"We want to reassure the public that there will be no budget shortfall, and public services will not be cut or delayed, as has been claimed." Robert Piper, Deputy director, Budget & Finance on 7/20 Kauai Garden Island and 7/22 Honolulu Advertiser.
"The state Department of Budget and Finance told the Department of Education that it would not release $110 million out of $235 million appropriated by lawmakers from the general fund in the past two legislative sessions. The restrictions could delay construction work for at least eight months in about 55 of 96 public schools that are first in line for repairs." Honolulu Star-Bulletin, 7/22.
"They ignore the fact that with the state collecting $150 million more in revenues in fiscal 2007 than 2006, there is ample money to keep state services at the same level, if not increase them." Ted Liu, DBEDT Director, Honolulu Star-Bulletin, 7/22.
"On July 1, 2007, departments will receive their respective budget allocations for the first quarter only. Full-year allocations are targeted to be available by September 15, 2007....Please be alerted that budget restrictions may be imposed in September should the current revenue condition continue." Governor Linda Lingle, Exec. Memorandum No. 07-01, 6/27.
Can you please have somebody explain what the less-than-forecasted revenue stream means for the general fund balance at the close of the fiscal year?
ReplyDeleteIn a nutshell, I am curious if the Constitution's trigger for a tax refund has been (or will be) met, or if tax revenues growing by less than 5% also means that the GF balance will be insufficient to trigger the refund/credit clause.
Doug, I've forwarded your question to Finance and will have them post an answer.
ReplyDeleteDoug,
ReplyDeleteThe exact language from the State Constitution, Article VII, Section 6 is: "Whenever the state general fund balance at the close of two successive fiscal years exceeds five percent of general fund revenues for each of the two fiscal years, the legislature in the next regular session shall provide for a tax refund or tax credit to the taxpayers of the state, as provided by law.
We hit 5% in FY05 and FY06, triggering a refund in the 2007 session. If we hit 5% again in FY07, which we should know in a couple of days, that will trigger another refund in the 2008 session. If not, the two successive years starts over again.
Mahalo!
ReplyDelete