A little more than a week before the Honolulu Authority for Rapid Transportation takes office, a battle looms as Mayor Peter Carlisle is expected to veto the agency’s budget passed by the City Council.

In recent months, Carlisle’s administration and the City Council have debated whether the Council has authority over the budget of the agency, which begins July 1. A city spokeswoman could not confirm when Carlisle would veto the bill.

But Council Budget Chairman Ernie Martin, poised to become Council chairman, said the city managing director told him of the mayor’s intent to veto soon.

"If in fact the mayor does veto those bills, we would look at scheduling a special session to override his veto," said Martin, who expressed confidence in an override due to the bills’ 8-1 vote when they initially passed. It takes a two-thirds’ vote of the nine-member Council to override a veto.

Carlisle has indicated that he is prepared to sue the Council over the matter. At issue is whether a City Charter amendment, passed in last year’s election, intended to give the agency full authority over its finances.

The city Rapid Transit Division, currently part of the Transportation Services Department, will move under the authority of an executive director and a 10-member appointed board. The Council budgeted about $17.5 million for fiscal 2012.

Regardless of whether the issue goes to court, it should have no immediate impact on the authority’s operations, said Wayne Yoshioka, director of city transportation services.

If the Council overrides Carlisle’s veto, then the Council’s budget would be in effect. If a judge rules the Council doesn’t have the authority, the agency’s board would vote on its own budget, Yoshioka said.

"Eventually we’ll have to resolve this apparent discrepancy," Yoshioka said.