Building Schools

by Tom Yamachika, Tax Foundation Hawaii

In this past legislative session, we were closely watching a bill that would have axed the “school impact fees” that housing developers now have to pay.  As we have pointed out before, the fees have been collected but have not been used, and for a very long time. 

During testimony on the bill, House Bill 422, it was pointed out that there are lots of restrictions on the school impact fees collected.  The fees need to be spent on new schools, not on maintenance or operation of existing schools.  Furthermore, the fees need to be spent in the district in which they were collected.  They can’t go anywhere else.  Although there is more than $29 million in the special funds receiving the impact fees, it’s tough to spend that money.  One elementary school costs $80 million to build, and with school enrollment statewide on the decline, it’s tough to justify building a new school of any kind any time soon (with the possible exception of Maui, but we’ll get to that). 

Yet, the Department of Education begged and pleaded for the fee not to be eliminated.  The Department came up with a “compromise” whereby the construction cost component of the school impact fee would be tossed out while the land cost component of the fee was kept intact.  The bill implemented the compromise, but did nothing about the restrictions that made it impossible to spend money from the special funds, which means that the funds will continue to collect money and will be unable to spend it.  Lawmakers passed the bill and sent it up to the Governor.  It’s now past the time to notify the Legislature of potential vetoes, so the bill will become law with or without the Governor’s signature.  

In the meantime, the Department of Education has been trying to get our lawmakers to spend general fund money on our schools.  As Hawaii News now reported, they have been having a hard time.  The DOE requested $1.9 billion.  Lawmakers funded $489 million.  Specifically, lawmakers rejected at least two requests for new schools. 

First, lawmakers shelved a request to build a new school in Lahaina to replace King Kamehameha III Elementary, which was destroyed by the Lahaina fire.  The problem there was that there were some differences of opinion on where to build the new school.  One proposal was to build it at Pulelehua where FEMA built a temporary campus, which has infrastructure such as utilities but, according to the DOE, is not where the community wants it.  Supposedly, the community would rather have the school built on undeveloped land at Kuia, but that land has no infrastructure and not much of a surrounding community.  

The second planned new school on the cutting room floor was a proposed elementary school in East Kapolei on Oahu.  According to Senate Ways and Means chair Donovan Dela Cruz, it’s unclear whether the DOE public works team or the recently formed School Facilities Authority would be in charge.  And “both organizations have not proven to be able to build in a timely manner,” he said.  So, to sum up the current state of affairs, the proposed new school is 86ed because the School Facilities Authority, which was formed to build schools more quickly and efficiently than the DOE’s existing staff, is having a turf war with said staff.  This is a pickle not easily solved. 

Will the adults in the room please stand up, put an end to the turf war, and then rip up the special funds that are tying up money that can and should be used to maintain and operate the schools we do have?