The tents lining Kapalama Canal and the burgeoning homeless encampment in Kakaako are stark reminders of the worsening affordable housing crisis in Hawaii, which has the highest rate of homelessness in the nation.

Despite the desperate need for low-income housing, about 175 public housing units are sitting empty, largely because state policymakers haven’t allocated enough funding and resources to renovate them.

The number of vacant units is expected to double after the Legislature severely underfunded public housing repairs this session and cut off a civil service exemption that allowed the agency to employ a a less-costly maintenance team.

The Hawaii Public Housing Authority estimates it would cost $9.5 million to renovate all 175 vacant units statewide. That’s just over $54,000 per unit, a steal given the $700,000 median home price in Honolulu.

But the authority only received $4.1 million for capital improvement projects from the Legislature this year, according to Hakim Ouansafi, the agency’s executive director. That pales in comparison to its projected repair and maintenance need of about $820 million over the next 10 years.

As a result, Ouansafi said, the total number of vacancies is going to double.

“When you have $820 million of backlog and you ask for $180 million and you get $4.1 million, it’s very difficult to do much,” he said.

“It really seems like a no-brainer to invest the relatively minimal amount to open up those units in public housing and maximize their use.” — Gavin Thornton, Appleseed Center for Law and Economic Justice

The average family size in state public housing units is 3.5 people, suggesting that the 175 currently vacant units could serve 612 people.

Gavin Thornton, attorney at the Appleseed Center for Law and Economic Justice, said the lack of investment in public housing repairs is frustrating and disappointing.

“It seems like a pretty short-sighted policy move given how expensive it is to care for people experiencing homelessness on the street without shelter,” Thornton said. “It really seems like a no-brainer to invest the relatively minimal amount to open up those units in public housing and maximize their use.”

Rep. Sylvia Luke, who leads the House Finance Committee, is among the lawmakers responsible for setting aside less than $5 million for public housing repairs, as well as ending the civil service exemption.

She acknowledged that the state hasn’t been aggressive enough in addressing homelessness.

“For a while I think we have been deferring to the city and the city has taken the approach of clean up and sweeps but clearly that’s not working because that’s just pushing the homeless from one neighborhood, Waikiki, to Kakaako,” she said. “Clearly the sweeps are not a solution.”

But she’s not sure whether public housing will be part of the solution, either, even though the Housing Authority has housed 4,000 homeless people in the past five years.

Luke said she didn’t support extending the civil service exemption or approving more funding for the agency because she has concerns about its management and its use of state and federal funds. She also criticized the agency’s transparency and communication.

Still, she said the recent assault on Rep. Tom Brower at the Kakaako homeless encampment highlighted the urgent need for lawmakers to take more responsibility to tackle homelessness.

“I think the unfortunate thing was that we’ve known what was going on and we just sort of put our heads in the sand and hoped that somebody else would take care of it,” she said.

It Used to Be Worse

While 175 empty units may sound like a lot, it’s less than 3 percent of the state’s 6,125 public housing units. That percentage represents a huge improvement from 10 years ago, when the vacancy rate fluctuated from 10 to 15 percent. In February 2005, The Honolulu Star-Bulletin reported that there were 871 empty units in 76 housing projects.

The number of vacant units has drastically shrunk since then, following class-action lawsuits from public housing residents complaining about poor living conditions. That spurred an increase in state investment in public housing maintenance.

Another key factor was the use of “Special Teams” to conduct comprehensive maintenance through a temporary civil service exemption, Act 159, enacted in 2012.

Ouansafi said the exemption allowed the Housing Authority to assemble multi-skilled workers into groups that could complete comprehensive repairs more quickly.

Ouansafi credits the teams with decreasing the average turnover rate for unoccupied units from 268 days to seven, and said the group conducted repairs at one-third the cost when a contract is put out to bid.

He wanted the Legislature to extend the civil service exemption for two more years to give the agency enough time to reorganize its construction units and continue to train the rest of the staff.

But the bill died in the last days of session after facing opposition from unions, including the United Public Workers, which argued it was unnecessary.

“Quite frankly the lack of funding and that act disappearing was demoralizing to quite a lot of people,” Quansafi said.

The agency calculated that losing the teams could shoot vacancy rates back up to 10 percent to 15 percent and cause the loss of millions of dollars in federal funding that is awarded based on occupancy rates.

