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Straight Talk from the Capitol

May 14, 2009
Senator Roz Baker · 5th District South & West Maui

Aloha kakou,

The differing approaches for balancing the budget offered by the Legislature and Gov. Linda Lingle persisted through budget conferences. In light of these fundamental differences, the Legislature added another day to the session so that expected gubernatorial vetoes of tax or revenue measures could be considered for an override vote before adjourning sine die. Otherwise, those bills would be vetoed after adjournment leaving an unbalanced budget. The veto override session is normally on the 45th day following adjournment, or July 14, well after the biennium budget goes into effect July 1.

Raising revenue

The majority of legislators felt that raising various taxes and fees on selected industries was the way to go to balance our budget. I disagreed. I felt this could result in far-reaching negative impacts and unintended consequences to the long-term recovery of our economy.

Case in point is SB199: The current bill would substantially cut off the flow of investment capital critical to Hawai‘i’s continued growth of high-tech businesses. Tech industry leaders offered an alternative approach; the Senate prepared to advance the compromise to save good-paying jobs and businesses. The House rejected our efforts.

Another example is HB 1271: It raises the tax on a barrel of oil from $.05 to $1.05 to fund laudable environmental and agricultural programs, but it also drives up the cost of gasoline and jet fuel. In addition, the legislative majority, over our strenuous objections, has allowed the general excise tax exemption for ethanol-blended fuels to sunset again, which will cause gasoline prices at the pump to rise even higher. This is not the time for so many tax and fee increases.

On the bright side, the Legislature did not take back the portion of the TAT (hotel room tax) designated for the counties. And, because of other revenue strategies, a number of important programs and projects for Maui were funded as a result.

Final thoughts: Given the current economic situation, some increases in state fees and taxes are inevitable. However, I fought for a more balanced, shared-sacrifice approach than the one finally adopted. I am hoping that some of these increases will be revisited next session.

MMMC advances

One of the most important measures we passed this session is SB1673 to improve our hospitals. Introduced by your Maui Senators, SB1673 changes the fundamental structure of the Hawai‘i Health Systems Corporation, allowing the formation of public-private partnerships. What this means for Maui Memorial Medical Center (MMMC) is local autonomy to attract private investment capital and partnership opportunities, giving MMMC the power to control its own funds for the improvement and expansion of services. This also means that our community will be able to give meaningful input and help shape the hospital’s future. MMMC will still be able to access public funds during any transition. Thanks to the hard work of Sen. Shan Tsutsui, vice chair of the Ways and Means Committee, the budget bill contains an additional $30 million dollars for the system’s three acute care hospitals (Maui, Hilo, Kona) next year.

MMMC also received capital improvement funding:

New dialysis unit—$7.2 million;

Improvements for OB, OR, skilled nursing, adolescent mental health services and other departments—$15 million;

“Green House” facility with 30 long-term care beds at Kula—$5 million.

Noteworthy health bills

SB415 requires licensure of home care agencies—important to ensure client safety;

SB166 puts insurance reimbursements for oral chemotherapy on par with intravenous therapy—allows more options for cancer treatment;

HB1379 creates a process for a patient to direct end-of-life treatment in a standardized physician form.

Small boat harbor improvements

Budget bill re-appropriates funds for pump-out, electrical and sewer improvements at Ma‘alaea Harbor—$2.5 million.

Bill status information

Find out more about the all-important biennium budget bill, HB200, CD1, along with itemized budget worksheets under “bill status and documents” at Also look there for funding updates pertaining to important Maui projects such as roads, hospitals, water infrastructure and some school projects. For a particular item, search using key words.

Rating the session

The 2009 Legislative session will get mixed reviews—there were some good bills adopted along with some very bad ones. I will hold a South Maui town meeting in the near future to give you a full report and answer any questions.

As always, please contact me with any feedback and suggestions: email or call my office toll-free: (800) 984-2400, ext. 66070#.

A hui hou.



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