REP FC 076 2018/01/23 (2016-2018)

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• REPORT OF THE • COMMITTEE ON FINANCE DATE: January 23, 2018 Re: Comm. No. 696/Bill 93 PLACE: Council Chambers Kailua-Kona, Hawai`i TIME: 2:40 p.m. Council Chair and Members Hawai`i County Council Hilo, Hawai`i 96720 Your Committee on Finance, to which was referred Bill 93, reports as follows: Bill No. 93, transmitted by Finance Director Deanna S. Sako, via Communication No. 696 dated January 4, 2018, amends Ordinance 17-39, as amended, the Operating Budget for the County of Hawai`i for the Fiscal Year ending June 30, 2018. This bill increases revenues in the Real Property Tax Sale Cost & Expenditure account ($525,000); and appropriates the same to the Real Property Tax Sale Cost & Expenditure account for a total appropriation of$1,070,000. Fund appropriation accommodates an increased amount of parcels anticipated for Real Property Tax Foreclosure Tax Sale in Fiscal Year 2017-2018. Director Sako explained that this is the account that pays all the real property tax sale expenditures. So when real property tax parcels are foreclosed on, the cost is charged to this account. The revenue account is the offset which is collected back from the sale proceeds from the foreclosure sale and the County gets reimbursed for all its-costs. In this particular year there were more parcels on the list than anticipated so the revenue needs to be increased as a related expenditure account to cover that. Council Member Herbert M. Richards, III, asked whether the $525,000 is the actual cost or whether the uncollected taxes are being written off. Ms. Sako responded that this amendment will be the total revenue up to the total $1,070,000, and is just the cost-related to the sale. She further explained that the first part of the sale proceeds goes to pay off the taxes, interests, and penalties and the costs are also part of the minimum upset price and therefore the costs get paid off as well. FC Report No. 76 p