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HomeMy WebLinkAboutMIN FC 2021/04/06 2020-2022 Committee on Finance 7th Session Hawaii County Building 25 Aupuni Street Hilo, Hawaii April 6, 2021 CALL TO The regular meeting of the Committee on Finance was called to order at ORDER: 1:00 p.m. in the Council Chambers, Hilo, by Mr. Matt Kaneali`i- Kleinfelder, Chair. ROLL CALL: Present: Mr. Matt Kaneali`i- Kleinfelder, Chair Ms. Heather L. Kimball, Vice Chair Mr. Aaron S. Y. Chung, Member Ms. Maile Medeiros David, Member Mr. Holeka Goro Inaba, Member Ms. Ashley L. Kierkiewicz, Member Ms. Susan L. K. Lee Loy, Member Mr. Herbert M. "Tim" Richards III, Member Ms. Rebecca Villegas, Member STATEMENTS The Chair directed the Committee to proceed to the next order of business, FROM THE Statements from the Public on Agenda Items. PUBLIC ON AGENDA ITEMS: (There were none.) COMMUNI- The Chair directed the Committee to proceed to the next order of business, CATIONS: Communications. Comm. 30.6: REPORT OF FUND TRANSFERS AUTHORIZED: FEBRARY 16 —28, 2021 From Controller Kay Oshiro, dated March 5, 2021. Motion to Close File: Mr. Inaba moved to close file on Comm. 30.6. Seconded by Mr. Richards. CHR KANEALI`I-KLEINFELDER: Is there any discussion from the Council? Okay. Deanna, I have a question about one of the Public Works' requests to transfer. (Note: At this time Finance Director Deanna Sako came forward to address the members of the Committee.) FC-7 April 6,2021 CHR KANEALI`I-KLEINFELDER: Thank you for joining us. It looks like there's the Bridge Inspection, OCE (Other Current Expenses) Miscellaneous Contract Services lower than anticipated costs enough so to cover the anticipated cost for a new half-ton truck? MS. SAKO: I believe they budgeted for the half-ton truck but they didn't have enough. A lot of the vehicles, due to the material shortages nationwide, have been coming in higher than expected. In addition, then the shipping with the Young Brothers surcharge is also driving this costs up. CHR KANEALI`I-KLEINFELDER: Wow. Okay. MS. SAKO: I'm just saying that because you'll probably be seeing many of types of transfers in the months to come. CHR KANEALI`I-KLEINFELDER: I did, yes. Okay. And then the Do-It Yourself Used Motor Oil Program. That's the next one. That's from DEM, Environmental Management. Is it an ongoing program? MS. SAKO: I believe it is. And sometimes we get federal money for it, sometimes we don't. I believe this one is County funded, yes. CHR KANEALI`I-KLEINFELDER: Okay. And then the next one. What is CILV? It's the Parks and Rec. transfer. MS. SAKO: Cash in Lieu Vacation. CHR KANEALI`I-KLEINFELDER: Okay. MS. SAKO: So if someone let's say retires or leaves the County, then we'll payout any unused vacation. That's one of the County benefits. CHR KANEALI`I-KLEINFELDER: Got it. Thank you, ma'am. Okay. I see no other discussion from the Council. We have the motion to close file on Communication 30.6 on the floor. All in favor of closing file on Communication 30.6? Vote on Comm. 30.6: The motion to close file on Comm. 30.6 was carried Filed by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Page 2 FC-7 April 6,2021 Excused: None. Comm. 30.7: REPORT OF FUNDS TRANSFERS AUTHORIZED: MARCH 1 — 15, 2021 From Controller Kay Oshiro, dated March 16, 2021. Motion to Close File: Mr. Inaba moved to close file on Comm. 30.7. Seconded by Ms. Villegas. CHR KANEALI`I-KLEINFELDER: Any questions, Council? Ms. Kierkiewicz, go ahead. MS. KIERKIEWICZ: Thank you, Chair. Deanna, quick question, please. Thank you. The Committee Chair touched on this a bit earlier, the transfers within Public Works. This one, you know, kind of raises eyebrows a little bit. Building, $200,000 moving from Electricity to Equipment, Motor Vehicles, pretty significant. And like you said, we're going to be seeing more of these as we end the budget cycle. Is there a requirement by your department for each of the County departments to have an asset list, equipment list, so that we can understand and track the condition of all of our County assets? MS. SAKO: So we do have and it's transmitted to Council each August, a list of all the County equipment. And then we do kind of maintain a list of mileage. Some have low mileage and can still be in awful shape, you know, they may have just been one of those lemons we got in the very beginning or they can have very high mileage and still work. So we really go based off Automotive. And when they say it's still in good condition or if it's safe or unsafe. Then if it's unsafe, we'll take it off the road. MS. KIERKIEWICZ: Can you remind me what that communication would be titled, the asset list? MS. SAKO: I think it's the fixed asset inventory. And it is like about a foot high, yeah. MS. KIERKIEWICZ: Okay. Perfect. MS. SAKO: Yeah. MS. KIERKIEWICZ: Thank you. We can't miss it. Thanks, Deanna. Thank you, Chair. I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Kierkiewicz. Mr. Inaba, go ahead. Page 3 FC-7 April 6,2021 MR. INABA: Hi. And follow up to Ms. Kierkiewicz. When they determine that something is no longer safe or it's phased out of its lifetime, how do we go about—do we sell things or do we give things, how does it work? MS. SAKO: We primarily sell things. So it's laid out in the County Code as to what our options are. And so primarily we sell at an auction to make it fair to everyone. So a lot of times—and we're very clear that either it's a functioning vehicle or it's not. So sometimes we'll put parts only. Because some people do want to buy it for the parts. They may need it for their