Senate Standing Committee on Ways and Means

Hey. Calling to order the Joint Committee on Ways and Means and Economic Development and Tourism. So this morning we're going to hear from the Department of Business, Economic Development and Tourism who will present their supplemental budget request. Good morning. Good morning, Chair.

Good morning. Chair Dela Cruz, Vice Chair Moraki, Chair DeCoite and Vice Chair Wakai. Thank you so much for this opportunity. Per the request, we will go straight to table six. No, unless you guys have these accomplishments, this is long. Well, that is whatever you want, Chair. Whatever you.

I mean just you can quickly go over them.

Okay, then I will.

We let the AG went go over her accomplishments. She was the only one so far that started with that.

Okay, okay, so we'll skip the part that I talk and

Let's go straight to accomplishments and then we can go table six.

Okay, we'll cover that. If I could get some time to kind of talk about not only the accomplishments but what we're working on, which kind of shows our plan, where we're at and where we're headed.

So I'll definitely skip through a lot because we're entering year four of the first term and the first two years, what we talked about was moving the needle. And that strategic framework was based on looking at past reports, past studies.

In addition to incorporating some of the studies and reports that were done during our first three years here, such as HCR184, where we had to survey the Creative Industries division, mainly the fashion industry, SR111, accompanied by Act 239, which was the interagency food systems, and then Act 187, which was to integrate a land use strategy.

So there are three major factors that stagnate economic diversification. 1. Business costs. How do we reduce costs for business? No matter if it's the film industry, value added product manufacturers, that's both food and non-food, or even advanced manufacturing cost to do business, the workforce.

DBEDT, for these past three years, we've been in discussion as well as mapping out with DOE's Workforce Development CTE programs as well as the P20 team.

And how do we align that it's not just about the workforce and cte, but making sure that as they graduate that those students, those high school students have trajectory into a career and vice versa with the industries is there CT alignment. Third is infrastructure.

So this is turnkey facilities, shared facilities, open access facilities for our small to medium businesses. One of the biggest faults for small to medium businesses not diversifying or scaling up is the lack of facilities and equipment. It's a valley of death to do that. DBEDT focuses on four key areas. Okay. Straight to accomplishment. All right. Okay.

So for, just last year, Honolulu Community College has opened up the first state's advanced manufacturing facility. So we are partnering with HCC and why this is key, we're currently discussing with two companies as well as Department of Transportation to look at Hilo Airport to bring in two aerospace companies.

This is for horizontal and vertical horizontal lifts for satellite launches, drone launches and other type of aerospace activities. There is no budget request in Table 6 for this because what is needed is a hanger facility. We haven't been speaking to House and Senate Members.

We're looking at working with them on a SPUR Bill as well as a CIP Bill to ask for funding to go to DOT for hanger facility. We're working with.

No, wait. Go back, there was only one of the four. Go back.

The advanced manufacturer.

Oh, I thought this was. Those four are not your. It was only one thing that you guys did.

So no, we're going to keep going down. Okay.

Okay.

That's for advanced manufacturing for healthcare and tech. We've started to work with legislators as well as the Cancer Research Center to start understanding the data and what's potential for healthcare and healthcare tourism.

This includes translational drug development, early phase clinical trials and data and AI and R&D. The facility there would be the UH Cancer Center. So who. Who's doing that? We are working with HTDC and uh, Cancer Research Center.

Okay. So the first, the advanced manufacturing is which agency?

HTDC as well. Okay. Yeah. And what. And aerospace is with HTDC as well.

But I just want to be clear that HTDC had nothing to do with the construction of that facility.

No, but we did. When my first year HTDC, we took a tour to Oak Ridge National for that program. We met with Oak Ridge National Lab and the Navy was there in Navy and. As well as the College of Engineering and they decided the facility to go at HCC.

Okay. I still. I'm not clear as to what HTDC brings to the table.

We're bringing the companies here, but what's key is you need the workforce development and the equipment so they can help with the components for this equipment once these companies come here. This is all part of Advanced Manufacturing. Okay. This is the employment base. In addition is also the shipyard with the marathon.

So later on HTDC, maybe they can do a PowerPoint because I don't know what the pipeline and pathway is. So we have the facility. It's educational. But then what comes out of it? How many jobs? What kind of jobs are we talking about? Where are these jobs going to be?

What programs in DOE so that can be hopefully fleshed out a lot more.

Okay. And okay. There is one Bill that we have under the admin package for consideration for HTDC. There's no fiscal impact to the General Fund. Current statute allows for grants under SBR just to go to certain SBR and STTR awards.

We're asking if we can broaden the SBR or our grant process to go after other federal grants for aerospace and advanced manufacturing. We currently have dollars, but they require a non state match. And we're limited or not just to SBR federal funds for media, fashion and music.

We're working on a pathway that goes straight to global marketing and export. We recently executed a MOA with UH ACM. We're working with Chancellor Penalosa on how we can utilize that facility for product development and film as well as we're exploring what the AI curriculum is as well as the equipment needs there.

We have discussions with the TRU initiative at HTDC.

Which DBEDT agencies are involved in this?

This is HTDC and CID. And then we're working with DOE and their Creative Industries Pathway and the School for Adults on the soft skills and the career and the career foundations.

So later on HTDC, maybe they can present a much more robust plan. . Where are the shared facilities? What are the jobs?

So I mentioned earlier, HCR184, we did locate some additional funding from a prior year appropriation. This was just a rendering, it's not site specific yet. But this was proposed for the sandbox block. You see sandbox right here. HCR184 pointed out that for our fashion and music industry they need specialized equipment and open access facilities.

We were looking at repurposing funds. However, we're also looking at other potential land, state land and private land available in the Iva Lake Kapalama area area, which will put it closer to Honolulu Community College in alignment with their fashion, tech and melon music program.

How does this tie into the DBEDT report that we first saw on economic forecasts? Because your guys economists talked about specific low hanging fruit. But I don't see connection between what they present and how these agencies are pursuing those no hanging fruits to diversify the economy.

Oh, there's many different parallel tracks as you can imagine.

So if you guys can go back and trace some. Don't make up something on the off the cuff.

No, no, I'd rather see something like in writing that says this is what the research showed because that's what we kind of were asking about, where are the investments so that we can grow the economy and if it can be specific to what your guys economists had presented initially.

Some of this does tie in, but it almost, it's not as it's not being communicated that it's very specific, strategic, and integrated as we would probably want to see.

Okay, we'll work on that, we'll get to that. So Reid does an emerging sector report every year. In that report they, they list all the sectors to the state's economy. So tech and innovation, creative industries and product development were one of six we narrowed down based off of Reed.

We did ask who determined that these are our sectors. It's government through policy and through the funding. So low hanging fruit that we picked up off of when we first got here were the healthcare and energy which was already being done by the healthcare industry like Healthcare Association Hawaii.

We worked with workforce development, we ran a contract an RFP out of business development support division. They just graduated a class, 25, 50 students. Almost a quarter of their graduates are going straight to workforce. Aspirationally, we started pursuing aerospace with the resources that were given by the Legislature, we got a position as well as advanced manufacturing.

So there are aspirational and low hanging fruit within each three sectors. The low hanging fruit and media was film. But also as we pursue towards AI and creative, we do need to make those investments into facilities.

