HONOLULU- State Budget and Finance Director Kalbert Young told lawmakers Monday the Abercrombie administration is drawing up a revised six year financial plan in order to deal with long-term deficits that rise above $300 million within the next four fiscal years.
Young could not rule out the possibility of tax increases in order to tackle the skyrocketing cost of operating state government.
“
The implications for the next biennium and the one after are quite considerable and severe that revenue enhancements should at least be reviewed,” said Young. “I can't stand here before you and say definitely no or definitely yes.”Young spoke at the State Capitol auditorium during a joint briefing of the Ways and Means and Finance committees of the House and Senate. Lawmakers were provided the following deficit projections for the next five fiscal years, which are
not cumulative:
FY-2013 $19.3 million
FY-2014 $164.2 million
FY-2015 $229.1 million
FY-2016 $312.4 million
FY-2017 $278.9 million
A projected shortfall of $19.3 million for fiscal year 2013, which begins July1, is small enough that Young said it could be dealt with through programmatic initiatives. For example, the administration has begun a 1.5 percent spending restriction for all state agencies and may delay the awarding of some contracts.
However the bigger issue for lawmakers is what to do with the governor’s supplemental budget request presented last month. Abercrombie wants to increase state spending by $35 million after $86 million in savings are accounted for.
“
Over a quarter billion dollars we're going to be behind and really if there's any message and policy implications it's that, 'Look, if you guys got any extra money, don't spend it,’” said House Minority Leader Rep. Gene Ward.“There's not much room to add new programs, new services or expansion of programs and services,” said Rep. Marcus Oshiro, chairman of the House Finance Committee. “It's a sizeable reduction so they need to plan for the out years over the six year period.”Young said an updated six year financial plan would be available to lawmakers in about two weeks.
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