Lingle warns
state can’t afford
pay raises

Rep. Calvin Say says he thinks
the state is bound by law to pay

Gov. Linda Lingle talked yesterday about state pay raises.

Republican Gov. Linda Lingle is warning that the state budget will be seriously unbalanced if the Democrat-controlled Legislature approves pay raises for white-collar public workers.

"We can not afford this award," Lingle said. "We are living beyond our means."

Lingle made the rounds of legislative leaders and the news media yesterday to spell out her objections.

"If the legislators insist on their approach, which is to accept the award, they will have to find an extra $100 million a year. We think we need to get a jump on this now," Lingle said.

The state needs to expand services and take better care of existing programs, Lingle said. This can't happen if extra state money is dedicated to state employee pay raises, Lingle argues.

"Look at the condition of state parks. It is pitiful. People want increased drug treatment and small class sizes in the schools," Lingle said, giving examples of how extra state money could be spent.

In a one-hour presentation yesterday at the Star-Bulletin, Lingle warned that if the Hawaii Government Employees Association wage settlement is approved, and if blue-collar workers and school teachers get a similar raise, the state will have to make up an extra $73 million next year.

She said the pay raises would continue to ripple through the budget until by fiscal year 2007, the state would have a $296 million deficit.

"We just can't afford it. ... It is not an issue of balancing the budget this year. It is a question of how you can sustain it over the years," Lingle said.

Lingle promised to give the Legislature a detailed list of cuts to the budget, design an increased raid on state special funds, refinance construction bonds and aggressively enforce state tax laws to balance the budget in future years.

In response, Democratic leaders say the arbitrated HGEA awards are an obligation that the state must honor.

"Personally, I think we are bound by the law. I think we have to fund it," House Speaker Calvin Say said.

The arbitration award was fair and the state was hampered "by a poor presentation," Say added.

"I think if the state gave a more solid presentation, the employer (the state) would have prevailed," Say said.

Lingle said the arbitrator who awarded the HGEA an average 8 percent pay raise over two years disregarded or misinterpreted state financial information.

For instance, Lingle said, the arbitrator, Catherine Harris from Sacramento, Calif., calculated a $972 million fund balance in the last fiscal year as money that would be available to the state, whereas actually it was money that had to remain in airport, harbor and unemployment funds for other purposes, she said.

Sen. Brian Taniguchi, Ways and Means Committee chairman, said the state can afford the wage settlements by revising the state's $3.6 billion state budget.

"Most of the members of the Legislature are clear that it is something we need to do," Taniguchi said about the HGEA settlement.

To pay for the raises, Taniguchi said the state can take money from the rainy day fund and special funds.

"We can also take a second look at the $120 million in the governor's new requests," Taniguchi said.

Besides the HGEA award, the state must also fund the University of Hawaii of Hawaii Professional Assembly award, which is estimated to cost an additional $10 million through fiscal year 2005, but will balloon to an extra $51 million by fiscal year 2009.

HGEA spokesman Randy Perreira, deputy executive director, said Lingle has made a "tremendous commitment" to the UH faculty, but is inconsistent in not wanting to also pay for the HGEA award.

"To say it is suddenly unaffordable is shibai," Perreira said.


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