Lingle merits praise on stimulus spending


POSTED: Wednesday, August 26, 2009

Sen. Daniel Inouye departed a hearing on Hawaii's expenditure of federal stimulus money satisfied that the state is making good use of it. The funds are expected to be needed over a three-year period but early use is vital in bringing the state out of the dire economic slump. The Lingle administration appears to be acting responsibly, despite recent flawed criticism.

Bipartisan cooperation is important between Republican Gov. Linda Lingle and Democrat Inouye, chairman of the Senate Appropriations Committee. In Monday's hearing, Lingle praised Inouye's Honolulu chief of staff for help in coordinating the effort. “;I feel assured that we are going to come out of this with flying colors,”; Inouye said at the close of the hearing.

That spirit was questionable last week, when Rep. Neil Abercrombie joined James Oberstar, D-Minn., in chastising the Lingle administration for not using enough stimulus money for state transportation projects. In a letter to Lingle released by Abercrombie, Oberstar wrote that Hawaii has been too slow in steering the money to transportation projects.

Oberstar alleged that more than a third of Hawaii's transportation stimulus dollars were for projects out for bid, and no contracts had been signed or work begun. Abercrombie said the state “;is running the risk of losing everything it's due to other states that have taken action and are doing something to get their economy moving.”;

Brennon Morioka, the state transportation director, responded that ground has been broken on three stimulus projects and soon will begin on a fourth. Lingle told Inouye that Hawaii has been allocated $246 million for transportation projects, and governors are challenged in following federal accountability and reporting requirements before shovels can be put into action.

Understandable. Still, given the state's economic woes—which are expected to worsen—the effort to maximize federal stimulus funds needs to get even more aggressive.

Hawaii has been slated to receive $1.4 billion over the next two years and has been officially awarded nearly $630 million of it since the stimulus law was enacted in February, Lingle said. Of that, it has spent $223.9 million, about 36 percent.

A quarterly economic report this week by the Lingle administration forecasts that the state's economy is unlikely to recover this year, is not likely to stabilize until next year and will not see signs of modest growth until 2011.

Even then, Hawaii is likely to experience budget deficits. In a survey last month by the National Conference of State Legislatures, the Lingle administration projected a $775.5 million budget gap in the 2011 fiscal year and a $1.2 billion shortfall in the following year.

According to the survey, Hawaii used 21 percent of the stimulus funds to help cover the budget shortfall. Most of the other 24 states that responded to the survey poured more into their budgets, topped by Texas' 96.7 percent. That may have helped balance budgets—but is hardly an economic stimulus.