It's a year of tight money in Legislature

The Maui News
Sunday, January 13, 2002

By ILIMA LOOMIS
Staff Writer

HONOLULU — With Hawaii and the nation officially in a recession this year, state lawmakers embarking on the 2002 legislative session will be hunting for "creative" ways to balance the budget, key Maui legislators predict.

But they disagree on how to accomplish that end, with some calling for improved government efficiency, others predicting across-the-board spending cuts, and others urging deep cuts in selected areas.

Legalized gambling will be an issue, and while many lawmakers express personal opposition to gambling, some want to put the issue before voters in a referendum.

Other issues, such as capital improvement projects, traffic cameras and education, will also be major issues this session but will probably stay in the background while legislators struggle with the budget.

"It's going to be a budget year," said Rep. Joe Souki, whose district includes parts of West Maui, Waihee, Wailuku and Maalaea.

The state Legislature's 2002 session will begin Wednesday and run through May 2.

Gov. Ben Cayetano submitted his Budget in Brief to legislators last Wednesday, outlining his proposal for balancing the budget this year.

It included 1 percent cuts to all state departments for fiscal year 2002 and 2 percent cuts in fiscal year 2003. It also proposed spending an additional $900 million on public construction projects, of which $255 million would go to school repairs; increasing the state liquor tax and cutting capital gains taxes; and drawing upon money currently in the Hawaii Hurricane Relief Fund.

Sen. J. Kalani English, whose district includes portions of Kahului, Wailuku, Paia and Upcountry Maui, predicted that the coming session would be a "watershed" year, with changes that will have long-term effects throughout the state.

"There's much more free thought and debate at the legislature. There's a lot of really, really great ideas coming out, and people are understanding that it'll take some time. It's not the quick fixes," he said. "With that combination we can expect some pretty creative things coming out of the Legislature."

Those creative energies will probably be focused in one main direction.

"It's the economy, it's the economy, it's the economy," said Sen. Avery Chumbley, summing up what he considers the three major issues of the session. Chumbley's current district is split between two counties, including South Maui and East Maui with North Kauai. 

With tax revenues lower than anticipated, budget cuts will be inevitable, said Chumbley, who doesn't support increasing taxes this year. He called for targeted cuts and said monies awarded to nonprofit service contracts will probably be the first hit.

All Neighbor Islands will feel the effects of the cuts, especially in social service areas, he predicted

"It's time for legislators to have the courage to make some tough choices. The day of 1 percent cuts across the board are no longer acceptable," he said.

While he favors spending money on capital improvement projects, he expects cuts to the operating budgets of certain departments and programs, especially social services.

English agreed with Chumbley's call for targeted cuts.

"There will be budget cuts. I think it will be more precision-type cuts than across-the-board, and I think everything will be on the table," he said.

But he cautioned against cutting social services.

"We don't want to touch human services because they were so hard hit in the last round that there's really not much left," he said. "Some things that haven't been cut and are on the table are education, especially the administration side of education."

Chumbley noted that legislators don't have much flexibility in looking for places to cut because they are limited to discretionary funds. A large part of the state budget is dedicated to fixed costs such as salaries for teachers and other state employees.

While legislators can't cut costs by reducing those salaries, they can save money by changing the number of employees for whom salaries are budgeted, especially if not all the positions have been filled.

"That's one of the ways we always talk about reducing the budget, by eliminating vacant positions, and that's one of the more humane ways of doing it, because you're not affecting warm bodies," he said.

Souki echoed the need for budget cuts but predicted that all agencies would get a trimming.

"There's going to be budget cuts, and right now the plan is to be right across the board," he said. "There aren't going to be any sacred cows."

He predicted a 4 percent or 5 percent across-the-board cut, and said Maui would likely feel the effects in its environmental programs and in spending on higher and lower education. Cutting state employees would not be enough to balance the budget, he said.

"Even if you furlough you're not going to get enough money, because there are some people you cannot furlough," he said. "We're understaffed in the prisons already, and imagine not having a teacher in class!"

Souki agreed that "as general funds become scarcer they're going to be looking more at capital improvements," and said Maui had a number of projects that should be funded, such as the Lahainaluna Recreation Center and highway projects.

"For Maui, what we need to do is make sure we get the matching funds for that highway from Haliimaile to Kihei," he said.