Yeah, well you know what would be good though is that we don't have any report from you guys that says if we make these investments, this is going to be the economic impact. This is the amount of jobs that can be created. We don't have the end game.

Okay, so for value add, let's take that for example.

No, no, no, I'm talking about the earlier on like HTDC with the advanced manufacturing facility at HCC.

No, but so even for, for the FPIN we have to run additional questions out of the companies exiting out to get those numbers.

No, not necessarily. So like when we went to Australia they said that they justified the facility because they showed economic studies that showed food manufacturing will improve the economy. So that's the study that I want. Okay, so you're talking about after the fact, what's the real data?

What I'm asking for is when you create a business plan, you have to show us. Our studies show that if we invest in this, these are going to be the impacts.

Okay, okay. So proof of concept is done for the manufacturing facility which ADC is leading. We also pulled in our commodity coordinator that we got just last session to do mapping. We have a list of about 11 commodities. Eight more were requested to CTAHR and Department of Ag and Biosecurity.

Did. I'm not sure. Did you guys watch the economic forecast? Yes. Okay, so the second your hero's report showed construction and so you're talking about shared facilities and all. Okay, that's all construction, value added. And I'm not sure how it's.

You mentioned fashion, but on the advanced manufacturing, I didn't hear too much about export, but UHERO report shows that trade is a low-hanging fruit for us. So the more manufacturing, the more production of goods that should be part of trade.

So I just want to see at some point some alignment of the economic forecasting and then how all of this fits into the low hanging fruit cup.

Yeah. And obviously the value-added center.

It's that you can, you can. If you end up categorizing them in these construction, trade, finance, real estate, manufacturing, that's where UHERO is saying the growth can be other than tourism.

So when we do, when we did look at manufacturing trade, it's not that detailed. We're trying to go deeper into the specific sectors or industries we're targeting now. And these can all. But these might all fall under manufacturing. They might all fall under trade.

Yeah. So all I'm saying is that you could end up putting some kind of marking on each one that follows one of these four.

Thank you, thank you for that chair.

And as you know, you folks know, a lot of some of the initiatives that we have done came from this body and you know, the Legislature and we've, you know, fulfilled the obligation that you folk gave us, which are good things like the Value Add Center, like the Culinary Institute of the Pacific.

These are all great things that have happened since, you know, we've been at DBEDT and it came from you guys.

And we understand that the Legislature is our bank and if that's the will of the Legislature to go in this direction, whether it's, you know, aerospace or whatever the different sectors are, you know, we have been very diligent about doing those projects that you guys have listed for us.

Yeah, I mean, but you know, we, the more data we have, the more precise we can be and the more impact we can have.

Yeah. So we asked all of the agencies to put together three of the top things and we put it in a video so that. And we'll send it to you folks so that you can see it. I don't know, it's.

We don't have the time to do that today, but we will send that to you chair, and the Members of the Committee.

Okay.

Okay. So we can shift back to table six.

Yeah. Priority one.

That's just a conversion. We're asking to go from revolving fund to a special fund. So I believe the MOF prior to that. I think that was a letter W. We're asking the shift to be. That's based off of a. It was the auditor report. There's no, there's no funding request there.

We're just asking the shift change, the MO, the means of financing

Yeah. Okay. You know what? If you guys. Just for your own notes, it was your guys, PowerPoint on economic forecasting. It was page 15.

So you talked about slower but positive growth with gradual rebound. So that shows there's potential. So if you have investment, then we can expedite, hopefully. And it talked about US Economy proving more resilient.

So instead of doing these trade shows in Japan or Korea or these other areas, focus on the US Market because according to your data, that's where the strong economic growth is going to be.

19 companies just went late last week to the Fancy Fair Food Show. Local companies.

Yeah. But if you guys can evaluate some of the other international trade shows to see if it makes more sense to redirect those dollars to the US Economy.

So in those Japan trade shows, as you know, chair, we sponsor the booth, but at least 20 companies go up and sell their ware. So the impact or the output for us is not huge, but it's a big impact for those businesses who do go.

Yeah, but oftentimes it's the same businesses. So if they've established a relationship, why does DBEDT have to subsidize it? I mean, a lot of these companies are the same companies going year after year. I think that's something that Senator Hashimoto had brought up. So it's not like we're bringing new comp. A lot of new companies in.

Seems like we're bringing a lot more new companies in things like the Fancy Food Show.

Yes, but we will get that information on the.

So, you know, government's role is to help assist, but we cannot subsidize businesses. You know, we got to grow the economy then. One thing, I'm sure you guys are including this, but one of your points was the AI productivity boom.

And so hopefully a lot of the things that NELHA, HTDC, they got to figure out how to get into this boom. But this is according to your guys data.

Short question on table 15 on BED.

Oh wait, let me finish table six first.

Oh, okay.

Yeah. So on table six, BED, 115. Chair, the Governor and others in the industry are focusing on sports tourism. So the Governor is requesting an additional $3 million for sports tourism. At HTA, last year we implemented a new Committee, the Sports Tourism Committee.

And it is our intent to look at additional sporting events that we could market to. And we know that with the things changing in landscape of sports, college sports with NIL, we are in jeopardy of losing one of our big tournaments on Maui, the Maui Invitational.

Because tournaments in Las Vegas at the same time attracting the same teams are spending over a million dollars to attract those teams. We cannot compete with that. So we need to look at how we can look at other venues or other tournaments that.

Yeah, so do you have a plan and a breakdown of the 3 million?

Yeah. Yes.

Can you send that to us?

I have a question with regards to the sports and the golf and only because the Big island holds several. I understand is the senior tournaments that are held annually as well as. Is that in danger?

Not this year.

I thought I saw an article that included some that the Hawaii island and the Hawaii Golf tournaments are in jeopardy.

Yeah. The Aloha Swing is three tournaments and it starts with the Century on Maui which was last this past weekend and then the Sony this weekend. The Sony's contract ends at the end of this tournament. The Century contract ends in 2030. So whether the PGA Tour comes back to Century, that's still something that they have to negotiate.

But our contract with Century goes to 2030. The Hula Lai tournament, which is the Mitsubishi. I'm not sure on when that tournament is expired.

Well, it's very popular.

Yeah. I mean if I'm going to watch the tournament because these are the guys that were, you know, big when they were on the PGA Tour and it's more relaxed, they're more engaging with the fans. So. Yes, it certainly is.

And golf as you know the Committee knows are some of the sports and recreations that attract the higher spend visitor. And we understand that and I know that's the focus of DBEDT, HDA and the Legislature.

Thank you.

Chair. So for the new Sports Tourism Committee. Did you guys put any money in it already? Or is this just your ask?

This is. Well, we put in $500,000 from a different fund that a destination management.

Okay. So you had a conversation that we had in Kauai.

So who is. Who is we? Who is we? Yeah, he said we put 5 million

HTA and DBEDT.

Who made that decision?

I did.

So not the board?

No. Well, but the board was made aware of it and the board was supportive of it. But now that it's advisory and not policy, we did talk to the chair and the vice chair of the.

Yeah, but the CEO reports to the Governor, not the Debate Director.

We don't have it. Well, we have it temporarily assigned.

Yeah, so do you have the statutory power to do that? I don't think so.

We can check, but. Yeah,

I don't think so. They're administratively attached to you.

Okay, well, we'll check and.

All right. I just like a clarification because we had that conversation and I remember it, that he did bring that up to you, that it's not in the statute to divert money from one place to another. And then like how you said we.

