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HomeMy WebLinkAboutMIN FC 2026/07/07 (2024-2026) DRAFT Committee on Finance 39th Session Hawaii County Building 25 Aupuni Street Hilo, Hawaii 96720 July 7, 2026 CALL TO The regular meeting of the Committee on Finance was called to order at ORDER: 9:00 a.m., in the Council Chambers, Hilo, by Mr. Matt Kaneali`i-Kleinfelder, Chair. ROLL CALL: Present: Mr. Matt Kaneali`i-Kleinfelder, Chair Mr. James E. Hustace, Vice Chair Ms. Michelle M. Galimba, Member Mr. Holeka Goro Inaba, Member Ms. Jenn Kagiwada, Member Ms. Ashley L. Kierkiewicz,Member Ms. Heather Kimball, Member Mr. Dennis "Fresh" Onish , Member(came in later) 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. 23' 37,: REPORT OF FUND TRANSFERS AUTHORIZED: MAY 1 — 15, 2026 From Controller Jon Arbles, dated May 30, 2026. Motion to Approve: Mr. Hustace moved to close file on Comm. 23.37. Seconded Eby`Ms. Kagiwada. CHR. KANEALI`I-KLEINFELDER: Council Members, discussion? Council Member Hustace, go ahead. MR. HUSTACE: Thank you, Chair. This is a question for Public Works actually. (Note: At this time, Public Works Business Manager Kelsey Kalua-Lewis came forward to address the members of the Committee.) FC-39 July 7,2026 MS. KALUA-LEWIS: Good morning. Kelsey Kalua-Lewis, Public Works. MR. HUSTACE: Good morning, Ms. Kalua-Lewis. Just a question on the flood control accounts. What have been some of the past uses for this particular account? MS. KALUA-LEWIS: So our flood control account we use it to clear the flood channels, areas around the flood channels. If we have any flood control I guess smaller scale projects, historically we can use these Rinds,for that purpose. MR. HUSTACE: And you just had a little bit of a need in the water spigot maintenance then for this one. MS. KALUA-LEWIS: Yes. So the water spigot maintenance, you know, we had uncontrollable costs increase in expenditures when we looked at our budget. Flood control, usually what we do at the end of the year is we'll coo a charge back for all the work that the Highway Division does. So unfortunately, we won't be doing as much of the transfer for the charge back this year due to the water spigot cost. MR. HUSTACE: And these are just maintenance of spigots around just on our facilities across the island or are there particular areas that we're trying to get back to or rotating maintenance of? MS. KALUA-LEWIS: So the water spigots was basically due to increase in our water bills for mostly the Ocean View, Puna area sites. We kind of figured it was due to, well them were some dry conditions and also with the increase episodes outat the volcano, more people needing to use the water spigots. MR. HUSTACE: Thank you. I appreciate it. Thank you, Chair. MS.,KALUA-LEWIS: You're welcome. Can you expand,a little bit more. That's one of the big issues that came up in our community was the water spigots. MS. KALUA-LEWIS: Okay. So the water spigots, what we do is it's a coordinated effort between Water Supply, Public Works, and some other departments that we've talked with include Parks and Recreation, but we usually monitor the water spigot sites. We do the small repairs for the spigots and kind of just oversee the billing, the routine maintenance, routine repairs. As far as the charges and the reason for this transfer is for whatever reason I couldn't tie it back. Looking at trends, my assumptions of why we had such an increased amount in volume in those particular sites, which was mostly the Puna and Ocean View area, that we've just had a larger amount of community who needed to use the water spigot facilities. CHR. KANEALI`I-KLEINFELDER: Okay. Page 2 FC-39 July 7,2026 MS. KALUA-LEWIS: We did increase just looking at the trends of fiscal year 2026, we did increase the budget for our water spigots in 2027. CHR. KANEALI`I-KLEINFELDER: Okay, good. What is the budgeted amount for that line item? MS. KALUA-LEWIS: Unfortunately I don't know it off the top of my head, but we added an additional $64,000 around there, to just:kind of cover what we felt was the need or the gap in fiscal year 2026. CHR KANEALI`I-KLEINFELDER: Okay,- MS. KALUA-LEWIS: I can get that number for you though. - - CHR KANEALI`I-KLEINFELDER No, no. It's okay. I can go look. I think my underlying question is this is for maintenance and for the water itself? MS. KALUA-LEWIS: So small repairs and the heavy amount of the budget is for the utility bills. CHR KANEALI`I-KLEINFEL }ER: For water. MS. KALUA-LEWIS: For water, yeah. CHR KANEALI`I-KLEINFELDER: Okay. MS. KALUA-LEWIS: Some sites off the top of my head we can see like 26,000 gallons'.