Lingle and legislators rebuff UH over request to pay for ‘shortfall’
The University of Hawaii is asking for the state's help in meeting a projected $15 million shortfall in its budget over the next two years due to higher-than-expected electricity and sewer costs.
But the lateness of the request, combined with fewer state dollars to go around for all agencies and programs, means it likely will go unmet, lawmakers say.
The university's shortfalls are projected to be $4.5 million this fiscal year, which ends June 30, and $10.5 million in fiscal year 2009.
"Obviously it's going to have an impact," said university spokeswoman Carolyn Tanaka. "That's a fairly huge shortfall that we need to cover, but specifically how it will impact? At this point I don't know."
Tanaka said the university submitted the emergency funding request to Gov. Linda Lingle's office early last month, but it was denied.
Lingle's office said it was checking on the status of the request to determine when it was formally submitted.
Requests for emergency funds typically are made at the beginning of session.
Lawmakers begin meeting next week in joint House-Senate conference committees to craft final versions of all bills, including the supplemental budget for the biennium. The current $10.7 billion budget bill is about $32.4 million smaller than the one proposed by Lingle, with little room for additional spending due to lower state revenue projections.
After being denied by the Governor's Office, university President David McClain appealed to the Legislature, but lawmakers say they are unable to appropriate emergency funds without a request from the governor.
"That's her prerogative," said Senate Ways and Means Chairwoman Rosalyn Baker (D, Honokohau-Makena). "They wouldn't be the first entity that had made a request to the governor that got denied."
Both Baker and her House counterpart, Finance Chairman Marcus Oshiro, said no other agency has approached them with similar requests since the session started. But as global crude oil prices continue to rise -- fueling higher energy costs statewide -- they expect more emergency fund requests next year.
"It may be a sign of things to come," said Oshiro (D, Wahiawa-Poamoho).
In his letter, dated March 27, McClain blamed the "unanticipated problem" on increasing utility rates "attributed to the rising cost of oil, currently over $100 per barrel."
McClain said the university also did not account for a 4.96 percent rate increase instituted by Hawaiian Electric Co. late last year. Projected shortfalls for water and sewer payments were blamed primarily on recent nonresidential rate increases approved by the City Council.
The university can make another request for emergency funds next year.