Posted on: Saturday, April 13, 2002

Cayetano says plan jeopardizes contracts

By Lynda Arakawa
Advertiser Capitol Bureau

Gov. Ben Cayetano yesterday criticized the Senate's idea to balance the budget with money in accounts used to pay for service contracts rather than tap the Hawai'i Hurricane Relief Fund.

The Senate this week endorsed the idea of taking money from the accounts after rejecting proposals to use the Hurricane Relief Fund and to increase the liquor tax. Eliminating those two proposals leaves the state budget short by $65 million.

Cayetano explained that while there is money in the "unliquidated encumbrance fund," it is needed to pay for service contracts the state has committed to.

For example, the Department of Accounting and General Services has about 100 state leases that are paid for out of the fund every month and the Department of Human Services needs to tap the fund to pay for a computer system upgrade.

Cayetano said his administration explained the situation Thursday to Senate President Robert Bunda.

"We showed the senator (Bunda) the different contracts that we have pending and many of these contracts cannot be voided, because otherwise we would find ourselves in legal trouble," he said. "Some of this stuff is real common sense and if they had looked a little further, and if they had shared and consulted, perhaps they may have gotten the information correctly, and they did not," he said.

Bunda, D-22nd (Wahiawa, Waialua, Sunset Beach), said he believes there is enough money available.

"I think we could probably take some of these contracts and defer them to a later date or lag them," Bunda said. "There is a different approach in how we use those numbers."

Reach Lynda Arakawa at larakawa@honoluluadvertiser.com or at 525-8070.