Good news for Kapolei library

By Lynda Arakawa and Gordon Y.K. Pang
Advertiser Capitol Bureau

House and Senate budget negotiators have agreed to provide money for the Kapolei Public Library, which has been closed for lack of a state appropriation for books.

Yesterday was Day 55 of the 60-day session.

House and Senate conferees verbally agreed to appropriate $1 million for the Kapolei facility in the fiscal year beginning July 1, said Senate Ways and Means Committee Chairman Brian Taniguchi, D-10th (Manoa, McCully). They also decided to provide the library another $1.6 million the following year.

House and Senate lawmakers are working this week to resolve differences between their versions of hundreds of measures and to position the reconciled bills for final voting next week. The Legislature adjourns on May 1.

Sen. Brian Kanno, D-19th (Kapolei, Makakilo, Waikele), said he hoped the additional money would help the Kapolei Public Library open in December. Of the $1 million appropriation, $800,000 would go toward buying books and $200,000 would be used for equipment and furniture.

Kanno said the budget bill also includes $600,000 for 19 library hires in fiscal 2004.

"It may not be the full-blown library with all the bells and whistles, but a limited opening," he said. "But it would be much better than what's available now, which is a volunteer reading room."

State library special assistant John Penebacker, however, said it is premature to conclude that the Kapolei library will actually open by the end of the year. He said the budget bill has yet to be passed, Gov. Linda Lingle has to sign it and, most importantly, the governor has to release the money promptly.

"We're quite grateful to the Legislature for its support, and it moves it closer to reality as far as Kapolei is concerned," Penebacker said. "I think this is one of the first of many steps we have to go through. The only thing we can say at this time is that we're properly positioned to move forward."

Penebacker said that if the money isn't released before the end of summer, it would be difficult to get the library up and running by the end of the year.

Also yesterday, the debate over high-tech business tax credits sparked dueling press conferences by the Democratic House majority and Republican leaders from both the House and Senate.

At the end of the day, House Democrats continued to block a conference committee hearing on the governor's plan to narrow the eligibility requirements for receiving Act 221 tax credits.

Rep. Brian Schatz, who heads the Economic Development Committee, said the governor is mistaken in asserting that the state budget cannot be balanced without the amendments.

The administration estimated that the changes would bring $55 million into the general fund in the next two years. Over the weekend, Tax Director Kurt Kawafuchi said that for the first nine months of the year, $26.4 million in receipts were negated by some $40.8 million in refunds, most of them the result of Act 221.

Schatz, D-25th (Makiki, Tantalus), said those numbers overstate the negative impacts of Act 221 while understating the benefits reaped by new businesses. "We want everyone to know we are going to have a balanced budget. We are not going to raise taxes and we are not going to reverse our course in diversifying the economy," he said.

According to a report issued by the Hawai'i Technology Trade Association, nearly 4,000 jobs have been created directly and indirectly since Act 221 took effect in 2001.

Republican lawmakers, however, pulled out statistics provided by the Department of Taxation showing jobs and wage growth dropping among 23 qualifying high-tech companies that took the credit while the rest of the high-tech sector saw gains.

"The fact is, the numbers clearly show the impact of Act 221, and their speculation of what the future is going to be is just that — speculation," said Senate Minority Leader Fred Hemmings, R-25th (Kailua, Waimanalo, Hawai'i Kai).

Sen. Sam Slom, R-8th (Kahala, Hawai'i Kai), who is also executive director of Small Business Hawai'i, said loopholes in the bill have allowed "massive giveaways" that don't help small enterprises.

Advertiser Staff Writer Will Hoover contributed to this report.

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