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Hawaii Gov: Budget top priority for upcoming year

Anita Hofschneider, Associated Press

HONOLULU (AP) -- Hawaii Gov. Neil Abercrombie says the state budget is his top priority for this coming year, in addition to energy and education.

The governor detailed his priorities during the annual State of the State address to lawmakers at the state Capitol on Tuesday.

"We have now turned a fiscal corner," he said, saying that the state's finances are stable compared to two years ago.

He said the government must now take care of pension deficits and other unfunded liabilities.

Abercrombie wants to budget $100 million for retirement benefits, specifically those categorized as Other Post-Employment Benefits. He also wants to re-invest in emergency funds.

Abercrombie said pay reductions for state workers will end in July. Employees took a 5-percent pay cut in 2011 following the state budget crisis.

The governor also wants to stimulate the economy through construction investments. He said he has asked Lt. Gov. Shan Tsutsui to take the lead on this initiative.

In addition to fiscal measures, Abercrombie is establishing a task force to research Hawaii's energy options and wants to amend renewable energy tax credits.

He also wants to implement a new preschool education program, increase the minimum wage by $1.50 and improve environmental protections. The governor's budget proposal includes about $31 million for early childhood education over the next two years.

House Minority Leader Aaron Ling Johanson called Abercrombie's speech "a good, ambitious agenda" but questioned the funding source.

"A measure of fiscal prudence is in order," he said.

Lawmakers also questioned the feasibility of the governor's preschool education plan.

House Majority Leader Scott Saiki said the program may require a constitutional amendment before it can be implemented. Senate President Donna Kim agreed.

The Hawaii state constitution says that the government can't fund private educational institutions —which rules out school voucher programs.

Kim said that the state would have to review the needs of existing K-12 programs before committing to a new preschool venture.