HomeMy WebLinkAboutMIN COUNCIL 2020-06-04 2018-2020 SPECIAL Hawaii County Council
Special Meeting
43`'d Session
Hawaii County Building
25 Aupuni Street
Hilo, Hawaii
June 4, 2020
INVOCATION: Pastor Ron Brav of Calvary Chapel Hilo gave the morning's invocation.
CALL TO The special meeting of the Hawaii County Council was called to order at
ORDER: 9:01 a.m., in the Council Chambers, Hilo, by Mr. Aaron S. Y. Chung, Chair.
ROLL CALL:
Present: Mr. Aaron S. Y. Chung, Chair
Ms. Karen Eoff, Vice Chair(via videoconference from Kona)
Ms. Maile Medeiros David, Member (via videoconference from Kona)
Mr. Matt Kaneali`i-Kleinfelder, Member
Ms. Ashley L. Kierkiewicz, Member
Ms. Susan L. K. Lee Loy, Member
Ms. Valerie T. Poindexter, Member
Mr. Herbert M. "Tim" Richards, III, Member
Ms. Rebecca Villegas, Member (via videoconference from Kona)
PLEDGE OF The Chair directed the Council to the next order of business, Pledge of Allegiance.
ALLEGIANCE:
(At this time, Ms. Lee Loy led the Council in the Pledge of
Allegiance.)
STATEMENTS The Chair directed the Council to proceed to the next order of business, Statements
FROM THE from the Public on Agenda Items.
PUBLIC ON
AGENDA ITEMS: The following individuals registered to speak and came forward when called by
the Chair:
Allison Dupre: Comm. 774.12, in support.
(See Comm. 774.28)
Cyd Hoffeld: Comm. 774.12, in support.
(See Comm. 774.30)
Leona Lopez: Comm. 774.12, comment.
Hawaii County Council-43 June 4,2020
Farrah-Marie Gomes: Comm. 774.12, in support.
CHR. CHUNG: I'm going to close public testimony and go on to the rest of our
agenda. Mr. Clerk, can we skip over"Order of Resolutions" and put that at the
end?
MR. HENRICKS: Yeah, if there's no objections from the Council.
CHR. CHUNG: Anybody has a problem with that? I think we've got to get a
better handle on what's going to happen with our operating budget before we set
the rates. Okay, so, let's see. Let's go on to "Order of the Day, Second or Final
Reading." Mr. Clerk.
Change Order As directed by the Chair and with no objection from the Council Members, the
of Business: following items were taken out of order:
Bill 143: RELATES TO PUBLIC IMPROVEMENTS AND FINANCING THEREOF
(Draft 3) FOR THE FISCAL YEAR JULY 1, 2020, TO JUNE 30, 2021
Draft 3 of the proposed Capital Budget for the fiscal year ending June 30, 2021
requires a total appropriation of$296,068,000 and 55 projects, reflecting an
increase of$48,270,000 over Draft 2. Approximately $235,068,000 is intended to
be funded in whole or part by bonds, $16.5 million is to be funded by the State
Revolving Loan Fund or State Capital Improvement Projects, and $44.5 million is
to be funded by federal funds.
Reference: Comm. 775.15
Intr. by: Ms. David (B/R)
First Reading: May 21, 2020
and
Comm. 775.16: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Public Works
Department's Pratt Road Improvements project in the amount of$3.5 million.
; and
Comm. 775.17: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Environmental
Management Department's Construct Green Waste Facility at Hawi (Ka`auhuhu)
Transfer Facility in the amount of$500,000.
; and
Comm. 775.18: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Waikoloa Community Center/Gym/Emergency Shelter project in
the amount of$500,000.
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Hawaii County Council-43 June 4,2020
; and
Comm. 775.19: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's King Kamehameha Park—Gym Roof Repair & Other
Improvements project in the amount of$490,000.
; and
Comm. 775.20: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Kapa`a Beach Park—Solar Power Electricity project in the amount
of$110,000.
; and
Comm. 775.21: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Kanu O Ka `Aina Learning `Ohana Gymnasium project in the
amount of$2.5 million.
Motion to Approve: Ms. David moved to pass Bill 143, Draft 3, on second and
final reading. Seconded by Mr. Richards.
CHR. CHUNG: Now, Mr. Clerk, how are we going to handle this?
MR. HENRICKS: We can go through these. I'll read in each of these
amendments and then, as I read them in, the introducer of the amendment can
make the motion to amend, second, and then go ahead and pass them one by one
and then we'll go to the ones that aren't on the agenda.
CHR. CHUNG: Okay. And incidentally, we have Mayor Kim here, but I think
we'll let him speak prior to the operating budget because we're going to move this
thing quickly, right, the CIP (Capital Improvement Project)? Okay, go ahead.
Comm. 775.16: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Public Works
Department's Pratt Road Improvements project in the amount of$3.5 million.
Motion to Amend: Mr. Richards moved to amend Bill 143, Draft 3, with the
contents of Comm. 775.16. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards, any discussion?
MR. RICHARDS: Yeah,just a real quick summary. This is in North Kohala.
Pratt Road's one of the old cane haul roads. This is something that the
community has been interested as a secondary emergency access road. We've
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Hawaii County Council-43 June 4,2020
sorted through some of the problems with our first responders. And having this in
place so when we're able to fund this will help improve the safety access for
North Kohala. So, I ask for your support.
CHR. CHUNG: Okay and it's a re-appropriation.
MR. RICHARDS: It's a re-appropriation, correct.
CHR. CHUNG: Okay. Any other discussion? There being none, all those in
favor say "aye."
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.16 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
Comm. 775.17: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Environmental
Management Department's Construct Green Waste Facility at Hawi (Ka`auhuhu)
Transfer Facility in the amount of$500,000.
Motion to Amend: Mr. Richards moved to further amend Bill 143, Draft 3,
with the contents of Comm. 775.17. Seconded by
Ms. Lee Loy.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: Again, this is a re-appropriation, and it's for a green waste
facility in North Kohala. Environmental Management is going through a
retooling, and I think it's very timely to re-appropriate this as this is something
the community is asking for. I ask for your support.
CHR. CHUNG: All right, anyone else? If not, we have a motion on the floor.
All those in favor, say "aye."
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Hawaii County Council-43 June 4,2020
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.17 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
Comm. 775.18: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Waikoloa Community Center/Gym/Emergency Shelter project in
the amount of$500,000.
Motion to Amend: Mr. Richards moved to amend Bill 143, Draft 3, with the
contents of Comm. 775.18. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: Again, community in Waikoloa. We do not have emergency
facilities, per say, and so 500,000 is not enough to completely get this done. But
again, stepping towards the future and planning for our future. This is a
re-appropriation as well.
CHR. CHUNG: Okay, anyone else? There being none, all those in favor say
LC "
aye.
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.18 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
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Hawaii County Council-43 June 4,2020
Comm. 775.19: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's King Kamehameha Park—Gym Roof Repair & Other
Improvements project in the amount of$490,000.
Motion to Amend: Mr. Richards moved to amend Bill 143, Draft 3, with the
contents of Comm. 775.19. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: This, too, is a re-appropriation. I thought we actually were
going to be able to get to it maybe a year and a half ago. We put a lot of band-
aids on King Kamehameha Park, Hisaoka Gymnasium. But as we all know,
things can evolve this way. So, looking to re-appropriate that and actually finish
this up this next cycle and look for funding. I ask for your support.
CHR. CHUNG: Anyone else? If not, we have a motion on the floor. All those in
favor, say "aye."
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.19 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
Comm. 775.20: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Kapa`a Beach Park—Solar Power Electricity project in the amount
of$110,000.
Motion to Amend: Mr. Richards moved to amend Bill 143, Draft 3, with the
contents of Comm. 775.20. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: Yeah, this is Kapa`a Park. This is one of the beach parks in
North Kohala, north of Mahukona. And this is where, if Council recalls, we had
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Hawaii County Council-43 June 4,2020
appropriated some of my contingency funds for fixing the water system. This is
the same park—and putting this on the list to get solar powered electricity there
longstanding park. And I just ask for your support.
CHR. CHUNG: Okay, anyone else? There being no further discussion, all those
in favor say "aye."
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.20 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
Comm. 775.21: From Council Member Herbert M. "Tim"Richards, III, dated May 28, 2020,
transmitting a proposed amendment to re-appropriate the Parks and Recreation
Department's Kanu O Ka `Aina Learning `Ohana Gymnasium project in the
amount of$2.5 million.
Motion to Amend: Mr. Richards moved to amend Bill 143, Draft 3, with the
contents of Comm. 775.21. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: Yeah, this is an interesting project. This is Kanu O Ka `Aina,
as the Clerk has stated. It's a gymnasium at one of the charter schools in Waimea.
Initially, it was going to be funded and then it was defunded. Going forward, I
think this is a part that we may look at for building—something Council
Woman Poindexter had mentioned about a hardened facility someplace. This
may be a way to look at and, hopefully, if the COVID (coronavirus disease)
money comes through for capital investment, this may be something we can put
on. So, I wanted to put it back to see if we can maybe do something for the
greater Waimea and Hawaiian Homes area. I ask for your support.
CHR. CHUNG: Anyone else? There being none, all those in favor say "aye."
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Hawaii County Council-43 June 4,2020
Vote on Motion The motion to amend Bill 143, Draft 3, with the contents of
to Amend: Comm. 775.21 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. Any more amendments from anyone? If not,
Mr. Clerk, let's go back to Bill 143, Draft 3, as amended, right, with all of the
subsequent amendments.
MR. HENRICKS: That's correct, yes. Second and final reading.
CHR. CHUNG: Yes. Any discussion on this matter? Kona? There being none,
all those in favor say "aye."
Vote on Bill 143: The motion to pass Bill 143, as amended to Draft 4, on
Draft 4 second and final reading was carried by the following voice
(Adopted) vote:
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. Let's move on to the operating budget.
Bill 144: ESTABLISHES AN OPERATING BUDGET FOR THE COUNTY OF
(Draft 3) HAWAII FOR THE FISCAL YEAR JULY 1, 2020, TO JUNE 30, 2021
Draft 3 of the proposed Operating Budget for the fiscal year ending June 30,
2021, includes estimated revenues and appropriations of$585,678,628, reflecting
a $590,000 increase over Draft 2.
Reference: Comm. 774.11
Intr. by: Ms. David (B/R)
First Reading: May 21, 2020
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Hawaii County Council-43 June 4,2020
; and
Comm. 774.12: From Council Member Valerie T. Poindexter, dated May 28, 2020, transmitting a
proposed amendment to increase the Fund Balance from Previous Year account
by $10,000, and increase the Committee on the Status of Women expense account
by the same amount.
; and
Comm. 774.13: From Council Member Maile David, dated May 29, 2020, transmitting a proposed
amendment to add a CFE—Financial Navigator Program, Private Contribution
account for $78,000, and add a CFE—Financial Navigator Program expense
account for the same amount.
; and
Comm. 774.16: From Council Member Valerie T. Poindexter, dated June 2, 2020, transmitting a
proposed amendment to decrease the Office of Management Other Current
Expenses (Public Information Brochures) expense account by $10,000, and
increase the Committee on the Status of Women expense account by the same
amount.
; and
Comm. 774.17: From Council Member Maile David, dated June 2, 2020, transmitting a proposed
amendment to add a Bureau of Justice Assistance Coronavirus Emergency
Supplemental Fund Program account for $246,300, and add a Bureau of Justice
Assistance Coronavirus Emergency Supplemental Fund Program expense account
for the same amount.
; and
Comm. 774.18: From Council Member Herbert M. "Tim"Richards, III, dated June 3, 2020,
transmitting a proposed amendment to decrease the General Excise Tax Mass
Transit Equipment expense account by $5,408,632.
; and
Comm. 774.19: From Council Member Herbert M. "Tim"Richards, III, dated June 3, 2020,
transmitting a proposed amendment to decrease the Transfer to Capital Project
Fund-General Excise Tax expense account by $9,368,912.
; and
Comm. 774.21: From Council Member Herbert M. "Tim"Richards, III, dated June 4, 2020,
transmitting a proposed amendment to decrease the General Excise Tax Mass
Transit Equipment expense account by $4,408,632.
Motion to Approve: Ms. David moved to pass Bill 144, Draft 3, on second and
final reading. Seconded by Ms. Villegas.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: We have Mayor Kim here. Mayor, were you here to just watch
and listen, or did you want to say anything?
MR. KIM: (Inaudible.)
CHR. CHUNG: Okay. All right. So, let's go on to some amendments.
Comm. 774.12: From Council Member Valerie T. Poindexter, dated May 28, 2020, transmitting a
proposed amendment to increase the Fund Balance from Previous Year account
by $10,000, and increase the Committee on the Status of Women expense account
by the same amount.
Motion to Amend: Ms. Poindexter moved to amend Bill 144, Draft 3,with the
contents of Comm. 774.12. Seconded by Ms. Kierkiewicz.
CHR. CHUNG: Ms. Poindexter, go ahead.
MS. POINDEXTER: First of all, this committee is dedicated to, we all know, the
promotion of gender equality and the empowerment of women, but it was also
established by HRS (Hawai`i Revised Statutes) Chapter 367. So, we don't have
an option on this. We've got to act on this.
Where I'm struggling with is where do we take the money from and how much
money do we take because they were initially funded for 7,500 and the
Administration cut it down to zero. Every year, they have a luncheon called the
creative—Real Women and they have creative writing competitions. And with
this COVID-19 (Coronavirus Disease 2019)pandemic, it's going to be real
difficult for them to have that luncheon.
And the reason why I wanted to increase it is we know that it costs so much more
to try and do something virtually, a luncheon virtually, whether it's getting meals
to young women who are writing these essays. I don't know what they'll do.
That's up to the committee. But I know that there needs to be a slight increase in
that to help them deal with not being able to gather in one place and do this. It's
just going to cost a little bit more.
We've heard from the testifiers the things that they put out. So, when I looked at
this, I thought, "Oh, do I increase the Fund Balance"—it's increasing it—"or do I
look for money someplace else that we can replace it with?" And when I looked
at the Mayor's budget and I looked into the account that has 10,000 from the
contracts, and it was a public brochure or something, there was 10,000 from that
area. And I know that—public brochures, if they're going to do something, you
have the CARES (Coronavirus Aid, Relief, and Economic Security) money
coming in. So, those things can be filled at some other time.
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Hawaii County Council-43 June 4,2020
And I don't know what theI can ask the Mayor's Office what are those public
brochures. Because when we talk about public brochures, what is more important
than a public brochure like this that Bay Clinic was talking about? And it doesn't
only these brochures don't only go just for women. You have families that have
young men. So, these brochures, and things that they do overall, I see taking it
out of that other account.
So, this is what I'm going to ask the Council_ If I would withdraw this, I have
another communication coming up to amend it to take it from that other contract
amount so that I don't have to increase the Fund Balance. But we could balance it
out and just take it from somewhere else.
So, with that said, too, I just want to talk about how during this time of this
pandemic, there's a lot of stress in families. And the women are struggling.
Maybe they say the men are the breadwinners or whatever, but we should be
breadwinners, too. But we take on a lot, and there's so many people or women
being battered or mentally abused. And this committee right now, especially
during this time, needs to be an active committee to help us to get through these
difficult struggles that our women are facing. We're always struggling with
equality, always struggling with justice, the justice system, and how fair is that to
us as women.
I can say throughout my lifetime, too, I have been abused. There's the shame of
trying to come out and say, "Yeah, Ma, the black eye is not from me running into
the door." I was always trying to make excuses—or busted lip. So, I know what
it's like. And this committee is working with young women and older just all
women. But I really appreciate them working with our teens and our young
women in the schools so that they can have the support, and then guide them in
not allowing them to be battered. I was weak. So, we're building. With this
committee, we can help to build stronger women and more support for each other.
I'm must speak out of some of my own experiences.
So, I'd love to hear from the rest of the Council how do you want me to proceed.
Should we take it from our Fund Balance but it's increasing the Fund Balance
or should we take it out and balance it out somewhere else? And I found it in
some contract services. So, I just want to hear from the other Council Members
on how they want me to proceed and how do they feel about this committee and
how important it is. So, I'll yield at this time. Thank you, Chair.
CHR. CHUNG: Well, maybe I should throw this back at you, though. What is
your preference? Then we can go from there.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Right. My preference would be to take it out of
somewhere. I don't want to increase the Fund Balance. I would want to take it
from somewhere that will probably get other help from other ways through the
CARES Act.
CHR. CHUNG: Okay. So, let's work from there and, if need be, then we'll work
it back. Any comments? Mr. Richards, go ahead.
MR. RICHARDS: Yeah, thank you. First of all, thanks, Val. In this budget and
in this 800-some pages of what we paw through to find a line item like this that
I appreciate what the Administration did. We're trying to be fiscally minded and
we've done a lot of things, but I don't disagree with you. If you recall when we
had Dr. Bruce Anderson talking to us about the health and the impact of COVID,
he was actually as, if not more, concerned about the mental health of the
community as opposed to just the infection itself. And I've been very mindful of
that going forward. So, I think what you bring forth is excellent.
As far as funding to it, I'm supportive of taking the funding from the Fund
Balance. And the reason for that is I'm working on some stuff coming forward,
and I think, as one of our testifiers pointed out, relatively speaking it's a very
minor portion of our total budget. But if we have lots of those very minor things,
we have a huge impact on our budget I got that. We're trying to fix this thing
right now, and some of the things that I'm working on are a cash management, a
cashflow management deal. So, I think, for this and for the importance of it for
the mental health going forward and just for the support in its entirety, I
appreciate you bringing it forward. I'm going to support it. But I think if you did
it in Fund Balance, I think we can deal with that.
Now, they initially approved $7,500, and you're asking for $10,000. I would
strongly support $7,500, but I can be talked into $10,000. Your thoughts. And
before I totally weigh in, I want to hear other Council Members, as we know this
Council is six women, three men. And so, I do want to hear from the other
Council Members. So, Val, I totally appreciate you bringing this forward. Chair,
I yield.
CHR. CHUNG: Val, if I can ask you one more question before I call on Sue.
Which account were you looking to take it from? I wasn't listening.
MS. POINDEXTER: It's account balance, or what is it called, it's the OCE
(Other Current Expenses)—wait, let me just get that. Hang on. It's the one for
the public brochures under the Office of Management. Deanna, do you want to
explain—can you come up and explain what that public brochure ?
CHR. CHUNG: Well, I just wanted to know and then—well, maybe if she can
talk later.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Oh, okay. That's okay, Deanna. But it's the yes, let me
get the exact name of that account. I have the account number.
CHR. CHUNG: Maybe we should have Deanna come, and she can explain what
that account is all about.
(Note: At this time, Finance Director Deanna Sako came forward to
address the members of the Council.)
MS. SAKO: So, first of all, when we were balancing the budget, we just really
looked for things that were not mandated. However, sometimes we forget some
of these committees are created by State law, so we just want to apologize for
that. The account Val's talking about is the miscellaneous contract account for
the Mayor's Office, and there is a line for informational brochures. But the
Mayor also already cut that line item for the upcoming year. So, we're supportive
of taking it from Fund Balance because we should have left it in. That was our
bad. And if we had, we would have probably had to increase Fund Balance or
something like that to make sure we balance.
CHR. CHUNG: Okay. So, let me get this straight, then. The account that
Ms. Poindexter spoke of as an alternate to using the Fund Balance is zeroed out
presently?
MS. SAKO: No. It was cut I mean, he's already reduced it for the upcoming
budget.
CHR. CHUNG: Okay. Reduced it to what amount?
MS. SAKO: So, it was 101 in the current year, reduced down to 90,000 for the
upcoming year.
CHR. CHUNG: What is this account? What do you guys use that account for?
MS. SAKO: All the printing. All the different certificates. A lot of different
things. This year, the COVID brochures, we did find alternative funding for that.
So, they do try to charge it off to other sources whenever we can. But the Mayor
does need some money to operate.
CHR. CHUNG: Of course. But is this something that could be replenished with
the $80 million that we're getting if it's COVID-related?
MS. SAKO: Well, we're talking about the upcoming year, so it depends if they
were COVID-related brochures that needed to be produced or not.
CHR. CHUNG: So, it's possible.
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Hawaii County Council-43 June 4,2020
MS. SAKO: Right. But that's not the only thing
CHR. CHUNG: Of course. Yeah, right.
MS. SAKO: Happening in the County right now.
CHR. CHUNG: Okay. Ms. Lee Loy.
MS. LEE LOY: Thank you, Chair. Thank you, Val, for raising this issue. I'm
supportive of it coming from whatever just because as Deanna stated it, and I
appreciate acknowledging the oversight. But it is mandated by law, and we
should fulfill our obligations as it applies to the law.
I think in the fairness and equity issue that Ms. Poindexter raised, $10,000 on a
$585 million budget is .00001 for women. I think we—I'll support whatever this
Council wants, but going forward, I think we need to fund a whole lot more
money if we're talking about equity for women who have to demonstrate the
courage to stand up. So with that, I yield.
CHR. CHUNG: Ms. Kierkiewicz.
MS. KIERKIEWICZ: Thank you, Chair, and thank you, Val, for putting this
forward. As the immediate past president of the Zonta Club of Hilo, which is
committed to empowering women through service and advocacy, I'm a champion
of women's rights and making sure that we are creating spaces and opportunities
to let little girls know, "You can do and be whatever you want." And so, thank
you for bringing this forward.
I've worked closely with the Commission on the Status of Women in my capacity
as serving on Zonta; fully supportive of all of their efforts. I do want to say,
though, in alignment with Sue, I absolutely want to find ways in the coming years
to increase how we are supporting this organization. I think it's an opportunity to
take a look at what we fund as the Council through the grant-in-aid awarding
process. And so, keeping these important values in mind.
I'm going to support giving them $10,000; however, I do want to take it from
Fund Balance. And the only reason why I say that is when the Administration
was going through the first iteration of the budget,we saw our contingency fund
cut pretty deep. And so, Chair Chung was able to ensure that we had a bit more
money. And so, I see this as a dance between the Council and the Administration.
Ten thousand, drop in the bucket from Fund Balance. So, if we can just take it
from there, I think that's the easiest way to move forward. Thanks, Chair, I yield.
CHR. CHUNG: Ms. Poindexter.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Oh, I didn't know my light was on, but I'll give Kona a
chance.
MS. DAVID: Chair Chung?
CHR. CHUNG: Who's that?
MS. DAVID: Hi, Maile.
CHR. CHUNG: Oh, Maile,please. Go ahead.
MS. DAVID: I just want to say thank you to Val for actually discovering this and
discovering that this is something that is statutorily required. I think, for that
matter, I really praise you for bringing that awareness to us. For me, I support
you 100 percent and women's struggles over the generations. We've come a long
way, but we have a long way yet to go. And so, thank you, Val, and I do support
this coming from the Fund Balance because I think, like, it's the minute amount
like was mentioned. So, thank you again, Val, and I support this. Thanks.
CHR. CHUNG: Thank you. Anyone else in Kona?
MS. EOFF: I'm just going to say pretty much the same thing. And if the Finance
Director is sort of advocating for the Fund Balance, this would be the
Communication 774.12, I can support that. And mahalo, Val.
CHR. CHUNG: Okay. Rebecca.
MS. VILLEGAS: Yes, thank you, Chair Chung. Mahalo, Val. Thank you so
much for identifying this accidentally overlooked spend that is vitally important,
especially at this time. So much of the burden of a crisis like COVID-19 does fall
on the backs of women, and I am so grateful to be a woman in this time and this
era and this generation. And I'm extremely hopeful for my daughters and,
someday, my granddaughters. Val, thank you for doing this, for setting aside.
I completely agree that this is a manini amount of money, which at this point
we're counting pennies under every circumstance. But in that broader scope of
things, I'm in support of my fellow Council Members. And the decision of if the
Fund Balance is the best place to take it from, then I do support that; however, I
will defer to Val's decision to that as she brought this forward.
And I just also want to express how grateful I am to have had somebody present
me with a document called, `Building Bridges, Not Walking on Backs." And it's
a feminist economic recovery plan for COVID-19 that was put out by the Hawaii
State Commission on the Status of Women, Department of Hunan Services in the
State of Hawaii. And I am encouraged to see documents like this and
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Hawaii County Council-43 June 4,2020
explorations in the recognition of the vital role that women play and the support
necessary to keep our communities moving in the right direction. So, thank you
so much for that, Val, and I support this wholeheartedly. Mahalo.
CHR. CHUNG: Matt.
MR. KANEALI`I-KLEINFELDER: Val, I think you did a wonderful job in
digging into a budget that is overwhelming and finding one line item in the
middle of all of it that needed to be funded above others. Some of the most
important women in my life have been abused in different ways, and knowing that
we can put some funds on the side to help alleviate that in any way possible is
extremely important. And I would say that I would ask for more than $10,000. I
would put more in there. Like Sue said, this is a point—yeah, less than 1 percent
of our budget. So, you take what you need and you put it in that account, and we
help empower women and not marginalize them, as was said by our testifiers.
Mahalo.
CHR. CHUNG: Val, you want to say anything else?
MS. POINDEXTER: I just want to say I appreciate how you recognize that this
committee has been so unfunded—not unfunded. Their funds have been very
minimal throughout the years, and I think it's time that we start supporting this
more. So, I agree, like, giving more money to it. Right now, we'll start off with
$10,000, and I'm hoping that Administration is hearing the testifiers, hearing all
of the Council Members and how we feel about this committee, especially in
these trying times.
So, the CARES money, when those millions come in, consider how you can help
throw some funds towards this cause because it's important. It's part of our
recovery, especially during this pandemic. So, I'm hoping that some of that
CARES funding can go towards this to help them boost the things that they need
to do to reach out to a lot more women. And like I said, it's not just women
they're helping. There's families, children, men; I mean, they don't discriminate.