own vehicle at home. So those auctions happen usually in the spring, I want to say May. I forgot to ask them if they have it on the schedule already. But usually May or June, we'll do one. I think last year we have skipped because of COVID. But we're planning it to be back on schedule this year. MR. INABA: And is that your department of DPW (Department of Public Works) that leads that process? MS. SAKO: It is our department and our Property Management Division does it. MR. INABA: Okay. Thank you. Chair, I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Inaba. Yeah, the question I had regarding this communication—yeah the, I mean the one that caught me was the $200,000 in electricity costs that was over what was needed or not needed. What was theI mean, that's a fairly large MS. SAKO: They are looking into that. I think we went based off of last year's electricity usage. And then I think they did do some fixes so that the systems, some of the solar systems work better. So I don't think they needed as much in electricity anymore. CHR KANEALI`I-KLEINFELDER: That would be including our building then? MS. SAKO: Yes. CHR KANEALI`I-KLEINFELDER: Wow. That was a big difference. Okay. But they were able to find enough to MS. SAKO: To cover, yes. So some of the departments have had a hard time finding. In addition the vehicles are becoming more important because with COVID we are trying to limit the number of employees in each vehicle. So we did use some of the CARES Act for that. But then they still had a few more that they're trying to accommodate. Page 4 FC-7 April 6,2021 CHR KANEALI`I-KLEINFELDER: Yeah. I think Ashely raised a good question, you know, I mean we see requests for new vehicles all the time but without knowing what the need is, it's hard to say, yes or no, with certainty. MS. SAKO: Right. So we do have a committee that reviews that before they're purchased so that we do know like either they're end of life, how high the mileage is, or just if it's needed sometimes we'll say, "Hey, can you get by with a used one?" Especially right now with the dollar amounts being so high, then we have been doing more used. Not like, you know, ten year old vehicles but slightly used vehicles, where the price has come down significantly even if they're one year old. CHR KANEALI`I-KLEINFELDER: Good, good. So doing some cost saving where we can, the main thing. MS. SAKO: Yup. CHR KANEALI`I-KLEINFELDER: Okay, good. Thank you, Deanna. Okay, no further question? Okay, we have the motion on the floor to close file on Communication 30.7. All in favor. Vote on Comm. 30.7: The motion to close file on Comm. 30.7 was carried Filed by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. CHR KANEALI`I-KLEINFELDER: Next communication. Comm. 31.8: REPORT OF CHANGE ORDERS AUTHORIZED: FEBRUARY 16 —28, 2021 From Finance Director Deanna Sako, dated March 2, 2021,transmitting the above report pursuant to Hawaii County Charter Section 2-12.3. Motion to Close File: Mr. Inaba moved to close file on Comm. 31.8. Seconded by Ms. David. CHR KANEALI`I-KLEINFELDER: Council, any discussion? I see Heather Kimball's light's on. MS. KIMBALL: Yes. Thank you. I just wanted some clarification, Director Sako, on the two lease extensions for the emergency shelter. Pretty significant amounts, Page 5 FC-7 April 6,2021 where those funds are coming from and how long is the lease extended for, and do we expect a third extension at some point? MS. SAKO: So I believe, based on the timing of these, these are the two that we extended so they would cover our March, April, and May for the shelters to be used for isolation facilities. And this particular time period, Department of Health is reimbursing us for that. Previously, we did use some CARES Act for that. The end of May, those leases will expire. We're still waiting for Department of Health to clarify what the need might be going forward. You know, I thing one of the criteria is looking at, you know, how many people have been vaccinated and where our accounts are at. But in addition, I believe the Hilo Seaside has been sold and is under new ownership and that one probably will not be extended. MS. KIMBALL: Thank you so much, Director. I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Kimball. Mr. Richards, go ahead. MR. RICHARDS: Yeah. Thank you, Chair. Deanna, looking through this change order, we have an original contract, a bunch of these is zero. And then the change is zero, so it's easy to balance a budget if we're not spending anything. But can you explain that and specifically on the third from the bottom, "PTA to provide testing staffing and results for COVID-19 at the airports". Looks like that's a historical thing because it looks past tense, but again no dollars are assigned to that. And I know that was rather expensive, so can you explain that please? MS. SAKO: So any of these, our PTA is our Price Term Agreements. So we'll go out for a bid for a per item type of thing because sometimes we don't know how many we're going to use. It might be one, it might be 100,000. It's hard to say. So this was one of those where we did a price term agreement and we worked it out a price per test. And so they were doing the airport testing and we did use CARES money. And this particular contract, I would have to go back and look. But yes, it was a significant amount that we spent on it. MR. RICHARDS: But under the purpose it ends December 2020. MS. SAKO: Yeah, the vendor was a little slow in returning that back to us. MR. RICHARDS: Okay, so it is previous then? MS. SAKO: It's done, yeah. MR. RICHARDS: Alright. I'd like that number as far as what we were spending on the testing. Page 6 FC-7 April 6,2021 MS. SAKO: Yeah, I have it. I think the newspaper has inquired about that. I just didn't bring it with me. Sorry. MR. RICHARDS: Okay. Alright. Maybe if you could get it and communicate it to the Council, please? MS. SAKO: Yes. MR. RICHARDS: Thanks, Chair. I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Richards. Good question. Mr. Inaba. MR. INABA: Deanna, for a follow up to Council Member Kimball's questions on the hotel. This lease, is it for a specific number of rooms we're just paying for or is it by need that we pay? MS. SAKO: It's a block of rooms that they could segregate from the rest of the facilities so to keep anyone else safe that might be there. And so, we pay for it whether we use it or not. But again, this is fully reimbursed by the Department of Health. MR. INABA: And are we allowed to know how many rooms we're receiving at these hotels? MS. SAKO: You know, I can picture the counts but I'm not sure if it's the number of rooms or—I'll just say it's roughly like 50 at each site. So we can isolate several people whether they're coming in from the mainland, you know, and they test positive at the airport. Or whether it's just our own local families that, you know, some families have more people in their homes than others so it's hard to actually segregate your family members from others. So they've been utilized for all types of situations. MR. INABA: And sorry, since you mentioned that, if they do test positive at the airport and they already had hotel arrangements, we're still putting them up in these hotels? MS. SAKO: It depends. I think some hotels are accepting, some are not. I'm not quite up to speed with currently the situation. But if you're—or if you're arriving back home, we'll let you isolate there. I don't know that we're forcing them to go there. But we are trying to make sure everyone has a place that they can isolate and stay safe. MR. INABA: Sorry, I know you're not Civil Defense. But thanks for the answers. Page 7 FC-7 April 6,2021 MS. SAKO: No, no. I'm trying to share whatever I do remember. But yes. MR. INABA: Okay. Thank you, Chair. I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Inaba. Deanna, good questions raised by the Council. For the emergency shelters, does that go through an RFP (Request for Proposals) like most of the expenses from the CARES Act funds? MS. SAKO: We did look at various vendors. And that was not an easy one, to find someone who was willing to lease space. CHR KANEALI`I-KLEINFELDER: Okay. So yes or no? MS. SAKO: It was not an actual RFP. But we did go out and try to get bids. CHR KANEALI`I-KLEINFELDER: Okay. So how was a vendor selected? MS. SAKO: They were the only large vendor that was willing to rent us rooms, yes. CHR KANEALI`I-KLEINFELDER: Okay. Beautiful. You know, I appreciate you catching as many questions as you get and having answers for them because you just hit about 10 different areas of our County and you had good answers for all of them. Thank you, Deanna. Okay, motion is on the floor to close file on Communication 31.8. All in favor? Vote on Comm. 31.8: The motion to close file on Comm. 31.8 was carried Filed by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Brown. Can we go to our next resolution? I believe we haveI see people outside. I cannot tell who's out there. But I think let's go to Resolution 76-21. ORDER OF The Chair directed the Committee to proceed to the next order of business, RESOLUTIONS: Order of Resolutions. Page 8 FC-7 April 6,2021 Res. 76-21: AUTHORIZES THE ACCEPTANCE OF A DONATION OF A WATER POLO LANE LINE COURSE TO THE COUNTY OF HAWAII DEPARTMENT OF PARKS AND RECREATION The donation, provided by the USA Women's Water Polo Team, is valued at approximately $5,500 and would be used at the Kona Community Aquatic Center in Kailua-Kona. Reference: Comm. 179 Intr. by: Mr. Kaneali`i-Kleinfelder (B/R) Motion to Approve: Mr. Inaba moved to recommend adoption of Res. 76-21. Seconded by Ms. Kierkiewicz. CHR KANEALII-KLEINFELDER: Council Members, any discussion? MS. KIERKIEWICZ: Chair, maybe we can invite forward Parks and Recreation to talk about why this donation from this particular group. CHR KANEALII-KLEINFELDER: Yup. Whoever would like to come forward, please come? Ashley, go ahead. (Note: At this time, Deputy Director Michelle Hiraishi and Aquatics Specialist Alejandra Flores-Morikami came forward to address the members of the Committee.) MS. KIERKIEWICZ: Hi, Alex. Great to see you. Aloha, Deputy. Great to see you. How exciting, this donation. Can you just talk about how this came through, connection to our County and how they're going to be utilizing this space? Because I know they wanted to do some public outreach clinic for youth in the community. CHR KANEALII-KLEINFELDER: If you could, for the record,please tell us who you are and who you're with? MS. HIRAISHL Michelle Hiraishi, Deputy Director, Parks and Recreation. MS. FLORES-MORIKAML Alejandra Flores-Morikami. I'm the Aquatics Specialist with P & R. CHR KANEALII-KLEINFELDER: Thank you. MS. HIRAISHL Go ahead, Alex. MS. FLORES-MORIKAML Yeah. So the United States Women's Water Polo Team reached out to us. They wanted to do a training trip here on island. And Page 9 FC-7 April 6,2021 since we don't have the lane lines required for a water polo, they call it a field, they shipped on over and it was, you know, their intent to leave it on island so that we can further youth programming for the sport on island. And that's our