HomeMy WebLinkAbout 09/11/2013 Council Meeting Minutes COUNCIL MEETING
SEPTEMBER 11, 2013
The Council Meeting of the Council of the County of Kaua'i was called to
order by the Council Chair Jay Furfaro at the Council Chambers, 4396 Rice Street,
Room 201, Lihu'e, Kaua'i, on Wednesday, September 11, 2013 at 9:09 a.m., after
which the following members answered the call of the roll:
Honorable Tim Bynum
Honorable Gary L. Hooser
Honorable Ross Kagawa
Honorable Nadine K. Nakamura
Honorable Mel Rapozo
Honorable JoAnn A. Yukimura (present at 10:04 a.m.)
Honorable Jay Furfaro
Chair Furfaro: Aloha and good morning everyone. I would
like to say that this is the date of anniversary, not only for Iniki, but for the
difficult challenges we had with "the attack on 9-11," and the losses we had as a
Nation in New York and in Washington. Clearly, I would also like to take a
moment to thank all of our public servants like Fire, Police, and Civil Defense for
their quick action as our first line of defense and for all that they do. I think it
would be appropriate to take a moment this morning to remember both Hurricane
Iniki and the Nation's tragedy on "9-11."
(A moment of silence was taken, as mentioned by the Chair.)
Chair Furfaro: Thank you very much. Mr. Clerk, I would
like to get an approval of the agenda.
APPROVAL OF AGENDA.
Ms. Nakamura moved for approval of the agenda as circulated, seconded by
Mr. Kagawa, and unanimously carried.
Chair Furfaro: Thank you. I would like to discuss a few
housekeeping matters before we begin with our business for today. We are going to
take the Comprehensive Economic Development Strategy (CEDS) item first today,
followed by the State of Hawai`i Organization of Police Officers Union (SHOPO)
final agreement. That will be the order of the day. I did get a deferral from Public
Works, and I would like to make a notation of the establishment of a new
authorized parking area for the Police Department. I believe Public Works, Civil
Defense, Police Department, and the Prosecutor's Office still have to work through
some details and asked for a deferral today. That item will be deferred accordingly.
Then, there is a request to take the solar water heating item at the request of the
Councilmember Yukimura.
PUBLIC COMMENT.
Pursuant to Council Rule 13(e), members of the public shall be allowed a total of
eighteen (18) minutes on a first come, first served basis to speak on any agenda
COUNCIL MEETING 2 SEPTEMBER 11, 2013
item. Each speaker shall be limited to three (3) minutes at the discretion of the
Chair to discuss the agenda item and shall not be allowed additional time to speak
during the meeting. This rule is designed to accommodate those who cannot be
present throughout the meeting to speak when the agenda items are heard. After
the conclusion of the eighteen (18) minutes, other members of the public shall be
allowed to speak pursuant to Council Rule 12(e).
Chair Furfaro: On that note, we will start by taking any
public comment as it relates to the Council Rule 13(e), which gives people in the
public an opportunity to give testimony without any question and answer from the
Council on any agenda item that is posted. Is there anyone wishing to speak on any
item this morning? Seeing no one, let us get an approval on the minutes.
MINUTES of the following meetings of the Council:
August 7, 2013 Public Hearing re: Bill No. 2495
Mr. Rapozo moved to approve the Minutes as circulated, seconded by
Ms. Nakamura, and carried by a vote of 6:0:1 (Ms. Yukimura was excused).
CONSENT CALENDAR:
C 2013-305 Communication (01/14/2013) from the Chief of Engineering,
transmitting for Council consideration, a Resolution Establishing "Authorized
Parking Only — Tow Away Zone" (No-Parking Zone) at Both Parking Lots Adjacent
to the County of Kauai Police Department Building and Emergency Operations
Center Building, Lihu`e District, County of Kaua`i: Mr. Kagawa moved to receive
C 2013-305 for the record, seconded by Mr. Rapozo, and carried by a vote of 6:0:1
(Ms. Yukimura was excused).
C 2013-306 Communication (08/06/2013) from the County Engineer,
transmitting for Council consideration, a Resolution modifying parking restrictions
at the three on-street parking stalls on the south side of Rice Street just west of
Umi Street to be from 6:00 a.m. to 6:00 p.m. except Saturdays, Sundays, and
holidays, and establishing reverse angle parking and bike lanes on Umi Street:
Mr. Kagawa moved to receive C 2013-306 for the record, seconded by Mr. Rapozo,
and carried by a vote of 6:0:1 (Ms. Yukimura was excused).
C 2013-307 Communication (08/15/2013) from the County Engineer,
transmitting for Council consideration, a Resolution Authorizing the Mayor or the
Director of Finance of the County of Kaua`i to Enter into an Intergovernmental
Agreement with the State of Hawai`i, Department of Health, for a Loan from the
State Water Pollution Control Revolving Fund for the `Ele`ele Wastewater
Treatment Plant Improvements, Project No. C150050-11: Mr. Kagawa moved to
receive C 2013-307 for the record, seconded by Mr. Rapozo, and carried by a vote of
6:0:1 (Ms. Yukimura was excused).
C 2013-308 Communication (08/19/2013) from Council Chair Furfaro,
transmitting for Council consideration, proposed amendments to Chapter 6, Kaua`i
County Code 1987, as amended, by establishing a new article Relating to Charges
and Fees: Mr. Kagawa moved to receive C 2013-308 for the record, seconded by
Mr. Rapozo, and carried by a vote of 6:0:1 (Ms. Yukimura was excused).
COUNCIL MEETING 3 SEPTEMBER 11, 2013
C 2013-309 Communication (08/23/2013) from the Director of Finance,
transmitting for Council consideration, a Bill for an Ordinance to Amend Ordinance
No. B-2013-753, as amended, Relating to the Operating Budget of the County of
Kaua`i, State of Hawai`i, for the Fiscal Year July 1, 2013 through June 30, 2014, by
Revising the Amounts Estimated in the General Fund. (SHOPO Arbitration):
Mr. Kagawa moved to receive C 2013-309 for the record, seconded by Mr. Rapozo,
and carried by a vote of 6:0:1 (Ms. Yukimura was excused).
C 2013-310 Communication (08/23/2013) from the Director of Finance,
transmitting for Council consideration, a Bill for an Ordinance Amending
Ordinance No. B-2013-753, as Amended, Relating to the Operating Budget of the
County of Kaua`i, State of Hawai`i, for the Fiscal Year July 1, 2013 through
June 30, 2014, by Revising the Budget Proviso in Section 2(e) Relating to the
Committed Reserve Fund Balance: Mr. Kagawa moved to receive C 2013-310 for the
record, seconded by Mr. Rapozo, and carried by a vote of 6:0:1 (Ms. Yukimura was
excused).
Chair Furfaro: On that note, Vice Chair, I would like to turn
the next item over to you, C 2013-248.
Mr. Rapozo: Mr. Chair, I know I did not send it in an
earlier request regarding the SHOPO contract, but I do not know if Councilmember
Nakamura would have a problem taking them first so we can get them out of here
as well. I do not anticipate a lot of discussion on that matter, but if it goes that way,
I would gladly yield back.
Chair Furfaro: Let me make a note. The first request I
received was from Vice Chair Nakamura. The second request was my own to put
the Police on.
Mr. Rapozo: Okay.
Chair Furfaro: I am just abiding by the rules, but if the
Councilwoman wants to yield and do SHOPO first, I would be open to that,
Mr. Rapozo.
Mr. Rapozo: Thank you very much.
Chair Furfaro: Thank you very much for that courtesy. We
will go to the SHOPO contract.
There being no objections, Bill No. 2496 was taken out of the order.
BILLS FOR SECOND READING:
Bill No. 2496 — A BILL FOR AN ORDINANCE APPROVING A
COLLECTIVE BARGAINING AGREEMENT FOR BARGAINING UNIT 12
BETWEEN JULY 1, 2011 AND JUNE 30, 2017: Mr. Kagawa moved for adoption of
Bill No. 2496 on second and final reading, and that it be transmitted to the Mayor for
his approval, seconded by Mr. Rapozo.
Chair Furfaro: On that note, I can suspend the rules and ask
Tenari if there is anyone who would like to speak from your group. I will give you the
floor now.
COUNCIL MEETING 4 SEPTEMBER 11, 2013
There being no objections, the rules were suspended.
TENARI MA'AFALA, President of SHOPO: Honorable Chair Furfaro,
Madame Vice Chair Nakamura, and esteemed colleagues of the Council. I just want
to say thank you very much. Whatever the Council decides here today, on behalf of
our Police Officers here on Kaua`i, your Police Officers, we just want to thank you for
your services for the people of Kaua`i and indirectly for the entire State of Hawai`i.
We just want to thank you for the hearings that we were able to attend here. You
guys have been very cordial and welcoming to us traveling from Honolulu. Today, we
have Mr. Michael Bates from Maui. He is a Representative of Maui members there.
We just wanted to say thank you so much for all you do, again, for the people of Kaua`i
and indirectly for our Police Officers. We just want to say mahalo.
Chair Furfaro: Thank you. Are there any questions for
Tenari? No. Again, on this anniversary date of 9-11, we do want to extend our
appreciation to the Police Department, the Fire Department, Civil Defense, and all
the first-responders. Thank you for all of your sincere efforts in our State, County,
and our Nation, as well. Thank you.
Mr. Ma'afala: Thank you.
Chair Furfaro: Is there anyone else who wishes to speak on
this item while the rules are suspended? If not, I will call the meeting back to
order.
There being no objections, the meeting was called back to order, and
proceeded as follows:
Chair Furfaro: The Chair will recognize Mr. Kagawa.
Mr. Kagawa: Thank you, Chair. First, I want to say that I
will be supporting approval of this contract with SHOPO. I believe it is a great
thing that we can be closer to the mainland counterparts. It is always our goal to
have the best and brightest serve us in the most important area of the County,
which is keeping our public safe. I am remiss to say that I think Hawai`i
Government Employees Association (HGEA) and United Public Workers (UPW)
workers have endured very small increases over the past fourteen (14) years or so.
At some point, we need to get them comparable to our mainland counterparts. The
fallout from that is if we do not pay our professional and blue collar workers the
kind of wages that they deserve, then we will not be getting the best and brightest
in those areas. I believe this is a first step to get the Police their fair share, so that
we are comparable to the mainland, and do not lose them to the mainland.
However, his battle is not over. We need to somehow find more moneys in the
future. I have some ideas coming up like maybe increasing the sales tax or General
Excise (GE) tax. We need to find another way to get our County some money so
that we can hire the best and brightest for our UPW and HGEA, as well. I think
that is where we are headed. For now, congratulations to the Police Department
and our Police Officers. You are getting a well-deserved raise for our future. Like I
said, I expect the highest service to our community. Thank you.
Chair Furfaro: Thank you. Mr. Rapozo, the Chair
recognizes you.
COUNCIL MEETING 5 SEPTEMBER 11, 2013
Mr. Rapozo: Thank you. Nobody ever calls a cop when
they are having a good day. Last night, I was thinking about all of the different jobs
and professions that I have had from being a Telephone Installer, Police Officer,
Pawn Broker, Private Investigation, Councilmember, Security Officer at a hotel,
Night Auditor, and I do not know if there is more that I cannot remember; but the
best profession, I believe, is a Police Officer. I am not just saying that. I believe it
is true. Throughout the years, this County has suffered from low recruitment and
vacant positions which relates to overtime expenses. For years, this Council has
always looked at ways of how we can make it more attractive for Kauai people to
apply to be a Police Officer. We have considered tuition waivers at the college. We
have offered or suggested mortgage assistance, rental assistance, and all of the
things that this Council felt we needed to do. Because we are bound by the State
Collective Bargaining Agreement, you cannot pay your officers more than another
County; not that we could afford it anyway, but I know Maui tried it one (1) year
and obviously, it could not be done. This is an opportunity that we all can support,
get behind, and say— through the process, too; the Council did not have to do any
work. The process led us to this point where— and it is a very attractive package. I
am not ashamed to say that, and nobody should be ashamed to say that this is an
attractive package. It is not a package that is not deserving, in my opinion. This is
an opportunity for this Council to finally say, "Yes, we have an opportunity, at least,
to move into the direction of parity."
I will not say that I am biased to Kaua`i, but I will say that— I am not too
familiar with Maui, but I know in Honolulu, if there is a fight, there are a lot of cops
that show up. If you are in Waikiki and there is a little spat going on, there are a
lot of cops who show up. Here on Kaua`i for the general public, often times, it is just
one (1) or maybe two (2) cops. When I started in the Department, there were only
eight (8) beats on the island, and it has to be over thirty (30) years now, but we only
have ten (10). We have a long way to go, but at least in the pay structure, this is a
step in the right direction. Obviously, I will be supporting this, and I encourage the
members of this Council to unanimously support this. Send a message to the Police
brothers and sisters, and throughout the State that Kaua`i supports you folks,
especially on 9-11. What a great day to do it because you guys all deserve it. Thank
you all very much. Thank you, Mr. Chair.
Chair Furfaro: Are there any other members wishing to
speak?
Mr. Bynum: I will make my comments to the people of
Kaua`i. SHOPO knows my position for a long time, and I have made comments at
previous meetings. I am in support of this. I think this may be bringing us to the
point where we can actually be fully staffed on Kaua`i for the first time since I have
lived here for twenty-three (23) years. We all have a goal of expanding beats, so I
see this package as beginning to approach parity with the mainland. We all know
the cost of living here is higher, but when I heard stories that officers were coming
back, that really warmed my heart because we all know how valuable individuals
who are born and raised in Hawai`i, train here, spend some time on the mainland,
and come back. That is very valuable for our community. They usually come back
and stay. I also appreciate the standards of conduct. For the people, the
explanation of standards of conduct that you provided kind of put that whole
question to rest. "What is this?" "Why is this in there?" This is something that we
have to fund. Today, it is easy to vote for it but come Budget time, we find the
revenues and decide what the best way of doing that is. I am also committed to
COUNCIL MEETING 6 SEPTEMBER 11, 2013
doing that. Thank you for all of your work. The gentleman from Maui— thanks for
being here today.
Chair Furfaro: Vice Chair, do you want the floor?
Ms. Nakamura: I, too, will be supporting this Bill. I think to
bring salaries up to mainland counterpart standards— we need to move in this
direction. There is one (1) element within the whole system that I am concerned
about, and that is with the Radio Dispatcher pay. Because of the vacancies in
there, the important job and the very stressful positions that they serve, I really
hope that we can take a real close look at what Maui has done in reclassifying these
positions. They are, to me, emergency-type positions and I think we want to take a
close look at some of those issues moving forward. I will be supporting this
measure. Thank you.
Chair Furfaro: Thank you. Mr. Hooser.
Mr. Hooser: Yes. I was not going to speak because I have
spoken often in the past in support, so my support is obvious, but I do not want to
be the only Councilmember who does not state my support. You have my support.
Thank you.
Chair Furfaro: Before I call for the vote, I just want to say
that there are some future issues for us here at the County. To the SHOPO
Officers, I just want to share again that our challenge is that we are the smallest
County. We even control costs by the fact that we are the only County that has a
seven (7) member Council because we save two (2) salaries not having nine (9) like
the other Counties. We are a small County. Our resources are limited. We want to
look at a few other things in the near future. I think Mr. Rapozo touched on it; beat
expansion. I know it is high on our Chiefs mission; some new approved facilities for
our substations. We started on the west side, but we also need to stay focused on
our basic Government support. Public safety is very high on the mark. Certainly, I
will be supporting this new contract agreement. It means about one million five
hundred thousand dollars ($1,500,000) more to us over the period that is upcoming
in our Operating Budget. I think the Code of Conduct is well-deserved based on the
other costs that are focused on expectations of individual officers, whether it is for
supplies or other needs as it relates to their jobs.
Again, my only comment is that we are a small County. We have limited
reserves. I know the GE tax increase was mentioned, but even that will become a
negotiable item as we deal with the other Counties in State because we are
currently capped on our Transient Accommodations Tax (TAT). That is a
significant part of our income. I am just taking this time to share that with you
gentlemen now, because it is something that we strategically need to stay focused
on, which is the public safety aspects of our basic Government features. It is a
challenge for us, but I think it is one that we are all willing to reach out for and
make it happen. I will be supporting this. Tenari, I am going to have to suspend
the rules again but since you are over from Honolulu, I will if you wanted to add
another feature.
There being no objections, the rules were suspended.
Mr. Ma'afala: Sorry, Chair. I want to address Vice Chair's
comment about the dispatchers. First and foremost, no doubt, that is the lifeline
COUNCIL MEETING 7 SEPTEMBER 11, 2013
between the community and their safety and well-being. Unfortunately, we do not
represent them. They fall under the purview of HGEA. For the longest time in
Honolulu, that has been the same debate. We love our dispatchers without a doubt.
We always give them praises and thank them for their hearts.
Chair, to address your situation, it has been always a battle for me in
lobbying the State. Again, when I say "me" I mean on the behalf of SHOPO. The
unadjudicated fines and citations that our County Officers generate annually; we
average three point eight million dollars ($3,800,000) to four million dollars
($4,000,000) to the State coffers, and we do not get a penny back from that. I did
some research on it and some of the State Legislators said, "It is a perception."
With all due respect, I am not a fan of perception because that is not reality. They
are saying that they cannot give it to the Counties because it will be viewed as—
influenced by Police Officers making money by issuing citations per se. I told them
that is negative thinking. The reality is that is money that is being generated by
County employees, so rightfully so, it should go there. Then I offered them and
said, "Why do you not do it through a "Grant-In-Aid process" where it can be
specifically earmarked for Police equipment, and whatever the case may be; not
necessarily in their pocket, but to help the Counties provide equipment. We
debated the TAT and so forth. I just wanted to share that with you. We are very
mindful, and we said earlier in our testimony that we are very mindful of the
employer's position and there is always room for compromise. We are looking for
the greater good. It is not us trying to be selfish in any way, but just being fiduciary
responsible to our members representing their best interests, not only for the Police
Officers, but the community at-large. I wanted to share those two (2) thoughts.
Chair Furfaro: Tenari, I have a question from Mr. Bynum
for you. Mr. Bynum, you have the floor.
Mr. Bynum: Tenari, thank you very much for those
comments. I am the Finance Chair of this particular Council and it is our
responsibility to fund these things. You are tapping on issues that the Counties and
neighbor islands in particular have talked about. Our Police Officers issue tickets.
People see the things in the newspaper and say, "Oh, look, they set up a speed trap
to make money for the County." We get zip. We ask for it every year for thirty (30)
years, and every year the State Legislature says "no." Funding this, for me
personally, what other Counties are already doing because the TAT was removed is
that they are increasing the property taxes on the visitor industry. We have not
done that. I do not support increasing the GE tax because that is going to hit your
Officers and working class people at a much heavier level, than property taxes.
Visitors need to contribute to the protection we offer them, as well. I have been
really impressed with how focused the Union is on other issues. Do you have a
finance person in the Union?
Mr. Ma'afala: You are looking at him.
Mr. Bynum: So the Chair kind of wears all of the hats.
Mr. Ma'afala: Pretty much. We have a great Staff, but I
am usually the face and voice of the Union in representing it. Mr. Hooser and I
have had many encounters in a good way, of course. That is where it is at. Another
tidbit of information is about our Hawai`i Employer-Union Health Benefits Trust
Fund (EUTF); our health fund. We just had a hearing. Speaking specifically of
Hawai`i Medical Service Association (HMSA)— again, with all due respect to gender
COUNCIL MEETING 8 SEPTEMBER 11, 2013
equality and being gender sensitive; we are a male-dominant profession, a younger
demographic, and we have a mandatory annual training where officers have to
maintain a level of efficiency; physically, mentally, emotionally, and be tactically
sound. In HMSA, our officers give back approximately two point eight million
dollars ($2,800,000) to three million dollars ($3,000,000) of unused medical. If you
look at the EUTF, SHOPO members have a different class. Thankfully under then
Chair Recktenwald, who is now with the Supreme Court; he and his then Board of
Trustees approved that. The current Board of Trustees wants to merge us back in.
A saving to us is a saving to the employers. They just do not understand that, with
all due respect. Like I said, it is not about me or any other individual, but for the
greater good.
Mr. Bynum: Thank you very much.
Chair Furfaro: While the rules are still suspended,
Mr. Kagawa, you have the floor.
Mr. Kagawa: I just feel like I have to respond to
Mr. Bynum about my GE tax proposal. As Finance Chair, your reserve has gone
from forty-five million dollars ($45,000,000) to five hundred thousand dollars
($500,000), so I think my looking at other ways of bringing in revenue for the
County is not a bad idea if we are broke. Thank you.
Chair Furfaro: Tenari, I want to thank you for your
comments about the revenues generated by our Officers in traffic. I want to make
sure that you understand that we are not looking for it all, but we are looking for
part of it.
Mr. Ma'afala: Sure.
Chair Furfaro: I am sure it will be on our Hawai`i State
Association of Counties (HSAC) discussion again.
Ms. Ma'afala: Please let us know. We will definitely stand
shoulder-to-shoulder in projects like this or movements as such, as a united front
where it is for the greater good.
Chair Furfaro: I also want to say that I had a discussion
yesterday with HGEA because I do not agree with them believing that the Counties
can only get Grant-In-Aid for items that are mandated by State for us to do. I think
we are going to be doing some research on the original State Constitution that deals
with other subsidies that should be given to the Counties, especially when it comes
to supporting public safety. There are a lot of discussions out there about options to
making sure that we have enough revenues to cover our Debt Service. Again, thank
you for all of your good service. I am going call the meeting back to order and we
are going to take our vote now. Did you have something to add?
Mr. Rapozo: No, I just have a comment?
Chair Furfaro: Okay. Members, we are back in discussion.
Mr. Rapozo, you have the floor.
Mr. Rapozo: This is more for Tenari and everyone's
information. On Friday, we have our HSAC Meeting on O`ahu. It starts at
COUNCIL MEETING 9 SEPTEMBER 11, 2013
10:00 a.m. at Honolulu Hale, and we will be discussing that unadjudicated fine
issue once again. If you could join us to offer some testimony, that would be
appreciated.
Mr. Ma'afala: Sure.
Mr. Rapozo: It will be discussed and hopefully we can get
it in the HSAC Package again. It has been unsuccessful every year, but we will
definitely keep on trying. We start the meeting this Friday and 10:00 a.m., so we
should to the Package shortly thereafter.
Mr. Ma'afala: It will be held here?
Mr. Rapozo: No, Honolulu Hale.
Mr. Ma'afala: Okay.
Chair Furfaro: On that same note, all of the County
Chairman have agreed to attend this HSAC Meeting.
Mr. Ma'afala: Thank you.
Chair Furfaro: Thank you very much.
Mr. Rapozo: Thank you.
Chair Furfaro: Is there anymore discussion before I call the
meeting back to order? If not, Mr. Clerk, can you do a roll call vote?
There being no objections, the meeting was called back to order, and
proceeded as follows:
The motion for adoption of Bill No. 2496 on second and final reading, was
then put, and carried by the following vote:
FOR ADOPTION: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Furfaro TOTAL — 6,
AGAINST ADOPTION: None TOTAL — 0,
EXCUSED & NOT VOTING: Yukimura TOTAL — 1,
RECUSED & NOT VOTING: None TOTAL— 0.
Chair Furfaro: The vote reads 6:0 with one (1) excused. On
that note, I would like to take a five (5) minute recess to that we can greet some
members in the audience.
There being no objections, the meeting was recessed at 9:34 a.m.
The meeting reconvened at 9:40 a.m., and proceeded as follows:
Chair Furfaro: We are back from recess. The next item
deals with the CEDS reporting. May I have the item read, please?
COUNCIL MEETING 10 SEPTEMBER 11, 2013
COMMUNICATIONS:
C 2013-248 Communication (05/01/2013) from Council Vice Chair
Nakamura, requesting the presence of the Director of Economic Development,
representatives from the Kaua`i Economic Development Board (KEDB), and
consultant Alan Tang, to provide an update on the Comprehensive Economic
Development Strategy (CEDS) – Creative Technology Center Business Plan.
Chair Furfaro: Thank you. On that note, Vice Chair, I
would like to turn the meeting over to you.
Ms. Nakamura: Thank you very much, Chair. I would like to
ask George Costa and Alan Tang to come up here. While they are coming up, I just
wanted to say that three (3) years ago, the Council approved funding for a
Feasibility Study for a digital media facility. A year later, the Feasibility Study
said that in talking to members of the community, there is a lot of interest. There
seems to be a lot of potential to develop a digital media center. Alan Tang was the
consultant who was hired through the Office of Economic Development (OED) and
the Kaua`i Economic Development Board (KEDB) to conduct a Feasibility Study.
The second phase was to do this business plan, and that is the subject of this matter
before the Council. Alan has taken the past year to do his due diligence. George
and Alan can tell us more about their findings.
There being no objections, the rules were suspended.
GEORGE K. COSTA, Director, Office of Economic Development: Thank you,
Vice Chair Nakamura. Aloha Chair Furfaro and Councilmembers. For the record,
George Costa, Director of the Office of Economic Development. I am here today
with Alan Tang, who is our consultant. We have come before you over the last
couple of years with various projects from our Comprehensive Economic
Development Strategy or often referred as "CEDS." I know with all the questions
that we see and responses that we try to provide you, we have got great things in
the works; great projects and great initiatives for the County of Kaua`i with a lot of
economic diversity for our island. Here is one (1) project that really excites me,
personally. I had the pleasure of getting to meet Kevin Matsunaga several years
ago. I continue to just be amazed at what he does at Chiefess Kamakahelei Middle
School. There are other professionals that are helping our young minds to create
this new industry. It is very exciting. Now, I would like to turn it over to Alan
because he has some great things to present to you.
ALAN TANG, Consultant: Mahalo, George. Members of the Council
and Vice Chair Nakamura, thank you for giving us the opportunity. I really do
want to extend the appreciation for your support of this project for the last couple of
years. It has been very, very exciting in the last year when we first started with the
Feasibility Study to take a look at whether a digital media center would be feasible
on Kaua`i. In going through the process, not only was it feasible, but the support
from the community was quite overwhelming. That is the kind of support you need
for a community project. The support came from all the different sectors. George
mentioned about Kevin Matsunaga's program— actually, all of the schools here on
Kaua`i have a program as such and very, very excellent talent coming out of it.
