,767 Charges for current services: General government 744,430 864,665 120,235 Culture and recreation 375,536 324,802 (50,734) Highways and streets 435,000 494,927 59,927 Public safety 17,800 14,435 (3,365) Total charges for current services 1,572,766 1,698,829 126,063 Fines and forfeitures 766,000 346,437 (419,563) Rents 39,600 83,808 44,208 (Continued) -66- COUNTY OF HAWAII (Continued) General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Non-GAAP Budgetary Basis For Lhe Fisca Year Ended Lune 30. 1997 Variance Favorable Budget Aflual (Unfavorablel Revenues (continued): Interest and penalties 3,400,000 4,864,818 1,464,818 Miscellaneous 2,752,912 2,959,531 206,619 To[alrevenues 137,344,865 139,655,660 2,310,795 Expenditures: Current: General government: Finance 5,664,804 5,102,126 562,678 Automotive equipment 1,826,563 1,642,074 184,489 General government building 2,543,832 2,251,104 292,728 Legislative 2,794,508 2,670,674 123,834 Law 2,435,130 2,217,146 217,984 Planning and zoning 1,501,158 1,091,601 409,557 Research and development 1,493,780 1,412,503 81,277 Mayor's office 922,462 877,671 44,791 Engineering 1,007,813 928,178 79,635 Personnel services 798,995 663,971 135,024 Chief engineer 818,779 707,088 111,691 Elections 471,199 374,919 96,280 Total general govemment 22,279,023 19,939,055 2,339,968 Public safety: Police department 29,442,770 27,470,859 1,971,911 Fire department 16,702,765 16,315,774 386,991 Prosecuting attorney 4,195,230 3,599,224 596,006 Protective inspection 1,584,094 1,544,159 39,935 Liquor control 994,072 704,889 289,183 Flood control 620,720 600,223 20,497 Civil defense agency 455,358 391,769 63,589 Humane Society 604,170 604,170 Safety coordinator 259,288 252,052 7,236 Total public safety 54,858,467 51,483,119 3,375,348 Highways and sVeets: Mass transit 1,147,013 1,146,177 836 Sanitation (118,792) 118,792 (Continued) -67- COUNTY OF HAWAII (Continued) General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For he F's . I Y ar Fnd .d J me 30. 1997 Variance Favorable Budgie[ Ar1La1 (Unfavorable) Expenditures (continued): Current (continued): Health, education and welfare: Office of Aging 1,312,419 1,219,594 92,825 Elderly Activities 2,441,761 2,315,702 126,059 Education 290,000 257,271 32,729 Social programs 900,000 900,000 Cemeteries 199,134 186,420 12,714 Physical examination 96,420 96,420 Total health, education and welfare 5,239,734 4,975,407 264,327 Culture and recreation: Community music 149,410 148,655 755 Organized recreation: Maintenance 4,668,351 4,454,912 213,439 Recreation 1,448,887 1,403,529 45,358 Aquatics 1,759,749 1,569,164 190,585 Hoolulu Park complex 676,749 667,267 9,482 Administration 486,464 473,080 13,384 Children's zoo 553,078 446,630 106,448 Summer fun 381,611 268,965 112,646 Culture and arts 101,896 99,280 2,616 Elderly activities administration 482,611 461,280 21,331 Total culture and recreation 10,708,806 9,992,762 716,044 Pension and retirement contributions 12,588,260 12,533,069 55,191 Health fund 7,945,243 7,923,090 22,153 Miscellaneous 5,958,222 2,354,520 3,603,702 Total current 120,724,768 110,228,407 10,496,361 Capital Outlay -Community Development Block grants (HUD) CDBG 1991 (22,500) (22,500) CDBG 1992 (16,069) (16,069) CDBG 1996 2,436,502 2,436,502 CDBG 1997 2,374,500 2,374,500 Total Community Development Block Grants (HUD) 4,772,433 4,772,433 HOME Program 3,852,000 3,852,Ot7o Total capital outlay 8,624,433 8,624,433 (Continued) -68- u COUNTY OF HAWAII (Concluded) General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For the Ficcal Year Ended June 30 1997 Variance Favorable Budgie[ (Unfavorable) Expenditures (continued): Total expendiures 129,349,201 118,852,840 10,496,361 Excess of revenues over expenditures 7,995,664 20,802,820 12,807,156 Other financing sources (uses): Operating transfers in: Highway Fund 25,000 25,000 Golf Course Fund 135,868 135,868 1978 Sinking Fund 933,501 939,355 5,854 Total operating transfers in 1,094,369 1,100,223 5,854 Operating transfers oul: Sewer Fund 760,390 760,390 SolidWasteFund 8,956,565 6,169,000 2,787,565 Golf Course Fund 359,598 359,598 Capital Projects Fund 560,427 560,427 Debt Service Fund 15,634,345 15,262,586 371,759 Total operating transfers out 26,271,325 23,112,001 3,159,324 Total other financing sources (uses) (25,176,956) (22,011,778) 3,165,178 Excess (deficiency) of budgeted revenues and other sources over budgeted expenditures and other uses: (17,181,292) (1,208,958) 15,972,334 Unbudgeted self-insurance expenditures ($200,000), net of related interest revenue ($55,359) (144,641) (144,641) Fund balance, beginning of year 31,760,613 31,760,613 Fund balance, end of year $ 14,579,321 $30,407,014 $15,827,693 -69- This page intentionally left blank. -70- . ~ o ~ \ i SPECIAL REVENUE FUNDS HIGHWAY FUND - Used; to account for the costs of maintaining the Cou>ty's highways. and streets. Financing is provided primarily by fuel;, motor. vehicle weight and; public utility, franchise taxes: PARKING METER FUND.<;Used to account for the costs of'inaintaining CUunry. on-street and off-8treetparking areas. Financing is piovld'ed by the proceeds from parking meters. SEWER FUND ,Used to account for costs of operagng the bounty's Various sewerage systems: Financing is provided by c}arges to usets for sewer services. a BIKEWAY FUNQ -Used to accumulate moneys for the constzuchor#;of $ikeways within the County. Financing is provided by bicycle license fees. ; CEMETERY.FUN17 Used taaccumulate moneystq guatante~ kite tttitr~t~aiiltenahce off, ; Coiinty~eemetery sltes~ FirldZcing is provided fro#n the salt o~ituxial i4 in ~OlkY7k}!,;em~ter~es~ m~ .y, . VE~IICLE DISPOSAL FUND -Used to accumulate moneys ~or the ktlwiXtgR remoVai, disposal -and recycling o f abandoned' or discarded automobiles and auttsmoliile patty Financing i5 ' provided byarmual fees collected with motor vehicle registrations. ~ SOLID .WASTE 1: UND -Used to accumulate moneys for tho operations maintenance, and' administration of the County's solid waste manaSement, colleCHon, and disposai_ systems; Financing is provided by tipliing fees at the landfills and by., disposal pemUC fees. ' GOLF COURSE FUND -Used to accountfor the cost of operating the Hilo Municipal Golf Course. Funding is provided from green fees and payments from restaurant and pro shop concessionaires. GEOTHERMAL ROYALTY FUND -Used to accumulate the County'ashare of geothermal • resource royalties received from the opetator of a geothermal power plant located in the County: The funds are earmarked far a geothermal reloeaHon progtatn. BEAUTIFICATION FUNTI -Used to accumulate moneys for the beautification of highways and disposal of aiiandoned vehicles within the County, Finan~liig is providgii, by assessments on vehicle registrations. This page intentionally left blank. -71- COUNTY OF HAWAII Special Revenue Funds Combining Balance Sheet at June 30, 1997 (With comoar+ ive totalc for Tune 30- 19961 Parking Vehicle Highway Meter Sewer Bikeway Cemetery Disposal Eund Elln>i Eund F.uud Etnd Eutld Assets Cash and cash equivalents $4,889,801 $57,340 $1,724,811 $22,158 $17,400 $736,027 Impress fund Receivables: Waste disposal charges receivable 945,666 Intergovernmental: Due from Stale government 5,241 Due from Federal govemment Total due from other governments S,7A1 Duefrom other funds 86 Other receivables 841 32,308 Total receivables 5,241 927 977,974 Total assets $4,895,042 $58,267 $2,702,785 $22,158 $17,400 $736,027 i iabilitiec and Fund Balaneec Liabilities: Warrants payable $ 235,702 $ 953 $ 95,161 $ $ $133,606 Accounts payable 100,831 28,539 1,206 Due to other funds 865,469 15,185 200,799 4,482 Deferred revenue 125,000 945,666 Total liabilities 1,327,002 16,138 1,270,165 139,294 Fund balances: Reserved for encumbrances 366,548 3,728 173,946 183,293 Unreserved: Designated for equipment replacement 1,106,775 Designated for council projects Designated for impress fund Designated for future years 2,288,857 34,000 151,899 10,000 Designated for future project 1,000 Total designated fund balance 2,289,857 34,000 1,258,674 10,000 Undesignated 911,635 4,401 12,158 17,400 413,440 Total fund balances 3,568,040 42,129 1,432,620 22,158 17,400 596,733 Total liabilities and fund balances $4,895,042 $58,267 $2,702,785 $22,158 $17,400 $736,027 ~ ~ -72- Solid Golf Geothermal Beau[i- Totals Was[e Course Royalty fication Elluii Eund Filntl Ell¢d 1222 122fx $1,206,132 $280,508 $505,107 $199,251 $9,638,535 $9,323,187 2,000 2,000 2,000 896,702 1,842,368 1,720,705 5,241 87,082 50,924 5,241 138,006 488,347 305 488,738 59,595 66,325 330 99,804 664,848 1,451,374 330 305 2,436,151 2,583,154 $2,657,506 $282,838 $505,412 $199,251 $12,076,686 $11,908,341 $ 256,287 $ 6,741 $ $ 1,161 $ 729,611 $ 619,183 335,085 3,514 1,065 470,240 605,150 236,713 65,887 2,035 1,390,570 1,184,024 918,817 1,989,483 1,720,705 1,746,902 76,142 2,035 2,226 4,579,904 4,129,062 410,296 41,886 35,000 1,214,697 2,686,387 1,106,775 $99,031 40,479 2,000 2,000 2,000 498,000 79,496 3,062,252 445,000 1,000 1,000 498,000 81,496 4,172,027 1,387,510 2,308 83,314 468,377 197,025 2,110,058 3,705,382 910,604 206,696 503,377 197,025 7,496,782 7,779,279 $2,657,506 $282,838 $505,412 $199,251 $12,076,686 $11,908,341 ~ -73- COUNTY OF HAWAII Special Revenue Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Fiscal Year Ended June 30, 1997 ^'Jith cmm~ara[ive totals for the Etccal y . * nd n J m . ~0. 1996) Parlung Vehicle Highway Meter Sewer Bikeway Cemetery Disposal FJlll~ Fl1Rd I?ilnd FLlld FL¢!1 Fylld Revenues: Taxes $ 9,634,476 $ $ $ $ $ Licenses and permits 2,388,545 18,746 452,275 Intergovernmental 213,799 (7.677) Charges for current services 104,843 123,043 2,530,800 140 Miscellaneous 72,180 25 5,139 7,600 154 Total revenues 12,413,843 123,068 2,535,939 11,069 7,600 452,569 Expenditures: Current General government Public safety 2,668,810 151,352 Highways and streets 5,625,892 12,000 Sanitation 3,057,751 352,823 Health, education & welfare 3,988 Culture and recreation Pension and retirement contributions 946,147 23,221 335,140 6,728 Health fund 406,780 8,926 129,854 1,209 Miscellaneous 326,022 74,198 Deb[ service: Interest charges Principal retirement Total expenditures 9,977,639 183,499 3,596,943 12,000 360,760 Excess (deficiency) of revenues over expenditures 2,436,204 (60,431) (1,061,804) (931) 7,600 91,809 Other financing sources (uses): Operating transfers in: General Fund 760,390 Operating transfers out: General Fund (25,000) Public Improvement Bond Fund (2,497,557) Total other financing sources (uses) (2,522,557) 760,390 Excess (deficiency) of revenues and other sources over expenditures and other uses (86,353) (60,431) (300,614) (931) 7,600 91,809 Fund balances, beginning of yeaz 3,654,393 102,560 1,733,234 23,089 9,800 504,924 Fund balances, end of year $ 3,568,040 $42,129 $1,432,620 $22,158 $1~ $596,733 -74- Solid Golf Geothermal Beauti- Totals Waste Cotuse Royalty fica[ion Fund Fund Eund Euud 1422 1996 $ $ $ $ $ 9,634,476 $ 9,242,838 113,199 2,972,765 2,870,993 193,886 400,008 542,163 2,532,979 805,200 6,097,005 6,482,513 21,373 9,021 159,036 274528 486,933 2,748,238 814,221 159,036 113,199 19,378,782 19,625,440 3,007 3,007 2,820,162 2,551,657 52,543 5,690,435 4,897,135 8,301,927 ] 1,712,501 10,270,752 3,988 5,633 779,004 779,004 668,454 339,807 110,617 718 1,762,378 1,602,225 170,030 47,831 127 764,757 724,306 113,739 1,192 515,151 454,003 18,892 18,892 50,764 221,567 221,567 597,437 9,165,962 938,644 3,852 52,543 24,291,842 21,822,366 (6,417,724) (124,423) 155,184 60,656 (4,913,060) (2,196,926) 6,169,000 359,598 7,288,988 7,854,315 (135,868) (160,868) (2,497,557) (2,725,853) 6,169,000 223,730 4,630,563 5,128,462 (248,724) 99,307 155,184 60,656 (282,497) 2,931,536 1,159,328 107,389 348,193 136,369 7,779,279 4,847,743 $9 $206,696 $503,377 $ 197,025 7,4 $ 7,779,279 -75- COUNTY OF HAWAII Special Revenue Funds Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Non-GAAPButigetary Basis For he Fis t Y ar Fnded 7 me 30. 