Mayor Richard Bissen made a new appeal to a key Senate committee on Tuesday for $401 million over three years to develop desperately needed housing on Maui as state lawmakers struggled to come to grips with wildly escalating recovery costs from the deadly Aug. 8 Lahaina wildfire.

Luis Salaveria, director of the state Department of Budget and Finance, confirmed the fire recovery costs for this year alone are expected to top $600 million, which is the amount Gov. Josh Green’s administration originally budgeted for the recovery effort over four years.

Those rising costs have prompted the Senate to ask Salaveria to develop contingency plans for imposing state spending cuts of 10% and 15%, and senators suggested that state grant-in-aid funding for nonprofit organizations may also be dramatically reduced.

Bissen reminded the Senate Ways and Means Committee Tuesday that the wildfire killed at least 101 people, and was the largest natural disaster in the history of Hawaii. It impacted some 10,000 Maui residents, and “today I am their voice, and we need your help,” he said.

Bissen asked for $401.75 million in additional state funding over the next three years to help rebuild Lahaina, which he said will be matched by $198.75 million in county funding. The money would be used for infrastructure, housing and emergency response needs, he said.

“Every day our people are leaving, and this is a consequence that I cannot make peace with,” Bissen said. “We must make our people whole again. We cannot do it without the support of the state.”

If the state does not help Maui, it “would set us back for decades,” he said.

Seeking A ‘Balanced Approach’

Senate Ways and Means Chairman Donovan Dela Cruz told Bissen lawmakers empathize with Maui residents but also need to measure the cost of the recovery and take “a balanced approach, because if we don’t have some handle on it, we won’t be able to help everybody that needs help.”

Sen. Chris Lee told Maui officials that “everybody here obviously wants to help, and on the state side right now we’re contemplating cuts to our state services and across-the-board budget cuts of as much as 15% in order to free up money to help you guys address this Maui situation.”

But he asked Maui leaders to demonstrate they are also making cuts in non-fire related county expenses so that the public will understand “we’re all eating it.”

“It would be helpful I think on our side, at least for me, because we’re going to have to sell this to the public. We’re going to have all the other islands that are going to be having priorities, projects, programs all cut back, potentially,” he added.

Dela Cruz and Ways and Means Vice Chairwoman Sharon Moriwaki issued a memo last week that alerted their colleagues that the costs from the Maui recovery have been accumulating far more rapidly than Green’s administration initially expected.

“The costs are much more than expected, and if we continue at that rate, we’re going to have to look at all of the departments’ budgets.”

Sen. Sharon Moriwaki, vice chair of the Ways and Means Committee

The state has been incurring about $1 million per day in costs to shelter Maui fire survivors — including many who remain in West Maui hotels — and it appears the state may not get as much federal reimbursement as the state anticipated, according to the memo.

State officials knew they would need to cover much of the cost of temporary housing for fire survivors up front, but the Green administration expected some 90% of that cost would be reimbursed by FEMA. In fact, lawmakers report that FEMA has been rejecting large numbers of claims for reimbursement.

The public briefing on Tuesday detailed a variety of categories assistance being provided by the federal government, and Salaveria said the total obligations and expenditures so far have reached $2.1 billion. The state’s share of that as of Monday is about $551 million, but that obligation is constantly changing, he said.

Reimbursement Concerns

State and federal obligations for federal operations support and direct federal assistance are at about $1.2 billion so far, and the state’s share of that thus far is $114 million, he said.

The total federal public assistance has cost $175 million so far, of which the state share is $17.5 million, he said. And Salaveria said state departments on their own have incurred another $44 million in fire-related costs, but did not say how much the state expects to be reimbursed for those items.

Much of the discussion focused on a $500 million contract with the American Red Cross for shelter for residents displaced by the fire, which includes meals and “wrap around services” for those families that are sheltering in hotels.

The state had expected it would have to pick up just $50 million of the cost of that contract and the Federal Emergency Management Agency would pay the rest, but that isn’t happening. Salaveria said unless something changes, the state share will be as much as $250 million through the end of June.

The total state expenses to date have far outstripped the nearly $200 million the administration set aside in the Major Disaster Fund for this year, he said.

That means the administration needs to ask lawmakers for an emergency appropriation, which the committee will consider in a hearing at 9:30 a.m. Wednesday.

“The costs are much more than expected, and if we continue at that rate, we’re going to have to look at all of the departments’ budgets,” Moriwaki said in an interview. “If there are cuts to be made, it would be for the administration to say where and what, and we are just looking at being prepared.”

“We would hope that the administration, the governor, would be looking at this and sending down to us a more reasonable and thought-out budget based on the new figures that are coming in from the Lahaina costs,” she added.

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