Legislators reject Lingle's bid to cut salaries of state workers


POSTED: Wednesday, April 01, 2009

Gov. Linda Lingle talked finances with a Senate committee for two hours yesterday, but failed to persuade legislators to adopt her plan to cut state workers' pay and benefits.

;[Preview]  Governor Urges Senators To Pass Budget Cuts

Governor Lingle told state senators if they refuse to accept her proposal to fix the state budget shortfall more than 2 thousand public workers might have to be laid off.

Watch  ]


Instead, legislative leaders said they would stick with cutting services, reducing costs and raising taxes to balance the state budget.

Lingle offered a new proposal to the Senate Ways and Means Committee: Don't wait for labor negotiations, cut the budget now by $278 million. That's the amount of pay and benefit reductions Lingle wants to realize in negotiations with the public worker unions.

Lingle said the contract talks are likely to go past the Legislature's scheduled May 7 adjournment, so the budget should just be cut now to include the pay reductions. If they were not realized, she would cut the budget some other, unspecified way.

“;It is not possible within your time frame to know the outcome of these negotiations. By definition, it is not possible,”; Lingle told the senators.

After the meeting, leaders of both the House and Senate finance committees rejected Lingle's idea, saying they would look at tax increases instead.

“;If it is just all left to you in the end, where is the public input?”; asked Sen. Donna Mercado Kim, Ways and Means Committee chairwoman.

Lingle said it is her way or expect tax increases.

“;Either work with us to adopt a version of the budget that we propose ... or resort to massive layoffs and tax increases,”; Lingle said.

Randy Perreira, Hawaii Government Employees Association executive director, also is urging lawmakers to raise taxes as a way to balance the budget.

“;Raising taxes has got to be part of the mix,”; Perreira said.

Rep. Marcus Oshiro, House Finance Committee chairman, said Lingle's proposal would put the Legislature in the middle of the negotiations, because if they cut out $278 million now, it would set a ceiling for state labor costs.

“;In the end, we will cut the budget, reduce costs and raise taxes. You need to do all three,”; Oshiro said.

Lingle tossed out the idea that she would be open to using a portion of the Hawaii Hurricane Relief Fund's $185 million to help balance the budget, but no legislators took up her suggestion.

The Republican governor also said she has not consulted with the four county mayors about her pay-cut plan because she hasn't formally sent the public worker unions a proposal. Still, Lingle advised the mayors—who Honolulu Mayor Mufi Hannemann says are skeptical of Lingle's plan—to think carefully.

The counties use real property taxes for revenue, which has a 12-to-18-month lag, so “;the deficits next year will be substantial,”; Lingle, a former Maui mayor, warned the counties.