Last year, the state Legislature awarded the Department of Agriculture nearly $20 million to allow it to carry out more aggressive efforts to deal with invasive species. Governor Josh Green pared that back by half. Still, $10 million for biosecurity was more than three times what the department had received the year previous.
On January 17, a joint session of the Senate Committee on Agriculture and Environment and the House Committee on Agriculture and Food Systems met to understand generally what state agencies were doing to address biosecurity.
Not surprisingly, most of their attention focused on the DOA’s use of the funds awarded to it last year in Act 231. DOA director Sharon Hurd was in the hot seat for nearly an hour of the two-and-a-half-long meeting, during which she was subject to unsparing questioning and criticism of her department’s stewardship of Act 231 funds.
In her introductory remarks, she stated that of the $10 million actually awarded to her department, 65 percent had been obligated and 52 percent actually encumbered. She said she expected to have all funds encumbered by June 30, when the fiscal year ends and unencumbered funds would lapse. The only hesitation concerned the 44 new positions that the Legislature authorized. Whether the Department of Human Resources Development, the state civil service agency, would conclude its review and classification of the positions in time to advertise the positions by the end of the fiscal year was out of Hurd’s hands, she said. Still, she told the lawmakers, she was hopeful this could be done.
The Legislature had allocated more than $3 million to pay for the new positions, leaving around $7 million for the department to address the other items called out in Act 231. The three largest items called out in the long list of issues in the act were, before the governor halved the appropriations: little fire ants, $2.5 million; public awareness campaign, $2 million; and tech upgrades, $2 million.
Rep. Nicole Lowen of Kona started off the questioning, asking about the funding for everything other than personnel.
“Sixty-five percent is obligated,” Hurd said. “By obligated, we mean we’ve done an RFP [request for proposals], given an award. So the funding is tied up. Nobody else can get it. It belongs to HTM for [coconut rhinoceros beetle], belongs to Terminix for [little fire ant].” Contracts for each of these came to $1.1 million.”
An $800,000 contract that had been issued to deal with green waste was “flawed,” she said, since the RFP included hauling but not loading. But “we should have that RFP reposted in February,” Hurd told the legislators.
Lowen asked about the expenditures relating to little fire ant (LFA) and coconut rhinoceros beetle (CRB). “You said $1.1 [million] for LFA and $1.1 [million] for CRB. That’s of that $10 million?”
Yes, Hurd answered. “With LFA, you gave us $1.5,” she said, adding that the Department of Agriculture had held back $400,000 in reserve “for our work with nurseries, training, biochemicals. So $1.1 is what we awarded to Terminix to treat residences.”
“Where are they going?” Lowen wanted to know.
Hurd said that Terminix would be treating 580 houses on Oʻahu and 290 on the Big Island. “And then for Maui and Kauaʻi, … they’re gonna go survey, see what kinds of responses they are getting, do outreach, like actually show the people if you see this, do that.”
The selection of Terminix to receive nearly the entire sum of funds that were to address problems associated with the little fire ant quickly became one of the themes of the hearing.
“How do you pick which homes get subsidies and other homes don’t?” Lowen asked. To which Hurd said that the DOA had “a list of people,” some self-reported, others identified by staff or by the different county invasive species committees (ISCs). “In fact,” she added, “Terminix, they just talked to us today,” wanting to get the list.
“I mean, there’s more than that number of homes that have LFA problems just in my district alone. How do you choose who gets state money versus who has to pay for it themselves?” Lowen wanted to know.
“We’re going to leave it up to Terminix,” Hurd said. She said that the reason the department selected Terminix was because they already had the chemicals, the personnel, liability insurance, and could deal with people who have allergies or other special needs.
Lowen pressed the point. “There has to be some process for deciding who gets subsidized.”
Hurd: “I’m going to have to ask Terminix and get back to you.”
“Why would you leave it to Terminix to decide?” Lowen asked.
“Because the contract isn’t done yet,” Hurd said. “We have to – the scope, of how – how would you like us to decide?”