This committee does not discriminate. I've seen that at the luncheons where they
include men. So, I know what this—it's about equality.
And I want to thank my staff, Sunshine, and LRB (Legislative Research Branch)
staff Donna. God. I put them through hell with this because I said, "Okay, I
going withdraw this. Let's find money somewhere else." And Sunshine's
digging and Donna's helping. So,just my mahalo to them, our LRB team,just
amazing. Couldn't do anything without you.
And then a big shoutout to Farrah-Marie Gomes because it's our community who
finds these things. Last year, I had Aunty Lucille telling me, "Hey, the Police
budget didn't include Laupahoehoe." This year, I'm getting calls and I talked
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Hawaii County Council-43 June 4,2020
with Farrah, and Farrah's going, "Whoa, did you guys cut committees right across
the board?" And that's what got me looking into this and digging into this and
seeing that we should have had that money in anyway because it's required by
law. But yet, it's so underfunded. But at least getting it up to 10,000 right now is
good enough to get them through until CARES money comes in and the
Administration works with them to kind of help boost that program. Sorry, Chair,
I'm going over and over.
CHR. CHUNG: No, no. This is your
MS. POINDEXTER: I'm waiting for you to cut me off. Thank you. I appreciate
each and every one of you on this Council as we work as a team to get this budget
through and take care of our priority items. So, mahalo.
CHR. CHUNG: Okay, anyone else? So, I'm assuming we're just going to stick
with the motion that's on the floor.
MS. POINDEXTER: Yes.
CHR. CHUNG: Okay. Back in 1988, over 30 years, yeah, well over 30 years
ago, almost 40 years, I had been one year into my work with the Corporation
Counsel's office. And I was assigned to the Committee on the Status of Women,
and that's when that committee was really in its infancy. And this same sort of
issue came up about the funding, and so, I'm very familiar with it. And you're
right, this is a requirement. And I'm glad that you picked it up.
I think we need look no further than this body and in Kona to see how far women
have come. We have people like you and you and you and them, all iron
maidens. And when I hear Sue's voice cracking, you can tell how emotional this
kind of issue is, really. So, Rebecca mentioned that during these times, these
COVID times, we have to take a different look at things, but it's not really more
than COVID. If you look at the sign of the times, it's all about equality, really.
That's what's happening. It's the scourge of the nation right now.
And I think more than ever we should be supporting something like this. I would
have preferred taking it from real money, quite frankly, rather than the Fund
Balance because I disagreeI mean, I agree that,yeah, it's a manini amount. But
manini, manini, manini a lot, then it becomes a big amount. But that's just my
thought. But it looks like the preference on this body is to go ahead with taking it
from the Fund Balance, and the sponsor of this bill is in agreement with that. So,
I'm certainly in agreement with it as well. So, why don't we take a vote, okay?
You want to do it by roll call,just as a symbolic gesture, today?
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Hawaii County Council-43 June 4,2020
Vote on Motion The motion to amend Bill 144, Draft 3, with the contents of
to Amend: Comm. 774.12 was carried by the following roll call vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Thank you very much. Ms. Poindexter, congratulations.
MS. POINDEXTER: Mahalo. Thank you, Chair.
CHR. CHUNG: Okay, now, we don't have anything else, but I know we have
some things coming down the pipe. So, who wants to start off?
MR. HENRICKS: The next item we have is Memo No. 2,
Communication 774.13.
Comm. 774.13: From Council Member Maile David, dated May 29, 2020, transmitting a proposed
amendment to add a CFE–Financial Navigator Program, Private Contribution
account for $78,000, and add a CFE–Financial Navigator Program expense
account for the same amount.
Motion to Amend: Ms. David moved to amend Bill 144, Draft 3, with the
contents of Comm. 774.13. Seconded by Ms. Lee Loy.
CHR. CHUNG: Ms. David, go ahead.
MS. DAVID: Thank you. I believe—is Director Sako still there? Because this
was one of those last-minute grants that we were asked to include on the agenda,
and I'd like her just to explain it briefly. Thank you.
MS. SAKO: Yes, we were made aware recently of two new grants, and we just
want to get it in the budget so the departments can start spending that effective
July 1st. And we don't have to come back and amend, which would delay the
spending. I believe both are COVID related, and so we're anxious to get moving
on both of them. So, I believe it's Memos 2 and 4. But if you have any
questions, we're happy to answer them. This one is on the Financial Navigator
program, similar to our financial empowerment one.
CHR. CHUNG: Okay, anyone else?
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Hawaii County Council-43 June 4,2020
MS. DAVID: Thank you, Ms. Sako. I yield.
CHR. CHUNG: So, this all balances out, right? Yeah, okay.
MS. SAKO: Grant revenue offsets the expenditures.
CHR. CHUNG: Right, okay. Any further discussion? There being none, all
those in favor say "aye."
Vote on Motion The motion to amend Bill 144, Draft 3, with the contents of
to Amend: Comm. 774.13 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. Next.
MR. HENRICKS: The next item would be Memo No. 3, Communication 774.16,
submitted by Ms. Poindexter.
Comm. 774.16: From Council Member Valerie T. Poindexter, dated June 2, 2020, transmitting a
proposed amendment to increase the Office of Management Other Current
Expenses, Miscellaneous Contract Services account by $10,000, and increase the
Committee on the Status of Women expenditure account for the same amount.
CHR. CHUNG: That's out, right?
Withdraw MS. POINDEXTER: No, that's out, yeah. I'm going to withdraw.
Comm. 774.16:
CHR. CHUNG: Okay.
MR. HENRICKS: Okay, it's been withdrawn. Memo No. 4, Communication
Number 774.17, submitted by Ms. David, by request.
Comm. 774.17: From Council Member Maile David, dated June 2, 2020, transmitting a proposed
amendment to add a Bureau of Justice Assistance Coronavirus Emergency
Supplemental Fund Program account for $246,300, and add a Bureau of Justice
Assistance Coronavirus Emergency Supplemental Fund Program expense account
for the same amount.
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Hawaii County Council-43 June 4,2020
Motion to Amend: Ms. David moved to amend Bill 144, Draft 3, with the
contents of Comm. 774.17. Seconded by Ms. Lee Loy.
CHR. CHUNG: Ms. David.
MS. DAVID: Yes, and I believe, Director Sako, this is the one you were
referencing to in funds in grant.
MS. SAKO: Yes, this is the Bureau of Justice grant, specifically related to
coronavirus and PPE(Personal Protective Equipment) and other items that the
Police Department can utilize.
MS. DAVID: Thank you very much.
CHR. CHUNG: Okay. Anyone else? There being none, all those in favor say
LC "
aye.
Vote on Motion The motion to amend Bill 144, Draft 3, with the contents of
to Amend: Comm. 774.17 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
Comm. 774.18: From Council Member Herbert M. "Tim"Richards, III, dated June 3, 2020,
transmitting a proposed amendment to decrease the General Excise Tax Mass
Transit Equipment expense account by $5,408,632.
Motion to Amend: Mr. Richards moved to amend Bill 144, Draft 3, with the
contents of Comm. 774.18. Seconded by Ms. Lee Loy.
CHR. CHUNG: Go ahead.
MR. RICHARDS: Okay, Chair, I had a quick amendment. I worked with
Finance on this, and I was going to—I have an amendment to this one that
changes that total from 5.4 to 4.4. So, Clerk, how do we go forward? I know it's
been processed, but I don't see it coming through yet, so we don't have the paper
before us.
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Hawaii County Council-43 June 4,2020
MR. HENRICKS: You have it in—it's being worked on as far as submitting a
different memorandum?
MR. RICHARDS: Yes.
MR. HENRICKS: Okay,just withdraw this one, then. Withdraw your motion
and then we'll wait until that comes around.
MR. RICHARDS: Okay, Chair, I withdraw.
CHR. CHUNG: Or do you want to talk about it right now?
MR. RICHARDS: I can do that. Yeah, it's very simple.
CHR. CHUNG: Then, when it comes
MR. RICHARDS: Then I can withdraw and do that. That's fine. Latitude,
Chair?
MS. KIERKIEWICZ: I thought we got it.
CHR. CHUNG: Sorry?
MS. KIERKIEWICZ: We already got it.
MR. RICHARDS: You got it?
MR. HENRICKS: If you want to withdraw and then make the motion for .21,
apparently it's available.
MR. RICHARDS: Okay. I don't have it.
CHR. CHUNG: Where is it?
MS. KIERKIEWICZ: 774.21.
MR. RICHARDS: Oh, yeah, okay, I withdraw.
CHR. CHUNG: I don't have it. That's all right. I trust you guys.
MS. KIERKIEWICZ: No, it's right here.
CHR. CHUNG: Oh, here it is. Thank you.
MR. RICHARDS: Everybody gets it but the Chair.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Thank you.
Withdraw Motion MR. RICHARDS: So, Chair, I'd like to withdraw 774.18 and replace it
to Amend: with 774.21.
CHR. CHUNG: Alright.
MR. HENRICKS: So, Mr. Richards, your motion is to amend with 774.21.
MR. RICHARDS: That is correct.
CHR. CHUNG: So, he's withdrawing, though, 774.18, right?
MR. HENRICKS: Correct. That is no longer on the floor.
CHR. CHUNG: Okay, that's out. Okay, go ahead, Mr. Richards.
(Note: Comms. 774.19 and 774.20 were taken up later in the proceedings.)
Comm. 774.21: From Council Member Herbert M. "Tim"Richards, III, dated June 4, 2020,
transmitting a proposed amendment to decrease the General Excise Tax Mass
Transit Equipment expense account by $4,408,632.
Motion to Amend: Mr. Richards moved to amend Bill 144, Draft 3, with the
contents of Comm. 774.21. Seconded by Ms. Lee Loy.
CHR. CHUNG: Go ahead.
MR. RICHARDS: Okay, thank you, Chair. This is going to be an interesting
conversation going forward. And what I was doing is, as I mentioned in our
previous budget hearings, it seems like each year our budget process is very
different than the year previous. And what I was looking for is how we're going
to manage our cashflow coming forward. And the reality is this really is a
cashflow management tool that we're trying to get done. The initial one that I had
proposed was to decrease the expense of GE(General Excise) Mass Transit
equipment of 5.4 million and the replacement of this in Communication 774.21 is
for 4.4 million. And the difference there is the $1 million leaving for Federal
matching funds to obtain some of the equipment that we have to have with the
Federal matching fund.
Now, again working with Finance on this, let me explain. It's a little confusing.
What I am working towards—and I ran this through LRB and I've discussed this
with Corp. (Corporation) Counsel the intention here is to essentially defund
Mass Transit, this equipment. And the reason I want to defund it right now is
strictly cash management. We had, yesterday, Resolution 352 [sic],
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Hawaii County Council-43 June 4,2020
corresponding Bill 174 and Resolution 653, Bill 175. Resolution 652 was for
$5.1 million for the purchase of ten buses. Resolution 653 was for $4.4 million
for Mass Transit for loss of revenue and operating expenses going forward.
We have the cash coming through from that side right now. Our revenues—and
this is no secret I am concerned that our GE revenue stream will not be what is
projected. So, as I stated previously, what I wanted to do is cut our budget so
we're living within our means very conservatively now. And with that, what that
does is it reduces our overall budget between this cut as well as the decrease I
have coming forth in the next communication of approximately $14 million.
What that does is it drops our overall expenditure from 585 down to $571 million.
The idea here is that we are not going to totally gut Mass Transit because though
I'm one of its biggest critics, I'm also one of its biggest supporters. We have the
bus ability to purchase coming forward, and if you notice, I have not touched
anything as far as the funding with the contracts and with any of the employees.
What I want to do is fix what we have, buy the new ones, and get this thing up
and running. But this is a cash management tool. And again, it's a little unique in
the fact of what I'm doing is defunding this and leaving the funds in the GE Fund
Balance from last year and then coming forth for next year.
Assuming our economy bounces back and the GE cash flow comes back, then we
can re-appropriate and put this stuff back in, if we have the funds. Again, I've
worked this out with Deanna, and she's good with it but again, we talked about
the $1 million for the federal match. So that's the idea. This is a cash flow
management tool where we're not sure we're going to have the funding, and
under our Charter it specifically states we must have revenues higher than
expenses. Not that they match, as long as the revenues are higher than expenses.
So under our Charter, this is allowed. And it's a little different way of doing it,
but it is very similar to when we defund positions that are vacant. Rather than
keeping that in the budget, we defund the position. This is a similar thought
process.
So I hope, and it took me a long time to get to this. I hope people are
understanding what it is. It's defunding it, not allocating the funds anywhere.
Leaving them in the fund balance that may come forward. And Val, this is what I
was thinking as we go through this, finding the funding for you. That's why I'm
all for the fund balance. Because I think we can rearrange things. So with that,
Chair, I'd like to open it up to my Council members, and answer questions if they
want to have a better understanding of what I'm thinking.
CHR. CHUNG: Okay. Interesting. Very interesting. Deanna, can you weigh in
on this? The first question is whether the reduction, anticipated reduction in our
GET was built into the amended budget.
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Hawaii County Council-43 June 4,2020
MS. SAKO: So on the first question, we reduced revenue by the GET estimate by
25 percent. So we did factor some of that in. None of us have a way of knowing
at this moment what the exact reduction is going to be. The State system is kind
of behind in its reporting, so I think they're only up to February which was prior
to COVID. So we don't have the exact amount. Yes, and I think I even
mentioned at first reading that, you know, we're not positive on that amount. We
did our best to estimate the 25 percent reduction, but it was to be reduced more,
we would not do the transfer to capital projects fund.
So I get what Mr. Richards' trying to do. But just to clarify, it's not kind of
sitting in fund balance. Right now, the offset to this expenditure is actually sitting
in the General Excise Tax revenue, the GET revenue account.
So you know, I'm a debit before credits kind of person and so I kind of prefer
when things match. You know, it's just my nature as an accountant. So we
would probably reduce revenue at the same time of reducing the expenditures and
come back later and ask to appropriate. But we did talk to Corporation Counsel
and the way Mr. Richards is doing it, it is allowable.
CHR. CHUNG: Okay. So this is not a matter of reducing our expenditures, it's
just moving something from one account and pocketing it—
MS.
tMS. SAKO: No, it's reducing the expenditures but not the revenue, this
amendment.
CHR. CHUNG: I mean, well the expenditures in a particular operation, right?
It's an operational issue when you take it out of the Mass Transit equipment.
MS. SAKO: Right. So right now he's removing all of these except the $1 million
federal grant match. So they would not be able to buy any of these buses until it's
put back by Council.
CHR. CHUNG: Right, but is this going to have any effect on our rates? Nothing,
right? Because you're not reducing the expenditures of the overall budget, right?
It's just moving something from one account and pocketing it somewhere else.
MS. SAKO: Oh, the tax rates? I'm sorry. Sorry. We'll it is going to reduce the
overall expenditures in the budget, but this is specifically in the GET Fund so it's
not going to reduce the real property tax rates for the General Fund.
CHR. CHUNG: Right. Okay, I just wanted to make sure. Okay, but you're okay
with this arrangement then?
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Hawaii County Council-43 June 4,2020
MS. SAKO: Yeah, and we called Corporation Counsel together to understand
that it is okay, and then if let's say maybe there's only a 10 percent reduction in
GET, which I don't think will happen, you know, at that time we can come back
and ask to reinstate these expenditures.
CHR. CHUNG: Right. Okay, because I just wanted to get that out on the table.
Because I don't want to have anyone here being misled into thinking this is going
to have an effect on the rates. Because we need more fundamental items
occurring if that is to come about, right?
MS. SAKO: Right, correct.
CHR. CHUNG: Okay.
MS. EOFF: Mr. Chung?
CHR. CHUNG: Yes, Ms. Villegas.
MS. EOFF: Sometimes it's a little bit hard to understand everything over there.
Could you just make that statement one more time? My understanding is that—
and
hatand thank you, Mr. Richards. So we are reducing the amount of money in Mass
Transit for this equipment by $4.4 million. That does reduce the bottom line of
the budget, the total budget in the operational budget, correct?
CHR. CHUNG: Correct.
MS. EOFF: Okay, but one thing there was an article in the paper today and
we've been approving money, I think it was just yesterday, for purchasing of
buses, so in some ways, this is a pretty fair reduction. And like Ms. Sako said,
later on as monies free up or more money is hopefully there from GE, we will be
able to purchase the buses that we need all in all. So is this what I'm hearing, is
this works? I just want to make sure Ms. Sako is
MS. SAKO: Yes, it works, and you know Transit has been very successful in
getting grants. So hopefully that will be sufficient. But if not, the budget was
established in accordance with the Mass Transit Master Plan. So you know, yeah.
So we're just waiting to see if we have enough revenue.
MS. EOFF: And Mr. Richards also pointed out that we have a lot of unknowns
too still, coming forward from this COVID situation from the Feds to the State to
us. So we will probably see being able to replace some of this going through the
next fiscal year, is my understanding of Mr. Richards' thinking. So if that's what
I heard? I just wanted to clarify what I heard, because I missed a little bit I think
in the transmission. But thanks. Go ahead and counter my understanding if I
misread it.
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Hawaii County Council-43 June 4,2020
MR. RICHARDS: Chair?
CHR. CHUNG: Yeah, okay. Mr. Richards, go ahead.
MR. RICHARDS: Karen, you're spot on, on that. Correct. I'm not sure, the
official term would be "supplant the funding,"but essentially because we have
that federal grant coming forth, we are able to keep going with our plan. It's just
delayed a little bit because of a cash flow. So it's a cash-flow management.
MS. EOFF: Right. Well, I think this is a creative proposal, and I'd like to hear
what everybody else says about it. Thank you.
CHR. CHUNG: Matt?
MS. DAVID: Mr. Chair? Chair Chung?
CHR. CHUNG: Matt's going to talk first.
MS. DAVID: Oh, go ahead. Thanks.
MR. KANEALI`I-KLEINFELDER: Okay. Tim, I appreciate what you did here.
We talk about where to cut and how to cut and then you did. You found a place
to cut. I don't agree with this, though. I've got to say that. Mass Transit,
although we did pass a bill or a resolution yesterday to increase funding to by
10 buses, from what I remember in my last conversation with Brenda is we had
13 to 20 buses. She needs about 55 to run her department correctly. So even with
an increase of let's say 15 buses, that still puts us in the range of, if I was to over
exaggerate, I'd say running about 25 to 30 buses that we would have when we get
the ones we're about to purchase, which could be a year or so.
So we're still running about half capacity on our buses. So to decrease funding
for bus replacement at the tune of$4 million, to me it's heavy. We're setting
back a department that we've continued to set back as I've been in office, and
Brenda's been dealing with that, and I know she's had some frustrations with us
and what we've done in our previous budget talks.
Some of the smaller items, I think you're making good cuts, but those aren't
going to equal out to your larger $4.4 million that you're trying to reduce the
budget by.
Then the bus tow truck was also something she really, really wanted because
although we have one in other departments, I believe the departments do not share
their equipment, and when a bus breaks down, we have to pay for the tow. And
it's expensive. To tow a bus is not cheap. So when we pay for those tows, one,
we're out a bus. The people waiting on that bus don't have one. And then we
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Hawaii County Council-43 June 4,2020
have to pay a private company to come in and tow our vehicle for us. So it's kind
of ait gets messy real quickly when we have a broken bus. A lot of things fall
apart.
So while I appreciate what you've done, I do not agree with cutting back in this
area. And as Deanna said, they did account for a proposed drop in our GET
revenue in the budget that was submitted to us, but you've gone ahead and you've
cut more from that proposed drop now. And if we're talking about COVID-19,
moving forward if people don't have extra funds in their wallet, they may be
utilizing our public transportation more. I think it's a good time to focus on
providing more services and not taking away from any services that we could
offer or equipment that we could offer as well.
That's my thoughts. Again, I appreciate what you're doing, because it's not
hardI mean, it's hard to go through this budget and figure out where to cut
without feeling like you're taking away from someone else. But you did, and you
put it out there, and I appreciate that. But in this area, I feel like we need to help.
So many times, we need to help support this department and not detract from this
department. I appreciate everyone's comments so far. Those are my thoughts,
and again, I appreciate what you've done, Tim. Thank you.
CHR. CHUNG: Rebecca.
MS. DAVID: That was me. Maile.
CHR. CHUNG: Oh, Maile. Go ahead, please.
MS. DAVID: First, thank you, Tim. I think this is very creative. From what I'm
hearing and especially since Mr. Kaneali`i-Kleinfelder weighed in on this, I
correct me if I'm wrong. Deanna, this is a this method is pretty much temporary
until we can figure out in the new fiscal year where we can start to put these
things back, right, this funding back, right? Because it was taken out I mean, it
was these line item costs were what was recommended in the master plan, and
had COVID not even affected us or became a reality, then we would be moving
along with these line items as we could get the money from GE and stuff like that.
But this is a temporary adjustment is what I'm hearing, and I just wanted to make
sure that's what this is. We're not—
MS.
otMS. SAKO: Right. We would have to come back to Council to put it back in.
So initially my thought was just to not do the transfer to Capital Project Fund
which, as I believe is another memo that's on your agenda coming up. And if we
didn't do that transfer to capital project fund along with the reduction we already
took, we would be at a 43.8 percent reduction in revenue. So at that point we felt
it was safe that we would hope it wouldn't, you know, be reduced even below
that. But you know, it's up to the Council. But you know, I think I'm a little
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Hawaii County Council-43 June 4,2020
more supportive of the next memo. That's sort of what our plan had been, and at
that point we would get a 43 percent reduction. We don't want to tie Brenda's
hands, but I understand Mr. Richards' concerns about cash flow.
MS. DAVID: Right. I see. Okay, thanks for that clarification. So when we get
to the next one, you'll be explaining that a little bit better, or in more detail. So I
think what Ms. Eoff's understanding is what my understanding was, along those
lines also. So I just, like I said, Mr. Richards, your work in this complicated
issue, budget, I really have to applaud you on this one. I really believe that we all
feel that our Mass Transit Department is very critical to this island, especially in
our rural districts. So I don't believe there's an intention to shortchange that
department, if we have some form of resolve after the fiscal year passes. So, I
mean, our new fiscal year comes into play.
MS. SAKO: So I ran the numbers, and if this amendment and the next one as
well as the reduction we already took all passed, that would be assuming a 52, or
almost 53 percent reduction in revenue. So we were comfortable with the
43.8 percent reduction, but of course anybody's guess is as good as someone
else's. It's very uncertain right now.
MS. DAVID: Right. So then we'd have to address that after the fact, right?
MS. SAKO: Correct.
MS. DAVID: Okay. Alright, for now I'm comfortable with what I've seen
before us right now. And again, thank you, Mr. Richards, for your efforts in this
very complicated budget process. Thank you.
CHR. CHUNG: Ms. Lee Loy.
MS. LEE LOY: Thank you, Chair. Deanna, because I'm trying to keep it straight
in my head also, because this particular memo is related just to GE, right, it's just
that one restricted fund that has its own type of guardrail—and like
Ms. Kierkiewicz said, it's kind of like the stance, how we move things around.
Because GE is a restricted fund, and it has its own type of guardrails—and I'm
looking at the Charter, specifically Section 10.5, and when I read that, that says
basically we have to have revenues, but our expenses don't have to necessarily
match the revenues. It has to be equal to, but it could be less than.
MS. SAKO: That's correct, and that's what we confirmed with Corp. Counsel
this morning also.
MS. LEE LOY: Okay. So with this amendment,we're basically—and help me
with this—we're understanding it to mean we had some line item expenses based
on a projected revenue assumption just for GE.
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Hawaii County Council-43 June 4,2020
MS. SAKO: Yes.
MS. LEE LOY: Yes. So if we get more revenue but have less expenses, you'll
come back and we'll make it match, correct?
MS. SAKO: Yes, once we get far enough into the fiscal year to know what the
projections look like.
MS. LEE LOY: So six months from now when the economy or not—
MS.
otMS. SAKO: Or not, right.
MS. LEE LOY: We're going to have to have this dance perhaps again. Because
if the revenue projections are less than the expenditure projections, we're going to
be having this conversation again.
MS. SAKO: Right.
MS. LEE LOY: Okay. You know, Mr. Richards, I too agree with this. But I'm
wondering if we could have a more robust discussion and lay this one on the
table. Because I notice you have a second one, and I think Ms. Sako alluded to it.
She is more supportive of the next memo, which is $9 million. For me there's
more wiggle in $9 million than there is in $5. That's my suggestion. I kind of
want to have this conversation with all the cards on the table, where we can pick
and choose. But I am continuing to listen to the rest of my colleagues. So with
that, I yield.
CHR. CHUNG: Ms. Poindexter.
MS. POINDEXTER: Yeah, question. You know, I hear what Council Member
Matt Kaneali`i-Kleinfelder stated. So holding off these expenses for six months
and even longer, did we ask Brenda how it would affect her department, how it
would affect the master plan. I mean, how would they be set back.
MS. SAKO: So Mr. Richards and I only talked this morning, so no, I didn't get a
chance to call her. But we can call and ask her, or if you guys want to take a short
recess, or Steve can go out and call her.
MS. POINDEXTER: I think either a short recess or what Council Member Lee
Loy had stated on tabling it so that we can get more information, because I don't
want to just vote on this because I've been struggling with transportation out in
our rural area. And I've been on the phone with Brenda and some of our
constituents and working up more buses out there, especially now with COVID
and the pandemic, you cannot fill the buses right, because they've got to be six
feet apart. So we're sending more buses out.
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Hawaii County Council-43 June 4,2020
MS. SAKO: And those buses are expensive. I mean, we do have to pay for them.
MS. POINDEXTER: So how does this impact her, especially now when she's
needing more buses than even the master plan had said. The master plan was
developed before they knew we had a pandemic coming. So all these expenses
that Brenda is going through right now was not even budgeted for. I mean it was
unforeseen.
