Cayetano says Case
plan lacks specifics

The governor says the proposal
seems difficult to implement

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By Pat Omandam
pomandam@starbulletin.com

Gov. Ben Cayetano says Democratic gubernatorial candidate Ed Case's proposal to deal with the rising cost of state government lacks specifics.

He also said the plan would result in significant cuts in state services because it rules out tax increases as well as the use of special funds to balance the state budget.

"It would seem difficult to implement the Case plan and still deliver the level of services we now offer. ... Under the Case plan, significant reductions in government services andor elimination of programs would be required to balance the state budget," Cayetano said.

Case responded, "I simply disagree with the governor's apparent conclusion that we have no choice but to raise taxes or raid funds."

Cayetano continued his "frank evaluations" of budget plans from gubernatorial candidates, which he started three weeks ago when he directed Cabinet officers to review the budget proposals of Republican gubernatorial candidate Linda Lingle.

Hawaii Republicans filed a complaint Aug. 5 with the State Ethics Commission alleging that Cayetano misused government employees, resources and time.

Cayetano said he welcomed an ethics investigation and said the state spent $400 to review Lingle's plan.

Cayetano e-mailed the critical evaluation of Lingle's plan to Case, Lt. Gov. Mazie Hirono and D.G. "Andy" Anderson, the three major Democratic candidates for governor and also held a news conference.

Hirono's campaign chairman, Bob Toyofuku, said last night that Hirono received the Case critique via the state's e-mail system. Anderson said last night that he had not received the critique at home and was not sure whether one was sent to his campaign headquarters.

Lloyd Yonenaka, Lingle campaign spokesman, said, "(The governor) has not sent it to us."

Cayetano said the first part of Case's multipart plan, "Blueprint for Real Change: Living Within Our Means," pledges to keep significant tax cuts in place, while it precludes the use of the $200 million in the Hawaii Hurricane Relief Fund.

State tax revenue figures released last month showed an $88 million shortfall from projected revenue, forcing the outgoing Cayetano administration to look at ways make it up. The Case plan would recoup the shortages by cutting expenditures, extending tax cuts and through attrition.

Cayetano attended a planning conference in Denver this week and, following a few days of personal vacation, will return to Hawaii on Sunday. Cayetano said in a release yesterday that 53 percent of the state budget is devoted toward education and higher education, and attrition would not provide the savings sought.

The governor explained attrition has been partially practiced since 1995 and, even if all 2,000 currently vacant state positions were eliminated, it would yield a payroll savings of only $55 million. Also, the state is in this budget situation due to lower state revenues that resulted, in part, from large tax cuts, he said.

Case, in response, said he welcomed the governor's analysis of this first part of his blueprint and hopes he reviews the rest. Case said both he and the governor acknowledged the state's worsening budget crisis, and their differences are on how to address them.

For example, Case disagreed with Cayetano's efforts to use the hurricane fund to balance the budget, something the governor proposed earlier this year. The controversial issue was hotly debated by the state Legislature until lawmakers reached a compromise plan that skimmed the interest from the fund while leaving its base intact.

Case, a Manoa state representative, said the use of attrition was just one component of his plan, but there are savings to be had from future attrition and vacancies as they arise. Every dollar counts, he said.

"Using all the tools at our disposal, I'm convinced we can creatively balance our state budget by controlling costs and increasing efficiencies over the next 2 1/2 years while retaining core government functions," he said.

"Difficult, yes, but impossible, absolutely not."