Legislature 2002

Hurricane fund use
is gaining support

A key lawmaker says
the money is needed to ease
the state's budget woes

By Richard Borreca

As the choices for balancing the state budget narrow, legislators are edging closer to tapping the Hawaii Hurricane Relief Fund to get the state out of the red.

"I am hoping that the members come to the conclusion that I have come to, that we are going to have to use part of it," Sen. Brian Taniguchi (D, Manoa), Ways and Means Committee chairman, said yesterday.

The budget is out of balance by more than $300 million as lawmakers are faced with pleas for more state money. The Department of Education, for instance, was hoping for a budget increase of more than $55 million but is now slated for cuts.

Yesterday, the Ways and Means Committee met on the Kuhio Day state holiday to start reviewing budget cuts made by the House and Taniguchi's suggested deletions.

The Senate budget leader is looking at taking money in special state funds because those accounts, set up outside the budget's general fund, were identified in past audits as having surpluses.

The special accounts are set up to protect key state programs from having to go before the Legislature every year for funding, but this year, Taniguchi said, fewer programs are considered sacred.

"Generally speaking, we are going to have to take some," Taniguchi warned.

State officials testified against the special-fund raids, saying programs such as high-tech and tourism promotion would be damaged.

But Taniguchi said a position is developing that the legislators will have to chose between raiding special funds or the hurricane fund.

"If the members don't want to use the hurricane relief fund, and there are some members who don't, then the other things, such as the increased liquor and tobacco tax, and the raid (on special funds) will become more important," Taniguchi said. "And that is without adding anything for education."

The state started the hurricane fund when insurance firms refused to insure local property against hurricane damage after huge losses from Hurricane Iniki in 1992. The fund, which has $213 million, has been discontinued; state Republicans have argued that the remaining money should be returned to homeowners.

The House is proposing taking roughly half of the hurricane fund for the budget.

Republicans complain that once the money in the hurricane fund is gone, there will not be another source of funds, and the budget balancing act will be postponed a year.

However, Gov. Ben Cayetano, who proposes using all of the hurricane fund, said the economy will improve, giving the state more tax money. Until that happens, he said, the state should use the hurricane fund.

"All of this debate over the hurricane relief fund and confusion that now reigns among the people is so unnecessary," Cayetano said yesterday. "It is a result of the politics that have been played with the hurricane relief fund. Its unfortunate because now the Legislature, the Democratic majority, is so concerned about the public reaction that they're beginning to turn over every rock and hiding place looking for money."

Like many of his state department heads, Cayetano said he had "serious issues" with some of the special-fund raids contemplated by the Legislature.

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