SB1679.DOC

SECTION 1. In 1999, the legislature established the emergency and budget reserve fund as a temporary supplemental source of funding for the State of Hawaii in times of emergency, economic downturn, or unforeseen reduction in revenues. As set forth in section 328L-3, Hawaii Revised Statutes, specific purposes for the fund include the maintaining of levels of programs determined to be essential to public health, safety, welfare, and education.

The legislature finds that the national and global economic crisis has caused significant economic problems in numerous industries in the State, including the airline, cruise ship, tourist, and construction industries. Mass layoffs have been reported by an increasing number of Hawaii businesses statewide, from the agricultural sector to the medical services sector. Hawaii's automobile dealers have cut fifteen per cent of their workforce and that percentage could double in the future. Financial uncertainty has caused decreased visitor arrivals and low hotel occupancy rates have caused layoffs and reductions in employee hours. Furthermore, recent forecasts show that the situation will worsen with a continued decline in jobs, personal income, and visitor arrivals, and rising inflation.

Difficult economic times and declining tax revenues have resulted in budget cuts for all state services. State departments have been asked to lower their budget proposals by up to twenty per cent. The department of education faces a possible $70,000,000 shortfall for the next academic year and funding has discontinued for science textbooks and materials, programs for literacy training for learning-disabled children, as well as for speech pathologists, occupational and physical therapists, and more than two hundred other positions.

The department of health has projected a $25,000,000 shortfall for mental health services and a $5,400,000 shortfall for developmental disabilities services in the current fiscal year. Funding has been eliminated for the healthy start program, totaling approximately $22,000,000 for the biennium. Additionally, the governor has discontinued funding for the keiki care program, which may leave an estimated one thousand five hundred gap group children without access to affordable healthcare.

The current and impending situation jeopardizes the safety net of basic human service, health, and education needs for Hawaii's residents and families. And while all of Hawaii's residents will be affected by the situation, gap group families and families closest to the poverty line will suffer the most.

The legislature finds that expenditures from the emergency budget and reserve fund established by Section 328L-3, Hawaii Revised Statutes, are needed to meet the conditions of emergency, economic downturn, and unforeseen reduction in revenue that the State currently faces. Further, the legislature finds that the appropriations in this Act are consistent with the purposes of the emergency budget and reserve fund.

The purpose of this Act is to appropriate moneys from the emergency and budget fund of the State of Hawaii to maintain the levels of programs determined to be essential to education, public health, and public welfare.

SECTION 2. There is appropriated out of the emergency budget and reserve fund of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2009-2010 and $ or so much thereof as may be necessary for fiscal year 2010-2011 for the department of health, pursuant to section 328L-3(d)(1), Hawaii Revised Statutes.

The sum appropriated shall be expended by the department of health for the purposes of this Act.

SECTION 3. There is appropriated out of the emergency budget and reserve fund of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2009-2010 and $ or so much thereof as may be necessary for fiscal year 2010-2011 for the department of human services, pursuant to section 328L-3(d)(1), Hawaii Revised Statutes.

The sum appropriated shall be expended by the department of human services for the purposes of this Act.

SECTION 4. There is appropriated out of the emergency budget and reserve fund of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2009-2010 and $ or so much thereof as may be necessary for fiscal year 2010-2011 for the department of education, pursuant to section 328L-3(d)(1), Hawaii Revised Statutes.

The sum appropriated shall be expended by the department of education for the purposes of this Act.

SECTION 5. This Act shall take effect on July 1, 2009.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	1679
TWENTY-FIFTH LEGISLATURE, 2009
STATE OF HAWAII