Dems see state
tax glass as fullTop legislators say higher
tax revenues in June make
spending cuts unnecessary
Senate and House Democrats continued their political offensive against Republican Gov. Linda Lingle, saying there is no reason for her to restrict funding for social services and education programs, because the money exists to pay for them.
Lingle, however, insists the continued spending by Democrats is no way to restore fiscal discipline to state government.
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"A challenge we face is the Legislature's tax-and-spend approach to government," the governor said yesterday.
Legislative majority leaders -- fresh off last week's rare override special session where they overturned six of Lingle's vetoes -- pointed yesterday to tax revenue collections for June, which showed an increase of $122 million more than the same month last year.
They said the 4.3 percent increase to $317 million for June shows the economy is improving and that major spending restrictions by the governor to cope with an administration-estimated $152 million budget shortfall were premature.
Among such spending restrictions were a $20 million cut to the state Department of Education.
Senate President Robert Bunda (D, Wahiawa) said the increased tax revenues show the Legislature did approve a balanced state budget earlier this year.
House Speaker Calvin Say (D, Palolo) said the tax numbers do not lie.
"Those are real dollars," Say said. "Taxpayers have a right to hear the truth from government officials. And the truth is, the shortfall that the governor talked about does not exist," Say said.
But Fred Hemmings (R, Waimanalo), Senate minority leader, countered that Democrats were dishing out half-truths.
Hemmings said state Tax Director Kurt Kawafuchi, in a tax revenue report for June, attributed most of the increase to one-time spikes in revenue that total about $85 million, which inflated June's figures and will likely result in deflated July totals.
Kawafuchi said late yesterday that tax revenue for the first 15 days of July is already down $36 million, and the state will be hard pressed to make up the shortfall in the remaining two weeks of the month.
Lingle has repeatedly said this week that the state cannot make long-term decisions based on month-to-month projections, and pointed to the state's declining cash balances over the past three years as a sign that state revenues have not kept up with state spending.
The governor lashed out at Democrats, saying they continue to paint a false picture of the state's fiscal condition.
For example, she insisted that the $3.6 million in social safety net programs funded from the state rainy-day fund are for expanded or duplicative programs that the state cannot afford.
"They see it as a pot of money they can use whenever they have a special group they want to give money to without going through the legislative process, without any oversight or review," Lingle said.
