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Wow, crazy numbers. I'm assuming Hawaii will get hit harder than other states due to our dependence on tourism. I've been a proponent of shrinking state government payroll here for a long time but I know the unions are powerful. On the news today the union boss was talking about finding alternatives. However, with pretty much zero income from tourism, it's going to be hard to find anything else to make up this shortfall. I'm sure some state workers are upset and scared to say the least. This is going to be a time when all that security of a state job comes at a steep price. I'm also concerned about quality of workers being compromised, especially positions like teachers. 20% for 2 years is a huge pay cut.
This state has hundreds of full-time teachers who aren't fully credentialed yet. They are earning about $30k per year and paying for classes to become certified. A 20% cut is going to make it even more difficult for them to continue in this profession. Many of them are also waiters, luau dancers, carpenters, etc.. This could be the breaking point for many.
I expect that soon the state will be forced to lower the requirements to teach...perhaps a high school diploma will suffice to teach high school.
If tourism doesn't come back quickly, there should be plenty of applicants IF the schools re-open in the Fall.
Needs to be done with state deriving most revenue from GET and TAT. Also state income tax collections will be way down. This thing is worse than the financial crisis, one would think the cuts be more severe than equal to those cuts.
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This state has hundreds of full-time teachers who aren't fully credentialed yet. They are earning about $30k per year and paying for classes to become certified. A 20% cut is going to make it even more difficult for them to continue in this profession. Many of them are also waiters, luau dancers, carpenters, etc.. This could be the breaking point for many.
I expect that soon the state will be forced to lower the requirements to teach...perhaps a high school diploma will suffice to teach high school.
If tourism doesn't come back quickly, there should be plenty of applicants IF the schools re-open in the Fall.
Shared sacrifices... Consider the private sector unemployed who lost 100% of their income and have not gotten any unemployment yet. The state has only processed a fraction of the claims.
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This state has hundreds of full-time teachers who aren't fully credentialed yet. They are earning about $30k per year and paying for classes to become certified. A 20% cut is going to make it even more difficult for them to continue in this profession. Many of them are also waiters, luau dancers, carpenters, etc.. This could be the breaking point for many.
I expect that soon the state will be forced to lower the requirements to teach...perhaps a high school diploma will suffice to teach high school.
If tourism doesn't come back quickly, there should be plenty of applicants IF the schools re-open in the Fall.
The bar is low for teaching. Any 4 year degree plus passing a test. Like you said, the unemployment rate is high so any openings should get filled. Id imagine the only people quitting is the most senior administrators and teachers retiring.
In the sense that Hawaii floats large amounts of bonds, they do not run a real balanced budget.
They do - the bond debt service is part of the fixed general fund budget - this year, it is $862 Million - the $8 Billion budget does balance. The fixed general fund budget runs about $4 Billion per year, debt service almost 25% of the fixed budget
The bigger problem again is the Constitution which 1) requires a balanced budget and 2) has limitations on how bonds can be issued - and lastly 3) even if we could issue more bonds - who would want to buy Hawaii bonds given it will likely be years before a recovery.
Folks - the situation is much more dire than the proposed 20% cut.
For those interested -
We get about 50% of our revenue from GET - so, almost nothing is coming in
Next is income taxes, personal and corporate - we have a minimum of 33% unemployment but we know it is far more - we know many businesses are shut down, for instance, we know Hawaiian Airlines isn't going to be paying corporate taxes anytime soon.
Next is hotel taxes - we know that is practically zero
Finally, there is some revenue from permits, etc - which are pretty much not being issued but is only a small part of the revenue stream
from that sense, yes of course it does budget, but from the standpoint that you borrowed money for whatever project and are now making payments on that borrowing, it's not really balanced year to year. It would be like balancing your monthly expenses with $500 payments on $10,000 in credit card debt. Technically cashflow wise, you're running a balanced budget, but be leveraged to the hilt with a boatload of debt looming in the background. Saying you balanced the budget in that case doesn't mean much. Hell they could float more bonds to pay the salaries, make minimal payments on the debt and trumpet it as a balanced budget. A true balanced budget would be one where your cash inflows are meeting your cash outflows without the need to borrow billions of dollars. Capital expenditures would be financed through savings and not large amounts of debt. Buying a car with cash versus loans.
Also note that income taxes were deferred, not sure if that would cause shorter term cash issues.
The only positive to all this is ige's not up for re-election otherwise he'd probably be acting more timidly than he normally already acts. There were already rumblings of pay cuts/furloughs coming out of B&F from a month ago.... the sooner they enact any sort of cuts, the less severe it will likely be in the longer run. They should look at cutting salaries from the top down.
The bar is low for teaching. Any 4 year degree plus passing a test. Like you said, the unemployment rate is high so any openings should get filled. Id imagine the only people quitting is the most senior administrators and teachers retiring.
That’s why I’m beginning to think my wife won’t even be looked at for any open position now. She will cost too much money. Two masters and six years teaching experience puts her at too high a tier.
That’s why I’m beginning to think my wife won’t even be looked at for any open position now. She will cost too much money. Two masters and six years teaching experience puts her at too high a tier.
They likely won't look at your wife not due to costs - but more likely due to more local applicants with unemployment running 33%+ right now. DOE will grab a local applicant regardless of experience versus an out of state applicant.
I disagree with the teachers union PR statements - if DOE is hiring, they will be flooded with applicants regardless of the 20% pay cut.
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