Balancing the budget
Wielding both pen and proverbial sword, Hawaii Gov. Josh Green was mighty busy this week.
On Tuesday at the University of Hawaii Maui College, he used the pen to sign House Bills 1255 and 353 into law. HB 1255 authorizes $20 million in special purpose revenue bonds to assist construction of the West Maui Hospital and Medical Center. HB 353 helps cover costs for the Certified Nurse Aide-to-Practical Nurse Bridge Program started at UH-MC. This program helps nurse aides seeking to become nurses pay for their college tuition, fees, supplies and other related costs.
Green’s swordlike slashing came Wednesday when he used 22 line-item vetoes to trim the state’s two-year budget by $1 billion. The governor said his hand was forced by a recent Council on Revenues report that predicts declining tax collections will cause Hawaii’s General Fund to drop from $21.7 billion to $20.6 billion. Most of his cuts were to infrastructure projects, including $50 million for a proposed emergency and cybersecurity facility in Mililani.
While it is true that the governor is bound by Hawaii’s constitution to oversee a balanced budget, the more traditional tactic has been incremental cuts in response to shortfalls as they occur. Green chose to play it safe, and, perhaps, to take the Legislature to task.
Hawaii lawmakers passed the budget in May before the Council on Revenues report was released. They cannot be blamed for working with a larger number, but their budget was pushed through amid concerns about transparency and a rushed vote. Some of the budget’s more controversial items were among those slashed by Green. He now waits to see if lawmakers can muster the votes to override any or all of his vetoes.
The economy will also have a say. Economists predict a drop in Hawaii tax revenues from 2 percent growth to minus 1 percent. In a forecast published May 12, the UH Economic Research Organization says high interest rates and a tight credit environment have caused plummeting real estate sales, weakening retail sales and contraction of manufacturing in the state. It predicts there will be a national recession by the end of this year, and while Hawaii’s economy is resilient enough to weather the coming downturn, the post-pandemic gravy days are likely over.
News like this sends shivers down the spines of everyone from state department heads and project developers to nonprofit directors. Whose slice of the budget will be trimmed and whose will be axed entirely? Green stuck to his commitment to address housing, homelessness and health care. He put operations and workers over construction projects, both controversial and otherwise.
West Maui Hospital Foundation members and UH-MC nursing students were likely grateful for the support they are getting from the state. Let’s hope programs like these can continue to receive the funding they need, and that contentious, rushed-though budget items receive the scrutiny they deserve.