Loading...
HomeMy WebLinkAboutMIN FC 2019/03/12 2018-2020Committee on Finance 5'h Session I lawai'i County Building 25 Aupuni Street I filo, I Iawai'i March 12. 2019 CALL TO The regular meeting of the Committee on Finance was called to order at ORDER. 10:12 a in , in the Council Chambers, Hilo, by Ms. Maile Medeiros David. Chair. ROLL CALI Present: Ms. Maile Medeiros David, Chair Mr. Herbert M. "Tim" Richards, Vice Chair Mr. Aaron S Y Chung, Member (came in later) Ms. Karen Fell,, Member (came in later) Mr. Matt Kaneali'i-Kleinfelder, Member Nis. Ashlev L. Kierkiewicz. Member Ms. Susan L. K. Lee Lo)', Member Ms Rebecca Villcgas, Member Absent: Ms. Valerie'f Poindexter, Member STATEMENTS The Chair directed the Committee to proceed to the next order of business, FROM'FHE Statements from the Public on Agenda Items. PUBLIC ON AGENDA ITEMS. (There were none.) C'OMMUNI- The Chair directed the Committee to proceed to the nest order of business, CATIONS. Communications. Comm. 10.6: REPORT OF CHANGE ORDERS AUTHORIZED: JANUARY I — 15, 2019 From Finance Director Deanna Sake, dated February 5, 2019, transmitting the above report pursuant to Hawaii County Code Section 2-12.3. Vote on Comm. 10.6: Mr. Richards moved to close file on Comm. 10.6. Filed Seconded by Ms. Vdlegas and carried by the following voice vote: Ayes: Committee Members Leff. Kaneali'i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David — 7 Noes: None. Absent: Committee Members Chung and Poindexter - 2. Excused: None. FC -5 March 12, 2019 Comm. 10.7: REPORT OF CHANGE ORDERS AUTHORIZED: JANUARY 16 — 31, 2019 From Finance Director Deanna Sako, dated February 19, 2019, transmitting the above report pursuant to Hawaii County Code Section 2-12.3. Vote on Comm. 10.7: Mr. Kaneali`i-Kleinfelder moved to close file on Filed Comm. 10.7. Seconded by Ms. Lee Loy and carried by the following voice vote: Ayes: Committee Members Eoff, Kaneali`i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David — 7. Noes: None. Absent: Committee Members Chung and Poindexter — 2. Excused: None. Comm. 11.4: REPORT OF FUND TRANSFERS AUTHORIZED: JANUARY 16 — 31, 2019 From Controller Kay Oshiro, dated February 1, 2019. Vote on Comm. 11.4: Mr. Richards moved to close file on Comm. 11.4. Filed Seconded by Ms. Lee Loy and carried by the following voice vote: Ayes: Committee Members Eoff, Kaneali`i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David — 7. Noes: None. Absent: Committee Members Chung and Poindexter — 2. Excused: None. Comm. 119: SECOND QUARTER REALLOCATION REPORT: OCTOBER — DECEMBER 2018 From Human Resources Director William V. Brilhante, Jr., dated February 7, 2019. Vote on Comm. 119: Ms. Lee Loy moved to close file on Comm. 119. Filed Seconded by Mr. Richards and carried by the following voice vote: Ayes: Committee Members Eoff, Kaneali`i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David — 7. Noes: None. Absent: Committee Members Chung and Poindexter — 2. Excused: None. Page 2 FC -5 March 12, 2019 Comm. 149: FORMATION OF AN AD HOC COMMITTEE: FISCAL YEAR 2019-2020 OPERATING AND CAPITAL IMPROVEMENT PROJECT BUDGETS From Council Member Ashley L. Kierkiewicz, dated February 22, 2019, requesting formation of an ad hoc committee to investigate issues relating to the upcoming Budgets, and identify methods to increase efficiency and reduce costs. Motion to Close File: Ms. Kierkiewicz moved to close file on Comm. 149. Seconded by Mr. Richards. CHR. DAVID: Ms. Kierkiewicz, go ahead. MS. KIERKIEWICZ: Thank you, Chair David, if you will indulge me. You know, over the last few years, we've seen increases in all taxes under the County's authority: real property, fuel tax, and vehicle weight tax. In the few short months that I've been a Council Member, we've seen sewer fee increases, and we're asked to up the GET (General Excise Tax) surcharge to the full half percent. A little over a week ago, on March 1st, the Council was presented with a proposed $573 million budget, $55 or so million more than last year. It's a 10.7 percent increase over the current fiscal year. Granted, and I'm very thankful, that there is increased funding for Police personnel in Puna and Ka`u, but our budget is still massive. That said, I believe that creating an ad hoc committee is a tool that we Council Members have in our toolkit. We can investigate a very defined scope of work, which is outlined. The process is outlined in Rule 7 of our Rules of Procedure. This is not an uncommon practice. Just last month, we formulated an ad hoc committee to review grant-in-aid applications. Four Council Members will meet and go through a rigorous process to decide how the $1.5 million is awarded. And I've reviewed Laserfiche, there are more than 800 documents regarding an ad hoc committee. Lots of different committees have been formed in the past, including committees to investigate Puna connectivity between mauka and makai, emergency routes, even ad hoc committees to discuss the Tax Review Working Group reports. All of these topics have a fiscal impact on our County and our budget. What I'm proposing is not a new idea. It's been done in past. The last time this was done was a decade ago, 2009, remember that? The Great Recession. A budget ad hoc committee was proposed by then Council Member Fresh Onishi. The members of that ad hoc committee included Pete Hoffman, Fresh Onishi, Donald Ikeda, and Dominic Yagong. Like I said, they were facing the Great Recession then, and that's when furloughs were on the table. And right now I would say that we are in dire straits. Now more than ever, we need to figure out Page 3 FC -5 March 12, 2019 where we want to go so we can make pressing short-term decisions with more confidence. Council Member Richards has a saying that he often likes to state, right? Doing the same things over and over. And expecting different results is the definition of insanity. I don't want to go insane. You know, if the community likes the same playbook of let's tax and spend and increase budgets, then let's keep doing what we're doing. But I think if we're all more open to being more fiscally responsible and being strategic about where we invest, when and how, these are the kinds of recommendations, key word "recommendations," that can