Governor Abercrombie Signs Unemployment Insurance Bill Into Law

Today, Governor Neil Abercrombie signed House Bill 2096, which extends the mitigation of the Unemployment Insurance tax increase through calendar year 2012, into law.

This is the sixth measure the Governor has enacted into law this legislative session and comes at a pivotal time as the state's economy continues its slow recovery. The legislation allows local businesses to save hundreds of dollars per employee annually in Unemployment Insurance tax contributions. These savings may make the difference between staying in business or not, allowing companies to hire additional employees, and preventing businesses from laying off current employees.

The bill also continues the Maximum Weekly Benefit Amount at 75 percent of the Average Weekly Wage rather than return to the normal 70 percent. The legislation also permits the Unemployment Insurance Fund to accept loans from the state general fund and the federal government, if necessary.

Governor Abercrombie signing House Bill 2096 into law.

Rep Rhoads' prostitution bill signed into law

HB44, a bill that makes it a misdemeanor to offer or agree to pay a fee to another person for the purpose of sexual conduct within 750 feet of a school or public park, was signed into law on June 1, 2011 by Governor Abercrombie. The bill, which was introduced by Rep. Karl Rhoads (District 28 – Downtown, Chinatown) is now Act 74 and takes effect on July 1, 2011.

"Children and their parents, going to and from school or the park, should not be exposed to a gauntlet of prostitutes, pimps and johns," said Rep. Rhoads. "HB 44 raises the penalty for johns, and subsequently helps to clear out prostitution in areas where children must travel. The Governor's signing of this bill is a strong message that the public has a right to use public thoroughfares without being intimidated by illegal activity."

Art at the Capitol 2011: What's on your wall, Rep. Karl Rhoads?

Join us April 1, 2011, from 5-7 p.m. for Art at the Capitol 2011. View over 460 works of Art from the State Foundation on Culture and the Arts' "Art in Public Places Program."

Class of 2006

Left to right: Representatives Joey Manahan, Angus McKelvey, Karen Awana, Karl Rhoads, Sharon Har, James Kunane Tokioka, John Mizuno. (courtesy Rep. Mizuno)

Will Hawaii Learn the Great Recession?

Rep. Karl Rhoads's editorial on Civil Beat: Will Hawaii Learn the Great Recession?

Pray for Sun

Map: The Honolulu Advertiser

Rep. Karl Rhoads (District 28 - Palama, Chinatown, Downtown, Lower Makiki, Sheridan) recently completed a survey of Mayor Wright Home residents on the availabiity of hot water in their public housing units. He was surprised on two fronts. One is that even after being the district representative since 2006, he had never heard complaints about the lack of hot water until recently. Two is that the lack of hot water is so wide spread and has existed for so long that people have given up complaining to the building manager.

The Honolulu Star-Advertiser published a story last week.

The survey reveals the extent of the problem and the common thread - when it's sunny there is more hot water, and when it rains or is cloudy, there is less to none. That's because the project depends solely on an older solar panel system. The back-up system, which should kick in when there isn't enough sun to generate hot water, broke down years ago and was never fixed.

I got a copy of the survey - these are my calculations. There were 117 units approached.

9.4% or 11/117 said they never have hot water, warm water at best.

22.2% or 26/117 were not home or didn't answer.

21.3% or 25/117 said they had hot water.

47% or 55/117 said they had some hot water, but not all the time.

Rep. Rhoads says he willing to fight for more money at the legislature for repairing the hot water system at Mayor Wright. However, he needs cost estimates from the housing authority and is frustrated that there appears to be no plan to address the problem which has persisted for years.

Labor Committees Discuss Fatal Industrial Accident

Rep. Karl Rhoads and Senator Dwight Takamine, respective Labor Committee chairs, lead the discussion with the Department of Labor.

The House and Senate Labor Committees today heard testimony from the Department of Labor and the Hawaii Laborers' Union on the handling of an industrial accident which occurred on May 16, 2009. The victim was crushed by a collapsed tower and died.

After the department's investigation, the employer was fined $750 prompting an outcry from the family of the deceased and the laborers' union. Prior to the briefing, the committees asked the deparment to respond to the following question:

Q: Please describe the criteria used and justification for the amount of the fines in this case.