Having this facility would actually help augment some of the work that they are
doing. Throughout this whole process during the Feasibility Study, as well as the
Business Plan, I have spent a lot of time engaging the different stakeholders. My
feeling is that we can put up a business structure, but it is going to take the
COUNCIL MEETING 11 SEPTEMBER 11, 2013
community to make it successful. Their input has been more than overwhelming,
but also very insightful in how we need to build this center.
We put together a very quick mission statement, and this mission statement
is really to promote creativity and innovation through the use of technology. What
started as a digital media center, we felt through the Feasibility Study, was a little
bit narrow. The feedback from the community was that it is digital media and it is
always going to be the cornerstone of what is going to be offered, but it is actually
going to be technology. Besides media, we are going to look at anything else that
might be able to help promote communications in marketing. Even things like
robotics have come into the conversation and we want to support the development of
that as well. Heart and center to this would be a facility, but a facility is just a
building so it is really going to be the programs that allow us to be able to conduct—
the whole premise behind the center is always to be complimentary and
supplementary to what already exists on the island. Through all of the stakeholder
group discussions, it has been very revealing and insightful on how we can actually
elevate and advance all of the resources here that are currently available on the
island. I just want to make sure it is noted that we are serving the students here,
and that is the future of Kaua`i. We are also serving the other aspects of the
community. There is going to be a feature where we are going be able to service the
performing arts community. As we are getting into some of the details, it will be
giving them the space to perform, but if they so desire because of the technology,
their performance can actually be recorded and can be put to commercial purposes,
as well as the professional media and film industry. I like to refer to a report by
Economist Leroy Laney that did it for First Hawaiian Bank back in 2012 for a
projection of 2013 of which he said for the island of Kaua`i, that the visitor industry
is always going to be a cornerstone in terms of the economy. When they looked at
all of the other areas in construction and agriculture, he actually specifically
highlighted the film industry saying that it has a lot more potential as the economy
improves, and shows a lot of potential for economic impact for the island of Kaua`i.
The heart and center of this facility is going to be what we call "the piko
room." It is a multi-purpose room that allows us the ability to host large gatherings
and can be as intimate as eighty (80) people if you have full production gear in
there. If it is setup as a "theater-style," it could hold up to two hundred (200)
people. Because it is flexible and multi-purpose, this center can be redone into a
production studio; not exactly a full Hollywood sound stage, not that kind of size,
but it gives us all of the capability. We spoke with the film industry folks and what
they are looking for is that when they come to Kaua`i, they are using the entire
island as their sound stage and backdrop, so like a film outdoors. Having this
resource will allow them to actually do some smaller work that can augment what
they are doing here out in the field and we also have some post production facilities
that can be used as well. I spoke out of it earlier, but this space can be reformatted
to host performances and that has been a great need in the community. We do have
facilities that can hold up to five hundred (500) plus, but this fits a really nice niche
of not going up to that massive area. Because it is a flexible space, it can be a small,
intimate gathering or up to two hundred (200), as I mentioned earlier.
I mentioned before that a large stakeholder group would be serving the
students. This is where students can really learn to advance technology in learning
both to be more college and career-ready. This facility would have the flexibility for
21st century schools which allows them to have access to computers and all of the
software that goes along with it. Media education or media literacy is definitely
part of the equation, but put the right kind of software into the computer and it can
COUNCIL MEETING 12 SEPTEMBER 11, 2013
do special effects, websites, graphic design, publishing, and a whole variety of
different types of skills. This allows our students and our schools to really take
what they have learned in the classrooms and have the ability to take it further and
beyond.
Besides the actual knowledge transfer, it is also important for students to
gather. With the design of the space to allow an entire school— well, not an entire
school, but a large part of the school that is interested in media and technology to
gather in the space, and also to gather such students and teachers from other
schools so we can have a place where they can convene. Additionally, we have
looked at this space to be used as co-working space so students, teachers, and
instructors can come to the center on their own and have all the benefits of the
technology available to them so that they can get the work done.
These are pictures of sites that we have visited. This is a computer lab. In
reality, if you are able to build a center in three (3) to five (5) years; technology, 21st
century schools are changing very rapidly and moving to a lot more mobile devices
as well. I had mentioned robotics. There is a need for a robotics arena. It does not
quite fit our model, but we can certainly do a lot of brain work behind the
development of the robots themselves in the center because of the technology. They
can take that to the different arena where they can compete. There is a huge
demand for a professional sound studio here on Kaua`i. There is a lot of talent and
there are facilities available, but what we want to do is produce a "state-of-the-art"
as well, so performing recording artists can have a facility that they can use. This
will also be accessible to the film industry if they want to do voiceovers. Right now,
there are a lot of animated features coming out by the use of a lot of the professional
voices. This studio will be able to serve that need as well. It is a little hard to see
on this picture, but most of the facilities in post-production tends to be a little dark
anyway, so what you see on screen could be more visible but we plan to have a
state-of-the-art edit base where regardless if it is the community coming together to
put together a show or the commercial and film industry, they have the ability to
have to lay the software and hardware and including the privacy to go do what they
need to do the create feature films and movies.
It is kind of hard to see in this one, too, but it is a dedicated screening room;
not exactly a theater but the ability to take a look at clips and shows before it
becomes public for clearer review. That is a picture of a lot of hardware and
computers that will be the brains behind the entire center. I had mentioned
broadband before. Broadband is going to actually be "key" to this center. Both the
professionals, as well as residents of Kaua`i, will be able to connect with the rest of
the world essentially. In a place where knowledge can be transferred and discussed
readily, broadband is going to be extremely important. When we are talking about
broadband and digital media, we are talking about really high-speed broadband.
The State has launched a Broadband Initiative to have one (1) gigabit up and down
by the year 2018. If the timing is right, I think this would be a great center to serve
as the pilot project to show the rest of the State how a Broadband Initiative for a
broadband center like this can really benefit the entire community like students,
professionals, and businesses.
This might be the most analog of all the features and benefits of the center.
We plan to have space where we can allow tenants to come in. What we are trying
to suggest with this image is that this will allow folks that have the talent, but may
need some and guidance in terms of business development. "How do you protect
your copyrights?" "How do you rate a business plan and marketing plan for that?"
COUNCIL MEETING 13 SEPTEMBER 11, 2013
We want this to be the hub where commercial activities would happen. We want to
be able to offer these services as well, right on the site. You put all of this together
and we are going to have a creative technology center. Again, the word "hub" has
been used very often with the stakeholder groups. It is actually something that
they have desired and is coming together.
We started this process by developing a quick brochure after the Feasibility
Study, so we can share it around. That quickly became outdated as more and more
people became interested, so we developed a website,
"www.kauaicreativetechcenter.com," where we are able to share what we have in
the center, what we plan to do with it, and also to allow a survey mechanism for
individuals or residents who have an interest that can give us feedback. There is a
form that people can fill out, which I have been receiving feedback through the
form, as well as my contact information is on the website, so I have been receiving
E-mails and phone calls pretty regularly from people who have thoughts and input
on this. We will still continue to develop this. Even though the business plan is
complete, this project is actually very much in its very beginning, and this
document will be a very dynamic, live document that will continue to solicit and
receive input.
To be able to share this across the board, this is a map that I have developed
as the original conceptual floor flan. We do not have the site selected yet, but just to
be able to visualize what we have. You are going to have a lot of the photos around
it, and then a floor plan right in the middle. I actually have a copy here. I kind of
keep it in this small, little folder but as you can see, it is pretty of beat up. The
reason is because this plan has gone all around Kaua`i, actually been around on
Oahu, and has come with me to Washington, D.C. as well. I have shared this
project with Congressional Delegates and asked for their support for the time when
we are ready to ask for funding. I have also received overwhelming support from
Senators, as well as the Representatives. This plan has been shared with your
State Representatives and Senators as well. They are also highly supportive. We
have taken this a step further and have shown this entire plan to potential
foundations and funders to get the feedback. One (1) key element that everybody
finds very appealing about this project is that it touches a broad base of the
community and is an economic developer. I have members of the stakeholder
groups that have been very keen to come to this meeting and to provide additional
feedback in how this center will actually affect the different segments. Again, I
think this project has come this far only because of the support and the interest of
the community, and I think it is going to get built because of that.
We started with a vision of finding a facility that we could renovate. We are
still interested in that, but at this point, we are looking at a possibility of building
from the ground-up. This is not an actual rendering of what we are going to do; this
is just to give you an idea of what it could look like, but we are looking at a free
standing building should the land be available. This is the iteration number four
(4) of the floor plan. Again, it is a conceptual plan because we do not actually have
a site yet. We are in deep discussions with some landowners and other possibilities,
but to keep the conversation, especially to get input from the stakeholder groups,
we created some concept plans. Over here, it is a ground floor— if it is going to be a
two-story building is what we are determining right now. There is a large room on
the left-hand side; that is "the piko room" that I described earlier as the facility that
can allow us to have big lecture. It can be a lecture hall, performing studio, and a
filming studio. We have two (2) larger areas on either side with flexible walls that
can be parsed into eight (8) smaller classrooms, or one (1) large gathering space
COUNCIL MEETING 14 SEPTEMBER 11, 2013
depending on what is needed and the flexibility to it. Even though this is
conceptual, we went to the effort of calculating down to the square footage so that
we have something to work with. Likewise for the second floor, there are a lot of
edit bays and tenant some offices, but special to the second floor is actually the
ability to parse it out and segment one third of it so that it can be used for industry
use. I had the privilege of visiting paramount studios and get some insights on how
they set up their works. A lot of professional industry productions like to have
privacy. If they are able to rent the whole section, this will be blocked off for their
use. They can have their privacy that they need to do their film work.
The plan included governance and how this needs to be setup. We are
recommending a private 501(c)(3) nonprofit be setup with its own independent
board and governance. There is a recommendation of how we should structure that
is setup. It includes regular officers, but definitely representatives from the
different market segments that will be served, so that there is adequate input from
all the different parts of the community. We have also put together a
recommendation for how staffing should be done with four (4) Senior Managers that
we put into the facility, all with specific backgrounds that will be able to advance
the mission of the organization. There were some comments about the salary levels
that we put in. It seemed like it was fairly decent salaries, but when we look at the
scale and expectations that we have, we hope it is actually adequate because of the
kind of caliber of people we want to attract. It is what it is right now. As we move
forward with it, I am pretty confident that we will be able to find people with the
heart and vision to be able to make the kind of impact that we need for the
community.
Just to go over the highlights of the numbers— we did a few business models
and looked at what is most feasible. For this center here on Kaua`i, the majority of
the revenue will come from renting out the facility and a portion of it coming from
earned income, which will be productions by the facility itself. The last part would
be grants and contributions. Unlike a lot of nonprofit organizations, we actually
have minimized the need to do a lot of fundraising for the operation of the facility.
There will be some, but the majority of it will be generated to the rental of the
facility. Looking at the income growth, ultimately this will be about a two million
dollar ($2,000,000) a year facility. As you can see, the grants in the blue line are
the smallest part of it. It will grow over time. Earned income will grow a little
faster and fastest growth will come from facility income. We were highly
conservative in how we projected revenues. We actually looked at the first year at
only a ten percent (10%) space utilization, moving up five percent (5%) to the second
year, and another five percent (5%); so twenty percent (20%) by the third year which
the facility will be able to be operating in the black. A note to that is that in terms
of overall fundraising— I will come back to that in a bit, but I wanted to point out
that we are expecting to have a loss in operations in the first year. It is not
untypical of any business coming up as you get the word around. What we plan do
as a nonprofit organization is to raise the funding of operations for the first two (2)
years to cover some of the loss, but also part of the strategy is that we need to
attract really highly qualified management, and we do not want them to worry
about whether they are going to get a paycheck the next month. The first two (2)
years will be covered through that whole process. This is not rocket science, as it
has been done before. Having raised money for other facilities, it all comes down to
the case for support. Why is this so important to build? I believe that this center
has an excellent case, which comes out to the total bill for this which right now is
projected to be twenty million dollars ($20,000,000). It is not a small amount. I will
be the first to say that it is going to require a lot of hard work, but I will also be the
COUNCIL MEETING 15 SEPTEMBER 11, 2013
first to say it is going to be worth it when we accomplish it. Fifteen million dollars
($15,000,000) will go towards the actual construction and about five million dollars
($5,000,000) will go towards operating expenses. Looking at the construction, we
have factored in the construction costs, as well as Furniture, Fixtures and
Equipment (FF&E). For the FF&E, it is a total about three million dollars
($3,000,000). It might seem a little hefty for a regular building, but it is probably
the minimum that we need because of the kind of equipment and facilities that we
need to be able to provide the services. We have put aside some moneys for the land
cost. As I mentioned before, the operating expenses for the first two (2) years is
covered with the original fundraising, and is typical with any capital campaign.
The cost to raise the money is also factored in for the first two (2) years. This is
before the center is going to be open. It runs at a little less than two million dollars
($2,000,000), so it is roughly a little over nine percent (9%) which industry standard
is ten percent (10%) to fifteen percent (15%) so we are pretty modest in terms of
expenses to raise the money. I am confident of it because so much work has already
gone into this Feasibility Study and business plan and because of the positive
optimism that we have received from the funders that we have spoken with. That is
essentially where we are at in terms of the features and benefits of the center, as
well as the budget to it.
The next step, which we are already embarking, is really doing the final site
selection. We are meeting with several landowners. I was here as recent as last
week talking with several folks and will continue to have those conversations until
we find the right site to fit our purposes, as well as our budget. We need to embark
on fundraising right away. The longer we wait, we will be missing some of the
funding cycles, so we are actually right at the cusp of it, and will be embarking on
fundraising as we speak here. Also, very critical to this, because it is a center for
the community, it would be the governance and incorporation of the nonprofit. We
will be moving forward with that. This would be developed under the offices of
KEDB until such time when a nonprofit can be formed.
Of course, the details of the construction plan. What I showed you before is
basically a concept plan, but once the site is selected, we need to get the (inaudible)
tax to make sure that the actual construction, facilities, and features will still be
able to meet our original projections and can be realistic. As I mentioned before,
and I will keep repeating it, this has been a very rewarding project to work on
primarily because of the support from the community and the input that everybody
has given. They really care about this and really care about Kaua`i. I will roll some
credits right now of all the people that have been involved in this project. This list
keeps growing, which is really wonderful. As the Council, I think you should be
really proud of the residents that you serve because they really care about the
future of Kaua`i. They are fully invested in backing up and running this project
forward. That concludes my presentation. You all have a copy of the business plan.
I am open for questions.
Ms. Nakamura: Thank you. So far, we have four (4)
registered speakers. Why do we not ask you questions first. I will start off with
Councilmember Hooser.
Mr. Hooser: Thank you for the presentation. I did not see
it, but I think you went over it briefly about the governance and ownership. Who
actually owns and operates the facility?
COUNCIL MEETING 16 SEPTEMBER 11, 2013
Mr. Tang: That is an excellent question. The
recommendation is in the form of "501(c)(3) Nonprofit Organization." Of that we
will build a board around it, so the facility will be owned by the nonprofit. The
initial part of the board will be more like a fundraising board because we need that
kind of expertise to build it. Ultimately, the regular operating board will have to
represent different stakeholder groups so they can have input on how the center
should be ran.
Mr. Hooser: Often times you say "we." "We would
form"— is that "you would form" or "the County would form?" Who would form the
501(c)(3)?
Mr. Tang: Good question. Let me clarify. I, as a
consultant, is working under contract with KEDB so when I mention "we," it
formally falls under KEDB's jurisdiction.
Mr. Hooser: Okay. The plan envisions KEDB forming a
nonprofit board, and then that board will be going out, raising money, buying the
land, being ultimately responsible for the management, debt, and the operations
success or struggles that are associated with that. So KEDB and the board would
do that?
Mr. Tang: Right. KEDB is, if I can say, would be the
catalyst behind this and ultimately will birth a new nonprofit. They would be fully
responsible for all of the success and liabilities of this center.
Mr. Hooser: The County's role would be envisioned as
what?
Mr. Tang: The County's role has been the visionary and
catalyst behind all of this with the CEDS study and through the support of the
studies that have led to this has been key. I think when we go out for Capital
Improvement Plan (CIP) money, I think there will be some matching funds that we
need to generate. I think when we get closer to the discussion we can take a look at
that. The majority of the funding mechanism—we are actually planning to go
through the Federal and State government, as well as a lot of private funders.
Mr. Hooser: Okay. Great. Thank you very much.
Ms. Nakamura: Are there any other questions from
Councilmembers?
Mr. Bynum: Thank you very much for this presentation.
This is a logical conclusion from the CEDS studies and I am very pleased with the
outcome here. How thorough were these income projections? Are there potential
clients for the client spaces and that kind of thing?
Mr. Tang: That is a very important area and a very
good question. What we did was create a "straw man budget" initially. We took it
out to the community. When we created the straw man budget, what we took a look
at, in terms of pricing, was actually to take a look at what pricing is here on Kaua`i
itself. We want to make sure the price is something that the market will bear. We
also took a look at what the prices are across the board for industry. With industry,
they can afford to pay a little more. We want to be sure that we are not
COUNCIL MEETING 17 SEPTEMBER 11, 2013
shortchanging it. What we have put together in the business plan is still a proposed
budget. When this comes to be, we will have to revise that. We have had comments
that some things are a little expensive because they might want to pay for it, but
some things are a little bit inexpensive. I think once we are down to the actual site,
we can be a little bit more reasonable. We did consult with the community just to
make sure that at least for budgeting purposes, we are right in the ballpark.
Mr. Bynum: I am more focused on the potential income
and if there will lessees of the space because I would assume that a substantial part
of the income comes from lessees that use the facility. This is similar to when we
did the tech centers in Waimea. On one (1) side it was, "Build it and they will
come." On the other side, it was, "Do we have a few people lined up that have a real
specific and sustained interest?" You do not have to answer all of those questions
right now.
Mr. Tang: I do not have specifics to that, but I will
mention that we have been in discussion with some possible tenants to look at it.
Really, it is to explore the concept of whether we have synergy with those possible
tenants, and the conversation is very positive. I do not expect a commitment from
them because we do not have anything to commit to right now, but conceptually
they were very, very supportive.
Mr. Bynum: Right, so that has been part of the due
diligence?
Mr. Tang: Yes.
(Ms. Yukimura is noted as present at 10:04 a.m.)
Mr. Bynum: Thank you very much for a good
presentation. My record has been clear that I support these economic
diversification strategies. I think they are important tour future. Thank you.
Mr. Tang: Thank you.
Ms. Nakamura: Are there any other questions?
Chair Furfaro: I can yield to Councilmember Yukimura.
Welcome. I noticed that you were going to be tardy earlier, but welcome. You can
give her the floor.
Ms. Yukimura: Thank you. I apologize for not being here
earlier. I had a parent-teacher conference. First of all, thank you very much for
this excellent report. Even though I was not here, we did have a chance to meet
previous to that, so I did get the basic rundown. I am very impressed to go from
concept, which is the CEDS being included in the CEDS plan to a clear vision, and
then to an action plan is a rocky road. It is also a very critical one because if you do
not do that well, you will not get to a successful project. I feel like you have helped
guide us and collect all of the data needed to put forth a pathway that I believe will
end up in great success. I appreciate the level of detail and thought. I hope that
our other CEDS project will have that kind of detail and thought. My question is a
follow-up to Councilmember Bynum's question about how realistic the income
projections are. When we met individually, you mentioned that Maui has had an
experience with their newest...
COUNCIL MEETING 18 SEPTEMBER 11, 2013
Mr. Tang: Sound stage.
Ms. Yukimura: Yes, their sound stage. Thank you. I do not
know if you shared that information earlier today, but if you have not, perhaps you
could share it with us.
Mr. Tang: I most certainly can. Thank you for bringing
that up. Maui has recently finished building a sound stage; the first phase of
several phases. We were able to talk with the Maui Film Commissioner to see how
that has impacted the film industry. The lastest report that we heard was that they
have actually been able to book up eight (8) months in 2014 for three (3) major
productions to the tune of forty thousand dollars ($40,000) to fifty thousand dollars
($50,000) of rental income a day, which generates to ten million dollars
($10,000,000) to twelve million dollars ($12,000,000) a year. This is not an apples-
to-apples comparison because they are a full-blown sound stage and we are not. It
does point to the fact that there is interest in Hawai`i and in the entire State, so
there is a possibility of that income. In discussion with the stakeholder groups,
many of them have said while they have productions here on Kaua`i, because of the
lack of resources, they are unable to do much more of their production. They just do
what they minimally can and take the rest offshore. There was also a comment
that the future of competing for this production dollars will actually lie among the
neighbor islands and not so much focus on O`ahu. It is really imperative that
Kaua`i actually has this resource for the film industry.
Ms. Yukimura: Well, we will take even ten percent (10%).
Mr. Tang: We would look forward to that.
Ms. Yukimura: Ten percent (10%) of Maui's income— that
will work fine. The other concern is the balance that our local people, students, and
others will also have access, so we do not really want it to be booked up by all of the
outside needs. It is a balance because we know that the income that comes in can
help support our students and educational and nonprofit efforts.
Mr. Tang: That is also a very good point that you make.
It is a good problem to have for any business that has the facility. We have
addressed that but not in great detail because we are not really there yet. In
reality, this might come into operation in three (3) to five (5) years from now. It is
part of the intention which is to be able to balance the use of the community as well
as the film industry. Who knows— during that period if the market bears it, we
might be able to expand the facility so that we can offer more resources to both the
community as well as the film industry.
Ms. Yukimura: I am assuming that in the bylaws or the
papers of incorporation, those goals will be made clear so that even ten (10) years
down the road, people know that there is this balance we want to strike, in terms of
an economic development factor and an educational and support for local needs.
Mr. Tang: Yes, most definitely.
Ms. Yukimura: Thank you very much.
Mr. Tang: Thank you.
COUNCIL MEETING 19 SEPTEMBER 11, 2013
Ms. Nakamura: Councilmember Rapozo.
Mr. Rapozo: Thank you, Madame Chair. Thank you for
your presentation and the time you spent last week. You talked about the full
blown sound stage in Maui, but Kaua`i could compliment that to some extent if the
production is done on Maui. They could do some of the production work here at this
site electronically or digitally transmit the work to Maui, so Maui could serve as the
base for the major production. Kaua`i could definitely play a major role.
Mr. Tang: You make an excellent point. I have had
some feedback from my colleagues on O`ahu that if you are able to build a center,
they will come over to do some of their post production. To your point, I think it is a
nice compliment to what Maui has. The other comment that came from the
commissioner is that what we have that Maui does not have is the educational
component. I am not just about training the kids; we are talking actually training a
workforce. To build work on a film set—you cannot just walk on it and be able to do
anything. You have to be trained to know how to work on a set. We can have that
because we have the educational and training component. We can offer that to the
residents here.
Mr. Rapozo: Right. Thank you and thank you for your
work.
Mr. Tang: Thank you.
Chair Furfaro: Great presentation, Alan. I like the fact that
we are thinking big and never negotiate from the bottom-up. In politics, you need a
fallback. When you estimated one million five hundred thousand dollars
($1,500,000) for land, did we consider the fact that we could reinvest in our
convention center? For example, the food and beverage portion of our auditorium
would give us maximum about ten thousand (10,000) square feet, but that building
is almost useless. The acoustics are horrible. You cannot have any reasonable
activity in there for any quality. We have parking in that facility. We have extra
land near the baseball field. It would probably be a complete tear-down, not on the
theater side, but on the conference side. That would save us some money, but was
that area looked at as a potential site? It is close to the high school and the
Marriott. It has a lot of plusses.
Mr. Tang: I appreciate you bringing that up, but no, we
have not looked at that site specifically. At this stage, we are open to look at any
possibility. There are certain specific requirements that we need to look at. Like I
said, we are still at the site selection stage so we will definitely look into that.
Chair Furfaro: The building itself is extremely dated. We
have an auditorium there. Obviously we could upgrade a film production portion on
the stage side. We come to the table with almost fifteen percent (15%) of the cost
underhand already because we own the land. We have parking. We could do a lot
of things there, incrementally, and can even put office space above the parking lot
and studios for the schools for radio training. I was just wondering if that was
looked at as a fallback.
Mr. Tang: Chair, I really appreciate your innovative
thinking. Like I said, the proposal put forward is really a concept plan. If possible,
COUNCIL MEETING 20 SEPTEMBER 11, 2013
we would like to look at a facility that we already have that we can renovate. Only
if that is not possible, we will build from the ground up. We continue to explore all
of those possibilities, so we will definitely look into that.
Chair Furfaro: I remember that as part of the discussion
when you made your presentation to a couple of us separately. The possibility of
taking an existing asset and renovating it could give us some leverage, especially
when it comes to owning the land and our bond ability. Twenty million dollars
($20,000,000) is a substantial number.
Mr. Tang: Yes, absolutely.
Chair Furfaro: Thank you, Vice Chair.
Ms. Nakamura: That might be a good County match for
Federal funding.
Chair Furfaro: Yes, absolutely.
Mr. Bynum: I just want to say that I think the Chair's
motion is an outstanding one. I am thinking a whole other laundry list of other
benefits that I am sure he has already thought of... land being the primary one,
location, and the way it compliments with the existing use.
Mr. Hooser: Excuse me, I need some clarification. When
I asked my initial question of who would own and operate, it was a private
nonprofit, KEDB driving it. Just to be clear, is this envisioned to be a County
facility, private facility, or a private nonprofit facility? The conversation now is
going towards County facilities, which is okay, but I just need to know what the
intention is. Secondly, I am aware of at least one (1) private sound studio that
caters to entertainers and that sort of thing. Was there thought put into making
sure that this type of operation did not negatively impact the private entrepreneurs
who are already doing some of this work? Those are the two (2) issues. Thank you.
Mr. Costa: As far as the facility, the thought up until
this point has been looking at all possibilities but mainly towards a private facility.
Obviously, this is a great idea. We have a County location that may be a possibility.
That is something that we need to look at. As Alan mentioned, we are in the site
selection stage right now, so it would be part of that.
Mr. Hooser: I have a follow-up to that. I understand the
benefits of County land and County resources, but if it is a County-run facility, it
changes the dynamics a lot.
Mr. Costa: Yes.
Mr. Hooser: That would be important know at some
point, I think, because it clearly changes the whole management structure and
facility. If we are taking existing facilities of County facilities and turning them
over to a private nonprofit, it is another path entirely also because right now those
are County managed facilities. I think we just need to clarify that at some point as
we go down the path of which direction we are going? That would certainly be an
important discussion to have.
