A year ago this month, just days after his swearing in, Gov. Neil Abercrombie’s ambitious plans to have a “New Day” for Hawaii fell into a budget sinkhole.
The man who had campaigned as a sunny optimist seemed to have a rain cloud hovering above his head as he announced the news that the state faced an $843 million shortfall through fiscal year 2013. (It would soon grow to $1.3 billion.)
By the end of the press conference at the Capitol’s executive chambers last December, the rain cloud had turned to a thunderstorm, as Abercrombie angrily defended his plans in front of questioning reporters.
What a difference a year makes.
On Thursday, with his budget director and the chair of the Chamber of Commerce of Hawaii’s board at his side, the governor stood at the beginning of a press conference to announce a $1.3 billion sale of general obligation bonds.
He stood, he said, because he was so enthusiastic about the news. Later, he punctuated remarks made by Budget Director Kalbert Young with an audible “Yes!” and gave the Chamber’s Ginny Pressler a high-five.
Pressler described the bond sale as a “major accomplishment” not only for the state but for the entire economy.
“This is a major gift to the business community,” she said.
The bond announcement is a shiny capstone to a rough year, arguably the young administration’s greatest accomplishment. While he stopped short of flat-out gloating, the governor made it clear that he and his team deserved credit.
“About a year ago, just a year ago this week, we inherited a fiscal nightmare,” he said. “I asked at that time and in subsequent weeks and months, as the legislative session unfolded, for everyone in our canoe here in Hawaii to all put their paddles in the water and pull deep — that we all had to sacrifice. We faced a tidal wave of debt and deficit … that threatened to swamp our canoe.”
Because of “tough decisions” and the facing of “hard truths,” the canoe was righted, he said. Investor confidence in the state, he said, as illustrated by the bond sale and affirmations from national credit-rating services, validated that leadership.
“You can’t do better than that,” said Abercrombie. “The game plan is working.”
New Life for New Day
Abercrombie acknowledged Thursday that the fiscal “nightmare” (he used the phrase several times) he says he inherited from former Gov. Linda Lingle put a “severe strain” on his New Day plan to reform the state.
He recounted some of the things he said earlier this week in an interview with Civil Beat, including how the budget situation was continually in flux during the 2011 Hawaii Legislature. The tough decisions, he said, included cuts to public welfare programs and union benefits.
As a result of the bond sale, the state will be able to replenish the Hurricane Relief and Rainy Day funds and to infuse new money into various capital improvement projects. Abercrombie believes the state’s fiscal stability will trigger “a surge of confidence” across the state. His administration is already meeting with departments and legislators to see where the state can “move forward” and “keep this turnaround going” rather than retrench.
“This is a happy occasion to be picking and choosing,” he said.
The “positive balance” and “fiscal order,” Abercrombie feels, means the state will be able to “take care of any ups and downs.”
How the Legislature will receive the message remains to be seen. Unlike Abercrombie and Lt. Gov. Brian Schatz, all 76 lawmakers are up for re-election in 2012. Legislators tend to be hesitant to make bold moves in an election year.
Of note: State Rep. Kyle Yamashita accompanied Kalbert Young and other finance officials on their trip to New York and San Francisco this fall to secure the bond deal.
But, barring some economic catastrophe, Abercrombie is sure to enter the “second quarter” of his term claiming that his “team” has a lead and is aiming for the end zone.
“The referee came in and made that call at the end of the first quarter,” he said, later adding with a sly smile, “At half-time, the public will be making a judgment as to whether this good news has been translated into jobs and needed projects.”
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