In a series of 5-4 votes, several of Mayor Kirk Caldwell’s proposals to increase taxes and fees won preliminary approval Wednesday from the Honolulu City Council.

Caldwell’s proposed operating budget also moved forward. Adoption of the final budget will likely occur in late June.

Council members Carol Fukunaga, Ann Kobayashi, Ernie Martin and Trevor Ozawa all voted against proposed increases to the vehicle weight tax and parking meter fees, but the measures passed.

It was the same story for increases in admission fees for the Honolulu Zoo and green fees for municipal golf courses, as well as Bill 28, which would increase fees for TheBus and TheHandi-Van.

Council members approved increases in fares for riding TheBus.

Paratransit riders, some blind or otherwise disabled, and some members of Citizens for a Fair ADA Ride testified against Bill 28. If it gains final approval, it would increase the $2-per-trip fee for TheHandi-Van by 50 cents per year until it reaches $4.

“A lot of Handi-Van riders are on a fixed income,” Lori Tanigawa testified.

Councilwoman Kymberly Pine suggested the council come up with a tiered system to charge Handi-Van users according to their income.

Martin said he wants to make The Handi-Van service fully subsidized. It’s currently 95 percent subsidized, according to Wes Frysztacki, director of the Department of Transportation Services.

The bill would increase fares for TheBus from $60 for a monthly pass to $80 by 2019. The cost of a single ride would increase from $2.50 to $3.25.

Windward Oahu resident Casey Connors recommended the city evaluate bus routes to increase efficiency and advertise TheBus to tourists to increase ridership.

Fukunaga, Martin and Ozawa also voted against this year’s resolution to set property tax rates.

Hawaii Lodging and Tourism Association, The Waikiki Improvement Association, and other organizations representing the tourism industry also voiced their opposition to the rates.

Resolution 17-70 would increase the property tax rates for hotels and resorts from $12.90 to $13.40 per $1,000 of assessed value.

The last hotel and resort property tax rate increase occurred in 2015, when rates increased from $12.40 to $12.90.

Rates for some Residential A property owners would go up if the resolution gets final approval. The property tax class is made up of non-owner occupied homes worth $1 million or more.

Max Sword, vice president of industry affairs for Outrigger Hotels and Resorts, said the proposed hikes are unfair to the hotel industry.

“We think it’s kind of unfair that we’re being singled out,” Sword said.

He’s is also the Honolulu Police Commission chairman.

Rick Egged, president of the Waikiki Improvement Association, recommended the city tax transient accommodations, including Airbnb units, rather than hotels to generate revenue. Egged estimated there are at least 4,000 units in Waikiki and 4,000-6,000 more throughout the island.

The resolution passed the council on a 6-3 vote after Ozawa and Martin cited concerns about the welfare of the tourism industry.

“I’m not just voting no to vote no. I’ve proposed a number of cuts to the operating budget,” Ozawa said. “I’m unable to go forward with increases if my decreases are not considered.”

Ozawa and Martin both proposed a slew of cuts to this year’s proposed executive operating budget, but the Budget Committee deferred almost all of them at an April 11 meeting.

Waiting For Rail

All nine council members supported the proposed legislative budget for the upcoming fiscal year. It passed with little discussion.

Caldwell’s proposed operating budget didn’t make it past the council quite so smoothly.

Budget Committee members Pine and Ikaika Anderson said the entire budget would need to be reconsidered once the Legislature decides how much additional money the city will get for its $10 billion rail project.  

The Legislature has until Friday to decide how long it will extend the Oahu-only half-percent surcharge on the state general excise tax, which funds rail construction along with federal grants.

“Once we know where we are at that point,” Anderson said, “we will be starting the budget essentially from scratch.”

HART Rail Salt Lake Boulevard Aloha Stadium2. Near Kamehameha Hwy. 23 feb 2017
Finding funds to complete the 20-mile rail project is a crucial aspect to creating the city’s budget for the coming fiscal year. Cory Lum/Civil Beat

Other council members complained the mayor’s proposed $2.45 billion operating budget needed more work.

“If I was on the executive branch, I would be ecstatic,” Martin said. He said the budget looks too much like it did when the mayor originally proposed it.

Martin’s proposed cuts to the budget amounted to $32 million, though few made it past the Budget Committee.  

He said the Legislature needs to know the city is willing to make sacrifices to fund rail.

While the city can’t currently use its own funds for rail construction, the mayor proposed a bill earlier this month to change that rule.

Ozawa’s own proposed cuts totaled $41 million, but like Martin’s, few made it through the Budget Committee.

“We don’t want to be viewed as a rubber stamp here,” Ozawa said. “But it’s certainly looking that way in these iterations of the budget.”

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