1997 Parking Meter Highway Fund Fund Sewer Fund Bud¢et Actual ~.ttdC>'<1 Aclu3l ] Ada t Actual Revenues: Taxes $9,275,000 $9,634,477 $ $ $ $ Licenses and permits 2,700,000 2,388,545 Intergovernmental 215,000 213,799 Charges for current services 200,000 104,843 151,600 123,042 3,328,180 2,530,800 Miscellaneous 37,000 72,180 25 100 5,139 Total revenues 12,427,000 12,413,844 151,600 123,067 3,328,280 2,535,939 Expenditures: Current: General government Public safety 2,491,060 2,219,455 130,980 109,990 Highways and streets 5,581,092 4,847,820 Sanitation 3,296,263 2,952,466 Health, education & welfare 6,000 3,988 Culture and recreation Pension and retirement contributions 1,085,420 946,147 23,221 23,221 336,038 335,140 Health fund 406,780 406,780 8,926 8,926 129,854 129,854 Miscellaneous 656,648 323,025 473 483,271 77,143 Total expenditures 10,227,000 8,747,215 163,600 142,137 4,245,426 3,494,603 Excess (deficiency) of revenues over expenditures 2,200,000 3,666,629 (12,000) (19,070) (917,146) (958,664) Other financing sources (uses): Operating trans[ers in 760,390 760,390 Operating transfers out (2,625,000) (2,522,557) Total other financing sources (uses) (2,625,000) (2,522,557) 760,390 760,390 Excess (deficiency) of revenues and other sources overexpendi[uresandotheruses (425,000) 1,144,072 (12,000) (19,070) (156,756) (198,274) Fund balance, beginning of yeaz 3,654,393 3,654,393 102,560 102560 1,733,234 1,733,234 Fund balance, end of year $3,2~ 29~ $4,798,465 $9 $83,490 $1,5~ 7i $I,S -76- Bikeway Fund Cemetery Fund Vehicle Disposal Fund Solid Waste Fund Golf Course Fund HudEet Actual ~udfet Actual H11dEet Actttal Hudcst Actual Bud¢et Actual 24,000 18,747 436,050 452,276 12,000 4,322 216,000 216,000 500 140 3,005,250 2,532,979 816,025 805,200 7,600 500 154 21,373 9,022 36,000 23,069 7,600 437,050 452570 3,221,250 2,770,352 816,025 814,222 36,000 24.000 673,094 524,142 11,349,672 8,245,852 849,975 794,984 6,737 6,728 380,143 339,807 110,618 110,618 1,219 1,209 206,000 170,030 47,831 47,831 6,000 242,000 115,235 31,331 1,206 36,000 24,000 687,050 532,079 12,177,815 8,870,924 1,039,755 954,639 (931) 7,600 (250,000) (79,509) (8,956,565) (6,100,572) (223,730) (140,417) 8,956,565 6,169,000 359,598 359,598 (135,868) (135,868) 8,956,565 6,169,000 223,730 223,730 (931) 7,600 (250,000) (79,509) 68,428 83,313 23,089 23,089 9,800 9,800 504,924 504,924 1,159,328 1,159,328 107,389 107,389 $23,089 $22,158 $9,800 $17,400 $254,924 $425,415 $1,159,328 $1,227,756 $107,389 $190,702 (Continued) _77_ COUNTY OF HAWAII Special Revenue Funds Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Non-GAAPBudgatary Basis Fnr the Fiscal Year Ended Tune 30- 1997 (Concluded) Total S cial Revenue Funds Geothermal ariance Royalty Fund Beautification Fund Favorable ~yQ~ Al~illal Budget ~j (Unfavorable) Revenues: Taxes $ $ $ $ $9,275,000 $9,634,477 $359,477 Licenses and permits 112,000 113,199 3,272,050 2,972,767 (299,283) In[ergovemmental 443,000 434,121 (8,879) Charges for current services 7,501,555 6,097,004 (1,404,551) Miscellaneous 148,000 159,036 185,600 274,529 88,929 Total revenues 148,000 159,036 112,000 113,199 20,677,205 19,412,898 (],264,307) Expenditures: Curren[: General government 493,482 38,007 493,482 38,007 455,475 Public safety 2,622,040 2,329,445 292,595 Highways and streets 112,000 48,754 5,729,092 4,920,574 808,518 Sanitation 15,319,029 11,722,460 3,596,569 Health, education & welfare 6,000 3,988 2,0]2 Culture and recreation 849,975 794,984 54,991 Pension and retirement contributions 1,439 718 1,943,616 1,762,379 181,237 Health fund 1,272 127 801,882 764,757 37,125 Miscellaneous 1,419,723 516,609 903,114 Total expenditures 496,193 38,852 112,000 48,754 29,184,839 22,853,203 6,331,636 Excess (deficiency) of revenues over expenditures (348,193) 120,184 64,445 (8,507,634) (3,440,305) 5,067,329 Other financing sources (uses): Operating transfers in 10,076,553 7,288,988 (2,787,565) Operating transfers out (2,760,868) (2,658,425) 102,443 Total other financing sources (uses) 7,315,685 4,630,563 (2,685,122) Excess (deficiency) of revenues and other sources over expenditures and other uses (348,193) 120,184 64,445 (1,191,949) 1,190,258 2,382,207 Fund balance, beginning of year 348,193 348,193 136,369 136,369 7,779,279 7,779,279 Fund balance, end of year $ $46~ $13 $200,814 $6,5 $8,969,537 $2,382,207 _78_ COUNTY OF HAWAII Highway Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For he Fic 1 Y ar .nded ? me 30. 1997 Vaziance Favorable Budeet As:lllal (Unfavorable) Revenues: Taxes: Fuel tax $ 5,950,000 $ 5,783,674 ($166,326) Public utility franchise tax 3,325,000 3,850,803 525,803 Total taxes 9~ 9, ,477 Licenses and permits -motor vehicle weight taxes 2,700,000 2,388,545 (311,455) Intergovernmental 215,000 213,799 (1,201) Charges for current services 200,000 104,843 (95,157) Miscellaneous 37,000 72,180 35,180 Total revenues 12,427,000 12,413,844 (13,156) Expenditures: Public safety - Uaffic engineering 2,491,060 2,219,455 271,605 Highways and streets 5,581,092 4,847,820 733,272 Health, education & welfare 6,000 3,988 2,012 Pension and retirement contributions 1,085,420 946,147 139,273 Health fund 406,780 406,780 Miscellaneous 656,648 323,025 333,623 Total expenditures 10,227,000 8,747,215 1,479,785 Excess of revenues over expenditures 2,200,000 3,666,629 1,466,629 Other financing uses - Operating Vansfers out - General Fund (25,000) (25,000) Capital Projects Fund (2,600,000) (2,497,557) 102,443 Total other financing uses (2,625,000) (2,522,557) 102,443 Excess (deficiency) of revenues over expenditures and olheruses (425,000) 1,144,072 1,569,072 Fund balance, beginning of year 3,654,393 3,654,393 Fund balance, end of year $ 3,229,393 $ 4,798,465 $1,569,072 -79- COUNTY OF HAWAII Parking Meter Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAP Budgetary Basis For Lhe Fiscal Year F.nded June 30. 1997 Variance Favorable $Ldp.Ct A~31 fUnfavorablel Revenues: Chazges for cazrent services -highways and streets $151,600 $123,042 ($28,558) Miscellaneous 25 25 Total revenues 151,600 123,067 (28,533) Expenditures: Public safety - pazking 130,980 109,990 20,990 Pension and retirement contributions 23,221 23,221 Health fund 8,926 8,926 Miscellaneous 473 473 Total expenditures 163,600 142,137 21,463 Excess (deficiency) of revenues over expenditures (12,000) (19,070) (7,070) Fund balance, beginning of yeaz 102,560 102,560 Fund balance, end of yeaz $90,560 $83,490 ($7,070) -80- COUNTY OF HAWAII Sewer Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBudgecary Basis For h Fic I Y ar Fnd d I ~n 30 1997 Variance Favorable Budeet ALL13l (Unfavorable) Revenues: Charges for current services -sewer fees $3,328,180 $2,530,800 ($797,380) Miscellaneous 100 5,139 5,039 Total revenues 3,328,280 2,535,939 (792,341) Expenditures: Sanitation 3,296,263 2,952,466 343,797 Pension and retirement contributions 336,038 335,140 898 Heallh fund 129,854 ]29,854 Miscellaneous 483,271 77,143 406,128 Total expenditures 4,245,426 3,494,603 750,823 Excess (deficiency) of revenues over expenditures (917,146) (958,664) (41,518) Other financing sources - Operating Vansfers in -General Fund 760,390 760,390 Total other financing sources 760,390 760,390 Excess (deficiency) of revenues and other sources over expenditures (156,756) (198,274) (41,518) Fund balance, beginning of year 1,733,234 1,733,234 Fund balance, end of year $1,576,478 $1,534,960 ($41,518) -81- COUNTY OF HAWAII Bikeway Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For h F's 1 Ye r Fnd d) ~n 30. 1997 Variance Favorable Budee[ (Unfavomblel Revenues: Licenses and permits -bicycle [ax $24,000 $18,747 ($5,253) Intergovernmental 12,000 4,322 (7,678) Total revenues 36,000 23,069 (12,931) Expenditures -highways and sVeets 36,000 24,000 12,000 Excess (deficiency) of revenues over expenditures (931) (931) Fund balance, beginning of year 23,089 23,089 Fund balance, end of year $ 23,089 $22,158 ($931) -82- COUNTY OF HAWAII Cemetery Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For h Fic t Ye r Fnded June 40 1997 Vaziance Favorable ~t (~Tnfavorablel Revenues -miscellaneous -sale of cemetery plots $ $ 7,600 $7,600 Fund balance, beginning of year 9,800 9,800 Fund balance, end of yeaz $9,800 $17,400 $7,600 -83- COUNTY OF HAWAII Vehicle Disposal Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For he F's I Y r .nd a 7 m. 0. 1997 Vaziance Favorable Bud¢et ~sil (Unfavorable) Revenues: Licenses and permits- vehicle disposal fee $436,050 $452,276 $ 16,226 Charges for services -towing charges 500 140 (360) Miscellaneous 500 154 (346) Tolalrevenues 437,050 452,570 15,520 Expenditures: Sanitation 673,094 524,142 148,952 Pension and retirement contributions 6,737 6,728 9 Health fund 1,219 1,209 10 Miscellaneous 6,000 6,000 Total expenditures 687,050 532,079 154,971 Excess (deficiency) of revenues over expenditures (250,000) (79,509) 170,491 Fund balance, beginning of year 504,924 504,924 Fund balance, end of year $254,924 $425,415 $170,491 -84- COUNTY OF HAWAII Solid Waste Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For h Fis 1 Y r Fnded Jnne 30 1997 Variance Favorable udeet (Unfavorafilel Revenues: Charges for services -tipping fees $3,OOS,250 $2,532,979 ($472,271) Intergovernmental 216,000 216,000 Miscellaneous 21,373 21,373 Total revenues 3,221,250 2,770,352 (450,898) Expenditures: Sanitation 11,349,672 8,245,852 3,103,820 Pension and retirement contributions 380,143 339,807 40,336 Health fund 206,000 170,030 35,970 Miscellaneous 242,000 115,235- 126,765 To[alexpenditures 12,177,815 8,870,924 3,306,891 Excess (deficiency) of revenues over expenditures (8,956,565) (6,100,572) 2,855,993 Other financing sources- Operating Vansfers in -General Fund 8,956,S6S 6,169,000 (2,787,S6S) Excess (deficiency) of revenues and other sources over expenditures 68,428 68,428 Fund balance, beginning of year 1,159,328 1,159,328 Fund balance, end of year $1,159,328 $1,227,756 $68,428 -85- COUNTY OF HAWAII Golf Course Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAP Budgetary Basis For h F' I Y r Rnded I me 30. 