Maui County Budget, Finance, and Economic Development Committee Meeting - March 25, 2026

The Budget, Finance, and Economic Development (BFED) Committee of the Maui County Council met on March 25, 2026, at 12:35 p.m. in a hybrid format to receive an economic outlook presentation, discuss grant administration and management, and review the proposed FY27 budget calendar and procedures. The meeting adjourned at 3:39 p.m. No consent calendar was presented.

Public Comments & Testimony

• On Economic Outlook: One testifier spoke, offering general remarks on the presentation and expressing frustration with state processes (e.g., lack of Hawaiian language translations). No other testifiers.
• On the FY27 Budget: One testifier advocated for increased funding for the Office of Council Services (OCS) and its translation staff. No other testifiers.

Discussion Items

• Economic Outlook (UHERO Presentation): Dr. Carl Bonham, Executive Director of the University of Hawaii Economic Research Organization (UHERO), presented the latest economic forecast. Key points:

  • 87% of visitors to Maui are from the U.S., making the county highly vulnerable to a U.S. economic downturn.
  • The U.S. labor market has stalled, with near-zero job growth in early 2026; the Iran war and oil price shocks add further uncertainty.
  • Maui's visitor spending is supported by high-end visitors, but the rest of the economy (especially federal civilian jobs) has seen significant losses: federal jobs are 13% below pre-wildfire levels.
  • Construction and healthcare are bright spots, but overall non-farm payrolls remain 2.5% below July 2023 (about 1,800 fewer jobs).
  • UHERO's analysis of Bill 9 (short-term vacation rental phase-out) estimates a gradual loss of visitor spending over several years, with a 23% drop in median condo prices already observed in 2025. The full phase-out would eventually lead to a $900 million loss in visitor spending and 1,800 lost jobs.
  • The "price of paradise" gap (cost-of-living-adjusted income) has widened to about $25,000 per person compared to the U.S. average.
  • Dr. Bonham answered questions on diversification, regulatory burdens, tariffs, and the need for long-term structural changes.

• Grant Administration and Management: Councilmember Johnson presented results of a survey of 28 respondents representing over 90 grants. Key findings:

  • 78% of respondents reported the timely disbursement of funds as the most challenging aspect; 53.6% cited reporting requirements.
  • 57% of respondents did not believe that county decisions were made for personal reasons, but 43% remained uncertain or concerned.
  • Average wait times: 6 months from application to award notification, 5.3 months from award to contract execution, 4.7 months to receive first advance, and 4.6 months for reimbursement after submitting a request. Total average processing time: 20 months.
  • Respondents requested a centralized electronic portal, clearer guidelines, and a cultural shift toward viewing nonprofits as trusted partners.
  • Administration (Budget Director Milner, Chief of Staff Lalo) outlined plans for a new Grants Division under the Mayor's Office for FY27, which will centralize small grants (under $25,000) and provide countywide coordination, professional development, and a grants network. A checklist distinguishing grants from contracts was shared, and the administration is working on administrative rules and code amendments.
  • It was noted that the county manages at least 257 grants in the FY26 budget, with OED alone handling about 150 open grants.

• FY27 Budget Process and Calendar: The committee reviewed the proposed budget calendar, real property tax rate proposal deadlines, and procedures. Key elements:

  • Real property tax rate proposals are due March 31, 2026, at 4:30 p.m. A draft resolution using FY26 rates as a baseline with ranges of 75% to 150% was distributed.
  • Department review schedules, residency area meetings (starting April 1), and decision week (April 20-24) were outlined.
  • Council members were asked to offset any additions with cuts or alternative funding sources (e.g., increased fees). Some members expressed concerns about the offset requirement and requested clarification on how competing cuts would be allocated.
  • The administration will provide status reports on previous council conditions and priorities.

Key Outcomes

• Economic Outlook: No formal action taken; presentation received and committee members will follow up with written questions.
• Grant Administration: The committee deferred further discussion, acknowledging the administration's planned Grants Division and upcoming administrative rules. The checklist on grants vs. contracts will be posted under both BFED items for clarity.
• Budget Process: The committee approved the revised budget calendar as presented. Council members are to submit real property tax rate proposals by March 31, 2026. The next BFED meeting is scheduled for April 1, 2026, at 9:00 a.m. to begin deliberations.