• County budget 2005-6 County budget 2005-6 The County of Kaua‘i is looking at a $122-million county operating budget, and an $18-million capital-improvement budget, for upcoming fiscal year 2005-2006. This is a sizable jump from the 2004-2005 budget, which had
• County budget 2005-6
County budget 2005-6
The County of Kaua‘i is looking at a $122-million county operating budget, and an $18-million capital-improvement budget, for upcoming fiscal year 2005-2006.
This is a sizable jump from the 2004-2005 budget, which had some $98 million in the operating budget and about $19 million in capital-improvement funds.
The funds for what looks like a 20 percent jump in county spending is mostly coming from a jump in property values on Kaua‘i, as reflected in property tax assessments.
This jump may come back to haunt the county.
The debate on limiting property taxes for residents of Kaua‘i who own and live in their own homes fulltime continues, but is reflected in changes being politically forced on the county government. This comes after the Ohana Kauai charter amendment – which would have capped property tax rises, and rolled them back, for this group – was knocked back in state court.
The jump in property tax valuations reflects the red hot real estate market on Kaua‘i in which property values have doubled and tripled in some cases since the year 2001. The debate over property taxes has overshadowed the nuts and bolts of the county budget.
There are some positives in how the county administration anticipated some events, which are reflected in the budget.
The County of Kaua‘i showed good planning in anticipating a hefty boost in government workers’ paychecks, and Kaua‘i isn’t suffering some of the trauma of other counties in Hawai‘i which are struggling harder to make up this somewhat unexpected difference.
In looking over the general operating budget, the bulk of which is based on fixed costs of operating the county, one can see a reflection of the growing size of the population of the Island, and the needs this growing population is putting on county services. Much of the growth is coming in high-income areas like Po‘ipu and the North Shore, where affluent baby boomers are arriving on Kaua‘i. They are displacing a growing number of longterm residents, young and old, who are leaving the Island because of extremely high real estate costs. It’s arguable if affluent residents moving into new homes put more of a strain on county spending then those in existing dwellings; the new residents are for sure adding millions to county property tax coffers.
Looking down the road, the budget for 2006-2007 should tell us even more about the future make-up of Kaua‘i’s society. Will we become an Island of haves and have-nots, with an ever-smaller middle class wedged in the middle?
Looking over the capital improvement line items in the new budget, some specific projects are receiving the bulk of the funding. The purchase of additional lands at Black Pot Beach Park at Hanalei may not be that noticeable in the future, as the additional land is already wide open and undeveloped and looks like it’s already part of the beach park. However, if the county lets this land go and it was developed, the look and feel of this popular park near the Hanalei Pier would change with potential private development a likely event.
Needed repairs are also coming to neighborhood centers across the Island. The centers are important to the social life of our communities, and a worthwhile investment.
The high monetary numbers of the budget reflects the good economic times we are living in. There is optimism in our local government that rising property values and overall prosperity for many should be reflected in increased government spending. This issue is sure to be one debated in the public forum during the coming year. We will see if the increased spending means an increase in quality of our local government, and if the capital improvement projects are being undertaken in a cost-effective and timely matter.
If the economy dips, along with the bursting of what may be a “bubble” real estate market, we may see a day of reckoning in nine or ten months if the economic tax generator that’s spinning at full speed right now begins to sputter.
Outside of the county budget, the .5 percent increase in our county’s excise tax that’s in the hands of our elected officials right now is not needed on Kaua‘i. The mass transit project planned on O‘ahu needs to be funded by the people of O‘ahu. The reasoning behind an excise tax increase on Kaua‘i to boost mass transit projects here doesn’t hold water. It seems like this boost would mostly end up in the bottomless state general fund. If this excise tax increase is initiated there will be political consequences for its backers. With an all-time high county budget fueled by property tax increases, we don’t need more taxes, especially an excise tax that will hit our lower income homes hard.