1997 Variance Favorable Budgie[ 0Gjt731 (Unfavorable) Revenues: Charges for services $816,025 $805,200 ($10,825) Miscellaneous revenue 9,022 9,022 Total revenues 816,025 814,222 (1,803) Expenditures: Culture and recreation 849,975 794,984 54,991 Pension and retirement contributions 110,618 110,618 Health fund 47,831 47,831 Miscellaneous 31,331 1,206 30,125 Total expenditures 1,039,755 954,639 85,116 Excess (deficiency) of revenues over expenditures (223,730) (140,417) 83,313 Other financing sources (uses) - Operating transfers in -General Fund 359,598 359,598 Operating transfers out -General Fund (135,868) (135,868) Total other financing sources (uses) 223,730 223,730 Excess (deficiency) of revenues and other sources over expenditures and other uses 83,313 83,313 Fund balance,beginning of year 107,389 107,389 Fund balance, end of year $ 107,389 $ 190,702 $83,313 -86- COUNTY OF HAWAII Geothermal Royalty Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For h Fisc I Y r Fnd d J me 30. 1997 Variance Favorable B.~liY!<t ACl<tal (Unfavorable) Revenues -miscellaneous -geothermal royalties $148,000 $159,036 $11,036 Expenditures: General government 493,482 38,007 455,475 Pension and retirement contributions 1,439 718 721 Health fund 1,272 127 1,145 Total expenditures 496,193 38,852 457,341 Excess (deficiency) of revenues over expenditures (348,193) 120,184 468,377 Fund balance,~eginning of year 348,193 348,193 Fund balance, end of yeaz $ $468,377 $468,377 -87- COUNTY OF HAWAII Beautification Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For h. Fisc I Y r F.nd .d I m 30. 1997 Vaziance Favorable Budeet A ,a1 fUnfavorablel Revenues: Licenses and permits -highway beautification $112,000 $113,199 $ 1,199 Total revenues 112,000 113,199 1,199 Expenditures: Highways and streets 112,000 48,754 63,246 Total expenditures 112,000 48,754 63,246 Excess (deficiency) of revenues over expenditures 64,445 64,445 Fund balance, beginning of yeaz 136,369 136,369 Fund balance, end of yeaz $136,369 $200,814 $64,445 _gg_ I ' ~ ~ - DEBT SERVICE FUNDS INT~~R£5T ~'tXND - Used to accumulate moneys for paymez4t o£intet~st ori` generaiobligation bonds: Moneys required to sel'vice ntt~i~as~ maturlkiea aye tran~fered annually~froiii the General.Fund. ~ „ BOND REDEMPTIOI~`FUND -Used to' accumulate nnoney~'for the 1978 Sinkiing a ~ Fund acid for paymer+k'of general obligation bonds: Moite~!3 requited to retie ' the bonds and service:the Sinking 1~und are transferred frost, tl~e General,F~nd , `a, `:oxtege~i`lnadvanceofmaturity:' ~ ~ ~ . _s u~ ' 198 Sl`NIUNO FUATD -Used to accumulate moneys for a at~tlcmg fund fQr~ ttie 158 S,~rles general abfigatiorrbonds. Corrtributier"ns to th~Stnkirrg BundE whuh - are determined by the-,bond ordinance;`are transferred fro~lalt~ $oxtd Redemption 1~und on #established due. dates. 1, l r COUNTY OF HAWAII Debt Service Funds Combining Balance Sheet at June 30, 1997 ryy'rh romn ra iy to alc for t roe 0 1996) General Obligation Bonds Bond 1978 Totals Interest Redemption Sinking EWId Eund Eyed 1922 1996 ASS~tS Cash and investments: Cash and cash equivalents $ $1,061,345 $ $ 1,061,345 $ 664,307 Investments 417,652 6,521,991 11,186,613 18,126,256 18,245,367 Totalasse[s $417,652 $7,583,336 $11,186,613 $19,187,601 $18,909,674 Liabilities and F and B t n c Liabilities: Accrued interest payable $137,528 $ $ $ 137,528 $ 133,744 Bonds payable 340,150 340,150 105,300 Total liabilities 137,528 340,150 477,678 239,044 Fund balances: Reserved for deb[ service - redemption of bonds and interest thereon 280,124 7,243,186 11,186,613 18,709,923 18,670,630 Total liabilities and fund balances $417,652 $7,583,336 $11,186,613 $19,187,601 $18,909,674 _gg_ COUNTY OF HAWAII Debt Service Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Fiscal Year Ended June 30, 1997 (With comnarati~r to alc for th fic I y r nd d J me 30- 19961 General Obligation Bonds Bond 1978 Totals Interest Redemption Sinking Fyntl Fund Fund 1242 1996 Revenues -interest $ $ $ 939,355 $ 939,355 $ 935,999 Expendittres: Interest chazges 7,597,938 7,597,938 6,067,081 Principal retirement 5,984,439 5,984,439 5,327,414 Total expenditures 7,597,938 5,984,439 13,582,377 11,394,495 Excess (deficiency) of revenues over expenditures (7,597,938) (5,984,439) 939,355 (12,643,022) (10,458,496) Other fifinancing sources (uses): Operating transfers in - General Fund 7,559,315 6,062,355 13,621,670 12,603,314 Interest Fund 52,673 Operating transfers out - General Fund (939,355) (939,355) (935,999) Bond Redemption Fund (52,674) Total other financing sources (uses) 7,559,315 6,062,355 (939,355) 12,682,315 11,667,314 Excess (deficiency) of revenues and other sources over expenditures and other uses (38,623) 77,916 39,293 1,208,818 Fund balances, beginning of year 318,747 7,165,270 11,186,613 18,670,630 17,461,812 Fund balances, end of year 2 $7,243,186 $11,186,613 $18,709,923 $18,670,630 -90- • j r r. ~APTTAL ~RC~j~~TS k"t.TND~, ~~a CAPITAL PROJ~GT5 FUND =Used to account for°,-the costs:of c4ttstrtze , County°capital f~%prot!el~nents:financedrrvith gener~I~ oblig~t;or~~r~„ ~ oe~l~, _ ~ ~ ~~fedei~sl~and state'~ran~s; and_''general andsspecial P~yen~e~ fi~rid ~eV~'u~s , F IMPROVEMENT DI57"RICT Nt?. 16 -Used to account fort tkie costs of constrgCtion of improve'nnenks in Improvement DistrtctNo,; iGt~~atit# ~ u~ Agricu~}ural hots Su$,iVisign. "Thd improyernen#~were firis~i~~ ~ eh~~,; ' proceed's of the safe of~~~?e+~ial assessment+bond~ ~ ~ , ~d t ,a ~ - „ k f ~ ~ ~ r ~ , ~ r -.i; ~ , _ f. 3 t IMPROVEMENT I71ST'ItICT NO: 17 -Used to account for the costs of ' construction of improvements in Improvement District No: 17r ICalokp , Subdlvisioq. The imp#dvements were financed "With_,khe'proeeedS of ~e salg pf, j special assessment bonds: i { COUNTY OF HAWAII Capital Projects Funds Combining Balance Sheet at June 30, 1997 ith n p native o alc for June 70- 19961 Capital Improvement Improvement Totals Projects District District Fund No. 16 No. 17 1922 199fa As~,gtc Cash and investments: Cash and cash equivalents $ 2,665,546 $211,772 $821,840 $ 3,699,158 $1,842,421 Investments 37,500,000 37,500,000 49,000,000 Total cash andinvestmen[s 40,165,546 211,772 821,840 41,199,158 50,842,421 Receivables: Due from other governments - State of Hawaii: Construction grants 197,920 197,920 1,655,772 Federal Government 3,352,913 3,352,913 1,298,512 Total due from other governments 33-55~- 3~ ,954,284 Due from other funds 571,792 571,792 202,495 Private contributions receivable 2,015 2,015 2,015 Other receivables 153 Total receivables 4,124,640 4,124,640 3,158,947 Restricted cash and cash equivalents 218,519 218,519 667,743 Total assets $44,508,705 $211,772 $821,840 $45,542,317 $54,669,111 ~ ~ Liabilities and Fund Balances Liabilities: Warrants payable $ 1,021,680 $ $ 4,537 $ 1,026,217 $ 1,645,258 Accounts payable 553,712 553,712 1,065,756 Due [o other funds 102 102 345 Deferred intergovernmental revenue 188,267 188,267 352,852 Other 171,466 171,466 631,725 Total liabilities 1,935,227 4,537 1,939,764 3,695,936 Fund balances: Reserved for: Encumbrances 6,843,920 9,153 6,853,073 13,206,936 Unexpended allotments 14,818,235 211,772 807,079 15,837,086 23,978,760 Total reserved fund balance 21~ ~ 8~ 2- 69~ 7 Unreserved: Designated for road repairs 6,101,662 6,101,662 2,464,031 Designated for SRF projects 66,750 66,750 887,355 Total designated fund balance 6,16~~ 6,168,412 ~51,3~6 Undesignated 14,74 ,911 1,071 14,74 ,9 10 43~i Total fund balances 42,573,478 211,772 817,303 43,602,553 50,973,175 Total liabilities and fund balances $44,508,705 $211,772 $821,840 $45,542,317 $54,669,111 ~ ~ ~ ~ -91- COUNTY OF HAWAII Capital Projects Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Fiscal Year Ended June 30, 1997 (}~jrh comparative tot?I¢ for the fiscal ygar end d T me'i0 19961 Capital Improvement Improvement Totals Projects District District Fund No. 16 Igo- 17 1222 122ft Revenues: Intergovernmental $ 7,691,536 $ $ $ 7,691,536 $ 2,035,355 Interest 11,035 11,035 28,060 Miscellaneous: Developer's contributions 204,348 204,348 35,966 Other 5,670 5,670 Total revenues 7,912,589 7,912,589 2,099,381 Expenditures: General government 6,6]2,542 6,612,542 182,614 Public safety 2,662,597 2,662,597 2,795,928 Highways and streets 6,688,724 31,513 6,720,237 4,476,266 Sanitation 9,096,965 9,096,965 9,105,302 Culture and recreation 5,339,131 5,339,131 2,237,350 Miscellaneous 26,953 26,953 18,946 Total expenditures 30,426,912 31,513 30,458,425 18,816,406 Excess (deficiency) of revenues over expenditures (22,514,323) (31,513) (22,545,836) (16,717,025) Other financing sources: State Revolving Fund (SRF) loans 7,320,355 7,320,355 5,307,656 Federal loans 4,772,500 4,772,500 15,000 Proceeds from sale of bonds (1996 Series A) 15,098 15,098 29,913,152 Operating transfers in: General Fund 560,427 560,427 Cemetery Fund 212,690 Park Dedication Fund 9,277 9,277 Highway Fund 2,497,557 2,497,557 2,513,163 Total other financing sources 15,175,214 15,175,214 37,961,661 Excess (deficiency) of revenues and other sources over expenditures (7,339,109) (31,513) (7,370,622) 21,244,636 Fund balances, beginning of year 49,912,587 211,772 848,816 50,973,175 29,728,539 Fund balances, end of year $42,573,478 $2 $817,303 $43 $50,973,175 -92- Capital Projects Fund Schedule of Appropriations, Expenditures and Encumbrances - Non-GAAPBudgatary Basis For he Ficcal_ Year Fnd d 7 to 40 1997 Authorizations 1996 Encumbrances Lapsed Pmiett Title Forwarded Appropriations Zpdal Fxo ndi ~ ~ FnFn r"ymbrances @alaa£Ca Public Safety: Fire: Paredise Park Volunteer Fire Station S 4,930 $ S 4,930 $ 4,930 $ S HPPVolunreerFireStationWarer 1.000,000 1,000,000 1,000,000 Fire Maintenance Shop Extension 23,334 23,334 19,950 3,384 Wa&oloa Fire Station 1,093,300 1,093,300 226,395 866,905 Keauhou FirelEmergency Station 1,460,324 1,460,324 1,397,645 62,679 WailroloaFireStation 112,000 112,000 36,328 75,672 Waimea/Central Fire Station Retrofit 62,500 62,500 - 62,500 Total Fire 3,644,388 112,000 3,756,388 1,685,248 2,008,640 62,500 Police: Police Air Duct Removal 500,000 500,000 20,155 479,845 Islandwide Communication Tower Replacement 315,000 315,000 315,000 Kona Police Station Cas Pump .5,387 5,387 - 5,387 Total Police 820,367 - 820,367 20,155 794,845 5,387 Flood Control: Alenaio Stream Flood Control $1,500,000 1,500,000 372,675 1,127,325 Palei Stream Interceptor 300,000 30D,C00 300,000 Manaolana Place Drainage 250,000 250,000 212,197 37,803 Kukuau-Kapiolani Drainage 249,277 249,277 9,928 239,349 Mauna Iho Drainage Improvements 155,000 155,000 110,592 44,408 Lahi Street Drainage 121,092 121,092 118,443 2,649 North Kona Dminage Improvements 100,000 100,000 45,220 54,780 East Hawaii Drywall Improvements 79,950 79,950 46,098 10,277 23,575 West Hawaii Drywall Improvements 100,000 100.000 100,000 Total Flood Control 1,355,319 1,500.000 2,655,319 915,153 1,476,139 464,027 Total Public Safety 5,820,094 1,612,000 7,432,094 2,620,556 4,279,624 531,914 Highways and Streets: Old Volcano RoadNolcano Village 44,649 44,649 14,835 29,814 Puna Raad Improvements -Federal Funds 227,734 227,734 227J34 Puna Highway Safety Improvements 9.000 9,000 9.000 Puna Emergency Access Road 17,546 945,000 962,546 33,515 1,682 927,349 Puna Highway/1'raffic Division Projects 88,197 88,197 66,211 L986 Old Volcano Roed 34,698 (34,698) South Kopua Road 200,000 34,698 234,698 225,050 9,648 Puna Highway/fraffic Division Projecu ]05585 105,585 13,005 92,580 - South Kopua Road 100,000 100,000 86,981 13,019 - Old Volcano Road -Private 8,060 8,060 8,060 Iwalani Street Resurfacing -Federal funds 25,419 25,419 25,419 Manono Street-Kekuanaoa Street