Hawaii's public schools had their budgets slashed several times. To face additional cuts would mean further strain on our public education system.

Kristina Lawyer is a first grade teacher at Princess Victoria Ka'iulani Elementary. Monday, she saw Gov. Lingle talk about an across the board three day a month furlough program, or almost 14 percent of an employee's salary.

"It is going to be hard for people to be able to afford to stay here as teachers," said Lawyer who is finishing up her first year at Ka'iulani. "Some from the mainland who come here are not going to be able to stay."

Since teachers have to be here the entire school year, the governor's plan would simply mean a pay cut since public school teachers cannot take days off.

"We're still going to be doing the same amount of work and we're not going to be getting paid, so it doesn't really seem fair," said Lawyer.

Fourth grade teacher Paul Bauer says his school has already had to cut a lot from its budget. To trim more could be detrimental to Hawaii's public education system.

"I really don't know how people can survive," said Bauer, who has been teaching for 11 years. "We're just really getting by as is with what we're receiving."

Teachers say beyond their paychecks, Hawaii's students will be the ones who suffer.

"I didn't choose to be a teacher to work in a private school; I chose to work in public education and that's where my heart is to help students from all economic backgrounds," said Lawyer. "I think we need to have money going into these schools so that it can truly be an equal society where everyone can work hard and be successful in life."

Trying to swim upstream in a downturn economy.

The Department of Education says it's too early to tell what all this means. For the time being, they're just trying to get through this school year, but they are nervous about the upcoming school year in August.

Those in the medical field, are also concerned, about how the proposed budget cuts, will affect the health care system.

Last year, Hawaii's hospitals lost $150 million. The year before, they lost another $150 million. They say, health care should fall under essential or "core" programs, since hospitals need medical professionals every day to take care of patients.

"Our charity care increasing every year and we're really worried as to what's going to happen this year because so many people are out of work," said Richard Meiers, Healthcare Association of Hawaii's president and CEO. "They may not have insurance and we take care of these people and we're going to see our charity care and our uncompensated care go up millions of dollars this year."

Hawaii hospitals claim they are not getting reimbursements they're supposed to get. So if they don't have money or if their funding gets cut, they can't pay their employees and medical suppliers to keep hospitals running.

By DERRICK DePLEDGE
Advertiser Government Writer

Gov. Linda Lingle today signed a bill into law that reduces pay for the governor, lieutenant governor, department directors, judges and state lawmakers by 5 percent and freezes their salaries through June 2011.

Lingle and state House and Senate leaders have described the bill as an attempt to lead by example as state workers are likely facing wage and healthcare benefit cuts in collective bargaining negotiations.

The governor signed the bill one day after announcing that, starting in July, state workers would have to take three furlough days a month for the next two years to help close the state’s budget deficit. The furloughs are equivalent to a 13.8 percent pay cut for state workers and would save the state $688 million.

In addition to the 5 percent pay cut, the governor, lieutenant governor and department directors would also take furloughs so they would share the same sacrifice as other state workers.

Pay raises for state lawmakers were the subject of populist anger on talk radio and newspaper opinion pages during a session when the governor and lawmakers were forced to cut state spending because of the recession.

Lingle initially urged lawmakers to give up a 36 percent raise that took effect in January but quickly backed away from the issue after realizing that executive and judicial branch leaders had already received large pay raises, while lawmakers had not.

A state salary commission, approved by voters in 2006, recommended 5 percent raises for the executive branch in July 2007 and another 5 percent in July 2008. Judges received a 10 percent pay increase in July 2007 and a 3.5 percent increase in July 2008.

By Leland Kim - bio | email

HONOLULU (KHNL) - Gov. Linda Lingle's (R-Hawaii) plan to balance the budget has alarm bells going off at Hawaii's public schools. She's proposing mandatory three days off a month without pay, or a 13.8 percent pay cut across the board at all state departments.

Hawaii's public schools had their budgets slashed several times. To face additional cuts would mean further strain on our public education system.

Kristina Lawyer is a first grade teacher at Princess Victoria Ka'iulani Elementary. Monday, she saw Gov. Lingle talk about an across the board three day a month furlough program, or almost 14 percent of an employee's salary.

"It is going to be hard for people to be able to afford to stay here as teachers," said Lawyer who is finishing up her first year at Ka'iulani. "Some from the mainland who come here are not going to be able to stay."

Since teachers have to be here the entire school year, the governor's plan would simply mean a pay cut since public school teachers cannot take days off.

"We're still going to be doing the same amount of work and we're not going to be getting paid, so it doesn't really seem fair," said Lawyer.

