HB 1424: BUF; Budget; Appropriations; Reports

A BILL FOR AN ACT

RELATING TO APPROPRIATIONS.

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

     SECTION 1.  The legislature finds that for fiscal year 2025, the executive branch had requested about $3,600,000,000 in funding for more than forty-seven thousand permanent and three thousand six hundred temporary authorized positions.  The amount requested accounted for more than twenty per cent of all authorized funds in fiscal year 2025.

     The legislature further finds that there has been a high vacancy rate in public employment positions and funds appropriated for these positions are either transferred or used for purposes that are not consistent with the purpose for which the appropriation was authorized.  A vacancy report from December 2024 from the department of human resources development identified four thousand eighty-five vacancies, or about twenty-four per cent of civil service positions, in the State.

     The purpose of this Act is to increase legislative oversight to ensure that funds appropriated by the legislature are used for their intended purpose by requiring an annual report to the legislature on the transfer of funds originally appropriated for positions but used for operating expenses, and vice versa.

     SECTION 2.  Chapter 37, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§37-     Transfers of funds; positions; operating expenses; report.  The director of finance shall submit an annual report to the legislature no later than sixty days after the end of the fiscal year that shall, at minimum:

     (1)  Identify all positions funded by appropriations intended for operating expenses including but not limited to equipment and motor vehicles;

     (2)  Identify operating expenses funded by appropriations intended for filling positions during the preceding fiscal year; and

     (3)  Include, if applicable, a list of departments that failed to provide information necessary to complete the report."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect upon its approval.

Report Title:

BUF; Budget; Appropriations; Reports

Description:

Requires the Director of Finance to report to the Legislature on the transfer of funds originally appropriated for positions but used for operating expenses, and vice versa.  (CD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO APPROPRIATIONS.

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

     SECTION 1.  The legislature finds that for fiscal year 2025, the executive branch had requested about $3,600,000,000 in funding for more than forty-seven thousand permanent and three thousand six hundred temporary authorized positions.  The amount requested accounted for more than twenty per cent of all authorized funds in fiscal year 2025.

     The legislature further finds that there has been a high vacancy rate in public employment positions and funds appropriated for these positions are either transferred or used for purposes that are not consistent with the purpose for which the appropriation was authorized.  A vacancy report from December 2024 from the department of human resources development identified four thousand eighty-five vacancies, or about twenty-four per cent of civil service positions, in the State.

     The purpose of this Act is to increase legislative oversight to ensure that funds appropriated by the legislature are used for their intended purpose by requiring a report to the legislature upon the approval of the transfer of funds appropriated for positions to operating expenses, and vice versa.

     SECTION 2.  Chapter 37, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§37-    Transfers of funds; positions; operating expenses; report.  The director of finance shall submit a report to the legislature upon approving the transfer of funds for:

     (1)  Positions to operating expenses; or

     (2)  Operating expenses to fund positions

     for any state department or agency."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 3000.

Report Title:

BUF; Budget; Appropriations; Reports

Description:

Requires the Director of Finance to report to the Legislature after approving the transfer of funds appropriated for positions to operating expenses, and vice versa.  Effective 7/1/3000.  (SD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO APPROPRIATIONS.

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

     SECTION 1.  The legislature finds that for fiscal year 2025, the executive branch had requested about $3,600,000,000 in funding for more than forty-seven thousand permanent and three thousand six hundred temporary authorized positions.  The amount requested accounted for more than twenty per cent of all authorized funds in fiscal year 2025.

     The legislature further finds that there has been a high vacancy rate in public employment positions and funds are either transferred or used for purposes that are not consistent with the purpose for which the appropriation was authorized.  A vacancy report from December 2024 from the department of human resources development identified four thousand eighty-five vacancies, or about twenty-four per cent of civil service positions, in the State.

     The purpose of this Act is to ensure that funds appropriated by the legislature are used for their intended purpose by prohibiting the transfer of funds appropriated for positions to operating expenses, and vice versa, except to fulfill the legislature's purpose for which the funds were appropriated.

