Yearning for a Way to Collect Tax on Out-of-State Vendors

Secret Federal Report Reveals Half-Billion Dollar Annual Shortfall: 19% of Honolulu General Fund to Subsidize Rail Operations

SA: A federal consultant has concluded that operating TheHandi-Van and TheBus could cost city taxpayers $1 billion more in subsidies by 2030 than the city has projected.

That extra potential cost was not included in financial plans for the rail system and "may be unaffordable" for the city, Porter & Associates Inc. warned in its Jan. 25 report for the Federal Transit Administration.

The report, obtained by the Star-Advertiser under the Freedom of Information Act, says that "optimistic" city projections may be underestimating the transit subsidies required in the years ahead

A new report questions “optimistic” city estimates of the taxpayer subsidies needed to support transit operations in the years ahead. The report suggests the total subsidy from 2011 to 2030 could be $1 billion more than the city estimated.

• 19.2% -- A scenario developed by consultant Porter & Associates estimates 19.2 percent of the city’s general fund and highway fund revenues may be needed to subsidize TheBus, TheHandi-Van and the new train system by 2030.
• Annual taxpayer subsidy of the city transit system could grow to more than $518 million in 2030.
• 14.2% -- The city estimates 14.2 percent of general fund and highway fund revenues will be required to subsidize TheBus, TheHandi-Van and the new train system by 2030.
• Annual taxpayer subsidy of the transit system would grow to about $372 million in 2030 under city projections.

read … More Secrecy

Hawaii Credit Union League: State Bank is Extremely Dangerous, Puts Taxpayer Money at Enormous Risk

SA: A state-owned bank could provide loans for alternative energy and technology projects or purchase the homes of families facing mortgage foreclosure to avoid evictions.

The state has more than $4 billion in assets at financial institutions, including $2.8 billion in Hawaii-based banks, mostly at First Hawaiian Bank and Bank of Hawaii. A state bank could hold some or even all of the state funds now deposited in private banks, assuming both the risk and the profit of managing taxpayer money….

Budget advisers caution that a clean economy bank could overextend the state's financial resources and have a detrimental effect on the state's credit rating. Bank deposits would be guaranteed by the state, budget advisers said, which could restrict the state's ability to issue bonds because the deposits would count against the state's debt limit….

Gary Fujitani, executive director of the Hawaii Bankers Association, urged lawmakers to conduct a thorough study to determine whether there is a legitimate unfilled need for a state bank. Aside from the complex and potentially costly requirements of starting up a bank, he said, there could be an inherent policy conflict. He asked whether a state bank's mission of doing social good would conflict with running a sound bank for profit, and whether politics might influence lending practices.

"We may not be making loans, we may be making investments," he said of a state bank, adding that with loans, the expectation is that the money will be repaid.

While Fujitani was measured in his opposition, others have been harsher. The Hawaii Credit Union League called the creation of a state bank that would also purchase troubled mortgages "an extremely dangerous concept, which would place taxpayer money at enormous risk."

State House Minority Leader Gene Ward (R, Kalama Valley-Hawaii Kai) has been incredulous over some of the details in the bills. Gov. Neil Abercrombie would be the board chairman of a clean economy bank, for instance. The seven-member board would also include appointees chosen by the AFL-CIO and Change to Win, a labor coalition.

Conservatives have already started with the "Bank of Abercrombie" jokes. Ward questioned whether the governor, who has a Ph.D. in American studies and a master's degree in sociology, is qualified to serve as bank chairman.

At a hearing before the House Finance Committee last week, Ward tried to press Blake Oshiro, Abercrombie's deputy chief of staff, on the governor's position on the House's proposal.

"Is your boss prepared to become the chairman of the board of the state bank of Hawaii?" Ward asked.

Oshiro, a former House majority leader, was diplomatic.

"I think it all depends on what is the will of the Legislature and what is the policy call, and at that point we will make the proper decision," Oshiro said

