federal funds we also performed the audit of the federal funds or what's called the single audit as a result of the audit we issued five separate reports the first report committee does not have all of the requirements to pass a budget reviews on this matter and i think you need that report before you since it is the auditors comments will take a short recess in trying to get the appropriate documents for the members will be in recess subject to the call of the  within this report on pages six and seven page seven this is a report on internal control over financial reporting out of compliance and other matters and this is required by government auditing standards within this report also with in this report another report on pages nine through eleven this is our independent auditors report complaints for each major federal program and internal control over compliance we also issue a report fair presentation of the schedule of exposures of federal wards or what's referred to as the on page ten is our opinion on the colonies federal major programs here we issue also issue an unmodified opinion and we state that the county comply in all material specs with the compliance requirements that could have a direct and material effect on the colonies major federal program we also report that there are two internal control findings that we also discuss shortly the federal programs that we audited this year appear on page twenty four of this report there are seven major programs and i think in the prior year there were five so we did a little bit more programs just based on the i wanted to go over one more thing before we get to the findings and this is a letter that required communication to those targeted governance and it's kind of like an audit letter or a summary letter and was over significant audit findings was government audit accounting standards board statement number sixty five we could describe it here that new pronouncement required a prior period adjustment to the financial statements to restate the presentation of several items within the financial statements also within the department of water they also implemented that gas be sixty five and so they also have a perp eared adjustment related to the implementation of that new accounting principles other accounting policies are consistent with the prior year and there were no transactions entered into the colony that lacked authoritative guidance accounting estimates the county's financial statements contain a number of accounting estimates the more significant ones are the estimate of doubtful columns which is the  collectability of the receivables this estimate is based on a common analysis a collection history depreciation of the colonies capital assets which is based on estimated useful life determined by management accrued other post employment benefits liability which is based on actual determination capacity estimates by management engineers and third party contract as part of the audit we look at these assumptions and factors used to develop these estimates and we believe that these estimates are reasonable difficulties in performing the audit we did not encounter any significant difficulties in dealing with management in performing and completing the audit as in the prior the connie was able to secure an extension by submit its financial statements by the end of january and they were able to meet this deadline i understand this was a transition year for a change in auditors and you know for the colonies so there was additional work on both ends by a colony by by us to gain understanding and you know i believe department of finance you know they spent a lot of time helping us gain that understanding  there was a material adjustment that was corrected by management to the prior finances demands which was related to revenues reported in the agency file that adjustment does not affect our opinions on the financial statements and we still are there are no disagreements that management in the financial colony reporting or auditing matters and management was able to manage that representation that are required for the audit again this letter is just a summary ok moving on to the single audit report and the findings within that report these findings start off on page twenty five of the single audit report yes correct you see there material or significant significance i mean if you could just give us a sense of how we should be looking at this two terms please ok sure the definition of very significant deficiency  the compliance that i'm sorry a significant deficiency is a deficiency or company combination of deficiencies in internal control that's it's not as severe as a material weakness but yet you know we feel  as noted within our finding and ordered by prior auditors there are missing approvals the manual time sheets or automated time cards noted during our testing now we were informed by the department of finance that there was a new policies and procedures manual effective june first twenty fourteen however our testing was not included did not include that keep period so we did know these findings so we did was we we did a little additional war on the june thirtieth pay period and we pulled a small sample and did not know any findings during that small sample  although that could be a good sign we were not able to say that it's resolved because we didn't the findings throughout the year the next finding on ph twenty seven twenty fourteen deaths zero zero two internal controls over payroll system historic at it again this is a repeat finding from the prior year historic edits are corrections to either the time submitted by the amount being processed in the payroll system the documented review and approval of these edits or the essence of this finding again new policies and procedures manual established roles and responsibilities of the departments and employees to follow regarding the psystar at its sole there was some corrective action as it relates to the issuance of new policies and procedures related to this finding reconciliation of federal and state grant program ok again this is a repeat finding and the county has made efforts to identify and work with the departments to investigate and reconcile some of the older ground balances since majority of the grants are on a reimbursement basis where the colony fronts monies and requests reimbursements from the federal government or the state government are shown as we see rules from the state and federal government but there is also amounts received an advance that are recognized as deferred revenues or monies that the colony still needs to spend what we're recommending here is that formal policies and procedures to tiny reconcile the grants either monthly or quarterly along with the overall monitoring of the federal state programs which is also another finding that will blow over so this grant position could monitor reconciliations and coordinate between the departments that are responsible for administering the grants and finance to ensure that the balances are accurate the next finding on page twenty nine twenty fourteen that's zero zero four internal controls over miscellaneous cash receipts again this is a repeat finding from the prior year  and although a large portion of the colonies cash receipts and revenues are real property taxes and other taxes there are small amounts that are collected at various departments and divisions within the co and the finding here is just that internal controls over these miscellaneous cash receipts should be improved affection and progress to capita assets were not occurring time and this is primarily due to the communication from the project engineers to the fiscal staff to property transfer these projects out of the c formal procedures to ensure that the completed projects are coming to communicated timely and transferred this year we were able to issue the department finance was able to issue the counties cough for about a month earlier than the prior year some of the issues that cause a delay was moving on to the next finding twenty fourteen zero seven on page thirty three review agency fund accounts this one finding was the one that we reported as a material weakness the county maintains agency funds that are custodial in nature and functioning similar to a clearing a column and should not measure results of operations of the colony we looked into several of the larger balances and noted that there were three with reporting issues the first was a real property tax litigated claims fund where there are approximately eight hundred fifty thousand dollars had accumulated and was transferred out during fiscal year two thousand and fourteen the second account was the planning application fees the department of finance had noted that they had discussed transactions in this column and had been in discussions to correct this balance in september twenty fourth teen there was approximately three point six million dollars transferred to the general fund representing fees from two thousand and two to two thousand and thirteen when the stand that the part of finance needs the support from the department agencies responsible for these different agency funds in order to do their part of the reconciliation as mentioned before we considered this as a material weakness because for many years that were sitting in the agency fun the three point six million would have misstated the current year financial statements if it was just moved and we ported as current year revenues actually the next four findings twenty fourteen to twenty fourteen zero one one these four findings are new findings and you know with the increasing reliance on information technology in colony systems the county has several significant accounting systems the first being the integrated financial and administrators solutions or ifas which is the colonies general ledger buildings is oracle utilities customer care and billing system or c c n d as part of the audit of the financial statements we gather