-It's,a 16t'in'those areas. CHR. KANEALI`I-KLEINFELDER: Okay. Taking it back, so I think one of the items brought to my attention by community but also by Mayor Alameda was that water spigots came tip again and again as he went around the island. So from what I'm hearing right now, you're seeing increased water utility bills, which is increased water usage. MS. KALUA-LEWIS: Yes. CR. KANEALI`I-KLEINFELDER: And albeit we had a leak somewhere. If this wasn't a leak, then we actually have more usage coming in. MS. KALUA-LEWIS: Yeah. And we have a pretty good system. So DWS (Department of Water Supply) is good. If they see something that looks like there may be a leak, they'll call us. We'll have somebody go check, confirm that there's not a leak, if there is a leak. So it basically is consumption increase. CHR KANEALI`I-KLEINFELDER: Okay. This kind of gets at my point. As we see more water usage you'll need to increase this account number and funding. Page 3 FC-39 July 7,2026 But the other part is this is due to increase build out across all of our subdivisions, our rural areas that rely on those water spigots for usage as well as a lot of water haulers now have the tanks in the back of their trucks. MS. KALUA-LEWIS: Yes. CHR. KANEALI`I-KLEINFELDER: They're not actually water haulers, but they're functioning as that for parts of the community that cannot afford the big truck. And so you're going to get a lot more usage of guys filling up the totes in the back of a dodge and then driving it to someone's house to do a 250 gallon fill. MS. KALUA-LEWIS: To do a haul, yeah. CHR KANEALI`I-KLEINFELDER: Yeah.k So somethingxo look at; something to track. MS. KALUA-LEWIS: Yeah. CHR KANEALI`I-KLEINFELDER: And then one of those things that came up on the campaign trail for Mayor Alameda as well. MS. KALUA-LEWIS: Okay: Thank you. CHR KANEALI`I-KLEINFELDER: So interested to see what you guys do; maybe more buildout and more infrastructure. MS. KALUA-LEWIS: I'll definitely take back that ideas back to the Director. CHR KANEALI`I-KLEINFELDER: Thank you. Ms. Nakagawa. (Note: At this time, Finance Director Diane Nakagawa came forward to address the members of the Committee.) MS. NAKAGAWA': Yes, thank you. Good morning, Council. Diane Nakagawa, Finance Department. I just wanted to add on this conversation that this is a very recent discussion that we've had in the administration, in fact just yesterday, on looking at the needs especially during the recent disasters and the increased recluest for water. So we are taking a look. There is, at the direction of Mayor Alameda and the Water Department, and Public Works as well, more coordination and discussion to talk about if there's additional needs, very supportive of that. As Kelsey mentioned that we did have an increase in the budget over the last year, but the look is that the trend is increasing; the need is increasing, and so we're aware and we are going to take a look at that. It is a topic of discussion that we'll take a look at. CHR KANEALI`I-KLEINFELDER: Good job. Thank you. Yeah, I mean our residents, we depend on water. Everyone needs water. We don't pipe it in to there is that we're allowing to build. And so in light of that,you have increased Page 4 FC-39 July 7,2026 usage at your water spigots, and we need to put more water spigots and more water availability to the people who live there. So thank you for identifying that, Ms. Nakagawa and Ms. Kalua-Lewis. Thank you. MS. KALUA-LEWIS: Thank you. CHR. KANEALI`I-KLEINFELDER: Mr. Hustace. MR. HUSTACE: Thanks, Chair. Just one more question on that. I appreciate the increase into the water spigot maintenance account. I just do have concerns about the flood control account because those services, those contracts we're issuing out of that account are preventative in measure right? Aro we using that account that way it's intended then in terms of mitigating some of thoflood damaging as a precursor to some storm events and so:forth? MS. KALUA-LEWIS: Yes, we do., So the Highway Maintenance Division will have a list of expenditures that theydtr for flood control projects and that's the charge back we refer back to at the end of the year. " MR. HUSTACE: Okay. I just want to make;sure