“There’s all kinds of different ways you could approach it,” Lowen said. “You could look at income, you could look at need, which communities have greater opportunities for prevention, or keeping it from spreading, where there have been more consistent problems, where the most claims have been. There’s a ton of different ways.”
Lowen pointed out that the Big Island had much greater need for LFA control than Oʻahu, which was getting the lion’s share of the benefit. “Of those 290 houses you mentioned, are they in Hilo, or Kona, or where are they?”
Hurd said that Terminix would be deciding what the best way is to “move in and actually attack the problem” in areas where surveys had shown LFA to be present.
Lowen objected once more to Terminix making those decisions. “If that’s part of what they’re supposed to be doing under their contract, is to determine how state funds are distributed to citizens –”
Hurd jumped in to say that the DOA’s Plant Quarantine Branch would be involved in the decision, “but it’s going to be something we have to talk to them about.”
The idea of the state paying for the treatment of every homeowner with an LFA infestation would have been great if it had existed a decade ago on Hawaiʻi Island, Lowen said. “I understand you want to nip it in the bud on a new island … but on Hawaiʻi Island, it’s widespread. … Two-hundred some homes, that’s nothing.
“As you well know, LFA treatment is not a one-time thing. It’s a long-term treatment, over months. … This just feels like throwing taxpayer dollars at some people through a private company, instead of investing in a long-term solution for the problem.”
Rep. Lisa Marten wanted to know why Terminix was chosen, “when we have far more experienced entities, like the Hawaiʻi Ant Lab, that have done some training for Terminix but haven’t shared all their deep knowledge. …
“They were not able even to apply to the RFP because you limited it to private pest control companies. I’m just super concerned we’re leaving the experts behind who are trying to serve the public interest, and instead asking for-profit companies … to not only do the job but then even make policy decisions about who gets the benefits and who does not.”
She asked Hurd again why the RFP was set up in a way that excluded the Hawaiʻi Ant Lab, or HAL.
Terminix, she said, has the licenses, businesses, registrations, the insurance needed, and trained applicators. “So the main concern we had was for kupuna, [people with] allergies, those who want only organic treatment…. They had the – I think the most important thing when we had our discussions was the liability. They know what they’re doing in terms of the health and welfare of the people they’re serving.”
“You’re suggesting they know more than the people that trained them?” Marten asked, referring to HAL.
“No, I’m suggesting they have more insurance, more access to chemicals – they have it probably in their warehouse – and the equipment,” Hurd said.
“But, you know, there’s another bucket of funding coming, hopefully. We’ll learn from this, and say, for this size house, this many people, this is the amount of money we need for that.”
Matthias Kusch, representing the Hilo area, asked Hurd, “Do you guys have any data you’re acting off of, for Hawaiʻi Island? Oʻahu has been referenced – data points, target areas. But has this happened on Hawaiʻi Island?”
Hurd launched into a discussion of the provision in Act 231 that called for spending $800,000 in tech upgrades. None of that had been spent, she said, because the state currently pays for the GIS program the department uses. “We’re holding onto [the funds] in the event that the software that we have needs upgrading to do exactly what you’re saying. We have the data. When we upload it, everyone will see where LFA is.”
“So, you’ve done surveys?” Kusch asked.
“Oh, definitely. We’ve done many surveys.”
“On Hawaiʻi Island?”
At this point, Jonathan Ho, plant quarantine manager for the DOA, jumped in.
“On Hawaiʻi Island? No.”
“So,” Kusch said, “$1.1 million, and the Terminix contract is just kind of a fishing expedition.”
“The contract is primarily focused on Oʻahu,” Ho said. “That’s where the bulk of the money is. One of the goals with the contract is to really get a baseline idea of how much you can get done with a particular set of money, through a commercial standpoint. Ultimately, you can then take that number and extrapolate it against all of Hilo… At least we will have a quantifier – to do the rest of Oʻahu, we can expect to need X dollars.”
