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S. HRG. 111–831 

AMERICAN RECOVERY AND REINVESTMENT ACT 

OF 2009: INVESTMENT IN HAWAII 

HEARING 

BEFORE THE

COMMITTEE ON APPROPRIATIONS 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

SPECIAL HEARING 

JULY 7, 2010—HONOLULU, HI 

Printed for the use of the Committee on Appropriations 

( 

Available via the World Wide Web: http://www.gpo.gov/fdsys 
(II) 

COMMITTEE ON APPROPRIATIONS 

DANIEL K. INOUYE, Hawaii, Chairman 

ROBERT C. BYRD, West Virginia 

PATRICK J. LEAHY, Vermont 

TOM HARKIN, Iowa 

BARBARA A. MIKULSKI, Maryland 

HERB KOHL, Wisconsin 

PATTY MURRAY, Washington 

BYRON L. DORGAN, North Dakota 

DIANNE FEINSTEIN, California 

RICHARD J. DURBIN, Illinois 

TIM JOHNSON, South Dakota 

MARY L. LANDRIEU, Louisiana 

JACK REED, Rhode Island 

FRANK R. LAUTENBERG, New Jersey 

BEN NELSON, Nebraska 

MARK PRYOR, Arkansas 

JON TESTER, Montana 

ARLEN SPECTER, Pennsylvania 

THAD COCHRAN, Mississippi 

CHRISTOPHER S. BOND, Missouri 

MITCH MCCONNELL, Kentucky 

RICHARD C. SHELBY, Alabama 

JUDD GREGG, New Hampshire 

ROBERT F. BENNETT, Utah 

KAY BAILEY HUTCHISON, Texas 

SAM BROWNBACK, Kansas 

LAMAR ALEXANDER, Tennessee 

SUSAN COLLINS, Maine 

GEORGE V. VOINOVICH, Ohio 

LISA MURKOWSKI, Alaska 

CHARLES J. HOUY, Staff Director 

BRUCE EVANS, Minority Staff Director 
(III) 

C O N T E N T S 

Page 

Opening Statement of Chairman Daniel K. Inouye .............................................. 1 

Statement of Senator Daniel K. Akaka ................................................................. 2 

Statement of Brigadier General Darrell K. Williams, Director, Logistics, Engineering and Security Assistance J4, U.S. Pacific Command, Department 

of Defense ............................................................................................................. 2 

ARRA Funds ............................................................................................................ 3 

Prepared Statement of Brigadier General Darrell K. Williams .......................... 4 

Department of the Navy .......................................................................................... 5 

Department of the Army ......................................................................................... 5 

ARRA Civil Works Projects in Hawaii ................................................................... 5 

Department of the Air Force ................................................................................... 5 

Department of Defense (except military departments) ........................................ 5 

Statement of Brennon T. Morioka, Director, Department of Transportation, 

State of Hawaii ..................................................................................................... 6 

Prepared Statement of ..................................................................................... 9 

Statement of William J. Guerin, Recovery Executive, National Recovery Program Management Office, Public Buildings Service, General Services Administration .......................................................................................................... 14 

Prepared Statement of ..................................................................................... 16 

Statement of William F. Broglie, Chief Administrative Officer, National Oceanic and Atmospheric Administration, Department of Commerce .................. 19 

Prepared Statement of ..................................................................................... 21 

Report by Quarters .................................................................................................. 23 

Oversight .................................................................................................................. 24 

Project Status ........................................................................................................... 26 

Kona Project ............................................................................................................. 27 

Child Development Center on Marine Corps Base ............................................... 28 

Reporting Process .................................................................................................... 29 

Statement of Steve Robertson, Executive Vice President and Chief Information officer, Hawaii Health Information Exchange ........................................... 30 

Prepared Statement of ..................................................................................... 32 

Hawai‘i HIE Board Members .................................................................................. 33 

Statement of Dr. Karen Pellegrin, Ph.D., M.B.A., Director, Continuing/Distance Education and Strategic Planning, College of Pharmacy, University 

of Hawaii at Hilo .................................................................................................. 34 

Prepared Statement of ..................................................................................... 35 

Statement of Clyde S. Sonobe, Administrator, Cable Television Division, Department of Commerce and Consumer Affairs, State of Hawaii ...................... 39 

Prepared Statement of ..................................................................................... 40 

Statement of Dr. David Lassner, Vice President for Information Technology 

and Chief Information Officer, University of Hawaii ........................................ 41 

Prepared Statement of ..................................................................................... 43 

Statement of Su Shin, Vice President, Gold Ivory, LLC ...................................... 46 

Prepared Statement of ..................................................................................... 48 

Statement of John Komeiji, Senior Vice President and General Counsel, Hawaiian Telcom ....................................................................................................... 50 

Prepared Statement of ..................................................................................... 51 

Project Summary ..................................................................................................... 51 

Need for BTOP and BIP Projects ........................................................................... 52 

Benefits to Big Island Residents and Businesses ................................................. 52 

Why Hawaiian Telcom’s Applications Should be Funded .................................... 52 
Page

IV 

Statement of Maria Tome, Renewable Energy Program Manager, State Energy Office, Hawaii Department of Business, Economic Development & 

Tourism ................................................................................................................. 58 

Prepared Statement of ..................................................................................... 60 

Hawaii’s Total Energy Formula Funding Under ARRA ....................................... 60 

Strategic Approach for Building the Expenditure Plan ....................................... 62 

Formula Funding Project Expenditure Plan and Status ...................................... 62 

USDOE Recovery Act Projects ................................................................................ 70 

Statement of Leon Roose, Manager, Systems Integration, Hawaiian Electric 

Company ............................................................................................................... 71 

Prepared Statement of ..................................................................................... 73 

Statement of Jim Rekoske, Vice President and General Manager, Renewable 

Energy and Chemicals, Honeywell UOP ............................................................ 75 

Prepared Statement of ..................................................................................... 77 

Statement of Michael V. Yamane, P.E., Manager, Engineering, Kauai Island 

Utility Cooperative ............................................................................................... 78 

Prepared Statement of ..................................................................................... 78 

Statement of Jane Sawyer, District Director, Hawaii District Office, Small 

Business Administration ..................................................................................... 81 

Prepared Statement of ..................................................................................... 83 

Statement of Shelley Wilson, President, Wilson Homecare ................................. 84 

Prepared Statement of ..................................................................................... 85 

Statement of Brad Albert, Owner, Rising Sun, LLC ............................................ 86 

Prepared Statement of ..................................................................................... 88 

Economic Impact of Treasury Grant Program Extension in Hawaii ................... 89 

Extend the Treasury Grant Program ..................................................................... 91 

The Solar Manufacturing Jobs Creation Act ......................................................... 92 

About the Solar Energy Industries Association .................................................... 94 

Prepared Statement of Abraham Y. Wong, Administrator, Hawaii Division, 

Federal Highway Administration, Department of Transportation .................. 97 

Recovery Act Impact in Hawaii .............................................................................. 97 

Transparency, Accountability, and Risk Management ......................................... 99 

Prepared Statement of Laura M. Dierenfield, Chair, Safe Routes to School 

National Partnership, Hawaii State Network ................................................... 99 

The Need for Bicycle and Pedestrian Investments in Hawaii ............................. 99 

Bicycling and Walking Belong in Hawaii’s Clean Energy Future ....................... 100 

Prepared Statement of Susan Miller ..................................................................... 101 
(1) 

AMERICAN RECOVERY AND REINVESTMENT 

ACT OF 2009: INVESTMENT IN HAWAII 

WEDNESDAY, JULY 7, 2010 

U.S. SENATE, 

COMMITTEE ON APPROPRIATIONS, 

Honolulu, HI. 

The committee met at 9:35 a.m., in room 325, Hawaii State Capitol Building, Honolulu, Hawaii, Hon. Daniel K. Inouye (chairman) 

presiding. 

Present: Senator Inouye. 

Also present: Senator Akaka. 

OPENING STATEMENT OF CHAIRMAN DANIEL K. INOUYE

Chairman INOUYE. The committee will come to order. Aloha. 

AUDIENCE. Aloha. 

Chairman INOUYE. Almost 1 year ago, we convened in this room 

to discuss the impact of the stimulus bill, the so-called American 

Recovery and Reinvestment Act of 2009 (ARRA). At that time, I 

promised to conduct a follow-up hearing to learn about the progress 

that was made in Hawaii by the investment that comes from this 

act. 

I’m happy to report that this act continues to create and protect 

jobs and make investments in America’s future. To date, more than 

$1.8 billion has been awarded to projects in Hawaii, and this act 

is also delivering transparency, accountability to guarantee that all 

taxpayer money is invested wisely. 

When the Congress passed this act, we recognized that recovery 

from the economic crisis we inherited would not happen overnight, 

and that the Recovery Act was just the beginning. And since that 

time, Congress has pursued additional measures to build upon this 

act and creates jobs, as this Nation continues to recover from the 

worse financial crisis since the Great Depression. 

Today, I’m here to learn about how funds awarded to Hawaii 

have been spent. How many jobs have been created, or retained, 

and the successes and challenges along the way. 

And we’ll hear from five panels. The first panel will focus on investments on transportation, infrastructure, and Federal facilities. 

The second panel will discuss investments to improve delivery of 

health. The focus of the third will be the importance of investments 

in broadband infrastructure. The fourth will review investments in 

energy programs, and finally, investments in small businesses will 

be the topic of the fifth panel. 
2 

And I wish to thank all of the witnesses for taking time to share 

their progress and experiences with the committee, and without objection, your full statements will be made part of the record. 

Before I call upon the panel, may I call upon my colleague, Senator Akaka, for his words of wisdom? 

STATEMENT OF SENATOR DANIEL K. AKAKA

Senator AKAKA. Thank you very much, Mr. Chairman. I appreciate your conducting the hearing today and all of your extraordinary efforts to improve the lives of our constituents, and really 

the lives of all Americans. 

While States’ residents have suffered due to the difficult economic conditions, too many families have had their hours and pay 

reduced, suffered from a layoff, bankruptcy, and inability to obtain 

affordable credit, or the elimination of State funding for an important social service program. 

The American Recovery and Reinvestment Act is helping to considerably improve the lives of working families in Hawaii. The 

stimulus has created jobs, strengthened infrastructure, encouraged 

innovation in the development of alternative energy resources and 

bolstered education, social services and healthcare programs. 

This hearing will help provide a better understanding of how 

stimulus resources are being utilized in Hawaii and demonstrate 

the impact that these resources have had in our communities. 

I welcome all of our witnesses and look forward to hearing your 

testimony. 

Thank you, again, Mr. Chairman. 

Chairman INOUYE. I thank you very much. 

Our first panel consists of Brigadier General Darrell Williams of 

the United States Army. Welcome, sir. Mr. Brennon Morioka of the 

Hawaii Department of Transportation; Mr. William Guerin—is that 

correct pronunciation? 

Mr. GUERIN. Yes. 

Chairman INOUYE. Executive, Recovery Program Management 

Office, General Services Administration; and Mr. William Broglie, 

Chief Administrative Officer, National Oceanic and Atmospheric 

Administration. 

And may I call upon General Williams. 

STATEMENT OF BRIGADIER GENERAL DARRELL K. WILLIAMS, DIRECTOR, LOGISTICS, ENGINEERING AND SECURITY ASSISTANCE J4, 

U.S. PACIFIC COMMAND, DEPARTMENT OF DEFENSE 

General WILLIAMS. Mr. Chairman, Senator Akaka. On behalf of 

United States Pacific Command, I am pleased to appear before you 

today to provide an overview of the Department of Defense support 

to the American Reinvestment and Recovery Act of 2009 in Hawaii. 

The Department of Defense (DOD) received approximately $208 

million in ARRA funds for 112 projects in the State of Hawaii. All 

DOD projects have been awarded and 42 projects are completed. 

DOD has also received more than $110 million to award for four 

non-DOD project. Three projects have been awarded, with one 

project completed. The last project will be awarded by September 

2010. 
3 

Overall, the Department of Defense will award more than $318 

million in ARRA funds in the State of Hawaii. As a result of the 

AARA funds, contractors have identified more than 400 recoveryfunded jobs, according to the most recent reporting period, ending 

March 31, 2010. 

I will now provide a summary of the ARRA program, based upon 

funds received by each service, to include the non-Department of 

Defense contracts being executed by the Navy and the Army. 

Now, on the Department of the Navy. The Department received approximately $77 million of the $208 million of ARRA funds for 

five projects on Oahu and two projects on Kauai. All seven projects 

have been awarded. Projects included $22 million to repair wharfs 

at Joint Base Pearl Harbor Hickam, $20.7 million to repair the 

runway at Pacific Missile Range Facility in Kauai, $21.9 million to 

install photovoltaic, or solar energy systems in Oahu and Kauai, 

and a new $9.6 million child development center at Marine Corps 

Base Hawaii. 

Naval Facilities Engineering Command, Pacific, or NAVFAC also 

administers non-Department of Defense projects located on Navy 

property. The Department awarded a $6.2 million visitor parking 

center at the Arizona Memorial for the Department of the Interior. 

No later than September 2010 NAVFAC Pacific is projecting to 

award a research lab and regional headquarters for the National 

Oceanic and Atmospheric Administration (NOAA), which is part of 

the Department of Commerce. That project is over $100 million, 

and my colleague from NOAA will discuss that project, in detail. 

Overall, the Navy awarded $83.1 million in projects, which account for 128 recovery-funded jobs to date, and all but one project 

was awarded to companies headquartered in Hawaii. 

ARRA FUNDS

For the Department of the Army. The Army Corps of Engineers, Honolulu District received approximately $36.6 million of the $208 

million of ARRA funds for 24 facilities sustainment, restoration and 

modernization projects. All 24 projects have been awarded. Army 

projects include $9.9 million for projects to install photovoltaic cells 

and $2.9 million to repair various bridges. All of the projects were 

awarded to small businesses. 

The Director of Public Works, U.S. Army Garrison Hawaii received approximately $34.6 million of the $208 million for 35 

projects. All 35 projects have been awarded. 

Projects include $10.4 million for road repairs, $3.4 million for 

roof repairs on six buildings, and $6.7 million for runway and 

apron repair. These Army projects accounted for 164 recovery jobs 

to date, and all but four projects were awarded to Hawaii-based 

companies. 

Under the category of ARRA civil works projects in Hawaii, the 

Corps of Engineers also executes non-Department of Defense work 

under their civil works authorities to develop, manage, protect and 

enhance our Nation’s water and related land resources for commercial navigation, flood risk management, ecosystem restoration, and 

allied purposes. Through the civil works authorities, the Department also provides emergency services for disaster relief and administers the Army’s regulatory program. 
4 

The Honolulu District received $825,000 in ARRA funds for two 

operations and maintenance projects and funding for their regulatory program. Both projects have been awarded, including 

$700,000 for maintenance dredging of the Haleiwa Harbor, which 

was completed in January 2010. The regulatory program obligated 

approximately $70,000 in ARRA funds. These projects accounted 

for an additional four jobs. 

For the Department of the Air Force. The Department received 

approximately $49.6 million of the $208 million for 36 projects at 

Joint Base Pearl Harbor Hickam and Kaena Point. All projects 

have been awarded. 