>> Task force (HB 1840): A task force would study the history of the Bank of North Dakota and other models nationally to determine whether a state-owned bank in Hawaii is feasible.
>> Clean economy bank (HB 1033): A clean economy bank would provide loans to help finance alternative energy and technology projects in Hawaii and other states. A Hawaii First fund would focus on projects and businesses in the islands. The governor would be the chairman of the bank’s seven-member board, which would appoint a bank president.
>> State bank (HB 2103): The state Department of Commerce and Consumer Affairs would conduct a comprehensive review of state laws and regulations to help develop a state bank. A final report before the 2014 session would include a graduated schedule for transferring state money from private banks into the state bank and a short-term state purchase program for distressed residential properties facing mortgage foreclosure. The Housing Finance Development Corp. would establish an interim state purchase program for distressed homes — and allow homeowners to buy the mortgages back — until the state bank becomes operational.
>> Bond fund (HB 304): Allows the state to pool its bond resources with other jurisdictions that issue bonds, which could create a larger pot of money to help finance projects

read … Bank of Abercrombie

Clayton Hee Has Conference Ctte Plan to make OHA Settlement not be Final

SA: Senators on Friday agreed to advance the settlement bill unamended, which is unusual for any piece of legislation, but particularly for a topic of such consequence. Senate leaders had asked committee chairmen to pass a "clean" version over to the House, where lawmakers will now be under pressure to avoid substantive changes that could complicate passage if the bill moves into a House and Senate conference committee.

State Sen. Clayton Hee (D, Kahuku-Kaneohe), chairman of the Senate Judiciary and Labor Committee, put Abercrombie on notice Friday that he believes the settlement falls short of satisfying what OHA is due. He voted for the bill with reservations, which preserves his ability to serve on a conference committee.

"This is not a fair settlement in my judgment," said Hee, a former OHA chairman…. (Hee will try to make the conference committee determine that the ‘settlement’ is not a final settlement, just a plain give away.)

State House Majority Leader Pono Chong (D, Maunawili-Kaneohe) said the House would weigh both the settlement — Senate Bill 2783 — and the separate measure to give OHA more authority to develop high-rise apartments in Kakaako — Senate Bill 682.

"I think that's going to be part of the discussion. We're going to look at all of it as one issue," he said.

read … OHA Settlement not Yet Settled

No Money for CIP: Abercrombie Admin Kills Airport Cargo Building

Borreca: There should be another worry for both the job-hunting legislators and nervous environmentalists: Can the state really perform even if the rules and regs are dropped?

For instance, the state Department of Transportation has managed to stop funding a much-needed cargo storage facility in Hilo, even after the project started, was funded and had a contractor ready with the shovels.

Hawaii island's Tribune-Herald reported last week that the 60,000-square-foot, steel-framed cargo building was intended to bring cargo operations closer to the Hilo airport's main terminal.

It started in 2009, with typical Gov. Linda Lingle ruffles and flourishes. The paper reported that Isemoto Contracting Co. had a two-part project and it was to be completed within two years of the groundbreaking.

Now, it has completed the 50,000-foot concrete apron and taxiway for the heavy cargo planes, but no building. Federal money built the first part, but now the state can't come up with its share.

"The cargo building construction is still pending the availability of funding," Daniel Meisenzahl, DOT spokesman, told the Hilo newspaper.

"Some time after construction started on the ramp and hard stand, it was determined that the Airports Division did not have the funding," he said.

HTH: Hilo Airport cargo facility stalls

It's also tough to compete when no Big Island lawmaker sits on the House Transportation Committee, and only one serves on its equivalent in the Senate.

State Sen. Gil Kahele, when asked about the status of the cargo facility, contacted an Airports Division administrator to ask what the Abercrombie administration plans to do.

"They don't have the money yet," Kahele said. "What they need to do is float bonds.” (Gee. Didn’t Abercrombie float billions in bonds just a couple of months ago?)

Related: Stimulus? Abercrombie CIP Contract Awards Drop by 86% from Lingle

read … Abercrombie Kills CIP

Building slump cuts lending by isle banks

SA: Loans made by the top banks have declined 66 percent in four years

read … Down 66%

Shakedown: DoE Officials Threaten to Cut GED Programs Unless Legislators Fork over More Money to Failing System

SA: Hawaii's 10 state-funded adult community schools are the only authorized examiners of GED diploma testing in the islands. Securing approval to provide GED diploma testing takes about a year….

More than 9,000 people in the islands attended courses at community schools in the 2010-11 school year. That number includes about 1,500 16- to 18-year-olds who had formally opted out of traditional public schools. Many were seeking GED diplomas.

Dale Asami, acting director of the Department of Education's student support branch, said while the state is working to ensure GED diploma testing and courses remain robust, the DOE will have to operate within its means and reduce offerings if the budget is cut….

There is no money for adult education next school year in the Department of Education's current budget because officials shifted the funds to K-12 programs. The governor has asked the Legislature for $2.5 million to keep adult schools afloat in the 2012-13 school year, which is half of what the schools had been receiving.

State Sen. Jill Tokuda, chairwoman of the Senate Education Committee, said it's too early to say how much funding adult schools will get this session. But she said there are some big questions about spending on adult education, including whether the state needs to spend so much of its adult school budget on administration. (Community schools each have their own principal.)