intent. MS. KIERKIEWICZ: Awesome. Thank you. Chair, I yield. CHR KANEALI`I-KLEINFELDER: Thank you. Ms. Villegas, go ahead. MS. VILLEGAS: Yeah. I just want to thank you for that incredible work. My daughter played water polo at the facility there in Kona and it was always a struggle to get the right equipment. So I also know just what a positive impact it was for so many having them here in—when they were in Kona and working with some of our youth there. So thank you for facilitating that, especially with the extraordinary circumstances of the coronavirus and what that meant. But I just heard fantastic things about you work with the community there and the youth wanting to be able to witness that kind of greatness in the water polo world. And then also to facilitate an incredible resource like this to continue to be available. Thank you, appreciate it. MS. HIRAISHL And I do need to add that it was Alex and her team and the work that they did with the water polo team that came over, that really I guess solidified this donation. It was such a good relationship that she built that they wanted to make sure they left a gift. And that worked perfect for us. MS. VILLEGAS: Thank you for that. That's huge. MS. FLORES-MORIKAML It's really my pleasure. Thank you guys. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Villegas. Anyone else? Nope. I appreciate you coming today and thank you for helping to get this done. So we don't have any water polo equipment or lane designators or course material, I mean, on island? MS. FLORES-MORIKAML This is our first as far as our inventory. Yes, we don't have a water polo program run by P&R yet. BIIF (Big Island Interscholastic Federation) does CHR KANEALI`I-KLEINFELDER: I like the "yet." That was good. MS. FLORES-MORIKAML Yes. I'm a huge fan of this sport. And that's been one of our goals, is to get a youth program going. In the past it's only been, you know, ball handling and, you know, throwing it around here and there. But this really sets us up to be able help encourage youth to play actual games. Page 10 FC-7 April 6,2021 CHR KANEALII-KLEINFELDER: Okay. Well thank you for helping to coordinate this. And I think we should mahalo to the USA Water Polo folks, and mahalo them, if they're watching. But thank you for doing what you do and for being here today. Okay, no further discussion. All in favor of forwarding Resolution 76-21 to Council with a favorable recommendation say "aye." Vote on Res. 76-21: The motion to recommend adoption of Res. 76-21 was (Approved) carried by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder–9. Noes: None. Absent: None. Excused: None. CHR KANEALII-KLEINFELDER: Okay, Clerk, let's do Resolution 77-21. I think we have Susan Kunz here ready for any discussion we may have. Res. 77-21: ADOPTS THE 2021 COUNTY OF HAWAII ACTION PLAN FOR THE COUNTY OF HAWAII COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM, HOME INVESTMENT PARTNERSHIPS PROGRAM, AND HOUSING TRUST FUNDS PROGRAM AND AUTHORIZES THE MAYOR OF THE COUNTY OF HAWAII TO EXECUTE AND SUBMIT THE ACTION PLAN AND ALL OTHER RELATED DOCUMENTS TO THE UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AND STATE OF HAWAII HOUSING FINANCE AND DEVELOPMENT CORPORATION The 2021 County of Hawaii Action Plan describes the projects and activities that will be executed by the County to provide decent housing, suitable and safe living environments, and accessibility for disabled individuals to public facilities using the County's share of Community Development Block Grant program funds. Reference: Comm. 180 Intr. by: Mr. Matt Kaneali`i-Kleinfelder B/R Motion to Approve: Mr. Inaba moved to recommend adoption of Res. 77-21. Seconded by Ms. Villegas. CHR KANEALII-KLEINFELDER: Susan, if you want to come up. We had a brief discussion today as part of our Housing Agency. But we are back in Council to approve the resolution. If you just—maybe start us off and kind of breakdown those kind of nice solid data points you had this morning. Page 11 FC-7 April 6,2021 (Note: At this time, Housing Administrator Susan Kunz came forward to address the members of the Committee.) MS. KUNZ: Okay. CHR KANEALI`I-KLEINFELDER: And then we'll see if there's any further discussion from the Council. MS. KUNZ: Good afternoon, everyone. I am Susan Kunz with the Office of Housing and Community Development(CDBG). Today I would like to present to you this annual action plan with a list of projects that we are recommending for approval. The resolution and ordinance that go together is authorizing the Mayor to enter into an agreement with HUD (Housing and Urban Development). The ordinance sets up the accounts for us to spend the money. So by federal mandates we are required to put together a five-year consolidated plan. The current five year plan covers the period from 2020 to 2024. So this annual action plan represents the second year of activities in this five-year plan and it outlines the projects that we're going to be doing this year. So the three federal grants that are represented here are the CDBG (Community Development Block Grant), Home Investment Partnership, and the Hawaii Trust Fund. In the CDBG program we are recommending four projects. So it's the Ulu Wini Low Income Housing, Wastewater Treatment Plant Repairs, for $1,420,889;the Ulu Wini Low Income Housing Certified Kitchen Project, for $495,500; Hale Ohana Domestic Abuse Shelter Interior and Exterior renovations, for $225,760; and the West Hawaii Domestic Abuse Shelter Interior and Exterior renovations, for $157,225. We are also going to be utilizing $500,000 