Projects include $30 million in renovations for a new headquarters facility, $4 million for utility infrastructure upgrades and 

$8 million in pavement and building exterior improvements. Overall, the Air Force projects account for 100 recovery-funded jobs to 

date. All but one of the Air Force projects was awarded to Hawaiibased companies. 

Under the category Department of Defense, except for military 

departments, Tripler Army Medical Center received approximately 

$10.6 million of the $208 million for eight projects. All eight 

projects have been awarded. Projects include $8.6 million for utility 

systems upgrades, and $600,000 to replace an elevator. Overall, 

these projects account for approximately four recovery-funded jobs, 

to date. 

So, in conclusion Mr. Chairman, the Department of Defense has 

awarded over $208 million of ARRA funds for 112 DOD projects 

and $7 million for three non-DOD projects. By the end of the fiscal 

year, one additional project will be awarded for over $100 million 

which will bring our final total to well over $318 million. Of the 

projects awarded, 98 of the 116 were awarded to Hawaii-based 

companies. The Department of Defense, through ARRA funds, assisted you to spur economic activity with over 400 recovery-funded 

jobs to date. At the same time, this funding certainly enhanced the 

readiness of our military services. 

Thank you for your continued support of our Armed Services and 

thank you for the opportunity to provide this statement today. 

Chairman INOUYE. I thank you very much, General. 

[The statement follows:] 

PREPARED STATEMENT OF BRIGADIER GENERAL DARRELL K. WILLIAMS

Mr. Chairman, I am pleased to appear before you today to provide an overview 

of the Department of Defense’s support of the American Reinvestment and Recovery 

Act (ARRA) of 2009 in Hawaii. 

The Department of Defense (DOD) received approximately $208 million in ARRA 

funds for 112 construction projects in the state of Hawaii. All DOD projects have 

been awarded and 42 projects are complete. DOD has also received more than $110 

million to award four non-DOD projects. Three projects have been awarded with one 

project completed. The last project will be awarded by September 2010. Overall the 

Department of Defense will award more than $318 million in ARRA funds in the 

state of Hawaii. As a result of the ARRA funds, contractors have identified more 

than 400 recovery funded jobs according to the most recent reporting period ending 

March 31, 2010. 

I will now provide a summary of the ARRA program based upon funds received 

by each service to include the non-Department of Defense contracts being executed 

by the Navy and the Army. 
5 

DEPARTMENT OF THE NAVY

The Department received approximately $77 million of the $208 million in ARRA 

funds (DOD) for five projects on Oahu and two projects on Kauai. All seven projects 

have been awarded. Projects include $22 million to repair wharves at Joint Base 

Pearl Harbor Hickam, $20.7 million to repair the runway at Pacific Missile Range 

Facility (PMRF), Kauai, $21.9 million to install photovoltaic (solar energy) systems 

on Oahu and Kauai, and a new $9.6 million child development center at Marine 

Corps Base Hawaii. 

Naval Facilities Engineering Command, Pacific (NAVFAC Pacific) also administers non-Department of Defense projects located on Navy property. The Department awarded a $6.2 million Visitor Parking Center at the Arizona Memorial for 

the Department of the Interior. No later than September 2010 NAVFAC Pacific is 

projecting to award a research lab and regional headquarters for the National Oceanic and Atmospheric Administration (NOAA) which is part of the Department of 

Commerce for over $100 million. 

Overall the Navy awarded $83.1 million in projects which account for 128 recovery funded jobs to date. All but one project was awarded to companies 

headquartered in Hawaii. 

DEPARTMENT OF THE ARMY

The Army Corps of Engineers, Honolulu District received approximately $36.6 

million of the $208 million in ARRA funds for 24 Facilities Sustainment, Restoration 

and Modernization projects. All 24 projects have been awarded. Army projects include $9.9 million for projects to install photovoltaic cells and $2.9 million to repair 

various bridges. All of the projects were awarded to small businesses. 

The Directorate of Public Works, U.S. Army Garrison Hawaii received approximately $34.6 million of the $208 million in ARRA funds for 35 projects. All 35 

projects have been awarded. Projects include $10.4 million for road repairs, $3.4 million for roof repairs on six buildings, and $6.7 million for runway and apron repair. 

These Army projects accounted for 164 recovery funded jobs to date. All but four 

projects were awarded to Hawaii-based companies. 

ARRA CIVIL WORKS PROJECTS IN HAWAII

The Corps of Engineers also executes non-Department of Defense work under 

their Civil Works authorities to develop, manage, protect and enhance our Nation’s 

water and related land resources for commercial navigation, flood risk management, 

ecosystem restoration and allied purposes. Through the Civil Works authorities, the 

Department also provides emergency services for disaster relief and administers the 

Army’s regulatory program. 

The Honolulu District received $825,000 in ARRA funds for two Operations and 

Maintenance projects and funding for their Regulatory program. Both projects have 

been awarded including $700,000 for maintenance dredging of Haleiwa Harbor 

which was completed in January 2010. The Regulatory Program obligated approximately $70,000 in ARRA funds. These projects accounted for an additional 4 jobs. 

DEPARTMENT OF THE AIR FORCE

The Department received approximately $49.6 million of the $208 million in 

ARRA funds for 36 projects at Joint Base Pearl Harbor Hickam and Kaena Point. 

All projects have been awarded. Projects include $30 million in renovations for a 

new headquarters facility, $4 million for utility infrastructure upgrades and $8 million in pavement and building exterior improvements. Overall the Air Force projects 

account for roughly 100 recovery funded jobs to date. All but one of the Air Force 

projects was awarded to Hawaii-based companies. 

DEPARTMENT OF DEFENSE (EXCEPT MILITARY DEPARTMENTS)

Tripler Army Medical Center received approximately $10.6 million of the $208 

million in ARRA funds for 8 projects. All 8 projects have been awarded. Projects include $8.6 million for utility system upgrades and $600,000 to replace an elevator. 

Overall these projects account for approximately 4 recovery funded jobs to date. 

CONCLUSION

Mr. Chairman, in total, the Department of Defense has awarded over $208 million 

of ARRA funding for 112 DOD projects and $7 million for three non-DOD projects. 

By the end of the fiscal year one additional project will be awarded for over $100 

million which will bring our final total well over $318 million. Of the projects 
6 

awarded, 98 of 116 were awarded to Hawaii-based companies. The Department of 

Defense through ARRA funds assisted you to spur economic activity with over 400 

recovery funded jobs to date. At the same time this funding enhanced the readiness 

of our military services. Thank you for your continued support of our Armed Services and thank you for the opportunity to provide this statement today. 

Chairman INOUYE. Before we proceed with questioning, I’d like 

to hear from the whole panel. 

So, may I call upon Mr. Morioka? 

STATEMENT OF BRENNON T. MORIOKA, DIRECTOR, DEPARTMENT OF 

TRANSPORTATION, STATE OF HAWAII 

Mr. MORIOKA. Thank you, Mr. Chairman Inouye, Senator Akaka, 

Brennon Morioka, on behalf of the State Department of Transportation here in Hawaii. And we are very pleased to provide you with 

testimony on the current status and accomplishments of the State 

of Hawaii and utilizing funds provided by the American Recovery 

and Reinvestment Act for transportation purposes. 

We are extremely grateful for the additional funds that came to 

Hawaii provided by this act. As you mentioned, it did go to help 

contractors, suppliers and local companies in these tough economic 

times and to allow them to either retain employees, or bring some 

of them back who were sitting on the bench and currently not getting a paycheck. And so we do believe that this was one of the ways 

to help our local economy, but also help the local families. 

The stimulus funds have helped significantly in supporting Hawaii’s efforts to focus on investing in our transportation infrastructure, create jobs and stimulate our economy. And based on the requirements in developing the number of jobs that were either sustained or created, Hawaii reported approximately 2,300 jobs that 

were created or funded by ARRA through the transportation program here in Hawaii. 

As you are aware, determining which State and county projects 

would be funded through this unprecedented level of funding to the 

State required a significant amount of coordination and collaboration between all of our agencies, both the Federal highways administration, the State Department of Transportation, and our four 

counties, especially the four mayors and their transportation directors. 

We also worked very closely with your office, Senator, as well as 

the staff of the other congressional delegation. And so we’re very 

thankful for all of the support and guidance that we received 

throughout the entire process. 

Due to the strong level of collaboration between Federal, State 

and county agencies, we do believe and we are of the opinion that 

Hawaii has one of the most diverse lists of projects funded by the 

ARRA transportation monies. And it was also important to ensure 

that these monies were distributed equally, fairly, through geographic and economically distressed areas. 

So, in order to do that, we did meet extensively with all four 

counties, especially the mayors, directly, in order to discuss and 

identify the projects that we would move forward, statewide. We 

did have to meet certain requirements, and the four counties received approximately one-half of the stimulus funds, which is usually more than what they typically get in terms of the formula 

monies that we receive annually, so we did place a big focus on as-
7 

sisting our county partners, and making sure that their infrastructure projects were able to be funded, as well. 

The selection process included meeting certain criteria, including 

meeting the ARRA timelines; focusing on economically distressed 

areas, such as the Big Island and Molokai; within the State, we 

made a conscious decision to make sure that we focused on trying 

to select projects that had a more diverse nature, in terms of the 

various trades to be used, so that we did not focus on the same 

trade, that we would be able to spread the work and employment 

opportunities out to as many of our trade unions as possible; and 

we worked on providing secondary benefits such as promoting future job growth such as low-cost housing, as an example, the MidLevel Road in Kona was one that is a project that could open up 

for future development and future employment opportunities in the 

Kona area. 

We also took into account the selection of the projects that would 

employ people over a much longer period of time. We looked at construction projects that would last approximately 2 to 3 years, rather than just 2 to 3 months. And I think when you start comparing 

the percentages of funds that Hawaii used for such projects such 

as resurfacing, which is a very quick and easy project to do, nationally other States used approximately 49 percent of their ARRA 

funds on resurfacing. But, in our case, we used only approximately 

14 percent of our funds on resurfacing. Because we did want to 

focus on the projects that would employ people through this economic condition, and get us through that period, rather than just 

have them employed for 2 or 3 months, and then go back on the 

unemployment roles and then we’re back in the same problem. 

So, we do believe that our—we are very proud of the list collective—that we collectively put together, and I think our residents 

are beneficiaries of that, by having employment as well as allowing 

us to catch up on much of our significant backlogs on infrastructure 

demands. 

So, of the highway projects, Hawaii received approximately $126 

million in highway monies. There were a total of 24 highway 

projects, 14 State, 10 county that were selected for implementation. 

Six out of the 14 State projects have been completed and 4 are currently in active construction. There are three other projects that we 

have for the State that have been issued and for those to proceed, 

the contractors are starting to process their material orders and 

their permits. 

Five out of the 10 counted projects already have been issued notice to proceed, and will be continuing to be worked on. Three are 

in the process of being issued notice to proceed within this month 

of July, and two other county projects will be advertised very shortly. 

So, as a result of many of the favorable bids that we had from 

the original list of the 24 projects, we were able to add four additional State projects and two additional projects on Maui County. 

We also received monies for airport infrastructure. We received 

two Transportation Security Administration (TSA) grants and one 

Airport Improvement Program (AIP) grant from the Federal Aviation Administration (FAA). The first one was the AIP grant for $15 

million for a $17 million to make improvements to the apron pave-
8 

ment at Kahului Airport of which we are approximately 78 percent 

complete with the project. 

The two TSA grants which we are very grateful for the assistance of your offices in helping Hawaii be 1 of 11 States who received TSA grants for airport improvements, both of them are for 

explosion detection systems. One at Kahului Airport which we have 

currently completed—we just recently dedicated the systems, about 

1 month ago. That was $7.2 million of ARRA funds out of a $24 

million project. And we are about to issue a notice to proceed in 

this month for the Honolulu International Airport EDS project, 

which is a $64 million project, of which $25 million will be paid for 

out of ARRA. 

We were also very grateful to receive a TIGER grant which was 

done through a competitive process. We worked very closely with 

your office, Mr. Chairman, in working on positioning Hawaii on receiving this grant. 

We submitted a single grant with three harbor projects for—we received $24.5 million for one of the projects, which is a Pier 29 reconstruction, here in Honolulu Harbor. We also, as part of the 

grant, we had also put in for improvements to Pier 4 in Hilo, and 

Pier 2A out in Kahului Harbor. And so, as a part of the upcoming 

TIGER applications, we will be resubmitting those two projects, as 

well, and hopefully we will position ourselves, once again, on receiving monies for those harbor projects. 

Hawaii also received Federal Transportation Administration 

(FTA) monies of which we were, Department of Transportation 

(DOT) was primarily a pass-through and assisted the four counties 

on the use of those funds. Most of those monies were primarily 

used to—on the Big Island they were used for construction of bus 

shelters, but also to expand their service by acquiring more buses 

to expand their services on the Big Island. 

On Kauai, they used it to replace some of their aging buses, as 

well as purchase new buses to expand their program, as well. And 

on Maui, they also used it to purchase new buses for the expansion 

of their services. 

In going through this whole ARRA process, we did have a few 

observations in working through it, because it was unanticipated 

monies, when you look over a long period of time and you budget 

out where your resources are going. So, this was a new influx of 

money with the same amount of resources that we had in terms of 

manpower, so it took a lot of prioritization on making sure that we 

focused our efforts on the highest priorities. And, obviously, that 

was getting the ARRA projects out, because they had the strictest 

amount of timelines to meet before—or else you would lose some 

of the monies. 

So, it did create some strain on our internal staff, but I think 

through the resiliency of much of our staff, and the coordination between the counties and our Federal partners, we were able to manage and prioritize and make sure that we met all of the deadlines 

that ARRA imposed on us, as well as maintaining our current and 

existing programs that we have to do every year, anyway. 

We do also understand the desire, and need for reporting and 

oversight for these additional monies but at the same time, this additional amount of paperwork also took away from some of the re-
9 

sources that is traditionally used to actually deliver the projects. 

So, I think that is something that we are going to have to look at 

internally, to see if this kind of oversight and reporting requirements are included in future legislation and authorizations that 

we’re going to also have to look at how we do business internally 

to make sure that we can accommodate those requirements, moving forward. 

One of our biggest concerns about some of the things that have 

happened through the ARRA process is that the additional oversight by some of the Federal agencies has—there is the perception 

of some of the—or reintroducing of some of the old barriers between the Federal agencies and the State DOTs across the country. 

This—you know, following a number of years of development of relationships between Federal highways and all of the State agencies, the State DOTs across the country—and even more so here in 

Hawaii, because I think we are very proud of the relationship that 

we have with our Division of Federal Highways here in Hawaii. I 

think we have worked through some of those issues as best as we 

can. I think the Division Administrator, A. Wong, has done the best 

that he has been able to do in terms of following the requirements 

of oversight that they have to have over the State agencies as well 

as the county agencies, but also providing us with as much of the 

flexibility as possible and not moving backwards in terms of some 

of the stewardship relationship that we have developed with Federal highways as we are both serving the same customers. We are 

both trying to achieve the same mission, and I think Mr. Wong 

definitely understands that, and he is doing his best to make sure 

that the relationship is done in a mutual way. But, we also understand, from the DOT’s perspective, that he also has his responsibilities for the oversight that needs to be. 

