Hawaii’s biggest construction labor union is embroiled in a fight with the state’s largest electrical utility and a union representing over 1,000 of its employees.
The Hawaii Regional Council of Carpenters announced Thursday that it launched a public awareness campaign in part to replace leaders of Hawaiian Electric and build opposition to a bill pending at the Legislature that originally intended to establish a $1 billion fund to pay for damage from potential future catastrophic wildfires for which a regulated utility is liable.
The union describes House Bill 982 as a bailout for the utility company paid for by customers.
“We’re raising the alarm because no one else is,” Ronald Taketa, the union’s executive secretary and treasurer, said in a statement.
“While HECO’s top executives collect massive paychecks and bonuses — even after losing $1.4 billion — Hawaii residents are being asked to pay more for less accountability,” he said. “This isn’t just bad policy — it’s corporate greed in action, and it must be stopped. … This fight is about fairness, accountability, and standing up for the people.”
Hawaiian Electric claims that the carpenters union is railing against the company and the bill, which last week was amended to only study provisions of the proposed Wildfire Recovery Fund, in retaliation for the company refusing to sign a labor agreement with the union.
“Let’s be clear — this campaign by the Carpenters has nothing to do with the cost of living or legislation or accountability or what executives get paid,” the utility company said in a statement. “This is payback because we wouldn’t sign a 20-year Project Labor Agreement with the Carpenters — they warned us this is what would happen if we didn’t go along.”
‘Bully-tactics’
The International Brotherhood of Electrical Workers Local 1260, which represents about 1,200 Hawaiian Electric employees, accused the carpenters union of using “bully-tactics” to extort the utility for the labor agreement.
“Holding Hawaiian Electric hostage in its efforts to stabilize operations and minimize costs to ratepayers, the Carpenters demanded that HECO sign an agreement that would have excluded the other seventeen Hawaii building and construction trades unions and their members from work on future HECO projects,” IBEW 1260 said in a statement.
Leroy Chincio Jr., IBEW 1260 business manager and financial secretary, described the beef as a “dark day” for Hawaii labor unions.
“They basically wanted all or nothing,” he said in an interview, referencing the carpenters union. “That’s totally against everything that organized labor stands for.”
Taketa said the proposed labor agreement applied to construction traditionally performed by union carpenters and not work performed by IBEW members.
For a March 20 hearing on HB 982, eight local construction industry unions in addition to IBEW testified in support of the bill along with the Hawaii Fire Fighters Association Local 1463 AFL-CIO. About a dozen other organizations, including the Kaua‘i Island Utility Cooperative and the Chamber of Commerce Hawaii, also endorsed the bill along with numerous individuals.
Opponents of the bill that testified at the same hearing were the carpenters union, the Hawaii Association for Justice, the National Association of Mutual Insurance Companies and one individual.
As part of its multimedia campaign, the carpenters union wants Hawaiian Electric leadership replaced, urges the public to testify against HB 982, established the website nohecobailout.com and commissioned a March 5-10 public opinion poll from Strategies 360 Research about the bill.
Bill opposition
According to Strategies 360, 75% of 500 registered voters who participated in the poll opposed the bill based on a short description, and opposition increased to 82% after further description.
Hawaiian Electric called the poll a “push poll” designed to yield desired opposition.
On the campaign’s website, the carpenters union said the original version of the bill would allow a utility to pass the financial fallout of wildfire damages on to ratepayers even if company negligence contributed to such a disaster.
Hawaiian Electric said if a utility were found negligent, then company shareholders would be on the hook to replenish the fund up to about $350 million.
The carpenters union also claims that the original bill would lock in higher utility rates for years and allow Hawaiian Electric to recover $1 billion through charges on customers’ electrical bills.
Hawaiian Electric said a bond would be issued to establish a $1 billion recovery fund for future wildfires, with customers paying about $4 a month for bond interest, and that the Legislature could refund some or all of the customer payments in 10 years if fire risk is reduced and there are no catastrophic fires.
According to the state Department of the Attorney General, the original version of HB 982 “attempts to address the risk of catastrophic wildfires by providing an efficient, low-cost process for property owners, renters, businesses, and their insurers to obtain compensation for the damage resulting from a catastrophic wildfire that a regulated utility is alleged to have caused or contributed to, while limiting the liability of the regulated utility to protect its financial health.”
The governor’s office said in written testimony that it appreciates the intent of the bill, but suggested that more funding come from stockholders in Hawaiian Electric’s parent company while less funding come from ratepayers.
In response, a House committee on Feb. 5 amended the bill to require that shareholders and ratepayers each finance about half of the $1 billion fund.
The latest change was made March 20 by two House committees so that the bill would instead convene a working group within the state Department of Commerce and Consumer Affairs to analyze provisions of Wildfire Recovery Fund proposals considered this year by the Legislature.
The carpenters union said the bill was rushed without sufficient public awareness or input and that it is concerned the bill could be amended again to its original purpose and become law.
The union said its multimedia campaign will continue beyond the end of this legislative session to serve as “public watchdog on HECO’s actions.”
HB 982 would not affect a pending $4 billion settlement over the August 2023 Maui wildfire disaster. Hawaiian Electric agreed to pay $2 billion of this obligation as compensation to victims of the fire that killed 102 people and destroyed most of Lahaina.
Hawaiian Electric has said ratepayers will not pay more for electricity because of the $2 billion outlay to be paid over four years. So far, the company has funded an initial installment by selling new stock in its parent, Hawaiian Electric Industries Inc.
HEI recorded the total $2 billion expense on its financial books in 2024, and after accounting for other operations and tax impacts, the company’s net loss was $1.43 billion.
Despite the loss, top HEI and Hawaiian Electric executives received bigger compensation packages, which include base pay, bonuses, stock awards, deferred compensation, pension value and other things.
For instance, total compensation for HEI President and CEO Scott Seu rose to $6.5 million from $5.4 million in 2023 and $3.8 million in 2022.
Shelee Kimura, Hawaiian Electric president and CEO, earned $2.6 million in total compensation in 2024, up from $2.1 million in 2023 and $1.5 million in 2022.
The company said Friday that Seu and Kimura decided to forgo increased pay for 2024.