MS. SAKO: So fortunately that's also one of the grants you guys looked at
yesterday was that she did get CARES Act money for that. So that's hopefully
paying for the extra services we need.
MS. POINDEXTER: Extra stuff, right.
MS. SAKO: As well as the cleaning, the disinfecting, the PPE, and all of that. So
then these buses would replace the ones that Mr. Kaneali`i-Kleinfelder was
discussing, which is the ones for our regular routes. So yes.
MS. POINDEXTER: Right. Because so we need to still address that, yes. Good
that we're getting some money to pay back some of the extra expenses. But now
that we need to beef up the transportation to get it where we need to be, would
this affect it? You know, and that's of concern.
MS. SAKO: And it would definitely affect the timing.
MS. POINDEXTER: It's just bad timing. It's just unfortunate. But I yield at this
time.
CHR. CHUNG: Deanna, is this amendment and the one that follows, that 774.19,
are they mutually exclusive, or compatible? Is it one or the other, or what?
MS. SAKO: No, I mean it could be one or the other, but it could also be both. I
mean, is what Mr. Richards is saying. So if both of them happened, that would be
an expectation of 52.6 percent in revenue; and if what we had already
CHR. CHUNG: GET derived revenue.
MS. SAKO: GET only, yes.
CHR. CHUNG: Right.
MS. SAKO: And then if we didn't do this amendment but did the
Communication 774.19, that would be a total of 44.8 percent revenue reduction.
And a lot of it is dependent on when tourism starts to come back to our islands as
well.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Okay, right. Mr. Richards.
MR. RICHARDS: Thank you, Chair.
CHR. CHUNG: You know what? You spoke twice already, right? Let me go to
Matt. Oh, I'm so sorry. Ashley, go ahead.
MS. KIERKIEWICZ: Thank you, Chair. Tim, I'm a huge fan of yours. You and
I are big champions of fiscal responsibility. But I keep thinking back to last year
when the Legislature gave us the opportunity to help ourselves with an additional
revenue stream with GET specifically to address our transportation and Mass
Transit issues. I mean, had a lot of issues over the year with that agency. Now
we finally have a director that is resourceful and innovative and motivates staff
and is getting the job done. If we pass this, we are taking away critical tools that
we know we need to really implement the Mass Transit Master Plan and create a
public transportation system that is truly going to work for our island.
You know, I heard you on HPR (Hawai`i Public Radio) this morning talking
about we've got to do everything that we can to get tourism back and working for
our economy. So many of the individuals that work at these resorts live in the
districts that Matt and I represent. They rely on the transportation system to get
there. So by taking this away, I think it's just going to make it more difficult for
us to really put together that mass transit system we need. This adversely affects
rural communities and it's only going to exacerbate the inequities that we are
feeling, even more so right now with this pandemic.
So I appreciate the bold courageous move that you've done here with this
particular amendment, but I can't support it. It's tough for me to say that because
I'm a big fan of yours. I would rather much take a look at the other amendment
that you have on the floor, in order to find ways to kind of decrease some of our
expenditures. So thank you. I think we're still friends here though, right? Chair,
I yield.
MR. RICHARDS: Yes, we're still friends.
CHR. CHUNG: Matt.
MR. KANEALI`I-KLEINFELDER: I'm looking at—bus replacement means we
replace existing buses, or we fix existing buses?
MS. SAKO: These are replacement buses. The repairs are in a different portion
of the budget.
MR. KANEALI`I-KLEINFELDER: Okay, so this is replacement of existing
buses, so if we're not replacing buses, then what are we doing?
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Hawaii County Council-43 June 4,2020
MS. SAKO: Then we have to fix them.
MR. KANEALI`I-KLEINFELDER: But if we don't have a bus, we are going to
be
MS. SAKO: Then we have to pay our current vendor, which is Roberts, to supply
the bus.
MR. KANEALI`I-KLEINFELDER: So then potentially we could be actually, by
not replacing these buses and using a GE fund that is set aside specifically for
Mass Transit, we're not going to utilize the funding that was given to us by
Legislature as Ms. Kierkiewicz, you know, reinforced, and then have to pay a
vendor more to keep us afloat, or wait for more buses.
MS. SAKO: To keep the buses on the road basically, yes.
MR. KANEALI`I-KLEINFELDER: So there's a lot tied into this. Okay, I cannot
support this. Tim, I do appreciate what you did. In this case, I cannot support it.
And yeah, like she said, I hope we're still friends, but that's how I feel.
CHR. CHUNG: Tim.
MR. RICHARDS: Okay, thank you. First of all, there's a little bit of a
misunderstanding. I'm not, not supporting it. What I'm doing is delaying it. I
am delaying it, and it comes down to cash flow management. If you look at the
GE revenue projections, as Deanna has said, that's $37.5 million coming forth
which is a 25 percent reduction of the projected $50 million. In order to have a
$50 million GE revenue collection, that implies we have a $10 billion economy in
the County. Yes, I'm going through my numbers.
We as best can figure, have about$8.5 billion. Of that$8.5 billion, $3 billion
came out of tourism. So let's just pick a round number, $5 or $6 billion right
now. My concern is we do not have the revenue stream coming forward. I am all
supportive of Mass Transit for the exact reasons that you, both Ashley and Matt,
are articulating. We need the Mass Transit to get people to work. Once we get
this reopening—and we have to press for a scheduled reopening, but that's
different conversation—if we don't reopen in a timely fashion, we probably are
going to lose some of the resorts, thereby lose the employment. And also, we're
probably going to lose the participants, the tourism coming because they're going
to be seeking other places. That's a different conversation.
My concern is to go forward and make sure that we match our projected expenses
to what is a realistic projected revenue stream. Thirty-seven million implies a
$7.5 billion economy. We don't have it. We do not have it right now. And what
I want to do is cash flow management. I'm all for re-appropriating this. If the
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Hawaii County Council-43 June 4,2020
money comes forth and we have it in GE, I want to put it back. Luckily, we were
able to approve the funding and purchase of 10 buses coming forth. Right now on
a given day, you know Matt, you and I have both talked to Brenda, she has
between 12 and 15 buses a day running that we own. And we contract, total
number needed, I think we have 35 routes to be fully staffed and fully running
right now. So we're contracting about two-thirds of what we're doing.
Specifically, I didn't touch the funding for all that contract work for that exact
reason, because we need that. And I couldn't agree with you more, we need to
have those buses running to get going. What this does is it defunds the capital
investment for about six months to see if we have the revenue stream coming
forward. If we do, great. Let's bring it back and put it back on the table. It's
going to take 18 months to get these buses here anyway, maybe longer. So what
it's doing is it's managing cash flow at this point to go forward and balance it
with the projections.
So with that, I hear what you're saying. I completely agree with you as far as
needing Mass Transit. And this isn't cutting it. It's cash management and cash
flow going forward. So I appreciate the concerns, but I think if we're going to be
realistic, because in three months by now if we don't have the economy running
and we don't have the funding come forth, we're going to be coming back and
cutting something. That's my concern. The general belief is that we're going to
need about a 20 percent cut in our budgets. Right now if this goes forth with
these two, that'll be another $14 million rough numbers, which is about a
10 percent.
I'm still concerned we're not going to make it on that one, but it's better than less
and I'd rather cut now and re-appropriate later assuming we have the funding
coming forth as opposed to not cutting now and then facing making really tough
decisions later. That's why I bring this forth. But I totally appreciate the
conversations. And the short answer is yes, Matt, we still are friends. Chair, I
yield.
CHR. CHUNG: Anyone in Kona? Basically now as I understand it, Sunshine
Law being as it is, you know, we never get to look at these things ahead of time,
right?
MR. RICHARDS: Exactly.
CHR. CHUNG: But as you said, I think all of us. I don't know anyone of the
persons on this Council who does not support Mass Transit at this particular point
in time, especially with Brenda at the helm. It's just a matter of whether we're
going to frontload it or backend it. What is the more responsible thing to do? I
don't know. Deanna, when are we going to get a better picture on our GET?
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Hawaii County Council-43 June 4,2020
MS. SAKO: They've only posted the results through February so it's going to be
another month at least.
CHR. CHUNG: But you already reduced the GET.
MS. SAKO: We reduced it by 25 percent, yes.
CHR. CHUNG: Right. Is there a possibility that we might get hit more than that?
MS. SAKO: No one knows. Yes, it's possible.
CHR. CHUNG: What's your intuition, your best thought?
MS. SAKO: It's going to depend on when tourism comes back. You know, the
estimates were 40 percent of the GET comes from tourism spending. You know,
so this—and this budget doesn't start till July 1st, so we have another month. But
let's say tourism started in July. We, you know, looked at reductions throughout
the year. We didn't assume we'd be back to normal by the end of the year.
CHR. CHUNG: Let's look at the two scenarios. Let's say we approve this,
and—well actually, there's a lot of permutations here. But let's work within the
context of this amendment. The easy thing is if we get the revenues that we
anticipate even with the reduction, then we can just replenish.
MS. SAKO: (Inaudible)put it in, yeah.
CHR. CHUNG: No problem, right?
MS. SAKO: Right.
CHR. CHUNG: If we don't, we have to have made these cuts anyway or not?
MS. SAKO: If we believe it's going to be substantially less than what's
budgeted, let's say none of the amendments to GET Fund passes, we would come
back in mid-year. That's why at first reading I had said we weren't going to make
the transfer to capital project fund.
CHR. CHUNG: No, no, no. I'm saying if this were approved.
MS. SAKO: Yes, if it was approved
CHR. CHUNG: Because if it's not approved then you would have to come back
later on, right? But if it were approved
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Hawaii County Council-43 June 4,2020
MS. SAKO: If it was approved, right, we would have to come back to put it back
in.
CHR. CHUNG: Okay.
MS. SAKO: Right.
CHR. CHUNG: Alright, and if it's not, then we just—
MS.
ustMS. SAKO: We never come back and the buses don't get purchased or the tow
truck.
CHR. CHUNG: Okay. Would there be another way that this could be retained
and take funds away from another program?
MS. SAKO: I believe that's the next amendment.
CHR. CHUNG: Okay. So do you want to—why don't we table this.
MR. RICHARDS: Sure. I'm very happy to table.
CHR. CHUNG: Why don't we table this.
Vote on Motion Mr. Richards moved to table Comm. 774.21. Seconded by
to Table: Ms. Lee Loy and carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. Let's go on to the next one.
Comm. 774.19: From Council Member Herbert M. "Tim"Richards, III, dated June 3, 2020,
transmitting a proposed amendment to decrease the Transfer to Capital Project
Fund-General Excise Tax expense account by $9,368,912.
Motion to Amend: Mr. Richards moved to amend Bill 144, Draft 2, with the
contents of Comm. 774.19. Seconded by Ms. Lee Loy.
CHR. CHUNG: Mr. Richards, go ahead.
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Hawaii County Council-43 June 4,2020
MR. RICHARDS: Pretty much ditto of the whole conversation we've had up to
this point, and again, this is a cash flow management. What we're looking at for
the short term for the economy as a whole and our constituency, our people, our
businesses, is we have to support Mass Transit. I get it. We have to be able to
fund it, and I get it. That's why specifically I did not do anything with Mass
Transit as far as those contract levels. I think that's a little over $10 million if I
recall, and then the actual management of Mass Transit was about I think
$3.5 million off the top of my head, for those exact reasons.
To allay the concerns of Matt and Ashley for those reasons. If we do have the bus
contracts and we do have buses that are running anywhere from, like I said 10, 12,
13 a day. The whole idea is to manage this cash flow, and I'm concerned about
that going forward. The $37 million coming in on GE implies we have a
$7.5 billion economy, and during our best we projected about$8.5 billion. If we
lost$3, that's why I don't think the numbers match.
That being said, fortuitously we have those 10 bus purchases that came forth, and
delivery date I'm going to guess is probably 2022, maybe 2021 with all this thing,
we don't really know. Again, this isn't—well it is a defunding, but it's hitting the
pause button on our capital investment right now. I looked through everybody. I
tried to find where we could do the pause button for the short term. The Mass
Transit general plan, the 10-year plan, is roughly speaking $200 million.
$20 million over 20 years. We supported that, we approved it, and I frankly think
it's a pretty good plan. Then COVID has hit it.
So what this does is it hits the pause button for six months. If we have the
funding—and I gave Deanna my word I would put the funding back in Mass
Transit if we have the funding coming forward. I appreciate, Ashley, what you
said about GE coming forward, and giving us a funding method to do this. I
completely agree with you. I'm willing to use it for that. But if we don't have it,
we don't have it, and that's my concern.
If we don't get the economy back up with our tourism, which I'm hoping we're
going to be maybe up to 30 percent or 40 percent by the end of the summer, that
still hugely impacts our overall GE collections which directly impacts this
funding. Like I said, in four months we may be saying hey, things are looking
really good, or not. So I'm trying to be planning—again, recommendations,
they're talking 20 percent cuts across the nations. In all the NACo things I've
been involved with, that's what general concerns are, somewhere between 15 and
20 percent. This one only takes us down to about 11 percent, but it's better to cut
now and re-appropriate than to have to make some draconian cuts later. Chair, I
yield. Thank you.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Let me ask you a question before I call on the others, though.
And I'm going to ask the same thing that I asked Deanna earlier. Is this
amendment and the other one mutually exclusive with one another or compatible?
MR. RICHARDS: They're not mutually exclusive. They can be taken one or the
other or both.
CHR. CHUNG: And Deanna, what are programs are going to be affected
specifically by this one?
MS. SAKO: So it's the projects that are in the Mass Transit Master Plan for the
current year, you know, including a lot of the bus shelters and different
equipment. So there's a variety of things. One of the purposes of the transfer to
capital projects fund is also to help design and get some of the projects ready to be
shovel ready should we get a stimulus package.
MR. RICHARDS: And Chair, one of the things that I'm hoping, and I mentioned
this previous, that with a stimulus package coming in, I think this economic
recovery for our nation is going to be reminiscent of coming out of the Great
Depression. We're going to have to have public works projects coming forward,
and I'm hoping we're going to be able to tap into that. But that is something that
we collectively have to work on with our legislators in Washington, D.C. and help
push for that, because we're going to need that kind of support to get a lot of this
done.
CHR. CHUNG: Let's assume for argument's sake that Mr. Richards' projections
are accurate and we've got to cut somewhere along these lines. Can we cut
somewhere else? Where else—what other possibilities are there to take away
from instead of this?
MS. SAKO: I don't know that there's a lot of other possibilities, but if you're
talking specifically about the transfer to capital projects fund, we know we have
to get projects shovel ready, because otherwise we're not going to be eligible for
any of the stimulus money. So we would probably utilize some of the bond
funding from the ordinance you guys recently passed for those transportation
projects. So we would try to get those projects shovel ready and, you know,
moving along with a few others, because it has to be transportation related.
CHR. CHUNG: But not all of the GET is being devoted to Mass Transit, right?
MS. SAKO: No, so some of it is devoted to debt service for roads projects that
have already happened, as well as those for the bond authorization you guys
passed recently.
CHR. CHUNG: And that's it?
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Hawaii County Council-43 June 4,2020
MS. SAKO: Yeah, that's it, because we moved everything for transit from
Highway Fund over to GET to help balance the Highway Fund this year.
CHR. CHUNG: Holy smokes. These are real important, though, these projects?
They've got to be shovel ready, though right?
MS. SAKO: For stimulus, that's how it's been in the past. I do not know the one
right after the Great Depression, but during my lifetime they've all had to be
shovel ready, yes. I didn't want anyone to think I was that old.
CHR. CHUNG: If you had to advocate something with regard to those two
amendments, what would be your recommendation from the Administration?
MS. SAKO: A little bit of each, because Brenda did get the COVID grant that
can help to supplement for lost revenues, so she might be able to utilize some of
that for additional buses, but I haven't been able to look carefully at her rules that
she has to follow yet. But we do know we need to get projects shovel ready. So I
would do a little bit from each.
CHR. CHUNG: What?
MS. SAKO: Well I know she needs the tow truck as well. So if we wanted to say
that tourism accounts for 40 percent of the General Excise Tax Fund, and you
wanted to bring it down 40 percent from last year, you would need another
$7.5 million. So you could do something like $6 and $1.5 or something like that.
Like $1.5 from equipment and $6 from Transfer to Capital Projects Fund.
CHR. CHUNG: The capital projects, $1 and $6, instead of$4 and $9 million.
Okay, Ms. Lee Loy.
MS. LEE LOY: Thank you, Chair. And this is the dance, right? So Deanna, this
particular capital improvement fund, although we have some ideas, it hasn't been
specifically earmarked like the one prior, right? The $5 million seems to have
some real assets
MS. SAKO: Oh, that has very specific—we actually do have the list for the other
one. It's specifically the part of the Mass Transit Master Plan. Steve has it. But
we were thinking of using part of that to get some of the projects shovel ready
because I'm not sure that Public Works has enough projects shovel ready should
we get—last time it was ARRA (American Recovery and Reinvestment) funds.
Whatever the stimulus package is, we just want to make sure we have enough
projects ready so that we can apply for that funding. Because we were very
successful last time. We actually got way more than the other counties because
we did have projects shovel ready.
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Hawaii County Council-43 June 4,2020
MS. LEE LOY: So I'm going to ask again like Chair Chung, the option is $5.4,
which clearly has like the tow truck, has some assets attached to it, and then
there's this $9, which has some
MS. SAKO: Is not as yeah. It's not as firm.
MS. LEE LOY: Right. Okay.
MS. SAKO: But even if you took the entire $7.5 from the $9, that would at least
leave a little more over a million so that they could work on some design projects
to get some other roads shovel ready.
MS. LEE LOY: That number again, Deanna? I'm sorry.
MS. SAKO: If we went with $7.5 is what we want to reduce. I don't know that
we can agree, but when we originally did the GET fund, the projection was that
40 percent came from tourism. So let's say we had zero coming from tourism in
the coming year. That would be a 40 percent reduction. So we already accounted
for a 25 percent reduction, so that additional amount would be $7.5 million to
reduce the budget by. And so if you just change the Memorandum Number 6 to
$7.5 million, that would leave $1.8 million in Transfer to Capital Projects just to
help get them started on doing a few more shovel-ready projects.
MS. LEE LOY: Okay. And then for clarity purposes, because you mentioned it
earlier, recognizing that we were going to see some of this budget shortfalls, you
went through the budget and found areas that had a nexus to the use of the GE
fund because it was transportation related. So like for example, number the police
officers who are TEU unit(Traffic Enforcement Unit), direct relationship to
transportation and safety on our roads, their salary and wages was moved over.
MS. SAKO: Yes, they were actually moved to the Highway Fund and then to
free up money in the Highway Fund, we moved the rest of Mass Transit over to
GE fund.
MS. LEE LOY: So we found some nexus between the use of GE funds and was
able to reduce areas within the General Fund and the Highway Fund and move
these over.
MS. SAKO: Yes.
MS. LEE LOY: Are we certain we did our very best in the General Fund finding
that nexus between transportation and the GE funds?
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Hawaii County Council-43 June 4,2020
MS. SAKO: Yes, we've gone through it the last couple years with like a
fine-toothed comb and had multiple discussions with Corporation Counsel to
make sure that, you know, we're still legal in everything that we did. We've
asked them a lot of tough questions.
MS. LEE LOY: So within this GE fund and the Highway Fund that we moved
over, fuel for the buses, right? Those things are actually being covered by this GE
fund.
MS. SAKO: Right, because it's fuel for the buses, which is part of transportation
system.
MS. LEE LOY: Transportation.
MS. SAKO: Yes.
MS. LEE LOY: So what about the fuel for individuals providing public safety on
our road like our police TEU unit? What about the fuel for their cars?
MS. SAKO: For police TEU units, yes, that went over. And their vehicle
allowances.
MS. LEE LOY: Okay. Thank you, Chair. I yield.
CHR. CHUNG: Matt.
MR. KANEALI`I-KLEINFELDER: Just for the general—anyone watching.
What are the allowable uses of GE funds?
MS. SAKO: So General Excise Tax Funds have to be used for transportation
purposes, and—so it has to be part of a transportation system.
MR. KANEALI`I-KLEINFELDER: It was pretty tight. I mean they gave us
some clear parameters on how to expend these funds going forward so it wasn't
an open source of funding.
MS. SAKO: So operating or capital costs of public transportation within the
County for public systems, including public roadways or highways, public buses,
trains, ferries, pedestrian paths, or sidewalks or bicycle paths, and related ADA
projects (Americans with Disabilities Act).
MR. KANEALI`I-KLEINFELDER: So if we pull funding—so I understand the
cash flow, and I can understand where Tim's going, he's looking for cash flow
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Hawaii County Council-43 June 4,2020
issues coming up. You've already cut your budget—you've already cut your
expected revenue from the GE account by 25 percent, and Tim is worried that
we're going to see more of a drop, which I think
MS. SAKO: It's a valid concern. None of us know for sure.
MR. KANEALI`I-KLEINFELDER: It's a valid concern and nobody knows.
And gaging from what I've seen in the economy it's mixed. I see people buying
brand new fridges and redoing their houses, and I see lining up for good boxes for
miles. So nobody can give us an answer for that.
So if we cut spending from the GE portion of our budget, are we really digging
into the actual expenditures for our County, or are we playing with more of an
imaginary account that we think we're going to get a certain amount of funds
you know, we think we're going to get and we're going to use this accordingly
over the next year, versus our normal operating costs that we just, we can never
get away from. Salary and wages, you know, all the different subscriptions we
have, you know, cell phones, gas, I mean everything. Just go down the list, it's
huge.
MS. SAKO: No, I wouldn't call it an imaginary number, but we have done our
best to estimate what we believe is revenue in this particular fund of general
excise tax, and all of the funds. But this particular one is impacting only transit,
and it wouldn't impact like the tax rates and other things that Mr. Chung asked
about before, because it's specific to General Excise Tax Fund. So it would just
basically just delay the purchase or eliminate the purchase if the revenue wasn't
there.
MR. KANEALI`I-KLEINFELDER: Okay. What percentage of our budget is
Mass Transit?
MS. SAKO: The entire budget? I don't have that off the top of my head.
MR. KANEALI`I-KLEINFELDER: Or their expenditures. When we talk about
Mass Transit, how big of a portion of our budget? Because I know salary and
wages, we come back to always 60 percent of our—or 60-plus percent, almost
70 percent of our budget is salary and wages out of our real property tax.
MS. SAKO: Right. So their wages are paid by General Excise Tax Fund, but if
we divided by the entire budget, they're about three percent of the entire budget.
MR. KANEALI`I-KLEINFELDER: Okay, so three percent of our budget—okay,
what we saw coming out of the Great Depression from what I gather, because
interestingly enough my kids had homework. And the homework was discussing
the Great Depression and then the two presidents at the time who worked their
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Hawaii County Council-43 June 4,2020
way out of it. It was really interesting and very clever on the teacher's behalf
you know, thank you teachers, for doing your jobbecause I learned something.
Then, you know, some of the projects that they did they basically stood on each
other. I think they had, it was Hoover and Roosevelt. I mean the two of them. I
mean Hoover had some good ideas, but eventually he got slammed by Roosevelt,
Roosevelt picked up where he left off, and then did some amazing things but also
some questionable things according to some people in his cabinet.
But what he did do was he started to fund projects and he slowly pulled America
back up out of the Great Depression and got them going again, which I like to
read because you see people talking about the civilian corps
MR. RICHARDS: CCC (Civilian Conservation Corps).
MR. KANEALI`I-KLEINFELDER: Yeah, the CCC, and that's starting to come
back, and it's a great idea because you're putting people to work and you're
getting things done, and you're seeing progress and you're making people feel
proud about where they're from.
So I'm having a hard time looking at what we're doing right now, what's in front
of us, because we're actually taking away from these projects that we need to get
moving again. In the same way that we saw coming out of the Great Depression,
you've got to get projects and people working and rebuild jobs at a local level.
Because that's—it's a proven way. We're not reinventing anything; it's proven
that we can get ourselves back out of this hole if we do that. And we start killing
capital works projects, we're also talking about decreasing jobs in my head. I
may be off, you know, I'm still learning, but if we decrease job production and
job creation because we're estimating that we're going to see a reduction in our
GE revenue and we're not getting these projects shovel ready, then come six
months, funding or not we're not providing more opportunity on our island.
That's what's worrying me right now. And going back to the Mass Transit, we
decrease Mass Transit, then they can't even get to their jobs even if we did create
them. Okay. I mean, am I on track with that?
MS. SAKO: No, I totally understand what you're saying. It's a timing issue of
when we would start doing some of the work. Because without the appropriation,
you know, then we couldn't start on some of it. So I was trying to reach some
kind of compromise where we could leave some of it to start on the projects.
MR. KANEALI`I-KLEINFELDER: Okay. Those are my thoughts. I think we
just have to be careful. I mean, Tim, you're really touching on something that's
important. We have to be really fiscally responsible going forward, and that's
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Hawaii County Council-43 June 4,2020
always been your thing and I totally agree with you. But we also have to balance
that with making sure that we're creating job coming out of this or there's nothing
for anybody on this island to do.
MR. RICHARDS: Chair, can I comment?
MR. KANEALI`I-KLEINFELDER: Well one more comment, sorry. I mean, in
one of the budgets that was submitted to us, in the draft in the recommendations it
said we need to keep County workers employed because that's how we're going
to really support our economy. While I appreciate that comment, we're not the
only employer. You know, a lot of employers out there, and we also need to
focus on
MS. SAKO: It wasn't meant to imply that.
MR. KANEALI`I-KLEINFELDER: No, no. It wasn't, but I just, I saw it and
looked at it at. Face value was like wow, that's a good comment and I agree with
that, because the County right now is probably supporting a good portion of this
island economy-wise, and so is all the unemployment funds coming in. But we as
the Council need to be very aware that job creation outside of the County is really
important. Not that we're not aware of that, but that's where we need to be
headed in my mind. Thank you for the latitude, and I yield.