So, we’ll continue to work with Federal highways on making sure 

that we try and maintain that level of relationship and partnering, 

while still acknowledging and respecting the fact that oversight has 

to be had. 

So, in closing, I do want to thank you for the opportunity to brief 

you on the status of our use of the ARRA funds that have been provided to Hawaii, and also to thank you for all of the support and 

guidance that you, personally, have provided to us, as well as all 

of your staffs. Because I don’t think, without that cooperation, that 

Hawaii would not have been as successful as we have been. So, 

thank you very much. 

Chairman INOUYE. I thank you very much, Mr. Morioka. 

[The statement follows:] 

PREPARED STATEMENT OF BRENNON T. MORIOKA

The State Department of Transportation (DOT) is pleased to provide this testimony that outlines our current status and accomplishments in utilizing funds provided by the American Recovery and Reinvestment Act (ARRA) of 2009. 

We are extremely grateful for the additional funds that were provided by this act 

to the State of Hawaii as it helps contractors, suppliers and local companies in these 

tough economic times and to allow for the state and counties to embark on projects 

that may not have otherwise proceeded. The Federal stimulus funds have helped in 

supporting Hawaii’s efforts to focus on investing in the repair and modernization 

of Hawaii’s infrastructure, create jobs and stimulate our local economy. Stimulus 

funds created 2,317 jobs for transportation infrastructure in Hawaii. 
10 

Determining which state and county road projects would be funded required an 

unprecedented level of coordination and collaboration between the Federal Highway 

Administration, the state Department of Transportation, the four county mayors 

and their transportation directors, and the Oahu Metropolitan Planning Organization. We also worked closely with Senator Inouye and his staff and would like to 

thank them for their input and support. 

Projects were first evaluated on their ability to meet the ARRA milestone requirements. It was also important that we ensured the projects were fairly distributed 

geographically, including in economically distressed areas and other regions where 

the project would have an impact in the creation of jobs. We also put an emphasis 

on projects that had the potential to employ a diverse cross section of construction 

trades and provide such employment over a longer duration of time. 

A summary of the Department’s ARRA program is as follows: 

Selection of Highway Projects 

The selection of projects to be undertaken with ARRA funds was a result of a collaborative effort between the four counties and the State DOT to ensure an equitable distribution of ARRA funds. 

After a list of prospective county and state projects was compiled by DOT and the 

respective county agencies, we met with the Mayors of each county individually to 

discuss and identify projects statewide. 

The final selection of projects was based on the following criteria: 

—Projects: 

—That would meet the ARRA timelines; 

—In economically distressed areas (Hawaii and Molokai); 

—That would employ a diversity of trades; 

—That would provide secondary benefits in promoting future job growth such 

as low cost housing; 

—That would provide general transportation benefits to road and highway 

users. 

It should be noted that the counties received nearly half of the ARRA funds for 

ready-to-go projects, which is a far greater amount of funding typically provided 

through the typical formula funds of the Federal aid program. 

We also took into account the selection of projects that would employ people over 

a longer period of time (2–3 years) versus the approach taken by other jurisdictions 

that selected projects that were easy and quick to get out but would employ people 

over a shorter period of time (2–3 months). How Hawaii is investing taxpayer monies is important. We felt it important to make sure the investment of these funds 

would go towards extended employment and longer term benefits. 

We are aware that approximately 49 percent of ARRA funds spent for highway 

systems on a national level has or will be used on resurfacing projects. It is important to note that in comparison, only 14 percent of the ARRA funds apportioned to 

Hawaii is being used on resurfacing projects. 

Status of Highway Projects 

Currently, of the 24 (14 state and 10 local) original ARRA highway projects, 6 of 

the 14 state projects have already been completed and 4 are currently in construction. 

Because we were able to realize lower bid proposals for ARRA-funded projects, 

four more state road improvement projects have been added to the certified list. All 

four of these additional HDOT projects have already started construction. 

We also remain committed to provide assistance to Economically Distressed Areas 

(EDAs), in this case Molokai and the Big Island. 

Status of Airports Projects 

The Airports Division received 3 ARRA grants. The following is a project status 

report: 

—The structural improvements project for the apron pavement at Kahului Airport 

is 78 percent complete. The grant amount is $15 million. 

—The EDS integration improvements project at Kahului Airport is 100 percent 

complete. The grant amount is approximately $7.2 million. 

—Phase II of the EDS integration improvements project at Honolulu International 

Airport has an NTP date of July 19, 2010. The grant amount is approximately 

$24.6 million. 

Status of Harbors Project 

The Harbors Division received 1 TIGER grant. The following is a project status 

report. 
11 

—The reconstruction of Pier 29 has an NTP date of December 2010. The grant amount is $24.5 million and the estimated state match is $7 million. Received 

grant agreement from MARAD on July 2, 2010. Ready to commence project 

upon release and availability of funds. 

Status of FTA Projects 

The project to construct bus shelters on the Big Island is complete. The grant amount is $27,812. 

The project for additional bus shelters on the Big Island is 75 percent complete. The grant amount is $44,514. 

The project to purchase buses for expansion of services on the Big Island is 100 percent complete. The grant amount is $905,486. 

The bus replacement program on Kauai is 100 percent complete. The grant amount is $331,632. 

The project to purchase buses for expansion of services on Kauai is 100 percent complete. The grant amount is $646,180. 

The project to purchases buses for expansion of services on Maui is 98 percent complete. The grant amount is $977,811. 

Observations 

Through this process to meet the rigorous deadlines and stricter requirements imposed by the act, we did see the kind of resiliency and hard working individuals 

that we all posses within our agencies. We developed new strategies and innovative 

approaches to deliver projects faster, in light of some of the resource challenges we 

faced due to the economic climate of our state and our nation. 

However, with the addition of these unanticipated funds to further accelerate infrastructure initiatives, the challenges to deliver and perform were sometimes overwhelming and often made for difficult choices in order to distribute the necessary 

resources to meet the new initiatives while maintaining existing responsibilities. It 

needs to be recognized that the benefactor agencies needed to dedicate a significant 

amount of resources to manage, monitor, and fulfill the new Federal requirements 

that came with acceptance of these additional Federal funds. However, although the 

act did provide for allowance for this fact, it was not apparent that there was much 

flexibility provided or acknowledgement that every state is different in their laws 

and processes became enormous obstacles that needed to be overcome in order to 

succeed. 

Greater flexibility in working through Federal regulations would have assisted 

agencies in delivering projects more quickly. Strict compliance with all pre-existing 

requirements, though not necessarily critical to the delivery of a project but more 

applicable to the ‘‘process’’ by which they are delivered, such as the TIP and STIP 

processes, seemed to be contrary to the intent of the act to create and stimulate the 

economy in the quickest fashion possible. 

We also understand the desire for the amount of reporting and oversight control 

by our Federal agency partners, especially in light of much of the perception of a 

lack of oversight of financial institutions. However, the degree to which the reporting and oversight was required and/or requested also took away from the same resources necessary to deliver the projects themselves. This had a tremendous impact 

on Hawaii’s agencies as our good intentions to spread the work around to benefit 

the largest amount of stakeholders also resulted in a greater amount of paperwork. 

Reporting on three very large projects would have been far easier for agencies as 

compared to tracking and reporting on a two dozen smaller projects. Therefore, the 

incentive to distribute the ARRA funds more equitably did not exist and states that 

did distribute funds to a wider base were, in essence, penalized for doing so. 

One of our biggest concerns, however, has been that ARRA has reintroduced some 

of the barriers between the Federal agencies and the state DOTs. Following a number of years working toward stewardship agreements and partnering relationships, 

the oversight requirements imposed on FHWA and the local agencies have reestablished some of the perception that the role of FHWA will be more of a policing role 

rather than a partnering role. We are hopeful that this is not going to be the case 

moving forward and we will continue to work with our local division office towards 

that end as we believe we have built a trusting relationship with the local FHWA 

staff that we are currently proud of. 

Closing 

Thank you for providing us an opportunity to brief you on Hawaii’s efforts to use 

ARRA funds prudently and expeditiously. These projects demonstrate how the state, 

counties, and Federal agencies can work together to serve the critical needs of Hawaii’s residents and focus on investing in the repair and modernization of Hawaii’s 

transportation infrastructure and create jobs for the people in our state. 
12 

STATE AND COUNTY PROJECTS USING FEDERAL RECOVERY FUNDS 

Jurisd. Island Project Title ARRA Cost Notes or Remarks Status 6/30/2010 

S1 ................................... STATE ........ Oahu ......... H–1, Seismic Retrofit, Farrington Highway & Makakilo Separation, Oahu 5 ........................... $865,200 NTP 7/13/09 .......... Completed S2 ................................... STATE ........ Oahu ......... Kamehameha Highway, South Punaluu Bridge Replacement, Oahu 3 ..................................... $15,298,510 NTP 8/26/09 .......... 30 percent S3 ................................... STATE ........ Hawaii ....... Hawaii Belt Road, Clean & Paint Steel Members, Kukuaiu, Kuwaikahi, Ninole and Maulua 

Bridges, Hawaii 3.

$4,301,949 NTP 9/8/09 ............ 67 percent 

S4 ................................... STATE ........ Kauai ......... Maalo Road Resurfacing, MP 0–MP 1.0, Kauai 5 ..................................................................... $729,083 NTP 7/20/09 .......... Completed S5 ................................... STATE ........ Kauai ......... Kuhio Highway Resurfacing, Kawaihau Road to Kapaa Bridge, Kauai 5 ................................. $1,021,416 NTP 7/20/09 .......... Completed S6 ................................... STATE ........ Kauai ......... Kuhio Highway, Short Term Improvements, Kuamoo Road to Temporary Bypass Road 1 ........ 4 $17,000,000 $34 million total; 

$17 million ARRA.

Awaiting FHWA decision on Sect 

106 

S7 ................................... STATE ........ Maui .......... Piilani Highway Pavement Preservation, Lipoa Street to Kilohana, Maui 3 ............................. $2,979,480 NTP 8/31/09 .......... 91 percent S8 ................................... STATE ........ Maui .......... Hana Highway PPM, Kaupakalua Road to Huelo, Maui 5 ......................................................... $619,301 NTP 8/26/09 .......... Completed S9 ................................... STATE ........ Molokai ...... Maunaloa Highway Resurfacing, MP 5—Airport, Molokai 5 ..................................................... $2,688,406 NTP 8/26/09 .......... Completed S10 ................................. STATE ........ Molokai ...... Kalae Highway PPM, Maunaloa Highway to Kalaupapa Lookout, Molokai 5 ............................ $1,061,781 NTP 8/26/09 .......... Completed SBU1 ............................... STATE ........ Molokai ...... Puupeelua Hwy Resurfacing, Maunaloa Hwy to Farrington Ave & Farrington Hwy Resurfacing, Puupeelua Ave to Kalae Hwy (Route 480 Pavement Preservation), Molokai 3. $5,315,832 NTP 12/3/09 .......... 85 percent SBU2 ............................... STATE ........ Maui .......... Kaahumanu Ave, Waiale Bridge Girder Replacement, Maui 3 .................................................. $1,922,456 NTP 4/2/2010 ........ 0 percent SBU3 ............................... STATE ........ Oahu ......... H–1 Dowel Retrofit, Kaimuki and Palailai Areas, Oahu 3 ........................................................ $6,350,000 NTP 1/29/10 .......... 0 percent SBU4 ............................... STATE ........ Oahu ......... H–3 Seismic Retrofit, Mokapu I/C, Oahu 3 ............................................................................... $1,599,283 NTP 6/30/10 .......... 0 percent C1 ................................... COUNTY ..... Oahu ......... Traffic Signals at Various Locations, Phase 10 3 .................................................................... $3,407,221 NTP 12/21/09 ........ 1 percent C2 ................................... COUNTY ..... Oahu ......... Traffic Imp. At Various Locations, Harding Ave. and 5th & 11th Aves 3 ................................ $2,456,715 NTP 7/10 ................C3 ................................... COUNTY ..... Oahu ......... Waipio Point Access Road Improvements 3 .............................................................................. $3,585,927 NTP 7/10 ................C4 ................................... COUNTY ..... Oahu ......... Traffic Management Center Auxiliary Power Facility 3 .............................................................. $291,652 NTP 4/30/10 .......... 0 percent C5 ................................... COUNTY ..... Oahu ......... Kalaeloa Blvd Widening and Reconstruction, Phase 1 OR&L ROW to Lauwiliwili Street 3 ..... $6,773,817 NTP 7/10 ................C6 ................................... COUNTY ..... Hawaii ....... Ane Keohokalaoloe Highway, Hawaii 3 ...................................................................................... $28,541,891 NTP 3/29/10 .......... 5 percent C7 ................................... COUNTY ..... Kauai ......... Lydgate Park to Kapaa Bike/Ped Path (phase III) 1 ................................................................. 4 $4,120,000 ................................ Not advertised yet C8 ................................... COUNTY ..... Maui .......... Market Street Improvements, Phase 2 3 ................................................................................... $2,421,990 NTP 11/27/09 ........ 36 percent MCBU1 ............................ COUNTY ..... Maui .......... Resurfacing Various Roads, Ohukai and Kaniau 3 ................................................................... $409,558 NTP 4/12/10 .......... 94 percent MCBU2 ............................ COUNTY ..... Maui .......... Lower Main Street and Kanaloa Ave Slurry Sealing 1 .............................................................. 4 $1,000,000 BACKUP PROJECT .. Not advertised yet 

AIRPORT PROJECTS 

STATE ........ Maui .......... Apron Pavement Structural Improvements, Kahului Airport 3 .................................................. $15,000,000 NTP 6/16/09 .......... 78 percent complete STATE ........ Maui .......... OGG EDS Integration Improvements, Kahului Airport 3 ............................................................ $7,240,743 NTP 5/15/08 .......... Completed STATE ........ Oahu ......... HNL EDS Integration Improvements, Phase II, Honolulu International Airport 2 ...................... $24,573,200 NTP 7/19/10 ..........
13 

HARBOR PROJECT 

T1 .................................... STATE ........ Oahu ......... Reconstruction of Pier 29 Container Yard, Honolulu Harbor 2 ................................................. $24,500,000 $31.5 million total; 

$24.5 million ARRA.

Going through 

Award process. Received grant agreement from MARAD on 7/2/ 10. 

TRANSIT PROJECTS 

HC19 ............................... COUNTY ..... Hawaii ....... Construct Bus Shelters 5 ........................................................................................................... $27,812 Contract awarded 

9/30/09.

Completed 

HCBU 1 ........................... COUNTY ..... Hawaii ....... Additional Bus shelters 3 .......................................................................................................... $44,514 BACKUP PROJECT .. 75 percent HC21 ............................... COUNTY ..... Hawaii ....... Purchase Buses for Expansion of Services 5 ............................................................................ $905,486 Contract awarded 

9/30/09.