we're using that account the way we hoped to for preventative measures. MS. KALUA-LEWIS: Yeah. Yes: MR. HUSTACE: Okay. Thank you. Thanks, Chair. CHR- KANEALI`I-KLEINFELDER: Thank you. Seeing no further discussion. Motion,is on the floor to close file on Communication 23.37. All in favor? Vote on Comm. 23.37., The motion to close file on Comm. 23.37 was carried by Filed the following voice vote: Ayes: Committee Members Galimba, Hustace, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. Comm. 23.38: REPORT OF FUND TRANSFERS AUTHORIZED: MAY 16 —31, 2026 From Controller Jon Arbles, dated June 15, 2026. Motion to Approve: Mr. Hustace moved to close file on Comm. 23.38. Seconded by Ms. Galimba. CHR KANEALI`I-KLEINFELDER: Discussion. Page 5 FC-39 July 7,2026 MR. HUSTACE: Chair? CHR. KANEALI`I-KLEINFELDER: Council Member Hustace, go ahead. MR. HUSTACE: Thank you, Chair. Question for Environmental Management please. (Note: At this time, Environmental Management Business Manager Robin Bauman came forward to address the members'of the Committee.) MS. BAUMAN: Good morning. Robin Bauman,'Business Manager for Environmental Management. MR. HUSTACE: Thanks, Ms. Bauman. Good to see you the morning. Just a question on the transfer of funds out of Wastewater Division for'a combined purchase of equipment totaling$964,000. If you could do a cost breakdown of that equipment here with us; is that possible? MS. BAUMAN: Yes. MR. HUSTACE: What was purchased was a pre-engineered storage building, a roll-on off truck, light towers and an excavator with a,hammer, right? MS. BAUMAN: Yes. MR. HUSTACE: So all of those transfers from the four different accounts for miscellaneous equipment. What are the cost breakdowns for those items? MS. BAUMAN: Jay. So the pre-engineered storage buildings, the estimated cost was $120,000. In the end we did not proceed with that purchase. The roll-off truck was about$350,000; the light towers, six of them totaled to $264,000. MR. HUSTACE: Sorry. Number again. Sorry. MS. BAUMAN: $264,000 total. And the excavator was $130,000. MR. HUSTACE: And so you didn't make that purchase of the storage unit though? MS. BAUMAN: Correct. We decided to hold off on that. We needed to do a little more design and planning work before we proceeded with that purchase. MR. HUSTACE: Is that not accounted for in the transfer though, the $120,000? MS. BAUMAN: Yeah, that was included in the transfer. Page 6 FC-39 July 7,2026 MR. HUSTACE: So that transfer just happened to miscellaneous and it's just sitting there, the $120,000 then for future use? MS. BAUMAN: Yeah. MR. HUSTACE: Okay. Bigger question. The light towers, these are facilities that are operating under dark conditions then? MS. BAUMAN: Yeah. These would be portable light towers for use when crews have to go out at night to do repairs, respond to emergencies to provide lighting. MR. HUSTACE: Okay. But using heavy equipment�during dark hours so light towers for that purpose for safety purposes. And then just'an overall question and maybe this is a question more for Director (Daniel) Girvan, but should these funds have been used instead of for repairs to existing facilities versus purchasing of new equipment? MS. BAUMAN: Well to some extent this will help us to repair our facilities. MR. HUSTACE: Okay. I understand because the equipment tracks with that for sure. Just out of curiosity We were talking about funding and repairs for certain facilities. I mean, Director talked,about finding some capacity to repair some facilities and so this transfer for a large amount just raises some flag for me in the sense that some of these funds should be going towards the repairs of facilities and the other costs that we have with existing facilities and what we're undertaking. So it's more of a question for the director so I apologize. MS. BAUMAN: Yeah. No. I can take that message back. MR. HUSTACE: Thank you. I appreciate that. Thanks, Ms. Bauman. Thanks, Chair. CHR. kANEALI`I-KLEINFELDER: Thank you. Anything further? Okay. To the departments, thank you for being here this morning. I know Ms. Nakagawa has asked all the departments to be available for questions from the Council and I appreciate you all coming in to answer our questions as needed. Thank you. Seeing no further discussion, motion is on the floor to close file on Communication 23.38, all in favor? Vote on Comm. 23.38: a,. The motion to close file on Comm. 23.38 was