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$176M city deficit warned


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POSTED: Wednesday, March 04, 2009

Additional fees for city services, consolidation of government functions and a further assessment of essential programs are all possible in the coming years as the city struggles to overcome current and future budget deficits.

               

     

 

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Even if Mayor Mufi Hannemann's $1.8 billion operating budget for fiscal year 2010 is wholly adopted by the Council — with all of its proposed tax and fee hikes — that would get the city through only the $50 million budget shortfall.

There still would be a looming deficit of $176 million for the 2011 fiscal year.

Each fiscal year begins July 1.

“;We're not waiting for the end of the fiscal year,”; Hannemann said. “;I'm addressing it right now.”;

Hannemann on Monday unveiled his 2010 budget, proposing increases in real property taxes, some bus fares, zoo admission prices and public golf rates to help make up the shortfall.

He says his administration plans to review all fees and determine whether increases are warranted to address the future shortfall. One new fee that is likely to be imposed is for garbage collection and recycling.

“;We've got to be the only place that really supplies everything without a fee,”; Hannemann said.

Also being studied is the creation of a homeowners class for real property taxes, to address the issue of speculators and part-time residents, giving more of a break to those who actually live on their property.

He also plans to examine the possibility of consolidating services — such as folding Emergency Medical Services in with the Honolulu Fire Department — and assessing whether all programs meet the definition of essential city services.

Hannemann has made it clear that nothing should be considered a sacred cow.

“;I've even thrown out there ... as much as I love music, as much as I love art and drama and the like, whether it's still an appropriate function for the city to have the Royal Hawaiian Band,”; Hannemann told Star-Bulletin reporters and editors. “;I love music more than any other mayor that has sat in my job, but that's something, too, that doesn't fall under the definition of core city services.”;

Councilman Nestor Garcia, the budget chairman, said he agreed that everything needs to be put on the table. He said he was even willing to examine the need for one of his preferred projects, TheBoat.

“;Everybody has to put in their sacrifices,”; Garcia said. “;One of the things I liked about the mayor's approach is it's not just 2010, but 2011, too.”;

Councilman Duke Bainum, who sits on the budget committee, said he's hopeful the council can avoid tax and fee hikes, “;but we have to also be realistic and know that we're in uncharted financial territory.”;

Councilman Charles Djou, also a budget committee member, criticized the growth in government spending under Hannemann, noting that the final operating budget submitted by former Mayor Jeremy Harris in 2004 was $1.2 billion.

“;I think we have to look at a wholesale revision of the way the city government operates,”; Djou said. “;This is far, far, far too much spending and it's fiscally irresponsible.”;