Senate Minority Fact Corrects Reported $1 Billion State Windfall

Media Reports Misrepresent Fiscal Ending Balances as Surpluses

News Release from Office of Sen Sam Slom, August 26, 2016

HONOLULU — Recent headlines reporting a $1 Billion surplus in the state general fund tell only part of the story.   While revenues modestly exceeded forecasts for the 2016 fiscal year ending June 30, the media fails to point out that every fiscal year ends with a carry-forward balance much of which is already committed in the next year’s budget.

The July Hawaii Senate Minority Financial Report on the General Fund shows an estimated fund balance for FY2016 of $890 million according to state budget data.  Now that the books are closed, that means about $110 million might be called a surplus.  But spending trends indicate that we could still be in the red by 2019.

The Hawaii Senate Minority report also reflects the governor’s plan to maintain restrictions on discretionary spending and project lapses to prepare for what the Council on Revenues agrees could be leaner times ahead.  The Council meets again on September 2 to analyze trends that could affect revenues and the budget.

“I’ve been in the senate long enough to know that one healthy indicator doesn’t mean we’re in the clear,” said Senator Sam Slom.  “We control what we spend, but revenues are another story.  We don’t control how people are doing on the West Coast, China or Australia and whether our visitor industry will remain strong.  The best policy is to hope for the best, but prepare for less.  We work hard in every office in this building to do that.”

Media has also suggested that labor unions are already jockeying for their share of the loot.

“I sympathize with local teachers who say they have some of the lowest salaries in the nation when adjusted for the cost of living,” Slom said.  “But we also have the lowest paid doctors, software engineers, architects, graphic designers and bike messengers.  If we treat this as a surplus, we should use it to help small businesses that create most of our local jobs, and provide relief to our overtaxed, overburdened residents who all shoulder the same high cost of living and taxes.”

Table:  General Fund Projections FY 2017-2021

The two highlighted columns show the effect of the $1,024 billion fund balance carry forward compared to the $890 million previously expected.  Source: http://hawaii-senateminority.com/open-budget.html

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About the Hawaii Senate Minority

Senator Samuel M. Slom has represented Hawaii’s 9th senatorial district since 1996.  The lone Republican in the Hawaii State Senate, Slom is presently the only single-member caucus in any legislature in the United States.  Slom serves on all Senate committees, sub-committees and special committees, is minority leader and floor leader, and is Vice Chair of the Senate Committee on Economic Development, Environment and Technology.  For further information on Senator Slom and the Hawaii Senate Minority, visit www.hawaii-senateminority.com.