The department responded in part:

A: ...Section 396-10(b), Hawaii Revised Statutues, provides the Director with the statutory authority to proposed civil penalties for violations of Chapter 396. Any employer who has received a citation for an alleged violation of the Law which is determined to be of a serious nature shall be assessed a civil penalty of up to $7,000 for each violation.

Section 396-10(j), HRS, provides that penalties shall be assessed on the basis of four factors: 1)The gravity of the violation; 2)The size of the business; 3) The good faith of the employer, and 4) The employer's history of previous violations.

The gravity of the violation is the primary consideration in determining penalty amounts...

In this case, the gravity of the violation was determined to be "high severity", which is "death from injury or illness, injuries involving permanent disability, or chronic, irreversible illnesses."

...In this case, the probability of the violation was determined to be "lesser probability." This determination was based on the following facts: the employer had work rules, provided safety training, had emergency evacuation procedures that were known to their workers, and the decedent was able to escape the area but for unknown reasons went back into the tower area.

Pursuant to the FOM (field operations manual) a serious violation with a high severity and lesser probability has a gravity based penalty (GBP) of $2,500. The GBP may be reduced by as much as 95 percent depending upon the employer's "good faith", "size business," and "history of previous violations."

In this case, pursuant to the FOM, no discount was made based on "good faith" since there was a fatality. A mandatory sixty percent discount, pursuant to the FOM, was made based on "size of business" since the employer had between 1 and 25 employees. also, a mandatory ten percent discount based on "history of previous violations" was made pursuant to the FOM, since the employer had no serious violations from HIOSH during the last 36 months preceding the date of the accident.

Therefore, a total of seventy percent discount was applied to the GBP of $2,500, resulting in the proposed adjusted penalty amount of $750. These are the penalty amounts and adjustment factors contained int he HIOSH FOM and the federal OSHA FOM.

Note: Rep. Rhoads continued to be troubled by the fact that the worker went back into the tower area after all of the construction crew heard a "pop" sound and were instructed to evacuate. The crew was bi-lingual (English, Spanish) and the consensus was that everyone understood the instructions. There was also concern that the amount of the penalty, $750, was not enough to incent employers to create a safer work place in the future.

Joint Labor Committees to question Department of Labor

WHAT: The House Committee on Labor & Public Employment and the Senate Committee on Labor will hold a joint informational briefing on two subjects pertaining to the State Department of Labor:

Photo of Juan Navarro: Honolulu Star-Bulletin courtesy of Sandra Navarro

1. In May 2009, Juan Navarro, a construction worker, was killed by the collapse of a Hawaiian Cement tower at Campbell Industrial Park. Numerous questions have been raised over the department’s investigation by the Hawaii Occupational Safety and Health Division. News story on accident here. Union asks Legislature to follow up here.

2. Due to the current economic downturn, the state’s unemployment insurance fund was considered in jeopardy of depletion without the aid of federal assistance funds. The Department has decided to forego its efforts to obtain the federal funds. Lawmakers will ask why the decision was made and what is the status of the unemployment fund.

WHEN: Monday, June 7, 2010 – 10:00 a.m.

WHERE: State Capitol, Conference Room 329

UI bill heads to Governor for signature

A bill that will help businesses with anticipated soaring unemployment insurance (UI) rates has cleared the Hawaii State Senate today and is now headed to the Governor to be signed into law. HB2169, HD2, introduced by Rep. Karl Rhoads (pictured at left), will provide significant tax relief for employers while maintaining unemployment benefits for those who have been laid off through no fault of their own.

“I am very pleased that the Senate approved my bill, HB 2169, lowering unemployment insurance tax rates,” said Rep. Rhoads, Chair of the House Labor and Public Employment Committee. “HB 2169 is now on its way to the Governor, and I hope she will sign it by March 12. Her prompt signature would allow the Department of Labor and Industrial Relations to include the new lower rates in employers’ first quarter statements.”

The bill sets new lower rates for the next two years. Without the legislation, unemployment rates are scheduled to increase dramatically due to the struggling economy and high state unemployment. As a result, on average, an employer would now pay, per employee, $630 instead of $1070 in the first year, and $970 instead of $1520 in the second year.

