The Honolulu City Council has boosted funding to combat homelessness for the 2015 fiscal year to $47.2 million. That marks, council members say, a new high.
It remains to be seen whether city agencies will have the resources and time to administer all of the funds, Mayor Kirk Caldwell said at a press conference in his offices after the council approved the budget.
Funding for homelessness dominated budget discussions on Wednesday as City Council members passed a $2.1 billion operating budget and a $709 million capital improvement budget. Both go into effect in July.
The vote on the capital budget was unanimous, while it was 8-1 on the operating budget, with only Breene Harimoto voting against it because he felt there wasn’t enough discussion.
The finalization of the budget capped off three months of debate between the mayor and the City Council over the city’s homeless policy.
In the past five years, homelessness on Oahu has increased by 30 percent, according to a recent study by Honolulu’s Depart of Community Services.
The proposed budget Caldwell submitted to the City Council at the beginning of March included $18.9 million to house homeless people, with that money coming from the city’s Affordable Housing Fund, and $3 million for support services.
But the City Council ultimately slashed the mayor’s $18.9 million proposal to $12.2 million, while Caldwell mounted a campaign in recent weeks to restore the funding.
But in a last-minute twist, Council Chair Ernie Martin submitted budget amendments just days before this week’s vote to increase funding for homelessness by another $32 million — well above the mayor’s request.
To accomplish this, Martin proposed diverting an identical amount from Caldwell’s $140 million proposed road repavement program, which the mayor has made — along with homelessness — a top priority of his administration.
Councilman Ikaika Anderson unveiled a compromise proposal on Wednesday in the form of a new amendment that leaves the mayor’s road repavement program largely intact. The $32 million to tackle homelessness will come from the capital improvement budget.
Anderson hailed the increased funding as a win for the city’s most needy, the working homeless and homeless families. He also chastised the state for not doing more to address the housing problem, calling its $1.5 million appropriation for a Housing First program “truly an insult.”
Housing First, a program heavily promoted by the mayor, works to get chronically homeless people into housing before providing services such as mental health care and substance abuse treatment.
While council members were congratulating themselves Wednesday for their efforts to combat homelessness, Caldwell was getting ready for a press conference to express his views on the final budget, including concerns about the source of the extra funding that will be used to reduce homelessness.
The $32 million that has been added to the city’s capital improvement budget will be paid for with general obligation bonds. Caldwell told reporters in his offices at Honolulu Hale that this money would likely be paid back over a period of 20 years, bringing the overall cost to the city, with interest, to $54 million.
“I’m troubled and worried about our debt service, but at the same time, we need to address our low-income working families, our homeless families and our chronic homeless,” the mayor told reporters.
“We have now been put smack-dab back into the housing business with this $32 million.” —Mayor Kirk Caldwell
The capital improvement budget also comes with more constraints than the cash from the Affordable Housing Fund. Capital improvement project funds, known as CIP, can only be used by the city to build or renovate facilities, he said.
By contrast the affordable housing money allows the city to partner with private companies or nonprofits to purchase or renovate housing, manage properties and provide additional support services.
City agencies will now have to manage acquired properties and the City Council hasn’t allocated any additional funding for this purpose, said Caldwell.
“We have now been put smack-dab back into the housing business with this $32 million,” he said, something the city fought to get out of 20 years ago. “With no funding for administrative support, it is a real challenge.”
Still, the mayor said his administration would work to “spend every penny” of the funding.
“We will work as hard as humanely possible to make sure we are successful,” he said.
Overall, the mayor said he was pleased with the budget. That’s not surprising given that, thanks to Anderson’s proposal, there were no major cuts to the mayor’s road repavement program.
Caldwell still has $132 million in funding for roads, down from the $140 million he had initially inserted into the budget. The Council redirected the $8 million to other priorities.
Caldwell says he intends to sign off on both the operating and capital improvement budgets.
Other budget highlights include about $110 million for maintaining and improving parks, $270 million for sewer work required under a federal consent decree, $5 million for restoring bus routes and $450,000 to build public restrooms in Chinatown.
Another $500,000 is in the budget for energy efficiency measures, which will support the mayor’s plan to replace more than 50,000 city-owned street lights with LED fixtures, which are expected to reduce energy use by 40 percent.
The City Council also inserted about $40 million in additional projects into the budget for things like park repairs and an island-wide traffic signal optimization study; the sort of projects that are largely intended to serve individual member’s districts.
The mayor said he would review the projects on a case-by-case basis to see if they merit funding.
While the City Council has ultimate control over what ends up in the budget, and can cut into the mayor’s priorities, the mayor can refuse to release funding for members’ projects.
That may well be the case for the $5 million in funding that Martin inserted into the budget for the Grants-in-Aid program, which provides funds for non-profits.
Martin doubled the funding that was previously slated for the program.
Caldwell said he doesn’t plan to release the extra funding because it goes against the charter that created the Grants-in Aid program two years ago. City funds should, he said, not be used to “support different nonprofits on an earmark-basis.”
Martin boosted the funding because the committee reviewing the proposals failed to give money to a single arts and culture organization. He said such organizations should be funded, adding that the criteria used for judging the applications was flawed.
“We didn’t get everything we wanted, the Council didn’t get everything they wanted, and perhaps that is the best way that a budget process should work,” said Caldwell.