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Home My WebLink AboutCOM 0604.007 2010-2012 +11 CT h'�+,'` William T.Takaba ^„\' '�-' Managing Director William P. Kenoi .''\��. : r:. .Ma Y or Walter K.M.Lau • •r •.1,, Deputy Managing Director County of Hawaii• Office of the Mayor 25 Aupuni Street,Suite 2603 • Hilo,Hawai`i 96720 • (808)961-8211 • Fax(808)961-6553 KONA: 74-5044 Ane Keohokalole Hwy.,Bldg.C • Kailua-Kona,Hawai`i 96740 � (808)323-4444 • Fax(808)323-4440 R-3 :{ .-{ May 3, 2012 , , `°1 Honorable Members of the Hawai`i County Council County of Hawai`i : „_ 25 Aupuni Street -- j..- Hilo, HI 96720 ta Aloha Council Members: As required by the Hawaii County Charter, submitted with this message is the amended operating budget for the County of Hawai`i for the fiscal year (FY) ending June 30, 2013. This balanced budget includes estimated revenues and appropriations of $365,120,019 and includes the operations of eleven of the County's special funds as well as the general fund. This FY 2012-2013 budget is $38,084,979 or 9.4 percent less than the budget in effect when this administration took office in 2008. It marks the fourth consecutive year of our efforts to reduce the size and cost of government in a strategic and responsible manner that maintains critical infrastructure and public services. This balanced budget does not require any increase in property taxes. County of Hawaii Operating Budget $410,000,000 5403.204 998 5400,000.000 01 $390,000,000 0 $387,846,203 _ $330,000,000 0 a 5375,908 318 5370,000,000 III $367,294,364 $365,120019 _ $350,000,000 milli 5350,000.000 0 III $340,000,000 2D08-09 2009-10 2G10-11 2011-12 2012-13 County of Hawaii is an Equal Opportunity Provider and Employer. Comm. N0. `0 Ref. To: CAJIMAC..i i , CD; Il I a7 , Drvct et) Ref. Date MAY 07 .2012 _, e Honorable Members of the Hawai`i County Council May 3,2012 Page 2 Collecting Less Taxes For the fourth straight year,the County of Hawaii will collect less in property taxes than it did when this administration began in 2008. Tax collections in FY 2008-09 totaled $225.9 million and are expected to decrease to $198.3 million during FY 2012-2013. This continuing slide in tax collections has been coupled with years of cost increases in areas such as employee health care and retirement costs and unpredictable fluctuations in utilities and fuel. In short, it will cost us more to deliver the same services next year, and there will be less money available to provide these services. Real Property Tax Revenue $230,000,000 $225,858 382 0 $218 0 37 567 .216 511.277 $220,000,000 $207, 'I ''' $210,000,000 1 III 5198,300 000 III $200,000,000 $190,000,000 ■ III $180,000,000 2008-09 2009-10 2010-11 2011-12 2012-13 Actual Actual Actual Budget Budget Reducing the Size and Cost of Government This budget represents the fourth consecutive year that we are reducing spending. Consulting contracts have been cut by more than $12 million since FY 2007-2008. Overtime spending is also being reduced by 38 percent during this same time period, for an additional reduction of$5.3 million. Professional Services Contracts $23,000,000 -416,559,095 $15,000,000 Uirseltrts_ 513,000,000 ,374 696 $5,000,000 S1 2007-08 2008-09 2009-10 2010-11 Honorable Members of the Hawai`i County Council May 3,2012 Page 3 Overtime Total - All Funds 515,000,000 31186E,785 II-1iIFlIii. 510, , 5 2007-08 20D8-09 2009-10 2010-11 2011-12 2012-13 Actual Actutl Actual Actual Budget dgct This budget discontinues a subsidy for the West Hawai`i golf program and preserves a scaled- back lava-viewing program. It restricts out-of-state travel, cancels or delays vehicle purchases and the replacement of aging computers and software, and employee training has been deferred or eliminated. Passenger Vehicle Purchases All Funds 9s loo I 77 50 II 20 �16 o __- 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Actual Actual Actual Actual Budget Budget Further, we have cut special counsel, trial aides and law clerks for the prosecutors' office, reduced courier service, cut appraisals, environmental assessments and surveys, and reduced the workers compensation budget. Two hundred twenty-two vacant positions have been unfunded during the first three years of this administration. Although it has been very challenging, for the upcoming year, we intend to again hold more than 200 positions unfilled and unfunded. Leaving these vacant positions unfunded will save the county $7.1 million. The total employee count for the County of Hawaii was reduced