Highlights from House Bill 1800: the state supplemental budget bill

At Hawaiʻi Appleseed, we believe that a budget is more than a spreadsheet: it is a statement of our collective values. Every dollar allocated—or withheld—speaks volumes about who we prioritize as a state.

Do we invest in public healthcare for those in need, especially with federal cuts to Medicaid on the horizon? Or do we cut funding for houselessness solutions while continuing to fund tourism marketing? These are not abstract accounting questions. They represent real choices about the foundations we are laying for future generations.

That is why we are paying close attention to House Bill 1800, the state’s budget bill for FY2026 and FY2027. This is the single most consequential bill of the legislative session. It determines how the State of Hawaiʻi will fund everything from public education and roads to healthcare and affordable housing. As the Governor’s initial proposal moves through the House and Senate to a final conference committee version, those numbers change—sometimes dramatically.

Our team has analyzed the latest drafts of the budget and built a tracker that you can use to compare versions. Here is what we found.

The Senate’s Changes: Additions and Cuts

Although the overall budget slightly increased between the Governor’s supplemental request and the first Senate draft, there are many cuts and additions that are worth mentioning. We have decided to focus on FY 2027, which saw the most substantial changes.

The Senate version of the bill reduced the operating budget—which pays for ongoing costs like government salaries—by about $300 million in FY 2027. The Senate itself has stated that these cuts target vacant positions and lapsed funds. On the other hand, the Senate boosted the capital budget—for buildings and infrastructure—by $308 million in FY 2027.

Significant additions include:

• $108 million in operating funds for the Public Lands Management program

• $250 million for capital improvement projects in the Department of Education, such as the designing and construction of school facilities. Of note: $146 million designated for the King Kamehameha III elementary school on Maui, which was destroyed in the 2023 wildfires

Notable reductions or removals include:

• $211 million covering insurance claims related to the 2023 Maui wildfire disaster

• $58 million spread across the Department of Human Services, including a $8 million cut to the operating budget for the Office of Homelessness and Housing Solutions

A note on methodology: Some of these marked changes reflect funds being transferred between departments rather than outright cuts or additions. We have noted the net impact where possible.

What These Numbers Mean for Working Families

The Senate’s increased capital investment in the Department of Education is a win for our communities, particularly Lahaina. That funding will help to build and maintain schools for our keiki, providing them with the high-quality learning environment they deserve.

Although we cannot confirm just yet whether certain cuts are focused on redundancies, there are a number of concerning changes. For example, the $8 million cut for the Office on Homelessness and Housing Solutions—while our state faces a persistent housing crisis—may send the wrong message about our priorities.

The truth is that the funds available for our state budget are always dependent on the tax revenue we can generate. At the moment, Hawaiʻi’s tax system asks too little from those who hold the most wealth.

If we want a budget that truly serves Hawaiʻi’s residents—one that adequately funds healthcare, affordable housing, food access, public education, climate resilience, and transit equity— we need to raise taxes on those who can afford to pay more. The ultra-wealthy, including non-residents who own multi-million dollar investment properties, should be paying their fair share toward the programs and services that we all benefit from.

That is why we continue to champion SB3028 (which modernizes the conveyance tax) and SB3125 (which pauses income tax cuts for high earners). These bills would generate hundreds of millions of dollars in new revenue each year—revenue that could fill the gaps left by HB1800 and lift up Hawaiʻi’s families who are struggling to make ends meet.

The state budget ultimately reflects our values, and we need to make sure that this one embodies our compassion and shared responsibility for all of Hawaiʻi’s communities.