Legislature Approves Budget, Poised to Override Vetoes - Hawaii News Now - KGMB and KHNL

Legislature Approves Budget, Poised to Override Vetoes

Senator Sam Slom Senator Sam Slom
Senator Colleen Hanabusa Senator Colleen Hanabusa
Senator Will Espero Senator Will Espero
Senator Josh Green Senator Josh Green

By Ben Gutierrez - bio | email 

HONOLULU (HawaiiNewsNow) - With just three days left in the current session, state lawmakers were able to pass a budget that is balanced, although barely so. And some of Gov. Linda Lingle's vetoes may complicate matters if the legislature fails to override them later this week.

The lawmakers approved the $10.2 billion budget by a nearly unanimous vote. But it included a shortfall that would have to be made up through a wide variety of tax and fee increases that are included in other measures. And that didn't sit well with the one lawmakers who voted against the budget.

"It increases spending. It's built on additional taxes and fees that everybody here's going to have to pay for," said Sen. Sam Slom (R-Hawaii Kai, Aina Haina, Kahala, Diamond Head). "And more importantly, it doesn't make any systemic changes to what brought us to this crisis in the first place.

But Senate President Colleen Hanabusa said she expected many of these measures to be temporary.

"I'm counting on the economy picking up, construction picking up, the stimulus working and all those other assumptions," Hanabusa said.

For now, the State Council on Revenues is predicting negative tax revenue growth of two point five percent for this fiscal year. And last month, it lowered its projected revenue growth from 7.6 percent to just six percent for fiscal year 2011.

Hanabusa looks at those figures as assumptions, but assumptions that are always considered when putting the budget together.

"Is the council correct?" Hanabusa said. "Is it really going to be that bad? Or assumption that we make, like the governor makes in how to balance her budget, how real are all of those? And that's always going to be an issue."

Besides some taxes, the senate also voted to raid surpluses in what are supposed to be special funds, earmarked for specific purposes.

"The other big thing is the raid on the rainy day fund, the raid on the hurricane relief fund, and other special funds as well," Slom said, "So you're basically shifting money around."

In all, senators approved raiding surpluses in 25 special funds, including money from recycling, the Hawaii Convention Center, Aloha Stadium and the Hawaii Tobacco Settlement special funds. Senate Ways and Means Committee chair Donna Mercado Kim said that would make up $46 million of the budget shortfall.

The senate also voted, 14-11, to temporarily repeal a tax credit that has been given to high-tech businesses in Hawaii since 2001. The repeal would be for three years.

Meanwhile, Gov. Linda Lingle, in California for a meeting, vetoed a $1 hike per barrel of petroleum that would raise $22 million.

Senate president Hanabusa said she believes there are enough votes in the senate to override Gov. Lingle's vetoes.

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