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Home My WebLink AboutCOM 0075.015 2002-2004 JMSY OF H,w c~' v~,I~Ge. Harry Kim Barb}a~ra~rBell Mayor ~7 iL.. - -,i ?)F O•F•M~J' '03 JUN 9 A(~ 8 SI nun#u n£ ~r~futtti ~~~~clIo~~~~~. ~ i_~_~~~,:: DEPARTMENT OF ENVIRONMENTAL MANAGE1VfLrlY7`Tt~ ` d- H~'tV`JAII 25 Aupuni S[ree[, Room 208 • Hilo, Hawari 96720-4252 (808) 961-8083 • Fax (808) 961-8086 June 6, 2003 HONORABLE JAMES ARAKAKI, CHAIRMAN, AND MEMBERS HAWAII COUNTY COUNCIL 25 Aupuni Street Hilo, HI 96720 SUBJECT: PROPOSED ORDINANCE AMENDING CHAPTER 20 OF THE HAWAII COUNTY CODE 1983 (1995 EDITION), RELATING TO REFUSE, FEE SCHEDULE, BILL 36, DRAFT 7 Drag 7 of the proposed ordinance is attached for your review and consideration. This draft reflects the changes discussed at the County Council meeting of May 21, 2003 and a public meeting, attended by haulers, held June 5, 2003. It also further clarifies how the residential hauler's credit is allotted and audited. Draft 7 addresses four issues: 1. In the Financial Audit Report for fiscal year ending June 3Q 2003, approved by Council May 21, 2003, the auditors for the Council address the ongoing problem of collection of receivables. Language is now included to: • Strongly encourage more timely payments. In Section 20-46(c) a requirement is added for haulers to maintain a current account status in order to claim these credits. This is a fair and prudent step to accelerate the collection of receivables. The residential credit benefits the haulers and is a substantial incentive for them to make timely payments. By raising the residential haulers' partial credit (presently $2.00/month at $35/ton landfill tip fee) to a full credit ($5.60/month at $45/ton landfill tip fee) the haulcrs' costs are significantly reduced. This will enable them to keep their accounts current on a monthly basis. • Stipulate the credit shall not exceed the haulers' tipping fees charged for the month in which the credit is being claimed. According to current records, some haulers' credits will be larger than their tipping fee charges for the month, thereby necessitating the County to refund monies without this stipulation. For example, if a hauler disposed of 300 tons in July 2003 and reported 3,325 residential customers. With the $45/tou tip fee and $5.60 credit, his tip fees for the month would be $13,500 and his credit would be $18,620, leaving him with a $4,120 bonus in this one month! 2. Privacy of records has been addressed. Because of business and privacy concerns, Hawaii Revised Statutes, Chapter 92 is referred to in Section 20-46 (c). See attachment. Comm. No, Ref. To: R`?~ Ref. Uate , 3. Service addresses will serve the function of identifying location. The requirement of tax map key number is not needed. 4. Section 20-46 (e) has been amended to include an annual analysis of the Solid Waste Division expenses. In addition, Solid Waste Administrative Rules will be amended to reflect the changes resulting from the adoption of this Ordinance. The changes will need to include: • Reflection of the term "current" to match our present policy of accounts with outstanding promissory notes are deemed current if terms of the note are being met. • Procedures to protect the confidentiality of the information haulers have provided. Customer lists provided by haulers will be used for audit purposes only. • Clarification that the records will be destroyed in accordance with State law and within a reasonable audit period. Should you have~an~y~questions, please contact me at 961-8083. Barbara Bell DIRECTOR cc: Harry Kim, Mayor Gary Safarik, Chair, Council Committee on Parks and Environmental Management Riley Smith, Chair, Environmental Management Commission Attachments: Bill 36, Draft 7 Residential Hauler's Credit Audit Process Hawaii Revised Statutes 0092F-0013 Office of Information Practices Opinion 94-14 JMiY OF N1 k' harry Kim Barbara Bell Mayor _ DireGOr mot' / ~FF'C~•„I,JI~!i.} ~YY Nisi ~l Y~ ..~7~t.L M+(1~LL DEPARTMENT OF ENVIRONMENTAL MANAGEMENT 25 Aupuni Street, Room 208 • Hilo, Hawaii 96720-4252 1808) 961-8083 • Fax (808) 961-R086 June 6, 2003 Residential Hauler's Credit Audit PURPOSE: To obtain reasonable assurance that credits claimed by each hauler are accurate and proper. Whereas the Residential Hanler's Credit represents lost revenue to the County of Hawaii, the Department of Environmental Management (DEM) intends to conduct an audit of each Residential Hauler's Credits annually. More frequent audits maybe conducted if deemed necessary. PROCEDURE: I. REQUIRED INFORMATION A. Haulers shall be required to submit a list of each credit being claimed for that month, to include customer name, mailing address and service address. The customer's name is required as it would be the first indication of whether or not they are a residential customer. If the customer's name was ABC Construction, that would be a red flag for filrther review. The mailing address is required so verification letters can be sent to customers. The service address is required because many people have a different mailing address, making it difficult to verify that the service was being provided to a single family household. B. Haulers shall also be required to make their records available for audit upon request by DEM. Haulers shall be given cone-week notice to allow them time to arrange their schedule accordingly. C. Information