Hawaii Lawmakers Closer to a Deal on Minimum Wage While Budget Stalls
One might say that the prospects of raising Hawaii’s minimum wage turned on a dime Wednesday.
The Senate has fought for a $10.10 wage all session, including as recently as Monday.
Now, Senate conferees on say they are willing to scale the wage back to $10 an hour, as the House has proposed.
Differences remain: The Senate wants the wage, currently at $7.25 an hour, increased in increments with the $10 amount reached by 2017 鈥 not 2018, as the House prefers. And the Senate still wants a 25 cent tip credit while the House has pushed for 75 cents.
One senses, however, that the two chambers are moving closer to something each side can live with. The Senate says it will still accept the $7 “trigger” the House came up with: When a waiter, for instance, makes that amount in tips above the minimum wage, restaurants can deduct the tip credit.
“The House will take some time to consider this,” Rep. Mark Nakashima told his counterpart on SB 2069, Sen. Clayton Hee, after Hee informed him of the latest conference draft. “On this one, shall we come back tomorrow?”
Hee paused before answering 鈥 a little drama.
“I guess so, because we might be sending something to you tomorrow and Friday,” he finally replied, as the conference room audience chuckled, well aware that Friday is the deadline for all legislation this session. “We keep trying.”
“We appreciate the Senate’s willingness to keep trying,” said Nakashima.
Said Hee, “We are single-minded on this issue.”
While Hee and Nakashima bargained, supporters of a wage increase 鈥 including faith-based groups and social-justice advocates 鈥 and opponents 鈥 restaurant owners and business groups 鈥 waited patiently in the conference meeting room for the latest on SB 2609. The latter group is largely resigned to the fact that Hawaii’s minimum wage is going to increase; the question is, can it be increased more gradually to help businesses absorb the costs?
Don’t be surprised if SB 2609 continues to evolve as Friday evening’s deadline nears. In fact, that’s the case for a lot of bills; conferees introduced plenty of conference drafts Wednesday with the goal of improving legislation.
Ways and Means Chairman David Ige and Finance Chairwoman Sylvia Luke are still working out budget details.
That pattern and the exchange between Hee and Nakashima typifies the kinds of discussions going on throughout the Hawaii State Capitol during the conference committee period. And, as has also been the case all week, dozens of bills have been held up because House Finance Chair Sylvia Luke and Senate Ways and Means Chair David Ige have not finalized the state’s $12 billion operating budget.
Without a “release” on bills from the money committees, the most common expression from legislators Wednesday was not “We have a bill” but rather “Let’s roll it over to Thursday.”
Or Friday. Both days are shaping up to be hectic at the Legislature, with bill conferees rushing to and from conference rooms trying to reach agreement on legislation before 6 p.m. Friday.
Budget Stalled as Lawmakers Debate Turtle Bay Deal, Hotel Taxes
With two days until deadline, state budget negotiators didn’t make much progress after meeting for less than an hour Wednesday morning. A large crowd anxious to learn whether their programs would be funded packed the conference room and overflowed out into the hallway.
The budget conference committee chairs, Luke and Ige, said after the hearing that disagreements over what capital improvement projects to fund 鈥 namely, a land-preservation deal with Turtle Bay Resort 鈥 are the primary obstacles.
鈥淲e can only float so many bonds,” Ige said.
Still, the committee fully expects to finish its work on time. Ige said there will be 鈥渁bsolutely no extensions.鈥
Gov. Neil Abercrombie announced April 17 that state and city officials had reached a $48.5 million agreement with the Turtle Bay Resort developers to protect 665 acres on the north shore of Oahu.
The deal involves the city kicking in $5 million, a land trust pitching in $3.5 million and the state picking up the remainder to buy a conservation easement.
Lawmakers didn鈥檛 include the $40 million in the House or Senate drafts of the budget because the administration had told them the negotiations for concluding the agreement would stretch through the end of the year, Ige said.
Another problem in finalizing the budget stems from the governor鈥檚 initial submittal in December, which included $280 million for capital improvement projects from state operating funds instead of the traditional route going through the CIP budget, Luke said.
