The Senate Ways and Means Committee voted unanimously yesterday to approve a scaled-back version of a bill that would have raided 138 of the state’s special funds to help address a budget shortfall.
The latest version of the bill would repeal 16 special funds and take some money from another 23 funds.
Senate Bill 120 does not specify how much money would potentially be diverted from those 39 special funds.
"We have identified a number of funds that we believe would be appropriate for repeal," said Ways and Means Chairman David Ige (D, Aiea-Pearl City). "We’ve also identified a number of funds that we believe may have excess balances that we may want to sweep at the end of session."
The bill now goes for a vote by the full Senate.
Among the funds still targeted for repeal are the Rx Plus special fund, which subsidizes prescription medications; two irrigation special funds designed to promote diversified agriculture and repair infrastructure; and two University of Hawaii scholarship endowment trust funds.
The bill now spares many funds whose potential repeal drew community criticism in more than three hours of oral testimony when the measure was first introduced, including the wireless enhanced 911 special fund, the tobacco settlement special fund and UH special funds.
Supporters of the latest draft of the bill say it is a step toward fiscal responsibility for the state.
"They should have started doing this a long time ago," said Lowell Kalapa, president of the Tax Foundation of Hawaii.
Kalapa said the bill now addresses the concerns of people who questioned raiding administrative fees like the UH student activity fee.
"If people are legitimately being asked to contribute a fee for which we are promising a specific activity or service, the courts protect that money," he said.
Kalapa estimated that state special funds could be holding between $500 million and $700 million — money he said could be put to better use for other services.
SPECIAL FUNDS AT RISK
TO BE REPEALED
» Travel agency recovery special fund
» Child care programs revolving fund becomes a special fund
WILL LOSE SOME MONEY
»State risk management revolving fund