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The Honolulu Advertiser
Posted on: Sunday, January 13, 2002

Legislators face challenges

 •  Gambling not strong bet as 2002 session begins
 •  Where legislators stand on the issues
 •  Reach your legislator: State House of Representatives
 •  Reach your legislator: State Senate

By Kevin Dayton and Lynda Arakawa
Advertiser Capitol Bureau

Legislators, especially the ruling Democrats, will find themselves in a quandary when the Legislature convenes for its 2002 session this week.

Lawmakers like to play it safe in election years, avoiding tax increases and other measures that might anger voters or important special-interest groups. But in recent years, the voters seem inclined to punish timid behavior, and reward lawmakers when they take risks.

And there appears to be considerable public support for decisive action on the issues of public education and the state economy.

But lawmakers believe Hawai'i's economic jam is largely out of their hands, triggered by the acts of international terrorism on Sept. 11, and by a recession that is keeping Asian and Mainland tourists away. With state tax collections slowing, they say they can't give more money to the public school system.

"I do not envy them at all," said former state Rep. Jim Shon, a Democrat who was voted out of office in an early spasm of anti-incumbent sentiment in 1996. "There's not a one of them who wouldn't want to come up with the bold solution for Hawai'i that would win them the Nobel Prize, but it's not easy."

Critics said the Legislature should have done more in 1996 to fix problems with the state's no-fault insurance system, and some branded it a "do-nothing" session. Six months later, the House Republicans gained five seats in the election.

In 2000, Gov. Ben Cayetano and others berated the Legislature for failing to "reform" government by reducing the cost of public employee fringe benefits. House Republicans gained another seven seats that year.

By contrast, in 1998 legislators approved the largest tax cut in state history. Despite predictions that the Republicans would make huge gains, Cayetano narrowly won re-election, and the Democrats held their ground in the Legislature.

"Voters are more aware nowadays of what we do and don't do," said Rep. K. Mark Takai, D-34th (Waimalu, Newtown, Pearl City). "I think it's reasonable to assume that what people may consider to be a productive session results in a productive year at the polls."

State Rep. Charles Djou, R-47th (Kahalu'u, Kane'ohe), said the state needs to use privatization to shrink state government, and needs to shift power to the counties. But he worries that the upcoming session will be more "smoke and mirrors" than substance.

"Knowing the past history of the Legislature, I think the general tendency is to punt rather than make those difficult choices," Djou said.

Much of the upcoming session, which opens Wednesday, will be consumed by unglamorous efforts to balance the budget, which must be done to offset the projected drop in tax collections.

Senate Vice-President Colleen Hanabusa, D-21st (Kalaeloa, Makaha), said the state's tough economic situation limits the options.

"The main problem that I see is that we don't know what the financial situation is going to be," she said. "So the problem for this session may be that the Legislature may not have choices as to some very unpopular decisions such as (using money from) the Hurricane Relief Fund."

Cayetano has proposed doubling the state's liquor tax and spending the $213 million surplus in the Hawai'i Hurricane Relief Fund to help him balance the budget.

Those are prime examples of the kinds of things lawmakers like to avoid in an election year. Tax increases are never popular, and legislators said many of their constituents want the state to return the hurricane surplus to the residents who paid into the fund through their homeowners' insurance premiums.

Cayetano has little sympathy.

"You have to play with the hand that is dealt you, and it would be nice if this was next year, but it's not, it's this year. So we say, OK, you don't want to do an alcohol tax (increase), then find an alternative," he said. "These guys should have the guts to do their job even if it costs them their job, because the times require it."

Addressing the sluggish state economy will be foremost on the voters' minds, but repairing an economy heavily dependent on visitors is not so simple, said Hanabusa said.

"We've funded in terms of advertising, (the Hawai'i Tourism Authority), all these guys, but you can't get people to want to come here," she said. "Our problem is that we're an economy based on tourism and government spending and people don't want to see this government spend. I don't see anything else other than cuts and trying to somehow persuade the feds to increase their spending and miraculously get tourists coming back. I don't see how we're going to be able to do anything immediate."

Cayetano has proposed borrowing and spending another $900 million on state construction projects, and calls that the "centerpiece" of his economic revitalization effort because it is the only initiative that directly creates large numbers of jobs.

Lawmakers have balked at this before and some said they probably will reject it again because they are worried the state may go too deeply into debt.

House Majority Whip Brian Schatz said the voters "expect big things" from the Legislature, but are also realistic about what can be done. To him, that means the Legislature should focus on education as the best chance for long-term economic development.

"There's a growing understanding that our current economic woes are part of what's happening globally, so what I have been hearing is a desire for us to do something about those things we can change, and not just posture about those things that we can't do anything about," said Schatz, D-24th (Makiki, Tantalus).

Education reform is already well-traveled ground for the Legislature, and Schatz said the voters will only give credit for meaningful change. Schatz said he plans to propose ways to reward principals and schools that perform well, and to expand the powers of the state schools superintendent.

"We tend to go through the motions so that we can run on having reformed the system just one more time, but people are wise to that now and they are demanding real improvement in our education system," he said.

Senate Education Chairman Norman Sakamoto, D-16th (Moanalua, Salt Lake), said he wants to continue upgrading school facilities, increasing accountability, and possibly change the way Board of Education members are selected.

He said lawmakers are building a foundation, citing work by the Legislature that includes laying the groundwork for the privatization of some public jobs, lowering taxes and dealing with the backlog in repairs and maintenance in school buildings.

"Taken separately people may say, 'Oh well,' but put it together I think we're building a future," he said. "I think people understand you can't do everything in one year."

Reach Kevin Dayton and Lynda Arakawa at kdayton@honoluluadvertiser.com or larakawa@honoluluadvertiser.com or 525-8070.