Gov. Neil Abercrombie‘s administration is on track to finalize $50 million in savings across all state departments this week, according to Hawaii’s budget director. But implementing the cuts could take months.
As part of the operating budget legislators approved in May, lawmakers built in two separate lump-sum savings of $50 million for fiscal 2012 and 2013. At the time, lawmakers said they were giving the Abercrombie administration the flexibility to come up with those cuts to “reprioritize state government.”
The governor announced his plan for the first $50 million in cuts in June, asking all departments to achieve cuts equal to 5 percent of their general fund appropriation for fiscal 2012 — after taking out estimated 5-percent labor cuts, debt service, health benefits and pension contributions and FICA costs. The University of Hawaii and the state-run community hospitals were asked to come up with cuts at three levels: $10 million, $15 million and $20 million.
In a June 16 memo to all department heads, Abercrombie set the following schedule:
July 25-29 Departments meet with Budget and Finance and Governor’s office to discuss preliminary budget reductions
Aug. 1-5 Departments meet with Governor, as necessary, to discuss budget reductions
Aug. 8 Budget reductions and full year allocations are distributed to departments
Aug. 9 Departments begin implementation of budget reductions
“We’re still within the window of our schedule,” Hawaii Budget Director Kalbert Young told Civil Beat Monday. “The process is still under way, but we expect to be completed before the end of the week.”
Young declined to give details on the cuts while plans are still being finalized.
But he did say that some of the reductions “are not really cuts.” He described some of the proposed savings by departments as “creative.”
“These aren’t just solely cuts, or flat-out cuts” he said. “It’s a lot of the ‘restructuring’ concept — moving things around and funding programs through different ways.”
He did note that some of the restructuring would require legislative approval — meaning any potential savings wouldn’t be realized until early next year when lawmakers reconvene.
“In the end, they’ll have to equal up to $50 million over the course of the current fiscal year,” Young said.
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