Specifically, the bill does the following:

· Sets, for calendar years 2010 and 2011, the wage base at 90% of the average annual wage.

· Sets, for calendar year 2010, the employer contribution rate at schedule D and for calendar year 2011, the employer contribution rate at schedule F.

· Retains the maximum weekly benefit rate at 75% of the average weekly wage until December 31, 2011.

· Returns the maximum weekly benefit rate to 70% of the average weekly wage on January 1, 2012.

· Authorizes special assessments upon employers to pay the principal and interest costs on loans received from the U.S. Secretary of Labor provided that the director of Labor and Industrial Relations develops a fair and equitable manner in which these payments are made.

· Mandates recalculation of the adequate reserve fund beginning in 2012.


“Lowering unemployment insurance rates was the highest priority of the Chamber of Commerce of Hawaii for this Legislative session,” added Rep. Rhoads. “Both the House and the Senate fast-tracked this important legislation. HB 2169 will defer $241 million in UI taxes over the next two years. This is an important piece of good news to the business community during these difficult economic times.”

Free tax filing help at the Capitol, Feb 27

On Saturday February 27, 2010, from 9 am to 2 pm, IRS-certified volunteers take over Conference Room 329 of the State Capitol to assist taxpayers in filing their annual tax returns. In partnership with the Hawaii Alliance for Community-Based Economic Development (HACBED) and its partner organizations, state legislators* are hosting this special tax clinic to encourage low-to-moderate income taxpayers to save money and claim valuable tax credits. Last year alone, HACBED, its community partners, and 169 volunteers helped low-to-moderate income taxpayers claim over $3 million in tax refunds and over $1.7 million in EITC and Child Tax Credits, saving these taxpayers nearly $400,000 in tax preparation fees.

"There are many in our community who are unaware that they qualify for the EITC and need help in preparing their taxes," says Senator Suzanne Chun Oakland about this free community service for all taxpayers.

“We want to encourage Hawaii’s workers to use these free services early in the tax season to allow them to claim important tax benefits such as the EITC which can be worth from $457 and up to $5,657 for qualified taxpayers this year,” states Representative Della Au Belatti. “Tax clinics like this one at the State Capitol provide a valuable service for our hard-working taxpayers.”

As part of this special tax clinic, taxpayers will be able to file their tax returns for free and receive information about programs that may be of interest to them, including financial literacy classes and credit management. Tax preparation sessions are confidential and safe. All tax returns will be prepared by IRS-certified volunteers who volunteer at other sites coordinated by HACBED’s Family and Individual Self-Sufficiency Program.

HACBED’s Family and Individual Self-Sufficiency Program started offering these free tax assistance services to low-to-moderate income workers at four permanent sites in 2005 when it was first established under Aloha United Way. Today, this statewide Program recruits volunteers
for and coordinates the efforts of over 40 sites and clinics that are sponsored by non-profit organizations, educational institutions, and businesses. Some of the Program’s community partners include Alulike, Inc., Leeward Community College, Volunteer Legal Services Hawaii, the Council for Native Hawaiian Advancement, Honolulu Community Action Program, INGDirect, Goodwill Industries, and several credit unions in Kekaha, Hickam, and Maui.

For help locating other free tax assistance sites, taxpayers can call Aloha United Way’s Helpline at 2-1-1. For a complete list of tax sites on Oahu, Big Island, Maui, and Kauai, more information about the EITC, other tax credits, and HACBED’s Family and Individual Self-Sufficiency Program, taxpayers should visit the Program’s website at www.hawaiitaxhelp.org.

For more information about the special clinic at the Hawaii State Capitol and to make an appointment, taxpayers should call 808-393-4364. Free parking will be available at the public's blue-metered stalls in the Capitol basement.

*State legislators sponsoring this first-time free tax clinic at the State Capitol are Senator Suzanne Chun Oakland, Representatives Karen Awana, Della Au Belatti, John Mizuno, Karl Rhoads, and Maile Shimabukuro.

