17 bills await action
as special session
opens today

Legislators will take up measures
intended to address the statewide
economic downturn

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By Richard Borreca
rborreca@starbulletin.com

A statewide economic crisis forces the Legislature into a special session beginning today.

Legislators are dealing with a situation that Gov. Ben Cayetano calls the worst ever faced by the state, which until the Sept. 11 terrorist attacks was looking at an economic rebound.

Now, lawmakers want emergency laws to help the economy, spur investment and help the thousands who have been laid off due to the slowdown in tourism. The session is expected to last six days, with a recess tomorrow.

Hawaii and at least four other states have called emergency sessions to deal with the economic fallout of the war on terrorism.

House Vice Speaker Sylvia Luke, (D, Nuuanu-Dowsett Highlands-Pacific Heights-Pauoa-Punchbowl) called the 17 bills under consideration a realization that "people are hurting out there."

The package has much of what Cayetano proposed, including emergency powers to suspend or waive state leases, rents and fees to help concessions at state airports, where visitor arrivals are still down more than 20 percent.

The legislative package, however, does not include Cayetano's glamour item, a $1 billion construction budget.

Legislators, led by Speaker of the House Calvin Say (D, Palolo Valley-St. Louis Heights-Kaimuki), fear the state will be unable to afford $1 billion in construction, so they dropped it down to $100 million.

Instead, they aim to spur construction by giving tax credits for new hotel and residential renovations or construction.

Cayetano did get approval for his request for a University of Hawaii medical school to be built on state land at Kakaako, but legislators refused to give the administration a clear OK to develop a major new university campus at Kapolei.

Luke said the legislative leaders instead called for $8 million of the $100 million in construction for planning and design for the new UH campus.

Cayetano and the Legislature also appeared to be in agreement on other measures. Because of the limited number of days of the special session and rules governing the passage of legislation, lawmakers have discussed the bills in unofficial sessions to reach substantial agreement.

Other measures include a new employment bill that would put $1.5 million into a job program. The state would hire available workers to do mosquito eradication and pull weeds that are threatening the environment.

Luke said 17 measures have support from both the GOP and the majority Democrats, representing a "bipartisan, bicameral package."

"Some deal with unemployment, some deal with immediate tax relief, and some will help the tourist industry," Luke said.

One area of disagreement is the emergency powers bill. The 19 House Republicans say the measure is too broad and gives too much power to Cayetano.

"The emergency powers bill is essentially a blank check, and we won't sign off on that," said Rep. Galen Fox (R, Waikiki-Ala Wai), GOP leader.

Fox and Sen. Sam Slom (R, Kalama Valley-Aina Haina), Senate GOP leader, also called for tax cuts to spur the economy. Specifically, they suggested a tax holiday and cutting the tax on food.

Senate President Robert Bunda, (D, Wahiawa-North Shore) said the GOP tax-cutting proposals were likely to take money away from the state and could result in the state having less money for established programs.

"The bottom line is, we have to take a generally more responsible position. We are investing in this community -- we need every dollar we can get," Bunda said.

The tax bill that appears to have broad support would give hotel owners a tax credit of 6 percent for new construction or renovation. Residential property owners would get a 4 percent tax credit on the first $250,000 in new construction or renovation.