Two late votes by the Honolulu City Council Wednesday evening finalized approval of a $5.19 billion budget package for the city’s 2026 fiscal year, which begins July 1.
The Council unanimously adopted a $3.91 billion executive operating budget, which in general will fund city salaries, police and fire services and street and parks maintenance. The panel also fully passed a $1.28 billion capital improvement program budget meant to pay for infrastructure
improvements.
The Council-approved budget is a 10.4% increase over Honolulu’s current
$4.7 billion budget, which expires June 30.
Mayor Rick Blangiardi has within 10 days to sign the budget bills into law.
The latest budget includes $1.5 million toward new ambulances and six full-time equivalent positions to improve emergency response times on Oahu, particularly in Maunawili, Ko Olina, and Koolaupoko.
Council additions also
include $500,000 in traffic safety upgrades near school zones, and $400,000 in community policing support for all eight Honolulu Police Department districts, among other funding.
And under the finalized CIP budget, Council member Andria Tupola successfully added $1.7 million to pay for the long-awaited improvements to an unfinished Waianae Police Station at
85-939 Farrington Highway. “So we can finish the project,” she added.
But of note on the Council’s latest budget vote was the hours-long delay toward its approval.
Following back-and-forth discussions inside Honolulu Hale’s Council Chambers Wednesday, the panel took
a meeting recess after 5 p.m. The Council’s final votes cast came after 9 p.m., in
a meeting that began over 12 hours earlier.
“The extended recesses were required to carefully review and reconcile the Council member’s changes in the draft legislation on the floor,” a Council spokesperson told the Honolulu Star-
Advertiser Thursday.
On Wednesday, changes arose after Council Chair Tommy Waters’ introduced a new floor draft of Bill 22 — the executive operating
budget — that morning.
In that bill, Waters looked to redirect up to $19.1 million in previously appropriated but unused, or “lapsed,” city departmental funds to bolster the city’s sewer fund, as a way to defray the cost of anticipated multiyear sewer fee rate increases expected to start July 1.
“We have established a provisional account with the general fund to allow the sewer fund to access it as a contingency when needed,” Waters said. “If the funds go unused for sewer activities they will lapse back into the general fund.”
But city staff balked.
“We were kind of confused and surprised this morning when we saw the posted (floor draft) by yourself, Chair Waters,” city Department of Budget and Fiscal Services Director Andy Kawano said at the meeting.
He added, “It doesn’t make sense to take funding out of departments for salaries and current expenses and set aside in a provisional for sewer activities when we, in fact, should not use it.”
Kawano stated such an action could harm the city’s AA+ bond rating — the city’s creditworthiness that impacts its ability to do bond financing — as the city tackles federally mandated,
multibillion-dollar upgrades to its sewer treatment infrastructure and related
utilities.
Waters’ floor draft — opposed by city staffers and questioned by Council members — later evaporated.
Waters’ attempt to add general funds mirrored his introduction of Bill 43 last month — a measure which was ultimately postponed during a recent meeting of the Council’s Executive Management committee.
On May 5, Waters advanced Bill 43, meant to redirect a portion of the 3% visitor-generated Oahu transient accommodations tax, which in part is earmarked for Honolulu’s rail project,
to the city’s sewer fund.
But the chief critic of
Waters’ measure — BFS Director Kawano — asserted such an action was not a feasible option for the city to pursue.
“This measure will negatively impact the city’s general fund and deviate from the intended purpose of the TAT, which is to provide general fund capacity to fund city services; mitigate the strain visitors place on public facilities, emergency services, and natural resources; and provide additional funding for rail (i.e., ‘Skyline’) construction,” Kawano wrote in a May 12 letter to Council.
In related business Wednesday, the Council on
a split vote adopted its version of city-initiated Bill 60, which deals with anticipated increases to the city’s sewer fee rates.
As part of the budget process, the Blangiardi administration proposed a 10-year, 115% sewer fee rate increase that’s expected to begin this summer.
City officials say sewer fee hikes are necessary to support the city Department of Environmental Services’ ongoing wastewater operations and maintenance efforts, as well as a $10.1 billion capital improvement program for Oahu’s wastewater collection and treatment system that’s planned through 2040.
And they assert the work includes a $2.5 billion upgrade to the Sand Island Wastewater Treatment Plant as required under a 2010 federal consent decree.
On Wednesday, the Council voted 5-4 — with Esther Kia‘aina, Scott Nishimoto, Tupola and Waters dissenting — on Budget Committee Chair Tyler Dos Santos-Tam’s draft of Bill 60, which shaves the city’s decade-long span for increased rates down to about six years.
That plan would start
Jan. 1, 2026, and run through 2031.
As approved, Bill 60’s sewer fee increases for a household that uses about 6,000 gallons of water per month — deemed 50% of all single-family households in Honolulu — equates to a 6% increase in sewer fees in fiscal year 2026, 7.5% in fiscal year 2027, 8.5% in fiscal year 2028, followed by 9% over the remaining three fiscal years.
After the year 2031, sewer rates would increase 3%
annually.
As proposed, a household that uses 6,000 gallons a month is currently charged $99.77 on average. By year 2031, that average bill would rise to $160.85, a more than 61% increase, ENV data
indicates.
Under Dos Santos-Tam’s Bill 60, ENV will have authority to set up a program called Customer Assistance for Residential Environmental Services, or CARES, to help with “affordability and equity” of increased sewer fee rates.
Sewer customers who qualify based on household income of less than 80% area median income will be eligible for a $20 to $25 credit on their monthly base fee.
The program will be funded at $10 million per year. Customers will have to apply for the program to prove eligibility and then be re-verified every six months, ENV states.
Still, not all were happy with Bill 60’s approval.
“Really listen to your constituents because we’re
going to feel the effects,” Oahu resident Tara Rojas said with disappointment, during remote public testimony to the Council. “And this is only sewer (fees), not even including anything else.”
