Gov. Abercrombie also proposed looking at Liquefied Natural Gas as an alternative energy source.

LNG would allow the state to purchase from U.S. sources instead of going overseas.  The governor said the resource is abundant and the technology exists for us to use it now.

The governor also pointed out the cutback in the solar tax credit.  He said, "The lack of clarity and confusion by some gaming the system, created an uneven playing field for the renewable energy companies."

The governor said he is asking the Department of Taxation to work with the Legislature to find the appropriate balance and amendments to the tax credit to make it fair for everyone and sustainable.

The governor is looking to increase the conveyance tax, limited to high-end property transactions valued at more than $2 million to fund watershed protection.  Gov. Abercrombie said it would generate $10 million.  Another proposal is to look at a 10 cent fee for single-use checkout bags that could generate $15 million.

The governor is also pushing innovation and entrepreneurship.  He is proposing the Hawaii Growth Initiative, a state investment program focused on building an innovation ecosystem that supports entrepreneurial high growth businesses and creates high wage jobs.  This will also include agricultural and farming ventures.

Gov. Abercrombie will be asking the Legislature to increase the Kupuna Care budget by $4.2 million for Hawaii's seniors.

The governor also wants to raise Hawaii's minimum wage from $7.25 an hour to $8.75 an hour starting in January 2014.  He said the minimum wage has not increased for more than six years and 19 other states and the District of Columbia have higher minimum wages with less to confront in cost of living.

Gov. Abercrombie will also reopen the Kulani Correctional Facility by July 1, 2014 to restore jobs on the Big Island and return more than $5 million a year to Hawaii currently spent on Arizona correctional facilities.  The new Kulani will work with the University of Hawaii at Hilo to provide inmates who are two to four years from finishing their sentences.

Other highlights of the State of the State: