Hurricane Relief Funds Should be Returned to Hawaii Homeowners Who Paid Into It

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This Wednesday afternoon March 10th the State House will hear SB2124 RELATING TO THE HAWAII HURRICANE RELIEF FUND.

This is the popular understanding of the Hawaii Hurricane Relief Fund (HR fund) today:

‘”The fund was created after Hurricane Iniki to provide hurricane insurance for homeowners. Hurricane insurance is required by mortgage holders, but after a hurricane, providers don’t always offer it.” Erin Miller: Impact of hurricane relief fund raid questioned WHT030310’

The discussion on establishing the HR fund made clear that the HR fund was not hurricane insurance.

Many elected officials voiced concern about the states liability in the event of a storm with property damage and the expectations of homeowners who paid into and built the HR fund. Here is what many elected officials at that time said while creating the HR fund:

‘”…I oppose the establishment of the HR fund ………is not insurance….. So what if there is a hurricane and the fund has insufficient monies? Who gets it and when it is all gone what then?’

As it happens the HR fund is not insurance. The HR fund collections made little sense as the market had several companies providing hurricane insurance. It was not long before the annual mandatory HR fund payment was abolished. I fully expected that the fund would be closed out and the monies returned to the homeowners who built the HR fund

It was expected that the HR fund payments would be returned to the homeowners.

The decision to keep the HR fund and not return the payments was the position of then Governor Benjamin Cayetano. He stated that there is “no way to determine who paid into the Fund” so it would be “impossible to accurately” return the Fund monies. Further he said that the 28 full time employees hired to administer the Fund did such a good job that closing their department and making them redundant would not be a “good message” to send to the other state employees that are doing a good job too.

I had full value homeowners insurance (including hurricane) before the mandatory annual HR fund payment was made law. The HR fund collections made little sense and was abolished. It has been suggested that there is no accurate accounting of the HR fund. Records are incomplete.

Leaving the HR fund in SB2124 makes these statements true:

It is okay “not” to “return” the monies to the homeowners who built the HR fund.

It is prudent to redirect the HR fund monies.

It is acceptable to close and raid funds in these difficult economic times for sure.

Lastly I am aware that there are numerous other funds that are earmarked in the pending passage of SB2124. I support getting teachers back to work. What makes the HR fund monies unique is that it was collected directly from individual homeowners who built the HR fund for a specific reason and SB2124 is not that reason.

I think the cash the homeowners paid into the HR fund should be returned-with interest.

‘Patrick Walsh can be reached at mailto:patrick@hawaiiantel.net’

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