Sen. Jarrett Keohokalole of windward Oʻahu questioned Hurd on the statements she made concerning fund expenditures.
“Director, you said the Terminix contract for LFA – you said the contract isn’t done yet. You’re still negotiating the scope of it,” he said. “So you can you encumber money on a contract that’s not done yet?”
Hurd replied, “The contract is in DAGS right now. It’s ready to go.” (DAGS is the Department of Accounting and General Services.)
“You don’t actually have a plan for how this private contractor is going to allocate the funds to do treatment,” he said, “even though the ISCs” – the island invasive species committees – “especially on Oʻahu, in coordination with the Ant Lab, have a pretty standardized protocol for how to treat infestations that has proven successful on Maui, in Mililani, and is underway in at least ten of the 66 sites on Oʻahu. You are aware of that, right?”
Hurd did not answer.
Referring to the slide Hurd had presented showing encumbrances, Keohokalole asked her, “Director did you intend to mislead the Legislature on how well you’re doing on Act 231 encumbrances?”
“If I did, it wasn’t intentional,” she said. “I can tell you what is encumbered. There’s a pest management systems contract – not contract, proposal – that we’re working on with the University of Hawaiʻi, so that to me is considered encumbered because the money is…”
Keohokalole: “Considered encumbered, or encumbered? Because if it’s encumbered and registered with the Department of Accounting and General Services as encumbered, then the money won’t lapse on June 30. Is that what you intend when you say, on your slide, that 52 percent is encumbered?”
“Right,” Hurd responded.
“So, director, I’m holding an email from Keith Regan, the comptroller and the director of the Department of Accounting and General Services, from 11:29 a.m. today. And what it says is that you have actually encumbered to date $1.1 million of Act 231 funding … and that you have spent zero dollars of that money to date. And we’re six months in, and every dollar of Act 231 money that is not spent by June 30 lapses back into the general fund. Is that correct?”
Hurd replied that she should have used the term obligated for pending arrangements. “When you encumber the funds, as what we’re doing with the contract, it’s encumbered, okay? Somebody has been awarded the funds.”
Which contract was Hurd referencing, Keohokalole asked.
“Let’s say HAL,” Hurd said. “It’s in DAGS right now. It’s in DAGS right now.
“Director, this email is from 11:29 a.m. From Keith Regan.”
“The comptroller is correct,” Hurd said, apparently agreeing with Keohokalole.
“The only funds that are encumbered are $1.1 million – 10 percent of the Act 231 monies – and we are halfway through the year,” Keohokalole said. “You’re 0 for 44 on your positions, and you’ve turned over four of your five managers that are responsible for invasive species in the last year. The only one that hasn’t turned over is still on probation. Things are going backwards right now.”
Hurd: “Let me, let me—”
But Keohokalole continued: “Was it your intention to mislead the Legislature about how well you’re doing because you’re at risk of lapsing 90 percent of the Act 231 monies?”
Hurd insisted she did not intend to mislead anyone and that any confusion was just a matter of definition – ““encumber, obligate, award, expend.”
“Obligate means nothing,” the senator replied. “It means you think you know where you want it to go. Award means they know that you think you know where it wants to go and that it’s supposed to go to them. Encumber means the money will not lapse in a year when you’re coming back to ask for $28 million more.”
Hurd repeated that the funds would be encumbered by the end of the fiscal year – all except, perhaps, those dealing with personnel.
Keohokalole wasn’t quite done with Hurd: “I just have trouble with the community having confidence in your ability to allocate and encumber and get all this money out the door when what we’re being told right now is not being validated by DAGS.”
Rep. Scot Matayoshi, representing Kaneʻohe and Mililani, told Hurd, “I’ll be honest. I’m pretty irritated. … This process has been going way too slow. I have no idea why Terminix was – or why you did not allow Hawaiʻi Ant Lab to bid on the RFP for little fire ants. To say it was liability is very confusing to me. As far as I know, HAL has been treating and has the equipment and expertise to do it. Unless you’re saying that they’ve been treating this whole time without proper insurance … then I’m not sure where your liability argument is coming from.”