carried by Filed the following voice vote: Ayes: Committee Members Galimba, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, Villegas, and Chair Kaneali`i-Kleinfelder—8. Noes: Committee Member Hustace— 1. Absent: None. Page 7 FC-39 July 7,2026 Excused: None. Comm. 27.5: REPORT OF DONATIONS RECEIVED FROM THE DANIEL R. SAYRE MEMORIAL FOUNDATION AS OF MARCH 2O26 From Finance Director Diane Nakagawa, dated June 3, 2026, transmitting the above report pursuant to Resolution 468-20. Motion to Approve: Mr. Hustace moved to close file on Comm. 27.5. Seconded by Ms. Galimba. CHR. KANEALI`I-KLEINFELDER: Council Member Hustace, discussion? MR. HUSTACE: Thank you, Chair. I just want to mahalo the Daniel Sayre Foundation for their support. CHR KANEALI`I-KLEINFELDER Thank you. Anyone else? ,No. As Mr. Hustace said, I would like to say mahalo to the Daniel R. Sayre Foundation, particularly Laura. She is amazing ancwhat she brings into the Fire Department every year with the help of both County, State, and all of our private partners is absolutely amazing. I mean, we can buy helicopters, trucks, scubas, I mean, everything. So yeah, a big mahalo to the Sayres'. We have a motion on the floor to close file on Communication 27.5, all in favor`? Vote on Comm. 27.5: The motion to close file on Comm. 27.5 Was carried by the Filed following voice vote: Ayes: Committee Members Galimba, Hustace, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, and Chair Kaneali`i-Kleinfelder— 8. Noes: None. Absent Committee Member Villegas — 1. Excused: None. Page 8 FC-39 July 7,2026 Comm. 938: SUPPLEMENTAL SUMMARY OF BONDED INDEBTEDNESS AS OF MAY 7, 2026 From Finance Director Diane Nakagawa, dated May 19, 2026, transmitting the above pursuant to Chapter 47C of the Hawaii Revised Statutes, per the issuance of$137,903 Public Improvement Bonds Reimbursable by Improvement District 21 Iki Place Subdivision lot owners. Motion to Approve: Mr. Hustace moved to close file on Comm. 938. Seconded by Mr. Onishi. CHR. KANEALI`I-KLEINFELDER: Any discussion? Council Member Hustace. MR. HUSTACE: Thank you, Chair. I just want to mahalo Director Nakagawa for transmitting this to us for discussion. Thank you. CHR KANEALI`I-KLEINFELDER:,Council Member Kimball. MS. KIMBALL: Yeah. I'd actually, given'the numbers here, I would love for the director to kind of walk us through all of these. I am particularly interested in, you know, some of these general obligation bonds that have been issued many years ago and there's still a significant amount of principle due and just kind of understanding how that, I mean,they may all be on different kinds of payment schedules but I'd kind of like to understand particularly that aspect. But I think it would be valuable for the body to kind of just walk through the entire report. (Note: At this time, Finance Director Diane Nakagawa came forward to address the members of the Committee.) MS. NAKAGAWA': Of course. Good morning again, Council Members. Diane Nakagawa, Finance. Here with me today is Chris Nakano, our County Treasurer. The item you have in front of you is a summary of our net funded debt for the Counts. This is an HRS (Hawai`i Revised Statutes) requirement to submit this 30 days within delivery of a new issuance, and this one happens to be the Iki Place project that we did back in May. That one took a bit, but it is finally underway. 'We're looking at an NTP (Network Time Protocol) shortly. If you're wondering what the status is of that, so within 30 days of that we are required to come forward. We will come forward again shortly because it will be the end of the fiscal year on June 30t', so you will see us again, probably not much changes to this summary, very shortly. So to walk you through the documents you have in front of you. Under 1,you'll have the GO, the County General Obligation bonds you'll see at the $501 million. Then you'll have the state revolving loan funds and then the revenue bonds. So your total debt outstanding and unpaid of$561+ million. Now you have to go through for number two, the different exclusions. So one is those that are maturing that we will be paid in one and in two of revenue bonds or the CFD Page 9 FC-39 July 7,2026 (Contact for Difference), so those are paid. When they are paid by the private owners or like in Water Supply in "D", those are excluded. They are paid by other entities as well as in E in the improvement districts. With those