NEIL ABERCROMBIE GOVERNOR

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KALBERT K. YOUNG DIRECTOR

LUIS P. SALAVERIA DEPUTY DIRECTOR

EMPLOYEES RETIREMENT SYSTEM HAWAII EMPLOYER-UNION HEALTH BENEFITS TRUST FUND OFFICE OF THE PUBLIC DEFENDER PUBLIC UTILITIES COMMISSION

STATE OF HAWAII DEPARTMENT OF BUDGET AND FINANCE

P.O. BOX 150 HONOLULU, HAWAII 96810-0150

ADMINISTRATIVE AND RESEARCH OFFICE BUDGET, PROGRAM PLANNING AND

MANAGEMENT DIVISION FINANCIAL ADMINISTRATION DIVISION OFFICE OF ECONOMIC RECOVERY

AND REINVESTMENT (ARRA)

November 15, 2012

FINANCE MEMORANDUM

MEMO NO. 12-19

TO: All Department Heads

FROM: Kalbert K. Young Director of Finance

SUBJECT: Department of Budget and Finance's Recommendations on FB 2013-15 Executive Budget Requests

Your department's FB 2013-15 Executive budget requests have been jointly reviewed with the Governor's Policy Team with due regard to program requirements, the Administration's priorities, and the State's fiscal condition. In total, over $1.2 billion ($505.8 million in FY 14 and $715.6 million in FY 15) in general fund requests for the biennium were submitted and considered.

After much deliberation, over $1.0 billion ($433.2 million in FY 14 and $623.4 million in FY 15) in general fund requests have been recommended for the Governor's budget. However, departments should bear in mind that additional revenue enhancement measures must be proposed during the 2013 Legislative Session to support a portion of the proposed increase in general fund spending.

Attached are the Department of Budget and Finance's (B&F) recommendations on your department's requests. Please review these recommendations.

Should you wish to appeal any of the proposed actions, I will be available to discuss your concerns between 9:00 a.m. and 12:00 p.m. on Monday, November 19, 2012 through Wednesday, November 21, 2012. Please contact Ms. Shirley Kawamoto of my office at 586-1519 to schedule an appointment. For your information, there will also be an opportunity to discuss B&F's forthcoming final recommendations with the Governor during the week of November 26, 2012.

Departments with preliminary lump sum operating or CIP allocations should allocate those amounts to specific original requests (i.e., the lump sum allocations are not intended for new requests). Priority shall be given to shovel-ready CIP projects. As

No. 1 Capitol District Building, 250 S. Hotel Street, Honolulu, Hawaii 96813

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applicable, each department shall use the revised Form B (Department Summary of Operating Budget Adjustment Requests) or Form S (Department Summary of Proposed CIP Lapses and New CIP Requests), which reflect B&F's recommendations and will be e-mailed to the appropriate departments by their B&F analyst, to specify the requests to be funded by the lump sum allocation. Please submit the updated Form B and/or Form S to the B&F analyst assigned to your department by 4:30 p.m. on Wednesday, November 21, 2012.

Due to the tight timetable to produce the FB 2013-15 Multi-Year Program and Financial Plan and Biennium Budget, please note the following due dates which are upcoming in the budget process:

1. By Friday, December 7, 2012, the following must be submitted, reflecting the Governor's budget decisions:

• Updated BJ Summary Tables in eBUDDI or, for departments with their own budget systems, other electronic files.

• Two copies of each Budget Narrative, with electronic file(s) transmitted to your B&F analyst.

• Updated Performance Measures in eANALYT.

• Two copies of Tables P, Q, and R (as updated in eCIP) and Form PAB.

2. By Thursday, January 3, 2013, updated BJ Details in eBUDDI or, for departments with their own systems, other electronic files.

Additional information regarding the above submission requirements may be found in Finance Memoranda Nos. 12-12 and 12-14, Fiscal Biennium 2013-15 Executive Budget Request and the Program and Financial Plan for the Period 2013-19.

Thank you for your prompt attention and understanding in this matter.

Attachment(s)