be put forward by an ad hoc committee. An ad hoc committee for the record, we all know this, we read through our Rules but investigates and reports findings back to the full Council for further and more robust discussion. Recommendations can be adopted or dismissed by the full Council; and with the defined scope of work, the ad hoc committee is obligated to stay on -point in their investigation and queries. So, I'd like to offer -up a list of a proposed scope of work for a budget ad hoc committee to study the proposed Operating and Capital Improvement Projects Budget that has been recently delivered to us. The first scope of work is to review the priority of County services. We have a very defined mission, so making sure that all of the services we provide as a County are in line with that mission. Let's take a look at existing, vacant, and desired County positions in partnership with department heads and HR (Human Resources) personnel. I think there are some key positions that we should look at and really invest in, including statisticians. We are in a very data -driven society, and in order or to take advantage of Federal funds, we need a grant writer on staff, but in order to be effective, we need data. These are the kinds of positions that we need to start thinking about having for our County. Let's look at our debt policy, debt repayment, and budget impact of future bond issuance. Can we be more aggressive in leveraging our short-term bonds? I'd like to overlay the proposed budget as submitted from the administration with departments' supplemental requests which are not included in the proposed budget that the administration delivers to us. I'd like to consider cost saving measures to reduce or eliminate any possible deficits. Let's take a review of our assets and liabilities. Can we identify ways to increase our revenues? How can we leverage our assets and decrease liabilities? My favorite, how do we turn a liability into an asset? Page 4 FC -5 March 12, 2019 I'd like to conduct a thorough and analytical review of the annual CIP (Capital Improvement Projects Budget), including project priorities as deemed appropriate or necessary. I have asked the Planning Director, Michael Yee, to indulge the Council and talk more about how we can explore ways the Council can work in partnership with the community to set priorities and really direct funds as it relates to Capital Improvement Projects. I'd like for this body to put forth a recommended vision for strategic investments. What are our short-term and long-term priorities? Can we also identify low, medium, and high priorities within those timeframes? You know, recently I was at a Puna CDP (Community Development Plan) Action Committee meeting, where the General Plan and CDP review process was presented to the community. I found it very interesting, and how the Planning Department is aligning both of these documents. What I found to be really very, very interesting was how with review of four various CDPs, the Action Committee over a five-year period, the Action Committees would take a dedicated look at a specific industry; for instance natural resources. Then the following year the conversations would be pointed around economic development; the following year, placemaking; the next year, Capital Improvement Projects. And I wonder, can we as a County create strategic investments that align with the actions we set out in these long-range planning documents? That makes a lot of sense to me. I think this ad hoc committee could also explore incentives for developers and community groups to really take action on these plans we've crafted. Thinking along the line of like a 201H application or an opportunity zone. How do we create incentives to attract the investment that we need to really move our County forward? And finally, the last thing I'd like for the ad hoc committee to do is to review Article 10 of our County Charter which is related to financial procedures. Let's take a look at what's in our Charter. Right now, the Commission has convened and is reviewing potential amendments, and I think this ad hoc committee could put forth potential amendment recommendations for the Council and the Commission to consider. With that, I just want to say that it's worth exploring. Creating this body, I think, it will enable us as a Council to conduct a longer, a deeper examination of our financial picture, and really allow us to make fiscally responsible decisions for right now and into the future. So with that, I yield the floor. Thank you, Chair. CHR. DAVID: Thank you, Ms. Kierkiewicz. Mr. Richards and then Chair Chung. Page 55 FC -5 March 12, 2019 MR. RICHARDS: Thank you, Chair; and thank you, Council Woman Kierkiewicz, for bringing this forward. It's no secret that when she initially said that she was thinking about doing this, I was very supportive of hearing about it. It's also no secret that I have been a very strong supporter of an ad hoc committee concerning our budgetary process. I think—some things that she has touched upon and I am intrigued by it, is we're facing a crossroad or a fork in the road on how we're going to proceed going forward. I think it was well -summarized by her statement; we can do the same thing we've done previous, tax and spend, tax and spend, which is a way it will—it functions. I won't say it works well, but it functions. But that'sI don't think where we really should be focusing our efforts. In order for us to be a truly successful County, we must be dynamic. We must have a dynamic economy. We must have a dynamic culture here. If we don't sieze the opportunity to make a difference, I think we're going to be short-sighted. The tax and spend is a method that is again, short-sighted. It doesn't plan for the long-term future. We've already started talking about things like this. Council Woman Kierkiewicz mentioned the sewer fees. That's a stopgap method that increases revenue. Takes care of the sewers for a short time, but we're actually not planning for the long-term future and the long-term success. What we really have to do, and again this is just reiterating things that I've said in the past, our concern is figuring out how to stimulate the economy and bring that forward. I went