Gov. David Ige’s administration has caught heat from the public and media alike over the last several weeks for not spending federal CARES Act funding rapidly enough.
On Wednesday, the governor spoke to those concerns, as any money that goes unspent by the end of 2020 is returned to federal coffers.
“I understand that some people are concerned that we are not spending our share of coronavirus relief funds quickly enough,” Ige said. “We do not plan to return any of the coronavirus relief funds. We are going to use every penny.”
The most immediate initiative involves $5 million the state unemployment (UI) office will use to staff a new 200-person call center, which began operations Wednesday. Fifty employees manned the center on its opening day. Anne Perreira-Eustaquio, director of the state Department of Labor and Industrial Relations, said that number will ramp up to 120 employees by Monday and will reach full capacity by the end of next week. The call center will address both traditional unemployment and Pandemic Unemployment Assistance (PUA) claims.
To date, DLIR has serviced approximately 200,000 claimants, processing 96% of those claims, according to numbers provided by Perreira-Eustaquio. However, several hard-to-handle claims have caused nagging problems with the disbursement of UI funds to some Hawai‘i residents.
To help navigate that, a portion of the $5 million will also be used to create a new communication center. As part of the initiative, 100 new UI claims adjudicators will attempt to reduce the backlog of traditional UI claims where a dispute on eligibility exists.
“This dramatic ramp-up of unemployment professionals who have experience in addressing other states’ backlogs looks poised to help address Hawaiʻi’s lingering unemployment backlog,” said Rep. Aaron Ling Johanson, House Labor and Public Employment Committee Chair. “Lack of manpower has been the biggest barrier to fixing the unemployment backlog. This dramatic step by the administration is critical to overcoming that barrier and effectively helping those awaiting their unemployment benefits.”
The UI call center numbers are as follows: (833) 901-2272 and (833) 901-2275.
Where will the money go?
Hawai‘i has received more than $1.2 billion in coronavirus relief funds since the pandemic began, including more than $850 million under direct state control, nearly $400 million under the purview of Honolulu County, and roughly $175 million allocated to neighbor islands.
The governor said he put much of that funding aside, waiting to spend it until the administration could figure out the most efficient avenues of distribution as well as to see if more federal funds would come, the arrival of which might have changed allocation strategies.
Ige said Wednesday that he’s been all but assured during talks with Washington that no new funding is likely on the way before the end of the year. He then unveiled three broad initiatives for which 98% of the CARES Act money is reserved.
- Protecting public health: Includes contact tracing and vaccination strategies
- Reviving the economy: Includes the pre-travel testing program, small business support, and job creation
- Strengthening the community: Includes UI benefits, rental and home loan assistance, and returning students to their classrooms
More specific allocations were noted in a statement released by the governor’s office following his press conference Wednesday.
- $100 million for rent and mortgage relief
- $14 million to bring in nurses and healthcare workers from the mainland to support the local healthcare industry
- $10 million for job retraining programs
- $31 million for devices and connectivity to support schools
- $61 million for PPE and supplies for schools, hospitals, and businesses
“We understand the urgency of this funding,” the governor said. “We’re working tirelessly to get the money out.”
Several state and county grant programs are now in effect, and individuals as well as businesses are encouraged to inquire and submit applications to those programs for which they qualify.
The governor also announced a new dining card program funded by $75 million from the CARES Act, which is meant to assist both Hawaiʻi’s unemployed and its restaurants.
Sherry Menor McNamara, president and CEO of the Chamber of Commerce of Hawai‘i, and Denise Hayashi Yamaguchi, executive director of the Hawaiʻi Agricultural Foundation, said the dining card program offers displaced workers a pre-paid $500 dining card for use at any Hawai‘i restaurant.
Any money that remains after all initiatives are funded, Ige said, will funnel into the UI trust fund and be used to pay back a portion of a $1 billion loan the state negotiated from the US Treasury to pay out claims over the last several months.
A website, www.hawaiidata.org/federalfunds, has been created via a government/private sector partnership with the Hawai‘i Data Collaborative to track federal funding coming into the state, as well as how, when, and to whom it is disbursed. This includes all federal funding, not just CARES Act funding, and thus tracks more than $10 billion in federal dollars.
Pending budget crisis
Economists project a $2.5 billion loss of revenue over the next 18 months, largely due to decreased tax revenues caused by the decimation of Hawai‘i’s tourism industry.
On Wednesday, the governor said employee furloughs, along with other measures, remain under consideration as a path toward a balanced budget, which the state’s constitution mandates the administration produce.
Ige wouldn’t provide a specific number on how many jobs of state employees, such as teachers and first responders, may be at stake, saying only that negotiations with relevant labor unions are underway.
He did, however, confirm that Hawai‘i will likely need to find in the neighborhood of $330 million in relief via labor savings to have a realistic chance to balance the budget.
The governor also floated $1 billion in construction bonds in recent months, adding that the state will look to borrow between $750 million and $1 billion from the US Treasury’s Municipal Liquidity Program to patch the massive hole COVID has exploded in the middle of Hawai‘i’s budget.