Maui County Mayor Alan Arakawa said Friday that the difference between his $574 million budget proposal and County Council Budget Committee Chairman Mike White's $551 million basically status-quo plan is a long-term versus a short-term view of the needs of Maui County.
In a short interview after his appearance at a Maui Chamber of Commerce luncheon, Arakawa explained that his administration is having to deal with years of lack of maintenance and updates to county infrastructure.
"We are on the end of the stick having to catch up on stuff that just wasn't done," he explained. "That's our dilemma."
Mayor Alan Arakawa, Maui Chamber of Commerce President Pamela Tumpap (middle) and former Council Member Alice Lee pose for a photo at a chamber luncheon Friday at the King Kamehameha Golf Club. The mayor was the featured speaker at the event.
The Maui News / JOE BRADLEY photo
Some county buildings, water pipes and roads are at the point where the county cannot "finagle our way through anymore."
"We have to face these challenges as real challenges or the community is really going into a tailspin," he said.
The mayor views the lack of water resources, potholes in the roads and insufficient park space for youth teams to practice as "major challenges to be fixed."
To do this, taxes will have to be raised, Arakawa said. His proposal calls for property tax increases ranging from 4.8 percent for the apartment classification to 13 percent for those in the improved residential classification. His plan keeps current rates in the homeowner category.
He said his administration decided against higher taxes in the homeowner class because the last budget raised homeowner property tax bills as much as 38 percent.
He believes the council will recognize that some taxes and fees will have to be raised, and council members were doing so late Friday night. White's proposal introduced Monday called for no increases in property taxes and a budget only $1 million more than the current year budget.
White said that if taxes have to be raised they should target homeowners first because they have carried substantially less of the burden than those in other categories and those in the homeowner category generally use the majority of county services.
Arakawa said he would prefer not raising any taxes, adding that "I don't like paying more taxes either," but the repairs and improvements to the county's infrastructure must be made.
Taking a shot at White, who is the general manager of the Ka'anapali Beach Hotel, Arakawa said that the method the council member is employing "may work in the private sector for his hotel, but it certainly is not going to work in a government system that has to go through all the permitting process."
The mayor said that "the council right now is having some very serious debates among themselves to try to come to some kind of equilibrium. I think at the end of the day the council will come up with a fairly decent budget."
The council's Budget and Finance Committee hopes to have a budget plan completed by today. The council has until June 10 to pass a budget or the mayor's budget will take effect.
During his talk to chamber members at the King Kamehameha Golf Club, the mayor gave an overview of the county's economy and areas of potential growth.
"While I hesitate to say that we are completely out of the recession, I will say that Maui is in a much better place than we were several years ago," Arakawa said.
Unemployment is down, construction is revving up and the tourist industry is humming along "on all six cylinders," he told the audience of businesspeople and government officials.
The tourism industry is reaching its maximum with no more rooms for additional visitors, he said, so the recent double-digit growth will be leveling off. What has to be done now is to improve and maximize the visitor experience.
"We have got as many visitors as we can handle," the mayor said. "Now, let's entice them to pull out their wallets."
The mayor noted the greater numbers of tourists from Asia and New Zealand and Australia, who are benefiting from favorable exchange rates. He singled out Chinese visitors with "money to spend, and they want to travel."
Chinese visitor numbers have risen 28 percent in the state, and they spend an average of $400 a day, Arakawa said.
And while tour groups favor Oahu, the more affluent travelers prefer Maui, he said.
Personal relationships are key in developing the Asian market, the mayor said. County officials have made those personal contacts through trips to Asia and sister city arrangements, and the mayor said he hopes local businesses will benefit from and take advantage of those relationships.
Arakawa noted that next month Chinese officials will be traveling to Maui for the unveiling of a statue to Sun Mei, the older brother of Chinese revolutionary Sun Yat-sen. The University of Hawaii Maui College, in partnership with others, will be holding a workshop to aid local businesses with the Chinese tourist.
"These are exciting times for Maui County." Arakawa said. "We have the potential to grow our economy above and beyond anything we have seen before."
* Lee Imada can be reached at firstname.lastname@example.org.