from 2,787 on November 30, 2008 to 2,593 as of May 1, 2012. Employee Count 2850 2800 2750 2700 2650 2600 2550 2500 2450 cp% o°a o° �, ooa ono o-o o-o ono Honorable Members of the Hawai`i County Council May 3,2012 Page 4 Though some items have changed from the March 1, 2012 budget submittal, this budget continues to represent this administration's commitment to reduce the cost of government and maintain core services to support and benefit our island community. The total budget decrease of an additional $173,329 consists of relatively minor adjustments throughout the budget that reflect operational changes or refined estimates since March. Fuel cost and self insurance estimates were carefully reviewed and it was determined that no changes were required. Discussion regarding significant items impacting the budget, as well as information on specific changes, follows. DETAILS Significant Changes to March 1,2012 Revenue Estimates General Fund • Real Property Tax — the tax calculation based on certified values is consistent with the amount estimated in March, so no changes were made. The real property tax interest estimate was reduced by $200,000 to reflect anticipated collections. • Public Service Company Tax — anticipated revenues were reduced by $142,400 based on revised estimates. Solid Waste Fund • Recycling— grant revenue for used oil and electronic waste recycling totaling $155,000 was added to the budget and county funding of those programs was reduced. Significant Chances to March 1,2012 Expenditure Estimates General Fund • Prosecuting Attorney — funding was increased by approximately $95,000 to support the Career Criminal Program,by supplementing reduced funding from grants and other sources. • Transfer to Solid Waste — subsidy to the fund has been reduced by $155,000. The Department of Environmental Management is anticipating grant funding for certain recycling programs, so county funding was reduced. • Health Benefits — based on current information from EUTF an adjustment was made to reduce cost estimates by$95,000. • Retirement Benefits — based on updated estimates the budget for retirement benefits was reduced by $125,000. Position Changes from March 1,2012 Budget Proposal There were no additional changes to the March budget submittal. Honorable Members of the Hawai`i County Council May 3,2012 Page 5 Conclusion I am deeply appreciative of the support and dedication of our hardworking county employees for their sustained commitment to reduce both the size and cost of government, and their willingness to do more with less. This spirit of cooperation and determination has enabled us to establish a balanced budget without having to raise property taxes. We are especially indebted to the fiscal discipline and sound advice of our Finance Team. They have provided consistent and strategic direction throughout this very challenging,but rewarding process. The amended budget I am submitting is the result of many months of cooperation and collaboration between all of our department heads and county employees. We would like to thank the members of the State Legislature for their cooperation and support in maintaining the County of Hawaii's share of the Transient Accommodations Tax. This partnership has allowed us to maintain our balanced budget. We will also continue to work with our Congressional delegation to secure federal resources as we expand our transportation infrastructure and build important capital improvement projects. We are cautiously optimistic that we will see an improved economy through growth in the hospitality, construction, and agricultural industries. Continued investment in the renewable energy, higher education,transportation, and science and technology sectors will,hopefully, lead to a thriving and vibrant Hawaii Island economy and an improved financial outlook for the County of Hawaii. We look forward to working with the Community and the County Council as we seek to maintain a balanced and responsible budget. Aloha, (P. William P. Kenoi MAYOR Attachment NARRATIVE SUMMARY OF BUDGET AMENDMENTS OPERATING BUDGET FY 2012-2013 GENERAL FUND REVENUES: The Real Property Tax Interest and Public Service Company Tax amounts have been reduced based on our latest estimates. Adjustments were made to the State's grant funding for the Department of Finance's Periodic Motor Vehicle Inspection (PMVI) and the Commercial Driver's License (CDL) Programs. EXPENDITURES: LEGISLATIVE The Clerk-Council Office amended its budget to reduce its salaries and