Governor's proposals would help both workers and businesses
GOV. Linda Lingle, in her State of the State address, asked the Legislature to commit to work together to ensure Hawaii's economic prosperity continues. It is gratifying to see during the first few weeks of this legislative session that a spirit of cooperation and cordiality has prevailed.
Governor Lingle has spent hours sitting in legislative hearings on energy self-sufficiency and affordable housing. She has also met with the chairpersons of various legislative committees. This has been time well spent.
Proposals to make the state energy self-sufficient are moving forward. So are bills to address identity theft, pedestrian safety and affordable housing and to protect crime victims. The governor's package of proposals to improve emergency preparedness is being heard in both the House and Senate. And a slew of proposals to improve our charter schools and get more teachers into classrooms are moving forward.
However, two important workforce improvement measures have not moved an inch. The first deals with lowering the wage base for unemployment insurance taxes. Hawaii has the lowest unemployment rate in the nation. We have built up a surplus of more than $450 million in the state's unemployment fund. Yet employers in Hawaii have to pay taxes on the first $34,000 every employee in the state earns. The federal minimum taxable wage base is $7,000.
THE GOVERNOR'S proposal (HB 2391 / SB 2354) would lower the tax base to the federal level ($7,000) for the next three years. This action would not cost the state a cent. But it would provide $165 million more for employers to raise wages, expand benefits, reinvest or hire more personnel. Unfortunately, these bills are stuck in the two labor committees, headed by Rep. Kirk Caldwell and Sen. Brian Kanno. The proposals must get a hearing and move to the next legislative committee by this Friday if we hope to keep this good idea alive.
The second workforce improvement measure also is stuck in the House and Senate labor committees. It involves correcting problems in the state's workers compensation system. This is the system that provides medical care for injured workers so they can return to work on a timely basis.
Hawaii's workers compensation system is so bad it has earned a grade of "F". Our employees stay out of work longer, receive care in a haphazard fashion, doctors do not want to take these patients, and employers pay excessively high insurance premiums as a result.
The governor has proposed two common-sense bills to set up a network of medical providers than can get an injured worker back on the job and to allow the director of the Department of Labor to make administrative improvements in the program. Again, there is no cost to taxpayers and much to gain in improved care for injured employees.
There is a chance these measures can remain alive, but only if Sen. Kanno and his colleagues on the labor committee are willing to give them a fair hearing and move them out before the Legislature's deadline of Feb. 17 (Friday).
WHEN LINGLE addressed the National Federation of Independent Businesses earlier this week and the Maui Chamber of Commerce last week, the members -- small and large business owners -- unanimously told her workers compensation and the unemployment insurance tax need to be addressed to help improve Hawaii's business climate.
We appreciate the cooperation and support Governor Lingle's office has received from House Speaker Calvin Say, Senate President Robert Bunda, the committee chairmen and members of both parties. There are thousands of legislative proposals that they must schedule and hear during these hectic first weeks of the session. We hope the labor committee chairmen can make time for three more good bills that deserve support.
Linda Smith is senior policy adviser to Gov. Linda Lingle.