for administrative activities for a total of$2.6 million. The HOME Investment Partnership Program has three projects: the HOME Tenant-Based Rental Assistance Program, for $1,960,200; Habitat for Humanity, Affordable Homes for Puna families, this is for $450,000; and University Heights Home reconstruction, for $289,800. For the Housing Trust Fund there are two projects: West Kawili Street Senior Veteran Housing project, for $2.3 million; and University Heights Home reconstruction, for $400,000. So I want to share that, you know, we go through a very rigorous RFP (Request for Proposals)process. We take applications, usually at the end of the year, award them in the early part of the year. And you know, we are vetting projects for their ability, if they're shovel ready, and based on the ranking and rating sheets that are public documents the team is ranking and rating these projects. You know, one of the biggest criteria for the grants is the ability for the projects Page 12 FC-7 April 6,2021 to spend down the money. HUD does not like us to be sitting on it. So for example, CDBG requires us to not have more than 1.5 percent of the award amount for that year in the coffers at the end of the year. The HOME and Housing Trust Fund (HTF), I believe they give us about four years to spend down the project monies from the time we receive the monies from the state. So expenditure and readiness is really high priority for these projects. If you have any questions I'd be happy to answer any questions you might have. CHR KANEALI`I-KLEINFELDER: Okay. Thank you for your presentation. And then any Council Members, please feel free to ask any questions that you may have of the Director. Heather, you want to start us off? MS. KIMBALL: Thank you. I just have one follow up question from earlier. Can you breakdown those administrative costs? I mean, I know it's allowable at 20 percent of the total give, but it does seem very high at 18 percent. What are we covering with the administrative costs? MS. KUNZ: We are covering overhead and staffing charges basically. MS. KIMBALL: You have—are these part-time hires, full-time? MS. KUNZ: They're all full-time workers. MS. KIMBALL: Okay. MS. KUNZ: So there are Housing Specialists that are responsible to, you know, rank and rate, do the contracts, monitor the contracts, audits; and I do have administrative staff that also help with the accounting portion of the activities as well. MS. KIMBALL: So three staff people? MS. KUNZ: You know, I can't remember exactly the full-time. I will make sure to get that information for you. But it's two full-time staff and portions of administrative staff. So I don't know exactly the full-time equivalent. MS. KIMBALL: Okay. Thank you, Director. I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Kimball. Ms. Kierkiewicz, go ahead. MS. KIERKIEWICZ: Thank you, Chair. Susan, you mentioned this earlier when we met as Housing Agency, our non-legislative function of this body. Can you Page 13 FC-7 April 6,2021 remind me what one or two streams of funding here are provided to our County every three years? You said it rotating between Kaua`i and Maui. MS. KUNZ: Yes, yes. So the HOME and the HTF programs are every three years. MS. KIERKIEWICZ: Okay. And you know, what's great is I believe last term, this body had approved a 201H application for one of the projects that is getting the HTF Funds, that is the Senior Veteran's Housing project next to University of Hawai`i at Hilo on Kawili Street. So it's great that this funding is able to help them get to the next step and really make the project whole. MS. KUNZ: Exactly. MS. KIERKIEWICZ: So thank you and your team for your diligent work on this fund. Chair, I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Kierkiewicz. Anyone else? Mr. Inaba, go ahead. MR. INABA: I think I'm still not clear on the administrative costs that Ms. Kimball asked about. So if we already have people who are full-time and they're on our payroll, where is this money going exactly? Is that what you spoke about, 18 percent administrative costs? MS. KUNZ: I'm not sure I understand. MR. INABA: My understanding is that some of this funds that we're getting is going towards administrative costs. MS. KUNZ: Yes. MR. INABA: Up to 18 percent. But we have these people on payroll already. So what exactly is this 18 percent of the funds going to? MS. KUNZ: So they are going to be utilized to fund the payroll for these staff and overhead costs. So because my office is 96 percent federally funded, it's very important for me to have a cost-sharing methodology that I audited on, right? So I have to make sure that I'm showing how each one of the federal grant programs that I manage are paying its fair share of our overhead. So it's not just paying for staffing, but it's paying for rent, electricity, water. I mean it's paying for portions of administrative staff, it's paying for supplies, materials, yeah. MR. INABA: Okay. Page 14 FC-7 April 6,2021 MS. KUNZ: And so HUD allows us to take up to 20 percent of the total allocation every year for administrative costs and this year's allocation, we are taking about 18.5 percent. Yeah. MR. INABA: Okay. Thank you. Chair, I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Inaba. Any further questions? Okay. Susan, I appreciate our conversation earlier. MS. KUNZ: Yes. No problem. CHR KANEALI`I-KLEINFELDER: It'd be nice for you to, you know, discuss some of the—you know, what are things, because now you have the public, the public can watch and anyone to watching. So what's going on, you know, across