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Home My WebLink AboutCOM 0977.000 2016-2018 • Valerie T.Poindexter Bonnie S.Nims,CGAP Chair&Presiding Officer ;' °q;' Legislative Auditor Council District 1 �o�`•''Y' F�± y_�%.„, : Business Address 120 Pauahi Street • 4rFOFMP ' Suite 309 Hilo,Hawaii 96720 Cn& Mt r of c Z�ai'i OFFICE OF THE LEGISLATIVE AUDITOR ("), 25 Aupuni Street Hilo,Hawai'i 96720 * (808)961-8386 * Fax(808)961-8905 042 Cl website:htt ://hawaiicountov y� p. e-mail: ubliclaonhawaiicountv.gov C' . p ry `C—1 • June 29, 2018 ' cD"< -11c3 m w The Honorable Valerie T. Poindexter, Council Chairperson and Members of the Hawaii County Council Hawaii County Council 25 Aupuni Street Hilo, Hawai'i 96720 Re: Audit Follow-Up Report Dear Chair Poindexter and Council Members, In keeping with generally accepted government auditing standards and the Hawai'i County Charter Section 3-18(d)(3), the Office of the Legislative Auditor has a responsibility to monitor and follow-up on audit recommendations to ensure that audit findings are being addressed through appropriate corrective action and to aid us in planning future audits. This report is to inform you that we have completed our follow-up effort for the audit of Variable Frequency Drives (VFDs) at County of Hawaii Department of Parks & Recreation Swimming Pools” (Report No. 2015-03) dated December 11, 2015. Our review determined that the Department of Parks & Recreation (P&R) has partially implemented the recommendations made in the audit report and are still in progress. Auditors determined that the cost savings associated with the audit team's initial findings has not been fully realized. As a result, OLA may revisit these areas in future audits to ensure that appropriate corrective action is taken. For your reference, this report includes a highlights page that provides background and summary information on the original audit and the completed follow-up effort. Following the • highlights page is a detailed implementation status update for each recommendation. Comm. No. q 17 Ref. To: F�- Ref. Date JUN 2 9 2018 Hawaii County is an Equal Opportunity Provider and Employer • • This concludes audit follow-up work related to this audit. We would like to express our sincere appreciation to the Department of Parks & Recreation personnel who assisted us throughout the audit and follow-up process. If you have any questions, please feel free to contact me at 961-8386. Respectfully yr A onnie S. Nims, 7311 Legislative Auditor cc: Harry Kim, Mayor Stewart Maeda, County Clerk Wil Okabe, Managing Director Roxie en Walt1' Director, Department of Parks and Recreation Deanna Sako, Director, Department of Finance Variable Frequency Drives (VFDs) at County of Hawai`i's Department of Parks & Recreation Swimming Pools June 29, 2018 Report Highlights June 29, 2018 Follow Up Review: Variable Frequency Drives (VFDs) at County of Hawai`i's Department of Parks & Recreation Swimming Pools Status The Department of Parks & Recreation (P&R), Aquatics Division has partially implemented the two recommendations made in our December 2015 audit report. Background A Variable Frequency Drive (VFD) is an electrical device designed to monitor and protect a swimming pool/spa filtration or water feature pump by varying the frequency or speed of the motor in order to provide a specific flow rate. Research has shown that VFDs reduce costs and usage of electricity and energy, potentially recouping the cost of purchasing and installing a VFD in less than a year. The Department of Parks & Recreation (P&R), Aquatics Division is responsible for programs and operation of nine public swimming pools. They also develop and implement a comprehensive water safety program by providing lifeguard services at County swimming pools. Purpose The purpose of the audit was to evaluate the cost effectiveness of installing Variable Frequency Drives (VFDs) at swimming pools countywide. Highlights from Original Audit; In 2006, the Department of Parks & Recreation (P&R) began taking proactive measures by installing Variable Frequency Drives (VFDs) at three of its swimming pools including Charles "Sparky" Kawamoto Swim Stadium, Laupahoehoe Swimming Pool, and Pahoa Community Aquatic Center (PCAC). Despite these efforts, the audit found that, P&R has not had program objectives for reducing costs since Fiscal Year 2012-2013 and has not installed VFDs at any of the remaining six pools. Historic average monthly electrical savings of installing these VFDs ranged from 23% (PCAC) to 63% (Kawamoto). By installing VFDs countywide, we estimated a potential annual cost savings of approximately $122,578. Furthermore, the