Fourth grade teacher Paul Bauer says his school has already had to cut a lot from its budget. To trim more could be detrimental to Hawaii's public education system.

"I really don't know how people can survive," said Bauer, who has been teaching for 11 years. "We're just really getting by as is with what we're receiving."

Teachers say beyond their paychecks, Hawaii's students will be the ones who suffer.

"I didn't choose to be a teacher to work in a private school; I chose to work in public education and that's where my heart is to help students from all economic backgrounds," said Lawyer. "I think we need to have money going into these schools so that it can truly be an equal society where everyone can work hard and be successful in life."

Trying to swim upstream in a downturn economy.

The Department of Education says it's too early to tell what all this means. For the time being, they're just trying to get through this school year, but they are nervous about the upcoming school year in August.

Those in the medical field, are also concerned, about how the proposed budget cuts, will affect the health care system.

Last year, Hawaii's hospitals lost $150 million. The year before, they lost another $150 million. They say, health care should fall under essential or "core" programs, since hospitals need medical professionals every day to take care of patients.

"Our charity care increasing every year and we're really worried as to what's going to happen this year because so many people are out of work," said Richard Meiers, Healthcare Association of Hawaii's president and CEO. "They may not have insurance and we take care of these people and we're going to see our charity care and our uncompensated care go up millions of dollars this year."

Hawaii hospitals claim they are not getting reimbursements they're supposed to get. So if they don't have money or if their funding gets cut, they can't pay their employees and medical suppliers to keep hospitals running.

By DERRICK DePLEDGE
Advertiser Government Writer

Gov. Linda Lingle today signed a bill into law that reduces pay for the governor, lieutenant governor, department directors, judges and state lawmakers by 5 percent and freezes their salaries through June 2011.

Lingle and state House and Senate leaders have described the bill as an attempt to lead by example as state workers are likely facing wage and healthcare benefit cuts in collective bargaining negotiations.

The governor signed the bill one day after announcing that, starting in July, state workers would have to take three furlough days a month for the next two years to help close the state’s budget deficit. The furloughs are equivalent to a 13.8 percent pay cut for state workers and would save the state $688 million.

In addition to the 5 percent pay cut, the governor, lieutenant governor and department directors would also take furloughs so they would share the same sacrifice as other state workers.

Pay raises for state lawmakers were the subject of populist anger on talk radio and newspaper opinion pages during a session when the governor and lawmakers were forced to cut state spending because of the recession.

Lingle initially urged lawmakers to give up a 36 percent raise that took effect in January but quickly backed away from the issue after realizing that executive and judicial branch leaders had already received large pay raises, while lawmakers had not.

A state salary commission, approved by voters in 2006, recommended 5 percent raises for the executive branch in July 2007 and another 5 percent in July 2008. Judges received a 10 percent pay increase in July 2007 and a 3.5 percent increase in July 2008.

HSTA in the News

Hawaii's Public Schools Face Steep Cuts
Reported by: Brianne Randle
Email: brandle@khon.com
Last Update: 6/01 10:07 pm
Governor Linda Lingle's statewide address is only just sinking in....

"What we heard today is nowhere near what we envisioned, so it's a lot that we took in today. We're still kind of working thru all of this- it was a shock," said Pat Hamamoto, Superintendent of Schools.

Last week the DOE was faced with $166-million in cuts over the next 2 years. Now they must cut $384-million. That's an additional $110-million out of next years budget.

"We can't honestly tell you where $110-million can be found," said Garrett Toguchi, Board of Education.

That's the million dollar question. By law Governor Lingle cannot order furloughs for the DOE, but the DOE can.

"She said furloughs she can't do it, the DOE has to do it, but with the budget restriction she will place on the DOE, I don't think the DOE has any alternative," said Roger Takabayahi, Hawaii State Teachers Association.

Furloughs alone would cut 14% of a teacher's salary. And that ultimately means cuts to educational days for school kids.

"The outcome is clearly defined - kids will miss 36 days of school," said Takabayashi.

The Board of Education says that could be made up thru online courses.

"We're hoping there's ways we can serve more students with less teachers," said Toguchi.

With personnel making up 70% percent of the DOE's budget, it's the first place to look to cut. But they say it's also the last place they want to cut from. For now, everything is on the table. Including consolidating schools, increasing class size, and reducing programs.

"You may not see schools with nice cut grass, more schools with more hazards, those kinds of things," said Toguchi.

"Every parent ought to be concerned now going thru some cuts we've never envisioned before," said Hamamoto. "Oh yes the pressure is on."

The University of Hawaii must also cut $138-million from their budget over the next 2 years.

