Hawaii Lawmakers OK $11.2B State Budget

The state House and Senate gave final approval to an $11.2 billion budget and a $3.2 billion outlay for capital improvement projects, taking measured steps to restore money cut from programs during the recession while investing in construction intended to prod economic recovery.
by | May 4, 2012

By Derrick DePledge and B.J. Reyes

The state House and Senate gave final approval Thursday to an $11.2 billion budget and a $3.2 billion outlay for capital improvement projects, taking measured steps to restore money cut from programs during the recession while investing in construction intended to prod economic recovery.

The supplemental budget came in slightly higher than what Gov. Neil Abercrombie requested in December and later than anyone at the state Capitol can remember. The budget contains more money next fiscal year for health care for the poor, for welfare and a student spending formula to reflect enrollment increases at public schools.

Lawmakers also made down payments on Abercrombie's initiatives for early childhood education, watershed protection and criminal justice reforms while giving the new chief information officer the resources to start an overhaul of the state's outdated technology footprint.

The compromise on state construction -- the issue that delayed the budget -- produced the $3.2 billion outlay, which includes $825 million in construction financed by general obligation bonds. Abercrombie had asked for a $300 million increase in bond-financed construction.

Sen. David Ige (D, Aiea-Pearl City), chairman of the Senate Ways and Means Committee, said the session was the first break from the billion-dollar deficit projections of the recession. He said the budget "moves the state forward by protecting safety net services, strengthening funding for education and making strategic investments that will advance our economy."

Rep. Marcus Oshiro (D, Wahiawa-Poamoho), chairman of the House Finance Committee, said lawmakers sought to prioritize instead of reflexively returning to the same spending patterns before the economic downturn.

"I fear there are still those who believe that any resources available should be spent simply to return to the status quo," he said. "To spend money simply because we can or to restore programs that were cut in the past four years without evaluation and assessment of return on investment or outcomes is simply not the right thing to do."

On the last day of the 60-day legislative session, the Senate approved a bill that would establish a regulatory framework for an interisland electric transmission cable that could move energy between the islands. The bill is among Abercrombie's priorities, but intense opposition from residents on Molokai and Lanai and doubts among environmentalists about whether such a project is necessary to achieve the state's energy goals made lawmakers apprehensive.

"This is a long-term infrastructure investment that is needed now," Abercrombie said in a statement. "An integrated grid will stabilize energy prices and equalize rates between the islands, which will benefit all of us. As I mentioned at the start of the session, there is no legislation more critical to our future."

While senators stressed that the bill does not require the construction of an undersea cable, it was approved only after a splintering floor debate where critics asked whether the state was committing to a $1 billion project that could burden consumers and threaten native culture and the environment.

"Any suggestion that this is pono I find offensive. Actually I find that tragic, not offensive," said Sen. Clayton Hee (D, Kahuku-Kaneohe).

The Senate, without comment, shelved a bill that would have set unique planning guidelines around bus and rail transit stations as Honolulu moves toward a $5.27 billion rail project. The bill, which originally included several environmental and regulatory exemptions, became a focal point of criticism from community members and environmentalists who contended the bill would close off opportunities for public participation. The House followed the Senate and also discarded the bill.

Sen. Donovan Dela Cruz (D, Kaena-Wahiawa-Pupukea) said he believed the bill would help preserve agricultural land and open space on Oahu by directing development into the urban core around rail stations.

Senators unexpectedly revived a bill that would extend an increase in a rental car surcharge through June 2016. The bill would help finance $500 million in revenue bonds for new rental car facilities. A portion of the surcharge was diverted this year to help with the budget deficit, and state Budget Director Kalbert Young had wanted to continue to use some of the money to stabilize the state's finances.

But because negotiators could not agree on a final version in conference committee, the bill was left incomplete. Senators chose to pass the bill anyway rather than let it die.

(c)2012 The Honolulu Star-Advertiser


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