Buoyed by rising property values from a robust real estate market, the annual budget proposed Tuesday by Mayor Mitch Roth comes in at $689.9 million, a 13.1% increase over the previous year.
The no-new-taxes plan anticipates $45.4 million more from property taxes through increased evaluations as well as $11 million more in grants and a general excise tax surcharge of $50 million, a $12.5 million, or 33.3% increase over this year.
A local option transient accommodations tax on hotel rooms and short-term rentals went into effect Jan. 1. It’s expected to raise $13 million, short of the $19 million the county collected before the state Legislature zeroed out the counties’ share of the tax.
The money would be used to add 39 new positions and convert 12 positions from part time to full time. Other employee-related cost increases include an additional $14.4 million for post-employment benefits and $11.7 million to cover expected union raises being negotiated at the state level.
In addition, the budget gives Mass Transit an additional $11.6 million to align operations with its master plan, $9 million was earmarked for homelessness programs by a bill currently in the County Council, the sewer fund was increased by $3.8 million and the solid waste fund by $2.8 million to help pay for required repairs and maintenance.
“There are so many needs,” Roth said. “We have some really significant needs in our county.”
Roth said he came into office in late 2020 much like a new homeowner, anticipating only the best. Instead, the foundation is crumbling, the pipes are rusting, the electricity is problematic and the roof is leaking. All of that takes some money to fix up, he said.
“On the bright side, I’ve got great neighbors,” the mayor quipped Tuesday afternoon during an interview in his office.
Seriously, though, Roth said, he sees sustainability, one of his campaign priorities, as essential to getting the county on track. Affordable housing is a huge component of that, he said.
“We want to make sure that our kids can raise their kids here,” he said.
In addition to continuing clamping down on illegal transient vacation rentals, Roth sees a need for increased housing islandwide.
“We need housing for our local families to move into. In order to do that, there’s got to be some development, and I know not everyone is in favor of development,” Roth said. “If we want to give our kids a shot, we need it.”
The mayor said there may have been 1,000 affordable housing units in the pipeline when he took office. Now there’s about 5,000. But estimates place the need at 10,000 to 15,000 new units by 2025.
There’s also $100,000 in the budget to increase recruitment of employees, a critical issue in Hawaii County as it is nationwide, noted Managing Director Lee Lord. An additional $500,000 is going for grant writers to take advantage of the new federal funding expected this year.
The preliminary proposed budget goes to the County Council for consideration. The council plans three days of department-by-department budget analysis in mid-April, and the mayor’s final proposed budget then comes to the council May 5.
Once approved, the new budget goes into effect July 1.