back and reviewed our tax rates, and what the history of raising the tax rates were. If you go back through their—between 1990 and I think it was 2003, we didn't touch the rates at all. And then come forward, there's some jumping up and down. You mentioned theI won't say recession, but the financial collapse, how we actually reduced our tax rates, and then we've kind of bounced along. Most recently, we had a tax rate increase in 2017; previous to that, was 2013. What we need to do is figure out, and again Council Woman Kierkiewicz touched on this, is the investment in our County. If we don't have the investment in our County, we won't have the growth in our economy that we need. It's not about increasing the rates. It's about increasing the tax base, which is having those ongoing entities, whatever they may be, business or residential, whatever the case. So then it comes back to how do we best champion that? So I think what we're talking about is looking to a long-term plan, and that's when we come with sitting down and working through all the metrics. When the proposal for the GE tax came before us, increasing by a quarter percent, I was not supportive of it. I'm still not supportive of it. With no metrics—now we finally have a budget to compare it against. If we look at our budget—when I Page 6 FC -5 March 12, 2019 took office, it was $461 million. It is now projected to be $573 million. That's a huge increase. It's 25 percent increase since I've been in office. Discussing with other councils and other counties, just back from the NACo (National Association of Counties) meeting, yes they're seeing an increase, a couple of percentage points. Maybe five percent. And when they hear about our budget, they're shocked. I'm not saying we don't need funding. I'm not saying we don't need infrastructure. In fact, that's nationally one of the biggest concerns is infrastructure nationwide. But tax and spend, tax and spend, without a conscious and conscientious approach, and methodical, so we can get better bang for the buck. I think we have to change. I know we have to change how we're approaching our budgetary process. So I'm fully supportive of the ad hoc committee and getting a few people to buckle down and look into how we might springboard our economy, really take it forward. Because it's not about just collecting money, it's about figuring out how to make things better. Government, I firmly believe, is here to facilitate going forward. We're supposed to help get things running. We're supposed to lift things up. (timer beeps) Chair, may I have a moment more? CHR. DAVID: Yes. And then I would like to go to Mr. Chung after you're done. MR. RICHARDS: Yes. CHR. DAVID: He has to leave. Thank you. MR. RICHARDS: I will be quick. We're supposed to facilitate and help things grow, and if we don't do that, we're going to be short-sighted for our County as a whole. So with that, I yield. Thank you. CHR. DAVID: Thank you, Mr. Richards. Mr. Chung. I mean, Chair Chung, sorry. MR. CHUNG: Thank you. Let's go back a year, okay? Actually, Mr. Richards had brought up this idea of an ad hoc committee. And I think there were several on this body who were actually warm to the idea but wanted just a bit more specificity. So now we are one year hence, and then Ms. Kierkiewicz, newcomer, has brought this up again. Maybe in consultation with Mr. Richards, I don't know. You know, having thought about this thing, I still don't see total specificity right now, but I don't think that's necessary. We have open up dialogue with former Chair, of Maui County, Ricki Hokama who has actually devised quite a system of Page 7 FC -5 March 12, 2019 reviewing the budget there on their island. I don't know if we want to go that far. But, we don't need specificity right now. I've come to the conclusion that if we do form an ad hoc committee, it's going to be a work in progress. and it's going to be something that we develop as we go along. It might not be perfect, but at least it provides us the comfort level that we want, and it also provides the comfort level that the public demands. I mean, if you lookI think it was quoted in the newspaper saying that even among those people who were in favor of the General Excise Tax increase, or any other tax increases, they still seem to have wanted more transparency in the way the budget was formulated. Look at how our system is set up. In March, we get the first budget from the administration, okay? But if life has shown us anything, that thing can change when we amended budget comes back to us in May, and at that point, we have only absent a month-and-a-half to adopt that amended budget. And with all of our agendizing requirements and everything, it just wreaks havoc on us. I guess—who was there? You were there, Mr. Richards, Ms. Eoff, myself, and Ms. David were there. When the amended budget came in two years ago, it included a tax hike, and that wreaked havoc on our process. I mean, our good sense probably would have told us that was probably coming down the pipe, but we weren't really too sure. So this, I think, ad hoc committee, as imperfect as it may be at the outset, will enable us to get more information steadily, until such time that we get the amended budget. Hopefully in the future, maybe two, three years down the line, we will streamline that process to where it becomes the standard method by which we review the budget. And it allows to take a more active role in all of that. I think for the newcomers—it's really hard to explain this. It's very difficult to explain how difficult it is to toil with an amended budget right when you only have about a month-and-a-half to deal with it. It's very, very difficult. So, I applaud Ms. Kierkiewicz. And, Mr. Richards, you actually saw it last year. I think it's a good way to go. But I don't think the public should expect perfection. It's going to be a work in progress. Thank you. CHR. DAVID: Thank you, Mr. Chung. Anyone else? Ms. Lee Loy, go ahead. MS. LEE LOY: Thank you, Chair. This is a new way forward. This is a paradigm shift on how we do business with our budget and providing services to our constituents. And so I whole -heartily support this idea. I do want to walk back to a comment that Mr. Chung just