COUNCIL MEETING 21 SEPTEMBER 11, 2013
Mr. Costa: Right.
Chair Furfaro: Members, I want to make sure that you
understand that I have done this for a good portion of my life; it is called "due
diligence." I have done this for hotels, other resorts, and complexes like this. If we
clean up the drainage on that piece of property, there is even more land there. I am
not saying that the facility could not be used for the community; that would be the
prime concern, but you could certainly build a number of satellite facilities for
sound, technical advice, production for films, and so forth by just enhancing that
asset. Maybe we should do that as part of the due diligence. That is all I am
saying. I am not pointing that that is the way to go, but it should be part of the due
diligence.
Mr. Bynum: I do not want to get sidetracked, but
regardless, the intention is to create a nonprofit with a Board of Directors to
manage this facility. Am I correct?
Mr. Costa: Yes.
Mr. Bynum: Public-private partnerships like this are not
uncommon, especially when there is a synergy if it actually enhances the current
services that are available to the community.
Ms. Kagawa: Thank you for your presentation. You
mentioned that the Maui facility is pretty successful.
Mr. Tang: Yes, it was just built this year. It is a brand
new facility.
Mr. Kagawa: The numbers are similar to what we have
here?
Mr. Tang: No, it is different. There is actually a
different facility altogether. They are basically a film studio/sound stage, while ours
is our multi-use. If you look at a smaller production space, that would be like the
small portion of what they have as a large sound stage. I brought up that as a
comparison, not "apples-to-apples" because they are a different facility than ours,
but just to demonstrate there is interest in bringing productions to the State of
Hawai`i and Maui has made that their commitment to build a sound stage.
Mr. Kagawa: Do we have any other facility in the State
that compares similar to this one that we are proposing?
Mr. Tang: That is an excellent question. We do not
have anything exactly like this which is what would make us unique; however, we
have a lot of facilities that are very similar. Ho`ike is the public access facility here.
I have been able to work with `01elo Community Media on O`ahu, which is a much
larger facility. I have been consulting with them because their facility is much
larger. Again, they are public access. The big difference is that they cannot do
commercial work, whereas we are allowed to do that because we are not accepting
public access funds. We have been patterning after `O1elo Community Media's
framework. Additionally, I have also looked at a facility similar to this. I was able
to visit a facility in New York City, Downtown Community Television. It has been
around for forty (40) years. It is a nonprofit. It survived for forty (40) years. The
COUNCIL MEETING 22 SEPTEMBER 11, 2013
founder is still working there. It serves students, as well as adults who want to get
into the film industry. They have been highly supportive. They shared with us
their financials so we can understand some of the pitfalls and to see how to put
together the financial strategy.
Mr. Kagawa: I see you have Kevin working with you and
Kevin is a success story for Kaua`i as far as media and really challenging the world.
He has taken Kaua`i and shown that we can compete against anybody. I think
having him on board with you guys if we build it— I think the sky is the limit. I
totally support anything new for our economy that can help us diversify for the
future. With the phones, as a teacher, I see that the kids are so computer tech
savvy nowadays. It is just amazing. You think when you give them the iPad that
you have to go step-by-step to get them ready, but by the time they are issued out,
they are all on and searching all over the place. For us, we are like dinosaurs. The
children are way ahead of us and we have to kind of catch up to where they are. I
think these kinds of opportunities are making that stance to keep up with our kids.
Mr. Tang: I appreciate that, Mr. Kagawa. I am going to
make an extra point about our students. I think you will appreciate that. When we
talk about a student community, we have the shining stars who are the ones that
will be able to advance to college and be superstar creator. Then we have the rest of
us. This center will actually allow and provide services to cater to students at
whatever stage they are at. Maybe they might not want to go to college, but this
will provide some training for trade. Maybe it is somewhere in between. That is
beauty of this when you talk about serving our kids. Yes, they may be right on the
electronics, but it puts the electronics and the understanding of that technology and
to purpose, and then they can find gainful employment.
Mr. Kagawa: Right.
Mr. Costa: Thank you very much, Councilmember
Kagawa, on those thoughts because as the Director of Economic Development and
trying to diversify Kaua`i's economy, we struggle because we really do not have raw
materials to manufacture and export, except maybe for agriculture. Here is an
opportunity. I see it in the neighborhood I work in. There are a couple of homes
when I drive by, I see that they have three (3) or four (4) monitors, so I kind of have
a feeling that they are using the internet and they are conducting their business
through a global marketplace. That would be available to us as well. We can do
those productions like Councilmember Rapozo said. The big production could be on
Maui, but yet we could be here in our tech center doing the editing and all of those
other production assets.
Ms. Nakamura: When we were first starting off, we were
looking at existing buildings that we might retrofit, and then just go in there and
move. I think over the course of your study, you have kind of come to the point
where there is really not a lot of product out there to renovate and convert to this
use. Now we are looking at a different track of possibly building from scratch. It
changes the dynamics a lot and you reflected those numbers in this, which is why
the cost of the center went up. What I do not see in here that I would like you to
take a real close look at is really the planning, design, and construction process. I
do not want to raise the expectations that something like this can be done quickly.
The land use process in this State is cumbersome. It involves different stages. You
probably have to do an environmental assessment, get your land use entitlements,
COUNCIL MEETING 23 SEPTEMBER 11, 2013
construction drawings, and so forth. It will take time. I am not sure if that is
reflected in your timeline.
Mr. Tang: That is an excellent, excellent point,
especially about understanding the local construction environment. That is the
reason why for the initial consultation, we had worked with Peter Vincent
Associates with Honolulu in terms of the concept designs. For the construction, we
actually consulted with Layton Construction, their local office here, who have been
providing us guidance in terms of construction costs, timelines, and such. We have
not gotten into those great details, again waiting on the actual site, but it is our
intent to be able to find local knowledge, understand the permitting, and the whole
process with the Environmental Impact Statement (EIS) and such so that we can be
proper. Yes, every time I come over to Kaua`i and meet with stakeholders, I get the
request, "Can we build it now? Can we have it tomorrow?" The reality is that it is
going to take a few years for us to get through this process.
Ms. Nakamura: Yes. I am just not sure how that is reflected
because I see year one (1), two (2), and three (3), but I think there is going to be a
design and construction period, and I am not sure where that fits in.
Mr. Tang: Right. We did not adjust the timeline but we
did add an actual supplementary budget which is the one point nine million dollars
($1,900,000)— that is the one (1), two (2), and three (3) that allows us... that is
strictly from a budgetary standpoint so that we can pay for the construction
planning and so forth, but it is actually three (3) years leading up to. Of course, all
of this is a projection. We might require an extra year or do it a year less, but I am
comfortable with the three (3) year lead up to when we can actually start the
process.
Ms. Nakamura: Okay. Thank you. If there are no further
questions for Alan and George, then why do we not call up the speakers? Thank
you.
Mr. Costa: Before we leave, I just wanted to
acknowledge KEDB, Mattie Yoshioka, and Mia Ako. They play a vital role. In our
Office of Economic Development mission statement, it basically says that we work
in partnership with the community and businesses. Because we are a small
department, we really rely on other organizations. Mattie, Mia, and their Staff
have been wonderful for us.
Ms. Nakamura: Yes, they have provided excellent facilitation
roles in working with Alan. Ed Nakaya, a board member, was also here earlier.
Thank you, George for acknowledging that. Let us call up the first speaker.
KEVIN MATSUNAGA: Is it okay if I yield to another person who
needs to leave soon?
Ms. Nakamura: Yes.
LARRY LASORDA: Sorry to switch the order. I am Larry
Lasorda for those of you who do not know me. Basically, I wanted to talk about the
finance end of things and keeping production here. I am a twenty-five (25) year
Hollywood veteran, Production Sound Mixer, Department Head, and a Union Board
of Directors and Negotiator in Hollywood until I retired in 2005. From 1988 to
COUNCIL MEETING 24 SEPTEMBER 11, 2013
1999, I would live here five (5) months a year and work on occasional productions
here while I was still working full time in Hollywood. I have probably done about
thirty (30) productions here for television. I consulted on three (3) films. I have
done about two thousand (2,000) network television shows in Hollywood. That is
kind of my background. One (1) big, important thing to make this feasible is
generating income. One (1) way we used to be very good at doing this was having
Hollywood productions on island, which has kind of fallen off in the past few years.
Now, because of the way things are, the rest of the Country is kind of getting into
production, but we still have Kaua`i. We still have one (1) of the best locations in
the world. It is still sought after, but there are also the other islands and also Costa
Rica and Puerto Rico. Costa Rica and Puerto Rico do not have any kind of facilities.
Hawai`i still has tropical, lush things. We have four (4) islands kind of, but Kaua`i
is still the most majestic. One (1) thing that we are behind in all of the other
islands is having any kind of a technical inducement to bring the Hollywood people
here to come and do stuff.
We have talked about the Maui sound stage, which is completely different.
They have had bites for production up to three hundred million dollars
($300,000,000) worth of stuff. That forty-four thousand dollars ($44,000) a day in
sound stage rental—that is just sound stage rental; that does not talk about the two
hundred (200) other people that are involved in that production that needs places to
live, food to eat, et cetera. When a production comes to town, as we all know, it is
not just the picture and what it is costing for technical stuff. The ancillary—the
food and lodging alone is way more than the production. It is very important to
have an inducement to bring them here. This technical center does not have the
large production sound stage but we do have the outdoors. It will have a small
stage which can serve for insert and additional work. It will have a recording studio
in it, which has been key, especially in three (3) of the last productions we have
done here like "Tropic Thunder" and "Six Days, Seven Nights"...
Ms. Nakamura: Excuse me, that was your first three (3)
minutes. You have an additional three (3) minutes.
Mr. Lasorda: These productions had artists and actors
who had other projects going at the same time. There was a lot of voiceover work
that was done for animation that actors in Tropic Thunder and Six Days, Seven
Nights had going on at the time. There was no place to do it. I was working with
trying to find places to get that done and people had to fly off on the weekend.
There were actors who were very mad that they had to leave and come back kind of
thing. The sound recording alone is a big inducement, even though we do not have
a big production sound stage. Albuquerque, New Mexico has kind of jumped into
the picture showing that you can take a remote facility and function with
production offices in Hollywood and shooting. The series "Breaking Bad" was
supposed to be a one (1) year deal. It went six (6) years and generated tons of
money for Albuquerque. That is the kind of thing that can function here, especially
with broadband facilities to have instant communication back and forth. Editing
facilities— you are not going to get the major end of the production work done, but
there are always dailies. When you have actors on location, you need know if what
we have is good or if we have to shoot it again. Doing it on an iMac, which is the
way a lot of people think it can be done, is not the way it gets done. You need to be
able to hear everything and see everything. Consequently, by having a good edit
bay, a good screening room, a sound recording studio, and an insert stage, along
with the lushness and scenic views of Kaua`i; these things can be accomplished.
COUNCIL MEETING 25 SEPTEMBER 11, 2013
Councilmember Hooser, you said that we do have a recording studio on
island. It is really not "state-of-the-art." It is really not "sound tight." We need
something like this in order for an inducement. People like Glenn Frey said to me
that he would record here if there was a place to do it. He is friends with Graham
Nash. Nash's studio does not even really line up one hundred percent (100%). I
should not really say that, but it is a great studio, but there are still things to go.
You will hear from a lot of educators and local producers who are really the
beneficiaries of this thing. I am only here to say that if we do it, money can come in
via Hollywood to support it. Like anything else, it is going to take promotion to do
it. It is not going to be a word of mouth thing. With Kaua`i having the beautiful,
majestic scenery to bring the people here in the first place—now they can say, "We
can do more here than we thought we could." This gives them much more
inducement than just saying, "Well, you have the location, but we cannot get things
done."
Ms. Nakamura: Thank you very much for providing that
perspective, Larry. We have a question for you.
Mr. Bynum: Larry, thank you very much. Thank you for
the things you have taught me about this. What I am hearing—I just want to
confirm this, but this facility has all of the components that are needed for these
kinds of inducements? There is nothing that you would want to add or take away?
Mr. Lasorda: The only thing I would love to add is a
twenty thousand (20,000) square foot sound stage. That is it. Having that is a real
key component. The Hollywood community has learned how to work within the
parameters of the lushness of Kaua`i...
Mr. Bynum: I am sorry. I do not mean to interrupt
because I know you are in a hurry.
Mr. Lasorda: Actually, I have a little time, but I just
thought I was done...
Mr. Bynum: If you had a sound stage— it seems like
production is happening everywhere. All of these cable channels and Netflix is
broadening out. Is there an increase in production in English overall?
Mr. Lasorda: Yes. The Hollywood studios are still pretty
full. The local Los Angeles area— warehousing has now become the way to do
production. I had Kevin's students when they were in Los Angeles for the
convention and go to the show "Shake It Up," which is done on a warehouse stage.
There is more and more need. Expansion of production still keeps going on.
Mr. Bynum: You mentioned that Albuquerque did a
sound stage?
Mr. Lasorda: No. Albuquerque, because it was the
location, and they thought they were literally going to be there and get one (1)
season out of it, which was thirteen (13) episodes, or something like that. The show
was a hit. They ended up staying there for six (6) years. The way they did a lot of
that show was broadband connection to Los Angeles. The writers never went to
Albuquerque. They were in Hollywood the entire time, so to speak.
COUNCIL MEETING 26 SEPTEMBER 11, 2013
Mr. Bynum: Thank you.
Ms. Nakamura: Thank you, Larry. We have another
question.
Chair Furfaro: Larry, I too, have worked on many movies
here from the housing perspective and even from my time with Coco Palms in the
catering portion as to being out at sites and providing. How does the industry look
at the investment that they have? For example, two hundred (200) nights at one
hundred twenty-five dollars ($125) is generating two hundred fifty thousand dollars
($250,000) worth of room business. The room business then generates nine percent
(9%) the Transient Accommodations Tax (TAT) tax. The TAT tax goes to the State
and not to us. There are forty-five dollars ($45) a day for food coverage; two
hundred (200) rooms; and six thousand (6,000) meal periods during the stay at
forty-five dollars ($45) is a substantial amount of money. There must be a
budgeting worksheet for the film people as they plan their production budget and so
forth. Is something like that available to us? Eventually, we have to work on
something that at least shows the Return On Investment (ROI) for whatever we end
up in the way of a partnership.
Mr. Lasorda: I personally have never dealt with budgeting
other than for the sound department. That is beyond my realm, but the thing is
that there is a lot more production out of Los Angeles. Those same requirements for
food and lodging are required in Albuquerque, New Mexico, whether they are in the
Carolinas, or Washington— states that are doing a lot of production, Florida; New
Orleans is doing quite a bit in Louisiana. All of these places have parity as far as
the same kind of expenses.
Chair Furfaro: I could probably ask the Office of Economic
Development to be in touch with these production offices and give us an idea of
what impact they have on their production costs, and expenses that they have for
the actual job site, so we can calculate its financial benefit.
Mr. Lasorda: One (1) of the big things is the financial
benefit to the production companies, too. This was even mentioned to me by a
studio executive the other day that you have that twenty-five percent (25%) tax
incentive. That makes it even more appealing at times than O`ahu... O`ahu having
personnel that they do not have to pay for, but having twenty-five percent (25%) on
one hundred million dollars ($100,000,000) is a big incentive to these people.
Chair Furfaro: I will ask George to follow-up on some kind
of worksheet. Larry, thank you very much for your testimony.
Mr. Lasorda: Thank you.
Ms. Nakamura: Next speaker, please come up.
Mr. Matsunaga: Good morning, Chair Furfaro, Vice Chair
Nakamura, and our Councilmembers. Thank you for the opportunity to provide a
little bit of support for the center. Obviously since I am coming from an educational
background, I will be talking about the educational benefits of the facility. I think
this center will provide a couple of things. One (1), it is going to give us a central
location for training to happen. Right now, although we do have many media
programs in our schools, a lot of us are at different stages. We have some teachers
COUNCIL MEETING 27 SEPTEMBER 11, 2013
that are just getting started and other teachers who have been doing it for a while,
but maybe through lack of funds or things, it is hard for them to progress. A center
like this can provide a location in which we could train students of all ages and not
just hit high school and middle school. We could also even tap elementary schools
and their children to get them started in media. We need to be able to have a
location where we can come together and reach more students that we cannot reach
in our schools. For example, at our school we have nine hundred (900) students and
I can reach maybe fifty (50) or sixty (60) per year, just based on the limitations that
I have and what our school has in terms of offering electives. If we open up a center
like this, then students that are not able to get into my class now have a place to go
to where we can provide some training for them and whatever spark they have to
ignite that, so they can continue. The other thing that this center can provide is
also equipment. Our schools are lacking equipment. Often times, they may have
one (1) or two (2) really good cameras that a class of thirty (30) has to share, or a
couple of good computers. Another purpose of this site could be to provide up-to-
date equipment that students can use that will have the latest programs and
software and the latest types of equipment that students could borrow or use for
their projects. It will kind of give us a more level-playing field for everyone
involved. One (1) of the concerns I had is that if this site is in Lihu`e, would our
schools in Waimea, Kapa`a, or other locations use it? I am a Lihu`e boy. I do not
like to go beyond the bridges. When I ask Joyce Evans out in Waimea, "Would you
use this facility if you had it?" Her response was, "Absolutely. I am only able to
take them so far." With my limitations as a teacher and equipment, this site could
provide the extra training for them. Now with digital media, you know that you can
create content anywhere.
Ms. Nakamura: That was your first three (3) minutes. You
have three (3) additional minutes.
Mr. Matsunaga: With content being able to be created
anywhere, our students right now are already showing that they can do really good
things with what we have. Imagine what we can do with more students involved,
creating content about Kaua`i that they could share with the world, and using a
facility like this. I think that is one (1) of the things that I would really love to see.
We do have a lot of support in the community. A lot of people have come to us and
talked to us about how they support our program and our other media programs. I
think this site can do a lot to expand on that for our entire island. Thank you.
Ms. Nakamura: Thank you. Are there any questions for
Kevin? No. Thank you very much. Next speaker, please.
JASON BLAKE: Aloha, my name is Jason Blake. Thank you
for having me. I am an independent producer here. We have a relatively start-up
company called "Lucky Dog Productions." I play kind of an "on the ground role"
with people like Angela Tillson. I wanted to address some things and maybe bridge
some gaps that I heard today. First of all, someone asked, "Is production
increasing?" Absolutely, the whole fabric of our society has changed with
production. When you look at reality shows to six hundred (600) cable channels,
you cannot watch a video on YouTube without being forced to sit through a fifteen
(15) second commercial that was produced somewhere. That media richness is
going to continue and there will be jobs and opportunities. We will be probably
filming in three (3) dimensions, eventually here. That is not going to change... that
momentum. I think it is really easy to look at the proposal and think that this is
perhaps an entirely speculative project. There is income that may come if we do
COUNCIL MEETING 28 SEPTEMBER 11, 2013
this, but I am here to say that is not true. The income is already coming and Kaua`i
is missing a portion of that. Two (2) major reality shows have filmed here this year.
The biggest known is the Hawai`i life production, like House Hunters on Kaua`i.
They have probably been to Kaua`i ten (10) times. Every time they come, they fly at
least six (6) people in. At least half of those could probably be hired here. They rent
and ship basic equipment here, including really basic filming things like C-stands,
basic video cameras, and things already budgeted in these projects. Just to put into
perspective, C-stands are relatively affordable; two hundred dollars ($200) for a
decent C-stand. These are companies that will pay an Oahu firm two hundred
($200) a week, and then ship over a "subpar C-stand" because we are not on the
"A-list" of the people who film on Oahu, just so that they have access to basic
equipment. Some of those things, rental items especially— I am not talking about
having to have ten (10) red cameras that are the hot thing in Hollywood, but basic
things to support production. If we had them here, there is rental income from that.
Additionally, this is a jobs-creation project. Everybody wants to be a writer,
producer, or movie-star, but there is a whole level of infrastructure that Kaua`i used
to have. More of it is not really supported here and could create more jobs
immediately with a facility like this where you could train people how to be extras
on a movie set without embarrassing themselves. You could train production
assistants to use walkie-talkies properly on set, train a production coordinator who
makes three hundred dollars ($300) to six hundred dollars ($600) a day to do basic
call sheets, timesheets, and expense reports; things that would create money.
Ms. Nakamura: That was your first three (3) minutes. You
have an additional three (3) minutes.
Mr. Blake: Angela Tillson and I probably get a call once
a month for a position that we cannot fill here on Kaua`i. "Do you have a production
coordinator? Do you have a location person?" Sometimes we can do it and
sometimes we cannot because the resources in the community have degenerated.
The people who used to do it either are not here anymore or they have full-time
jobs, and scheduling wise, they are not in the groove. There is real money that
Kaua`i is currently missing, whether or not we build this facility. If we build this
facility, the likelihood of more of that washing over the whole island is big. Those
are my big things, I think... I have two (2) other things. Councilmember Yukimura
talked about the balance between community and use. Everybody loves the idea of
a community thing, but the other thing is that even when a production comes in and
takes it over, very often a good portion of the community is working on those
professional productions and making money. They do not mind giving up their
space for a little bit, if twenty (20) of them get hired as production assistants for one
hundred fifty dollars ($150) a day. They do not mind if they have to wait a month to
produce the thing. Separately, as President of the Kaua`i Concert Association, I do
think we should consider the Convention Hall, but there is a need for an additional
performance space. This is a separate issue. Kaua`i Community College (KCC) is
the finest facility we have, but it only sits five hundred (500) people. When you look
at Maui Arts and Cultural Center, the Hawai`i Theater on O`ahu, and the Waikiki
Shell; if we had a facility that was closer to state-of-the-art and the Convention
Hall, there are many artists who would be doing concerts on Kauai. Maybe an
easier redesign on that facility would be more economically affordable and would
generate a different level of revenue for us too. That is my punch list. Thank you
for having me.
Ms. Nakamura: Thank you for sharing those insights.
Councilmember Yukimura
COUNCIL MEETING 29 SEPTEMBER 11, 2013
Ms. Yukimura: Yes. Thank you. They are good insights.
When you said that the infrastructure that we used to have has degenerated, you
are talking about available, trained people?
Mr. Blake: Available trained people and equipment.
Ms. Yukimura: And equipment. This idea of training a
workforce is what you were talking about then?
Mr. Blake: Right.
Ms. Yukimura: Okay.
Mr. Blake: There is the long-term vision of"I want to be
a film maker." "I want to produce." "I want to write." There are so many good job
types of positions that are basically working-class, a couple of hours of training, and
then you are still hirable with references to be on set. Now, quite honestly, we have
a pool that is a hodgepodge. The good people are overextended, and then there are
people that are putting your reputation on line for because you do not know if they
can show up and know how to turn on a walkie-talkie. You do not know that they
know not to sit around and eat all the food all day. Honestly, basic training things
would make a lot of that work when it comes to Kaua`i and make the population a
lot more hirable at positions that pay incredibly generous when you look at the
same level of skill required for a job at Costco or Starbucks.
Ms. Yukimura: Right. So it does not require high level
degrees or so forth, but still would be well-paying and would be something that our
population could access if they have training?
Mr. Blake: Absolutely, and not very little, minimal
training about "dos and don'ts" and basic technology pieces. If you look in other
cities where film is developed, many people will put themselves through school for a
film degree while being an extra, or being a production assistant on things. It is
very little training, it is just about availability, knowing the basics, and having the
connections.
Ms. Yukimura: Thank you.
Ms. Nakamura: May the next speaker please come up?
SERGE MARCIL: Good morning. I know there is only six (6)
minutes and I talk a lot, so I might be going straight to the point. I have been
directing television for twenty-five (25) years. I am originally from Montreal,
Canada. I moved to Kaua`i about four (4) years ago. Basically, I have been working
on big productions like National Geographic, Discovery Channel, and those types of
networks and broadcasters. The decision to move to Kaua`i was made because
technology allows me to basically do my thing from a remote island like this one.
The very face of television production and film production has changed so much
because of the internet, the price that the camera costs, and everything. I am here
today, completely dedicated to try to initiate projects from Kaua`i that will air on
mainland broadcasters and networks. I was also approached by Kaua`i Community
College and I am also teaching as a lecturer at Kaua`i Community College, so today,
I am representing both Kaua`i Community College and myself as an independent
COUNCIL MEETING 30 SEPTEMBER 11, 2013
producer in support of the creative technology center. Once, we had a meeting
when I was actually directing a show, and we had a broadcaster, vice president of
programming talk to us and say to the producer, who was actually going to produce
the television show I was going to direct, to explain the difference between a "need"
and a "want." What she was telling us was that basically, the broadcaster she
represented; they were after stories and ideas that would address needs and not
wants. Everybody wants to have a vacation and everything, but the kind of show
she was looking for was that everybody needs to have a budget, so how can we do
this? For me the creative technology center represents not just a want, a desire, or
a wish, but really a need. You mentioned when you were talking earlier, how kids
are incredibly— it is a new reality. I have two (2) daughters who are nine (9) years
old and eleven (11) years old. My eleven (11) year old asked me last week, "How can
I have my own website?" It is the way people interact basically, whether we see it
or not or whether we agree with it or not; technology is becoming more and more
present in our lives. I see it. I teach at KCC. I see my students on their
Smartphones and everything. It is everywhere, so we need to fully embrace that.
The need is there. I do say it all the time. For me, the creative technology center
has amazing possibilities as far as attracting like Hollywood productions to come,
but first and foremost and that is what I have said to Alan and everyone; for me, the
greatest potential for the center is really what it will do...
Ms. Nakamura: That is your first three (3) minutes. You
have another three (3) minutes.
Mr. Marcil: It is what it can do and what it can achieve
for a local production and also for students. Being in Montreal, there was a lot of
energy and resource made because of the cultural reality of the province of Quebec,
French Canadian (inaudible), so the Government invested. I realize that the reality
of Montreal is very different that the reality of Kaua`i as far as resource and all of
that, but the result was that basically, there was a multimedia city that was
created. Ubisoft came out of this, so they started creating software. This is a major,
major company that was later purchased, but also smaller initiatives like Moment
Factory or the Society for Arts and Technology (SAT). These are buildings that
are— for the SAT building, it is very similar to the creative technology center.
