Aloha students, faculty and staff,
The Hawaiʻi State Legislature is now in its final month of the 2024 legislative session. Legislative measures are nearing their last phases of deliberation, and bills (those that are still alive) are set to return to their originating chamber soon as the ‘second crossover’ milestone approaches.
For the State budget, the Senate recently completed its version of the budget, and will be sending it back to the House where the conference committee process could begin as early as mid-April. The House had completed its version of the budget earlier in March, so the conference committee meetings will be the opportunity for both chambers to reconcile, compromise, or negotiate the final state budget. This update provides some updates on key funding requests of the University of Hawaiʻi in the Senate draft of the budget.
If you recall my update from March, the House draft of the operating budget reflected all of the University requests that were included in the Governor’s requested budget. Although still slightly off from what the Regents had requested for the University, the House had included all of the Governor’s requests, plus more. By this measure, the Senate version of the budget is not as good as the House version but I would still characterize it as decent.
The restoration of public funding to pre-COVID-19 pandemic levels is one of the top legislative priorities for UH this legislative session, along with expanding the Hawaiʻi Promise program to the three four-year universities and funding to address healthcare workforce shortages.
The Governor and the House both supported the Board of Regents request to permanently restore public funding to UH to the level that existed prior to the pandemic. The Senate draft does include the restoration of the funds as well, but only for the next Fiscal Year (FY2025). This is the same funding approach as last year—where the Legislature restored funding for only the current year, FY2024.
Restoring funding for services and programs that have previously existed for more than 5+ years from before the pandemic on a year-to-year basis is not fiscally rational and impedes the establishment of consistent operations and services. Getting the funding for another year is appreciated, but getting it restored makes the most sense. Prior to the pandemic in FY2020, the state general fund budget was roughly $8 billion, and is now projected to be about $10.3 billion for FY25, an increase of over 28%. In that same time period, tax collections and inflation have increased considerably. The University of Hawaiʻi and the Department of Education remain the only state agencies that have not had the funding that was cut during the pandemic restored.
Similarly, general fund support for athletics programs at UH Mānoa and UH Hilo are included in the Senate draft of the budget but, again, only FY25. If the legislature passes a budget with the Senate approach to these items as non-recurring funding, it is not fatal, but UH will have to once again request general fund support from the Legislature next session in both of these areas.
The following table shows a synopsis of how UH has fared so far this session on the operating budget:
OPERATING TABLE
| Campus | Description | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| BOR Request | Governor Request | House | Senate | ||||||
| FTE | $$$ | FTE | $$$ | FTE | $$$ | FTE | $$$ | ||
| UH Mānoa | General Fund Restoration – UH Mānoa | $5,600,000 | $5,600,000 | $5,600,000 | $5,600,000 | ||||
| JABSOM | General Fund Restoration – JABSOM | $1,800,000 | $1,800,000 | $1,800,000 | $1,800,000 | ||||
| UH Hilo | General Fund Restoration – UH Hilo | $3,420,000 | $3,420,000 | $3,420,000 | $3,420,000 | ||||
| UH West Oʻahu | General Fund Restoration – UH West Oʻahu | $1,620,000 | $1,620,000 | $1,620,000 | $1,620,000 | ||||
| UH System | General Fund Restoration – UH System | $5,086,848 | $5,086,848 | $5,086,848 | $5,086,848 | ||||
| UH Mānoa | Athletics Subsidy – UH Mānoa | $3,200,000 | $3,200,000 | $3,200,000 | $3,200,000 | ||||
| UH Hilo | Athletics Subsidy – UH Hilo | $400,000 | $400,000 | $400,000 | $400,000 | ||||
| UH Community Colleges | Culinary Institute of the Pacific – Full Year Funding | $389,245 | |||||||
| UH Community Colleges | Value Added Product Center – Full Year Funding | $359,932 | |||||||
