Group reviews economic, financial preparedness for Hawaiʻi following the pandemic
Honolulu, Hawaiʻi – The House Select Committee on COVID-19 Economic and Financial Preparedness held its third informational briefing on Monday, April 6, focusing this week on identifying “shovel ready” Capital Improvement Projects by island, looking into business insurance coverage during the pandemic, and hearing an update from the food industry.
The committee first heard a report from Carl Bonham, Executive Director of the Economic Research Organization at the University of Hawaiʻi (UHERO), on its new report: How to Control Hawaii’s Coronavirus Epidemic and Bring back the Economy: The Next Steps.
The report spells out in detail how increased testing, comprehensive historical contact tracing, and isolation of exposed and infected individuals can lead to a rapid reduction in new infections and hospitalizations. According to Bonham, once this system has been put in place and has operated successfully for several weeks, we may begin to approach several measurable targets—number of new infections, number of new hospitalizations, capacity of the health care system to treat newly infected or exposed individuals—that would enable Governor Ige to gradually relax his stay-at-home order and for individuals to gradually relax some social distancing restrictions.
Bonham said after the disease has been eliminated, the local economy will need to be reopened first, followed by the tourism economy. He said the worst-case scenario would be for the economy to reopen following the development of a vaccine in 12 to 18 months. A more optimistic forecast would be for the disease to be brought under control in about 45 days on the mainland.
Bonham said that when Hawaiʻi is perceived as a safe place to visit, it could become the premier destination for U.S. travelers over then next year, but that Hawaiʻi residents must be reassured that any tourists are coronavirus free.
The committee agreed that the state Department of Health plays a critical role in reviving the economy by providing information to the public quickly and transparently to build residents’ trust.
“This is going to be challenging for our whole community,” said Peter Ho, Committee Co-chair and President & CEO of Bank of Hawaii. “The three pieces of this are what are the protocols to know so that we can begin restaging the economy, how can we restart the local economy, and then rebuild the visitor industry. Clearly, there is an awful lot that has to be done to make this operational.”
State Insurance Commissioner Colin Hayashida then addressed the question of if business interruption insurance would cover business losses due to the coronavirus. Hayashida said that this type of insurance typically covers loss of income when a business suffers physical damage, such as after fire. For COVID-19 or pandemic losses, coverage would have had to have been purchased before the pandemic. Contaminated inventory or equipment may be covered, he said, but it would be written into the business owners’ full policy. He advised owners to contact their insurance agents and to email the Department of Commerce and Consumer affairs with questions at insurance@dccca.insurance.gov.
House Speaker Scott K. Saiki asked if any business had been successful in getting business interruption coverage so far and Hayashida said not that he has heard of.
“The problem is that in almost any context insurance can deny a claim. That should not be happening here,” said Saiki. “The insurance commission should help with those claims. That is why I asked if anyone has been covered yet.”
Lauren Zirbel, Executive Director of the Food Industry Association, provided a PowerPoint report showing that grocery store sales are dropping, layoffs are increasing, and that restaurants providing takeout meals are not nearly making up for the economic losses of full dining service. Grocery stores sales, she said, are down as much as 60 percent.
Zirbel encouraged families to only send one person per family on shopping trips to reduce the spread of the coronavirus and said more protective measures are being taken for essential food workers such as protective barriers.
Zirbel said the food industry's top requests are for more testing to limit the spread of the disease and for childcare to be provided for essential workers similar to what has already been provided in other states.
Sheryl Matsouka, Executive Director of the Hawaiʻi Restaurant Association, said she spoke with Governor David Ige recently and requested that restaurants be allowed to sell beer, wine and bottled spirits with their food sales. She said for some restaurants it could make take-out only more feasible.
Speaker Saiki asked House Majority Leader Della Au Belatti to follow up with the Attorney General’s office on the status of the request.
Dr. Mark Mugiishi, President & CEO of the Hawaii Medical Service Association reported that they are expecting the surge in local coronavirus cases to take place on about April 25. He said a top priority for HMSA is to make sure care facilities are properly resourced so that Hawaiʻi does not have supply issues like what has been seen in New York, Spain and Italy.
He said the HMSA has suspended preauthorization for coronavirus procedures and has waived all copayments for COVID-19 related services. HMSA will not terminate service for nonpayment of premiums in April and possibly May, has increased its educational efforts about its new service, and expanded its TeleHealth service for those in home isolation.
Representative Kyle Yamashita then gave an update of the “shovel ready” Capital Improvement Project list he presented to the committee last week. Yamashita said an additional $1.24 million has been added to the list, bringing the total to $2.8 billion.
The committee has supported CIP projects as a way to keep people working and boost the economy.
Yamashita said $348 million in CIP projects are planned for Hawaiʻi Island, Kauaʻi has $111 million, Maui has $216 million, Oʻahu has $1.8 billion, Molokai has $38 million, and statewide there are another $211 million in projects ready to go.
He said $1.3 billion has already been funded by the legislature and the remainder still needs additional information from the Governor’s office.
Mufi Hanneman, President & CEO, Hawaiʻi Lodging and Tourism Association, reported that the “Hotels for Heroes” program started today and will run through May 3. He said 33 hotels statewide are offering hotel rooms free of charge to state and county first responders and health-care essential workers. He said the program not only helps paramedics, firefighters, police officers or health-care workers who need to rest without the worry of spreading the infection to their families, it also provides much needed work for hotel workers.
Chris Tatum, President & CEE of the Hawaiʻi Tourism Association, said about 500 rooms have already been booked and the program might expand if needed.
Speaker Saiki said the next meeting, set for April 13, will focus on the recovery efforts to reopen the economy. He will also ask Dr. Bruce Anderson, Director of the State Department of Health, to take part in the meeting to discuss status of coronavirus testing, and State Adjutant General Kenneth Hara to discuss the implementation of federal stimulus funds.
To see committee documents, visit https://www.capitol.hawaii.gov/specialcommittee.aspx?comm=cov&year=2020.