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The Honolulu Advertiser
Updated at 4:46 p.m., Monday, December 22, 2008

Budget plan will need public-private partnerships

Gov. Linda Lingle yesterday unveiled a sensible first draft of a state budget, one that needs to fulfill the tough mission of staying in the black during a period of economic crisis.

It's a challenge of unprecedented proportions. The governor and other elected leaders acknowledge the need to set aside partisan disputes in this effort. They also need to seek new alliances to form a social services net, which becomes ever more critical during a downturn.

The Council on Revenues' next report, due Jan. 9, will likely bring more bad news.

And the state is still studying a state Supreme Court ruling issued late last week barring the transfer of money into the general fund from regulatory fees paid by insurers.

That's important because Lingle's budget proposal would similarly tap $36 million and $9 million, respectively, from the Deposit Beverage Container Special Fund and the Wireless Enhanced 911 Special Fund.

In a biennium budget of $22.42 billion, however, that wrinkle may cause less worry than the compounding impact of persistent economic doldrums. Lingle's capital-improvement bonanza of nearly $3 billion over the two years is aimed at staving off that kind of long-term slide.

Some of the funds are being carved out of social-services spending. Lingle said that ordinarily, victims of job layoffs lean on unemployment insurance and retraining programs rather than state-funded programs for the needy.

But these are not ordinary times. The executive and legislative branches need to keep an eye on any increased demand for those services, a trend that a prolonged recession could spark.

As the governor herself pointed out, an uncommon degree of cooperation between lawmakers and government agencies is essential. Postponing increases across the public payrolls, for example, may be necessary to avert more catastrophic cuts.

In addition, the administration and the Legislature should think creatively about new incentives to draw private agencies and businesses into partnerships to help fill in service gaps that will open up in state budgets.

To navigate out of this economic storm, it's going to take all hands on deck.