Basically, the main thing was that as a producer, musician, graphic designer, or as
whatever; you had a place, you had a hub that acted as a catalyst for you to make
connections. I can develop my project as a one (1) man band; I can write my script,
shoot it, direct it, edit it, and try to sell it. The fact is that it will be better if it is
done in collaboration with other professionals. This is the place to connect—
already, I can tell you that just since we have started talking about the creative
technology center, it has introduced me to some of the stakeholders. Already, I was
saying, "Well, it is fantastic." This is what we need, but I really feel that it will take
it to a next level. When I was watching the halftime show at the Super Bowl— I
think it was last year with Madonna doing her thing. All of this technology; all of it
came from twenty (20) and thirty (30) year olds from Montreal that actually met at
this Moment Factory thing. Basically today, they were supporting us. You name
it— whether it is Cirque du Soleil or whatever you have coming from technology, it
is because there are places where people connect and meet. For me, that is the
main key. I am not sure who was saying... a lot of people are saying, "Can it be
built tomorrow?" I am just telling you if it were built tomorrow, I would probably
move my production office there tomorrow because I do want to benefit from this
kind of environment. I know for a fact... I also see the students that I teach at
KCC; the good ones, we lose them. They go to Honolulu or they go to the mainland.
COUNCIL MEETING 31 SEPTEMBER 11, 2013
It would be fantastic if we could keep them and have them and basically start a
workforce. That is why I am in support of it.
Ms. Nakamura: That is the idea. Thank you.
Councilmember Yukimura, do you have a question?
Ms. Yukimura: I just want to say that it is really wonderful
to have both your skills and perspectives here on Kaua`i. I appreciate what you did
in your moving piece on the junior lifeguards. Thank you very much.
Ms. Nakamura: Chair Furfaro.
Chair Furfaro: (Inaudible).
Ms. Nakamura: Next speaker, please.
SUE KANOHO: Aloha. Sue Kanoho. Good morning, Chair
and members of the Council. I am losing my voice. I am sorry. I had a busy night
with my husband with the 25th anniversary that we celebrated. If anybody
remembers Judy Drosd and when I was at KEDB, we did something called "the
Kaua`i Institute for Communications Media." That was basically a lot our dream of
that is this today. When I was at KEDB, this has been a dream of mine for a very,
very long time. I am of course thrilled about this project. It is further than I ever
expected, so thank you to Alan and KEDB for the work that they have done, and of
course George Costa. When I saw and met with Alan, I was just amazing that
something that I thought of— not myself, but we dreamed about through the
American Film Institute, we brought— I do not know if anybody remembers the
first digital... actually, it was behind-the-scenes of"Jurassic Park." I do not know if
anybody remembers, but we brought in the filmmakers and did a conference. We
actually did four (4) conferences around this, but we were using hotels and were
limited to what we could do. We were also very limited in the people that we could
work with because again, it is "a hit and a miss." I liken it to tourism in a way
because all of the islands compete with each other. Every time you add an asset, it
helps you be in the game longer and gives you some diversity. Again to Kevin's
point, I have been very amazed at what the kids are doing at Chiefess Kamakahelei
Middle School. This, to me, is the next step for them to keep them here and get
people trained. As it has been stated before and as Jason said, we really do struggle
for having people. When film comes, as Jay knows, it is in the moment. "I need this
and I need it now." That is why we struggle sometimes. We do not have the assets
and because people have their real jobs to stay here, they are not able. Right now, I
have a Japanese film crew coming on island for something we are doing in tourism.
Again, they are struggling to find the people. The more we can diversify; I think
this will help us. I will let you know that I had to fly Kapu Kinimaka-Alquiza to
O`ahu to record the piece that is in our new video that you will see later if you all
come to my annual meeting. We did not have the facilities here to record that, so I
had to pay for her to go to O`ahu and get the air, hotel, and everything for her to
record. Lastly, I just wanted to say that for Kaua`i, I think if we were a little more
aggressive in our film marketing, I think we could be stronger. I think anymore
support that we can put to film marketing and being proactive would be really
helpful. I think the intent that we hear is that Hawai`i International Film Festival
(HIFF) Kaua`i is going to come back to the island this year. If that happens, I think
it just helps lift up the intent of film and even music for that fact.
COUNCIL MEETING 32 SEPTEMBER 11, 2013
Ms. Nakamura: That is your first three (3) minutes. You
have another three (3) minutes.
Ms. Kanoho: I will wrap it up. I just wanted to mention
that the Kaua`i Music Festival. What happens in that moment of time is again,
bringing people together. Music is created, connections are made, and then it goes
away. There is a lot of talent on this island. There are a lot of people that could be
grown into better talent for the future if we had these facilities. I strongly support
it and I thank KEDB and OED for doing this, and to Alan Tang and his group for
the work that they have been very diligent in doing their work, looking at other
facilities, and looking what works and what does not work. Thank you.
Ms. Nakamura: Are there any other questions for Sue? Sue,
I just want to thank you because I know you have been behind-the-scenes, helping
Alan with your leadership, and connections in the community. Thank you very
much.
Ms. Kanoho: Thank you. I think it is a great project. It
goes to this point of economic diversification. I know everybody harps on tourism
being too—well, anyway, we need to diversify. This is one (1) of those opportunities
that I think will do great.
Ms. Nakamura: And a huge linkage with the visitor industry.
Ms. Kanoho: Yes, it will work well.
Ms. Nakamura: Thank you. Are there any other speakers?
GLENN MICKENS: For the record, Glenn Mickens. Thank you,
Nadine. First, I want to thank Mr. Tang for his fine presentation and for the
testimonies from the members of the public. I thought they were all excellent. We
spent over twenty (20) years trying to get a true sports center on Kaua`i. Even
today, we are still going after one, but the money to build it and the money to
maintain it just is not there. This technology center, no matter how badly needed or
how much we want, will encounter the same financial problems. In a week, I will
be in Havana, Cuba with our University of California at Los Angeles (UCLA)
Alumni baseball team, but for me, sports is of just as great a value as the
Information Technology (IT) world. The bottom line is that financing to build and
maintain a facility is— in these hard times, I am pessimistic that this venture can
happen. If this can be built without using tax money, I would be one hundred
percent (100%) for it. Anymore than the Kauai Marathon, I do not believe tax
money should be used. If these people can optimistically, as they say, come up with
the money to do this without using our money, I am one hundred percent (100%) for
it. Any way that we can create more jobs for this island, I am for it and for
diversifying our economy to get it off of just tourism. Thank you very much.
Ms. Nakamura: Council Chair Furfaro.
Chair Furfaro: Glenn, good luck on your trip to Cuba and
bringing some Kaua`i spirit with you. There was a gal that at sixty-four (64) years
old, she just swam from Cuba to Florida.
Mr. Mickens: I saw that. Unbelievable.
COUNCIL MEETING 33 SEPTEMBER 11, 2013
Chair Furfaro: That was her fifth try, but she said she never
gave up on her dream.
Mr. Mickens: Right.
Chair Furfaro: I think what we heard from Sue and some of
the people in this production is that ultimately, it is a dream to diversify. We are
trying to gather some facts. I think your points about costs are very appropriate
because we have to learn how to measure the income that comes from these, as I
was pointing out. I do not want to damper anybody's dream about trying to get us
that, including the sports field. I just wanted to say that and good luck to you on
your trip.
Mr. Mickens: We have been playing baseball all around
the world now, and I see how sports bring people together. I think with sports, I
think we would have less wars and everything if people respect other athletes and
stuff. I am not diminishing the IT world. I think it is extremely important. I am
illiterate completely with these iPhones and iPads, and all this stuff. I am in the
long ago world, but anything we can do to keep improving these things, I am
completely for it.
Chair Furfaro: Well, that was my point to constantly make
some improvements. I remember bringing from the first T1 line into the hotel and
converting it for telecommunication purposes. Anyway, good luck on your trip and
let us keep the dream alive.
Mr. Mickens: Thank you, Jay.
Ms. Nakamura: Is there anyone else who would like to testify
at this time? No. Okay, then we will come back to discussion.
There being no objections, the meeting was called back to order, and
proceeded as follows:
Mr. Rapozo moved to receive C 2013-248 for the record, seconded by
Mr. Kagawa.
Ms. Nakamura: Is there any further discussion?
Councilmember Kagawa.
Mr. Kagawa: Thank you, Chair. I want to thank KEDB,
OED, and Alan and your group. Most of the time I agree with Glenn, but in this
case, I feel that the County probably needs to step up and support this group at
some point for the same reason as Glenn feels. It is to diversify our economy and
give our people some new opportunities that they would have to seek elsewhere if
we do not have it here. Look at the films that have taken place here. They are
icons like "Jurassic Park." You name it— Kaua`i is a hotspot for the film industry.
The main reason is that the people in the films and in the industry love coming
here. Would they rather go to Albuquerque, New Mexico? I have been there for
college baseball playing the Lobos. That place is like a desert. You cannot
comparable compare Albuquerque, New Mexico to Kaua`i. It is night and day. You
know it, Glenn. I know you played there too. But Albuquerque is doing well. They
have a great facility. A place like that, Barron, needs something like that to
generate their economy. Here on Kaua`i, it is beautiful and people want to come to
COUNCIL MEETING 34 SEPTEMBER 11, 2013
visit anyway. In order to fully take advantage of that multi-billion dollar film
industry, we need to have some things in place and we can maximize that revenue.
I think this is one (1) area where we totally need to go for it. I kind of disagree
about getting on that Convention Hall site because I think we need to have our own
site; our own place. Like the Chair said, sometimes when it comes to money, we
may have to go there first. I do not know what is best— I am not the person to tell
you what to do. I think you have a good group that can decide that. What I can tell
you is that I will give my full support to help this group in any way that we can
because this is for our children and our future. I really believe in it. I think this is
the way to go. Thank you.
Mr. Rapozo: Thank you. I would agree. I think the
project is a great project. Glenn, I appreciate your concern and citizen oversight
because I think it is important as well. We have to weigh that out. I am not sure—
when did New Mexico become a State? Were you playing before then Glenn? I am
not sure. This is an opportunity. A lot of these actors come here, film their shows,
buy property, and end up living here part time. This is an opportunity for them to
assist in giving back to the community by funding, financing, and so forth. If they
love it so much here and decided to move here, they can help out with a little bit
here and a little bit there. I am looking towards that end, that the industry,
Hollywood, and so forth that would benefit much from this facility would assist in
getting it started, and not the taxpayers. I would hope that we are pursuing that
angle as well. To all the Hollywood people that came and testified and all the
professional producers and so forth all have connections in Hollywood and wherever
else— Pierce Brosnan and all of these guys who have enjoyed our paradise, they can
give a little to see this get off the ground. I would encourage that because that is
where I think it should come from. Aside from that, I think Ross talked about all of
the practical reasons to support it like the kids. Again, what Kevin has done with
our kids here on Kaua`i, I would say it is legendary. He wins every year. He travels
now. He does not have any sound studios. He basically has a portable studio and
whatever he can fit in his carry-on bags; that is his studio. He does a great job with
that. Imagine if we had a facility that he could operate out of and the others as
well. Imagine the kids that would be introduced to this industry that may want to
pursue college. Not everybody is built for college to become doctors, lawyers,
accountants, and all of that, but like you mentioned about the kids with the
electronics today; they enjoy that. It is amazing how they can teach themselves how
to work these things. Imagine if they had some structured education and
structured training? They could be the next Steven Spielberg because they have
that knowledge and desire to learn, they just do not have the vehicle right now.
There are a lot of reasons to support it, obviously. I am just hoping that it all comes
together, including the County, and come up with the funding mechanisms to make
it happen sooner than later. Thank you.
Ms. Nakamura: Thank you. Councilmember Bynum.
Mr. Bynum: I am kind of excited about this one. I am
really appreciative of the excitement that I heard from the people. Just starting
this has already started the connections happening. I heard a commitment for your
first tenant here today, too. This all comes from a comprehensive economic
development strategy that Department of Business, Economic Development &
Tourism (DBEDT) was part of, and this is the second round. Now we are moving to
the third round. Each one is different. This one, the beef industry; those are
industries that will generate revenues for the facilities eventually. We are
providing the start-up and the vision. I cannot take credit for that. A lot of other
COUNCIL MEETING 35 SEPTEMBER 11, 2013
people worked on that. We need to pursue the ones that make sense. This one
really makes sense. I was supporting State tax credits for the film industry at the
Legislature two (2) or three (3) years ago. I wish they would have moved sooner,
but they have. A lot of people do not know that neighbor island tax credits are
twenty-five percent (25%). They are twenty percent (20%) on O`ahu. That is an
incentive to bring production here and bring things here. If you think of a huge
production, five percent (5%) is a huge amount of money. They are going to pencil it
out and say, "Well here are our additional costs for going to Kaua`i. Here are the
benefits for going to Kaua`i." We want to take and narrow those additional costs
and make it easier to come here, and that is part of it. This is a really exciting
project. I think the County will be asked to provide additional resources, but not
ongoing resources. Other CEDS development things mean increasing County
budgets ongoing, and we do those things too. We put a lot of money into our visitor
industry and we will continue to do that. It does not necessarily have a direct
cost-benefit budgetary thing like this project does. That does not mean we do not do
it. Glenn, each one has a different cost-benefit analysis. Thank you very much.
Ms. Nakamura: Councilmember Yukimura.
Ms. Yukimura: Thank you. I, too, want to say thank you,
Alan Tang, KEDB, Mattie and Mia, George and Economic Development, Sue, and
all of the wonderful high-tech visionaries who have been supporting that. Also
thank you to Kevin and your inspiration from the students. I am so glad Sue
mentioned those conferences that were held back in the early `90s with Judy Drods.
Judy was my Appointee as Film Commissioner. Those two (2) had this vision back
twenty-five (25) years ago, and to see it actually be picked up and evolve into this
possible reality is really exciting. I am excited about this project because it
represents true diversification. It compliments tourism, but it does not depend on
tourism. As was mentioned, it is a match between the high-tech skills and
possibilities, and beautiful environment. That is a real powerful connection. Other
places have made it work. We are now talking about how to really build it here on
Kaua`i. As others have mentioned, it offers so many things that we need; the
high-tech incentive, workforce training that matches our workforce, the
opportunities for education from elementary school up to the community college
level, and bringing it all together, is tantalizing. To have a really detailed plan that
will help us get there in a realistic way is really exciting. Thank you.
Ms. Nakamura: Chair Furfaro.
Chair Furfaro: Yes, good presentation. I am going to put a
little bit more burden on George here. I think you know in all fairness, we need to
find out whether we are going into a public/private kind of partnership to do this.
How are we going to measure some of these investments? They are not all real
tangible. We could borrow bond money up to fifteen (15) years or so, depending on
what investment terms there are. What kind of partnership we have in the private
sector? How do we measure the nets on these? A fifteen (15) year return means a
profit margin about seven hundred fifty thousand dollars ($750,000) per year on a
facility like this. We could not measure that seven hundred fifty thousand dollars
($750,000) over a fifteen (15) year period because you know, as well as I do George,
that it does not happen in the convention world as it is right now to look at those
profit margins. We have other measurable returns that we talked about... hotel
occupancy that deals with Transient Accommodations Taxes that will be generated
from that; food and beverage premiums; equipment rentals; employment
opportunities for our young people as well as the existing people. How do we
COUNCIL MEETING 36 SEPTEMBER 11, 2013
measure those? You are not going to find them all in balance sheet. That is what
everybody has to understand here. We are going not going to find them all in a
balance sheet. We are going to find them in, as JoAnn said, some diversification.
We are going to see, as Mr. Bynum said, in some opportunities in public/private
jobs. I think more importantly, we have to have some tangible measurements and
not just by dollars. It is a really good start. I am very, very pleased by what I saw
today. Thank you.
Ms. Nakamura: Thank you. I just want to say that I am very
gratified to see and hear diverse voices supporting this center. The insights that
was individually shared, gives me so much hope that this is going to be a successful
project. I also want to thank George, Mattie, and Alan for doing your homework
and coming up with a good, solid business plan. For talking about the building of
this center, it is not just the physical building. You are building the community.
You are building the relationship and the networks that will make this sustainable
in the long run. I am very happy about that. Finally, I just want to thank every
Councilmember around this table because this is the business plan that we are
finally getting. Before this, we had to take kind of a "leap of faith" and say that we
want to fund the implementation, and that is what we did for this last Budget. If
we did not do that, this project would be at a standstill at this point due to lack of
funding. I want to just personally thank all of you for supporting the funding for
implementation, so that it can move to this next phase. Mahalo.
Chair Furfaro: And mahalo to you. On that note, I am going
to ask for us to take a ten (10) minute recess, but will you call for the vote first?
The motion to receive C 2013-248 for the record was then put, and
unanimously carried.
Chair Furfaro: We are in a ten (10) minute recess.
There being no objections, the meeting recessed at 11:25 a.m.
The meeting reconvened at 11:38 a.m., and proceeded as follows:
Chair Furfaro: We are back from our caption break. The
Housing gentlemen are booked in the afternoon, so we would like to go to the Legal
Document.
There being no objections, C 2013-312 was taken out of the order.
LEGAL DOCUMENT:
C 2013-312 Communication (08/22/2013) from the Housing Director,
recommending Council approval of a Fourth Amendment of Sewage Treatment
Agreement Contract No. 4359 with Kukui`ula South Shore Community Services
(KSSC) to establish new rates for sewage treatment services at the Pa'anau
Development in Koloa, Kauai, Hawai`i: Mr. Kagawa moved to approve C 2013-312,
seconded by Mr. Rapozo.
Chair Furfaro: I am going to suspend the rules. Gentlemen
from Housing, can you come up? I would like for you to give us a little bit of
background as it relates to the wastewater items that indicate that there is a new
COUNCIL MEETING 37 SEPTEMBER 11, 2013
established set of rates for the Housing project for wastewater treatment. Is that
what I am looking at here?
There being no objections, the rules were suspended.
KAMUELA COBB-ADAMS, Housing Director: I will give you a general
overview, but Gary has the specifics and a better history on it. The rates are now
regulated by the Public Utilities Commission (PUC). Basically, it is a negotiated
rate which our Staff has done a wonderful job negotiating. It is for the project
Pa'anau II and it is a private sewer system. With that, I will let Gary go into the
details of it.
Chair Furfaro: First of all, Gary, this has always been
regulated by PUC, right?
GARY MACKLER, Housing Development Coordinator: Actually, Council
Chair, it was not originally regulated by the PUC. It was a private agreement that
the County entered into for sewage treatment service for the Pa'anau Village Phase
I project, and also for the Kawailehua Project. This was a condition to the zoning
amendment that Kukui`ula would be required to provide sewage treatment in
perpetuity for these affordable houses.
Chair Furfaro: I understood about them providing it, but
when it was said that PUC will be regulating it, was it not always the case?
Mr. Mackler: No, the regulation came after the Second
Amendment to the twenty (20) year agreement, which was the initial term of our
agreement. The rates from the Second Amendment were submitted to the PUC and
approved. We then came to the Council for the Third Amendment several years ago
with those rates negotiated. They were...
Chair Furfaro: Excuse me. Tim, go in the other room,
please. That is twenty dollars ($20) for today. Go ahead.
Mr. Mackler: Well, when the Third Amendment was
presented to the Council with a new rate structure, it was approved. Kukui`ula, for
whatever reason, did not submit those rates to the PUC for approval, so those rates
were never in effect. What we are still working with are the rates that were
approved from the Second Amendment. There are two (2) charges to the sewage
treatment: one (1) is a minimum standby charge, which for this next amendment is
two thousand four hundred dollars ($2,400).
Chair Furfaro: For what period of time?
Mr. Mackler: Well, with this new amendment, because it
is now a PUC regulated utility, there is no longer a term to this agreement. It is an
ongoing agreement, which the operator of the system would have to go back to the
PUC for any future requests for rate increases. We are no longer on a termed
agreement, once this amendment is passed.
Chair Furfaro: To clarify my question, it is not two thousand
four hundred dollars ($2,400) a day?
COUNCIL MEETING 38 SEPTEMBER 11, 2013
Mr. Mackler: No. Let me give you an indication of the
rates.
Chair Furfaro: Very good, so you got the gist about my
question about the query.
Mr. Mackler: Yes. As I mentioned, there are two (2)
charges. We pay the greater of the two (2). One (1) is a standby charge, which is
two thousand four hundred dollars ($2,400) and the other is what is referred to as a
"quantity charge." Just to let you know, when we went back and looked at the two
(2) year average of what it is costing us per unit, it is twenty-three dollars and
twenty-five cents ($23.25) per unit.
Chair Furfaro: On the volume charge?
Mr. Mackler: Yes, on volume. Comparatively, for a County
sewer rate currently in effect, it would forty-eight dollars and sixty cents ($48.60),
so we are right about fifty percent (50%) on this private system as to what the
County is charging on the municipal system.
Chair Furfaro: Those charges and those numbers you just
gave me are only for wastewater?
Mr. Mackler: Correct.
Chair Furfaro: It is not for any potable water?
Mr. Mackler: No.
Chair Furfaro: Okay.
Mr. Mackler: In looking at what our average monthly
usage has been, which has been about seven hundred fifty thousand (750,000)
gallons per month at the rate of three dollars and fifty-two cents ($3.52) per
thousand, we are looking at two thousand six hundred twenty-five ($2,625) as an
average monthly charge. We are a little bit above the minimum charge at two
thousand four hundred dollars ($2,400).
Chair Furfaro: How does that fit with your budget?
Mr. Mackler: It is budgeted. When we submit our annual
budgets to the Council for our rental projects, we go back and look at historically
what we have been paying, and then we look prospectively at what we might be
incurring for increases and we factor those in rates and changes.
Chair Furfaro: There is no major variance from when you
factored in?
Mr. Mackler: None anticipated.
Chair Furfaro: Mr. Kagawa, you have the floor.
Mr. Kagawa: Thank you, Chair. The monthly usage is
about twenty-three dollars ($23) per month, per unit?
COUNCIL MEETING 39 SEPTEMBER 11, 2013
Mr. Mackler: Per unit, correct.
Mr. Kagawa: Compared to forty-eight dollars ($48) per
month for a household?
Mr. Mackler: Yes. If you were being serviced by the
County's system with the current rates, you would be paying about forty-eight
dollars ($48).
Mr. Kagawa: Well, the condos would use less water
anyway... wait this is the sewage, right?
Mr. Mackler: The sewage.
Mr. Kagawa: Typically, the same amount of flushes,
depending how many people live there. I am good. That private agreement is
actually working out a lot better than if we were hooked up to the County sewer?
Mr. Mackler: Yes. It really does help us and it does help
support the affordable rents that are charged at all three (3) of the projects. We
have three (3) projects on this system: the Kawailehua Project, which is a State
project with for fifty-one (51) units; Pa'anau Village Phase I, which is sixty (60)
units which the County owns; and also Pa'anau Village Phase II, which is the
newest phase of fifty (50) units which the County owns the land and leases to a tax
credit partnership. All three (3) systems are being serviced by Kukui`ula's
Treatment Plant and under the agreement.
Mr. Kagawa: I guess the scary part is the future increases
that come, but the PUC would kind of help to regulate that to make sure that those
fees are really scrutinized before they are approved.
Mr. Mackler: I believe they will, and I believe we would
also have a voice in any proposed fee increases that might impact our project
adversely. I think we would want to be proactively advocating for the positions that
we want to advocate for.
Mr. Kagawa: I think I am satisfied. Thank you for your
presentation and the numbers. Thank you.
Chair Furfaro: Gary, let me just ask one (1) more question,
and then I will go to Councilwoman Yukimura. The standby charge also reflects
any type of reserve fee... CIP reserve for the system? What is the standby charge
covering?
Mr. Kagawa: It is a minimum service charge that we pay.
If the usage were less based on the gallons as it is calculated against the current
rate of three dollars fifty-two cents ($3.52) per thousand, we would still pay a
minimum charge of two thousand four hundred dollars ($2,400) a month.
Chair Furfaro: There are no other reserve charges as being
hooked up to this system?
Mr. Mackler: No.
COUNCIL MEETING 40 SEPTEMBER 11, 2013
Chair Furfaro: Okay, thank you. Did you want to say
something?
Mr. Cobb-Adams: Yes. I just wanted to clarify one (1) thing.
The project income in our projects pays for the service, so we do not have to budget
any new money. It pays for itself.
Chair Furfaro: I understood how you are handling it. I was
more worried about them having another window of invoicing. Councilwoman
Yukimura, you have the floor.
Ms. Yukimura: Thank you. These charges are passed on to
the individual owners?
Mr. Mackler: No. Actually for both Pa'anau Phases, the
water and sewer is included in the monthly rent that is charged to tenants living in
the projects, so it is not a separate "pass-on" to tenants.
Ms. Yukimura: Maybe that is what you meant by "further
invoicing."
Chair Furfaro: No, it is inclusive for the tenant, but the
tenant is paying rent which is inclusive, but we are dealing with the water system.
I wanted to make sure that they had no other additional charges. That is what I
was referring to, JoAnn.
Ms. Yukimura: It represents an increase, right?
Mr. Mackler: Actually, the rates that are presented in this
Fourth Amendment are the same rates that were approved in the Third
Amendment, but never submitted to the PUC for approval.
Ms. Yukimura: Okay.
Mr. Mackler: We are still operating under those rates.
Ms. Yukimura: Okay. It is just a formality of approving
rates that we are already paying?
Mr. Mackler: Yes.
Ms. Yukimura: There will not be any increases in rents for
the tenants there?
Mr. Mackler: No, there will not be. I would expect
Kukui`ula or their company that is setup to run this system will, after approval
here, go to the PUC with the agreement and seek confirmation of those rates
through the PUC.
Ms. Yukimura: Okay. Thank you very much.
COUNCIL MEETING 41 SEPTEMBER 11, 2013
Chair Furfaro: Are there any more questions for the
gentlemen? If not, thank you. Is there anyone in the audience who wants to testify
on this? If not, may I please have a roll call vote?
There being no objections, the meeting was called back to order, and
proceeded as follows:
The motion to approve C 2013-312 was then put, and carried by the following
vote:
FOR APPROVAL: Bynum, Hooser, Nakamura, Rapozo,
Yukimura, Furfaro TOTAL– 6,
AGAINST APPROVAL: None TOTAL– 0,
EXCUSED & NOT VOTING: None TOTAL – 0,
RECUSED & NOT VOTING: None TOTAL – 0,
SILENT: Kagawa TOTAL – 1.
