When a conference committee of Hawaii House and Senate leaders reached agreement on a state budget bill Monday — sooner than is typical — it was in marked contrast to the sense of stalemate that permeated the Capitol days earlier.

On Friday, some senators said House leaders were impeding their ability to move forward with conference committee hearings to negotiate the final language of bills. Fingers were pointed at Rep. Sylvia Luke, chair of the Finance Committee that controls virtually all legislation with money attached.

There were also accusations that Senate leaders were stalling progress on important measures, with Luke’s counterpart, Sen. Jill Tokuda, chair of the Ways and Means Committee, supposedly holding things up.

It’s all par for the course this time of year at the Capitol as the 2017 legislative session lurches to a close May 4.

House Finance Committee Chair Sylvia Luke, left, and Senate Ways and Means Committee Chair Jill Tokuda negotiated the state budget bill passed Monday by a conference committee they co-chair. Nathan Eagle/Civil Beat

Unanimous passage of the state budget bill by a conference committee co-chaired by Luke and Tokuda should shake free other measures that were hung up because the funding priorities had not been decided yet.

House Bill 100 provides a $28.4 billion two-year spending plan, with $14.6 billion coming from the state’s general fund. The committee also approved a $1 billion budget for capital improvement projects over the biennium, which starts July 1.

Highlights include more than $100 million to pay down the state’s unfunded liabilities, $1.5 million for agricultural loans, $157,000 for the long-term care ombudsman’s office, $500,000 for rat lung worm disease, $4 million over two years for the Department of Transportation to clear out homeless encampments around freeways and tens of millions of dollars to build schools in Ewa, East Kapolei and Kihei.

The budget still needs final approval by the full House and Senate, but as it stands now it would represent a $159 million reduction from Gov. David Ige’s revised proposal. He trimmed his initial request after the state Council on Revenues downgraded its fiscal forecast.

“Our ability to reach agreement on the budget reflects a shared belief that as resources are constrained, we must focus on priority needs that can be sustained,” Tokuda said. “Even as fixed costs and unfunded liabilities rise, our communities look to us to provide support for the most basic and essential programs and services from homeless and health care to protecting the environment and resources for our keiki and kupuna.”

A Closed-Door Process

The conference committee process unfolds mostly behind closed doors. The committees, each comprised of a handful of House and Senate members appointed by their respective chamber’s leadership, sit down to hammer out the differences between their versions of the legislation at hand.

They often hold a series of public meetings as they inch closer to an agreement. But each meeting generally consists of announcements on where they are at, as opposed to an open discussion about the bill.

With the budget bill, for instance, Monday marked the third time the committee had convened. Each meeting was one or two hours long, consisting almost exclusively of Tokuda and Luke rattling off the line items they had reached agreement on in a room packed mostly with department heads and other government officials eager to hear whether their budget requests would be funded.

There’s no public debate between the chairs or input from the other 26 members on the committee. Some lawmakers have said they do not know what will even be announced ahead of time.

With the other fiscal bills, the conference committee process includes updates on whether the Finance and Ways and Means committee chairs have signed off yet. Roam the Capitol halls this week and it’s not hard to find a lawmaker or lobbyist concerned about their measure having “WAM clearance” or “FIN clearance.”

HART Rail Salt Lake Boulevard Aloha Stadium2. Near Kamehameha Hwy. 23 feb 2017
Hawaii lawmakers are still negotiating a plan to continue funding the Honolulu rail project. Cory Lum/Civil Beat

For many bills, the House and Senate are able to work out the differences in the language of the legislation. But then the measure hits a financial bottleneck.

It’s why Luke and Tokuda wield so much power in the Legislature. They can almost single-handedly decide what measures survive and how much money each initiative receives.

Take Senate Bill 1183, for example, one of the biggest bills remaining this session.

Luke is less than thrilled with the Senate version of the plan to come up with more funding for Honolulu’s well-over-budget rail project.

The House wants to extend the 0.5 percent surcharge levied on Oahu’s general excise tax an extra two years; the Senate wants to extend it 10 years, to 2037 from 2027.

