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The financial impact of the August wildfires on Maui County’s annual budget this year may not be as bleak as officials had expected.

Last fall, Mayor Richard Bissen’s financial analysts said the devastation in Lahaina and Upcountry would likely contribute to a $31.2 million shortfall. His administration put forward an amended budget bill in September for the Maui County Council to consider that included across-the-board cuts to make up for the projected loss in revenue.

Bissen is now asking the council to scrap that plan after determining the county has roughly $24 million in unspent money across a patchwork of government programs.

Deputy Managing Director Josiah Nishita told the council’s on Tuesday that a recalculated revenue shortfall that accounts for the funding backlog would soon be available. In the meantime, the administration asked the council to rescind its previous budget bill amendment.

The leftover money in the fiscal 2023 general fund is in part the result of hiring challenges that have plagued the county since the start of the Covid-19 pandemic. All told, 17% of the county’s salary budget did not get spent due to how difficult it has been to fill vacant positions, according to Accounting System Administrator Marci Sato. 

Carryover savings also stem from new and unexpected revenues — the county’s new half-percent general excise tax surcharge and license and permitting fees totaled more than estimated last year.

All these gains will be balanced against any potential revenue losses from the county’s new tax-break program for owners of long-term rentals who elect to help with the housing needs of thousands of displaced people who survived the Aug. 8 wildfires.

The program exempts timeshare units, nonowner-occupied dwellings and vacation rentals from up to $200,000 in property taxes if they rent for at least 12 months to tenants who lost their homes in the Lahaina or Upcountry Maui blazes.

The is Jan. 31, at which time the county will have a clearer picture of the program’s impact on the budget, officials said.

“We are still collecting information and identifying how many properties will be signing up for the program and how many exemptions will be provided and the impacts on those revenues will not be known until that time,” Nishita said. “So once we have the calculations complete and the full picture of potential revenue loss is known then we will be able to update and notify the council regarding potential shortfalls.”

The budget committee, chaired by Councilwoman Yuki Lei Sugimura, deferred any decision on Bissen’s request to revoke his amended budget bill pending receipt of a fuller financial outlook from county analysts.

“As you know, the wildfire is top of mind for all of us,” Sugimura said. “And we are faced with many unknowns, which need to be addressed. Knowing the administration’s plans and how we will move forward with rebuilding and recovery will help all of us.”

To that end, Maui County’s newly formed Office of Recovery, led by Nishita, has nearly exhausted more than $20 million in seed money. Finance Director Scott Teruya told council members that the Bissen administration will soon make a request for additional funds to keep the office charged with leading Lahaina’s years-long recovery up and running.

In the meantime, all county departments have sufficient funds to cover their operations, according to Budget Director Maria Zielinski.

Civil Beat’s coverage of Maui County is supported in part by grants from the Nuestro Futuro Foundation.