Maui Council passes fiscal 2026 budget on first reading; final reading set for June 3

The Maui County Council gave initial approval to its version of the fiscal 2026 budget Friday, retaining full $12 million funding for Maui United Way’s Countywide ALICE Initiative: Kamaʻāina Credit program.

Council Chair Alice Lee told the Hawaiʻi Journalism Initiative that she planned to seek a $2 million cut to the ALICE initiative, noting that it needed at least $10 million for that program.

On Friday, Maui United Way President and Chief Executive Officer Jason Economou asked council members not to cut $2 million from the program to help people, especially wildfire survivors, with basic needs such as rent, utilities and groceries.

Economou acknowledged council members were under pressure to cut their budget, and that $12 million for the Maui United Way program was a “big number.”

However, “don’t cut money from this,” he said. “If you’re gonna make cuts in the budget, I understand that pressure, but cutting funding to a program that is going to serve our working-class residents who are most vulnerable to having to relocate, to having to leave behind the islands that they and their families have called home for so long. That’s not the area to cut.”

Ultimately, council members decided to keep the $12 million for Maui United Way untouched.

Council Member Keani Rawlins-Fernandez acknowledged “how important that is to help our community right now, especially with the (Federal Emergency Management Agency) cliff, and the way things are at the moment.”

However, council members agreed to Lee’s proposed cut of $500,000 from the Office of Recovery.

On that point, Rawlins-Fernandez said she understood that that funding was “a more of a broad category to cover some of the wildfire expenditures, and that the administration was okay with that item being reduced by $500,000.”

Her comments about proposed reductions came as part of several hours during which council members wrestled with numerous budget amendments on the Council floor. Some were aimed at reducing the size of the Budget, Finance and Economic Development Committee’s recommendation for a $1.56 billion budget. That spending plan added $55.4 million, or nearly 3.7% more than Mayor Richard Bissen’s proposed budget of $1.51 billion.

The committee report on the budget bill is available here.

It will take awhile to assess the impacts of Friday’s floor amendments, which included some reductions from earlier proposed real property tax rates. Because of those changes, the Council will hold another public hearing on tax rates at 9 a.m. May 27 in the eighth floor Council Chambers of the Kalana O Maui Building. The agenda details the revised tax rates.

Set at a rate of $1,000 per net taxable assessed valuation, the proposed tax rates include:

• Owner-occupied homes, $1.65 for properties up to $1,300,000 million (tier 1), $1.80 for homes valued from $1,300,001 to $4,500,000 (tier 2), and $5.75 for those valued more than $4,500,000 (tier 3).
• Non-owner-occupied homes, $5.87 for up to $1,000,000 (tier 1), $8.60 for $1,000,001 to $3,000,000 (tier 2), and $17 for those more than $3,000,000.
• Apartments, $3.50.
• Hotel/resort, $11.50 (down 20 cents from the earlier Council proposal).
• Time share, $14.70 (down from $16.60).
• Transient vacation rentals, from $12.50 to $15.55 (top level down from $16.50), depending on the valuation.
• Long-term rentals, $2.95 from $8.50 (top level down from $10), depending on the valuation.
• Commercial, $6.05.

Council members received numerous written testimonies, many of which opposed real property tax increases.

In other action, council members tabled Bill 49. That measure calls for a 30% pay raise for most positions in the Office of Council Services. It would affect 31 positions and cost about $835,000 annually.

Lee remarked that she could see there was no majority ready to pass it, so she tabled it without objections.

On other salary-related measures, council members approved resolutions for negotiated “cost items” for five Maui County employee bargaining units.

Council Member Tamara Paltin, a former lifeguard with the County, said she thought the Hawaiʻi Government Employee Association did “a horrible job” negotiating the pay raises for her former bargaining unit 3.

“I don’t feel like they’re paid a living wage for what the expenses are to live on Maui,” she said.

She cautioned that, unless pay gets more competitive, “there won’t be people to work these jobs.”

In a separate matter, council members voted 5-2, with Council Members Tom Cook and Yuki Lei Sugimura dissenting, to approve a resolution to forward a draft bill to the Maui Planning Commission and the Board of Water Supply regarding interim restrictions on private swimming pools in West Maui. Introduced by Paltin, the measure would impose interim restrictions on swimming pools in the arid West Maui community plan region through Dec. 31, 2028.

Because of water evaporation, the water consumption of 10 pools equals the usage of one home, she said. “Right now is the time we’re getting a handle on our water usage and needs,” Paltin said. “And so I think it’s right to impose interim restrictions.”

She noted that there are a number of exemptions, including the repair and maintenance of existing pools.

Cook said he couldn’t support the measure because “I don’t agree with the interpretation of the impact.”

“I understand the challenges of West Maui, and I’m supportive of conservation, developing source, etcetera,” he said. “But my math and calculations and experience with swimming pools don’t add up too much volume.”

“I wouldn’t want to see everybody going to the beach to jump in the ocean,” Cook added. “It’s a nice idea, but we don’t need the coastline that crowded.”

Also, council members passed on second-and-final reading Bill 57, introduced by Rawlins-Fernandez. It would help residents — first on Molokaʻi — afford housing by offering county funding with legally binding deed restriction conditions that ensure publicly subsidized homeownership remains in local hands. The bill adds a deed restriction option to the Homeowners Programs Revolving Fund, administered by the Department of Housing.

Council members approved a resolution to authorize the County’s purchase — for an amount up to $7.2 million — of two acres at 220 Lalo St. in Kahului. The property is being eyed as a possible baseyard in Central Maui for the Department of Public Works Highways Division.

Second-and-final reading of the budget is set for June 3. Under the charter, the Council has until June 10 to pass the budget, which goes into effect July 1.