Hawaii County Council members seem to prefer a cautious approach to county spending, despite a budget windfall that has Mayor Mitch Roth proposing a $779.7 million spending plan, a 27.8% increase over the current year.
The county is flush with cash thanks to a $140 million infusion of federal relief funds and a super heated real estate market that sent property values skyrocketing.
Roth is proposing rolling back property tax rates to provide some relief, but the budget also includes a wealth of new spending, including the addition of 88 new employee positions.
Finance Director Deanna Sako, presenting the operating budget Thursday at a special meeting of the council, said the balanced budget represents the administration’s efforts to catch up on long delayed maintenance projects, while providing affordable housing opportunities and other needed social services. The figure amounts to an average of $3,135 per resident.
“We’re laying the foundation in this budget,” Sako said.
The largest spending category in the budget is public safety, costing $175.7 million. That includes police, fire, civil defense, prosecutors, animal control, liquor control, flood control and building inspection, Sako said.
That’s followed by a miscellaneous category at $163.6 million, followed by employee pensions and retirement accounts at $83.6 million and the health fund, at $67.9 million. Payments on county borrowing will cost $58.6 million this year.
But most council members wanted assurances the county would hold enough money in its coffers to protect taxpayers against the lean times that appear to be on the horizon.
“Do we have to spend every dollar that comes in or is there a way to carve some of this out for contingency plans?” asked Puna Councilwoman Ashley Kierkiewicz, the sole no on a 6-1 vote to pass the operating budget, Bill 126, on the first of two readings. Hilo Councilman Aaron Chung and Hamakua Councilwoman Heather Kimball were not at the meeting.
“Obviously we’re flush — great — but how long is it going to last?” asked Puna Councilman Matt Kaneali‘i-Kleinfelder.
Sako said the county’s budget stabilization fund currently holds about $7 million.
Kierkiewicz wondered whether the county has the capacity to spend that much extra for projects, now that’s it’s “awash with cash.”
“Are we investing too much too fast? … I support the investments we’re making (but) I want to make sure at the end of the day the community knows we can deliver,” Kierkiewicz said. “People want to see the return on the investment.”
Hilo Councilwoman Sue Lee Loy agreed. The county currently has quite a few vacancies and adding 88 more positions at more than $3 million annually could be a challenge to fill with warm bodies, she said.
“There are a bunch of new positions,” Lee Loy said, wondering if it’s “too much, too fast.”
Sako responded that even if positions are vacant, “somebody has to do the work,” and money gets spent in overtime instead.
Kohala Councilman Tim Richards presented a spreadsheet comparing county budgets over the years. He noted county spending has increased 252% since 2000.
“On the one hand, we have so any needs of this county that have been deferred, deferred, deferred,” Richards said. “We are coming out of it, we are recovering, but we’re not recovered.”
North Kona Councilman Holeka Inaba wasn’t satisfied with how proposed rate rollbacks were contemplated by the administration and said he’d be submitting his own rollback plan in the form of a resolution for the council to consider.
The council has until June 20 to set property tax rates. The new budget will go into effect July 1.
