Ozawa’s Voting Record: Pro-rail in a Pinch

Councilmember Ozawa is chair of the Honolulu City Council Committee on Budget and for about four months has been holding two resolutions that would authorize bonds to pay for rail. The Federal Transit Administration (FTA) has forced the issue by giving a 60-day deadline in a letter they released September 21.

By not putting these resolutions on the committee’s agenda, Ozawa has already cost taxpayers $300,000 – $600,000 in extra bond issuance costs, according to Nelson Koyanagi, Director of Budget and Fiscal Services. But let’s take a closer look at some of the other rail measures.

Bill 22 (2018), CD2, HART’s Capital Budget for Fiscal Year 2019

Earlier this year Ozawa used a sneaky tactic to try to authorize the use of city funds to pay for rail. In a floor draft of Bill 22, CD2, HART’s capital budget, Ozawa included a one-sentence proviso:

(g) Notwithstanding the provisions of Ordinance 07-001, City revenues may be used to pay for the debt service for the $44 million appropriated from the general improvement bond fund. (Emphasis added.)

During discussion on June 6, he stated he came up with “this solution,” because no one had any other suggestions. There had been no discussion of this option during prior meetings. Other councilmembers were therefore concerned that there hadn’t been adequate notice to the public, and the amendment did not pass.

By the way, Ozawa’s support of this proviso isn’t “adamant opposition to using property taxes to pay for rail construction” as he stated in a recent email.

Bill 42 (2017), CD1, Authorizing the Use of City Funds for Rail

In order to address the deadline given by the FTA, the Council recently held special meetings to discuss Bill 42. The bill would allow the use of city taxpayer funds, e.g., real property taxes, to be used to pay for rail. Ozawa voted “no,” but this was a safe vote for him, because Councilmember Ann Kobayashi was the only other no vote. The bill continues to move forward and will be up for final reading on October 30.

When the pressure is on, however, Ozawa pulls through for pro-rail groups, as evidenced by his votes on two measures in 2017.

Bill 34, (2017), CD1, Authorization to Issue Bonds Equal to HART’s Capital Budget

Bill 34 (2017) is the initial authorization to issue bonds to cover capital costs of rail. Ozawa voted “no” on second reading, then switched to “yes” at the final hearing, June 7, 2017. From the Honolulu StarAdvertiser:

City Councilman Trevor Ozawa represented the swing vote, switching from a “no” to a “yes” after he read a statement from the dais at Honolulu Hale.”

All bond issuances must be approved for specific dollar amounts after the general authorization is approved. In this case, Ozawa again shows his pro-rail position when voting on Resolution 17-173.

Resolution 17-173, Authorizing the Sale of $350,000,000 in Bonds to Finance Capital Costs for Rail

On July 12, 2017, Ozawa voted “yes” on Resolution 17-173, which was the authorization for HART’s first bond issuance. Councilmembers Fukunaga, Kobayashi and Martin voted “no.” Six votes are needed to approve bond issuance. Had Ozawa voted “no,” the resolution would not have passed.

Ozawa also does not act with fiscal prudence regarding HART’s budgets.

Bill 21 (2018), CD2, HART’s Operating Budget for Fiscal Year 2019

In testimony before the Honolulu City Council, I asked councilmembers to cut HART’s budget, especially public relations (PR). Ozawa initially cut two PR staff, but then he added them back for final reading. In addition, he gave them $44 million more to spend. Roy Amemiya, city managing director, expressed concerns about this, because it means the city will have less oversight of the $44 million.

Bills 17 and 18 (2015), HART’s Operating and Capital Budgets for Fiscal Year 2016

During the March 31, 2015, meeting of the Hawaii Kai Neighborhood Board, Ozawa stated he made cuts to the HART budget. The record shows, however, that he made no cuts.

According to the FTA, there’s still a $134 million shortfall in HART’s projected revenues. In addition, with a budget of only $848 million for the City Center Guideway and Stations from Middle Street to Ala Moana, it’s very likely that additional funding will be requested. Ozawa may vote “no” on rail measures prior to the election, but when the pressure is on and voters aren’t able to exert much influence, I’m sure we’ll see his pro-rail nature shine through.

Note:  This is a re-post from my site.

Advertisements

A Sneaky Way to Approve City Funds for Rail

 

Buried in a proposed amendment to the bill for HART’s capital improvement budget (Bill 22, CD2, FD1) is the statement:

 

“Notwithstanding the provisions of Ordinance 07-001, City revenues may be used to pay for the debt service for the $44 million appropriated from the general improvement bond fund.”

 

We were told no city funds would be used to pay for rail.  Last year, however, the state legislature passed Act 1, which prohibits the general excise tax surcharge from being used to pay HART’s administrative or marketing costs, including personnel costs.  By default, that means that the bulk of these costs will need to be paid by city funds. Councilmembers then started discussions on Bill 42, which added “city” to the list of funding sources for rail.  It was opposed by most testifiers, and no final decision was made on it.

 

The mayor put $44 million of HART administrative and marketing costs into the city capital improvement (CIP) budget for next fiscal year.  Several councilmembers decried this as bad policy but then merely moved those costs to HART’s CIP budget.  

 

When asked about the $44 million, HART representatives stated they had enough cash to pay it, but according to their cash flow projections, bonds would be floated and apparently used to pay a significant portion of it.  There was no additional discussion of how the $44 million would be funded.

 

We deserve an open discussion of how and when city funds will be used to pay for rail and what councilmembers’ plans are to cover the $44 million.

 

As a side note, it is also important to consider that no significant cuts to HART’s administrative or marketing costs have been made.

 

There is one final hearing on this bill Wednesday. I will be there to oppose this bill and the manner in which the amendment is being done. I encourage others to testify as well.  The agenda and instructions on providing testimony are available here.

 

HART Math – When 1 + 1 Doesn’t Equal 2

HART has provided the Honolulu City Council with financial information in response to questions raised about the rail project.  The information includes math errors and inconsistent numbers.

For example, project expenditures are $1,637, $1,581 or $1,512, depending on which report one looks at.  More examples are available in my testimony, here:  Testimony Bill 23 surcharge 11-9-15 special budget with att.

The council is holding a special budget committee meeting at 5:30 p.m. at Washington Middle School.  Please make your voice heard.  The agenda is available here:  Special Budget Meeting Agenda.

an