Hawaii Version of Stimulus Package Proposed

A state legislative hearing is set for Friday on Hawaii’s version of President Obama’s stimulus package.

The bill would authorize the sale of $500 million in general obligation bonds to fund repair and maintenance projects across a broad spectrum of state departments and agencies including the state’s public schools, the University of Hawaii system and the state Judiciary.

The measure also contains provisions to streamline the process through which the projects are bid and contracted.

Senate Bill 2012 is unusual in that nearly all of the Senate’s 25 members have signed up to co-introduce the bill, including the Senate’s lone Republican, Sen. Sam Slom.

The only exception is Sen. J. Kalani English. According to the Maui lawmaker’s staff, English supports the legislation but was taking part in a United Nations development program in the Marshall Islands when the bill was introduced.

The legislation is designed to provide work for the state’s anemic construction industry at a time when interest rates are at record low levels. It said those low rates were reflected in a recent bond sale of $1.3 billion – the largest in the state’s history – which saved the state $59 million through restructuring of its outstanding debt.

The bill said borrowing an additional half-billion dollars through a bond sale would allow the state to whittle down the backlog of repair and maintenance needed for state facilities estimated to cost well over $1 billion.

The measure is designed to help fulfill the Legislature’s primary objective this session which is to stimulate the creation of jobs. It said capitol improvement projects have in the past created approximately 13 direct and indirect jobs for every $1 million spent.

The focus of new CIP projects should be projects involving repair and maintenance and those addressing health and safety concerns to ensure “well-maintained state facilities and infrastructure,” the bill said.

The legislation would also provide unspecified funding for the addition of renewable energy sources such as photovoltaic systems for public schools and other state facilities.

Donalyn Dela Cruz, Gov. Neil Abercrombie’s press secretary, said Wednesday that the governor strongly endorses the intent of the measure.

“Anything that’s going to promote jobs and stimulate the economy the governor would support,” she said.

Dela Cruz noted that was one of the pillars of the governor’s State of the State address. Abercrombie said in that speech that in the absence of rebounding private sector investment and construction, the government needs to “step up to invest in repairs and maintenance, construction projects and infrastructure improvements.”

In its current form, the bill does not contain specific projects or funding amounts for the various state agencies mentioned.

The bill also contains a provision to expedite the process through which construction projects and goods and services are obtained by temporarily raising the cap on projects carried out under rules designed to simply the bidding process known as “small purchase procedures.” The initial draft of the bill raised the cap to $250,000 from the current $100,000, while a subsequent draft of the bill would further raise that limit to $1 million and also disallow protests of bid awards up to that amount.

The measure would also make the projects exempt from the need to obtain county building permits, although they still must meet “all federal, state, and other applicable county code requirements.”

County Planning Director Bobbie Jean Leithead-Todd said she wanted to wait to see the bill’s final version before commenting on that aspect – particularly as to how it affects Special Management Area permits which come under the purview of the Department of Planning.

Building permits are handled by the Department of Public Works, but its director, Warren Lee, could not be reached by Big Island Now in time for this article.