information about the systems and the processes in place that account for  logical axis and access security the first finding is related to the general control of who has access to the different systems and how security systems are some of the items in the loaded or where there's confirm axxess rights to defer this review should include determining the proper levels of access is granted to the proper personnel terminations and transfers have been removed and if applicable any changes should be sent to finance for review and approval also recommend that there is a formal passport policies and procedures along with strengthening password controls which includes  all the validity of the backup data is tested a full recovery has not been perform was noted here is that changes to the i is system are requested by a real property tax division to outside vendor and the vendor will make changes directly into production or to program the recommendation here is that the change management policies and procedures are consistently followed all changes that are made to the financial obligations should be approved documented and tested before the changes are made to the system finding on page thirty nine twenty fourteen best zero one one i t governance audit we noted that the colony does not have formally documented i t governing its policies and procedures i see governance is a set of policies and practices that helps ensure that i t is aligned with and supports i we're recommending that the colony hold formal steering committee meetings and complete and i t risk assessment with the increasing reliance on systems in the colony section of the colony we wanted to communicate some of these issues that we noted during the audit at the same time we would like to communicate that the county does have policies and procedures in place within the department and some of these findings noted in our report are a few areas that we feel that the county could use some improvement but also understand that some of the constraints and i will always be the  time it's interesting you know as we're listening to all these findings did we fight opinion so it tells me that while there are issues and things that we need to correct  didn't find the material enough to to render the pinion on qualified ok so you kind of feel that the corrective actions that have been taken  me is disturbing and i just i guess is probably more for management or department but and a lot of it the the initial ones it's because of the new accounting standards that they were  they have been resolved now the implementation of the new york on in principle the actual presentation of that within the tougher that's i think a separate issue from these significant deficiencies in internal control on the reporting side the actual colony numbers and how it's reported that's where our unmodified opinion their implementation i think that's more of a question for management i understand that you know some of these things have been going on for a couple years whether or not it's a quick fix that's again a question for management  the logical access and access security just some of it is where you know just reviewing who has access to ifas and determining that everyone that does have access is properly  based on their position ok again i guess that would be questions of the department through him and i guess this is all encased in the fact that you're departments are given us problems don't think we have a doubt that those hours worked it's just the process of actually somebody just signing off on the type that they reviewed it and you know i believe it's more just administrative that you know other people in the department have the signature on it whether or not that was over the oversight it's hard for us to just  d i think fair to say that we'll wait and see see what happens next next audits and save establish a new policy in it and hopefully that will take care of the problem one of the other concerns the head was on the item number four the internal controls over mission with miscellaneous cash receipts again the question in my mind is the degree of the amount that we're looking at that might be at risk because of the lack of internal controls and i understand that there's sometimes a balance you have to strike between having really tight think that that's a balancing act that the colony needs to take a look at now whether or not you are going to hire another position to be able to have that segregation in a department that might be collecting a few that's where you have to think of it but in your in your review or the amounts of cash that were being handled with any given time large enough to be concerned that we need to implement additional staffing for the controls because i do it and in my business we've had this exact same finding and and we've decided in certain cases it's something we're going to live with because the risk is not  high enough to spend the money to increase the control segregation normally and when somebody is that segregation is broken because there's no one there to separate that cash collection and actual posting so i think in some cases that's my brain works and also for the june thirtieth twenty fourth construction in progress ballots you know we we did look at it and i believe and based on our work that that construction of progress balance is accurate and that the kind of capital assets had been moved to their correct the columns and that's where i think we had reported that there was a slight delay in completing the kaffir due to the time the manual process it takes to go to the cop construction in progress projects to get them cleaned up then move into the capital  catch all those assets right then on the monthly review of progress payment you have to justify make your adjustments every time you cut one check so you know what swelling down is we want to know is this construction of progress when i believe you know trying to do the reconciliation audit once a year and it's probably where it's a problem i believe if your problems with that kind of things and really what got me was when you say we have systems that are no longer available fundamental factor and obviously that's one of the things that is in my mind fairly dangerous because if that said no to a lot of issues maybe this is the eye opener that we need to see mr chair and maybe the old saying money where our mouth is as far as party is concerned because we've seen the global change and the hacking that goes on in many major systems and i don't want the county of maui to get into this area along with the other issues of show that should still go down manufacturing no longer supports it what do you do next yeah i believe you know with the reliance on information technology you know for monitor transactions that are going you know through the colony it is something that we felt that we should bring to you know that definitely needs to be in place because the chair but again that's the department i don't want to spend all their time going over this but thank you because it made us at least for me it made me a lot more aware of what's going on and i think the public any other questions members on section two financial statements findings repeat findings and how long should the council be tolerant before those findings are addressed or by policy eliminated  i please ask you to move forward with section three significant finding as mr white mentioned some of those are just we're going to live with that kind of things are we going to get a list of those that we can determine  are it's just not worth adding extra body or whatever and that we are going to live with is that something that you're willing to work with on this in the in this committee well  we will definitely work e p collets and everything else it will be a committee decision so in that list that you requested can we have it kind of broken out as to like dollar amounts because he said if it's only a few thousand noted a few errors in the schedule the accuracy and completeness of the sci fi can also relate back to one of the previous findings where there is the need to monitor and tiny reconcile the federal state grants will also lead into the next finding twenty four thousand us zero one three the recommendation for a centralized position to monitor the federal programs federal programs complaints in the current year there was approximately sixty one point three million dollars of federal money spent by the colony these grant monies are managed by the different departments and agencies throughout the colony and without a centralized position monitoring and overseeing these grants the colonies risk of compliance with the federal requirements this centralized position would be charge of overseeing the colonies compliance and along with monitoring the reporting and reconciliation of those outstanding balances along with completing an accurate and receiving sixty one point three million dollars in federal funds and what we're saying is each of the different people mintz that manage their own grants there's no one central position in the colony that  monitors compliance monitors the reporting ensures that everyone is aware of what the federal requirements are also in reconciling and determining that you know everyone is properly reporting their grants within the colonies a calling system there's not one centralized position for th repeat it awards of grants he would have to be in compliance to begin with correct so it's so there's i think if you look at sure the colonists schedule of expenditures of federal wards is starts on p h twelve and goes to ph eighteen there's a number of different grants and you know different departments each managed these different grants now when we come back to the single audit it's based on a scale of scope and based on size and so you know the the major programs that we actually look at is only this year seven but the number of grass that you guys actually have here is a lot each of the different