Mayor dreads Council leadership shuffle

Mayor Kirk Caldwell warned Monday that a new Honolulu City Council leadership team needs to be careful how it handles his plan to use bonds to help fund the city’s troubled, $9 billion rail project.

Caldwell introduced a budget package earlier this month that calls for $44 million in borrowed money to help make up a projected gap in rail construction funding. Those would be the first time city bonds were used to fund the rail, which has mostly been paid for with state and federal dollars.

Three of the five Council members who are part of the new leadership team announced Friday have said they either oppose or have strong concerns about using bond money to pay for rail construction. They are Ernie Martin, who is expected to be reinstalled as chairman after a 15-month absence, Ann Kobayashi and Trevor Ozawa.

The Federal Transit Administration, which has committed $1.55 billion to the project, demanded that the Honolulu Authority for Rapid Transportation submit a recovery plan to show how it will make up severe shortages in the rail construction project. HART has handed over the plan, but FTA officials have yet to respond whether it was acceptable.

The $44 million proposed to be used by Caldwell is part of that assurance, the mayor said Monday.

“It’s clear to me that the FTA is watching very carefully,” Caldwell said in an interview. “The job right now of the City and County of Honolulu is to provide certainty, and time is of the essence.”

It’s not clear what the FTA, which has threatened in the past to pull back funding, will do if there is uncertainty about the city’s commitment to cover the deficit. HART so far has received about half of the $1.55 billion.

Caldwell said major construction projects of any governmental entity are typically funded through bonds.

The 2006 funding plan for the rail project mentions using federal and state money but not city dollars. The Council is currently pondering Bill 42 (2017), which would allow for the use of city funds for rail. The bill was deferred by Council members earlier this month and recommitted to the Council Budget Committee.

If the Council chooses to nix the use of bond money, it will need to make deep cuts in next year’s budget, increase taxes or both, the administration has warned.

The mayor said it would be “extremely difficult” to find $44 million in savings. “Let’s put it this way,” Caldwell said, “there would be pain in many different places.”

Caldwell said he’s been told not to expect a response from the FTA until July.

The plan to use bonds for rail was backed by current Council Chairman Ron Menor, Transportation Chairman Brandon Elefante and Planning Chairman Ikaika Anderson, who all met with FTA officials in Washington, D.C., last week.

None of those three, however, are part of Martin’s new leadership team.

A Martin-led Council is expected to be more hostile to Caldwell and his policies.

Meanwhile Council Budget Chairman Joey Manahan canceled budget briefings Monday due to the lack of a quorum, and Menor said he was scrapping the entire week of scheduled budget meetings, citing what he described as “pending organizational issues” at the Council.

A special Council meeting has been scheduled for Monday where members will take up the resolution installing Martin as chairman. To hold briefings before then would be counterproductive, Menor said.

A new group of Council leaders, if there is to be one, might have “different views and priorities on the provisions in the city budget,” Menor said. It would be prudent to postpone budget briefings until after the special Council meeting, he said.

Canceling this week’s slate of briefings pushes the budget process back at least two weeks because committee meetings are scheduled to take place March 20-22.

It’s unclear whether even those meetings will take place since committee rosters will likely be shuffled after Monday’s meeting. Currently, the most powerful committees are led by Manahan (Budget), Kymberly Pine (Zoning and Housing), Anderson (Planning), Elefante (Transportation) and Menor (Executive Matters and Legal Affairs). Of the five, only Pine is part of the new leadership group.

Besides Martin and Pine, Carol Fukunaga, Ann Kobayashi and Trevor Ozawa are backing the reorganization.

In a separate statement, Menor said if he is to lose the chairman’s post, he’s proud of the work his leadership team accomplished in 13 months.

“There was greater collaboration, a more low-key, less adversarial style in our deliberations, with a marked reduction in political posturing,” he said.