GOVERNOR’S STATEMENT ON COUNCIL ON REVENUES REVISED FORECAST

News Release from Office of the Governor Jan 8, 2014

HONOLULU — Gov. Neil Abercrombie today commented on the state Council on Revenues’ revised forecast, which includes an amended growth rate projection for fiscal year 2014 from 4.1 to 3.3 percent while leaving growth rates for fiscal year 2015 and beyond unchanged.

The Governor stated:

“My administration has submitted a supplemental budget that is able to accommodate revenue fluctuations – even slight declines – while furthering our initiatives to provide enhanced public services, recapitalize state reserves, address long-term liabilities, invest in public infrastructure, and support preservation efforts.

“The Council on Revenues’ forecast supports my belief that Hawaii’s economy is already running at peak conditions. Although the adjusted forecast suggests slightly reduced potential revenues in the current fiscal year, the amount is very modest and manageable in the state’s financial plan. The revision in the forecast is more reflective of what has been substantial revenue growth over the last two fiscal years.

“Additionally, our success in reaching collective bargaining agreements for most units allows us to focus on our initiatives within a sound six-year financial plan that embodies a degree of predictability necessary to navigate future fluctuations.

“Because of our prudent fiscal management, we have a healthy positive balance from the end of fiscal year 2013 as we move forward on our long-term financial plan.”

State Finance Director Kalbert Young added:

“A forecast of 3.3 percent growth is still a good optimistic rate of growth for the state. It does recognize the substantial rate of growth in the last two years and, at 3.3 percent, is more than sufficient to deliver all the components and expectations afforded in the state budget and six-year financial plan.”

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Background: Just in Time for the Budget: Economic slowdown leads to downgrade in revenue forecast