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Home My WebLink AboutCOM 0690.000 2012-2014 ;c +, Walter K.M.Lau V.i%• Managing Director William P.Kenoi ' �� • Mayor __ _ _ • Randall M.Kurohara *Pt. �•�`. Deputy Managing Director or ro• County of Hawai`i 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,Hawaii 96740 (808)323-4444 • Fax(808)323-4440 N a February 28, 2014 Honorable Members of the County Council County of Hawai'i 0: 25 Aupuni Street Hilo, HI 96720 Aloha Council Members: `' Transmitted herewith is the Capital Budget for FY 2014-2015 submitted for your review and approval and the Capital Program for the next six years from FY 2014-2015 to 2019-2020. The Capital Budget includes 45 projects requiring a total appropriation of$95.88 million. Funding Sources Capital projects are typically funded by debt (bonds, State Revolving Fund loans), revenue sources (fuel tax, other special revenues), state grants, federal grants or loans, and other financing options (fair share contributions or special financing districts). The Capital Budget presented herein includes capital projects of which about $82.025 million are intended to be funded in whole or part by bonds, $9.215 million to be funded by the State Revolving Loan Fund, $3.36 million to be funded from Federal Grants Receivable, and $1.28 million to be funded by fair share contributions (see Table 1). Debt Service Every year, we strive to present a budget that is fiscally constrained (in terms of prudent debt service planning) and selective based on rational criteria. The Government Finance Officers Association, a professional organization of government officials, recommends a prudent debt service limit to be 15 percent of general expenditures. The lower the interest rate and the greater the revenues, the more can be borrowed while staying within the prudent debt service limits. The proposed operating budget for this coming fiscal year includes debt service for short term bond anticipation notes, which are used to reduce carrying cost and insure that cash will be available for projects as needed. As budgeted, County of Hawaii is an Equal Opportunity Provider and Employer COMM , 69 O m. 3 Ref.To:, F 1 109> Ref.Date, FEB 2 8 2014 Honorable Members of the County Council February 28, 2014 Page 2 the resulting total debt service is estimated at 8.69 percent of the general expenditures. If all debt that has been authorized by the County Council was issued, the debt service percentage would be 12.29 percent of the general expenditures. What is a Capital Improvement Project? A project is eligible for funding from the capital budget if it is a major nonrecurring expenditure, such as: 1. Land acquisition; 2. Infrastructure improvement other than buildings that add value to the land or improves utility (roads, drainage, sewer lines, parking, landscape or similar construction); 3. New buildings or structures or additions to buildings, including related equipment and appurtenances which are integral to the new structure; 4. Nonrecurring rehabilitation, remodeling or expansion of infrastructure and buildings; 5. Planning, feasibility, engineering, or design studies related to capital improvement projects; 6. Information and communications technology infrastructure. Tables Five tables were created to provide a summary of capital budget projects in different formats: Table 1. List of Projects and Proposed Funding Sources includes proposed projects that are requesting funds for this fiscal year, what makes them eligible as a capital project, location, council benefit district, funding source, six-year forecast of funding needs and total project costs. Table 2. Capital Project Eligibility categorizes projects by their eligibility. Table 3. Location of Projects by Council District indicates the Council district where each project is located. 4 Honorable Members of the County Council February 28, 2014 Page 3 Table 4. Council Benefit Districts identifies all the Council districts that will benefit from a particular project. Table 5. Six-Year Capital Program FY 2014-2015 to 2019-2020 lists all projects proposed by an agency and provides the projected funding forecast for the next six fiscal years and total estimated cost for each project. This list includes projects that do not require funding next fiscal year but forecast a funding need within the following five years. Project Data/Financial Impact Statements Proposed capital projects are organized in sections by County agencies. The first document in each section is a Summary of Department Requests for FY 2014-2015. Following the Summary are the individual Project Data/Financial Impact Statements, which include information about the lead County agency, location, project description, Council benefit districts, project consistency with long range plans, impact on operating budget, sustainability focus, project readiness, etc. Fair Share Contributions A Fair Share Annual Report as of June 30, 2013 was submitted to the County Council in January 2014. This document provides information on the total fair share contributions, appropriations, and funds available for capital improvements. At this time, there are $1.28 million requested to fund a project using fair share contributions. However, separate appropriation requests may be approved by ordinance during the year. We have and will continue to strongly encourage the use of fair share contributions to fund capital projects when possible. We ask for your favorable consideration of this Capital Budget and Program. Aloha, ,_1/4...._ A___________:)_ William P. Kenoi, Mayor \\coh33\planning\public\CIP\CIP FY 14-15\March 1 Submittal\Mayor's Message\CIP MAYOR'S LETTER 2 28 14.doc 5