Gov. Green issues intent to veto 17 bills including legislation for wildfire recovery saying it inadvertently zeroes out funding for affordable housing

Gov. Josh Green, M.D., notified legislative leaders and stakeholders of his intent to veto 17 bills passed by the Hawaiʻi State Legislature during the 2024 session.  

While Green is not required to veto every bill on the Intent-to-Veto list, he cannot veto any bill that is not on the list. The governor has until July 10 to issue final vetoes and all remaining bills will become law by July 10. 

“This veto list reflects our need to prioritize Hawaiʻi’s crippling high cost of living, the state’s affordable housing crisis and Hawaiʻi’s families impacted by the Maui wildfires,” said Green. “In doing so, I intend to veto, line-item veto, or make appropriation reductions on several bills in order to maintain a balanced budget, but more importantly, to achieve a healthy carryover balance of more than $300 million at the end of next fiscal year. After enacting the largest income tax break in our state’s history, strategic decisions were necessary to ensure we had a balanced budget.”

“In addition to fiscal considerations, my decisions are based on legal concerns, improving government operations, and avoiding negative impacts on the public and Hawaiʻi residents,” the governor said.

The following bills noted below are being considered for veto, line-item veto, or reductions to sustain the state’s fiscal health.

HB40: RELATING TO THE GENERAL FUND

Bill Description: Appropriates funds to be deposited into the emergency and budget reserve fund and pension accumulation fund pursuant to article VII, section 6, of the Hawaiʻi State Constitution.

Veto Rationale: Given the Maui wildfire recovery efforts and other state priorities such as affordable housing and reducing the cost-of-living for our residents, it would be financially imprudent to transfer $300 million in general fund money to the emergency budget reserve fund (Rainy Day fund) and to deposit an extra $135 million into the pension accumulation fund. The current balance of the Rainy Day fund of more than $1.5 billion is the largest it has ever been, and the state is committed to making regular payments on its unfunded liabilities including its pension obligations.

SUPPLEMENTAL APPROPRIATIONS ACT OF 2024

SB3068: MAKING APPROPRIATIONS FOR WILDFIRE RECOVERY.

Bill Description: Appropriates funds to support the state’s continued response to the August 2023 wildfires that affected the counties of Hawaiʻi and Maui. Declares that the appropriation exceeds the state general fund expenditure ceiling for fiscal year 2024-2025. 

Veto Rationale: While the bill appropriates necessary funds to assist with Maui wildfire recovery, the bill inadvertently zeroes out funding for affordable housing. This bill, if enacted, would delay the construction of affordable housing units for Hawaiʻi’s residents. Alongside recovery efforts, housing remains a key priority for the Green Administration, and the administration will fully support all appropriations in this bill by transferring funds to the major disaster fund. The Budget Bill has sufficient appropriations to support all the wildfire recovery efforts detailed in this bill and the funds will be redirected to fund Maui recovery needs upon signing the Budget Bill.

HB1800: RELATING TO THE STATE BUDGET

Bill Description: Adjusts and requests appropriations for fiscal biennium 2023-2025 funding requirements for operations and capital improvement projects of Executive Branch agencies and programs.

Veto Rationale: Fiscal prudence requires us to reassess our priorities to ensure we are addressing our highest needs—and all our needs—in an appropriate manner. Given recent projections by the Hawai‘i Council on Revenues, specific and targeted line-item amendments to the budget based on feasibility, priority, and departmental capacity are required to maintain a prudent financial plan, preserve our base budget, and balance the state’s most essential needs.

HB2619: RELATING TO AGRICULTURAL BIOSECURITY

Bill Description: Requires the Department of Agriculture (DOA) to lead and coordinate the state’s invasive pest control and eradication biosecurity efforts. Establishes certain reporting requirements. Appropriates funds to the Department of Agriculture for programs and positions in agricultural biosecurity. Appropriates funds to each county as a grant-in-aid, subject to a county match, for the implementation of feral chicken control programs.

Veto Rationale: The governor strongly supports the intent of this legislation and continues to work with the DOA on invasive pest control and eradication biosecurity efforts. Part of this ongoing effort is to determine the appropriate level of funding that is feasible and executable by the DOA. With existing challenges to staffing vacancies and existing appropriations for biosecurity, the dollar amount in this bill will be assessed to ensure effective impact of funds for biosecurity.

SB3153: RELATING TO THE DAM AND APPURTENANCE IMPROVEMENT OR REMOVAL GRANT PROGRAM.

Bill Description: Establishes the Dam and Appurtenance Improvement or Removal Grant Program Special Fund to receive moneys for the Dam and Appurtenance Improvement or Removal Grant Program. Appropriates funds into and out of the Special Fund for the Dam and Appurtenance Improvement or Removal Grant Program.

