Even if some points are docked for style, the substance of what lawmakers did this past session has to earn fairly respectable grades. They made some strides in passing bills that direct help to families struggling to cover basic financial needs.
That is not to dismiss the problems of a session that seemed to end in some budgetary confusion and frustration, especially on the House side. As the 2023 session wound to a close on Thursday, House members complained that the eleventh-hour dealmaking to hammer out a budget agreement was opaque, even to them.
Even some of those who sat on the conference committee to reach a deal had only a murky understanding of the budget details they were moving out for a floor vote. On its face, that’s a poor outcome for a Legislature that already has been criticized for a lack of public transparency on how it does business.
On the specifics, some worried that the state Department of Education and the University of Hawaii are among the budgetary losers this year, reporting that the DOE in particular is receiving $65 million less than what Gov. Josh Green had requested.
State Rep. Kyle Yamashita, who chairs the House Finance Committee, said the budget allows some leeway for the governor to find money squirreled away throughout its line-items and supplement what’s going to schools, UH and possibly the Hawaii Tourism Authority; the latter got no allocation in the spending plan.
Especially given the continuing needs of schools to recover from the learning losses of the COVID-19 years, Green should do what he can to cobble together more resources needed for education, from kindergarten through college.
Other, principal victims of the pandemic economic disruption, of course, are those Hawaii families who are surviving on the brink of poverty. These are known as Hawaii’s “ALICE” families, a term that stands for “Asset Limited, Income Constrained, Employed” — the working poor.
On this front, the governor, as well as advocates for lower-income populations, believe the Legislature has made a good-faith initial investment in addressing their needs.
In a statement issued in the session’s waning days, Green touted the progress made toward goals outlined in his “Green Affordability Plan” (GAP).
“Generational tax reform to help ALICE families has begun,” he said, with the Legislature approving about half of the requested GAP proposals in his first session as governor.
On the tax code, he cited especially the move to double the earned income tax credit (EITC) and the food tax credit, and the improvements to the existing child and dependent care credit. Green had hoped for more broad-based tax relief, but lawmakers decided, correctly, that the budgetary realities did not support that.
Downward adjustments in projections for the state’s revenue surplus, estimated at the session’s start at about $2 billion, influenced that decision. In addition, there were major expenditures to work in, including a new union contract for public school teacher to cost an estimated $577 million over four years.
Even within those limitations, groups such as the Hawaii Children’s Action Network Speaks! were fulsome in their praise of steps taken on behalf of working families, including House Bill 954. That’s the bill to increase the various tax credits noted above, such as the refundable EITC and for child care, for lower-income households.
The lack of a broad-based reform benefiting more people disappointed more conservative groups such as the Grassroot Institute of Hawaii. In a written statement, its CEO, Keli‘i Akina, said that although he’s glad the Legislature is making a start at enacting relief, he holds out hope for “bolder tax reform” next session.
In fact, targeted relief was the right approach to take when there are so many competing demands on the budget. The $80 million allocated to enable the tax-credit improvements will be an especially impactful use of funds because it provides relief to those who otherwise could fall into homelessness and face other socioeconomic challenges.
Advocates also are celebrating what they see as effective expansions of the state’s Preschool Open Doors subsidy and its public pre-kindergarten programs. Both programs, currently open only to 4-year-olds, will be offered to 3-year-olds as well, if HB 961 is signed into law.
Among the other efforts made to deliver urgently needed services, lawmakers approved $50 million in capital improvement funds for the state-operated Hilo Medical Center. The appropriation will finance the construction and equipment for the intensive care unit, and expansion of the medical surgical unit. Hawaii island deserves these upgrades, so long overdue.
Finally, lawmakers deserve credit for making key housing investments, including $280 million over the next two years deposited in the Rental Housing Revolving Fund. Housing costs still take the biggest bite out of working-class incomes, which means that bridging the affordability “gap” will keep housing programs at the top of state priorities for the foreseeable future.