The Republican governor urged the Democratic-led Legislature to not override the veto, although it is expected to do just that in the coming days. The arbitration panel gave 23,000 HGEA workers pay increases of between 5 and 9 percent.

Lingle, speaking to reporters this morning, said the raises will cost the state $32 million more in fiscal year 2005, which begins July 1, and $54 million annually beginning in fiscal 2006.

"It’s not because I want to withhold this award but because it will create larger deficits," she said.

Anticipating the HGEA raises will go through, Lingle said she today is placing on all state agencies a moratorium on all discretionary funding, including the purchase of equipment and furniture, training, supplies, motor vehicles and consultant and personal services contracts. Such a moratorium is expected to help raise the carryover savings from this fiscal to the next, which is now anticipated to be $85 million on July 1.

The decision of the three-member arbitration panel was "flawed," Lingle said, and did not present an accurate picture of the state’s ability to pay the raises.