Chair Furfaro: Let us now go to the beginning of our day.
COMMUNICATIONS:
EDR 2013-03 Communication (07/24/2013) from Councilmember Yukimura,
requesting agenda time to discuss and approve a proposed amendment to Senate
Bill (S.B.) 16, Senate Draft (S.D.) 2 amending Chapter 196, Hawai`i Revised
Statutes (HRS), (Solar Water Heating Law for New Single-Family and Duplex
Construction) by requiring variance applications and requirements to be handled by
the Counties, for inclusion in the 2014 County of Kaua`i and Hawai`i State
Association of Counties (HSAC) Legislative Packages: Mr. Bynum moved to approve
EDR 2013-03, seconded by Ms. Yukimura.
Chair Furfaro: JoAnn, the Chair recognizes you.
Ms. Yukimura: Thank you, Mr. Chair. There was some
confusion in Committee about the Administration's position, and I spoke to the
Mayor yesterday. He agreed that there was a lot of confusion, so he agreed to have
a meeting with Mr. Dill, Mr. Haigh, myself, and himself to clarify so that he could
set his position about this. You will see there is a letter from Larry Dill saying that.
Because there is a deadline here, I want to ask the Council to take a position
because we need to take a position, and I hope that people will vote for it. The
Mayor could possibly also agree with this, but we have to have this discussion first.
He may decide not to agree with it, in which case it will be the situation like it was
last year where the matter will be in the Council's Legislative Package, but will not
be the County's Package. I want to keep this alive for the possibility that the Mayor
may take a position in favor of it and because I think the Council agrees—hopefully,
the Council thinks this is good policy, so that we could keep it alive, take a position
on it, and then still allow the Mayor to determine his position.
Chair Furfaro: Okay. You are asking us to approve this
based on it being the Council's approval, and then if the Mayor comes along later
after his discussion with you, and he so endorses it, to let it go that way.
Ms. Yukimura: It will become part of the County Package,
otherwise, it will not. If it does not become part of the County Package, I think it
COUNCIL MEETING 42 SEPTEMBER 11, 2013
would be very difficult to get it passed in the Legislature. There is still a chance
that we can make it part of the County Package if we pass it today.
Chair Furfaro: Okay. Mr. Rapozo, would you have
something to say about this approach?
Mr. Rapozo: I was trying to find a copy of the proposal.
Generally, is it just bringing the variance granting authority to the County? Is that
pretty much what it does?
Ms. Yukimura: Yes, it is.
Mr. Rapozo: I know the Mayor has not taken a position,
but how about the Departments?
Ms. Yukimura: Well, they do not take a position without the
Mayor.
Mr. Rapozo: Well, I mean as far as the capability?
Ms. Yukimura: There is a misunderstanding as to what
exactly will be involved.
Mr. Rapozo: That is why I am asking.
Ms. Yukimura: That is what has to yet be worked out
amongst the Mayor and his Staff.
Chair Furfaro: Okay, that was posed as a question from
Mr. Rapozo to you. I allowed to you respond. Mr. Rapozo, if you do not mind, I will
go to Vice Chair Nakamura. She has a question.
Mr. Rapozo: That is fine.
Chair Furfaro: You have a question for JoAnn?
Ms. Nakamura: No. I want to clarify that I believe the last
correspondence we received from the Department of Public Works raised some
concerns about the variance. The reason why we deferred it was to allow
Councilmember Yukimura to have the time to work it out and come back with some
information because the estimates that were provided by the Department of Public
Works was in the—I do not have the document in front of me, but it was five
thousand dollars ($5,000) per third-party review. Here is a copy of it. The estimate
was based on eighty (80) variances per year, an annual cost of four hundred
thousand dollars ($400,000). I think there were questions from Councilmembers
about how realistic this number was. If it was not done in-house, and was done by
third-party review, it might be five thousand dollars ($5,000) per variance that
would be passed on to the person applying for the variance. Is that your
understanding?
Ms. Yukimura: That is what is implied in that, but that was
fraught with a lot of assumptions.
COUNCIL MEETING 43 SEPTEMBER 11, 2013
Ms. Nakamura: This is all we have from the Administration
that is on the table.
Ms. Yukimura: Right.
Ms. Nakamura: I just wanted to clarify that was our last
piece of correspondence.
Ms. Yukimura: There were a lot of assumptions, first not
understanding what it would take to process exemptions. There were assumptions
that there was not the expertise to certify whether someone qualified for the
exemption or not, and they had to come from Honolulu. Those were totally hard to
conceive. As you know, we have been very busy so the soonest I could meet with the
Mayor was yesterday. I made the appointment right after the meeting with Larry
Dill. This will not go any place if the Administration opposes it, but if the
Administration wants to support it theoretically, and we do not have it in our
package, then we have stopped any possibility. I guess I am asking that we put this
forward, and let the Administration sort it out and determine its position. That will
be a stopper, if the Mayor finds after discussions that it is not workable and
otherwise, it would allow this thing to become part of our County Legislative
Package.
Chair Furfaro: Let me just query a question here. Our
deadline is September 20th for the County Package? By chance, do you know, Mel?
Mr. Rapozo: I am not sure. Maybe late September.
Ms. Yukimura: I guess we could have a special meeting.
Chair Furfaro: We have time. We can go as late as
October 16th.
Ms. Yukimura: Okay, then we can just defer. Thank you.
Mr. Rapozo: I have a concern simply because currently it
is the State that manages the variance program. I continue to get troubled if we are
going to continue to bring more responsibility to our County agencies, which is
going to require more funding. As far as I know, they are pretty tasked with their
day-to-day right now. I understand there is some concern about how the State is
handling the variance procedure, but it I have a difficult time adding more
responsibility to the County function when it is already in the State. Kaua`i is
starting to set a trend that we can do it better, so we are going to do it, but yet, the
State law is setup in a manner that the State has obligations for certain things.
This is one (1) of them. I will not support this, simply because I believe it is where
it should be. I definitely want to pose a deferral and see what the Mayor has to say.
Thank you.
Chair Furfaro: Councilmember Bynum.
Mr. Bynum: I want to ask Councilmember Yukimura a
question.
Chair Furfaro: Go ahead.
COUNCIL MEETING 44 SEPTEMBER 11, 2013
Mr. Bynum: I just want to make sure I am grounded with
this. The situation on the ground has not changed. The State law exists. It says
very clearly in the law that there are decisions to be made by the end-user. DBEDT
came here and told us... or the ones who process it now... I think it is DBEDT,
right? They needed to change in the State law... they did not have the tools that
they needed to properly fulfill the intent of the law. That is all correct, yes?
Ms. Yukimura: No. The present law does not allow the
end-user to ask for an exemption. It pretty much outright grants an exemption for
anybody; any builder or anyone who applies for an exemption.
Mr. Bynum: The intention of the original law was for the
end-user to make that decision, correct?
Ms. Yukimura: The intention when the Bill was originally
introduced was to not allow any exemption for on-demand gas, but it passed with an
exemption that has become a huge loophole, allowing sixty percent (60%) of all new
construction on Kaua`i of single-family homes to not install solar water heaters.
The proposal from this body was been to close the loophole, but to allow the
end-user, the person who is going to pay the bill, to get an exemption. If they want
to choose a more expensive way of heating water, on demand gas and the life cycle
cost of it, they can choose that. If a spec builder or someone else is building it other
than an end-user, then the mandate is a solar water heater.
Mr. Bynum: I just want to say that I admire
Councilmember Yukimura's diligence on this issue. She has tracked it, and I think
it is a very important issue that I want to support that impacts all people on Kaua`i
because the total use of fossil fuels has to be accounted for. I will not go into all of
those details, but I do would want to support Councilmember Yukimura is making
every effort for the Mayor to get onboard with this. I have encouraged the Mayor to
do that because I think it is an important issue.
Chair Furfaro: Members, this is what I am looking for. Are
there enough votes for a deferral until the Council Meeting on September 25th? It
seems that Councilmember Yukimura would have an opportunity then to speak
with the Administration. If we are going to defer it, I would like to see if there is a
motion to defer and a second. Go right ahead.
Ms. Yukimura: I just wanted to answer Councilmember
Rapozo's point because actually, in terms of logical holder of the responsibility, the
County is the logical one because we already have to give building permits for solar
water heaters. It is really logical if there is an exemption. The County would issue
that, too. It is not adding anything new to the County's regular jurisdiction. I was
totally impressed by his presentation on Act 149 regarding the regulation of
pesticides. It is clearly the State's kuleana, but in this case, because we are already
issue permits for solar water heating, it actually would not be outside of our
kuleana.
Chair Furfaro: Members, I am looking for a deferral on this
item.
Mr. Rapozo: Can I make a real quick statement?
Chair Furfaro: Go ahead.
COUNCIL MEETING 45 SEPTEMBER 11, 2013
Mr. Rapozo: My position is not that we cannot do it. I did
not say we cannot by law. I am saying that I do not believe it is the prudent thing
to do to increase the duties in our Public Works Department, and not that the law
says we cannot. I believe the law is clear that we can in this case, but that is
number one (1). Number two (2) is that it takes away the choice of the developer, of
the person building. One could call "speculative developers" as "people coming out
to make money," but other builders of projects with mass structures could be for
affordable housing as well. These are many issues that I just have some concern
with. Thank you.
Ms. Nakamura moved to defer EDR 2013-03 to the September 25, 2013
Council Meeting, seconded by Mr. Bynum, and carried by a 6:1 vote
(Mr. Kagawa voting no).
C 2013-311 Communication (08/26/2013) from the Director of Finance,
transmitting for Council information, the Condition of the County Treasury
Statement quarterly report as of August 1, 2013: Mr. Rapozo moved to receive
C 2013-311 for the record, seconded by Ms. Yukimura.
Chair Furfaro: Mr. Hunt, are you here for this item? Is the
treasurer here as well? I see him behind you. You can both come up. Let us see if
the members have some questions for you.
There being no objections, the rules were suspended.
STEVEN A. HUNT, Director of Finance: Steve Hunt, Director of
Finance, for the record.
DAVE SPANSKI, County Treasurer: Dave Spanski, County
Treasurer.
Chair Furfaro: Welcome, gentlemen. Members, are there
any questions? I have one (1) then. Dave, first of all, thanks for coming over. From
the standpoint of what looks like we had a pretty tight Budget this last session; how
are we with actual payment deliveries, and so forth? For example, is the State
pretty current on our share of the TAT? Are we dragging anything?
Mr. Spanski: No, Sir. The TAT came in for the months of
November through May on time, on June 30th.
Chair Furfaro: What is the calendar schedule for the
expected payment date for the State on TAT? Is it thirty (30) days? What is it?
Mr. Spanski: I do not know the exact law, but every six (6)
months, we receive our share. It is usually in December. I guess (inaudible) second
half in the first share in June 30th.
Chair Furfaro: I do know that last year at the time we did
the Comprehensive Annual Financial Report (CAFR), they still had not paid us for
the second-half of the year. I am going to go ahead and send a communication over
to the County Attorney. As we get into a tight cash situation, I would just like to
have a definite answer.
COUNCIL MEETING 46 SEPTEMBER 11, 2013
Mr. Spanski: Well, historically, it has been delivered since
my tenure every December 31st and every June 30th on that day, or end of the Fiscal
Year and end of the calendar year.
Chair Furfaro: Dave, it does not change my mind when you
get it when the fact of the matter is that the CAFR comes to us on the 15th, so it
shows up delinquent to us. Secondly, I would like to know from the County
Attorney of what are the rules. I appreciate your comments saying that we have got
it pretty regular, but we have got about a two (2) week lag period that does not show
up in our CAFR. Obviously, as you and I know, if you are doing a Profit and Loss
(P&L) Statement, that is one (1) thing. You are showing it as a receivable, but if
you are doing a cash flow projection, I think it gets pretty timely now.
Mr. Spanski: That is correct.
Chair Furfaro: Steve, what I think you are telling me is
what we just did with SHOPO from a cash standpoint, we may be tapping a little
bit of a reserve until the CAFR comes in and we know the money that we have. In
these circumstances from the cash flow standpoint, I think it is important that we
ask the County Attorney to do that. I will also note that in your whole tenure, we
usually get it late December.
Mr. Spanski: That is correct.
Chair Furfaro: I appreciate that. Vice Chair, and then
Mr. Kagawa.
Ms. Nakamura: Thank you for being here. I wanted to ask
whether any of the bond funds that are now being invested, whether the projects
that we were going to do, if any of them are time sensitive? Are there are any red
flags that we should be aware of on the expenditure of funds?
Mr. Spanski: Well, the oldest one out there is the 2005
issue. There is approximately five million dollars ($5,000,000) left. The original
borrowing was thirty-nine million dollars ($39,000,000), so there is no issue as far
as where we have to pay arbitrage because interest rates are way lower. (Inaudible)
than what we borrowed it. The only thing is that there was a ten (10) year call, but
we have refinanced all of 2005. There is a little piece left, but it is not in the money
to refund, if you will. It is very small, so if we want to refund that, I would
recommend that we add that onto future borrowing to do that because the
professional fees would almost outweigh the costs of our gain. There is nothing time
sensitive. If I was to say that it is going on eight (8) years since we borrowed those,
but other Counties have the same situation also. They do not always meet the
requirements. Here is what we initially said that were going to do— as time goes
on, requirements change or priorities change. Things happen and you change; you
redirect projects, drop projects, and add projects. That is known. When you have
an expectation to do these things, a reasonable expectation, and it is quantified by
the Internal Revenue Service (IRS) that they know things will change and things
happen. I have had no inquiries or anything from the IRS or anybody else.
Ms. Nakamura: Okay. The Build America Bonds—we are all
good with the timetable for expenditure of those funds?
COUNCIL MEETING 47 SEPTEMBER 11, 2013
Mr. Spanski: When they spend down, I cash in. I know we
are three (3) years into that. We just started our first principal payment on that
issue. I know we have been spending them down, yes.
Chair Furfaro: You okay?
Ms. Nakamura: Yes.
Chair Furfaro: Okay, Mr. Kagawa.
Mr. Kagawa: Thank you, Chair. Do we have a prior year's
comparison for August 2012 where we can kind of see if anything has changed over
the year like the investments? How much of that has gone up-and-down over the
past year? From last year to this year, our County is in much more struggling
times.
Mr. Spanski: What I can answer is that over the last three
(3) years, expenses have exceeded. This is talking about the whole picture. I do not
look at the individual fund. I look at the very bottom line on a consistent basis.
Over the last three (3) years, average, we have exceeded our revenues by sixteen
point three million dollars ($16,300,000).
Mr. Kagawa: Over the last three (3) years...
Mr. Spanski: Over last year, you spent—the prior year and
2012... I am just using the same format that I have done and how to do my cash
flow. At the end of Fiscal Year 2012— this is unaudited and this is just from my
analysis; at the end of Fiscal Year 2012, all funds we spent— not all funds. We are
excluding Housing, Board of Water, and our trust and agency funds. We ran a
negative nineteen point two million dollars ($19,200,000) in the cash flow
projections. That is what it was. At the end of Fiscal Year 2013, again unaudited,
it went from nineteen point two million dollars ($19,200,000) to twenty-seven point
two million dollars ($27,200,000); expenses exceeding revenues. If you want to go
back to 2011, expenses exceeded revenues by two point five million dollars
($2,500,000).
Mr. Kagawa: Okay. I guess what I am asking for is just
the same sheet here, the "Condition of the County Treasury for August 1, 2012" just
to compare. If you are exceeding revenues with expenses, typically for a person, the
amount in your bank account is going to go down. I just wanted to see if we could
see any differences in our bank accounts here as listed and our investments.
Investments actually, a lot of them have done well. In our retirement portfolios, we
see that for the past year, our investments have pretty much done well on a
personal level. On a County level, the same thing may have happened.
Mr. Spanski: Right, but you are comparing apples and
oranges. The IRS can invest in stocks; the County cannot.
Mr. Kagawa: Okay.
Mr. Spanski: The County is regulated by State law and a
County Resolution.
COUNCIL MEETING 48 SEPTEMBER 11, 2013
Mr. Kagawa: But the investments are affected by positive
interest rates, right?
Mr. Spanski: We are borrowing debt; we are not borrowing
on equity. When we invest, we are investing in debt. That is basically like the
Federal government and United States Treasuries. Yes, if you ever look at your
borrowing rates—for example, if you were to go out and buy a three (3) year
treasury note, your return would be about three (3) basis points. If you wanted to
borrow one (1) year treasury note, it would twelve (12) basis points. If you want to
get a two (2) year treasury note, it would be forty-one (41) basis points. That is
nothing basically.
Mr. Kagawa: I guess if I could just have that statement. I
could do follow-ups later or call you.
Mr. Spanski: Okay.
Chair Furfaro: I just want to point out to you that I believe
we had that from last year. We can get that to you. I think all you really have done
is point out to us... because we have these due bills that come at certain times, and
we have receivables that are coming at different times. It just reemphasizes my
point of how important it is for us to manage cash flow now. It was not like we had
a substantial reserve that we could draw on these balances while we had these due
bills. It is really important that we focus on managing the cash right now.
Mr. Kagawa, I will go back to you, and then Mr. Rapozo.
Mr. Kagawa: I just have a follow-up on that. All I am
saying is that if we are spending more than we are receiving, then it is certainly
going to affect something. It is going to affect our cash. I just wanted to see last
year's... as an Accountant, that is what I was taught to do and I just want to see it.
If the Staff has it, that is fine.
Chair Furfaro: We have it. What I am pointing out is to get
our SHOPO thing covered, we are actually going to draw from our reserve until we
reconcile the CAFR.
Mr. Hunt: That is correct. I think...
Chair Furfaro: Excuse me, Scott am I correct? Yes, so
please get that to Mr. Kagawa.
Mr. Hunt: I think what Dave is also saying is reflected
in the CAFR. What you are seeing is the drawdown of unassigned fund balance to
cover that gap between revenues and expenditures. Obviously, this was the year of
reckoning to where we have drawn down to leaving fifty-four thousand dollars
($54,000) left in our unassigned fund balance, plus the emergency relief fund which
we are temporary drawing into to cover a portion of that SHOPO Arbitration
Award.
Chair Furfaro: Mr. Rapozo, you have the floor.
Mr. Rapozo: Thank you, Dave. Do you have a projection
for the current Fiscal Year?
COUNCIL MEETING 49 SEPTEMBER 11, 2013
Mr. Spanski: Well, if I take over the last three (3) years
with your current spending and receivables, these charts that I just showed... I
would expect us to be probably... we have made some corrections. If you are asking
me on the spot, I am not going to own up to it. I will say that I do not recollect, but I
anticipate about sixteen million dollars ($16,000,000) to the negative.
Mr. Rapozo: So a huge decrease from last year?
Mr. Spanski: Yes.
Chair Furfaro: Let us make sure that we correct ourselves.
It is not the Council's spending; it is the Administration's Budget that is causing the
spending.
Mr. Spanski: Yes.
Chair Furfaro: Thank you for the correction.
Mr. Spanski: Right, which the Council also approves.
Mr. Rapozo: It is everybody's Budget. I think...
Chair Furfaro: Excused me for just a second, Mr. Rapozo.
That was my whole point. You keep on saying it is "our spending, our Budget." It is
a joint one. The spending control is done by the Administration. We are not signing
the checks. I am sorry for the interruption, Mr. Rapozo. I will give you back the
floor.
Mr. Rapozo: Thank you. I just wanted to point out... you
mentioned the sixteen point three million dollars ($16,300,000) average over three
(3) years, but that included 2011 which was only two point five million dollars
($2,500,000).
Mr. Spanski: Right.
Mr. Rapozo: If you look at the last two (2) years, there is
an average of over twenty-three million dollars ($23,000,000) which is substantial,
in my opinion. Hopefully we can bring that down. Even sixteen million dollars
($16,000,000)— that is still substantial, in my opinion. We have to get a handle on
these expenses.
Mr. Spanski: This is all unaudited. There are probably
some things in there that might be receivables that we have not received yet that
we are fronting.
Mr. Rapozo: If you had to pick up plus or minus, like how
they do polls— is it two percent (2%) to three percent (3%); five percent (5%) to six
percent (6%); maybe five percent (5%) accuracy, plus or minus.
Mr. Spanski: It is kind of a hard one to call.
Mr. Rapozo: That is fine.
COUNCIL MEETING 50 SEPTEMBER 11, 2013
Mr. Spanski: We do not know what is going to happen
from here forward.
Mr. Rapozo: No, I am talking about the prior years
because you were saying it is unaudited. That is pretty close to accurate.
Mr. Spanksi: What I am talking about is all funds. That is
the bottom line.
Mr. Rapozo: Okay. Thank you.
Chair Furfaro: Just to clarify, you are talking all funds?
Mr. Spanski: Yes.
Chair Furfaro: To clarify, you are also noting that the
numbers you are sharing with us are based on the fact that we still have some
receivables.
Mr. Spanski: That is correct.
Chair Furfaro: Mr. Kagawa, I will go back to you.
Mr. Kagawa: Thank you, Chair. I want to thank Staff for
getting me the report from last year as of August 13, 2012. We are comparing with
August 1, 2013. If I look at the investments total, there were one hundred eighty
million dollars ($180,000,000) million last year in investments. This year, there is
one hundred fifty-four million dollars ($154,000,000). That is a difference of
twenty-six million dollars ($26,000,000), so that is twenty-six million dollars
($26,000,000) of investments down. If I look at the cash line, we have twenty-seven
million dollars ($27,000,000) this year. Last year, we had thirty-eight million
dollars ($38,000,000) million. That is another eleven million dollars ($11,000,000)
down. That is what I am talking about; when you spend more than you spend less,
it is going to affect your bank accounts. That is what I meant. It is apples and
oranges in some sense, but it is apples and apples when you are spending more
money, your bank is going to have less money.
Mr. Spanski: Also, what you have to account for is that
you have bond fund money that you are using on our CIP projects, and you are
spending down on those, which are invested. As those bills come due, we draw
down investments and pay those.
Mr. Kagawa: Okay. Either way you look at it, our
numbers are going down and it is disturbing.
Chair Furfaro: We are talking about money for all funds,
but I think it is back to as Mr. Kagawa pointed out as to how close we have to watch
the cash position. Mr. Bynum, you have the floor.
Mr. Bynum: Steve, I think this question is for you. Is our
current cash flow balance in this Fiscal Year with the Budget we passed out of
whack or is our revenues covering our expenditures?
COUNCIL MEETING 51 SEPTEMBER 11, 2013
Mr. Hunt: No, we are still out of whack because we took
approximately eleven point eight million dollars ($11,800,000) from the reserve to
make that balance. We are not at a point where revenues equal expenditures as a
sustainable budget. We are continuing to draw from lapsed funds from prior years,
which we will likely have the luxury again for the Fiscal Year 2015. Although the
CAFR is in process and the auditors are here this week, we will not have that
information until December sometime, we hope. I anticipate of having somewhere
in the neighborhood of twelve and a half million dollars ($12,500,000) to thirteen
million dollars ($13,000,000) in lapsed funds to start out our unassigned fund
balance, but there may about money bills/requests that may eat into that before we
get into Fiscal Year 15. It just depends on how things are running.
Mr. Bynum: Thank you.
Chair Furfaro: Steve, the inventory approach to things as
what is sometimes referred as "First In, First Out (FIFO)," every year we start our
Budget with a cash carryover from the previous year.
Mr. Hunt: That is correct.
Chair Furfaro: We will not know that until our CAFR is
complete.
Mr. Hunt: Correct. I think the more challenging will be
Fiscal Year 16 because as we are budgeting closer to actual, those lapses should not
be as large. We need to find a sustainable source to start the budget with or have it
where it is in sync.
Chair Furfaro: Have we prepped our Staff where people are
realizing now that we might actually "read the fine print" on the invoice that says,
"This due bill is payable within thirty (30) days and maybe we are not going to pay
everybody on the next day after they give us their bill." I guess what I am saying is
that I hope that message is going through the accounting world to understand that
everybody is responsible to manage cash.
Mr. Hunt: Yes.
Chair Furfaro: Is that happening?
Mr. Hunt: Well, I know we are aggressively— our
biggest source of cash is the Real Property Tax...
Chair Furfaro: And the TAT.
Mr. Hunt: And the delinquencies, yes. TAT would be
second with about twelve percent (12%).
Chair Furfaro: Okay. Thank you. Members, are there any
more questions? No, okay. Thank you very much. Is there anyone in the public
who wishes to speak on this item? Seeing no one, I will call the meeting back to
order.
There being no objections, the meeting was called back to order, and
proceeded as follows:
COUNCIL MEETING 52 SEPTEMBER 11, 2013
Chair Furfaro: Is there any discussion, members?
Mr. Bynum: Yes. I want to talk about a couple of things
that have been discussed regarding finances here today. I appreciate this report
that we receive periodically. Well, I will just start with this. Earlier in the day, we
were discussing SHOPO and how we are going to fund large increases in our budget
to pay for increases in salaries. If we are going to move ahead with the CEDS
things, we are going to have finance issues. Earlier in the day, when I disagreed
with Councilmember Kagawa about the way to fund increases in County revenue,
that I did not think increases in GE tax were the best way to go, is because their
request of taxes hurt low and middle income people much more. Mr. Kagawa said,
"Well, four (4) years you have been Finance Chair and we have been spending more
money than we brought in." That is true. The public record, I have said, is
something that is very assuring to me because the public record will show that since
2008, I have made several proposals to stem the revenue declines and the loss of
revenues. I did that before I was Finance Chair, and I did it since I was Finance
Chair. The majority of the Council passed the Mayor's Budgets that resulted in
those declines. Those are the facts that are on the public record, so I do not
appreciate being held responsible for our fiscal situation when I have made multiple
proposals to stem that revenue loss in the past. We are where we are at now where
we finally started to make moves to move to a more sustainable budget, but it is
going to be challenging because we know we are going to have increased costs. The
economy is coming back and unlike the State, when the economy comes and starts
moving, the revenues for the State go up almost immediately because of GE taxes
and TAT taxes, which was the only one that had a quick response for the County.
