Nonprofits ask Lingle to release $23.7 million appropriation

The Hawaii Legislature in the 2010 session appropriated $23.7 million from the Emergency and Budget Reserve Fund – the so-called “rainy day fund” – to pay for 42 state programs and for nonprofits to maintain various programs this fiscal year. The bill became law without Gov. Linda Lingle's signature.

After state Budget Director Georgina Kawamura told the Legislature on Oct. 25 that the administration would not yet release the money, blaming the “weakened national economy,” PHOCUSED, a group of health and human service nonprofits, called for gubernatorial candidates to express where they stand on releasing these funds.

In addition, Alex Santiago, executive director of Protecting Hawaii's Ohana, Children, Under Served, Elderly and Disabled, or PHOCUSED, said “We are hoping upon hope that this administration will reconsider its position and release the funds in the second quarter.”

Candidates Neil Abercrombie and James “Duke” Aiona disagree how soon the emergency funds should
be released. Democratic candidate Abercrombie said after Kawamura’s announcement that he would release the funds. Aiona’s campaign said Oct. 28 the Republican candidate would “seriously consider” releasing the money.

Travis Taylor, Aiona campaign spokesman, said Aiona will look at all appropriated funds after the state Council on Revenues’ December forecast. “If the next governor is going to be a rubber stamp for the state Legislature, as the case would be with our opponents, Hawaii would be operating in the red like they do in Washington,” Taylor said.

Hawaii governors have the executive power to withhold appropriated funds. In July, Lingle said, “I have instructed the departments to not take actions to consider any of the proposed appropriations in this bill until after the first quarter of fiscal year 2011 is completed and updated Council on Revenues estimates are available.”

At its September meeting, the Council on Revenues predicted a first-quarter 2 percent revenue growth for this fiscal year, which began in July. This was lowered from the council’s previous 6.2 percent growth, but the older figure included the delayed payouts of individual tax refunds earlier this year.

Council Chairman Paul Brewbaker said the projection is the same once the delay is factored out. The council sees steady 6 percent growth over most of the decade. "The underlying expectation of economic recovery seems to be playing out as we expected," he said last month. "The re-acceleration of the economy locally has occurred."

Abercrombie said he views the appropriations as contracts to these organizations that should be honored. He said, "The state is obligated to take care of these elements that are associated with all of these things – Healthy Start program, prenatal care, mental health services, substance abuse treatment.”

Abercrombie said the money is operational cash that has been authorized and appropriated by the Legislature. “You can’t ask people to perform a service and tell them, ‘You're not going to get paid.’ If that was done by these [nonprofit] agencies, we’d have them in court.”

Taylor said Abercrombie's call for an immediate release of money is premature. “Our opponent is making blind promises, which is simply irresponsible,” he said.

If the money is not released, nonprofits have indicated key services will be cut. For example, Catholic Charities Hawaii is owed $350,000 for services at the Lanakila Multi-Purpose Senior Center, which services more than 2,000 seniors on a $400,000 annual budget. "It really is a preventative program to prevent institutionalization,” Jerry Rauckhorst, Catholic Charities president and CEO said.

Lawmakers also budgeted $200,000 for Adult Friends for Youth, a youth-gang prevention and intervention service. “Many of our kids give back to their communities. They become productive, they give back in taxes,” said Adult Friends President Deborah Spencer-Chun. “If they don't do that (release state funds), they’ll continue to drain.”