State of Hawaii

Senate debates
budget solutions

A proposal would use interest
from the hurricane fund
to balance the budget

By Richard Borreca

The question of how much of the $213 million in the state Hurricane Relief Fund should be used to balance the budget continues to snarl the state Senate.

The Democratic majority is considering taking a portion of the money in the fund, but only the anticipated interest to be earned on the $213 million.

Others, including Sen. Brian Taniguchi, Ways and Means chairman, had wanted to take up to $50 million of the fund, while the state House is proposing using $100 million for needed state social welfare and education programs.

Senate Democrats met for more than two hours yesterday to come up with a new budget strategy. But afterward, even Senate President Robert Bunda acknowledged that the Senate's position is still fluid.

"Obviously, we still have some guys in caucus, especially the chair of Ways and Means, who think we will ultimately need to use the hurricane fund, but the way we are tackling it, we are not (going to use it)," Bunda (D, Wahiawa-North Shore) said.

Taniguchi said the caucus position is difficult because he first developed a budget that used the hurricane fund, but then 16 senators, including 13 Democrats, signed a petition saying they were "opposed to the use of any moneys from the Hawaii Hurricane Relief Fund."

"We hashed this out. The caucus has authorized me to develop a package and incorporate a mixture of approaches," Taniguchi said after yesterday's meeting.

Now Taniguchi (D, Manoa) says the Senate Democrats have "agreed we would take a look at taking the interest" from the hurricane fund. The interest on the fund is expected to grow about $10 million a year, so lawmakers figure they could take that money without endangering the fund's ability to help restore insurance policies if another devastating hurricane hits Hawaii.

Still, Bunda worries that the Senate is divided on a plan to balance the budget by next week.

"There are some differences between what the caucus wants and what the Senate Ways and Means Committee sees, I am not going to deny it. There are some hurdles we have to overcome," Bunda said.

The House and Senate have to agree on the state budget by Friday.

Community groups are lobbying both House and Senate members to restore funds cut from the state's $3.4 billion budget.

Judy Sobin, executive director of the Volunteer Legal Services Corp., called on lawmakers to restore cuts in programs.

"Proposed reductions in funding will force government to reduce and, in some cases, eliminate desperately needed services to citizens," Sobin said.

But Sen. Colleen Hanabusa, Ways and Means vice chairwoman, who supports using a portion of the hurricane fund, said that if the Legislature cannot tap the hurricane fund, programs will have to be reduced.

"I don't think the caucus wants to see more cuts made to programs, but it may come down to the fact that if we can't meet somewhere in between, we may have to do the cuts to balance the budget," Hanabusa said.

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 has been discontinued, and state Republicans have argued that the remaining money should be returned to homeowners.

State of Hawaii

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