mentioned, which is it might be imperfect, but we will be getting good information. And this body Page 8 FC -5 March 12, 2019 knows that I have stood firm behind "Good information helps us make good decisions." And when I looked at what Ms. Kierkiewicz identified as possible outcomes or deliverables for this ad hoc committeeI heard "Review the priorities of County services and ensure that we are providing adequate services to our constituents." I heard "Evaluate existing positions and vacant positions and ensure that we are getting what we pay for from these positions." For our freshmen colleagues, I will admit the budget cycle was challenging. It's overwhelming. As Mr. Chung described, you have a very tiny window to take a look at what the requests are and make a good decision. One thing I learned through the process is there are other things that the department agencies get that we don't see, which is a supplemental budget. To better understand some of their decision-making is not presented. It's simply not presented to us during the budget cycle. The biggest challenge I found in my first two years was as we go through these agency reviews, I honestly don't know if I'm asking the right question. To get to the results that we want starts with asking the right question of each and every department. As Mr. Chung said, "It's chaotic." You're working so hard to listen to what the agency requests are and evaluate them on a number. But, my challenge was the return on investment. I don't know if we were truly putting enough money into these respective agencies that would provide the uplift for the communities and the constituents that we serve. The other thing that I heard Ms. Kierkiewicz mention is leveraging. Leveraging resources. Leveraging our County assets. We need to think this differently. We have enormous opportunities out there to leverage: public, private, nonprofit. And we've got to figure out a smarter way to do that. Just yesterday, I heard a conversation about lift zones and how that would provide shelters and homeless yeah, wraparound services for our homeless population in rural communities. We are the Big Island. We are the most rural island. And so when I hear these opportunities, I'm trying to strategize how we get to dovetail this into and blend it into the services that we have right now. I think I've spoken enough. I applaud Ms. Kierkiewicz for the innovative thought and the opportunity to really shift how we do something differently here in Hawaii County. I will be supporting the ad hoc committee. I stand ready to serve on it as we go through this process. You know, whoever decides to sit on it or wants to sit on it, we can have that discussion further. But I do stand ready to help. I yield. Thank you, Chair. CHR. DAVID: Thank you, Ms. Lee Loy. Council Members, anyone else? Ms. Eoff, go ahead. Page 9 FC -5 March 12, 2019 MS. EOFF: Thank you, Madam Chair. I agree that we definitely would benefit from investigating many of the priorities and items that Ms. Kierkiewicz mentioned earlier. My concern is that was a very aggressive approach, and I don't know whether there's time to even to look into all of those items that you mentioned. The two concerns I have is, how long would all of that take, and is that clear enough to meet Number 3 on our Rule 7, the Scope? "The scope of investigation and each member's authority must be defined at a meeting of the Council." I mean, we're here at a meeting, and I don't know whether I fully understand how you would plan to investigate all of that and how long of a time. Because I know like our Legislative Auditor is tasked with many of these kinds of items, and they have prepared reports but those take years. So I'm just wondering if maybe someone from Finance could help us understand, if some of these objectives could be met in a shorter amount of time. Because I really would love to have better information and help to understand the process that we would be going through. And if an ad hoc committee accomplish some of that and if we can meet the standards required of us to form a permanent action group, I think we need to maybe state that a little bit more clearly for the record. I know Mr. Chung said it could be a work in progress, but I think that would maybe contradict our rules which require us to fully state the intent of the permanent action group and then come through with the actual report to the Council. (Note: At this time, Finance Director Deanna Sako came forward to address the members of the Committee.) MS. SAKO: Good morning. Deanna Sako, Finance Director. You know, I'm really not sure I got everything down. I was writing as fast as I could, but it wasn't in writing. So some of things why it seems like if falls under the purview of the budget, some things may have a longer term, you know, type of idea that may be better under a different name. But, you know, this is the Council's ad hoc committee, and it's up to the Council how they want to carry out the work and get the answers to these questions. MS. EOFF: Well, I'm willing to keep listening on how we can do this. I'm sure we'll probably need some more discussion and advice. Could I ask Ms. Kierkiewicz a question then? CHR. DAVID: Ms. Kierkiewicz, would she? Thank you. Go ahead. Page 10 FC -5 March 12, 2019 MS. EOFF: So are you envisioning that a committee would then sit down with Finance and take the time to figure out how to bring the information forward? What were some of your? MS. KIERKIEWICZ: I'm so glad you asked that question. Because like I said, I spent a lot of time on Laserfiche to see how previous Council Members had put this together. So taking a look at what Council Member Fresh Onishi did, he put forward a much simpler communication than I did, just asking for a discussion around forming a budget ad hoc. And it's my understanding that at a committee meeting, the scope of work, similar to how I presented, was also discussed among Council Members. So my thought was having presented all of that to you, and also hearing that there are some other areas in which we need to consider—Chair Chung pointed out perhaps consulting with other counties, such as Maui, to understand their process. I also heard there are issues with