Editor’s note: For Hawaii’s Nov. 4 general election, Civil Beat asked candidates to answer some questions.

The following came from Dave Bateman, Republican candidate for state representative for District 5. Democrat Richard Creagan and Libertarian Jon Lalanne, who did not respond to the questionnaire, are also running.

District 5 includes Naalehu, Ocean View, Captain Cook and Kailua-Kona on the Big Island.

Go to Civil Beat’s Elections Guide for general information, and check out other candidates on the General Election Ballot.

Name: Dave Bateman

Office: State House of Representatives, District 5

Party: Republican

Profession: Coffee farmer

Education: AB – Geology (UC Riverside); JD – Law (University of San Diego ); LLM – International Law (Georgetown University, Law Center, Washington, D.C.)

Age: 68

Community organizations: Kona Sunrise Rotary Club – board and past president; Hawaii Coffee Association – Board; Kona Coffee Council – Board; Coffee Berry Borer Task Force – Board; Big Island Retired Military Association – Board; St Mike’s Catholic Church, Kailua-Kona – Finance Council and Building Committee; and Military Officers Association of America – member

 

Dave Bateman, candidate for state House District 5, 2014

Dave Bateman

1. Why are you running for the Hawaii Legislature?

Our quality of life and standard of living in HD-5 has further deteriorated for most working ohana over the last decade. Hawaii County is still federally designated as a poverty county with over 17 percent of our families of four earning less than $25,000 per year. This is unacceptable. I have a plan to relieve this economic stagnation on the Big Island and revive our economy.

• Food Sustainability: We import over 85 percent of our food into these islands. Our food supply is not sustainable – only 10 days in storage. Importing our food costs our families by many estimates at least $3 billion per year in lost economic opportunity which currently goes offshore to mainland and foreign food suppliers. The current elected officials have done very little if anything to correct this food imbalance. I have a plan to successfully resolve this longstanding challenge. My plan also includes training 5,000-10,000 new farmers to qualify for low cost ag leases and low cost ag loans through the HDOA. This will help improve the stagnant unemployment numbers and family incomes. I discuss my proposal in more detail below in the final Q and A.

• High costs of living — energy: Our energy costs are the highest in the nation by far. We pay about 43-.46 cents/KWH. Most of the U.S. mainland pays 10 cents/KWH or less. I have a plan to increase geothermal power generation, wind turbine power and PV. Under my plan, I firmly believe we can cut our energy costs in half to about $.20.

• High costs of living — taxes: Our personal state income tax brackets top out at 11 percent. The effective tax rate is about 8.5 percent. This one of the highest in the nation. Most businesses are set up as sole proprietor, partnerships, LLC or Sub S Corps. All of these business types are tax pass through entities with the income filtering down to individual owners. Therefore most of the businesses are taxed at these extraordinarily high rates. GET on all wholesale and retail sales is somewhat like a retail sales tax in other states. However the GET applies to every step of the value added process in the manufacture or processing of an item. The effective rate of our 4.1-4.3 percent retail GET is really 11 percent. It is a pyramidal creation. I would eliminate GET on food, medicines and medical care, as ell as the first sale of food products off the farm or ranch. The combination of these taxes is to place a crushing burden on business owners. I have a plan to reduce both of these taxes.

• Government burdens on business: Our state government has one of the highest employee/citizen ratios in the country. The size of government should be cut to a minimum to provide necessary security and required services to its citizens. Not everything needs to be regulated. Government needs to be more efficient and effective. Development and building permits should be easier and quicker to obtain. Vehicle license fees nearly doubled in the last few years. Those fees need to be rolled back to previous levels. This creates an unnecessary strain on families and businesses. We need a government that says “yes” more often and then offers help us accomplish our goals, rather than a government that works to say “no.” Government needs to be more user-friendly. I have a plan to accomplish these goals

2. Are you satisfied with the current plans to pay for the state’s unfunded liabilities? If not, how would you propose to meet pension and health obligations for public workers?

No. Hawaii’s state employment system has a total of over 115,000 members, 66,000 active and over 42,000 retirees and beneficiaries, and 7,000 inactive vested members. The citizens of Hawaii are reeling under a staggering of over $14 billion for unfunded liability for health benefits for retired state workers and $8.5 billion for pension benefits. This amounts to over $10,000 for every resident in Hawaii. The state is currently funded with only $12 billion in assets under management. The state ERS needs another $9 billion just to be considered fully funded. The ERS is about 60percent funded. It pays out about $1 billion annually in benefits.

