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HomeMy WebLinkAboutMIN GOEAC 2024/09/04 (2022-2024)Committee on Governmental Operations and External Affairs 38th Session Hawaii County Building 25 Aupuni Street Hilo, Hawaii September 4, 2024 CALL TO The regular meeting of the Committee on Governmental Operations and ORDER: External Affairs was called to order at 9:30 a.m., in the Council Chambers, Hilo, by Ms. Susan L. K. Lee Loy, Acting Chair. ROLL CALL: Present: Ms. Susan L. K. Lee Loy, Acting Chair Ms. Cindy Evans, Chair (via videoconference from Kona) Ms. Jenn Kagiwada, Member Mr. Holeka Goro Inaba, Member Mr. Matt Kdneali'i-Kleinfelder, Member Ms. Ashley L. Kierkiewicz, Member Ms. Heather L. Kimball,Member Ms. Rebecca Villegas, Member Absent & Excused: Ms. Michelle M. Galimba, Member STATEMENTS The Acting Chair directed the Committee to proceed to the next order of FROM THE business, Statements from the Public on Agenda Items. PUBLIC ON AGENDA ITEMS: (There were none.) ACTING CHR. LEE LOY: Seeing no objections from my colleagues, I'll just go from the top of the agenda. Alrighty, Mr. Clerk, Communication 10.9. COMMUNI- The Acting Chair directed the Committee to proceed to the next order of business, CATIONS: Communications. Comm. 10.9: HAWAPI STATE ASSOCIATION OF COUNTIES'(HSAC) MAY 20 AND JUNE 13, 2024, EXECUTIVE COMMITTEE MEETING MINUTES AND OFFICER'S REPORTS From Council Member Heather Kimball, dated August 7, 2024. GOEAC-38 September 4, 2024 Motion to Close File: Ms. Kimball moved to close file on Comm. 10.9. Seconded by Mr. Kaneali`i-Kleinfelder. ACTING CHR. LEE LOY: Ms. Kimball, this is your communication. Please lead our discussion. MS. KIMBALL: Yes, the reporting on minutes from the State Association Executive Meetings. Happy to take any questions from the body on those reports. MS. EVANS: Chair. ACTING CHR. LEE LOY: Go ahead, Ms. Evans. MS. EVANS: Thank you. Wondered, was there any lengthy discussion about the Hazard Pay settlement? Other than just a .report, was there any discussion amongst the members? MS. KIMBALL: No, there was not a discussion on that matter in the Executive Meeting. MS. EVANS: Okay, alright, thank you. ACTING CHR. LEE LOY: Thank you, Ms. Evans. Ms. Kagiwada. MS. KAGIWADA: Thank you, Chair. This is a tiny bit off topic. But just wondering for the public. We started talking about priorities for HSAC. I'm just wondering if I can ask Council Member Kimball just to let the public know when that might be coming back before us so that the public will know. ACTING CHR. LEE LOY: Go ahead, Ms. Kimball. MS. KIMBALL: Yes, so there'll be a resolution at the next Committee meeting that will list bills and priorities that were submitted on behalf of this body. We'll then have the opportunity to amend it before final decision making in Council on October 2"d. It does have to move through, but as for right now, the anticipation is that it will be available for the next Committee meeting. MS. KAGIWADA: Thank you, and thank you, Chair for the leeway. I yield. ACTING CHR. LEE LOY: Sure, thank you. Anyone else? Alrighty, seeing no further comments, we have a motion to close file on Communication 10.9. All those in favor, please signify by saying "aye." Page 2 GOEAC-3 8 Vote on Comm. 10.9: Filed September 4, 2024 The motion to close file on Comm. 10.9 was carried by the following voice vote: Ayes: Committee Members Evans, Inaba, Kagiwada, Kdneali` i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Acting Chair Lee Loy — 8. Noes: None. Absent: Committee Member Galimba — 1. Excused: None. ACTING CHR. LEE LOY: Alrighty, on to Communication 1010, please. Comm. 1010: NOMINATION OF NATHAN GADDIS TO THE BANYAN DRIVE HAWAI`I REDEVELOPMENT AGENCY From Mayor Mitchell D. Roth, dated August 14, 2024, requesting the Council's review and confirmation. Vote on. Comm. 1010: Ms. Kimball moved to recommend confirmation of the (Approved) nomination of Mr. Nathan Gaddis to the Banyan Drive Hawaii Redevelopment Agency. Seconded by Ms. Kierkiewicz and carried by the following voice vote: Ayes: Committee Members Evans, Inaba, Kagiwada, Kdneali`i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Acting Chair Lee Loy — 8. Noes: None. Absent: Committee Member Galimba — 1. Excused: None. Executive Assistant to the Mayor Pomaika`i Bartolome came forward and provided a brief narrative of the