Signals 16,381 16,381 16,381 Kekuenaoa/Manono Trek Signal 77,968 77,968 - 77,968 Hilo Road Improvements -Federal Funds 1,038,252 1,038,252 1,038,252 South Hilo Highway Safety 56,443 56,443 (7,924) 37,120 27,247 (Continued) -93- Capital Projects Fund Schedule of Appropriations, Expenditures and Encumbrances - Non-GAAP Budgetary Basis For Lhr Ficcal Ye ~ nd d ] m 0 1997 (Continued) Authorizations 1996 Encumbrances Lapsed Plpjen Tile EpL1YHlflfdl Appropriations Tora1 F^oenditurea Encumbrances $g~ppga Highways end Streets, continued; Mohouli Extension -Federal Funds 3,586,900 3,586,900 3,586,900 MohouliExtension-County Fmds 653,137 653,137 179,607 246,129 227,401 Hilo Road Lnprovanenta Phase 2 -Federal Funds 2,491,361 2,491,361 1,836,052 655,309 Hilo Road Lnprovemrnts Paase 2 -County Funds 198,012 198,012 185,825 12,187 South Hilo Highwayq'nffic Division Projects 454,714 454,714 203,974 SI,483 199,257 Hilo Ronda Posu II 435,700 70,000 505,700 340,773 67,624 9703 Kinney Heights Subdivision 15,611 15,81 l 1,766 14,045 Ululani Street 2.692 2,692 2,692 KaumanaDriveWalVGuerdrail 65,000 65,000 65,000 Haaheo School Sidewalks 281,713 281,713 41,563 240,150 Komohana-Mohouli Traffic Signal -Federal Funds 549,990 549,990 393,714 156,276 - Ainaole-Haihai Traffic Signal -Federal Funds 149,564 149,564 119,521 30,043 South Hila Highway/Treffic Division Projects 273,832 273,832 93,683 180,149 Lanikaula-Manrno Traffic Signal -County Funds 250,000 250,000 35,928 214,072 Lanikaula-Manono Traffic Signal -Federal Funds 565,000 565,000 565,000 Komohane Bridge -Federal Funds 240,000 240,000 240,000 - Komohana Bridge -County Funds 60,000 60,000 60,000 Kaahakini Bridge -Federal Funds 588,000 588,000 588,000 Kaahakini Bridge -County Funds 147,000 147,000 147,000 - Reeds Island Bridge - Federal Funds 2,016,000 2,016,000 15,334 2,000,666 Reeds Island Bridge -County Funds 504,000 504,000 404 503,596 Mohouli Street Improvements 375,000 375,000 375,000 Kawailani/Pohakulani/Ainaola/lwalani Streets 250,000 250,000 250,000 - Haaheo School Sidewalk Improvements 165,000 165,000 8,650 156,350 Kaumana/Ainako Signal -Federal Funds 550,000 550,000 3,409 546,591 Honomu/Mamalahoa Bridge -Fedeml Funds 124.000 124,000 124.000 - Kalaoa/MamalahoaBridge -Fedeml Funds 108,000 108,000 108,000 Onomea Camp Road Bridge -Federal Funds 72.000 72.000 72,000 - HiloRoad Lnprovemenls Posse III -Federal Funds 65,984 65,984 8 65,976 Komohana/Ponahawai Signal -Federal Funds 2,015,000 2,015,000 3,245 2,011,755 Hamakua Road Upgrade 500.000 (250,000) 250,000 250,000 Noah Hilo Highway/I-reffic Division Projects 82,064 62,064 (336) - 82,400 Hamakua Highway/Trafl;c Division Projects 165,227 185,227 179,254 5,973 North Hilo Highway/1-raffic Division Projects 24,472 24,472 24,472 Hamakua Highway/rraffie Division Projects 66,868 86,868 14,692 72,176 Kalopa/Mamalahoa Bridge -Federal Funds 840,000 840,000 64Q,000 KalopalMamalahoa Bridge -County Funds 210,000 210.000 210,000 Opea/MamalahoaBridge -Federal Funds 564,000 564,000 564,000 Opea/Mamalahu Bridge -County Funds 141,000 141,000 141,000 Waikaalulat/Mamalahoa Bridge -Federal Funds 840,000 840,000 840,000 Waikaslulu/MamalahoaBridge -County Funds 210,000 210,000 210,000 Kuwaikahi Ctitlvert Replacement 40,000 40,000 40,000 - Big Hill L\ilvert Replacement 40,000 40,000 40,000 Hamakua Wooden Bridges and Road Repairs 71,350 71,350 9,100 62,250 Waipio Valley Road 241,819 241,819 208,756 25,084 7,979 Kalopa Bypass/Sand Gulch 12,879 12,879 5,054 7,825 MamalehoalLindsey-Kamamalu 100,000 100,000 100,000 Mamalahoa/Waimu Town 618,439 618,439 120,290 498,149 Nonh Kohala Highway/traffic Division Projects 33,961 33,961 6,225 27,736 (Continued) -94- Capital Projects Fund Schedule of Appropriations, Expenditures and Encumbrances - Non-GAAPBedgetary Basis Fnr the Ficc~ Year Ended Lune '10- 1997 (Continued) Authorira[ions 1996 Encumbrances Lapsed Project Title Forwarded Appropriations T41i11 Excendimres Encumbrances )£2Ia1lGL/. Highways and Streets, continued: MamalahoalLindaey-Kamamalu 90,513 90513 60,331 30,182 MamalahoalWaimeaTown 400,000 400,000 400,000 Lindsey Road Improvements -Federal Funds 2,195,058 2,195,058 8,841 2,186,217 Lindsey Road Improvements -County Funds 500,000 500,000 500,000 Waikoloa Road Safety Improvements -Federal Funds 76,584 76,584 76,584 Waikolaa School Sidewalks 30,978 30,978 8,890 22,088 North Kohela Highway/Craffic Division Projects 632 632 - 632 South Kohala Highway/1'reffic Division Projects 30,071 30,071 12,500 17,571 Alii Drive Deign and Archeological Study- Federal funds 1,608,817 1,608,817 324,720 1,284,097 AliiHighway,PrivateFunds 315,733 315,733 90,629 225,104 Kona Roed Improvements - Fedeal Funds 1,038,023 1,038,023 663,902 374,121 Kuakini/Palani Road -Hualalai 174,544 174,544 155,029 19,515 Kaloko/Memalahoa Hwy -Private Funds 48.000 48.000 48.000 Napoopoo/Mamalahoa Hwy -Private Funds 161,250 161,250 161,250 Kuakini/Palani Road -Hualalai 150,000 150,000 142,535 7,465 Mamalahoa/Halualoa-Keauhou 500,000 500,000 15,110 484,890 Alii Drive Shoreline Protettion 97,000 97,000 97,000 Kona Roed Improvements -County Funds 16,140 16,140 4,668 9,957 1,515 Kona Road Improvements -Federal 57,412 57,412 10,958 46,454 North Kona Highway/traffic Division Projects 137,200 137,200 62,952 74,248 South Kona Highway/traffic Division Projects 229,501 229,501 133,414 96,087 Kuakini Highway Improvements 200,000 200,000 73,815 126,185 Palani Road Sidewalks 150,000 150,000 150,000 South Kona Highway/1'mf5c Division Projects 106,767 106,767 37,541 69,226 Alii Drive Bridge Replacement -Federal Funds 500.000 500.000 500.000 Alii Drive Shoreline Protettion 53,000 53,000 53,000 Kona Road Improvements Phase II -Federal Funds 4,708,800 4,708,800 4,708,800 Kau Highway/traffic Division Projects 50,000 169,200 219,200 2,212 216.988 Ka'u Highway/fnffic Division Projects 67,300 67,300 67,300 Islandwide Drywall Drainage 50,000 50,000 50,000 Handicap Bamer Removal 93,450 93,450 93,450 Islandwide Drywall Drainage 98,153 98,153 98,153 Circle Island Highwey/I'raffic Division Projects 69,850 86,990 156,840 86,516 70,324 Bridge Inspection, Maintenanre, Repair 638,726 638,726 96.596 22,590 519.540 Project Advance/Survey Per Diem 9.018 9,018 9,018 Seismic Bridge Retrofit -Federal Funds 252,000 252,000 252,000 Seismic Bridge Retrofit- County Funds 63,000 63,000 267 62,733 Island-wide Right-of-way Land Acquisition 100,000 100,000 700 99,300 Manienie/Kaiwiki Bridge -Federal Funds 1,624,000 1,624,000 1,624,000 Bridge Inspection/Appmisal -Federal Funds 43,601 - 43,601 1,000 42,601 Total Highways and Streets 25,4(19,187 16,432,545 41,901,732 6,789,475 30,155,602 4,956,655 Sanitation and Waste Disposal: Solid Waste Disposal: Hilo Landfill Closure 38,563 38,563 26,245 1,792 10,526 East Hawaii MRF 5,227 5,227 5,227 Keeau Transfer Station 18,8[9 18,819 18,819 - (Continued) -95- Capital Projects Fund Schedule of Appropriations, Expenditures and Encumbrances - Non-GAAP Budgetary Basis Fnr thr Fis I Y ar nd d J m 'l0 1997 (Continued) Authoriu[ions 1996 Encumbrances Lapsed Project Title Forwarded Appropriations ~1 F~oendimres Fncemhmnces Balances Sanitation and Waste Disposal, continued: Solid Waste Disposal, continued: Hilo Landfill Closure 50,000 50,000 19,281 30,7]9 KailuaLandfillClosure 115,503 115,503 82,719 32,784 KeauhouTrensferSUtion 700,000 700,000 287 699,713 KeauhouTranaferSUtion 19,6(4 19,614 14,186 5,428 Total Solid Wesre Disposal 197,726 750,000 947,726 161,537 770,436 15,753 Sewers: Hilo Ocean Outfell-Fedeal funds 15,927 15,927 15,927 Hilo Wazrcwater System 33,632 33,632 33,632 Hilo STP Demolition/Rehabilitation 700,000 700,000 700,000 Papaikou Collector Sewer 226,802 226,602 89,459 137,343 Banyan Drive SPS Rehabilitation 250,000 250,000 250,000 Ainako Inrercepmr Sewer A&B - SRF 318548_ 316,548 318,548 KamehamehaAvenueSewerRehabilitation 719,784 719,784 53 719,731 Hilo Wastewater Treatment Plant-Federal funds 180,983 180,983 180,983 Waiakea Mill Porrd Sewer 1,220 1,220 1,220 Hilo Wastewuer Treatment Plant II -EPA 26,794 26,794 26,794 Old Waiakea Mill Sewer -State 28,758 28,758 26,758 KalanianaoleCollector 1,543 1,543 1,040 503 Kamehemeha Avenue Sewer Rehabilitation 218,265 218,265 66,113 152,152 Papaikou Collector Sewer 212,824 212,824 212,824 Ainakoln[erceptorSewerA&B 127,044 127,044 90,791 36,253 Hilo Wastewater Treatment Plant 19,187 19,187 19,187 Paukaa Collector Sewer - 216,875 216,875 35,767 181,108 Kaumana Gardena Sewer 300,000 300,000 174,272 125,226 500 Houselou Collector Sewer 223,438 223,438 196,623 15,655 11,160 Kalanianaole Wastewater Collector Sewer-SRF 216,229 216,229 209,849 6,380 Papailtou Collector System 1,575,000 1.575,000 1,089,5]2 485,488 Kamehameha Avenue Sewer 1,500,000 1,500,000 336,508 1,163,492 Papaikou Collector System - FFIL 787.500 787300 787.500 KealakeheWastewaterTreatment Plant 128,003 128,003 16,863 11],140 KealakeheWastewaterTreatmrntPlant-Federal Funds 605,151 605,151 605,131 Kealakehe Effluent Disposal 96,139 96,139 96,139 Old Kona Airport Sewer 164,252 164,252 164,252 Old Kona Airport Sewer Pumping Station and Force Main-Federal funds 930,004 930,D04 930,004 Old Kona Airport Sewer Pumping Station & FM -Stet 267 267 267 Alii Drive/Waiafta Pump Station 117,223 117,223 63,680 33,343 Waiaha Bay SPS - SRF 1,874,855 1,874,855 1,713,346 159,509 AliiDrivelnrerceplorSewer-A&B-SRF 113,772 113,772 113,772 Kealakehe Wastewater Treatment Plant Expansion 308,965 308,965 618 308,347 AliiDrivelnrercepmrSewer-C&D-SRF 1,002,462 1,002,462 802,736 173,609 24,117 Kealakehe Sewage Effluent Disposal 398,685 398,685 18,685 380,000 Alii Drive lnteraptor Sewer-E&F-SRF 2.263,407 2,263,407 1,491,033 772,354 Holualoe Bay SPS 3300,000 3,500,000 1,899,450 1,600,550 Disappearing Sands SPS 2.000.000 2,000,000 2'000'000 SewerFaciliryRehabilitation 85,000 85,000 513 84,487 (Continued) -96- Capital Projects Fund Schedule of Appropriations, Expenditttres and Encumbrances - Non-GAAP Budgetary Basis For he Fic l Y r Fnd d I the 30- 1997 (Continued) Auntoriutions 1996 Encumbrentts Lapsed Pmiect Title Forwarded Appropriations Total F.xcenditures Fncembrances $alap~a Sanitation and Waste Disposal, continued: Sewers, continued: Waiaha Bay SPS - SRF 228,069 228,069 228,069 AliiDrivelnlerceprorSewerA&B-SRF 340,738 340,738 340,738 Alii Dtive Sewer Projects 392,352 392,352 96,323 72,517 223,512 Total Sewers 19,665,756 2,783,941 22,449,697 9,415,778 12,151,199 882,720 Total Sanitation and Waste Disposal 19,863,482 3,533,941 23,397,423 9,577,315 12,921,635 898,473 Culture and Recreation: Shipman Park Expansion and Improvements 1,209 1,209 1,209 Puna Swimming Pool 498,440 498,440 498,440 Puna-Pahoa Swimming Pool 1,287,617 1,287,617 1,285,776 1,841 PwaParks 210,000 210,000 101,361 106,639 Keaau Park Ballpark/I'ennis Lights 110,000 110,000 110,000 Pahoa Swimming Pool 450,000 450,000 324,958 125,042 Pahoa Swimming Pool 1,487,514 1,487,514 1,447,563 39,951 PunaParks 1,000 1,000 1,000 Hilo Bayfront Park Improvements 116,650 116.650 116,650 Panaewa Zoo Primate Roof 80,000 80,000 80,000 Downtown Hilo I-andscape improvements 135,OW 135,000 135,000 Panaewa Zoo Facility Improvements 213,800 213,800 28,596 185,204 Park Improvements -District 2 15,100 15,100 15,100 Palace Theater Mprovements 400,000 400,000 399,943 57 Onekahakaha Beach Patk Improvements 52,330 52,330 52,330 Park Improvements -District 4 5,250 5,250 5,250 Kawamoto Swim Stadium 129,200 129,200 456 128,744 Panaewa Zoo Veterinary Facility 55,560 (55,560) Onekahakaha Sewer/Park Improvements 54,994 54,994 54,994 Council District 4 Park Improvements 9,875 9,875 9,875 Kawamoto Swim Sradium 30,800 30,600 28,760 2,040 Kawamoto Swim Stadium Roof 250,000 250,000 180,900 69,100 Council Distrito 2 Park Improvements 15,100 (15,100) Hilo Municipal Golf Course 96,467 96,467 90,006 6,461 Hilo Municipal Golf Course 250,000 250,000 247,111 1,345 1,544 Panaewa Equestrian Center 200,000 (158,239) 41,761 38,258 3,503 Community Theater 400.000 (400.000) _ _ Waiakeawaena Playground 40,000 40.000 37,047 2,710 243 Park Improvements -District 1 20,506 20,506 20,506 Nonh(South Kohala Facility Improvements 23,656 23,656 23,656 - Council District 9 Park Lnprovements 250,000 250,000 181,459 40,685 27,856 New Waikoloa Park 108,000 108,000 108,000 North/SoudrKohalaPark 60,120 60,120 60,120 WaimeaSoccerFields 25,000 25,000 25,000 Kailua Playground Park 778 7,378 6,484 894 Kona Gym Showers/Lockers 250,000 250,000 250,000 Kailua Canoe Club Restrooms, Halau Storage 34 34 0 34 Hookena Park Water Tank 10,000 4,366 14,366 2,655 11,711 Old Kona Airport Swimming Pool 32,500 32,500 32,500 (Continued) -97- Capital Projects Fund Schedule of Appropriations, Expendi[tues and Encumbrances - Non-GAAP Budgetary Basis For Lhe Fisca-I Year Ended IOne 30. 1997 (Concluded) Authorizations 1996 Encumbrances Lapsed ProjeG Title Forwarded Appropriations Total E1,Rendimres Encumbrances )}5I911£C5. Culture and Recreation, continued: Noah Kona PooUOld Airport Park 1,197 1,197 1,197 Meuka Kona Recreational Facilities 31,620 31,620 31,620 Honaunau Rodeo Arena Improvements 4,366 (4,366) Distriex 7 Miscellaneous Perk Facilities 726 726 726 Distda 8 Miscellaneous Park Facilities 3,440 3,440 3,440 Kailua Playground Park 17,742 17,742 17,742 Disappearing Sends/Pahcehce/Kehaluu Parks -Private 280,536 280,536 209.400 71,136 Kona Swimming Pool 1,000,000 (674,612) 325,388 168,388 157,000 Kona Swimming Pool 2,000,000 2,000,000 2,000,000 District 8 Park Improvements 1,292 1,292 1,292 Kona Swimming Pool 500,000 500,000 500,000 Kahuku Park Improvements -Private 10,000 10,000 10,000 KonaSwimmingPool 674,612 674,6]2 96 674,516 Hookena Beach Composting Toilets 100,000 100,000 100,000 Park Improvements -District 7 6,095 6,095 3,375 2,720 HigashiharaParkPlayground 50.000 50,000 50,000 KabukuPark/HOVE 9,800 9,800 9,800 Handicap8amerRemoval 27,114 - 27,114 25,436 1,676 Total Culture and Recreation 9,339,977 1,458,152 10,798,129 5,311,489 3,376,765 2,109,875 Miscellaneous: County Oftices- Acquisition/Renovation 6,725,923 6,725,923 6,512,809 53,464 159,650 Countywide ADA Compliance 500,000 500,(x10 12,348 487,652 East/West Hawaii Office Renovation 3,863,207 3,863,207 93,060 3,770,147 Alae Cemetery Expansion 215,000 215,000 21,907 6,060 187,033 South Kohala Trails end Greenways 60,000 60,000 60.000 Ka'u Agricultural Water System -State Funds 500,000 500,000 500,000 Real Property Extension 8.303 8,303 8,303 Total Miscellaneous 11,1)97,433 775,000 11,672,433 6,640,124 4,329,671 902,638 Total Capital Projects Fund $71,590,173 523,811,638 $95,401,811 $30,938,959 $55,063,297 $9,399.555 -98- ~ ~ ~ PROPRIETARY FUND$ ENTERPRISE FUNDS KULAIMANO_ EGDERL:Y HOUSING PROJECT - Used to.account £Qr the ~ , s: operatipn of a housing project for low income elderlys pe~sgns~lacated nprt~ of ~ h Hilo. Revenues are from rents callecfed and fedeirs~ reliE spil~sidies<, OULI $KAHI AFFORDABLE NOIISING PROJECI"'« Used.: tp.accoianf for the operation of a ~3 uruk dingle-family affa4'dable housm~ project located iit - P Waimea. Revenues ate from rents coliecked ' ~ , . . , ~ i F: i ,i COUNTY OF HAWAII Enterprise Funds Combining Balance Sheet at June 30, 1997 (With comnarative totals for June 30- 1996) Kulaimano Ouli Ekahi Totals Elderly Affordable N~ysin$ Proi t Ho ~ci $ Proi 1~4Z 1~ Ascets Cturent assets: Cash and cash equivalents $380,621 $ 895 $381,516 $ 311,962 Investments 500,000 500,000 500,000 Imprestfund 50 100 150 100 Accounts receivable 166 7,540 7,706 11,057 Interest receivable 1,483 278 1,761 1,599 Other receivable 546 546 945 Prepaid expenses 2,417 2,417 2,475 Total current assets 884,737 9,359 894,096 828,138 Restricted assets (cash and cash equivalents): Tenant security deposits 8,367 17,318 25,685 25,320 Deb[ service reserve 161,207 161,207 157,227 Operating reserve 40,149 40,149 37,900 Total restricted assets (cash and cash equiv.) 169,574 57,467 227,041 220,447 Fixed assets: Land 250,000 503,877 753,877 753,877 Buildings 1,136,008 1,136,008 1,136,008 Accumulated depreciation -buildings (437,055) (437,055) (412,440) Ftunishings and equipment 87,510 87,510 85,516 Accumulated depreciation -furnishings and equip. (68,817) (68,817) (56,480) Grounds and site improvements 261,000 261,000 261,000 Accumulated depreciation -grounds and site improvements (128,820) (128,820) (121,242) Fixed assets (net of accumulated depreciation) 1,099,826 503,877 1,603,703 1,646,239 Totalasse[s $2,154,137 $570,703 $2,724,840 $2,694,824 (Continued) -99- COUNTY OF HAWAII Enterprise Funds Combining Balance Sheet at lone 30, 1997 Q~jth cmm~arafive [oLals for Inne 30. 19961 (Concluded) Kulaimano Ouli Ekahi Totals Elderly Affordable Housing Proiect H_ Wincing PrTieet ~ 1996 Liabilities and eayily Curtent liabilities: Warrants payable $ 14,259 $ 2,192 $ 16,451 $ 12,464 Accounts payable 1,944 1,944 1,904 Due to developer 11,022 11,022 7,770 Unearned rental income 172 358 530 502 Notes payable -current 12,280 12,280 11,509 Total curtent liabilities 28,655 13,572 42,227 34,149 Current liabilities payable from restricted assets: Tenant security deposits payable 8,694 14,727 23,421 25,428 Total torten[ liabilities payable from restricted assets 8,694 14,727 23,421 25,428 Noncurtent liabilities: Notes payable 1,159,451 1,159,451 1,170,878 Total noncurrent liabilities 1,159,451 1,159,451 1,170,878 Total liabilities 1,196,800 28,299 1,225,099 1,230,455 Equity: Contributed capital: Developers 250,500 544,367 794,867 791,622 Intergovernmental 160,796 160,796 160,796 Total contributed capital 411,296 544,367 955,663 952,418 Retained earnings: Reserved for debt service 161,207 161,207 157,227 Unreserved 384,834 (1,963) 382,871 354,724 Total retained earnings (deficit) 546,041 (1,963) 544,078 511,951 Total equity 957,337 542,404 1,499,741 1,464,369 Total liabilities and equity $2,154,137 $570,703 $2,724,840 $2,694,824 - 100 - COUNTY OF HAWAII Enterprise Funds Combining Statement of Revenues, Expenses and Changes in Retained Earnings For the fiscal year ended June 30, 1997 {With Como ra[iy o alc for the ficc 1 year ended June 30. 19961 Kulaimano Ouli Ekahi Totals Elderly Affordable t-t__ousine Project Honsine Project j92Z 1Q2Ct Operating revenues: Rental receipts from tenants $ 77,899 $188,307 $266,206 $ 132,982 Rental subsidy from federal government -HUD 156,332 156,332 158,719 Laundry receipts 3,095 3,095 3,017 Miscellaneous 2,604 2,604 291 Total operating revenues 237,326 190,911 428,237 295,009 Operating expenses: Utilities 12,860 21,069 33,929 14,413 Maintenance and repairs 14,576 86 14,662 50,233 General and administration 76,414 101,864 178,278 103,888 Lease expense 76,226 76,226 19,056 Depreciation 44,640 44,640 44,059 Total operating expenses 148,490 199,245 347,735 231,649 Operating income (loss) 88,836 (8,334) 80,502 63,360 Nonoperating revenues (expenses): Interest income 33,559 1,322 34,881 35,551 Interest expense on long-term debt (83,256) (83,256) (82,151) Loss on disposal of assets (4~) Totalnonoperating revenues (expenses) (49,697) 1,322 (48,375) (47,006) Net income (loss) 39,139 (7,012) 32,127 16,354 Retained earnings, beginning of yeaz 506,902 5,049 511,951 495,597 Retained earnings (deficit), end of year $546,041 ($1,963) $544,078 $511,95 t -101- COUNTY OF HAWAII Enterprise Funds Combining Statement of Cash Flows For the Fiscal Year Ended June 30, 1997 tWi h omparative tolls for the fiscal y r nd d J m . 0. 19961 Kulaimano Ouli Elcahi Totals Elderly Affordable Ho iicinF Proiect I-Im~si E Proie t 1222 149ft Cash flows from operating activities: Cash received from tenants $ 81,388 $186,971 $268,359 $149,313 Cash received from federal government -HUD 156,332 156,332 158,719 Cash payments to suppliers for goods and services (96,036) (194,405) (290,441) (180,990) Net cash provided by (used in) operating activities 141,684 (7,434) 134,250 127,042 Cash flows from capital and related financing activities: Principal paid on long-term debt (10,656) (10,656) (11,761) Interest paid on long-term debt (83,256) (83,256) (82,151) Acquisition and construction of capital assets (2,104) (2,104) (8,790) Capital contributions 3,245 3,245 37,245 Ne[ cash provided by (used for) capital and related financing activities (96,016) 3,245 (92,771) (65,457) Cash flows from investing activities: Purchase of investments (1,500,000) (1,500,000) (1,500,000) Proceeds from sale and maturities of investments 1,500,000 1,500,000 1,500,000 Interest on investments 33,441 1,278 34,719 33,951 Net cash provided by investing activities 33,441 1,278 34,719 33,951 Ne[ increase (decrease) in cash and cash equivalents 79,109 (2,911) 76,198 95,536 Cash and cash equivalents at beginning of year 471,136 61,373 532,509 436,973 Cash and cash equivalents at end of year $550,245 $58,462 $608,707 $532,509 Reconciliation of operating income to net cash provided by operating activities: Operating income poss) $ 88,836 ($8,334) $ 80,502 $66,605 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation 44,640 44,640 44,059 Decrease (increase) in accounts receivable 5,644 (2,293) 3,351 (3,688) Decrease (increase) in prepaid expenses 58 58 (20) Decrease (increase) in other receivables 399 399 (945) Increase (decrease) in tenant security deposits 327 (2,334) (2,007) 17,562 Increase (decrease) in unearned rent (260) 288 28 94 Increase (decrease)in warrants payable 2,399 1,588 3,987 (485) Increase (decrease) in accounts payable 40 40 (665) Increase in other liabilities 3,252 3,252 7,770 Total adjustments 52,848 900 53,748 63,682 Net cash provided by (used in) operating activities $141,684 ($7,434) $134,250 $130,287 - 102 - TRUST AND AGENCY: k'i7NDS EXPENDABLE TRUST FUNDS PARK DEDICATION FUND - Uaed to account for moneys deposited with the ~ounty Ii~,~ a~~hdivi~er4 tC pro~ride laud f^r par~W and. playb ounds in siebdivisl^,Sl$-. HAWAII COUNTY HOUSING AGENCY -'Used to account fOr Federal'and County moneys treed . to provide public housing assistance within the County. + r: ' ~ , GEOTHERMAL ASSET FI;iND -Used to account for funds received from ~,eothermal developers fd`rnitig~te the effects of gepthermahenergy development. :fi, , ~ AGENCY FUNDS ~ ~ ,i. STATE tNE1CHT TAX FUND- Used to account for the collection arid'~a~ettti~ khe Sk~~e A~ rrt ~ ° mokor vehicle weight taxi collected"by the County on befiall of the_Stake.,.~, ~ , IMPROVEMENT DISTRICT NOS. 16 AND 17 < Used to account for EIi~ eo~t'fiki4h Qf ~ ~ ' . assessttt2ij7ts and related ir+tetest from property owners in impraVCme;tt~k t1iStYiC~ ~ f`Dr fi,~ttcing ~ the pay~ent~of special as'ssrinentbond interestand princi~tal i?Xt>Cd"s chbp*t+[d~~r~ ~~f ~ ~a used to finance the constrttcton of kriprovements ahd are $~l:nubted-lr it~dlth~ ~~~bl ~ ~ f"~ s ~c~:: funds. ~ , , ~ IMPROVEMENT DISTRICT REVOLVING FUND -Used td ~ceumuletp any surplus balance of an improvement district after final payment of ail bands. Such mdneye are avallab(e;to irwke up,,.: ~ deficiencies in other. improvement districts: ' IMPROVEMENT DISTRICT BOND AND INTEREST REDEMPTION FUND - Used tq account ' for debt service on special assessment bonds. PERFORMANCE AND REFUNDABLE DEPOSITS FUND • Used to account for.tniscellatjisous deposits left with the County: ~ PAYROLL CLEAKANCE FUND -Used to acmunt for the payment of County payroll with moneys transferred from the respective departments. FLEXIBLE SFENDING ACCOUNT -Used to account for funds that. employees gleck to have withheld from thefpay checks to be used to pay unreimbursed medical and depeitdenk,care expenses on apre-tax basis.: DEFERRED COMPENSATION FUND -Used to account for assets and liabillHes of the Caunty's deferred compensation plan. This page intentionally left blank. - 103 - COUNTY OF HAWAII Trust and Agency Funds Combining Balance Sheet, June 30, 1997 fWith comnazative totals for June 40. 19961 Expendable Trust Funds Hawaii County State Improvement Improvement Pazk Housing Geothermal Weight District District Dedication A¢encv ASSS:1 TaX j![p,l¢ No. 17 ASSCIS Cash and investments: Cash and cash equivalents $ $4,362,719 $ $494,429 $1,805,040 $1,645,593 Investments 111,054 838,738 Impress fund 100 Total cash and investments 111,084 4,362,819 838,738 494,429 1,805,040 1,645,593 Receivables: Due from federal government 51,995 Due from other funds Other 81,017 Total receivables 133,012 Restricted assets -cash & cash equiv. 1,400,000 Property and rights held under deferred compensation plan - Total assets $111,084 $4,495,831 $838,738 $494,429 $1,805,040 $3,048,893 i .iabilities and Fnuity Liabilities: Warrants payable $ $ 43,714 $ $ $ $ Accounts payable 13,269 Due to other funds 86,884 Loan payable Other liabilities 9,568 494,429 95 Advances and deposits Assets held for the benefit of improvement districts 1,804,945 3,045,593 Deferred compensation benefits payable Totalliabilities 153,105 494,429 1,805,040 3,045,593 Fund balances: Reserved for encumbrances 2,282,938 Unreserved: Designated for affordable housing 61,747 Undesignated 111,084 1,998,041 838,738 Total equity 111,054 4,342,726 838,738 Total liabilities and equity $11~ $4,495,831 $8~ $494,429 $1,805,040 $3®~S,S9~3 -104- A enc Funds mprovemen District Performance Improvement Bond and and Flexible Totals District Interest Refundable Payroll Spending Defected Revolvin¢ Rrdemotion ci ~ .1 ran ACG4u¢[Cn1[Ipensation ~ 12253 $ $37,409 $63,023 $ $137,981 $ $8,546,194 $8,617,092 249,533 1,199,325 1,096,737 100 100 249,533 37,409 63,023 137,981 9,745,619 9,713,929 51,995 31,015 3,930,268 3,930,268 3,340,083 g9 81,106 81,065 3,930,357 4,063,369 3,452,163 1,400,000 1,400,000 26,576,092 26,576,092 22,354,503 $~9,53~3 $37,409= $63,023 $3,930,357 $1~9~ $26,5 $41,785,080 $36,920,595 $ $ $ 3,959 $1,437,976 $ $ $ 1,485,649 $ 2,097,829 13,269 11,126 455 1,351,614 1,438,623 1,086,411 227,045 37,409 1,140,767 137,981 1,820,249 917,209 58,609 58,609 35,828 249,533 5,100,071 5,499,534 26,576,092 26,576,092 22,354,503 249,533 37,409 63,023 3,930,357 137,981 26,576,092 36,492,562 32,229,485 2,282,938 2,247,891 61,747 267,889 2,947,833 2,175,330 5,292,518 4,691,110 $2q~9,533 $3~:~ $63,023 $3,9~30.357~ $137,981 $26,576,092 ~ $41,785,080 $36,920,595 -105- COUNTY OF HAWAII Expendable Trust Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Fiscal Yeaz Ended June 30, 1997 (With comna-native tnLlc for the tieca yea-r ended June 30. 19961 Hawaii County Totals Park Housing Geothermal Dedication Azen~v ASSet 1222 1426. Revenues: Intergovernmental $ $8,390,887 $ $8,390,887 $9,195,991 Interest 6,282 149,537 42,554 198,373 173,699 Miscellaneous: Donations 50,000 50,000 70,304 Resale of property 225,666 225,666 Other 1,955 1,955 1,184 Total revenues 6,282 8,768,045 92,554 8,866,881 9,441,178 Expenditures: Current: Health, education and welfare 8,180,594 8,180,594 9,313,875 Pension and retirement contributions 71,562 71,562 Capital outlay 2,043 Debt service: Interest charges 263 263 482 Principal retirement 3,777 3,777 3,558 Total expenditures 8,256,196 8,256,196 9,319,958 Excess (deficiency) of revenues over expenditures 6,282 511,849 92,554 610,685 121,220 Other financing sources (uses): Operating transfers in -General Fund 121,585 Operating transfers out -Capital Projects Fund (9,277) (9,277) Total other financing sources (uses) (9,277) (9,277) 121,585 Excess (deficiency) of revenues and other sources over expenditures and other uses (2,995) 511,849 92,554 601,408 242,805 Fund balances, beginning of year 114,049 3,830,877 746,184 4,691,110 4,448,305 Fund balances, end of year $11~I,OSJ4~ $4,342,726 $838,738 $5,292,518 $4,691,110 - 106 - COUNTY OF HAWAII Hawaii County Housing Agency Schedule of Revenues, Expenditures and Changes in Fund Balance - Non-GAAPBndgetary Basis For he F's I Y ar Fnd d J m RO 1997 Variance Favorable Budgie[ AS.LIaI jUnfavorablel Revenues: Intergovernmental: Federal grants: Housing preservation grant $ 169,730 $ 169,730 $ HUD • Housing assistance 6,231,300 6,373,221 141,921 HUD -Voucher program 1,776,000 1,798,598 22,598 Total intergovernmental 8- 177,0 8,341,54 164,519 Interest earned 11,680 149,537 137,857 Other 227,622 227,622 Total revenues 8,188,710 8,718,708 529,998 Expenditures: Health, education & welfare 8,658,352 8,170,344 488,008 Pension and retirement contributions 83,220 71,562 11,658 Total expenditures 8,741,572 8,241,906 499,666 Excess (deficiency) of revenues over expenditures (552,862) 476.802 1,029,664 Fund balance, beginning of year 3,830,877 3,830,877 Fund balance, end of year -budgetary basis $3,2® 8® 0®c 4,307,679 $1,029,664 Adjustments [o conform with generally accepted principals: Encumbrances, beginning of year (2,247,891) Encumbrances, end of year 2.282.938 Fund balance, end of year - GAAP basis $4,342,726 - 107 - COUNTY OF HAWAII Agency Funds Combining Statement of Changes in Assets and Liabilities For he Ficc I Ye r Fnd d t me 30. 1997 Balance Balance July 1, June 30, 1996 Al~1L14llS 1)e~l~ctions [997 State Weight Tax Fund Assts Cash and cash equivalents $437,858 $ 5,567,067 5 $ 494,429 L3311111I1~S Warrants payable $ $ 5,510,496 $ 5,510,496 $ Other liabilities -due [o State of Hawaii 437,858 5,567,067 5,510,496 494,429 Total liabilities 43~ $11,077,563 $11,020,992 $494,429 Improvement District No. 16 ASSS<IS Cash and cash equivalents $1~'S~ ~ $40~ ~ $1 Liabilities Warrants payable $ $ 180 $180 $ Other liabilities 140 135 180 95 Assets held for [he benefit of improvement districts 1,402,412 402,533 1,804,945 Total liabilities $I~ $402,848 $360 $1,805,040 Improvement District No. 17 ACCe[C Cash and cash equivalents $2,460,618 $788,191 $1,603,216 $1,645,593 Restricted assets -cash and cash equiv. 1,400,000 1,400,000 Total assets $3,860,618 $788,191 $1,603,216 $ 1 iabiliti c Assets held for the benefit of improvement districts $3,860,618 $788,191 $~3~ 3®3 (Continued) - 108 - COUNTY OF HAWAII Agency Funds Combining Statement of Changes in Assets and Liabilities For h Fic I Y r Fnd d i me 30. 1997 (Continued) Balance Balance July 1, June 30, ~j~ I)eluctions 1932 Improvement District Revolving Fund AccP c Cash and cash equivalents $ $ 13,029 $ 13,029 $ Investments 236,504 249,533 236,504 249,533 Total assets 236,504 26®~ $ i.iabiliti s Assets held for the benefit of improvement districts $236,504 $13,029 $ $249,533 Improvement District Bond and Interest Redemption Fund A$SlrIS Cash and cash equivalents $37,409 $1,601,700 $1,601,700 ~ $3®~ I.13h11111liS Other liabilities -deb[ service on special assessment bonds ~$37~ $1601,700 $1,601,700 $37,409 Performance and Refundable Deposits Fund Ac~,c~[c Cash and cash equivalents $71,480 ~ $4® 8~ ~0~ i iabititi s Warrants payable $ 3,918 $ 49,009 $48,968 $ 3,959 Due to other funds 310 455 310 455 Advances and deposits 35,828 71,480 48,699 58,609 Total liabilities $ (Continued) - 109 - COUNTY OF HAWAII Agency Funds Combining Statement of Changes in Assets and Liabilities For he Fic 1 Y ar Fnd d i m . 30. 1997 (Coninued) Balance Balance July 1, June 30, 124 Additions Deauctianc 1997 Payroll Clearance Fund Assets Cash and cash equivalents $ $ 70,472,930 $ 70,472,930 $ Due from other funds 3,340,083 70,911,010 70,320,825 3,930,268 Other assets 89 89 Total assets $3,340,083 $141,384,029 $140,793,755 $3,930,357 i iabilitiec Warrants payable $1,859,865 $70,232,199 $70,654,088 $1,437,976 Due to other funds 1,047,984 1,351,614 1,047,984 1,351,614 Other liabilities -withheld payroll taxes 432,234 6,128,524 5,419,991 1,140,767 Total liabilities $3,340,083 $77,712,337 $77,122,063 $3,930,357 Flexible Spending Acrnunt Assets Cash and cash equivalents 59~ $421,096 $137,981 i .iabilitiec Other liabilities $ $559,077 1~ 37,981 Deferred Compensation Fund Acc tc Property and rights held under deferred compensation plan $22~3.54~503 $5~231~40,2~ $1,009..813 $26,576,092 j„ja iliti c Deferted compensation benefits a able $22,354,503 $5,231,402 $1,009,813 $26,576,092 PY ~ ~ ~ (Continued) - 110- COUNTY OF HAWAII Agency Funds Combining Statement of Changes in Assets and Liabilities FS1t ~hr Fi~~al Vr~r Fnd d I me.'t0. 1997 (Concluded) Balance Balance July 1, June 30, 122ft AddiliQns De ~~ctians 1222 Total -All Agency Fuuds ASSCiS Cash and cash equivalents $ 4,378,493 $ 79,476,142 $ 79,671,160 $ 4,183,475 Investments 236,504 249,533 236,504 249,533 Due from other funds 3,340,083 70,911,010 70,320,825 3,930,268 Restricted assets -cash 1,400,000 1,400,000 Other 89 89 Property and rights held under deferred compensation plan 22,354,503 5,231,402 1,009,813 26,576,092 Total assets $31 $155,868,176 $151~238,30~2 $36,339,457 i .iabil~tigy Warrants payable $ 1,863,783 $ 75,791,884 $ 76,213,732 $ 1,441,935 Due to other funds 1,048,294 1,352,069 1,048,294 1,352,069 Other 907,641 13,856,503 12,953,463 1,810,681 Advances and deposits 35,828 71,480 48,699 58,609 Assets held for the benefit of improvement Districts 5,499,534 1,203,753 1,603,216 5,100,071 Deferted compensation benefits payable 22,354,503 5,231,402 1,009,813 26,576,092 Total liabilities $31~ ,5~ $97~ $92 $36 - 111 - This page intentionally left blank. - 112 - ~ ~ GfiNERAL LC)~iG-TE1~M DEBT ACCOUNT GR.QUP` ; t y' 4 Tk~is ac"~ ount group accounts fyo~r the~lanyjg=Perm debt t~f, tt~e'~~~n~~~~+~,~,,~u;~'t~ir~etk~; exce 1; at relaked to kh¢ Ente rise Fu , d. c~ ~ ~ t, ~ ti ~s~ ~ u ~ x ~ , a ~ ~ f s ,r 1 , # K~ kw £ K.,.t $ L t ~ r , S ` r ~z~ , j i .r i i 4~k,f~#~ ~~"+~,e ~rY n n~.a~w y~' ~#.n9i ~ 3~ . ~ u}~ iii n'. i,_ "ra iFi ~ r , - 'r tt f y r ti ? t J t ~ i i i r z 'q` s. ~ ~ ~ ~ _ i.: - +`s ~s a , ' ~ s ^y; qx,~_ COUNTY OF HAWAII General Long-Term Debt Account Group Schedule of General Long-Term Debt, June 30, 1997 With omo~rative A_monnta for Tune 30. 