Completed 

KC24 ............................... COUNTY ..... Kauai ......... Bus Replacement Program5 ..................................................................................................... $331,632 Contract awarded 

6/28/09.

Completed 

KC25 ............................... COUNTY ..... Kauai ......... Purchase Buses for Expansion of Services 5 ............................................................................ $646,180 Contract awarded 

6/28/09.

Completed 

MC53 .............................. COUNTY ..... Maui .......... Purchase Buses for Expansion of Services 3 ............................................................................ $977,811 Contract awarded 

6/30/09.

98 percent 

1 Obligated. 2 Estimated cost. 3 Advertised/opened bids but have not issued NTP. 4 Completed. 5 Currently in construction. 
14 

Chairman INOUYE. And now I’m going to call upon Mr. Guerin 

of the General Services Administration. 

STATEMENT OF WILLIAM J. GUERIN, RECOVERY EXECUTIVE, NATIONAL RECOVERY PROGRAM MANAGEMENT OFFICE, PUBLIC 

BUILDINGS SERVICE, GENERAL SERVICES ADMINISTRATION 

Mr. GUERIN. Good morning, Mr. Chairman, Senator Akaka. 

Thanks for the opportunity for GSA to come and talk about what 

we’ve accomplished for economic recovery here and across the country. We have received funding in $130 million or more for two 

projects in Hawaii, the Federal building here and the Federal 

building courthouse in Hilo. Both of those projects are underway, 

but I’d like to first talk about what we’ve accomplished generally 

before I get into some specifics about those two projects. 

We submitted our first spend plan to fund projects in March 30, 

2009 based on two overwhelming criteria: the potential to put people back to work quickly, and the opportunity for us to transform 

our Federal buildings into high-performance green buildings. 

As we’ve realized savings from projects underway, we have revised our spending plans to reallocate funding. These savings were 

used to enhance or accelerate construction of existing projects, or 

to fund new projects. Today, we have revised our spending plan 

four times, and the latest version of that is actually in Congress, 

now, being reviewed and will be available for us to spend money 

on Friday of this week. 

Our objective is to deliver projects on-schedule, on-budget, and 

on-green. We established aggressive targets to fulfill the intentions 

of the Recovery Act. As of June 28, we’ve obligated over $4.3 billion of recovery money to over 500 companies, and we’ve spent over $485 million of that 

money already. We’re on track to meet our next target of awarding 

$5 billion in total construction projects before September 30, 2010. 

We’re meeting our performance target of on-green by investing in 

high-performance, green building projects. We’re using recovery 

funds, and we have the opportunity to become a green proving 

ground, that is, to provide practical data on improving emerging 

green technologies and practices to determine what the return on 

investment of those technologies might be. 

Our investments are helping to stimulate the economy in every 

State, including the State of Hawaii. Using Recovery Act funds, 

GSA has invested in two of Hawaii’s landmark buildings, one here 

in Honolulu and one here in Hilo, as I said. 

Construction began in late April on the Prince Jonah Kuhio Kalanianaole Federal Building and Courthouse. We received $121 

million in Recovery Act funds to modernize and renovate the building. These funds are being used to install an energy efficient heating and ventilation system, to renovate the restrooms and install 

new water efficient fixtures there, upgrade fire alarms and sprinkler systems, and replace the majority of lighting in the building. 

These modifications are expected to reduce energy consumption by 

nearly 30 percent, and will qualify the building for a green silver 

rating. I had the opportunity to tour the building yesterday and 

construction is underway. We have a lot going on there, we’re moving people around inside of the building, in order to make way to 
15 

get the courthouse started, and that project is going to start very 

soon. 

It should be—the first phase is complete, and construction began 

in April 2010. The first phase will be done in 2014. At that point, 

we’ll be looking for additional funds to come and finish the Federal 

building courthouse complex. 

Construction work on the Hilo Federal building began last August after the project received over $7 million in Recovery Act 

funds. The work includes improvements to the plumbing and electrical systems, historic preservation measures, upgrades to the life 

safety systems and a seismic retrofit of the building. We expect 

that project to be completed in full in the summer 2011. 

To clarify, when GSA obligates money, we are making a contract 

award directly with our contractors. The contract award is a catalyst for money to start flowing. Contractors immediately begin to 

secure financing, hire personnel and initiate early steps to perform 

their project. As progress is made, contractors invoice and get paid 

for the work they perform. These project payments are made over 

the life of the contract and provide steady support for our economy 

over an extended period, not just a jolt that lasts for a few months. 

As of June 28, our contractors reported that our investments have 

funded 2,688 jobs across GSA’s program. 

GSA’s infrastructure investments vary in scope, type, and complexity. They range from the two landmark projects, here, in the 

50th State, to the new courthouse in Austin, Texas, to as large as 

the new Department of Homeland Security (DHS) headquarters in 

Washington, DC, at the St. Elizabeth’s Campus. That’s going to be 

the largest Federal project in the area since the construction of the 

Pentagon. 

Many of our projects include exciting approaches to energy conservation, including geothermal heat source pumps for both heating 

and cooling, and we’re shooting for net-zero energy uses in all of 

our buildings, starting with one of our land ports of entry on the 

southern border. 

Project labor agreements came from the Presidential Executive 

order regarding PLAs and we’ve had the opportunity to use PLAs 

in several of our projects. We’re promoting the use of PLAs in our 

construction solicitations for projects greater than $25 million. This 

is consistent with President Obama’s Executive Order 13502 on the 

use of project labor agreements for Federal construction projects. 

PLAs are a collective bargaining agreement on the terms of employment for all laborers on the project, whether they are union or 

non-union. The agreement is between the contractor, its subcontractors and the labor unions. 

Appeal A was successfully negotiated between the contractor and 

labor here in Hawaii at the Prince Kuhio Building. 

In addition to our Recovery Act funds, GSA expects to receive approximately $856 billion from other agencies. Today, we received 

over $450 million in Recovery Act reimbursable work, and of that 

we have obligated over $300 million in contracts on behalf of other 

Federal agencies. 

I’ve described our accomplishments and contributions to the Nation’s economic recovery through the Recovery Act of 2009. We look 
16 

forward to working with you and the members of this committee 

as we continue to deliver this important work. 

Thank you for the opportunity to appear here today, and I’d be 

happy to answer any questions you have when the time comes. 

Chairman INOUYE. I thank you very much, sir. 

[The statement follows:] 

PREPARED STATEMENT OF WILLIAM J. GUERIN

Good Morning Chairman Inouye, Vice Chairman Cochran, and members of the 

Committee. My name is William Guerin and I am the Recovery Executive for the 

National Recovery Program Management Office of GSA’s Public Buildings Service 

(PBS). Thank you for the opportunity to appear before you today to discuss GSA’s 

contribution to our nation’s economic recovery through green modernization and 

new construction of our Federal buildings. 

Last year, the American Recovery and Reinvestment Act (Recovery Act) gave GSA 

an unprecedented and exciting opportunity to contribute to our nation’s economic recovery and environmental sustainability. The investments we made and continue to 

make in our public buildings are helping to stimulate job growth and retention in 

the construction and real estate sectors, reduce energy consumption, improve the 

environmental performance of our inventory, reduce our backlog of repairs and alterations, and increase the value of our assets. In addition, our investments will 

help further developments in energy efficient technologies, renewable energy generation, and green building solutions. 

We are successfully meeting our established milestones to meet the intent and 

goals of the Recovery Act. I will first summarize, and then further elaborate on our 

accomplishments. Since enactment of the Recovery Act on February 17, 2009, we 

have accomplished the following: 

—Submitted our first spend plan, identifying projects funded by the Recovery Act, 

to Congress on March 31, 2009. We have since submitted four revisions. Our 

fourth spend plan is still within the mandated 15 day congressional review period and will fund 268 projects in all 50 states, the District of Columbia, and 

two U.S. territories. 

—Established and met our target dates for contract awards: 

—$1 billion in contract awards by August 1, 2009, 

—$2 billion in total contract awards by December 31, 2009, and 

—$4 billion in total contract awards by March 31, 2010. 

—Put GSA on track to meet our next targets: 

—$5 billion in total contract awards by September 30, 2010. 

As of June 28, 2010, we have obligated nearly $4.3 billion to more than 500 companies and outlayed over $471 million. 

—In addition to our Recovery Act Funds, GSA expects to receive approximately 

$856 million in Recovery Act funds from other agencies. To date, we have received $459 million in Recovery Act reimbursable work authorizations and, of 

that, have obligated over $301 million in contracts on behalf of other agencies. 

—Over the last 3 reporting periods, GSA obtained nearly 100 percent compliance 

on contract recipient employment reporting on all 500∂ separate contract 

awards. During the first quarter, only one recipient did not comply; in the second reporting cycle, GSA achieved 100 percent compliance. PBS received over 

99 percent reporting compliance during the most recent reporting quarter that 

closed in April. 

—Established PBS as a Green Proving Ground to provide practical data in order 

to measure the returns on investment in emerging green technologies and practices. 

GSA is proud of these accomplishments and our opportunity to contribute to our 

nation’s economic recovery and reinvestment in our building infrastructure. I will 

now elaborate further on what we have done as well as describe some of our exciting 

building projects. 

Organizational Response 

Given the urgency of the situation and the goals of the Recovery Act we moved 

forward quickly and diligently to select the best projects for accomplishing the goals 

of the Recovery Act based on two over-arching criteria: potential of the projects to 

put people back to work quickly and to transform Federal buildings into high-performance green buildings. To help manage and oversee our Recovery Act program, 

PBS created a new national approach to program management and we adopted a 

credo of ‘‘On Schedule, On Budget and On Green.’’ 
17 

As described earlier, we met our targets of ‘‘On Schedule and On Budget’’ by exceeding our aggressive goal of obligating $4 billion by March 31, 2010. This is particularly remarkable given that project awards were on average 8–10 percent below 

our projected cost estimates. Lower-than-expected contract awards made additional 

funds available, which we reallocated and invested in new high-performance features and projects. To further describe the magnitude of this achievement, in order 

to meet the March goal we accelerated schedules for 116 projects representing $561 

million in investments. 

We are working towards meeting our performance target of ‘‘On Green’’ with our 

Recovery Act funding targeted at high-performance green building projects. The 

funding provided by the Recovery Act has jump-started our effort to meet mandated 

energy and water conservation targets in the years to come. We appreciate Congress’ foresight to direct the majority of our funding toward converting GSA’s facilities into high performance green buildings. 

In order to meet these aggressive measures, we set interim target dates for 

project awards in each quarter and monitor project progress, identify schedule 

variances early, streamline and accelerate projects, and share best practices. PBS 

has quickly identified opportunities for reinvestment and updated its spend plan to 

enhance or accelerate funding of other projects. To date, we have revised our spend 

plan four times: revisions were submitted on November 23, 2009, January 19, 2010, 

March 5, 2010, and most recently, on June 24, 2010. Speedy revisions to the spend 

plan were essential to meet our interim goals and are essential in meeting the mandated timelines in the Recovery Act. 

Stimulating the Economy 

GSA’s infrastructure investments vary in scope, type, and complexity and cover 

our entire portfolio. Funds from the Recovery Act are being used to convert our inventory to high-performance green buildings, as well as renovate and construct Federal buildings, courthouses, and land ports of entry. These projects range from single building system modernizations to large complex new construction projects. As 

of June 28, 2010 our obligations totaling nearly $4.3 billion for the 262 projects on 

Spend Plan #3, are funding the following projects in all 50 states, 2 territories and 

in the District of Columbia: 

—New Federal Buildings and Courthouses: 11. 

—Land Ports of Entry: 7. 

—High Performance Green Buildings—Full & Partial Modernizations: 45. 

—High Performance Green Buildings—Limited Scope Projects: 199. 

Notably, GSA’s ‘‘obligations’’ are awards flowing directly to our contractors, i.e., 

directly into the construction, real estate and architecture/engineering sectors. 

While contract award is the catalyst for money flowing through the economy, funds 

associated with construction or design projects are not immediately outlayed following contract award. Rather, payments to contractors for progress made over the 

life of the contract provide steady support for our economy over an extended period—not a jolt that lasts only a few months. 

Less visible but important contributions to economic recovery follow shortly after 

we award a contract: contractors immediately begin to secure financing, hire personnel, and initiate early steps to perform the project. 

Reports from our Recovery Act funding recipients indicate that as of June 28, 

2010 2,688 prime contractor jobs were funded as a direct result of PBS Recovery 

Act funding during the reporting quarter ending June 30, 2010. 

Diversity of Investments 

As noted, the projects we have funded vary in amount of investment, scope of 

project, type of project, and geographic region. For example, in Austin, Texas, we 

are building a new courthouse that incorporates many innovative green features 

such as high-efficiency heating, ventilation and air conditioning (HVAC) systems 

and extensive use of natural light. PBS is building this courthouse to achieve Leadership in Energy and Environmental Design (LEED) Silver certification through the 

U.S. Green Building Council (USGBC). Although construction began in September, 

the project team continues to review the design to determine if additional high-performance green building features can be added to the project, including recycled interior finish materials and a highly insulated cool roof. Anticipated completion date 

is December 2012. 

Our progress toward the development of the St. Elizabeths campus, in Washington, DC is on track. The St. Elizabeths project is the Washington metropolitan 

area’s largest Federal project since construction of the Pentagon, and will help revitalize and spur additional development in Southeast Washington’s Anacostia community. The completed complex will feature green roofs, landscaped courtyards to 
18 

capture and reuse surface water runoff, and innovative HVAC systems. We registered all buildings at St. Elizabeths with USGBC, and we expect the St. Elizabeths campus to earn a LEED Silver certification and are striving for Gold certification. 

The B.H. Whipple Federal Building project in Fort Snelling, Minnesota will renovate the main building, the motor pool building and add a new Sally Port. The facility will use a geothermal/ground source heat pump system for both heating and 

cooling that will greatly reduce the facility’s energy usage. A geothermal well field 

will require removal of most of the site pavement and will therefore promote storm 

water management for a ‘‘95 percent rain event.’’ Other features include installing 

a high efficiency sprinkler system and plantings, and high efficiency LED site lighting. The Building Automation System will be upgraded to include demand controlled 

ventilation, an upgrade of the building lighting control system to include dimmable 

ballasts, occupancy sensor controls and daylight harvesting near exterior windows 

and solar thermal technology providing 30 percent of the building’s domestic hot 

water. Once completed, the building will achieve at least a 30 percent efficiency improvement over a baseline HVAC system compliant with ASHRAE 2007 90.1. 

Green Technologies and Practices 

We are leveraging our Recovery Act investments to turn our large, varied and stable inventory of buildings into a proving ground for green building technologies, materials, and operating regimes. By adopting new ideas and products, then evaluating 

and publicizing our results, GSA is working to become one of the commercial real 

estate industry’s ‘‘go to’’ sources for data on the environmental and economic payback of new systems and procedures. Our investments in innovative technologies 

and alternative energy solutions can help lead the transformation to new green jobs 

and new green industries. The table below identifies the number of green technologies we are including in our projects. 

