Budget director Kalbert Young with Gov. Neil Abercrombie
Budget director Kalbert Young with Gov. Neil Abercrombie
Budget director Kalbert Young with Gov. Neil Abercrombie

HONOLULU – Gov. Neil Abercrombie, along with Attorney General David Louie and Finance Director Kalbert Young, announced a plan today to address an inconsistency in the amount of approximately $444 million between the budget bill and the bond authorization bill passed by the Legislature that is preventing each bill from being signed into law.

“The proposed solution is the most efficient path to resolving this situation without the need for any additional costs to the taxpayer,” Gov. Abercrombie said. “I have consulted with the Speaker of the House, Senate President and the Department of Education. Working together, we believe we can enter the new fiscal year with a functional budget.”

The Department of the Attorney General and the Department of Budget and Finance advised the governor that the projects authorized in the Budget Bill (HB1700) exceed the amount certified in the Bond Declaration Bill (HB1712).

“Due to legal issues, I have advised the governor that he would not be able to sign the executive supplemental budget bill for fiscal year 2015 in its current form,” said Attorney General David Louie. “In addition, once the budget bill is reconciled, the Bond Declaration Bill could be signed no earlier than July 1, 2014.”

The Department of Budget and Finance reviewed the appropriations and declaration bills and was able to identify that the sources of the discrepancies were in the areas of state educational facilities improvement (SEFI) authorizations, the Judiciary budget, standalone appropriation bills and lapsed projects.

“We were able to pinpoint specific areas that were omitted in the bills passed by the Legislature and have concluded that it will require the governor to reconcile these bills in order to begin the new fiscal year, which starts July 1, with a working supplemental budget,” said Director of Finance, Kalbert Young.

Working with legislative leaders and the Department of Education (DOE), Gov. Abercrombie’s proposed solution would temporarily reduce the general obligation bond appropriation of SEFI projects through a line-item reduction in the budget bill. The total amount of bond projects authorized in HB1700 will therefore not exceed the amount certified in the bond declaration bill HB1712. This would be predicated on the need that the Legislature make-whole the amount reduced from the SEFI authorization when it reconvenes in regular session in January 2015. The DOE confirmed that it will plan to minimize impacts on projects already in the queue. This will necessitate a degree of project management and coordination that was not previously anticipated.

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