departments and i can kind of just speak on housing we've been just recently working with housing to do one of their required federal filings that is actually due tomorrow we just completed and their report there i guess the report accurate just that understanding of what that federal requirement was to do that reporting was a lot of communication with finance and finance did a lot of communication with with housing to understand what that compliance requirement was should be housing they've been administering you know these programs know years it's not a new program to housing but when we took a look at it this year you know we did have some concerns that you know took a lot of effort from finance to put together the schedule and reconcile the schedule so that we could do the work and i don't believe finances position that fourteen is in is a full time position to monitor all of these different grants and the different requirements and you know that the changing quire ments with the different federal program that i just having difficulty understanding how you need a centralized position to just do a check off because each department is responsible to report to the whatever federal department is awarding you know they usually have a desk officer that it work with and you know they should be doing a double check so am just trying to understand how as why a centralized position is just going to be another check off when each department should have that  would like to see if i didn't quite get a good answer to this question ok so finding twenty fourteen that's serious there are three tiny reconciliations of federal and state grant programs you know there there is a large listing of these different grants that have balances that are or are older that still need investigation and clearing now right now are they reported as either federal receivable or state receiv which in those cases the colony have fronted monies for and you guys are waiting for reimbursement from these fed or state agencies now if you're relying on the departments to have done this then you wouldn't have these older balances that have built up they're doing their job they should've known these requirements so these things wouldn't have built up there's also the other finding on the schedule a federal wards where you know there's missing or programs that were improperly reported on the schedule now in those cases they've had  grants for this department of transportation grant two zero five zero zero two zero zero nine they've had these grants for many of years but it was improperly forwarded and prior audits i think what mr so we're trying to say is that the grants are monitored and taken care of within the department but from what that is run by and is the responsibility of finance so in order to get these two things reconciled in other words what's been reported by the department to the federal agencies and to make it a tie in to the general there dr cohen and system there's a there's a missing piece and i think that's what they're saying this missing piece is someone in finance that understands the system very detailed lee and they can in communication with the department get everything reconciled so when the audit to comes then everything ties in in the last case the agree to prom procedures i think mr so bad to work with the department as well as finance personnel and he somewhat assist them in terms of these two things together so he could sign off on  my understanding of the opinion of the auditor that this is but i don't want to put words in his mouth it's not my audit ok thank you  thank you chair and in there i don't know if they have a answer to this but i'm just looking at other county agency if they have a certain centralized position to monitor their grants it says we denied it but i but i remember this being a repeat issue to just year and the multimillions of dollars that we stand to lose if we are not in compliance as we move forward and so then each department as they're doing their grants manager can pick up from there and just sort of stay on top of it you know as the year progresses if something like that could occur  that a problem for us because we have all different type of grant writers writing different narratives of what the crony shooter should be doing with the fridge so the grant writing site is not something a scope of the audit i mean we don't look at that side of it sorry i wouldn't be able to comment on that part of it but you know on the federal complaint say you know one person that has that type of knowledge of the different grants that are out there and also knowing you know any changes that are coming through the federal side there is that what is referred to as a super circular on the compliance federal grants compliance issues that are coming down the pipe  you know there have been a lot of changes and you know you guys have gone through it when the our own money came through and it was a lot of federal monies that is available i would have to get back to you on that but i mean if it's directly related to federal programs allocation other costs would be allowable of the overhead to the compliance reporting but that's why i'm to to the federal program that these are only federal on it's as it upgrades to the county being the green tea this is nothing to do with the artists of the county for small so you had mentioned that part of the problem was that these items were not being reviewed in a timely fashion how how old would you say some of these are i mean is it are they two three four years old or and in what department are we for this behind ware of any software that would make compliance with federal contracting or grant monies easier on us sorry i mean i'm not aware of anything that would make it easier i think you know when i fist tax you know each grant and they're all set up within i face on a grant by grant basis and you know with it's a large volume of  the big problem then it may be appropriate for us to move all the ground grant managers and into finance but at the same time if you look at it from the other standpoint the criteria are different for every department the kind of grants a they're running are all very different from how it will seem to fire to police and so on so i'm not sure what the what the solution is  but you've also mentioned that if we have like costs reimbursement so there's that is that included in the sixty one point three so county up fronts so so much money in a timely and not too early and therefore a lot of times the county will expend the money and then we quest reimbursement whether whether it be from the state or from the feds a lot of the grants that you guys do have is passed through the state of hawaii so you know where it's presented a lot of it is the received was from the state of oil so i guess my question is that part of the over six sixty one point three million correct so sixty one point three is presented on a cold basis hollar kaffir is presented enough or too old or too cumbersome so i just talked to somebody during the break who said that they had their section of grants that they had to deal with and they balance to the penny but by the time you tried to get it to ifas and work with accounting you would never ever balance so i'm just wondering if that's the situation i mean i face is a pretty old piece of software in my understanding so i know you don't want to throw anybody under the bus or throw any software under the bus but is that i mean are we are we trying to create a position to to fix the different design or old fashioned design of ultimately on the reporting side for the federal grants you know your general ledger should be the basis of how you complete the parts now i'm not sure exactly  what basis they're using to create their federal reports that they're turning in but ultimately down our ledger is colonies official records so whether or not it's it that's fine and mr maybe that might be something that the department can answer at some time saying yeah it's just due to the system that we have that we you know our lives that's our limitation is the tool that we have is a little bit older than that it could be and then so do we either hire somebody to interface with that or get a new or system which is another whole can of worms those are some of the things that if we had the information we could make that you may not be aware of this but i was brought up to us one of our departments told us they would do capital improvement projects using operational funds for i guess for reporting purposes and i guess the process that finance uses to capture capital assets i think that you know could create a problem on there and now each each project is tied to be pulled to their schedule so if it's running through operations i believe you know it could be missed and that i do not think that that's the correct procedures that they should be using restatements of net position and fun balance so in this one you highlight two issues for three point six million dollars with the plan in departments account and then we also have one increase eight hundred more or those fees are never utilize for the intent of ordinance is structured and it was collected and so while we keep the midland if they should have used it for a specific on the top of that page you see the liabilities and there's deposits of beginning in june thirtieth twenty thirteen of thirty roughly thirty point one million and those amounts are just sitting you know we're sitting and being the collection of the money for stranded use was ever you know you are not sure from the documents you reviewed that the purpose of his collection was ever used for the purpose it was well the monies that were being collected were those planning fees and you know they were being collected and now they're rated for specific use correct i think those fees  an established the within the budget or are you confident we provided the service for the so ok so when we looked at those planning these that were