He continued: “I’m being told Hawaiʻi Ant Lab can do it at about 10 percent of the cost. This is not only a huge waste of state funds in my opinion, but also just not using our own guys to treat. Why?
“I understand that sometimes we contract out when we don’t have the personnel to treat but here we’re literally ignoring the people who are government employees to do this. It doesn’t make any sense, and we’re paying ten times the amount in order to do it.
“To me not only is that government waste, but it means we’re not treating to the extent that we could by a very large margin. And when you have the kind of infestations like we have in our communities, we need every house we can get to be treated. So this kind of waste is very, very disturbing to me…
“Hawaiʻi Ant Lab is ready to go. I’m not sure why we have Terminix, who’s asking for advice and trying to get their things in order in order to go out and treat when we have someone who’s actively treating in the community right now and needs the resources to expand that.”
Ho of the Plant Quarantine Branch once more came forward with the argument for liability. The issue isn’t whether HAL has the expertise, he said. But it’s small. “Terminix is this very large company. They have the people, and once the contract is issued and they are trained, we provide them with sites and they can start immediately…. HAL would need to do a little ramping up.”
Matayoshi then suggested that the RFP with Terminix is faulty. “There seem to be things missing from it,” he said. “Some disconnects here that need to be worked out. You pulled the other RFP because you forgot to put in loading. If it’s a matter of re-issuing this, it seems like you have grounds to reissue the RFP and broaden it to allow organizations like HAL to bid…. Can you pull the RFP and reissue it?”
Hurd insisted there was no reason to do that. “The proposal that came in was vetted by the committee, the procurement office. They met every term, every piece of the scope of the RFP. So why would we pull it?”
Matayoshi then asked Chelsea Arnott, executive director of the multi-agency Hawaiʻi Invasive Species Council, to talk about funding for the Hawaiʻi Ant Lab and the furloughs it has undergone as a result of the lack of hard funding from the state.
Arnott said that the majority of HAL employees are on the Big Island, with about one and a half on Oʻahu. The Hilo personnel “move across the islands to support communities across the state in LFA mitigation,” she added.
“Can they hit the ground running? Of course. They’re the ones who developed the monitoring and treatment control protocols… They are definitely the experts in the field who know this system and have been assisting not just communities but also state agencies and other organizations.”
Arnott praised what the Ant Lab has done and is continuing to do, albeit with reduced funding. “Because they have limited staff, they’ve been developing community action programs to enhance their capabilities… But we also need to increase the capacity of HAL so they can work more effectively across the state,” she said. At present, HAL’s entire program runs about $1.3 million a year for around 16 staff members, she added, and that includes equipment, general operations, and overhead.
Sen. Mike Gabbard of west Oʻahu asked Hurd if any funding from Act 231 was being directed toward the island invasive species councils and the Ant Lab.
“I can’t say if the ISCs are getting any dollars,” she replied. “We asked Hawaiʻi Ant Lab to submit a proposal. I threw out a number, that maybe they can submit a proposal for $75 thousand. We recently got a proposal from the University of Hawaiʻi at $150. So we’re looking at funding that. We have not yet begun the process.”
The Ant Lab is run as a project of the university’s Pacific Cooperative Studies Unit, but its funding comes from competitive or discretionary grants and donations.
Arnott went on to describe the Ant Lab as “a critical piece of not just LFA mitigation, but other invasive ants. And they are soft-funded, like the island invasive species committees. We’re trying to find a way to institutionalize them, give them long-term, stable funding.”
Hurd noted the DOA had supported the Ant Lab in the past. From 2014 to 2021, she said, the department had awarded it funds totaling just over $3 million, money that came from the fee the DOA collects on incoming cargo. “So, yeah, we’ve been collaboratively funding each other,” she said.
— Patricia Tummons
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