You know, I know we had a bill to remove you from the HTA board, but it seems like you have a lot of influence and you've been in a lot of meetings and the CEO is not really answering to the Governor. He's actually answering to you.

So I understand the CEO is temporary, Jimmy, but again, the reason why we created that Bill was to take out DBEDT from the Tourism Board. That's not happening. So again, you made a decision to divert 500,000 from destination management.

Right now the program that was working within there is now on hold because of lack of funding that they had that was having all these different hotels that was signing up to get the best tourists, you know, tourist education, all of these programs.

And now it's on hold because the funding that was diverted to the new agency was taken away from Destination Management. So the program is now, if you go on the website, CNHA is on hold.

How did, how did you do that, though? Because the Destination Management is under BED 116, and sports and signature events is bed 115. So you took 500,000 from 116 to 11 and you moved it to 115?

Yes, yes.

So that's, that's not allowed either because there's no proviso that allows the Administration to move monies from one program ID to another. That proviso was taken out years ago.

Okay, so I may be wrong on the number of the fund, but I know we understood from.

Destination Management, if you look at Destination management is program ID, BED 116, sports and signature events is program ID 115, which means that's two separate program IDs and there's the Administration doesn't have the authority to move monies from one program ID to another.

Okay, so let me go back and make sure we have the specific details on the transfer. But I can tell you that no money has been spent yet. The money has not been spent yet. So we didn't do anything yet. But the intention was to put money into Sports Tourism. That was the intent. But nothing, nothing has been spent yet.

But chair just clarification, so, if you know you guys, a Governor and you guys decided that you guys wanted to create this new Committee, Sports Tourism, the Hilo Hana program that you took the money from. Well, CNHA, the Destination Management is on hold.

So if you guys didn't spend them, so you guys didn't spend the money, then why take the money out of programs that was already established and people signing up, different hotels already was signing up for the program. So I.

What Program Center? I don't. Which program are you talking about?

From you can start the month for Destination Management.

Well, Caroline just showed me the program that we took it from. So I will get, I think we did it the right way, but I want to make sure that we're doing, I don't want to bring it on the fly. You can start the month for Destination Management.

Okay, so that's not Destination Management.

No. Then I, that's why I said if I, if I quoted it, if I stated it wrong, it's my fault.

Okay, you had a question.

Yeah. You mentioned the Advisory Committee. What exactly is advisory Committee doing and how much are you folks informing them?

Well, the Bill, when it was passed, SB 1571 was specifically was specific and very clear of what the board could and could not do. And the one thing that the board was responsible for is hiring the President and the CEO.

So the other things that the board did before, which was the budget and some of the other program stuff, they don't have that oversight anymore.

So what do they advise you on? I mean, because I've got calls from board members, they're not clear of what they're doing. They think they were just window dressing now because they're not clear that nothing is brought before them for their advice. Nothing is brought for their deliberation, whether they have a vote or not. The fact that, that their advisory. What are they advising on?

So one example is the Film Committee. The Chair of the film Committee put together a proposal for a pop-up museum that the cost for that was 200 something thousand dollars.

So their responsibility was to draft the proposal loaded to the Administration at HTA, have the discussion with the program managers at HTA and decide whether that's what they were going to support or not. And that one program was something that they were comfortable with. It went in front of the board.

I'm not sure if they voted on it because it's advisory, but the advice went to the HTA Administration and they're moving in that direction. There's another proposal that the chair put in to do funding for this film festival.

Can I stop you right there? Okay, I understand there are certain projects that they but when you say advisory like on the sports tourism, is there anything that brought to them, like what's your advice? Or what do you guys think about this? You know, other kinds of stuff because they're saying that nothing's being brought before them.

So you brought the 3,000,000 dollar proposal to them?

Not yet. We just got this. I mean the Governor put it in, in his budget when he sent it down.

Yeah, but you transferred the money already?

Not on the 3 million. No.

The 500,000.

The 500,000

Yes.

And so they, they, they know about the 500,000?

Yes, the Committee of the Sports Tourism.

And the 500,000 is supposed to be for what?

Or things that they would discuss on whether it's we.

Okay, I want to know what you want to spend it on.

Absolutely. But they, but if you're asking me if they have input, they come up with suggestions on what we would promote or use that money for and then it goes to HTA.

But why wouldn't they do it? Like the Board of Education and the UH, regents where they have to vote on the budget. They don't change the budget on the fly usually. Because what you're doing is, Oh, here I have 500,000.

What do you guys want versus as this budget is proposed prepared, they should have been reviewing what the strategic plan is, how much it's going to cost and then you guys can take that, review it, whatever, but it should initiate from them.

So if you look at how the request is made, it's left open to see which programs they think we should do. And I'll give you a perfect example. The Seattle Rain is a team from Seattle. It's a female soccer team, professional female soccer team.

So they have come and they have met with the board and the Administration at HDA to talk about coming to Hawaii to play their preseason games in Hawaii because Seattle, their preseason games will not be able to be played in Seattle because the World Cup is playing in all of the fields throughout the Northwest.

So they want to come to Hawaii and it's going to cost. They're putting in a proposal for a million dollars. And I told them that maybe a little too rich for what we can do. So they're working out a proposal.

Why are you telling them that?

Well, I'm in the meeting.

Yeah. Okay. We're not on the advice report, and the CEO reports to the Governor. And so why are you telling them that?

Because the Governor. Every single decision or every single discussion that I have at HTA, I float to the Governor. I don't do it in a background.

It should be the CEO that floats it to the Governor. Well, that's what the statute says.

So the CEO, interim. We don't have, you guys know, we don't have a CEO right now.

Yeah. All I'm saying is that's not what the law says.

And the loss is the Governor. And so.

Yeah, and it says that the CEO reports directly to the Governor. So a lot of these things should be from the CEO directly to the Governor. It doesn't say through the DBEDT Director.

So can I finish? So, Caroline, do you advise or put things before this advisory. Who oversees it? So what kind of agenda items have they had on their meetings?

Thanks. Thank you for the question. So in the past, the last couple of months, you know, we've been working on our strategic plan. And so we invited the chair and vice chair of the whole Hawaii Committee to sit in on the discussions on the strap plan as we developed it.

As a whole of the Committee. Okay, you have how many Members on there? 9, 10, 12. 12. 12 of them. No, no, I'm talking about the advisory Committee, not advisory Committee of the Committee, the overall Committee. So there's an overall Committee, have a meeting and you present on this agenda item.

We're going to talk about the budget on this agenda. We're going to talk about this. We're going to. And, and, you know, so you guys can review and advise. Can folks do that?

You've been doing it by Committee and then bringing it up to the advisory board.

Okay. Can you submit to the Committee these agenda items? Because the Committee, the Members are calling me and saying they're not sure what they're supposed to do when they bring up something. They say, zero, that's not your area.

Or they're told to, to back down. So I'm just curious, and maybe they should be, but it's not clear as to what they're supposed to be reviewing or not reviewing or advising or not advisory.

All right. I mean, happy to

Yes. Okay. Thank you.

Caroline, have you given the advisory any type of training?

Yes, we.

What responsibilities are?

We held an orientation with the board, advisory board members a couple. A couple of months ago.

So when you report, who do you report to?

So I serve at the pleasure of the Governor, but Governor has delegated to DBEDT Director, the authority. So I report to Director Tokioka right now.

