Council approves $122 million budget

LIHU‘E — County Council Committee of the Whole members Tuesday sent to Mayor Bryan J. Baptiste a $122-million county operating budget and an $18-million capital-improvement budget for the next fiscal year.

The proposed operating budget provides significant tax relief to owners of commercial, hotel and resort, apartment and industrial properties, following demands by homeowners for significant tax relief as assessments climb due to a hot real-estate market.

The legislators, in line with what Baptiste has requested, are recommending a $1.25 reduction per thousand dollars of evaluation for the land portion of tax bills.

Thousands of homeowners, those who live in their homes and own them and had the biggest gripes about skyrocketing assessments, won’t see any tax-rate drop.

But they will benefit from a council measure that reduces the cap on yearly tax bills from 6 percent to 2 percent. The measure also had been supported by Baptiste, and has been sent to him for his signature.

Both initiatives amount to efforts by the mayor and the council to “spread around” tax relief, councilmembers said earlier.

The council version of the budget provides funds to rehabilitate nine neighborhood centers, resurface more roads, improve the system for disposal of garbage, and improve the public bus system.

The full council is scheduled to meet at the historic County Building on Monday, May 23, to vote on the proposed $122-million county operating budget and the $18-million capital improvement budget.

The proposed $122-million budget is about $3 million less than the proposed $124.9-million budget Baptiste sent to the council on March 15.

The $18-million capital-improvement budget is a little more than $2 million more than the $15.7-million capital-improvement budget Baptiste sent to legislators on the same day.

The increase is tied to a land-acquisition matter on a proposed expansion of Black Pot Park in Hanalei; bathroom improvements at Isenberg Park in Lihu‘e; improvements at the Wailua motocross track; and additional road resurfacing in Kilauea, Hanapepe, and in other neighborhoods.

Baptiste recently sent a $119.5-million supplemental operating budget and a $19.7-million capital improvement budget to council-members.

The supplemental budgets are part of a correspondence sent to the council, and by law, the council can only act on the March 15 budgets.

The correspondence helped the council develop its budget.

James Tokioka, vice chairman of the committee, said he felt “good about giving tax relief to people who have many concerns with the valuation of properties throughout the county.” Councilman Jay Furfaro, a member of the same committee, with Councilman Daryl Kaneshiro successfully pushed through the 6-percent cap last year, said implementing the 2-percent cap shows the mayor and the council can work together for the betterment of the island community.

“I believe the council coincides with the mayor to put the 2-percent cap,” Furfaro said.

The mayor and council members are moving toward the day when they will implement one key recommendation set forth by a county tax task group, that of someday assessing a higher tax rate for buildings than for the land. This way, longtime residents won’t be taxed off their land, Furfaro said.

The difference of about $3 million in the mayor’s proposed $124.9-million budget and the council committee’s proposed $122-million budget is generally tied to the reduction in the land-tax rates.

The land rates drop by 65 cents per $1,000 of assessed valuation for agricultural land, $1.15 for conservation land, and $1.14 for single-family units. The building tax rate remains the same.

For the 2-percent cap, a person who paid $1,000 for a tax bill will not pay more than $1020 the next year, regardless of assessments.

Baptiste has gotten some criticism by some residents for $10.5 million in additional tax revenues that will come to the county in the next fiscal year.

The revenues are the result of phenomenal growth on Kaua‘i and resulting higher assessments Baptiste has no control over, county officials say.

A good portion of the funds, however, will go back to the community, through the proposed slashing of the land-tax rate. Millions also will be used to repair nine neighborhood centers, to match federal funds to enlarge the Black Pot Park in Hanalei, a popular beach spot for residents and visitors.

Some of the key proposed expenditures in the council’s committee operating budget included these:

• Baptiste recommended $100,000 for a performance audit while the council committee recommended $500,000;

• Baptiste and the council committee recommended $1.4 million to cover collective bargaining costs for firefighters and raises by the Hawaii Government Employees Association and the United Public Workers;

• The mayor recommended $280,000 for the repair of neighborhood centers, but the council committee recommended about $1.3 million;

• Both the mayor and council committee members recommended $555,000 for storm damage and flood control;

• The mayor recommended $6.5 million for the solid-waste program, while the council committee recommended $7.8 million;

• Also recommended was the use of $900,000 for a bulky-item pickup, an effort supported by the mayor and the council committee;

• $2 million to buy land for affordable-housing projects;

• $1 million to help acquire land to expand Black Pot Park in Hanalei. That would match another $1 million in federal funds;

• The mayor recommended $6 million to cover debt-service charges, but the council committee recommended $7.7 million;

• For public-improvement projects, the council proposed to use $2 million from the general fund for such projects as expanding the Black Pot Park, making bathroom improvements at Isenberg Park in Lihu‘e, and at Wailua motocross track. Councilwoman Shaylene Iseri-Carvalho said the budget advanced by the council committee is a “well-rounded. It addressed a lot of the constituent base who need the help the most,” she said.

• Lester Chang, staff writer, 245-3681 (ext. 225) or lchang@pulitzer.net.