I Miss Molly Ivins

I woke up this morning missing Molly Ivins.  I wish I could channel her right now to get her perspective on the absurdity of the 2010 political landscape.  But, she sums it up quite eloquently with this quote:

What stuns me most about contemporary politics is not even that the system has been so badly corrupted by money. It is that so few people get the connection between their lives and what the bozos do in Washington and our state capitols.

In my role as a “politician”, Molly Ivins grounded me because she always spoke the truth – that’s the power of a good journalist.

In this speech at Tulane University, Molly gives the most succinct civics lesson ever and her political commentary is probably more germane than anything you will hear tomorrow night.

Appointed vs. Elected Board of Education

I am voting “yes” on the appointed school board question.  Hawaii’s families need to hold elected officials accountable for our public education system, however, under the current structure it is very difficult to hold anyone accountable.  We can’t say we hold our elected Board of Education members responsible because most of us don’t even know who the BOE members are and many voters don’t even vote in the BOE races.  At least with an appointed school board Hawaii’s families can point directly to the Governor and the Legislature.

Several weeks ago I wrote about what makes a great school.  Here is an excerpt from that post:

Since 2002 the Lingle-Aiona administration tried to peg school reform on one issue, locally elected school boards. The Chair of the House Committee on Education, Representative Roy Takumi, has studied the issue of school reform extensively.  What is clear is governance of a school system (local versus state board of education) has little to do with successful schools.

Throughout the country, successful schools have these common characteristics:  (1) Principals with effective leadership qualities, (2) Skilled and dedicated teachers, (3) Involved parents and active community support, (4) An Articulated Curriculum, (5) A Safe and Healthy Learning Environment.  Using this framework, I have supported legislation that brought funding and decision-making directly under local school control, worked to reduce class size, add more money for textbooks and modernize computers and technology infrastructure, tried to address the teacher shortage by providing fair compensation to retain and attract skilled and dedicated educators, established a Principal’s Academy to enhance leadership skills, established and adjusted the weighted student formula to adequately address a student’s special needs.

Today’s Star-Advertiser story on this issue sort of misses the point.  It’s not about the BOE, it’s about the best structure that can support transformation at the school level.  Yes, there can be bad, political choices made for BOE appointees but, hopefully, there will be checks and balances to minimize that possibility.  The Legislature tried to address this concern but Governor Lingle vetoed the bill that would have set-up the statutory framework for the selection/appointment process in anticipation to the possible passage of the appointed school board constitutional question.  House Bill 2377, which I co-sponsored, would have set-up a selection committee using the Hawaii P-20 Council to submit a list of potential candidates.  The Governor would have to select an appointee from this list of candidates who are then subject to the advice and consent of the Senate.  This process is similar to the Judicial selection process.

I cannot defend an elected BOE as a “democratic” process especially when voter apathy is so great.  No amount of voter education or money can “fix” this problem in a timely way.  The future of public education is at stake, the future of our children is at stake.  Democracy will not survive if public education is not our most important priority.  So please vote “yes” on the appointed school board question and remember, a blank vote is counted as a “no” vote.

Do I have a race? – Update/DePledge’s article

Here’s Derrick DePledge’s article that appeared in this morning’s paper.

Do I have a race? I think not.

The filing deadline for the 2010 elections was yesterday at 4:30 p.m.  David Hamman, a Republican living in Princeville, pulled nomination papers for the House District 14 seat on July 13.  He filed the House nomination papers on July 19 and withdrew his nomination papers that same day.  Then on that same day, July 19, he pulled nomination papers for the Senate District 7 seat and filed his nomination papers that same day.  I believe he had no intention of running for the House seat because his website announced his candidacy for the Kauai Senate seat before July 13.

Today I learned that Scott Nago, the Chief Elections Officer, has made a decision that would give the Republican Party of Hawaii an extra three days to field a Republican candidate against me because of Hamman’s withdrawal.   The law does allow for a Party to fill a “vacancy” by a  candidate who withdraws from a race after filing.  However, since Hamman withdrew from the House race prior to 4:30 p.m. on Tuesday, July 20, the filing deadline, he was no longer a candidate. I believe the Chief Elections Officer misinterpreted the law in a way that would make the filing deadline meaningless.  I have sent a request to the Office of Elections asking for the legal basis for this decision.

Clean Energy Transformation Takes More Than “Green” Jobs

Yesterday The Garden Island ran an article about the Kauai Planning & Action Alliance’s annual meeting where I gave a presentation at last Thursday.  While I understand the challenge to write an article on an issue as complex as the clean energy economy and its focus on green jobs, I thought the article missed the gist of my presentation, Hawaii’s Clean Energy Transformation, Creating & Identifying Green Jobs (KPAA62410finalnotes).

Throughout the article were snippets in quotes which did not fully convey and may have inadvertently misstate what was actually said.  For example, went I used the term “energy junkies” it was in the context that we really needed to broaden outreach to include all sectors of community, not just preach to the choir which I described as the “energy junkies”.  And, I use that term in an endearing way as these are the clean energy advocates I can count on to be involved and who already understand the importance of a clean energy economy.  But in order for a clean energy transformation to occur the reach has to be far beyond the choir and immediate congregation.

In my presentation I reference the essay The Death of Environmentalism and the book that resulted from that essay, Break Through.  I bring these two references up because both are provocative in pointing out that the stakes are too high to continue with a business as usual scenario and environmentalism alone will not save the planet.  However, reframing issues to engage a larger stakeholder groups can lead to greater buy-in and participation demonstrating a good solution has multiple benefits.