Has any of your board Members talk to you directly that they don't understand what's going on?

No, they haven't.

Have you asked them if they understand what their task is?

No, I haven't.

Maybe you should ask each and every one of them if they understand what they're supposed to do.

Okay, thanks.

Caroline. Can I add another complexity to your vetting process? Whether it's sports, tourism or just any other kinds of marketing plans that the private sector weigh in on all of these ideas like.

So, for example, if the female soccer team from Seattle wants to come here, rather than just arbitrarily saying a million is too rich, maybe 500,000, that you also take that out to the private sector to say, like, you know, banks, hotels, private businesses in Hawaii, do you want a pony up to match whatever DBEDT is putting up?

Because so many times I get the sense that we put up money and if the private sector is not there to support us, maybe it's probably a bad investment on our part.

So that all the contracts we look at, if there's not a private sector buy in or an entity out there that's supporting DBEDT, maybe we shouldn't be making that investment in whatever the campaign might be. Do you guys do that?

So when proposals come in, we do run it through, I would say a scorecard to see the potential of this investment. And yes, we do look at the community benefit. And also how does this affect our.

Who is we? Is it just you? Who is we?

Yeah. So we have a sports consultant, Playfly, who we work, who our sports manager works with to vet proposals. And we also work with Director Tokioka as well as the chair and vice chair of the Sports Committee to look at proposals as well.

How does that process work? Everybody gets a vote and then there's a balance of an average for grade for this scorecard you're talking about or.

Yeah, sorry, I don't know this. The scorecard exactly. All the components. But it, it does go through our sports. Our sports manager reviews it and so he puts it, he works with a sports consultant.

We need to articulate the process.

Yes. Sorry, I don't know it. Yeah, I'll provide you the information on how it's done. But it does go through a vetting system

Because if you cannot articulate it, it comes across arbitrary.

Okay.

Or political.

Got it.

So that scorecard, in the future, can there be a criteria that there has to be some private sector buy in that the private sector has to put in money of your campaigns because if the private sector is going to just hands off on basketball marketing to whatever, then it's probably not a good investment by the state. So is that a yes? You will put that into your scorecard?.

Yeah, we'll look. Let me look to see what is all the components of the scorecard. But I know that there is partnerships in there and I will get back to this Committee on it. Thank you.

Who developed the scorecard?

Yep, our consultant PlayFly.

You just leave it up to a consultant.

So the consultant developed it and I'm sure our staff weighed in on the components of the scorecard.

Can you give us a copy of the scorecard?

Yes.

Chair, just a follow-up. Caroline. The reason. The reason why it's confusing and what Senator Kim was saying is because.

No, just ask your question. Interpret any other Members thumbs. Just ask the question. Okay, next.

So then the next two line items are for NELHA. First one is we're requesting the establishment of one FTE for a cultural practitioner. Also to restore the salary of the unfunded admin assistant position. So currently.

Are we still on table seven?

Okay. Okay, so wait, there's second. So what is the big what? How did this come about?

Okay, so Nell has been pushing forward on a master plan. And as we're going through that process, there are a lot of cultural activity and questions being brought to the board as well as to the agency. So to help mediate this and help with the master plan, we're asking for a cultural practitioner on staff.

Okay, what's the master plan for?

The master plan is for the remaining underutilized plans of host park. We have additional lands that has no infrastructure and we can't. Unless we get infrastructure facilities, we won't be able to monetize or create revenue for that host park.

Okay. Are there vacancies at Naha?

There are so. Well, I go back and check. Let me double check. I'll get back to you on that. But this is not asking for a General Fund. It's just we're asking to use our existing.

Vacancy from two months ago. It's the account third and we're in the process of approving for that.

Okay, next.

Ok, now any questions on this one? Okay, next.

Okay, and then the second one is the restore the funding for the admin assistant. The next one is BED 160. This is HHFDC. Currently, HHFDC is managing 2.4 billion in assets and loans.

We're asking for capacity assistance by asking for a temporary assistant controller to help the chief financial officer. We're also mapping out additional what the strategy is for housing moving forward. 77,000 units statewide. And so we need capacity with HHFDC to help with the existing loan load.

Okay. And they don't have vacancies.

We do have a couple. I'm not. I got Dean, do we have any vacancies available or they're all under recruitment.

We have vacancies all under recruitment.

Seven vacancies.

And how long have they been vacant?

Most of them not very long. The longest civil service position. That's been about year.

Wait, I got it. Yeah, go ahead.

So they're showing the from 2024 through 2025 are the, so just over a year or two on a couple of the vacancies.

Okay. So Dean, did you start the 360 review that we talked about when we actually increased your ceiling so that you could give pay raises? Because you said before that you did no review of any staff.

Annually and you incorporate that as part of the review for raises. Well, you asked for the money for raises. That's why we. That was the whole point. And so.

And you incorporate that as part of the review for the raises when you do give them.

Okay, because. So how many years have you done that? Just the one. Okay, so before that you guys had no evaluate.

So DBEDT your agencies, they don't give reviews. Somehow, hopefully, as you meet with all the different agencies, you have consistency on job reviews. I know that's one of the questions that someone had brought up at a previous hearing.

Yes, we hired a new human resources person a month ago and that is part of it. And as you can see, Chair, when you look at the vacancy list, we took to heart your direction over the last two years on the. The number of vacancies that we have.

No. Yeah, but you're asking for some new positions, but they still have vacancies.

Yes, and that was brought up when the request was made for the new positions. If every time there's a request for new positions, we ask the vacancy question. Yeah, and some can be transferred and some cannot.

But we do ask the program managers if there are vacancies that they can trade transfer. Okay.

Senator Kim had brought up the fact that, you know, she had questioned DCCA about HR specialists teleworking. And I noticed that.

I noticed that HHFDC has a HR specialist at teleworks. So how is that? You know, the whole point of HR is they have to be available to people. You have to be able to walk in, talk about HR issues, but yet they telework.

They telework two days a week.

So we can hire nobody in an office

While she's turned working. She's still available by cell phone or she's available during

Okay, and how do you track that? How do you track her workload and her productivity?

So you specifically make sure that. Because Attorney General does timesheets. What kind of process do you guys have? You just.

Just kind of just watch to see if you get emails from her or not. That's your only gauge.

Question 2. So the vacancies, are we talking about civil service and exempt or all vacancies? We're talking about our civil service positions.

They got to speak in the mic.

I think you have a mix. You say come on.

As he's coming up. I will by a show of hands to the.

The Department managers tell you that we spend a lot of time in meetings when we were going through the whole progress process of telework, that there, there had to be a standard and forms that filled up every single week if somebody's on telework and they had to get approved from the Department manager.

And this was for all of the departments, not only hhs.

Well, the concern I had in question is we're dealing with vacancies and they're both civil service and exempts positions.

And another reason I ask is that in filling vacancies, I understand that the exam positions are better and faster, easier to fill because on the civil service positions, it takes almost half a year to get somebody in that particular position.

That's why DHRD is asking for exam.

Thank you. That's my question anyway.

Okay. What is this? Temporary assistant comptroller.

That's the one we just did. You want to talk to Dean about the human resources or problem? Because they, they asked him to come up to speak in the mic. Yeah. Did they. Did. Did he answer your question?

Yes. More you want to talk about on the system controller or did I cover?