the districts, you know, what kind of projects do you see coming up that are needed, that people should know about if they're watching? MS. KUNZ: You know, we're the Office of Housing. So all the projects that I see coming to the table are related to housing projects for the most part. You know, I tell you that every year when we go out to RFP for these grants—like for example, one of the questions what was being asked earlier, you know, what is the need? So for example, with CDBG, I mean we approved five projects but we had 13 applications come in. We get an allocation of$2.5 million on the average every year and the request was for $9 million. So it pretty much looks like that on an annual basis, where the need far exceeds what we get. But the projects that are coming in are usually housing related in some manner. And I wish I had more CDBG Funds to distribute, really. CHR KANEALI`I-KLEINFELDER: And then some of the other things you talked about, kind of incentives for homeowners to provide 208 Housing, or the voucher program, what we discussed this morning MS. KUNZ: So the short supply of housing units, affordable housing units is something that we're all very aware of. You know, I have to say that affordable housing is probably the number one goal for me. To support and to help develop affordable housing. It drives and supports everything that I do in the Housing office. You know, when there's a short supply of affordable housing, I struggle with homelessness. When there's a short supply of affordable housing, I struggle to spend my Section 8 money. So development of affordable housing has to drive everything that I do. And it does. CHR KANEALI`I-KLEINFELDER: Okay. MS. KUNZ: And it does. Page 15 FC-7 April 6,2021 CHR KANEALII-KLEINFELDER: Okay. Thank you, appreciate your time, again. MS. KUNZ: Okay. Thank you. CHR KANEALII-KLEINFELDER: Okay. No further questions from the Council. We have the motion on the floor to forward Resolution 77-21 to Council with a favorable recommendation. All in favor. Vote on Res. 77-21: The motion to recommend adoption of Res. 77-21 was (Approved) carried by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. CHR KANEALII-KLEINFELDER: And if we could because the Director is here, can we go right to Bill 29? BILLS FOR The Chair directed the Committee to proceed to the next order of business, ORDINANCES: Bills for Ordinances. Change Order As directed by the Chair and with no objection from the Committee Members, of Business: the following item was taken out of order: Bill : 29 AMEND ORDINANCE NO. 20-45, AS AMENDED, THE OPERATING BUDGET FOR THE COUNTY OF HAWAII FOR THE FISCAL YEAR ENDING JUNE 30, 2021 Appropriates revenues in the Federal—Block Grant account($2,699,374) and the Block Grant—Program Income account($100,000); and appropriates the same to the following accounts: Ulu Wini Low Income Housing Wastewater Treatment Plant—Repairs ($1,420,889); Ulu Wini Low Income Housing Certified Kitchen— Conversion ($495,500); Hale Ohana Domestic Abuse Shelter—Interior & Exterior Renovations ($225,760); West Hawai`i Domestic Abuse Shelter—Interior & Exterior Renovations ($157,225); and Administration, Planning & Fair Housing ($500,000). Reference: Comm. 180 Intr. by: Mr. Kaneali`i-Kleinfelder (B/R) Page 16 FC-7 April 6,2021 Vote on Bill 29: Mr. Inaba moved to recommend passage of Bill 29 on first (Approved) reading. Seconded by Ms. Villegas and carried by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. Return to Order The Chair directed the Committee to return to the order of business. of Business: Bill 28: AMENDS CHAPTER 19, ARTICLE 1, SECTION 19-2 AND REPEALS CHAPTER 19, ARTICLE 13, OF THE HAWAII COUNTY CODE 1983 (2016 EDITION, AS AMENDED), RELATING TO REAL PROPERTY SOLAR WATER HEATER TAX CREDIT Repeals Article 13 of the Hawaii County Code, which established the Solar Water Heater Tax Credit. Reference: Comm. 173 Intr. by: Mr. Chung Motion to Approve: Mr. Chung moved to recommend passage of Bill 28 on first reading. Seconded by Ms. David. CHR KANEALII-KLEINFELDER: Mr. Chung, how about you lead this discussion as this is your bill. MR. CHUNG: You know, not unlike the non-spec residential program, this bill was really something that was recommended by the Real Property Tax Working Group. And in deference to that group I brought this forward for the sake of discussion and, you know, I actually support it. But also not unlike that other bill, this could be viewed as a work in progress, you know. There are some public policy issues that attach to this that we need to discuss. And I anticipate that this would be held in Committee. That would be my recommendation anyway, because we've received some very good comments from the public. Well, I have anyway. And I've touched base with the Department of Finance and time really isn't of the essence on this one. But let me give you what the underpinnings of this are. Basically, you know, we currently have a solar water heating tax credit. One time only, $300. It really is arguable when I read the ordinance, it's debatable as to whether this tax credit applies to all installations of solar water heating equipment Page 17 FC-7 April 6,2021 or only retrofits to existing. But I believe the way it's been applied by the County for all of these years is that it's for all, whether retrofit or for new construction. So I'm going to go on that assumption. Now as it relates to new construction, there really is no reason to have this tax credit because it is intended to be an incentive for people to, you know, have solar water heating