CHR. CHUNG: Mr. Richards.
MR. RICHARDS: Yeah, thanks. And Matt, I agree with you. We need the Mass
Transit and that's why this doesn't cut any service of the Mass Transit
whatsoever. It delays the capital investment and that's a very important
distinction. Now I do—and that's why the $1 million when Deanna and I were
talking about under the $5.4 resolution—excuse me not that one. The first one,
cutting the $5.4 and change to $4.4, the reason being is that left$1 million in
there for the federal grant matching coming forward. Not the ones that we
currently have but going forward with that. So very mindful of that.
Also, from the listening to the conversations and being shovel ready, I'm a big
proponent of that. We learned that from the State DOT (Department of
Transportation). So I'm very willing to take this and you give me a number,
Deanna, and I can change this amendment to make that so we have funding to
plan that. Because as we all know, we plan something today, it'll be 18 months
before we actually move the dirt there. So let's get the shovel ready going and if
you give me a number, we can table this one as well, and come back with an
updated one.
And I'm very happy to do that because I'm with you, Matt. I have gone back and
have looked at the CCC, I've looked at what Roosevelt did, Grand Coulee Dam,
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Hawaii County Council-43 June 4,2020
Hoover Dam, all that was under the CCC, and right or wrong, it did put America
back to work. And we on a lower level are trying to do the same thing. Our
problem is we don't have the funding like the feds do and we're going to have to
rely on the feds. So my hope is to hit the pause button, get ready, and as soon as
that funding comes forth, and it's going to have to, then we jump at it and we go
full speed ahead.
So give me a number, Deanna, and we'll make the paperwork. Very happy to do
that because unfortunately, like Chair has stated, this is how we have to do it. We
don't get to sit down and figure out this thing. We have to do this in this public
forum. So give me a number and I'll get the paperwork rolling.
MS. SAKO: I think we'd probably be comfortable with like reducing it by
$7.5 million. That way it would at least leave some in there for capital projects
and to get them going, then we can continue to monitor as we will all funds going
forward, because we're the first to learn that this is a unique situation we're in,
and unique coming up this next year, and all the revenues are going to have to be
closely monitored.
MR. RICHARDS: So am I hearing changing the $9.3 to $7.5?
MS. SAKO: Correct.
MR. RICHARDS: Correct, okay. Chair, I move to table this while I can do some
paperwork.
CHR. CHUNG: Okay, and in the meantime, I think while we're—Brenda is
coming here, right, Steve?
Vote on Motion Mr. Richards moved to table Comm. 717.19. Seconded by
to Table: Ms. Lee Loy and carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. So Ms. Lee Loy, we're going to
MR. KANEALI'I-KLEINFELDER: Chair, can I ask for a recess real fast? Is that
okay with everybody?
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Sure. Five minutes?
MR. KANEALI`I-KLEINFELDER: Yeah, five minutes.
Recess: At 10:58 a.m., the Chair called for a recess.
Reconvene: The meeting was reconvened at 11:13 a.m.
CHR. CHUNG: Okay, we're out of recess. And we also have Brenda Carreira
from Mass Transit. You know, we shouldn't have tabled that thing,just take the
recess. But that's okay. Let's take—which one should we take off the table? The
first one? Okay, let's take that one off the table, then.
Vote on Motion Ms. Lee Loy moved to remove Comm. 774.21 from the
to Remove table. Seconded by Mr. Richards and carried by the
from Table: following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. We're back to this 774.21. Okay, who wants to
ask Brenda a question? She came all the way from her—okay, go ahead.
(Note: At this time, Mass Transit Administrator Brenda Carreira came
forward to address the members of the Council.)
MS. POINDEXTER: Earlier when we were talking about cutting that—or putting
it aside, I'm saying cutting it. I wanted to know how would it affect operations,
or what kind of effects on it. You know, it may be six months or longer that this
may be set on the side. I just wanted to know from you, Brenda, on what kinds of
effects on our master plan, or just the transportation throughout our island.
Would that harm it, or just give us your brief overview of what this does to your
program.
MS. CARREIRA: Okay. Brenda Carreira, Mass Transit Administrator. Thank
you for allowing me to come before you. So what I understand is—and because
of the feds, their making us cutting expenses for either the equipment or the
capital. I just wanted to specify for the capital, what that includes is like the
environmental assessment
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: We're not talking about the capital right now.
MS. CARREIRA: Oh sorry, which one?
CHR. CHUNG: We're talking about the Mass Transit.
MS. CARREIRA: I don't have
CHR. CHUNG: I mean, I don't mind you talking about everything, quite frankly.
I'm just letting you know that we're talking about the mass
MS. POINDEXTER: The buses.
MS. CARREIRA: The buses.
CHR. CHUNG: But if you want to, you can. Make sure that—
MS.
hatMS. CARREIRA: No, that's fine. For the buses, I do know for that award that
we received last year October for the 10 buses, our share is $900,000. That, we
have to come up with that in order for us to order the 10. If for any kind of reason
that would be taken away, I couldn't order 10, and I know there was a question as
to whether we could change it into zero emissions. That was based on 10 buses at
about$600,000, that's the diesel. Electric is about$770,000 to $1 million to bus.
That's a big difference.
Equipment for us, I just put in another application for more bus equipment if I
need to get a fleet of 55. Right now working—even with the new buses, I still
have only 10 buses operating. So a lot of our equipment we've been buying parts,
waiting for parts. So the more I can get more buses here, and maybeI'm hoping
between six months and, if I can, but a lot of factories closed down during
pandemic so they have this backlog so they can't even tell me when they can get
buses.
So any time I'm not allowed to get more buses to help us, it's increased cost for
us for rentals, more strain on the current buses that have been giving their life's
blood. Fortunately though, with Roberts, they have buses that we've been able to
add on, but our expensed for this contract is so high. So also for me to be fiscally
responsible, is trying to reduce that. But right now we're fine. We have been
through the pandemic running, doing the social distancing. So and it's not just
buses, but equipment and that's parts. And we're always buying parts and parts
are very expensive. So it does affect operations.
MS. POINDEXTER: Okay, so it does affect operations. I'll let the other Council
members
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Hawaii County Council-43 June 4,2020
MS. CARREIRA: I'll keep asking for grants, because that's great. You know,
we keep going. I could maybe ask for an extension, but right now every time I do
an application, I'm telling them it's because we need buses.
CHR. CHUNG: Okay. Well Brenda, right now, the proposal is that the GET
Mass Transit equipment be reduced by about$4 million, leaving that account with
$1 million. Okay, now you talked about you need $900,000 to be able to pay for
our share of the buses that are on order, right?
MS. CARREIRA: We can't order until
CHR. CHUNG: Okay, and then you probably need some other things. Could you
operate right now with $1 million with the thought that when we have a better
picture of our GET revenue stream those things will be replenished later on. Is
that okay, or is it going to be very difficult?
MS. CARREIRA: Probably very difficult.
CHR. CHUNG: Okay, what is a figure that you could live with, or you need the
total amount right now. Because at the same time, you've got to remember now if
we allow for the total amount, if we realize a shortfall at the backend, you're
going to have to deal with that, too.
MS. CARREIRA: Yes, sir.
CHR. CHUNG: So what—?
MS. CARREIRA: I'd rather deal with it—
CHR.
tCHR. CHUNG: At the backend?
MS. CARREIRA: Yes, sir.
CHR. CHUNG: Okay.
MR. KANEALI`I-KLEINFELDER: Brenda, thank you for coming. Nice to see
you. I haven't seen you in a long time. I think, refresh my memory, when you
came in to the department as the head, what I remember you saying you were
dealing with is that there have never been there never was really a plan to
upkeep the buses. It was just we bought buses, then we didn't budget for
anymore buses past that, and that made an equipment shortfall. So what I'm
worried about with what's in front of us that if we pass this, even though we're
expecting less revenue from GE this year, and we have to be mindful of that, is
that we're going to put ourselves right back into the same situation where we're
not going to do anything, we're not going to get these, we're not going to put out
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Hawaii County Council-43 June 4,2020
the RFP's (Request for Proposals) and buy buses and get equipment and set it up
for down the line. So come a year or two from now, we're right back in the same
hole that we're in right now. That's my concern.
So I'm glad you're here so you can help us understand that maybe it's not good
we cut back on your equipment, no matter what the budget's looking like.
Because to me, Mass Transit is a crucial part of our rebuild for our economy
because it's going to service everyone that doesn't have a vehicle, and that needs
to get to a job, and that's exactly what Mass Transit's designed to do.
And Mass Transit, from what I remember, does not run at an operating profit.
We're always a shortfall no matter what we've done. And that goes for actually
the whole nation. You don't run at a profit, because your revenue from your fares
does not equal out to what we put out on the backend.
MS. CARREIRA: Yes, sir.
MR. KANEALI`I-KLEINFELDER: I'm in favor of keeping the funding for you
and not for removing the funding from one of these communications that were put
forward.
MS. CARREIRA: So I just wanted to say, what I've also come to realize and
learn is that it's way more efficient to not order, you know, although I put in 10,
because when I put in the application I figured they'd only give me five but then
they gave me all 10. I'm kind of staggering it so, you know, you don't get 20 at
one time and then all at the same time I've got to order 20 when they—so it's
kind of like six months here, then a year, a year and a half, and if, you know, it
keeps on coming.
MR. KANEALI`I-KLEINFELDER: That's great. So you're replenishing stock,
and your buses aren't all going to some in and then break at the same time.
MS. CARREIRA: Yes.
MR. KANEALI`I-KLEINFELDER: Yeah, they'll break. Because things break at
a staggered rate instead of at one speed. Then I did forget that I had put in a
resolution earlier when I first came into office asking to push towards alternative
fuel vehicles. So I brought it to Deanna yesterday and I'm glad you're aware of
that and going forward thinking ahead. Although it's a little bit off topic, but yes,
please.
MS. CARREIRA: Also, you know, we pretty soon there's that one hydrogen
that has been fully upgraded that's in Honolulu now that's coming. And then the
other two. So this equipment doesn't include those buses because one is free, the
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Hawaii County Council-43 June 4,2020
other two we already paid for. So we do have three hydrogens coming which I
hope would be by the end of the year if not earlier. So that was not included in
our budget because it's already like paid for, if you will.
MR. KANEALI`I-KLEINFELDER: Yeah. So off topic, but yes. So currently
again you have 12, what, 10 to 12 buses running right now?
MS. CARREIRA: About 10. And you know, incrementally getting more. But
yeah, I know it's not a lot.
MR. KANEALI`I-KLEINFELDER: I was guessing about 12 to 15. That was my
guess because the last time we talked I think it was 13 buses.
MS. CARREIRA: We're hoping.
MR. KANEALI`I-KLEINFELDER: So 10 buses. Wow. Okay, thank you,
Brenda. I appreciate your time.
CHR. CHUNG: Then Deanna, come by her.
(Note: At this time, Finance Director Deanna Sako returned to the table to
address the members of the Council.)
CHR. CHUNG: Brenda said that she would prefer to handle the shortfall on the
backend instead of frontloading this thing. How would the Administration
manage this type of situation? I just want to know.
MS. SAKO: She would have to look at her operations and ensure that she had
enough to carry her through to the end of the year, so she would have to make
cuts in the other areas. Or if the buses came in at a lower amount then budgeted.
But if they came in higher, you know, we'd have to look at that. We probably
wouldn't be able to fund it.
CHR. CHUNG: Will you be monitoring their operations as well?
MS. SAKO: Yeah. We're going to be monitoring everyone's operations in the
coming year.
CHR. CHUNG: Yeah, because if we frontload this, your department, Brenda, is
going to have to anticipate and operate under the assumption that we're going to
have a shortfall. And if we don't, hey, fantastic, right? But cannot just
"woo-hoo,"we have this amount and then we're going to go ahead, right? It has
to be done with a lot of fiscal prudence if we allow the budget to go ahead as
proposed.
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Hawaii County Council-43 June 4,2020
Now I'm going to ask you, because I don't want to belabor this point. First of all,
I want to dispel any notion that anyone here is against the Mass Transit
Department or the program. It's just how are we going to handle this? We have
an anticipated shortfall, are we going to frontload it or backload it. That's all. It's
very simple. And it's going to come down to what kind of capacity we have for
risk in this, and what kind of management that we have our faith in.
MS. VILLEGAS: Chair Chung?
CHR. CHUNG: Yes?
MS. VILLEGAS: My apologies.
CHR. CHUNG: What?
MS. VILLEGAS: Sorry to interrupt. I just wanted to raise my hand to ask
questions.
CHR. CHUNG: Okay, let me just ask one more question. Having said all of that,
what is the recommendation of the Administration.
MS. SAKO: It's the same thing we said earlier. We're going to be monitoring
and we're going to hold back on the Transfer to Capital Projects Fund. So that's
the area that we would rather control going forward. Because that would still give
us
CHR. CHUNG: My question, do you want to do what's proposed by
Mr. Richards or not? Yes, or no.
MS. SAKO: We'd rather not. But if we're going to touch anything, we'd rather
it be the Transfer to Capital Project Fund.
CHR. CHUNG: Okay. Rebecca.
MS. VILLEGAS: Yes, quick question. If it's already been covered, my
apologies. But I'm looking for confirmation. Does passing what's being
recommended here by Mr. Richards, does this then solve the problem and
eliminate the need for us to increase the tier-two taxing?
CHR. CHUNG: It was asked already. No, no, no. It has no affect on the rates.
This is an independent source of revenue. It has nothing to do with real property
taxes.
MS. VILLEGAS: Deanna?
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Hawaii County Council-43 June 4,2020
MS. SAKO: This particular fund is funded entirely by General Excise Tax
Revenues. So we're projecting what we believe is going to come in, in General
Excise Tax revenues given our current economy, and we projected a 25 percent
decrease.
CHR. CHUNG: No. Deanna.
MS. SAKO: But yes, but right. But so but—
CHR.
utCHR. CHUNG: Let's keep things short and to the point.
MS. SAKO: However, this doesn't affect General Fund and the real property tax
rates.
MS. VILLEGAS: So, well I'm confused because in our last meetings, I know
that Mr. Richards was very concerned about a tier-two tax and the need to
increase the tax amounts and as well looking at the budget and for ways to make
cuts and balance things that's eliminating the need to increase taxes on any form
of properties or any of the divisions. If this doesn't affect that at all, I guess I'm
confused why we're continuing to go—if this isn't absolutely necessary and it
doesn't solve that crisisI'm not sure who could answer my question best on
that. But I'm completelyI think this was going in that direction to solve that
issue.
CHR. CHUNG: Well, we made that point very clear earlier. In fact, that was one
of the first questions I asked of the department, for confirmation that this has
nothing to do with the tax rates. But you know, everyone is free to do whatever
they want. It doesn't have to mean that everything that's proposed by a Council
member will have an affect on tax rates. This one just doesn't have anything to
do with the tax rates.
MS. VILLEGAS: Okay, thank you, Chair Chung. And I just want to clarify that
none of us here in chambers in Kona got that understanding from what was stated
in the beginning. So my apologies for missing it. I'm glad that we're going over
it now, because that clarification is really necessary. So thank you.
CHR. CHUNG: Alright, thank you. Mr. Richards.
MR. RICHARDS: Thanks, Chair. Brenda, thanks for being here. Thanks, Chair,
also for making the point that this is not against Mass Transit. This is actually to
support Mass Transit. I believe I was the one that asked you about the Mass
Transit planning document. This is a good plan. And I think you were initially,
because you were having two days on the job, and I haven't read the whole thing
yet, then you came back and said, "Yeah, I think it's a good plan." I do support it.
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Hawaii County Council-43 June 4,2020
Question for you. If you ordered a bus, or maybe you already have ordered a bus,
when's the delivery date?
MS. CARREIRA: For the
MR. RICHARDS: Just the diesel buses right now.
MS. CARREIRA: Oh, diesel buses, they're saying at least a year.
MR. RICHARDS: Okay, so when are we going to have to pay for those?
MS. CARREIRA: When it's delivered.
MR. RICHARDS: Okay. So what we're talking about is appropriating funds for
a delivery date that's probably a year away.
MS. CARREIRA: Yes, sir. On some of them.
MR. RICHARDS: Okay, so that's the first thing. Then going forward, how many
buses have you planned to order in the year 2021 from July to June next year?
MS. SAKO: Can I just clarify something while they're working on that?
MR. RICHARDS: Sure.
MS. SAKO: I know the cash we don't need until the buses come in, but I have to
be able to certify funds when we order the buses and that we need an
appropriation for.
MR. RICHARDS: That million dollars, right.
MS. SAKO: For the scheduled ones, yes.
MR. RICHARDS: Yeah, which is why we have that left in.
MS. CARREIRA: Twenty.
MR. RICHARDS: Twenty. So we have 10—we have the funding for 10, so
you're looking for funding for another 10, correct?
MS. CARREIRA: Yes, and we because of the federal grants that we
MR. RICHARDS: Yeah, because the federal grants already have funded 10, so
we need funding for the other 10. If we don't have the money, what are you
going to do?
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Hawaii County Council-43 June 4,2020
MS. CARREIRA: Well, we would just—
MR.
ustMR. RICHARDS: Just wait.
MS. CARREIRA: Wait.
MR. RICHARDS: Until you get the money.
MS. CARREIRA: Yes.
MR. RICHARDS: Okay, and this is my point. This is totally a cash flow
management. It's nothing about canceling your project. This is all about being
able to fund your project when we have the cash to fund it. So this is strictly a
cash management project going forward. We have 10 buses and those 10 buses,
have they been ordered or not yet?
MS. CARREIRA: No, some of them have to wait until July because they're in
the new budget. The other ones about half of them would be by the end of this
month.
MR. RICHARDS: Okay, but you won't get those until the end of—till maybe
June 2021.
MS. CARREIRA: Yes. Some possibly earlier, but I'm just not sure.
MR. RICHARDS: Yeah,just—cannot. So again,this is a point—and Brenda,
you and I have had this conversation. I support you. What I'm trying to do is
figure out how to financially support you as we go into this. So—and I was the
one that voted for adopting the Mass Transit plan which takes our total
expenditures for Mass Transit from $10 million a year roughly to $20 million a
year.
And Matt to your point, the income stream from Mass Transit has never been
really over $1 million a year, and you're also very right that the expenditures for
Mass Transit are always heavily subsidized. But they have to be, because it's for
the greater good. I'm good with all of that. So the point is this is strictly cash
management going forward. So, and I hear what you're saying, Brenda.
I do have a question on the tow truck, though. I do not agree with you on the two
truck. How many tows are you doing a year right now? Or a month, or—give me
a timeline.
MS. CARREIRA: Actually it's been a lot less now. Probably in the last six
months, maybe two.
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Hawaii County Council-43 June 4,2020
MR. RICHARDS: Okay, so a$400,000 bus, if we finance it at five percent
money, because that's a round number we can deal, and put it on a five-year
note—is that what we normally do, Deanna?
MS. SAKO: Our leases are usually five years, and the interest rate's a little lower
than that.
MR. RICHARDS: Okay, but let's take five percent because I can think that way.
A $400,000 investment with five percent money over five years is roughly
speaking $100,000 worth of interest. So it'd make that a $500,000 purchase,
which is $100,000 we'd need to amortize each year, and I know it costs about
$1,000 to haul a bus from Kona to Hilo. So that means we'd have to do 100 hauls
a year to break even on this. If we're doing 50 hauls a year, it'd make more sense
to contract it.
I bring that up again. This is a cash management and cash flow issue. Sometimes
it makes more sense. So I don't disagree with you, Brenda, as far as trying to
fund you and be sure we get you new buses, because Chair Chung made the point
that we're not going to take second-hand buses anymore. We're going to buy
new buses and I agree with that.
But I'm concerned that we don't have the funds secured yet, and I don't want to
over promise and under deliver. I want to under promise and over deliver. So
with that, again, I'm not changing the position. I am changing the paperwork,
Deanna, the $4.5 is there and leaving that million dollars for the matching so
Brenda can still function forward. And the paperwork has changed. We have
Communication 774.23 to replace. So Chair, I think I've beat—I've discussed
this enough.
CHR. CHUNG: Yeah, we have discussed this at length. I want to just move
ahead on this thing already, okay?
MR. RICHARDS: Sounds good.
CHR. CHUNG: So why don't you—if you want to make the amendment? If not,
we'll just call for the question on this item. It's here. But I don't think we should
discuss this much longer.
MR. RICHARDS: No, I'll
MS. EOFF: Mr. Chung? I'm really sorry.
CHR. CHUNG: You're going to be real quick, right?
MS. EOFF: I want to ask Tim something, if that's okay.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Yeah, go ahead.
MS. EOFF: When you first made your presentation about what your plan was
between the first communication and then the second communication before we
even had this amendment, you threw out some numbers which I think is what
threw us off, because you said that if we approved of the two proposals, we would
reduce the overall budget total from $585 to something like $571, correct?
MR. RICHARDS: Correct.
MS. EOFF: So in my mind, I thought that would influence what we might have
to set the tax rate at down that line. I know it's not a direct fix for anything, it's
just that it reduced the overall budget in the operational budget.
MR. RICHARDS: It does. It reduces it by $14 million.
MS. EOFF: So once we reduce the overall budget, and I guess this would be for
Deanna, would that potentially change where we might have to go with the rates?
I know it won't—
MS.
on'tMS. SAKO: Any amendments to the General Excise Tax Fund will not impact
the real property tax rates.
MS. EOFF: Okay, I
CHR. CHUNG: Karen, is that it?
MS. EOFF: Tim?
MR. RICHARDS: I'm here.
MS. EOFF: So it doesn't—the reduction in the total budget, by doing this,
doesn't affect what we may have to do with real property rates in order to fund the
budget?
MR. RICHARDS: Well, that's a different conversation, because it goes into two
different funds. I'm concerned about
CHR. CHUNG: Hold on, hold on. Wait. Karen.
MS. EOFF: Yeah?
CHR. CHUNG: This is the same question that Rebecca asked, and
MS. EOFF: Yeah.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: This has nothing to do, will have no effect on the tax rates.
None whatsoever.
MS. EOFF: Okay, because the proposed property tax rates that we had the public
hearing on last night was to raise enough money to cover a budget total of
$585 million.
CHR. CHUNG: Karen.
MS. EOFF: Yeah, okay. I won't waste the time if I'm confused about that.
Okay.
CHR. CHUNG: Okay, so Tim, do you want to make a motion, or
MR. RICHARDS: Yeah, I'll put this in. I'll make a motion to amend 774
MR. HENRICKS: Hold before you do, I'm sorry. So you've got.21 on the
floor, do you want it anymore?
MR. RICHARDS: Which one is .21?
MR. HENRICKS: They're all independent of each other. You're just amending
the budget with these series of communications. So if you don't want.21
anymore,just pull it from discussion.
MR. RICHARDS: So .21's fine. I'm going to leave that one on.
MR. HENRICKS: You can't"leave it on." It either has to be dealt with, voted
on, or pulled back.
MR. RICHARDS: Okay, let's vote on it.
MR. HENRICKS: So in order to introduce a new idea, you have to deal with the
old one first.
MR. RICHARDS: Alright. I got that Jon.
MR. HENRICKS: Okay.
MR. RICHARDS: Okay. No, because I have two and both of them were put on
the table, I'm trying to
MR. HENRICKS: There's only one item that is on the floor right now, it's .21.
MR. RICHARDS: On the floor, but we have the other one on the table.
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Hawaii County Council-43 June 4,2020
MR. HENRICKS: Right. It's a big table.
MR. RICHARDS: It's a very large table.
MR. HENRICKS: It's sitting there waiting.
MR. RICHARDS: It is. We have .21 on the table?
MR. HENRICKS: No, .21 is on the floor right now. That's why you're
discussing it. It's open for a vote. You can withdraw it, you can vote on it, you
could lay it back on the table.
Withdraw Motion MR. RICHARDS: In the interest of moving forward, I don't think this is going
to Amend: pass, and so in the interest of moving forward, Chair, I will withdraw it, .21.
MR. HENRICKS: Now the slate is clear to make another proposed amendment to
the budget.
Comm. 774.23: From Council Member Herbert M. "Tim"Richards, III, dated June 4, 2020,
transmitting a proposed amendment to decrease the Transfer to Capital Project
Fund-General Excise Tax expense account by $7,500,000.
Motion to Amend: Mr. Richards moved to amend Bill 144, Dr. 3, with the
contents of Comm. 744.23.
MR. HENRICKS: So Mr. Richards, you made a motion to amend Bill 144,
Draft 3, with Communication 774.23, correct?
MR. RICHARDS: Correct.
CHR. CHUNG: What was that again?
MR. HENRICKS: Mr. Richards made the motion to amend Bill 144, Draft 3,
with Communication 774.23, which is one of the most recent amendments that
was provided to you.
MR. RICHARDS: Correct. And this was the one where we took the $9.3 million
and reduced it to $7.5, leaving $1.8 million for Deanna to get the projects shovel
ready.
CHR. CHUNG: Hold it. But we still have that tabled.
MR. HENRICKS: No. 774.
CHR. CHUNG: .19.
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Hawaii County Council-43 June 4,2020
MR. HENRICKS: Is on the table. It's sitting there. It's just sitting there waiting.
CHR. CHUNG: Okay, so what are we going to do with it? Resurrect it so he can
amend it, or just withdraw it and ?
MR. HENRICKS: So all of these are independent. We're not amending them
with each other. They all work independently to amend the overall budget,
(Bill) 144, Draft 3. So you can do something with .19 later or not.
CHR. CHUNG: Well why don't we get rid of that first one. Take it off the
table
Withdraw Motion MR. HENRICKS: Okay, so you withdraw your motion?
to Amend:
MR. RICHARDS: Yes.
Vote on Motion Ms. Lee Loy moved to remove Comm. 774.19 from the
to Remove table. Seconded by Mr. Richards and carried by the
from Table: following voice vote:
(Approved)
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
MR. HENRICKS: Okay, so now that's there for you to do as you please.
Withdraw Motion: MR. RICHARDS: Okay, then Chair, I withdraw 774.19.
to Amend:
CHR. CHUNG: Alright.
MR. HENRICKS: Okay, now we have a clean slate.
Motion to Amend: Mr. Richards moved to amend Bill 144, Dr. 3, with the
contents of Comm. 744.23. Seconded by Ms. Lee Loy.
CHR. CHUNG: Do you have a question?
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Yeah, I have a question. I'm just wondering, you know,
because we've heard a lot of discussion on that GET fund and whatever. I was
just wondering if we would entertain the idea of bringing up Council member Lee
Loy's ones so we could know
CHR. CHUNG: You know what? Yeah, good point, but—
MS.
utMS. POINDEXTER: I don't know about the buffet that we have to choose from.
CHR. CHUNG: Two different animals right now. And we're almost ready on
this one I think. Because I'm assuming we're not going to talk another one hour
on this matter, right? We've already all of the information that we need. I mean,
there might be a few questions of Brenda, but you know, I'd like to move ahead
on this thing, one way or the other.
MS. POINDEXTER: Okay.
CHR. CHUNG: Mr. Richards, go ahead.
MR. RICHARDS: I think you very eloquently put we've discussed this already,
so
CHR. CHUNG: And you know,just like everybody else, I love you too, right?
Everybody's professed their love for you. That's a precursor to something. I
don't know what, but—
MS.
utMS. POINDEXTER: That you're going to not vote for him?
CHR. CHUNG: Go ahead.
MR. RICHARDS: No, we've discussed this, and like I said, good fiscal
management is making the cuts now and re-appropriating later and that's what we
need to do. All the indicators are as such. That's why this is a very I'll call it a
novel way to do this going forward. Brenda has said that, okay, we're not going
to be paying for these buses for quite some time. If we have funding coming
forward, I listened very carefully to Finance, they need planning money. That's
recognized in this deal. This will listen to our constituency about cutting budget,
not just saying kicking the can down the road. We've got to cut budget.
But like I said, I'm all for putting it back for Mass Transit if we have the funding
coming forth. I don't want to make draconian cuts later. So I ask for your
support in this amendment. Chair, I yield.
CHR. CHUNG: Okay. Val, I'll give you one minute.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Okay, yeah. Because I think with all the discussion about
GET and real property, I think part of it is the public is thinking, "Oh, we'll cut all
this, now it's cutting from the top, and we're taking care of it." But that's not it.
So I just want to make that clear, because I think that's what Council Member
Villegas and Eoff, and you know, is trying to get clear for the public. Because
we're saying we're cutting it. Yes, we're going to cut the budget, but not really.
Yes means no. I mean, you know, we're not touching real property tax and all.
So I just want the public to understand that this doesn't save them in the real
property tax area like we talked about before. So it gets kind of tricky when you
listen to here we're cutting millions, but yet, you know
MS. EOFF: Thank you.
MS. POINDEXTER: Okay, aloha.
CHR. CHUNG: Okay, anyway. Looks like no further discussion. And you
know, really, Mr. Richards talked about fiscal management. But at the same time,
you guys are our fiscal managers as well, and we kind of vetted that matter. You
know tomato-tomato already. So why don't we take a vote on this matter. Let's
do it by a roll call vote.
Vote on Motion The motion to amend Bill 144, Draft 3, with the contents
to Amend: of Comm. 744.23 failed by the following roll call
Failed vote:
Ayes: Council Member Richards — 1.
Noes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Villegas,
and Chair Chung—8.
Absent: None.
Excused: None.
CHR. CHUNG: So this amendment is defeated. Now, Ms. Lee Loy, this is the
one that is possibly the one that is going to affect the rates. Did you guys hear
that over there in Kona?
MS. VILLEGAS: We sure did. Thank you.
CHR. CHUNG: Okay, thank you. Thank you, Brenda.
Comm. 774.20: From Council Member Susan L. K. Lee Loy, dated June 3, 2020, transmitting a
proposed amendment to decrease the overtime funding from all departments in
the General Fund for a total of$8,184,042, and increase the Finance Department
Administration and Budget Salaries and Wages account by the same amount.
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Hawaii County Council-43 June 4,2020
Motion to Amend: Ms. Lee Loy moved to amend Bill 144, Draft 3, with the
contents of Comm. 744.20. Seconded by Ms. Poindexter.
CHR. CHUNG: Ms. Lee Loy, take it away.
MS. LEE LOY: Thank you, Chair. This is the one that will impact what we set
our real property tax rates at. Like we did last year, I went through the budget and
carved out all of the overtime budget. I know in the past even Mr. Kaneali`i-
Kleinfelder has mentioned we set an operating budget with built in overtime.
Most private sectors don't do that. But I also understand the bargaining unit
contracts that come with setting our operating budget. So this particular
communication really captures all of the overtime, which is the $8.1 million.
In another communication, and that's coming forward, I also went line by line to
look at other areas within the budget specifically as it related to mileage, fuel,
travel, those types of things, in hopes to find a nexus to maybe shift it over. We
heard earlier today that is just maybe not an option. Although I think there is a
nexus, and that's for us as a body to decide.
That particular amendment is another $7.7 million from the General Fund. So I
took a very pragmatic approach to basically find somewhere around the shortfall
of the $14 million that we're trying to close the budget on. So between this
communication and one more that's coming up, we have $15 million in areas that
we can shave off, slim off, do our dance with and slim those budgets down and
adjust the real property tax rate.
Just with this one amendment alone, if we walk back the proposed $14 for the
second tier, we would need to cut I hope I'm saying this right, Steve—it would
be $2.4 from this $8.1. If we put the rates at$13.75, it would be $3.4 from this
amount. If we're down to $13.50, that's $4.4, which is half of this. This is one
option. There's another option of a $7.7 from various accounts and it really is all
those tiny little accounts that added up to this $8.1 and in a future communication,
$7.7.
I think this is where we really need to work hard. I think this is where our Kona
colleagues are looking on how we shave off the budget, slim down the budget, so
that we don't have to raise that second tier as high as it's being proposed. With
that, I'm looking for feedback and how we can find a balance. Strike a balance
between closing this gap, being fair and equitable, and asking our departments to
be fiscally management and prudent over the next six to nine months with this
budget.
There's a lot of hope out there that we might get more monies. We'll know. We
know the economy may or may not get better. But this was my approach to take a
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Hawaii County Council-43 June 4,2020
small step forward, take a little bit of maybe not so much risk but hope that things
will get better and we can reassess and amend the budget as was thoroughly
discussed with the other amendments that we have. Chair, I yield at this time.
CHR. CHUNG: Okay. Ms. Poindexter.
MS. POINDEXTER: Yeah, I have a question for Deanna. So Deanna, because I
like what Council Member Lee Loy's putting forward. Just a question on the
overtime. So we don't plan for the overtime when we set the budget right now if
this goes through. When the CARES Act funding comes in and say the Fire
Department had to deal with a lot of issues, or even the Police Department. Or
whatever, for overtime. That CARES Act funding can go towards that account,
correct?
MS. SAKO: It can. Up through December 30th. But it needs to be substantially
related to COVID for CARES Act.
MS. POINDEXTER: Right. So I like that idea. Yes, it can up until the 30th and
in the meantime, we can start to look at, you know, other grants out there, other
things that may come forward. So I like that from July 1st through December, that
we able to use the CARES Act for overtime that is any way related COVID-19
pandemic.
MS. SAKO: If it's related. So Police and Fire are the easiest to relate, and that's
in the guidance. But for the other department, not. Just because
MS. POINDEXTER: But for the other departments, okay. That I beg to differ.
Because say Parks and Rec, say
MS. SAKO: I'm not saying none of it is. I'm just saying it's not easiest.
MS. POINDEXTER: But say second wave hits, COVID-19. They've got to be
out there doing all the cleaning, all this extra stuff again. You know, that money
can go towards that. Say they've got to stay till 6:00 or 7:00 at night or whatever,
and they're supposed to get off at 3:00 but had a major outbreak they found out
was at some type of pavilion area down the beach at a County facility or
whatever, they've got to get out there. So those kinds of expenses and overtime
will be covered under the CARES funding.
MS. SAKO: Up to December 30, yes.
MS. POINDEXTER: Up until December—and I like that, because that's a lot of
time for us now to keep looking for other grants to supplement our budget. So I
like this so far. I'm supporting it. Thank you.
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Hawaii County Council-43 June 4,2020
MS. SAKO: Can I just make one comment? You know, I just now took the time
to look at this, but this includes some State funding overtime as well. So initially
I think we might have done this last year too, I moved into Finance's budget, but
it was fine because it just sat there and we moved it back. But now if we're
talking about cutting. Like for example, $1.8, almost$1.9 million is paid by the
State for Fire EMS (Emergency Medical Services). I don't want us to start
cutting things that the State is currently paying for, which in essence cuts out
everything.
CHR. CHUNG: Alright, that's a good point. Ms. Lee Loy, you said something
else is coming up, right? But can you maybe adjust your numbers to incorporate
her concern? Okay. And one more thing too, Deanna, what can you live with? Is
this okay? Acceptable? Not acceptable?
MS. SAKO: Right now, this particular one is just to move it into Finance. But
when we start talking about cutting, there are multiple of these that have offsetting
revenue accounts. So I want us to be conscious of that. Because I know
everybody thinks $80 million is a lot of dollars and it is. But we just have to live
within the rules because what we don't want is several years from now for them
to come back and say we didn't play by the rules,we're going to take it back.
CHR. CHUNG: Right.
MS. SAKO: That's worse. So we want to play fair. So while I agree with
everything Ms. Poindexter said, we have been. We keep immaculate records. We
do every disaster. But yeah, we still have to play by the rules.
CHR. CHUNG: Right. So Sue, I want you to articulate very clearly what the
game plan is going to be right now. Put everything into place. Go ahead.
MS. LEE LOY: Thank you, Chair. So Communication 774.20 was just for me to
show this entire body how much money was in overtime. Communication 774.22
actually cuts it in half which provides us enough time during the CARES funding
to capture some of the overtime that is COVID related, keep us going, and still
provide for overtime. That's what.
CHR. CHUNG: So which is the vehicle that's going to be used to amend the
budget?
MS. LEE LOY: (Comm.) 774.22, unless this body wants to figure out how else
we can shave the budget.
MR. HENRICKS: If I may, I think what Sue is trying to say is they need to both
pass for her plan to work. Yes or no? You just wanted to put our .20 for
discussion and .22 is the same thing but with cuts? Thank you.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Okay, because .22 incorporates the—it shaves the overtime
account—well yeah, the original $8 million to about$4 million, right? That
probably will be more palatable to the Administration, I guess.
MS. SAKO: Just a minute. Because I'm already at over—like $2 million of this
is grant funded. So let me finish doing the yes, well like Liquor that has its own
revenue stream that I can't touch. Okay, sorry. So there's $1.908474 of
grant-type funded things here. So the County-funded revenue is less. So the
County-funded revenue is actually $6,275,568. But you know, there still has to
be a nexus to CARES Act. And you know, in addition we're hearing from the
State. The State's already directing us how to use that money. You know, they
have to cut their budget too.
You know, they don't want to fund like Water Safety Officers at Hapuna Beach,
they don't want to fundI think Kua Bay's okay this year, not the following year.
They don't want to fund the raises for EMS. They don't want to fund Paradise
Park, the medic unit. So we've the Mayor's very committee to all of those
things. Those things are very public safety oriented. So we already need to try
and find a way to absorb that$6 million by using CARES Act money. So I know
it sounds easy, but the shift that much over to still have a nexus is very difficult.
CHR. CHUNG: Well, we trust you though. We trust that you can do it, I think.
Ms. Lee Loy, go ahead.
MS. LEE LOY: Chair, and just more information for good decision making, I did
an analysis over the last 12 years of fund balance carry over. On average, that
was hovering somewhere between $25 and $30 million consistently. That
basically means we generated revenues, didn't spend it. So even a small budget
cut of$4 million—and I know Deanna will explain this, I think it's a reasonable
approach that there is still some monies within our fund balance carry over, that
could absorb some of this $4 million which would then we would not have to
raise that second tier category as high, and actually give that a lot more thought
over the next to nine months.
Again, I'm really doing my very best with a very tight budget to at least get us
through the next six months until we can reevaluate how what I think potentially
will be some very creative sourcing of funds. So Chair, I yield at this time.
CHR. CHUNG: So what are we going to go with then? I would say 774.22.
MS. LEE LOY: That is that is my proposal, 774.22.
CHR. CHUNG: But on the floor .20. Why don't you take that off and go with
774.22.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: Chair, I have a question about tabling it. If we table it, then
we discuss this, what if some people will prefer going back to .20. It allows us to
go back to it, right?
MR. HENRICKS: It would be cleaner for her to withdraw her motion. (Comm.)
.20 is still available. She just withdraws her motion for now.
MS. POINDEXTER: Because she could bring it back if need be.
CHR. CHUNG: How about this? Hey Kona?
MS. DAVID: Yes?
CHR. CHUNG: Do you guys like 774.20 or .22?
MS. DAVID: Well, .20 doesn't have any amount,right? It was to demonstrate
actually, showing us what's out there.
CHR. CHUNG: No, it has the $8 million for overtime. And the other one $7
yeah.
MS. DAVID: Yeah, but the one we're talking about right now has the amount
that will have an impact on the real property tax rates, right?
CHR. CHUNG: Both of them will.
MS. DAVID: The $4 million right, is what we're ?
CHR. CHUNG: Both will have. But the 774.22 is probably something that the
Administration could have a better time working with.
MS. DAVID: Well for me, and I won't speak for the rest, I prefer the .22.
CHR. CHUNG: And the reason why I ask that is we might get rid of one of these,
and we don't want to get rid of it and then
MS. DAVID: Okay well I prefer .22, and then I'll let the others weigh in.
CHR. CHUNG: Well, can we just get rid of.20 in other words?
MR. HENRICKS: Mr. Chair, she can withdraw her motion and if for some
reason down the road later in the day today .20's looking good again, she can put
it back on.
CHR. CHUNG: Okay, alright. Let's do it that way. Withdraw it.
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Hawaii County Council-43 June 4,2020
Withdraw Motion: At this time, Ms. Lee Loy announced the withdrawal of the motion to
to Amend: amend Bill 144, Draft 3, with the contents of Comm. 744.20.
MR. HENRICKS: She's withdrawing her motion. And no objection from the
second, Ms. Poindexter?
MS. POINDEXTER: No objection.
MR. HENRICKS: Okay, so that just now you have a clean slate and if for some
reason .20's looking good again, you can make a motion to put it back.
Comm. 774.22: From Council Member Susan L. K. Lee Loy, dated June 3, 2020, transmitting a
proposed amendment to decrease the overtime funding from all departments in
the General Fund for a total of$8,184,042, and increase the Finance Department
Administration and Budget Salaries and Wages account by $4,092,295.
Motion to Amend: Ms. Lee Loy moved to amend Bill 144, Draft 3, of
Comm. 744.22. Seconded by Ms. Poindexter.
CHR. CHUNG: Mr. Richards, do you want to say something about this?
MR. RICHARDS: Are we ready to talk about it yet?
CHR. CHUNG: Yes, we are. We are.
MR. RICHARDS: Well first of all, I fully support this because it is a budget cut.
And this is going to come out of the General Fund, which is fine. And I know this
whole conversation day glaringly highlights the need to do the ad hoc committees
and working through this so we can actually come up with a better answer for our
people going forward. That being said, I do support this because again, I'm
deeply concerned about the income stream that we're going to be facing, and I
don't think we've cut enough.
I appreciate what Ms. Lee Loy has put forth because what we're trying to do is
maintain our employment, we're trying to maintain our function, but you know,
those of us who went through the great financial crisis in '08 through '11, that
was really hard. And this is going to be worse. So I am going to support this,
because I think it's a step in the right direction. And it's just going to be a tough
time. I do not believe we're going to have the income stream. I hope I am wrong,
but I do not believe it. So I will be supporting. Thanks, Sue. I yield.
CHR. CHUNG: Okay. Matt, go ahead.
MR. KANEALI`I-KLEINFELDER: Oh Ashley. Go ahead.
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MS. KIERKIEWICZ: How can you overlook me, Chair? Deanna, I've been
watching you this entire time, and you look really pensive. And I'm just
wondering what Ms. Lee Loy is proposing, do we have between CARES Act and
other funding coming through enough to braid together to cover any overtime that
we typically anticipate on an annual basis. What's your feeling? Do these
numbers work or do you think that we need additional adjustments?
MS. SAKO: So keep in mind that because I said a lot of that$1.9 million was
State or other funded already, that leaves only $2 million in County funded
overtime. You guys are asking us to move over $10 million to CARES Act and to
find a nexus for it. And if you guys don't know me by now, I do not do anything
illegal. I will work with everyone, I will push the button, but I will not do
anything illegal. So there has to be a nexus.
You guys talk about fund balance, okay. What did we budget this year?
$30 million. It's over already on Draft 3. That was the average for the last
several years. We're there already. How are we going to generate fund balance
next year? I don't know, because we cut a lot out of it. And let's not forget that
one of the things we cut is the $20 million that we're mandated to the State to
OPEB (Other Post-Employment Benefits) only because it was a calculated risk.
So fine you want to cut, but if six months from now when you're looking at the
budget and the numbers aren't working, there's no more opportunity to change
tax rates. So something's going to get cut. I don't know what, but something's
going to get cut.
CHR. CHUNG: Yeah, and we fully expect you to follow the law. We don't
expect you to break the law.
MS. KIERKIEWICZ: So Deanna, what I'm hearing is this is going to hurt a lot
and you don't make this you don't recommend that we move forward with this.
I just need to hear you say it.
MS. SAKO: Not—yes, that's correct.
MS. KIERKIEWICZ: Okay. You also mentioned something, I'm glad you
brought it up, EMS Ambulatory Service for Puna, Chief Rosario reached out to all
Council members, sent an email saying, "Hey, State's going to be cutting service.
This is what's going to be impacted." It happens to be in my district, one of the
largest population clusters here on the island. So I'm doing my part to connect
with Finance, State Legislators to see what we've got to do to ensure that funding.
If we're not able to make it because the State's really in a pinch
MS. SAKO: The State is hurting very much, and I totally understand.
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Hawaii County Council-43 June 4,2020
MS. KIERKIEWICZ: Yes. There's commitment from the administration to
continue serving that community of Puna with ambulatory service.
MS. SAKO: Yes, the Mayor is very committed to that. But you know, that's not
something we budgeted. You know, that came up this week. So, and the
Legislature is reconvening the middle of the month, I forget the days.
MS. KIERKIEWICZ: June 15''.
MS. SAKO: So who knows what will happen then. I don't know how many cuts.
These are the cuts we've heard about from the various State departments. There
can be many others that they haven't even communicated to us yet. What if we
lose all of the funding for PMVI(Periodical Motor Vehicle Inspections), CDL
(Commercial Driver Licensing), CZM (Coastal Zone Management), and all the
other State-funded operations. So you know, there's already a lot of strain as we
talked about last time when we did our presentation. You know, this was not an
easy budget, and we still don't have all the answers. And you know, it's
unfortunate that some of things haven't been resolved yet. If we get the CARES
Act for it, yeah, then it's not a problem. But that thing's stuck in Congress and
who knows if it's ever coming out.
MS. KIERKIEWICZ: Yeah, this budget's going to seem easy compared to next
year's I think. So in your professional opinion then, would .20 have been better,
774.20 where we're just simply moving the overtime over under your department
and you would have jurisdiction over, you know,what departments can access.
You're going to really make sure it's meets nexus' and whatnot.
MS. SAKO: Correct.
MS. KIERKIEWICZ: Okay. Chair, I'm going to—you know, Ms. Lee Loy, I'm
wondering if you can take into consideration, take really to heart what Ms. Sako
was saying. She knows the budget I think better than everybody in this room.
And I really defer to your expertise and I appreciate you educating us and
working with us to find solutions. But you know, it's my preference that we lean
on our Finance Director because she does take the time to study all these different
regulations, and we go back to entertaining .20 because I think it's the cleanest. I
certainly don't want to be strapping or compromising any service to our
community. Thank you. I yield.
CHR. CHUNG: Okay. Matt.
MR. KANEALI`I-KLEINFELDER: I've got a couple of quick questions for you.
Thank you for being so honest. You are our Finance Director. Does the current
budget include raises that weren't approved by the Governor? Like all of our
HGEA (Hawai`i Government Employees' Association) contracts?
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Hawaii County Council-43 June 4,2020
MS. SAKO: They do. It includes the collective bargaining unit increases for all
of the bargaining units because we have not yet been told that we don't have to
pay it, even though they have not yet been approved by the State.
MR. KANEALI`I-KLEINFELDER: Okay, because at this point, I mean what I'm
getting, what I'm reading is the Governor is holding it because everyone's in a
pinch and they may not—they may go back to the table with that agreement.
MS. SAKO: They may, but—
MR.
utMR. KANEALI`I-KLEINFELDER: May, but we don't know.
MS. SAKO: We don't know that.
MR. KANEALI`I-KLEINFELDER: So we've included that in the next coming
budget. So if that doesn't go through and a lot of these big union and bargaining
contracts don't go through, are we going to see a substantial savings in our—are
we going to have extra funds?
MS. SAKO: Well, so already HFFA (Hawai`i Fire Fighters Association),
SHOPO (State of Hawaii Organization of Police Officers), and UPW (United
Public Workers), those have all been approved. And those employees are getting
paid the raises. So no matter what, we have to pay that. So the portion in the
General Fund that was attributed to that is I want to say $3.9 million. But that
was the portion we carried forward from this year. So all of HGEA is $8 million
includes the raises for this year and next year.
MR. KANEALI`I-KLEINFELDER: Okay. I think the general consent that I'm
seeing is that this is not a time to come in and ask for raises, unfortunately.
Everyone wants raises, but at the same time, it's not going to be a good time for
that this year. That's part of the shared sacrifice that everyone across the board is
going to have to participate in going forward. So I would hope that if they don't
come through but we don't know. We have to keep it in the budget. But if it
doesn't, then we will have a little bit of extra money to play with. I'm not
pushing one way or the other, I'm just(inaudible).
MS. SAKO: No, no, no. All I wanted to explain is that just as a reminder, three
of the bargaining units received their raised already. So they're being paid no
matter what, unless it's negotiated down. So it's only specific bargaining units
that would not be paid.
MR. KANEALI`I-KLEINFELDER: Yes. Then when do the other—do all the
bargaining units come back up for re
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MS. SAKO: All the contracts are set to expire on June 30, 2021, a year from
now.
MR. KANEALI`I-KLEINFELDER: One year from now they all come up and
they all go back to the table for re-contracting. Wow. That's going to be
interesting. Going to be a lot of push this year from unions I think.
Draft 1, when you submitted Draft 1 this year, what percentage of an increase was
that from last year? I looked in the thing and I think it said $6.9 percent. Is that
correct?
MS. SAKO: Yeah. I have it in the back but yes, that sounds about right.
MR. KANEALI`I-KLEINFELDER: And Draft 2,we came back, we dropped
by ?
MS. SAKO: A little bit. It's very similar to last year's budget.
MR. KANEALI`I-KLEINFELDER: So we're almost—we're about even then
with last year's budget.
MS. SAKO: We're about even with the amendments I think
MR. KANEALI`I-KLEINFELDER: We haven't passed the increase in tax rates.
MS. SAKO: No, that's later on the agenda.
MR. KANEALI`I-KLEINFELDER: That's later on the agenda. And that's clued
from that. It says "proposed rate." But it doesn't say that we—so we haven't
actually passed that yet. Does today's budget that's in front of us, Draft 3, require
us to balance out—sorry, to balance out today's budget in front of us, Draft 3,
does it require us to enact that tax increase?
MS. SAKO: It does.
MR. KANEALI`I-KLEINFELDER: It does require that.
MS. SAKO: Those are our proposed rates. So we have $329 million in real
property tax revenues in the budget; $329,130,000. So you can use our proposed
rates, you can do something else, or you have to cut expenditures if you don't
want to do the proposed tax increase for that one second tier.
MR. KANEALI`I-KLEINFELDER: And we were looking that increase is
supposed to be $12 to $14 million, or $12.4 million?
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MS. SAKO: It was $14 million, because you have to go to the PONC (Public
Access, Open Space and Natural Resources Commission).
MR. KANEALI`I-KLEINFELDER: $14 million was what that rate will get us.
MS. SAKO: Yes.
MR. KANEALI`I-KLEINFELDER: So right now, we're operating and the
budget is coming in at a loss then? You're not balanced.
MS. SAKO: If the rates don't pass.
MR. KANEALI`I-KLEINFELDER: If we don't pass the tax rate. So just to
revisit a little bit, 774.20, the communication put forth by Ms. Lee Loy, that really
did nothing except I mean it's very similar to what we did last year.
MS. SAKO: It just moves it, yeah.
MR. KANEALI`I-KLEINFELDER: We put it right back into your account, you
move it back, which requires a resolution so we can see when the funds are being
moved.
MS. SAKO: Correct.
MR. KANEALI`I-KLEINFELDER: So this is really just kind of actually like
tidying up what we did last year. Making it a little bit cleaner and prettier. Two-
two (.22), the one we're talking about right now is actually decreasing what we
were going to be putting out in overtime. What we're funding in overtime across
the board. And .22 a decrease in what$4 million in overtime?
MS. SAKO: So that leaves $2 million to fund all the overtime for Police and Fire,
some of which is mandated by contract.