| UH Mānoa | Expand Teacher Cohort on Neighbor Islands | 7.00 | $625,000 | ||||||
| UH Mānoa | CTAHR Extension Agents | 5.00 | $506,555 | 5.00 | $506,555 | 5.00 | $506,555 | 5.00 | $506,555 |
| UH System | Increased Campus Safety | 4.00 | $1,000,000 | moved to TFSF | moved to TFSF | moved to TFSF | moved to TFSF | moved to TFSF | moved to TFSF |
| UH Mānoa | Hawaiʻi Promise Expansion – UH Mānoa | $12,506,711 | $12,506,711 | ||||||
| UH Hilo | Hawaiʻi Promise Expansion – UH Hilo | $1,773,579 | $1,773,579 | ||||||
| UH West Oʻahu | Hawaiʻi Promise Expansion – UH West Oʻahu | $4,026,116 | $4,026,116 | ||||||
| UH Community Colleges | Hawaiʻi Promise Continuation – UH Community Colleges | $3,700,000 | $3,700,000 | $3,700,000 | $3,700,000 | ||||
| UH Community Colleges | Community-based Planning for Redevelopment of Lahaina | 2.00 | $500,000 | ||||||
| UH Mānoa | Nursing Enrollment and Access thru UH Mānoa-UH West Oʻahu Nursing Collaboration | 6.50 | $1,068,821 | 6.50 | $1,068,821 | 6.50 | $1,068,821 | 6.50 | $537,546 |
| JABSOM | Neighbor Island Health Access and Pathway Extension | 4.00 | $925,000 | 4.00 | $925,000 | 4.00 | $925,000 | 4.00 | $925,000 |
| UH Hilo | MA Counseling Psychology | 3.00 | $210,000 | 3.00 | $210,000 | 3.00 | $210,000 | 3.00 | $210,000 |
| UH West Oʻahu | Pre-Nursing Support | 3.00 | $322,032 | 3.00 | $322,032 | 3.00 | $322,032 | ||
| UH West Oʻahu | Early Childhood Education Support | 2.00 | $180,910 | 2.00 | $180,910 | ||||
| UH Hilo | BS Educational Studies and Expand Indigenous Teaching | 2.00 | $285,000 | 2.00 | $285,000 | 4.0 | $142,500 | ||
| UH Community Colleges | UH Maui – Apprenticeship Training Expansion | $250,000 | |||||||
| UH Community Colleges | Leeward CC – Modernize Equipment | $925,000 | |||||||
| UH System | Systemwide Mental Health Services | 6.00 | $510,000 | 6.00 | $510,000 | 6.00 | $510,000 | 6.00 | $255,000 |
| UH Mānoa | Community Event Support | 6.00 | $709,000 | ||||||
| UH West Oʻahu | ACM Facilities and Core Services Support | 4.00 | $252,648 | ||||||
| UH West Oʻahu | Campus Safety | 1.00 | $61,800 | ||||||
| UH Community Colleges | UH Maui – Water Quality Lab | 2.00 | $160,000 | ||||||
| UH Mānoa | Stabilize UH Mānoa Athletics Operating Budget | 43.00 | $3,136,642 | ||||||
| UH Mānoa | Cooperative Extension Support | 5.00 | $581,555 | ||||||
| UH Community Colleges | Windward CC – Incarcerated Students Program | 3.00 | $250,528 | 3.00 | $250,528 | 3.00 | $250,528 | ||
| UH Community Colleges | Statewide Access Master Plan | $2,874,177 | |||||||
| TOTAL | 110.50 | $56,342,922 | 36.50 | $29,085,694 | 30.50 | $46,926,190 | 28.50 | $30,277,626 | |
*Items in red are non-recurring.
On the UH capital improvement projects (CIP) budget, the UH initial request was for $331.5 million for FY2026 to address capital renewal, progress on deferred maintenance and funding for projects to modernize each of the campuses within the UH System. The Governor included $66.5 million of the UH requested amount in his budget request. The House draft of the budget appropriated $223,450,000 while the Senate draft provided for $153,967,000 for capital projects.
While $153,967,000 is a significant amount, there are funding nuances where we would have to be mindful. The Governor, House and Senate all lapsed $101.2 million general funded CIP to UH for FY25. Forcing the lapse on CIP, is an approach to make available general funds for redeployment to other initiatives, such as those to address the Maui wildfire recovery. These UH projects and funding that are proposed to lapse included:
- $5,000,000 for Sewer Line Replacement/Upgrades at Coconut Island
- $16,200,000 for Renew, Improve, and Modernize (RIM) projects at UH Hilo
- $25,000,000 for Minor CIP at the Community Colleges
- $25,000,000 for Capital Renewal and Deferred Maintenance at the Community Colleges
- $30,000,000 for RIM projects Systemwide.
The Senate put some of these funds back as General Obligation Bond finance projects, which are listed on the table, but notably did not include $25 million for Minor CIP at the Community Colleges and only put $20 million for RIM projects, Systemwide. The total amount of RIM funding is $37.2 million, which is far short of the $80 million that UH needs annually to prevent the maintenance backlog at UH facilities from increasing.
