Nearly $24B state budget will tackle priorities including education, affordable housing, health care, Maui recovery

Hawaiʻi Gov. Josh Green on Tuesday signed the state’s supplemental budget, which provides $19.1 billion for operations and $4.5 billion for capital improvement projects throughout the state in fiscal year 2025.

The budget bill, House Bill 1800, represents an increase of more than $480 million, with significant funding going to key state priorities.

“This budget makes historical investments in affordable housing, health care, climate and education — all of our big priority areas as a state,” said Green upon signing the budget bill Tuesday. “It will provide over $200 million for Maui’s recovery efforts through the Major Disaster Fund. In addition to what is funded in the budget, we passed historical tax reform this session which will put more money into the pockets of local families to combat inflation.”

He added funds for building affordable housing, giving more money back to families through the new tax plan he recently signed into law and boosting the state’s social services and access to health care will also allow more families to afford to stay and thrive in Hawaiʻi.

Here are the top five priority areas funded in the supplemental budget.

Affordable housing and reducing homelessness

Housing continues to be a major issue. Families continue to leave the state because of a lack of affordable housing. With 21 kauhale, or tiny village homes, and 13,000 new affordable units set to be built by 2026, Green’s Administration has demonstrated its deep commitment to building housing for all Hawaiʻi residents, especially for its most vulnerable groups.

The supplemental budget continues the administration’s multipronged approach by funding:

• $230 million in general obligation bonds for Hawai‘i Housing Finance and Development Corp. to finance additional affordable housing statewide.
• $33 million for kauhale projects statewide for the Office on Homelessness and Housing Solutions.
• $10.5 million in general funds for the Hawai‘i Public Housing Authority rehabilitation and repair of housing units.
• $5 million in general funds for Hawai‘i Community Development Authority to build supportive housing and support services.
• $1.5 million in general funds for the State Rent Supplement program for Hawai‘i Public Housing Authority to help low-income residents pay rent.
• $1.32 million in general funds for state homeless programs contract increases.

Investing in Hawaiʻi’s health care systems

Access to quality care is a key pillar of Green’s “The Hawaiʻi We Deserve” policy framework. Ensuring all residents have access to high-quality, comprehensive health care services is vital to the well-being and resilience of the state’s people.

With the recently expanded Health care Education Loan Repayment Program to provide loan repayment assistance to Hawaiʻi’s health care professionals, as well as unprecedented private investments into statewide health care systems, the Green Administration is committed to making historical investments into the state’s health care system. This will create positive downstream effects in building resilient and healthy communities while generating long-term cost-savings by providing upfront access to quality health care services.

The supplemental budget includes:

• $30 million in general funds and $42.3 million in federal funds to increase the rate of the Medicaid reimbursement for health care providers to be equal to Medicare.
• $18.8 million for contracts for the Child and Adolescent Mental Health Division.
• $17.4 million in general funds for the Maui Health System operating subsidy.
• $13 million for locum tenens (substitute practitioners) for Adult Mental Health – Inpatient at Hawai‘i State Hospital.
• $9.5 million for the Hawai‘i State Hospital.
• $8.8 million in general funds for new and existing group home services.
• $6.8 million in general funds for contracts for psychiatric in-patient services for the Hawai‘i State Hospital.
• $6.6 million for Behavioral Health Crisis Center and Supportive Housing Services.
• $5.75 million in general funds and $9.7 million in federal funds for Medicaid payment adjustments for home- and community-based services.
• $4.9 million in general funds for early intervention services for the Family Health Services Division.
• $4.2 million for emergency medical services and injury prevention system.
• $3 million in general funds for mobile treatment clinics.
• $2.6 million in general funds and $3.8 million in federal funds for behavioral analysis payments for the Medicaid program.
• 4 positions and $2.1 million in general funds for positions, new cameras and enhanced security for the Hawai‘i State Hospital.
• $2 million for essential rural medical air transport
• $1 million in general funds for the in-community youth program services at the Hawaiʻi Youth Correctional facility to support youth mental health.

Preserving the ʻāina for generations to come

As one of the most ecologically diverse places in the world, Hawaiʻi serves a critical role in leading global environmental protection and ecological conservation efforts and policies.

