Harris would be "singing a different tune" if he knew the full scope of Cayetano's financial plan, Anzai said last night after he and Cayetano held a closed-door briefing for House Democrats.

Cayetano's plan would create a financial windfall for Honolulu and the other counties that would easily offset any losses they would suffer with a cap on the counties' share of hotel room tax revenues, Anzai said.

Cayetano wants to cap the counties' portion of the hotel room tax to free a larger share of the tax to pay for tourism promotion and the state convention center.

Anzai said Harris and other county officials don't know that the administration's initiatives also include a proposal that would reduce the amount the state and the counties would have to pay into the pension plan for their employees.

Currently, if the Employees Retirement System's investment earnings fail to meet the legally required 8 percent gain, the state and counties must make contributions to reach the 8 percent level.

But Cayetano is now proposing that the law be changed so that the 8 percent earnings standard is not based solely on the value of the stocks and bonds sold, but also on the book value of the stocks and bonds that remain in the retirement system portfolio.

Rarely have both the retirement system's "realized" and "unrealized" earnings dipped below 8 percent in the same year, Anzai said.

So unless the law is changed, the state next year will have to make a $54.7 million contribution into the retirement system. That's because in 1995 the so-called "realized" earnings from the stocks and bonds sold were less than 8 percent, although the "unrealized" earnings were well above 8 percent, Anzai said.

The $54.7 million that would be freed is more than enough to fund Cayetano's $53 million tax relief program for hotel owners, first-

time home-buyers, Kauai and Molokai businesses, college students, low-income taxpayers and those caring for elderly family members.

The counties would also be beneficiaries of "the double trigger" Cayetano is proposing, Anzai said.

"The counties are going to have a windfall. So when (Harris and other county officials) start screaming about what the state is doing on the TAT (the transient accommodations tax, or hotel room tax), I hope you guys remind them what we've done for them," Anzai said.

Anzai said he did not immediately recall how much Honolulu would gain with the proposed change in the retirement system law.

Nor could he quickly recall how much Honolulu would lose under Cayetano's proposed cap on the counties share of the hotel room tax.

The proposed changes won't threaten the pensions of retired state and county workers, Anzai said.

"We have never missed and I don't expect we'll ever miss a retirement check for a retiree," Anzai added.