public input and transparency, so that could also be something that the ad hoc committee investigates. It doesn't need to just be an investigation for just this current budget. We can set very short-term priorities in order to meet the deadlines for the upcoming fiscal year budget, but we can make it an exercise where we have medium and long-term priorities that really span the rest of the year. My thought was I could put forth at our Kona Council meetings, at Finance, a fleshed -out version of what I have presented to you, to the Council, to our colleagues, and assign a timeline so that everyone is very clear on the amount of work that this body will undertake. I know it's aggressive, but I think we have to act bold now. We've got to shoot for the moon, right, so that we land among the stars. I'm not afraid to roll up my sleeves and put in the hard work to get information out. I certainly want to make sure that we are working with Director Sako and Mr. Hunt on this effort. I know that Deanna actually did participate when she was Deputy Director in the budget ad hoc. So we certainly want to make sure that we're taking advantage of all of our friends here at the County, to put forth some great recommendations together. MS. EOFF: Do you remember how they stated the scope of their work for their ad hoc committee? MS. KIERKIEWICZ: It was actually very simple. A few of them I actually borrowed. One was review priority of County services. The next was investigate existing and vacant County positions. It was very simple and clear. I felt that I was much more detailed in what I've actually provided then what was offered up in the past. MS. EOFF: Okay. Well, thank you for brining that to our attention. So what you're saying is between this meeting and the next meeting you would like to Page 11 FC -5 March 12, 2019 more clearly state that the process, the timeline, and what would be investigated. Or, what? MS. KIERKIEWICZ: Yes. And I was just looking at the precedent that was set previously. A simple communication was offered up; a discussion on the floor in which the proposed scope of work was presented. And from here, after having heard from the rest of my colleagues, putting that down into paper, articulating it via a communication that can be discussed more further in Kona. And assigning some priorities and deadlines with regards to, how do we make sure that our recommendations are in place in order to meet the deadlines that are established for our budget? MS. EOFF: Thank you. And I'll yield at this point. Unless, you want to chime in. MS. SAKO: I think the concern always have is not always understanding the Council Rules and how the ad hoc committees work in terms of relation to the upcoming budget reviews with the departments. You know, I kind of get stuck on the creating the committee, going off and doing the work; and then the committee having to report back, and then not hearing or discussing the report at that meeting but having the next meeting before they can discuss it. So having all of that completed, or not contradicting or not impeding the budget reviews that are already scheduled for April 16 to 18 or whatever those dates are. So I'm just not getting the whole sequence yet, and maybe I will after the next communication. MS. EOFF: I agree that's going to be challenging because there are different deadlines, hard deadlines that are set. So for us to accomplish something either in between those things or in time to make a difference, that's I guess what we need to talk about some more. Thank you for stating that. I yield. CHR. DAVID: Thank you, Ms. Eof£ Mr. Richards, go ahead. MR. RICHARDS: Thank you, Chair. I think what Council Woman Kierkiewicz is almost saying, is establishing an ad hoc to explore the ad hoc, and report back with the details of the ad hoc. Long story short, we don't need to do that. But I do appreciate what she's trying to do. The intent is to fix something. We don't have a very good budget process here. If anybody says we do, I'm going to argue vehemently against you. We have an opportunity to make a difference. We've been having this conversation for the last two years now. The first year, we were too freshman to have the argument, So, I've been arguing for two years now on this. I think the opportunity, and I fully appreciate Council Woman Kierkiewicz's approach that doing this we're having the talk story right now. Proposing the Page 12 FC -5 March 12, 2019 potential scope; that's what this is for, to have this conversation. The governance under Sunshine Law mandates that we have this conversation like this. It's cumbersome, but that's what we do. But now we have a potential for some scope. With that, we can more articulate that. And going forward, there's two ways to approach this. Either Council Woman can take this and come back with a firm proposal for an ad hoc, and I'll happily work with her on it because we're allowed two people to work on it. Or, we can establish the ad hoc now and report back with the scope of the ad hoc and approve the scope at our next meeting in Kona. So there's two ways to approach it, but the end result will essentially be the same. But, the intent is to talk story. Identify some potential scopes, we have that done. There's still going to be some more—report back into two weeks. Identify that specifically and go forward. Don't think that I'm a cavalier in thinking that this would be simple and that the timelines will be easy, but I have yet to work on the budget where it's been simple and easy. The intent is to have a different way of discussing this thing. Because we're going to do the same thing again. Chair, you heard me say, I feel we're going to make a mistake. I don't want to make a mistake again. So, I'd like to move forward with this. At this point, I yield. CHR. DAVID: Thank you. Ms. Lee Loy, go ahead. MS. LEE LOY: Thank you, Chair. And I see Ms. Kierkiewicz writing feverishly her notes here. I think what she's also asking for, is what is an actionable item that could be kind of proposed as a scope and what would be investigated? So after listening to the rest of my colleagues and kind of what Ms. Kierkiewicz's vision is, if I could propose or suggest that the ad hoc in one of its