The three-day furloughs would amount to about an extra month that Hawaii public schools would be closed.

If there's no school, then there's no learning. The teacher's union said the governor's plan disrupts student lives.

"The student could potentially lose a lot to their instructional time," said union president Roger Takabayashi."

Schools superintendent Pat Hamamoto said, furloughs are just one of several options she and the Board of education will continue to discuss.

"We've also talked about what it would be to do some consolidation of schools," said Hamamoto, "we've talked about maybe increasing class size, but those thing need to be worked out with the union."

But if the furloughs go through, teachers stand to lose a sizable chunk of their paychecks. Right now, a teacher on the high end of the pay scale gets $79,000 a year. With the proposed 14% pay cut, that same teacher would lose just over $11,000.

Takabayashi said, "I can foresee foreclosures, repossession of vehicles, it's a drastic thing that's going to happen to teachers."

There are 22,000 employees within the Department of Education. Of those, 13,000 are teachers. Will Fatafehi is one of them. The former paralegal took a huge paycut to teach math. He's had to recalculate the expenses in his life.

"I'm probably doing more of the home lunch thing as opposed to eating in the cafeteria," he said.

As it is, some teachers hold second jobs. McKinley High's principal says there are a few on his staff who work in retail to supplement their income.

"Just missing a paycheck is really impactful for their whole lifestyle as far as rent, mortgage," said principal Ron Okamura.

Hamamoto said, "I've been in the department going on 30 plus years and we've had cuts before but nothing like the depth we're talking about now."

The University of Hawaii is also facing cuts. The school said it's looking at the governor's plan and will be talking about it with its chancellors, the Board of Regents and union leaders.

Gov. Linda Lingle said yesterday she would order state workers to take three days a month in furloughs for the next two years and would scale back state healthcare benefits for low-income adults to close what she described as a $730 million budget deficit.

The furloughs — 72 days in all — would start in July and are equivalent to a 13.8 percent pay cut for the state's 46,000 workers. The governor said furloughs would save the state $688 million, while the remainder of the deficit would be closed by $42 million in spending cuts to state healthcare benefits for low-income adults.

Lingle said the state would delay paying $130 million worth of bills to get through the fiscal year that ends this month.

The governor's plan followed a new forecast issued last week by the state Council on Revenues that stripped $611 million from expected revenues through June 2011. After the governor met with her budget advisers over the weekend, she estimated that the revenue losses and a lower-than-expected take from tax increases passed by the state Legislature would result in a larger gap of $730 million.

"In short, we now have a government that we cannot afford," a gloomy Lingle said in a live, televised address from her chambers at the state Capitol.

Leaders of the state's public-sector labor unions reacted with disappointment, arguing that state workers would have a disproportionate share of the burden. Economists cautioned that furloughs could reduce consumer spending by state workers during a recession.

State House and Senate leaders accused Lingle of negotiating with labor unions through the media rather than collective bargaining. The governor had sought about $300 million in labor savings through contract negotiations, but her furlough plan would more than double that amount.

State Senate President Colleen Hanabusa, D-21st (Nanakuli, Makaha), a labor attorney, also questioned whether Lingle has the authority to unilaterally impose furloughs.

In a February letter to state House Speaker Calvin Say, D-20th (St. Louis Heights, Palolo Valley, Wilhelmina Rise), the state attorney general's office said it was unclear whether the governor has the power to order furloughs. The governor would likely have the implied authority to furlough if it was viewed akin to a layoff, the attorney general's office found, but the governor would have to consult with unions on furlough procedures. The attorney general's office warned that "these issues are likely to be subject to litigation."

In a second letter to Say on Friday, however, the attorney general's office argued that furloughs are not subject to mandatory negotiation. The attorney general's office determined that furloughs are not akin to layoffs and that negotiating furlough procedures with unions is permissible but not required.

"I don't think she can just unilaterally implement a furlough," Hanabusa said, adding that Lingle could face a court challenge.

The Lingle administration and union leaders are discussing furloughs, wage cuts and changes to healthcare benefits in labor talks, which are going poorly. Labor contracts expire at the end of the month, and if no settlement is reached in time, furloughs would be imposed when state workers are out of contract and potentially looking at strikes or binding arbitration.

Say said there are no plans for lawmakers to return in special session to address the budget deficit. Lingle has the discretion to implement the two-year budget passed by the Legislature, the speaker said, and lawmakers can make adjustments to the budget when they return for a new session in January.