Through the efforts of state agencies such as the Department of Land and Natural Resources, Department of Agriculture, Hawai‘i State Energy Office and Department of Transportation, as well as newly formed working groups such as the Governor’s Climate Action Team, the Green Administration is committed to comprehensive plans to reduce greenhouse gas emissions, transition energy infrastructure to renewable sources and invest in policies to combat and remove invasive species throughout the islands.

To further the state’s commitment to environmental conservation, the supplemental budget includes:

• $24.7 million for natural area reserves and watershed management.
• $21.3 million for ecosystem protection and restoration efforts.
• $20 million in state park special funds for state park administration and operations.
• $8.9 million for a native resources and fire protection program.
• 3 permanent brand managers and $3.7 million in general funds for regenerative tourism development and community enrichment program, including funding for the Kūkulu Ola program that provides funds to community-based awardees that enhance, strengthen and perpetuate Hawaiian culture through genuine experiences for residents and visitors.
• $3 million in general funds for geothermal energy exploration.

Educating keiki and investing in Hawaiʻi’s future

Educating the state’s keiki and ensuring that educators, classrooms and programs are adequately equipped and resourced is a major area of focus for the Green Administration.

Through negotiating fair deals with teachers to combat the state’s public school teacher shortage, developing teacher housing statewide and investing in programs for keiki, the governor’s comprehensive approach is supporting the state’s education system.

To further Hawaiʻi’s commitment to education, the supplemental budget includes:

• $20.9 million for summer learning hubs to ensure summer programming for keiki.
• $18.2 million for school bus contracts.
• $18 million for school food service program.
• $14.9 million in pay increases for educational assistants and vice principals.
• $6 million for weighted student formula for small and remote schools.
• $5 million of funding school security and active threat response training for public schools.
• $5 million for mobile applications to mitigate threat-based safety risks.
• $3.7 million to continue the Hawaiʻi Promise scholarship program for the community colleges system to cover last-dollar education costs, including tuition, fees, books and other supplies.
• $3.6 million for work-based learning for students with severe disabilities.
• $3.2 million for UH-Mānoa women’s sports, to include travel, visiting team guarantees, meals, recruiting and supplies.
• $2.8 million for statewide access master plans for the community colleges.
• $1.3 million in general funds for the Hawaiʻi Keiki Healthy and Ready to Learn Program, which provides access to school nursing services in public schools.
• $1.3 million for special education and student support services, including speech-language pathology services.
• $1.2 million for staff, equipment, training and supplies to comply with Act 76, SLH 2023 which expands protections for victims of sexual and domestic violence in the University of Hawaiʻi System.
• $1 million for instructors, technicians and other staff to expand the nursing programs at UH-Mānoa and UH-West Oʻahu.
• $925,000 for the UH John A. Burns School of Medicine’s Neighbor Island Health Access and Pathway Extension to expand access to health care for underserved communities.

Healing and resilience for Maui

In August 2023, one of the worst natural disasters to ever strike the state as wildfires destroyed Lahaina and other portions of Maui, killing more than 100 people. During the past year, the Green Administration led a comprehensive disaster response, which shifted into the recovery and rebuilding.

Through building temporary housing for survivors, creating the One ʻOhana Fund for victims and their families, investing in public infrastructure in affected communities and funding measures to mitigate and prevent future wildfire risk, the state is committed to long-term recovery efforts.

The supplemental budget contains:

• More than $200 million in general fund appropriations that will be deposited into the Major Disaster Fund to support Maui recovery efforts, including those prioritized by the Legislature this session.

Reductions and vetoes

Also included in the fiscal year 2024 supplemental budget were line-item reductions and vetoes totaling $74.2 million for the operating budget and $79.5 million for the capital improvement projects budget, representing less than 1% of the total budget.

Those reductions are part of a larger plan that reduced other appropriation bills to re-balance the state’s finances and maintain stable reserves. These items were identified because they have other sources of funding available or were not feasible given funding timelines and department capacity.

Last year, the governor issued line-item budget reductions and adjustments totaling $1 billion dollars. This year, Green issued more than $500 million in adjustments to balance the financial plan and ensure a strong carryover balance while maintaining a $1.5 billion rainy day fund.