A Hawaii clean energy economy transformation is both technical and social engineering at its best.  And, unless we can gain confidence in this long-term strategy from a broad base of Hawaii residents and businesses a transformation will be almost impossible to bring to fruition.

sPACEd out – Property Assessed Clean Energy

Some would like to give the impression that political posturing and bickering was the sole reason for the demise of House Bill 2643, the Property Assessed Clean Energy program.  I have, along with Speaker of the House Calvin Say, taken the brunt of criticism in the press and from PACE proponents for killing a bill I introduced by not moving it to conference committee and passing out House Resolution 47 instead.  However, if one were to take a pragmatic and reasoned approach in analyzing House Bill 2643, simply put, it was not ready for prime time.

PACE is a property tax lien oriented financing that can be used as a tool to improve the economics of energy retrofits where the biggest barrier to their installation is coming up with the upfront cash to make such improvements.  Unfortunately, PACE is a relatively new program fraught with lots of buzz and attractive sound bites, after all who doesn’t want to promote easy financing for clean energy.

Let me make this very clear.  There is nothing in statute that prevents each county within Hawaii from instituting a PACE program on their own.  House Bill 2643 proposed floating state bonds and establishing a state revolving loan program to filter funding to the counties for loans to property owners to install clean energy improvements where the loan repayments would be made through a special assessment in the collection of property taxes.  This is very different from what is happening in mainland cities where the municipalities who are directly responsible for assessing and collecting property taxes are adopting the program by floating municipal bonds, not state bonds.

The mayors of each of our four counties are not totally sold on PACE and fully supported House Resolution 47 which called for the Department of Business Economic Development and Tourism to work out the bugs with all the stakeholders.  Without buy-in from the counties PACE simply would not work.

So I guess the first question to be asked, why should the Legislature move forward on a program the counties are ambivalent about?  As each county faces reduced revenues and budget shortfalls, the creation and administrative cost of a new program is of serious concern.  And these types of issues were not resolved by the time the bill reached conference.

Mortgage lenders are concerned about the priority of liens, and rightly so.  This concern is not only being raised by Hawaii lenders alone but by lenders across the country.  A  March 25, 2010 Wall Street Journal article touches on this concern.

. . .This debt (the PACE loan) would be senior to existing mortgage debt, so if the homeowner defaults or goes into foreclosure, it would be repaid before the mortgage lender gets any money. While property-tax assessments are usually senior to existing property debt, cities have traditionally used their assessment authority for community-wide improvements like sewers and roads—not for upgrades that homeowners elect to make on their own homes. . .

. . .But the regulator of Fannie Mae and Freddie Mac—which guarantee half of the nation’s $11 trillion in mortgages—has raised concerns in meetings about the program with federal and state officials. Alfred Pollard, general counsel for the mortgage companies’ regulator, the Federal Housing Finance Agency, said he was worried about the problems that a first-lien, or first-in-line, loan could create. “The goal of enhancing energy efficiency, which we share, should not overcome the need for prudent underwriting,” he said.

Fannie and Freddie aren’t allowed to speak out on public policy, and the companies declined to comment for this article. PACE advocates have lobbied for a measure barring Fannie and Freddie from taking any adverse action over the next two years on communities participating in PACE.

Critics of the program say that Fannie and Freddie, or mortgage lenders themselves, could raise rates in such communities to cover the risk that a PACE loan will displace payments to the mortgage holder. Cities could also face legal challenges, they say. The state of Maine is considering making energy loans junior to existing debt in legislation that would establish its PACE program.

“The fundamental problem is that there isn’t a free lunch but there often appears to be,” said William K. Black, a professor of economics and law at the University of Missouri-Kansas City.

One of the challenges of PACE is insuring that the bond rate, the interest rate for the assessment and the administrative fees associated with the program are affordable and attractive enough to make the program a success.  Currently, mortgage and home equity interest rates are very low.  In many cases on the mainland people who initially signed up for PACE dropped out because it was far cheaper for them to either restructure their mortgage or draw on their home equity.  In an analysis of the Berkley PACE program it was found that property owners who were creditworthy and did not have a problem securing financing but just had to be motivated to make these improvements.  Therefore, if PACE cannot compete with traditional financing, there may be a propensity for PACE programs to attract less creditworthy property owners.  As this is a relatively new program there is no track record or risk evaluation.

Because PACE is an opt-in type of program and needs pull-through to make a substantial impact, the key is for the State and counties, as critical partners, to educate property owners and to assist in making the energy assessments and financial evaluations to help implement the retrofits.  The objective would be for a transparent, easy-to-access, standardized, with correctly “sized” incentives, not subsidies, with installation by qualified vendors for a self-sustaining program.  DBEDT intended to put the details in administrative rules, however, by the end of second crossover and as the bills were being scheduled for House-Senate conferences there were more questions than answers.

Overzealous proponents of PACE may feel that this is a serious setback in our advancement for renewable energy and energy efficiency.  However, it is not the lack of a PACE program that will put a brake on the Hawaii Clean Energy Initiative but the lack of funding overall to carry out the long term strategy for energy and food security in Hawaii.  It was the Governor’s veto of the barrel tax last year and again this week that gives Hawaii’s energy security strategy an uncertain future.  All of the Energy Division’s special funds and stimulus money will be sucked dry by the end of the next fiscal year and their general fund funding will be jeopardy like any other program if we fail to fund this Division with a dedicated tax.  The reality could be that there wouldn’t be anybody to run a PACE program in the next Administration or the county level given the current furlough and economic conditions.  However, there now is a little light of hope with the veto override of the barrel tax.