Hawaii state senators are demanding to know how much and how long the state will have to pay for hotel rooms for Maui residents who were displaced by the Lahaina wildfire, and what impact the escalating fire response costs will have on the state budget.

In a sometimes tense hearing before the Senate Ways and Means Committee on Thursday, lawmakers grilled state Budget Director Luis Salaveria about when Gov. Josh Green’s administration realized that temporary shelter costs for people displaced by the fire were spiraling out of control.

They also wanted to know why the Legislature wasn’t warned sooner that the state’s obligation to fund the wildfire recovery effort this fiscal year has apparently more than doubled from the original predictions.

“We are bleeding right now, and it needs to stop, and I understand it’s hard,” said Sen. Jarrett Keohokalole. “But there’s no level set by the administration what the cost is to the rest of the operations state government if we don’t get this under control right now.”

The Green administration originally earmarked $199 million in the Major Disaster Fund to cover the wildfire recovery expenses for the fiscal year that ends June 30. But it now appears the state will need to pay out far more than that amount in the months ahead.

Salaveria told lawmakers last week the disaster fund is short about $350 million this fiscal year.

The Green administration has told lawmakers a request for that money is coming, but have not said exactly how much money will be involved. Salaveria said the latest estimate is the administration needs an emergency appropriation of $412 million to cover wildfire related costs this fiscal year.

That sum includes $65 million for the state’s share of Green’s One Ohana fund, which will be used to try to resolve claims by survivors of those who died or people who were seriously injured in the Aug. 8 fire.

Of particular concern to lawmakers is a $500 million contract the state signed with Red Cross to provide shelter, meals and other services for fire survivors. That deal is costing $1,000 per day per family for people staying in West Maui hotels.

The state originally expected its share of those expenses would be $50 million, but the Federal Emergency Management Agency has so far declined to pay many of the costs. Data provided by Salaveria shows the state now estimates its obligation under that contract is more than $247 million.

But Salaveria said that number changes constantly as the state negotiates with FEMA.

One major disagreement has been over who is eligible for FEMA support, which determines whether FEMA will pay 90% of the cost of their hotel stays and other services under the Red Cross contract.

Lawmakers were told on Feb. 20 that 820 households were deemed to be FEMA ineligible, while 1,150 families sheltering under the Red Cross contract are FEMA eligible for FEMA assistance.

Given the $1,000-per-day-per-family contract with Red Cross, disagreements over who is eligible is driving much of the unexpected cost of the fire response.

Hawaii Emergency Management Agency Administrator James Barros on Thursday offered a new estimate of how many families may be ineligible, telling senators that new calculations suggest only 659 families will be the state’s responsibility.

However, Barros also said that 659 number is constantly in flux as the state negotiates with FEMA over who is responsible for sheltering those families and individuals.

The ineligible families and individuals include undocumented noncitizens, people who were homeless before the fire and 20 families from Micronesia, according to the HIEMA presentation.

“Last week the number that I was confident the state was on the hook for was 29,” Barros told the committee. “This week, we’re at 11 that the state says ‘We’re funding these people.’ Other than that, everything else is still in flux.”

FEMA has also been refusing to pay for meals for families in hotels, an issue HIEMA has also been negotiating with with the federal agency, senators were told last week.

Lawmakers wanted to know when the administration discovered the escalating potential costs, and Salaveria said many of the problems with eligibility surfaced during late January and early February after the Legislature had already convened.

Senators also questioned why the state has not offered tents and trailers as stop-gap ways to get people who were displaced by the fire out of the hotels. State officials told them the governor made the decision to not bring in trailers because of the cost.

Ways and Means Committee Chairman Donovan Dela Cruz complained that the administration seems to have no housing strategy, and is simply reporting to lawmakers how much is being spent on the temporary shelter program.

“We still need a housing plan, because the more we put into sheltering, that’s less we put into real housing and infrastructure,” Dela Cruz said.

Dela Cruz also questioned why the administration failed to place some kind of spending caps on state departments who responded to the wildfire emergency.

“What I think some of us are uncomfortable with is, we provide the emergency appropriation, and the culture of ‘Just let me know how much you’re spending’ is going to continue,” Dela Cruz said.

“That has got to stop. There has to be some safeguards in place telling each department, ‘This is how much you have, you’ve got to work with in it'” or make a formal request for more funding, he said.

Salaveria said the administration recently imposed a requirement that any fire-related expenses that the departments expect would not be reimbursed by FEMA must get the governor’s approval.

In all, Salaveria told the committee Thursday there has been a total of $2.1 billion in obligations and expenditures related to the Aug. 8 Maui wildfire so far, and he expects the federal government will eventually cover $1.5 billion of those expenses.

But senators pointed out the state is now in negotiations with the public workers unions for new contracts, and Salaveria estimated the state will also have to pay state workers an estimated $300 million in back hazard pay from the pandemic.

Keohokalole said the costs are “out of control.”

“This goes beyond you, and the fact is, we need the governor here to stop the bleeding before we’re going to really be able to provide answers to any of these hard questions,” he said.

Civil Beat’s coverage of Maui County is supported in part by grants from the Nuestro Futuro Foundation.