Mayor Blangiardi submits Fiscal Year 2026 budget proposals to the Honolulu City Council

News Release from Office of the Mayor, February 28, 2025

HONOLULU – Mayor Rick Blangiardi on Friday submitted to the Honolulu City Council his proposed $3.93 billion Operating and $1.21 billion Capital Improvement Program (CIP) budgets for Fiscal Year 2026. The budget proposals focus on driving execution of City priorities through leadership, innovation, fiscally responsible spending and cross-sector collaboration.

Included among Mayor Blangiardi’s spending priorities for the upcoming fiscal year are significant funding allocations for affordable housing, with an emphasis on the planning and design of transit-oriented communities near rail stations, along with larger allocations to address homelessness-related issues and increased funding for public safety agencies, including millions for capital improvements to Honolulu’s police, fire, ambulance, and ocean safety facilities.

“Our Fiscal Year 2026 budget is a bold and strategic investment in O‘ahu’s future—one that prioritizes housing, public safety, and critical infrastructure while maintaining our commitment to fiscal responsibility,” said Mayor Rick Blangiardi. “By focusing on leadership, innovation, and collaboration, we are addressing the most pressing needs of our residents and laying the foundation for a stronger, more resilient very special place we call home.”

In all, the City’s $3.93 billion Operating budget proposal represents an increase of 8.4% over the adopted $3.63 billion budget for the previous fiscal year. The proposed $1.21 billion Capital Improvement Project budget for FY 2026 is 15.8% more than the adopted $1.05 billion CIP budget for FY 2025.

The major estimated resources to fund City programs and activities include $1.77 billion in real property tax revenue, $1.24 billion in estimated unreserved fund balances carryover from FY 2025, and $108.2 million in Oʻahu Transient Accommodations Tax revenue.

At $976.7 million, which represents 24.8% of the proposed FY 2026 operating budget, the single largest category of expenditures is primarily funding for City employee benefits, including healthcare benefits, retirement benefits, post-employment benefits, and salary adjustments. Debt service comprises roughly 18% of the Operating budget, at $696.8 million, including principal and interest payments of $503 million for general obligation bonds and $193.8 million for sewer revenue bonds.

Spending on operational costs for the City’s public safety and public health agencies (the Honolulu Police, Honolulu Fire, Honolulu Emergency Services, and Honolulu Ocean Safety departments) represents roughly 17% of the proposed Operating budget, at $657.2 million. Allocated funding for TheBus, TheHandi-Van, and Skyline mass transit programs comes in at $476.7 million, which is approximately 12% of the proposed operating budget.

The proposed CIP budget of $1.21 billion is allocated across key infrastructure and public service projects, including:

$533.7 million for refuse and sewer projects mandated by the 2010 Global Consent Decree (Sanitation Function);
$207.0 million for bikeways, highways, streets, bridges, storm drainage, and street lighting (Highways and Streets Function);
$143.8 million for affordable housing and homeless service facilities (Human Services);
$86.1 million for parks, the Neal S. Blaisdell Center, Honolulu Zoo, and golf courses;
$86.0 million for the acquisition of buses and handi-vans, bus stop and ADA access improvements, and upgrades to the Middle Street Intermodal Transit Center (Mass Transit Function);
$82.5 million for police, fire, ocean safety, ambulance, telecommunications, and traffic and flood control improvements (Public Safety Function);
$73.3 million for civic center upgrades, transportation electrification, energy conservation projects, and enhancements to bus and traffic facilities, public buildings, and municipal parking (General Government);

Notable FY 2026 budget proposal highlights include:

$244.2 million to fund major CIP at the Honouliuli and the Sand Island wastewater treatment plants;
$100 million for affordable housing mixed-use development, and $10.4 million for the renovation and/or development of low-income affordable housing units;
$76.0 million for the Salt Lake Boulevard Widening project;
$74.2 million for the acquisition of new buses and handi-van vehicles;
$65.0 million for park improvements across Oʻahu, and the acquisition of preservation and conservation lands;
More than $28.0 million for homeless-related services and other activities to enhance public safety and health;

The FY 2026 operating budget includes $10 million of funding to cover any losses of federal funding for key programs, especially funding for personnel costs under those programs.

The 2026 fiscal year Operating and Capital Improvement Project budget bills are posted at https://hnldoc.ehawaii.gov/hnldoc under “Bills,” and the complete report and executive summary will be posted on the same site under “Communications.”

The budget documents will also be available at the following Google Drive link until they are posted on the City Council website: https://www.honolulucitycouncil.org/

—PAU—

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