Gov. Linda Lingle told the state Legislature yesterday she may veto more than two dozen bills, including one that would provide free basic health insurance to children who are not covered by state or private health plans.

The bill, a partnership between the state and the Hawaii Medical Service Association, would close a gap in healthcare that has left several thousand children uninsured. But administration officials said they are concerned the bill might inadvertently draw children away from the more comprehensive healthcare offered through Quest, the state's medical insurance program for the poor.

The administration also fears it might lead some companies to drop quality healthcare coverage for workers' children with the understanding the children would qualify for the free state and HMSA health plan.

Lingle has until July 11 to veto the bills and state lawmakers can return for a special session to consider overrides. State House and Senate leaders said after the legislative session ended in May that they did not expect to return for a special session, but said yesterday they had not made a final decision.

Two bills that might have prompted a special session — an increase to the cigarette tax to pay for cancer research and a ban on residential development in Kaka'ako — did not make the governor's possible veto list.

Instead, Lingle targeted 28 bills, including ones to expand unemployment insurance, limit mercury in vaccines, ban the sale of 'opihi, create a state monument to preserve the Ahu o Laka sandbar near Kane'ohe, and add two-liter bottles to the state's redemption program. Lingle vetoed five bills while the Legislature was still in session.

"While I recognize that the Legislature and many in the community worked hard to pass these measures, it is ultimately my responsibility as governor to ensure that the bills are legal, constitutional, fiscally sound, and in the best interest of the public," Lingle said in a statement.

The Republican governor has been relatively selective in using her veto as a check on the Legislature, which is controlled by Democrats. She vetoed 50 bills her first year in office, 38 the second year, and 28 last year. Even if Lingle were to follow through and veto all the bills listed yesterday, she would still have vetoed fewer bills than former Gov. Ben Cayetano, a Democrat, did in his last four years in office.

House and Senate leaders said lawmakers — and the public — should review the bills on Lingle's list over the next several days.

"This is the public's opportunity to express its views on the potential vetoes," said Senate President Robert Bunda, D-22nd (North Shore, Wahiawa).

"We don't agree with the governor's decision to veto these bills, but we will carefully consider her reasons and discuss our next steps with leadership," said House Speaker Calvin Say, D-20th (St. Louis Heights, Palolo, Wilhelmina Rise).

Lingle's move to put the unemployment bill on the veto list showed the governor's disappointment over legislation that had been a priority for the administration. The bill would reduce the amount businesses pay into the state's unemployment insurance fund for two years, which the administration generally favors, while expanding unemployment benefits to 30 weeks, the most generous coverage in the nation.

"This bill would result in a permanent increase in unemployment insurance costs while providing only temporary relief to employers who pay into the unemployment trust fund," the governor said in her explanation to lawmakers.

The children's health insurance bill, meanwhile, was touted by Democrats as an achievement that would ensure every child in Hawai'i has access to health insurance. The state and HMSA would split the cost of a free basic health plan aimed at children who do not qualify for free coverage under Quest and are not covered by private insurance.

But Lillian Koller, the director of the state Department of Human Services, said the new plan might lure away middle-income parents who pay a premium to have their children in Quest and might lead companies to end healthcare coverage for workers' children.

"This isn't an improvement, necessarily, in expanding access to healthcare for children," she said.

State Rep. Josh Green, D-6th (Kailua, Keauhou), a Big Island doctor who worked with HMSA on the plan, said he would propose it again next session if Lingle vetoes the bill and it is not overridden by the Legislature.

"I don't see how anybody can be against insuring all children," he said.

The governor and her staff discussed vetoing the cigarette tax increase, which has technical flaws, and the development restrictions in Kaka'ako, but chose to let the Legislature address those issues again next session.

Carl-Wilhelm Vogel, director of the Cancer Research Center of Hawaii, said the governor's decision not to veto the cigarette tax is good news for the start of a new research facility in Kaka'ako.

"The increased tax revenue from this cigarette tax will benefit several health-related entities and foremost the cancer center. I'm very happy because, of course, this provides the funding stream for the new cancer center in Kaka'ako," he said.

The Hawai'i Community Development Authority, the agency guiding redevelopment in Kaka'ako, earlier this month urged the governor to veto the development ban. The agency has terminated a controversial project that included two high-rise condominiums on state land between Kewalo and Honolulu harbors makai of Ala Moana, but sought a veto of the bill to keep housing as a possible future use in the area.

Reach Derrick DePledge at ddepledge@honoluluadvertiser.com.