1996 1222 124f: Amount Available and to be Provided Fnr the Payment of ng er_I~tyong-Term Debt Amount available in Debt Service Funds $ 18,429,799 $ 18,351,883 Amounts to be provided for general long-term debt: General obligation bonds 108,351,387 108,610,387 State Revolving Fund loans 27,666,145 21,376,897 Accrued compensated absences 17,785,879 13,917,849 Estimated claims and judgments 7,000,000 5,220,750 Capital lease obligations 602,063 377,248 Landfill closure and pos[closure caze costs 14,125,000 13,465,000 Total amounts to be provided for general long-term debt 175,530,474 162,968,131 Total $193,960,273 $181,320,014 n r 1 ona-Term Debt Payable General obligation bonds payable: 1977 Series A, public improvement bonds $ 324,000 $ 338,000 1978 Series, refunding bonds 21,695,000 23,215,000 1989 Series, refunding bonds 2,702,500 3,155,000 1993 Series, refunding and public improvement bonds 65,930,000 68,600,000 1996 Series A, public improvement bonds 30,000,000 30,000,000 1996 Series B, public improvement bonds 762,500 15,000 1997 Series A, public improvement bonds 4,000,000 Total general obligation bonds payable 125,414,000 125,323,000 Other general long-term debt: State Revolving Fund loans 29,033,331 23,016,167 Accrued compensated absences 17,785,879 13,917,849 Estimated claims and judgments 7,000,000 5,220,750 Capital lease obligations 602,063 377,248 Landfill closure and postclosure care costs 14,125,000 13,465,000 Total other general long-term deb[ 68,546,273 55,997,014 Total $193~960.2~73 $181 320,014 - 113 - COUNTY OF HAWAII General Long-Term Debt Account Group Schedule of Debt Service Requirements [o Maturity for General Obligation Bonds June 30. 1997 Total Bonds Bonds Fiscal Outstanding Year at Ended Beginning Total ,n . 0 of Year Primcioal Tn_ serest R~u~,rementc 1998 125,414,000 5,015,500 6,782,866 11,798,366 1999 120,398,500 6,312,000 6,536,324 12,848,324 2000 114,086,500 6,625,500 6,197,192 12,822,692 2001 107,461,000 6,953,500 5,833,920 12,787,420 21702 100,507,500 7,313,000 5,447,378 12,760,378 2003 93,194,500 7,677,500 5,048,207 12,725,707 2004 85,517,000 7,612,500 4,642,233 12,254,733 2005 77,904,500 8,027,500 4,227,559 12,255,089 2006 69,877,000 8,488,500 3,786,061 12,274,561 2007 61,388,500 8,940,000 3,311,881 12,251,881 2008 52,448,500 6,438,000 2,808,317 9,246,317 2009 46,010,500 6,791,000 2,467,508 9,258,508 2010 39,219,500 7,143,500 2,103,810 9,247,310 2011 32,076,000 7,532,000 1,719,382 9,251,382 2012 24,544,000 7,942,000 1,311,318 9,253,318 2013 16,602,000 8,341,000 878,985 9,219,985 2014 8,261,000 2,520,500 424,735 2,945,235 2015 5,740,500 2,651,000 294,893 2,945,893 2016 3,089,500 2,786,500 158,325 2,944,825 2017 303,000 303,000 14,771 317,771 $125,414,000 $63,995,665 $189 9~ - 114 - ~ ~ I m ~ w - e' - Y' - ~ s i„ 1 ; y ~ r a w 4 J GENERAL FIXED A$STS T - , ACCC7UNT GRn~JP' ~ ' " ~ ` ~f , U S i ,r.'. 'his account group aCeoun#s for all fixed assef5 pf the I'X~~fa~ ~`~~~~~~~~eb ~ , than those recoFded ~n.th~e enterprise Fund ~,~",~~r~~~ k ~ M,;,". - ~ - _ i k p~~ ~h~e ~t , P ~ ~F i - r try ~tss ?4 C+. ~i - ~Y c~ ~ ;a ' ~ p ; r~ tl~i tj iy' .'A ~ ~ i - P +t'~' &x ,1 ~~g'~A'4 d ;g: v s-. KIM' u t v ~ "r ~ ' k" ~ T}~iSs'P. ^z`~r"~~+{'~"~~"^ P-~f t%ra"}a",'a*~`S ew M'~ k'^"" .y,~f ~ ~w~' e r tt° x M ~ sir ~ 1~ a _ r ~P~ t~~5~ £ ~Nlp 4$~~~.~: ~ YN ~ w~ ~~~A. ` ~ 4 .~n,y` . a! Y 1 J - ~ ~ ~ 4f ~ ~ ~ ~ ~ ~ "Y" ~ _ " t ~A S y. ~s 1~~ ~ •b I COUNTY OF HAWAII General Fixed Assets Account Group Schedule of General Fixed Assets by Source, June 30, 1997 Wi[h omnararive Amounts for June 40. 1996 1~ 1~ General fixed assets: Land $ 15,513,843 $ 15,261,485 Buildings and structures 117,964,129 108,648,222 Machinery and equipment 44,908,696 40,532,998 Construction in progress 103,551,818 99,485,747 Total $281,938,486 $263,928,452 Investment in general fixed assets by source: Capital Projects Funds: General obligation bonds $ 63,686,550 $ 58,300,284 Federal grants 81,764,530 73,313,720 State grants 31,575,470 31,962,798 General Fund revenues 28,085,032 25,919,876 General Fund -Federal revenue 5,179,894 4,460,474 General Fund -State revenue 1,379,893 968,060 Special Revenue Funds revenues 6,874,349 5,675,235 Contributions 2,376,829 1,730,656 Assets acquired prior to 1979 (sources undetermined) 61,015,939 61,597,349 Total $281,938,486 $263,928,452 - 115 - COUNTY OF HAWAII General Fixed Assets Account Group Schedule of Changes in General Fixed Assets by Function For h Fic I Year Fnded J me 30.1997 Balance Balance lone 30, June 30, jQ~ A>il~itl4JIS Deductions ]9~ General government $ 14,244,214 $ 1,087,628 $ 905,929 $ 14,425,913 Public safety 34,417,103 4,524,225 211,996 38,729,332 Highways and streets 8,511,988 1,307,857 660,455 9,159,390 Sanitation 37,150,491 8,678,643 900,080 44,929,054 Health, education and welfaze 5,521,171 5,551 4,951,696 575,026 Culture and recreation 88,748,554 1,335,533 292,568 56,791,519 Educational facilities 8,588,689 15,314 8,573,375 Housing and community development 260,495 5,450,208 507,644 5,203,059 Construction in progress 99,485,747 12,867,160 8,801,089 103,551,818 Total $263,928,452 $35,256,805 $17,246,771 $281,938,486 - 116 - COUNTY OF HAWAII General Fixed Assets Account Group Schedule of General Fixed Assets by Function and Activity ]une 30- 1997 Buildings Machinery and and I.SIld C ~ (i c FdLUlpl?lilll T4fSt General government: General government buildings $ 448,075 $ 4,894,677 $ $ 5,342,752 Mayor's office 3,469,257 3,469,257 County clerk 277,765 277,765 Finance 1,365,647 1,365,647 Corporation Counsel 126,333 126,333 Prosecuting attorney 768,985 768,985 Planning 334,975 334,975 Personnel services 115,443 115,443 Research and development 47,069 47,069 Pubhc works 2,577,687 2,577,687 Total general government 448,075 4,894,677 9,083,161 14,425,913 Public safety: Public safety buildings 1,902,047 18,253,831 20,155,878 Police 6,728,410 6,728,410 Fire 11,055,441 11,055,441 Liquor 122,316 122,316 Civil defense 667.287 667.287 Total public safety 1,902,047 18,253,831 18,573,454 38,729,332 Highways and streets 1,317,341 1,944,578 5,897,471 9,159,390 Sanitation 449,169 38,071,286 6,408,599 44,929,054 Health, education and welfare 84,] 12 406,730 84,184 575,026 Culture and recreation 9,846,565 42,348,514 4,596,440 56,791,519 Educational facilities 27,429 8,545,946 8,573,375 Housing and community development 1,439,105 3,498,567 265,387 5,203,059 Total general fixed assets allocated to functions and activities $15,513,843 $117,964,129@ $44,908,696 178,386,668 COnStrllctlOn in progress 103,551,818 Total general fixed assets $281,938,486 - 117 - This page intentionally left blank. - 118 - I .e STATISTICAL S~CT~C7N F (UNAUDIT'~D) ~t ~A , i . ~`t ~ le i ~ i{ ' _ '~V. ~ t Y, 4 ~ r. 9 F tl Y i i. ~ ~ ynh fr OMO n M h~~~ M N N cwt ~/1 N V O, m tY 7 t° n n ono ~ ~ ~ ~ ~ ~M~. H y~ N~ V~~ r~ b 0 0~0' A 00 0o O. O. O .Ni .Ni .N-i .M. ~~/ac~~i»II Vi ~ h b r b b tN'1 B O O M ~D 00 M O;, O 7 h ~D hEA 00 T Oar ~ b ~ ~ b it Q ~ ul a0 M~~ h V h ~ h 7 ~ O~ O V ~O oo l~ V U 6~ ~ N M V V ~ pp.. ~~pp ~ C V O N ~ O O N W N ~ M a h ~O O~ ~ 0 0 M N Vl O C ~p L C ~ 69 M N b ~ ~ ~ 3 r ~v a 'b r ~ o ~ ~ ~ ~ ~ ~ 8 ~ ~ o a W ~ ~ 'd L e h oo rn o 0 O W w= ~ ([y^ d c~ ~ C.J v~j h N N 0~ M n vt .h. .d ~ O Q: ~ l w ~ N V 1~ ~ h (I. o E M M V vl ~O ~D 0~ 0~ 0^ ~ o _ 7. h N 7 M V1 ~/1 h M ~ C 7 000 ~ Oho M ~ ~ N ~ N d W etl ~ v~ h ~ V1 ~ h a0 ~ ~ ~ 16C1 V ~ O h P W ~ 7 ~ r M M > p h 00 N a M ~O OO 0 0 7 ~ ~ N N M M 7~ 7~ '/'1 Vt a vj ~ p~ U vii N~ O N~ V ~ N ~D f~ t ~ 00 y ~ .Ni ~ ~ .hy 00 Qo O~ ~ C7 N ti W OHO T T ~ ~ T ~ ~ ~ ~ W - 119 - Table 2 COUNTY OF HAWAII General Governmental Revenues by Source* Last Ten Fiscal Yeazs (Values in Thousands) Licenses Charges Interest Fiscal Taxes and and Inter- for and ]'gy= Assessments P@[1ID11S Governmental rvi s P n Iti s Other T~fal 1988 $47,101 $3,897 $13,592 $2,455 $3,119 $2,857 $73,021 1989 51,677 4,364 14,977 2,642 3,361 2,171 79,192 1990 58,653 4,928 24,559 3,281 3,742 1,902 97,065 1991 66,632 5,496 22,451 3,290 6,223 1,543 105,635 1992 75,774 5,331 27,188 3,576 4,150 2,613 118,632 1993 86,964 4,941 26,617 4,555 3,039 3,995 13Q111 1994 97,893 5,107 28,581 4,983 3,068 1,676 141,308 1995 100,028 5,788 31,684 5,439 4,205 1,588 148,732 1996 101,755 5,836 33,656 8,032 4,692 2,500 156,471 1997 96,124 6,124 36,016 7,796 5,859 2,009 153,928 * Includes General, Special Revenue and Debt Service Funds. - 120 - Table 2a COUNTY OF HAWAII General Governmental Tax Revenues by Source* Last Ten Fiscal Years (Values in Thousands) Real Fiscal Property Fuel Franchise ~Crat Tax Tax Tax Thal 1988 $42,803 $2,647 $1,651 $47,101 1989 45,394 4,562 1,721 51,677 1990 51,652 5,101 1,900 58,653 1991 59,132 5,269 2,231 66,632 1992 67,922 5,321 2,531 75,774 1993 79,000 5,349 2,615 86,964 1994 89,538 5,504 2,851 97,893 1995 91,200 5,613 3,215 100,028 1996 92,512 5,820 3,423 101,755 1997 86,490 5,783 3,851 96,124 " Includes General, Special Revenue and Debt Service Funds. - 121 - W W c C ~ O ~ ~ O y c SQ fl° S° 6~° 64 9° S° S° 6° SQ ~ ~ '.C7 ~ V ~ oo ~ V h Off. F O A F a 7i .~-i M 00 O~ 00 V1 00 y T 7 V O QNi V~1~ ~ tai M `3 C l~ t+Mi .N.. vN1w O 7 W O ~ y N~ M N N ri W ^ y MM. Q H tC W N 0 o y S° 6'Q S° b~ b'Q S° 6'Q S° S° b'e F a~i U ° g a rn a o g ~ ~ U 4 C o. ~ o ~n ~n ~n a ~ p vii ~ rn o~~ v o 5 5~ O~ h^ N chn 8~ W ~-r H H oo cn ~D O; 25 v~ N v~ c 3 ~ y a = ~ ~~~~o~~~~~ x ~ ~ s oN~~~~o~~ O w c F~, ~ ~ ~ v`Oi ~ o ~ m oho a H y N~ N N N N N 7 ~D 7 V Q x ~ F a U ~ v~ ss°s°s°s°ssssa°~ C ~ W D\ O~ D` O~ T O~ 00 O~ D` a\ ` y o fS. ~rn a ~ n a°o a ~ y ~ ~ vi i+i o; rri oo a o vi ~o Vt V' N ~D l~ n M W W a ~ f,.i M OA Orn h W O~ M O ~D U v ~ vii ~ ~ ono ono ono 00 vii ~ oMO ~ ~ `n oQO~ ~ v~ o ~ M M t+1 M pQ: N iC ~ NO ~ y~ .Nr ~ ~ O ~ ~ MO ~ F ~ a a u; m ~ v~ U h b oMO a rn~~ :9 a~0 0~0 ~ O~ pN~ ~ ~ ~ Obi T :x''11 0~ O. O~ T O~ o~ O. O. ~ P [L -122- Table 4 COUNTY OF HAWAII Assessed and Estimated Actual Value of Taxable Real Property Last Ten Fiscal Yeazs (Values in Thousands) Ratio of Real Property Total Assessed to Fiscal Assessed Estimated Total Estimated Y~ y~€ Actual Value Actual Value 1988 $ 4,591,893 $ 4,591,893 100% 1989 4,859,334 4,859,334 100% 1990 5,515,928 5,515,928 100% 1991 6,299,590 6,299,590 100% 1992 7,323,123 7,323,123 100% 1993 9,220,304 9,220,304 100% 1994 10,812,347 1 Q,812,347 100% 1995 10,618,892 10,618,892 100%a 1996 10,611,589 10,611,589 100% 1997 10,279,240 10,279,240 100% Notes: There is no personal property tax in Hawaii. Assessment ratios are uniform statewide. -123- ~ b N ~O O N O M ~O 0o O D\ M 00 Q~ N Y. ~ O~ l~ M M Q` N D` N N T ,p ~ ~ N ~ t ~ 0 ~ l~, ~0 ~ 00 ~ V K cn (y, N U M ~ V'1 a0 Q~ N V1 7 M h er N O D\ F d o~ c~ o~ ~o O~ N t~ rn v~ rn M ~o ~ o v rn ~n H& c•';, .-w r M M Ht V'! ~ .--i n~ M N M W z a V3 r ~ V9 ~ 'd O ~ O O O O O O S ~ O S S 0 0 0 0 ~ ~4 oC O O C O C O C ao O O O O O O O AG J E~ P~. y~ ~ y~ x F ~o W V~~ T h O 0. 00 00 O h N O O O D\ M l~ ~ y' ~ U'~ M ~p Vl \p 00 M M A,o av~v r-• c'v}a o vl~ v,oocnM ~a~ a ~ ~ C M N 00 V) ~D T O Q\ O~ M !Y ~D O~ V1 eC > ~ sNn v~ ~ 3 ~ z x U c 000000 0 0 00000000 W ~ y F :E ~ v~ v~ in v~ ~n ~n .n ~n ~n .n vi ~n ~n ~n ~n vi O j.% ~ Fn od o0 00 00 00 00 00 00 00 00 00 00 00 00 00 00 = F ~ ~ F a v3 ds ~ ~ O 'fl > U ~ 00 N 00 D\ 01 M ~p ~ O~ b ~ N N M 00 N G V7 O V1 Q\N-w m~ rn M 1~ r N ~ U~ M O M o0 pM~ fy, T O 00 00 00 ~D O vl O~ 00 [ ~ Q O etl ONO N O R M ~N+ M A N N N cN+t M~ n~ N ~u F ~ ~ vt ~ N M O ~ Vi M N M ~ L > z ~ ~ dN9 d a 0 a ~ ~ d U cG P4 b a a~ a .2 0 0 o E~ E 5? ~ o a E~ E 5° A a E~~ E~ 'C c E°- a E~ m E~ a ~SQxUSQU° ~~C~~'.U5QU° axi c ^o ~ oho ado a rn E w c U - 124 - ~ 00 r T M~ N Vl OO h 00 O Q R Q` ~t O O N a0 00 t~ M l~ oo M wy °-°vHvvl ~°O^.