The following testimony was submitted by the Grassroot Institute of Hawaii for consideration by the House Committee on Finance on March 31, 2025.
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March 31, 2025, 10 a.m.
Hawaii State Capitol
Conference Room 308 and Videoconference
To: House Committee on Finance
Rep. Kyle T. Yamashita, Chair
Rep. Jenna Takenouchi, Vice Chair
From: Grassroot Institute of Hawaii
Ted Kefalas, Director of Strategic Campaigns
TESTIMONY IN SUPPORT OF HCR61 — REQUESTING A STUDY EXAMINING HOW CERTAIN OTHER JURISDICTIONS PRODUCE FISCAL NOTES
Aloha Chair Yamashita, Vice Chair Takenouchi and other members of the Committee,
The Grassroot Institute of Hawaii would like to offer support for HCR61, which requests that the Legislative Reference Bureau analyze the process for producing fiscal notes and report on its findings — along with any proposed legislation — prior to the 2026 legislative session.
If implemented, fiscal notes would be an extremely helpful tool for both lawmakers and Hawaii residents.
It is a matter of great frustration to lawmakers and residents alike that the Legislature often considers bills without any reliable estimate of what the proposed legislation will cost or save the government and taxpayers.
What would be irresponsible for a family budget — making purchases without any notion of their cost — is standard practice in politics.
The solution is to be found in the adoption of “fiscal notes,” an informed estimate of how much revenue a bill might generate or cost.
In 2022, the Council of State Governments evaluated the use of fiscal notes by states in six categories: intent or purpose of the bill, cost involved, projected future cost, proposed source of revenue, fiscal impact on local government and “other.” Hawaii, notably, failed to perform in any category and was the only state in the country without a process or independent office for generating fiscal notes.
In Hawaii, state agencies — especially the Department of Taxation — sometimes submit testimonies with projections of potential fiscal impact, but these are not reliable substitutes for fiscal notes. Agencies have their own biases and interests, and relying solely on agency estimates would undermine the Legislature’s independence.
Including fiscal notes in the legislative process would be an important step towards promoting greater fiscal responsibility and sound budgeting. Moreover, it would help lawmakers and the public in properly evaluating the true impact of pending legislation.
We urge the committee to pass HCR61.
Thank you for the opportunity to testify.
Ted Kefalas
Director of Strategic Campaigns
Grassroot Institute of Hawaii
