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HomeMy WebLinkAboutREP FC 092 2019/12/03 2018-2020 REPORT OF THE COMMITTEE ON FINANCE DATE: December 3, 2019 Re: Comm. No. 634/Res. No. 423-19 PLACE: Council Chambers Hilo, Hawaii TIME: 5:30 p.m. Council Chair and Members Hawaii County Council Hilo, Hawaii 96720 Your Committee on Finance, to which was referred Resolution No. 423-19, reports as follows: Resolution No. 423-19, transmitted by Finance Director Deanna Sako, via Communication No. 634 dated November 14, 2019, authorizes the payment of funds of a later fiscal year and of more than one fiscal year for multi-year lease of real property for the County of Hawaii Department of Environmental Management. This resolution authorizes the Mayor to enter into a seven-year lease agreement with two additional five-year options with W. H. Shipman, Limited, for property in the W. H. Shipman Industrial Park to construct a compost facility which would provide for the diversion of organic material from the County's waste stream. Department of Environmental Management (DEM) Solid Waste Division Chief Greg Goodale gave a brief explanation as to the area where the compost facility will be constructed at the Shipman Business Park. He stated an area of about 20 acres has been identified and an Environmental Assessment has been done with a finding of no significant impact. DEM is now in the design process. The County has been working with W. H. Shipman, Ltd., to allow DEM the ability to move forward with a long-term lease. In response to Council Member Susan Lee Loy's question regarding DEM's timeline, Chief Goodale stated that DEM would move forward with the lease, and then the design phase. He indicated that DEM is working with the contractor and its designer and are on schedule for completion in July of 2020. Ms. Lee Loy asked Finance Director Deanna Sako about multi-year contracts over different fiscal years with other departments. Ms. Sako stated the reason for this resolution is to make sure they budget accordingly. She noted that one of the options will be to purchase the land; however, it is not an option at this time because the property needs to be subdivided, as the 20 acres is part of the approximately 100 acres. DEM already has a multi-year contract for the composting facility; they just need a site that this resolution is authorizing. Council Member Herbert M. "Tim" Richards, III stated his concerns regarding issues with the neighboring landowners once the composting goes forward. Mr. Goodale said DEM identified locations that would be acceptable for this type of facility, and DEM's primary concern was looking at the FC Report No. 92 FC-92 Page 2 December 3,2019 proximity to the nearest neighbor. The upside with the Shipman property is that it has parcels bordering their property, which insulates them from neighboring lands. Council Chair Aaron Chung inquired what stage in negotiations were DEM and Shipman at? Ms. Sako explained that an offer has been provided to Shipman, and they are getting an independent appraisal because the County cannot pay more than the appraised value. Council Member Matt Kaneali`i-Kleinfelder asked if the facility would be open in July of 2020. Mr. Goodale explained a certain amount of testing will need to be done to snake sure the facility is functioning the way it should and said, "Whether it is actually functioning in July 2020 remains to be seen." Mr. Kaneali`i-Kleinfelder wanted to confirm they will be taking greenwaste as well as recyclable cups and recyclable products that was set in place by the Styrofoam ban as well as collecting food from different establishments. Mr. Goodale explained the facility would be able to process all types of materials, such as compostable as well as greenwaste. Also,part of the system would be a facility constructed at the West Hawaii Landfill, that will also collect those materials and brought over to the East Hawaii facility. Mr. Goodale stated the trucks will go over from East Hawaii with the refuse and come back with the materials collected from West Hawaii organic facility. The expectation would be to have the trucks full in each direction. Ms. Lee Loy questioned the Department of Health(DOH)permits attached to the process and whether it is part of the timeline for the 2020 date. Mr. Goodale confirmed that the contractor is in the process of getting the permit from the DOH, which typically runs in five-year time spans. Your Committee on Finance is in accord with the purpose and intent of Resolution No. 423-19, and recommends its adoption. dmm AYES NOES ABS Ex Respectfully submitted, CHUNG X DAVID x COMMITTEE ON FINANCE EOFF X KANEALI`I-KLEINFELDER X KIERKIEWICZ X - LEE LOY X POINDEXTER X MAILS MEDEIR ID, CHAIR RICHARDS X FC REPORT NO.: 92 VILLEGAS X ADOPTED: DEC 1 8 2019