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The Honolulu Advertiser
Posted on: Monday, March 29, 2010

Hawaii Senate panel's draft budget taps various funds

Advertiser Staff

The state Senate Ways and Means Committee today approved its draft of the state budget, slightly increasing total spending from Gov. Linda Lingle's $10 billion budget request but cutting $14 million in general-fund spending over which lawmakers and the governor have the most discretion.

The committee chose to scoop some hotel-room taxes from the counties to balance the budget. Senators want to cap the hotel-room taxes at $50 million, while the state House version of the budget set the cap at the existing $94 million.

Lingle had proposed scooping all the hotel-room tax money from the counties to help close the deficit.

The committee also siphoned $45 million from various special funds to combat the deficit.

The committee would take $32.5 million from the state's hurricane relief fund and $33.5 million from the general fund to reduce 12 of 17 teacher furlough days next fiscal year. Senators expect teachers to make up the remaining five days through adjustments to non-instructional days.

The committee also would cut non-core functions at the state Department of Education.

By comparison, the House devoted $50 million in general-fund money to end teacher furlough days next school year. The House also cut $18 million from the department's weighted student formula, which the Senate would preserve.

The committee would also save $12.5 million by closing a module at Halawa Correctional Facility, which would send about 250 prisoners to the Mainland, where incarcerations costs are cheaper.

The committee opted not to pursue an increase in the general-excise tax to help balance the budget. Two Senate committees had recommended a GET hike, but state Sen. Donna Mercado Kim, D-14th (Halawa, Moanalua, Kamehameha Heights), said a broad-based tax hike would threaten businesses and force layoffs.

The Senate's budget draft now goes to the full Senate for a vote.

House and Senate negotiators will meet in conference committee to come up with a final draft to send to Lingle.