System 

Projects With Expected Completion by 12/31/10 

System Tune-ups/Recommissioning ..................................................................................................................... 58 

Lighting ................................................................................................................................................................ 40 

Water .................................................................................................................................................................... 7 

PV Roof ................................................................................................................................................................. 11 

Roof ...................................................................................................................................................................... 26 

Fac ̧ade/Windows ................................................................................................................................................... 11 

Advanced Meters .................................................................................................................................................. 150 

Solar Hot Water .................................................................................................................................................... 2 

Wind ..................................................................................................................................................................... 2 

Restroom renovations at the Lewis F. Powell Federal Courthouse in Richmond, 

Virginia were successfully completed on May 3, 2010. This project focused on energy 

and water conservation, using more modern toilets, urinals and faucets. These new 

products use less water than the standard commercial products used in today’s 

buildings. Also, modern lighting products were installed that use less energy per 

bulb and provide high quality illumination. In addition, motion sensor light switches 

were installed to minimize unnecessary energy usage. The contract was awarded on 

August 21, 2009 utilizing Recovery Act funds and employed approximately 10–15 

employees from the prime contractor’s staff and approximately 8 difference local 

subcontractors. The contractor worked quickly and provided a successful project on 

time and well within the budget allowed for this work. 

At the Columbus, New Mexico Land Port of Entry, we are providing additional 

funds to design a net zero energy building. A net zero energy building is a highly 

energy-efficient building that uses renewable energy-generation technologies to 

produce as much energy as it consumes from traditional utility grids over the course 

of a year. Not only will this reduce greenhouse gas emissions, but it will also support the mission need of agencies housed there to maintain critical systems in the 

event of a complete loss of utilities. Building systems and technologies may include: 

integrated building walls containing super-insulation and high-performance glass; 

high-efficiency HVAC systems; energy-saving lighting systems; ground-source heat 

pumps; passive solar heating; natural ventilation; use of day lighting; solar heated 

air; and solar thermal water heaters. 

At the Dayton Federal Building, we are installing an automated HVAC system 

as well as a lighting control system that includes occupancy sensors and dimmable 

ballasts. In addition, the building will harvest daylight near exterior windows to improve the quality of light and reduce the need for artificial lighting. 
19 

We are also pursuing projects that will upgrade the performance of specific systems within many of our buildings. These ‘‘Limited Scope’’ projects focus on improving energy performance and are evaluated in the context of the existing physical 

condition of the building. We evaluated these buildings and identified opportunities 

to ‘‘tune-up’’ the systems, improve building mechanical system controls, recommission building systems and retrofit or replace lighting or HVAC systems. To better 

achieve the goals of the Energy Independence and Security Act (EISA) of 2007, we 

particularly focused on those projects related to renewable energy production and 

water conservation. 

In addition to the Limited Scope projects, PBS has obligated over $113 million for 

High-Performance Green Building Small Projects that represent other opportunities 

for funding measures to convert our buildings to high-performance green buildings. 

These projects tend to be smaller in scope and size. 

Recipient Reporting 

The Recovery Act requires contractors and other recipients of Recovery Act funds 

to submit quarterly reports that provide the public information on the prime and 

sub-awards, funding, and project status. The third reporting period closed on April 

16. 

For this reporting period, we continued the multimedia outreach approach we developed last reporting quarter to ensure recipients were aware of the quarterly reporting requirement. We telephoned our prime recipients directing them to the 

FederalReporting.gov website used to register and report; we e-mailed Recipient Reporting Guidance to all recipients; we provided pre-populated report templates; and 

we posted guidance to the gsa.gov/recovery website. We also continued to leverage 

our call center to assist recipients with reporting questions. Our recipients have provided positive feedback about GSA’s call center, and have expressed gratitude to our 

staff for assisting with the reporting process. I am proud to report that as of April 

16, 2010, more than 99 percent of GSA’s recipients have reported in 539 reports. 

As of June 28, 2010 GSA has funded 2,838 jobs (3,057 including RWA work). PBS 

has funded 2,688 jobs from PBS funds and an additional 69 jobs funded from RWAs. 

Support to Other Agencies 

In addition to GSA’s Recovery Act program, we are supporting the real estate 

needs of other agencies that have received Recovery Act funding, such as SSA, DHS, 

DoS. As of June 28, we have entered into reimbursable work agreements with customer agencies totaling $459 million across 35 projects. In total, we anticipate receiving approximately $856 million for Recovery Act projects from our customers. 

Conclusion 

Congress entrusted GSA with a significant increase in funding to support the construction and modernization of high performance green buildings while quickly putting people back to work during these challenging economic times. We have risen 

to the challenge, and we are implementing our program rapidly and successfully. 

Today, I have described GSA’s accomplishments and contributions to our nation’s 

economic recovery through our investments in green technologies and reinvestments 

in our public buildings funded by the American Recovery and Reinvestment Act of 

2009. We look forward to working with you and members of this Committee as we 

continue to deliver this important work. 

Chairman INOUYE. And now may I call upon NOAA’s Representative Broglie. Mr. Broglie. 

STATEMENT OF WILLIAM F. BROGLIE, CHIEF ADMINISTRATIVE OFFICER, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION, 

DEPARTMENT OF COMMERCE 

Mr. BROGLIE. Chairman Inouye, Senator Akaka, I appreciate the 

opportunity today to discuss the impact of the American Recovery 

and Reinvestment Act of 2009 in the course of the NOAA Pacific 

Regional Center. 

I know you are both well aware of the good work that NOAA 

does, but for other present here today, I wanted to talk a little bit 

about NOAA in Hawaii, and the Pacific Regional Center, to maybe 

frame for folks why the ARRA funding is so important to NOAA 

for this project. 
20 

NOAA has a significant presence in Hawaii, with over 600 employees and associates working here. The programs NOAA manages in Hawaii and the Pacific Region are large and diverse, spanning a geographic area covering over 30 million square miles, five 

time zones and encompassing nearly one-half of U.S. Exclusive 

Economic Zone. 

NOAA’s responsibilities, include tsunami, climate and weather 

prediction, including tsunami and severe weather warnings fisheries management and stock assessments, marine mammal and endangered species protection, coral reef conservation, including marine debris removal, National Marine Sanctuary management and 

operation, and supporting the development and sustainment of hazard resilient communities. 

NOAA operates three ocean-going research and survey vessels 

that are permanently homeported in Hawaii, and operate throughout the Pacific. In 2010, there was total investment in programs 

and operations in Hawaii is more than $126 million, much of which 

is brought directly into the local economy through Federal jobs, 

contracts, and cooperative research projects conducted in Hawaii. 

As NOAA’s programs and mission responsibilities in the Pacific 

grew over time, we established a presence in nearly 18 different 

dispersed locations across Oahu. For almost a decade, NOAA has 

had a vision for a Pacific Regional Center, a centralized location 

that would allow NOAA to better integrate its research, products 

and services. 

Approximately 6 years ago, NOAA entered into a partnership 

with the U.S. Navy in Hawaii to begin developing the new Pacific 

Regional Center on historic Ford Island, at Pearl Harbor. Undergoing its own revitalization plan, Ford Island provided the ideal location for NOAA’s new Pacific Region headquarters: deep-water 

berthing for vessels, seawater for scientific research, and space that 

could support over 700 people in the future. 

NOAA’s development of the new Regional Center proceeded in 

three phases. First, a new Ship Operations Facility supporting our 

research and survey vessels opened the fall 2007. A new marine 

science and storage facility is currently under construction and is 

scheduled for completion in 2011. The third, and largest, phase, the 

development of the Center’s main facility, received critical capital 

investment funds under ARRA. 

The Center’s main facility will encompass over 300,000 square 

feet of lab and office space, renovating two World War II-era hangars and developing a new third building that will join those together. 

Later this summer on NOAA’s behalf, the Navy will award the 

construction contract for the Center’s main facility, with projected 

completion and occupancy in early 2013. The ARRA funding allowed NOAA to move forward with the main facility construction, 

and the overall consolidation at Ford Island. 

The impact of ARRA funding in the context of the Center can be 

measured at multiple levels. In the short term, from a jobs perspective, we expect the award of the construction contract to bring over 

$140 million in construction jobs to the labor market in Hawaii. 

Over the long term, having a world-class science and research facility located in Hawaii is expected to further promote international, 
21 

scientific, and local educational partnerships. This world-class facility is expected to aide in recruiting the next generation of scientists 

and researchers to work on the critical science issues facing the 

Nation and the Pacific region in the future. 

NOAA also expects the project to promote further partnership opportunities on common operational and research issues with the 

Navy, given our joint presence at Pearl Harbor. The new facility 

will promote NOAA’s continued commitment to sustainable design, 

achieving at least a LEED Silver status, and will allow NOAA to 

partner with the Navy in its deployment of solar energy and photovoltaic cell systems on Navy buildings in the near future. 

In summary, NOAA’s Pacific Regional Center main facility is expected to bring benefits to the local economy here in Hawaii, both 

in the short term, through the creation or sustainment of construction-related jobs, and in the long term, by creating a modern, stateof-the-art lab and office facility that promotes science and educational partnerships and attracts the next generation of scientists 

and researchers. The funding also allows NOAA to realize the programmatic vision of establishing a NOAA facility that better serves 

Hawaii and the broader Pacific Region. 

We appreciate your historic and continued support of NOAA and 

its programs, and particularly this project. Thank you for inviting 

me to provide this testimony. 

[The statement follows:] 

PREPARED STATEMENT OF WILLIAM F. BROGLIE

My name is William Broglie, and I am the Chief Administrative Officer for the 

National Oceanic and Atmospheric Administration (NOAA). I appreciate the opportunity today to offer a few perspectives on the American Reinvestment and Recovery 

Act of 2009 in the context of the NOAA Pacific Regional Center. 

NOAA has a significant presence not only in Hawaii, with approximately 600 employees and associates working here, but also in the larger Pacific Region, with offices in Guam, the Commonwealth of the Northern Mariana Islands, the Republic 

of Palau, the Federated States of Micronesia, American Samoa, and the Republic 

of the Marshall Islands. The programs NOAA manages in the Pacific are large and 

diverse, spanning a geographic area covering over 30 million square miles, spanning 

5 time zones and encompassing nearly one-half of U.S. Exclusive Economic Zone. 

NOAA’s responsibilities, including international, fall broadly into the following 

areas: 

—Tsunami, climate and weather prediction (the latter encompassing both the 

Northern and Southern Hemispheres, and ranging from tropical to sub-polar): 

—Tsunami information and warnings, 

—Severe weather warnings (hurricanes, typhoons, flash floods, high surf, high 

winds, and even snow), 

—El Nin ̃ o/La Nin ̃ a predictions and climate change impacts; 

—Fisheries management and stock assessments; including tuna, swordfish, snappers, lobsters; 

—Marine mammal and endangered species protection (monk seals, Pacific sea turtles, whales), research, and recovery; 

—Coral reef conservation, including marine debris removal; 

—National Marine Sanctuary management and operation including the Hawaii 

Humpback Whale Sanctuary and the Papaha ̄naumokua ̄kea Marine National 

Monument; and 

—Hazard resilient communities. 

NOAA operates three ocean-going research and survey vessels that are permanently homeported in Hawaii, but operate throughout the Pacific. Other NOAA vessels have missions that take them into the Pacific. NOAA’s total fiscal year 2010 

investment in programs and operations in Hawaii is more than $126 million, much 

of which is brought directly into the local economy through Federal jobs, contracts 

for services, and cooperative research projects conducted in Hawaii. 
22 

As NOAA’s program and mission responsibilities in the Pacific grew, it established a presence in nearly 18 different sites across Oahu. For almost a decade, 

NOAA has had a vision for a Pacific Regional Center, a centralized location that 

would allow NOAA to better integrate its research, products and services. 

Approximately 6 years ago, NOAA entered into a very productive partnership 

with the U.S. Navy in Hawaii to begin developing the new Pacific Regional Center 

on historic Ford Island, at Pearl Harbor. Undergoing its own revitalization plan, 

Ford Island provided the ideal location for NOAA’s new Pacific Region headquarters: 

deep-water berthing for vessels, seawater for scientific research, and space that 

could support over 700 people in the future. NOAA’s development of the Pacific Regional Center (PRC) proceeded in three phases. First, a new Ship Operations Facility supporting our research and survey vessels opened the fall of 2007. A new marine science and storage facility is currently under construction and is scheduled to 

be completed in 2011. The third phase—development of the PRC Main Facility—received critical capital investment from American Recovery and Reinvestment Act 

(ARRA) funding. 

The PRC main facility will encompass over 300,000 square feet of lab and office 

space in two renovated World War II era hangars and a third, new building that 

together will realize NOAA’s goal of an integrated facility. 

Later this summer on NOAA’s behalf, the Navy will award the construction award 

for the Pacific Regional Center’s Main Facility, with projected completion and occupancy in early 2013. The ARRA funding allowed NOAA to move forward with the 

Main Facility construction, and has therefore significantly reduced the time to completion of the project and the overall consolidation at Ford Island. The impact of 

ARRA funding in the context of the Pacific Regional Center can be measured at 

multiple levels. In the short term, from a jobs perspective, we expect the award of 

the construction contract to bring over $140 million in construction jobs to the labor 

market in Hawaii. Over the long-term, having a world-class science and research 

facility located in Hawaii is expected to further promote international scientific and 

local educational partnerships. From a historical perspective, the ARRA funds allow 

us to restore and adaptively re-use World War II era buildings in a manner that 

preserves many of the structural components of the buildings, consistent with interests of Historic Preservation Partners with whom we have collaborated on the 

project. 

This world class facility is expected to aide in recruiting the next generation of 

scientists and researchers to work on the critical science issues facing the Nation 

and the Pacific region in the future. NOAA also expects the project to promote further partnership opportunities on common operational and research issues with the 

Navy, given our joint presence at Pearl Harbor. The new facility will promote 

NOAA’s continued commitment to sustainable design, achieving at least a LEED 

Silver status, and will allow NOAA to partner with the Navy in its deployment of 

solar energy/photovoltaic cell systems on Navy buildings in the near future. 

We were very fortunate that the Pacific Regional Center Main Facility was well 

into the design process when the ARRA funding became available, which ensured 

that we could award the necessary contracts by September 30, 2010—the expiration 

date for the ARRA funding. We are also fortunate that funding required for other 

non-construction costs, such as funding to begin work on the information technology 

required for the building, and normal project-contingency funds had been separately 

appropriated; since such funding will be obligated after the expiration of the ARRA 

funds. The Administration’s fiscal year 2011 budget request includes funding to support remaining project requirements, such as outfitting the building with information technology and furniture, and funding for the inevitable contingencies that do 

not occur until after the construction is already underway. We appreciate your continued support of this project, and look forward to its completion in 2013. 

NOAA’s Pacific Regional Center Main Facility is expected to bring benefits to the 

local economy here in Hawaii both in the short-term, through the creation or 

sustainment of construction-related jobs, and in the long-term, by creating a modern, state-of-the-art laboratory and office facility that promotes science and educational partnerships and attracts the next generation of scientists and researchers. 

The funding also allows NOAA to realize the programmatic vision of establishing 

a NOAA facility that consolidates most of the programs that serve Hawaii and the 

broader Pacific Region. One program that would not be consolidated is the Weather 

Forecast Office that is co-located on the University of Hawaii, Manoa campus. 