Totally Related: Washington Monument Gambit

read … Shakedown

SB2594: Lawyers Renew Push for Homeless Tent Cities

SA: Among the expected advances in help for Hawaii's homeless is expected to be the city's "Pathways Project" aimed at providing housing and health and social services for the chronically homeless. Mayor Peter Carlisle said in his Feb. 23 State of the City address that requests for proposals from nonprofits to run the program, as well as further details of the plans, will be released within a few weeks.

The release of a new policy brief on homelessness has drawn a spotlight, but other ideas are being floated. A roundup of a few new initiatives and proposals follows….

Legislation under consideration:

• SB 2568, to give counties responsibility to provide information on temporary shelters to people cleared from unauthorized encampments.
• SB 2594, to appropriate $100,000 and require that the state Department of Human Service Homeless Programs Office establish "safe areas" statewide that provide clean eating areas, showers, toilets and laundry facilities.
• SB 901, to set aside an undetermined amount of funding for a landlord liaison project to give landlords incentives to relax screening criteria and enabling the placement of more homeless people in private rentals.

related: Homeless tent cities: Seattle’s decade-long nightmare coming to Honolulu?

Status: SB2594 SD2 (Third Reading in House March 6)

SA: LEJ Behind Push for Homeless Tent Cities

read … Efforts take aim at homelessness

Democrats to caucus Wednesday

MN: The gatherings are only for Hawaii Democratic Party members. Registered voters may join the party that evening and vote in the caucuses and district/precinct elections.

Precinct/district elections determine the organization, staffing and direction of the Maui Democratic Party, said Karen Chun, a party official. District and precinct officers and delegates to the state convention also are selected. Hawaii's delegation to the national convention, where the party's presidential candidate is nominated and the party platform is established, are chosen at the state convention.

The presidential caucus is essentially the Democratic presidential primary, Chun said.

President Barack Obama is the only major candidate running on the Democratic side, though write-ins are allowed, said Chun.

related: Hawaii Republican Presidential Caucus March 13

read … Caucus

Star-Adv Hits Rail over Seat Secrecy

SA: Jurgen Sumann, the Honolulu rail project's chief systems manager, sounded a defensive tone in a written response to questions by the Star-Advertiser. "People will get on and off along the rail route, as is the case of any transit system, and seats will open up along the way," he said. "For train passengers with shorter commutes, standing may be preferred to ensure they are able to conveniently and quickly exit the train at their designated stop."

The Jacobs report, though, wisely noted that expectations are important at this stage. Further, it stated, the concern is that "given the length of time that most passengers would be expected to stand on most trips, the system might fail to achieve forecast ridership levels."

HART was less than open about this report, which was completed last October but not released to the public. The Star-Advertiser's Kevin Dayton learned of its existence from correspondence between HART and the Federal Transit Administration. Such an important assessment, which casts such sharp scrutiny on Oahu's $5.7 billion rail project, should have been publicly released and been made accessible online; it has not.

The cars, along with the rail's operating system, will be produced under a $1.4 billion contract signed last year with Ansaldo Honolulu JV. Rail transit is supposed to entice commuters out of their cars, and win skeptics over with its speed, efficiency and positive experience. HART needs to make every effort to be smart from the start but be ready to address questionable specifications, such as too few seats, down the track.

read … Secret Straphangers

WSJ: E-Cigarettes Draw Fire From Legislatures

WSJ: A survey by the Centers for Disease Control and Prevention indicated 2.7% of U.S. adults had tried e-cigarettes by 2010, up from 0.6% a year earlier….

E-cigarette users—so-called vapers—and some health experts are urging regulators to tread lightly. They say e-cigarettes help nicotine addicts quit more harmful traditional cigarettes, which release most of the toxins that cause disease through combustion, and eliminate the problem of secondhand smoke.

"We finally found something that worked; we quit smoking, and they want to ban it,'' said Elaine Keller, president of the nonprofit Consumer Advocates for Smoke-Free Alternatives Association, a consumer group that has received funding from e-cigarette companies but is mainly supported by e-cigarette users. …

Lawmakers in Hawaii have moved to ban the sale of e-cigarettes to minors. But they backtracked last month on taxing the products at the same rate as traditional cigarettes after receiving more than 1,000 written submissions, many from e-cigarette users opposing the measure.

read … Tobacco Tax Revenues?

