Just last month, the City Council’s Budget Committee was sizing up potential budget cuts to cover Honolulu’s $44 million share of rail costs next year. Now, with swiveling budget choreography in the works, city leaders have put away that scalpel.
What’s more, with its last go-around last week on Mayor Kirk Caldwell’s proposed $2.61 billion operating budget for fiscal year 2019, the Budget Committee further loosened its tight grip on spending by folding in funding to hire additional paramedics, firefighters, zoning inspectors and stream cleaners.
Given the city’s ever-growing service needs, the move to create more than 40 new jobs may be a worthy one. But before final sign-off, the Council should double-
check workforce efficiency. Also due thorough consideration: long-term costs tied to expanding the employee roster, such as the steep price tag tied to pensions — the Employees’ Retirement System now provides benefits to more than 122,000 active, retired and vested former state, city and county employees.
Among the proposed hires, there’s compelling argument for six new housing and zoning inspectors tasked with enforcing existing restrictions at illegal transient vacation units (TVUs). By some counts there are well over 20,000 scofflaws in Hawaii, mostly on Oahu. That eye-popping figure elicits a not-surprised response among many residents. It’s painfully apparent that by failing to effectively crack down on illegal operations or expand the legal inventory in nearly three decades, the city has missed out on megabucks in fines or tax revenues, respectively.
However, with the city Department of Planning and Permitting now devising a new set of rules for TVUs that would allow for permitting additional B&Bs while placing harsher penalties on those who violate zoning and building codes, hope glimmers for a more-balanced regulation and much-tougher enforcement.
The budget bills weighed by the Budget Committee will go to the full Council for a final vote next month, and the new fiscal year begins July 1. City leaders are betting that a maneuver pitched earlier this month by new Budget Committee chairman, Councilman Trevor Ozawa, will allow a side-stepping of the rail project’s $44 million snag, which city leaders seem to agree is little more than an on-paper problem caused by different financial projections.
Due to a current solid cash flow, the Honolulu Authority for Rapid Transportation (HART) doesn’t need the $44 million in the near-term. Even so, the city’s federal transit partner wants to see that funding on the ledger in some shape or form.
So Ozawa’s proposal puts a sort of $44 million placeholder in HART’s capital budget, which typically covers construction costs funded by state and federal tax dollars. The placeholder would be backed by city operating dollars — in the form of a possibility of floating bonds to cover that slice of funding.
Caldwell had proposed a somewhat similar plan — parking the placeholder in the city’s general capital budget. Ozawa’s HART option may work better as it separates the placeholder from other city projects, and could yield better transparency in spending.
A few months ago, Council leadership, headed by Ernie Martin, rightly balked at even a possibility of tagging bond money for HART operations. If bonds are ever actually issued, taxpayers would end up paying more because of interest on the bonds — and the move could open the door to other funding grabs, such as money needed for operations when the transit system finally begins shuttling riders. It’s preferable to keep that door shut.
However, with the Federal Transit Administration insisting on including some representation of the $44 million slice in rail’s financial recovery plan, the city is wedged between a rock and a hard place. Rather than opting for needless cuts to city services, the Council should proceed with this placeholder strategy and offer a prudent budget for fiscal year 2019.
