By Ken Sakamoto, Star-Bulletin
Senate President Norman Mizuguchi leads the applause in the Senate chambers today at the opening of the 19th State Legislature. Also on hand are, from left, U.S. Rep. Neil Abercrombie, Gov. Ben Cayetano, Vicky Cayetano and Lt. Gov. Mazie Hirono.
Pressure's on
Reviving the economy has top
billing on opening day
Guide to the lawmakers of the '98 LegislaturePrivatization, right to die on agenda
By Mike Yuen
Star-BulletinThe1998 Legislature convened today with Senate President Norman Mizuguchi proposing 10 initiatives to stimulate the isle's stagnant economy and downsize government that go beyond recommendations of Gov. Ben Cayetano's Economic Revitalization Task Force. They include small-business tax breaks for advertising and for home and business renovations; a year's waiver of business registration and licensing fees; not filling 50 percent of general-funded personnel vacancies; and creating an independent commission to determine which public schools with declining enrollments should be closed.
Unlike House Speaker Joe Souki, whose opening-day speech was more of an advocate for the economic task force plan, Mizuguchi said the plan should be merely the starting point for deliberations.
"Not all groups in our community - and not all members of the Legislature - agree with the recommendations in their entirety. But I urge you not to reject any recommendation without offering something better," said Mizuguchi (D, Aiea), who, with Souki (D, Wailuku), was a task force member.
Mizuguchi's other options include giving small businesses tax credits for the difference they spent on advertising this year compared to last year. "This credit would help small businesses to maintain and boost their spending on advertising when harsh economic times would ordinarily reduce or curtail it," he said.
He also proposed a small business and home renovation tax credit equal to 50 percent of the total planning costs associated with renovating a small business or home.
To curtail personnel costs, which, at 53 percent, is the largest component of the state budget, Mizuguchi recommended that half of all general-funded vacancies not be filled, with the funds sent back to the cash-tight general fund.
The other half of vacant positions would be assigned to two pools, one controlled by Cayetano, the other by Hawaii Chief Justice Ronald Moon.
"The objective is to reduce systemically the personnel services budget and to provide the governor and the chief justice with appropriate authority and the flexibility to determine the personnel priorities of their branches," Mizuguchi said.
"As a complementary measure, we will prohibit the current widespread practice of creating exempt positions and circumventing civil service requirements."
Citing what he called unresponsiveness by Department of Education officials to wisely use state funds - the DOE is allocated the largest share of state resources - Mizuguchi said the Senate will consider establishing an impartial commission to consider which declining schools should be closed. It would be modeled on the federal commissions used to shut military bases.
Pointing to the Cayetano administration's failure to consolidate specific departments as was ordered by the 1996 Legislature, Mizuguchi said: "I also recommend we put teeth in the consolidation law by mandating a general fund savings of at least 5 percent."
Mizuguchi and Souki concur on having an intensive review of child-protection laws to ensure that recent cases of child abuse deaths are not repeated.
There was a common theme in both Mizuguchi's and Souki's speeches: with a laggard economy, lawmakers face a daunting task this session.
"It will probably be the toughest session for all of us," Souki said. "For what we will be proposing to do will be radical, controversial and painful."
Mizuguchi's assessment: "We cannot afford to drift - to 'wait and see' and hope that things will get better. Our problems are already too long lasting. Strong measures are needed, and needed now, to get the economy moving again."
The economic task force proposal to raise the general excise tax from 4 percent to 5.35 percent - a lightning rod for criticism - must not be viewed in isolation, Souki stressed. It must be view as part of a comprehensive package that reduces the "pyramiding" of the excise tax, which is levied at every level of production, distribution and sale; cuts personal and corporate income taxes; and provides a low-income tax credit.
"We will lower overall taxes by $100 million in the near future and by $400 million over three years," Souki said.
The House, which last session pushed harder for the privatization of government services than the Senate, will again continue its efforts, Souki added.
Echoing the task force, Souki proposed replacing the elected Board of Education with county-based school boards appointed by the governor.
"We will set two strategic goals for our students: that all eighth-grade students be computer literate by the year 2000 and that all high school graduates by the year 2004 speak a second language," Souki said.
To bolster tourism, the state's No. 1 industry, Souki asserted that "it is imperative" to provide a stable revenue source for tourism marketing by restructuring visitor-related taxes to fund an independent Hawaii Tourism Board.
By Craig T. Kojima, Star-Bulletin
Nalani Kamano performs at the Capitol Rotunda yesterday. She was with the Hawaiian-language immersion program Ke Kula Kaiapuni o Anuenue to protest budget cuts. Below, Shoes are left in a line as Ke Kula Kaiapuni O Anuenue made its presentation to legislators..
