Posted on: Sunday, May 4, 2003

EDITORIAL
Economic development belongs in city budget

In its efforts to pull the new (2004) Honolulu city budget a little more under control, the City Council has proposed slightly under $2 million in cuts out of an operating budget of well over $800 million.

That's not much and surely far short of what would be needed to balance the budget as required by law. Mayor Harris says close to $50 million in new taxes and fees will be needed to fully pay for his bare-bones budget.

Since the proposed cuts are not enough to balance the budget in and of themselves, they must be considered on their own merits.

The Harris administration, naturally enough, argues the cuts are harmful and unnecessary. For instance, the council cut $115,000 out of some $231,700 requested for vehicle parts and accessories. Sensible enough, except not all parts for specialized city equipment are available at the local parts store. If they have to be ordered and shipped in, the cost of keeping equipment off the road could exceed the small savings involved.

Well, there are many such conversations the council and the administration should be having. But rather than specify down to the line item where cuts should come, the council would be better off focusing on larger issues of budget policy.

Should the city be in the business (just for example) of operating swimming pools or providing summer fun programs? These are policy issues that, once decided, have substantial impact on the city budget.

If as a matter of policy the council believes that $2 million should be trimmed, it would be better off leaving the details to the administrators.

One policy area where the council did strike hard was in the area of economic development. The proposed budget for this office for 2004 was around $800,000; the Council cut that back to just under $300,000.

In our view, these cuts are short-sighted. Yes, the state (and private industry) also do economic development activities, but there are areas where the city is particularly well-situated to market and develop.

The Sunset on the Beach events, for instance, draw throngs of local residents and tourists, where they enjoy the movies and entertainment, but also spend money and become familiar with vendors, restaurants and the like. They represent an exciting new addition to the Waikiki "product."

Over time, private industry should certainly pick up a greater share of the financial load from these activities. But until that time the city should have enough money to keep this program healthy.

When you consider the economic development budgets of major Mainland cities or even Neighbor Island counties (Maui's is around $5 million), this is a modest request that should be fully supported.