“I think the unfortunate thing was that we’ve known what was going on and we just sort of put our heads in the sand and hoped that somebody else would take care of it.” — Rep. Sylvia Luke on homelessness

That could also require the agency to cut its staff by about 40 people, because almost all of its 300 positions are federally funded, Ouansafi said.

The potential for more layoffs spurred the Housing Authority to work with UPW to establish a pilot project for a new maintenance crew that will rely on civil service workers but mimic the organization of the previous “Special Teams.” The authority held a job fair last Thursday to recruit 56 people for that crew.

But Ouansafi estimates that the new teams will take two months or more to assemble, leading to more delays in repairs and maintenance.

Meanwhile, more than 10,000 people are on the current wait list for public housing.

Management Concerns

Luke from the Finance Committee doesn’t think the Legislature is to blame for the growing number of vacant units.

“It’s not acceptable for the Public Housing Authority just to blame the exemption,” she said, noting that some legislators were offended by the implication that civil service employees may not be as effective as exempt employees.

She also criticized the public housing agency for what she sees as poor transparency, and said she has questioned whether the agency has been using state and federal funds appropriately.

“We want to support the programs that the state provides, but we’re not going to just provide money when there are management issues,” she said.

There are a dozen vacant units at Mayor Wright Homes, a state public housing project, according to the latest statistics.

Cory Lum/Civil Beat

She said her concerns about potential misuse of funds were not related to any specific project but were “just in general,” and added that the Department of Budget and Finance had similar concerns, although a state budget official said he’s not aware of any current concerns regarding the Housing Authority’s spending.

Ouansafi said in an email that the agency provided Luke with documentation to allay her concerns about its use of funds earlier this year. He said the Department of Budget and Finance director, Wes Machida, plans to speak to Luke regarding what Ouansafi sees as a misunderstanding.

Machida wasn’t available for an interview last week, but Roderick Becker, deputy director at the state Department of Budget and Finance, said the agency was concerned last fall about the Housing Authority’s request to use state funds to reimburse expenditures for federally funded positions, but resolved that issue by denying the request. He said he’s not aware of any existing concerns about the authority’s use of funds.

Broken pipes at the back of an empty building at Kalihi Valley Homes.

Cory Lum/Civil Beat

Luke said part of the reason that the Legislature provided relatively little funding was that Gov. David Ige only requested $5 million for repairs and renovations, despite Ouansafi’s efforts to secure $180 million.

“I think the problem is they have a hard time even trying to convince their own administration of the need,” she said, noting that the Legislature generally doesn’t substantially increase the administrative budget request for capital improvement projects because of concerns about future debt service.

Substantial state investment in construction projects also would have increased costs for construction activity in the private sector by driving up the cost of labor, Luke said.

Becker from the Department of Budget and Finance said that the Ige administration didn’t request more than $5 million for the Housing Authority’s capital improvement projects because of limited resources and competing needs.

He noted that the governor supported setting aside $100 million for the Rental Housing Trust Fund that subsidizes low-income rentals. The Legislature only agreed to fund 40 percent of that request.

Keeping Up with Repairs

Ouansafi said the Housing Authority is aiming for 99 percent occupancy, but decreasing the number of vacant units is a constant battle as more fall into disrepair. In addition, 30 to 40 residents move out or are evicted each month and their units must be readied for new tenants.

The Housing Authority’s units are required by federal law to be “decent, safe, sanitary and in good repair,” an increasingly difficult benchmark as the projects age — the average age is 55 years — and federal funding levels fall.

“Most people that are actively engaged in the legislative process… none of them are in a situation where they don’t have a home.” — Sen. Suzanne Chun Oakland

Some progress is being made. Many of the vacant units are already being repaired and 33 of the 175 units have an applicant assigned to them, according to the authority.

Still, the lack of money for public housing is worrisome to state Sen. Suzanne Chun Oakland, who chaired the Senate Human Services and Housing Committee this year.

Chun Oakland sponsored a bill that would have set aside $90 million for the Housing Authority, but the measure didn’t receive approval from the money committee chairs, Luke and Sen. Jill Tokuda.

Chun Oakland said she’s planning to advocate for more funding again next year. From her perspective, not many people connect the dots between the state’s growing homelessness crisis and the lack of affordable housing.

“Most people that are actively engaged in the legislative process … none of them are in a situation where they don’t have a home,” she said. “Unless (homelessness) affects their district severely or even with that, there’s not been as much action as there needs to be.”

Here is a list of the general locations of each of the vacant units, excluding 37 state-funded projects. The numbers are current as of July 8 and are constantly in flux: