Lingle emphasizes financial straits
By Dan Nakaso
Advertiser Staff Writer
Hawai'i faces tough financial times and "would have run out of money by June 30" if it weren't for cuts in spending, Gov. Linda Lingle said yesterday.
Advertiser library photo
"We're on the verge of things becoming very difficult in our state and in our country," Lingle told 130 small-business owners and legislators at the Pacific Club. "The quicker ... people face that, the better we'll be able to address it when it does come."
"It's fascinating to me that we're in as good a shape as we are," Gov. Linda Lingle said.
State tax revenues of $307.9 million in January were 9.6 percent below the previous January, when the state was still reeling with the fallout from the Sept. 11 attacks. On March 13 the Council on Revenues is expected to say tax collections will be less than forecast.
Last month, Lingle imposed spending cuts of up to 5 percent on state departments.
Lingle said the attitude in state government has to change. In particular, she blasted the public housing agency for being forced to return $245,589 in federal anti-drug grant money because it was not spent on time. In all, the Housing and Community Development Corp. of Hawai'i must refund nearly $750,000.
"Through laziness and ineptness, that money has been allowed to lapse," she said.
She called her three months in office, and her first legislative session, an experience unlike any she's had till now.
"I've never dealt with a group of people like this before or a process like this," Lingle said. "It's fascinating to me that we're in as good a shape as we are. ... Honestly, it doesn't lend itself to real good, logical decision-making and common sense."
Lingle also ripped a legislative proposal to raise the state's general excise tax from 4 percent to 4.5 percent to pay for new spending. "It's the absolute wrong time to be talking about raising taxes or to be raising taxes," she said.
At the same time, the state appears headed toward litigation with DFS-Hawai'i, the airport duty-free retail contractor, over $40 million owed in back rent. "I've told them they had to pay up everything they owed through the end of the year before we would even begin any discussion," Lingle said. "Then they didn't want to talk anymore."
Lingle praised Mark Recktenwald, director of commerce and consumer affairs, whose department just cut the fee for filing credit card payments through the state's Internet portal by 25 percent. People who subscribe to the portal and who file regularly will get a 50 percent cut, Lingle said, and "this will mean a half a million dollars back into the business community."
Rodney Harano, a certified public accountant from Manoa, was among many in the audience who agreed with Lingle. "She makes a lot of sense," Harano said.
Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or 525-8085.
