2022-COH - Annual Comprehensive Financial Report

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The positive impact of the above reduction in expenses was offset by a slight reduction in revenues. The County saw a $62.8 million reduction in operating grants and contributions, which was primarily a reflection of the fact that most of the grants that the County expended during the previous fiscal year was not extended into the current fiscal year. Most notably was the CARES Act grant previously discussed above. The negative impact of such a large decrease in one aspect of revenues was mitigated by increases in the other categories of revenue, which most notably included an increase in property taxes by $12.8 million due to a $1.7 billion increase in the assessed value of the net taxable real property, with the majority stemming from the category of taxable buildings ($1.5 million). Revenues from the general excise tax surcharge increased by $13.4 million from the prior year, which corresponds to improvements in the economy overall as the County and State recovered from the impacts of COVID-19, including increased tourism activity. The County also recognized $17.5 million in revenue from the County transient accommodations tax, under Act 1, 1St Special Session 2021, which became law on July 8, 2021. The counties were authorized to establish and administer their own transient accommodations tax (TAT) at a maximum rate of 3 percent. On December 10, 2021, Mayor Mitchell D. Roth signed into law Ordinance 21-89 which imposed a 3 percent HCTAT, which shall take effect on January 1, 2022. Monies collected were to be deposited into the general fund as unrestricted revenues. Other Information Independent A udit The County Charter requires an annual audit by independent certified public accountants. N&K CPAs Inc. was selected in accordance with the County Charter and the procurement provisions of the Hawaii Revised Statutes (HRS) and Hawaii Administrative Rules (HAR) to perform the audit. Employee Union Contracts Hawai' i County's civil service employees are members of eight different bargaining units, of which all contracts are set to expire on June 30, 2025. 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 Annual Comprehensive Financial Report for the fiscal year ended June 30, 2021. This was the thirty fourth consecutive year that the government has received this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive financial report. This report 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 Annual Comprehensive Financial Report continues to meet the Certificate of Achievement Program's requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate.