REPORT TITLE:
Rainy day fund


DESCRIPTION:
Establishes an emergency and budget stabilization fund.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                            59          
HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                     A BILL FOR AN ACT

RELATING TO AN EMERGENCY AND BUDGET STABILIZATION FUND.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Chapter 37, Hawaii Revised Statutes, is amended
 
 2 by adding a new part to be appropriately designated and to read
 
 3 as follows:
 
 4        "PART   .  EMERGENCY AND BUDGET STABILIZATION FUND
 
 5      37-   Establishment of the emergency and budget
 
 6 stabilization fund; transfers.  There is established an emergency
 
 7 and budget stabilization fund, which shall be attached to the
 
 8 department of budget and finance for administrative purposes,
 
 9 into which shall be transferred periodically the amounts
 
10 specified by this section.  Whenever the general fund balance at
 
11 the close of each of two successive fiscal years exceeds five per
 
12 cent of the total moneys received in the general fund for each of
 
13 the two fiscal years, including any beginning balance, the
 
14 legislature may transfer an amount of not more than fifty per
 
15 cent of the general fund balance to the emergency and budget
 
16 stabilization fund.
 
17      All interest earned from moneys in the emergency and budget
 
18 stabilization fund shall accumulate and become part of the fund.
 
19      37-    Appropriations required; purposes; prohibitions.
 
20 (a) No expenditures shall be made from the emergency and budget
 

 
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 1 stabilization fund except pursuant to appropriations.  The
 
 2 governor, through the executive budget, supplemental budget, or
 
 3 any appropriations bill may recommend appropriations from the
 
 4 emergency and budget stabilization fund by setting forth the
 
 5 purposes, consistent with the purposes listed in subsection (b),
 
 6 the amounts, and the reasons why such appropriations are
 
 7 necessary.
 
 8      (b)  The legislature may make appropriations from the fund
 
 9 for the following purposes:
 
10      (1)  To maintain levels of programs determined to be
 
11           essential to the public health, safety, and welfare;
 
12      (2)  To maintain current services for federally-assisted
 
13           state programs when federal funds for such programs are
 
14           reduced or are less than anticipated;
 
15      (3)  To meet debt service payments when interest costs are
 
16           higher than anticipated or to meet capital investment
 
17           costs when high interest rates prevent the State from
 
18           borrowing at reasonable rates in the long-term
 
19           borrowing market;
 
20      (4)  To provide for countercyclical economic and employment
 
21           programs in periods of economic downturn or slowdown;
 
22      (5)  To restore facilities destroyed or damaged, or services
 
23           disrupted by disaster in any county; and
 

 
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 1      (6)  To meet other emergencies when declared by the governor
 
 2           or determined to be urgent by the legislature.
 
 3      Any act making appropriations from the emergency and budget
 
 4 stabilization fund shall include a declaration of findings and
 
 5 purpose setting forth the purposes, the amounts, and the reasons
 
 6 why the appropriations are necessary.  Nothing in this section
 
 7 shall preclude the legislature from authorizing the transfer of
 
 8 any amount from the emergency and budget stabilization fund to
 
 9 the general fund at any time.
 
10      (c)  Appropriations from the fund for the following purposes
 
11 are specifically prohibited:
 
12      (1)  To meet expenses of the legislature;
 
13      (2)  To provide for salary adjustments for officials
 
14           appointed pursuant to Section 6 of Article V, or
 
15           Section 3 of Article VI, of the State Constitution and
 
16           for others whose salaries may be directly related to
 
17           the salaries of such officials; and
 
18      (3)  To fund cost items in any collective bargaining
 
19           contract unless the general fund or the applicable
 
20           special fund is or is projected to be in a deficit
 
21           position and cannot fund the cost items approved by the
 
22           legislature.
 

 
 
 
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 1      (d)  Total general fund expenditures by the State during any
 
 2 fiscal year, including expenditures from appropriations from the
 
 3 emergency and budget stabilization fund, shall not exceed the
 
 4 general fund expenditure ceiling established pursuant to part V
 
 5 except as otherwise provided.
 
 6      37-   Report.  At least twenty days prior to the convening
 
 7 of each regular session, the director of finance shall submit to
 
 8 the legislature a report of the condition of the emergency and
 
 9 budget stabilization fund, including:
 
10      (1)  For the previous fiscal year:
 
11           (A)  The beginning balance;
 
12           (B)  The amount transferred to the fund;
 
13           (C)  The appropriations made from the fund;
 
14           (D)  The expenditures and encumbrances for each
 
15                appropriation;
 
16           (E)  The amount, if any, lapsed for each appropriation;
 
17                and
 
18           (F)  The closing balance;
 
19      and
 
20      (2)  For the fiscal year in progress:
 
21           (A)  The beginning balance;
 
22           (B)  The amount transferred to the fund;
 
23           (C)  The appropriations made from the fund;
 

 
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 1           (D)  Expenditures for each appropriation for the first
 
 2                quarter;
 
 3           (E)  Estimated expenditures for the remaining three
 
 4                quarters; and
 
 5           (F)  The estimated closing balance."
 
 6      SECTION 2.  There is transferred out of the general revenues
 
 7 of the State of Hawaii the sum of $        or so much thereof as
 
 8 may be necessary for fiscal year 1999-2000 to be deposited into
 
 9 the emergency and budget stabilization fund for the purposes of
 
10 this Act.
 
11      SECTION 3.  This Act shall take effect on July 1, 1999.
 
12 
 
13                         INTRODUCED BY:___________________________