being collected this amount has accumulated over i guess from two thousand two to two thousand and thirteen now those fees that were being collected now principal sixty five the beginning balances and the projections were totally incorrect also the implementation of the accounting principle gaspy sixty five pretty much what it was doing is  you know over the past couple years when each time the colony floated bonds and that asset was being amortized over the life of the bond so you know it's it's more of an accounting required it to be retroactively apply to the prior years so that right off of one point three million represented the opening balance that gives you sixty five that said to amount this particular fund is separate from other planning fees for their two accounts or three accounts how many accounts were there in planning there was just that one that was collecting those funds for specific positions by room i'm remembering correctly so is this a separate fun than the one that been utilized to fund positions i looked into it because i thought it was significant concern from my understanding from my discussions with the auditor and the letter that was provided to me i believe the amount that you're talking about is four nonrefundable application fees for syrian application fees so to the best of my understanding of it these are fees are paid time they're going to be earned i think the mix up was that the movement of those fees as they were earned to the general fund was never done so this is not a and expended from the special fund directly to provide the service these are fees step application fee is that once that position is finalized and then at that point these fees should go to the general fund as with any other fee that you have it's not up from my understanding it's not a fee that goes to a special fund in that sense ok but the other question is if somebody if pays a filing fee and then doesn't proceed with the project are they are they in that case refundable i would pretty much defer to the department but from  thinking is that if someone put in a deposit they decided not to move forward with their application and there were refunds once again i didn't audit this i just looked at it because i was concerned i wanted to get a better understanding it was reported to me because of the size  some of the parties were reimbursed their fees that's what it appeared by couldn't really tell because i don't know you know i didn't go as far as to look for if they had application i just saw names that these many's the agency funds i guess topic the parks and recreation trust three hundred eighty three thousand dollars so this parks and rec trust is also a deposit being held in a particular account for people who park assessment fees or and i guess at this point this balance we're unable to stating here how this just sits there and i mean this is i don't know can you shed more light about what this means i believe what goes into that deposit  is deposits for reservations for you know using some of part facilities but not actual listing of all of those different deposits and you know when those reservations are forest what was not being different departments that are doing the collections that you know ultimately are responsible for what they're putting in  in that department that they don't have it at this time but they can provide you with that information or they have no sense of information  cannot provide anything to you well during the audit we you know we put our audit requests for you know the schedules and you know the different ones that we're looking at and you know we weren't able i mean we had contacted we sent through finance through requests to you know get those reconciliations and you know they weren't provided and at that point we just said you know it's at this point it just needs to be a finding well as auditors there has been you know there's always issues with you know responsiveness expressed to you when you know you're you're looking at a lot of departments that are outside of finance and  many different years and many different clients that i've worked on yes for reconciliation and sometimes you just get this general ledger this thing of for the whole year for a balance sheet a call now the ability to produce what we're looking for i guess it's not that uncommon where you know there's been times that their clients have not been able to provide it ok thank you other questions for the information on thanksgiving day that i know some of them were putting in working on trying to get this kaffir out so i really appreciate the effort and you know time that they put into helping us and helping our you know get way that you had conducted yourself but also the way you put together the report so thank you very much thank you to anyone else as any comments or questions i would just say that i appreciate having the new auditors any and again i appreciate the tone and format that you've submitted your friend to us and you're making yourself available to respond to questions for the committee so thank you very much gentlemen for your good work members with no other business at this time we will be in recess until one thirty p m to complete the rest of the committee's agenda we are in recess finance but i'm happy to be here to give your presentation as well as us and if there's any questions along the way as we're going through the presentation you know please feel free to ask i want to make sure that we get to answer all your questions and if there's anything on the slice that you need clarification to please feel free to ask for clarification as well so the first presentation involves the employee union health benefits fund and these are the two cover copies of the reports the valuation itself is done every other year unlike the employee's retirement system that has an annual valuation every year now this is probably something that you would all be interested in and looking at the entire health benefits liabilities as well as the assets so i know it doesn't show this on this table but represents the twenty eleven numbers so the valuation reflects the second column two thousand and thirteen and the third column would be twenty eleven if you notice on the discount rate it's at seven percent so the discount rate is really what you probably know from the retirement system as the investment return rate assumption what is supposed to be or what is interesting to be earned every year by the particular file and so in this particular case that has a discount rate or an investment return rate of seven percent the rate earlier was lower in previous years and the reason for the lower rate was the fact that the fund wasn't prefunding in other words there wasn't a mandate to prefund the obligations of the t f and so with that act two sixty eight that was an active last year that gave the e t f the ability to change its investment return rate to seven now what you have also in terms of the numbers that are being reported if you look at the i think the number that you probably would be interested in is the unfunded actuarial accrued liability which as of two thousand and thirteen stood at eleven point two billion and so that didn't change a whole lot from the previous reporting period which was twenty eleven so if you notice it was eleven point one eight four in two thousand and eleven and it's eleven point one eight one in two thousand and thirteen what did change  slightly is the funded ratio so the funded ratio represents what you really have in the way of assets to pay off the anticipated liabilities and so it's essentially what's needed in the pot to pay off those liabilities so when you look at twenty thirteen it's two point six percent and the counties or some of the employers have been prefunding even though the mandated requirement came into play last fiscal year so if you look at the market value of assets for two thousand and thirteen and it it's the fifth line down and thirteen there was almost three hundred million dollars of assets to pay off the liabilities just to update you as of a month or two ago what's currently in the trust fund is about seven hundred fifty million dollars so between twenty thirteen that's reported here the two ninety six two hundred ninety six million and were in the trust fund as of a month or two ago it increased to about another forty five  may and that's due to a lot of the contributions from the county employers as well as a state of hawaii when you look at what's requirement so going back down what's currently being paid or will be paid by the end of the year hopefully is the peers you go benefits the four hundred twelve million that's being reported plus the minimum trust contributions the hundred seven million or so so rather than painless required in terms of the ark because act two sixty a phased in their required contributions for all other post employment benefits if you notice you see that twenty percent faison twenty percent of the t twenty million or so of the nine hundred fifty two will be paid in that fiscal year when you look at what's anticipated to be paid for june thirtieth two thousand and sixteen and this is the entire this is the entire trust fund this is not only my always portion but every statewide everyone's portion what's required or what was calculated to be required in terms of the ark is nine hundred eighty five million for twenty sixteen the pay is you go for fifty four million plus the minimum requirement of two hundred twelve million is likely to be what's to be paid for twenty sixteen of what's required and if you look at the act two sixty eight phase in that's forty percent of what's required so that's the phase in until fiscal year twenty one thousand one hundred percent of the open should be paid into the fun so it phases in from twenty percent in twenty fifteen to forty percent in two thousand and sixteen sixty percent and twenty seventeen eighty percent in twenty eighteen and finally a hundred percent in twenty one