The state Legislature imposed an expected rate of return of over 7 percent annually. Last year the ERS generated about $1 billion in revenue from its investments. However, experts suggest that the rate of return should be a more realistic 3-4%. The state Legislature set aside $217 million last year for the ERS. At this rate it would take over 100 years to fully fund. I support conservative law makers efforts to increase that amount to $500 million per year. At that rate the trust fund should be 100 percent funded in only 30 years.

Other measures would include reducing the bloated size of government through attrition and early retirements. New state hires should be required to increase the amount of their contribution to the fund, especially health care. Currently they pay only 50 percent of the premium costs. Most importantly we simply need to cut back on the size of government and reduce substantially the amount of new hires. My multifaceted approach, over time, will help bring our unfunded liabilities down and fund retirements for a gradually reducing state employee base.

3. Local officials and advocates have worked to address homelessness for years, yet the crisis is growing. What proposals do you have for this complicated issue?

Homeless number about 8,000 statewide with about 400-500 on the Big Island. This problem creates a negative stigma for tourists who are sometimes preyed upon. We need to help move the homeless off the beaches and out of the parks. My approach is to create more temporary permanent homeless shelters designed to try to help reintegrate the homeless back into society with necessary social services and care. Cost-efficient high-rises on Oahu and mufti-family low rises on the neighboring islands should be converted/constructed. For those who can’t or won’t, the state should continue to provide the necessary services and permanent housing for them. The development authority is the Hawaii Public Housing Authority (HPHA. The financial mechanism for low- to moderate-income housing projects is the Hawaii Housing Finance and Development Corp (HHFDA).

The state is the primary stakeholder in this issue. However, counties and the tourism industry are also stakeholders. All stakeholders need to work together to solve this problem. My initiatives would work a collaboration using HHFDA funding and a portion of the TAT funds to build out the housing required. TAT generates about $400 million annually. I would increase the county share from 44.5 percent to 50 percent to help cover these additional costs. I would also amend HRS 237D-6.5(a)(2) to add a specific funding requirement line item for the homeless issue.

4. Where do you stand on labeling genetically engineered food and pesticide regulation? Are these public safety issues, or are the dangers exaggerated?

I support truth in labeling. The consumer should have an informed choice on what food products to purchase. Even though there are no proven health issues with GMO foods, according the the state Department of Health and the U.S. Food and Drug Administration, I would support legislation that requires GMO food to be labeled as such, as they are not regulated by the state. Pesticides present a different issue. They are strictly regulated by both the U.S. EPA regulate pesticides under the FIFRA law and by the Hawaii Department of Agriculture (HDOA), Plant Industry Division, Pesticides Branch. Because of the strict regulatory oversight, consumers are fully protected from pesticide hazards. No labeling of food for pesticides should be required.

5. Hawaii’s cost of living is the highest in the country by many indicators. What can really be done to make things like housing, food and transportation less expensive?

• Business regulation climate: Hawaii’s regulations on business are oppressive. We have a government that would rather say “no” to a project or idea and stop it rather than “yes” and an expression of how can we, the government, help you achieve your business goals. We are the least desirable state to invest in and do business in. We cannot attract new capital and new manufacturing and service industries with the current climate. I propose to try to reduce the size of government, the amount of regulations and taxes. We also need to market our state just like New York and Texas.

• Taxes: Our personal state income tax brackets top out at 11 percent. The effective tax rate is about 8.5 percent. This is one of the highest in the nation. Most businesses are set up as sole proprietor, partnerships, LLC or Sub S Corps. All of these business types are tax pass-through entities with the income filtering down to individual owners. Therefore most of the businesses are taxed at these extraordinarily high rates. GET on all wholesale and retail sales is somewhat like a retail sales tax in other states. However the GET applies to every step of the value added process in the manufacture or processing of an item. The effective rate of our 4.1-4.3 percent retail GET is really 11 percent. It is a pyramidal creation. I would eliminate GET on food, medicines and medical care, as well as the first sale of food products off the farm or ranch. (Amend HRS 237-24). The combination of these taxes is to place a crushing burden on business owners. I have a plan to reduce both of these taxes. I am also opposed to any increase in the 9.25 percent TAT covering rentals.

• Licenses and permits: I would accelerate the building permit process by requiring any state or county official considering a permit application to render a decision within 30 days of filing a “complete” application. If no decision is made within the permitting period, the permit is deemed issued as a matter of law. Vehicle license fees should be rolled back to their levels prior to 2012, to give financial relief to families and businesses. Reduce the excessive documetnation required merely to get or renew a driver’s license

6. Would you support using liquified natural gas as part of the state’s energy sources? And how can we improve the electrical distribution system so more renewable energy can be utilized to bring costs down?

