Abercrombie says new budget will make immediate impact without raising taxes

HONOLULU -– Gov. Neil Abercrombie’s version of the Supplemental Budget for Fiscal Year 2013, submitted yesterday, requires an additional $35 million in general funds—overall changes included an increase of $119.9 million in spending in some areas and $85.9 million in savings in others.

To view the entire budget in brief proposed by the governor, click here

“One year ago we faced a daunting $1.2 billion deficit forcing us to make tough decisions to rebuild our fiscal situation,” Abercrombie said in a statement. “Now, I submit this budget, which is in the black, for the Legislature’s consideration to build on our New Day agenda, which will result in stimulating the economy and creating jobs.”

Abercrombie said the main objectives of the budget are to restore the safety net of the Hurricane Relief and Rainy Day funds, provide for education, maintain essential services, and pay for initiatives set forth in his New Day plan without relying on tax increases.

The Governor’s Budget proposes to restore $174 million to the Hurricane Relief and Rainy Day funds during through 2013 with $75 million in the current fiscal year. The effort would be funded by premiums buyers paid to the State in the recent sale of its highly-sought bonds. On December 1, that the State sold $1.28 billion of General Obligation Bonds.

The Budget also includes additional Capital Improvement Projects (CIP) that would require another $300 million of General Obligation Bonds. The CIP projects address critical infrastructure needs that are shovel-ready and will provide the most immediate impact and job creation, Abercrombie said.

General Fund adjustments for Fiscal Years 2012/2013 include:

* University of Hawaii—$20 million was added to continue American Recovery and Reinvestment Act (ARRA) expenditure levels at UH Community Colleges and UH Hilo as well as for “strategic outcome funding” at other UH campuses.

* Department of Transportation—$1.6 million was added for debt service costs at the Harbors Division. An additional $80 million goes to the Highways division for the special repair and maintenance projects program.

* Department of Taxation—Nine permanent positions were added at the Information Technology and Services Office, costing $1.1 million. Another additional $185,000 went toward the Multistate Tax Commission audit reimbursement fee, $250,000 to the Tax Review Commission.

* Department of Public Safety—21 new deputy sheriff positions were added for the Kapolei Court Complex at a cost of $1.6 million. Twelve new adult correction officer positions will receive $525,506, and $442,482 go toward six other new positions for the re-entry work furlough program at Waiawa Correctional Facility. An additional $1 million will restore the department’s vehicle replacement program. And another $5.1 million will increase the expenditure ceiling for Hawaii Correctional Industries.

* Department of Land and Natural Resources—24 new positions were added at a cost of approximately $3.3 million as well as $6 million in interdepartmental transfer funds to address operational deficiencies at various divisions. $1 million was reduced for the State Parks division to fund the Dam Safety Program, while $1 million was added for the programs operating expenses.

* Department of Human Services—$11.5 million was added for Temporary Assistance for Needy Families (TANF) and Temporary Assistance for Other Needy Families (TAONF) programs. $3.2 million, and three new positions, were added to the Homeless Services Program Branch for salaries and outreach/shelter contracts. $3.2 million will fund the Pre-School Open Doors program with only general funds. Six new positions costing $2.9 million help to fund a new computerized eligibility system for the Medicaid program. Medicaid funding was reduced by $75 million to reflect reductions in Medicaid benefits. And $13.2 million were added to restore medical benefits for the Compact of Free Association clients, in accordance with a federal court injunction.

For a full summary of departmental budget adjustments, click here

“It will take time to restore faith in government but we are working hard to make things right and move Hawaii forward,” Abercrombie said. “We now have a clear understanding of our finances and have established unprecedented collaboration to initiate projects that have immediate impact and solve various issues including ‘homelessness,’ education, and social services.”