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The Honolulu Advertiser
Posted on: Wednesday, May 3, 2006

Total state budget rises to $9.6 billion

 •  Kamehameha traffic improvements funded

By Derrick DePledge and Treena Shapiro
Advertiser Capitol Bureau

State Sen. Colleen Hanabusa, D-21st (Nanakuli, Makaha), stood yesterday to support a Senate floor amendment to the wholesale gasoline price cap, which would have removed Singapore gas prices in the monitoring of gas prices. Next to Hanabusa is state Senate Vice President Donna Mercado Kim, D-14th (Halawa, Moanalua, Kamehameha Heights). The floor amendment was later withdrawn.

BRUCE ASATO | The Honolulu Advertiser

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State lawmakers gave final approval yesterday to the state budget and were nearing completion on other bills that will outline how the state will use a $600 million surplus.

The state's general fund budget will grow by more than $221 million next fiscal year to $4.7 billion, with much of the new spending going to public education. Overall, after new federal and special fund money is counted, the total state budget jumps to $9.6 billion.

A separate capital improvement budget came in at about $1.8 billion. The budget and construction money does not include additional spending in other bills for public school repair and maintenance, $60 million to cover emergency storm damage, $50 million for tax relief, about $50 million for affordable housing, and $100 million over four years for an innovation fund to promote technology.

Lawmakers also want to keep more than $100 million in reserve as a precaution against an economic downturn.

"We must not squander this chance to chart a new course. We don't know what the future holds. That's exactly why we must exercise fiscal restraint," said state Rep. Dwight Takamine, D-1st (N. Hilo, Hamakua, N. Kohala), the chairman of the House Finance Committee.

The House and Senate held daylong sessions yesterday, casting final votes on bills before the session adjourns tomorrow. Lawmakers could not get to all of the bills last night and have scheduled several votes for tomorrow, including some that did not make an internal deadline last Friday to be heard yesterday.

The Legislature appears on track to finish work on its priorities public education, affordable housing, energy and tax relief but there were a few bills that failed yesterday, along with an aborted attempt to again amend the price cap on gasoline.

The House rejected a bill that would have reversed two changes to state campaign-finance law that had been made last session. The first would have allowed corporate executives to move unlimited amounts of money from their treasuries into corporate political action committees. The second would have prohibited corporations from using partnerships and subsidiaries to bypass donation limits to political candidates.

Lawmakers had said the changes to the law last session were inadvertent and caused unnecessary confusion, but the state Campaign Spending Commission had urged lawmakers to keep the limit on corporate PACs. The commission favored restoring the limits on partnerships and subsidiaries, however.

Activists from groups such as the Sierra Club and Hawai'i Clean Elections conducted a lobbying campaign against the bill over the past few days that influenced the House. The Senate passed the bill yesterday. "We are surprised that despite all of the rhetoric of good government and cleaning up politics the Legislature would consider removing the limits on corporate influence in local elections," Jeff Mikulina, director of the Sierra Club's Hawai'i chapter, said in a statement.

The House and Senate both defeated crosswalk bills after lawmakers decided the penalties were too tough. The bill would have fined motorists $150 and suspended their licenses for 90 days the first time they were caught violating the state's crosswalk law, which requires drivers to stop, rather than yield, when a pedestrian is in the crosswalk on their side of the road.

The potential amendment to the gas cap took up much of the morning and came close to passing before supporters in the Senate miscalculated. House and Senate conferees agreed last Friday to indefinitely suspend the price cap but give Gov. Linda Lingle the authority to reinstate it if gas prices go up.

The agreement also would add Singapore to the three Mainland markets used to calculate the cap if it is ever brought back by the governor, which the cap's main sponsor, state Sen. Ron Menor, D-17th (Mililani, Waipi'o), believes would lower prices by as much as 16 cents.

Some lawmakers believe that adding Singapore to the formula would artificially lower hypothetical prices under the cap and give consumers misleading information. Some also worry that Menor would use the new formula to tell consumers how much money they would have saved under the cap and portray lawmakers as thin-skinned and shortsighted for suspending it in an election year.

The House passed an amendment yesterday that would have removed Singapore from the formula after House leaders believed the Senate would follow. But the same Senate faction that was involved in an unsuccessful coup against Senate President Robert Bunda, D-22nd (N. Shore, Wahiawa), at the end of last session failed to get a majority to support the amendment when Republicans would not go along.

The House then had to go back and yank the amendment so as not to threaten the gas cap bill when it comes up for a final vote tomorrow.

Menor, who said the amendment would have violated the good faith of Friday's agreement, blamed lobbying by the oil companies who have opposed the gas cap. "I think that the oil companies were making a last-ditch effort to try to kill this measure," he said.

Reach Derrick DePledge at ddepledge@honoluluadvertiser.com and Treena Shapiro at tshapiro@honoluluadvertiser.com.