City’s financial City Budget Director Caroll Takahashi is warning that the city will likely get less revenues than anticipated as a result of the economic downturn since Sept. 11.
forecast gloomy
Economic woes and security
concerns hurt expected revenuesBy Gordon Y.K. Pang
gpang@starbulletin.comMeanwhile, city officials are hoping that a $5.3 million "rainy day fund" will be able to cover the costs of security measures associated with the response to potential terrorist attacks, suspected dengue fever cases and anthrax scares.
The city's share of the state transient accommodations tax, better known as the "hotel room tax," may drop by between $5 million and $7 million from the $30 million to $33 million that had been anticipated, Takahashi said.
Additionally, the city's investment income will drop to about $12 million from an anticipated $19 million because of lower interest rates. But the lower rates also mean that the city will save about $6 million in expected debt service.
The city expects no immediate impact on property tax revenues, she said.
Takahashi said that she expects to send a bill to the Council by the end of the year seeking authority to use the emergency rainy day fund set up by the Council several years ago.
Budget Committee members hoping to get specific cost figures from police, fire, emergency services and other agencies, however, were out of luck as each department official said it was too early to tabulate numbers.
Pressed after the meeting by reporters, Takahashi said she expects the rainy day fund to cover the additional costs but added that the total will ultimately depend on how long the heightened concerns last.
Maj. Susan Ballard, head of HPD's finance division, said overtime costs are being incurred for such things as extra security at key locations around the island. How much the extra work will cost taxpayers will not be known until at least next week, she said.
"What we're trying to do is develop a good foundation, take a look at everything that we have, and see where we can cut, where we can improve, without having to worry about cutting any type of services or anything to the community or public safety," Ballard said. At this point, she said, "no programs are going to be cut" although some hiring may be delayed.
Assistant Fire Chief Alvin Tomita said anthrax and dengue fever calls have required increased manpower and equipment costs. Tomita said overtime costs include two, three-person assessment teams that have been formed to deal with the increase in anthrax calls.
Ross Sasamura, the city facilities management director, said his road maintenance division has been collecting bulky items, often considered potential breeding grounds for mosquitoes that transmit dengue fever, as has the refuge division of the Department of Environmental Services.
Sasamura said no overtime costs have been incurred. The two agencies simply have shifted priorities, he said.
Council Budget Chairman Steve Holmes indicated the Council will likely look favorably on using the rainy day fund to pay for costs.
"Obviously it does appear to be raining these days," Holmes said.
City & County of Honolulu
