Hawaii nonprofits that still haven’t received nearly $50 million in grant funds from the state may need to wait until December or early next year for that money.

Short of the Legislature calling a special session in the next month – unlikely given that elections are on Tuesday – the only help for the more than 180 nonprofits awaiting grant funding could come from either the current governor’s administration or the next.

The problems with grant funding all stem from a disagreement between lawmakers and the state Attorney General’s Office over wording in the state’s budget bill that appropriated the grant money.

Meanwhile, the holdup in state government is blocking the release of those funds to more than 180 nonprofits and in some cases stalling programs that needed money to get up and running including those to help survivors of domestic violence and people on the verge of homelessness.

Hawaii State Capitol.
Nonprofits anxiously awaiting state grant funds may need to wait months longer because of a disagreement between the AG’s office and lawmakers. Cory Lum/Civil Beat/2021

Last week, a group of nonprofits wrote a letter to Gov. David Ige urging the release of those funds.

“We request that you address this matter promptly and act to ensure the release of the GIA funds before your term as Governor comes to an end,” the letter from the True Cost Coalition said.

In a letter to the nonprofits sent Monday afternoon, Ige’s office said it does not have any grant memos that are ready for the governor’s approval. The office’s response also says the nonprofits should work with the departments to which their grants are assigned and that the process “from start to finish usually takes anywhere from six months to a year.”

Ige was traveling in Japan and was not available to comment on the future of the grants-in-aid awards, his office said.

Nonprofits aren’t the only ones waiting. The Office of Community Services, which now has oversight of all the state’s grant awards, has not yet received funding for those grants and is still awaiting budget policies that outline how to start dispersing those awards.

OCS, which had its staffing increased to eight employees this year from four, started working with the 188 grantees in July on getting those documents ready in anticipation of funding being released, according to director Jovanie Dela Cruz.

Lisa Maruyama, president of the Hawaii Alliance of Nonprofit Organizations, said that some nonprofits have reported needing to fill out more paperwork than usually required for government grants.

“Maybe they are new and are asking different questions,” Maruyama said.

But a disagreement between lawmakers and the AG appears to be the source of all the grant problems.

The Legislature did not include the names of grant recipients, the purpose of each individual grant, or the dollar amount of each grant in the annual budget bill this year. Only a lump sum of just more than $48 million was included for OCS, which is under the state Department of Labor.

All the funds were put under OCS this year to help streamline the process and give nonprofits a common point of contact rather than dealing with different state workers every year, Sen. Donovan Dela Cruz said.

But the grant details were instead included in the Legislature’s budget worksheets that outline state appropriations. Those worksheets, according to the AG’s office, are not part of Act 248, the budget bill.

“Without the required details, the 42F grants are invalid and the funds for the grants cannot be released,” supervising deputy attorney general Bryan Yee, wrote in an email.

The only option, according to the AG’s office, is to have the Legislature convene a special session this year or to fix the bill language when lawmakers convene for the 2023 session in January.

House Speaker Scott Saiki.
House Speaker Scott Saiki said he disagrees with the AG’s office and plans to wait for the next governor to fix the grant situation. Cory Lum/Civil Beat/2022

The governor could call the Legislature into a special session, or lawmakers could convene a special session themselves. But that requires a written request from at least 17 senators and 34 House members – or two-thirds of both chambers.

House Speaker Scott Saiki said a special session is unlikely given that there’s a month left for the current administration. Lawmakers may be waiting to see what the next governor decides to do.

Saiki said he’s hopeful the next governor – either Democrat Josh Green or Republican Duke Aiona – will move quickly to release the funds and put pressure on his executive departments to make that happen.

“If the next governor can just release the funds after taking office in early December, then it wouldn’t be necessary to hold a special session,” Saiki said.

Saiki believes the AG’s interpretation of part of Hawaii’s grants law is incorrect.

“It’s a technicality, it is not substantive,” Saiki said of the grant language being included in the budget worksheets instead of the budget bill.

“Unfortunately, the nonprofits are in an indefinite holding pattern as a result of this incorrect interpretation.”

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