Additionally, although $63.5 million was appropriated for Hale Noelani renovation, this amount does not appear adequate to reopen the student housing facility. If the funding for student housing facilities and/or Hale Noelani are at insufficient levels to address facility condition improvements, the University will need to explore alternative funding and capital construction approaches to address student housing needs.
The following table shows the current CIP breakdown:
CIP TABLE
| Campus | Description | BOR Request | Governor Request | House Draft | Senate Draft |
|---|---|---|---|---|---|
| System/UH Mānoa | System, RIM Projects | $110,000,000 | $20,000,000 | $125,000,000 | $20,000,000 |
| UH Mānoa | RIM Projects for Student Housing | $40,000,000 | |||
| UH Mānoa | Hale Noelani Renovation | $80,000,000 | $63,517,000 | ||
| UH Mānoa | PV Rooftop, PV Canopies and Various Energy Efficiency Projects | $30,000,000 | |||
| UH Mānoa | Waikīkī Aquarium Upgrades | $9,000,000 | $9,000,000 | $4,500,000 | $9,000,000 |
| UH Mānoa | Coconut Island Sewer Line Upgrades | $3,000,000 | $3,000,000 | $6,000,000 | $5,000,000 |
| UH Mānoa | Holmes Hall | $8,000,000 | $8,000,000 | $8,000,000 | |
| UH Mānoa | Assessment and Feasibility of Hamilton Library | $6,500,000 | |||
| UH Mānoa | Mini Master Plan, Phase 3 – Kuykendall Hall | $5,000,000 | $5,000,000 | $5,000,000 | |
| UH Mānoa | Central Administration Facility with Parking | $8,000,000 | $8,000,000 | ||
| UH Mānoa | Waikīkī Aquarium Seawall Repairs | $3,000,000 | $3,000,000 | ||
| JABSOM | JABSOM Roof Replacement | $6,500,000 | $6,250,000 | $6,250,000 | $6,250,000 |
| UH Hilo | RIM Projects | $7,300,000 | $7,300,000 | $16,200,000 | $16,200,000 |
| UH West Oʻahu | RIM Projects | $5,000,000 | $5,000,000 | $1,000,000 | |
| UH West Oʻahu | Road B Entry Plaza | $5,200,000 | |||
| UH West Oʻahu | PV Carport | $5,000,000 | $5,000,000 | ||
| UH Community Colleges | Major R&M | $10,000,000 | |||
| UH Community Colleges | Capital Renewal and Deferred Maintenance | $25,000,000 | $25,000,000 | ||
| UH Community Colleges | Pālamanui – Improvements and Repair of Buildings | $2,000,000 | |||
| UH Community Colleges | Pālamanui – Expansion of Nursing and Early Childhood Ed Labs | $500,000 | |||
| UH System | CTAHR – Poamoho Research Station | $2,000,000 | $2,500,000 | ||
| UH Mānoa | Waikīkī Aquarium – Edge of the Reef Exhibit | $3,000,000 | |||
| UH Community Colleges | Value-Added Product Development Center, Molokaʻi | $2,500,000 | |||
| TOTAL | $331,500,000 | $66,550,000 | $223,450,000 | $153,967,000 |
*Items in red are General Funded.
What happens next?
Now comes the final weeks of the session when the Senate and the House negotiate in Conference Committee meetings on the differences in their versions of the State Budget (HB1800 HD1 SD1) and other measures that are still alive. The outcomes of these meetings, which primarily happen behind closed doors, will ultimately decide funding for state programs, departments and agencies, including the University of Hawaiʻi ten campus system.
It is important to remember that there are never enough funds to meet all the requests of every state department—but, this year, that is especially true as the legislature and state believes that the situation is more dire in order to adequately provide for the recovery response to the Maui wildfires.
There are two major deadlines approaching:
- Monday, April 22, is the final decking deadline for the State Budget.
- Friday, April 26, is the final decking for fiscal bills.
By this time, all bills must have concluded deliberation in Conference Committees of both the House and Senate. The Hawaiʻi State Legislature is scheduled to adjourn on May 3, 2024.
I will send out my final legislative update for this 2024 legislative session after the university has been able to review and assess the budget passed by the legislature for its impact on UH.
Mahalo for your time and attention,
Kalbert Young
UH Vice President for Budget & Finance/Chief Financial Officer
