Hawaii state budget (2009-2010)

Note: This article was last updated in 2010. Click here for more recent information on state budgets and finances.

2009
The Hawaii State Legislature passed during its 2009 session a biennium operating budget for fiscal years 2010 and 2011 totaling $24.8 billion, $13.37 billion for FY 10 and $11.4 billion for FY 11. Gov. Lingle objected to raising taxes to close the revenue gap and used her veto powers on $566 million of increased taxes , which the legislature quickly overrode.

The annual financial report for 2009 was reported 14 months late.

2010
Hawaii’s FY 2010 budget was in deficit before the fiscal year began on July 1, 2009. From March 2008 through August 27, 2009, the Council on Revenues, which forecasts the state’s tax revenues, projected that Hawaii would have nearly $3 billion less revenue than anticipated through June 30, 2011. Gov. Lingle stated in late September 2009, “Through various prudent spending restrictions, the Administration has reduced spending by $2 billion. However, we still face a $496 million shortfall in the next nine months and an additional $529 million from July 1, 2010 to June 30, 2011. That’s a total of $1.024 billion less money we will have in the next 21 months. Because of the huge revenue losses between fiscal years 2009 and 2011, it will take until fiscal year 2012 for our revenues to return to pre-recession levels.”

Governor Lingle announced on August 4, 2009 that the state would immediately begin delivering written layoff notices to the approximately 1,100 state employees who were previously notified their positions could be eliminated. In addition, the governor announced the furlough of approximately 900 "exempt excluded" nonunion state employees (employees not covered by a court order barring the governor from unilaterally implementing furloughs for union employees) for three days per month effective September 1, 2009.

A standoff between Governor Lingle and the public employees unions ensued. The largest public employee union in Hawaii, the Hawaii Government Employees Association, with about 30,000 members would vote in October 2009 on whether to accept a new contract with 42 furlough days over the next two years, which amounted to approximately an 8% cut.

Budget background

See also: Hawaii state budget and finances

Hawaii has an annual legislative session and sets a biennial budget in odd years. In practice the budget is submitted each year. State agencies submit their budget requests to the governor in September each year. The governor submits the budget in December, 30 days before the legislature convenes on the third Wednesday in January. The legislature meets for 60 working days. The state’s fiscal year runs from July 1 to June 30.

Budget figures

The following table provides a history of Hawaii's expenditures and gross domestic product (GDP).

Fiscal year	Expenditures (billions)	GDP (billions)
2000	$8.2	$40.2
2001	$8.8	$41.8
2002	$9.4	$43.5
2003	$9.6	$46.4
2004	$9.9	$50.4
2005	$10.5	$54.9
2006	$11.0	$58.7
2007	$11.5	$61.5
2008	$12.1	$64.5
2009	$12.7*	$67.7*

• NOTE: The figures for FY 2009 had not been finalized at the time this data was compiled.

Accounting principles

See also: Hawaii government accounting principles

The Hawaii State Auditor was Marion M. Higa. In May 2008, the legislature reappointed Ms. Higa to her third eight-year term to start on July 1, 2008. The State Constitution, in Article VII, Section 10, establishes the Office of the Auditor. The Constitution specifies that the Auditor be appointed for an eight-year term by a majority vote of each house in joint session. The Auditor may be removed only for cause by a two-thirds vote of the members in joint session. It is the constitutional duty of the Auditor to conduct post-audits of the transactions, accounts, programs and performance of all departments, offices, and agencies of the state and its political subdivisions. The audit reports are published online.

The Institute for Truth in Accounting (IFTA) rates Hawaii “tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR), the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA did not consider Hawaii’s CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis did not include significant liabilities for the pension plans and for other post employment benefits, such as health care. Hawaii's CAFRs are published online by the Hawaii Department of Accounting and General Services. Russ K. Saito was the Hawaii State Comptroller.

Credit rating	Fitch	Moody's	S&P
Hawaii	AA	Aa2	AA

Economic stimulus package

Hawaii would receive approximately $130 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.

Hawaii already receive $2 billion from the $787 billion dollar American Recovery and Reinvestment Act, or the "economic stimulus."

Error in ARRP

According to Recovery.gov, ARRP funds were going to 884 congressional districts, though there are only 435.

The ARRP contributed $2,284,000 to Hawaii in federal stimulus funds for the 11th Congressional District, $40,903,941 million for the 15th Congressional District, $1,651,811 for the “00” congressional district, and $799,656 in the 99th Congressional District creating a combined “3.4” jobs or $13,423,355 per job. Hawaii has just two congressional districts.

Budget transparency

See also: Evaluation of Hawaii state website

House Bill 122 was enacted on July 11, 2007 by the legislature without the signature of the governor. This bill mandated creation of a searchable grant and contract website for state expenditures over $25,000. However, the site failed to launch by the established deadline of January, 2009, and it had since become apparent that there were no plans to launch a transparency database. New transparency legislation, Hawaii Senate Bill 659 (2009), was enrolled to the governor on May 8, 2009.

Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State database	Searchability	Revenue Source	Expenditures	Contracts	Employee salary
None	n/a	n/a	n/a	n/a	n/a

Economic stimulus transparency

The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the nation. Of that $787 billion stimulus package, it was estimated that 69%, or over $541 billion, would be administered by state governments. It was estimated that Hawaii would receive at least $650 million in federal funding.

Two of the projects included $295,743 to conduct field mapping of late-glacial volcanic rocks in West Iceland for geochemical analysis. Hawaii's university also received $210,000 to study learning and cognition in honeybees.

Support for creation of a database

The National Taxpayers Union, Citizens Against Government Waste, and the Grassroot Institute of Hawaii supported transparency legislation (House Bill 122 and Senate Bill 1689).

Hawaii Senate Bill 659 was introduced by Senator Les Ihara.

Public employee salary information

See also: Hawaii state government salary

See also

• Hawaii government sector lobbying
• Hawaii public pensions
• Hawaii state budget and finances

External links

• State Budget Solutions, Hawaii
• Model transparency legislation from the American Legislative Exchange Council is available at this link.
• Grassroots Institute of Hawaii
• Hawaii Department of Budget and Finance
• Hawaii government spending
• FB 2007-2009 Executive Biennium Budget

Additional reading

• Los Angeles Times, "Hawaii was far from an economic paradise," January 2, 2010
• Gov. Linda Lingle, "2009 State of the state address," January 26, 2009