HONOLULU (AP) - Consumers are spending more money thanks to lower gasoline and heating fuel prices, and that may boost Hawaii’s economy, economists said.
The state Council on Revenues is predicting higher revenue growth for the state than it was expecting, the Honolulu Star-Advertiser reported (https://bit.ly/1yCtsPX ).
The council revised its projections for the current fiscal year Tuesday, saying revenue will grow by 4.5 percent, up from the 3.5 percent growth predicted in September.
“The U.S. economy is very strong, and a lot of our tourists are from the mainland U.S.,” Kurt Kawafuchi, Council on Revenues chairman, said after the meeting. “With the lower price of gas, people are going to have more money to spend because they’re paying less for gas and electricity.”
That means the state is expecting to bring in roughly $55 million more in tax revenues in the current fiscal year, which ends June 30. The council’s forecast is used to determine the state budget.
Key lawmakers were pleased with the improved forecast but reluctant to start doling out money for a slew of new programs and initiatives.
State Rep. Sylvia Luke, House Finance Committee chairwoman, and state Sen. Jill Tokuda, Senate Ways and Means Committee chairwoman, both noted the state has mounting obligations and is on a path to spend more than it takes in for another fiscal year. The deficit spending has eaten away at some of the state’s cash reserves.
“We will be looking at the budget in a very conservative way,” Luke said. “We don’t want to do anything that’s going to throw economic growth out of whack by spending beyond whatever we’re supposed to.”
Every department is going to come forward with a variety of requests, including those that feel they’re in emergency situation, Tokuda said.
“This budget’s just not going to be able to handle that, even with this increase to 4.5 percent,” Tokuda said.
Information from: Honolulu Star-Advertiser, https://www.staradvertiser.com
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