Hawaii senators want to fund preschool, innovation

HONOLULU (AP) -- The Hawaii Senate Ways and Means Committee has announced a two-year state budget proposal that funds some of Gov. Neil Abercrombie's key initiatives, including early childhood education.

The Senate proposal is more generous than the House budget draft but it stops short of giving Abercrombie everything that he's asking for.

The Senate's two-year budget proposal total is about $24 billion. That includes about $314 million in funding for Department of Hawaiian Homeland trust funds that weren't listed in either Abercrombie's or the House estimates.

The committee says that because of the nature of trust funds, the Department could spend the money regardless of what the Legislature appropriates. Senators wanted to factor the money into the budget to increase transparency.

Without taking the trust fund money into account, the Senate proposal is still a considerable increase from the $23.25 billion House budget but less than Abercrombie's request.

One major difference between the House and Senate proposals is that House lawmakers chose to cut funding for more than 900 state positions that have been vacant for two or more years.

State department leaders protested the cuts and the Senate committee didn't include those reductions in its budget proposal.

"There is no fat left in the budget," said Sen. David Ige, who chairs the Ways and Means Committee. He says past budget cuts have caused some department leaders to leave vacancies open to make sure they have enough funding for their operations and that some of the positions are in the process of being filled.

The committee also chose to fund Abercrombie's highly publicized preschool program. Abercrombie initially requested about $32 million over two years for the program, but the funding was left out of the House budget draft.

The Senate draft dedicates $1.6 million for fiscal year 2014 and $24.9 million for fiscal year 2015 for the initiative.

State Finance Director Kalbert Young says the proposed funding for preschool is a step forward but he noted that the program may end up looking different from what advocates envision.

Senators also added $4 million per year for the state's existing Preschool Open Doors program, which provides child care to low income families through the Department of Human Services.

Ige noted that the committee chose to double Abercrombie's funding request for the Weighted Student Formula, which determines school funding by student need. Senators are proposing funding about $55 million over two years.

The Senate committee also decided to set aside $8 million in fiscal year 2014 to the HI Growth Initiative, a new program to provide resources to aspiring entrepreneurs. That's less than half of Abercrombie's $20 million request, but still significant because the program didn't receive anything in the House draft.

Young says he thinks the state can work with the $8 million. He said he hopes that if the program makes progress over the next year, the state will consider adding more funding for fiscal year 2015.

The Senate and House budget proposals do have several areas in common.

Both proposals set aside at least $100 million per year to help draw down the state's unfunded liabilities for employee and retiree benefits.

The Senate draft goes further by adding a schedule to increase funding for unfunded liabilities to $500 million by 2018.

Neither the Senate nor the House budgets includes funding for collective bargaining agreements because negotiations are ongoing.

Ige says that if the state agrees to a 3 percent pay raise for teachers, the Senate would have to reduce its budget proposal and cut more of Abercrombie's requests.

The Hawaii State Teachers Association and the state reached a tentative agreement earlier this week to raise teachers' pay by about 3 percent.