No, she. She asked and then he stood up. Yeah. So as long as it's answered.

Any other further. Spoke about the system control earlier. I'm not. We do have further questions. Dean can.

160. And they cannot absorb that now with any of the positions.

Not in the seven.

No, not right now. We all, we have. All of our vacancies are under recruitment and are needed.

Yeah. You know, but you and I had this discussion. When you look at the output that, that HHFDC has had, a number of units and the amount of money you get, it's relatively flat, you know, over the last 20 years or whatever it was.

When you look at your annual report, it's all about 732 or 34 units per year on average. Money has spiked up dramatically and we haven't seen the doubling of the units you guys produce.

It takes some time before the money approved by the Legislature results in units. So this year, for example, we delivered 1,460 units, which is a lot more than we have historically. And it's because of the infusions into RHRF that we can deliver more.

So 300 more units, but way more money than that.

And well, costs have also risen. But you look at our pipeline, there's 10,800 units that we project delivering in the next five years.

You know how much money you have in. How much money do you have in.

Turf in Durf Available balance roughly about $100 million.

You only have 100 million left.

Is it spoken for or no? Yeah, the other rush is spoken for.

Yeah. So how much total is in there currently?

I have to go back and look at the total DIRF balance.

Okay. Because you're the vice chair or the co chair of TOD Council and you guys haven't done anything to put in infrastructure or housing along the tod.

We just approved a DIRF loan for regional electrical infrastructure in Kakaako at last week, Thursday's board meeting.

But you know what, quite frankly, you know, no offense to my colleague, but over the last 50 years we put millions of dollars into Kakaako and there's more than one rail station. We're not only focusing on the rail station of Kakaako.

So what is HHFTC Office of Planning doing so that we can make sure we develop out the rail line?

Yeah. And we are looking at supporting projects along the rail line now looking at.

It doesn't mean it's going to happen.

We have an active contract for the Iwali Kapalama area with a consultant helping us identify improvements to the rail isn't even there yet.

Okay. There's rail all the way from Benjamin Kalihi all the way to Kapole. How many projects along any of those rail stations?

There are projects. I'm not sure the number though.

Can you provide a report?

Yes, we can.

Yes.

I mean some of those stations have been around for a couple years now and I haven't seen any activity.

And Chair, just to add the Kakaako rail station, that project on Nimitz that affects the downtown area, my understanding is that's going to take five years. So why are we down in that area? I agree with the chair. The TOD has been involved. The Committee has been there for like three or four years.

So you know, Pearl City. Pearl City area needs some housing beyond that. Yes.

Yeah.

You can just agree nothing happen. Yes. What are you guys doing about it? See, I keep telling you just like how you micromanage hta, micromanage them and get, get units out. You actually have A board seat on this one.

Question. Yeah. The question is generation. So around the coupling area, don't the state own most of the land in that area?

Around couple of area, yes. Wine, Homelands, Dags and uh have sizable land holdings.

So exactly what he's saying. So how come we're not looking into trying to develop that area since a lot of is state land.

We have been talking to uh, about developing their lands at uh, west.

Where's the sense of urgency though? So you're saying you have all that money. Some of it is spoken for. You $100 million not spok for. Okay. The fact that you actually have money, that much money unspoken for. When you have all these projects that have to happen along the rail line, what are you guys doing for the.

Lands around uh, East Coppola? Those are under our control. All, all that lands quite a bit.

Has quite a bit of flexibility. And if you need help, why don't you come back and say can you guys buy these parcels or can we get money for land acquisition? Although some of your money can already do that.

Yes. And we are looking at land acquisition. We have a broker on board. We have developers on board to help us evaluate properties.

They should have been doing that already. How long have you been co chair of the TOD Committee or how long has HHFDC been co chair?

I believe since the inception of the Committee.

Yeah. When is that?

How long?

Over five years. I'm a Member. No, at least 10. Yeah.

Yes. Yeah.

Well, you can't either want to say.

I'm not sure it's prior to my time at hhfdc.

Okay. So. But it's been a while and we haven't seen any progress here.

Can I add just because we're on. On the tod My understanding with rail, they decided not. They canceled the parking garage. The parking area. Was it Pearl City? Yeah. Okay. So we have the land area that was set aside.

I went to the.

That's the city's land. That's the city's land. But there are vacancies already, land acquisitions that you could already partner with. Because when you start accomplishing where you're going to put housing, you have to look at the mass area. Then you'll have to look at infrastructure. And are we going to buy those businesses?

You're going to relocate. So he's sitting on 100 million and actually considering more than that. And so if you're not going to do anything with it, then we can take it.

We do have plans to use for.

To Fund. Why don't you guys give us a list of how you're going to spend that total amount. Because if it's just sitting there, you know, we're talking about putting hold on tax breaks and you're sitting on cash, not doing anything, knowing that according to your own debate report, construction is an, is an economic supporter.

So you have that 100,000,000 that you're not spoken for, plus the other monies that are spoken for are not being spent. You got to get going. We have a housing shortage, no sense of urgency.

Another thing, the city and county is a partner of the TOD and the developments. That's their project, the real. So it should be a partnership as well. Chair.

Thank you, Chair. Just a follow up to some of the comments. Mr. Minakami. Do you guys have an infrastructure study project along Tilodi Corridor? Because I'll tell you, there's a few parcels in the district I represent along Skyline that I feel like the state hasn't had a sense of urgency and looking to develop that out.

And quite frankly, I feel the city and county of Honolulu in the latest years have done a concerted effort to buy out property and create housing units. So I don't think we should be behind the eight ball. I think this needs to be a priority as we look at housing.

Okay, thank you, Senator.

Thank you. Well, especially if you want additional resources. Okay, what's the next one?

The next one, Chair, is the ceiling for the stadium.

And I know you guys have been supportive. Yeah. But that's not going to happen. So until we can actually see what we talked about, there's still no point of the spear. We haven't been presented yet with a plan to say who's really in charge and then how all the different departments are, are organized or contracted to assist.

So when you guys, that can be at a later time, you don't have to get in because it's going to probably be a longer meeting.

We understand that. But the layout of the organizational chart and the structure has just been completed. So we will come to you and, and share that plan with you. It's been circulated to the Governor's office with Will Kane, the chairs, the Stadium Authority, and the chairs of the Stadium Authority as well.

So we will circulate that to you. And if I may, Chair, I will say that I, I don't try to micromanage the hda, but I can tell you this.

Between the House and the Senate, there are no, there are, there's only one organization or one Department that they talk, ask questions about to me, which is hta and privately you can ask any one of them, whether it's cnha, HBCB or hta. I don't micromanage them. Do I meet with them often, but I don't micromanage them.

And with hh, fdc, the Governor's Special Assistant to Housing is on it, the Budget and Finance Director is on it and OPSD is on it.

So I truly. They're administratively attached to you, though, not the other.

I understand that and you're absolutely right about that. But I have to make choices with our time. And I will tell you that I don't get. I get the most questions are about HTA and the convention center, which you can understand, but thank you for letting me know.

I don't micromanage either. I just have meetings just like you. All I do is have meetings just like this. Okay, so that's your definition.

That's my definition.

With regards the same table 6 with regards to the stadium. So this particular position and the allocation is that contract only. We're talking about the stadium, but not the additional plans, the future for the housing, surrounding areas.

