House OKs tapping hurricane fund of $100M

By Kevin Dayton
Advertiser Capitol Bureau Chief

A plan to spend $100 million from the state hurricane fund won preliminary approval in the state House today, steamrolling objections from House Republicans and two Democrats who tried to block the move.

House Democrats warned that deep, devastating cuts will have to be imposed on popular state programs unless lawmakers dip into the hurricane fund. But dissident Democrat Rep. Ed Case joined with 19 House Republicans in an unsuccessful effort to stop the transfer and force budget cuts.

Case argued the state should "get away from credit card mentality" and reduce spending instead of seeking out new pools of cash to spend. Draining the Hawai'i Hurricane Relief Fund will only allow lawmakers to continue spending at levels that are too high, Case said.

"Lets be honest, let's be straight, let's be responsible, not only to this generation but to future generations," said Case, D-23rd (Manoa). "Let's not just put this problem off until next year when our next Legislature, there's no doubt in my mind whatsoever, is going to be debating the same basic problem without the resources that we will have spent this year."

Case also protested that the millions in the hurricane fund "should be segregated, walled off, fire-walled, insulated and dedicated to that next disaster."

Lawmakers are struggling to balance the budget after projected tax collections abruptly dropped off by $315 million for this year and next year in the wake of the Sept. 11 terrorist attacks. Gov. Ben Cayetano has proposed spending all of the $213 million in the hurricane fund to balance the budget, while the House has proposed spending $100 million of the hurricane fund money and holding the rest in reserve.

To make up the budget shortfall though budget cuts, the state would have to cut spending by an amount equivalent to what it spends on the University of Hawai'i, said House Majority Whip Brian Schatz.

"You cannot have it every way. You can't be for keeping the libraries open, for A-Plus funding, for (public worker) pay raises, for tax cuts and for leaving HHRF alone. It doesn't add up. Two plus two does not equal five," said Schatz, D-24th (Makiki, Tantalus).

House Bill 2654 HD2, the bill to transfer the $100 million from the hurricane fund to the general treasury, includes authorization to spend about $80 million on popular programs ranging from Hawaiian immersion education to tuberculosis and AIDS control to drug treatment programs for youngsters.

Packaging the spending authorizations with the hurricane fund transfer meant that if the transfer of the money in the Hawaii Hurricane Relief Fund was voted down, the spending for the programs would also fail.

"There's no money for these programs in the general fund," Schatz said. "Make no mistake and let's be honest with the public, if we don't fund these programs in this bill, they will die."

Others countered the Democrats are overstating the budget crisis, threatening to cut very popular programs when there are other less important programs that can be trimmed with less impact on the public.

"I would name this bill the Chicken Little bill, because it does say the sky is falling when it's not," said Rep. Joe Gomes, R-51st (Lanikai, Waimanalo).

Democrats retorted that if there are better places to cut the budget, the Republicans should have pointed them out. House Finance Committee Chairman Dwight Takamine said that in the "clear absence" of alternatives, the Democrats' bill should advance.

Case and the Republicans proposed an amendment to block the transfer of $100 million from the hurricane fund to the general treasury, but it was voted down 21-30. The 19 Republicans, Case and Rep. Mark Takai, D-34th (Waimalu, Newtown, Pearl City), voting in favor of the amendment.

The measure to transfer the $100 million from the hurricane fund to the general treasury was approved 28-23, with Case, Takai and Democratic Reps. Lei Ahu Isa and Terry Nui Yoshinaga voting with the 19 Republicans against the bill.

The measure now goes to the state Senate for further consideration.

Senate Ways and Means Committee Chairman Brian Taniguchi, D-11th (McCully, Mo'ili'ili, Manoa), said he has not ruled out the option of tapping the Hurricane Relief Fund to help balance the budget.

"I think most of us would rather not do it, but I think you kind of have to balance it, like the House is doing," he said. "You have to balance that with the needs that we have ... especially in education."

Advertiser reporter Lynda Arakawa contributed to this report. Reach Kevin Dayton at kdayton@honoluluadvertiser.com or 525-8070.