exclusions you get the net funded debt of$534 million. The different schedules that are attached to that kind of breakdown the numbers that you see in one and two in the first page. So to your question,yes, in Schedule A, you have the date of issuance for our GO bonds, and our principle amount outstanding as of May 7, 2026. So the original principle amounts outstanding, most of these, and Chris can correct me if I'm wrong, but most of these are 20 years. The primarily wastewater,GO'thatwe did last year is a 25 year schedule. So they're all on that same schedule with payments and we're happy to break those down if you would like a separate,meeting to look at each of the schedules. But this is still the outstanding that we have on each of these issuances. For the May 25, the most recent, we have not yethad a principle payment yet. That will be upcoming. So that's why you see the full total principle amount in outstanding. One of the other things thatcomes up a lot, a question, is the percentage of debt. So with what you have in front of you; it is 8.84 percent of our general fund expenditure as issued. If it was all authorized but not issued, we're at 14.05 percent. MS:KIMBA L: Okay. Yeah. Thank you for that overview. When you calculate those percentages, can you clarify if that includes the ones that are, for example, with Department of Water Supply? S. NAKAGAWA': Those are not included. MS.KIMBALL: Those are not included. Okay. That's all the questions I have. Thank You, Chair. CHR. KANEALI`I-KLEINFELDER: Thank you. Council Member Galimba, go ahead. MS. GALIMBA: Yeah,just a quick question. So we're at 14 percent with the current authorizations, correct? MS. NAKAGAWA: The 14.05 percent authorized but not issued. MS. GALIMBA: Right. What's the projections for authorizations in the coming year? Is that authorization going to cover us for a bit? MS. NAKAGAWA: Sorry. I'm just trying to think of the best way to answer. So one of the things that we have done particularly through our wastewater Page 10 FC-39 July 7,2026 spending and looking at our bond program out for the next ten years, we also did the same calculation on this percentage. So this percentage does increase but does stay below the 15 percent with the information that we're projecting today with the data we have today stays below the 15 percent. One of the things that we're also working on internally in Finance is looking at, there's some older authorized that we want to take a look at possibly cleaning up. At a time if there were things that we were going to do and we haven't done them, they're not a priority, we're not going to do them, then we'd like to clean up that authorization and kind of lower the authorized amount. And of course that is something we would bring forward. But it is,something that we have discussed internally that it doesn't make sense to carry that authorization if we are not going to utilize it. So of course we'd be very transparent of what those are and what was included. But we'd like to make that effort to clean that up. MS. GALIMBA: Do you have an'idea of when you might be coming back with that? MS. NAKAGAWA: You know, I think the,goal is to probably do it before the next issuance. Right now with what we're projecting, our next issuance will be in calendar year 2027, early to mid-2027 at this time with,our current spend rate. MS. GALIMBA: Okay. 'thank you,so much. MS. NAKAGAWA: Thank you. MS. GALIMBA: Very helpful. MS. NAKAGAWA: You're welcome. MS. GALIMBA:, I yield. CHR. kANEALI`I-KLEINFELDER: Thank you. Council Member Kierkiewicz. MS. KIEkKIEWICZ: Thank you, Chair. Good morning, Director. Council Member Galimba's questions kind of just sparked some interest for me here. What sort of criteria is the administration going to use to evaluate the worthiness of a prof ect continuing and being bonded? MS. NAKAGAWA: So like previous authorizations? MS. KIERKIEWICZ: Yes. If the idea is to clean it up, how are you going to handle that and make those solutions. MS. NAKAGAWA: Yeah. First, we've gone through all the different issuances back to 2008. Now some of them prior to 2016 were very specific projects. So those are a little easier. Whether or not are these projects complete, are they no Page 11 FC-39 July 7,2026 longer viable projects, right? Those were very specific to those projects. Bonds issuance after 2016 allowed a little more flexibility in the types of things we can