Legislators and Governor David Ige like to say that it’s the state budget that truly reflects their priorities, and the extraordinary budget document produced by the Legislative Assembly this year suggests that Hawaii’s political class has finally made it a priority to keep certain long-standing promises.
When presented earlier this year with a budget surplus of more than $2 billion – the largest in state history, by far – lawmakers pulled together a spending package intended largely to low-income families in the state, with a particular focus on long-neglected families. needs and grievances of the Hawaiian community.
The budget evolved considerably along the way, in part because more and more money became available.
Ige’s big budget proposal last December was to bank $1 billion of the surplus from the “rainy day” budget reserve fund, an idea no doubt inspired by the disasters under his leadership, including the casting Big Island lava flood, Kauai flood and Covid-19. pandemic that caused a collapse in state tax revenues.
The governor followed up on that idea in his State of the State address in January with another conservative proposal that the state distribute $100 tax refunds to each of Hawaii’s taxpayers and their dependents.
Lawmakers initially rejected the idea of pouring a huge sum into the rainy days fund, but the money continued to flow into the state treasury. An expert panel that projects state tax revenue raised its estimate by $890 million in January and another $450 million in March — a sum Ige had not factored into his proposal December budget.
Game in the Legislative Assembly. On opening day in January, House leadership announced a plan to provide $600 million to the Department of Hawaiian Home Lands in a new attempt to fulfill long-delayed promises and clear legal obligations to provide land. and accommodations for Hawaiians.
This was followed by a $328 million settlement in a long-running class action lawsuit over the state’s failure to meet its obligations to thousands of Hawaiians on Hawaiian’s waitlist. Homes, and a new agreement to provide the Office of Hawaiian Affairs with a larger share. revenue from the use of land formerly held by the Hawaiian Kingdom.
Lawmakers also delivered on their long-standing promises with Ige in 2020 to create a refundable working income tax credit, raise the state minimum wage, invest more in affordable rentals, and make early education more widely available to children in Hawaii.
Lawmakers also agreed to variations on Ige’s initial budget proposals. Rather than deposit $1 billion into the rainy day fund, the legislature approved a $500 million contribution to reserves, bringing the fund’s total to $800 million. After the session ended, Ige called it a “good investment”.
The Legislature also approved tax refunds that are a more generous version of what Ige originally proposed and would range from $100 to $300 for all taxpayers and their dependents.
It is now up to Ige to implement this spending program in the final months of his administration.
As governor, Ige has the power to spend much of the money or withhold it as he sees fit, at least until a new governor takes his place in December. He said in an interview Friday that he plans to push the Hawaii Lands Department to move quickly to spend as much of the $600 million as possible.
Here is an overview of the destination of the money.