The Honolulu City Council approved a $2.3 billion operating budget for fiscal year 2017 Wednesday that includes millions of dollars for nonprofits and homelessness initiatives, and a separate rail budget that caps spending at a figure $1.3 billion short of what the federal government estimates the project may cost.

Still, the Council approved nearly $2.2 billion in operating and capital improvement expenditures for rail.

Council members capped spending for the project at $6.8 billion, which may force city officials to figure out alternatives to building the full 20-mile route, Councilwoman Ann Kobayashi said after the hearing. The board of the Honolulu Authority for Rapid Transportation is planning to meet next week to discuss options in light of a recent federal estimate that the rail project could cost as much as $8.1 billion.

Honolulu City Council member Brandon Elefante. 1 june 2016.
Councilman Brandon Elefante said more information should be released about how $95,000 for Council members and their offices is being spent. Cory Lum/Civil Beat

In addition to budgets for HART and the executive branch, Council members approved a $19 million budget for the legislative branch Wednesday despite concerns from Councilman Brandon Elefante that there’s not enough detail in the budget about how the money will be spent.

City lawmakers additionally green-lighted $940 million for capital improvement projects, including $1 million to acquire and preserve the Kanewai Spring in Hawaii Kai.

Elefante estimated that in total, the city budget provides about $12 million to nonprofits while stripping $6 million from city agencies.

Council members also agreed Wednesday to restore millions of dollars to fund sewer upgrades in Kalihi that the Budget Committee previously cut from Mayor Kirk Caldwell’s budget request.

But Caldwell didn’t get his wish to fund a new asset management division to help shepherd affordable housing developments.

Caldwell issued a statement Wednesday thanking the City Council for its work but expressing disappointment that the Council didn’t fund the new divisions and proposed improvements at Thomas Square park.

The mayor has 10 business days after he receives the budget bills to take action or they will become law without his signature.

Council Chair Ernie Martin, who is considering a run for mayor against Caldwell, said he estimates the budget sets aside as much as $20 million to address homelessness.

Honolulu has one of the highest per capita rates of homelessness in the nation, and budget proposals include $125,000 for a transitional housing program and $100,000 for homeless outreach services from Ewa Beach to Waipahu.

Missing from the budgets approved Wednesday was a proposal from Martin and Councilman Joey Manahan to support the expansion of New Hope Church. The council members suggested setting aside $250,000 earlier this year, but removed the appropriation in response to public outcry.

Millions In Handouts

Councilman Elefante, from Aiea, raised concerns about the millions of dollars set aside for nonprofit organizations.

Every year, a city commission reviews numerous applications and ranks them according to specific criteria to determine which organizations should receive about $6 million in Grants in Aid funds.

Lawmakers set aside an additional $2 million for organizations, including $250,000 each for the National Kidney Foundation of Hawaii and Pa’i Foundation.

Honolulu City Council member Ann Kobayashi. 1 june 2016
Honolulu City Councilwoman Ann Kobayashi, Budget Committee chair, said a shorter route for rail may be necessary. Cory Lum/Civil Beat

Scattered throughout the operating budget were set-asides for other nonprofits, including $500,000 for the Kosong Foundation to plan and develop a community cultural and arts center and $370,000 for Youthbuild Honolulu to prepare non-high school graduates for work.

Elefante estimated that in total the city budget provides about $12 million to nonprofits while stripping $6 million from city agencies.

But Martin argued during Wednesday’s hearing that the city’s Grants in Aid program is only a starting point for funding nonprofits.

“No core service is jeopardized by this particular budget,” Martin said. “It’s a balanced budget.”

Kobayashi also defended the practice, arguing that nonprofits do important work in the community and need the money.

Lack Of Transparency

Elefante said he was concerned that Martin declined to provide details of specific line items in the legislative budget.

Martin also didn’t share a detailed account of how nearly $100,000 allocated to City Council offices last year was spent.

During a recess in the day-long hearing Wednesday, Martin said the Council has never provided such information while he’s served on the legislative body, and that Elefante should have brought up his concerns during Budget Committee meetings earlier this year.

Honolulu City Council Chair Ernie Martin. 1 june 2016.
Council Chair Ernie Martin defended the budgeting process and said Elefante should have brought up his concerns sooner. Cory Lum/Civil Beat

Elefante has been seeking information since at least March 16, when he sent a letter to Martin asking for “line-item budget details for each budgeted activity in the legislative budget bill.”

The mayor’s office is required to provide such information for its requests and sent Council members a breakdown of its budget proposal in March.

Elefante said he also did not receive a detailed description of how the Council has spent about $95,000 in funding for Council members and their offices. Each member receives $20,000 and posts details about how that is spent online, but there’s no public accounting of the additional $95,000.

Martin sent Elefante a memo Wednesday morning with some of the information that he was seeking.

He wrote the $95,000 was used to “cover the cost of a range of various expenses” and listed several examples, including the leis and wreaths, the cost of sending an unnamed Council member to sister cities and “mediation/facilitating services.”

Oahu resident Natalie Iwasa testified during Wednesday’s meeting that she made a public records request to see the expenditures and waived a heavily redacted document from the podium.

“Why is this information not available?” she asked. “Why is it necessary for you to redact the amounts? Because this is your budget, the only oversight here besides yourselves is the public and the media. This to me is not acceptable. … It’s not right.”

Iwasa said after the hearing that it’s possible the information was redacted because it wasn’t relevant to her request but that there should still be greater public disclosure about how the money is spent.

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