Our state is on track toward economic recovery and sustainability.
On July 20, I was pleased to report that the State of Hawai'i concluded its 2012 fiscal year (FY) with a positive ending balance of $306 million and a bump in tax revenue, up 14.9 percent over the 2011 FY. This is the second consecutive year that our state has ended the fiscal year in the black.
When I took office in December 2010, we faced a $200 million revenue shortfall. But we stuck to our plan. Getting to this point did not come easy. It took shared sacrifice by state workers and labor unions and tough decisions by our financial team.
Government That Works
Governor Neil Abercrombie
As state Budget and Finance Director Kalbert Young put it: "This positive balance is evidence that we are governing in a sound manner in the face of severe fiscal requirements in the upcoming biennium budget."
However, he wisely cautioned that we are not immune to fiscal threats faced by other states, such as Medicaid spending growth, federal deficit reduction, underfunded pension funds, and unfunded liabilities for healthcare benefits. Continuation of our current strategy is the prudent course of action.
Nonetheless, we are clearly in a better position to restore basic services that had been cut years ago, such as those provided by inspectors in the state Departments of Health, Agriculture, and Land and Natural Resources. We are also better able to continue working to restore the state's watersheds, invest in early childhood education and update the state's technology system.
A key component of our economic strategy is job creation. Since the start of 2012, I have released more than $423.8 million for capital improvement projects (CIPs), selected for their potential to immediately stimulate the economy and generate job opportunities for residents.
Among recently released CIP funds announced on July 20 were more than $18.3 million for maintenance and upgrades to transportation infrastructure on Maui. State highways, airports and harbors are essential to island commerce and our way of life. We all depend on their daily reliability and functionality to continue the flow of ground, air and ship transportation to, from and throughout the state.
An example of these CIPs includes $5,500,000 for design and construction of emergency erosion repairs along Honoapi'ilani Highway. On Ka'ahumanu Avenue, $907,000 will fund design and construction to extend the right turn lane adjacent to the main entrance of the area school. And at Kahului Airport, $6 million will be used for a proposed consolidated rental car facility--a two-level structure that will include a customer service building, quick-turnaround, and ready/return vehicle spaces.
We are making great strides toward our New Day vision. I'm proud of our team and appreciate the work of everyone who has supported us in our efforts. At the start of this year, my administration submitted a balanced supplemental budget that seeks to maintain a healthy surplus, incorporates savings achieved through solid fiscal management, funds high-priority programs and does not rely on tax increases.
Now is the time to redouble our efforts and work together to continue our now proven sound fiscal strategy and the way forward to shared prosperity.