Scrutinize state budget to preserve promised income tax cuts

by Joe Kent, Grassroot Institute, March 18, 2026

Gov. Josh Green has proposed balancing the state budget by pausing the historic income tax cuts he signed into law in 2024.

But rather than call on residents to open their wallets, lawmakers should look for spare change in the state budget itself. Doing so is sure to turn up enough funds to cover state expenses.

For starters, the state has many special, revolving and trust funds that support various departments and agencies. Some of these funds serve legitimate purposes — such as holding gas tax revenues to be used for road and bridge repairs — but others do not.

The state Office of the Auditor has actually identified many funds that aren’t being used properly, and returning that money to the general fund should be a top priority for lawmakers.

Many special funds also hold millions of dollars that go unused year after year, collecting dust while taxpayers try to defend their hard-earned cash from tax hikes.

In the upcoming budget year, the state expects to have more than $5 billion sitting in all of its special, revolving and trust funds. No doubt, lawmakers could find a couple hundred million dollars among them to use for other purposes.

The Legislature could also redirect an additional few hundred million dollars by axing chronically unfilled state jobs. Currently, roughly $350 million in general funds is earmarked for more than 4,200 vacant positions. Abolishing only half of those would save millions of dollars without having to let go of any active state employees.

The Legislature should also scrutinize departments and agencies that have seen their budgets jump dramatically in recent years. It is not uncommon for legislators to automatically increase budget line items from year to year without first considering whether past increases should have been a one-time expense. 

For instance, the Public Works Division in the state Department of Accounting and General Services operated with 16 employees between 2016 and 2018, but in 2019 the number of employees jumped to 91 with $10 million in additional annual expenses — without any explanation given in then-Gov. David Ige’s budget request. The division’s staff and payroll has only gone up since.

Last but not least, Hawaii lawmakers should consider repealing programs that could be more efficiently run by the private sector.

A good place to start would be abolishing the Hawaii Tourism Authority, which the governor’s office has proposed funding with $66 million in the fiscal year 2027 budget.

Hawaii’s hotels, resorts, airlines and tour companies are more than capable of paying for their own marketing campaigns, so abolishing the HTA would be a win for Hawaii taxpayers in general and residents who complain that the state puts too much focus on the visitor industry.

It’s clear that going through the budget with a fine-toothed comb is long overdue, and it would likely net more than enough savings to preserve our tax cuts.