wages account, due to adjustments and to the unfunding of a position. Reductions were made to their travel, advertising, equipment repairs, mileage, miscellaneous charges, and equipment accounts. Increases were made to their telephone and rental/lease of equipment accounts. The Elections Division has amended its salaries and wages account for adjustments and the unfunding of a position, and reduced their lease amount for the Kona Elections Warehouse. The Legislative Auditor decreased the external audit provision. INFORMATION TECHNOLOGY The budget was amended to include more funding to replace the County's aging computer servers. FINANCE The salaries and wages accounts of the Administration, Accounts, Treasury, Real Property Tax, Vehicle Registration & Licensing, Driver License, PMVI, and CDL Divisions were amended to reflect its personnel changes and payroll requirements. CDL monies will partially fund a hybrid PMVI/CDL position. Funds that were budgeted in the Mass Transit Agency's lease account for their office space, are being transferred into Property Management Division's budget. CORPORATION COUNSEL The Corporation Counsel's budget was amended to reflect an increased amount for their Westlaw subscription and for a personal computer. HUMAN RESOURCES The Human Resources Department has revised its payroll budget request for its salaries and wages account and has reduced their training consultant cost. RESEARCH & DEVELOPMENT R&D's budget was revised with funds for their sister city initiatives being moved from their tourism promotion account and placed in their business development account. The salaries and wages account was amended to meet the needs of this department. Funds for a replacement time stamp machine were also included. PUBLIC WORKS The Public Works budget has been amended with adjustments for a) salaries and wages requirements, b) additional air conditioning and septic tank maintenance, c) electricity needs, and d) fall protection harnesses for the Building Division. POLICE The budget adjustments reflect an increase to its Puna Station electricity and a reduction to its courier service expense. FIRE Amendments to various salaries and wages accounts reflect the graduation of a recruit class and the movement of fire personnel amongst the district fire stations and payroll requirements. PROSECUTING ATTORNEY The Prosecutor's budget was amended to include supplemental funding for the Career Criminal Program and to reduce its courier service expense. MASS TRANSIT The Mass Transit Agency's office space lease has been transferred over to the Finance Department's Property Management Division. PARKS AND RECREATION The Parks Department budget has amendments that affect their salaries and wages accounts of Parks Maintenance, Recreation, Ho`olulu Complex, and Aquatics to reflect personnel charges and payroll requirements. Additional funds were included for the lava viewing program, to maintain it on a reduced basis. MISCELLANEOUS The subsidy to the Solid Waste Fund was amended as a result of that Fund's budget revision. The transfer amount budgeted for the Public Access/Open Space Preservation Fund was adjusted to reflect the projected decrease in Real Property Tax Interest. Health and Retirement Benefits accounts were reduced to reflect the latest projections. HIGHWAY FUND EXPENDITURES: TRAFFIC: The Traffic Division adjusted funding within its salaries and wages (to reflect reallocations), other current expenses (adjustments to telephone and janitorial) and equipment (voice over IP phone system) accounts to meet the needs of their operations. SOLID WASTE FUND REVENUES: Adjustments include the State Department of Health's (DOH) reduction of the Glass Recycling Program grant and the inclusion of two other grants: Used Oil Collection/Disposal and Electronic Waste Recycling. The subsidy from the General Fund has been amended to reflect the changes in expenditures for these programs. EXPENDITURES: The Solid Waste Division amendments reflect the DOH's grant amendments and the reduction of county funds that were already included in its budget. HOUSING FUND REVENUES: The Housing Assistance Program grant estimate has been revised downwardly. The fund balance from the previous year was amended to make up for the grant reduction and expenditure adjustment. EXPENDITURES: Adjustments to the regular salaries and wages and fringe benefits accounts were based on payroll requirements. GENERAL FUND PART A ADJUSTMENTS REVISED 2012-13 ADD 2012-13 ACCOUNT NO. DESCRIPTION