Mayor Kirk Caldwell returned the 2014 operating and capital improvements budgets to the City Council on Friday without his signature, objecting to several changes made by Council members that hamper his ability to quickly fill critical job openings.
By neither signing nor vetoing Bill 11 (2013) or Bill 12 (2013), the $2.16 billion operating budget and $635 million capital improvements package will take effect July 1.
Caldwell said he contemplated vetoing the bills, "but at the end of the day, I believe that wouldn’t be in the best interest of the taxpayer," he told reporters at a news conference Friday.
Key among Caldwell’s concerns is a proviso restricting how the administration can use about $65 million in a so-called vacant and funded positions account. Caldwell said the administration needs to have the ability to maneuver money quickly to hire temporary workers through what are known as personal services contracts.
Clauses in the budget bar the administration from using the vacant-funded position account for that purpose, administration officials noted.
"This restriction could seriously impact the hiring of temporary personnel who are needed to support the critical city operations while vacancies are being filled, such as for the hiring of part-time lifeguards, personnel to staff satellite city halls and personnel to support our public safety agencies," Caldwell said in his letter to the Council.
Council Budget Chairwoman Ann Kobayashi said the administration is free to hire people on personal services contracts, so long as money is transferred from an account for permanent employees into a separate fundfor temporary employees and other job purposesand the Council is notified every quarter of all such transfers.
"All they have to do now is be more accountable because when they move that money, they have to report to us and tell us where they are moving the money," Kobayashi said.
But corporation counsel and Council attorneys have different takes on the issue. Kobayashi said transfers from the one account into the other require only a notification to the Council. "I don’t think there’s an approval process; they’re just supposed to report" the transfers, Kobayashi said.
Administration officials, however, said notification implies the need for Council approval for such transfers.
Such a process would be "bureaucratic and burdensome" and make it difficult for the administration to respond to the needs of its agencies, Caldwell said, adding that the Council already made the situation more difficult by eliminating half the amount he originally put in for vacant-funded positions.
Much of the vacant-funded money will be used to pay for anticipated increases in collective bargaining contracts, "and therefore what’s left may not be sufficient to fund these positions." The administration has already sent letters to some people with personal services contracts warning them that their contracts might not be renewed.
Caldwell’s letter to the Council also raised objections to provisions in the two bills that appear to try to exert Council authority over the semiautonomous Honolulu Authority for Rapid Transit, which oversees the city’s $5.26 billion rail project.
City voters approved a City Charter amendment establishing HART because "they wanted to take politics out of the decision-making process while the rail project was being built," the mayor said. Consequently, Caldwell also did not sign three bills related to the HART budget, allowing them to become law.
Separately, the mayor raised concerns about restrictions on the use of $7.1 million in the operating budget earmarked for the Department of Environmental Services refuse collection and disposal program, as well as the Council’s deletion of $750,000 for construction of the Hauula Fire Station.
A major clash between Caldwell and Council leaders during budget deliberations involved $7.9 million in grants Council members earmarked to specific nonprofit organizations, a move he said flew in the face of a Charter amendment that established a standardized application process for cash-strapped nonprofits to receive funding from the city.
The administration has sent letters to those who would benefit from those earmarks warning them they might not get funding. Caldwell said Friday that decisions on those earmarks likely will be made on a "case-by-case basis."