obtained shall be used only for auditing purposes. II. SAMPLE SELECTION A. A random sample o f the customers reported shall be selected (a minimum of 10%, but can be expanded based on results). B. The full customer list shall be reviewed and, if discrepancies are found, such as an address that may appear to be part of an apartment complex, an address that seems to be outside the vendor's normal service area, a customer that appears on another vendor's customer list for the same time period, etc., those customers shall be added to the sample group. III. CUSTOMER VERIFICATION A. Verification letters shall be mailed to each customer in the sample group. The letter request verification that the addressee is, or was, a customer of the said vendor during the specified months, and that the service address listed is correct. A self addressed, postage paid envelope shall be included with a requested response date. After the requested response date has passed, DEM may make one more attempt to contact those who have not responded, either by phone (if number is listed) or by sending out a second request. B. The verification letter shall include a reference to the ordinance providing for the residential hauler's credit and will explain the purpose of the audit. IV. ADDITIONAL VERIFICATIONS A. If a reasonable number of responses to the verification letters are received and do not show any cause for concern, the audit shall be deemed complete. B. Should DEM receive a less than satisfactory number of responses, additional verification letters maybe sent out or DEM may request to review the hauler's records. C. If responses to the verification letters indicate a cause for eoncem, DEM's options would be to expand the sample and send out additional verifications to more, or even all, customers or to go to the vendor's place of business and conduct a full audit of their receivables. Auditing their receivables would include looking at each customer's account and verifying that they were an active account during the months reported. The account should show that the customer was being billed and was making payments. Accounts with no payments for several months may indicate that the account should not be active and the hauler may have cancelled service, in which case we would want verification from the customer that they are still receiving services. For customers who receive complimentary services from the hauler, it shall be the hauler's responsibility to provide documentation verifying that service. Page 1 of 1 592F-13 Government records; exceptions to general rule. This part shall not require disclosure of: (1) Government records which, if disclosed, would constitute a clearly unwarranted invasion of personal privacy; (2) Government records pertaining to the prosecution or defense of any judicial or quasi-judicial action to which the State or any county is or may be a party, to the extent that such records would not be discoverable; (3) Government records that, by their nature, must be confidential in order for the government to avoid the frustration of a legitimate government function; (4) Government records which, pursuant to state or federal law including an order of any state or federal court, are protected from disclosure; and (5) Inchoate and draft working papers of legislative committees including budget worksheets and unfiled committee reports; work product; records or transcripts of an investigating committee of the legislature which are closed by rules adopted pursuant to section 21-4 and the personal files of members of the legislature. [L 1988, c 262, pt of §1; am L 1993, c 250, ~1] Previous Next http://www.capitol.hawaii.gov,/hrscurrentrVo102_Ch0046-0115/hrs0092F/HRS_0092F-0013.htm 6/5/03 Office of Information Practices Opinions Page ] of 4 Office of Information Practices Opinions Honorable Yukio Kitagawa July 27, 1996 Page August 10, 1994 The Honorable Yukio Kitagawa Chairperson, Board of Agriculture 1428 S. King Street Honolulu, Hawaii 96814-2512 Attention: Larry M. Nakahara, Manager Plant Quarantine Branch Dear Mr. Kitagawa: Re:Records Concerning the Importation of Green Coffee Beans This is in response to your memorandum dated February 23, 1994 to Attorney General Robert A. Marks requesting an opinion concerning the public's right to inspect and copy the above-referenced government records. In accordance with established protocol, your letter was forwarded to the Office of Information Practices ("OIP") for the issuance of an advisory opinion. ISSUE PRESENTED Whether, under the Uniform Information Practices Act (Modified), chapter 92F, Hawaii Revised Statutes ("UIPA"), import permits, inspection reports, shipping manifests, and invoices maintained by the Department of Agriculture concerning the importation of green coffee beans into the State must be made available for public inspection and copying upon request. BRIEF ANSWER Yes. However, information in the import permits, inspection reports, shipping manifests, and invoices that reveals the price or quantity of the imported green coffee beans constitutes "confidential commercial and financial information" because the disclosure of this information would likely result in substantialharm to the competitive position of the importer. Consequently, al] information in the aforementioned records that reveals quantity or price is protected by the UIPA's "frustration