Quantcast

Thursday, August 21, 2014         

ON POLITICS


 Print   Email   Comment | View 0 Comments   Most Popular   Save   Post   Retweet

Hurricane fund one of state's best political footballs

By Richard Borreca

POSTED:



This week marks the start of the 2011 hurricane season. Do you know where your Hawaii Hurricane Relief Fund is?

We spent it. Well, not all of it. But Hawaii's recession has forced the Abercrombie administration to chew through about half of it.

Immediately upon taking office, Abercrombie popped $67 million of the hurricane fund into restoring some of last year's furlough school days.

This wasn't much of a surprise except for the alacrity of the new governor's actions. The 2010 Legislature had already authorized the administration to dip into the fund and Abercrombie has promised during the campaign that he would take them up on the offer.

Then this year, a poor winter and anemic spring pointed to a tax collection shortage this year. To prevent that, Abercrombie asked lawmakers to again raid the hurricane fund. Just last week, he signed legislation allowing him to pull out another $42 million, or as much as was needed.

The fund totaled about $180 million and the state was already siphoning away the yearly interest of about $7.5 million. So the fund could now be down to around $70 million, which is the bare minimum fund managers said would be needed to restart it if a devastating hurricane hits.

Of course it is absolutely not encouraging to note that the Weather Channel lists Honolulu as the No. 1 city overdue for a hurricane. Just the sort of bachi we don't need.

The fund's acting executive director, Lloyd Lim, told the Legislature not to listen to Abercrombie, saying if we are slammed with a storm, "there is substantial uncertainty with respect to the risk that the HHRF will face and the cost of reinsurance in the then existing market."

The fund was started 18 years ago after Hurricane Iniki caused more than $1.6 billion in damage to Kauai and Oahu. The private home insurers bailed on Hawaii and people could not get the hurricane insurance required by their mortgage holders. So for about eight years, the state charged policy holders, assessed property and casualty insurers and took some of the mortgage insurance fees to create the hurricane relief fund and provide hurricane insurance.

Slowly the private insurers came back to the Hawaii market and in 2002 the fund was put on hold.

"When we closed it, we never realized the fund would have so much left in it, we thought it would be just pennies," says former state Senate President Robert Bunda, who was one of the hurricane fund founders.

Since then, the fund has become one of the state's best political footballs. Gov. Linda Lingle started office by vowing never to touch the fund, but by her last year in office was forced to sign the bill allowing money to go to end the furloughs. Legislators signed a letter pledging never, never, ever to touch the fund, but that was before the state budget slump became the state budget crisis.

"If you ask me now, I'd say use it to balance the budget and not take more skin off people's back," says Bunda.

Former Gov. Ben Cayetano wanted to use it for education, Lingle said it was needed to assure bond rating agencies that we had adequate savings, and now it is being drained.

Even Lim noted in a letter to the editor earlier this year that the fund will be needed "only if a hurricane strikes and an inadequate amount of private insurance is available."

Let the hurricane gods keep smiling on Hawaii.

———

Richard Borreca writes on politics on Sundays, Tuesdays and Fridays. Reach him at rborreca@staradvertiser.com.






 Print   Email   Comment | View 0 Comments   Most Popular   Save   Post   Retweet

COMMENTS
(0)
You must be subscribed to participate in discussions


IN OTHER NEWS
Latest News/Updates
Blogs
Political Radar
Proceeding

The Green Leaf
Expanding a monument

Wassup Wit Dat!
Huh? – Follow Up

Political Radar
Spirit of Daniel Inouye

Small Talk
Lady bag

Political Radar
Six days

Political Radar
Thanks

Wassup Wit Dat!
Huh?