Hawaiʻi Gov. Josh Green on Monday signed legislation appropriating nearly $40 billion for the state’s executive budget over the next two years.

But that amount was $110 million less than what was approved by the Legislature last month in House Bill 300. Most of it will come from the state Department of Education’s budget.

The reductions are due to uncertainty in federal funding and a lowered forecast for tax revenues by the Hawaiʻi Council on Revenues, according to a press release from Green’s office.

At a Civil Beat forum earlier Monday the governor said the biggest federal cuts — if they come — would probably be to Medicaid and food benefits programs.

Congress this week is debating the Trump administration’s domestic agenda bill, which aims to extend tax cuts and cut spending but would also add to the federal debt.

While Green’s line-item vetoes amount to less than half a percent of the budget for fiscal years 2026 (which begins Tuesday) and 2027, there will be $90 million less for school support operations in the Department of Education.

The DOE will now receive $380 million in 2026 and $378 million the following year. The entire DOE budget is around $2.6 billion in each of the next two years.

Also taking a sizable hit is the adult mental health inpatient program for the Department of Health, which will get $157 million and $378 million over the next two years, a reduction of $10 million. The entire DOH budget is roughly $900 million in each of the next two years.

The reductions are posted in a governor’s message sent to Senate President Ron Kouchi and House Speaker Nadine Nakamura on Friday.

There was no immediate response from House or Senate leadership on the line-item vetoes.

In the press release, Green said the budget funded “essential initiatives.”

“With federal funding cuts looming, our state cannot afford to work in silos,” he said in a statement. “This budget reflects the collaboration between our legislators and our departments to prioritize critical funding efforts for the betterment of our people and for the health and stability of our state’s budget.”

Those priorities include providing temporary housing, combating invasive species, addressing wildfire recovery and helping schools upgrade facilities and keep the lights and AC on. Among the highlights of HB 300 are:

• $26 million and 44 positions for biosecurity;
• $37 million for kauhale (tiny homes) development projects for homeless people;  
• $12 million for the Disaster Case Management Project to continue Maui wildfire recovery efforts;
• $15 million for statewide highways fire mitigation;
• $30 million for electricity costs for the schools; and
• $60 million for deferred maintenance for the DOE.

Also allocated is $5.6 billion for capital improvement projects — that is, statewide construction projects. And the budget includes $1.8 billion in general obligation bonds for the next two years.

“Exercising fiscal prudence is necessary to stabilize the state budget and a critical, comprehensive analysis of the cuts was conducted to sensibly use state resources,” according to Green. “Each line-item veto took into consideration each department’s capacity and feasibility to fulfill projects, as well as the availability of other funding sources to sufficiently support vetoed items.”

Civil Beat’s reporting on the Hawaiʻi State Legislature is supported in part by the Donald and Astrid Monson Education Fund.