do. So the bond language allows us to have wastewater projects and maybe general Public Works projects and things like that. So first we'll take a look, we'll pull all that out, which we've done, and then we need to meet with the departments just to look at the status of maybe something else was complete or what happened to that to just get a better handle on what has happened over the years. So from that list I think we'll have more internal discussions on priorities. It's not much different than,you know, kind of how we look at things today. There's mandates, there's public safety aspects,just things that are necessary for repair and maintenance, trying to catch up on those things. All those things will still come into play in that discussion. But of course we would have those discussions and then come back and kind of talk,through what those authorizations included and what our thoughts are on how to move them forward. MS. KIERKIEWICZ: And then procedurally,how"would we move forward with sort of adopting, would you say what the County is going to be actually moving forward on? Because it sounds like then you would be able to open up some bonding capacity for future projects. MS. NAKAGAWA: Yeah, So Chris, can you talk through the process? Okay. MS. KIERKIEWICZ: Would we have to approve another resolution? I'm just curious. MS. NAKAGAWA: You know,we'll double check on that. I believe there would he because there was a prior authorization. MS. KIERKIEWICZ: And there's a set amount in which we can be leveraging bonds before it impacts ,our credit score. MS. NAKAGAWA': Right, right. So, you know,just for an example, I'm not picking on"or I'm not choosing any one of these but let's say we came for an authorization of$150 million, we ended up issuing $99 million. So there's that authorization that is still out there in that particular bond. Now we have discussed with bond counsel and financial advisors in some of the recent ones, can we go ahead and use that authorization as we move forward. So there is some flexibility for us to be able to use some of that as we move forward. Or there's some older ones with specific projects that we've talked about that may not be priorities or may not be viable that we would like to bring forward and say I don't think this is what we should moving forward with and we should make some adjustments on the authorized amount allowing more authorization kind of to free up. It's also just a big gap between what we've authorized and what we've issued. You know, with 14 percent and eight percent, we'd like to get that a little closer and be more aligned and really plan through when we come forward with an authorization Page 12 FC-39 July 7,2026 request to Council that the projects are kind of lined up and they match, and then we do an issuance that matches the authorization and we just get a little closer to what we're asking for. MS. KIERKIEWICZ: Thank you. I appreciate that. And I just want to put on the record that I continue to advocate for the bonds that was initiated by former Council Chairman Aaron Chung, which we adopted in 2020. It elevated projects across all of our Council districts, things that were important to the Council particularly alternate and emergency roads for the Puna region. But I hope that is not something that's going to be on the chopping block and that when the administration comes forward to present on upcdates to bond issuance that there can be a robust update on the status of the projects th4vere authorized for bonding. Thank you. I yield. MS. NAKAGAWA: Thank you. CHR. KANEALI`I-KLEINFELDER: Thank you. That's where I was going too, so please make sure that, I mean, with whate know about what's needed in Puna the bond ordinance carved out by Aaron Chung carved out I think it was about$10 million for alternate roads. And we've had this discussion for years now about where we're at, connectivity, and all the different aspects of alternate emergency access routes that,would,be possible with that bond ordinance. So, yes please. We have a number of things that you could'apply that to so it would be helpful to leave that where it is. MS:NAKAGAWA: Understood. Thank you. CHR KANEALI`I-KLEINFELI)ER My other question was Schedule D, the obligation bonds reimbursable by the County Department of Water Supply. I mean,justreading that'section that means that the Water Supply Department is reimbursing the County posed