Hawaii energy is the most expensive in the country by a factor of almost four. I favor LNG as an interim measure to help us attain energy costs savings for Oahu. LNG is a more efficient and cost effective fuel source. Oahu could realize energy savings of up to 50 percent.

However, eventually I would hope to see continuing installations of residential and commercial roof top and ground array PV systems as alternative energy generators to meet the 2030 HEI goal of 70 percent (40 percent alternative energy and 30 percent energy savings). This energy imitative was born out of decoupling HECO’s method of tying costs to sales. I favor wind turbine generated energy. And most importantly for the Big Island, I favor increased use of geothermal.

On the Big Island we currently have a population of about 190,000. We require about 180 MW of power. Most of our energy is still produced by petroleum based fuels. The Puna geothermal plant produces about 38 MW of power. I propose encouraging private investment and development of up to six 25 MW geothermal plants along the Kilauea Rift Zone in non-populated areas. HELCO should be encouraged by the PUC to increase the capacity of its transmission lines throughout the Big Island to accommodate the new energy generators. I calculate that for the Big Island these improvements would cut our HELCO energy rates in half from 43-46 cents/KWH down to about 20 cents/KWH. Transmission line attenuation loss issues can be reduced moving the current over the lines as direct current (DC) as opposed to the standard alternating current (AC). This will make energy delivery more efficient and less costly for HELCO. I also favor he concept of wheeling power from one source to a predetermined destination, e.g., hotel or resort, HELCO receiving a substantially reduced wheeling charge.

I also favor further studies on the much discussed and estimated $1 billion submarine power cable from Maui to Oahu (200 MW) and the $3 billion cable from the Big Island to Oahu (400MW). Both cable systems would invert AC power at the source to DC power to transmit and the re-invert back to AC on Oahu. My only concern with the cables is that the technology proves it to be an environmentally safe endeavor. However, this must be a private investment venture and not another CIP for the state. No state funds should be utilized for this venture. The market demand for reduced energy costs exists for our population concentration on Oahu and in Honolulu. There are legitimate business opportunities to generate, transmit and distribute energy to Oahu, even with the cost savings realized by the proposed introduction of LNG onto Oahu. Research and studies into the cable should be encouraged by the state and federal governments. Their only involvement, however, should be the permitting process.

7. Hawaii’s public records law mandates that public records be made available whenever possible. Yet many citizens are unable to afford the costs that state and local government agencies impose. Would you support eliminating search and redaction charges and making records free to the  public except for basic copying costs?

Yes. Many people can not afford the high costs of copying/redacting public records. However, before a person goes to the public agency counter to retrieve public records at a substantially reduced cost, I would suggest the law regarding copying charges be amended to require an initial effort to first attempt to retrieve and transmit records electronically. The citizen should be required to email in or call in and attempt to have an electronic copy sent to their email address. FOIA forms, when necessary, should be made available on line also and at the counter. Alternatively, the customer could go into the agency office, figure our what they want after pursuing the public records and then ask the assistant to email the desired records to their email address. Only if the records are not available in electronic format or there is no way to send the records electronically, the customer would qualify for the free or reduced copying rates. If someone just stops in to the agency or public office and is not desirous of pursing electronic transmission, when that option is available at both ends, then that customer would be charged the full rate. Litigation subpoenas duces tecum and FOIA requests should be treated the same way once permission is granted.

8. Are you satisfied with the way Hawaii’s public school system is run? How can it be run better?

No, it is not working. Hawaii has 289 public schools (255 public and 34 charter) and educates about 180,000 students (K-12). DOE employs about 13,000 teachers and 12,000 support staff. Staff numbers have risen 180 percent over the last 35 years compared to only 27 percent increase in the number of teachers, with the student body number remaining relatively constant over that same time period. Its annual direct expenditure budget is about $1.7 billion. Factoring in supplemental items such as retirement benefits and other soft costs escalates the annual DOE expenditures to about $2.5 billion ( $13,000/student). The average teacher salary is about $53,000/year. Hawaii still ranks about 44 out of 51 state/DC educational jurisdictions in terms of overall performance. We are the only remaining centrally operated system in the country. The other states typically run local school board systems. Hawaii does not have a functional system. Our keiki are illiterate leaving high school they are not qualified for the local, state or international work force. Many cannot even pass basic military entrance exams. Something is systemically wrong with the education business at the DOE. An audit is called for. The last one was conducted about 40 years ago.