GOP leader wants
By Mike Yuen
legalized gambling
Star-BulletinSenate Minority Leader Whitney Anderson today proposed legalized gambling and tax breaks to nurture new small businesses as two of several alternatives to initiatives pushed by the Economic Revitalization Task Force. Moreover, Anderson, along with his House counterpart, Rep. Quentin Kawananakoa, used their opening-day speeches to adamantly reiterate their opposition to the panel's recommendation to raise the general excise tax from 4 percent to 5.35 percent.
Kawananakoa (R, Nuuanu) said "let me draw this line in the sand right now. This minority cannot, must not, and will not support a 34 percent increase in Hawaii's general excise tax."
Anderson (R, Kailua) asserted: "We simply cannot afford an increase in taxes - of any kind."
Anderson added that an excise tax hike won't hit the rich or the poor the hardest: "The greatest impact will be on the middle class and small business."
The tax hike, he continued, will help "big organizations or corporations, such as the banks (which) are exempt from the excise and other taxes."
The facts about gambling are self-evident, Anderson said. Thirty-six states and the District of Columbia have lotteries and government profits averaged about $209.8 million in fiscal 1994. Rhode Island, which has about the same population as Hawaii, profited by $56.3 million, he added.
"I have introduced in the past and will do so again, legislation asking for an advisory referendum, which does not involve a constitutional change," he said.
Granting new small businesses a tax break for the first two years should help such firms succeed, and stimulate the economy in general, Anderson said.
Anderson also said lawmakers need to clarify state laws to prevent government privatization from being stymied and to curb rulings like the Hawaii Supreme Court's last year that a state worker can collect worker's compensation for stress caused by a disciplinary action.
Kawananakoa again pushed the House Republican legislative package, whose economic component is a tax simplification plan that would make an isle's state tax burden one-third of what's paid to the federal government. This is touted as saving an average family of four $1,000 annually and putting $180 million back into Hawaii's economy without having to raise the excise tax.
On education, Kawananakoa said: "Our plan calls for smaller, teacher-driven schools of no more than 300 students in an elementary school or 600 in a high school. Over 170 national studies show that smaller schools work."
By Craig T. Kojima, Star-Bulletin
As the Legislature prepares to convene, Lani Kealoha displayed the Hawaii state flag at a demonstration by the Hawaiian language immersion program Ke Kula Kaiapuni O Anuenue against cuts in their budget.
The proposals unveiled by Senate President Norman Mizuguchi today: Senate president's initiatives
Economic revitalization
Grant small businesses tax credits for advertising.
Government downsizing
Human services
Environment
Opening festivities less
elaborate, but just as fun
By Craig T. Kojima, Star-Bulletin
Volunteer Millie Snyder organizes gift from well-wishers at the start of the session.
Pat Omandam
Star-BulletinCoochie Cayan stood on the Capitol rotunda this morning, waiting her turn to enter the state House chamber. Surveying the crowd, she noted that compared with past years, there were a lot more "everyday" people than government or business officials lining up to attend opening day ceremonies.
"That could send a signal to the Legislature," said Cayan, who has attended the Legislature's opener for the past three years.
Senate President Norman Mizuguchi told a chamber full of state officials, families, friends and the public today that fundamental changes must be made in Hawaii's economy if people are to prosper. He also called for an intensive review of child protection laws in the wake of several deaths of children under state care.
It was a sentiment echoed in the House by Kumu Hula Kawai Aona-Ueoka, who gave a tearful opening chant in Hawaiian of "Malama Na Keiki" - take care of the children.
"So much is being taken away from our children, our future," Aona-Ueoka said.
"If you pass laws that support the children you cannot go wrong because that's our future," she said.
Peggy Lui, office manager for state Rep. Ed Case, said the thrill of opening day may be tempered by the state's struggling economy. But she believes the camaraderie it brings out makes it a memorable event. "It's really festive," she said. "It just excites me."
Since last Friday, bouquets of flowers have trickled into the Capitol basement from well-wishers, where they are sorted by alphabetical order for lawmakers. In return, many reciprocate with food - both homemade and catered - such as the mini lau lau at Case's office, or the sworn-to-be-ono homemade cheesecake from Sen. David Ige's staff.
Lui, along with her husband, Joseph, have provided the bite-size lau lau for visitors for the past three years. She said the pupu has drawn such raves that Capitol security wanted to reserve some even though they're offered on a first-come, first-served basis.
At state Rep. Jun Abinsay's office, Christina Sabino says the public can count on traditional Filipino delicacies. The low-key opening mirrors the state's economic situation as well as the Legislature's intent to get back to work as soon as possible, she said.
To that end, Souki and Mizuguchi have asked that receptions end by 2 p.m. today so that some committees can begin briefings and hearings.
Elsewhere, Sen. Cal Kawamoto's office has catered a Hawaiian menu that includes chicken long rice, lomi salmon and baked teriyaki chicken, while state Rep. K. Mark Takai's mother has taken on the task of home-cooking the beef stew and kalua pig shared at her son's office.
