Busting the budget

WAILUKU – Maui County Mayor Alan Arakawa is proposing a double-digit increase to the county’s budget for the fourth time in the last six years, though he says it’s necessary to catch up with lagging infrastructure needs and to pay for recent expenses like collective-bargaining agreements.

Arakawa announced his proposed $711.5 million county budget for fiscal year 2017, which runs from July 1 to June 30, 2017, in the Mayor’s Conference Room on Thursday. The mayor’s budget totals $90.8 million more than the $620.7 million budget adopted for fiscal year 2016 – which is a 14.6 percent jump.

“This year’s proposed budget . . . is a commitment to this community, to make good on the promises that we made to fix and improve areas of this county,” Arakawa said. “In the end this is the people’s budget, and it is in your hands.”

With the proposed budget, residents would see increases in water, sewer, curbside trash pickup and landfill fees. Water and sewer user fees would climb by 5 percent, while trash collection would go up by $2 a month for Maui and Molokai and $1 for Lanai.

For the average single-family home using 16,000 gallons of water a month, this means bills would go from $70.40 to $72.95 a month, county Budget Director Sandy Baz said.

Monthly maximum sewer charges, meanwhile, would climb from $61.65 to $64.30. Trash collection on Maui and Molokai, which receive once-a-week manual or twice-a-week automated service, would rise from $22 to $24 a month. Lanai residents, who get once-a-week trash collection services, would see rates go from $11 to $12 a month.

He also proposes increasing the county’s share of the fuel taxes for gas and diesel from 18 to 23 cents per gallon.

“The administration believes that the increases requested are reasonable for the average family to afford and justifiable costs to continue providing services that the community expects,” Baz said.

While the mayor is not proposing increased property tax rates, valuations have gone up – raising the county’s expected revenue from real property taxes by 8.3 percent. This could mean higher property tax bills for residents, even as rates remain the same.

Real property taxes make up the county’s largest single source of income, generating 42.8 percent of all county revenues. The Maui County Council sets property tax rates annually in 10 property tax classifications, including residential, apartment, commercial and hotel.

While council members said they wanted to review the mayor’s budget proposal before commenting on specific details, tax hikes concerned council Chairman Mike White.

“Realistic spending is key, and we cannot keep increasing the tax burden on residents,” White said. “Anything new is wonderful, but we first must maintain what we have.”

One source of revenue the mayor hopes to see more of in fiscal year 2017 is the transient accommodation tax, which the state levies on the amount visitors pay for hotel rooms. The state previously capped the counties’ share of room tax revenue, but proposed legislation would remove the cap. That would give Maui County $36.9 million in transient accommodations tax revenue, a 58.7 percent increase, although Arakawa acknowledged that this was an estimate subject to change.

The Legislature, which currently is in session, will determine Maui County’s share of the TAT.

“The legislation will do what the legislation will do,” he said. “At the same time, on the other side, we don’t know everything the legislation is going to appropriate to the county. Sometimes they appropriate more.”

Of the $711.5 million in county funds in the mayor’s budget, $563.6 million would go toward the operational budget and $147.9 million would go to capital improvement projects.

The mayor’s budget proposes adding 45.8 jobs, taking the county workforce from 2,633.9 to 2,679.6, a 1.7 percent increase in personnel.

The administration aims to move lifeguards from the Department of Parks and Recreation to an ocean safety program within the Department of Fire and Public Safety, a transfer of 60.5 positions that has been stalled due to labor union issues. The change was mandated by a County Charter amendment approved by the voters.

The mayor also wants to add a Homeless Division in the Department of Housing and Human Concerns that would require three additional staff members, although overall the department’s staffing would drop.

The focus of the budget’s capital improvement projects would be on road, wastewater and water supply improvements. The spending plan calls for digging wells and expanding water storage systems in both West Maui and Upcountry, as well as resurfacing roads countywide.

The capital improvement program lists anticipated parks and recreational facilities, including a $1.2 million Upcountry skate park that could begin construction this year, and a new gymnasium and exhibition hall at the War Memorial Complex that would cost $40.5 million to design and construct over the next few years.

The mayor said in the past five years, “the biggest change is how we’ve approached infrastructure.” Before, projects were simply deferred and not included in the budget. These delayed projects have warranted proposed budget hikes, Arakawa said.

Now there’s a backlog of needs that the county is trying to catch up on, he said. In addition, the county is trying to address recent increases from collective-bargaining agreements with labor unions.

The County Council will begin reviewing the proposed budget Wednesday. Council members need to take final action by June 10. The new budget goes into effect July 1.

“I am hoping that the public will pay close attention to the subjects we are discussing,” Council Member Gladys Baisa said. “If people have concerns, I wish they would come, because that’s the way we make the best decisions.”

The mayor’s budget can be viewed at mauicounty.gov/

budget.

* Colleen Uechi can be reached at cuechi@mauinews.com.

* This article includes a correction from the original published on Friday, March, 25, 2016.