panels and equipment, because it's just more energy efficient. It's better. We want to encourage people to do this. But for new construction it makes no sense. There's no incentive because it's required already. So we don't need that. It's basically we're giving $300 away when guys are required to do that. I don't see any other law either State or County that allows for something that does that. What becomes more interesting though is what kind of effect this has on preexisting buildings? And I would like to have a little bit more time to discuss this with the Finance Department. Maybe, you know,they can come. Lisa Miura from Real Property Tax and Keita are here. But I don't think we have all of the information. We have to also engage Public Works I think on this one. Because if there are annually a large amount of preexisting homes that are opting into this type of equipment, then we want to make it available to these preexisting homes. We want to continue that. But there should be no reason for a tax credit to exist for new construction. And so that's where I'm at. And you know, I have received calls from people in the industry, you know, we're all on the same page. We all know what we want to do. We all know what the public purpose here is. It's just a matter of tweaking things so that we come up with a good product. You know, we're not trying to ram anything down people's throats or anything like that. We want to advance a good solid public policy. So that's where I'm at. So I invite any comments. We're not going to move this out of Committee today. That would be my thought. And my further thought is that we will keep this open for preexisting properties so that people can now convert to this type of equipment, this kind of technology. And that's all. That's all I have to say. Any thoughts? CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Chung. Mr. Inaba, go ahead. MR. INABA: Question. Can somebody from Real Property Tax explain your folk's mana`o on this bill? And I might have a couple questions. But just to get us started. CHR KANEALI`I-KLEINFELDER: I believe we have Lisa in Kona and Keita is here in Hilo. And if you can answer Mr. Inaba's questions please? Page 18 FC-7 April 6,2021 (Note: At this time, Real Property Tax Administrator Lisa Miura and Assistant Administrator Keita Jo came forward to address the members of the Committee.) MR. INABA: Who's going to answer, Lisa or Keita? Keita, your mics working? MR. JO: Yeah, my mics working. Keita Jo, Assistant Administrator, Real Property Tax Division. This really came about from an evaluation perspective, as Council Member Chung had mentioned. The Real Property Tax Working Group came up with a recommendation to repeal the solar water heater tax credit. And it came about in a time where, back in 2018 a majority of properties receiving this credit were new construction. It was already written to the code as a requirement to have a solar water heater. And so there really wasn't that, as mentioned, incentive. So that's where this came about as far as a recommendation. Today we see about 93 parcels ask for this credit or apply for this credit. Out of that, the vast majority is actually on older construction. So we're talking about retrofitting. So I think it was again introduced to help facilitate this discussion on incentivizing and how we best incentivize through real property tax. MR. INABA: Keita, so that's 93 total parcels per year who are applying for the credit? MR. JO: Correct. MR. INABA: Okay. And how are we verifying exactly that they actually installed? MR. JO: So we'll get the permit information over from Building, and then we'll verify as it's finalized through the permitting process. MR. INABA: Okay. That's all the questions I have for now. Thank you, Chair. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Inaba. Mr. Richards, go ahead. MR. RICHARDS: Thanks, Chair. And I think I agree with Mr. Chung as far as this goes. Initially it was put in place—again, I always go back and look at history to encourage the swap over to be more energy efficient. But since it's required by law now, why do we give a tax credit for something that's required because we're making that shift anyway. So the logic behind that is pretty self-evident. Aaron brings up a good point. But what if we're converting old systems to new systems and I like that we're being Page 19 FC-7 April 6,2021 mindful of that because probably more likely it's going to be very old buildings which are probably more likely to have retirees or something in them. So I can see the advantage to keeping that in place for that. And I also agree with keeping it in committee right now as we kind of walk through and think through the process there. So we're taking care of the group that we want to, encouraging the conversion that we want to, while doing away with something that's really redundant and more importantly hurting the County. So I think the thought process is all there. I like keeping it in committee and we'll have more talk story on this. Chair, I yield. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Richards. Okay, anyone else? Ms. David, go ahead. MS. DAVID: Mahalo for being here, Mr. Jo. Question, on the new construction, do you folks have any idea revenue-wise, on the new construction, how much money would this be saving, you know, should we go forward on new construction. What's the number that we're looking at in savings? MR. JO: Sorry. If I were to take a quick stab at it. The total amount of credit that's a portion to individuals participating in this program is about$27,700. New construction, if I were to define it as six years or less, that's just really rough, that makes up about, as of now, about 30 percent of the properties that are receiving this credit. So if you just take that $27,700, divide it by three, the cost is really more or less $10,000. MS. DAVID: Okay. Alright. Thank you. Thanks for the information. I yield for now. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. David. Okay, Ms. Kimball, go ahead. MS. KIMBALL: Thank you. And thank you, Council Member Chung again, for bringing forward these issues for conversation. I concur, it does not make sense to continue a tax credit for new construction when it's already mandated. Both the need is there to maintain some sort of incentivization for conversion from either electric or propane water heaters to solar hot water heaters. My question is really more directed towards the body. And it just occurred to me, sitting here, I wonder if there is a mechanism that's more appropriate outside of the tax code to provide that incentivization. And this comes from a place of complete ignorance on where that other opportunity might lie. But I'm curious if we looked at maybe the process of giving a permit to do the installation or something like that. If there's another place that we can pull the incentivization process to outside of the tax code so that we can still keep that for remodeling and Page 20 FC-7 April 6,2021 not have to come back to this in the tax code at a later point. Just going to throw that out there for conversation. Thanks. I yield, Chair. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Kimball. That's a good idea. Ms. Lee Loy, go ahead. MS. LEE LOY: Thank you. Actually, I was along those same lines with Council Member Kimball. We're currently going through an overhaul again of all of our construction codes and the family of codes and there is triggers related to permit and inspection that would help, which is why I appreciate Council Member Chung looking to hit the pause button a little bit to engage the building division. And then other people who install and when some of this would be triggered. I think as mentioned back in 2010 it was incentivized through HRS (Hawai`i Revised Statutes), and there are variance processes also available there. And what I don't want to do is close the door on other energy efficiency needs and uses that could be utilized through the variance process through HRS that would still reach our energy goals and not foreclose that. So I do think there is small conversation that has to happen a little bit. But also maybe some areas within our Chapter 5 our administrative section of our construction codes, where some of this might be able to get fleshed out, rather than through the Real Property Tax Division. That's just my thoughts. But I yield at this time. CHR KANEALI`I-KLEINFELDER: Thank you, Ms. Lee Loy. Mr. Chung, go ahead. MR. CHUNG: Keita or Lisa, either of you can answer this? How many of the other counties have a similar tax credit. MS. MIURA: This is Lisa with the Real Property Tax. Sorry, I can hear some Council Members and I can't really hear others. But I can hear Councilman Chung. None of the other counties have a credit through Real Property Tax for solar water heating or photovoltaic. MR. CHUNG: Okay. MS. MIURA: None of the other counties in Hawaii, I should say. I'm not sure about the rest of the country. MR. CHUNG: Alright. Okay. Well what I'm going to do though, and I've looked at the title of this bill and it's broad enough to accommodate some reasonable amendments and based upon what I've heard today. So I'm going to try to see if we can preserve the tax credit for preexisting homes but eliminate it for new homes. Page 21 FC-7 April 6,2021 And you know, although Ms. Kimball and Ms. Lee Loy bring up some really good ideas, I wasn't prepared to shift my paradigms, you know, that quickly. So I'm going to just come up with an amendment and, you know, if it goes up, down, whatever. Or you guys want to come up with some different arrangement, that's absolutely fine. But that's what you guys can anticipate. So right now I'm going to—Ms. Kimball. Unless anyone else has a comment or after all of the comments are done, I'll make a motion to defer this matter to the call of the Chair. CHR KANEALI`I-KLEINFELDER: Go ahead with your motion, sir. MR. INABA: I have one more question. Sorry. CHR KANEALI`I-KLEINFELDER: Mr. Inaba, go ahead. Sorry. MR. INABA: Of the 93, how many were for new and how many were for existing? MR. JO: So out of the 93, 21 was for new construction; somewhere thereabout. MR. INABA: Okay. I'll talk to Ms.—I'll wait on this. Thank you so much. Chair, I yield. MR. JO: Okay. CHR KANEALI`I-KLEINFELDER: Thank you, Mr. Inaba. Okay, Mr. Chung. Vote on Motion Mr. Chung moved to postpone Bill 28 to the call of the to Postpone: Chair. Seconded by Ms. Lee Loy and carried by the (Approved) following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder–9. Noes: None. Absent: None. Excused: None. ADJOURN- There being no further business, at 1:50 p.m. Ms. Lee Loy moved to adjourn MENT: the meeting. Seconded by Mr. Richards and carried by the following voice vote: Ayes: Committee Members Chung, David, Inaba, Kierkiewicz, Kimball, Lee Loy, Richards, Villegas, and Chair Kaneali`i-Kleinfelder–9. Noes: None. Absent: None. Excused: None. Page 22 FC-7 April 6,2021 CHR KANEALI`I-KLEINFELDER: Thank you very much for everyone's time and attention. Approved: Mr. Matt Kaneali`i-Kleinfelder, Chair (Date) Finance Committee MK/tk Page 23