Chair Waters proposes funding plan for Oahu sewer upgrades using accommodation tax

The Honolulu City Council is gearing up for critical budget discussions, with a special committee meeting scheduled for May 12 and a regular budget meeting on May 27. These sessions are crucial as the council prepares for the June 4 full council meeting, where key financial decisions will be made.

Chair Waters highlighted the pressing economic challenges facing families in Honolulu, noting rising costs in food, transportation, and utilities. In response, he proposed a significant shift in how the city allocates its Oahu Transit Accommodation Tax (OTAT) revenue. Currently, 50% of this tax, which is levied on visitors, funds the rail project. Waters suggested redirecting approximately $49 million from the OTAT to bolster the sewer fund, which could alleviate the need for issuing bonds and create savings for the city.

Waters' proposal includes a gradual increase in sewer fees over the next decade, starting at 6.75% for the first five years and tapering down to 5.5% by the end of the ten-year period. This approach aims to reduce the overall financial burden on ratepayers while incentivizing water conservation. For instance, a median family using 6,000 gallons per month could save $10 monthly compared to the administration's original proposal, while low water users could see savings of up to $18 per month.

The council is set to hear public testimony on these proposals, with community members encouraged to share their insights. As discussions continue, the council aims to balance fiscal responsibility with the needs of its residents, ensuring that any changes to the budget reflect the realities faced by families in Honolulu.