A bill would prohibit lobbyists from cutting checks to lawmakers during the legislative session, but wouldn’t prevent other people with an interest in legislation from writing checks.

In February 2020, days before Hawaii’s Senate Ways and Means Committee was scheduled to hear a bill benefiting some developers of solar farms, the checks started rolling in from lobbyists for companies that wanted it to pass.

On Feb. 13, a week before WAM’s hearing, campaign finance records show lobbyist Joanne Hamm donated $1,000 each to the Ways and Means chair, Sen. Donovan Cruz, and Sen. Lorraine Inouye, another committee member. Records show that on the day of the vote another WAM member, Sen. Michelle Kidani, accepted a $1,000 donation from Hamm, who goes by the name Nonie Toledo.

Senator Donavan Dela Cruz smiles and flashes a shaka at the KUPU Net Shed during a press conference.
Sen. Donavan Dela Cruz, chairman of the Senate Ways and Means Committee, accepted thousands of dollars in contributions from a solar company executive and its lobbyist days before his committee was scheduled to vote on a measure the company wanted passed. A proposed bill would limit the lobbyist contributions but not from the company exec. (Cory Lum/Civil Beat/2022)

At the time, Hamm represented a firm called 174 Power Global, which testified for the bill. The measure would have eliminated a tax credit program for solar farms but grandfather in firms like 174 Power Global, which were pursuing projects already approved by regulators but not completed. Firms like 174 Power Global said they had baked the expected tax credits into their financial plans and that losing the credits would be a major blow.

Hamm wasn’t alone making donations to Ways and Means members. SanHi Government Strategies, a lobbying firm representing a solar company called Innergx, also supported the measure generally – but wanted a small change. SanHI donated $300 to Inouye on Feb. 13 and $300 to Kidani the day of the vote.

After the committee voted unanimously in favor of the bill, including SanHI’s requested amendment, the lobbyists rewarded the members with more largesse. Hamm on Feb. 25 donated $250 each to Sens. J. Kalani English, Dru Kanuha and Gil Keith-Agaran. SanHI donated $250 to Kanuha and $500 to English. All those donations came during the legislative session.

While such donations are completely legal, that soon may change. Lawmakers are considering a bill that would prohibit registered lobbyists from making donations to legislators during the legislative session.

People and entities who are not registered lobbyists, like the energy company execs, would still be allowed to donate during session. A bill that would have prohibited all donations during session was recently killed by lawmakers.

The bill banning lobbyist contributions sponsor, Sen. Karl Rhoads, declined to discuss lobbying surrounding the 2020 solar tax credits, and whether the bill was meant to address that sort of activity. Instead, he said the bill is generally meant to separate lawmaking from fundraising.

“The idea of the bill is to disconnect our legislative activities from our fundraising activities as much as possible,” said Rhoads, who chairs the Senate Judiciary Committee.

Sen Karl Rhoads questions HTA about their $82 million dollar budget in joint senate committee hearings.
Sen. Karl Rhoads says it’s unfair to incumbents to prohibit all campaign contributions during the legislative session. (Cory Lum/Civil Beat/2018)

Hawaii’s measure is headed to conference committee, where lawmakers will try to work out differences in House and Senate versions of the bill. If the bill is adopted, Hawaii will join 29 other states that limit people from making donations to legislators during legislative sessions, according to the National Conference of State Legislatures.

Fifteen states ban all donations, including those from individuals and corporate executives not registered as lobbyists, according to NCSL. Hawaii’s restriction would apply only to registered lobbyists.

Rhoads said the bill was limited to lobbyists because in his view it would be unfair to incumbents to restrict donations from others during the session. Doing that would limit the amount of time the lawmakers can raise funds, which would include election cycles that coincide with legislative sessions.

“It’s an unfair advantage to the challenger if the incumbent can’t raise money right in the middle of a race,” he said.

Bill Lets Wealthy Interests Donate During Session

In practice, limiting the restriction to lobbyists would allow money to continue to flow to lawmakers from special interest donors. The donors simply couldn’t be registered lobbyists or engage in lobbying, a term of art that includes a number of specific activities intended to influence government officials. In the case of the solar tax credit bill, for instance, it wasn’t just registered lobbyists working for solar companies who made donations to Dela Cruz and his fellow Ways and Means Committee members as they prepared to vote on the bill.

For example, on Feb. 13, records show, Dela Cruz received a $1,000 donation from Laurence Greene, a California-based vice president of Hamm’s client 174 Power Global. Greene also made $1,500 donations to Inouye, on Feb. 11 and to Kidani on Feb. 20, records indicate. 

A week before the vote, Dela Cruz, Kidani and Inouye also received donations from Carlito Caliboso, a Honolulu energy lawyer. Although Caliboso was not registered as a lobbyist at the time of the vote, Hawaii Ethics Commission records indicate, his law firm, Caliboso Yamamoto, has represented 174 Power Global’s Hoohana project before the Hawaii Public Utilities Commission.

Hawaii Rep. David Tarnas, Rhoads’ counterpart as House Judiciary Committee chairman, said lawmakers should prohibit donations from individuals as well as lobbyists during the session. In fact, Tarnas said, the House proposed two bills that would have done that, which were proposed by the special Commission to Improve Standards of Conduct and the Hawaii Campaign Spending Commission.

The bills passed out of the House, but Senate leadership referred them to the Senate Judiciary Committee, where Rhoads let the bills die without hearings.

Tarnas said he generally supported Rhoads’ bill as part of a mosaic of legislation even though Rhoads’ bill lets parties make donations that their lobbyists wouldn’t be able to.

“I’m not happy with that,” Tarnas said. He added, “I felt we were covering our bases” with the House bills that Rhoads killed.

The Legislature’s judiciary chairs, Rep. David Tarnas, left, and Sen. Karl Rhoads have different stands on restricting campaign donations to lawmakers during the legislative session. (Screenshot)

Asked if he agreed with Rhoads that it would hurt incumbents if they couldn’t collect donations from individuals during the session, Tarnas said, “I’m not so worried about that. There are so many advantages that an incumbent has that I’m not worried.”

The House bills would have prevented the sort of fundraising that occurred around the time of the Ways and Means Committee vote on the solar tax credit bill in 2020.

Kidani and Dela Cruz couldn’t be reached for comment. But Inouye said in an interview that she recalled that in February 2020, she participated in a joint fundraiser with Dela Cruz and Kidani at Mandaly Restaurant on Alakea Street near the State Capitol. That, more than the date of the hearing on the solar tax credit bill, explained the timing of the donations.

Campaign finance records show Dela Cruz held a fundraiser at Mandalay on Feb. 13, although Kidani and Inouye are not listed in the records.

“I don’t think I would have accepted it if it wasn’t during an ordinary fundraiser,” she said of the donations. “That’s how I manage my campaigns.”

She pointed out that since then the Legislature has prohibited fundraising events during the session.

“If we can’t hold fundraisers during session, that’s fine with me,” she said. “If the law is there, the law is there.”

Asked if she would support banning contributions during session altogether, Inouye said, “That’s fine with me as well.”

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