BY MALIA ZIMMERMAN – HONOLULU — Even though the National Weather Service released a forecast Wednesday calling for a below average hurricane season in the central Pacific, Weather.com reported Honolulu as one of five major U.S. cities statistically overdue for a direct hit from a hurricane.
The news came on the day that Hawaii’s hurricane season officially began, and the day after Gov. Neil Abercrombie authorized a $42 million raid on the Hurricane Relief Trust Fund.
He signed a bill transferring money to the general fund to “balance” the 2011 state budget, which ends June 30. Hawaii’s hurricane season started June 1, and all experts say it is not “if” another devastating hurricane hits but “when.”
The law authorizes the governor to transfer more from the trust fund and establishes a mechanism for the automatic replenishment of the trust fund from general excise tax revenues in from 2013 to 2015. The law also authorizes the issuance of revenue bonds by the Hawaii Hurricane Relief Fund to maintain a $75 million balance.
According to a study last year by the Government Accountability Office on natural catastrophe insurance programs in 17 other states, taxpayers have almost $3 trillion in exposure because governments are not adequately funding the plans as they pull accounting tricks to falsify balanced budgets. Hawaii was not in the study.
Its fund was established after Hurricane Iniki devastated many parts of Kauai and Oahu in 1992, and the mainland states were hit with severe hurricanes as well, leading to the withdrawal of the state’s private insurance companies from the islands.
The state created the trust fund, via payments by those Hawaii homeowners required to have insurance, to provide for reinsurance. However, the fund was never used.
The state legislature over the years eyed the growing balance in the fund and like so many special funds, prepared to transfer or raid funds into the state General Fund.
Pleas to return funds to premium holders who had paid into the fund were totally ignored. The Hawaii Realtors Association and others lobbied to maintain the fund for the next expected hurricane. However, several years ago, the legislature began raiding the interest in the fund to pay for various social and other programs, and then took significant amounts of the fund last year and this year to balance the state budget.
Should the state need to replenish the fund during a disaster, the state can impose a surcharge on existing insurers.