It's kind of confusing because in our previous discussions it seems like we're talking about the stadium and we all also have been talking about the housing portion.

Yes. So let me just say that when we TBAD was given the money, the 300, $350 million to develop a stadium, we weren't given the resources. We were fortunate that Brandon Morioka, who is an engineer and was the chair of the board, was there at the time because if not, we would be way, way, way behind discussions.

What I'm saying is that to me, the stadium has been most important, I think, to people and not the housing portion. And as far as I'm concerned, I think we really should look at questioning, questioning why we're developing so many housing projects.

To me, I think we defeated ourselves when we dropped the seating arrangement down to 23,000 seats or something like that to that effect.

And people are waiting for the stadium. Part of the thing is if you're going to redo infrastructure, you might as well redoing it for something comprehensive versus like you're going to go into the stadium and then later on you're going to dig everything back for housing.

So you have to plan it simultaneously. Well, the question is, it seems like in our previous discussions, they still don't. Know what the sewer capacity is. On top of that, we're not even settled on on the housing portion.

Well, do we have. You can't tell the Housing component. You can't tell what it is until we get the infrastructure capacity, which we haven't received yet.

And I understand we're already demolishing the stadium. So what's the next phase right after that?

That's why it's important to have a point of the spear. Exactly. Because there's too many people involved, too many different departments, too different.

It's, it's. And we appreciate your meetings with us to help develop the path.

I'm serious. Yes. I don't. We don't micromanage.

We just have meetings. Well, truthfully, in Hawaii, I think we're more sports educated and want our stadium. I think you're both right.

There's everybody who wants the stadium and there's certainly Governor and this Committee that want housing and the housing chair want housing too.

So send concerts. You can make your money. Yes.

25,000 seats. Yeah. Since we're talking about the development from the city, about the solar capacity. So do we know. Because we're talking about housing and infrastructure. So how are we going to. If we don't even have the information from the city saying that we can do 3,000 homes, 4,000 homes.

Do we have that? Yes, yes, we do. I don't have it with me right now. I'm not sure if you have it, Mike. Okay. Yeah. So. And we want to introduce Mike Yadao, who is formerly a Stadium Authority Member, which is now the deputy Director of Stadium Operations.

No, thank you so much, Director. And thank you, Senator, for that question. We, we've literally, before coming into this meeting, walked out of some meetings with the Board of Water Supply and some of our city counterparts and they're mocking up what that would look like for 4,500 home development.

And so we're working backwards from we've given them the target numbers and they're giving us numbers on water capacity and on sewage and what kind of infrastructure we need specifically.

So we are working with our city counterparts and those are ongoing. And then we gave a number.

You gave them a number? We gave them a number. We gave them that 4,500 homes with mixed use retail and the rest. And now they're working backwards to make sure that they have that capacity. Thank you.

They even ask questions just for information, Senator, on ensuring that, that those homes were in full capacity and not investment properties because that's changes there models. And so it was pretty in depth and we expect to see some results in the next couple weeks. Thank you. Thank you, Chair on the cfp.

Shall we. You have a question on which part? Just. Just to follow this up. Okay, yes, thanks. Are you guys open sort of collectively? Everybody's been kind of funneling through the table here for the last five minutes on, on TOD stuff and as well as the special districts.

Are you guys available in the next couple weeks for deeper in depth informational briefing just to kind of get in the weeds on a lot of this? Because I think to the Chair's point, there's an opportunity this session if we're not asked what, what the needs are and for help to fill those needs. Right.

You, you're just going to keep spinning your wheels with what you have. I don't mean to single you out, I just mean collectively kind of in General amongst all the agencies, departments and everything. So if we can get to the bottom of kind of where things are at right now, then we can better help figure out. Right.

How do we leverage the dollars we have, how do we implement the new strategies to really stretch those dollars, best practices elsewhere, which often I think are not present in Hawaii yet and really get in the weeds so we can, I think with the other chairs set up some of those conversations.

I think to answer that question, Senator, the short answer is yes, absolutely open, absolutely willing to have those kind of discussions in a public forum.

There are obviously some things that are currently still under negotiation with, of the master development agreement and the ground lease that I can't speak to specifics because we're negotiating them with Aloha Halava Development Partners, but we're hoping to wrap that up in that early February time period.

So yes, and I think to Chair Del Cruz's comments earlier, we, we, we deeply appreciate that the project has been kind of muddied by not knowing necessarily who the tip of the spear was and allowing for service providers and consultants to be too involved in the decision making process.

And we are doing our absolute best at the stadium authority to assert that we are absolutely the tip of the spear and the sole authority in charge of that 98.5 acre development. To that end, we are doing our absolute best on the consultancy side to trim some of our communications.

We've had an overlay of consultants there that absolutely can be trimmed as Aloha Halawa Development Partners has their own communications firm and we have in house communications.

We're also looking at trimming, have already started the process of trimming a lot of our legal fees with o' Melveny and omm because we expect to be wrapped up with the negotiations in that February 1st time period or that should be past February 1st.

We believe that we can continue with local council and not need that kind of support from a mainland legal consultant. So we're, we're trying our absolute best in the short time I've been here to be responsive to that, that criticism. Senator.

We feel it's fair and we would like to assert our place as the authority much better than we have in the past.

I think we appreciate that. I just want to get the various agencies all lined up at the table to make sure that if there's going to be a lead and it's clear that everybody's on board with that and all the resources can be kind of planned accordingly.

So we'll follow up. Yes, Senator. And it probably needs to be MOAS so that we know which, what each role is for the different departments because we still haven't really got into down.

To HCDA's role and we're happy to help clarify that.

And there are tools we can put in place to really provide additional authority, additional opportunities to be able to streamline some stuff or leverage resources from other departments to be able to do some of the things, basic infrastructure and stuff that would ultimately reduce costs on the housing side of the equation, which to my knowledge hasn't been looked at yet.

I deeply appreciate that, Senator. And we can move forward with a better description of kind of who's in what spot and who's advising how ensuring that the stadium authority is the tip of the spear and leading the development.

We, we know that in order to ask for that ceiling to be removed in the 495 that we have to demonstrate that we've been good stewards of the money that we have thus far and that we have systems in place to ensure that. And so we appreciate your support and your willingness to have the discussion.

Thanks Stadium. I mean, the state is lucky to have you in your capacity there, Mike. Thank you, Shanda. I have a question and follow up to Senator Favela's question. Instead of having the Board of Water Supply talk about can you meet the 4,500 number housing allowance, maybe you should have a broader discussion.

Just ask the Board of Water Supply, what is the total capacity for this area? Because there are some who believe that it should be north of 40,500. So if you can kind of like here's the maximum allow, then we can dispel some other people's beliefs that there can be north of 10,000 units there.

So instead of just saying can you meet 4500, ask what the capacity is and then we, we, on a policy level can adjust accordingly with our discussions.

Absolutely. Senator, I take that as a friendly reminder that rather than limiting the numbers to be much more expansive in our, in our view, and we can revisit that with, with Ernie, with the Board of Water Supply.

Yeah, but it's also supposed to be with environmental services. Yes. Because there's probably less capacity for sewer than there is for water. You're, you're, you're absolutely right. We got to figure out this out. But I didn't even figure it out before we even put a dollar in.

But I, you know, I, I, I, I fully received that, Senator, and accept that criticism. I think what I want to assure you is that those conversations are now occurring and that we hope. Okay, well, they need to occur before we determine about 49.

