Lt. Gov. James “Duke” Aiona vetoed a bill today that would have prevented investors from claiming high-technology tax credits for three years to help with the state’s budget deficit.

The bill would have saved the state an estimated $93 million next fiscal year and millions more the following two years.

But investors had threatened to file a lawsuit against the state if the tax credits popularly known as Act 221 were suspended. Investors argued that it was unfair, and possibly unconstitutional, to suspend credits for investments that had already been made.

Aiona said the bill would have damaged Hawaii’s reputation as a place to do business. He also said the bill could have caused an adverse impact on investment as the state moves toward economic recovery.

Aiona said the recent forecast by the state Council on Revenues gives the state more flexibility to manage the budget deficit. In May, the council projected that revenues would come in higher than expected in the last forecast in March. State lawmakers had used the March forecast when drafting the state budget.

Aiona is acting governor while Gov. Linda Lingle is on a two-week trade and tourism promotion trip to China and Japan.

The Lingle administration has not decided what to do about a separate bill that ended the Act 221 program early – in May instead of December – which would save the state an estimated $13 million.

Aiona said he has recommended to Lingle that the bill be vetoed.