thousand so that's the phase in period so let's review some of the assumptions again mentioning as far as e t f is concerned the valuation is required to be done every other year not every year and the last valu was done in two thousand and thirteen now in terms of the projection assumptions again the discount rate is seven percent there they also have assumptions with respect to life expectancy and the li expectancy is about eighty two to eighty three years of age the payroll growth is the assumption this being uses about three and a half percent and pyrrha growth really represents not only new positions not only increase in salaries due to collective bargaining increases but it also could be because of promotions and other  the cost due to inflation and growth of the monthly base contribution amounts and they actually were evaluation and the contributions are based on a thirty i know it may be difficult to see but i want to pay particular attention to six column over because that's the portion so this is the represents portion as of two thousand and thirteen is about three hundred fifty nine million dollars when you look across the board too in terms of the arc and that's the see the board of water supply in honolulu it twenty six percent and then you do see a little heart which is currently doing the overall project of seven point six percent down in terms of the projections for the fiscal year two thousand and fifteen and twenty sixteen and you look at what the requirements are when you look at the requirements for the  portion for two thousand and fifteen for the county of it's about three million dollars and also for twenty sixteen it's about six million dollars what it happen to was by  paying in i think ninety seven point two million before the end of the fiscal year two thousand and fourteen what that did was reduce the contribution amounts going forward in fact i think the estimate before that payment was made for twenty fifteen was in the four million dollars range so you really shaved off about a million dollars off of the twenty fifteen requirement by making that  so as you can see the when you look at the count in terms of what's in what's in the fun to pay off the benefits and obligations the funded ratio is seven percent so represents again probably either low to middle of all of the funded ratios for the employers now this may be really really difficult to see but i think what's important to note from this from this slide is the fact that this represents a thirty year projection thirty year projection based on the twenty thirteen valuation of what's expected to be paid what's expected to be incurred in the way of obligations and what's interesting to note as when you look twente and this is for every single employer consolidated into one was interesting to note is that if all of the assumptions hold true so the payroll growth the investment returns the mortality tables and so forth and the contributions are received as required that the fun if you notice at the very bottom in twenty forty six the e t f when you look at the funded ratio should almost be fully funded the thing to know about this schedule is look at the contribution requirements so look at the column the fifth from the right where it says actual contributions eventually in the next twenty years or so the total contributions that's going to be required from all employers gets up into the over two billion dollars range and what you'll find and what you'll see in the presentation is that eventually it gets close to that that amount as well so over the years over the next twenty years or so just for the health benefits and the pension benefits contributions that will be required from employers collectively close to four billion dollars if not over four million dollars that's quite a sum of money when you look at the state of hawaii you look at the general fund monies and in terms of what's included in the budget the general may come to about four billion dollars collectively for us to two programs not including education not including public safety not including human services or social services and health that represents a significant portion and will continue to represent a significant portion of everyone's budget here shows graphically what was shown in a previous schedule and so what it shows is that if everything goes true all the assumptions hold true that eventually when you look at that  solid line it goes from about twelve billion dollars on the left side to about almost zero in two thousand and forty five or twenty forty six so this graphically shows how the unfunded liability will be paid down to twenty forty six if all contributions were received and if all assumptions hold true so here are molly's information in terms of retirees and active and the under the in the medical plan and romans so as you can see in terms of actives it's been pretty stable at about two thousand across the board from two thousand and twelve to twenty fourteen in terms of retirees there's been a slight increase from two thousand and twelve to twenty fourteen from eleven forty four to twelve twenty five wanted to make good note of this just from retirees in general in december twenty fourth teen just from the state wide standpoint we probably had more retirees in the month of december in two thousand and fourteen then we've had for the probably the past decade measuring it against any december of the previous years we've had we had over eight hundred retirement statewide we ordinarily would have over maybe six hundred so for whatever reason this pass calendar year in the month of december there was an increase in retirement now here we talk about again the establishment of the trust fund so what's happening is that the a and investment consultant to help with the returns just for the council's information that is a same investment consultant their retirement system uses pension consulting alliance and so with their assistance investment guidelines and policies were established as well as the ability of the e t f to invest in the monies instead of putting it in the state treasury that was many years ago and earning just for your information the state of war yes treasury last year it earned point four percent not one percent but point four percent when you look at what the e u t f as a result of the change in policy as well as the assistance of the investment consultant when you look at what they earned through twenty fourteen you were able to earn in two thousand and fourteen fifteen point three percent and the average over the last three years was about ten point one percent so whatever monies are be f trust fund any monies that were earned over the last three i mean were put in over the last three years on average would have earned about ten point one percent now it's working its way through the legislative process and was hopeful for the e t f is to have the ability to invest in a similar way as the retirement system because what you'll find in the next presentation is that instead of the fifteen point three percent that was earning twenty four teen the retirement system and actually earn almost eighteen percent so what the hoping for is to have the same statutory statutory provisions as the ear s in terms of what investment vehicles they're able to invest in in the fourth bullet that you see here to show what allocation the investment is are targeted for and i also have again i have paul allen here in case there are any benefit related questions with respect to the pension so this is what i plan to cover in terms of us the  membership updated benefits the dollars contributed assets investment fund that status unfunded liability the projection of benefits and liabilities legislative proposals that are that standpoint is a multiple plan employer multiple employer plan which means that you have separate pool of investments and liabilities and  consolidated into one into one final one pool however just for your benefit we had asked the actuary to break it out in terms of a methodology that would be reasonable even though it didn't have to do that for the fun does it have to do that and so what you see today will be information that pertains to count  it's an estimate only so as far as the retirement system is concerned the total membership is one hundred eighteen thousand sixty seven thousand active forty three thousand pensioners and beneficiaries and eight thousand plus in active members so just for the council's benefit again in active members are those people have gotten the years of service to be needed to get a pension benefit down the road but they have left state or county government service so they are no longer working for the state or the counties the are actually either working for the federal government private sector or not working at all but some time down the road they will be able to get a pension benefit once they become eligible so they got two years of service there just waiting to get the age and that's what this number represents the e t f should have similar numbers as well i would say about between ninety to ninety five percent of the members that are in their retirement system would also be the same members in the t f there are certain benefits that are given health benefits that are given would not ordinarily be given by the pension si so that's where the main difference lies this shows how all of the members are retirees have been growing over time so when you look at it when you look as early as two thousand and one you know it's barely over ninety three thousand or so and when you look at two thousand and fourteen it's close to one hundred twenty thousand so it has grown significantly over the last thirteen years or so retirees and beneficiaries  growing from two thousand and two of about thirty thousand to about forty three thousand and twenty fourteen so it is almost doubled in that time period when you look at the retirements and this is fiscal year so it doesn't include the december fourteen that had