Honolulu Mayor Kirk Caldwell has said a two-year extension would only give the city an extra $1.2 billion, which would not be enough to finish the planned 20-mile, 21-station line from Kapolei to Ala Moana.

Luke, fed up with watching the project’s costs soar despite the mayor’s past assurances, wants the city pay more of the cost itself. The latest draft of the bill would require that the city lift its ordinance prohibiting the use of city money for rail construction, which means property taxes could be used to help finish the project.

Holding Up Unrelated Bills

Luke’s frustration over the Senate’s inclination to give the city a 10-year extension led her to hold up unrelated bills.

A conference committee meeting was not even scheduled for SB 1183 until Monday, frustrating some legislators.

Sen. Lorraine Inouye was frustrated last week by a holdup in scheduling conference committee meetings on key bills. Nathan Eagle/Civil Beat

Sen. Lorraine Inouye, co-chair of the conference committee considering the bill, said it seemed the Senate had been prevented from moving forward due to the “activity from the upper floors” at the Capitol, referring to the floors with the offices of House lawmakers.

“It’s unfortunate, you know, for the advocates of bills before us,” she said Friday. “We want to do the people’s work and I’m prevented from moving any of the conference bills. I really don’t know what’s happening upstairs, but certainly I hope that we can complete our work in conference for the rest of the days we have.”

House Majority Leader Scott Saiki said Monday that Luke has started to sign off on hearing notices. By Monday afternoon, SB 1183 had been scheduled for a hearing Wednesday morning.

“The holdup was the fiscal implications,” Saiki said, adding that the House needed to get a better sense of how much unrelated public union contracts are going to cost the state.

Contracts for all of the state’s collective bargaining units are up this year. Negotiations are ongoing for most, but a couple of unions have made preliminary deals.

The Hawaii State Teachers Association reached a tentative agreement Sunday with the Ige administration on a four-year contract that amounts to a 13.6 percent pay raise. Last week, the Hawaii Fire Fighters Association reached a deal for 2 percent raises in each of the next two years.

“As we hear more about the collective bargaining this week there will be a better sense of which fiscal bills are realistic at this point,” Saiki said.

‘There Needs To Be Some Control’

Senate President Ron Kouchi said senators are working to get their hearings scheduled. He would not comment on whether House leaders were holding up the process.

Kouchi noted some bills were continuing to advance. He said a conference committee on Friday passed House Bill 89, which continues the Hospital Sustainability Program for two years.

Speaking generally of the conference committee process, Luke said she and Tokuda essentially act as gatekeepers who have an eye toward how all the individual pieces of legislation fit into the broader picture — especially when it comes to money.

“Because it has a lot of financial implication, there needs to be some control,” Luke said last week. “We try to figure out how much we can afford within the financial realm and within the financial plan and what are the different priorities of the committees and the state.”

Another significant measure under consideration this week is Senate Bill 1290, which county officials from Kauai, Maui, Oahu and the Big Island are watching closely. Maui Mayor Alan Arakawa, Kauai County Council Chair Mel Rapozo and others were at the Capitol on Monday to see what happened in conference committee.

The bill determines how much money each county will get from the 9.25 percent transient accommodations tax that the state collects from hotel guests. The counties rely on these tourism dollars to fund emergency services, park projects, roads and various programs.

The Hawaii State Association of Counties is urging a conference committee to pass the Senate version of the bill that includes $108 million for the counties.

The counties used to each receive a certain percentage of the hotel tax revenue, which ebbed and flowed with the strength of the tourism industry. But the Legislature capped it a few years ago and has deposited the extra revenue into the state general fund.

The committee deferred SB 1290 to Wednesday.

The session began in January with 1,601 bills introduced in the House and another 1,317 in the Senate. That list has been pared to 345 measures that the two chambers are trying to come to terms on this week.

The deadline to submit fiscal bills for final reading by both chambers is Friday. For non-fiscal bills, the deadline is Thursday.

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