measurables or deliverables look at the CIP as we set priorities, and then kind of articulating or defining them as low, medium, or high priorities as we apply them against the different budgets. I think my second one would be that's a tough one. I think, how we leverage. How we leverage our County assets along with our budget, and then other public-private partnerships. That would be my suggestion. She didI think I've listed seven different ideas that she had. I would want us to tackle maybe two or three at a time, and maybe even set them as low -hanging fruits so we could build some momentum. And then, demonstrate to the public that we really are just working harder at our budget process to provide good services. That would be my suggestion. I yield. Thank you. CHR. DAVID: Thank you. Anyone else? Ms. Kierkiewicz, go ahead. Page 13 FC -5 March 12, 2019 MS. KIERKIEWICZ: Thank you all for your feedback. I do agree with Ms. Lee Loy, I think it behooves us to be strategic on how we tackle this. Because the budget's quite a beast, and I'm a very ambitious person. I've got a lot to do. There are nine priorities that I had outlined, and so I am happy to make the determination as to what are the highest priorities and then kind of tier them, and then present them to the Council at the Kona meeting. I do agree with Mr. Richards, that I would like to forward with establishing an ad hoc committee; and that is a power that the Chair of this Committee—Chair David has to allow. So I'm really hoping that everybody on the Council, my colleagues, see what we're trying to do, which is to really work hard for our community. So with that, I yield the floor. CHR. DAVID: Thank you. Anyone else? Mr. Kaneali`i-Kleinfelder. MR. KANEALI`I-KLEINFELDER: I commend everybody for their work on this. I think it's never a bad time to jump in and really review what's been happening and where we sit.. Nobody can say that's a bad idea. I would like to see a little bit more detail and something that I can actually hold in my hand that says what we're going to do, that would make me comfortable. And I want to mention the Real Property Tax numbers are given as an estimate, and we based our budget on that, and then the Real Property Tax numbers come in, in an actual number after the budget is proposed. I learned that in my last meeting with Lisa Miura. I asked her about it, and she said that it could be changed. So we could actually have the real numbers before the budget is proposed, which I felt would be helpful. So, that would be my recommendation. Maybe possibly looking at that to see if we could change— MS. SAKO: I just want to clarify one thing. It is before the March 1" budget, you're right, we have the proposed numbers. But by the May 51h budget, that's the whole purpose of having the two, is we do have the final numbers at that point. MR. KANEALI`I-KLEINFELDER: Yes. To me, it makes sense to have it beforehand. It sounds like it could be. It is a possibility; it just needs to—some timelines, it could be shifted so that we could meet different deadlines. I understand that would be a headache. But it didn't sound out of the ordinary or extreme, just a little bit of maneuvering. So that would be one area I felt would be helpful for everyone. I am a freshman, and I would be wary of having too many freshmen on the ad hoc committee because I would like to have ita very strong presence from Kona and from Hilo. I don't mean Kona and Hilo. I just mean east and west, so it's very Page 14 FC -5 March 12, 2019 clear that we're not prioritizing to two different sides of the island, as well as have a very good depth ofa very good look on what we're doing, and make sure we're not being one-sided or that the experience necessary to look into something like this is not being given. That would be my concerns for the ad hoc committee. Otherwise, I'm in unison with you guys. CHR. DAVID: Thank you, Mr. Kaneali`i-Kleinfelder. Ms. Villegas, go ahead. MS. VILLEGAS: Hi. Yeah, I'd like to kind of echo what Mr. Kaneali`i- Kleinfelder said. In the opportunity for us to create a new paradigm, it does seem incredibly ambitious to tackle all of these issues. I guess being a freshman, part of me wonders if some of these things are really in our scope of work as Council people. But I always want to be forward thinking, and for opportunities to transition the County from being kind of in a position of being behind the eight -ball, instead to get ahead of it. However, I guess, I—every time it's brought up, for me there's that tickler of I just want to make sure that the public and the community understands that our County budget, outside of salaries and wages and retirement funds, really only grows about three percent a year. So there are a number of things that even within an ad hoc committee, we can review it, but we have no control over it. So those are just the things that I would like to see improvement. I would like to learn more about the budget. From my prior work in the private sector, it was kind of a part of the whole budget process when the different department heads come and present and tell you kind of a story behind the numbers. But I get that the timeframe is difficult to get a real—it's different when you work in the private sector because you kind of know more about what that department's doing. And if this provides an opportunity for those of us who sit in this position on the Council, to be more integrated and collaborative and work more closely with an understanding of those in administration, I feel that can only benefit the County, the Council Members, the administration, and in the long run the constituents. That tickler always kind of jumps out at me. I just want the public to understand that as a County, we're not increasing our budget on purpose, in that capacity. There are a number of decisions that get made, and some of the benefit is those decisions benefit that people that live and our constituents and work for the County here. But it does make it more challenging to balance a budget when the pieces of the pie—we're not the only County and we're not the only State nationally going through some of these challenges with the cost of government. And not just the services, but of the people in