$e°y.a ~o~o~a 25~v°1 ~D ~On~ aovN~~~~ L O ~ H o0 a M N N a0 .~i E N O V'i h M M N ~O l~ O o0 M b 00 M {per 00 l~ vt M M pp l~ ~ r r M n b M 00 N F Vl N ~ n nil N ~ ~j, r N ~ W 7 N ~D ~(~`pp~ 00 M NI O 7 N 00 cn 7 Z ~ Vl 4~9 fA fA b9 6~9 GSQG~, p p p p p p p p p p p p p o pp p p pp pp pp pp b~ 0 0 0 0 0 0 0 0 h 0 0 0 0 0 0 0 VO'.1 0 S S 0 0 0 0 p ti ~ ctl fR 00 0 0 0 0 0 0 0 00 O O O C O 0 0 00 O C O C O Ci C F a O\ O~ ~ pp N M h~ M h~ O O V M P O r W 0p 7 M N w ,p 00 v~ 8 00 ~l h ~ O M i~ ~O 00 ~ 'd' M O ~ O~ v1 ~O N O N O ~p 00 ~D T 00 ~O t+~ Vi ~ T O~ O 00 N M Vt v'^ v~ ~O o0 N M 7 7 ~ C O. ~ ~O ~ h fV cV l~ W N h M l~ M V9 M ~L ~D O N ~D h ~~pp M O~ 00 U ~ ~O ~D M ~/1 7 N r M .~-i z ~ y b9 ~ ~ Vi N 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ~~yJ V1 V'1 Y"1 h ~ h h h V1 ~ h V1 V1 h Vl h V1 h Yl h ~ Vl Vl h ^ fA 00 W o0 00 00 00 00 a0 00 W o0 00 00 00 W W o0 00 W W oo W 00 00 D` Op vl M M T 7 h O M O 00 00 O o0 O ~/'t l~ O pp.~ D\ V n w y T O. N 00 M N Vl ~ ~O et V1 00 l~ ~ M W O g N~ b r O 00 M A O O ~y C N f ' M 7 ~D l`~ ~O en T O~ O O~ en f ~ O~ O~ N ~D V l~ ~ d '.a' 00 q v1 ~O M h M O 7 00 0\ 00 b O D\ O~ h b M1 N O~ N ~O o0 N N O ~ ~ N ~'f h M r M M N ~O h 7 0~~ z ~ ~ ~ ~ 4M4 'ea 3 id ~ ~ y 'G b C . y C ~Ny ~ b N ~ ~ a~ U LC oL il PG ~ O PG N ~ .a PG y 0.' '7~ O ~ O N b U N_ ~ O N 7 4 A r~ ~ Q N~~ A L~ ~ Y c a E ~ E 5 ~ Z~ c a. E~ E 5 ~ o E E~ E 5 o c p, E ~ E ,e 'C a o. e~ o c v' c H ~E `raa o o b erb p F E 5¢ x v S¢ v° E a¢ x U S¢ U E~¢ x U S d U '3 ~ ~ rn a e ~ ~ ~ rn a W U 125 - ~ N ~ N 00 \D Q\ ~p 00 M N W O~ ~ oq aD h V1 00 h h h D\ D\ N N N w~ O N 00 vl ~O N~ O N h N ~q M V ~T ~ O~~ N V1 M N~ O~ O ~ 00~~ Q l~ 00 7 00 00 C~, Ow M t~, l~ N cat v], cy. N R 00 M Ow O f`1 ~D I' 00 ~~pp ~~pp ~p pp ..i 00 ~D h 00 ~O O 00 Vl N O h n'i M 00 Vl ~D N QD ~ ~ Q O~ ~O ~p pph ~D N VV''~~ M O N N M N h ee{{ ~/l V M ~D ~ M cn •R O Q~ h O E,,, & Vl M h O V1 M N N M (`1 GD V"i h 0 ~O M M vy 00 W~ V1 ~ h M l ~ M I w b z Q~ p p p p Vf p p p p p p p f~ b y O O O 0 0 0 0 0 0 X 0 0 0 0 0 0 8 V ~O/1 0 0 0 0 0 0 0 7 ~ooooooo~ ~ooooooo~ o00000000~ w " V~1 VM1 ~ 8 ~ GMi oo W W P O ~ ~ h oho ~ b ~ ~ ~ N r <+~i ~M{ ~ ~ N M O A C h 00 n l`1 ~ ~/"j t w o0 O; ~D c+l ~ S I M o0 f~ t~ 7 l0 ~ 00 v~ ~O vt O en N N h 00 N~ D\ oo M ~O M p h QD ~ O h O N 00 h ~'1 M h 00 00 ~D 7 F ~p O M y ~O h h ~O O M~ O h N o0 ~/1 ~/1 O ~n N V O O O~ ~ V~ ..l O M vl V N ^ 1~ N 00 ~ ~O M ~ M O~ ~O ~ d' 'S M N N z .-r N bq b~9 69 N b9 f!Y .-n y O O O O O O O O g O O 0 0 0 0 0 0 ~n 0 0 0 0 0 0 0 0 ~n ~~E/ Vl Vl V1 V1 N V'1 ~/1 V'1 Y'1 V1 Vl Vl Vl V'1 V1 ~ 7 h Vl V1 h h h Vl Vl V Yi 00 00 00 00 00 W W 00 h 00 00 W 00 00 00 00 W V W 00 00 00 W W 00 00 V 7 It ~ fiq fA b9 Gq F• P. O r C f~ V/ O~ ~O ~ O e~1 ~ 00 h N 00 00 M M O O d' O V p~ O~ ~ p~ V o0 O~ w ~ Vl ~/t h 00 ~D M O W SOD ~ vl 00 h oo OT h t~ 0o M O oo O ~/1 rr \O M DD t+'' 1 ~ 00 ~+1 00 O: N 1~ M ~ ~D ..p• ~O ~O ~ h N O va`i O h V n ~ N O b HMi .h. ~ ~ vhi ~ ~ N a a ern ~ ~D ~ ~ O >z~ ~ ~ ~ ~ ~ ~ 'fig •p 'C 'y LL ~ GS Ji y PG .qi y v cC a 'S a ~ o d a ~ oe ~ ~ a ~ a i aai c ~ g~° 3 u Q v •O y~ 8 id 3 v a d v ~ 8 `d 3 v ~ •5 ~ aZi ~ o a E E 5 d o a E E 5 ~ L ~ ~ O E E~ ~ c E a •E ~ ~ E 7 'C ~ E a •E ~ 4: E~ 'C c E a E~ Q x U S CCU x d x U 5 Q U x E~ Q~ U 5¢ U° x ~ M ~ U O~ ~ ~ N ~ [L O U - 126 - ~ N N M 00 r r V1 Q. A p8 r N~ ~O T O N .d. L' ~ M r O~ ~/1 r O~ r of 00 N V ~ b r 00 ~ ~ p~p~~ ~M~pp Vj, O0pp0p f~ N t'~j [+1 ~ V 77 O~ M N ~ V N H ~ O O ~D ~ N ~ ~ M M vii Off. ~ W n O~ 1~f1 n ~ 00 7 V 00 r~ r M 00 ~O 00 M~ 00 r M h N P fy, 'z ~ p pp p p pp p pp fA oo Vi 'dp h 8 0 S S O S 0~ o S S S S O S S V a~ OG O O O O O C O V 90 G C O 0 0 0 0~ F P. pOp~~ r ao O o0 O ~O avo~ 00 O O N ~n O~ ~O ~n M O~ ~ O~ l~ V1 W V~1- n a h N r~ O;, M M~ W ~ ~ b .r--i ~ N h 00 r ~D lD V') p~ .r vl R h M M ~O ~ r M M p O$ O~ r 7 G f" ~ .w M v1 V M N N O R ~ Om ~ H~'1 N o~0- NN+ O z N ~ ^ ^ y C~ 0 0 0 0 0 0 0 0 ~/'t 0 0 0 0 0 0 0 0 V~ ;a v~ vt vt Vt vl Vt H V1 ~ ~ vt v~ h vl Vl h 7 ~ 00 00 00 00 00 00 00 00 '7 W 00 00 00 00 00 00 00 ci a ~ y yi 69 ~[-a M N ~n V1 O GO $ ~D ~ b ~ N T .r.. W O ~ r ~ W L W~ N M er O 00 M r.. W Vt OD ~ N M ~ o~ OO M Vl 00 M~ l ~ vl 7 o M a ~y ~ oo ~ v Vi O cn O C M r oy o~ O~ T y r O~ N ~O O N N ~ ~,,,i W M M~ 00 O~ O~ M~ O N r vt 00 00 N M O y ~D p~ M ~D r r oo v M r oo N z fA " Y' E w ~ ~ ~ C _C b C ~ yU ~ b a"i C ti N Z G C Q' y g U Ct Cam', a~. P~4 ,3_ aFF`~ ~ v ~ D ~ c aai c ~ ~ 3 y o a°i 'd '7 ~ t° 3 ~ c ~ E b v ~ °v o ~ ~ ~ E 5 v atj, ~ ~ c E ~ e E o, ~ E ~ e E E~Q7CUSQUx ~~QxU5QU5 > ~ ~ ~ w z -iz~- Table 6 COUNTY OF HAWAII Principal Taxpayers June 30, 1997 Percentage 1996 of Total Assessed Assessed T x~ver )}IISlI1~SS 1~alL3ti411 Yalllatl4Il B. P. Bishop Estate Land Trust $154,238,200 1.3% Mauna Lani Resort Inc. Developer 136,401,400 1.1 %o SouthKohalaResortCorp. Developer 131,631,200 1.1% Global Resort Partners Ho[el 125,000,000 ].0% Mauna Kea Beach Ho[el Corp Hotel 97,098,300 0.8% Kona Village Associates Developer 91,667,700 0.7% Mauna Lani Bay Hotel, Inc. Ho[el 75,566,400 0.6%o ONKD Inc. (Orchid) Hotel 65,543,100 0.5% WaikoloaLand & Cattle Co. Developer 61,216,400 0.5 %a Kona Coast Resort Ltd. Time Share 47,930,900 0.4% $986,293,600 8.0% Note: Gross valuation at January 1, 1996: $12,361,649,557 -128- Table 7 COUNTY OF HAWAII Computation of Legal Debt Margin lone 30, 1997 Total assessed value $10,279,240,111 Limitation as set by [he Constitution of [he State of Hawaii (A) 1,541,886,017 Amount of debt applicable [o debt limit: (B) County general obligation bonds $138,941,500 State Revolving Fund loans 29,033,331 Other debt 1,171,731 169,146,562 Less: Bonds maturing in current fiscal year 5,876,000 SRF loan principal maturing in current fiscal year 1,379,362 Bonds reimbursable by DWS 12,682,000 Pro rata share of 1978 Sinking Fund 8,064,429 28,001,791 Total amount of debt applicable [o deb[ limit 141,144,771 Legal debt margin $1,400,741,246 (A) The bonded deb[ limitation of the County of Hawaii is established at 15% of [he total assessed value of all county real property as established for tax purposes on the last tax assessment rolls. (B) The Constitution of the State of Hawaii, as amended in 1978, states that the debt limitation is no[ applicable to indebtedness incurred under revenue bond statutes; or by a public enterprise when the only security for such indebtedness is the revenues of such enterprise; or of indebtedness incurred under special improvement statutes when [he security for such indebtedness is the properties benefited or improved or the assessments thereon; or, under certain conditions, to certain types of general obligation bonds issued by [he County or S[a[e of Hawaii. -129 ~ N vl 00 O~eD{ O M M Q F U~ y ~ V t~ 00 O0o n T z ro FL z~~ a ~ ~ U o~~~ N ~ 7 Q ~ ~ O a ~ y w ~ can T o~0 O ^ ~ a r A 'S ~ ~ vl rn Mw n n ~ ~ ~ w '9 b W N M M 00 h N C ~ Z° W M~ N N~ M~ O~ O O ~ o _ ~1 ~rpj o C ~ h~ W oM0 P .N~n O O M Ci ? V ~ d N ~ a E ~ Z Lo sro 'C o > ro ro ~ ~ N ~ y u x ~ ° E .3 ~ LT. ~ ~ a°i °c y O ~ 'w C~ CCo}} 'O C O W C U y~ i~/'j F" ~ ~~i rn ono o m ~ ~ ~ e v F-~ rCr//~~1 N ~ OO ~D V'~ U ~ [~l 1~ I~ l~ td N Vi ~O+ 00 N M M o0 h N d~ O ~ e~ O ~ V O W a M O~ 00 w C N m W e+-; 7 N pp r? O T V ~ rn~ M O. ~ O O M~ Ew Q O~ M_ ~O P v1 00 M O~ 00 ~ Q~ U C b ¢l ~,OD 00 ~D O~ O~ M Vt V'~ ~D N U C ~ O y y y rn M N~~ o rv rn m °v E "y ~ A ~ z 6~ Op tit Ow V1 ~ M M 00 h N GO ~ 'O .C F p y o+ ~ a M o~ oo o: .a a g C Q V~-~ 0~0~ vt N M N 00 ~D ~O N Q ~ y ~ h~~ O~ O O O O ~ y e3 b ~ o ro U ~ h ~CJ. E C pp pp 4p 4o p C T i.. N ~ O O~ 0 0 0 0 O S Q 'O 9 U y C Q o ~n M M a vi vi vi v, ~ ~ ~a~, E a~ on a N., O .N. 0 .M. .M. .M. ~ z ~ 'E ~ 4 ti 0 F a"i R' W ° CC o°OO ono a a rn rn rn rn rn on. Q o" U o~ a a o~ o± ~ a a fs. - 130 - Table 9 COUNTY OF HAWAII Ratio of Annual Debt Service Expenditures For General Obligation Bonded Debt To Total General Governmental Expenditures Last Ten Fiscal Yeazs Ratio of Deb[ Total Total Service [o General Fiscal Debt General Governmental Yg~ Princi°at Interest rvi F~xnendit~res F~xo n it ~r s 1988 $2,120,000 $4,850,366 $ 6,970,366 $ 74,383,408 9% 1989 2,967,000 4,899,844 7,866,844 79,578,807 10% 1990 3,022,000 5,083,110 8,105,110 85,213,673 10% 1991 2,681,000 6,324,606 9,005,606 102,457,902 9% 1992 3,026,000 6,137,804 9,163,804 115,070,212 8% 1993 3,992,000 5,936,363 9,928,363 123,140,556 8% 1994 4,923,187 6,459,361 11,382,548 134,984,061 8% 1995 5,335,443 6,245,235 11,580,678 139,831,035 8% 1996 5,327,414 6,067,082 11,394,496 140,225,931 8% 1997 5,984,439 7,597,939 13,582,378 153,420,338 9% - 131 - Table 10 COUNTY OF HAWAII Demographic Statistics Last Ten Fiscal Years Fiscal Per Capita School Unemployment Y~ Ponulation Income Enrollment Rate (Al 1987 114,400 $12,520 24,509 5.8% 1988 117,500 13,462 25,179 4.9% 1989 122,300 14,989 25,923 3.9% 1990 120,317 * 16,728 26,745 4.0%a 1991 126,400 16,520 27,834 4.5% 1992 130,500 16,846 28,587 8.1% 1993 133,100 17,573 29,433 7.5% 1994 135,500 17,798 30,164 10.8% 1995 137,500 18,214 28,188** 10.2% 1996 138,400 N/A 28,257** 9.9% (A) Calendar year. Sources: * 1990 Census (all other population figures as estimated by State Department of Planning and Economic Development). Public school enrollment only. Other data from County Department of Research and Development. - 132 - ~ 8 8 8 8 a a¢ a .O X ao Vl N M..` ~ ~ ~ ~ ~ z z z z z F ado ~ ~ ~ m oho ~D O. ~D O M Q\ 7 M C ~D M 1~ N l~ ~ N R O O cn ~D O v'~ O ~D o0 O f~ ~ M Oi b ti N M ti r M ~ ~ N n~i M O o0 .fir O U ~ ~ o h h o°OO o c00v 'v ao cy t ; v o o ao o ~ o0 N M M M N N N ~ a ~ > ~ Y o rn~ a 0000 ~ o~ o~ o'~o E x etl v ~ t+~t ~ l~ ~ ~ ~O ~O t~ ~D 4. T NI O 1~1 ~ ~ s 3 v 8 u d ~ r 'a x k. ~ v c E O ~ w E =M~°~~$ N •y c E v v~ ~n a~ v, a u-, M tO ~ y F U ~ a>i O G as U a ~ ~ U ~ y m ~O oo a r ~ a~ c v ~ t~ rn ~ °l. ~ ; o0 0o v_ ~ e{ l~ ~ p~ N M O~ 00 N h b b$ W a N~ p 0. N 4Y N N ~ ~ ~ y O a a r b~ T ~D N N~ r O [I. 7 vii ~ N N h~p~ N l w tN't' V M~ 000 M n 0 Vl r 1~ Vl ~ T V~ ~D l~ ~ N N ~ Or 00 ~ M~ ni M v ~n ~ o0 00 00 00 > E 4 ~ U ~ F ~ rrt W ~ O ~N. N N O h N ~ .OCR O 00 ~O C O~ ~ O~ N C N M~ t~ O 8 a .M-~ D\ R 0. O O `b t : o~o~ vNi n n rn ~ ova y, ~ tii ~ N (V M e{ M M M ~ ~ t 'O ~ 0 U Oro 0~0 0~0 00+ O~ ~ O~ ~ P ~ P T D` O~ D\ O~ O~ O~ ~ 0 h - t33- Table 12 COUNTY OF HAWAII Miscellaneous Statistical Data June 30, 1997 Date first charter adopted June 1968 Form of government Mayor/Council Area in square miles 4,038 Miles of streets (County only) 967 Number of street lights 7,836 Fire protection: Number of stations 18 Number of fire lighters and officers (exclusive of volunteer fire fighters) 294 Police protection: Number of stations 8 Number of substations 4 Number of ponce officers 353 County water service: Number of consumers 33,402 Average consumption in gallons per day 21,381,773 Miles of water lines 1,078 Miles of sanitary sewers (County only) 60 Number of building permits issued: Building permits 2,819 Electrical permits 2,582 Plumbing permits 2,201 Sign permits 73 Recreation and culture: Number of parks 118 Number of gyms and recreation centers 38 - 134 -