over eight hundred members retiring statewide but if you look at this it's been pretty stable o ver the last four years but twenty fifteen if if their retirements increase like it did in december of two thousand and fourteen that should be over two thousand retirements for the and fifteen just to let you know and i might have mentioned this last year but out of the active sixty seven thousand total members over fifteen thousand of the sixty seven thousand are eligible to retire today so we are on with your system from that standpoint again out of the sixty seven thousand active members statewide over fifteen thousand of them can retire today but for whatever reason choose not to do so but if the trend continues like in december of two thousand and fourteen we may see an upward trend of retirements over the next year to three years has twenty four hundred or so of the sixty seven thousand active members and this is june twenty fourt when you look at retirees and beneficiaries has about twelve hundred of the forty three thousand retirees beneficiaries and that includes not only the regular or service retirements but it also includes the disability retirement too so when you look at it for sixty one retirees who retired on disability now what's interesting to note on a second bullet the retirement system paid one point one billion dollars last fiscal year in the with pension benefit payments and when you look at what it's estimated to increase to over three billion dollars in the next thirty years per year the average annual pension as of the last valuation need is about twenty five thousand dollars per year now this is could be somewhat misleading because you have a lot of retirees that are living old living longer at an older age so they may have retired a good thirty plus years ago and this so their pensions were very small so this average annual pension blends in all of the retirees those that are retired thirty to forty years ago and those that  recently retired last year what's interesting to note too and i think i might have mentioned this last year but i'll give you an update there are about the last time we checked forty seven pensioners that are one hundred years and older that are collecting benefits from the retirement system there are seven thousand eight hundred pensioners out of the forty three thousand that are nine and older that are collecting a pension and this is to reiterate again the fact is i think there's actually over fifteen thousand that can retire today not fourteen this is what's contributed to the retirement system by the respective employers what i want you to note on this for you at about twenty eight million dollars what i want you to know  is this is that this represents the total amount of contributions received by employers and employees for twenty fourteen so look at the total of the two on the on the last line eight hundred  fifty nine million dollars but we paid out one point one billion dollars in benefit payments last year so they took in eight hundred fifty nine but they paid out one point one which means that the difference the two hundred plus million dollars difference that came from the corpus or the fund itself investments had to be liquidated to pay out those benefits this is just a reminder for council members this is what is contributed by the employers every year so last year for twenty fourteen twenty three by law it's a percentage of everybody's pay so for police and fire twenty percent of their pig was paid or contributed by the employer for the police and fire and sixteen percent of pay for all of the other employees this again breaks if you look at the second bullet it breaks out the contribution and as a said earlier it's projected to increase to about two billion dollars and next thirty years  i just want to know that twenty fifteen the contribution rates will increase so the contribution rates increase slightly until twenty seventeen i mean excuse me twenty sixteen of which then it should be fixed unless it goes through a legislative process to change the rates so next year two thousand and fifteen the contribution rate will be twenty four percent of the police for police and fire and seventeen sixteen point five percent for all other employees the following year would be twenty five percent for police and fire and seventeen percent for all other employees of pay and that will remain until any statutory changes take place where there it be to lower it or increase it this shows what was earned on the investments so the market value in terms of the earnings was seventeen point eight percent as of twenty fourteen the market value was fourteen point two billion dollars this is an all time high for the retirement system in the way of the investment portfolio so what's interesting to note is that the market value exceeded the actuarial value which means that there is gains to be made to be gotten going forward the actuarial value represents only one quarter of the gain of that seventeen point eight percent that's why there's that could offset that loss so in other words the funding of the system could still remain about the sane because of the gains that are that are are being u year an update to the allocation of the investments for the year s now it's interesting to note though is that the board of trustees of the retirement system is not on this slide but i'll just make mention of it the board of trustees of the retirement system had approved and adopted a different investment approach and it's a risk based approach which would help stem off some of the downsides in investment markets so i'm not sure how many of you have been following the market of late but over the last  week in terms of before the last couple of days maybe three or four days before then the market has substantially taken a dollar turn and it's recovered a little over the last couple of days it still hasn't recovered what it lost over the last week or two before then but the retirement system is looking to ensure that it can meet any downturn in the marketplace this shows the unfunded actual accrued liability which is at about eight point six billion dollars what's interesting to note on this is the funding period twenty six years what that means is if everything holds true the investment return rates hold true the all the other assumptions hold true contributions are received that can be fully funded within twenty six years and what's interesting to note is when i came here last year to report on this the funding period to period on or pay off the unfunded liability was at twenty eight years it is again another year in terms of paying down the unfunded liability and what that means is that employers won't have to pay in another seven hundred plus million dollars to the fund by gaining that one year point four percent and they have been putting in my knees over the years to help fund that era's however it's still in the bottom floor tile among public pension plans this just shows graphically the ability if everything holds true of the era's to pay off unfunded liability over the next twenty six years so if you look at the dotted line versus the solid line that shows the gain between twenty thirteen and twenty fourteen a one year in pain dollar unfunded liability now when you look at the second bullet the unfunded liability be removed because of primarily because of the change that the board board did to reduce the investment return rate assumption from eight percent to seventy three quarters percent and just to let the council members know the board did adopt another change or decrease to the investment return rate assumption in the next and it's a phase in decrease over a three year period the investment return rate assumption will decrease from seven three quarters percent to seven and a half percent so the next valuation riparian will show instead of seventy three quarters percent it will show seven point six five percent the next valuation period after that will show seven instead of seven point six five percent it will show seven point five five percent and finally in the third year it will show seven and a half percent any change in the investment return rate assumption for valuation purposes will increase the unfunded liability any quarter change in fact of the investment return really increases the unfunded liability to almost about a half a billion dollars this shows graphically how the unfunded liability has increased over time between two thousand and three and two thousand and fourteen some of it due to the recessionary periods in fact actually most of it is probably due to the recessionary periods that occurred in two thousand and one and two thousand and two and two thousand and eight in two thousand and nine when you look at with gadsby sixty seven and sixty eight coming up in terms of reporting for the each employer this is an estimate of what the actua projected if they were to use the methodology of and i think they used to use the payroll distribution the county pension liability based on the twenty four thousand numbers is what's interesting interesting to note on this schedule this reflects the growth rate or the growth amounts in the contributions so the employer contributions the benefit payments and the liabilities when you look at benefit payments and the liabilities when you look at the growth of those two collectively which means that quite possibly down the road if investments and employee contributions don't hold true as well as the other assumption there may be more that may be needed because of the liability growth and the liability growth also reflects the fact that there were pension reforms that were done in twenty eleven through twenty fourteen even with that the liability growth rate will also include will also increase excuse me went down the road beyond two thousand and twenty three more likely in two thousand and forty's it should even decrease even more because those reforms would likely to be one hundred percent effective at that point