As House Burns, Man Vents Anger at Hawaii County Planning Department

HTH: Oddly enough, losing his house isn't what burns Thompson. On Feb. 23, the state published a draft environmental assessment for a helicopter landing pad at his property. Paradise Helicopters was seeking a special permit to build a 15-by-15-foot platform, but now there's no place for visitors to go. Asked about this, he unloaded years of frustration at the county Planning Department, which had prevented him from keeping a bed and breakfast or hosting visitors on helicopter tours.

"Unfortunately, the fools down at the Planning Department fooled around for a couple of years that I could have been making some money," he said. "We could have been having a good time. The tourists could have been having a good time. But while they fooled around down there and playing their little games: 'Let's have a little environmental impact study and let's see if there's any endangered plants out there or any endangered fruit flies' or something. I mean, it's ... ridiculous."

"That's the worst part of it. The rest of it, I can handle. It's nature. It's not some damn fool trying to harass you so that they can have a job."

SA: Future unclear for last Royal Gardens resident

Related: Red Hot Lava Menaces Old-boy Scam

read … Department of Retaliation

Seniors face unique issues caring for grandkids

MN: Paranada and Lawson are among the estimated 1,400 grandparents who have taken responsibility for the grandchildren living in their households….

Last month, Greenwood prepared a report, titled "2010-2011 Needs Assessment Report," as a guiding document for the group for the next five years….

Among the findings of the report:

• Substance abuse was the top reason parents were not present in the household, in 13 of 50 responses to the question. Other reasons included parents living off-island for employment or deployment, jailed, deceased, divorced or ill.
• The average age of survey respondents was 59.8 years old. Thirty-one percent of the respondents were ineligible for financial assistance from the Maui County Office on Aging because they were under the 55 minimum age requirement.
• One-third of respondents were caring for at least one child with special needs.
• Forty-eight percent of the respondents had incomes of more than $40,000; 20 percent, $25,000 to $40,000; 16 percent $15,000 to $25,000; and 16 percent $15,000 or less.
• Native Hawaiians were over-represented, while Japanese and Filipinos were under-represented based on Hawaii's ethnic demographic.
• Grandparent respondents were longtime caregivers; most began caring for their grandchildren six to 10 years ago.

In the report, nearly half of respondents reported "no formal legal relationship" with the grandchildren they were caring for. These grandparents without legal custody often will keep quiet and not avail themselves of community resources because they are afraid of losing their grandchildren to Child Welfare Services, Greenwood said.

The lack of legal responsibility creates practical problems, especially when trying to enroll children in school, signing permission forms or making decisions for children with special needs. Greenwood said the school system has implemented policies for dealing with grandparents with differing levels of legal custody of their grandchildren, but the grandparents have to ask.

read … Grandparents

Marshallese making a new life in Spokane

SR: It was May 1, and Burnham drove four young Mormon missionaries to Plante’s Ferry Park in Spokane Valley. The park was filled with 2,000 or more people – all Marshall Islanders, he was told. They were celebrating Constitution Day, a major holiday in the Republic of the Marshall Islands, located 2,400 miles southwest of Hawaii.

“The park was packed and there were grills everywhere” filling the air with the aroma of chicken, he said….

Charles Paul, the Marshall Islands’ ambassador to the U.S., said the embassy doesn’t know how many islanders have settled in North America. Some sources suggest as many as 22,000 Marshallese now live in the U.S. The islands have a listed population of 68,000, although only 53,000 of those are native Marshallese. The rest are U.S. military members, aid groups and missionaries.

read … Marshallese making a new life in Spokane

Star-Advertiser carefully sidesteps Five-0 star’s drug addiction

ILind: Did you notice how carefully the Star-Advertiser avoided saying that a Hawaii Five-0 actor is going into a treatment program for prescription drug addiction.

The headline on the Star-Advertiser story today: “‘Five-0′ star taking time off for health.” Like he’s just overworked and needs a rest. Then there’s a guarded reference to “problems with pain medication,” sounding like perhaps there a problems prescribing the correct dosage or something.

The terms “addiction” or “addicted” don’t appear anywhere in the story. Nothing about drug abuse.

read … Drug Addict

Kailua Begins Fireworks Fundraising Push

HR: It's been three years since a small group of citizens saved the Kailua 4th of July Fireworks, an event that has been a mainstay in the Kailua community for more than 60 years . In 2008, three Kailua residents realized in June, four weeks before the event, that the Kailua Chamber of Commerce was no longer coordinating details for this event and the 4th of July fireworks were not going to take place.

More than $50,000 was raised in 4 weeks and permits obtained. Each year since, the event has made its fundraising goals with the help of Chuck Cotton and Clear Channel, small businesses and organizations, and the residents of Kailua.

read … Kailua