Souki, Kim take different tones on new taxes

State Senate President Donna Mercado Kim said Wednesday that despite anticipating a better economy, lawmakers should not impose new tax burdens on residents or reflexively expand state programs.

House Speaker Joseph Souki said the state must generate new revenue if legislators want to restore the social safety net, improve public education and repair infrastructure.

The two new leaders used their opening day speeches to outline priorities for the 60-day session, delivering similar warnings about being cautious during the economic recovery but with slightly different tones on taxes.

"I hope, first and foremost, that there’ll be no new tax burdens thrust upon our citizens and that we will not automatically open the taxpayers’ pocketbooks to every budget request, to every new proposal and every new capital improvement project," Kim told the Senate. "I’m not saying that we should not consider new initiatives. After all, the Legislature is a forum for new ideas, new ways of doing things to better the quality of our life.

"But as we weigh their merits, let’s also look at the merits of what we already have. Re-evaluating and reassessing what we have in place may not sound sexy or innovative or sell newspapers, but we must discipline ourselves to do this if we are to be more efficient and effective than we have been."

Kim (D, Kalihi Valley-Moanalua-Halawa) referred to the Public Land Development Corp., the controversial development arm of the state Department of Land and Natural Resources, as one of the provisions that needed to be fixed or repealed if not working as intended.

Kim also said lawmakers would consider Gov. Neil Abercrombie’s proposal for state-funded preschool, but that the state should first make sure it resolves problems at public schools, such as a contract fight with teachers, rising school bus costs and oversight of charter schools.

"I want to caution us before we move forward on a new program, we have to make sure we have good programs," she told reporters after her speech. "I don’t want to institute a program that’s going to be mediocre."

Souki (D, Waihee-Waiehu-Wailuku) said the state must increase its revenue stream with a mix of strategies to finance state government.

"We have the chance now to rebuild what the recession took away," he told House members.

He said the state should rethink tax credits and give a serious and thorough look at an expanded film tax credit that could bring millions to the state from increased film production.

But the speaker also said the state’s 11 percent personal income tax rate is too high and suggested that middle and lower-income earners get tax reductions, perhaps incrementally through the next few years.

Souki later said that he would keep other tax options open as the House examines the two-year state budget.

"But right now I’d like to say, for me, everything is on the table," he said, adding that he was aware that many House and Senate lawmakers and Abercrombie have said they want to avoid tax increases.

Souki repeated his support for legalized gambling, but said he would not introduce gaming legislation this session and would instead wait for the direction of his caucus.

Kim said she has favored only electronic gaming, such as slot machines, and does not see the votes in the Senate to legalize gambling this session.

Republicans, who have been granted vice chairmanships on several committees in rare partnerships with majority Democrats, emphasized fiscal responsibility and greater transparency and accountability.

Senate Minority Leader Sam Slom (R, Diamond Head-Kahala-Hawaii Kai) called for the repeal of the PLDC and criticized other recent proposals that would grant government favorable or fast-track powers to sidestep regulation.

"We need meaningful change and must provide consequences for bad behavior and poor performance in government," he said.

House Minority Leader Aaron Ling Johanson (R, Fort Shafter-Moanalua Gardens-Aliamanu) said the public is asking for "more common-sense leaders who work to find common ground."

In the House, Souki and his coalition of dissident Democrats and Republicans formally took power from former Speaker Calvin Say, who had led the House for a record 14 years.

But the last spasms of the leadership fight played out in front of dignitaries, family and other guests who had filled the chamber for the traditional opening day pomp.

Say offered a floor amendment to the resolution electing Souki as speaker that would have given his loyalists the opportunity to vote on the record for Rep. Marcus Oshiro, his chosen successor. The amendment was rejected by a voice vote.

The resolution naming leadership and committee assignments, which included three vice chairmanships for minority Repub­licans who have backed Souki, was approved in a 30-20 vote. All 18 of the Democrats behind Say and Oshiro and two Democrats in Souki’s coalition voted against the lineup.

Rep. Sharon Har (D, Kapolei-Makakilo) spoke against Souki’s coalition, accusing the new leaders of a campaign of "revenge, vindication, retribution and punishment" against Say’s supporters. She cited Say’s new seat on the House floor — the last seat in the back row on the GOP side of the chamber — as evidence.

Both Souki and Majority Leader Scott Saiki (D, Downtown-Kakaako-McCully) publicly recognized and praised Say for his service. Rep. Sylvia Luke (D, Punchbowl-Pauoa-Nuuanu), one of the dissidents instrumental in ousting Say, presented him with a lei.

Saiki urged his colleagues to be mindful of the memory of the late U.S. Sen. Daniel Inouye, whom he described as a statesman who put the greater good ahead of personal politics.