Veto Rationale: Reducing the risk of dam failure requires rigid enforcement of dam safety standards. A robust framework for the management of dam and appurtenance improvements and removals requires careful consideration of a potential program’s long-term cost. The administration is evaluating the financial viability of this program as it supports private dam owners with their state compliance efforts.

The following bills are being considered for veto based more on policy reasons than fiscal ones.

HB1633: RELATING TO CONTRACTORS

Bill description: Repeals the leasing restriction on owner-builders who obtain an owner-builder exemption to act as their own contractor and who build or improve residential or farm buildings or structures on property they own or lease and do not offer the buildings or structures for sale.

Veto Rationale: Construction projects must maintain quality and safety standards, which is why licensed contractors are generally required. This bill would lift restrictions on owner-builders and create a broader exemption so that unlicensed contractors could be used for rental projects. There are concerns about how increased unlicensed activity would affect consumers. The bill also removes the requirement that structures be built for personal use, which increases the possibility such structures are built for other purposes such as short-term rentals. 

HB1640: RELATING TO COLLECTIVE BARGAINING

Bill Description: Requires the employer to initiate negotiations on the repricing of classes within a bargaining unit within 30 days of its receipt of the exclusive representative’s written request to negotiate. Establishes that an impasse exists and impasse procedures shall apply if an employer fails to initiate the negotiation within the required time frame and the parties fail to reach an agreement within 150 days of the exclusive representative’s written request to negotiate, or by January 31 of a year in which the collective bargaining agreement is due to expire, whichever is earlier.  Sunsets 6/30/2029.

Veto Rationale: This bill would greatly impact the state’s and counties’ ability to uphold an objective, equitable pay system and would place undue stress on chronically understaffed human resources teams across state and county governments. Existing law already provides for negotiations to reprice classes during master collective bargaining agreement negotiations. 

HB1763: RELATING TO HOUSING

Bill Description: Prohibits the Hawaiʻi Housing Finance & Development Corporation (HHFDC) from forgiving any loan made from the Rental Housing Revolving Fund (RHRF) unless the Corporation forecloses on the project. Amends the permitted uses of and priority for which moneys in the RHRF are to be used. Repeals the authorization to use RHRF to provide grants. Requires the HHFDC to submit a report to the Legislature on plans to revolve funds back into the RHRF. Applies to RHRF applications submitted after 6/30/2024. 

Veto Rationale: The RHRF is a critical tool for financing the development, construction, acquisition, preservation, and substantial rehabilitation of rental housing units for affordable housing. However, there are unresolved concerns regarding the impact of this legislation on affordable housing construction. Proposed amendments to permitted uses of the RHRF could impact the ability of financed projects to self-finance any necessary improvements in the future.  

HB1936: RELATING TO HARBOR SAFETY

Bill Description: Mandates that the Department of Transportation require the securing of mooring lines from vessels to commercial docks, wharves, piers, quays, and landings to be performed by labor subject to collective bargaining. Sunsets 7/1/2028. 

Veto Rationale: This legislation could increase shipping costs across Hawai‘i for transported goods, which could be passed onto consumers. Given that Hawaiʻi already has a high cost of living, this bill will further increase costs and place an undue burden on Hawaiʻi’s economically stressed residents.

HB2359: RELATING TO THE HAWAIʻI BROADBAND AND DIGITAL EQUITY OFFICE

Bill Description: Establishes the Digital Equity Grant Program to award grants to applicants to deploy digital equity projects to covered populations in the state.

Veto Rationale: While the State Digital Equity Plan is a roadmap for achieving a digital equity baseline across the islands, this bill would inhibit the development of small-scale, community-based networks in historically disadvantaged communities in Hawai‘i. As a matter of fairness, providers, regardless of size, should be permitted to participate in the Digital Equity Grant Program. 

HB2526: RELATING TO MOTOR VEHICLES

Bill Description: Increases the penalty for a third or subsequent offense involving the unauthorized driving or operation of motor vehicles to a class C felony. Authorizes the court, as part of the person’s sentencing for the third or subsequent offense, to order that the vehicle used by the person in the commission of the offense be subject to forfeiture. Takes effect 7/1/2024.

Veto Rationale: This bill will increase the caseloads for prosecutors, law enforcement, the Judiciary, the Office of the Public Defender, and the Department of Corrections and Rehabilitation without providing additional funding for enforcement. Implementation costs pose a feasibility issue with enacting this bill. 

HB2581: RELATING TO EMERGENCY MANAGEMENT

Bill Description: Removes the ability of the governor or a mayor to suspend electronic media transmission during a state of emergency or local state of emergency, respectively.

