Usually, when a state board or commission is asked to make a decision, its staff will prepare a background report. In the case of the Board of Land and Natural Resources, for example, the staff report can run to several pages and have correspondence, maps, or other documents attached. The idea is to give the board members, and members of the public as well, information needed to allow it to come to an informed decision.
When the Hawai`i Green Infrastructure Authority held its first meeting, on October 23, it was asked to approve the transfer of roughly $144 million in proceeds from the Green Energy Market Securitization bond sale into an account at the Bank of New York Mellon.
The HGIA approved the transfer of funds on the basis of a 442-word presentation from DBEDT staffer Cyd Miyashiro (now HGIA interim executive director). We reprint it in its entirety:
“Members of the Authority, the purpose of this request is to transfer approximately $144 million in net proceeds from the Green Infrastructure Special Fund to the GEMS Program Custodian – Bank of New York Mellon. Bank of New York Mellon is providing custodial services and acting as a paying agent for the Green Energy Market Securitization (GEMS) Program. The ~$144 million transfer from the special fund will allow Bank of New York Mellon to purchase GEMS loans originated by GEMS capital partners when instructed to do so by the HGIA. The reason Bank of New York Mellon is acting as GEMS’ paying agent for this program is because we anticipate GEMS to be making weekly loan purchases and money transfers to a number of GEMS capital partners, a task that would be difficult for the Department of Accounting and General Services to fulfill.
“The approximately $144 million held by Bank of New York Mellon will be in accounts in the name of the State of Hawai`i, Hawai`i Green Infrastructure Authority. We currently estimate the amount to be deployed as loans to be approximately $144 million, net of bond issuance costs and administrative costs for the operations of the Hawai`i Green Infrastructure Authority.
“To reiterate, the $144 million will be held at Bank of New York Mellon in accounts belonging to the State of Hawai`i, Hawai`i Green Infrastructure Authority. This one time transfer is needed to facilitate the day to day operations of deploying GEMS loans because it would not be practical for the Department of Accounting and General Services to be doing weekly money transfers to multiple GEMS capital partners. The money residing in the Bank of New York Mellon still belongs to the Hawai`i Green Infrastructure Authority.”
Environment Hawai`i asked to see the contract with the bank, but it had not been provided by press time. However, DBEDT Energy Office communication officer Alan Yonan stated that the bank is charging HGIA a fixed annual administrative fee of $1,900, which includes 72 “complimentary” wire transfers per year. Additional transfers will be charged at a rate of $25 each.
Yonan also said that the bank is paying interest at a rate of 1/100 of a percent a year. “The estimated annual return on the current balance in the account is $14,325,” he added.
— Patricia Tummons