HomeMy WebLinkAboutREP FC 075 04/20/1999 1998-2000 REPORT OF THE
COMMITTEE ON FINANCE
DATE: Apri120, 1999 Re: Comm. No. 76/Bill No. 22
PLACE: Councilroom
TIME: 10:45 A.M.
Chair and Members
Hawaii County Council
Hilo, Hawaii 96720
Bill No. 22, transmitted by Mayor Stephen K. Yamashiro, via Communication No. 76, dated
December 28, 1998, authorizes the issuance, sale and delivery of general obligation refunding
bonds for the purpose of paying or providing for the payment of all or any part of the
Outstanding 1978 Refirnded Bonds in order to effect savings to the County in payment of
principal and interest on the Outstanding Bonds.
Originally heard on January 15, 1999, this measure was deferred until today's meeting pending
two public hearings held in Hilo and Kona, and the review of the Mayor's proposed FY 1999-00
budget.
In 1978 the County issued general obligation bonds of the County of which is currently
outstanding twenty million seventy five thousand dollazs ($20,075,000). Currently, the interest
rates for general obligation bonds of governmental issuers that are rated comparable to the
ratings of the County are lower than the rates being paid on the 1978 refunded issue.
Furthermore, the conditions in the current municipal market for bonds of the character of general
obligation bonds of the County make it advisable, expedient and in the best interest of the
County to authorize the issuance, sale and delivery of general obligation refunding bonds.
The approval of Bill No. 22 will enable the County to defease the 1978 issue, which will then
increase the working capital by $8.7 million from the Sinking Fund.
Pursuant to Chapter 47, Section 47-17, Hawaii Revised Statutes, there are hereby authorized for
issuance and sale at one time or from time to time in series general obligation bonds of the
County in such principal amount as shall be required to yield an amount sufficient for the
purpose of paying or providing for the payment of all or any part of the Outstanding Bonds at or
before the stated maturity or redemption date thereof, as the Director of Finance shall determine
to be in the best interest of the County, and to pay all or part of the costs incurred in the issuance
of such Bonds and to effect the refunding of all or any part of the Outstanding Bonds. The
proceeds of the Bonds of any particulaz series shall be applied as directed by the Director of
Finance to the payment of the principal of, and redemption premium, if any, and interest on the
Outstanding Bonds to be refunded, and for other certain limited purposes.
Pursuant to Chapter 3, Section 5-3.3(c), Hawaii County Charter, the Director of Finance shall
negotiate loans and the issuance and sale of bonds and notes when authorized by the Council.
FC REPORT NO. 75
Members of Your Committee expressed concerns with a total defeasement of the Sinking Fund.
Instead Members suggested saving a portion of the Sinking Fund to subsidize the closure of the
Hilo Landfill. Also, some members felt that more information was still needed in order for them
to approve this measure.
Your Committee on Finance is in accord with the purpose and intent of Bill No. 22 and
recommends it pass first reading.
lci
ny~, Noes a&e Ex Respectfully submitted
CHUNG X
ELARIONOFF X COMMITTEE ON FINANCE
JACOBSON X
LEITHEAD-TODD X
PISICCHIO X
SMITH X
TvLER X AARON S.Y. CHUNG, CHAIR
YAGONG X FC REPORT NO. 7
ARAKAKI, E.O.M. X ADOPTED: MAY O S WQ~