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Governor’s Message - December 2013

Posted in December 2013

Governor’s Message - December

Gov.AbercrombieThe Holiday Season provides an excellent opportunity to take stock and recognize the many things for which we are thankful. I am happy to report that includes our improved economic outlook and fiscal condition.

The State of Hawaii’s recent success in completing the sale of $860 million of tax-exempt and taxable General Obligation Bonds is the latest affirmation of how far we have come since the Great Recession. It was a significant reflection of local and national confidence in the state’s strong financial performance.

Completed in November, the bond proceeds will be used for various capital improvement projects (CIPs) as well as refinancing existing debt. Hawaii taxpayers will save more than $18 million due to the refinancing of more than $181 million of outstanding bonds.

Capital financing is a major part of financing public projects, and it is critical that investors, residents and institutions alike have confidence in the direction of our state. During the two-day retail order period, the state gathered more than $159 million of orders from retail investors and their advisors – of which $36 million was from Hawaii.

As previously mentioned, I recently joined the state finance team in meeting with credit agencies on the U.S. Mainland about our state’s fiscal status and economy. Moody’s Investor Services, Standard and Poor’s and Fitch Ratings affirmed our state’s existing General Obligation Bond ratings at “Aa2” “AA” and “AA,” respectively. Standard and Poor’s assigned Hawaii a “Positive” outlook, citing the state’s strong economy, conservative financial management, recent pension reform measures, and landmark other post-employment benefit funding legislation. Both Moody’s and Fitch assigned “Stable” outlooks to the bonds.

Over the past three years, this Administration has taken aggressive measures in stabilizing the state’s fiscal situation. I have no doubt Kona-Kohala Chamber members recall that our state faced a $220 million shortfall in 2011, leaving it with crippled programs, furloughs, and legislatively imposed revenue enhancement measures.

The difficult decisions we made are now paying off. As 2013 comes to a close, you can be assured our state is on the right path to having as much as a billion dollar positive turnaround in our year-end balance sheet and having a game plan for fully financing our presently unfunded liabilities. We will not turn back; we will not repeat the mistakes of the past; we will meet our fiscal responsibilities.

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  • Posted in: December 2013