City Council members questioned the wisdom of plans by the administration to curtail some city services to make up for a projected $26 million shortfall in the recently adopted $1.8 billion operating budget.

"I don’t know why they’re doing these things when they acknowledge we had a balanced budget," Council Budget Chairwoman Ann Kobayashi said Wednesday after questioning administration officials at a hearing.

Mayor Kirk Caldwell defended the estimated $20 million in cuts that will close the Kailua/Enchanted Lake Satellite City Hall, reduce police and fire recruit classes and curtail tree trimming as prudent steps to protect against a greater shortage that could lead to decreases in more essential services.

"We are concerned, as we go forward this fiscal year, that we could face a shortfall," Caldwell said after the committee meeting. "We’re not going to allow that to happen. I believe that would be political malpractice."

Recent revelations of the projected shortfall just two months into the fiscal year have led the mayor and Council members to accuse each other of fiscal mismanagement.

As reasons for the shortfall, Caldwell has cited the Council’s failure to approve an increase in the city’s fuel tax that he said would generate $15 million, the Council’s decision to award up to $9 million in grants to nonprofits, and a larger-than-anticipated collective-bargaining agreement with police officers.

Council members countered that they passed a balanced budget and the overspending was due to the administration’s premature assumption that the fuel tax increase would be adopted.

Disagreement Wednesday stemmed from the allocation of money for vacant funded positions. The Council this year reassigned the funds from all departments to a single provisional account overseen by the Budget Department.

The higher-than-expected collective bargaining increases and other costs that would typically be covered with money set aside for vacant positions left fewer dollars to spread to various departments for budgeting purposes, Nelson Koyanagi, city budget director, told committee members.

Kobayashi said she remained unclear on how the administration is projecting a shortfall when it received the same amount of money for the positions that it requested and that the money was simply allocated to a single account.

"It’s the same amount of money and they keep saying they’re short, so I just don’t understand what they’re talking about," Kobayashi said. "If we had left the money in each department would they still be short? It seems because we moved the money somehow they’re $26 million short."

Council members also criticized the administration for not anticipating a larger increase in the police and fire contracts based on past history of arbitrator awards.

Caldwell acknowledged he does not believe the budget is imbalanced, but his administration was cutting costs to be cautious.

The administration has introduced a variety of bills aimed at dealing with the shortfall through reining in some real property tax exemptions.

"We wanted the Council to know what we’re doing to cut costs," Caldwell said. "We wanted them to know there’s going to be additional pressure next fiscal year and if we don’t look for ways to increase revenues in the fairest way possible, with the minimal amount of impact on different sectors of the community, we’re going to have to do further cutting."