HONOLULU -- Honolulu Mayor Mufi Hannemann on Tuesday laid out his $1.827 billion budget plan that includes cuts and furloughs.

The city faces a $98 million shortfall.

The city plans to pay for the shortfall in several ways.

The mayor plans to furlough city workers starting in July up to 24 days in the fiscal year for 5,200 employees belonging to the United Public Workers and Hawaii Government Employees Association.

Furloughs would save the city $19 million.

Another measure is to hike property taxes on homeowners who do not live in their houses. The property tax rate would go from $3.42 to $3.72 per $1,000 of value. That should make up nearly $18 million, city officials said.

The Mayor says about 120,000 people own investment homes here.

"Some are not full-time residents of Hawaii. I have heard from them that we have some of the lowest property taxes in the world. And given the service they enjoy in Honolulu, I would say it is a great bargain," said Hannemann.

The mayor plans to keep the property tax rate for owner-occupant homes and condominiums at the same rate.

He also will spare commercial properties, agricultural land and hotels from property from tax hikes.

Marianne Wassel owns commercial property in downtown Honolulu.

I am very relieved, very relieved when everything else is going up," she said.

The mayor did not propose new user fees or to increase existing fees.

The plan assumes that the counties will keep their share of the transient accommodation tax (hotel room tax).

Honolulu Council Chairman Todd Apo called the mayor's plan a good starting point.

"It is the details we are going to have to look at," said Apo.

Council members have until June 9 to review the mayor's ideas and come up with their own final version of the budget.