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MAYOR APPROVES PRUDENT NEW CITY BUDGETS

            Mayor Mufi Hannemann today signed into law the administration’s Fiscal Year 2009 operating and capital budgets, which strongly emphasize public health and safety, fiscal discipline and saving money for long-term obligations.

“As in previous years, the Fiscal Year 2009 budgets place a premium on financial prudence and accountability, with a steadfast commitment to basic City services like public safety, sewers and solid waste, parks and public facilities, and transportation,” said Hannemann, echoing the theme of his previous budgets. “These budgets provide a combination of new proposals, such as beefing up security in our parks and beginning planning for the rail transit system, with the tried-and-true priorities of catching up on our backlog of sewer and road work and properly maintaining public facilities.”

For fiscal year 2009, the executive operating budget is $1.81 billion and the capital improvement budget is $954.8 million. The budgets include $340 million for sewer and trash disposal programs and $77 million for rehabilitation of major roads to battle the long-neglected and deteriorating roadways on Oahu.

It should be noted that Mayor Hannemann did not request any increases in tax rates or fees to support these budgets, which the City Council approved on June 4. Mindful of recent increases in real property values, the administration also budgeted for a $100 real property tax credit for qualifying homeowners.

The operating budget is impacted by non-controllable costs, such as debt service and pension and health requirements, as well as arbitrated pay raises. Excluding these factors, the FY 2009 operating budget for executive agency operations represents a 4.8 percent increase over the previous fiscal year. The budget appropriates $91.9 million for other post-employment benefits, specifically the City’s long-term obligations to fund health insurance for retirees.

“‘Other post-employment benefits’ is a term that may not be familiar to the general public, but which is becoming a nagging concern of state and local governments across the nation,” Mayor Hannemann said. “Simply put, governments must now account for their long-term obligations to retirees on their financial statements. Unlike the state government, Honolulu and our Neighbor Island counties have begun setting aside money for this long-term requirement. It’s the responsible thing to do because we can’t in good conscience leave a costly obligation for future generations to pay. It’s only prudent that we save as much as we can, rather than spend everything as we go.”

Hannemann is also adding another $7.5 million to the City’s Fiscal Stability Reserve Fund, a rainy day fund the City can draw upon for emergencies like economic crises or natural disasters.

“We were the first in the state to have our bond rating upgraded because of our policies of fiscal discipline and spending money on core City services,” the mayor noted. “Our budgets reflect our adherence to those policies.”

Budget highlights include:

General Government

·         $11 million for energy conservation improvement/solar energy initiative;

·         $7.4 million for National Pollutant Discharge Elimination System modifications for city corporation yards;

·         $20.1 million for the procurement of major equipment;

·         $13.35 million for an energy reserve to offset increases in fuel and energy costs and to mitigate any impact on operations;

Sewers and Solid Waste

·         $245.3 million for sewer rehabilitation and sanitation-related projects;

·         $8 million to expand curbside recycling;

·         $2.5 million for the third year of the Leeward Coast Community Benefits package, which offsets the burden of the Waimanalo Gulch Landfill on residents of that area of Oahu.  The money is split between grants to service providers and parks improvements;

·         $40 million for the solid-waste-to-energy facility (H-POWER);

·         $44 million for the solid waste to energy facility purchase;

Roads

·         $77 million for rehabilitation of major roads;

·         $3.4 million for road repairs using City crews;

·         $6.4 million to rehabilitate and complete seismic retrofits of bridges;

·         $5.2 million to inspect and plan improvements to potential rock-slide areas;

Transportation

·         $265.1 million to plan, design, and begin construction of the fixed guideway linking Kapolei with downtown Honolulu (includes $14 million in federal funds);

·         $31.1 million to purchase 50 hybrid buses (includes $24.8 million in federal funds);

·         $5 million to construct the Alapai Transit Center and $350,000 to plan the Windward Transit Center;

·         $4.2 million to construct the Middle Street Intermodal Center;

·         $6.7 million to design the Alapai Transportation Management Center;

·         $4 million to continue operation of TheBoat, the commuter ferry linking West Oahu with downtown Honolulu;

·         $1 million for bikeway improvements and funding for one new engineer position to oversee the City’s plans to provide more bikeways and bike routes;

·         $5.1 million for a traffic signal maintenance facility;

Public Safety

·         $63,000 to form a parks patrol of officers from the Honolulu Police Department, working in cooperation with the parks staff.;

·         Six positions to bolster the police department’s recruitment and training efforts;

·         $5.5 million for 58 replacement patrol cars, 10 motorcycles, one helicopter, and other equipment for the Honolulu Police Department;

·         $2 million for major improvements to police stations and other facilities;

·         $4.4 million for three fire engines, two ladder trucks, and other equipment for the Honolulu Fire Department;

·         $2 million for major capital improvements to fire houses and facilities;

·         $1.2 million (from the operating budget) for repairs to fire houses and $800,000 for general repairs to other City facilities;

·         $1.19 million to plan and design a new East Kapolei fire station;

·         $7.3 million for the Ewa Beach Fire Station relocation;

·         $200,000 for additional Windward community policing;

Housing and Sustainability

·         $4 million to acquire land in the Honouliuli Preserve and Puuiki Beach in Waialua using money from the Clean Water and Natural Lands Fund;

·         $3.8 million to renovate the Kulana Nani affordable rental housing project in Kaneohe and $3.5 million from the Affordable Housing Fund to acquire the fee interest in the land;

·         $2 million to develop the River Street Residences in Chinatown, a transitional shelter for families and individuals, including those with disabilities;

·         $1.1 million for a new federally funded tenant-based rental assistance program, similar to the Section 8 rental vouchers (includes three positions and $960,000 in rental subsidies);

·         $305,000 for the Honolulu Sustainability Center project, which will demonstrate the benefits of new technologies such as rooftop photovoltaic, green roofs, recycling, and other sustainable systems to help reshape urban core structures;

Parks and Public Facilities

·         $15.9 million for parks improvements;

·         $8.5 million for Ewa Mahiko Park master planned improvements;

·         $6.9 million for the construction of the new elephant facility at Honolulu Zoo;

City Operations

·         $91.8 million for other post-employment benefits, primarily the City’s long-term obligations to the Employer-Union Health Benefits Trust Fund to pay for health insurance for retirees .  The administration set aside $40 million of this sum last year, but is now seeking authorization to begin paying the state government for this obligation;

·         $13.4 million for a provisional account to cover anticipated increases in the cost of fuel and electricity;

·         $7.5 million for the Fiscal Stability Reserve Fund, money for economic crises or natural disasters.

              Further information on the budget is available at: www.honolulu.gov/budget

Contact: Bill Brennan, 527-6928

 

Wednesday, June 18, 2008

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