The Hawaii House of Representatives has introduced a significant legislative bill, HB1037, aimed at addressing salary increases and cost adjustments for state officers and employees excluded from collective bargaining. Introduced on February 10, 2025, the bill outlines funding provisions for the fiscal biennium 2025-2027, specifically targeting those within the same compensation plans as employees in bargaining unit (11).

The bill's primary purpose is to ensure that salary increases and adjustments authorized by Chapter 89C of the Hawaii Revised Statutes are adequately funded. However, notably, the bill indicates that no general, special, federal, or other funds are appropriated for these increases, raising questions about the financial feasibility of the proposed adjustments. The director of finance is tasked with allotting any necessary funds to the appropriate state departments for expenditure in the respective fiscal years.

Key provisions include stipulations that salary increases for employees whose compensation is partially funded by federal or special funds will be proportionately covered by those respective funds. Additionally, any funds appropriated that remain unspent by the end of the fiscal years will lapse, emphasizing the need for timely expenditure.

While the bill appears straightforward, it has sparked discussions regarding its implications for state budgeting and employee compensation. Critics may argue that the lack of appropriated funds could hinder the bill's effectiveness, while supporters emphasize the importance of addressing salary equity among state employees.

As the legislative process unfolds, the bill's future will depend on further debates and potential amendments. Stakeholders are closely monitoring the situation, as the outcomes could significantly impact state employee morale and retention, as well as the overall financial health of Hawaii's public sector. The bill is set to take effect on July 1, 3000, if passed, marking a long-term commitment to addressing compensation issues within the state workforce.