Governor details how he plans to shore up $2.3B budget shortfall
HONOLULU, Hawaii (HawaiiNewsNow) - With tourism at a standstill and other sectors of the state’s economy just hobbling along, Hawaii is facing a multi-billion dollar budget shortfall that the governor says he plans to shore up with a big loan from the US Treasury and budget cuts to state agencies.
It’s the first time Gov. David Ige has offered specifics on how he plans to address the shortfall.
In an one-on-one interview with Hawaii News Now on Tuesday, Ige also talked about the type of jobs he sees emerging in the islands.
With unemployment soaring and jobs limited, Ige says Hawaii residents looking for work should expand their search to remote work on the mainland ― and beyond.
“Businesses have learned that employees don’t have to be at your headquarters,” he said. “They could virtually be everywhere.”
During the pandemic, tele-work has become common place with businesses realizing many employees don’t need to come into an office to do their jobs.
It’s a shift that Ige says has the potential to decrease the state’s dependency on tourism.
Over the next fiscal year, the Council on Revenues projects Hawaii will face a $2.3 billion budget shortfall.
To make up for it, the governor confirms the state will borrow between $750 million and $1 billion from the US Treasury.
“The actual cost to the state is low,” Ige said. “The challenge is the term is very short. We would have to repay the loan in three years.”
The state also plans to substitute bonds for construction projects that were previously funded with cash. “So we’ve identified $300 million of those kinds of projects,” Ige said.
Even with the changes, the state still needs to come up with nearly $1 billion.
The governor says lawmakers plan to make budget cuts to state agencies. He says labor savings would be a last resort ― either through cutting jobs or furloughs.
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