We are not going to get a lot of increased revenues because of increased economic
activity. That is just not how our financing is structured, so it is going to fall on the
traditional methods that we have. I wanted to make those comments and say that I
think under our current Finance Chair and Mayor are addressing getting County
finances on a sustainable pattern where there are not huge fluctuations either up or
down. I believe majority of the Council is committed to that as is the
Administration. I look for better future reports. The last thing I want to say that it
is hard to take numbers out of this very complex financial picture and make
conclusions from them. Yes, our amount of investment is down over the last few
years. As Dave pointed out, that is the normal fluctuation. When you get a lot of
bond money in, you invest those moneys, and then you spend them down over years.
There are a lot of reasons that those number of investments change, not just
decisions that are made here, but the normal cycles of our financing. Thank you
very much.
Chair Furfaro: Mr. Kagawa, you have the floor.
Mr. Kagawa: Thank you, Chair. It just disturbs me that
we can always say, when we see numbers going down by the millions, that it is a
timing difference. We have to be realistic that we are not going in the right
direction. We need to think of new and creative ways of how we are going to fund
this County as we approach very challenging years. I am not blaming only
Mr. Bynum; the whole County, from the Administration and the Council has blown
through millions of dollars in reserve. We are left with a reserve, as Mr. Hunt
stated, fifty thousand dollars ($50,000) left. That is pathetic. This County needs to
have a large surplus or rainy day fund, as Mr. Bynum has always stated. We need
to have a reserve. There are numerous things that come up that you have to have
money in order to respond. One (1) of the ways that I am looking at in the future
COUNCIL MEETING 53 SEPTEMBER 11, 2013
was when the City and County had that big rail project. What did they do? They
increased five percent (5%)... half percent to the general excise tax, and they funded
this huge multi-billion dollar project, and they now have almost secured all of their
moneys they needed on the County end to match the Federal moneys. What I am
saying is that the County of Kaua`i is in crisis. We need to look at new innovative
ways to generate revenues to fund our new landfill and fund numerous things that
are coming up. A small increase to our general excise tax that can be specifically to
fund important projects that are needed in our future is just an option. I am not
saying that this has to be the way to go. I have talked to Staff and this is not the
first time that Kaua`i County has looked at generating money from the general
excise tax. There have been requests in the past. They have been successful. Our
general excise has been stuck at four point one six (4.16) for years, ever since I can
remember. I think it has been that rate from the 70's. If you go to the mainland,
the rate is six and a half percent (6.5%) to eight percent (8%). We are in a crisis
here. We could use that money here. I just think that to spin the idea and to get it
shot down is disrespectful, to me. I am looking at some new ways instead of just
Real Property Taxes that we can look forward to the future. I would just like the
Councilmembers to have an open mind, as I look to lobby the Legislature and try to
have that power to maybe try and bail us out, so we can actually build our surplus
back as it was in the past or even more. Thank you
Chair Furfaro: I have a couple of comments, and then I
would like to break for lunch. How much time did Mr. Bynum have during his
discussion? Okay. You have four (4) minutes to continue. Go ahead.
Mr. Bynum: It is important to be accurate. This County
did not blow through the surplus; we gave it away. Revenues started falling, we
made no adjustments to those rates, and all of that money did not get blown away
by— in fairness to the Mayor, when the economic crisis came, he gave us reduced
budgets for two (2) or three (3) years in a row. We did cut services. We furloughed
workers. We did a lot of things to reduce our expenses, but we allowed our revenues
to plummet and those revenues went. This is not an opinion; this is a fact. It is not
something that we spent money on, it is money that we never received because we
allowed certain classes of taxes to get very large decreases during that period. It is
important to be accurate. We are the only State that has a GE tax of four point one
six (4.16). The mainland taxes of six percent (6%) to eight percent (8%) are sales
taxes that do not go on services. The GE tax has been... if you compare it to those
taxes, is more than twelve percent (12%). It is a fact that increases in sales taxes
hurt poor people first. The less money you make, the more you are struggling to
make ends meet; the more GE taxes, even worse than sales taxes, take from you.
We are the only State that you pay tax on a haircut. We are the only State you pay
tax on the services of your car. There are thousands of them. It is just important to
be accurate.
Chair Furfaro: Okay, I am going to bring us all back to the
discussion here. I want to make sure that you all understand. I am telling this
from a business standpoint. The agenda item was a Treasurer's Report, just so we
are all very clear. You have to understand that a financial report is different from a
cash flow report. Here is the major piece that is different for Kaua`i; eighty-one
percent (81%) of our income comes from property taxes. It only comes to us in
February and in August. That is two (2) months. Then we have thirteen percent
(13%) of our income that comes to us from the Transient Accommodations Tax.
That only comes to us in May and December. I have just shared with you that at
this particular rate, ninety-four percent (94%) of our income only comes in four (4)
COUNCIL MEETING 54 SEPTEMBER 11, 2013
of the twelve (12) months of the year, but we have to pay salaries; we have to pay
medical benefits; we have to pay fuel allocation; and we have to pay bills during the
month. Ninety-three percent (93%) of our money only comes in those four (4)
months. That terminology is called "cash flow." It is completely different from
reading a balance sheet. It is paying our bills on a timely basis with or without
whatever the case may be, not having any reserve because that is a real statement.
We have very limited resources in this County right now.
The other part I want to point out is timing. We have got to make sure that
collections, our bad debt, is collected on a regular basis to provide us that money.
Also, when you read the Treasurer's Report, he is also showing us the spending we
are doing on bond money. Bond money is the money we borrowed to have capital
projects going forward. There is no revenue source for that. In fact, what we have
is a substantial amount of about six million dollars ($6,000,000) of our budget that
goes to pay the debt for the money we borrowed. You have to be able to interpret all
of these things. One (1) thing I learned a long time ago is that cash flow is the best
picture. I did this is Rarotonga once. I did not have enough money to pay the
payroll, so I went to the members of Parliament and they say, "You either put some
money in the treasury or you are on the next plane out," because I would be issuing
bounced checks. There is only one (1) flight a week from the Cook Islands.
The motion to receive C 2013-311 for the record was then put, and
unanimously carried.
Chair Furfaro: We are going to lunch.
There being no objections, the meeting recessed at 12:38 p.m.
The meeting reconvened at 1:40 p.m., and proceeded as follows:
Chair Furfaro: Aloha. We are back from our lunch break.
As soon as we have the full Council here, I will ask to go to the Humane Society
item. In the meantime, let us just go right through the items here.
CLAIMS:
C 2013-313 Communication (08/22/2013) from the Deputy County Clerk,
transmitting a claim filed against the County of Kaua`i by DTRIC Insurance Co.
Ltd., on behalf of Aqua Engineers, for damage to their vehicle, pursuant to
Section 23.06, Charter of the County of Kaua`i: Mr. Rapozo moved to refer
C 2013-313 to the County Attorney's Office for disposition and/or report back to the
Council, seconded by Ms. Yukimura, and unanimously carried.
C 2013-314 Communication (08/29/2013) from the Deputy County Clerk,
transmitting a claim filed against the County of Kaua`i by Richard and Melva
Arakaki, for damages to their property, pursuant to Section 23.06, Charter of the
County of Kaua`i; Mr. Rapozo moved to refer C 2013-314 to the County Attorney's
Office for disposition and/or report back to the Council, seconded by Ms. Yukimura,
and unanimously carried.
C 2013-315 Communication (09/04/2013) from the Deputy County Clerk,
transmitting a claim filed against the County of Kauai by Eileen Shavelson, for
damages arising out of the alleged negligence and discrimination of the Kaua`i
Police Department, pursuant to Section 23.06, Charter of the County of Kaua`i:
COUNCIL MEETING 55 SEPTEMBER 11, 2013
Mr. Rapozo moved to refer C 2013-315 to the County Attorney's Office for
disposition and/or report back to the Council, seconded by Ms. Yukimura, and
unanimously carried.
COMMITTEE REPORTS:
PLANNING COMMITTEE:
A report (No. CR-PL 2013-08) submitted by the Planning Committee,
recommending that the following be received for the record:
"PL 2013-04 Communication (08/22/2013) from Committee Chair
Nakamura, requesting the presence of the Director of Planning, to provide a
briefing regarding the Kahuaina Subdivision, Phase II, including the
subdivision approval process, approved density, conditions of approval and
subdivision maps. This briefing shall also include the determination of the
location and terms of the Grant of Pedestrian and Parking Easement from
Falko Partners, LLC, including the parking area's distance to the shoreline,
the number of parking stalls and responsibility for the maintenance of the
public access,"
Mr. Rapozo moved for approval of the report, seconded by Ms. Nakamura,
and carried by a 7:0:0 vote.
A report (No. CR-PL 2013-09) submitted by the Planning Committee,
recommending that the following be received for the record:
"Communication (08/28/2013) from Committee Chair Nakamura,
requesting the presence of the Director of Planning, to provide a status report
on the renewal of Transient Vacation Rental (TVR) certificates and a briefing
regarding any administrative or court proceeding involving TVR applications,
certificates or operations,"
Mr. Rapozo moved for approval of the report, seconded by Ms. Nakamura,
and carried by a 7:0:0 vote.
ECONOMIC DEVELOPMENT (SUSTAINABILITY / AGRICULTURE / FOOD /
ENERGY) & INTERGOVERNMENTAL RELATIONS COMMITTEE:
A report (No. CR-EDR 2013-05) submitted by the Planning Committee,
recommending that the following be approved on second and final reading:
"EDR 2013-04 Communication (07/29/2013) from Councilmember
Rapozo, transmitting for Council consideration, a proposed Bill for an Act to
Repeal Section 143-16 of the Hawai`i Revised Statutes (HRS) Relating to the
Contract between the County of Kaua`i and Kaua`i Humane Society, for
inclusion in the 2014 County of Kaua`i Legislative Package,"
Mr. Hooser moved for approval of the report, seconded by Mr. Rapozo, and
carried by a 7:0:0 vote.
COUNCIL MEETING 56 SEPTEMBER 11, 2013
COMMITTEE OF THE WHOLE:
A report (No. CR-COW 2013-17) submitted by the Planning Committee,
recommending that the following be approved:
"A BILL FOR AN ORDINANCE APPROVING A COLLECTIVE
BARGAINING AGREEMENT FOR BARGAINING UNIT 12 BETWEEN
JULY 1, 2011 AND JUNE 30, 2017,"
Mr. Rapozo moved for approval of the report, seconded by Ms. Yukimura, and
carried by a 7:0:0 vote.
RESOLUTIONS:
Resolution No. 2013-67 — RESOLUTION AMENDING RESOLUTION NO.
2013-02 RELATING TO THE RULES OF THE COUNCIL OF THE COUNTY OF
KAUAI FOR THE ORGANIZATION OF COMMITTEES AND THE
TRANSACTION OF BUSINESS: Mr. Rapozo moved for adoption of
Resolution No. 2013-67 for discussion, seconded by Mr. Bynum.
Chair Furfaro: Okay. There has been a motion to approve
and a second for the purpose of discussion. The Chair will recognize Councilwoman
Yukimura.
Ms. Yukimura: This was a proposed change to the rules for
expert testimony. I am sorry I have not done all of the work. I think we are
working on it. Can we just defer it for another time?
Chair Furfaro: We can defer it if you would like.
Ms. Yukimura: Yes, please.
Ms. Yukimura moved to defer Resolution No. 2013-67, seconded by
Mr. Rapozo, and unanimously carried.
Resolution No. 2013-68 — RESOLUTION ESTABLISHING "AUTHORIZED
PARKING ONLY — TOW AWAY ZONE" (NO-PARKING ZONE) AT BOTH
PARKING LOTS ADJACENT TO THE COUNTY OF KAUAI POLICE
DEPARTMENT BUILDING AND EMERGENCY OPERATIONS CENTER
BUILDING, LIHU`E DISTRICT, COUNTY OF KAUAI
JADE K. FOUNTAIN-TANIGAWA: The Council received a memo
requesting a deferral.
Chair Furfaro: Yes. We did receive a memorandum from
the County Engineer wanting to have further discussion with Police Department,
Civil Defense, and the Prosecutor's Office. They have asked for a deferral.
Mr. Rapozo moved to defer Resolution No. 2013-68, seconded by Mr. Kagawa,
and unanimously carried.
Chair Furfaro: Thank you. Let us go back to item
EDR 2013-04, please.
COUNCIL MEETING 57 SEPTEMBER 11, 2013
There being no objections, EDR 2013-04 was taken out of the order.
COMMUNICATIONS:
EDR 2013-04 Communication (07/29/2013) from Councilmember Rapozo,
transmitting for Council consideration, a proposed Bill for an Act to Repeal Section
143-16 of the Hawai`i Revised Statutes (HRS) Relating to the Contract between the
County of Kaua`i and Kaua`i Humane Society, for inclusion in the 2014 County of
Kaua`i Legislative Package: Mr. Rapozo moved to approve EDR 2013-04, seconded
by Mr. Kagawa.
Chair Furfaro: The Chair is going to recognize Mr. Rapozo.
Would you like to add anything else?
Mr. Rapozo: No, I think we had the discussion, unless
anyone has any questions. Again, I am not sure why this law was passed back in
the 50s, I believe, before Statehood. As I understand it, what is considered "special
law" is no longer even allowed in our State under the current Constitution.
However, this law would be valid simply because it was done prior to the
Constitution. In my mind, it does create some inequity throughout the State as it
relates to this function. I would ask that, as I stated in the last meeting, it is more
of a housekeeping matter that we would bring parity to the State. Thank you.
Chair Furfaro: Are there any other comments? Is there
anyone in the public who wants to testify on this matter? Seeing no one, let us call
for a vote.
The motion to approve EDR 2013-04 was then put, and carried by a 4:1:2 vote
(Mr. Hooser voting no, Mr. Bynum and Ms. Yukimura silent.)
Chair Furfaro: Thank you. Next item, please.
Ms. Fountain-Tanigawa: Chair, if we go back to page 5,
Resolution No. 2013-68, the motion was to defer. The memo asked that it be
deferred until October 9th.
Chair Furfaro: Okay. We had a date-specific deferral.
Ms. Fountain-Tanigawa: Yes.
Chair Furfaro: Okay. Everyone is okay with that? I will
call for the vote again. This is the Police parking area as it dealt with Engineering,
Civil Defense, the Prosecutor's Office, and Police wanting to reallocate some of that.
Mr. Kagawa moved to defer Resolution No. 2013-68 to October 9, 2013,
seconded by Mr. Bynum, and unanimously carried.
RESOLUTIONS:
Resolution No. 2013-69 — RESOLUTION MODIFYING PARKING
RESTRICTIONS, ESTABLISHING REVERSE ANGLE PARKING, _ AND
ESTABLISHING BIKE LANES ON RICE STREET AND UMI STREET, LIHU`E
DISTRICT, COUNTY OF KAUAI: Mr. Bynum moved for adoption of
Resolution No. 2013-69, seconded by Ms. Nakamura.
COUNCIL MEETING 58 SEPTEMBER 11, 2013
Chair Furfaro: I think we are going to need Public Works for
this item. Are they coming over? Yes.
Mr. Rapozo: Okay. I was going to suggest that we just go
to the Committee.
Chair Furfaro: We had a motion and a second, but we will
go to the next item here.
Resolution No. 2013-70 — RESOLUTION AUTHORIZING THE MAYOR OR
THE DIRECTOR OF FINANCE OF THE COUNTY OF KAUAI TO ENTER INTO
AN INTERGOVERNMENTAL AGREEMENT WITH THE STATE OF HAWAII,
DEPARTMENT OF HEALTH, FOR A LOAN FROM THE STATE WATER
POLLUTION CONTROL REVOLVING FUND FOR THE `ELE`ELE
WASTEWATER TREATMENT PLANT IMPROVEMENTS,
PROJECT NO. C150050-11: Mr. Kagawa moved for adoption of
Resolution No. 2013-70, seconded by Mr. Bynum.
Chair Furfaro: To the Clerk's Office, I might have missed
this but do we have an indication of the size of the loan that they want from the
Revolving Fund? Okay. I have clarification here. The original approval we gave
them was for three point six million dollars ($3,600,000). The bids for the work
came in at five million dollars ($5,000,000), so this is asking for an additional one
point four million dollars ($1,400,000), which is a total of five million dollars
($5,000,000) to cover the preliminary numbers that they have.
Mr. Kagawa: Chair, can I just get a brief update from
Larry on this?
Chair Furfaro: From Larry on the wastewater?
Mr. Kagawa: Yes.
Chair Furfaro: I guess we could. Larry, can you have a seat,
please? Larry, currently we are dealing with the application from the County of
Kaua`i to the State of Hawai`i's Department of Health for additional moneys for the
Revolving Fund. If I recall right, we did approve three point six million dollars
($3,600,000). Now we are asking for an additional one point four million dollars
($1,400,000) for a total loan of five million dollars ($5,000,000). This was, as we just
got some narrative on, based on the fact that the bid work came in relatively high.
LARRY DILL, P.E., County Engineer: For the record, Larry Dill,
County Engineer. That is correct, we just got the bids. Council already approved
the Resolution in the amount you just mentioned, but because the bids came in
high... also, we need to budget for Construction Management (CM) work for this
project since we do not have in-house staff that has availability to take care of this.
We need to increase the amount of the State Revolving Fund (SRF).
Chair Furfaro: You are basically saying that the only
change in the scope was this construction management addition, but why did we
come in so far from what we thought it was going to be?
COUNCIL MEETING 59 SEPTEMBER 11, 2013
Mr. Dill: I have Mr. Agena here from the Wastewater
Division, so I will ask him to respond to that.
Chair Furfaro: Okay. Basically, this is representing almost
a thirty percent (30%) difference in what your original number was.
ERIC AGENA, Public Works Wastewater Division, Civil Engineer VI: That
is correct. For the record, Eric Agena with the Wastewater Division. I kind of went
over this a little bit with our consultants who did the initial estimate. It is a mix of
things. I do not want to go into too much detail, but basically some of the
equipment that they originally specified, the guys that gave them the specs on it
later found that they needed to revise, and make some revisions. That revision
alone ended up actually doubling that particular line item, which maybe added
another two fifty thousand dollars ($250,000) there. There was some additional
work that the consultants actually really not sure how to—what really is the reason
behind the number being so much greater, except that it was consistent for both
bidders that came in, and it was still above what they typically see on projects of
similar scope. They are not sure how to attribute those increases, which that also
was another two fifty thousand dollars ($250,000) difference in cost.
Chair Furfaro: Did we convey to them that if they are not
sure, and they are the consultants, that they gave us an intangible number for the
product; did we tell them that we might give them an intangible contract? I am
serious. Those guys are thirty-two percent (32%) off from the original number.
Mr. Agena: They did look at their number again. This is
only for specific line items; it is not overall for the whole project.
Chair Furfaro: They cannot identify the line item?
Mr. Agenda: They did. For example, one (1) of them was
the electrical work which originally based on the cost of the material, they saw it
was being around about two hundred thousand dollars ($200,000). The bid was
pretty similar for both bidders that came in. There were only two (2) bidders on the
project, which actually surprised us because we expected more because of the size of
the project. There were two (2) bidders. For both of them, for a two hundred
thousand dollar ($200,000) line item, ended up being four hundred the line item
ended up about four hundred thousand dollars ($400,000). I did double check with
them and they were not sure why there was that big of a delta because, historically,
they did see that the numbers were different. Granted, this may be because what
the numbers they are looking at are for projects like on Oahu where there is
considerable more competition and aggressive bidding.
Chair Furfaro: Mr. Agena, this is not directed to you, but
you answered two hundred thousand dollars ($200,000) of my question. We still
have one point two million dollars ($1,200,000) to go, and I know the plane tickets
are not that expensive. This is unacceptable.
Mr. Dill: Chair, some of the numbers as we budgeted
for CM, which was not included before. How much did we budget for CM?
Mr. Agena: For this project?
COUNCIL MEETING 60 SEPTEMBER 11, 2013
Mr. Dill: Yes. Anyway, the addition of CM money was
a significant addition, as well as the changes that Mr. Agena mentioned. Our
Engineers often give us estimates on projects. Estimates are estimates by their
nature. The rest of the estimates that were provided were fairly reasonable
compared to the bids we got. There are occasions when the estimates do not come
in as expected. It is often difficult with the limited number of bidders to come to a
reasoning why.
Chair Furfaro: Larry, this is not directed to you and
Mr. Agena, but I am going to tell you that I just had this discussion with the
Finance team and the Treasurer about making sure that we sharpen the pencil
going forward because we are not in a real strong cash position. If I were to do a
project release, and you have done project releases with me before, I would put
twelve percent (12%) or fifteen percent (15%) in for construction management. You
have now given me another answer to about one hundred twenty thousand dollars
($120,000). We are still looking for one point one million dollars ($1,100,000).
Mr. Dill: For the CM number— my recollection is
bigger than that but I apologize because I do not have the numbers with me.
Chair Furfaro: My point is that we have to get closer to it.
Mr. Dill: I understand and I agree with you.
Chair Furfaro: We have to get closer to it.
Mr. Dill: Yes.
Chair Furfaro: Mr. Kagawa, you have the floor.
Mr. Kagawa: I just want to get an overview of what the
five million dollars ($5,000,000) will be doing. Is it to just upgrade an old system
that needed to be improved? Are we improving and expanding for future
customers?
Mr. Agena: What this does is take care of a number of
much needed upgrades at the Plant. This ends some redundancy to some
equipment we should have had, and for whatever reason, we did not necessarily
have as much. When I say redundancy, I mean that the Department of Health
requires that there would so much— you have to have backup in place if something
was to go down. It provides for that. It improves our disinfection system. It takes
us away from using chlorine gas, which by itself is a more hazardous system, so it
takes us away from that. There is improved dewatering capability now at the
facility with these proposed improvements. There are significant electrical
upgrades at the plant, and that is what is actually costing some money because to
upgrade all of the electrical facilities, you have to do temporary electrical
replacement and reconnect to new ones. All of those steps end up costing money. It
also does some upgrades at a couple of pump stations to improve the backup power
over there.
Mr. Dill: I will answer your question, too, if I may?
Mr. Kagawa: Go ahead.
COUNCIL MEETING 61 SEPTEMBER 11, 2013
Mr. Dill: It will not, in and of itself, expand the
capacity of the plant. It improves the operations, replaces older obsolete equipment,
and upgrades a couple of the processes to operate better and more efficiently, but
the actual capacity of the plant will not be expanded by this expenditure.
Mr. Kagawa: The capacity is there to handle some
additional customers?
Mr. Agena: As it stands right now, yes
Mr. Kagawa: Because we have some new proposed
developments in `Ele`ele.
Mr. Agena: Basically, what it is doing is implementing
the near-term improvements that were identified in the facility plan that was done
back in 2008, I think.
Mr. Kagawa: Have we had any recent spills or mishaps at
the `Ele`ele Plant?
Mr. Agena: Nothing major. There are typically other
small things that will happen here and there, but nothing that was really
substantial, and nothing to due to a major equipment failure or that type of thing.
Mr. Kagawa: What were the basic reasons?
Mr. Agena: One (1) for example is that a contractor was
working at the pump station and cut into a line that was actually believed to be
drained, but it was not. We had all of the pump trucks onsite already so we were
able to quickly address it before it became an issue.
Mr. Kagawa: Thank you.
Chair Furfaro: Larry, I understand what you are saying.
The fact of the matter is that we are going from chlorine gas to maybe ultra violet
for treatment, whatever you are doing there. I do know my way around wastewater
treatment plants a little bit. We are not really enlarging capacity, but the reality is
that everything you talked about that we are doing should have been in the bid
scope. Was there a major change in the bid scope?
Mr. Dill: No, it was in the scope.
Chair Furfaro: I want to ask you to send a message to the
guys— this is not legalized gambling over here. They are just gambling and
throwing a number out. I expect our Engineering people to scrutinize it a little bit.
Larry, you have to agree that that is a huge variance; one point four million dollars
($1,400,000). What you just shared with me, I can account for about three hundred
twenty thousand dollars ($320,000). Doug, in the audience, Buildings needs to be
closer on the mark. For a contingency plan, you might put ten percent (10%) to
fifteen percent (15%) as a contingency on top of what the bid was. Did we put a
contingency in this?
Mr. Agena: Yes.
COUNCIL MEETING 62 SEPTEMBER 11, 2013
Chair Furfaro: How much? What percentage?
Mr. Agena: In that range, ten percent (10%) to fifteen
percent (15%).
Chair Furfaro: We are still that high. I am just saying that
we have got to get closer, Larry.
Mr. Dill: I do agree with you, Chair, but I also will say
that sometimes the bids we get—and we only had two (2) bids like this; they are
just beyond our control. Sometimes there is not a lot of control we have in spite of
getting what is a good estimate. I will say that I do agree with you and we will try
to do a better job with that.
Chair Furfaro: That is what I am asking for.
Mr. Rapozo: Who is the consultant?
Mr. Agena: For this job, it was R. M. Towill. Just to add
something, the difference between the two (2) bids that we got was over one million
dollars ($1,000,000). The low bidder was about four million dollars ($4,000,000) and
the high bidder was about five point two million dollars ($5,200,000). There was a
very big range. Again, when we did forensically look at the bids... there were a
number of line items in the bid.
Mr. Rapozo: You brought up one (1) of them, which were
the electrical services.
Mr. Agena: Yes.
Mr. Rapozo: We know that was one (1) that was...
Mr. Agena: Electrical equipment actually.
Mr. Rapozo: You said that was about...
Mr. Agena: It was about two hundred fifty thousand
dollars ($250,000) difference.
Mr. Rapozo: What would be another one that was
significant?
Mr. Agena: I do not know how detailed you want me to
get.
Mr. Rapozo: The thing is that if we are hiring a
consultant that is using prices that are from Honolulu, then like the Chair said, we
probably need to be looking for another consultant.
Mr. Agena: That was just speculation on my part.
Mr. Rapozo: It is rough when you only get two (2) bidders
because you can gouge the County. The other question is can we even say, "Hey, let
us scratch the bids and put it out again." I do not know what our options are, but it
COUNCIL MEETING 63 SEPTEMBER 11, 2013
is like we are held hostage because we only get two (2) bidders. For all you know,
the two (2) bidders could be in cahoots working together to drive the bid up. Did we
pick the low bidder or the high bidder?
Mr. Agena: The lower bidder.
Mr. Rapozo: Larry, you talked about the contract
management being a significant amount...
Mr. Dill: Construction management.
Mr. Rapozo: Yes, construction management. How much
is that?
Mr. Agena: That is still being negotiated.
Mr. Dill: Okay. We do not have a number for that yet.
Mr. Rapozo: It is not in this figure?