Thanks you for inviting me to provide this testimony, I am happy to answer any 

questions you might have. 

Chairman INOUYE. Thank you very much. 
23 

I’d like to ask a general question to all of you, all of the witnesses. How many jobs have been retained or created as a result 

of ARRA funding? 

Sir? 

REPORT BY QUARTERS

General WILLIAMS. Sir, right now we take all of the information, 

I think, as does everyone from the recovery.gov Web site. And that 

is where the contractors report the number of jobs that have been 

created. Right now, on the Web site, it captures recovery-funded 

jobs, but it may not capture exactly how many have been retained, 

and how many jobs have actually been created. So, what we capture right now is recovery-funded jobs, which is a collection of both. 

Chairman INOUYE. How much is that? How many? 

General WILLIAMS. Right now, the number is 405, however, that 

just goes to the end of—the end of March, the 31st of March. That 

was the end of the second quarter. And the way it works, right 

now, based on my knowledge, is that they report by quarter. We 

have just completed the end of the third quarter, which ended the 

last portion of June, and then the contractors take the first 10 days 

of the next quarter—we’re in, as we speak, they’re updating that 

Web site. Then, for us, in the military departments, we take the 

next 20 days or so to validate the input of the contractors, based 

on our awarded of that contract. 

So, somewhere around 30 to 45 days after the end of the quarter, 

we actually have updated information. So, right now, we’re reporting 405, but I suspect that the number is much higher. We should 

know in the month of August. 

Chairman INOUYE. I thank you, General. 

Brennon? 

Mr. MORIOKA. The report that we have for transportation-related 

jobs, either sustained or created, the last report was 2,317 jobs 

here in Hawaii, and that’s between the highway funding, airport 

funding, and FTA funding. 

Chairman INOUYE. GSA? 

Mr. GUERIN. Nationally, Senator, we’ve created over 2,600 jobs, 

based on the formula that the General described. 

We also use a formula that we’ve talked about with Congress before of $92,000 per job. And if you use that, in the $130 million in 

the State of Hawaii, we could create upward of 1,400 jobs, here in 

the islands. That’s assuming that all of the projects—all the jobs 

created for both the Federal buildings in Hilo and Honolulu. 

Mr. BROGLIE. In NOAA’s assessment, once the construction contract is awarded in September, is that we’ll be looking at creating 

or sustaining approximately 1,400 construction-related jobs over 

the 21⁄2 years period of the construction project. We haven’t really 

tried to estimate beyond that, other jobs—service-related job that 

will be associated with supporting the facility once it’s constructed 

and we occupy it. 

Chairman INOUYE. I ask that question because as we all are 

aware, sadly, the National unemployment numbers of 9.7 percent 

and in Hawaii it’s 6.7 percent. And thanks to you, we’ve kept it 

going. And I hope it can continue. 
24 

Now, if I may continue, General, your area of responsibility, 

PACOM’s area, is the largest in the world. I realize the funding 

here is just a drop in a bucketful of DOD funding, but does it help 

you in maintaining your mission? 

General WILLIAMS. Sir, I don’t think there’s any question that 

the funding that we will receive, in fact, assists us with maintaining military readiness. Much of it, as you know, is related to our 

various facilities, and those facilities, of course, house our command and control structures as well as some of the non-DOD 

projects, for example, that will assist NOAA, that will also assist 

Trippler Army Medical Hospital. So, I don’t think there’s any question that it contributes to military readiness. And every bit of funding that we receive, we think, contributes to that cause. So, thank 

you very much. 

Chairman INOUYE. Thank you. 

Mr. Morioka, you spoke about concerns over oversight. Can you 

describe that further? 

Mr. MORIOKA. There’s—part of the—the direction for Federal 

highways has been there’s more oversight involvement by Federal 

highways in receiving more reports from the DOT’s, looking 

through records and documentation on a more frequent basis. And 

so, that—just that increased level of oversight has required us to 

staff up on making sure that we have those records and documents 

available to Federal highways. 

I think—part of our concern is more so just the relationship direction, from a national perspective. Here, in Hawaii, we initiated 

with our Federal highway partners, a stewardship agreement approximately 6 years ago. And I think when we at DOT in Hawaii 

started to ramp up and become more aggressive in our project delivery at about the same time, I don’t think we would have been 

successful in our efforts, if it wasn’t for the kind of partnership 

that we had with Federal highways. And we continue to have that 

very good relationship and partnering with our local office. 

But we do know that there is some concern, especially with much 

of the banking industry and some of the oversight issues, that the 

desire for more oversight on a broader basis is a potential direction 

that might—that many of the Federal agencies might be going to. 

And we hear it more from our other State DOT’s when we attend 

and talk with our other—my counterparts in other State DOT’s, 

that the relationship between Federal highways and their departments are not as productive as they used to be. 

That’s surely not the case, here. And I think that’s in large part 

due to Mr. Wong and the quality of much of his staff in trying to 

perpetuate the stewardship and partnering agreements that we 

have. But, it’s just our concern that we don’t want to go back to 

the old days, where it was more of a policing effort, rather than a 

partnering effort. 

But, currently, that’s not the case. We’re just concerned that we 

don’t go backwards, because I think we’ve come a long way in the 

last few years. 

OVERSIGHT

Chairman INOUYE. Do you believe that some of the oversight is 

unnecessary? 
25 

Mr. MORIOKA. No, I think there just needs to be an ability to 

strike a balance between the two. 

Chairman INOUYE. Okay. Is Mr. Wong here? Have you got any 

comment to make? 

Mr. WONG. I think Brennon’s observations are correct. Our differing with a higher level of accountability, transparency, we knew 

was going to be a challenge going into it. The question is whether 

it’s going to be sustained by this, after ARRA expires and we go 

back to the legislation that we work under, which up for reauthorization, so that’s still a big unknown. 

But, you know, partnership, I think, has been strong. We met the 

challenge with the adjustments. I think what we’re seeing in terms 

of the oversight piece of it, is a little bit more checking on the expenditure and the things and that does take a little bit of trying. 

We are not trying to examine that, I guess, with an ‘‘I gotcha’’ 

mentality, but more as, you know, if there are weaknesses in that 

process that we use this opportunity to address those weaknesses 

on a more systemic basis. 

So, for the overall good and probably the future of a program like 

this, I think this experience has been positive. But, in the sense 

that, I think with the resource restrictions and that type of thing, 

is has been a challenge. 

Chairman INOUYE. So, are you satisfied with the relationship? 

Mr. WONG. I think it’s worked very well. I think we’ve had a big 

challenge to step up to and with some of the limitations that occurred during that process, I think we’ve worked very well together. 

Chairman INOUYE. Congratulations. 

Mr. WONG. Thank you, sir. 

Chairman INOUYE. This way we save a few bucks down there. 

Mr. WONG. We try to. 

Chairman INOUYE. Do you think that the monies are being spent 

in a timely fashion? 

Mr. MORIOKA. Yes, I do. I think just the way that we select the 

projects and the types of projects that we selected—our construction projects are going to be stretched over 2 to 3 years. I know 

there is a desire to see the expenditure rates go up a lot faster, to 

actually expend all of the—the ARRA funds itself. But when you 

look at the outlay of cash flow for a construction project, it’s going 

to be done over a 3-year period. And, for us, that was a very conscious decision. We know that the expenditures were going to be 

slower, but it was going to be done on—over a longer period of 

time, making sure that the people are employed for a longer period 

of time. The types of projects that we chose were going to be larger 

infrastructure investments, and so I think we’re expending the 

money in an appropriate timeframe, based on the types of projects 

that we have. And I think the projects that we have are the right 

projects for Hawaii. 

Chairman INOUYE. I must say that I was impressed at your statistics of 14 percent for resurfacing, and the national average is 40? 

Mr. MORIOKA. Forty-nine. 

Chairman INOUYE. I think your decision was correct. 

Mr. MORIOKA. Thank you. 

Chairman INOUYE. I thank you very much. 
26 

PROJECT STATUS

Mr. Guerin, have the Hilo and Honolulu projects progressed as 

planned? 

Mr. GUERIN. They are. It took some time to procure both of the 

projects but they are now in construction and they are now moving 

forward, so I think we’re right on track. We’ve been at this more 

than 1 year, now, and to add both of those projects in construction, 

as you know, Hilo has been an unfortunate victim of not enough 

funding for a period of time, and then we managed—because of the 

downturn in the economy—to get very good bids on the project. We 

were surprised about that, but happy to finally award that project, 

because it’s been a need for a long time and has been seeking funds 

for several years, now. 

The work, here, in Honolulu is more timely, but that project was 

designed quickly. It’s a CMS constructor project, where the CM is 

helping us finish the design, as well as go into construction, and 

that’s moving very well, as well. So, we’re underway and we have 

a good project schedule. 

The phasing for Honolulu is fairly elaborate because we can’t 

move the courts out of the courthouse. Finding space for courtrooms and chambers that’s adequate for the judge’s needs is a 

tough trick anywhere, and in Honolulu it’s a tough trick, as well. 

So, we have a phased construction project there, in the courthouse, 

we ran through the plans yesterday with the project team, and it’s 

very well thought out, and moving forward. 

Chairman INOUYE. I’m especially pleased with the project labor 

agreement. I think it will provide a steady workforce and on-time 

completion. 

Mr. GUERIN. We agree, Senator. The GSA led the charge with 

PLAs with the Executive order. Really, we haven’t used them in 

the past. Came to find out, that several locations, the contractor 

and labor have been using PLAs that we were just not aware of. 

So there was a little bit of trepidation coming into it. But, we’ve 

been very successful with PLAs, so far, across the country and the 

project here is a good example of that. 

Chairman INOUYE. Thank you very much. 

And with NOAA, you have this child development facility on 

Ford Island? I think that’s one of your projects with the Navy? 

Mr. BROGLIE. We’re working closely with the Navy to reach 

agreement on how to leverage the investments that the Navy is already making at a Ford Island Child Development Center, to make 

sure that it meets not only the Navy’s needs, but also can best 

serve NOAA’s family needs moving forward, as well. 

Chairman INOUYE. I’m glad this is happening, because it’s money 

being put to good use. 

Mr. BROGLIE. We’ve benefited, Senator, with a very good partnership relationship at multiple levels with the Navy over the past 

several years and this is one example of it. 

Chairman INOUYE. Well, as you know, I have a NOAA Executive 

on my staff. And I’m constantly being propagandized. 

Mr. BROGLIE. We appreciate her on multiple levels. 

Mr. GUERIN. Do you need a GSA member, also? 

Chairman INOUYE. We’ll consider that. 
27 

I’d like to call upon Senator Akaka. 

Senator AKAKA. Thank you very much, Mr. Chairman. 

Brennon Morioka, you say that you’re applying right now about 

2,300 or so on the jobs that you have, this stimulus money. Is that 

a cap, or is there a possibility of increasing that? 

Mr. MORIOKA. No, we anticipate to actually have a much higher 

number by the time we’re done. Many of our projects, some of the 

larger ones, are just starting out. We still have a couple more to 

bid that are fairly sizable, especially the Mid-Level Road in Kona. 

It has only started a few months ago, so that project will ramp up 

significantly, and that’s a $35 million project for the county of Hawaii. And so those numbers will continue to add. So, I think this 

number is going to increase significantly. 

KONA PROJECT

Senator AKAKA. Particularly, I’m interested in that, they call it 

Leiopua 2010, I think, or 2020. 

Mr. MORIOKA. Leiopua 20—yeah. 

Senator AKAKA. 2020, yes. 

Mr. MORIOKA. Correct. 

Senator AKAKA. And it’s a project in Kona on the sand, as you 

stand by Honakohau Road, there, above that is where this road is, 

to be constructed. 

Mr. MORIOKA. Correct. It’s a very good development. It’s a regional vision for the people of Kona, something driven by the need 

for affordable housing, workforce housing in Kona. And so two of 

the major developments are affordable housing. It’s Department of 

Hawaiian Homelands, for their development, and HHFDC’s affordable housing program, that they have partnered with four cities to 

develop. And it’s not just only affordable housing but it’s development of a community with commercial facilities, recreational facilities, and so it very much is a community vision, rather than just 

building houses. 

And the Mid-Level Road that the county is building is just a part 

of building that community. But it’s a significant part. 

Senator AKAKA. Yes, that village you’re talking about, is called 

Ka Makana, affordable housing. 

Mr. MORIOKA. Yes. 

Senator AKAKA. And that, of course, is part of the community 

that we expect to rise from that project. 

Can you tell me, further, about the status of that project? 

Mr. MORIOKA. Well, I know DHHL is moving on two of their villages, they’re in active construction. I believe Four Cities is still 

working out some of their permitting issues, and—but they will be 

entering into construction of their housing and commercial development, but the county also has quite a bit of construction in their 

facilities and their centers along Kealakehe Parkway that the MidLevel Road ties into. So, this road really is, is a major vein for the 

development of this because it ties in and provides the network to 

connect all of these different components of the community. 

So, the development of this area of Leiopua is definitely moving 

along very rapidly. 
28 

Senator AKAKA. I’m happy that culture is brought in this, as 

well. I understand the name of the highway is going to be Ane 

Keohokalole Highway. 

Mr. MORIOKA. Yes. 

Senator AKAKA. And that name is Queen Liliuokalani’s mother’s 

name. So, with that, it makes it more precious for the Kona area. 

Mr. MORIOKA. Absolutely. And then Mayor Kenoi actually invited 

the family to the groundbreaking. So, it was a very touching ceremony. 

Senator AKAKA. Thank you. 

General Williams, I’m very pleased to know that already you’ve 

had 106 DOD construction projects in place. And this has been 

awarded in Hawaii, and you’ve created in those, about 400 jobs. I 

want to ask you is that—are you looking toward more jobs than 

400? 

General WILLIAMS. Senator, as I explained earlier, those figures 

really just reflect to the end of the second quarter. But we—I hate 

to speculate, but we certainly believe that when the end of third 

quarter data comes in that we’ll see the number of jobs significantly increased. 

Senator AKAKA. And I also understand that your focus has been 

on what you called sustainment, restoration and modernization 

types of projects. And as you know, today, in Congress, we’re of 

course very aware of the deficit and we’ve been discussing—because I’m a senior member of the Armed Services—been discussing 

the funding between what we call the warfighters, and ensuring 

that the DOD has the necessary funding for this SRM. But, we continue to try to provide enough for the readiness of our troops. What 

are some of the other projects that we ought to keep in mind for 

Hawaii if funds become available that will help enhance PACOM’s 

readiness programs? 

CHILD DEVELOPMENT CENTER ON MARINE CORPS BASE

General WILLIAMS. Well, I would certainly go back to each of the 

service components and ask that specific question. But, first of all, 

thank you for your support of some of the less-than-high-profile 

projects. I mean, one of the ones that I testified about today that’s 

very, very near and dear to our hearts, for example, is the $9.6 million in funding that was awarded for a child development center on 

the Marine Corps base. It’s that kind of funding that I believe 

you’re talking about. In addition, NOAA just testified that, you 

know, their coordination with the Navy, also resulting in use of another child development center. 