     SECTION 2.  Chapter 37, Hawaii Revised Statutes, is amended by adding a new section to part II to be appropriately designated and to read as follows:

     "§37-     Appropriated funds; transfers prohibited.  No department or agency shall transfer funds, or authorize the transfer of funds, appropriated for:

     (1)  Positions to operating expenses; or

     (2)  Operating expenses to fund positions,

except to fulfill the legislature's purpose for which the funds were appropriated."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 3000.

Report Title:

Budget; Allotment System; Appropriations

Description:

Prohibits the transfer of funds appropriated for positions to operating expenses, and vice versa, except to fulfill the Legislature's purpose for which the funds were appropriated.  Effective 7/1/3000.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

relating to appropriations.

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

     SECTION 1.  The legislature finds that for fiscal year 2025, the executive branch had requested about $3,600,000,000 in funding for more than forty-seven thousand permanent and three thousand six hundred temporary authorized positions.  The amount requested accounted for more than twenty per cent of all authorized funds in fiscal year 2025.

     The legislature further finds that there has been a high vacancy rate in public employment positions and funds are either transferred or used for purposes that are not consistent with the purpose for which the appropriation was authorized.  A vacancy report from December 2024 from the department of human resources development identified four thousand eighty-five vacancies, or about twenty-four per cent of civil service positions, in the State.

     The purpose of this Act is to ensure that funds appropriated by the legislature are used for their intended purpose by prohibiting the transfer of funds appropriated for positions to operating expenses, and vice versa, except to fulfill the legislature's purpose for which the funds were appropriated.

     SECTION 2.  Chapter 37, Hawaii Revised Statutes, is amended by adding a new section to part II to be appropriately designated and to read as follows:

     "§37-     Appropriated funds; transfers prohibited.  No department or agency shall transfer funds, or authorize the transfer of funds, appropriated for:

     (1)  Positions to operating expenses; or

     (2)  Operating expenses to fund positions,

except to fulfill the legislature's purpose for which the funds were appropriated."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect upon its approval.

Report Title:

Budget; Allotment System; Appropriations

Description:

Prohibits the transfer of funds appropriated for positions to operating expenses, and vice versa, except to fulfill the Legislature's purpose for which the funds were appropriated.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

CONFERENCE COMMITTEE REP. NO. 164

Honolulu, Hawaii

                 , 2025

RE:    H.B. No. 1424

       H.D. 1

       S.D. 1

       C.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madam and Sir:

     Your Committee on Conference on the disagreeing vote of the House of Representatives to the amendments proposed by the Senate in H.B. No. 1424, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO APPROPRIATIONS,"

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

     The purpose of this measure is to require the Director of Finance to report to the Legislature after approving the transfer of funds that were originally appropriated to fund positions but are instead used to pay for operating expenses, and vice versa, for any state department or agency.

     Your Committee on Conference has amended this measure by:

     (1)  Clarifying the items to be included in the report to the Legislature;

     (2)  Removing the requirement for the Legislature to consider certain criteria in making future appropriations to departments;

     (3)  Changing the effective date to upon approval; and

     (4)  Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.

     As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of H.B. No. 1424, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Final Reading in the form attached hereto as H.B. No. 1424, H.D. 1, S.D. 1, C.D. 1.

Respectfully submitted on behalf of the managers:

STAND. COM. REP. NO. 1775

Honolulu, Hawaii

RE:    H.B. No. 1424

       H.D. 1

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred H.B. No. 1424, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO APPROPRIATIONS,"

begs leave to report as follows:

     The purpose and intent of this measure is to increase legislative oversight over appropriated funds.

     More specifically, this measure requires the Director of Finance to report to the Legislature after approving the transfer of funds that were originally appropriated to fund positions but are instead used to pay for operating expenses, and vice versa, for any state department or agency.

     Your Committee received written comments on this measure from the Grassroot Institute of Hawaii.