House passes Unemployment Insurance bill to help business with soaring rates

The state House of Representatives today passed on third reading a bill that would set new employer contribution rates for unemployment insurance. Unless legislation is passed, the rates will soar in the coming year due to the poor economy and high unemployment negatively impacting Hawaii’s businesses.

“Because of the recession, unemployment insurance rates will rise precipitously if no legislative action is taken,” said Rep. Karl Rhoads, Chair of the House Committee on Labor & Public Employment. “HB 2169 will provide significant tax relief for businesses during this tough economic time while maintaining unemployment benefits for those who have been laid off through no fault of their own. Unemployment benefits provide working families with the financial resources to keep food on the table and pay the mortgage or rent.”

HB2169, HD2 proposes the following:

· Sets, for calendar years 2010 and 2011, the wage base at 90% of the average annual wage.

· Sets, for calendar year 2010, the employer contribution rate at schedule D and for calendar year 2011, the employer contribution rate at schedule F.

· Retains the maximum weekly benefit rate at 75% of the average weekly wage until December 31, 2011.

· Returns the maximum weekly benefit rate to 70% of the average weekly wage on January 1, 2012.

· Authorizes special assessments upon employers to pay the principal and interest costs on loans received from the U.S. Secretary of Labor provided that the director of Labor and Industrial Relations develops a fair and equitable manner in which these payments are made.

· Establishes for recalculation of the adequate reserve fund beginning in 2011.

The House and Senate agreed earlier this session to fast-track unemployment insurance legislation with the goal of passing a new employer contribution rate structure to help small businesses as soon as possible.

HB2169, HD2 now crosses over to the state Senate for consideration. If the Senate makes amendments to the bill, the House and Senate will conference to work out differences in the two versions.

Santa?

In the most egregious case of miscasting I've seen in some time, one of our very own House Representatives plays "Santa", shown here with the Chinatown beauty queens.

Looks like "Santa" also agreed to let City Managing Director Kirk Caldwell make a wish.

Reps in the News

DOE Reconstituting Schools

Rep. Roy Takumi, chairman of the House Education Committee, weighed in on the issue of the Department of Education "reconstituting" schools. This means that the DOE would have the authority to replace principals and teachers in low performing schools. The Honolulu Advertiser story is here. Superintendent Patricia Hamamoto says that she will seek authority again (legislation failed in 2009) this year to reconstitute schools, knowing that it is an unpopular direction. Here's an excerpt from The Advertiser article today:

Rep. Roy Takumi, chairman of the House Education Committee, said he supports the school reconstitutions and noted that Hamamoto has made it clear that it would be an extreme measure.

"It's just a tool in the tool box that you may or may not use. The superintendent is not going to waltz into every school that is not (performing). ... You need to look at every school on its own merits," he said.

Takumi said the bill ran into roadblocks with the labor unions last session.

"Should we have it as an option? I believe we should and today we don't," he said.


Hoopili

Rep. Rida Cabanilla. Rep. Jon Riki Karamatsu and Rep. Maile Shimabukuro all opposed the proposed housing development called Hoopili which came before the Land Use Commission on Friday. The LUC denied the permit request. Here is the Honolulu Star Bulletin article. Here is The Advertiser article on the hearing and the decision. Quotes from the article include:


Shimabukuro, D-45th (Wai'anae, Makaha, Makua), said she was surprised when running for office to find out the chief concern for area residents was traffic. "It really is a daily nightmare for people who live on the West side trying to go to and from work," she said.

Cabanilla, D-42nd ('Ewa, Waipahu, Honouliuli) and chairwoman of the House Housing Committee, said urban development should be focused on areas such as Kaka'ako, McCully and Mo'ili'ili where small buildings can be redeveloped with high density.

Auction-rate securities

Rep. Karl Rhoads is concerned about the fact that the state has $1 billion tied up in auction-rate securities that are currently frozen. Here is the Advertiser article.

"It is disturbing that we have that much money tied up in something like that," said Rep. Karl Rhoads, D-28th (Palama, Downtown, Lower Makiki), who learned of the frozen assets from a constituent. "We knew or should have known it could have become illiquid."