of a legitimate government function" exception and must be segregated from the requested records before they are disclosed. FACTS The State Department of Agriculture, Plant Quarantine Branch, regulates the quarantine of plant and non-domestic animals imported into the State. Records maintained by the Deparhnent regarding the importation of green coffee beans include import permits, inspection reports, shipping manifests, and invoices. Importers of green coffee beans must file an "Import Permit" ("Permit") with the Plant Quarantine Branch. A blank copy of the Permit is attached as Exhibit "A." The Permit authorizes the importation of a certain quantity of a commodity, in this case, green coffee beans, within a certain time period. Other information contained on the Permit includes the date of the permit, the permit number, conditions of importation, the name and address of the shipper, and the name, address, and telephone number of the importer. The form also contains signature lines for the Chief Plant Inspector, and the Chairperson of the Board of Agriculture. http://64.29.92.28/RW/Legal_ Research/Hawaii/Info/94-14.htm 5/29/03 Office of Information Practices Opinions Page 2 of 4 The Permit may also contain remarks indicating the date and time when the coffee bean shipment was inspected and whether the shipment requires fumigation. Some of the Permits also contain notes concerning the date and time the shipment was fumigated, the type and amount of fumigant used, the name of the fumigator, and the date and time the fumigant was exhausted from the shipment. The Plant Quarantine Branch requires all imported green coffee beans to be treated to prevent the spread of coffee rust disease. Importers may either fumigate the beans before shipping, in which case there must be a certification of treatment attached to the shipment, or importers may arrange for a pesticide applicator to fumigate the beans at the port of entry in Hawaii. Untreated beans are quarantined until treated by a pesticide applicator. The Plant Quarantine Branch's Inspection Report, a blank copy of which is attached as Exhibit "B," contains the following information: 1. Port 2. Arrival date 3. Ship 4. Origination of ship 5. Shipment number 6. Baggage Claim Check number 7. Inspection date/time 8. Name of inspector 9. Permit number and date 10. Commodity and amount 1 1. Remarks 12. Consignor's name and address 13. Consignee's name and address 14. Pest found 15. Treatment 16. Charges (dollar amount) 17. Disposition (Passed, Treated, Pending, Returned to Shipper, or Destroyed) 18. Date delivered 19. Time 20. Person who delivered 21. Signature of importer or agent 22. Remarks/Additional Commodity The Plant Quarantine Branch also requires all imported shipments of green coffee beans to be accompanied by an invoice or shipping manifest listing the amount and type of coffee beans being shipped. The sample invoices that were provided for the OIP's review contained the following types of information: 1.Name, address, and telephone number of the consignor 2.Name and address of the purchaser 3.Invoice number 4.Invoice date S.Ship 6.Ship date 7.Due date 8.Tertns of shipping 9.Customer Identification Number lO.Purchase Order date 11.Seller's order number 12.Name of salesman 13.Product identification 14.Description of product 15.Amount ordered 16.Amount shipped 17.Unit/Measure (of shipment) 18.Unit price 19.Amount 20.Tax 21. Total The Plant Quarantine Branch also maintains copies of shipping manifests relating to imported green coffee beans. Samples of these shipping manifests provided for the O1P's review contained the following types of information: 1. Name and address of consignor 2. Name and address of consignee 3. Destination 4. Route 5. Delivering Carrier 6. Car number 7. Number of packages 8. Description of articles 9. Weight of each unit 10. Freight charges 11. Total weight 12. Total freight charges In a request to Larry Nakahara, Manager of the Department of Agriculture's Plant Quarantine Branch, dated February 8, 1994, Jeff Citron, Legislative Chairman of the Kona Coffee Council, requested copies of "permits issued to all companies that brought shipments of green coffee" to the Big Island. He also requested copies of all the invoices, shipping manifests, packing slips or orders slips that were shipped with the coffee beans. DISCUSSION Under the U[PA, "[a]ll government records are open to public inspection unless access is restricted or closed by law." Haw. Rev. Stat. 0 92F-] 1(a) (Supp. 1992). Further, section 92F-11(b), Hawaii Revised Statutes, provides that "[e]xcept as provided in section 92F-13, each agency upon request by any person shall make government records available for inspection and copying during regular business hours." http://64.29.92.28/RW/Legal_Research/Hawaii/Info/94-14.htm 5/29/03 Office of Information Practices Opinions Page 3 of 4 Of the five exceptions to required agency disclosure in section 92F-13, Hawaii Revised Statutes, only one exception possibly applies to the records at issue here. Section 92F-13(3), Hawaii Revised Statutes, states that the UIPA does not require the disclosure of "[g]overnment records that, by their nature, must be confidential in order for the government to avoid the frustration of a legitimate government function." One example provided by the Legislature of information protected by this "frustration" exception is "trade secrets or confidential commercial and financial information." See S. Stand. Comm. Rep. No. 2580, 14th Leg., 1988 Reg. Sess., Haw. S.J. 1093, 1095 (1988). The federal Freedom of Information Act, 5 U.S.C. 0 552 (1988) ("FOIA"), contains a similar exemption for "trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential." 