County could recoup installation costs within the first three years. After this point, all electrical cost savings are in favor of the County. We identified two recommendations for management to increase cost-effective measures at County -owned pools: • Reinstating P&R's previous program measures related to reduction of utility costs at all facilities by implementing green technologies and proactive practices, or at a minimum, develop a new program measure that addresses reduction of cost and/or energy savings. Developing and implementing a written plan for installing VFDs at all County operated swimming pools. Then incorporate the plan into future fiscal years' budget that will reflect the installation of VFDs and reduction of electricity expenditures. Recommendations: Status of Implementation r I kstatu3 Develop Program Measures P&R Aquatics Division reinstated its two Partially We recommend that the previous program objectives. In the Implemented Department of Parks & County of Hawaii (the County) Proposed Recreation reinstate its Operating Budget Fiscal Year (FY) 2016 - previous program measures 2017 Booklet, the Division inserted two related to reduction of utility program objectives: costs at all facilities by . No. 11 — Reduce utility costs at all implementing green facilities by implementing green technologies and proactive technologies and proactive practices, or at a minimum, practices; and develop a new program No. 12 — Reduce chemical costs at measure that addresses all facilities by prudent work reduction of cost and/or practices, education, and energy savings. technologies. Although P&R's reinstated the program objectives under the Aquatics Division, there were no program and/or performance measures to demonstrate that these objectives were tracked and measured. Likewise, we found the same condition in the County's FY 2017-2018 Proposed Operating Budget. However, in September 2017, P&R applied for and received a rebate from Hawaii Energy Efficiency Program for $11,000 for the VFD installation at Kona Community Aquatic Center (KCAC). Plan and Budget for Installing P&R's Aquatics Division has not developed Partially Additional VFDs or implemented a written plan for installing Implemented We recommend that the Department of Parks & Recreation, Aquatics Division, develop and implement a written plan for installing VFDs at all County operated swimming pools. Then incorporate the plan into future fiscal years' budget that will reflect the installation of VFDs and reduction of electricity expenditures. VFDs at all County operated swimming pools. However, in early 2016, P&R installed a VFD at Kona Community Aquatics Center (KCAC). In the next four months, P&R realized a significant electricity cost savings of approximately $2,400 per month, or a 21 % savings. (Figure 1). Furthermore, P&R purchased and installed a replacement VFD for their Laupahoehoe Swimming Pool in October 2017. Our analysis showed that the average monthly electricity cost decreased by approximately $400 (15%) after the VFD installation. (Figure 2). In addition, we confirmed that Kawamoto and PCAC pools currently running with VFDs are continuing to recognize a cost savings. In 2016 and 2017, the average electricity costs were approximately $4,000 (Kawamoto) and $5,000 (PCAC) - about 50% less than without the VFDs. $1,000 $13,000 V $11,000 V d :. $10,000 w 0 O 2 $9,aoo $ l,000 Kona Community Aquatics Center (KCAC) Electricity Cost FY 2015-2016 led S, id J4/J S 1,p 1,p I,S 1s ZS fib' 16. Is 1E yJ6. 1s Source: Data compiled and analyzed by the Office of the Legislative Auditor Figure 1 Laupahoehoe Pool Electricty Costs (May 2017 -May 2018) $3,000 $2,900 WD D was installed $2,700 $2,600 d $z,soo W t $2,400 c $2,300 $2,200 $2,100 $2,000 ✓ " Lid�� 9p I] 4'Tj 94� j y sAbl' V> T' A6, 4 Source: Data compiled and analyzed by the Office of the Legislative Auditor Figure 2 Conclusion While the Department of Parks & Recreation (P&R) has partially implemented the recommendations made in the audit report they are still in progress. Despite the department's efforts, auditors determined that the cost savings associated with the audit team's initial findings has not been fully realized. Specifically, the department could track and measure program objectives related to reduction of utility costs and develop a written VFD implementation plan. As a result, OLA may revisit these areas in future audits to ensure that appropriate corrective action is taken. The Office of the Legislative Auditor would like to thank P&R leadership and staff for their cooperation during our follow-up effort and for their dedication to public service.