Veto Rationale: The governor is a strong proponent of the First Amendment, and understands that during an emergency, communication must be timely, accurate, and well-coordinated. However, we must still guard against acts of extreme violence or acts of terrorism which can use social media or other electronic media to communicate and activate crowds or destructive devices. This power to suspend electronic media transmissions is subject to federal law and the governor and the mayors of every county in the state of Hawai‘i carefully weigh the power to suspend electronic media transmissions. As this bill has had prior versions last session with alternative language that more properly balances the needs for communication balanced against the need for protection, the governor would prefer that a bill be worked on again looking at that more balanced approach.

SB572: RELATING TO AGRICULTURE

Bill description: Authorizes and specifies conditions under which the Department of Agriculture may declare a biosecurity emergency, during which the Department and governor may take certain actions to prevent the establishment or spread of pests and prohibited or restricted organisms. Broadens the objectives and general actions of the Biosecurity Program.

Veto Rationale: Unlike the majority of the United States, the overwhelming majority of Hawaiʻi’s commercial goods move through the state’s harbors. Such goods include consumer goods, motor vehicles, construction materials, and fuel. Select sections of this legislation may impede harbor operations and the timely movement of those commercial goods transported through our ports. In effect, the power to requisition ships, as provided in this legislation, will unnecessarily impact the flow of goods that our communities rely on and appears to be an extreme power that could be addressed in a more methodical and limited approach.

SB1511: RELATING TO THE RESEARCH CORPORATION OF THE UNIVERSITY OF HAWAII. 

Bill Description: Clarifies the purpose of the Research Corporation of the University of Hawaiʻi (RCUH) and that its undertakings shall be limited to acts that are reasonably necessary to carry out its purpose. Repeals the requirement that the University of Hawaiʻi contract with the RCUH when the University determines that other various agencies cannot more effectively or efficiently accomplish certain research and training activities. Grandfathers existing RCUH contracts and requires new contracts be subject to new limitations. Limits the scope of the special account the RCUH is authorized to establish. Requires revolving accounts to follow University of Hawaiʻi Administrative Procedure 12.204. Limits internal service orders and revolving accounts of the RCUH that use University intramural funds to certain projects and requires biannual reports to the Legislature.

Veto Rationale: In response to Senate Resolution No. 148, Senate Draft 1, of the 2021 Legislative Session, the University of Hawai‘i convened a task force to address the issues outlined in this legislation. This bill is, therefore, not necessary, and will only create confusion about both the role of the RCUH and the University of Hawaiʻi’s ability to foster innovative research opportunities through RCUH, which amount to more than  $300 million in the last year alone, with benefits to the state’s economy and communities.

SB2439: RELATING TO LIMITATION OF ACTIONS 

Bill Description: Extends the statute of limitations for civil actions brought by persons subjected to sexual offenses as an adult against the person who committed the act. Allows a claim to be brought against legal entities during the two-year window period if there is a finding of gross negligence. Authorizes a court to award attorney’s fees to a defendant when an accusation of sexual abuse was made with no basis in fact and with malicious intent.

Veto Rationale: Unlike Senate Bill No. 2601, which extends the period of time in which a child victim of abuse may bring a civil suit, this bill extends the time that an adult victim can bring a claim. This bill goes back and provides another limited window for adults to pursue a claim, but in approaches and time limits that do not appear to have any clear or prudent basis. There is also a concern about record retention policies that enable the destruction of potential evidence after set time periods. The potential revival of claims muddles the statute of limitations as a standard in the eyes of businesses and nonprofit organizations when it comes to record retention. Financial implications, insurance coverage, and document retention decisions must be properly factored into future legislation. 

SB2512: RELATING TO EMERGENCY MANAGEMENT POWERS 

Bill Description: Establishes notice and reporting requirements for the expenditure or use of public resources by the governor, pursuant to the governor’s emergency powers.

Veto Rationale: In times of emergency, the governor needs the flexibility and support to rapidly execute on key decisions on matters involving the public’s safety. Notice and reporting requirements mandated in this bill impede the governor’s responsiveness and the Department of Defense’s flexibility during states of emergency and disaster situations, which impact the state of Hawaiʻi’s ability to provide support for impacted residents. Furthermore, the administrative procedures that necessarily follow such notice and reporting requirements will delay the governor’s decision-making authority, and potentially the ability to respond in times of emergency. 

SB2557: RELATING TO LEGAL REPRESENTATION 

Bill Description: Allows a court to appoint an attorney for the subject of a petition for assisted community treatment if the interests of justice require one be appointed. Repeals language that entitles the subject of a petition for assisted community treatment to legal representation by a public defender.

Veto Rationale: This legislation is nearly identical to language in parts of another bill that passed the legislature this session, House Bill No. 2159. And while the governor supports the purpose of this bill, it is nearly duplicative and unnecessary.