Planning staff explain fair-share funds, lapsed appropriations; council urges timelier reporting

Bethany Morrison of the Long Range Planning Division presented the fair-share contributions and expenditures report (as of June 30, 2025) and reviewed the rules governing those funds: fair-share revenues must fund capital improvements that add new capacity, not routine repair; projects must be located in the judicial district where funds were collected; and appropriations generally remain valid for three years before lapsing.

Morrison told council members that when appropriations lapse they generally return to the judicial-district pot for reallocation to other capital projects in that district; she noted exceptions exist when ordinances require refunds. Council members raised examples of lapsed appropriations appearing in the report—referencing projects such as a skate park, Banyans Beach Park and Pu'ulani Estates Park—and questioned whether departments are effectively using those balances. One council member noted approximately $5,600,000 had lapsed in North Kona parks, asking whether departments could be re-engaged to use those funds.

Why it matters: Fair-share funds are intended to mitigate impacts of development; if funds lapse or remain unused the county risks leaving money available for capital improvements untapped. Council members suggested improving the timing and usefulness of the annual report — potentially moving to semiannual reporting or adjusting code language — so departments and council can better match projects to these funds in the budget cycle.

Morrison said the annual report is prepared after fiscal-year reconciliation and that the planning division can work with finance and departments to flag available funds during the capital improvement budgeting process. The committee approved a motion to close the file on Communication 758 by voice vote (eight in favor, one excused).