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Honorable Members of the County Council <br /> May 5, 2014 <br /> Page 2 <br /> • Addition of"KALO Gymnasium:" $2.5 million <br /> • Addition of"Liliuokalani Gardens Renovations:" $1.0 million <br /> • Addition of"Na`alehu Park Playground Equipment:" $0.3 million <br /> • Addition of"Kilauea - Keawe Street Resurfacing (Ponahawai St. to Waianuenue Ave.):" <br /> $4.75 million <br /> • Increase of$3.0 million for "Kamakoa Nui Workforce Housing Community" <br /> • Addition of"Island-wide Bus Shelter Project:" $0.39 million. <br /> Debt Service <br /> Every year, we strive to present a budget that is fiscally constrained (in terms of prudent debt <br /> service planning) and selective based on rational criteria. The Government Finance Officers <br /> Association, a professional organization of government officials, recommends a prudent debt <br /> service limit to be 15 percent of general expenditures. <br /> The lower the interest rate and the greater the revenues, the more can be borrowed while <br /> staying within the prudent debt service limits. The proposed operating budget for this coming <br /> fiscal year includes debt service for short term bond anticipation notes, which are used to <br /> reduce carrying cost and insure that cash will be available for projects as needed. As budgeted, <br /> the resulting total debt service is estimated at 8.67 percent of the general expenditures. If all <br /> debt that has been authorized by the County Council was issued, the debt service percentage <br /> would be 12.24 percent of the general expenditures. <br /> What is a Capital Improvement Project? <br /> A project is eligible for funding from the capital budget if it is a major nonrecurring expenditure, <br /> such as: <br /> 1. Land acquisition; <br /> 2. Infrastructure improvement other than buildings that add value to the land or improves <br /> utility (roads, drainage, sewer lines, parking, landscape or similar construction); <br /> 3. New buildings or structures or additions to buildings, including related equipment and <br /> appurtenances which are integral to the new structure; <br /> 4. Nonrecurring rehabilitation, remodeling or expansion of infrastructure and buildings; <br /> 4 <br />