Mr. Dill: It is included in the amount that we are
coming to the Council for today.
Mr. Rapozo: How does that work?
Mr. Agena: The number is not set yet. We are still in
negotiation. In fact, we just started the negotiation.
Mr. Dill: We must have budgeted...
Mr. Rapozo: I do not get it. How do you come to us to ask
for money and do not even know what that number is. Is it because it is not to
exceed five million dollars ($5,000,000)?
Mr. Dill: That is correct.
Mr. Rapozo: What is the actual contract price? What did
we award the contract? How much was that?
Mr. Agena: It is not awarded yet, but the amount is
roughly four million dollars ($4,000,000).
Mr. Rapozo: Okay, so four million dollars ($4,000,000)
and we have one million dollars ($1,000,000) to play with, right? You have the
ability to go get another one million dollars ($1,000,000) from the Revolving Fund?
Mr. Dill: Yes.
Mr. Rapozo: What is the construction management
amount? What would that be? What kind of number are we looking at? Who is the
recipient of that money?
Mr. Dill: We do not have a contractor for that yet.
COUNCIL MEETING 64 SEPTEMBER 11, 2013
Mr. Rapozo: You said you were negotiating already?
Mr. Agena: Yes. What happens with construction
management is that we go out with via Requests For Proposals (RFP), so we just
review the resumes of the various guys that are putting in to do the construction
management. Based on their resumes, we select one (1) guy and negotiate the fees
from there.
Mr. Rapozo: What typically would the construction
management fee be on a job like this?
Mr. Dill: Ten percent (10%) to fifteen percent (15%).
Mr. Rapozo: Okay, so that would be four hundred
thousand dollars ($400,000) to six hundred thousand dollars ($600,000)?
Mr. Dill: Yes.
Mr. Rapozo: Wow. Okay. Well, I guess I would share
some of the concerns of the Chair. I am not sure if you know what the track record
is of this consultant. Have you folks used him before?
Mr. Agena: Yes, and they are a good and conscientious
consultant.
Mr. Rapozo: How are the variances? Do we track the
variances in their estimates? Thirty percent (30%) is huge. It really is.
Mr. Agena: They also would refer to their sub-
consultants for their various numbers. They refer to their electrical sub to come up
with those estimates and things like that.
Mr. Rapozo: I know, but if I was signing my name to the
consultant report, I would make sure that those numbers are pretty accurate. If it
is more than double, something is not right. I think you are probably right that
they are relying on industry estimates, like Honolulu estimates.
Mr. Agena: Yes.
Mr. Rapozo: Thank you, Mr. Chair.
Chair Furfaro: JoAnn, you have the floor.
Ms. Yukimura: Thank you, Mr. Chair. I have the same
kinds of concerns that the Chair has. Can you submit, even assuming we pass this
today, a breakdown of the additional costs?
Mr. Dill: Sure, we can do that.
Ms. Yukimura: Regarding the Standard Performance
Evaluation Corporation (SPEC) revisions on the equipment, I hope they were not
brand name requirements.
COUNCIL MEETING 65 SEPTEMBER 11, 2013
Mr. Agena: Sorry, I do not want to go into too much
detail, but with that particular situation— because that is one (1) of the bigger cost
difference items. Some of the challenges that we have with this project is that we
have limited space in which to put a lot of this new equipment. For several of them,
admittedly, there were not a lot of options available that could fit into the size
constraints that we have. The particular item I mentioned was blowers. The
manufacturer that they consulted with said, "This is what we can provide. It will fit
in the space." They figured that it would run about roughly eighty-five thousand
dollars ($85,000) each, and about a total of one hundred sixty thousand dollars
($160,000). What ended up happening was when it was actually now time to bid,
that manufacturer said they are starting to see some issues with what they had
originally proposed that would have worked, so they were no longer going to bid.
The next manufacturer that had something that could work, their price was two
hundred eighty thousand dollars ($280,000) just for the equipment, which was a
significant difference from the one hundred sixty thousand dollars ($160,000). In
that case, when I talked with the consultant, they did base their number on what
information they could gather. They did get the information and checked with the
manufacturer, but that is just what ended happening with that particular line item.
Ms. Yukimura: It was not a matter of dimensions of space
that the consultant overlooked?
Mr. Agena: No. There was the dimensions as well as the
performance, the actual capabilities of the equipment that they were specifying.
The combination of the two (2)... not many manufacturers can actually meet.
Ms. Yukimura: Okay. Thank you for the explanation. Is it
also your sense that part of this is because the economy is revving up, too? Maybe
on O`ahu?
Mr. Dill: That is speculation, but I think there is some
truth to that, yes.
Ms. Yukimura: And the fact that there were only two (2)
bidders and they come from O`ahu, right?
Mr. Agena: Yes.
Ms. Yukimura: If that economy is revving up, then that may
explain some of the lesser interest in projects like this. Thank you very much.
Mr. Bynum: Councilmember Yukimura kind of went
where I was going about whether you had any speculation of trends. There was this
period where every bid we got was substantially higher, and then the period that
every bid we got was coming in lower, and we liked that. I was going to ask if this
was part of a trend, and your answer was that it could be. This is some pretty
specialized work that is involved here. How many firms could potentially bid? Are
there Kauai based firms who have that expertise?
Mr. Dill: Maybe one (1) comes to mind.
Mr. Bynum: They were not a bidder?
Mr. Dill: No.
COUNCIL MEETING 66 SEPTEMBER 11, 2013
Mr. Bynum: I do not think you can say who the bidders
were, right? Is that confidential at this point?
Mr. Dill: I do not think we can until...
Mr. Agena: The bidders are. It is public record already...
Mr. Bynum: Okay. Who were the two (2) bidders?
Mr. Agena: Oceanic Companies is the low, and I believe
the second was— I am about eighty percent (80%) certain, but I believe it was
Bodell Construction.
Mr. Bynum: Thank you very much.
Chair Furfaro: Vice Chair, you have the floor.
Ms. Nakamura: The source of the funding is the low-interest
loan from State of Hawai`i Water Pollution Control Revolving fund. I was
wondering about the terms and interest rate of that loan.
Mr. Agena: Well, that is a nice part with this one and
why we would like to move forward if we could. What happened was that relatively
recently, they increased the interest rate one percent (1%). That is going from point
seven five percent (0.75%) to one percent (1%), but it still went up. They are
actually willing to kind of"grandfather in" this project and still give it to us at point
seven five percent (0.75%). Another thing to point out is that we did not know when
we came in with the original request for the loan, when we got the final terms and
conditions of the existing loan, one million dollars ($1,000,000) of that is principal
forgiven. When we look at it that way, net; we are kind of almost at the same
amount of that we were borrowing to begin with.
Ms. Nakamura: That was going to be my next question. Did
we budget the additional?
Mr. Agena: Yes. We actually have a couple of projects
that are on the books, past SRF projects, that are reaching the tail-end of the term.
One (1) of them is a twenty (20) year term, one (1) of them is in its 20th year this
year, and two (2) more are in its 18th year, so it is starting to free up some space.
Ms. Nakamura: Thank you.
Chair Furfaro: This change on the blowers, one hundred
twenty-five thousand dollars ($125,000); construction management, four hundred
thousand dollars ($400,000)... what was the other one?
Mr. Agena: The electrical.
Chair Furfaro: The electrical was...
Mr. Agena: I guess you could say "equipment."
COUNCIL MEETING 67 SEPTEMBER 11, 2013
Chair Furfaro: That was another two hundred thousand
dollars ($200,000). You have answered about eight hundred twenty-five thousand
dollars ($825,000) of the one point four million dollars ($1,400,000), but it is still
very alarming. Let me ask you, when we bid now and we get Honolulu... do we ask
them to disclose their costs as it relates to housing for their workforce that is here?
Mr. Dill: Typically not.
Chair Furfaro: Maybe it is something that we might want to
consider which is being able to show a breakdown of a subcategory.
Mr. Dill: Okay.
Chair Furfaro: Especially for travel and housing, if we are
ending up—is this a job that Aqua would have bid on?
Mr. Dill: That is the firm I had in mind when I
mentioned there may be one (1) firm on Kaua`i interested, but we did not receive a
bid.
Chair Furfaro: Okay.
Mr. Dill: Briant Construction actually because they
are construction.
Chair Furfaro: Okay. Are there any more questions for the
gentlemen? If not, we are going call this back to order. Thank you very much.
There being no objections, the meeting was called back to order, and
proceeded as follows:
The motion to adopt Resolution No. 2013-70 was then put, and carried by the
following vote:
FOR ADOPTION: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Yukimura, Furfaro TOTAL – 7,
AGAINST ADOPTION: None TOTAL – 0,
EXCUSED & NOT VOTING: None TOTAL – 0,
RECUSED & NOT VOTING: None TOTAL – 0.
Chair Furfaro: Thank you for coming over, Mr. Agena. You
have approval from the Council right now.
Mr. Agena: Thank you.
Chair Furfaro: Let us go back to Resolution No. 2013-69.
Mr. Dill, can you come up for some question and answer? Were you going to make a
presentation or just answer question and answer from the group? Do you have
anything to present to us?
There being no objections, the rules were suspended.
Mr. Dill: Chair, I can just briefly say that the
Resolution is pretty self-explanatory. There are three (3) bullets on the front page
COUNCIL MEETING 68 SEPTEMBER 11, 2013
that we are proposing to modify the parking restrictions on street parking stalls on
the south side of Rice, right across the street here from the Historic County
Building. Both were problematic as far as causing traffic backups on Rice Street.
Initially, we were looking at banning parking all together in that location, but had
some discussions with the two (2) businesses there; Lihu`e Missionary Church and
Prosser Realty. In working with them, we modified the proposal to what you see
here before you, which is allowing parking on the weekends and just prohibiting
parking between 6:00 a.m. and 6:00 p.m. I will say that I have been in further
discussions with the church, and they have some concerns about loading and
unloading options, but I let them know that we have to deal with traffic issues. We
also met with the Kaua`i Police Department about this a couple of times. They also
support this and they are on board. We ended up with the Resolution that we have
before you.
The second item is since we are taking parking way over there, and proposing
some new parking on Umi Street, we are proposing for the first time on Kaua`i to
implement reverse back-in parking. It is another thing that we coordinated with
the Police about because it is a new thing for everybody, including them. We
anticipate a little bit of a learning curve for folks as they see that and implement
that for the first time, but we believe from our studies and discussions with folks
that we brought over to look at complete streets issues, it is more efficient and a
safer way of doing back-in parking. The problem with head-in parking, as we have
all experienced, is when you try to back out onto the road, you have very limited
vision and sight distance capability, whereas when you back-in to a spot, you are
already in the road. People see you and you can see other people when you perform
that maneuver. When you pull out, you get better opportunities to see other cars
and other cars to see you. We are proposing some back-in parking over there and
also taking the opportunity to stripe some bicycle lanes on Umi Street while we are
doing all of that work. That is just a brief presentation.
Chair Furfaro: First of all, I want to thank Mr. Kagawa who
pointed out that the removal of a couple of those parking stalls during the Monday
through Friday business hour has made a huge difference. Have we made any
decision about the thirty (30) second turn light so people can make a left hand turn?
Mr. Dill: We are moving forward with something but
we have not quite got it finalized. I am reluctant to say more than that at this time.
Chair Furfaro: Okay, but you are looking at something?
Mr. Dill: Yes.
Chair Furfaro: That was another part of Mr. Kagawa's
suggestion along with Joe Rosa. You are looking at that?
Mr. Dill: Yes.
Chair Furfaro: Mr. Kagawa, you have the floor.
Mr. Kagawa: Thank you, Larry. I think we let the public
suffer for about a week as soon as we closed this street. After the second week, we
worked out an agreement where we shut off parking on Rice Street, and it
significantly improved the traffic during the peak hours. I want to thank you for
that. I never agreed or voted for disclosure here, but it looks like the public has
COUNCIL MEETING 69 SEPTEMBER 11, 2013
adjusted. I think your proposal for Rice Street is fine with me. It is a compromise
to some sort with the church and the businesses at Prosser. I know for the church
that it will benefit a little bit with having night activities and they can have the
loading and unloading adjacent to the church. For the other one, I just wanted to
show on the screen the effect on Umi Street for the public. Larry, your intention
was that you would open up some street parking along Umi Street, which is right in
front of the Central Pacific Bank (CPB) building here?
Mr. Dill: Correct.
Mr. Kagawa: My only concern is back-in angle parking
only. As I teach driver's education, I became more alert to people's parking habits.
I can just visually tell you that a lot of people have trouble parking straight in on
Kaua`i. I totally agree that it really about safety, but as they attempt their back-in
parking, will that stop the flow of traffic? In reverse parking, you need to get your
vehicle in front of the space, and then reverse backwards. Sometimes as you
reverse backwards, the front of your vehicle will swing more open towards the road
as you maneuver your car into the stall. I am wondering if as they are reverse
parking into the stalls right there— there are five (5) of them, I believe. Will they
affect traffic on Umi Street?
Mr. Dill: Definitely, as that parking maneuver is
made, any vehicles behind them will definitely have to stop in order to allow that to
happen.
Mr. Kagawa: So that will not be a good thing if there are a
lot of cars trying to go pick up their children from Wilcox when it is peak time at
2:00 p.m. and the children just finished school. We have after lunch traffic as well,
and cars are turning left. That is my only concern. I would say that parallel
parking would be the best, but with parallel parking, we would only get two (2)
stalls?
Mr. Dill: Yes.
Mr. Kagawa: With the parallel stall, it is not as long so I
think you can do it without impacting the right lane traffic.
Mr. Dill: There would probably be less impact, but as
you know, we get fewer stalls that way. Part of the compromise with the businesses
on Rice was that we would be adding additional parking here and providing more
crosswalks and sidewalks for them to safely get to their locations. You are right
because there will be impacts here, but we feel it is the best compromise with the
available opportunities there.
Mr. Kagawa: Larry, the main thing I think, which worked
well for this situation here, was that your observation and your willingness to work
with Councilmembers. We went out there and looked at it. You looked at it with
the Chair. I think we need to keep a close eye on this situation because if it starts
to impact the traffic turning left on Umi, and if it backs up the flow there, then we
may need to look if this is really a good idea or not.
COUNCIL MEETING 70 SEPTEMBER 11, 2013
Mr. Dill: I agree. We had a similar discussion with
KPD because it is a new thing. We will be keeping a close eye on how this actually
functions.
Mr. Kagawa: I will be hesitantly approving this
Resolution. I am kind of sensing that it will back up traffic, but I will hope for the
best in this situation. Let us just keep a close eye. Thank you to you and Doug.
Chair Furfaro: Thank you. Councilwoman Yukimura, you
have the floor.
Ms. Yukimura: Did you do an analysis of how full the
parking around the Central Pacific Bank building is? I know it is private.
Mr. Dill: No, we have not.
Ms. Yukimura: Even if you pay rental space or if there is
some kind of trade-off, that parking, if it is not fully utilized would be much safer
parking, and equally convenient; which is why the Victoria Transportation Institute
out of out of Vancouver— if you do those kinds of parking studies about... I do not
know even know what they are called, but you examine the collective available
parking on private property, and then you see how you can negotiate and make that
public parking. That may offer some options that are much better.
Mr. Dill: Okay. Thank you.
Ms. Yukimura: That is one (1) thought because I am very
concerned. I have talked to Doug about this; when a roundabout comes here—what
is this? Umi and Hardy?
Mr. Dill: Yes.
Ms. Yukimura: The school traffic backs up, Umi Street is
crowded, and people are coming in and out of the cafeteria parking lot from Wilcox
Elementary School. I think it just might be overload and causing malfunction.
Things will not flow smoothly because I can see the traffic from the school backing
up into the roundabout, and then I have seen the traffic queue on Umi Street at
that intersection. There is that release point where we can come across here
through what is not even a street, but actually a parking lot, and that allows people
to detour and go out. I guess it is called "connectivity" or something. I feel like it
needs some analysis, especially with the school traffic. You might want to look at
all of that.
Chair Furfaro: Those are all good suggestions. I just call
that street over there "the shortcut to the parking lot." That is what it has turned
out to be for all of us. If you come from the North shore and West side, come down,
and turn here, you do not go all the way down to the end of the school to get into
this parking lot. It is something that I think JoAnn has really pointed out to us
that could end up becoming kind of a thoroughfare if we are not careful with it.
DOUGLAS HAIGH, Chief of Buildings: In our master plan, that is it
considered one (1) of the main entrances into the Lihu`e Civic Center. It is coming
off of Umi right over there, so that is part of the master plan for that to be a main
entrance.
COUNCIL MEETING 71 SEPTEMBER 11, 2013
Chair Furfaro: That was the plan or is one (1) of the options
of the plan? Make yourself very clear because I remember it as an option.
Mr. Haigh: Actually, I did not see that as an option. I
saw it as an item of the plan. That was always to be one (1) of the main entrances.
Chair Furfaro: You have corrected me. I thought it was an
option. JoAnn, you have the floor.
Ms. Yukimura: That is it assuming that this street, Eiwa,
would be closed.
Mr. Haigh: That is correct.
Ms. Yukimura: Right now, it is not just an entry way to
parking. It is an alternative way to get through the streets.
Mr. Haigh: Correct.
Ms. Yukimura: If you are going to close Eiwa, you really
have a presumption that the roundabout is going to keep traffic smoothly moving
because you will not have this option of using this as a through street to get out of
the mess.
Mr. Haigh: Well, you would, because you would have a
continuation of the parking lot, and then your main entrance on Hardy Street will
be opposite of the Akahi Street. On Hardy Street, you are going to have two (2)
entrances. You are going to have an existing entrance close to Kuhio Highway, and
not too far away from that entrance, you will have the Akahi Street intersection
entrance. Somebody could definitely turn in here and make their way through to
Akahi Street. We have been observing what has been going on.
Ms. Yukimura: Good.
Mr. Haigh: We are also reconsidering the master plan in
that potentially Eiwa Street/Rice Street intersection. We are look at possibly
keeping that as right turn entry and right turn exit because what we are seeing is
that there is a lot of traffic coming from State employees and school traffic that
wanders through the parking lot, and ends up coming out at the Rice Street exit.
Providing an additional Rice Street exit might be very beneficial. We are actually
looking at—the consultant is putting together a proposal to do an analysis and our
Transportation Planner has been looking at this very closely with his gurus who are
in town and getting free advice from them on how to manage this.
Chair Furfaro: Did I hear "free advice" from the gurus?
Mr. Haigh: Well, they are being paid for a separate
project, but from this project we are getting free advice. We have been getting a lot
of free advice on this Lihu`e stuff because whenever they are here, we meet them in
Lihu`e.
Chair Furfaro: JoAnn, on that note, we need to take a tape
change. I am going to give Mr. Bynum the floor, but if you are not finished when we
COUNCIL MEETING 72 SEPTEMBER 11, 2013
come back from the tape change, you can continue. We are going to make it a ten
(10) minute break so that we can finish our business when we come back.
There being no objections, the meeting recessed at 2:30 p.m.
The meeting reconvened at 2:42 p.m., and proceeded as follows:
Chair Furfaro: We are back from our tape change. JoAnn,
you have the floor.
Ms. Yukimura: Thank you. I just have some commentary in
terms of lessening the parking problem in Lihu`e. As you know, we look at
multimodal solutions. If there are more workers, public and private, who are riding
the busses or bikes, that will help the parking problem in Lihu`e, right? Is there
any work being done on that, too?
Mr. Dill: It is part of this proposal. We are proposing
additional sidewalks and bike lanes. Soon, you will be seeing the Hardy Street
project coming up like more bike lanes and sidewalks, so we are doing what we can
to implement more improvements to promote that sort of thing.
Mr. Haigh: It also includes an enhanced bus stop.
Ms. Yukimura: That is right. Thank you for reminding me
of that. Thank you.
Chair Furfaro: I am sorry, I had my back turned and I was
looking at the map. What were your comments, Doug?
Mr. Haigh: Part of the Hardy Street project is that we
are enhancing the existing bus stop. With the Lihu`e Civic Center site improvement
project under construction now, within the month, we will be shifting over to the
Hardy Street side so we will be providing a safe Americans With Disabilities Act
(ADA) walkway connection from the bus stop directly to the Civic Center. Part of
the Hardy Street project, we will be upgrading that bus stop.
Chair Furfaro: The sidewalk and the new curbing that is
going in now is part of that upgrade?
Mr. Haigh; Yes, that is part of the Lihu`e Civic Center
sites improvement project and that is providing the ADA connection from Rice
Street to the Historic County Building.
Chair Furfaro: Very good. Mr. Bynum, you have the floor,
and then we will go to Mr. Kagawa.
Mr. Bynum: Thank you very much for this presentation
today, especially the part where you are saying, "Hey, we are watching what is
happening, meeting with people, and being open to make changes." I have been
waiting for this backup parking to get demonstrated somewhere on Kaua`i. I hope
it is eventually on the highway right out there where I head in now. I just wanted
to share that about five (5) years ago, I visited four (4) or five (5) towns that have
adopted back-in parking, and talked to the County Engineers there. They basically
said that it was much safer and there was a learning curve time where people had
COUNCIL MEETING 73 SEPTEMBER 11, 2013
to get used to it because it was new, but when they do, they love it. After they put it
in, they were getting requests to do it in other places. The logic is whenever you
parallel back in front ways or back ways, you disrupt traffic. Right now, if you
think about out here, I try to avoid those parking places because when you pull in it
is easy, but when you pull out, you are blind. People are pulling out every day,
blocking the traffic, and kind of just nosing out. When you do the back-in, you
disrupt traffic but you see it, and when you pull out, you have perfect view. They
also talked about pedestrian safety increasing after they did this. At first, people
would complain, they do not understand it, and it was awkward. The same thing
happens with roundabouts. The community norms take a while. In Kapa`a, I use
that so often. The norms are all there. I remember those first couple of months of
hesitation. Anyway, thank you for your efforts and your willingness to be flexible.
Chair Furfaro: Doug, I am going to give Mr. Kagawa the
floor. Larry, I want you to know that in about seven (7) minutes, I am going to have
to step out for a previous appointment with Mr. Trask and others. When I leave,
Vice Chair Nakamura will take over the meeting for me. Mr. Kagawa, you have the
floor.
Mr. Kagawa: Thank you, Chair. As I had some time after
I went first—maybe that is why I should not go first all the time, but I missed my
biggest concern, and that is right here. As you are coming from Wilcox Elementary
School, driving on Umi right here, it is going to become only one (1) lane. Right
now, as you are coming here, if you want to make a right turn on Rice Street, you
will go in this lane here. It just flows like this because you make your stop, and if
your right lane is open, you can make your right turn, even on a red light so it flows.
Now when it becomes one (1) lane, if this car is attempting a left turn, and you have
traffic coming across, what will happen is the traffic will back up because even
regardless whether you are turning left or right, you will only be able to stay here. I
can foresee some major, major traffic backups here. I really like that bike lane. It
is a good thing. I am not against having a bike lane, but not at the expense of
having traffic that is unmanageable.
Now the other concern is here. As you make your left turn on Rice Street,
normally when you see your gap, you will accelerate and go into that turn, but right
away, you have to watch for cars that are stopped here trying to reverse back. That
concerns me. What are the hours of these back-in parkings? Are there going to be
specific hours?
Mr. Haigh: Before we jump to that, I just want to clarify
that we are not looking at the Rice Street/Umi Street intersection in this map. You
go to the other map which is the one where we have the Rice Street/Umi Street
intersection. This is right where we have the State building on the right-hand side,
and then we have our parking lot entrance into the parking lot. That is the
entrance into the parking lot by the State building, coming off of Umi Street. That
is stopping for the crosswalk that we are just putting in now with our Lihu`e Civic
Center site improvements. Your Annex is right on the other side of that "b-line"
there.
Mr. Kagawa: The Annex is right here?
Mr. Haigh: Yes.
COUNCIL MEETING 74 SEPTEMBER 11, 2013
Mr. Kagawa: As you proceed on Umi Street and if you
want to make a right turn, you will be able to get in?
Mr. Haigh: If you look at the other slide, we actually still
have a right turn/left turn lane.
Mr. Kagawa: Scott, can you go to the other drawing?
Mr. Haigh: Yes, go to the other drawing. I apologize.
Ms. Nakamura: In the future, could you please label the
adjacent properties so at least we have some orientation. Thank you.
Ms. Nakamura: Yes.
Mr. Kagawa: Where is Rice Street then?
Mr. Haigh: Rice Street is on the top left.
Mr. Kagawa: Okay.
Mr. Haigh: That is the crosswalk going to Rice Street. I
apologize because this drawing did not print very well. Do you see that fifteen (15)
feet dimension— fifty (50) feet from the stop bar, you see a fifteen (15) foot
dimension? Yes, right there. Then do you see the ten (10) feet dimension closer
towards Rice Street? That is showing you that you have your two (2) lanes; fifteen
(15) feet is representing the right turn lane and the ten (10) feet dimension is
representing the left turn lane or straight ahead/left. That is the configuration. I
really apologize for this drawing because it is not giving the property lines very well
and not showing this.
Mr. Kagawa: Okay.
Mr. Haigh: That is part of the problem of scans.
Mr. Kagawa: If you are coming on Rice Street here and
make your left turn, so you have some space before...
Mr. Haigh: Correct.
Mr. Kagawa: How much...
Mr. Haigh: I think there is a driveway right there.
Mr. Kagawa: The CPB building is here?
Mr. Haigh: Yes, and I think there is a driveway right
there where you are now.
Mr. Kagawa: Okay, so it is a little ways up.
Mr. Haigh: Yes.
Mr. Kagawa: Okay, so it does not concern me as much.
COUNCIL MEETING 75 SEPTEMBER 11, 2013
Mr. Haigh: Yes.
Mr. Kagawa: There is at least maybe ten (10) cars that can
fit.
Mr. Haigh: We are showing eighty-eight (88) feet from
the intersection to where you get your first back-in parking.
Mr. Kagawa: How long is a car?
Mr. Haigh: About eighty-eight (88) feet.
Mr. Kagawa: Six (6) feet. Okay, so maybe ten (10) cars
can fit.
Mr. Haigh: Actually, a car is more like twelve (12) feet.
Chair Furfaro: Did you misunderstand that question?
Mr. Haigh: Excuse me.
Chair Furfaro: He asked how long the car was.
Mr. Haigh: Yes.
Chair Furfaro: You said eighty-eight (88) feet.
Mr. Haigh: No, I said that twelve (12) feet is the
standard car.
Mr. Kagawa: Doug, I have another question.
Mr. Haigh: Yes.
Mr. Kagawa: Councilmember Nakamura and I were kind
of discussing what is easier and what is better; straight in angle parking like this or
reverse angle parking. If you went this way and angled here, you basically have the
same effect. Is this like a national safety standard thing where I guess... what kind
of street do you call this?
Mr. Haigh: This is a Complete Street.
Mr. Kagawa: On a Complete Street, you want reverse in
parking instead?
Mr. Haigh: There is a movement towards reverse angle
because it is safer. There are various reasons. One (1) is when you stop in the
traffic, the car sees you behind you. There is no question that you are there because
you are there right in front of them with your stoplights telling them that you are
going to stop; whereas if you are coming out of a conventional angle in parking; as
you are coming out, the car that is coming there... you are not seeing him because
your view is blocked so you are slowly nudging out. That is an unsafe condition.
Two (2); when you reverse back in and you have kids in your car and open the door,
COUNCIL MEETING 76 SEPTEMBER 11, 2013
the door sends the kids to the sidewalk, where in the conventional back in parking;
when you open the door, the door is sending the kids into the road because the door
is blocking their access. It is inherently safer for kids because you direct them to
the sidewalk as soon as they exit the vehicle. Also, if you are loading the vehicle
with traditional back in parking, you are going out into the travel lane area to load
your car if you are loading in the back of the vehicle; whereas in back-in angle
parking you are loading into your trunk directly from the sidewalk. Those are three
(3) reasons why it is safe. Those are three (3) of the main reasons that I have heard
why reverse back-in is safer. I will be honest. I have never done it. This will be the
first on Kaua`i, but with our Eiwa Street current parking that we opened up with
the straight parking, I have been parking on Eiwa Street every day, and I back in.
When I come in, I stop, and the car behind sees me and they stop, and they have to
wait a second until I back in. That would be much easier if it was angled because I
would not have to swing. Since it is straight, I kind of have to swing out; whereas if
it was angled, I could just kind of scoot back in more easily. Yes, the cars will stop
for me if I stop in the roadway. I think it is going to work, but fortunately it is just
paint. We are going to put paint stripes on the road and if it does not work, it is not
that difficult to change it.
(Chair Furfaro is noted as excused at 2:56 p.m.)
Mr. Kagawa: That is what I said about this first plan. I
did not approve it the first time, but it worked because you guys were watching.
Councilmembers were watching also, so I will keep an out. How far does that bike
lane go on Umi Street, fronting this building right here? How far does it go? Does
the bike lane go all way down to Rice?
Mr. Haigh: One (1) of our challenges was the right turn
lane...
Mr. Kagawa: Yes, because I feel like it is going to interfere
with the...
Mr. Haigh: Unfortunately this scan does not show the
lines. I have the same scan with me. I really apologize, but I believe it comes closer
to Rice Street... do you remember, Larry?
Mr. Kagawa: Look, it ends here...
Mr. Haigh: That is what our scan did, but I think it goes
a little bit farther, or it may possibly end there, and then we just have a shared road
because we did have the problem of getting enough room. We were looking at,
"Okay, if we take the bike lane all the way to the intersection, that means we are
not going to have the left turn/right turn lanes. We decided it is not worth
sacrificing the right turn/left turn lane because it is a safety thing, and there is a
radius of turning. It is better to stop the bike lane sooner, so that once the bicyclist
comes up there, he or she has to be aware of the vehicles more, but we can still have
the straight left turn lane and the right turn lane.
Mr. Kagawa: Can I just end it? So for the bike lane, you
are not going to mark it as bike lane? You are not going to...
Mr. Haigh: Well, it is marked up to that point.
COUNCIL MEETING 77 SEPTEMBER 11, 2013
Mr. Kagawa: It is painted here and then it ends?
Mr. Haigh: What I am saying, is that I am apologizing
that our scan does not show exactly where it ends because we are not showing the
property lines up there. Larry and I both do not remember exactly what our
solution was, but it is very possible that we are ending it where it is shown.
Mr. Kagawa: If I was a bicyclist, I just get the impression,
especially if I am not really familiar with Kaua`i; I am going to be riding and it ends.
Where do I go? Do I go back? If it just ends here, where do I go?
Mr. Haigh: Then it becomes known that you become
aware of the cars because you are now going to be sharing a lane with the car,
which is our normal bicycle situation on Kaua`i. You share the lane with the car.
Mr. Kagawa: I get it. Thank you.
Mr. Rapozo: What is this here?
Mr. Haigh: That is a drain inlet.
Mr. Rapozo: A what?
Mr. Haigh: A drain inlet.
Mr. Rapozo: Okay, this is coming down to Umi to Rice,
this is the left turn lane, and this would be the right turn?
Mr. Haigh: Yes.
Mr. Rapozo: That is not going to be affected at all?
Mr. Haigh: Correct. We are maybe narrowing it a little
bit, but not significantly.
Mr. Rapozo: Thank you.
Ms. Yukimura: Are you thinking of these back-in lanes on
Hardy as well?
Mr. Haigh: That is the plan on Hardy. Basically, we are
having to eliminate some of the parallel—well, the total random parking in front of
the State building now off of Hardy Street... that we are going to have to eliminate
quite a bit of it in order to get bike lanes, our turn lanes, and our center aisle. We
did work with the State. We had to do some agreements. In between the State
building and the old judiciary building, we are going to have a reverse in parking
area there. I forget how many stalls there will be. I do not think it is any more
than ten (10).
Ms. Nakamura: Maybe we should limit the conversation
since the topic is Umi and Rice.
Mr. Haigh: Okay. I would be happy to review those
plans with anybody at any time.
COUNCIL MEETING 78 SEPTEMBER 11, 2013
Ms. Nakamura: Thank you. Are there any further questions?
If not, may I have a roll call vote?
There being no objections, the meeting was called back to order, and
proceeded as follows:
The motion to adopt Resolution No. 2013-69 was then put, and carried by the
following vote:
FOR ADOPTION: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Yukimura TOTAL — 6,
AGAINST ADOPTION: None TOTAL — 0,
EXCUSED & NOT VOTING: Furfaro TOTAL — 1,
RECUSED & NOT VOTING: None TOTAL — 0.
BILLS FOR FIRST READING:
Proposed Draft Bill (No. 2499) —A BILL FOR AN ORDINANCE AMENDING
CHAPTER 6, KAUAI COUNTY CODE 1987, AS AMENDED, BY ESTABLISHING
A NEW ARTICLE RELATING TO CHARGES AND FEES: Ms. Yukimura moved
for passage of Proposed Draft Bill No. 2499 on first reading, that it be ordered to
print, that a public hearing thereon be scheduled for October 9, 2013, and that it
thereafter be referred to the Committee of the Whole, seconded by Mr. Bynum.
Ms. Nakamura: Is there any discussion?
Mr. Rapozo: What is this in regards to just for the public's
benefit? All it says is "relating to charges and fees?"
Ms. Fountain-Tanigawa: It is establishing an annual fee schedule
where during the annual budget process, the Administration provides a
comprehensive list of County fees, and it is updated or at least reviewed annually.
Mr. Bynum: This is Chair Furfaro's proposal?
Ms. Fountain-Tanigawa: Yes, it is.
Mr. Bynum: Usually, we just pass these at first reading,
but my first read of it is that this is appropriate and necessary, and may avoid
future Councils getting into situations where fees are not looked at for twenty (20)
years. Thank you.
Ms. Nakamura: I think that is the beauty of this proposal is
that it shows when the fee was last amended. I think that is valuable information
for the Council to see.
Ms. Yukimura: I think it puts it all together in one (1) place
as well so people can see. They do not have to go referring to different parts of our
Code.
Ms. Nakamura: Yes. I think this was unfortunately not
included in your packet. Sorry about that. Is there any further discussion? If not,
may I have a roll call vote?
COUNCIL MEETING 79 SEPTEMBER 11, 2013
The motion for passage of Proposed Draft Bill No. 2499 was then put, and
carried by the following vote:
FOR PASSAGE: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Yukimura TOTAL — 6,
AGAINST PASSAGE: None TOTAL — 0,
EXCUSED & NOT VOTING: Furfaro TOTAL— 1,
RECUSED & NOT VOTING: None TOTAL— 0.
Proposed Draft Bill (No. 2500) — A BILL FOR AN ORDINANCE TO AMEND
ORDINANCE NO. B-2013-753, AS AMENDED, RELATING TO THE OPERATING
BUDGET OF THE COUNTY OF KAUAI, STATE OF HAWAII, FOR THE FISCAL
YEAR JULY 1, 2013 THROUGH JUNE 30, 2014, BY REVISING THE AMOUNTS
ESTIMATED IN THE GENERAL FUND (SHOPO Arbitration): Mr. Bynum moved
for passage of Proposed Draft Bill No. 2500 on first reading, that it be ordered to
print, that a public hearing thereon be scheduled for October 9, 2013, and that it
thereafter be referred to the Finance & Economic Development (Tourism / Visitor
Industry / Small Business Development / Sports & Recreation Development / Other
Economic Development Areas) Committee, seconded by Mr. Rapozo, and carried by
the following vote:
FOR PASSAGE: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Yukimura TOTAL — 6,
AGAINST PASSAGE: None TOTAL — 0,
EXCUSED & NOT VOTING: Furfaro TOTAL — 1,
RECUSED & NOT VOTING: None TOTAL — 0.
Proposed Draft Bill (No. 2501) —A BILL FOR AN ORDINANCE AMENDING
ORDINANCE NO. B-2013-753, AS AMENDED, RELATING TO THE OPERATING
BUDGET OF THE COUNTY OF KAUAI, STATE OF HAWAII, FOR THE FISCAL
YEAR JULY 1, 2013 THROUGH JUNE 30, 2014, BY REVISING THE BUDGET
PROVISO IN SECTION 2(E) RELATING TO THE COMMITTED RESERVE FUND
BALANCE: Mr. Bynum moved for passage of Proposed Draft Bill No. 2501 on first
reading, that it be ordered to print, that a public hearing thereon be scheduled for
October 9, 2013, and that it thereafter be referred to the Finance & Economic
Development (Tourism / Visitor Industry / Small Business Development / Sports &
Recreation Development / Other Economic Development Areas) Committee,
seconded by Mr. Rapozo, and carried by the following vote:
FOR PASSAGE: Bynum, Hooser, Kagawa, Nakamura,
Rapozo, Yukimura TOTAL — 6,
AGAINST PASSAGE: None TOTAL — 0,
EXCUSED & NOT VOTING: Furfaro TOTAL— 1,
RECUSED & NOT VOTING: None TOTAL — 0.
BILLS FOR SECOND READING:
Bill No. 2490, Draft 1 — A BILL FOR AN ORDINANCE AMENDING
SECTIONS 22-10.2, 22-10.4, 22-10.5, AND 22-10.6 OF THE KAUAI COUNTY
CODE 1987, AS AMENDED, RELATING TO DOG LICENSES AND
REGULATIONS: Mr. Bynum moved for adoption of Bill No. 2490, Draft 1, on
second and final reading, that it be transmitted to the Mayor for his approval,
seconded by Ms. Yukimura.
COUNCIL MEETING 80 SEPTEMBER 11, 2013
Ms. Nakamura: Is there any discussion?
Ms. Fountain-Tanigawa: Vice Chair, we have one (1) registered
speaker.
Ms. Nakamura: Okay. Please come up.
There being no objections, the rules were suspended.
ROBERT CREMER, JR.: For the record, my name is Robert Cremer,
Jr. Whether this thing gets killed or not, I am still going to be in your faces. I am
going to look into your eyes when you vote today and figure out where I am going to
go after this, as far as what I am going to do and how I am going to vote come
November. I am going to tell you guys again that this is unfair and unjust. It
should not be separated. Mr. Hooser, you was not in here when I made my
testimony and I do not know if you heard, but my words to you was that you said
your chickens lay eggs and provide food for you; my dogs provide food for me and
the whole community. My dogs should be exempt like your chickens are exempt.
This Bill should have never even been brought to the table. We should have
collectively all talk before you even brought it and figure out a remedy. Not just
because we need money right now, we are going to jam everything down the dog
owners' throats; fifteen dollars ($15) and seven dollars ($7) for me, and then fifteen
dollars ($15) for everybody else. Do you think it is fair for them too? No, it is not.
Everything should be equal here in this world. That is why we live in America. I
should not be paying fifteen dollars ($15) and seven dollars ($7) and the other pay
fifteen dollars ($15) and fifty dollars ($50) and fifteen dollars ($15). Do you think it
is fair for him? Do you think that it is fair that I pay for all of the cats and the
horses, one hundred sixty thousand dollars ($160,000), for the Wailua Falls cruelty
case? I am not saying the County taxes are not paying for part of it either, but the
part about it is that my dogs are going to pay for everybody else. Is that fair? Can
you guys honestly answer that? It is not fair. Until this thing ends, I am going to
be in your faces every time, even if I have to take off from work, I am going to come
here. It does not matter because I feel it is unjust and unfair, whether you guys like
it or not. Figure out where you guys going go because I am going to be here to
watch you guys vote. That is all I have to say.
Ms. Nakamura: Are there any questions? Thank you very
much. Would anyone else like to testify at this time? Seeing no one, we will resume
for discussion. Mr. Rapozo, you have the floor.
There being no objections, the meeting was called back to order, and
proceeded as follows:
Mr. Rapozo: Thank you, Vice Chair. I think one (1) of the
reasons we are here with this Bill was because during the budget process, there was
an appearance that, in fact, the County's funding was not fulfilling the contract that
they had been contracted to do. There was some discussion about looking for
alternative sources of revenue. Also in that discussion was the cats and other areas
of funding, and maybe allowing the Humane Society to charge for certain services.
That was the discussion that we had. The discussion was not to come back with a
Bill and lay it on the dog owner. That was not the discussion. The discussion was
to be creative and find other ways to generate revenue at the Humane Society.
Subsequently, we got a Bill that just goes after the dog owners and does not look at
COUNCIL MEETING 81 SEPTEMBER 11, 2013
the other possible avenues or revenue streams at the Humane Society. That is the
first point I wanted to make. I know that the Executive Director from the Humane
Society said the reason why it is here is because the Council had asked for it to be
here, and that is true to a certain extent. Also, there were other requests made for
alternate streams of revenue.
The other part of it since this Bill has hit the floor, and I agree with
Mr. Cremer, that it is very unfair to look at the shortfall and then try to pick it up
with just the dog owners. I think that the users of the facility should definitely pay
more and if you are a responsible dog owner who does not utilize the Humane
Society, then why should you be paying that much money? I think fifty dollars
($50) for a dog is very substantial and very, very expensive.
The other part though is really, and I think we talked about it in length
during the Budget and prior meetings, is how much does it really cost to administer
our County contract? Is our County contract going beyond the scope of what the
County should provide and should it all be encompassed in one (1) contract? I
disagree. I think the contract should be drafted in a way that meets the State's
requirement to take care of the dogs. Anything beyond that should be if the County
wants to participate. I agree. I think the County should be active in the feral cat
situation and other components, but that should be in a separate contract and
should go out to bid, in my opinion. There may be other organizations out there
that could offer the service for a cheaper price... I am not sure, but nonetheless, it
should be separate and apart because I want to make sure that we are getting the
best "bang for our buck" because it is taxpayer money that we are using to cover the
Humane Society. Now this process or this Bill has allowed me to look at other
jurisdictions and looking at the funding that other Counties pay. For example,
O`ahu's budget for the Humane Society is just about two million dollars
($2,000,000), but they have one million (1,000,000) people. We are told that to
administer our contract would be one point one million dollars ($1,100,000) and we
have sixty thousand (60,000) people or seventy thousand (70,000) people here.
I want to make sure that our dollars are being spent wisely, and again, I
mean no disrespect to the Humane Society, but like we do with any other County
agency or any other County department, I want to be satisfied that the dollars are
being spent properly. I will not be supporting this today because I am not
comfortable that we are getting that service. I am sure you folks get the same calls
that I do of the dissatisfaction with many of the calls that are going to the Humane
Society. Some call during the day and no one answers and if they leave a message,
they do not get a response. There are some issues that I have heard anyway, and
even from our own Staff here. If you folks need to talk to people, I can definitely
pass on the information, as well as myself, having called the Humane Society at
7:00 p.m. one evening for two (1) abandoned dogs. I was told, "Sorry we do not
respond unless the dogs are injured." That is not what our contract says. I am not
satisfied at all. I will be asking the Finance Department to do an analysis of the
contract spending and to make sure we are getting the right "bang for our buck."
One point one million dollars ($1,100,000) is substantial. It is very substantial. As
we look at all of the departments to cut expenses and requiring our own
departments to do more with less, I believe that should be extended to our
contracts, as well. I will not be supporting this today. Again, I will be requesting
that the Finance Department do not an audit, but at least do an analysis or try to
do an analysis of what the contract requirements are and what our contract actually
says, and if in fact, we are getting the proper service for what the contract entails.
Thank you.
COUNCIL MEETING 82 SEPTEMBER 11, 2013
Ms. Nakamura: Thank you, Councilmember Rapozo. Would
anyone else like to comment?
Mr. Bynum: I am going support this today. I want to talk
about my view of the history of the Humane Society. The Humane Society has been
around for a long time. We all remember the facility near Port Allen, `Ele`ele and
obviously, the Humane Society needed a new facility. A lot of the criticism that I
hear about the Humane Society has to do with that facility. It was overbuilt. It is a
palatial place. It is problem for the Humane Society because they have to maintain
it. I think those criticisms are somewhat legitimate, but those things happened
years ago. The current management of the Humane Society was not involved in
that. I watched the Humane Society take that palatial place and try to put it to
best use. We now have a shelter that you can take your dogs to when the hurricane
comes; one (1) of the few places in the Country. They are trying to maximize their
revenues by doing things like boarding animals and using that facility to the
greatest extent possible. They are doing increased services like Freddie's Dog Park.
They are an impressive group in the work that they do every year with endangered
seabirds and the myriad of animals that we have here. They have been coming here
and telling us for about four (4) or five (5) years that their fundraising is subsidizing
County contracted operations. In those years, they did not receive any increases.
We basically said, "Thank you very much." When this proposal came up, the new
Director came in— and I have been an Executive Director of a nonprofit, and if I
looked at their situation, I would have the same response that the current Director
has had. This cannot continue. We cannot do this out of our largess anymore. Here
is what we can do for the contracts funded and if we do not get more than this, this
is what you are going to lose. I am personally not willing to lose any of those things.
They are important and critical for the environment. We put additional funds in
the Budget. Some of us wanted to put more than others, but we compromised. The
Humane Society came and gave us... "Here is how much for what you are legally
required to do, County. Here is for cats and other animals." Well, I do not want us
to stop any level of services. The idea was that we have to increase fees. We have
that proposal from Mr. Furfaro to really track and monitor our fees in the future. It
is a great proposal, but fees have not changed for many years. We heard "seven
hundred percent (700%) increase." When you go from two dollars ($2) to fifteen
dollars ($15), that is a big increase but we have not had changes for years.
We were also putting in fifty dollars ($50) for an unaltered animal. That is
common all throughout the world about communities managing their animal
populations that are not being managed well, and ends up in dogs, cats, and others
being euthanized. I think these proposals are fair. This would have been impacted
hunters very dramatically because hunters, in their practices, keep unaltered
breeding stock; not all of theirs. In Kaua`i, provisions there has been provisions for
hunters, as far as I know, forever, because they are providing a very specific service
to our community dealing with the feral pig population and working very closely
with the Department of Land and Natural Resources (DLNR). I thought it was
important to recognize that, not because it is discriminatory, but because they are
in a specific class, just like I authored an Amendment that said "in-home daycare
providers are treated differently than dentists if they have their business in a
neighborhood because of the service they provide to the community." We put the
provisions back in that protect hunters and they are going to be paying a slight
increase from two dollars ($2) to fifteen dollars ($15) for the first, but they go to
seven dollars ($7) for each additional animals with no penalty for unaltered
COUNCIL MEETING 83 SEPTEMBER 11, 2013
animals. I think that is a reasonable thing and I will be supporting this today.
Thank you.
Ms. Nakamura: Are there any further comments?
Mr. Kagawa: Thank you, Chair. This past budget session,
we gave the Humane Society seven hundred sixty thousand dollars ($760,000)
which is a large increase from the prior year. I agree with Councilmember Bynum
that the management did not by the palace or the Hyatt of a facility. The
management just came in. She has been in there for five (5) months and I guess she
is overwhelmed with the task at-hand, and the money that she has left in the bank.
I think we need to control the feral cat and loose dog situation as needed on the
island. We cannot have the feral cat population going crazy. We cannot have loose
dogs going around and not being picked up. To me, this becomes an issue about
fairness. For only the dog owners having to pay for all of the services is unfair to
me. For people with multiple dogs, it is an unfair task. If they care for their dogs, it
is a huge expense already. I just have one (1) dog and it costs me quite a bit
because medical bills are the ones that really cost a lot. I always say that every day
when you go home, no matter how stressful the kind of job we have, my dog is
always the one that makes me feel better. He is always in a good mood. We all
have a lot of dog lovers on the island and a lot of cat lovers. I do not own a cat. I
believe we need to pay our fair share, but this issue is about fairness to only dog
owners and whether they need to pick up the tab for the feral cats, as well. We
have a huge feral cat problem that is impacting the Newell Shearwaters, which is
the reason why we have only one (1) more night game left his year in Kaua`i
Interscholastic Football (KIF). We have gotten crowds exceeding five thousand
(5,000); just amazing crowds. It will be the last five thousand (5,000) person crowd
we will have this Friday because after that, the crowds will go down to one
thousand (1,000) or two thousand (2,000). The main problem; the culprit; the
endangered shearwater people set up those infrared cameras and it was the feral
cats and rats that are eating the chicks and the eggs. The State DLNR does not do
anything. Again, the State; they do not do anything on this island to try and reduce
that population. Instead, they tell us, "You guys have to turn off your lights. Our
birds are endangered." If they would catch the cats and the rats, maybe we would
not have an endangered problem. The State, again, is dropping the ball on the
County to do all of the services. I am quite fed up with all of this. This year, it just
snowballed. I think the State needs to do more. They need to control that feral cat
population and save those shearwaters. That will lessen the burden on the
Humane Society of catching or dealing with feral cats. I will not be supporting this
Bill. It is not fair to dog owners. I am a dog owner of only one (1). I would be more
than willing to pay my fifty dollars ($50) for my dog, but I am not willing to pass
that burden on to other dog owners. I only speak for myself and when I look at it as
a whole, all of the dog owners are not fairly treated if they have to pick up the tab
for all animals on Kaua`i. Thank you.
Mr. Hooser: I will be supporting this Bill. I think it has
gone through the process. I know we could all look at the same issue and come to
different conclusions, but my conclusion is that this is a fair and necessary measure.
The Humane Society did come to us in the budget period. We did ask them to go
back and come back with revenue proposals. They did come back with revenue a
proposal. I met with the Executive Director of the Humane Society. We discussed
cats. For whatever it was worth, my suggestion was that they do not belong
together, initially, and that there are two (2) separate measures because the cat
portion will take a lot more work and a lot more thought, I believe, because it is a
COUNCIL MEETING 84 SEPTEMBER 11, 2013
different animal. I do not know if that is a pun or not a pun. It is different. It is
going to take some time to work out. It has got its own set of controversy, if you
would. I do not see any reason why we delay the dog element while we figure out
the cat element. I think it is clear that there is a good effort by the Humane
Society. I think Councilmember Yukimura has stepped forward and offered to take
the lead on that. I have a dog. I have a cat. I love my dog. I love my cat. I have
two (2) chickens and I love them too. My dog leaves far too much hair around the
house, I will tell you that. Yes, this is a fair and equitable proposal. I think we
should move it forward and not give it more drama than it needs. Thank you.
Ms. Yukimura: Thank you. Animal control is a necessary
Government function. If we did not control stray dogs and feral cats, or pick up
dead carcasses, there would be health hazards of all kinds, as well as
inconveniences. It is a function that Government has to be responsible for. We
have delegated that to the Humane Society. I believe they are doing a much more
cost effective job than we could. I am somewhat troubled by Councilmember
Rapozo's reports which I believe are true, at least I am sure that he has received
complaints. I think the new Director is someone who will face these complaints
head on and address them. I think we need to give her a chance. I do believe our
Finance Department needs to manage the contractor well and examine if the money
is used properly. I also believe that it is very possible, and probably likely, that at
least thus far, the Humane Society's fundraising has also been carrying some of the
Government function costs. We need to make sure that they have revenues to do
the job that we are asking them to do. During budget, they did come with a
proposal of fee increases. These fees have always been part of funding animal
control. They have not been raised, I think, for about twenty-five (25) years, so it is
time to raise them in an equitable manner. I agree with Mr. Cremer that dog
owners should not bear more than their share of the cost and that is why I am
committed to introducing a "Cat Licensing Ordinance." It will not take care of all
animals, but I am guessing that it will take care of the bulk of animals which I
believe to be cats and dogs. I did receive a draft proposal from the Humane Society
Director and expect to introduce something before the end of this year. We need to
do our responsibility, which is to keep fees current, and to supply revenues for our
contractor who is doing a Government function, and that is why I will be voting for
this Bill.
Ms. Nakamura: Penny has also sent me a copy of her
proposal to institute cat licensing fees. She followed up immediately after our last
conversation. I believe there is a commitment on the part of the Kaua`i Humane
Society to move in that direction. Let us do a roll call vote no one else is going to
say anything.
The motion for adoption of Bill No. 2490, Draft 1 on second and final reading
was then put, and carried by the following vote:
FOR ADOPTION: Bynum, Hooser, Nakamura, Yukimura TOTAL — 4,
AGAINST ADOPTION: Kagawa, Rapozo TOTAL — 2,
EXCUSED & NOT VOTING: Furfaro TOTAL — 1,
RECUSED & NOT VOTING: None TOTAL — 0.
Ms. Nakamura: Thank you. This meeting is now adjourned.
COUNCIL MEETING 85 SEPTEMBER 11, 2013
ADJOURNMENT:
There being no further business, the meeting was adjourned at 3:27 p.m.
Res. -ctf, y submitted,
•Li
JAW" . FOUNTAIN-TANIGAWA
Deputy County Clerk
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