When the Council on Revenues downgraded the state revenue forecast last month to zero growth for 2014 and to 5.5 percent for 2015, lawmakers were left with almost half a billion dollars less than they expected to have to balance the biennium budget.
People anxious about legislation wait to enter the budget conference meeting.
As a result, budget negotiators moved the $280 million out of the operating budget and over to the CIP budget, which put them way over the debt ceiling.
鈥淭he challenge is that we started with having to identify $280 million in cuts just to get back to even,鈥 Ige said.
One of the bills that’s been held up as budget negotiators continue to wrangle involves hotel tax money, the main source of revenue for the counties after property taxes.
A House-Senate panel led by Sen. Gilbert Kahele and Rep. Tom Brower may be getting closer to a compromise on lifting the state cap on the counties’ share of the transient accommodations tax revenue.
The four counties currently get a combined $93 million of the TAT revenue since the state capped it in 2010. They used to get 44.8 percent of however much money the state collected each year to split among them.
Brower proposed lifting the cap over the next four years, giving the counties 33 percent starting July 1, 2014; 37 percent in 2015; 41 percent in 2016; and 44.8 percent in 2017.
Kahele indicated at the packed hearing 鈥 which included Kauai Mayor Bernard Carvalho Jr., Honolulu Mayor Kirk Caldwell, Big Island Mayor Billy Kenoi, Maui County Councilman Mike Victorino and staffers 鈥 that he would consider the proposal. Lawmakers are set to reconvene at 10 a.m. Friday.
One of the only money-related measures that did clear conference committee Wednesday was the so-called . Lawmakers approved $2.98 million for 32 claims against the state, which include settlements for injuries and discrimination.
Public Financial Disclosure Bill Clears Conference
State Rep. Angus McKelvey compromised with Hee on a bill to add 15 more boards and commissions to the list of those required to file public financial disclosure statements.
cleared the conference committee and is expected to pass the full House and Senate, but it鈥檚 unclear what the administration intends to do if it reaches Abercrombie’s desk.
There’s concern among lawmakers and others that he will veto the measure because the new requirement would apply to current board members who didn’t have to disclose their financial ties when they were first appointed. Many argue, too, that the disclosure requirement deters people from applying to serve on boards and commissions, most of which are unpaid.
The draft the Senate passed last month would have only added the three members of the Public Utilities Commission to the list of state employees who have to disclose their financial ties.
A cramped conference room as legislators craft the state budget.
The House draft added 16 more agencies, including the University of Hawaii Board of Regents, Board of Land and Natural Resources and Hawaii Community Development Authority.
The conference draft approved Wednesday, which Hee introduced, snipped two boards from that list 鈥 the Hawaii Labor Relations Board and the Labor and Industrial Relations Appeals Board.
Members of the LIRA board wrote lawmakers a letter in March that went so far as to suggest that passing the bill might somehow lead to suicide or murder because their decisions can be so controversial.
Many education bills were deferred Wednesday, as were decisions on legislation to boost the state’s lax lobbying laws and determine what should go to the counties for providing tourist-related services.
Consensus on Pre-K Funding, Raises for UH Professors
Luke blamed the downgraded revenue forecast for the conference committee鈥檚 decision to only provide $3 million for pre-kindergarten, far less than the $5.2 million requested but consistent with the governor鈥檚 scaled-down proposal.
Ige said the money is expected to go toward establishing pre-K classrooms at public schools, but he wasn鈥檛 sure how many that amount would be able to fund. Other requests for early education money are still being discussed, he added.
Budget negotiators also announced $2 million to restore funding cuts to school athletics programs and $15 million in funding that principals get to decide how best to use.
They also decided to add another $3 million and 39 positions 鈥 on top of the 50 agreed to last week 鈥 for the University of Hawaii鈥檚 West Oahu campus.
The committee agreed to provide $19 million for the pay raises negotiated by the University of Hawaii Professional Assembly, the faculty union.
鈥淓ducation was the winner today,鈥 Ige said.
Contact Chad Blair via email at cblair@civilbeat.com or follow him on Twitter at .
Contact Nathan Eagle via email at neagle@civilbeat.com or Twitter at .
