Governor, legislators moving to close state's budget gap


POSTED: Tuesday, February 10, 2009

Gov. Lingle Lingle has led the effort to close the state's budget gap. The Star-Bulletin's Friday editorial incorrectly alleged that the executive and legislative branches are reluctant to address the problem. Nothing could be further from the truth.

Last week Lingle notified the Legislature how she proposes to address the $75 million shortfall in general funds the state faces between now and June 30. She will do so by using the state's rainy day fund, tapping additional federal dollars that we can use instead of state money for Medicaid expenses and accelerating the transfer of excess funds from special accounts. The Legislature is already taking steps to enact these proposals.

This leaves an additional $600 million gap that still needs to be closed for the next two fiscal years. Lingle and key legislators have been meeting regularly to develop a plan that includes possible cutbacks in labor costs, fewer state programs and revenue enhancements. House Speaker Calvin Say has introduced more than 40 bills that would enact the tough changes that might have to be made in the state's operations to close the budget gap. And the governor and legislators have been consulting with public union leaders, the mayors and her budget specialists to review these options.

No final proposals will make sense until the Council on Revenues meets again in mid-March to provide updated estimates on the tax dollars the state is projected to collect. The speed and uncertainty of the current economic climate make it imperative that we work with the most current figures available. We will also know by then the total federal stimulus package enacted by the U.S. Congress and Hawaii's share of the stimulus.

It is often said that timing is everything. This is particularly true when facing Hawaii's current financial challenges. Lingle and key legislators understand the public deserves budget solutions that are well thought out and that meet current needs as well as position the state for the economic recovery that will occur in the future. We are focused on doing just that.


Linda L. Smith is senior policy adviser to Gov. Linda Lingle.