5 U.S.C. o552(b)(4) (1988). [In several previous OIP opinion letters, we found guidance in case law applying Exemption 4 of FOIA when determining whether information constitutes "confidential Commercial and financial information." See OIP Op. Ltr. No. 92-17 (Sept. 2, 1992); OIP Op. Ltr. No. 93-1 (April 8, 1993).] Determining whether commercial or financial information in a requested record is "confidential" has been the critical issue in most Exemption 4 litigation. The applicable standard for determining whether such information is "confidential" is set forth in a two-part test created by the Court of Appeals for the District of Columbia Circuit in National Parks & Conservation Association v. Morton, 498 F.2d 765 (D.C. Cir. 1974): To summarize, commercial or financial matter is "confidential" for purposes of the exemption if disclosure of the information is likely to have either of the following effects: (1) to impair the Government's ability to obtain necessary information in the future; or (2) to cause substantial harm to the competitive position of the person from whom the information was obtained. National Parks at 770. The OIP has applied this two-part test in previous opinion letters to determine whether commercial and financial information is "confidential." See OIP Op. Ltr. No. 92-17 (Sept. 2, 1992); OIP Op. Ltr. No. 91- 29 (Dec. 23, 1991); and OIP Op. Ltr. No. 90-21 (June 20, 1991). We do not believe that the first prong of the two-part National Parks test applies to the facts presented. Disclosure of the records is not likely to impair the government's ability to obtain necessary information in the future because the importer is required to submit the records in order to import the coffee beans into the State. See OIP Op. Ltr. No. 91-16 at 11 (Sept. 19, 1991) and cases cited therein. However, we must determine whether the second prong of the National Parks test would apply to protect certain information contained in the records requested. The records provided for the OIP's review include information such as quantity and price of the beans shipped. We believe that this information, if disclosed, could result in substantial harm to the competitive position of the importer. Under federal case law, price and quantity information has been found to be protected under the second prong of the National Parks test. In Timken Company v. United States Customs Service, 491 F. Supp. 557 (D.D.C. 1980), the District Court of Columbia held that the disclosure of the price and quantity of roller bearings imported from Japan would cause competitive injury to both importer and exporter because the information would enable competitors and customers to estimate profit margins and production costs, and thereby give competitors insight into the company's competitive strengths and weaknesses. Thus, the court found that the price and quantity data was protected from disclosure by Exemption 4 of the federal FOIA. See also Braintree Electric Light Department v. Department of Energy, 494 F. Supp. 287, 289 (D.D.C. 1980) (selling prices, inventory balances, thruput charges, profit margins, purchase activity, freight charges, and cost of goods sold are protected under Exemption 4). Consequently, we are of the opinion that any information revealing the quantity or price of the green coffee beans imported into the State should be segregated from the import permits, the inspection reports, the shipping manifests, and the invoices before they are disclosed to the public. However, the http://64.29.92.28/RW/Legal_Research/Hawaii/Info/94-14.htm 5/29/03 Office of Information Practices Opinions Page 4 of 4 remaining information in the rccords would not constitute "confidential commercial and financial information" and, therefore, should be made available for public inspection and copying upon request. As a final note, we observe that section 92F-12(a)(13), Hawaii Revised Statutes, which specifically makes public "[r]osters of persons holding licenses or permits granted by anagency that may include name, business address, type of license held, and status of the license," does not apply to the present situation. The records requested concern the importation of green coffee beans, not a roster of the Import Permit holders. CONCLUSION The UIPA's "frustration of a legitimate government function" exception, which protects "confidential commercial and financial information," applies to the quantity and price information in the import permits, the inspection reports, the shipping manifests, and the invoices concerning the importation of green coffee beans into the State. This information must be segregated from the records before they are made publicly available under the UIPA. Very truly yours, Stella M. Lee Staff Attorney APPROVED: Kathleen A. Callaghan Director SMLac Attachments c: Jeff Citron Kona Coffee Council OIP Op. Ltr. No. 94-14 BACK Hume ~ About HSBA ~ Hawaii Resources Other Resources ~ Contact HSBA ~ Graphics Version "1'cx~-Only Version. http://64.29.92.28/RW/Legal_Research/Hawaii/Info/94-14.htm 5/29/03