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The Coffee Party
March 23, 2011 - Harry Eagar
I was astonished, almost shocked when Mayor Arakawa introduced a budget $100 million bigger than Mayor Tavares' last budget.
Tavares did not leave office with a lot of accomplishments she could point to, in particular nothing doing on water, but she was ahead of the other mayors in understanding that county revenue was going to contract and in beginning to contract county spending in advance. This was prudent and, since the county cannot run a deficit, allowed a more thoughtful approach than the pellmell hacking that the governor was pushed into.
The governor had at least the excuse that state revenue dropped sharply without much warning.
Since Arakawa had mentioned some new spending in mind, I would not have been surprised if he had brought in a budget no lower than Tavares', but it never crossed my mind that it would be higher. I think he should have looked for more shrink. It's true that tourism is recovering somewhat, but it's a long way from recovered, and every other leading and coincident indicator signals continued stringency in county revenue: building permits, electricity sales and the county's own assessments of real property among them.
I got my property tax statement the day after the mayor's message, and the county believes my house and lot are worth less than last year on the market, although it continues to be worth the same to me. In particular, the land assessment is way down. (Oddly, the separate valuation of the house is up; it's true the house has a new $12,000 roof, but otherwise it's a year older, which hardly seems to justify a $50,000 jump in the value of the building.) Significantly, after 20 years, the county assessment for 2010 is just about what we paid two decades ago, allowing for the magical effects of the compounding of even fairly low monetary inflation over that long. Maui real estate is not a wealth generator just now.
A month ago, I was expecting a stringent county budget. By the time Arakawa spoke, I would have thought he would be warning of a correction downward, since the Japanese situation is bound to affect Maui business. Direct Japanese tourism doesn't amount to a great deal here, but it does to Oahu, which is going to take a big hit. When Oahu takes a hit, the Neighbor Islands are bound to feel the reverberations.
We need a name for politicians -- who are not numerous right now -- who come into office and spend what previous politicians saved, which is what Arakawa says he is doing. Coffee Party, perhaps: "You save it, we spend it."
(I do not mean to imply that Tavares was a Tea Partier.)
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