Faced with uncertainty and cutbacks at the state level, Mayor Mitch Roth on Monday released the first proposed budget of his term, described by staff as a “bare bones” plan as the county grapples with the fiscal aftermath of the coronavirus pandemic.
The $590.8 million spending plan is just $4.8 million more than last year, a scant 0.8% increase. That funding comes from a 3% increase in property tax revenues due to increased values, bringing in an additional $9.9 million.
But the county this year, for the first time, is required to set aside $3.2 million to its disaster recovery fund, thanks to a charter amendment approved by voters last year. And it’s starting the budget year July 1 with $8.7 million less in carryover funds from the previous year.
The county is also on the hook for $1.3 million for lifeguards at two state beaches, Kua Bay and Hapuna, after the state Legislature took away their funding. County emergency medical services funding and the 911 fund paid by telephone subscribers, are also at risk of being swept up by the state.
And, for the second year, the state is withholding the counties’ share of the transient accommodations taxes, a surcharge on hotel rooms and short-term rentals, to balance its own budget.
“The state is trying to balance the budget of the state on the backs of the counties,” Roth said. “We have a balanced budget but we have to pivot some more based on what’s happening in the Legislature.”
In addition to property taxes, increases on the revenue side of the ledger include $3.3 million in grants and $1.2 million more in charges for services, primarily due to increases in sewer charges and garbage tipping fees.
Roth noted that lifeguards at Kua Bay last year performed more than 127,000 preventative actions — such as whistling a swimmer a warning to avoid dangerous areas — and those at Hapuna Beach performed more than 165,000.
“Those are state facilities where our county is being asked to provide services,” Roth said.
Increases in employee benefits, especially health insurance, took another big chunk with a $7.5 million increase.
There are no positions cut or furloughs in the budget, but the county is acting slowly to fill vacancies, and there is “no all-out hiring freeze,” Roth said.
Nor are raises anticipated. All of the public worker unions’ contracts end June 30 and all are in the process of collective bargaining at the state level. Under the rules for most unions representing county employees, each of the four county mayors get one vote while the governor gets four votes at the bargaining table.
“We’re not anticipating pay rate increases of any kind next year,” said Finance Director Deanna Sako.
The mayor will release a final proposed budget May 5, and the County Council will take over, setting expenses and the revenues to pay for them. By then, the Legislature will have adjourned, reducing the uncertainty over what money might be available.