Bills to focus on when session reconvenes
/Update 5/7/20: Legislators will reconvene session on Monday, May 11th regarding budget bills and various state board and commission member confirmations. Session will last 6-10 business days. Only written testimony will be accepted and committee meetings and floor sessions will be livestreamed on Olelo. Read more here.
The legislative session has been temporarily suspended since March due to the COVID-19 pandemic. Although legislators are in recess, we commend our elected leaders for staying active and engaged in COVID-19 relief efforts- responding to constituent needs and frequently communicating to the public via social media, email blasts, and live streaming Zoom town hall meetings and their weekly House and Senate COVID-19 committee meetings.
The focus of legislators has been COVID-19 relief and response (rightfully so), but we know that legislators need to reconvene and adjourn session at some point before July 1st, when the fiscal year starts over. While the format and content of legislative session is still TBD, here are some thoughts on what legislators will and should prioritize:
#1 Top Priority will be COVID-19 Relief-
Over 220,000 Hawai‘i residents have applied for unemployment insurance since the pandemic hit, representing about 30% of the state’s workforce. UHERO estimates that even with economic reopening efforts, over 100,000 workers will remain unemployed through the end of 2020. With additional CARES Federal funding up in the air, legislators will be facing critical budgetary decisions when they reconvene session. Here are the budget bills still alive that legislators are looking at:
COVID-19 specific bills - HB1629 , SB75
We support our legislators providing essential health protections and economic relief directly to Hawai‘i’s people. Nurses and health workers need masks and protective equipment to survive on the front lines of this crisis and we will need to increase our testing and contact tracing abilities to contain the spread of the virus. Meanwhile, workers and families need further economic relief in the form of more generous housing assistance, unemployment insurance, food security aid, help with childcare, and measures to halt evictions, foreclosures, and utility shut-offs.
Supplemental executive budget bills - HB2200 HD1 , HB2500
Technically, the legislature does not have to pass a supplemental executive budget bill, as appropriations for fiscal year 2021 were already passed last session. Ultimately Governor Ige has authority on budget cuts to state departments and programs, but legislators may want to inform his decision making (such as opposing a proposed 20% pay cut state workers) by passing a supplemental budget bill with updated economic projections in mind.
Capital Improvement Projects (CIP) bill - HB2725
To stimulate our local economy, legislators are looking to this updated list of shovel-ready CIP to expedite construction of projects that have already been funded, as well as potentially funding other CIP this year. Sierra Club agrees that Hawai‘i’s infrastructure is in need of investment and repair, but we also know that we can protect our environment, and even strengthen it, by investing in infrastructure the right way, without weakening our bedrock environmental laws and implementing shortsighted tactics such as automatic permit approvals. We encourage legislators to prioritize CIP that will create good jobs and enhance climate change resiliency - such as energy efficiency, solar PV construction, local food production, and watershed protection.
Use of Emergency Funds
Our state does have some reserves that can be used for COVID-19 relief, such as the $381M in the Emergency Budget Reserve or “rainy day fund”, $186M in the Hurricane Relief Fund, $569M in the Unemployment Insurance Trust, and $300M for Temporary Aid to Needy Families. More information about these funds can be found here.
Other Fiscal Bills:
If legislators consider passing other bills upon reconvening session, here are a few bills that are still alive that should be considered and could assist with balancing the budget.
Taxing Real Estate Investment Trusts - SB2697
Last session the legislature passed a bill that would generate an estimated $65M in revenue from imposing a corporate income tax on Real Estate Investment Trusts, majority of whose shareholders are not residents of Hawai‘i. Disappointingly, Governor Ige vetoed this bill, but a similar bill is still alive and moving that if adopted this session would help address our budgetary shortfall and have REITs pay their fair share of taxes.
Raising taxes on the wealthy - HB2385
This bill would increase taxes on high income earners in the state for taxable years beginning 2021, generating $60M in state revenue each year. This bill would raise the state income tax rates on earnings above $200,000 for joint filers, $150,000 for heads of households, and $100,000 for single filers. Hawai‘i’s lowest-income households are being hit hardest by COVID-19 and pay 15% of their income in state taxes, while top earners in the state pay only about 9%. This bill helps to address tax inequity and would provide beneficial tax revenue for Hawai‘i.
Defending Hawai‘i’s solar tax credit:
With recent budget shortfall discussions, we know legislators are considering passing a bill that would eliminate Hawai‘i’s solar tax credit. The Sierra Club opposes such efforts. The solar tax credit supports over 4,000 solar jobs in an industry that is 70% locally owned and operated. While our tourism economy is severely struggling, the solar industry employs thousands of local installers, contractors, sales people, electricians, and many others in good paying, sustainable jobs that help to diversify our economy. The tax credit has also resulted in significant progress towards our state’s clean energy goals and has helped dropped the average electricity bill by 20% for all ratepayers, not just those who benefited from the solar tax credit. Furthermore, a study shows for each solar tax credit dollar spent, the State receives $1.97-$2.67 dollars in additional tax revenues, meaning that the state makes $137 million from a $70-million-a-year expenditure. We need to keep the solar tax credit.
Non-fiscal Bills:
Several good environmental bills could still be passed this session that have received little or no testimony in opposition, would require no state appropriation, and would address climate change impacts and boost our resiliency:
Sea level rise disclosure for real estate transactions- HB1878. Sea level rise disclosure is a common sense solution to help address the $19 billion that Hawai‘i faces in estimated private property loss from sea level rise and the 6,500 structures such as hotels, malls, and businesses that will be impacted. Seller disclosure is required for homes in flooding and tsunami zones and we have existing maps that show which properties will be impacted by sea level rise.
Updating Coastal Zone Management Laws- SB2060. Amends state coastal zone management laws to protect against impacts from sea level rise and coastal erosion. This bill provides important guidance to the counties to help to prevent seawalls and other shoreline hardening structures which destroys beaches, cultural resources, and coastal ecosystems.
Coal Free by 2023- SB2629 Proposed HD1. Hawaiʻi has one last coal plant on Oʻahu, whose contract is set to expire in two years. HECO and the PUC have testified that they have no intention to extend the coal contract beyond 2022. This bill aligns with the termination of the coal contract and would make Hawai‘i coal free starting 2023.
100% Clean Ground transportation goals- HB2699. This bill aligns state goals with existing county commitments for clean ground transportation. Sets goals for state agencies on a staggered basis until achieving a 100% light-duty motor vehicle clean fleet by 2035, and for all light-duty motor vehicles in Hawai‘i by 2045.
As Hawai‘i’s people face the COVID-19 crisis, the critical decisions made in the coming weeks by state leaders will shape Hawai‘i’s ability to quickly respond and recover from this pandemic. The Sierra Club supports workers and vulnerable communities and will seek legislative solutions to rebuild our economy and infrastructure in a way that avoids the pitfalls that have created Hawai‘i’s over-reliance on tourism, massive wealth inequality, lack of food and energy self-sufficiency, and continued environmental degradation.