Governor and Mrs. Cayetano, Chief Justice Moon, Senator and Mrs. Akaka, Congressman Abercrombie, Congresswoman Mink, Mayors Harris, Apana, Kim, Kusaka, Governor and Mrs. Waihee, Mrs. Jean Ariyoshi and son Donn, esteemed colleagues, honored guests, ladies and gentlemen: Opening Day Remarks
Senate President Robert BundaIt is indeed a pleasure and a privilege to open the 2002 regular session of the 21st Legislature. Welcome to what promises to be another demanding and challenging 60 days of hard work.
At the end of our last session, we congratulated ourselves on what we accomplished. We found the resources to meet the many needs of our community. The economy was rebounding, tax collections were up, and we seemed to be finally turning the corner on our long-standing budget woes. Our work done, we adjourned, relieved and satisfied with what we had achieved. But an already faltering national economy, the September 11th terrorist attacks, a local economic crisis, and three special sessions later, it's clear that our relief was not meant to last. In fact, our work had only just begun.
This year, we'll be reopening our budget, not to add supplemental items but to find ways to fund or cut $150 million or more. How we find the money will be at the very top of our legislative agenda. As we deliberate on the issues before us, let us keep in mind the responsibilities and powers we hold as members of the Senate. I speak of our responsibility and power for oversight of government.
I am speaking of control. For too many years, particularly during flush times, we have approved spending without asking the tough questions surrounding those expenses. We need to regain our control over the direction of government and public expenditures, because if we don't, who will?
Let me give you a prime example of program spending that is out of control. The Joint House and Senate Investigative Committee on Felix revealed the flaws in our blanket approval of funding for the consent decree, now almost $1.5 billion since 1994. The fact is, no one really knows the true cost of Felix. Furthermore, neither the Department of Education nor the Department of Health can accurately account for the use of this public money. Accurate by our standards, not the Department's, -- not the court-appointed monitor, -- and not even Judge Ezra's evaluation, but ours, the elected body given the responsibility of oversight. For this reason, we will be extending the life of the Investigative Committee and continue to search for an accurate accounting of Felix expenses.
And while we seek to halt unchecked, unquestioned government spending, let's also give support to those who are not afraid to offer new ideas, who constantly seek new ways of doing things, and who dare to try different approaches to old problems. I want to publicly commend School Superintendent Pat Hamamoto who is taking steps to decentralize the school districts in order to put the resources where they are most needed. That kind of bold thinking must be encouraged and supported by the Legislature.
An example of bold thinking can be found at the University of Hawaii where President Evan Dobelle formulated and then lobbied hard for the construction of cancer and biomedical research centers as part of a medical school complex in Kakaako. We approved the funding of $150 million towards construction. He convinced legislators of his ability to match that amount through private funds. We would not have done this if we did not feel that he and Dean Cadman were in full control of the project, one that has the potential to stimulate our struggling economy as well as provide better access to quality health care in Hawaii.
We should likewise give serious consideration to a proposal to transfer control and management of the Aloha Stadium to the University of Hawaii. Yes, there are questions in such a move, but Head Football Coach June Jones and Athletic Director Hugh Yoshida may be able to take the athletic program and the stadium to new levels, if given a chance. I say we give them the opportunity.
Another proposal we will examine is funding for the Hawaii Tourism Authority.
We have seen how fragile our tourism-based economy really is in the after shock of September 11th. While we seem to be recovering, the fact remains that we need to look at where we are, and where we're going with tourism, given the economic problems of national and foreign markets like Japan. Hawaii already had a positive image worldwide. We need to take full advantage of this and look beyond just marketing. We need to take stock and upgrade the product we are selling. Why spend millions of dollars on advertising if public rest rooms, interpretive signs, historical information and cultural explanations are inadequate for our visitors?
We will be redefining the Hawaii Tourism Authority's funding this session and I suggest we also underwrite part of the maintenance of our state parks and trails, particularly those impacted by high tourist traffic. Our parks and beaches are heavily used by visitors and residents alike, yet our maintenance program has been woefully under-funded. The Hawaii Tourism Authority should be encouraged to partner with other government agencies to resolve tourist-related issues.
This would be a new approach to an old problem, not spending any more but spending smarter.
Another smart move to save time and money is in the area of the repair and maintenance of our schools. We will recommend that the separate repair and maintenance operations of the Department of Accounting and General Services and Department of Education be consolidated under one roof to streamline the entire spectrum of decision-making. This should provide better control of the process and speed the design, permitting, bidding, and construction needed to eliminate the huge backlog of repairs to our public schools.