Rhoads said he was concerned about the state's reluctance to write down the investments and wonders if the state should be more aggressive in seeking redress.
"If we've lost $114 million, how come we're not suing to get some of that back because Lord knows, we need the money right now," Rhoads said.

Rep. Rida Cabanilla feature on GMANews TV, a Filipino news channel

Rep. Cabanilla was featured on GMANews TV during one of their segments called "Pinoy Abroad". The story is here. It highlights her accomplishments since emigrating to the U.S. when she was 17 years old.

Rep. Karl Rhoads Commentary on "Shared Sacrifice"

The following op-ed by Rep. Karl Rhoads appeared in this morning's Honolulu Advertiser:

Lingle shields rich from 'shared sacrifice'

By Rep. Karl Rhoads

The gist of Gov. Lingle's response to our current budget crisis has been a call for "shared sacrifice." While shared sacrifice evokes images of everyone pulling together to get through a difficult time, the reality is that most of the effects of the downturn have not been shared.

If we follow the governor's lead, state workers will bear the brunt of the burden and most everyone else will not be asked to make any sacrifice at all.

Instead, the pain of the recession needs to be more broadly distributed. The best way to do that is to tap the Rainy Day fund and temporarily raise income taxes on higher income wage earners.
Combined with the pay cuts that state workers have already accepted in principle, we can get through this economic crisis without gutting state government or unfairly pinning the blame for the recession on state workers. State workers did not cause this recession and they provide services most of us consider essential, such as inspecting our elevators, protecting us from food-borne illness and teaching our children. If anyone deserves special blame for the state of the economy, it is private-sector actors who were more concerned about making money than about the stability of the financial system.

To date, the recession has disproportionately affected two groups: those who have lost a job and those who have taken a pay cut. Right now 47,700 Hawai'i residents are unemployed, which means that almost 600,000 are still employed. While a 7.4 percent unemployment rate is far too high, it does mean that 92.6 percent of us are still employed. Data on how many have taken pay cuts are not readily available, but anecdotally it would appear the number is high.

Before deciding how to share the pain, we also need to look at who shared the gain of the good economic times. The answer to that question is very simple: the highest income earners. Instead of asking those whose share of the economic pie has been rapidly increasing to make any sacrifice (the average after-tax income of the top 1 percent of income earners rose 20 percent in one year from 2003 to 2004), Gov. Lingle vetoed a bill that would have raised taxes on a family making $350,000 by a mere $375 a year.

The Legislature overrode this veto and took a step in the right direction, but with the state's fiscal picture continuing to deteriorate, those of us in the highest income brackets are going to need to make a real sacrifice to see us through this difficult time.

Gov. Lingle has argued that protecting the income of the very richest will spur economic recovery. But protecting the income of the middle class (like state workers) is a more effective antidote to recession because higher income individuals rarely spend their entire paycheck. In a recession, spending is what brings recovery, not savings.

Gov. Lingle has suggested that "shared sacrifice" demands that state workers take a 14 percent pay decrease in the form of a three-day-a-month furlough. The average salary for a state unionized worker is $44,252. A 14 percent cut would amount to $6,195 a year. Gov. Lingle has also taken the position that state employees should pay the entire increase in cost of escalating health care premiums. For a family plan, this will amount to another $2,400 a year. Most of us would not be able to absorb an $8,595 decrease in salary. State workers are no different.

Real shared sacrifice requires that all of us accept the responsibility that comes with living in a democracy. State workers have indicated they are willing to take a 5 percent decrease in pay. Health care contribution negotiations are ongoing which may result in a further decrease in pay.

Temporarily raising income taxes spares those who are already struggling like the unemployed or underemployed, unlike an increase in the general excise tax. In combination, these measures will see us through to better times and will turn the slogan of shared sacrifice into a reality.

Rep. Karl Rhoads represents the 28th District (Palama, Downtown, Sheridan) and is chairman of the state House Labor and Public Employment Committee. He wrote this commentary for The Advertiser.

Joint Committees on Labor get update from DLIR

Rep. Karl Rhoads, Chair of the House Committee on Labor and Public Employment, questions Linda Smith, Governor's Policy Advisor and Darwin Ching, Director of Labor and Industrial Relations.

