Legislators, gov Hawaii's economic downturn is forcing the Cayetano administration and state legislative leaders to rethink the state budget.
differ on budget fixes
State program cuts, hurricane
fund use and liquor tax hikes
are offered as plansBy Richard Borreca
rborreca@starbulletin.comIn a series of announcements yesterday, legislators said they wanted to drop state programs and special funds. Meanwhile, Gov. Ben Cayetano issued his supplemental state budget, which calls for budget cuts of 1 percent during this fiscal year and 2 percent in the next.
Meanwhile, tax revenues have fallen. New figures released yesterday show that state tax collections were down almost 8 percent last month.
The state collections for the first half of this fiscal year are still running nearly 1 percent ahead of last year. Those numbers forced the Council on Revenues to keep their current revenue projections the same.
Still, Cayetano wants to increase spending for school construction by $255 million, for a total new construction budget of $900 million.
"Inaction or delayed action by government in such times of crisis is tantamount to a breach of the public trust. Let's get something done," Cayetano said.
Included in Cayetano's call for new spending is $1.5 million for a new prison on the Big Island and another $1.5 million to replace the Oahu Community Correctional Center.
To make it all balance, Cayetano says the state must tap the $213 million remaining in the Hawaii Hurricane Relief Fund and increase the state liquor tax.
Both ideas are not meeting with approval from legislators, who are scheduled to convene Wednesday for their regular session.
Rep. Marcus Oshiro (D, Wahiawa), House majority leader, says other special funds besides the hurricane relief fund should be tapped.
"The general feeling of the Democratic caucus is to keep the hurricane relief funds intact and maintain its integrity in case it is needed for another hurricane," he said.
Regarding Cayetano's proposed liquor tax increase, Oshiro said he doubted the Legislature would move to raise any taxes this year.
To cut the budget, Democrats would look at forming a local version of the federal base closure act to trim unneeded state programs, Oshiro said.
"It would look at each department and division and make recommendations on where cuts could be justified," Oshiro said.
He said the Legislature has been unable to tackle the job of trimming government head-on because each department has its own group of supporters.
"We can't do it within the legislative process," he said.
But Oshiro said the economic downturn triggered by the Sept. 11 terrorist attack has caused the Legislature to focus on consolidating state programs.
Sen. Sam Slom (R, Hawaii Kai), Senate GOP leader, said he thought it was the responsibility of the Legislature to trim government.
"If there were more of a balance in the Legislature, it could be accomplished because Republicans have been talking about this for years," he said.
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