I fully understand that and they will. Senator. Yeah. When we're talking about water, just to say that I was on Governor Ariyoshi state policy plan that developed the Hawaii state plan.

And let me tell you, when we worked on the water plan and this is now in the 70s now Honolulu and the airport, that entire region, when we looked at water services for the regions of Oahu island, the airport area was the lowest water table.

And we were very concerned about that and Governor was very concerned about that as well.

Now with the increase, and that's why for me, when we look at the additional housing for the stadium part, I have historical background because of the nature of the entire region of the airport, which included part of Kapalama all the way to Salt Lake area.

So that's why for me, with the housing increase, to me, I think we should be really concerned and that getting the information from Border water supply, and don't forget now the one responsible for those functional plants, which is 12, is with CPH with Mary Ellis's. She's redoing, they're redoing the state plan.

So it's kind of important that we get that taken care of and address how we're servicing the water area and how much.

Absolutely, Senator.

Senator Hashimoto, thank you for that reminder, sir. Okay, so, Mike, I guess can you give us clarity on what do we expect by February 1st?

Thank you.

So by February 1st, knock on all the Wood, that we anticipate having a fully negotiated master development agreement with Aloha and.

I'm sorry, agreements. Agreements.

Now you have it into five ground contracts versus one. Yes. With, you know, rental payments and ground lease and sublease and everything worked out. So how confident are you that that's you're going to hit that deadline. I, I am confident that we will have a majority of issues resolved by February 1st.

Whether or not the legal work, the, the specifics of the language can be fully finalized by February 1st, I don't quite know yet. That may extend into March, but not past March. Okay, so, so more realistically March then. I, I, I, we are shooting for a February 1st end time on the contract set.

So now is taking accountability as a stadium authority who is stress testing the contract. Are you guys still, you know, making sure that it's just consultants?

Are you guys bringing yourselves, trying to understand what's going on with the contract? So we are absolutely involved in and doing our best to understand the contracts. We have board Members that have a wealth of experience there with Walter Damis from Kamehameha and others that are also looking at the contracts.

We're also making sure that we're maximizing the AG's capacity so that they're looking at the contracts and that we have local council. I think the most expensive piece on the legal side was the mainland council in o'. Melveny.

And that is the piece that we are looking at getting out of the pot, so to speak, as of February.

So you guys are looking at all assumptions because my understanding is when you take a look at some of the assumptions, it's, it's, it's, you know, I think it's looking like it's, it's too rosy. And I think the reality is it's might be hard to actually make work.

But I don't know, I think that's what we rely on the stadium authority to make sure that you guys are actually knowing what we should be, you know, negotiating and what should be the actual reality based on figures. But that, you know, I think that was based on your contractor. Right. Who came up with those figures.

But I don't know if anyone on the stadium authority is actually checking them. Yes, and, and so we are questioning assumptions. We're, we're really. And they should be staff, not just board Member suits yet. Not board Members.

We absolutely have staff and we have, you know, we're very blessed to be administratively attached to dbed who also offers a tremendous amount of support.

But we're doing our best. Okay. And then, and just moving on another topic. So we're still at 4,500 for the units then?

I'm sorry, we're, we're still at 4,500 on the number of you house. You know, I, I do take Senator Wise counsel at asking the board of Water Supply to be a little more expansive in their view. But the numbers that we've been quoting to the Board of Water Supply and others have been 4,500 thus far.

But we are absolutely open to bigger and broader discussions.

Best Senator, if I can add to. When you talk about stress tests, I think we're very, very fortunate on the board to have the different expertise that are there, like Walter Land Use, Brannan Engineering, Andrew Communications and ERIC Finance.

But they have to do it in a way that's certifiable, you know, because it just can't be. As a board Member, this is what I think.

Right, right.

I mean I think what he's asking for is professional data that's going to allow us to make good decisions. But my point to that is these mobile board Members that I talked about will be able to circulate the questions to whoever it is, attorneys and consultants to do a stress test that of what you're talking about.

Okay, so where's the university and all of this?

The university, Matt attends all of the meetings. You know, it's our stadium. But they give a lot of. They give input to the games and everything else. But as far as the development and the construction, that's.

They're not. Why not?

Because they're the only ones that really are doing P3s for the state that successfully. I. Well, the. I cannot answer for them, but I think that, you know, Matt's. I don't know if that's his expertise and, and no one else as far as I know, has been talking. Well, Brennan is uh.

So you know Brennan, but he's not developing for uh. Where's all the developers.

Partners. I have to get back to you on that question, Senator, but does the. Uh, representative communicate with the President and the Board of Regents?

Because at least it's not going to be in a vacuum. Yes, Senator. The, uh, representative does communicate and he has also solicited our current board chair, Eric Fujimoto to help him communicate. You're copy. You're copied on that or you. I was previously when I sat on the board.

I, I have yet to meet with him in a couple of weeks that I've been on the job. But I was previously. Yes, and I know that what I've been hearing. But I know that Eric has had multiple meetings with different Members of the Board of Regents.

With Matt. No, I'm talking about a formal document that says this is what happened at the last board meeting. This is what UA should be doing. This is how you. I mean it should be this is all like we're making it up. Can we.

Can we actually have something formal that we can document?

I apologize. Have a paper trail. And we can do that. We can. We can suggest that to Matt as a board member that he report in that capacity.

Why do you have to suggest that? That's his job.

Fair.

Excuse me, Deputy and Dane, let's go back to table 15 and look at the CIP program. My question that we didn't get to yet, I see $10 million for seawater pipeline removal. Hawaii. Is that Nel, huh?

Yes, that is.

And why now? The development for that region, as we all know, was successful because of the seawater that's creating all those small businesses. Why are we removing or are we replacing it and making improvements with new pipelines which is greatly needed. So why are we removing?

The understanding this pipe is dilapidated, is.

No longer in use. Part of it ended up in the ocean and then well, aged.

I know because we created NELHA at that time, years ago, back in. I think that in the 70s. Thank you.

Yes, thank you for that question. Laurence Sombardier, I'm the Deputy Director at NELHA, filling in for our Executive Director today.

Welcome.

Thank you. So the 10 million is for abandoned pipelines from a company that was called Ocean farms from the 1980s, 1990s. And those pipelines are not in use. They were not the state's. They were not the state's responsibility. But the company went bankrupt and left the pipelines in the water. And we have since been dealing with this.

Okay, but it's not the pipelines that are currently serving those businesses there?

Okay, so those are still functional with that water system. Okay, so now the $10 million is to hire then these new business, the contractors to do the removals?

That is correct.

That is correct. And maybe I'll introduce here Dr. Alex Leonard, who can provide some details.

Thanks. Aloha.

Aloha, Senator. Yes. So about three. Three years ago, the Legislature appropriated money to allow us to survey the location of the buried pipe of the. Of the defog pipelines and to develop a series of recommendations and plans for their eventual disposition to mitigate. To mitigate the risk posed to the public environment.

That work has all been completed now. There are plans in place. Recommendation is that the pipes should be removed rather than abandoned in place and that they should be removed fully as soon as possible before any more mishaps occur. So the plans are ready.

The project, other than other than permitting review, is shovel ready and we're ready to.

