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Hawaii lawmakers on Wednesday cleared the financial hurdles out of the way for Kulani Correctional Facility to reopen on the Big Island.

A joint House and Senate conference committee signed off on staff positions and millions of dollars in funding necessary to move forward with the plan to reactivate the prison, which was closed in 2009 as a cost-saving measure. The prison’s reopening is a key part of Gov. Neil Abercrombie‘s plan to bring Hawaii inmates home from mainland facilities.

The decision was part of the committee’s ongoing negotiations to resolve the differences between the two versions of the roughly $24 billion biennium .

House Finance Chair Sylvia Luke said after the late-night hearing that the committee expects to finalize the operating side of the budget by early next week so lawmakers can turn their attention to capital improvement projects and numerous appropriations bills before the legislative session ends May 2.

The other big news Wednesday evening — that teachers ratified a four-year contract agreement — percolated through the Capitol as the committee worked on the budget bill. The pay raises and better benefits approved in the new deal will have a significant impact on the budget.

“That is going to be a big financial hit,” Luke said. “Initially, the governor’s financial plan accounted for a 2 percent increase. The teacher pay raise, what was ratified, is about 3 percent.”

She said it will come down to prioritizing.

“Anytime there’s any kind of agreement or arbitration award or settlement, it sets a precedence for all the pending negotiations,” Luke said. “UPW is still out there. HGEA is still out there. Even the nurses contract, the arbitration award came down but that’s for the last fiscal year.”

She said the overall impact in terms of cost is unknown at this point, but it’s something that will be part of the ongoing budget balancing act.

“To fund some of the collective bargaining raises, we have to balance that to some of the initiatives and some of the other programs or bills that are out there,” Luke said, noting the governor’s multi-million-dollar information technology initiative.

Senate Ways and Means Chair David Ige praised the new teacher contract agreement.

“Teachers are worth every penny that they get,” he said, adding that educating children is the most important job in state government. “We’re glad the governor and the union has come to a fair agreement. We are looking forward to getting the details of what it will cost and ensuring we can afford to make the payments.”

Kulani Decision Means Bringing More Inmates Back to Hawaii

Opening the Kulani Correctional Facility is part of Gov. Neil Abercrombie’s Justice Reinvestment Initiative. Bringing the Big Island facility back online will allow the state to bring home 200 inmates from mainland prisons.

There are roughly 1,700 prisoners housed out of state, primarily in Corrections Corp. of America facilities in Arizona. against the state and CCA by families of inmates who have been killed in those prisons.

The budget decisions will also establish a community-based program so the prisoners will have the services they need to reintegrate into local communities, Ige said.

“It’s actually not new money or new positions because there was so much money out there that we’re paying for private contracts on the mainland,” Luke said. “It’s just shifting that money locally.”

Ted Sakai, the state Public Safety director, has said reopening the facility will return almost $5 million to the local economy and reduce recidivism rates.

In addition to the Kulani votes, the committee made significant progress in a lot of other areas of the budget – in particular, regulatory functions of the government.

In the Department of Agriculture, for instance, the committee voted to add or restore positions that were cut during the economic downturn, including plant inspectors and detector dogs. Ige said it will help the state handle the movement of plants and materials between the islands.

Senate Shows Flexibility in Cutting Vacant Positions

Senators also agreed to eliminate funding for more vacant positions.

The Senate had initially restored that money in its draft after the House cut it out to make the budget more transparent. But Ige said there will be some flexibility as the state makes this transition.

“We’re working with the House and Chair Luke and trying to be smart about reviewing the vacancies and making reductions when appropriate,” he said. “We’re committed to trying to work with the departments. Quite frankly, the only tool that the executive branch has had to manage the budget has been to really hold positions vacant.”

Ige said lawmakers want to “clean up and true up” the budget, but have to be realistic about how they do it. Department heads have said they have had to hold positions vacant to make electric payments or fund overtime.

“We are trying to be reasonable as we evaluate it but we are also making a commitment to making the budget be more transparent,” he said.

Still, Luke said nothing was set in stone.

“Everything is still kind of on the table,” Luke said. “The budget is still open for discussion and anything could happen between now and when we actually officially close the budget next week.”

The conference committee will reconvene next Monday at 7 p.m.