bonds for the Water Department. MS. NAKAGAWA: That's correct. CHR KANEALI`I-KLEINFELDER: How does that work? MS. NAKAGAWA: That is correct. And so the Department of Water Supply snakes those payments on that issuance. CHR KANEALI`I-KLEINFELDER: And that falls under the total obligation of the County, so the County becomes the bond, what's the correct word, holder? MS. NAKAGAWA: Sorry. Those are included in the County debt. CHR KANEALI`I-KLEINFELDER: County debt paid for by? MS. NAKAGAWA: Water Supply. Page 13 FC-39 July 7,2026 CHR. KANEALI`I-KLEINFELDER: Water Supply. MS. NAKAGAWA: Correct. CHR KANEALI`I-KLEINFELDER: So, the County of Hawaii is separate of the Department of Water Supply because they are semiautonomous. We pull the bond and then the Water Supply Department reimburses us. MS. NAKAGAWA: That is correct. CHR KANEALI`I-KLEINFELDER: So if,we wanted,to improve water service, the County itself would improve the water service and then the Water Supply Department would have to figure out hew to pay back the debt to the County. MS. NAKAGAWA: If there is a bond issuance necessary or needed by the Water Department, it would go through this'parocess with the County, and they would make the payments of that particular issuance or debt. CHR KANEALI`I-KLEINFELDER: Who initiates it? MS. NAKAGAWA: What do you mean? Sorry. CHR KANEALI`I-KLEINFELDER: Odes the Water Supply Department initiate the bond,regpest or does the County initiate the bond request for the Water Supply Department?' MS. NAKAGAWA: Through practice or process it is a discussion with the Water Department,,of course with Finance. By initiates, I guess I'm not sure what you mean by initiates, like the procedural? CHR. KANEALI`I-KLEINFELDER: Yeah,procedurally. I mean, Councilman Aaron Chung always stressed that the Water Supply Department is semiautonomous. But looking at this bond here, I'm realizing the County being a separate entity from the Water Supply Department is the bond holder. And the Water Supply Department is reimbursing us, which would be from their funding source which is user fees and whatever else fees or grants that they can pull in. I'm seeing the more wholistic picture. MS. NAKAGAWA: So you could use the Iki Place improvement district as an example because that was included in—well, that's an improvement district. CHR KANEALI`I-KLEINFELDER: That's an improvement district. Different, yeah. MS. NAKAGAWA: I was trying to find an example for you. Page 14 FC-39 July 7,2026 CHR. KANEALI`I-KLEINFELDER: So they have four. They have 2008, 2016, 2020, and 2022. MS. NAKAGAWA: Sorry. I wasn't here for a recent one, so I was asking Chris if he recalled the issuance. But if you look we do list Iki Place because it is a water project. I know it's an improvement district, but if you look at the ordinance it does come through as a County authorizing actions to the Director of Finance. So if that's what you're asking, it goes through County Finance authorization process on behalf of the Department of Water;. CHR KANEALI`I-KLEINFELDER: So itwouldbk legislatively driven either by the Council or the Mayor or a combination of both?— MS. NAKAGAWA: Yes. CHR KANEALI`I-KLEINFELDER Okay. MS. NAKAGAWA: Do we come forward with all of the authorizations? Yes, absolutely. CHR KANEALI`I-KLEINFELDER: Interesting,, Schedule D, are all of those issued? MS. NAKAGAWA: Yes. CHR KANEALI`I-KLEINFELDER: And used in full? MS. NAKAGAWA: I'm sorry, what was your question? CHR KANEALI`I-KLEINFELDER: What is the other term you're using? So we have issuance and MS. NAKAGAWA: Authorized but unissued. No, no, no. What you see in front of you are issued debt. CHR KANEALI`I-KLEINFELDER: Okay. Okay. Interesting. Thank you. Okay. Thank you very much, Department of Finance. We have the motion on the flexor to close file on Communication 938. Anyone opposed to the idea? No. All in„favor? Page 15 FC-39 July 7,2026 Vote on Comm. 938: The motion to close file on Comm. 938 was carried by the Filed following voice vote: Ayes: Committee Members Galimba, Hustace, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, Villegas, and Chair Kaneali`i-Kleinfelder—9. Noes: None. Absent: None. Excused: None. ADJOURN- There being no further business on our agenda'today, Chair Kaneali`i-Kleinfelder MENT: adjourned the meeting at 9:38 a.m. Thank you very much. Approved: Mr. Matt Kaneali`i-Kleinfelder, Chair (Date) Finance Committee MK/tk Page 16