Tuesday, July 16, 2024
Hawai'i Free Press

Current Articles | Archives

Sunday, August 9, 2020
How We’re Going to Spend CARES Act Money
By Tom Yamachika @ 5:00 AM :: 2968 Views :: Economy, COVID-19

How We’re Going to Spend CARES Act Money

by Tom Yamachika, President, Tax Foundation Hawaii

Imagine what would happen if a genie came up to you and said, “Here’s a pot of money for you.  All you need to do is spend it by the end of the year.  If you don’t, whatever you haven’t spent will disappear.”  What would you do with it?

Our State government just got that genie visit.  The genie is called Uncle Sam, and the pot of money contained $1.25 billion.  Our recently passed budget bill, SB 126, parceled it out – or tried to.

The largest chunk of the money, around $560 million, was given to county governments.  Honolulu received about $387 million, the Big Island $80 million, Maui $67 million, and Kauai $29 million.

Then, the Legislature called for $230 million to be spent on a State enhancement, or “plus-up,” to the weekly benefit to those now on unemployment.  The federal government’s extra $600 per week ran out at the end of July, and, as of press time, no deal was in place to extend the benefit.  The idea was for the State to kick in $100 per week from August 1 to December 31, but that won’t happen because Gov. Ige has line-item vetoed this appropriation.  According to the Governor’s office, he prefers to wait until the federal government reaches a deal on what to do on their end.  This reasoning, if true, would be strange because there is already a provision in the appropriation saying that the $100 per week isn’t payable if the federal government is kicking in more than $300 per week.  In the meantime, the unemployed need to survive without any plus-up at all.

The bill appropriated $100 million to assist childcare, elderly care facilities, hospitals, small businesses, nonprofits, and schools in buying personal protective equipment.  The Hawaii Emergency Management Agency (HIEMA) is supposed to be on top of this program.  The Governor chopped the $100 million to $61 million.

The bill also appropriated $100 million for a housing relief and resiliency program, administered through HHFDC.  There, the idea is to give assistance – 50% of rent payable up to $500 per month from August 1 to December 31 – to renters and homeowners impacted by COVID-19 and whose income level doesn’t exceed 100% of Area Median Income (which is about $101,600 for a family of four here).  The Governor slashed the $100 million to $50 million.

The bill directed $90 million to the airports, specifically to augment airport screening and health assurance security initiatives.  On the Department of Transportation’s wish list is a thermal screening system, a Web-based traveler verification application, traveler verification rooms (sounds like interrogation rooms), a swab and testing facility, and a service contract for testing.  The Governor reduced the appropriation to $70 million.

There are many other appropriations of lesser amounts.  Some of them were reduced.

And, of course, there is a “slush fund” category.  $40 million is appropriated to the Governor’s office, supposedly to take care of any unanticipated needs.  That appropriation wasn’t reduced.

Finally, there is a catch-all clause.  Any money appropriated but unspent as of December 28 is sent to the Unemployment Insurance trust fund, and hopefully that money will help soften the automatic increases in the unemployment taxes that otherwise are triggered at the end of the year, as we recently wrote about.  But a big question remains:  Are moneys dumped into the trust fund “necessary expenditures incurred” before the end of the year, within the meaning of section 5001 of the CARES Act?  If we can’t answer this question with a definitive “Yes,” we had better get some clarity from the federal government pronto, or risk having to pay that money back to the genie.  And the $366 million that was line-item vetoed is unappropriated money that won’t even be going to the trust fund.  Those dollars will be disappearing unless we do something about it ASAP.

We don’t get a genie visit that often, so we had better make the best of it when it does happen.


TEXT "follow HawaiiFreePress" to 40404

Register to Vote


Aloha Pregnancy Care Center


Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii


Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute


Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together


Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii


Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii


National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii


OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii


Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii


Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns


West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii