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Thursday, March 12, 2009
Governor Lingle: "balance budget without raising taxes or laying off"
By News Release @ 7:19 PM :: 7638 Views :: Energy, Environment

HONOLULU – Governor Linda Lingle issued the following statement today regarding the Council on Revenues’ reduced revenue forecast.

The Council on Revenues’ lower revenue projections reflect the continuing impact the national and international economic conditions are having on our state’s economy.

My Administration will evaluate this latest forecast by the Council and will present a detailed financial plan to the Legislature in the coming weeks.

Over the past several months, my Administration has been working cooperatively with the Legislature to close a growing budget shortfall to ensure we meet our legal obligation to enact a biennium budget and six-year financial plan that does not result in a deficit at the end of the fiscal year. 

Because I have also met with and will continue meeting with union leaders, the counties and my cabinet, as well as social service agencies and other organizations in the community, the process of developing a new financial plan takes time, but I believe it is time well spent.

I remain committed to balancing the budget without raising taxes or laying off employees.  Either of these actions would further weaken our economy.

Last week I submitted a balanced financial plan to the Legislature that closes the $650 million revenue shortfall for the remainder of fiscal year 2009 and fiscal years 2010 and 2011, based on the Council on Revenues’ January 9 forecast.  This common sense plan balanced the budget without raising taxes, without any layoffs or furloughs of state employees, and without making significant cuts to essential public services or programs. When I submitted this plan, I recognized that we would likely need to make adjustments to account for today’s Council on Revenues forecast.

This plan was in addition to the plan I recommended to the Legislature on January 27 to address the $81 million shortfall for FY09, as well as the FY10-FY11 biennium budget and balanced six-year financial plan I submitted in December which included a detailed plan to make up for a projected $1.1 billion revenue shortfall.

The plan submitted last week incorporates $320 million in Medicaid reimbursement funds from the federal stimulus package.  We are working to take maximum advantage of the federal stimulus funds that are available to Hawai‘i.  However, the federal stimulus funds are not recurring funds and therefore we cannot rely on them to solve all our revenue challenges.”

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ANALYSIS:  (It's going to be either taxpayers, tax break beneficiaries, employees, or state contractors who take the hit.  Some Legislators are protecting their contractors/campaign contributors and trying to raise possibility of layoffs as leverage for tax increases.  See below...)

RELATED: Advertiser coverage  "State House Speaker Calvin Say, D-20th (St. Louis Heights, Palolo Valley, Wilhelmina Rise), said it is up to the governor to present her plans for this fiscal year before lawmakers deal with the two-year budget.

The House Finance Committee has approved a budget that uses a combination of spending cuts, state worker layoffs, and tax increases to balance the two-year budget. The draft is expected to move to the state Senate next week.

State Sen. Donna Mercado Kim, D-14th (Halawa, Moanalua, Kamehameha Heights), the chairwoman of the Senate Ways and Means Committee, said the governor's previous budget proposals have not added up. "She has to tell us what her balanced budget is," Kim said.

(Hmmmmm...what about Act 215/221 ???)

Star-Bulletin: State revenues projected to fall an additional $260 million

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