Council reduces budget by $2 million

LIHUE — A $2 million reduction and no increase in property taxes were the result of a two-day long budget meeting.

“There’s two options ahead of us. The first would be to reduce real property taxes, but still have a real property tax increase. The second option would be to take the money from the reserve to balance the budget,” said Councilman Arryl Kaneshiro, chair of the Budget and Finance Committee.

The council on Friday approved a $201 million budget for FY 2017-2018.

In March, Mayor Bernard Carvalho, Jr., announced a proposed operating budget of $204 million for FY 2017-2018.

The operating budget also proposed a 19-cent increase in real property taxes for road repair and maintenance projects.

Because the property tax increase would have raised $3.6 million, councilmembers were trying to find that money within the budget.

They came up about $1.5 million short.

On Friday, Mel Rapozo, council chair, proposed removing the property tax hike.

“We all said from the very beginning we don’t want to raise property taxes,” Rapozo said. “This should leave a balance of about $1.5 million. To me, that would be the cleanest way — cut the property tax increase and transfer $1.5 million from the reserve.”

The proposal passed 4-3, with Councilmembers Arthur Brun, Ross Kagawa, Derek Kawakami and Rapozo approving the measure.

Kaneshiro, along with Councilmembers Mason Chock and JoAnn Yukimura, voted against it.

“It’s so easy to say ‘we’ll take a little here and a little there,’ but you end up whittling away from the reserve,” Yukimura said.

In a separate proposal, also introduced by Rapozo, the $1.5 million difference will come from the reserve fund.

Brun said the council needs to seize the opportunity to use the reserve fund.

“We heard it from everyone —we don’t want to raise taxes. We have a chance not to do it.

“Yeah, it’s not good to take from the reserve, but there are tough times out there,” he said.

While Kaneshiro and Chock didn’t support the measure initially, they passed it as a compromise.

That measure need five votes to pass.

“If this doesn’t pass, we’ll revert to the original budget, and I’m not willing to go back to the drawing board,” Chock said.

In the end, that measure passed 6-1, with Yukimura the dissenting vote.

“I’m against this as a matter of principle,” she said.

“I think we need to protect the reserve.”

The mayor attended the meeting, and did not look happy with the council’s decision.

During the meeting, the council cut the auditor’s office and removed $100,000 to pay for performance audits.

Kawakami proposed de-funding the auditor’s office, to the tune of $504,000.

“This is an unintended consequence of when things get thrown out to charter amendments that sound like great ideas,” he said.

“Here’s an office that sounds great, but hasn’t been staffed for a while.

“This is a temporary cut that hopefully leads to broader discussion about whether we want to repeal the whole office,” said Kawakami.

“It’s going to be very expensive to fund this in perpetuity.”

That measure was withdrawn in favor of a measure proposed by Rapozo, who had the same idea.

The only difference was funding it for three months to allow for time to move out.

That would give the office $9,000 to work with to move, he said.

Yukimura said if the office isn’t budgeted, no one will apply for the job.

“Who’s going to want to take a job with no office or no salary?” she said. “We’re basically saying we’re abandoning the effort.”

The council voted 4-3 to approve Rapozo’s measure, with Yukimura, Chock and Kaneshiro voting against it.

Kaneshiro also proposed cutting $100,000 from the performance audit line item, leaving $275,000 for the county to pay for audits, which is part of the division of Council Services.

“If we’re going to cut from admin, we also need to look at our side.

“We can’t say we’re cutting from theirs and not looking at ours,” he said.

If there’s a good team, there’s no need for audits, said Kagawa.

“But the messups cause us to want to do audits,” he said. “We really don’t need the money if we start eliminating the mistakes that occur.”

Rapozo didn’t support the measure.

“I believe audits are critical,” he said. “At the end of the day, there’s no other way we can understand what needs to be done unless we can do audits.

“They aren’t cheap, and the audits I will be proposing are complex. I just want to have that pool available.”

The council voted 6-1 on the measure, with Rapozo the dissenting vote.

On Thursday, Carvalho presented the supplemental budget, which was submitted to the Kauai County Council on May 5.

The newest version of the budget reflected a $600,000 decrease, bringing the proposed operating budget down to $203.5 million.

As part of the supplemental budget, the mayor’s office allotted $150,000 to the Kauai Veterans Center to pay for repairs to the roof and $22,000 to purchase a new air conditioning unit for the Historic Waimea Theatre.

That item was kept in the budget.

The administration also included $30,000 to address irrigation needs at the Historic County Building, but that was cut.

The Office of Economic Development saw the most cuts, with $25,000 being cut to fund airport greeters, $30,000 from the Climate Action Plan and $10,000 from the Aloha Plus Challenge.

Those cuts were proposed by Rapozo, who said he wanted to see tangible benefits from those efforts.

During the meeting, Kagawa also proposed cutting $900,000 in overtime for the Kauai Police Department and cutting the assistant chief position for the Kauai Fire Department, which is a $159,000 position.

Both measures were denied.

Brun proposed cutting KPD overtime to $400,000.

“They can always transfer monies to make up for it,” he said.

The measure was approved 5-2, with Kawakami and Kaneshiro voting against it.

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