State House and Senate budget negotiators said Monday that new contracts for public-sector labor unions would likely limit their options for spending on tax incentives and new state programs.
The state has reached a four-year, $330 million contract with the Hawaii State Teachers Association; a tentative agreement on a four-year, $107 million deal with the United Public Workers; and a tentative agreement on a two-year, $66 million pact with three Hawaii Government Employees Association units.
Sen. David Ige, the lead Senate budget negotiator, and Rep. Sylvia Luke, the lead House negotiator, said they want the state’s two-year budget and six-year financial plan to reflect the new contracts, provided the agreements are ratified before the end of session next week.
Ige and Luke said the contracts are coming in higher than expected, which will likely influence other spending decisions.
"The good thing about it is at least there’s clarity on exactly how much money it is," said Luke (D, Punchbowl-Pauoa-Nuuanu). "As I said before, it’s larger than anticipated, so it’s going to — as we continue to deliberate on the budget — it’s going to make an impact on what we do with the overall executive budget and some of the initiatives that came out, and what do we do with the rest of the bills that are outstanding?"
House and Senate negotiators are expected to complete work on the budget this evening, which will enable other bills with financial components to move in conference committee. The deadline for lawmakers to finish work on bills is Friday, with final votes scheduled before session adjourns May 2.
"It does appear that the actual agreements are coming in higher than we anticipated, so we’re just reworking the numbers and trying to see, and make sure, that we can afford it," said Ige (D, Pearl Harbor-Pearl City-Aiea). "Obviously, it does have some impact on the funds available for the budget as well as other legislative initiatives."
Budget negotiators agreed Monday night to an additional $12.8 million in fiscal year 2014 for the student spending formula at public schools. The weighted student formula is based on student need, not simply enrollment, but the increase reflects enrollment growth. Negotiators trimmed $1.8 million from the formula in fiscal year 2015, however, to account for the elimination of junior kindergarten.
Gov. Neil Abercrombie’s proposal to outfit all public school students with laptop computers received a show of support, with lawmakers agreeing to $8.2 million in fiscal year 2014 to fund pilot projects in three school regions: Kau, Waianae-Nanakuli and Pearl City.
Negotiators also agreed to remove about 200 vacant positions from the budget. Many state departments have been using the money from vacant positions for vacation payouts and other expenses.
Luke’s House draft of the budget would have eliminated more than 930 positions that have been vacant for more than a year, which would have saved about $55 million. Removing about 200 vacant positions, which will be identified by state departments, would save about 20 percent of that amount.
"So I think what Chair Ige and I accomplished today is changing the behaviors of the various departments — being more responsive and accountable for these different vacancy positions," Luke said.
Ige said the attempt is to make the budget more transparent. "If the departments are going to ask for positions, then they ought to fill it. If they’re not going to fill it, then we’re going to take it," he said.
