Mayor Peter Carlisle today unveiled a $1.953 billion city operating budget for the upcoming fiscal year that is $28 million more than last year but balances with no increase in real property tax rates.

Carlisle called the budget "responsible," saying it focuses on core city services and saving for the future to fund future obligations and help maintain the city’s high bond rating.

The administration also put forth a $577 million construction budget that primarily focuses on wastewater collection and treatment systems, road repair and maintenance and public safety.

Carlisle presented the budget at a news conference today in his office. 

"The bottom line is, continuing to make the difficult choices today will lead to long term fiscal stability," Carlisle said.

The budget for the city’s $5.27 billion rail transit project is covered by the semi-autonomous Honolulu Authority for Rapid Transportation and not included in the Carlisle administration budget.

Carlisle’s budget relies on $41 million in hotel room tax money allocated to the county by the state and $808 million in real property tax revenue, up $20 million from a year ago. The surge was due primarily from development projects and improvements to existing properties, such as the new Disney Aulani Resort, the Ward Centre parking structure and the new Lowe’s home improvement center.

The $28 million increase in the operating budget is due primarily to rising electricity and fuel costs, Carlisle said.

The operating budget also includes $1 million for pavement preservation work to improve road maintenance, $300,000 to increase the spay/neuter certificate program and $200,000 for a pilot program to replace existing parking meters with advanced meters and censors. The budget did not include a proposal to raise parking meter rates.

The operating budget also includes funding for future obligations, such as employee retiree benefits and the rainy day fund. Carlisle’s budget includes $40 million for the health fund costs for retirees, known as Other Post-Employment Benefits or OPEB, and $20 million to the city’s rainy day fund.

"In the long run, saving will bring stabilization and protect against economic or revenue downturns and emergency situations," Carlisle said.

The $577 million Capital Improvement Program, or construction budget, is $30 million more than a year ago, due mostly to sanitation projects required by the 2010 consent decree with the federal government to improve wastewater collection and secondary treatment systems, and improvements to the HPOWER waste-to-energy facility, where a third boiler is scheduled to go online later this year.

Capital projects, which are financed by bonds, include $331 million for wastewater facility and collection systems, $97 million for highways and streets, $45 million for public safety, $32 million for general government spending, $30.8 million for non-rail related transportation projects, $23 million for culture and recreation and $19 million for human services projects.

Carlisle also announced shifting vehicle equipment purchased from bond financing to cash, to reduce the amount of debt owed by the city.

As he did last year, Carlisle said his budget aims to reduce the amount of city projects financed by debt, noting that for the first time in eight years will be lower than the previous fiscal year by about $7 million.