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HomeMy WebLinkAboutREP HSSPSC 011 09/05/2012 2010-2012REPORT OF THE COMMITTEE ON HUMAN SERVICES, SOCIAL SERVICES AND PUBLIC SAFETY DATE: September 5, 2012 PLACE: Council Chambers Hilo, Hawaii TIME: 10:57 a.m. Council Chair and Members Hawaii County Council Hilo, Hawaii 96720 Re: Comm. No. 801/13ill 287 Your Committee on Human Services, Social Services and Public Safety, to which was referred Bill 287, reports as follows: Bill 287, transmitted by Council Member Brittany Smart, via Communication No. 801, dated July 26, 2012, amends Chapter 2, Article 25 of the Hawaii County Code 1983 (2005 Edition, as Amended), relating to appropriation of funds to nonprofit organizations. This bill establishes standards for the appropriation of funds to nonprofit organizations providing programs and services which the County has determined to be in the public's interest, and proposes the following amendments: Amends article 25, section 2-136(7) by deleting the definition of "Purchase of service" and any reference throughout this article; amends section 2-1 37(3) relating to Eligible organizations; amends section 2-138 relating to Conditions for grants; amends section 2-139 relating to Procedure for awarding grants; deletes section 2-140 relating to Procedure for awarding purchase of service agreements; amends section 2-142 relating to Record, reporting, and fiscal accountability requirements; amends section 2-142.1 relating to Rules; and deletes section 2-142.2 relating to interim procedures for awarding grants and service agreements. Ms. Smart moved to amend Bill 287 with the contents of Communication 801.1, which would add suggested language from the Department of Finance making a non profit organization who fails to provide a year end report ineligible to receive future grant awards for a period of five years. Ms. Ford agrees that the strong language is warranted. Mr. Hoffmann asked Council Members to remember that the funds are to help those organizations that are trying to help our communities. Mr. Hoffmann's concern is that five years may be too long, and that organizations may have a turn over in staff members and board members. He believes some penalty should be imposed, but the purpose and reason for helping the nonprofits in the first place should also be considered. Mr. Onishi asked Finance Nancy Crawford to come forward. Ms. Crawford stated that it has been a requirement of the Council that if a nonprofit doesn't file a report, they would be ineligible to apply for the next year. Ms. Ford asked Mr. Hoffmann how he would suggest the penalty be imposed, and if a one year penalty after the failure to comply would be adequate. Mr. Hoffmann suggested that an interim HSSPSC Rept. No.: 11 HSSPSC-11 Page 2 September 5, 2012 report be due on January 31 ", and if that is not received they would then be ineligible for the following year; and if they fail to provide a year-end report in August, then they would be ineligible for the following year. Ms. Ford asked Mr. Hoffmann if the non profit doesn't submit the interim report in January and does not submit a year end report, should there be a penalty? Mr. Hoffmann agreed and said it is up to the Committee to deny them future funding. Ms. Smart stated that she would agree to a lower number as long as a strong message is sent to the nonprofits that the year end final report is important as it is taxpayer money that is being spent. At the August 14, 2012 meeting, Chair Pilago asked that the meeting be postponed due to technical difficulties. Mr. Yagong moved to postpone Communication 801/Bill 287 to the September 5, 2012 Governmental Relations Committee meeting. At the September 5, 2012 meeting, Ms. Smart withdrew Communication 801.1 and moved to amend Bill 287 with the contents of Communication 801.2. The amendment would prohibit an organization from being funded for a period of one year and require them to return the grant money to the County if they fail to turn in a final report. Mr. Ikeda disagreed with the measure requiring returning the grant money, but agrees to not allowing future funding for a period of one year. Mr. Hoffmann stated that the amendment captures the intent of his concern, that one year is adequate, and asks for Council to approve the amendment transmitted via Communication 801.2. The motion to amend Bill 287 was approved. Ms. Smart explained that Bill 287 removes all references to "purchase of service" as it is unnecessary with regards to the nonprofit grants. It also expands some of the requirements with regards to auditing, conflict of interest, increases the minimum budget allowance from $900,000 to $1,000,000, requests specific benchmarks, measurable outcomes and accomplishments be stated, changes the date for notifying grantees of their awards and adds a contract clause for contingency relief funds. New sections are added to make sure county funds are being spent appropriately. Ms. Nancy Crawford, Finance Director, came forward and explained that the final reports go straight to Council, and stated further that the department does not review them. Ms. Crawford stated that there is already a provision regarding not funding an organization if they fail to turn in a final report. Her concern is that if "shall" is included in the requirement, there would be no room for discretion or flexibility. Ms. Colleen Schrandt, Legislative Auditor, came forward to explain that there is a difference between the financials required to be submitted with the application and the comparative or performance audit that is being asked of the legislative auditor. Operational or performance auditing is a different type of audit that looks at the outcomes, rather than the financials. Mr. Hoffmann stated that it would be better to say that the County may or shall require the organization to repay all unexpended funds, rather than the entire grant.