The Department of Labor and Industrial Relations (DLIR) provided an update this morning on the status of the Department's budget and how it will be affected by budget cuts and restrictions. Here are some main points:

*The Department is funded by general funds, but many employees are funded through federal program funds.The department's general fund portion of the budget in $15.8 million. Of that, they expect about $1.7 million to be restricted in the first year of the biennium.

*Chair Rhoads and Chair Dwight Takamine, Senate Labor Committee, were primarily interested in how these restrictions might impact services to the public, particularly services related to unemployment.

*The department could not immediately share that information with the joint committees, however, it will be provided as soon as possible.

*Director Ching clarified that the Unemployment Trust Fund, which currently has a balance of $280 million, will not be impacted by any proposed furlough plan. It is unknown at this time how the state layoff proposal would impact the fund. The department is contemplating reducing the number of weeks of unemployment benefits.

* Linda Smith said that employees with seniority would be able to bump other state employees so they are not sure how much would actually be saved at the end of the process. As such, they reserve the right to issue another round of layoffs if the savings are not sufficient.

*Chair Rhoads requested that the Governor not furlough employees within the department who are funded with federal funds. He indicated that it doesn't make sense, especially with our budget shortfall, to lose federal funds due to unnecessary furloughs. The Governor indicated in the past that if state workers are furloughed, their federally funded colleagues should be as well, even though there is no savings for the state budget.

*Senator Slom asked how the layoff list that was presented to the unions today was developed. Linda Smith replied that the potential layoff list was developed according to each department director's priorities, with the goal of minimizing impact of services to the public.

*Asked if the Governor is planning to appeal Judge Sakamoto's ruling on the Governor's authority to furlough, Linda Smith replied that they had not seen the Judge's written order yet and could not comment on an appeal until then.

*Chairs Rhoads and Takamine emphasized the need to keep the public informed on what services will be impacted by budget cuts, layoffs and/or furloughs. If programs that the public relies upon are terminated without much advance notice, such as Healthy Start, it creates an even greater hardship for families.

Info Briefing on Labor Issues

The House Committee on Labor & Public Employment and the Senate Committee on Labor will hold a joint informational briefing on Monday. Hearing notice here.

Date: Monday, July 20, 2009
Time: 10:00 a.m.
Place: State Capitol, Room 325

Agenda:

*Department of Labor will provide information on how the funding restrictions will impact the department.

*Department of Labor will also provide update on American Recovery and Reinvestment Act (ARRA) funds and on the condition of the state's unemployment trust fund.

*US Department of Labor is anticipated to make a presentation and provide comments on the Governor's proposed furlough plan.

Community Meeting on McKinley High School Athletic Complex Master Plan

Honolulu residents, parents and students are invited to a community briefing to discuss the McKinley High School Athletic Complex Master Plan Monday, March 9, 2009 6-7:30 p.m. on the first floor of the Makiki Christian Church. The plan includes improvements to sports field, tennis courts, swimming pool, and other recreational and community facilities. McKinley High School Athletic Director Neal Takamori and planning consultants will be available to provide details on the plan and to address questions. Community members concerned about the impacts of the sports complex on surrounding areas should plan to attend the meeting.

Following the briefing will be a legislative update session with Senators Carol Fukunaga and Brickwood Galuteria, Representatives Tom Brower and Karl Rhoads, and Councilmember Duke Bainum. Lawmakers will talk about important legislation making its way through the legislative process and answer questions.

Refreshments will be provided. For more information, please call 586-6890.

Community Coffee Talk with Makiki Lawmakers

The public is invited to a Legislative Coffee Talk with Representatives Della Au Belatti and Karl Rhoads and Senators Brickwood Galuteria and Carol Fukunaga at the Makiki Community Library on Wednesday, March 4, 2009 from 6-8 p.m. The legislators will present their mid-session legislative update to the community and answer any questions about this year’s legislative session. The Makiki Community Library is located at 1527 Keeaumoku St. in Honolulu.

Please contact Rep. Belatti’s office with any questions at 586-9425.