nominee's background and experience. Committee Members spoke in favor of the appointment. ACTING CHR. LEE LOY: Mr. Clerk, Order of Resolutions, please. ORDER OF The Acting Chair directed the Council to proceed to the next order of business, RESOLUTIONS: Order of Resolutions. Res. 591-24: AMENDS THE RULES OF PROCEDURE AND ORGANIZATION OF THE COUNCIL OF THE COUNTY OF HAWAI`I BY AMENDING RULE NO. 26, RELATING TO TRANSFER OF COUNTY COUNCIL DISTRICT CONTINGENCY RELIEF FUNDS Reference: Comm.990 Intr. by: Mr. Inaba Page 3 GOEAC-38 Motion to Approve September 4, 2024 Mr. Inaba moved to recommend adoption of Res. 591-24. Seconded by Mr. Kdneali'i-Klelnfelder. ACTING CHR. LEE LOY: Mr. Inaba. MR. INABA: Thank you, Chair. This resolution is pretty straightforward. We did the bill for our nonprofit grants in Code, and this is a follow-up to make sure that our Rule 26 (c) aligns with that. And it's pretty clear as to how the funds are transferred and that we are making sure that all of those funds benefit directly the public through an agency of the County or an eligible nonprofit. Ask for my colleagues' support. Mahalo. ACTING CHR. LEE LOY: Perfect. Any questions, thoughts, inputs? Seeing none, thank you, Mr. Inaba, for just always smoothing out the knots that we have in various policy work. We have a motion to forward Resolution 591-24 to the Council with a favorable recommendation. All those in favor, please say "aye." Vote on Res. 591-24: The motion to recommend adoption of Res. 591-24 was (Approved) carried by the following voice vote: Ayes: Committee Members Evans, Inaba, Kagiwada, Kdneali'i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Acting Chair Lee Loy — 8. Noes: None. Absent: Committee Member Galimba — 1. Excused: None. ACTING CHR. LEE LOY: Alrighty, Mr. Clerk, Resolution 592-24, please. Res. 592-24: AUTHORIZES THE MAYOR TO ENTER INTO AN AGREEMENT WITH THE STATE OF HAWAI'l DEPARTMENT OF TAXATION Authorizes the Mayor to enter into a memorandum of agreement to share confidential tax return information relating to the administration of the State and County of Hawai'i's Transient Accommodations Tax. Reference: Comm. 992 Intr. by: Ms. Evans (B/R) Motion to Approve: Ms. Kimball moved to recommend adoption of Res. 592-24. Seconded by Ms. Kagiwada. Page 4 GOEAC-3 8 September 4, 2024 ACTING CHR. LEE LOY: I'll handle it here. MS. KIMBALL: Chair, I'd like to invite Deputy Finance Director Mr. Brown to come join us. My main question is just a point of curiosity, as to which way the data sharing is going. Or it's not clear in the resolution, if we are sharing information with the State or vice versa, or both? (Note: At this time, Finance Deputy Director Aaron Brown, came forward to address the members of the Committee.) MR. BROWN: Aloha, good morning, Aaron Brown, Finance. I have our TAT (Transient Accommodation Tax) expert with us. This is Wilson Crider here. And great question. I'm going to have our expert elaborate more on that. Basically, the resolution is an agreement with the State. A lot of the data we get to help process our TAT comes from the State. So, it's a sharing of information. You know, this is the only taxes that we collect on our own. A lot of the taxes we usually get is collected on the State level and then passed down to us in certain ways. But this one is a new program that we administer ourselves. And so, the information that we get from them is very important, and I think I'll let Wilson, maybe speak a little bit more to the details on that. He is our expert, so thanks Wilson. (Note: At this time, TAT Internal Controls Manager Wilson Crider, came forward to address the members of the Committee.) MR. CRIDER: Good morning. Yes, as far as the MOU (Memorandum of Understanding) goes, it's like Aaron says, the State provides the State filing information to us which we use to create our tax bills. There is a clause in the MOU that says that the State can request information back from us. The only thing they would really be asking would be payment information so that they can do their compliance work to see whether or not, you know, taxpayers are paying the County and not paying the State. But there hasn't been that request yet. So, really, it's just a one-way communication at this time, but there is that option for them later on to ask. MS. KIMBALL: So, we're primarily using the