the government exceeding some of the income. So, I love the concept of thinking outside the box. Let's get creative, and let's collaborate, and let's connect public, private, and nonprofit enterprises. Page 15 FC -5 March 12, 2019 However, I just out of respect for the administration and all of the work that you guys do on that budget, to honor that there has been a lot of creativity and buckling down there, and I recognize that. So it will be exciting and interesting, and a learning curve to figure out—and for myself personally, to learn more about where everything goes, how it goes, where it goes, why it goes. I mean, our pool just broke down in Kona, and boy is the community freaking out. But I was heartened to hear that the monies are already there to fix it, so it's just the timeframe. So, thank you for you time and energy. Thanks for thinking outside the box. We'll try to keep up with you, Ms. Kierkiewicz. I yield. CHR. DAVID: Thank you, Ms. Villegas. Ms. Kierkiewicz, go ahead. MS. KIERKIEWICZ: I just wanted to address a couple of things that my colleagues—my fellow freshmen Council Members brought up. I do feel that the scope of work that I have provided today is very much in line with the Council. We have to review and approve the budget, so I think it's our responsibility to look at all of these areas. I do think, when Mr. Kaneali`i-Kleinfelder pointed out how and when the budget is crafted in relation to real property tax, this represents an opportunity to take a look at our Charter. Do we want to tee things up differently with timelines so that we're getting the possible information when we need it to make these kinds of decisions? In terms of the make-up of the ad hoc committee, I was hoping to serve. I was also thinking it would be great to get someone from the Finance Committee leadership, so potentially Mr. Richards because he's also very passionate about this. I also do recognize that we are one Big Island, so having representation island -wide is very important. I would like to, you know, extend the invitation to Ms. Eoff to serve as she has been in the Council for a number of years, and I think I and the ad hoc committee would really benefit from her mana`o. We could keep it at three. There is another seat that is available. I certainly don't want to overwhelm anybody that's currently service on the GIA (grant -in -aide). I also thought Chair Chung might be an interesting choice because he has the most time on the Council, having already served a full eight years, and now I believe on his second go -around as a Council Member. Third year, so eleven years on the Council. A lot of historical institutional knowledge there that I think would be very beneficial. I have no further comments, and I just ask for your support, Chair, in allowing us to form an ad hoc. I can commit to taking all of my colleagues thoughts and feedback into consideration and defining a very clear scope of work and timeline for action to be presented at our next Finance Committee meeting in Kona. Page 16 FC -5 March 12, 2019 CHR. DAVID: Thank you, Ms. Kierkiewicz. Anyone else before we close discussion? Okay. Then first of all, I'd like to thank the Council Members for their discussion. This proposal has now taken a different approach from what we've seen in the past. I agree that the various items that are listed to be under the purview of the ad hoc committee is quite extensive. I'd like to see—what you're going to do, is come back according to our rules and identify a specific scope for each investigation—and each member—what each member will be assigned to. I cannot. I cannot see all this being at the same time because we don't have the time. It's so comprehensive in order to do a good job to do all of these at once. So, I like the idea of gettingoh, I like Ms. Lee Loy's idea. At least two or one Council Member specific assignment of what they are going to be investigating in this ad hoc committee. If it's three, then each Council Member gets assigned one topic to come back with us, whatever is important. This way it's not a general blanket ad hoc committee to just discuss budget because of all of the work that Finance has done, and some of the answers that we're seeking is already contained in our budget. I really look forward to the departmental reviews because in that sense I think some of the things that you list on your priorities would be great to advise the departments ahead of time so that they can come back to us during the reviews and answer some of these questions. So while you're considering focusing your ad hoc scope on maybe two or three specific priorities, I'd like to suggest that the others could be interacted with the departments, so when they come before us for their reviews, they will come ready and prepared to answer those questions that we all might have as Council Members. Another thing, because this is basically different innovative way that is being presented here, I think the only—yeah, the only concern is the specificity of the scope of each ad hoc committee member. Because I for one feel that this whole budget process, and all the information that really is as good information that we want to get, I really don't think that I'd like to keep the public and open government discussions about budget outside of their purview, except for the specific task or the scope for this ad hoc committee. I think during budget reviews, the department heads will be here; and also, the community and the public will have their opportunity to weigh in because as much as we—we're charged to be fiscally prudent and efficient. I think our constituents of this County have some good—must have an opportunity to weigh into this whole process, as well. If you come back on our next meeting with a specific priority and scope of each member, that might be some additional discussion and fine tuning at that time. Given that, Mr. Clerk, could you just generally estimate? Say an ad hoc Page 17 FC -5 March 12, 2019 committee is formed with specific purposes, what is the timeline that we would have for the ad hoc committee to meet, come back with recommendations that would be realistic in this budget process? If we're identifying it in our next meeting in Kona, ad hoc