Reps Newsletter Online and Hawaii Foodbank Events

Newsletters from Representatives Jessica Wooley (D-47 Laie, Hauula, Kahaluu, Kaneohe), Gilbert Keith-Agaran (D-9 Kahului, Wailuku, Paia, Spreckelsville), and Isaac Choy (D-24 Manoa, University, Moiliili) are now available online.

The Hawaii Foodbank Calendar of Events has also been updated. Check them out in the right-hand column of the blog. From the fliers I've seen in the elevators it looks like we're all going to have to make a mid-session resolution to shed the "legislative pounds". Items for sale include tacos, ice cream, root-beer floats, musubi, cupcakes and much, much more. That's just for March.

One lawmaker took a more "active" approach to raising funds for the Foodbank. Rep. Karl Rhoads is holding a Nerf Basketball Challenge throughout the month of March. Word is the grand prize Is Possibly Out of this Dimension. NAh...NO kidding? A bunch of gift certificates for Starbucks and Jamba Juice will be given to runner ups. Challenge is open to Capitol employees only.

Public Union Benefit Bills Held in Labor Committee

The House Labor Committee, after giving the following bills a full public hearing this morning and last Friday, voted to hold the following measures, meaning they are dead for the session. The proposals generated heated comments from members of Hawaii's public unions, including members who are currently working and those who are retired. It was standing room only at the public hearings.

As both Speaker Say, who introduced the measures, and Chair Karl Rhoads indicated in their opening remarks, the bills were not meant to target state and county workers. The state faces a severe deficit, and the legislature is required to balance the budget by law. Rather than impose layoffs, the bills were offered as a way to share the burden and help save jobs. Due to overwhelming opposition, Chair Rhoads recommended the bills be held.

They are:

House Bill 1715 RELATING TO RETIREMENT. Increases, for new public employees, the minimum age and length of service for an unreduced service retirement allowance.

House Bill 1718 RELATING TO EMPLOYER-UNION HEALTH BENEFITS. Specifies that the requirement that the State and the counties reimburse retired employees for medicare part B premiums through the employer-union trust fund applies only to the employees who retire prior to 12/31/09.

House Bill 1719 RELATING TO PUBLIC EMPLOYEES. Suspends state and county contributions to the EUTF for all state and county employee-beneficiaries who retire after 7/1/09, regardless of date of hire and years of service, if the employee retires before the employee's medicare retirement age. Resumes coverage after medicare retirement age. Allows employee to retain health coverage through the EUTF by paying the respective state or county share of premiums until medicare retirement age.

House Bill 1723 RELATING TO PUBLIC EMPLOYEES. Makes employer contributions to the employer-union health benefits trust fund non-negotiable under collective bargaining. Establishes employer contributions for active public employees at 55 per cent of monthly cost of the health benefits plan.

House Bill 1725 RELATING TO THE HAWAII EMPLOYER-UNION HEALTH BENEFITS TRUST FUND. From 07/01/2009 to 06/30/2015: (1) prohibits health benefits plan of the employer-union health benefits trust fund from providing prescription drug coverage; and (2)allows board of trustees to make prescription drug benefits available through drug coverage plans that are paid for entirely by employee-beneficiaries.

House Bill 1726 RELATING TO THE HEALTH FUND. Prohibits the Hawaii employer-union health benefits trust fund from providing group life insurance benefits if any of the premiums are paid by the State or a county. Allows the trust fund to contract with a group life insurer to make available group life insurance benefits to employee-beneficiaries provided that none of the premiums are paid by the State or any county and the insurer pays a fee to the board of trustees.

House Bill 1727 RELATING TO THE HAWAII EMPLOYER-UNION HEALTH BENEFITS TRUST FUND. Prohibits the health benefits plan of the employer-union health benefits trust fund from providing dental and vision coverage from 07/01/2009 until 06/30/2015. Allows the board of trustees to make dental and vision benefits available to employee-beneficiaries at no cost to the employers.

The Labor Committee also heard House Bill 1106, RELATING TO PUBLIC EMPLOYMENT, and decided to defer this measure. That means that the bill is not advancing through the process at this time but could be resurrected if needed. The bill “protects the rights of public employees by preserving health, retirement, leave, and other benefits if furloughs are implemented in fiscal years 2009-2013.”