collection information from the State to ensure that we have County level compliance in terms of payment on the County level TAT. And that information is shared exclusively with the Finance Department or is that —you can probably imagine where my question is going based on other items that we are deliberating. Page 5 GOEAC-38 September 4, 2024 Are we doing any cross-checking with RPT (Real Property Tax) or others to ensure that there are other components of the TAT and Transient Accommodation Rentals, for example, that are being appropriately taxed and covered? MR. CRIDER: Yes, we're working with RPT. So, we use that contact information and make sure that we're sending bills to the right people. And also, with Planning as far as the permitting process. And I think there's a new ordinance that you guys are in the process of approving; then you're going to pass it to come to us to get a certification. And so, yeah, we have that communication to tell them what delinquent accounts there are, so they're not renewing permits. MR. BROWN: Great question. Just want to add to that, that I think that was a topic that we continue to discuss all the time, is the internal discussion, on how do we, you know, take the data and how do we share that with the proper places. MOU (Memorandum of Understanding). Especially, with the divisions within Finance to make sure, you know, some of the things you're talking about are being addressed. Wilson's done a real good job of making sure that, even when they do the reconciliation within the TAT to make sure we have enough information to reach out to these taxpayers. I think it is a little confusing because taxpayers who are subject to the TAT have to pay both the State and the County. And a lot of times they're not aware that they also have to pay a separate County TAT. So, it's been a lot of education; it's been a lot of reaching out, and just making sure that our taxpayers are aware. And then also getting the data from the State to make sure we can reconcile properly, and you know, everything is working out on that end. MS. KIMBALL: Great. And then one final question. Given the data sets that you have and how they're formulated, would you be able to provide us with a report of the amount of TAT being contributed by Transient Accommodation Rentals and that distribution across the island? MR. CRIDER: Not really. It's kind of hard based off of the information we get. The State, what they provide us is the taxpayer I.D. (Identification); their name, and then pretty much, just their revenue. And so, based off of that revenue, we calculate the three percent. Then we have contact information, which is again, just their mailing address. And so, we don't know which property is generating the revenue per say. But we're working with, like I said, with RPT as based off of that taxpayer name to try and figure out where that property is. So, we have limited information at this point. Page 6 GOEAC-38 September 4, 2024 But we're hoping once Planning gets more information from those listing agencies, and they have where that property is located. We can take that information and merge it with our information. Then we can give a better idea where that revenue is coming from. MS. KIMBALL: Okay. Going to be "Ms. Snarky" here, but boy, it seems like we should have a registration process. Thank you, I yield, Chair. ACTING CHR. LEE LOY: Thank you, Ms. Kimball. Mr. Kdneali`i-Kleinfelder. MR. KANEALI`I-KLEINFELDER: Thank you for being here today. Just reading the last statement on the B-52. "This MOU is necessary for the County to effectively administer it's HCTAT (Hawai`i County Transient Accommodation Tax)." We've been doing this for how long now? Collecting the MR. CRIDER: A couple years. We started in January 2022. MR. KANEALI`I-KLEINFELDER: Okay, would you say that we're doing it well right now? Because the substantive source of income used to be locked in at $19.5 million from the State. This is now a revenue source for the County that's substantial. So, has it gone well from 2022 until now, or are we thinking we're not doing it well? Because I'm just looking at that last statement from the B-52. MR. CRIDER: Yes, it's definitely a lot better than when we first started. And I can say from experience that we're doing it better than any other county in Hawaii. So, we're ahead of the