ESTIMATE REDUCE ESTIMATE REVENUES 3101.16 RPT Interest 1,200,000 (200,000) 1,000,000 3106.11 Public Service Co Tax 9,520,000 (142,400) 9,377,600 3304.53 PMVI Program Income 485,645 (29,874) 455,771 3304.56 CDL Program Income 360,544 29,874 390,418 TOTAL ADJUSTMENTS (342,400) EXPENDITURES LEGISLATIVE 5101.01 Clerk-Council Svc S&W 2,465,345 (56,861) 2,408,484 5101.02 Clerk-Council Svc OCE 408,280 (59,620) 348,660 5101.06 Clerk-Council Svc Equip 72,000 (45,000) 27,000 ELECTIONS 5107.01 Election Division - S&W 372,145 6,156 378,301 5107.02 Election Division-OCE 513,429 (25,951) 487,478 LEGISLATIVE AUDITOR 5108.15 External Audit 375,000 (40,000) 335,000 INFORMATION TECHNOLOGY 5118.10 Information Tech Eqpt 101,500 20,000 121,500 FINANCE 5121.01 Fin Admin& Budget S&W 482,402 1,122 483,524 5122.01 Accounts- S&W 542,081 9,132 551,213 5124.01 Treasury-S&W 285,820 (10,165) 275,655 5125.01 Real Property Tax- S&W 1,875,553 (31,217) 1,844,336 5127.01 Veh Reg& Lic Admin S&W 155,141 (985) 154,156 5127.11 Vehicle Regist S&W 630,842 (19,382) 611,460 5127.21 Driver License S&W 656,192 (11,462) 644,730 5127.31 PMVI Pgm S&W 362,337 (27,158) 335,179 5127.32 PMVI Pgm OCE 120,558 (2,716) 117,842 5127.41 Comm Driv Lic Pgm S&W 288,088 27,158 315,246 5127.42 Comm Driv Lic Prog OCE 68,356 2,716 71,072 5129.02 Property Mgmt OCE 1,785,940 40,000 1,825,940 CORPORATION COUNSEL 5131.02 Corporation Counsel OCE 464,058 2,200 466,258 5131.06 Corporation Counsel Eqpt 0 1,600 1,600 REVISED 2012-13 ADD 2012-13 ACCOUNT NO. DESCRIPTION ESTIMATE REDUCE ESTIMATE HUMAN RESOURCES 5151.01 Human Resources S&W 1,345,075 47,672 1,392,747 5151.11 Training Expenses 60,544 (48,944) 11,600 RESEARCH & DEVELOPMENT 5161.01 Research & Dev S &W 621,001 48,941 669,942 5161.18 Research & Dev Eqpt 0 800 800 5161.60 Tourism Promotion 779,000 (4,000) 775,000 5163.20 Business Development-R& D 50,550 4,000 54,550 PUBLIC WORKS 5171.21 Building R&M S&W 681,384 1,568 682,952 5171.22 Building R&M OCE 2,091,985 42,500 2,134,485 5232.06 Bldg Inspctn- Equipt 0 3,000 3,000 POLICE 5203.02 Police Adm Div- OCE 8,794,349 (15,000) 8,779,349 5214.02 Puna Police-OCE 122,263 6,429 128,692 FIRE 5221.01 Fire Protection- S&W 18,743,405 0 18,743,405 5221.51 Fire EMS-S&W 9,397,174 0 9,397,174 5223.01 Ocean Safety S&W 1,401,097 0 1,401,097 5223.31 W.HI Ocean Safety S&W 410,484 0 410,484 PROSECUTING ATTORNEY 5271.01 Prosecuting Atty S&W 3,746,990 95,130 3,842,120 5271.02 Prosecuting Atty OCE 392,689 (5,000) 387,689 MASS TRANSIT 5311.02 Mass Transit-OCE 942,199 (40,000) 902,199 PARKS & RECREATION 5503.02 P&R Adm -OCE 305,965 80,000 385,965 5505.01 Parks Maint S&W 4,663,010 77,950 4,740,960 5507.01 Recreation Div S&W 1,645,816 2,209 1,648,025 5511.01 Hoolulu Complex S&W 568,140 (42,488) 525,652 5513.61 Aquatics Pools S&W 1,167,117 2,266 1,169,383 MISCELLANEOUS 5801.35 Trans to Solid Waste Fnd 15,891,944 (155,000) 15,736,944 5801.52 Tr to Pub Acc/Op Sp Pres Fund 3,970,000 (4,000) 3,966,000 5902.15 Health Benefits 27,500,000 (95,000) 27,405,000 5902.17 Retirement Benefits 22,500,000 (125,000) 22,375,000 TOTAL ADJUSTMENTS (342,400) HIGHWAY FUND PART B ADJUSTMENTS REVISED 2012-13 ADD 2012-13 ACCOUNT NO. DESCRIPTION ESTIMATE REDUCE ESTIMATE EXPENDITURES 5281.01 Traffic Division S&W 2,114,824 0 2,114,824 5281.02 Traffic Division Oce 182,567 (6,948) 175,619 5281.06 Traffic Division Equip 306,152 6,948 313,100 TOTAL ADJUSTMENTS 0 SOLID WASTE FUND PART H ADJUSTMENTS REVISED 2012-13 ADD 2012-13 ACCOUNT NO. DESCRIPTION ESTIMATE REDUCE ESTIMATE REVENUES 3305.06 Glass Recycling Program 135,000 (5,800) 129,200 3305.10 Used Oil Coll/Disp 0 55,000 55,000 3305.72 Electronic Waste Recycling 0 100,000 100,000 3609.11 Transfer From Gen Fund 15,891,944 (155,000) 15,736,944 TOTAL ADJUSTMENTS (5,800) EXPENDITURES 5607.28 Glass Recycling Pgm-St 135,000 (5,800) 129,200 5607.30 Used Oil Coll/Disp-St 0 55,000 55,000 5607.36 Electronic Waste Recycling 0 100,000 100,000 5610.02 Recycling Programs-Cty OCE 4,853,100 (155,000) 4,698,100 TOTAL ADJUSTMENTS (5,800) HOUSING FUND PART K ADJUSTMENTS REVISED 2012-13 ADD 2012-13 ACCOUNT NO. DESCRIPTION ESTIMATE REDUCE ESTIMATE OFFICE OF HOUSING FUND: REVENUES 3301.56 HAP Admin 1,548,181 (128,857) 1,419,324 3609.10 Fund Bal From Prey Year 283,590 148,728 432,318 TOTAL ADJUSTMENTS 19,871 EXPENDITURES 5466.01 Office of Housing S&W 2,266,871 8,309 2,275,180 5902.15 Health Benefits 215,636 9,546 225,182 5902.17 Retirement Benefits 354,068 1,350 355,418 5902.20 FICA Employer Share 174,750 666 175,416 TOTAL ADJUSTMENTS 19,871