committee, there's no limit of how often they can meet, right? Then they would—yeah briefly, timeline? MR. HENRICKS: Well, it's a little difficult because I'm hearing—like you said, it's a veryI don't want to use any adjectives, not my job. But that being said, if you're looking at making distinct recommendations for this Operating Budget, of course that could be problematic because it's a three -meeting process. I don't think this counts as one of the meetings because I don't believe you can establish the committee today because you have yet to define the scope. So one meeting to do that, define the scope and the membership; a second meeting to present recommendations, sit, no discussion at all. This is like a marination process to get it out there in the public and to allow any other stakeholders an opportunity to review the work of the committee, including the rest of the Finance Committee members; and then a third meeting, then kind of to delve into those things. It's arguable as to whether that third meeting can actually be actionable meeting, where you're looking at something that you want to actually provide legislative action on. I think that we've always erred on the side of caution, and so the third meeting is maybe not for that, but that already belongs to itself. I mean, all I can say is it's a three -meeting process at the least, and I don't think that this counts as one of those meetings. So, three meetings going forward. So month-and-a-half minimal after the committee is established. CHR. DAVID: Thank you. After the committee is established. MR. HENRICKS: Correct. CHR. DAVID: And then in the meantime, there's the budget reviews that happens in April, I believe. MR. HENRICKS: Yes. CHR. DAVID: That was my concern as far as timeline goes. Ms. Lee Loy, go ahead. MS. LEE LOY: Yeah, thank you, Chair. And I think what we have before us is a motion to close Communication, what number, 149. CHR. DAVID: Close file. MS. LEE LOY: Any maybe as a way through, a more proper motion might be to defer this, in which time Ms. Kierkiewicz can develop the scope of services, which then could be presented at our Kona meeting. And then, we could further Page 18 FC -5 March 12, 2019 amend this communication with the contents of that communication, which identifies the scope of services, and then add that body, decide if that's what we want to move forward on. Because I hear you loud and clear, but I'm also the other concern, that if she generates a communication right now, if it would actually make our Kona agenda. I mean, just putting it on the table as a way forward, that may be the more proper motion is to defer. CHR. DAVID: Mr. Clerk? MR. HENRICKS: Postpone. CHR. DAVID: Yeah, thank you. MR. HENRICKS: And then we wouldn't have any calendar issues with generating a secondary communication. CHR. DAVID: Right. MR. HENRICKS: There would be no deadline for that to occur. CHR. DAVID: Right. Exactly. We'd just put it on the next agenda, right? MR. HENRICKS: As far an agenda item, underneath this agenda item, which would have been postponed to that day. CHR. DAVID: Yes, right. Okay, so that solves one question. Mr. Richards, before I continue, you can go ahead. MR. RICHARDS: So I'm just asking a question, are we forming the ad hoc yet? CHR. DAVID: No. MR. RICHARDS: Okay. So I'll just work with you Ashley. CHR. DAVID: Thank you. And before we wrap this up, I just wanted to be very clear that the scope of this ad hoc, because of the severe timelines that we're exposed to on budget, that the topic picked is something that we can benefit from in our budget discussions. The rest I agree. You know, we can form ad hoc committees further on down the line, whenever we need to address these other various topics. But for this purpose, I'd rather see it focused on something that is achievable as an ad hoc committee for Finance. The rest we can do after budget or whenever, a work in progress. Mr. Clerk? Page 19 FC -5 March 12, 2019 MR. HENRICKS: Yeah, just a matter of procedure. You could define this in different ways. But HRS (Hawai`i Revised Statutes) is clear, it says investigate "a" matter" CHR. DAVID: "A" matter, yes. MR. HENRICKS: of official board business. So I think that whenever we put something in writing as far as scope, maybe that's the first step, what is "the" matter? CHR. DAVID: The matter. MR. HENRICKS: Correct. Thank you. CHR. DAVID: Yes, I was noticing that in our rules. It doesn't say "matters." It says "a" matter relating to board business, and a combination of various issues is pretty much, for me, hard to consider as "a" matter. It's a huge matter for that matter. Anyway, okay. On that note, Ms. Lee Loy, do I hear motion to postpone Communication 149 to—Mr. Clerk, when's our meeting in Kona? MS. LEE LOY: On the 27h CHR. DAVID: Motion to postpone Communication 149 to our March 27h meeting in Kona? Vote on Motion to Ms. Lee Loy moved to postpone Comm. 149 to Postpone: March 27, 2019. Seconded by Ms. Kierkiewicz and (Approved) carried by the following voice vote: Ayes: Committee Members Chung, Eoff, Kaneali`i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David – 8. Noes: None. Absent: Committee Member Poindexter –1. Excused: None. CHR. DAVID: And also, I'm sorry, I forgot to make a note for the record that Council Member Poindexter did have a note that she would not be able to participate for our meeting. ORDER OF The Chair directed the Committee to proceed to the next order of business, RESOLUTIONS: Order of Resolutions. (There were none.) Page 20 FC -5 March 12, 2019 BILLS FOR The Chair directed the Committee to proceed to the next order of business, ORDINANCES: Bills for Ordinances. (There were none.) CHR. DAVID: Given that, motion to adjourn. Someone, please? ADJOURN- There being no further business, at 11:13 a.m., Mr. Kaneali`i-Kleinfelder moved MENT: to adjourn the meeting. Seconded by Ms. Eoff and carried by the following voice vote: Ayes: Committee Members Chung, Eoff, Kaneali`i-Kleinfelder, Kierkiewicz, Lee Loy, Richards, Villegas, and Chair David — 8. Noes: None. Absent: Committee Member Poindexter — 1. Excused: None. CHR. DAVID: We are adjourned. Mahalo, everybody. Approved: Ms. Maile Medeiros Davi , Chair Finance Committee MD/na (Date) Page 21