POSTED: 11:03 a.m. HST, Apr 5, 2011
LAST UPDATED: 11:21 a.m. HST, Apr 5, 2011
The state Senate Ways and Means Committee approved today the Senate's draft of the budget, which would preserve the equivalent of two furlough days a month for state workers to contain costs over the next two years.
The committee's draft, which now goes to the full Senate, includes $11 billion in state spending for fiscal year 2012 and $10.8 billion in state spending for fiscal year 2013. The Senate draft is slightly higher than the state House budget draft for 2012 and slightly lower than the House version in 2013. Both the Senate and House drafts are lower than what Gov. Neil Abercrombie has proposed.
The Senate's budget contains $5.4 billion in general fund spending in 2012 and $5.5 billion in 2013, which is lower than the House draft. Lawmakers and the governor have the most discretion over the general fund portion of the budget.
State Sen. David Ige (D, Aiea-Pearl City), the committee's chairman, said the Senate draft has about $650 million in savings, about half of which comes from preserving furloughs at existing levels. Ige said the administration could achieve the equivalent labor savings through steps other than furloughs.
Senators also recommend evenly splitting health care premium costs with state workers. The Abercrombie administration has agreed to a 60 percent to 40 percent split on premium costs for the end of the fiscal year and is negotiating the split going forward in collective bargaining talks with public-sector unions.
Senators will rely on separate revenue-generating bills to balance the budget and close a projected two-year deficit of about $1.3 billion. Ige said the Senate would likely repeal a state income tax deduction, impose a pension tax, cap hotel-room tax revenue that goes to the counties, and raise the liquor tax.
Tomorrow, the Senate Ways and Means Committee will hear a bill that would raise the general excise tax and temporarily suspend GET exemptions on certain businesses. The two options are the largest sources of potential new revenue to lower the deficit.