MR. KANEALI`I-KLEINFELDER: And we still haven't touched on the
$14 million we're short if we don't do a tax rate increase.
MS. SAKO: Right. If the budget's in the Council's hands, it's up to you guys to
balance it.
MR. KANEALI`I-KLEINFELDER: Wow. So we did pass this—say we passed
.22, we're now $4 million plus, except we're still $14 million short without doing
the tax rate increase.
MS. SAKO: We have submitted you a balanced budget. So yes, if you choose
not to pass those rates, Council has to balance it.
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MR. KANEALI`I-KLEINFELDER: Wow.
MS. LEE LOY: Chair?
MR. KANEALI`I-KLEINFELDER: I yield for now. Thank you, Deanna.
MS. LEE LOY: Chair, may I just clarify a little bit to help?
CHR. CHUNG: Go ahead, yeah.
MS. LEE LOY: We have a$14 million budget shortfall without passing any tax
increase. My demonstration was so show we have $8 million in overtime. If we
adopt .22, we will have shaved off$4 million which leaves us a budget shortfall
of$10 million, which would then set the stage on what we set the real property
tax rates in that second tier. I'm trying to be very pragmatic and step by step on
this.
Again, I also have one other area in which there's $7.7 million in General Fund in
which we can shave off. So if Deanna is having a heartburn on where we are on
cutting half of overtime, this body can decide where we want to do that and even
take up another area in which I found $7.7 million in the General Fund that we
can shave off in hopes that we would not have to increase that real property
second tier to what was being proposed by the Administration to close the
$14 million gap in our budget. I hope that helps. I'm trying to be real
MS. EOFF: Mr. Chair? Oh, if you're done, Ms. Lee Loy.
MS. LEE LOY: I yield.
CHR. CHUNG: Karen.
MS. EOFF: Okay. Yeah, thank you for that. That was stated very clearly. In my
conversation with Ms. Sako before, I am understanding that I know we're not
talking about the tax rates yet, but as it applies to looking for how we're reducing
this overall number, going down about$1, so instead of increasing the rate or
setting the rate at$14.6, if we were to set it, according to this amendment, it could
possibly go down $1. I think we'd still be looking at the $10 million shortfall. So
every dollar we go down, I think she told me represents about$4 million.
MS. SAKO: That's correct.
MS. EOFF: So I understand what you're trying to do here. The concern I know
heard from Ms. Sako though is about the approximately $2 million that we might
not be able to take out of this, which would reduce, if you make an amendment to
this it would bring it down pretty—half again, right?
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MS. SAKO: So right now,just with the numbers it's really reducing the County
funded overtime by two-thirds.
MS. EOFF: So we would not be—it wouldn't be good for us to pass 774.22 as is,
correct?
MS. SAKO: Correct.
MS. EOFF: Okay, well—and I don't think we have the other proposal. Has that
been passed out yet? Another option of looking at cutting? Have we got that?
MS. LEE LOY: Yeah, it's being prepared by staff now.
MS. EOFF: Do we want to table this too? I mean, we may have to door we
may decide to do both things in some way.
CHR. CHUNG: You know, in any event I'm going to take at 12:30, so this might
be an opportune time and come back at about 2:00.
MS. EOFF: You know, I appreciate that we're working hard to try and find cuts,
or a way to cut down our budget. I think most of us may really want to do that.
And I'm not sure how far we can get and whether it will end up being a
worthwhile effort, but I really like that we're working on it. It shows
CHR. CHUNG: Yeah, and you know, it might end up as being a combination of
several versions. So but let's keep talking for the next 10 minutes and take a
recess.
MS. EOFF: And then maybe a break. I yield.
CHR. CHUNG: Matt, go ahead.
MR. KANEALI`I-KLEINFELDER: Thank you, Chair. Sue, thank you for
summing that up. But I'm there. I can see it. We're $14 million short unless we
do the proposed tax rates. With $4 million, you've got a proposed $4 million cut
to overtime which I think it important because it sends a clear message. Because
as a business owner, you know, get overtime, it's a huge expense and it sucks.
Deanna, I'm with you because you're scared because if we do that, when I call the
Fire Department and I get I'm having a fire and they say
MS. SAKO: When you get an answering when you call Fire, then maybe you'll
understand.
MR. KANEALI`I-KLEINFELDER: "Sorry, we're not available right now, deal
with the fire yourself." That's not good. But we have to make these cuts because
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Hawaii County Council-43 June 4,2020
we have to show. So maybe not a substantial cut, but a little bit less. Then going
a little bit further, two other areas. Public Franchise Tax, are they maxed out on
what we can collect from them? That's a State-set tax rates on the public
franchise.
MS. SAKO: The franchise tax goes into the Highway Fund and it is based on
revenues of the utilities. So the utilities are seeing a significant decrease or
decline in their revenue, like HELCO (Hawaiian Electric Light Company). So we
have reduced that estimate in the coming year's budget.
MR. KANEALI`I-KLEINFELDER: But are we collecting the maximum that's
set by the State?
MS. SAKO: Yes, we are. It's set by State law, yes.
MR. KANEALI`I-KLEINFELDER: I was hoping we could (inaudible).
MS. SAKO: Same think for Public Service Company tax, which is set by State
law.
MR. KANEALI`I-KLEINFELDER: Okay, thank you. Then last, we have a
Rainy Day fund, yes, in this County?
MS. SAKO: When revenues do not come in as high as anticipated, we can tap
that. There only about$6 million in that fund.
MR. KANEALI`I-KLEINFELDER: It's raining.
MS. SAKO: I'm not saying it's not raining.
MR. KANEALI`I-KLEINFELDER: Just think, we have it there, and we have it
there for a purpose. So is that something that we can look at to
MS. SAKO: I cannot budget it.
MR. KANEALI`I-KLEINFELDER: Can't budget it.
MS. SAKO: You cannot budget it. The way the law is written, you can't budget
it, but if next year revenues don't come in as high as anticipated, we can tap that
fund. But once it's gone, it's gone.
MR. KANEALI`I-KLEINFELDER: Yeah. So personally, I would use a
portion
MS. SAKO: So you have to hope for not a continued rain storming. That's
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Hawaii County Council-43 June 4,2020
MR. KANEALI`I-KLEINFELDER: And leave a portion so it hopefully stops
raining and you'll always have a little bit of a cushion there to. But that, I think it
might be necessary to use that. And I get it, honestly, so we can't budget it, but
know that we can use that coming forward. Because I think we're all aware that
it's raining outside. If you don't look outside right now, it is raining.
MS. SAKO: I know. It's Hilo, it rains at some point.
MR. KANEALI`I-KLEINFELDER: Okay, well I think my position will be cut
overtime. Maybe a little bit less this time. I never want to call EMS or 911 and
get an answering machine. And last year the Fire Department was very clear that
if we cut their budgets for overtime, which is a budgeted item which really hurts
because we know we're going to be spending a fortune on that, but I think we
may have to. It's just, it's part of the deal. That's what that shared sacrifice is
going to come down to. I yield, thank you.
CHR. CHUNG: Val.
MS. POINDEXTER: Yeah. So I agree. Rainy Day Fund, it's raining. Got to use
it and that's the reason why we have it there. Eighty million, I don't want to get
away from $80 million CARES Act funding, because that will be used. We're
going to be watching that real careful. As far as going to the Legislature to try to
make amendments to that CARES Act funding, hey, we've got good lobbying
Council members here that work really well with the State Legislators that I'm
sure will want to help us in the County when it comes to, I call the Fire
Department, I get the Fire Department. Because we're talking about the overtime,
and that's—we're looking at other funding that may be able to take care of that.
It's out there.
MS. SAKO: So just to clarify, the CARES Act funding coming from the State is
not like the lava funding that was State money that they could control the use of.
The State has to follow the federal rules and our agreement with them is 19 pages
long.
MS. POINDEXTER: Right, and I've been reading the CARES Act funding, what
it can apply to, and
MS. SAKO: Yeah, I just want to clarify that the Legislature's not going to be
able to amend that.
MS. POINDEXTER: So that$80 million that we're getting in, anybody can go
online and look what the guidelines of the CARES funding act is, and it does
allow for anything that is related to COVID-19. Now, we're going to have—we
have a lot of expenses right now that is going on because of COVID-19. I don't
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Hawaii County Council-43 June 4,2020
know, in the millions probably already. You know, so we know that's not going
to end. So we're not able to put it in the budget because we cannot assume where
it's going and what it's related to at this time.
We probably could, you know, because we know already what Parks and Rec is
doing, DPW is doing, all the safety things that they've got to put in place to make
it safe during COVID-19. So we have a lot of expenses that that$80 million can
be used for. So I'm for cutting the budget and working with the Legislature and
help seeking out other funding if we need to, and helping the other departments.
So right now, we've got to do what we've got to do.
And I would hate to keep raising those property taxes. None of us want to raise
the taxes. You know, it's a difficult thing to do. So I would rather be in a
difficult vote with helping our taxpayers and then us going out to work and trying
to figure out where we can get money from to help supplement other areas when
we have a shortfall. So I'm going to support whatever cuts come forward. Okay,
thank you.
CHR. CHUNG: Anybody in Kona?
MS. EOFF: Mr. Chair, I was just going to add on to what Ms. Poindexter said, is
I think at any rate, even if we find these cuts and hopefully we will do them so
that everybody feels comfortable about it, there's still going to be a need to raise
that tier-two money at some rate. I don't think we're going to get to where we
don't have to raise taxes at all. That's just my outlook right now and I'm just
hoping we can find some relief.
CHR. CHUNG: I think it's inescapable actually.
MS. EOFF: Yeah.
CHR. CHUNG: So good point, Karen.
MS. EOFF: These are big amounts of money, and I believe that, as
Ms. Kierkiewicz did state, there's so many moving parts and I do trust Ms. Sako's
analysis and concerns when she says what we need to be aware of. Because
sometimes it's not as simple as it seems. So yeah, I agree with you, Mr. Chung.
CHR. CHUNG: Okay. Mr. Richards.
MR. RICHARDS: Sue's afraid for me to say anything, I think.
CHR. CHUNG: We'll give him three minutes. Go ahead, Tim.
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Hawaii County Council-43 June 4,2020
MR. RICHARDS: A couple of things. First of all, Deanna, the comments about
the funding for our lifeguards, we all got the call from Chief, and that has been
eliminated from the State, correct? So the total is how much for that? That
contract?
MS. SAKO: Closer to $900,000 for just Hapuna. Kua Bay I believe the funding
is in there. That was just a specific appropriation.
MR. RICHARDS: That's guaranteed four more years.
MS. SAKO: Yes, $900,000 is just for Hapuna Beach.
CHR. CHUNG: What about Kua?
MS. SAKO: Kua Bay is in the budget till June 30, 2021, then it's up again.
MR. RICHARDS: Okay, and so where are you going to fund it from? Because I
know Chief said that Mayor said we're going to fund it, but where are you going
to pull that money from?
MS. SAKO: The Water Safety Officers are actively patrolling the beaches, and
ensuring public social distancing, and public safety, so we will find a way.
MR. RICHARDS: So you don't know where you're going to fund it from yet?
MS. SAKO: You've missed the key words. They're monitoring social distancing
and public health and safety.
MR. RICHARDS: But it has to be expended by December 31st. Okay. And I get
that. You know, we talked about the cutting but we're not doing the cutting that
we need to get done. I appreciate that this is going to be problematic going
forward and I listen very carefully to what people are saying. But again this goes
back to the whole point, this is a hard time. The State's budget, roughly speaking,
$15.5 billion; they're looking at between
MS. SAKO: Two point five ($2.5 billion).
MR. RICHARDS: Two and two and a half billion loss in revenues, which is in
between 15 and 20 percent. Why do we think that we're not going to be the
same? So we're not getting our TAT (Transient Accommodation Tax), I get that.
We're not cutting enough. So with that, Chair, it's lunch time. I will yield.
CHR. CHUNG: Okay. Let's take a lunch break. Take a recess, okay? And in
the meantime, is there anything you need to get to each of the Council members,
or everything's here already? Try to get that out to us as soon as possible.
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Hawaii County Council-43 June 4,2020
MR. HENRICKS: Can you announce when we'll be coming back for just the
public and the staff?
CHR. CHUNG: Yeah. We'll come back at 2:00 o'clock.
MR. HENRICKS: Thank you.
Recess: At 12:31 p.m., the Chair called for a recess.
Reconvene: The meeting reconvened at 2:00 p.m.
CHR. CHUNG: Okay, we're out of recess. Let's continue. What do we have
right now. Where are we?
MR. HENRICKS: The motion is to amend Bill 144, Draft 3, with
Communication 774.22. The floor is open.
CHR. CHUNG: Please, Ms. Lee Loy.
MS. LEE LOY: Yeah, thank you, Chair, and thank you for a nice long lunch,
Chair. I really appreciate it. So again, Communication .22 again showed the
overtime budget at$8.4 (million), cutting it to half. I think just summarizing, and
Deanna you can jump up there any time. This was just cuts with a dull axe, right?
Just being fair. There's been conversations about there's some of that overtime
funding that might be State or some other places. In addition to this, I also have
one more area in which I found money. So this body has an option to dial this
number around along with another communication that I have, which I shared,
where we found $7.7 million in the General Fund.
So if this body would like to entertain adjusting these amounts with overtime and
then this other amount to somehow close the gap on that$14 million that is in the
whole, we can continue that conversation.
MS. SAKO: Can I just make a recommendation that the grant funded overtime
get pulled out of here entirely? Because it's really kind of clouding the
conversation. That is nearly $2 million of money that, you know, someone else is
paying for and to take only half of it when we're putting it back in, it's just king
of really messing it up. So that might be step one so that we can compare apples
and apples.
MS. LEE LOY: Okay, Deanna—and I really am trying to keep this simple. I had
to show where all the money was. So the first step like we did in the past was just
to shift it all over to you. So the other option could be take it, shift it all over you,
cut if off over there where you can assign it to make sure. I'm trying to keep it as
simple and as vanilla as possible.
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Hawaii County Council-43 June 4,2020
MS. SAKO: So it's one thing to shift it all to Finance, but to cut even a grant
funded in half which is what this is reflecting, doesn't make sense. So the grant
funded overtime really needs to be in there at 100 percent. Nobody's saving
anything at that. It's just an unbalanced budget at that point.
So I think that has to be like the first step, because I think to cut$4 million out of
what's really only $6 million in County, that's two-thirds. And you know, some
of the contract positions have things like rank for rank that we can't get away
from paying. No matter how hard we try, we can't convince or shift everything
over to coronavirus. You know, there's a lot of things that we're still working
out. But there's rules that we have to follow, and we're going to live within those
rules.
MS. LEE LOY: Absolutely. And you know, I completely understand the
bargaining unit agreement and basically being legally bound to those. So again,
this was my opportunity to show this body where I found $15 million. The need
to have this conversation to really understand if it's really $15 or is it closer to
somewhere between $8 or $9, shaving off the grant funded or some of the
bargaining unit contract money. I'll be more than happy to continue to work with
that. The staff has this all on a spreadsheet.
So I really am looking for your help, Deanna. Do we take this amount down by
one-fourth and then tackle the next one, and then that way once we know what
number we're shooting for, we can then begin to address what kind of shortfall
we really have in the budget?
MS. SAKO: Yeah, I just think it's unrealistic to take the $4, you know, so if
there's really only $6 left, you know, a fourth of that is $1.5 million. But yeah.
We're being asked to shift a lot. And you know, I think there's some confusion
too that people think we're just shifting from the current budget to CARES Act.
A lot of the stuff that CARES Act covered is not even in our budget. All the
temporary staffing for Public Works and Parks to clean all the facilities, that's not
in the budget. That's coming directly from CARES Act. You know, all the PPE
we had to buy, all the disinfecting, that wasn't in anybody's budget that we're
shifting over, it's still not in anybody's budget. And I think the budget message
mentioned that too.
So you know, I think we have to be careful that we're not really saving because of
CARES Act, you know, it's providing a need. And while we're doing our best to
shift and pay for everything that we can, those continued needs continue to arise.
MS. LEE LOY: Yeah, and thank you for that, Deanna, because I think we are
learning some of the trends, right? We're understanding the hours that this is
taking, what kind of time it's costing us, what kind of equipment it's costing us.
So it does actually provide us a better snapshot to build a better budget, knowing
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that this actually will be part of our lifestyle at least for another year or two. So I
really am trying to focus on the lessons that we're learning through this and then
budget accordingly.
And just like Roy said yesterday, you know, how to we build a better budget
learning from lessons here that we've learned. So Chair, with that I yield.
CHR. CHUNG: Let me ask you a question before I call on—I thought you had
your light on? Well before I call on Matt.
Would the proposals that you had offered up, what kind of corresponding
decrease in the tier-two rate were you looking at? Presently we're looking at a
$3.50 increase, right, but what were you looking at?
MS. LEE LOY: Yes, thank you for that, because I wanted to make sure I was
answering it in the way that you understood it. So if it's a $3.50 increase, I was
trying to target it to about a $2.50 or $2.75 increase. And then based on that, we
would have to shave off somewhere between $3.8 and $4.2 million. So
depending on where we land with that number.
CHR. CHUNG: So $4.2 would bring us to about$2.50, $3.8 about$2.70 or so?
MS. LEE LOY: About there, yeah.
CHR. CHUNG: Then let's work it backwards then. I'm going to throw this at
you, Deanna. If we set the rate at let's say $2.50 or $2.70, whatever the case may
be, where would you shave? Because that's what we're trying to do, and you
know, we're being blocked at each point. And we understand it, and maybe this
is something we should have engaged your department on. But you know, this
thing has been so dynamic, so fluid
MS. SAKO: And the information changes every day.
CHR. CHUNG: Every single day.
MS. SAKO: Every single day, and you know, so I plan or try to plan for the
future. My big fear is a second wave. Not maybe our island, you know, so far
we've been good. But what does it to do our economy? You know, what if we
have to shut back down again? And those kinds of things, you know, it's kind of
the same thing Mr. Richards is concerned about. You know, is our revenue
estimate too high. So you know, you guys talk about Rainy Day Fund or things
like that. Well, we kind of already took that into account when we lowered the
delinquency rate from ten (percent)to eight. Because you know, we kind of
we're like okay, if we do miss, we at least have that fall back on. Hopefully we
don't have to use it.
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But if we hit a second wave and people just can't get back work let's say, then
you know, I don't know what we're going to do. Once we get into the fiscal year,
it's not like we can go back and set rates again. Those are done for the year. So
you know, I don't know what happens at that point, but definitely positions are
not going to get filled, whether—you know, no matter what it is.
CHR. CHUNG: Right. Well you said a good backdrop to my question, but didn't
answer my question.
MS. SAKO: Well, I didn't want to say I probably wouldn't have done
Contingency Funds, and I probably wouldn't have done West Hawaii golf and
some of those things that got added last time.
CHR. CHUNG: Okay well. Okay, but that's really manini in the whole scheme
of things. And I understand, that's true.
MS. SAKO: But you know, every department's going to have to take additional
cuts, and they took cuts. They took big cuts, most of them. You know, so
CHR. CHUNG: So where? What would you do?
MS. SAKO: Well you know, I said a little bit of overtime is fine, the other
amendments, I'm not sure are going to be legal. That's the situation where we're
at.
CHR. CHUNG: Which ones?
MS. SAKO: Well I don't think they're on the table yet.
CHR. CHUNG: Oh, okay. What about this other thing that you brought up?
MS. LEE LOY: (Inaudible—off microphone).
CHR. CHUNG: Okay, so a little bit of the overtime, about how much?
MS. SAKO: I think I said $1.5 (million). But I still don't know how we're going
to cover that.
CHR. CHUNG: You know, there has to be some degree of risk taking over here.
And it's got to be calculated risk. You know, this whole situation is going to
carry a lot of risk. For example, as you said we don't know what's going to
happen in the future. I am pretty damn sure we are going to have a second wave.
But that's only what I think. But we have to be able to roll the dice a little bit on
this. I'm banking on that HOMES Act(CARES Act) coming down the pike.
Very risky. You know, it's being held up in the Senate right now. We don't
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know exactly what's going to happen. But I think, my intuition is more than
likely it's going to come to pass. There's other things that can happen. With
regard to even the $80 million. We don't know. Those things could be tweaked
at the federal level that might enable us to balance our budget. I don't know.
I'm not banking on that. But we have to build in some risk in all of this, and it's
got to be calculated.
I know you as a fiscal manager have to be really, really careful on these things,
but as policy makers we have that luxury. We can kind of be a little bit more
risky I think, as long as it's intelligent risk.
MS. SAKO: Well it has to be intelligent risk, but we're going to have to be able
to meet and pay the bills when they come due.
CHR. CHUNG: Of course.
MS. SAKO: You know, and so taking it and then if these things happen, and let's
say they do happen, and it generates a fund balance, then we have the luxury next
year to adjust tax rates or you know, and reduce them or whatever. But you
know, yeah. We have to be able to pay the bills when they come due, and I'll
leave it at that.
CHR. CHUNG: Well we could even fill in the gaps with regard to overtime and
other things like that, right? Those supplementals? But anyway, Matt, go ahead.
MR. KANEALI`I-KLEINFELDER: So on lunch break I had thought about what
you were talking about. And Aaron just touched on one of my questions so I may
revisit it but not I think we're on the same track. If we don't pass the RPT (Real
Property Tax) increase, then what happens in your eyes? What is going to
happen?
MS. SAKO: Then we have an unbalanced budget and an amendment is needed.
MR. KANEALI`I-KLEINFELDER: And then Aaron asked, where would you
start cutting and I think that's the next question, because it's just progressing
through. Because I mean we're going to have to make a decision at some point.
That's what we're looking at.
MS. SAKO: Well you know, the departments cut a lot to get us to where we're
at, at this point. It's not like we're starting with last year's budget. This is
already a reduced budget that we came in with. And I know it might not seem
like it, but you know, we have the ERS (Employee Retirement System)rate
increases, we have the salary wage increases that are in there already. You know,
we found a way to compensate for them. We're not paying the OPEB (Other Post
Employment Benefits). You know, so if we're going to cut, I'd put it back into
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OPEB first. That's definitely one of the things. But you know, we're trying to
make all these accommodations hoping for CARES-4 and hoping for something
and you know, we're going to end up probably with zero fund balance the
following year if these things don't happen.
MR. KANEALI`I-KLEINFELDER: Okay. Where would we get funds from?
MS. SAKO: We have to cut expenses. I mean, because there's no other way to
generate revenue. So if the rates aren't there, you know, and so it only generates
the $14 million less in revenue, then we have to cut expenses. And since a
significant portion of our General Fund budget is salaries and wages, I mean,
that's what's going to happen. At some point, there's no other option.
MR. KANEALI`I-KLEINFELDER: Can we legally do that without Governor
approval?
MS. SAKO: No. We have to negotiate. I mean, that's back to a lot of things in
the message that, you know, we'd have to negotiate something or freeze hiring.
But that only goes so far.
MR. KANEALI`I-KLEINFELDER: And then the other way I was looking at
was, you know, we had COVID for the last two months. We saw a lot of
closures, you know, even in our own offices we have staff on Admin leave
coming back and watching the back and forth with HR (Human Resources) about
I think there's two-thirds pay of you have childcare concerns.
MS. SAKO: For federal leave, yeah.
MR. KANEALI`I-KLEINFELDER: Also I notice different department have
projects slated that they weren't able to get to this fiscal year. So do we have
surplus from staffing, from projects that weren't completed? Is there any surplus
that hasn't been accounted for that we can move into next year that's not in our
fund balance right now, or that's not in budgeted fund balance?
MS. SAKO: We tried to take that into account. And a lot of departments know
that their budgets got slashed for this coming fiscal year, so they're trying to
encumber now. So yeah, I don't think there's going to be a lot left on the table.
MR. KANEALI`I-KLEINFELDER: Okay. Do any of those costs that were
incurred because to me, they were because we closed for COVID. Do any of
the costs that we incurred during those times you know, all of our Admin leave,
any of that. Do any of those qualify under the CARES Act that we can apply
funding for?
MS. SAKO: My understanding is no.
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MR. KANEALI`I-KLEINFELDER: Going forward, anyone on CARES Act
Family First leave, are those COVID?
MS. SAKO: No, I believe it's spelled out specifically in the guidance that's not
covered. And it's a federal mandate so we don't have an option, we have to offer
it.
MR. KANEALI`I-KLEINFELDER: So we don't have an incredible amount of
surplus from being like our Parks facilities,pools, closed for two months.
MS. SAKO: No, I'm not say we aren't having some, but we tried to take that into
account early when we did our fund balance projection. Then what we're seeing
now is that they are encumbering whatever they can because they know they still
have a need. The General Plan is one of the things that got reduced drastically in
this coming year. So they're trying to encumber it now to make sure they can
cover it.
MR. KANEALI`I-KLEINFELDER: Okay, so you've thoroughly gone through
and looked for any surplus that we were going to have this year.
MS. SAKO: We've tried our best, but you know, we do it, it's an estimate, we
can't guarantee every move the departments are going to make. But the
departments are working hard to control expenses to try to lapse as much as they
can. You know, but and we won't know for sure either until we get our final TAT
payment what the actual amount is, because revenues are definitely down too.
MR. KANEALI`I-KLEINFELDER: Okay. Is there a possibilityI mean, I was
looking through different things, and I did see an article in the past few days that
the State had actually pulled, according to the article, quietly pulled a $600
million loan to float the State. Is that a possibility for our County to do? Instead
of raising tax rates which is always, you know, something that we don't want to
do, can we pull a loan to cover ourselves for the $14 million shortage or whatever
we do end up at the end of today?
MS. SAKO: We can check with Corporation Counsel, but my understanding is
no, that whenever we've borrowed or thought about it, it's been more like a tax
anticipation note. So you have the revenues in place, and it's just a timing issue.
