State of Hawaii Enterprise Financial System

Money Talks is a recurring series that breaks down the basics of public sector accounting, finance, and their real-world impact on the EFS Project and the State of Hawaii. In this session, we’ll discuss “appropriations and allotments.”

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What are appropriations and allotments, and how are they related?

Appropriations are funds set aside for specific purposes through the State of Hawaii’s biennial budget process. To manage public funds effectively, the State uses three main tools: appropriations, allotments, and encumbrances. Appropriations are the total funds allocated for a program or project, while allotments are portions of this total that get released gradually each quarter.  This gradual release of funds helps the State manage cash flow and prevents overspending.

In our last Money Talks segment, LaDonna explained how encumbrances work as commitments to spend part of an allotment:

For example, a $10 million appropriation for education might be divided into quarterly allotments of $500 thousand for school construction projects, $750 thousand for teacher salaries, and $1.25 million for textbooks and supplies. Encumbrances then record obligations like a $500 thousand purchase order for textbooks within the first quarter textbooks and supplies allotment.  This ensures funds are set aside for payment and prevents overspending the budget.

About Mariel Kim

Mariel brings extensive knowledge and strong interpersonal skills to her role as a Senior Business Analyst for the EFS Project.

With six years of dedicated service to the State of Hawaii, Mariel has gained valuable experience as an Accountant with the Department of Accounting and General Services and as a Business Analyst for the HawaiiPay Project, which modernized the State’s payroll and time/attendance system. In July 2022, she joined the Office of Enterprise Technology Services, where she continues to support statewide IT projects and lead her team to enhance the State’s technological infrastructure.