Key lawmakers in the state House and Senate are making some major changes to Gov. David Ige’s plan to spend $100 million in energy efficiency funds to cool 1,000 public school classrooms, and warn that installing that much air-conditioning and other equipment may take longer than Ige has proposed.
In his State of the State address last month, Ige called for the state to use $100 million in Green Energy Market Securitization funds to quickly install energy-efficiency equipment and air conditioners in the classrooms by the end of 2016.
Earlier this month, Ige urged lawmakers to rush a bill through the Legislature by Monday, authorizing the use of the GEMS funds for the school air-conditioning initiative. But it is now clear that lawmakers won’t meet that deadline.
Senate Ways and Means Chairwoman Jill Tokuda and House Finance Chairwoman Sylvia Luke said Wednesday they agree the state must push ahead with plans to cool its public school classrooms, but Tokuda said she doesn’t plan to use GEMS money for the effort.
Instead, she wants to use part of a $170 million reimbursement for fiscal years 2014 and 2015 from the federal government that is owed to the state in connection with Medicaid. That is money the state has already received or expects to receive for Medicaid, which is funded by the state and federal governments to provide health care for low-income and disabled people.
Lawmakers said that federal reimbursement money will be deposited in the state’s general treasury but was not included in Ige’s proposed budget for the coming fiscal year, and is available to pay for the school air-conditioning initiative.
Tokuda (D, Kailua- Kaneohe) said she is willing to provide the full $100 million Ige is seeking, but Luke expressed doubts that the state Department of Education is prepared to move ahead as rapidly as Ige would like with the air-conditioning and other classroom improvements. Luke is unwilling to commit to providing $100 million just yet.
“NUMBER one, we want to make sure that DOE does it properly and efficiently,” said Luke (D, Punchbowl-Pauoa-Nuuanu). She said she wants to see “a good plan” with more specifics about how the DOE will prioritize the work and complete the projects.
As for Ige’s end-of-year goal, “I don’t know how that’s even possible” no matter how much money the state commits to the effort, Luke said. “The bottom line for something like this is we are investing a lot of money. We might as well do it right, as opposed to doing (it) for the sake of meeting some deadline.”
Both Luke and Tokuda say they are uncomfortable using the GEMS funding for the air-conditioning effort because that is not what the GEMS program was created to do.
GEMS is a low-interest loan program created by the state to loan money to Hawaii nonprofit organizations, homeowners and renters to pay for solar-power systems and other clean-energy systems.
The program issued $150 million in bonds to raise money to finance installation of energy-saving equipment, and the bonds are being repaid with money raised through a fee on consumers’ utility bills on Oahu, Maui and Hawaii island.
If the state were to borrow the GEMS money to finance the school cooling projects, it would have to pay interest on those funds, which would increase the cost of the effort, Tokuda said. She said it will be cheaper and simpler to use the Medicaid reimbursement cash instead of borrowing GEMS funds.
“As a policy, we should definitely try to consider what was the nexus, why did we create this fund? And we should be true to it,” she said of the GEMS program.
Ige’s chief of staff, Mike McCartney, said the proposal to use the Medicaid reimbursement money for the cool-the-schools initiative is “a good idea, we should look at that.”
THE administration also understands it needs to map out an execution plan that spells out in greater detail how the school system will actually complete the work that needs to be done, and that is being put together, McCartney said.
McCartney said it appears about $80 million of the Medicaid reimbursement money may be available for the school initiative, and Department of Human Services Director Rachael Wong said using that money for the school air- conditioning effort would not harm the Medicaid program.
“We’re open to this because there’s multiple ways to get to making sure we cool the classrooms,” McCartney said. “That’s the main thing.”