It's been a while since it collapsed and you know, with age, I guess. But I. It's just the questions. The next one with regards to the $1.6 million for the park repairs and improvements for the hose park.

That's for Senator, that's for a variety of projects. We have some critical deferred maintenance that needs to be taken care of in order for us to continue our regular operations.

So we have is that infrastructure or.

Yes, so it's, it's. It's items like roadway paving, security fencing around critical, critical areas for public safety and electrical infrastructure. That's now how was the current facilities at neha are over 40 years old, some of them. And so the electrical infrastructure is beyond its useful life.

Sitting in the marine near the, near the ocean where they do corrosion is a serious problem and there's a lot of damage to the existing electrical infrastructure that needs to be dealt.

The Japan company that did the water bottling, whatever happened to that business? And is somebody taking over that facility?

Sure. You're probably referring to Koyo Usa. Koyo is still in operation and as far as I know, they're not going anywhere. We did have a total of five desalination companies. Of those, only two are left Koyo and another one is still. Koyo is in operation. Well defined, doing well. All right, thank you.

Do you have reports on the economic impact that you make to the state?

Yes, we do. So about every four years since 2010, we've been hiring you H Hero to do third party reporting on economic impact to the state. The last, last one was in calendar year 2022 and the impact there was 147 million to the state economy to the state itself from get tax and income tax from the businesses.

That adds up to 7 million in that calendar year 2022.

Okay. Because you know, if our, our budget is about, I mean at least General funds, 15 billion and you're only bringing in 100 million. So you guys to me are really underperforming. I mean you have to be a lot more proactive.

You know we're trying to, we've talked about diversifying our economy and I really haven't got that sense of, you know, I don't know promise or the ability to really take. Take control of. Of of what you guys are doing now. Diversify it so that it can have a much higher economic impact.

And do you have a goal to say, zero, our economic impact. We want to reach 500 million. Before. I respond to that doing same old same old.

So we are self sustaining agency.

No, that's not the point. All of our. I asked the question what do you have a goal of what economic impact you're trying to reach a 100,000,000 a million, whatever the case may be.

We don't have a goal currently, but we are in the process of going through a master planning effort that will and will update our economic projections for what the park will be providing. I don't have that number for you right now.

Well just to add here because I've been involved with NELHA at the outset back in the summer 70s. Now there's a problem because the goal like let's look at that Abalone company. They were doing so well.

We're talking about ag. See their statute is way bigger than AG and they haven't done it even.

Help and help them to survive because they were doing so well. And then later on there were all these issues about the lease.

It's natural energy laboratory, you know, natural energy not. It's not supposed to be an egg park natural energy laboratory. So you guys are supposed to be doing a lot more with, with tech and energy.

But that's not the case that were. There and no longer there.

So that's. So just.

Just a note then to the director if you can have each of your agencies since you like to have meetings with them to make sure that they all have goals because they need a goal of what kind of economic impact they want to make so that they can be a lot more aggressive in some of these projects.

But a lot of the agencies now are just doing the same old, same old coming before us and they're saying well we're self sustainable so you can't, you don't need to touch us. But they were created to diversify our economy and some of them are majorly underperforming.

So just like jump back real quick. So you know the dead seawater pipeline removal. So you know when you guys bringing these companies into there, don't you guys have like on contract that, you know, you put the stuff up that they got to put money down for the removal.

It's kind of like what we dealt with with the telescopes. You guys tried to incorporate that in some of your contracts instead of putting it on the backs of the taxpayers.

Correct. So we do have a clause in the sublease that requires a performance bond. That performance bond though really just covers lease rent for call it a year. So we don't have currently a performance bond which is I think what you're suggesting.

It would make a lot of sense for those companies that put in infrastructure that has the potential of being left into the lap of the state. We don't currently have that.

So I think you guys should. You guys should start considering that. Absolutely. I mean, you know, they should be putting up their fair share, they are. Receiving revenue while the state is having to clean up a lot of the mess that is left behind.

Can you just do that? Yeah, absolutely. This is the very first company. It was in the 80s, way before most of our times, collective times here. I think it was their first commercial venture of the state and it went bankrupt. And so that's the challenge when the companies go bankrupt. It's hard to recoup.

You doing before they go bankrupt? Yes.

Yes.

Senator Kim, you go into different tables. Yeah.

I have a question on Table 15, but not related to this. Okay, why don't we go see. Yeah, real quick, table 15, this is convention center. The 81 million you have appropriated. So that's all, Is that all for the roof? I know there was a previous lapse rate from a previous appropriation.

Is that all the money you need for the roof? And what other improvements are you making at the convention center?

Terry? We're going to call up Terry Orton, who's the General manager of the convention center. And Talent Kishi, who's the interim finance vp. One person can sit on that side.

And I don't know if this question was asked earlier, but I think it would be helpful to know timeline wise of when Convention center will be temporary closed during the roof repaving project and. When it will be sort of reopened.

Terry has all of that information.

Thank you. Good morning. I'm sorry, I missed a question. Could you repeat that again?

Sorry about that. Pay attention. You guys are all sitting over here.

Pay attention.

Sorry about that.

Okay, so the 81 million that you have projected in two different sources of funds on Table 15 for Hawaii Convention center improvements, what type of improvements do those cover? Does that uncover the roof replacement? Because previous funds were lapsed, I believe. And then what is the timeline for repairing the roof and how will that impact operations?

And coming back online.

Aloha. Good morning, Senator Dela Cruz, Senator DeCoite, Members of the Wham EDT Committee, my name is Talon Kishi, Acting VP of Finance. Thank you for the opportunity to share with you folks. So the 81 million dollar request, that's primarily for just other repair maintenance projects not related to the rooftop terrace deck project.

But just to clarify HTA's request, I am reducing the $60 million CIP request down to $34 million. So all together, we're asking for $55 million for you.

Provide a breakdown to the chair and the Committee of what those projects are.

Sure, we can do that for you. So yeah, I don't understand that. So does you. Who approved the 60? The Administration did. Zero, so the board had nothing to do with the 60?

No.

So that's the process. Now the board doesn't have any input.

On the CIP requests as of right now. I didn't know.

Okay. And then the, the reduction, who approved that?

That was HTA leadership with council, with HCC management. So I can explain the reasoning for the reduction. So the main concern I had was having enough money for both the Terrastec project and then our other repair and maintenance projects for the convention center. And the other repair and maintenance projects are primary.

My estimate was based off of the six year CIP plan. So we have a six year plan for the convention center. Long list of projects. It goes out six years. So I was trying to secure what I thought was enough funding for that six year plan for the next two years, 27 and 28.

But after speaking with Terry Orton, she said that Talon, you know what, let's lower the request down. Let's be a little more conservative and let's give them a list of projects that we feel are, we can be confident in completing by November 2027.

And we could always come back to you folks for more money if we need the additional support. So I agree. I think that was a much better plan than saying sitting on top of some money. We would never want to do that. So that's why we're going in with the $55 million request.

Okay, so that was just internal. There was no public discussion on any.

Of that follow up. So at the last meeting we had at the convention center, you folks said that originally the cost was 51 million. Right.

To do the roof, it was 51. Million based on the one year project. Right. The original budget at 64 million.

Correct. Okay. And then you. And then, but you folks budgeted, you ended up putting 64 million. Right? Correct. Okay.

And now the costs have gone up to 87 million. Is the construction costs compared at two years compared to the one year budget at 51 million.