game as far as everybody else. In fact, we developed the software that everybody else is using currently in the other counties. Oahu audited a software package that they're using, but they've been only able to use it from that point -in -time that they purchased it until now. All their historical information, they haven't been able to go back to figure out what's been paid and what's not been paid. Whereas, we have all that information and able to generate statements and do collections. So, I think we're much further ahead of the game than everybody else. MR. KANEALI`I-KLEINFELDER: Okay, well done. MR. BROWN: To add to that, Wilson actually helped develop the database program that we're using right now. And he's flown to many of the other counties to help them kind of further develop their internal processes and how to track and reach out to a lot of the taxpayers. So, we are pretty proud that we are humbly ahead of some of the other counties, I think, in the TAT processing. Page 7 GOEAC-38 September 4, 2024 MR. KANEALI'l-KLEINFELDER: That's a big statement. Well done, Sir. Thank you. So, one more time then. This allows us, this MOU provides information from the State to the County so we can kind of reconcile where we stand with people who are saying they're paying their taxes versus who is. MR. CRIDER: It's actually our primary source of information of the revenue that people are reporting. In fact, right now, it's the only source. Because until, again, we get that ordinance from the Planning Department that they get that revenue information from those listing agencies. I guess that's why we call them, you know, the VRBO's (Vacation Rental by Owner), Vacasa (Vacation rental management company). If we could get the revenue information from them as well, then we can compare those two to see, you know, is there any reconciliation that needs to happen or any underreporting or what have you. MR. KANEALI'l-KLEINFELDER: Okay, I got you, that makes sense. Thank you very much and thank you for your work. I yield, Chair. ACTING CHR. LEE LOY: Thank you, Mr. Kdneali'i-Kleinfelder. Anyone else? Checking over at Kona. Cindy, Ms. Evans? MS. EVANS: No questions. Thank you, Chair. ACTING CHR. LEE LOY: Great. I too, am very grateful Wilson for all your good work. I was able to attend a conference where a lot of our Real Property Tax collectors were at, and they talked a lot about software and programs. So, you guys are doing great, but you guys could do better with new software and programs and maybe in the future budget, there's some opportunities there. Go ahead. MR. CRIDER: We're actually in the process of a contract with Tyler Hawaii to actually upgrade our software. So, it's actually not going to cost us anything. We're using the SPO (State Procurement Office). MR. BROWN: Yes, we've got the State Procurement System, so yeah. MR. CRIDER: So, yeah, we're working through them for that. So, we're going to transition off of my home -built system for, you know, a more professionally built system. ACTING CHR. LEE LOY: Great. Thank you so much. And I like the opportunities that we have where we can leverage all the counties with software programs that help everybody do their job better. Mr. Brown. MR. BROWN: So, the new ERP (Enterprise Resource Planning) or Connect System as we've branded it is going to have a module that we're really hoping — Page 8 GOEAC-38 September 4, 2024 it's being developed right now. We're in the Planning and Data generation phase, but we're hoping it will help our TAT team over there with a lot of the tracking and data. ACTING CHR. LEE LOY: I love it when you guys are saying that we're in front of everybody else. Members, we have a motion on the floor to forward Resolution 592-24 to Council with a favorable recommendation. All those in favor, please say "aye." Vote on Res. 592-24: The motion to recommend adoption of Res. 592-24 was (Approved) carried by the following voice vote: Ayes: Committee Members Evans, Inaba, Kagiwada, Kaneali`i-Kleinfelder, Kierkiewicz, Kimball, Vi.11egas, and Acting Chair Lee Loy — 8. Noes: None. Absent: Committee Member Galimba — 1. Excused: None. ADJOURN- Seeing no further business, Acting Chair Lee Loy adjourned the meeting at MENT: 10:13 a.m. Approved: g11612- �4 Ms. , air (Date) Committee on Governmental Operations and External Affairs CE/dt Page 9