in time now what's happening with legislative proposals currently in this session there are one bill if and i think this was also introduce last year if there were any employee that was convicted of a felony that related to their work as an employee with the county or any other state or county employer that the represents housekeeping bill to make it consistent with the hybrid plan requirements this third bill i think when you look at it is important especially on a service acquisition contributions side of it let me give you an example we found over the years found that it wasn't collecting enough for those employees who are acquiring service just as an example this is a real life example there was a member that paid in two thousand dollars to acquire two years of additional service that individual got five hundred dollars per month increase to their lifetime benefit two thousand dollars for a five hundred dollar increase in their pension benefit when the actuary had calculated or it should have been the actual cost it was in a neighborhood of eighty thousand or so versus the two thousand that was actually paid  and the reason for that is that the methodology that use that is by law by state law was enacted more than likely over half a century ago and so it's been it's extremely outdated and so in order to update that methodology to get better actual costs this proposal was introduced so can you imagine how much that's contributed to the unfunded liability for all of the service acquisitions that have been occurring throughout the years second bill employer reporting and penalty we don't get any payroll adjustments by all employers electronically this will require them to give us all of that adjustment so we can so that it's benefit calculations more efficiently and effectively this will require all employers to give us that information electronically on the second bullet board executive sessions this is just clarify the fact that they can be executive sessions especially for the investments where there are  investments being proposed if got into the hands or investment consultants or managers would give an unfair advantage to those others so this clarifies the ability of the heiress board to go into executive sessions primarily for these investment proposals and then the last bullet i not all amendments were able to get through with the pension reforms and this was one that needed to get through anyway that's the presentation for the earth's and i'd be happy to answer any questions that you have on both  think that's not on them is that skip that part and thank you for your presentation it's become very apparent how big the retirement system has grown along with the other part of our  funding mandates that we are here in the county of maui and the rest of the counties and states are in need of do you foresee and i guess just a general question do you foresee any and next year a year after we hope not too soon but it's it's a reality we live in which are kind of goes up and down and generally speaking hopefully not to the last you know it was very long inauguration is still in some when there was a significant downturn that lowers the asset base tremendously in order to recover you need to recover significant amounts going forward so in other words if you had a stable seven percent return every year over the next thirty years you would be better off having that go that way on average than if you had significant fluctuations in other words a significant downturn you may be better off by having that more stable environment than having that significant fluctuation especially if you especially and i make note of this is especially if you have significant downturns even  understand and i understand how that create it works as far as if they're in active working for the federal government maybe not even working what happens when they become eligible and then how does that how is that the term solution would be the same like all of us here you know the words the highest monthly pension you can get is based on your years of service plan that you're in so the planet you're in would determine the multiplier for most people it's a two percent or for the ones that started before two thousand and twelve so it's a multiplier times years of service times there are three highest salary is based on what over that ten year period that they were previously is the same so whatever they are and over the ten year period the three highest periods will be the calculation and whatever plan that they would have the same percentage so if effectively what you have is the same calculation is just that you can't get any benefit until you become age eligible and most importantly you apply for retirement because some people think because they have left service that automatically as an example for the hybrid members at sixty two they're going to collect a pension they have to actually put in an application for retirement in order to collect their pension so in answer to your question the liability will be on the books already unless they come back to employment which will change their benefit if they work more years benefit if they get a higher salary increase their benefit as well because of those three components two of those components will change the salary and the individuals that liabilities already been fixed you have that as far as what you know you have to be based on that at this point in time that is correct and the only thing that would change in terms of the liability is if somebody assumptions do misplacing no thank you miss mathilda thank you very much for the good information and it's just it's amazing the statistics you gave us about forty seven people in this group being over one hundred years old  and listening to mr victory is coming because you know they're telling us that some of us will outlive our children because of lifestyle and so it's kind of scariest when you think about it i think that's what's mr victorian or is alluding to so we may see a difference but it's been trending upward for so long but it's very good that you know we have this all worked out and thank you very much for all your hardware thank you mr cochran thank you chair and thank  thank you and congratulations wes for being here you know you talked about we paid we took in about eight hundred eight hundred million eight hundred  ninety million forgot exactly in a fifty nine million but paid out over a billion benefits so essentially the contributions still be there depending on what level you hire them as an example because for every additional person that you're hired as an additional liability to write a pension even though they may be contributing there's still an  those that are higher now will get i'm not sure if this is the right word or not generous a benefit as the previous members in fact current members were h before twenty the costs per year for those individuals from a pension liability standpoint is six percent of their pay with their reform with the two thousand and twelve and after hires it's reduced to two percent of pain so instead of six percent that you're putting in for the previous employer members you're putting in two percent of pay for current members of the new members so there is a significant pension or would be kept in to fund it so you could you could have situations in which and here's an example of this is probably a far fetched example but this could be a real life example we have an option that's called a join a survivor option option where if the retiree process the beneficiary gets one hundred percent of the retirees pension payment going forward for the rest of their life his or her lifetime if for some reason they go on and on a trip together after a couple of years of being retired if they go on a trip together and both of them unfortunately plane crashes and they pass away and  then that's all that would be collected from the beneficiary and the retiree so they collected sixty thousand but they put in one hundred thousand that forty thousand different styles and difference would stay in the fund normally and very rarely happens i haven't even heard of a situation in which it happens but it could happen flipside is that there are a lot of people that actually live there that they're supposed to live so they actually collect more than what they're supposed to you know the words instead of the hundred thousand that they put in two or three hundred thousand situations in which that could happen and it comes back to them and it comes back to the fine actually which means that there would be less contributions required by the employer calculated of what the market would change to with the receipt of the ninety seven point two million because last last year we were told that that was going to dramatically reduce the ark actually if you at five of the present that's the change when you look at the three main dollars under twenty fifteen five point nine million for twenty sixteen so when you look at the column and reflects ninety seven point two million at the end of the fiscal year previously when that wasn't paid in the actual amount that was required was four point two m one what is that twenty eight million to forty one based on how do you get to that calculation is that off of the three fifty nine fifty nine million yes the ark for the right yes that's correct so if that's correct and the twenty eight point two million is roughly seven point eight percent of three hundred fifty nine million but if i take the ninety seven million and add it to the twenty six and the three fifty nine is reduced to sixty two and the twenty eight million should be reduced to somewhere in the neighborhood of twenty million  nine it's not it's not reflected in the schedule but it's a reflection a future contributions but is it reflected in the future contributions of twenty eight point two four million or is it reflected in the  regular and your payment not taken advantage of to sixty eight what would twenty eight million