Hawaii lawmakers exceed spending cap

The $21.7 billion biennial budget approved by Hawaiian lawmakers has raised some eyebrows.

Lawmakers continued their high spending habits, said Keli‘i Akina, president and CEO of the Grassroot Institute of Hawaii.

"Their proposed budget exceeds the state’s legal spending cap by more than $1 billion, and while the state does have a budget surplus, I would think the lessons of the pandemic and lockdowns would have encouraged better budgeting and more fiscal restraint," Akina said in an email to The Center Square.

First-term Gov. Josh Green had some victories in the budget but also came up short in some areas. The Legislature included $280 million for a rental housing revolving fund to aid in the state's affordable housing crisis. Another $150 million is allocated to the Hawaii Community Development Authority to improve housing developments.

About $125 million in tax credits proposed by the governor passed the Legislature. But lawmakers defeated a request to adjust the state's income tax system for inflation or increase the standard deductions.

"Those measures combined would have saved Hawaii taxpayers an additional $194 million a year and protected them from tax increases far into the future," Akina said.

Also shunned was a $50 visitor impact fee proposed by the governor.

The highlight was the approval of an out-of-state physician compact that addresses the physician shortage in the Aloha state, according to Akina. The state is short the equivalent of 776 full-time physicians, according to a report from the Hawaii Physician Workforce Assessment Project.

"Joining the Interstate Medical Licensure Compact will make it easier for mainland doctors to set up practice in Hawaii, as well as put a dent in the state’s physician shortage," Akina said. "I hope next year the Legislature will enact licensure compacts for other healthcare professionals, such as nurses, psychologists and speech and audiology pathologists."

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