Maybe people pay late, they don't have money, they can't pay. You can borrow
to cover the cash flow, but not like to balance your budget basically. I would
think that would also severely impact our bond rating by the way.
MR. KANEALI`I-KLEINFELDER: If we pulled a loan.
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MS. SAKO: Well, a loan to balance the budget. You know, it's one thing to
carry you through on cash flow because payments aren't coming in as quickly, but
it's another to actually balance your budget on borrowing.
MR. KANEALI`I-KLEINFELDER: And kind of stemming from what Tim had
said earlier in his closing statement, we don't know what's going to happen. Let's
say the economy takes a crap and we don't see RPT coming in and we don't get
the income we even expected now that it's lowered. Where do we pull these
funds from then? You know, say in six months.
MS. SAKO: Then we can talk about using Rainy Day Fund. Then we can talk
about borrowing. Because with real property tax we do have liens on parcels so
it's kind of a timing issue more than anything.
MR. KANEALI`I-KLEINFELDER: Okay, thank you. I'm just working different
sides of it to see where, hoping to help. Okay, thank you. I yield.
CHR. CHUNG: Okay, how about this, Deanna? And this is really borrowed
from one of our colleagues in Kona, but I don't want to mention names right now
unless they want to reveal themselves. But what about the possibility of
suspending—and I know it's probably illegal—but suspending the land
acquisition monies and paying them back later on. Interest free of course.
MS. SAKO: We have definitely done that in the past, but at that time it was only
in the County Code. It wasn't in the Charter.
CHR. CHUNG: It was an ordinance, right, not a Charter.
MS. SAKO: So you'd probably need a legal opinion on that.
CHR. CHUNG: Maybe the Mayor can declare emergency again. I mean for that
specific purpose.
MS. VILLEGAS: Chair Chung?
CHR. CHUNG: Yes, go ahead Rebecca.
MS. VILLEGAS: I just had some question, if I could interject?
CHR. CHUNG: Go ahead.
MS. VILLEGAS: I've been looking at some information about the Federal
Reserve's municipal liquidity funds, and just looking up that they can provide up
to $500 billion in short term loans to eligible users, which include states, certain
counties and cities, and multi-state entities. So in the document that I was looking
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at it was more related to the State being able to do this, and it says that according
to the State Constitution it authorizes General Fund expenditures in excess of
revenues when the Governor publicly declares the public health safety or welfare
is threatened and may issue bonds to meet emergencies caused by a disaster or act
of God. And it seems that this provision exists for precisely the kind of
emergency we're currently facing and while in this document it's more relevant—
it's
elevantit's pointing out the State's opportunity to utilize this funding stream, my question
is, is there opportunity—it doesn't seem to appear from the National Law Review
that there's anything prohibiting the County from doing something like that.
MS. SAKO: So that particular program was part of the CARES Act and it does
have to come through the State. The State did include us in the borrowing
authorization that the Legislature approvedI believe they approved it—but I
believe it's all capital related. And if so, because the bond market was kind of
going crazy at the time that the stock market was, it was an opportunity to get low
interest capital funding to continue projects and other things that may have been
in place.
MS. VILLEGAS: And in layman's terms, can you translate that, Deanna?
MS. SAKO: It's for the CIP budget, not for the Operating Budget.
MS. VILLEGAS: Okay, got it. Okay thank you.
MS. SAKO: Sorry, my bad.
MS. VILLEGAS: No, no, no. No worries. You're an expert in your field.
MS. SAKO: We really have looked at everything. I mean, we spent a lot of time
working on this budget before we submitted to you guys.
MS. VILLEGAS: I just have one more quick you know, and I realize that a lot
of the bargaining units have already closed out and raises have been approved and
whatnot. It just seems in really poor judgement for anybody to be negotiating
raises at this time. So I guess I'm hopeful that I don't know. Is there any way
for any of those bargaining units to suspend those raises until we as a County and
a State, and even a country can navigate our way out of these crises? I mean the
whole world, it seems every economy, every municipality, is having these
conversations. And these are extreme times and figuring out extreme measures.
MS. SAKO: So Bill Brilhante does represent us with the statewide collective
bargaining group. They are meeting weekly, daily, hourly. I mean so there's a lot
of discussion going on, but one of things is the Legislature still has some bills
before them that I think they probably need them to vote them up or down in
some cases to be able to continue. But they are actively working on all of it.
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MS. VILLEGAS: Okay. What about spreading out some of theI mean none of
us want to increase taxes, and I've had a lot of people in my ear lately about
spreading it out across more classes than just this one new class that was created,
what, 15 days ago? It's all come pretty quick and flurried as everything else
that's going on, and so when I look at our property tax classes and I see hotel
being what it is,just all the different levels here. Mind you, I'm a rookie when it
comes to navigating or trying to strategically figure out how these numbers came
to be. I guess I'm wondering at the opportunity for more classes to share.
MS. SAKO: I think the rates aren't on the floor right now, but yes, it doesn't
have to be exactly what we submitted. The target goal, you know, is whatever
real property tax ends up being at the end of these amendments.
MS. VILLEGAS: Okay, I yield for now. Thank you.
CHR. CHUNG: Ms. Poindexter.
MS. POINDEXTER: Yeah, and I've just got to say this, because you know me I
through everything out on the table. No hidden agendas. What gets my blood
pressure boiling is here we are at this very moment in this mess trying to figure
out how to cut expenses. Yet when the Legislature took a break, didn't have
anything, didn't have anything, we didn't cut the contracts that were made. I
mean, God bless him. I love Andy Levin. He's a personal family friend. It's not
attacking him personally. It's saying that our Administration at those times
should have been looking to cut expenses. And we didn't. But now we come
before this Council and now we're trying to figure out how we're going to do it.
So I just had to share that, because that pisses me off. It gets my blood pressure
up because we could have done so much more ahead of time. And I think some
of the other contracts too, that Mayor has had that I heard of, and I wish I could
check into it, but it just gets me going crazy when some things we didn't need we
could of held off on. Every little penny counts. Now here we are at this moment
trying to figure it out. But who pays? All of us, out of our pockets. Taxpayers.
So that's what's just so uncomfortable for me. I yield. Sorry, Chair. I just had to
share that.
CHR. CHUNG: That's fine. You don't have to apologize to me. Okay I see
everybody's speechless right now. So where do we go from here? We've got to
do something. Go ahead, Sue.
MS. LEE LOY: When the budget came out, that was my tactical approach, which
was what do we want to set the real property tax rates, which was fair and
palatable, provide us some time to figure out if we're going to have to adjust it,
and walk down the expenditure. My staff, Legislative Auditor's Office, our
Deputy County Clerk, honed hard. And I found it. And as a body we've got to
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start hammering in the numbers at this point. The only way we can relieve
ourselves of a tax increase is to cut expenditures. Please keep in mind whatever
we do with the real property tax revenue, the revenue can be a little more than the
expenditure. It just cannot be the other way around.
You know, you brought up an interesting point, Chair, that using some of our
other funds, I looked that up actually when all of this came up. There's
provisions for emergency proclamation, some other provisions in our Charter
where we can grant one half of one percent. Is that correct, Mr. Richards? One
half of one percent. So there's tools within the Charter under an emergency
proclamation that we can use. We've just got to start putting together the
framework what our decision-making processes will be and start putting them
together. That's where I'm at. I'm looking for guidance. Deanna, you know, like
I said, staff has all of this in spreadsheets. Let's get to where we're going to cut
expenditures.
CHR. CHUNG: Tim, go ahead.
MR. RICHARDS: Thanks, Chair. We're talking about the General Fund now.
We're only talking about the General Fund. We spent almost talking about the
GE fund, and this Council didn't have the courage to cut there. Now we're going
to cut on the General Fund? I agree we have to cut and we have to cut hard,
because I'm deeply concerned about the finances coming forward. And Val,
you're exactly right, we're all going to pay for it. The problem is we have to do
what we can to manage and mitigate.
Chair, I agree with you. We're going to have to take a risk. We're going to have
to do that. These are, again, unprecedented times. And it's overstated. And
Deanna, I know you guys have busted to try and get this thing done. Part of the
problem with this is our budgeting process, which is flawed. And I've said this
since I've been this Council. That being said, this year it came too fast, too hard,
and there's just too much. It's evolving. I'm sure it's evolved even when we
broke for lunchtime. It continued to evolve.
We're going to have to make some very difficult decisions now, with the intent of
fixing it as it comes forward. We have to have a balanced budget. I don't support
a rate increase for all the reasons I've articulated before. We have to make our
decisions now. I appreciate it. You know, as Deanna says, ask where we're
going to fund Hapuna Beach lifeguards? I don't know. I mean, these are big
challenges for us, and you know, no one likes to cut the budget. We want to go
forward. I was looking towards fixing more of our parks and getting things up
and running. Val's got a couple of parks that have been closed for years. But this
isn't going to happen this year. We're going to have to make hard decisions.
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So I don't know how you want to approach it, Chair. We're stuck. We're in a
logger jam right now. We're stuck, and I don't know how to go forward but we
have to make cuts. And I still think we should be cutting Mass Transit. I haven't
changed on that, because it's a cash flow issue. It's not a budget cut, it's a cash
flow issue. But we had that conversation. So we're going to have to be hard. I
yield.
CHR. CHUNG: Okay. Matt.
MR. KANEALI`I-KLEINFELDER: We've got a$14 million shortfall without
raising real property taxes. Sue, can you have your staff get it all out and ready,
can you have them cut all nonessential overtime? So like what Deanna said, no
grant funded, nothing that we have to do like Fire. Fire has their holiday
overtime. I don't know if that was on the list. But that cannot be in there because
we have to do that. But if it's nonessential and it's extra and it's overtime, then
we take it out, and then we come back with a real number.
I like what you're doing, you're shaving. You're not cutting but you're shaving.
If it's the $4 million figure, then we do it. And as a business owner, overtime is
big. It's time and a half. If we want to look at overtime and we don't like that
figure, then we should have thought about that years ago and hired the staff to
make not overtime. I know there's a lot of balance there, but we've got to look at
that. So can? That gives us at least the next step down. That's step one I think,
right now. And I don't know if everyone else agrees on that. Kona? If everyone
here agrees with that, but we cut as much overtime as we can out.
MR. HENRICKS: I don't agree, sorry. Before you cut all nonessential overtime,
we already asked to exclude Elections because of the fact that it's just built into
their systems when they're operating in seasonal cycles. They have to work
sometimes 16-hour days to get the job done. So when you say "all" I just want to
be clear. That's just me making a case here for what our department's needs are.
So that's just what I'm asking for.
MR. KANEALI`I-KLEINFELDER: Okay well maybe we have to figure out
what's essential and nonessential, but we've got to cut it.
CHR. CHUNG: Well, let me just say something. You know, I'm in favor of that
overtime approach, but I think there has to be some padding because we don't
know what kinds of emergencies are going to be coming up too. So there has to
be some kind of pad in there, in my opinion. I don't want to just, you know, cut it
down to its bare minimum.
MR. KANEALI`I-KLEINFELDER: So I would offer that—we said we wanted to
take an intelligent, calculated risk. I would risk that they're going to push the
union contracts back. If the Governor doesn't do that, if the State already pulled
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the $600 million to float themselves, then he's going to have to look at something
like this. So it's a calculated risk to keep moving forward with contracts that push
raises right now. That's his call. But it's a calculated risk taken by our County by
this body if we're willing to look at that. Then what Deanna said earlier, was it
$3.9 or was it$8 million that is in our current proposed Draft 3 budget that takes
into account raises that haven't been approved by the Governor yet?
MS. SAKO: Not by the Governor, by the Legislature.
MR. KANEALI`I-KLEINFELDER: By the Legislature.
MS. SAKO: But it's the raises and related fringe benefits.
MR. KANEALI`I-KLEINFELDER: And what was the number?
MS. SAKO: Roughly $8.
MR. KANEALI`I-KLEINFELDER: $8 million. I mean,just that number plus
the $6 we have in the Rainy Day Fund, takes us to the $14. So if we can slim it
down, if you can slim down with this overtime number, if we can take that
overtime and really cross out anything. If we need it, then we need it. If it's Fire,
if it's Police, but if it's just overtime that we throw out there and we budgeted in
our normal—and yeah, we want the padding, but to me, it's unnecessary. It's an
unnecessary expense. If we're going to make hard decisions, then that's a hard
decision we've got to make.
Deanna, debt services, I remember from previous conversations that we are
overpaying a little bit. More so than we needed to. Is that true or have we toned
down our debt services?
MS. SAKO: No, we do budget for what we believe we're going to issue in the
current year. So right now we were planning on issuing bonds to take out our
band sometime in the fall, but we're going to watch the bond market.
MR. KANEALI`I-KLEINFELDER: Okay.
MS. SAKO: So I mean yeah, you need to kind of leave it there because we are
already they're paying the bands or the bonds.
MR. KANEALI`I-KLEINFELDER: Okay, so we can't cut there, though. So
again, we can't budget the Rainy Day Fund, but we could bring us down to a level
where we know the Rainy Day Fund could cover a shortfall that we had, yes?
And I don't want to take it all, but that's what it's there for and we set it up that
way and it's there to protect us when we have a rainy day. And I said it was
raining earlier. It's actually pouring right now, yeah, that's where we're at.
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We're having one typhoon. So if we can get us down to about$8 million, then
that$6 million could cover us. You want some padding there, so getting us to
about$6 million, if we can cut our way back to $6 million as a shortfall, then
sorry, $4 million as a shortfall, the Rainy Day Fund can cover us leaving
$2 million in the Rainy Day Fund.
MS. SAKO: If you're asking me I'm not going to say yes or now, because I don't
agree. You know, so I disagree with that logic. I think the super typhoon is
coming the following year and I would rather leave it in place for that.
MR. KANEALI`I-KLEINFELDER: What funding do we have—are there other
accounts that we can draw from if it closed down and it all goes to
MS. SAKO: That's it.
MR. KANEALI`I-KLEINFELDER: That's it? So we'd be left looking at—
MS.
tMS. SAKO: Zero.
MR. KANEALI`I-KLEINFELDER: And we're not—there's three states so far
that have pulled funding as a loan: Rhode Island, Massachusetts, and Hawaii.
That was interesting. So can we get an opinion from Corp Counsel if we can pull
a loan? I mean if we're unwilling—if we're scared to raise taxes but we don't
know if we can pull a loan or not, then I think it's in our interest to know if we
can or cannot.
MS. SAKO: Well I think the emergency note is you can borrow $2.925 million.
MR. KANEALI`I-KLEINFELDER: So about$3 million?
MS. SAKO: It doesn't say you can use it to balance the budget. It says you can
borrow it if there's no excess appropriations.
MR. KANEALI`I-KLEINFELDER: And can we meet those qualifications?
MS. SAKO: I don't think you can use it to balance the budget was my comment.
MR. KANEALI`I-KLEINFELDER: What can it cover that's in front of us that
would help? If it's not helpful I'm going to throw it off the table and I won't talk
about it anymore. If it's helpful then we use it.
MS. SAKO: This is talking about emergency appropriations. But I think that's
when the budget is in place already unless I'm misreading something. And that's
why Joe's here.
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MR. KANEALI`I-KLEINFELDER: So Joe, we were talking about earlier that
the State pulled a $600 million loan to float them through these trying times that
we're all dealing with. Is that an option for our County, and we're looking at
what's in front of you. What section of the Code is that or our Charter?
(Note: At this time, Corporation Counsel Joseph Kamelamela came
forward to address the members of the Council.)
MR. KAMELAMELA: It's 10-8, but I'll tell you what I know so far about the
possibility of loan to kind of bail us out. I just have to tell you that it's a little bit
harder for the County because a lot of the CARES Act money was like it went to
cities 500,000 and more. And so places like Honolulu, you know, they have
certain things that we don't have. That's just a fact of life. Now, looking at that,
that means I've got to go back and see one, if there's anything else that we can
grab our hands on dealing with capital improvement projects, and then we can use
that money to help out in some other areas.
I'm going to need some time to study this section, so I really don't want to say
much about this one yet, because I mean, there is one emergency, and the Council
might make emergency appropriations, so I can read that, right? The question is
whether this allows us to do it now or do it later. So I would study this a little
more so maybe in 10 or 15 minutes when I read it.
MR. KANEALI`I-KLEINFELDER: Yes,please.
CHR. CHUNG: We can take a short recess.
MS. LEE LOY: Chair?
CHR. CHUNG: Yeah, go ahead.
MR. KANEALI`I-KLEINFELDER: Thank you, Joe.
MS. LEE LOY: Should I go get staff on trimming ?
CHR. CHUNG: Well, that's really up to you. I mean, I would actually think if
Matt wants that done his staff should do it and come up with something and you
guys can
MR. KANEALI`I-KLEINFELDER: I would like to have my staff do it, but both
of them are on Families First CARES Act leave and teleworking because they
both have small children.
CHR. CHUNG: Well, you guys have to work together on this thing. I mean, you
know, you cannot just direct her staff to
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MR. KANEALI`I-KLEINFELDER: I cannot. That's why I said "if your staff
can do that and that's something you can do." I mean, you put it out there
already. So I'm just saying we work with what you've done and we start working
down that line. Or else we're going to be here all night.
MS. LEE LOY: And I'm hoping Legislative Auditor's Office, Donna is listening
in. But I'm also going to need some help from Finance identifying the funds.
Yeah, thank you, Chair.
MR. RICHARDS: Chair, can I ask one quick question?
CHR. CHUNG: Yeah.
MR. RICHARDS: Deanna, what is your estimation on nonpayment of real
property tax for fiscal 20-21.
MS. SAKO: We always have five percent built in, like a floating five percent.
But this year we added eight percent additional. Our staff felt it should be ten, but
we already took the risk and put it at eight percent knowing that we had the Rainy
Day Fund.
MR. RICHARDS: Okay, so—alright. And Chair, I know you want to break real
quick so I'll let that sit and we can come back and talk story later. Okay, thank
you, Chair. I yield.
CHR. CHUNG: Ashley.
MS. EOFF: Mr. Chair?
CHR. CHUNG: Oh, Karen. Go ahead.
MS. EOFF: Hi. Thank you. Before we took a break for lunch, we were
discussing Ms. Lee Loy's amendment, and it seemed like we had gotten to a point
where Ms. Sako was explaining that were certain line items in there that we
should probably not have included. And I was wondering, you know, knowing
that Ms. Lee Loy's officeI don't know if you've already done this or not—but
if you were to go through—and I think Ms. Sako was kind of okay with some of
it. Like maybe not as much as your original communication, but could it be
amended at this point to take out what was inappropriate and then see where
we're at, what that number would be? I don't know how hard that is, or if
Deanna's still looking it over, but I thought you said, Deanna, that it was about—
it
boutit was about at least$2 million you saw that was not appropriate.
MS. SAKO: So I have theoh, maybe I marked it on the wrong one. But yes, I
have the State ones marked.
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MS. EOFF: I mean if we were to re-look at this idea but taking out the things that
just don't sit well or cannot be there and we could see what that amounts to, then
maybe we could look at the second proposal, Communication 774.24 and see how
much we get from there.
I'm just pretty positive we're not going to reach a$14 million number but if we
can come up or come, you know, down somehow, somewhere, then maybe we
can at least adjust the rate also down to not be so onerous. I mean, maybe it
doesn't make a whole big difference. Maybe it won't amount to enough to make
a difference. You know, I'm sorry. I don't have any better ideas either, to offer.
So I'm just thinking we were sort of on a track with these ideas, but maybe not
exactly how they're put forward, but by some slight changing. Is that still
possible?
CHR. CHUNG: Do you want me to answer?
MS. SAKO: I'm marking what I thought we discussed. I had marked all the
grants and there's a couple based on Mr. Kaneali`i-Kleinfelder's comments that
I'm marking differently.
CHR. CHUNG: Joe, by the way, what section are you looking at?
MR. KAMELAMELA: This is the Hawaii County Charter, Section 10-8. So
there's a process that is set out to use emergency funds. I think I have to go back
to my office to kind of look at something that might apply to this. So it's going to
take me a little bit more.
CHR. CHUNG: And what about—notwithstanding the emergency aspects of this
thing, what capabilities does the County have in just borrowing money? I know
we float bonds for capital improvement projects, okay, that's separate. What
about just borrowing money. Are we able to do that?
MR. KAMELAMELA: I haven't known of that really happening, because what
some places have done is just file bankruptcy because not enough money. But I
don't think we're there yet, you know. I mean, we're far from that, because we
just have this—well, it's a big gap, but you know, so we're far.
But I haven't heard anything like that before, but that's why I needed to go back
to my office. Because there's something that I recall reading that might be
applicable to this.
CHR. CHUNG: Emergency aspect?
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Hawaii County Council-43 June 4,2020
MR. KAMELAMELA: Yeah. It's just that. Because here it also says that there's
a possibility of doing an emergency note. So that's kind of curious as to what
does that mean.
CHR. CHUNG: And then another thing that came up wasI think I know what
the answer is, but what's the possibility of, or what would it take to suspend the
PONC fund.
MR. KAMELAMELA: Okay.
CHR. CHUNG: With the idea that we pay it back interest free. Would it require
an emergency declaration?
MR. KAMELAMELA: I was faced with this issue, something similar, about
maybe two months ago. So just hear me out certain things. We don't know that
the Governor and the Mayor has authority during an emergency to suspend laws.
But laws is defined as being ordinances, statutes, other rules and procedures that
the particular entity operated under. It excludes ordinances and charter.
CHR. CHUNG: Charter provisions and Constitution.
MR. KAMELAMELA: And Constitution. So during this pandemic I asked
similar types of questions, what is the capability of suspending certain parts of the
Charter, and it's been, "No, cannot."
CHR. CHUNG: How much money are we talking about in that PONC fund?
MS. SAKO: There's about$7 million that's going in there this year.
MR. KAMELAMELA: And then a similar issue came up with respect to can our
County Council under certain situations put out some kind of ordinance dealing
with emergency situations. We're only limited to what we have, and for certain
kinds of things, it's not enough for you guys to do certain things. For example,
you couldn't suspend having meetings. It's just not going to happen because it's
not in the Charter. So issues like that have come up.
MS. SAKO: So there's $7.4 million between PONC and PONC Maintenance.
CHR. CHUNG: I was just kind of curious. Ms. Lee Loy.
MS. LEE LOY: Thank you, Chair. Because I just have a follow-up to that.
Deanna, when we start addressing the need to raise in that second-tier category,
some more money going to go that PONC fund, right?
MS. SAKO: Yes. That was taken into account when we did our rates.
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MS. LEE LOY: And there's no way to suspend that amount until a later date?
MS. SAKO: Until such time that the Charter is changed.
MS. LEE LOY: Okay. Thanks, Chair, for allowing me to follow up.
MR. KAMELAMELA: So I could go back and do a little bit more research on
something that I saw and see if that would help.
CHR. CHUNG: And what would you be looking for specifically?
MR. KAMELAMELA: Trying to see if there's a mechanism that we could go
through based on what I see in that Charter Section 10-8.
CHR. CHUNG: And we'd be able to incorporate it into this budget today? No,
right?
MR. KAMELAMELA: I don't know that answer yet.
CHR. CHUNG: Deanna, what?
MS. SAKO: The section that it's in is talking about after the budget's approved
making an emergency appropriation. So I think it's after you have an approved
budget already. So that's just my take on reading it.
MR. KAMELAMELA: I mean, I read it like that too, but—
CHR.
utCHR. CHUNG: So no sense even wasting time. Ashley, sorry.
MS. KIERKIEWICZ: Thank you, Chair. Deanna, under CARES Act, there's a
significant amount of funds coming through, that$80 million, and I'm just
wondering how much of that do you think our nonprofits will be eligible to
access? To continue work like say Food Basket, Neighborhood Place of Puna,
maybe Habitat for Humanity.
MS. SAKO: I think it depends on the activities to which their doing it. So there's
different categories of spending, and I'm not sure that everyone that every task
being accomplished by the nonprofits is going to be something that we could
reimburse them for or pay them for. That's not to say that there won't be money
going to them, it just depends on the service or the activity that they're
performing.
So one of the things is, you know, there's some confusion on whether food is
covered for example, but the delivery of food is covered. So you know, we're
still analyzing some of that. So there's those types of things. But yet we know
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Hawaii County Council-43 June 4,2020
that anything related to COVID, whether it's even like maybe additional mental
health services or something like that, that is covered. So I think a lot of it will
end up going to the nonprofits, it just may not be for things they're currently or
expecting.
MS. KIERKIEWICZ: Okay, and you know, where I'm going with this is, you
know, everybody talks about shared sacrifices. You were gracious enough to
allow us to increase our contingency, but with that, we also have $2.5 million to
give away for nonprofit grant-in-aide, and so I think it's worth considering scaling
that back to $1 million. And that's not something that's within our kuleana
because it is ordinance. And considering all the additional funding that's coming
through from CARES, it's an opportunity to provide the nonprofits with
information ahead of time on and maybe they can make some pivots within their
operations.
So that's one potential cut of$1.5 million from the budget. I just question a lot of
this timing of things coming forward. I appreciate the creativity, but at the end of
the day, you're the expert here. You and your team have spent a ton of time
pouring over this, and frankly I'm ready to just accept the budget and start
figuring out how the heck we're going to tighten our belts for the upcoming fiscal
year. I think that's a more prudent use of everyone's time, to really dedicate all of
our brainpower to how we're going to make the really big cuts. Because right
now, we're really talking pennies compared to what we are really going to have to
be bracing ourselves for in the next, I don't know, maybe one to five fiscal years.
So I asked you earlier with the overtime, you felt none of it could be cut. Hearing
this dialog kind of play out, is there anything you think, any amount you think we
are able to cut?
MS. SAKO: No, I mean, when I mentioned that, you know, yeah, we could
probably live with the $1.5 million. I think it's something we can try and live
with. But you know, we have Police outside. Both Police and Fire's collective
bargaining unit have specific overtime provisions. You know, one is court on day
off. You know, if the officer doesn't appear, I'm pretty sure a lot of those people
are going to walk. So you know, there's a lot of give and take in the whole
budget, you know, there's a lot of give and take in the whole budget and they do a
lot of work and they get to that point. You know,we want to see it through. And
yeah, the Chief's outside and he can probably explain it a lot better than I can.
MS. KIERKIEWICZ: Okay. I mean if anybody wants to invite him in, he can
answer the questions. Great. But I think I just want to work with that number. I
think your staff is working with Sue's team to kind of make those adjustment, and
then let's just move forward because we really have a lot of hard work ahead of us
in the years ahead.
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CHR. CHUNG: Matt?
MR. KANEALI`I-KLEINFELDER: It was a great idea. It would be balanced by
how much money we have coming forward from CARES to pull out of NGAA
[sic]. Unfortunate, but that's the shared sacrifice. I like that idea. I would go
though, take one step back and say we had all year to think about it. And yet here
we are and this is where we're at. So we didn't get there this year, and we had
some hiccups, but this is why we sit down. This is part of our job, and this is
what we're doing. So we do need to figure this out.
Lisa, is that you in the back? It is, yeah? Lisa, I've got a question for you.
(Note: At this time, Real Property Tax Administrator Lisa Miura came
forward to address the members of the Committee.)
MR. KANEALI`I-KLEINFELDER: Your RPT tax sale cost and yes, Account
Number 5125.40, that one, June 30, 2019, it was appropriated for $1 million, and
we expended $554,000, about$500,000. Is that because something else was
coming, or just we're over.
MS. MIURA: Well that amount is actually completely offset by the revenues. So
it's not really a revolving fund, but we charge back the tax sale fees in the cost of
the sale. So when somebody buys a tax sale property the fees are in there and it
goes back into a County account. So no matter what the number is on there, how
much we spent, the money actually comes back in. So if we budget$1 million,
and we spend it, we get back that same amount. So I don't know if that makes
sense.
MR. KANEALI`I-KLEINFELDER: Okay, so there's extra in there we can pull,
like $500,000.
MS. MIURA: But then you've got to lower the revenue account by the same
amount. Those have to match.
MR. KANEALI`I-KLEINFELDER: Okay. Okay, thank you.
CHR. CHUNG: Anyone else? You know, why don't we take a short recess.
Maybe we can have some time to confer individually with Finance people. We
have three of them here. Corp. Counsel. And then you know, we might I don't
know, maybe we've got to work this backwards. I mean the original way we just
go with the tax rates already. Set the tax rate and let the chips fall as they may. I
don't know how everybody feels about that. Do you guys want to weigh in on
that? I mean, Ashley sort of implied that maybe we should just move ahead,
unless I misread what you said.
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Hawaii County Council-43 June 4,2020
You know, I don't know. I've got to credit Ms. Lee Loy for really trying to pare
that thing down because you know, I want to share a story. I got a call during
lunch time from a friend of mine, a very close friend. Local person, not rich, but
she did work for the Nature Conservancy. She just changed jobs. And she was
talking, and this person didn't call her because of this, but—and it's been brought
up before. This person was talking to her about this situation that we're going
through. Very rich person obviously, right? Living in Mauna Kea Beach
properties. This person donates $50,000 a year to the Nature Conservancy, Big
Island Chapter, and that's for reef protection.
You know, and that's what we're worried about. We're nailing a lot of these guys.
But you know, the fact of the matter is, a lot of them really contribute a lot to our
community, our local community, and for really, really important things. So I just
wanted to share that. You know, I didn't realize the magnitude. I had to ask her
again, I said, "$50,000 what, to the national Nature Conservancy?" She no, Big
Island. I'm sure that person is, you know,just one of many people. So, you
know, we don't want to really nail these guys.
So as much as possible, you know, we're trying to find ways to pare this thing
down as much as possible, but if the will of this Council is because we're in an
emergency situation right now let's move ahead, then maybe that's what we
should do. We heard some speakers yesterday who said we should engage these
landowners and pick their brains. And at that time, I spoke for all of you and said,
"Okay, let's do it." You know, they can come in any time. We're open to that.
So maybe now is the time to engage them. I don't know if they're really going to
come in, but—
What
utWhat is the pleasure of this body? Do you guys want to start with the rates and
then go back to the Operating Budget, or just keep on hammering away at the
Operating Budget with the possibility that we may be able to whittle this thing
down somewhat incrementally? Let's just I want to hear what you guys have to
say. Because if the will of this body is to just go ahead with the proposed rate,
then let's just do it already.
MS. POINDEXTER: Can I say something?
CHR. CHUNG: Yeah, go ahead.
MS. POINDEXTER: I'm not willing to go ahead withI want to cut some of
that rates down.
CHR. CHUNG: Okay.
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Hawaii County Council-43 June 4,2020
MS. POINDEXTER: I think we owe it to the people. And like you said earlier,
you know, we've got to take a risk sometimes. And if we fall short, then we've
got to figure out what we're going to do next, right?
CHR. CHUNG: Okay.
MS. POINDEXTER: That's just life. But we cannot say, "Hey, we're going to
do it now, maybe next year we'll lower the rates." Because that ain't going to
happen.
CHR. CHUNG: Okay, so at least I mean, I know where you're coming from,
and Matt seems to be of like mind. We don't know exactly where this thing is
going to land. But Ashley stated her point. I think, you know, yeah, two of them.
MS. DAVID: Chair Chung?
CHR. CHUNG: Yeah, Maile.
MS. DAVID: Yeah, I think for me I'd rather—I concur with Council Member
Poindexter. I think we have to make some sort of effort on our side just to at least
whittle it down some. So that's my mana`o.
CHR. CHUNG: Okay. Then let's take a short, maybe 20-minute break and we
can talk stories. Maybe Matt can talk with Sue, and see if they can, you know,
see if they can enlist the support of staff, and kind of do some things. Let's just
take a short break. Okay, thanks.
Recess: At 3:05 p.m., the Chair called for a recess.
Reconvene: The meeting was reconvened at 5:32 p.m.
CHR. CHUNG: Okay, we're finally out of recess on the longest 20-minute recess
in recorded history. I really do apologize, but staff, I have to give a lot of credit to
the staff. They were cranking out a lot of paperwork, and a lot of kudos to them.
Thank you.
Who's going to lead off? Should we deal with the rate first, do you think?
MR. HENRICKS: Right now where you at is that you are—on the floor is
amending Bill 144, Draft 3 with (Comm.) 774.22. That's where we are right now.
CHR. CHUNG: Okay, because Deanna, we were trying to find a way to reduce
the second-tier rate $1.00, right?
MS. SAKO: Yes.
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Hawaii County Council-43 June 4,2020
CHR. CHUNG: Still an increase of$2.50.
MS. SAKO: Correct.
CHR. CHUNG: But we have to balance that in the Operating Budget, and the
way that some of the Council members anyway, tried to do it is by decreasing the
anticipated delinquencies, right?
MS. SAKO: Yes.
CHR. CHUNG: Okay. Can you explain that and what needs to be done? Do we
need a formal amendment to the Operating Budget, or can we just move ahead as
is?
MS. SAKO: If you pass the rate reso with that$1.00 reduction in the tier-two rate
to $13.60, then we will adjust the delinquency rate down from eight to
7.2 (percent), and we will end up with the same real property tax revenue number,
but that will provide relief to the tier-two people.
CHR. CHUNG: So we don't need any further amendment to the Operating
Budget?
MS. SAKO: Not for that, no.
CHR. CHUNG: Okay. So we should act on the rate first?
MS. SAKO: If you want to, yes. But procedurally you can, yes.
CHR. CHUNG: Can we just table the Operating Budget, move on to the rate?
MR. HENRICKS: How's 774.22 looking? No? No bueno?
MS. VILLEGAS: Can I ask a question?
CHR. CHUNG: Yeah, go ahead, Rebecca.
MS. VILLEGAS: I guess I'm wondering, and correct me if I'm wrong, Deanna.
So if you're lowering it from eight percent to seven point—I'm sorry, I forget the
second number. Seven point what?
MS. SAKO: Seven point two. Roughly 7.2.
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MS. VILLEGAS: Okay. So is the nature this property tax delinquency line item
placed there for those that aren't able to pay their property taxes for whatever
reasons? My thought is that as we move into this next year, those that won't be
able to pay their property taxes, it will be directly related to COVID.
MS. SAKO: It will. Unfortunately for the coronavirus relief fund, it specifically
prohibits us from granting anyone money that would in exchange be turned
around and paid back to us. So our Water Department and our real property taxes
are off limits.
MS. VILLEGAS: Gotcha.
MS. SAKO: That's not to say we couldn't grant them money for another purpose.
That would then free up other dollars to pay our real property taxes.
MS. VILLEGAS: So there is then some wiggle room to drop this even further.
MS. SAKO: Considering our staff started at 10 percent, and I'm ending at 7.2,
they're already ready to hurt me. So
MS. VILLEGAS: I'm sorry to jeopardize your health and wellbeing.
MS. SAKO: Yeah. So this is giving this is in the spirit of cooperation and risk
taking.
MS. VILLEGAS: Okay, thank you. And while we were over here just to throw
some numbers out here, we were taking an estimate and looking at for a
$10 million home as an example, so the first$2 million, they're paying at the
$11.10 rate, which comes to $22,200. And for the other $8 million at the $13.60
rate, that comes to $108,800, making their total cost increase to $131,000, versus
when there was just one tier, it would have been $111,000. So it's innately, on a
$10 million home, it increases their annual property taxes by $20,000. And if we
go all the way to the $14.60, their property tax annual bill would have gone up to
$139,000. So in essence, by reducing this $1.00, from $14.60 to $13.60, there's
an $8,000 savings. Or they're not having to pay that$8,000. Am I doing the
math right?
MS. SAKO: That sounds close.
MS. VILLEGAS: Okay. Great, thank you. I just wantedI wanted to make sure
and I wanted anyone that's listening, constituents or concerned people to be able
to put an actual dollar amount on a $10 million home, the increase is $20,000,
versus $28,000 which was what the number originally presented could have been.
Thanks.
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CHR. CHUNG: Okay. So if we approve the budget as amended by
Ms. Poindexter's amendment, and then we subsequently approve the rate, you
will make the automatic adjustment to the projected delinquency, real property
delinquencies, right? And that is what we referred to, I mean, in various contexts,
as the risk, right?
MS. SAKO: Yes.
CHR. CHUNG: Because we don't know exactly where this thing is going to end
up, right?
MS. SAKO: Correct.
CHR. CHUNG: Okay, I don't know. Anybody want to talk about this, or do you
guys want to move forward already? And this was in collaboration with the
Administration, right. I mean, you know, as you said, there's some give and take
on all of this. We expressed our thoughts about at least taking some kind of risk,
and at the same time trying to reduce the tax burden on, you know, the second-tier
people. So, Ms. Lee Loy, do you have to take anything off? Withdraw anything?
MR. HENRICKS: Yeah, we're on 774.22 right now.
Withdraw Motion MS. LEE LOY: Motion to withdraw Communication 774.22.
to Amend:
MR. HENRICKS: You can just withdraw as introducer.
CHR. CHUNG: Okay. And I will say this. You know, there was some effort on
the part of Ms. Lee Loy and her staff and others to try to incorporate some
overtime in all of this. But it became too vexing a problem, you know, for the
staff people to try to plug in all those numbers. It just would have taken too long
a time for just a small benefit. We were looking maybe about a $700,000
reduction. So we just had figured just incorporate everything into the delinquency
reduction.
Okay. So we're back to the main motion as amended?
MR. HENRICKS: That is correct. Then before you move forward, this is what I
have on my record as the amendments that were approved: 774.12, 774.13, and
774.17. Those are the three amendments that I have. Just looking for some
corroboration from people that have been paying attention. Deanna's nodding her
head. So just so everybody's aware of where we're at. Draft 3 as amended with
those three communications. And then the main motion is on the floor right now.
CHR. CHUNG: Okay. So we have a motion to amend
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MR. HENRICKS: No. Actually, you have a motion
CHR. CHUNG: I mean a motion to approve
MR. HENRICKS: Right. Bill 144, Draft 3, as amended on second and final
reading.
CHR. CHUNG: Okay. Any further discussion? Mr. Richards.
MS. EOFF: Yes. Oh.
MR. RICHARDS: I will keep it short, Chair.
CHR. CHUNG: Yeah, please.
MR. RICHARDS: We've had—we've been here for nine hours and we haven't
done anything, and again I will restate the same thing I've said. Our procedure is
flawed. We haven't cut the budget and I'm very disappointed. I won't be
supporting it. Thank you.
CHR. CHUNG: Thank you. Maile, did you have something to say?
MS. DAVID: No, I think it was Karen.
CHR. CHUNG: Oh, Karen. Go ahead.
MS. EOFF: I just wanted to say well, we have been here for nine hours, and we
did what—we went through a lot of exercises and a lot of memos. And I just
wanted to thank everybody for that hard work and to the staff for preparing this
changed to the tax rate. I think we have done something. So mahalo.
CHR. CHUNG: Yeah, and I would agree with that. I've got to disagree with my
friend, Mr. Richards. You know, it seemed like at times a futile exercise, but it
really was, I think, productive in many regards and on many levels. So anyway,
we have a motion on the floor. All those in favor
MS. POINDEXTER: Can I ?
CHR. CHUNG: Oh. I'm sorry. Ms. Poindexter, go ahead.
MS. POINDEXTER: Just real quick. Yeah, I just want to say that I want to thank
the Administration as well for coming to us and working with us. And there's
compromises we had to make, and so I appreciate the good faith effort in doing
that and working in such a trying time. And that, you know, I know that Council
Member Tim Richards is not going to support this too, and earlier he stated that
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we didn't have the courage to cut the budget with the GET. But again, the GET
for me didn't touch the tax rates. So that's why I couldn't support that. But this
helps, you know, with the compromise of adjusting the tax rates. And if we all
voted "no," on this budget, we would go back to what the Mayor's budget is.
Everybody would lose, right? So why would I jeopardize that and vote "no." So
I'm going to support this because of the compromise. I appreciate all the time and
I appreciate my fellow Council members and working together as a team. Thank
you. Thank you, Chair.
CHR. CHUNG: Thank you. Anyone else?
MS. DAVID: Chair Chung?
CHR. CHUNG: Who's that? Maile, please.
MS. DAVID: Well you know, I think what Karen and Val have expressed is
shared by most of us. Because I think it really demonstrates the fact that we're
just not a rubber stamper group here. We really want to try to do everything.
And what I think is very evident and transparent is that when people suggest that
we do something, "All you have to do is this,"what we know is that it's not
across the board that easy. There's a lot of other things that have to be taken into
consideration. And I really want to thank Sue Lee Loy for spending the time and
making effort so that we could have this really, really in depth discussion on
trying to help resolve this tier-two tax.
And Deanna, Lisa folks, thank you very much for being able to compromise and
come to this, not a decision that will make everybody happy, but I really believe
it's an equitable one and one that we have no other choice but to make at this
time. So Donna and our LRB group and staff, I really, really thank you folks for
helping us get through this really tough decision making process. So that's all I
have to say. Mahalo a nui, and I yield.
CHR. CHUNG: Thank you very much, Maile. As always, you know, you always
bring us home and make the necessary recognitions to those deserving of it. You
know, we're here, I think this is democracy in action. But we're here. Let's not
forget—we're going to get criticized no matter what, but the fact of the matter is,
it was just like about five weeks ago when the Governor swiped $19 million of
what we're entitled to. We've had to deal with the fallout very quickly in this
cumbersome process that we have. I think we did a good job, actually. So we
have a motion on the floor. All those in—shall I do it by a roll call vote, please?
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Vote on Bill 144: The motion to pass Bill 144, Draft 3, as amended
Draft 4 to Draft 4, on second and final reading was carried by the
(Adopted) following roll call vote:
Ayes: Council Members David, Eoff, Kaneali`i-Kleinfelder,
Kierkiewicz, Lee Loy, Poindexter, Villegas,
and Chair Chung—8.
Noes: Council Member Richards — 1.
Absent: None.
Excused: None.
CHR. CHUNG: Thank you. Okay, let's now go on to the rates. Order of
Resolutions.
Return to Order The Chair directed the Council to return to the Order of Business.
of Business:
ORDER OF The Chair directed the Council to proceed to the next Order of Business, Order
RESOLUTIONS: of Resolutions.
Res. 658-20: DETERMINES THE REAL PROPERTY TAX RATES FOR THE COUNTY OF
HAWAII FOR THE FISCAL YEAR JULY 1, 2020 TO JUNE 30, 2021
Adds a second tier to the Residential classification with a rate of$14.60 per
$1,000 of assessed valuation, with all other classes of property rates unchanged
from the current Fiscal Year 2019-2020.
Reference: Comm. 962
Intr. by: Mr. Chung
Waived: FC
Motion to Approve: Ms. David moved to adopt Res. 658-20. Seconded by
Ms. Poindexter.
CHR. CHUNG: Ms. Lee Loy, your amendment, please.
Motion to Amend: Ms. Lee Loy moved to amend Res. 658-20 with the
contents of Comm. 962.2. Seconded by Ms. Kierkiewicz.
CHR. CHUNG: Any discussion there? Ms. Lee Loy, go ahead. Explain what
this is all about.
MS. LEE LOY: Yeah, it sets the second-tier rate that we've hammered out in
conjunction with the Administration. It is $1.00 less than what was proposed. I
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also have another amendment contained in another communication that I would
ask my colleagues to also entertain. But I would rather get through this first
communication, then discuss the second one.
CHR. CHUNG: Okay. Mr. Richards.
MR. RICHARDS: Thank you, Chair. This is affecting the tax rate, and I can't
support it. We are in the worst economic situation we've been in, in any of our
lifetimes, and the concept of raising taxes to balance our budget is unfathomable.
We didn't work hard enough on the budget to adjust it. I do appreciate the fact—
Chair,
actChair, we are friends. We'll remain friends.
CHR. CHUNG: Of course.
MR. RICHARDS: That's not the point. This is democracy at work, and I
adamantly disagree with how we've gone today. We needed to work harder on
cutting the budget. I stated previously on a different time and financial times I
would entertain the possibility if we sat down with the people that this directly
affected, and maybe detailed where the funds would go. Affordable housing was
one possibility. We all know we need that, but in this time right now, I deeply
fear the funds are not going to come forth, which is going to be putting us back
here in three to five months having some very, very hard conversations.
So I appreciate the work's been done. I appreciate the fact that we have
democracy at work. But once again, we have flawed situation and I can't support
this because we didn't work hard enough on the budget. I yield.
CHR. CHUNG: Anyone else? Again, I reiterate, $19 million swiped from us like
five weeks ago. Very, very difficult to recover. I think we did a good job under
the circumstances again.
MR. KANEALI`I-KLEINFELDER: Chair?
CHR. CHUNG: Yeah, Matt. Go ahead.
MR. KANEALI`I-KLEINFELDER: Just a quick comment, please. In some
ways, you know, I agree with you, Mr. Richards. You have businesses closing.
We haven't seen all the full effect of what's happening yet. Being from the
private sector, when you're faced with a short budget, then you make hard
decisions. You cut staff, you close, and a lot of people out there are doing that
right now across the nation.
So I can agree with you that raising taxes maybe isn't the best solution right now,
but it's going to help us get to where we need to be. But I do agree that the
budget process needs some work. And I think the County itself needs to take a
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hard look at how and where we apply funding. And that is our job. That's the
legislative body's job. And we work hand in hand with the Administration. This
isn't going to make everybody happy. But we are faced with a very hard
situation. So I just wanted to say that to Mr. Richards, because in that sense I
agree with you.
Thank you, everyone, for your time today. I really appreciate it. LRB, you know,
Finance, the Administration, the Council, everyone who worked. Just, here we
are, and here we go.
CHR. CHUNG: Okay, anyone else? You know, I do
MS. EOFF: Mr. Chair?
CHR. CHUNG: Yeah, who's that?
MS. EOFF: Karen. I just wanted to add something to what
Mr. Kaneali`i-Kleinfelder and I think some of us are actually wanting to express.
But the class that we have to raise here, this second tier on the residential over
$2 million properties, I just wanted to acknowledge, you know, we did receive
and I personally responded to just about everybody I could that I did hear from,
we understand the points that they make in their correspondence. And I just
wanted to acknowledge and thank these people for their contributions to our
community because they're very generous, very good neighbors and community
partners in so many ways. And you know, this wasn't easy. I expressed that.
This is something that we pondered over and we feel the hurt, and understand the
things that they feel. But we just couldn't raise the rates across the board either. I
mean, we have so many people here that are struggling. So to raise anyone else's
rates just would have caused, I think, a lot more hurt in our communities.
So I just wanted to acknowledge and thank the people who are going to have to
contribute a bit more now in relation to the values of their homes, and maybe their
life. I just, you know, don't want anyone to think we're just doing this without
deep thought and concern and understanding. And they may not be able to
contribute as much to some of the organizations that they have been in this case. I
hope that won't be the case for long. But if—you know, this is where we need it
now and these people are very, very generous. And I just wanted to thank
whomever is going to be contributing in a certain way that, you know, we do
appreciate it now. Thank you.
CHR. CHUNG: Okay, anyone else? You know, relating to the dire prediction
being made by Mr. Richards about, you know, us having to come back maybe in a
few months to address some of these problems. That may very well be true. But
that's when we have to really work with our Finance Department. You guys have
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to keep us abreast of what our situation is. And we have to prepare for the worse
no matter what. And I believe this Council, no matter what people may think, is
going to be up to the task as long as we're prepared for it.
Okay, so we have a motion on the floor. The motion is to approve Resolution
oh, we're still on the amendment, right? Okay. To amend Resolution 658-20
with the contents of Communication 962.2. Okay, all those in favor say "aye."
Vote on Motion The motion to amend Res. 658-20 with the contents of
to Amend: Comm. 962.2 was carried by the following voice vote:
(Approved)
Ayes: Council Members David, Eoff, Kaneali`i-Kleinfelder,
Kierkiewicz, Lee Loy, Poindexter, Villegas,
and Chair Chung—8.
Noes: Council Member Richards — 1.
Absent: None.
Excused: None.
CHR. CHUNG: Let's go back to the main motion now. Resolution 658-20 as
amended.
MS. LEE LOY: Chair?
CHR. CHUNG: Ms. Lee Loy, go ahead.
MR. HENRICKS: Before you do, I'm sorry. The rules would call for a holdover
at this point since it's not the actual budget. So rule suspension.
Vote on Motion to Ms. Lee Loy moved to suspend Council Rule 24 to waive
Suspend Rules: the holdover for substantive amendment of Res. 658-20.
(Approved) Seconded by Ms. Poindexter and carried by the following
voice vote:
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
Motion to Amend: Ms. Lee Loy moved to amend Res. 658-20 with the
contents of Comm. 962.1. Seconded by Ms. Kierkiewicz.
CHR. CHUNG: Do you want to read in the amendment?
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MS. LEE LOY: You can.
CHR. CHUNG: Okay. "Resolution 658-20 is amended by adding a new BE IT
FURTHER RESOLVED clause as the third such clause to read as follows: BE IT
FURTHER RESOLVED that the Director of Finance,"' Deanna, "`is requested to
work with the Council to establish a special fund for community benefits derived
from real property tax revenue collected from parcels in the Residential Tier Two
property class in the fiscal year beginning July 1, 2021."
Of course this is not a mandate, but I think the message is clear as to what Ms.
Lee Loy—and I know she did this in conjunction with Mr. Richards, too. I know
he had some input in all of this too, because it is the desire of some of us to have
this additional amount devoted to specific uses that would greatly benefit the
County.
But anyway, having said that, anyone want to comment on this? There being no
comments, we have a motion on the floor. All those in favor say "aye."
Vote on Motion The motion to amend Res. 658-20 with the contents
to Amend: of Comm. 962.1 was carried by the following voice vote:
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung–9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried. So now we are back
MR. HENRICKS: And on the safe side, another rule suspension would be in
order.
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Vote on Motion to Ms. Lee Loy moved to suspend Council Rule 24 to waive
Suspend Rules: the holdover for substantive amendment of Res. 658-20.
(Approved) Seconded by Ms. Poindexter and carried by the following
voice vote:
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: Motion carried.
MR. HENRICKS: For the record, that was to allow for further discussion and
vote on 658 as amended once again. So now you're back to the main motion as
amended twice.
CHR. CHUNG: Right. Okay, so we are back to the main motion.
Resolution 658-20, as amended. Any further discussion? There being none, shall
we do it by a roll call vote?
Vote on Res. 658-20: The motion to adopt Res. 658-20, as amended to Draft 2,
Draft 2 was carried by the following roll call vote:
(Adopted)
Ayes: Council Members David, Eoff, Kaneali`i-Kleinfelder,
Kierkiewicz, Lee Loy, Poindexter, Villegas,
and Chair Chung—8.
Noes: Council Member Richards — 1.
Absent: None.
Excused: None.
ANNOUNCE- The Chair directed the Council to proceed to the next order of business,
MENTS: Announcements.
(There were none.)
ADJOURNMENT: There being no further business, at 6:02 p.m., Ms. Lee Loy moved to adjourn the
meeting. Seconded by Ms. Poindexter and carried by the following voice vote:
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Hawai`i County Council-43 June 4, 2020
Ayes: Council Members David, Eoff,
Kaneali`i-Kleinfelder, Kierkiewicz,
Lee Loy, Poindexter, Richards, Villegas,
and Chair Chung—9.
Noes: None.
Absent: None.
Excused: None.
CHR. CHUNG: This meeting is adjourned.
Approved: SEP 1 6 2020 CPKK
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