to be adjusted to it would be adjusted to fifteen points remain primarily prior primarily investments they're they invested in passive mutual funds versus the us which is more assets are primarily invested  approach life the two differences and number two question is the structure of the truss as it deals with the trustees and making these investments what is the structure and what is the structure of that so it's two things so the first question in terms of what the difference between us so both are dictated by statutory requirements and so th its way through the legislature currently that if it goes through and we're not sure if it's going to go through but if it goes through to invest in the same way as the u s so it has to be done there has to be a wrist based portfolio in that you can invest in stocks real estate and pretty much anything that's out there in terms of what's  my second question is the structure of the the trustees and the head trust structured and so you have ten board members you have five from the employer and five from the employee couple of proposals there were either in terms of not being heard so i don't believe any of the bills are making its way through the process currently so when it when it comes to the  he trustees to get consent for certain investments or do they just independently make those investments well there's investment guidelines that are adopted by the bo years the investment they invest for the long haul even beyond a ten year period so just looking at the next ten years they considered seven point two percent to be reasonable so the seven percent  program for all employees and beneficiaries this is also based that we get reasonable collective bargaining is there going to be an effort from the myself in the two and half months that i've been there after having looked at that area but it's something i probably will take a look at more than likely and i'm sorry to say this but more consult with you on how potential contract talks the way it's leaning one way or the other what is the impact on your program regarding the retirement and health benefits or is that not even considered after we  get one arbitration award or something they have been the negotiators the chief negotiator for the state has been discussions with me in terms of what the financial impact would be so everything  being put on the table or thought of to be put on the table are running through the numbers with us to see how that affects the financial plan because we have to submit or ensure that there's a balanced budget so we're by constitution to do so now that's right i have some questions on the some of the calculations that you know mr white asked about that are in the next bill but i would like to ask him if he's going to be here for that for the calculations within ninety seven million and without it and that's actually in the bill on page three and two and three but when they're doing the calculations i don't see ninety seven million dollars being taken out of seventy nine million dollars mean taking out eighty five potentially but i don't know where the ninety seven million dollars we can address that when we get to that in communication addressing the ninety seven point two million dollars specifically and the impact of the preferred rate on the discount  for illinois obviously but i could get that information for you in terms of where we are actually aware that actually ranks and listing all of the funds they do have that information available i'd be happy to share that with you and different responsibilities than our county so i just was curious about that the other thing i wanted to check with you  individual or entitled to a pension so there's nothing currently in place in the law that would prohibit anyone from getting their pension  based on the ninety seven point two that we might sent to them they agreed they asked me to pay the two thousand five hundred five hundred because the sixty eight requirements has to your the the request that we have for the bill is that you live your life in the fourteen letter to me and i have discussed this with the budget director and the mayor that we should try to put the arc which is fifteen ok i know there's budgeted about thirteen million but as your chief financial officer mr chair going through the the trust fund because he wasn't qualified then but one rater loves the idea the concept that the policymakers here in the county of mali is willing to refund that particular unfunded liabilities after year that we have been committing resources to prefund this liability so the budget director and the mayor say ok let's ask the council so that's why we are here today chair that's the reason that we're asking for that but it's true that we have thirteen million there and only required is only twenty percent which is after the revision is three million three point zero six questions you might have thank you very much  aware that seven million dollars went and then after that even saying it's going to be ninety point nine million i don't see it in any of the tables on the next page on page two where talks about  you know i'm not a finance wizard that's what my wife does in our little ship there but somebody looking at this who isn't you  know all these financial things are there are going to say words are ninety seven million dollars what did we pay it for and where did it go i mean the most i can see is something about  eighty five million dollars that they're giving us credit for but i'm still short eleven million dollars like to know where that goes and that and that a an overall kind of puts a big question mark on this whole thing that we're talking about because it's it's this is what some group of people are saying that it might cost in the future  and it seems like it seems like i'm not saying it is but it seems like it's all smoke and mirrors i can't point to somebody and one of my constituents and say well here's our ninety seven million dollars of your taxpayer dollars that we can account for but maybe it's just because i don't know how to read the  fourteen it cost us two thousand five hundred to just do that so if i would have asked for a full up tauriel it might have been a little bit more so again i apologize for the approach because the in the attached actuarial but on the on the presentation that were given earlier not all of the numbers match so i'm a little uncomfortable with exactly where we where we stand right now and based on that to sixty eight you know we we don't have to make any additional  i certainly agree that this county has done a very good job of of achieving a very strong bond ratings and i'm sure will continue to do so whether we take action on this or not today we've got a budget coming up the worst starting tomorrow and we can certainly deal with it at that point so i'm i'm a little was explaining about the of the last paragraph here on the first page where it says because the payment was made eleven months after the valuation date the ninety seven point two million contribution made in july of two thousand and fourteen will be treated as receivable assets of ninety eight point nine million as of july first two thousand and thirteen and then i go off to the after reflecting the ninety seven point two million and it looks  our balance there was eighty five now so i i i am having difficulties following the explanation you know aside from the bragging rights and all that other stuff but i would like further explanation so that i may make an informed decision thank you love this type of funding and this type of allocation of county dollars what i had preferred was what i had anticipated i should see  and the so i read and smile on your interpretation of ordinance they're asking us to make a change whether or not we are going to actually use the fund because one of their put their to take it from i think that it's not my preference  it's clear what our policy is and he needs to be followed and i open not well so far it cannot help but in the future i will not take up corrective measures after the fact since the payment was made prior had june thirtieth two thousand and fourteen what should the amendment really be as of what as the fiscal year you have any thoughts on that and second if we make these changes is that appropriate or must we request payment to open had would be out of department of finance countywide costs and it's the leading the transfer of the thirteen million to the post employment obligations fund so i guess from your prior statement i believe the council's wish would be for it still to go into the money still to be transferred into the post employment obligations fund according to chapter three point one seven and i believe the department of finance would prefer to see an additional two point three million so that it would line up with the recommendations of contained in the report natural fifteen three zero five but again my understanding is also from the council that they'd like further information of how the fifteen point three zero five number was achieved and as far as the second bill that ninety seven million two hundred twenty two four hundred thirteen the first column of course is an estimated budget in march and you folks are working on the budget you know on doesn't take effect to july first so again that's just an estimate that dissipated revenues for f y two fifteen of course would need to reflect still need to reflect the thirteen million on the if it's the wish of the council the two million by thousand dollars or we use in the open space fund and the other funds i would just note the expenditure out of there and i believe that would satisfy most of the council's needs and desires and i believe the finance director is open to that also and thank you so so so is a committee able to make these revisions were requested to the budget director furred thank you very much members of the business before the budget committee this afternoon thank you for your presence this meeting is a