GOVERNOR LINGLE UNVEILS SUPPLEMENTAL BUDGET

For Immediate Release:  Monday, December 22, 2003

$539 million dedicated to capital improvements; priority on education, healthcare, economy, environment, and public safety

HONOLULU – Governor Linda Lingle submitted today to the State Legislature a proposed Supplemental Budget for an additional $539.3 million in capital improvement projects (CIP).  These funds focus on the high-priority areas of education, the economy, the environment, healthcare, and public safety.  

For fiscal year 2005, the Supplemental Budget also requests an additional $86.8 million from the General Fund for operating expenses, a 2.3 percent increase over current general fund authorizations.

“Over the past six months, our administration has heard directly from the community through our statewide ‘Talk Story’ sessions and other meetings with various stakeholders about what’s important to the people,” said Governor Lingle.  “Residents across the state shared with us their needs and visions for their communities, and our proposed Supplemental Budget reflects these concerns.”

“One of the constants we heard from residents during the ‘Talk Stories’ was the need to repair and upkeep our existing public facilities and core infrastructure, many of which have been neglected over the years and fallen into disrepair,” said Governor Lingle.  “The $539.3 million included in the Supplemental Budget for capital improvement projects addresses our improvement needs.  The low interest rates and the availability of federal matching funds make this the ideal time to move forward on these public construction projects.”

“While the local economy continues to strengthen, it is critical that we maintain fiscal discipline in managing our resources,” said Georgina Kawamura, director of Budget & Finance.  “The proposed Supplemental Budget is a prudent plan that ensures the health, safety and welfare needs of our residents and communities are properly met.  It also ensures our state’s long-term fiscal condition remains stable.”

Under Hawai`i’s biennial budget system, each budget period covers two fiscal years.  The current period, fiscal biennium 2003-2005, began on July 1, 2003 and ends on June 30, 2005.  Recommendations included in the Supplemental Budget reflect changes and adjustments that are deemed necessary at this time for State programs and agencies to meet current needs. 

As required by law, the Governor’s proposed budget must be accompanied by a balanced program and financial plan for the six-year period of 2003-2009.  The ending balance in the General Fund is projected to be $105.9 million in fiscal year 2004 and $94.4 million in fiscal year 2005.  The General Fund financial plan shows a positive ending balance for each year of the planning period.

Supplemental Budget Highlights

Education
With education as the Administration’s top priority, the Governor is proposing $90 million for school repair and maintenance; $20 million for new school construction; $12.3 million in federal funds to reflect increased revenues from No Child Left Behind and Individuals with Disabilities Education Act (Felix Consent Decree compliance); $2.5 million to address funding shortfalls in student transportation; $3.5 million for the Afterschool A+ program; and $1 million for library books and materials.

The budget also includes $25 million for major repair and maintenance, safety code compliance and infrastructure improvements at University of Hawai`i campuses statewide.  The University would also receive $1.8 million to fund 16 positions at the John A. Burns School of Medicine and $767,000 for a system-wide Creative Media program.

Health and Human Services
In order to continue to ensure the state delivers high-quality, integrated health and welfare services, the Governor is proposing:  $2.7 million to provide primary care for uninsured persons needing medical, dental and behavioral health services; and $11.8 million (to be matched with $19.2 million in federal funds) to provide medical insurance coverage under the QUEST program for more residents without health insurance and to cover rising costs under the existing programs.  These funds will provide an additional 5,400 citizens with medical coverage.  The budget also includes $7.3 million to restore healthcare funding for people covered under the Compact of Free Association.  (Under the Compact of Free Association, Hawai`i receives federal funding to help pay for services for Pacific Islanders who move here from U.S. Pacific Territories.)

In addition, the budget includes 54 positions and $18.5 million for Adult Mental Health programs to address caseload increases in Community Mental Health Centers and patient overflow from the Hawai`i State Hospital.

The Administration also added $31.2 million for the Hawai`i Health Systems Corporation (HHSC), which operates the state’s 12 community hospitals.  This restores funding for HHSC that the State Legislature did not include in the second year of the biennium budget.

$8.2 million is also proposed for renovations and repairs to state-owned housing projects statewide. 
Environment
Reinforcing the Administration’s resolve to preserve the Islands’ fragile environment and protect natural resources, the budget includes $18.2 million for Waimanalo Wastewater Treatment Plant improvements; $2.4 million for Kuhio Beach improvements; $14 million for statewide improvements at state parks; and $5 million (to be matched with county, federal and private funds) to strengthen invasive species control programs. 

Public Safety
With the State’s correctional system continuing to face critical challenges in terms of inmate overcrowding, aging facilities and high demand for treatment services, the Administration is requesting $26.7 million to replace the community correctional centers on O`ahu, Kaua`i and Maui, and for improvements to the Halawa Correctional Facility.  To alleviate overcrowding, $1.2 million is included to cover increased expenses for out-of-state inmate contracts; $5.1 million to send an additional 200 inmates to out-of-state facilities; and $900,000 to house an additional 25 inmates in the Federal Detention Center in Honolulu.  An additional $430,000 is proposed for various treatment programs. 
 
Economy
To build on the Administration’s efforts to expand and diversify the economy, the Governor is proposing $9 million for roadway repairs and improvements to the Kaka`ako Waterfront area; $2 million for the repair and maintenance of the Hawai`i Convention Center; and $8.4 million to construct building C at the Maui Research and Technology Center.  In addition, $22.9 million has been budgeted to reflect the receipt of federal funds for the electric vehicle demonstration project, technology development, coastal zone management, energy programs, and business marketing.

Transportation
In the area of transportation improvements, the budget also proposes $24 million to create the North South Road in Kapolei; $30 million for widening and realignment of Honoapi`ilani Highway on Maui; $30 million for highway improvements, including ADA compliance statewide; $12.5 million for terminal improvements and $30.4 million for inline baggage improvements at Kahului Airport; $28.3 million for inline baggage improvements at Honolulu International Airport; $41.5 million for various harbor improvements on O`ahu; and $10 million for renovations to small boat harbors statewide.

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For more information, contact:
Georgina Kawamura
Director, Budget & Finance
Phone:  586-1518