Teaching is a complex science as shared by many of the teachers I have spoken to. Hawaii is multicultural – language is often a barrier. We have a number of dysfunctional single-parent families. We have drug problems in many homes. Some of our keiki have learning disabilities. All these kids are thrown into the same classroom and the teacher is expected to teach the same material to each child equally with the same results. State DOE and federal DOE heap on more requirements. This is a quagmire for the teachers. Yet the state DOE provides no relief. Teachers are frustrated and tired. We need to revamp the DOE after an audit that will tell us where the problems are.

Meanwhile, I think we can begin the change by retiring a number of staff administrators not directly working in the classroom through attrition and early retirements. DOE is bloated with excessive non-productive support staff. There appears to be no logical need or reason for the inordinately high ratio of staff/teachers, other than for blatant cronyism.

But most importantly, I would push to decentralize DOE centralized management down into local county school board management. The parents need to have input as their child’s education and be able to challenge ill conceived methods such as Pono Choices. The parents and teachers need to work collaboratively at the local level to resolve local teaching and leaning issues. Every school has a different personality and learning needs. Local school boards can better address those needs.

I would also promote more Vocational Technical programs to fill the labor force with skilled workers. For example, I am promoting a two year program for agriculture to keep more of our kids here on the island as farmers and ranchers.

I believe my overall plan for education will go a long way to improve the quality of education in Hawaii. But again we need to work collaboratively with all the stakeholders. Education is a business. It needs to meet appropriate metrics and standards of performance. We need to see a better ROI for our investment of kids and dollars so that they are able to compete successfully anywhere in the world.

9. There is a desire to grow the economy through new development yet also a need to protect our limited environmental resources. How would you balance these competing interests?

Reasonable environmental protection should always take precedence in Hawaii. We are limited in land and resources. We must malama the aina carefully. Environmental extremists will not be satisfied with anything short of a total moratorium on all development. Some developers will push the environmental envelope with abandon totally dissing environmental considerations. Most of us seek a proper balance toward the middle of the environmental spectrum to find the appropriate balance for each project. That is where I stand. Environmental protection for our generation and future generations must be balanced with the need for growth to accommodate more population. More low density/high density residential space for living, and more commercial, industrial and office space for work is inevitable. We must accommodate all of this in balance. That is the purpose of EA/EIS reviews under HEPA for a project application — assess likely environmental impacts — and then apply the carefully drafted land planning and permit laws to create the proper balance.

10. What other important issue would you like to discuss here?

Food sustainability and creating new ag hobs. Hawaii imports 85 percent of its food. We have 10 days’ supply. This costs Hawaii residents about $3 billion annually, which flows offshore to U.S. mainland and foreign suppliers. There is no reason for this inflow of food and outflow of cash. We have some of the best growing land in the world right along our two volcanoes (Hualalai and Mauna Loa) on the Big Island. We can grow and produce all the veggies, fruit, nuts, cattle, pork, chickens, eggs, etc, we need right here in West Hawaii – Kona to Ka’u. All we need is 10,000-15,000 acres and 3,000 gallons of water per acre per day. We can assemble good A grade ag land leases from the state, county and large land owners. Most of the time we receive adequate rainfall to satisfy irrigation needs, however if required, supplemental irrigation water can be supplied with through drilling more wells along diked rift zones with perched water tables that replenish readily. We have plenty of extra water in Ka’u. If necessary, we can pipe water in from Hilo side along Mauna Loa to Kailua-Kona. (Hilo wastes 160 million gallons of water daily into Hilo Bay.)

The Big Island loses many of its keki to the mainland to pursue and education, families and jobs. Under my proposal, we could create as many as 5,000-10,000 new ag jobs and farm and ranch investment opportunities on the Big Island. Young high school graduates interested in pursuing owning their own farm or ranch would complete a two-year degree in agriculture, ag-business, farming, or native Hawaii farming techniques (mahiai). They would then qualify for low cost ag leases and 50/50 matching low interest long term (3 percent 30-year fixed) loans from the state through the HDOA ag loan program, which is already in place. These young people now have an opportunity to own their own operations rather than work for someone else. This is the American dream. The source of loans (assume $500 million to begin with) is the ERS. My program would guaranty 3 percent ROI to the state ERS fund on a very low leveraged and risk loan (50 percent LTV.) Three percent is the realistic ROI goal set by experts on the ERS investment protfolio most of which is in Wall Street securities. Under my proposal, our own state ERS would be investing in the food production for this state, creating thousands of new jobs here, with virtually no risk, and generating new sources of state income tax. The true ROI will be much greater than the 3% interest on the face of each loan. My proposal presents a win-win-win scenario.