Say said he doubts the economy will improve by then and believes lawmakers will have to come up with new revenue-generating ideas. The Council on Revenues is scheduled to update its forecast twice — in September and January — before lawmakers return. The speaker said lawmakers may have to go into the state's hurricane relief fund and the state's rainy-day fund and take other steps to contain the deficit.

"For me, by the time we start the session again, I'm looking at a $3.1 (billion), $3.2 billion shortfall," he said.

Randy Perreira, the executive director of the Hawai'i Government Employees Association, said Lingle's furlough plans would hurt many of the union's 29,000 members. He predicted some state workers would be unable to keep up with their home mortgage payments or would have to pull their children out of college.

Perreira said the governor "wants to cut her way to prosperity on the backs of the public workers. It's going to be horrible."

Roger Takabayashi, the president of the Hawai'i State Teachers Association, said the governor wants to close the deficit "off the backs of public workers and kids, particularly the kids, and that will be very difficult."

Lily Santos, a state worker who lives in Waipahu, expressed qualms about how state workers would absorb the pay cut from furloughs, given the state's high cost of living. "It's hard and so selfish of them," she said.

Lingle, anticipating claims she was balancing the budget at the expense of state workers, said labor costs account for about 70 percent of state expenses. She said state workers enjoyed pay increases of 16 to 29 percent over the past few years when the economy was thriving.

The governor said the alternative to furloughs would be layoffs of up to 10,000 state workers.

"While I recognize the serious financial impact that furloughs will have on our state employees and their families, this is a decision that I must make given the current fiscal challenges facing our state and the fact that we have already cut the budget where we could in other places," Lingle said. "This is the most difficult decision I have had to make since becoming governor."

Lingle does not have the power to order furloughs for workers at the state Department of Education, the University of Hawai'i and the Hawai'i Health Systems Corp., which are governed by independent boards. She said she would restrict spending for these departments by an equivalent amount as her furlough plans and hoped the departments would adopt furloughs.

The governor also asked the Legislature, the Judiciary and the state Office of Hawaiian Affairs to impose furloughs or restrict spending.

Lingle said that while furloughs would likely have an impact on state services, furloughs should not be used an an excuse for poor performance.

State schools Superintendent Pat Hamamoto estimated that the equivalent to furloughs amounts to about $162 million a year over the next two years. When added with restrictions during the past legislative session, she said, the Department of Education is facing a total of $384 million in cuts over the next two years.

Hamamoto said she was unable to say exactly how public schools would deal with those reductions. She said the department is likely to seek a combination of cost-saving measures including furloughs, increased class sizes and cuts to school-level programs.

Lingle described the budget deficit as a fiscal emergency unprecedented in size and scope. With $2.7 billion less to spend because of the declining revenue projections, she said, the state needs to create a government it can afford.

The governor repeated her opposition to new tax increases or legalized gambling as revenue-generating options, arguing that further tax hikes would delay the economic recovery and describing talk of legalizing gambling as a distraction. She warned that the state could face enormous deficits like California if it failed to cut labor costs. She also said it would be "irresponsible not to seek savings from the single largest expense in our state's operating budget — labor."

Lingle said the $42 million in cuts to state healthcare benefits for about 112,000 low-income adults is about 4.3 percent of the amount the state spends on health insurance for the poor. The state is unable to totally remove some adults from the healthcare program without jeopardizing federal money from Medicaid, the federal health insurance program for the poor and disabled.

"We must live within our means, and that requires that we provide what the government can afford while maintaining service levels as best we can," she said.

The Advertiser talked to several state workers after Gov. Linda Lingle announced her intention yesterday to furlough them for three days per month, resulting in a 13.8 percent pay cut. The workers interviewed asked that their names not be printed. Here's a sampling of the comments:

"This might convince me to get another job."

"I don't think the governor should do that because people are already on tight budgets. People shouldn't be put in that situation."

"In the long run it makes sense, but with the cost of living we just can't make (ends meet. Furloughs) are painful, but necessary."

"Obviously we don't like it, but what can we do? They don't even think about the workers."

"This amounts to about a 15 percent reduction in pay for the state employees. I wager we will not see a 15 percent reduction in the amount of service we receive. Everyone will step up and do a little extra."

"At least with furloughs, state workers will get another three days off a month. Not ideal, but could be worse."

"When the 2009 Legislature was in session, they made budget cuts everywhere except the state employee payrolls and benefits. These were the 'sacred cows.' ... It is unfortunate for these employees, but everyone everywhere is having to make sacrifices. They are fortunate to still have their jobs in this economy."

