The economic impacts of the coronavirus pandemic have been blunted by temporary shields. Evictions have been held off by a moratorium, and income lost in a wave of joblessness has been offset by unemployment benefits fattened with a federal supplement.
Those cushions have been removed at the most inopportune moment, just when the islands are in the midst of an infection surge. The worst of it is being felt on Oahu, where daily case counts topping the 1,000 mark are becoming routine.
How to make optimal use of available federal aid — and finding ways to support the local economy through the current crisis — must be the paramount concern. The City and County of Honolulu in particular faces a steep challenge, and has taken an encouraging step in the update to its recovery plan released last week.
The plan, which must be approved by the City Council, is a blueprint for spending about $386 million in federal COVID-19 relief funds that remain from the American Rescue Plan Act (ARPA) allotment for Honolulu.
It is fortunate that this cache remains now, because of the dire straits in which the city finds itself.
On Aug. 26, the U.S. Supreme Court struck down the Biden administration’s extension of an evictions moratorium. Hawaii had a particularly high unemployment rate, peaking at 21.9% in spring 2020, setting many tenants back on their rent.
The stays on eviction were aimed at preventing an avalanche of renters suddenly crowding into homeless shelters and encampments in the midst of a pandemic. With infection counts spiking again, now would be a particularly bad time for that to happen.
Further, the rising concern about virus spread has put a chill on businesses just at a critical point. Tourism activity, which had rebounded robustly this summer, has settled into its seasonal decline.
Commerce dipped further with the arrival of COVID-19’s contagious delta variant, and with Gov. David Ige’s advisory against local and tourist travel. Residents who otherwise would be spending and moving about more freely have felt constrained out of fear of infection, whether or not they were vaccinated.
By May 2021, according to the ARPA plan document, unemployment had fallen to 8.1%, aided by the spring and summer rush of visitors. But recovery here still has lagged behind the national average.
This setback surely should prompt city officials to get more business grants out the door as a safety net during the difficult months ahead. There’s a fair start at that in the blueprint, with $20 million in funds aiding small businesses and nonprofits with grants, technical assistance and other resources.
Among the other major elements of the plan:
>> The largest allocation of funds is $110 million in the broad category of providing community support and addressing economic impacts. This includes programs for wrap-around services for the homeless and the city’s program for rent and utility assistance, which has delivered $58 million to 7,000 Oahu households since April.
After its last increment of 5,000 applications, the city portal (oneoahu.org/renthelp) has been put on pause to allow time for processing, but the ultimate plan is to deliver $180 million total to landlords and others owed housing payments.
>> Under the heading “support equitable economic recovery” is more than $156 million, covering key priorities such as affordable housing. Among the projects are $1.5 million to support landlords offering vacant units to the homeless or households at risk of homelessness, and $900,000 to assess properties for housing or temporary shelter use.
>> There are agricultural supports to help sustain farmers through assistance with processing, distribution and business education. This is important for food sustainability, given how the industry, which supplies restaurants and institutions such as schools, was shaken by the economic shutdown.
And retraining workers who want to reenter the job market on a different career path is another sound idea, considering the disruption to the workforce caused by the ongoing pandemic.
Many of these workers are still sidelined. More than 40,000 of them are supported by unemployment aid that may have run out for many, or is severely diminished now.
The last payable week for the Pandemic Emergency Unemployment Compensation (the weekly $300 “plus-up”) ended Saturday; so did the Pandemic Unemployment Assistance for the self-employed and others not eligible for standard benefits.
The economic desperation is real and sure to persist for some time. The basic framework of the plan makes sense, but the City Council does need to consider whether allocations are enough for pressing needs such as housing, especially with the homelessness fallout expected from evictions.
The next few months are sure to be rough for businesses and families, and recovery will take years to settle in. Honolulu must move swiftly to get its share of emergency aid to those in critical condition, so that economic healing can begin.