     Your Committee finds that, for fiscal year 2025, the Executive Branch had requested approximately $3,600,000,000 to fund more than forty-seven thousand permanent and three thousand six hundred temporary authorized positions.  Your Committee further finds that there has been a high vacancy rate in public employment positions and that funds appropriated for these positions are often either transferred or used for purposes that are not consistent with the purpose for which the appropriation was authorized.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1424, H.D. 1, S.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

STAND. COM. REP. NO. 1272

Honolulu, Hawaii

RE:    H.B. No. 1424

       H.D. 1

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Government Operations, to which was referred H.B. No. 1424, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO APPROPRIATIONS,"

begs leave to report as follows:

     The purpose and intent of this measure is to prohibit the transfer of funds appropriated for positions to operating expenses, and vice versa, except to fulfill the Legislature's purpose for which the funds were appropriated.

     Your Committee received testimony in support of this measure from the Grassroot Institute of Hawaii.

     Your Committee received testimony in opposition to this measure from the Department of Corrections and Rehabilitation, Department of the Attorney General, Department of Budget and Finance, and Department of Commerce and Consumer Affairs.

     Your Committee received comments on this measure from the Department of Labor and Industrial Relations, Department of Land and Natural Resources, Department of Accounting and General Services, and Department of Hawaiian Home Lands.

     Your Committee finds that responsible budgeting is critical to accountability and efficiency in state government.  The misuse of funds appropriated for vacant positions is therefore an increasingly paramount budgetary concern.  With thousands of unfilled civil service positions, precautions must be taken to ensure appropriations are expended in accordance with the Legislature's intent, rather than that of the expending department.  This measure promotes transparency and accountability in state spending by prohibiting state departments or agencies from transferring funds appropriated for positions to operating expenses, and vice versa.

     While your Committee is in accordance with the intent of this measure, it also acknowledges the concerns raised in testimony that uncertainty and volatility at the national level may impact federal funding, making flexibility in expending state appropriations increasingly important to each department's ability to serve the public.  Therefore, this measure needs to be amended to address this matter.

     Accordingly, your Committee has amended this measure by:

     (1)  Deleting language that would have prohibited the transfer of funds for positions to operating expenses, and vice versa, except to fulfill the Legislature's purpose in appropriating the funds;

     (2)  Inserting language that requires the Director of Finance to report to the Legislature upon approving the transfer of funds for positions to operating expenses, and vice versa, for any state department or agency;

     (3)  Amending section 1 to reflect its amended purpose; and

     (4)  Making a technical, nonsubstantive amendment for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1424, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1424, H.D. 1, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Government Operations,

STAND. COM. REP. NO.  914

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 1424

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Finance, to which was referred H.B. No. 1424, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO APPROPRIATIONS,"

begs leave to report as follows:

     The purpose of this measure is to prohibit the transfer of funds appropriated for the purposes of filling vacancies to operating expenses.

     Your Committee received testimony in support of this measure from the Grassroot Institute of Hawaii.  Your Committee received testimony in opposition to this measure from the Department of Budget and Finance; Department of Defense; Department of Corrections and Rehabilitation; and Department of Commerce and Consumer Affairs.  Your Committee received comments on this measure from the Department of Accounting and General Services; Department of Human Services; Department of Agriculture; Department of Hawaiian Home Lands; and Department of Labor and Industrial Relations.

     As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1424, H.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Finance,

STAND. COM. REP. NO.  658

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 1424

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Labor, to which was referred H.B. No. 1424 entitled:

"A BILL FOR AN ACT RELATING TO APPROPRIATIONS,"

begs leave to report as follows:

     The purpose of this measure is to prohibit the transfer of funds appropriated for the purposes of filling vacancies to operating expenses.

     Your Committee received testimony in support of this measure from the Grassroot Institute of Hawaii.  Your Committee received comments on this measure from the Department of Human Services and Department of Accounting and General Services.

     Your Committee finds that the Legislature appropriates millions of dollars for the purposes of filling vacant positions throughout the State.  Your Committee also finds that funds allotted to departments and agencies are sometimes transferred within the department or agency to cover operating expenses instead of filling vacant positions.  Your Committee believes that this measure ensures funds appropriated by the Legislature to fill vacant positions are used for their intended purpose by prohibiting the transfer of these funds for operating expenses and vice versa.

     Your Committee has amended this measure by changing the effective date to July 1, 3000, to encourage further discussion.

     As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1424, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1424, H.D. 1, and be referred to your Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Labor,