State of Hawaii

Cayetano to OK
spending plan

He overcomes initial misgivings
about the $3.6 billion budget's
impact on programs

Vetoes loom for Ko Olina tax breaks,
bill on disabled

By Richard Borreca

Gov. Ben Cayetano said he will approve a new state budget plan that uses only a small portion of the $213 million hurricane relief fund that he had contended was vital to balancing the budget.

Cayetano, who previously said he thought the $3.6 billion general operating fund budget would take too much away from services for the poor and needy, said yesterday that he will not veto the measure.

After asking the 18 state departments for their views on the budget, Cayetano said only the departments of Hawaiian Home Lands and Taxation raised concerns.

"It appears that most of the funding for the social services that appeared to have been cut, has been restored," Cayetano said.

Senate President Robert Bunda, who had objected to using the entire hurricane fund to pare down the $315 million budget deficit, said Cayetano is right to approve the budget.

"I think he realizes that we balanced the budget without having to dip into the hurricane fund, and he realizes we did a good job," Bunda said.

To balance the budget, the Legislature used $29 million in interest from the hurricane fund, cut $140 million from state special funds, and took another $10 million from the state rainy-day fund.

Speaker of the House Calvin Say added that the budget passed last week by the Legislature included the recommendations of all of Cayetano's departments, so he had been confident that the governor would approve it.

Those who had voted against the budget were disappointed that Cayetano would approve the budget.

"The governor had the opportunity to make the statement that we wouldn't approve of this smoke and mirrors budget," said Rep. Charles Djou, (R, Kaneohe). "I feel the budget was put together with Band-Aids and it will just cause further headaches."

Bunda said he had his own concerns about how next year's budget will hold up.

"Next year will be much more challenging," Bunda said. "If the economy does not pick up and the Council on Revenues tell us our spending has to be down ... you will absolutely have to cut programs."



Vetoes loom for Ko Olina
tax breaks, bill on disabled

Associated Press

Gov. Ben Cayetano said yesterday he is inclined to veto $75 million in tax credits toward development at the Ko Olina resort in West Oahu.

Jeff Stone, managing partner of the Ko Olina Co., the master developer, said the tax credits would allow construction of a resort complex of hotels including a world-class aquarium, a mammal training center and sports facilities.

Stone said the tax credits would attract private financing for the project that would create as many as 23,000 construction jobs and 10,000 permanent jobs and generate about $60 million in annual tax revenue.

Opponents raised concerns over the fairness of earmarked tax breaks and whether the development might be a precursor to gambling.

State Tax Director Marie Okamura expressed concern that the generous tax credit would benefit an exclusive group of taxpayers.

"I have been asked to listen to a briefing by the proponents of the Ko Olina tax credits and I will reserve judgment until I've had that briefing," Cayetano said yesterday. "If I had to make a decision today, I would veto it, but I have not had that briefing yet so I'll sit down and listen to what they have to say."

One measure the governor said he will veto is one to lower the minimum fine for parking illegally in stalls reserved for handicapped motorists.

Francine Wai, executive director of the state Disability and Communication Access Board, called the legislation "a slap in the face" to the disabled community. Jim Santos, commander of the state chapter of the Disabled American Veterans, urged Cayetano to veto the bill.

The measure reduces the minimum fine from $250 to $100. A judge could impose a maximum fine of up to $500.

"I'm sure it was not the intention of the Legislature to reduce the fines, but I think the bill has more of a symbolic impact on handicapped citizens than anything else," Cayetano said. "The reaction and the response from the handicapped community has been one of dismay and despair and I don't think we need to change that law, so I'll veto that bill."

State of Hawaii

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