Hawai’i lawmakers propose a significant shift in the way school funds are sourced from housing projects, nearly twenty years after the legislature enabled the Department of Education (DOE) to collect fees from housing construction. Initially designed to fund new or expanded schools to accommodate growing student populations where new housing is developed, a 2007 law allowed the DOE to collect such fees. Despite having amassed $20 million over the years, these funds have remained untouched.
Critics, including Lee Wang, Executive Director of Housing Hawai’i’s Future, argue that collecting fees with no subsequent utilization is ineffective. Wang’s organization advocates for abolishing what is known as the “impact fee.” The DOE claims that spending restrictions have made it challenging to utilize the funds, as the law demands that money raised be spent within the community from which it came. However, funds from individual developments are often insufficient to cover new school expenses.
Originally, fees could only be used to construct a new school or expand existing facilities, excluding temporary solutions like portable classrooms. Amendments in 2021 broadened the scope, allowing funds to be spent on renovations and temporary facilities, yet stipulating the same local-only spending requirement. Despite these updates, the funds remain idle, prompting lawmakers to consider removing the fees entirely.
Sen. Troy Hashimoto expresses concerns that these fees, typically between $2,000 and $5,000 per home, raise construction costs and compound existing housing affordability issues without actually being disbursed. The dilemma now heads for deliberation in a joint Senate Education and Ways and Means committee meeting.
Arjuna Heim from the economic justice advocacy organization Hawai’i Appleseed stresses that while fee collection strains individual homeowners financially, it fails to generate substantial revenue for new school construction due to insufficient large-scale housing developments. Most contributors to these fees tend to be individuals or small developers, thus diminishing their potential impact.
While the Department of Hawaiian Home Lands (DHHL) projects demonstrate potential revenue generation from fees, such as $1.6 million from a $53 million project in ?Ewa Beach, these amounts pale in comparison to the expenses evidenced by the $245 million construction of a Kihei high school.
Fees unequally affect different regions, sparking claims of unfairness. Legislative assessments have critiqued their haphazard imposition methods and inconsistent policy application, leaving many arguing for the removal of these required payments. Uchida from the DOE contends, however, that the fees standardize developers’ contributions, ensuring resources for educational infrastructure in growing communities.
State Rep. Luke Evslin, who proposed the bill to eliminate the fees, suggests that counties and the Land Use Commission could demand contributions from large developments through zoning regulations, thus still involving developers in education infrastructure funding.
Board of Education members remain divided. Concerns persist about ensuring schools can cater to their student populations amidst fluctuating enrollment rates, which have decreased statewide by 13%, although they rise in places such as ?Ewa Beach and central Maui.
The bill proposes transferring the collected $20 million to the School Facilities Authority, albeit subject to legislative approval to ensure funds are spent within the respective communities. ‘The process to spend is very, very complicated,’ states Riki Fujitani, underscoring the procedural hurdles faced with existing legislation.