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Finance Committee: County fund balance strong but monthly budget reports lag after new system rollout
Summary
County finance staff told the Finance Committee that the June 30 fund balance grew substantially but monthly budget status reports remain delayed after the July rollout of a new financial system; staff said they aim to reduce reporting lag to roughly three months and will provide a hazard-pay closeout and trend analyses.
HILO/KONA — Finance Department leaders told the Hawaii County Committee on Finance on Tuesday that the county’s fund balance rose materially but that monthly budget reporting remains delayed while staff finish implementing a new financial system.
Diane Nakagawa, finance director, said the county went live in July on a new system (referred to in the meeting as Connect) and that the implementation has produced “bumps in the road.” Controller John Arbols said reporting lag improved from “seven and eight months” in 2024 to “four and five months” in 2025 and that the department’s goal is to reduce delays so monthly reports are no more than three months late except for the fiscal-year closeout.
The committee also reviewed a fund-balance notification for the year ending June 30, 2025. Finance staff reported an ending fund balance in the range of the mid-270 millions, explained that designated amounts reduce usable balance, and said that after accounting for a roughly $59 million temporary hazard-pay appropriation the remaining balance was stated as $167,033,719.
“Starting in July, we’re using our new system,” Arbols said. “Our hope is that… timely would look like within the next one to two months delayed would look like three months.” Nakagawa added that the department is working with consultants on report generation and that once the month-end close and accuracy checks are complete it will solicit council input on more digestible report visuals.
Council members pressed for clearer, timelier information. One member said past monthly reports were often “irrelevant” by the time they arrived and asked whether the council could preview demonstration reports; staff said they would share preliminary views and accept council feedback after ensuring report accuracy.
Members also asked for a closeout summary of the temporary hazard-pay appropriation — which staff agreed to prepare — and for multi-year trend analyses on revenue and vacancy patterns to help with future budgeting decisions.
The committee took no final fiscal action at the meeting; the item was closed for committee purposes pending any future requests for follow-up materials.