There are many other things we can do. There are 25 sources of ideas in this chamber; there are 51 more across the hall. Countless more will come forward from the community. If we exercise our responsibilities and powers, if we dare to be bold rather than cautious, if we are hopeful rather than cynical, I know we can make a difference in the financial solvency and direction of state government.
That said, let's return to the budget and all its related issues.
The most talked-about solution to our budget shortfall is the $213 million in the Hawaii Hurricane Relief Fund. I was one of the co-authors of the bill that established the hurricane fund in 1993. Our purpose was to provide protection to homeowners who had very few choices, if any. Without the fund, people would have been left to the mercy of mortgage holders who could have demanded protection for their collateral, at rates much higher than the Hurricane Relief Fund was able to provide. It has been nearly ten years since Hurricane Iniki left us with $1.6 billion dollars in property damage. Using the Hurricane Relief Fund now would, in my opinion, be politically and fiscally unsound.
Should another hurricane strike, we would experience even deeper financial trouble. Given the budget and the state of our economy, it would be virtually impossible to replenish the fund in the aftermath of a hurricane. Therefore, the bulk of the fund should remain in reserve. But it makes good sense to set aside a portion of the money for homeowners to install hurricane mitigation measures that help to protect homes against more serious damage. We reduce our risk by strengthening our homes, making them less vulnerable to damage. Additionally, I am introducing legislation to address the possibility of creating a homeowners mutual insurance company. This new insurance entity could help stabilize the local market in the long run as we could depend on it to remain in the State in the event of a hurricane.
Another proposal being considered to raise revenues is gambling. Everyone seems to have an opinion on the matter, but this much is certain: Gambling will not solve our budget problems...not now...not even in the immediate future and I do not intend to advocate support for gaming under the duress of a fiscal crisis. Rather, the full social and economic impact of gambling needs to be openly and rationally discussed. Yet, this extremely controversial issue has defied attempts by the Legislature to reach any consensus. Perhaps it is time to let the voters decide. The legislative process tends to attract those strongly in favor of or adamantly opposed to a particular proposal. But we have yet to hear from the silent majority, and perhaps some form of referendum on gambling would lay this matter to rest. Individual opinions aside, we must agree that we will not let this controversy linger and dominate our agenda.
A far more practical answer to our budget crisis is squarely in our corner. In 1992, the Legislative Auditor issued a report to the Legislature entitled Loss of Budgetary Control: A Summary Report of the Review of Special and Revolving Funds. Like gambling, trying to control these funds has defied well-intentioned efforts by the Legislature. Last July, Auditor Marion Higa released an update of the 1992 study which pointed out that there are more than a hundred of these funds still in existence, with balances totaling as much as $220 million. Seventy of these funds failed to meet established criteria yet had cash balances totaling $96 million. We should not simply look to "raid" these funds to balance our budget, but rather to make meaningful changes in the way we structure our non-general funds. We are faced with an ideal opportunity to demonstrate our will to try new approaches, as well as to institute more accountability and oversight on the budget.
We need to regain control.
We will also take a hard look at the Governor's capital improvement budget request of $900 million, which includes $255 million for school repair and maintenance. Last year we appropriated roughly $500 million in CIP funding, and added another $100 million during the most recent special session. I anticipate that we will approve a moderate amount of additional money, primarily for school repair and maintenance. I would also ask legislators to support CIP funding for another area critical to the future of this State, and that is adequate infrastructure for our agricultural industry.
Over the years, drought conditions have threatened the survival of many small farm operations. Ditches and siphons unused since the days of sugar are falling into disrepair, a condition that some say cannot easily be restored once lost. These irrigation systems together with the construction of more modern networks, can supply water to hundreds of acres of prime agricultural land on each island.
Specific improvements could be made to our airports and harbors to provide refrigeration and consolidation of produce being transported to local, national and international markets. CIP funds could also be used for construction of a world-class Farmer's Market which would help to develop the nearly unlimited potential of our agricultural industry.
And finally:
On this date last year, I came before you advocating change...change in the workings of the Legislature, change in government to make it more responsive. We certainly answered that call for change, as evidenced by the legislation we approved.
This year, our problems are different. The need for exercising oversight and providing strong direction of government expenditures is more important than ever before. Seeking new and better ways of conducting the business of government must be our cause, our goal, and our obligation to the people of Hawaii. We must demonstrate to their satisfaction and to all other entities that deal with this body, that we are indeed, in control. Mahalo.
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