"We could have raised the GET (general excise tax) to spread the pain, which in all reality would have been pretty small when spread like that. Instead we're targeting one group of workers."

workers
State workers will take three days of furloughs each month for the next two years. These 72 days will save the state $688 million and are the equivalent of about a 13.8 percent pay cut.

MEDICAID
$42 million to be cut from program that provides health insurance for low-income adults, affecting about 112,000 people.

EDUCATION
Cut an additional $162 million per year over the next two years from state schools budget.

Public worker unions contend that Gov. Linda Lingle cannot furlough state workers without union agreement, indicating they are willing to try to block the governor's plan.

Lingle announced yesterday that starting in July, 14,500 state workers will have to take three days off a month without pay for the next two years. That translates into a 13.8 percent pay cut.

Lingle, in a televised address, said she needs to take the drastic action to balance the budget and make up an expected $730 million shortfall between now and July 2011.

The state is also trimming Medicaid expenses by 4.2 percent, or $42 million, and delaying for a month $130 million in payments to the state health and retirement funds.

In all, the state will have lost almost $3 billion in expected money from 2008 to 2011 because tax collections have come in far below predictions.

The latest blow to the state's budget came last week when the Council on Revenues lowered the revenue projections to 9 percent less than what was collected last year.

To balance the budget, Lingle called for $688 million in furloughs or pay cuts.

To state workers the cuts will be a serious blow.

Randy Perreira, Hawaii Government Employees Association executive director, said state workers are already looking at a 26 percent increase in health insurance costs and now will see their pay cut 13.8 percent.

"People are calling and asking how are they going to make it. These additional cuts will be a back-breaker for too many families. It would be economic ruin for too many," Perreira said.

Though Lingle cannot force furloughs on the 21,000 Department of Education workers, 7,400 university system employees and 3,500 health system workers, she is cutting the budgets of those departments and also urging furlough for them.

"We do not expect public schools to emerge from this economic crisis unscathed," said Roger Takabayashi, HSTA president. "We believe the governor's proposed solutions will inflict unnecessary damage to Hawaii's schools and, more importantly, to the children they serve." The cuts "will also prolong the state's frail economic condition," he said.

Democratic leaders in the Legislature said they doubt Lingle has the legal power to impose furloughs without getting union agreement.

"She is opening the state up to injunctive actions by the unions," said Senate President Colleen Hanabusa. And House Speaker Calvin Say called the plan "vulnerable."

But in a news conference after her 30-minute speech, Lingle insisted she has "implicit power" to control employees' working conditions.

"I would hope the unions would work with us," she said.

Lingle quoted from the state's collective bargaining law, noting, "The employer has the right and obligation to determine the method, means and personnel (by which) the employer's operations are to be conducted."

The issue is further complicated because Lingle has been attempting to negotiate new contracts with the four public employee unions but has been unable to give them a formal proposal because she cannot get the needed agreement from the county mayors and the Board of Education to make a formal offer. So she has been limited to informally discussing wage proposals with the unions, without much success.

Lawmakers looked at Lingle's call for furloughs to start in three weeks as another round of union negotiations. Lingle, however, cited a "fiscal emergency."

The governor's proposal to furlough state workers will be presented the Office of Hawaiian Affairs board, said its administrator, Clyde Namuo.

However, Namuo said OHA "isn't in the same situation as the state."

Although the Legislature reduced funding to OHA by 20 percent and its investments have fallen off, OHA was able to balance its $38 million budget by reducing expenses and not filling 15 vacant positions, Namuo added.

To head off staff cuts, Namuo will ask its staff of 150 to work an extra day without pay whenever OHA has special projects to complete.

Namuo noted that unlike the state where staff expenses take up nearly 70 percent of its budget, staff costs for OHA amount to only 30 percent.

A quick look at Gov. Linda Lingle's plans to handle a $730 million budget shortfall largely by furloughing 14,500 state workers:

» What: Workers will be furloughed three days a month. This means their pay will be 13.8 percent less, starting July. Lingle cannot furlough schoolteachers, university professors and state hospital workers, so she is cutting the budget of those departments by the same amount and urging that they also be furloughed.

» Why: The Council on Revenues lowered its tax collection prediction, meaning the state would be short $730 million by July 2011. Lingle rejected any more tax increases and said no yesterday to calls to legalize gambling, so the only thing left to cut is state salaries.

» Who is getting cut: State employees, from the governor on down, aside from the exceptions mentioned above. Lingle said it does not matter if the employee is paid with federal money, special funds or general funds.

» Can the state do this? Lingle says she can act without union agreement, but the unions disagree. So do Democrats in the Legislature. The Hawaii Government Employees Association says it is willing to go to court to try to stop the furloughs.

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