Facing possible cutbacks, council members polish off 2017 contingency funds

HILO — It’s use it or lose it time for the County Council.

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HILO — It’s use it or lose it time for the County Council.

Facing a possible cutback of contingency funds in next year’s budget, council members Wednesday polished off $73,060 for 19 projects as they rushed to meet the deadline to spend their 2017 largess.

The nine-member council received $810,000 this fiscal year, or $90,000 each. Council members can spend the money pretty much how they see fit, as long as it serves a public purpose and goes through a county department first. They lose the money if they don’t spend it by the end of the fiscal year on June 30.

“A lot of these we’re all supporting are identified needs,” said Kohala Councilman Tim Richards.

Wednesday’s grants included $18,300 for The Food Basket, $7,927 for a Hilo Bay July 4 fireworks display, $5,000 for a faith-based summit to end family homelessness, and $5,000 to spay and neuter feral cats.

The contingency funds are in addition to $1.5 million in grants to nonprofits that are awarded on a competitive basis.

Mayor Harry Kim, citing a tight budget, has proposed cutting the contingency funds in the next budget to zero. Faced with a $2 million or more cut in the county’s share of the transient accommodations tax and across-the-board increases in employee salaries and benefits, Kim has warned a “significant increase” in property taxes may be needed to balance the budget.

Deputy Finance Director Deanna Sako said Wednesday number-crunchers are working on balancing the budget while still unsure how much of the transient accommodations tax will come to the county, and with collective bargaining continuing on raises for police and other public workers. Kim’s final proposed budget is due Friday.

Sako said the council should expect to see “some or all” of the contingency funds restored in the next budget.

“We’re trying to balance it with all the needs of our budget,” Sako said. “We’re having to look at revenue increases.”

Council Chairwoman Valerie Poindexter wants more money for the council to distribute, not less. She said she asked the Finance Department to return council members to $100,000 each in contingency funds.

That will give council members some wiggle room when they begin amending Kim’s budget in the coming weeks. In their line-by-line scrutiny, council members must take money from one budget item in order to add to another, to keep the budget balanced.

Poindexter doesn’t see a conflict in increasing contingency funds even as the budget is so tight that property taxes need to be raised. In the overall scheme of a $474 million budget, $900,000 isn’t that much, she said.

“It’s not going to break the camel’s back,” she said.

The council contingency fund once totaled $2.7 million, giving each council member $300,000 to spend. Former Mayor Billy Kenoi zeroed out the fund for four years during the Great Recession, then brought it back at $100,000 in 2013.

Critics have in the past called the contingency fund a “slush fund” that’s used to help council members win re-election.

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Supporters say the district funds are a good way to ensure overlooked projects are funded. Additional checks and balances are in place by requiring both the department and council as a whole to approve each expenditure, they say.

“We’re the ones that are directly in touch with our communities,” said Puna Councilwoman Jen Ruggles.

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