Other lawmakers called for a reassessment of government operations.

"I'd like to see more government efficiency and reform — duplication, waste, consolidation — versus simply cutting positions," said Sen. Jan Yagi Buen, whose Senate district includes Souki's Wailuku-West Maui district plus Molokai, Lanai and Kahoolawe.

She pointed to a report by the Legislature's Felix Investigative Committee, which found mismanagement of funds spent on special education under the Felix Consent Decree, as an example of government waste.

She said she opposed cuts in services to education and public health, and that she would consider cutting some special funds if it does not result in loss of federal money.

Rep. Chris Halford, who represents Kihei-Makena-Ulupalakua-Kulaone and is one of three Maui Republicans in the Legislature, also called for efficiency.

"What I'm hoping for is accountability in our current spending," he said. "We're very inefficient in our spending. We squander resources through poor management. We don't account for how money's used."

He said measuring the output of programs and accounting for the money put into them would free enough money in the current budgets to avoid cuts to services. In particular, he pointed to the highways division as a state agency that needed to be held more accountable for its use of money.

Halford was adamantly opposed to legalizing gambling in Hawaii, adding that it is an emotional issue that has been overplayed, distracting from more important issues.

"This proposal this session will be dramatic, and it is a red herring issue, designed to distract from substantial issues regarding poor management of our public money," he said.

The amount of revenue that could be raised through gambling would be insignificant compared with the problems it would create, he said.

"We spend $7 billion a year in the executive budget. The amount of revenues proposed to our state through legalized gambling is about $70 million, or 1 percent," he said.

English also said he was opposed to the gambling proposal, and echoed Halford's statement that it has been overplayed as an issue.

"We're so tired of this. There's such a hype on it," he said. "In the Legislature there's very little support for it."

To put the issue to rest once and for all, senators are planning to propose a constitutional amendment to prohibit legalized gambling in the state, he said.

Others favored a proposal to submit the issue to voters in a referendum.

"I would like to let the people decide," said Yagi Buen. "Put it on the ballot and let everyone learn the pros and cons of this very important issue."

Chumbley said he personally opposed legalizing gambling but would support a referendum.

"I think the idea of doing a nonbinding referendum may be a way to put some of this issue behind us as a state," he said.

Souki also supported the referendum idea but doubted it would happen.

"I would like to take the issue to the voter, but even that I don't think it is going to pass," he said. "There's a feeling among many of the members that they don't like gambling per se."

Rep. Kika Bukoski, a freshman Republican who represents Puunene, Paia, Haliimaile, Pukalani, Makawao, Olinda and Kula, was one of those who would not support a referendum on the issue.

"We have been elected by our constituents to make these hard decisions. I view a referendum as a cop-out and an unwillingness to confront difficult issues," he said.

He said he is opposed to legalizing land-based gambling.

High on the list of issues Bukoski sees as important are traffic cameras, which he hopes to keep from being introduced on Maui.

He proposes limiting traffic camera surveillance to Oahu, revising the payment system to a flat fee, lengthening yellow lights and re-examining speed limits, and setting the cameras' threshold at 10 miles per hour above the posted speed limit.

He also said the question of how the state will treat the Hurricane Relief Fund and long-term adult care would be important issues affecting Maui County in the upcoming legislative session.

Yagi Buen listed several projects as her priorities for Maui, including school repairs, a new parking lot for Maui Memorial Medical Center and funding for state roads on the island. She also called for more support to diversified agriculture, including improvements to irrigation ditches, agricultural tourism and a "world-class farmers market."

Chumbley suggested developing a business-friendly climate by addressing the many rules and regulations imposed on businesses by the state.

"I think we have to step back and say, why do we have some of these regulations in place, and who are we trying to protect?" he said.

English called for continued funding to the state's emergency environmental work force — a program created in an emergency special session last October to offset jobs lost since Sept. 11 — and capital improvement projects.

"I'm really keen on infrastructure items," he said. "You can't have that kind of sustained growth that's not dependent on tourism without the proper infrastructure in place."

He pointed to Upcountry water lines, highway repair and an expansion of Hale Makua as examples of projects he thinks ought to be maintained rather than cut, as Cayetano has proposed.

"I'm going to be very diligent in trying to replace them and put them back in the budget," he said.

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