Well, for the military services, in particular, as you well know, 

while that may not be a high-profile project, it certainly helps to 

reduce the strain on many of our military families, especially those 

with extremely high operational tempo that are related to deployments. So, these kind of facilities, these childcare facilities are extremely important, and those are the kind of projects that we need 

to continue to support, and we appreciate your support on that. 

Senator AKAKA. Well, we’re grateful that you are focusing on 

families of our military personnel. That is so important in readiness. 
29 

I just want to mention another project that, for years, we’ve been 

trying to work on, and that’s trying to place a new cable in Hickam 

to provide the energy and power through Hickam, and hopefully 

there will be funds to do that. I don’t know whether that’s on the 

list of your projects. 

General WILLIAMS. Sir, I’ll have to check that particular fact and 

get back to you. We’ll specifically look for your request on that 

project. 

[The information follows:] 

The repair of the electrical distribution system is being executed in seven phases. Phase seven—estimated at $8.5 million O&M—of the seven phase Hickam AFB Repair Electrical Distribution System was not on the ARRA list because at the time 

of submission the project did not meet the initial 2009 ARRA guidance of being 

awarded within 90–120 days of funds receipt. The seventh phase, which places the 

final leg of the existing overhead Hawaii Air National Guard circuit underground, 

corrects safety deficiencies, and replaces live front transformers, is currently under 

design. HQ PACAF did submit the project as its number 1 priority for the fiscal 

year 2011 PACAF congressional Milcon insert and O&M Earmark Candidates. 

Phases 1 thru 3 are 100 percent complete and were funded with Milcon. Phases 4 

thru 6 are O&M funded projects and are at various stages of construction, and on 

target to be completed by spring 2011. Phase 7 is currently in design and should 

be completed by the time earmark funds are provided. 

Senator AKAKA. Mr. Broglie, the Kohala Center received a Recovery Act award to improve the condition of the Peliconi A watershed 

in South Kohala on the Big Island. This project is expected to reduce sediment, runoff into the bay that damages coral. Given such 

challenges as runoff, climate change and increased ocean pH levels, 

can you tell us what more must be done to protect corals and clean 

ecosystems? 

Mr. BROGLIE. Senator, I’ll probably need to get back to you with 

a fuller answer on that, consulting with the programmatic areas, 

I know they handle coral reef and ecosystem sustainment. I don’t 

have an immediate answer for you today. 

REPORTING PROCESS

Senator AKAKA. Mr. Guerin, you indicated in your testimony, and 

in our discussion earlier, the job creation totals from GSA and Public Building Service. What data quality review procedures or steps 

did you follow to ensure the reliability of filling those jobs reported? 

Mr. GUERIN. I think that gets to some of the comments that the 

General made, and also the discussion with Mr. Morioka about the 

recipient reporting process and the activity associated with that. 

The President has instituted a very robust reporting process that 

requires each recipient receives funds from the Recovery Act to report to the Federal Government on a quarterly basis. And those results are just being compiled now for the third quarter. 

But it’s a very iterative process whereby GSA, particularly, has 

created templates, worksheets for recipients so that we reach out 

to them to give them information, so, that they can provide back 

to us. Their job is, specifically, to tell us how many jobs, how many 

person-hours of work was accomplished during the reporting period. 

But GSA has been very actively engaged in trying to make that 

easier for people, because it is a burden. It is a—it’s a very significant process that is focused on the recipients of the funds. So, we’ve 

tried to do everything we can—we have a call center whereby we 
30 

reach out to people to remind them that, you know, it’s time, again, 

to report, to make sure that the forms are filled out properly, to 

make sure that it’s as easy as possible for them to report information to us, and we believe the information is quite accurate. 

The first go-around was, there was some, you know, well-publicized congressional districts that didn’t exist, those kinds of 

things, but the administration has been very aggressive about trying to correct that information and make sure that the information 

reported back to us is as accurate as possible, and I believe they’ve 

made great strides in that. 

In my own program, I run a program management office specifically focused on the Recovery Act, and I have a whole subset of 

people in my organization that are specifically devoted to recipient 

reporting and ensuring that that reporting process is done correctly. So, I believe the information is as accurate as we can make 

it. 

Senator AKAKA. You’ve reported that you’ve now hired about 

1,400 people to work—is there a—— 

Mr. GUERIN. No exactly, Senator. What I said is, based on a CEA data point of $92,000 per job, if you took the $130 million that’s 

coming to the State of Hawaii, that could potentially equate to 

1,400 jobs. 

Senator AKAKA. Thank you very much, Mr. Chairman. 

Chairman INOUYE. Thank you. 

I’d just like to add, and join Senator Akaka on commending the 

military on child development programs. I think most Americans 

don’t realize that in World War II the—my regiment was quite, I 

think, typical. Four percent of the officers and men were married, 

96 percent were single. Today, 70 percent are married, with dependents, and 30 percent single. As a result, we have more children in the military than ever before. Your concerns about kids 

are, I think, well placed. 

General WILLIAMS. Sir, I would further say that family readiness 

is military readiness. 

Chairman INOUYE. Thank you, sir. 

And thank you, I’d like to thank the panel. We appreciate it very 

much. 

Our next panel is made up of the Executive Vice President and 

Chief Information Officer of Hawaii Pacific Health, Mr. Steve Robertson, and the Director of Continuing/Distance Education and 

Strategic Planning, College of Pharmacy, University of Hawaii at 

Hilo, Dr. Karen Pellegrin. 

Mr. Robertson? Welcome, sir. 

STATEMENT OF STEVE ROBERTSON, EXECUTIVE VICE PRESIDENT 

AND CHIEF INFORMATION OFFICER, HAWAII HEALTH INFORMATION EXCHANGE 

Mr. ROBERTSON. Thank you. 

Thank you, Chairman Inouye, Senator Akaka, I want to thank 

you for inviting us to testify today. I’m actually here as the Board 

President of the Hawaii Health Information Exchange. And I’m 

happy to report that over the last few months, we’ve been awarded 

$11.4 million in grants under ARRA to facilitate the fundamental 

transformation of health information technology in the State and 

across the country. 
31 

The Hawaii Health Information Exchange is a nonprofit company 

that was formed in 2006 by a group of stakeholders—healthcare 

stakeholders—that were interested in actually beginning the process of working collaboratively to really improve the efficiencies and 

overall healthcare processes in the State. In September of last year, 

became the State-designated entity for implementing the Statewide 

Health Information Exchange. 

Our Board of Directors is broad, we’ve got representation from 

the community, the neighbor islands, and the local healthcare industry, spanning hospitals, physician groups and insurance plans. 

Over the next couple of years we’ve got two main goals as funded 

by these grants. The first one is to assist in the adoption of electronic health records and the second one is to enable the safe, secure health information exchange between care providers, among 

other things. 

And what I’d like to do is to kind of give you an example of what 

that really means from a practical sense. Today, if you walk into 

a physician’s office, more chances than not—greater than 50 percent of the time—what you see are paper medical records, sitting 

right there behind the registration desk. And all of your care is 

documented in that paper, and when you leave that visit, your care 

gets coordinated via faxes and other paper mechanisms. So, we’ve 

been operating that way for more than 100 years, and it’s served 

us well. But to really transform healthcare we need to do more 

than that, we need to go electronic. 

So, if we take that example a little bit further, let’s say we’ve got 

a patient who’s medivaced from a neighbor island into an Oahu 

emergency room. If it’s just paper alone, that emergency room physician—if the patient is unconscious and no one else is with that 

patient, the emergency room physician has to act on the information that’s available. If it’s all on paper, sitting in a clinic somewhere on a neighbor island, that’s not going to be particularly helpful. So, what will occur if we become electronic, in other words, if 

we can get all of our primary care physicians onto an electronic 

health records and get those electronic health records actually talking to each other, then we can provide better care by ensuring that 

emergency room physician has access to the complete medical 

record. 

So, that doctor will be able to look up that patient’s record, see 

what other kinds of medications, allergies might be present or the 

existing physical conditions of that patient, and provide the best 

possible care given the amount of information that’s available. 

Our goal is to use the ARRA funds to make that possible. So, 

when you look at our total funding of $11.4 million, to date we’ve 

added 7 physicians with the hope of creating a total of 27. But the 

real savings, and the real value is going to come from these increased efficiencies by providing better care. So, the fewer medical 

errors that are present, the less costly—the lower the utilization of 

hospital admissions, et cetera. 

As I said, the $11.4 million actually comes from two grants. The 

first one is to actually build—to plan and implement a Health Information Exchange in Hawaii. And that grant award amount is 

$5.6 million and do that over 4 years. The award occurred in February, so it’s fairly recent. So, we’re still in the early stages. 
32 

We’re in the process of developing the statewide health information technology plan, strategic plans and operational plans to do 

Health Information Exchange. And these plans will be submitted 

for approval to the State Coordinating Committee for Health IT in 

August with the expectation that we will get the strategic plan and 

operational plans approved later in the year so that we begin the 

hard work of actually creating the system. 

The second grant is a $5.8 million, 4-year grant awarded in 

April, and it’s to build the Hawaii Pacific Regional Extension Center. So, this grant covers Hawaii in addition to supporting Guam, 

Samoa, and the Marianas Islands. And its primary purpose is to 

help primary care physicians choose and implement electronic 

health records. So, the idea is, the more physicians we get on board 

with electronic health records, then we actually do through Health 

Information Exchange, provide better care across the State. 

Our operational plan has already been submitted and approved 

by the Office of the National Coordinator, and we expect to, again, 

this grant has two existing positions, so once the final rules and 

regulations regarding the meaningful use of electronic medical 

records is in place, we’ll begin the full rollout. So, the idea is that 

will be fully staffed within 12 months or sooner. 

In closing, I just want to say, Senator Inouye and Senator Akaka 

it’s—we very much appreciate the opportunity and the funding that 

Hawaii has. A lot of us have been talking about doing this sort of 

thing for a very long time but never really made real progress. And 

it’s only because of the ARRA stimulus money that we can actually 

now put these dreams to use to fundamentally change healthcare 

and set the foundation for healthcare reform across the country. 

Thank you very much. 

Chairman INOUYE. Thank you very much, sir. 

[The statement follows:] 

PREPARED STATEMENT OF STEVE ROBERTSON

Aloha Honorable Chairman Inouye, Honorable Chairman Akaka, and members of 

the Appropriations Committee. 

Thank you for offering the Hawai‘i Health Information Exchange (Hawai‘i HIE) 

this opportunity to testify today on the American Reinvestment and Recovery 

(ARRA) HITECH Act programs: the State HIE Program and the Hawai‘i-Pacific Regional Extension Center program. We appreciate your support in helping to secure 

this funding for Hawai‘i and for your commitment to improving the healthcare system. 

The Hawai‘i Health Information Exchange (Hawai‘i HIE) is a 501(c)(3) nonprofit 

company established in 2006 by leading healthcare stakeholders in Hawai‘i for the 

purpose of improving healthcare delivery throughout the State through seamless, effective, and safe health information exchange. In September of 2009, the Hawai‘i 

HIE was designated by the Governor as the entity to develop and implement a 

statewide health information exchange that will ultimately support the national 

health information network. 

The Hawai‘i HIE has a broad and representative board of directors that includes 

physicians, hospitals, insurance plans, community representatives, business representatives, laboratories, the John A Burns School of Medicine, and others. Our 

united vision is to build a statewide system that enables our patients to receive the 

best possible care by facilitating coordination between care providers and to improve 

health outcomes while improving efficiencies that help mitigate the spiraling costs 

of healthcare. The opportunities afforded by the American Reinvestment and Recovery Act of 2009 will help Hawai‘i to expedite its long-term HIE goals. 

On February 8, 2010, the Hawai‘i HIE was awarded a $5,602,318 grant under the 

State HIE Cooperative Agreement Program through the Office of the National Coordinator for Health IT (ONC) to develop and implement a State HIE Plan over a 4 
33 

year period. The HIE Cooperative Agreement Program builds on existing efforts to 

advance regional and state-level health information exchange while moving toward 

nationwide interoperability. 

Our goal, working with key stakeholders in partnership with the State Coordinating Committee for Health IT that includes members from the Department of 

Budget and Finance, Department of Human Services, Department of Health, Department of Accounting and General Services, and the Department of Commerce 

and Consumer Affairs, is to develop the State’s strategic and operational plans by 

August 31. Our Executive Director, Christine Sakuda, meets weekly with State 

Health IT Coordinator, Mark Anderson to ensure appropriate progress is being 

made. To date, we are on track. ONC approval of these plans is expected in October, 

with the hope that the work of building the Exchange can begin shortly thereafter. 

Transparency and inclusivity are two of Hawaii HIE’s core values. We recognize 

that broad community input from all of Hawai‘i is imperative to our process. We 

achieve this through our website at www.hawaiihie.org, our blog at http:// 

hawaiihie.ning.com/, and through open community meetings. To date, we have conducted informational meetings on the islands of Kaua’i, Maui, Molokai, Lana‘i, 

Hawai‘i Island, and O‘ahu. These meetings provided an overview of the State HIE 

plans and findings while encouraging community members to share their ideas and 

concerns. Our message was warmly received on all islands and well attended by the 

islands’ diverse healthcare stakeholder population. Overwhelmingly, the participants see the advantages of a health information exchange to improve the quality 

of Hawai‘i’s healthcare delivery system through increased coordination of care, 

ready access to needed information at the point of care and increased access to quality patient health information. 

The Hawai‘i HIE received a second grant award of $5,859,716 from ONC on April 

6, 2010 to manage the Hawai‘i Pacific Regional Extension Center (REC) Program. 

The goal of the Hawai‘i Pacific REC is to support primary care providers in effectively choosing and implementing electronic health records (EHRs), establishing privacy and security best practices, redesigning workflow, and instituting health information exchange. The Hawai‘i HIE has subcontracted with Mountain Pacific Quality 

Health-Hawai‘i (MPQH–H) and the Telecommunications and Information Group 

(TIP–G) at the University of Hawai‘i to serve all of the Hawaiian Islands, as well 

as Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. The ultimate outcome of the REC program is to help providers reach meaningful use of electronic health records, as defined by the Centers for Medicare and 

Medicaid Services (CMS), and, as a result, become eligible for stimulus incentives 

offered by the CMS Programs. 

The Hawai‘i-Pacific REC’s operational plan has been approved by ONC and we 

are now developing the administrative and project plans to meet the aggressive 

timelines set forth by ONC pending the final CMS rule on electronic medical record 

‘‘Meaningful Use’’ requirements. Meaningful Use is one of the yardsticks by which 

we will measure our success. 

In addition to improving health outcomes and mitigating the rising costs of 

healthcare, we believe these ARRA HITECH Act grants in coordination with the 

third ARRA HITECH Act grant on the Hawai‘i Island called the Hawaii County 

Beacon Community Consortium (HCBCC) will serve as a much needed catalyst in 

spurring more investments in health information technology throughout the State 

and further develop a demand for highly skilled information technology professionals. Christine Sakuda currently represents the Hawai‘i HIE on the Board of the 

HCBCC that help in state HIE planning efforts. Together, these initiatives bring us 

closer to achieving the same vision, where hospitals, clinicians, and patients are 

meaningful users of health IT, with measurable improvements in healthcare quality, 

safety, efficiency, and population health. 

Thank you for this opportunity to testify. 

HAWAI‘I HIE BOARD MEMBERS

Money Atwal—CFO & Chief Information Officer, HHSC East Hawai‘i Region 

(Hilo Medical Center) 

Francis Chan—Chief Information Officer, Clinical Laboratories of Hawai‘i, LLC 

Jennifer Diesman—Vice President, Hawai‘i Medical Service Association 

Susan Forbes—CEO, Hawai‘i Health Information Corporation 

Beth Giesting—CEO, Hawai‘i Primary Care Association 

Bruce ‘‘Skip’’ Keane—Community Member 

Emmanuel Kintu—Exec. Director, Kalihi Pa ̄lama Health Center 

Janet Liang—President, Kaiser Hawai‘i 

Wesley Lo—CEO, Maui Memorial Medical Center 
34 

Roy Magnusson, MD—Assoc. Dean, John A Burns School of Medicine 

John McComas—CEO, AlohaCare 

Gary Okamoto, MD—Past President, Hawai‘i Medical Association 

Kevin Roberts—President, Castle Medical Center 

Steve Robertson—Exec. Vice President and Chief Information Officer, Hawai‘i Pacific Health 

David Saito, MD—Officer, Hawai‘i Independent Physician’s Association 

Christine Sakuda—Executive Director, Hawai‘i HIE 

Barbara Kim Stanton—Exec. Director, AARP 

Jim Tollefson—President/CEO, Chamber of Commerce 

Lisa Wong—Member, Society of Human Resource Managers 

Raymond Yeung—Vice President, Diagnostic Laboratory Services, Inc. 

Jeffrey Yu, MD—Chief Technology Officer, The Queen’s Health System 

Chairman INOUYE. Dr. Pellegrin. 

STATEMENT OF DR. KAREN PELLEGRIN, Ph.D., M.B.A., DIRECTOR, CONTINUING/DISTANCE EDUCATION AND STRATEGIC PLANNING, 

COLLEGE OF PHARMACY, UNIVERSITY OF HAWAII AT HILO 

Dr. PELLEGRIN. On behalf of the University of Hawaii at Hilo 

College of Pharmacy, thank you very much, Senator Inouye, Senator Akaka, for the opportunity to participate in this field hearing. 

I am the Director of Continuing Education and Strategic Planning 

for the College and Principal Investigator for the Beacon grant. The 

Beacon Community Cooperative Agreement Program is funded 

through the U.S. Department of Health and Human Services Office 

of the National Coordinator for Health Information Technology. 

The Hawaii County Beacon Community Consortium is one of 15 

sites across the Nation selected to achieve the vision of healthcare 

where hospitals, clinicians and patients are meaningful users of 

health information technology, and together achieve measurable 

improvements in healthcare quality, cost efficiency, and population 

health. We were awarded over $16 million to achieve a more sustainable model of healthcare. 

The College of Pharmacy is honored to be the lead applicant organization for the Hawaii County Beacon Community Consortium. 

In addition to the College of Pharmacy, key stakeholder organizations include the Hawaii County acute care hospitals, federally 

qualified health centers, Hui Malama Ola Na Oiwi, East Hawaii 

IPA, the mayor’s office, HMSA, and the Hawaii Health Information 

Exchange, all committed to demonstrating the Beacon vision in Hawaii County. 

We’re in the startup phase of our grant, and we look forward to 

achieving the following milestones in the very near future. We will 

meet the other Beacon site team leaders in Seattle next week, the 

Microsoft Amalga Health Information Exchange for Hawaii Island 

will go live by the end of the third quarter of this year, Mayor 

Kenoi is featuring the Beacon project in his August 13 healthcare 

conference, Beacon officials from HHS will be visiting the Big Island in early August, and we expect our budget revisions to be approved by ONC very soon, at which time we will begin hiring staff. 

As with all of the Beacon communities, our proposed budget was 

reduced by about 19 percent, leaving a balance of approximately 

$16.1 million. Because of the importance of the human factor in 

successful implementation and use of information technology, no 

cuts were made to our original personnel budget, which includes 

funds for 15 to 17 full-time employees in Hawaii for 3 years. We 

believe that this is an important strategic investment, not only for 
35 

Hawaii County, but for the State of Hawaii and the Nation. The 

Hawaii County Beacon Community Consortium members are committed to ensuring a strong return on this investment. 

Thank you for the opportunity to testify. 

Chairman INOUYE. I thank you very much. 

[The statement follows:] 

PREPARED STATEMENT OF KAREN L. PELLEGRIN

On behalf of the University of Hawai‘i at Hilo (UHH) College of Pharmacy, thank 

you for the opportunity to participate in this field hearing. I am Karen Pellegrin, 

Director of Continuing Education and Strategic Planning for the College and Principal Investigator for the Beacon grant. The Beacon Community Cooperative Agreement Program is funded through the U.S. Department of Health and Human Services Office of the National Coordinator for Health Information Technology (ONC) 

under the American Recovery and Reinvestment Act (ARRA) of 2009. 

The Beacon Program provides funding to communities to build and strengthen 

their health information technology (health IT) infrastructure and exchange capabilities. These communities will demonstrate the vision of a future where hospitals, 

clinicians, and patients are meaningful users of health IT, and together the community achieves measurable improvements in healthcare quality, safety, efficiency, and 

population health. 

The Hawaii County Beacon Community Consortium was selected as one of 15 

sites across the nation at the cutting edge of electronic health record (EHR) adoption and health information exchange. We were awarded over $16 million to achieve 

a new level of sustainable healthcare quality and efficiency. We plan to demonstrate 

how health IT can help providers and consumers develop innovative ways of delivering care leading to sustainable and measurable health and efficiency improvements. Along with the other Beacon sites, our successes and lessons learned will 

guide state and other community efforts across the nation to achieve similar goals 

enabled by health IT. 

The UH Hilo College of Pharmacy is the lead applicant organization for the Hawaii County Beacon Community Consortium (HCBCC) application submitted on 

January 29. In addition to the College of Pharmacy, the stakeholders represented 

on the consortium governing board include senior leaders from the Hawaii County 

acute care hospitals, federally qualified health centers, Hui Malama Ola Na Oiwi, 

East Hawaii IPA, Mayor’s Office, HMSA, and the Hawaii Health Information Exchange (HHIE), all committed to demonstrating the Beacon vision in Hawaii County. 

Since the Beacon grant awardees were announced May 4, the Hawaii County Beacon Community Consortium has achieved the following milestones: 

—The Privacy Committee has completed a privacy policy, patient authorization 

form, and participant agreement. 

—The Hawaii Island Health Information Exchange was incorporated on June 22 

to prepare for the implementation of the Amalga HIE for Hawaii Island and for 

sustainability beyond the 3-year grant period. 

—All required documents have been submitted to ONCHIT on time. 

In the near future, we look forward to achieving the following milestones: 

—Team members will attend the first in-person meeting of all Beacon sites which 

will be held in Seattle July 12–14. 

—The Amalga HIE for Hawaii Island will go live in the third quarter of this year. 

—Mayor Kenoi is featuring the Beacon project in his August 13 healthcare conference. 

—Beacon officials from HHS will visit the Big Island in early August to discuss 

the importance of the Beacon sites and learn about our unique challenges and 

improvement plans. 

—We expect our budget revisions to be approved by ONCHIT soon, at which time 

we will begin hiring staff. 

As with all of the Beacon communities, our proposed budget was reduced by about 

19 percent, leaving a balance of approximately $16.1 million. Because of the importance of the human factor in successful implementation and use of information technology, our revised budget reflects that most of the cuts were in health information 

technology. No change was made to our original personnel budget, which includes 

funds for 15 to 17 full-time employees in Hawaii for 3 years. In summary, our current revised budget of direct costs includes over $6 million for health information 

technology, almost $5 million for staff in Hawaii, almost $1 million for consultants 

(particularly for care re-design and sustainability consultants), and almost $1 mil-
36 

lion in other expenses. Approximately $2.5 million in indirect costs will go to the 

University of Hawaii Hilo according to the federally negotiated rate. 

We believe that this is an important strategic investment not only for Hawaii 

County, but also for the State of Hawaii and the nation. The Hawaii County Beacon 

Community Consortium members are committed to working together to ensure a 

strong return on this investment. 

Thank you for this opportunity to testify. 

Chairman INOUYE. In recent days, I’ve been very much interested and concerned about what you’re talking about. I’m well 

aware that in cancer, very few cancer specialists operate their offices on naval islands—Malakai or Maui or places like that— 

they’re all in Honolulu. As a result, say, 5 years ago, if you were 

required to have chemotherapy, you were required to make 24 

trips. That’s extra cost. 

Today, with electronic telehealth and telemedicine, two trips 

would be enough—the first one to diagnosis and the last one to see 

how you’ve done well. And in between it’s done by electronic devices. And just to think the costs involved, the time spent, you’re 

saving a lot—a lot of lives. 

And I was impressed with statistics coming from Georgia where 

they have a large number of those with diabetes. And although 

rural Georgia has less in population than the city in Georgia, there 

are more amputees caused by diabetes in rural Georgia than in the 

town of Georgia. And it’s because of the lack of transportation, the 

lack of communications. 

So, what you’re doing for Hawaii is extremely important. It will 

provide first-class healthcare for all people, whether you’re a Nihau 

or Lanai or Malakai, and I commend all of you. 

And I’m glad to see the pharmacy college operating well. 

Dr. PELLEGRIN. Thank you. 

Chairman INOUYE. For you’re the only one in the Pacific, now. 

Dr. PELLEGRIN. Yes, that’s correct, that’s correct. 

We appreciate your support. 

Chairman INOUYE. Well, someday I may go in there and get myself an aspirin. 

Dr. PELLEGRIN. We’ll treat you well. 

Chairman INOUYE. Now, you spoke about collaboration between 

all of these federally approved centers and native Hawaiian centers 

and such. Can this model be employed in, say, Maui and Kauai? 

Dr. PELLEGRIN. It is certainly our belief and our intention that 

we will build a model that is scaleable and transportable. I would 

assume that each community will have its unique factors, but our 

goal is to develop a model that would be able to be adapted to other 

communities in Hawaii and likely the Nation. 

Chairman INOUYE. Well, I congratulate you for all of the fast advancements you’ve made so far. You’ve been in business for less 

than 2 years. 

Dr. PELLEGRIN. I think 2006 was the official start, but our final 

cohort of students will start this fall. 

Chairman INOUYE. Mr. Robertson, when will we achieve, say, 70 

percent of our doctors electronically fixed up, or most of our hospitals? Right now, I gather, nationally less than 5 percent? 

Mr. ROBERTSON. Yes. I think if we’re talking about locally or nationally, I know that I can tell you that Hawaii is actually doing 

pretty well, in terms of the hospitals. We’ve got our—at least three 
37 

of our largest healthcare systems in Hawaii are in electronic medical records and several others are getting their—or have some system. 

I think our biggest challenge is going to be in primary care. The 

cost and the impact to physician workflow is pretty dramatic. But, 

I think given the incentives, the CMS incentives and Medicaid incentives, that’s going to go a long way to propelling that. So, in 

terms of getting a number, if we’re successful, we’ll achieve that 

within 3 to 4 years. 

Chairman INOUYE. We’re watching your activity very closely, because if you’re as successful as you predict, you’ll get more money. 

Mr. ROBERTSON. We look forward to that. 

Chairman INOUYE. Senator Akaka. 

Senator AKAKA. Thank you very much, Mr. Chairman. 

I am so glad to hear in your testimony how you’re moving along 

here on our health programs, as well as our pharmacy programs. 

Dr. Pellegrin, I’m proud that Hawaii Beacon Community Consortium was selected, and it was selected to be one of only 15 sites 

nationwide to implement a Beacon Program. So, I congratulate you 

and all of your consortium colleagues in your successful efforts to 

secure this important grant. The college has significant strengths 

and challenges within its healthcare delivery system. 

Doctor, in your testimony you mention that the Beacon Program 

communities will achieve measurable improvements in high-quality, safety, efficiency, and population health. How does the consortium intend to achieve these goals? 

Dr. PELLEGRIN. We are in the process of submitting our final set 

of measures and plans for achieving improvements in those measures. Some of the key areas that we are looking at to achieve measurable improvement is in things like access to appropriate care, so 

we can look at, for example, the numbers of patient who need to 

leave the island to receive care, the ability to provide specialty care 

on the island. 

Another important area is in the area of prevention and management of chronic disease. And a key measure of that will be, and is 

nationally, preventable hospitalizations for particular conditions of 

chronic diseases. If we are managing those patient populations 

well, we can keep them out of the hospital. We can prevent, at 

least, some of those hospitalizations. 

And then finally, we’re also looking at measurable improvements 

in the reduction of disparities among populations at risk. As I know 

you know, the Native Hawaiian population has a shorter life expectancy than other populations. This is a 3-year grant, and so we 

are going to focus on areas like diabetes, where there is a higher 

rate among the Native Hawaiian population. And organizations 

like Hui Malama Ola Na Oiwi play such an important role in ensuring the delivery of culturally competent care to that population. 

So, we look forward to working with that organization closely, to 

learn lessons from them and apply those throughout the county. 

Senator AKAKA. Well, I certainly want to wish you well. And 

that, without question, it will certainly be achieved. 

Dr. PELLEGRIN. Thank you. 

Senator AKAKA. Mr. Robertson, public health surveillance data 

helps the Department of Health and healthcare providers, as well, 
38 

identify trends and react to epidemics—food poisoning and other 

adverse situations. How will the coalition interface with the public 

health surveillance data, and what will the potential benefits of 

this increased collaboration be? 

Mr. ROBERTSON. Okay, well, that is a fundamental requirement 

for the Health Information Exchange. And we are working with the 

Department of Health and the Hawaii emergency surveillance system to do that. And we’ve actually piloted some of that effort, already, separately between Hawaii-Pacific Health, and the Queen’s 

Medical Center to provide that data and set those data standards. 

So, the idea is that many of those standards and protocols will 

be adopted by the Health Information Exchange so that all can 

participate. But we’re probably—we’re still a few months from 

being able to do that. 

Senator AKAKA. Thank you. Thank you very much. 

The health information technology, Mr. Robertson, has—to improve the quality and accessibility of care, reduce costs and medical 

errors. What is your current evaluation of the use of health information technology in Hawaii? And how will the stimulus resources 

be utilized to promote greater use of health technology? 

Mr. ROBERTSON. I think Hawaii is leading the country with regard to the adoption of health information technology. I think— 

there’s a national organization called the Health Information Management Society, it’s a professional group that actually benchmarks 

our organizations. And when you look at where Hawaii is, many of 

its top providers are in the top 10 percent of the country with their 

capabilities. I think that puts us in a really good position to make 

these programs really effective. 

The ARRA stimulus money, in addition to the incentives for hospitals and physicians to implement electronic medical record is 

going to accelerate that adoption curve over the next 3 to 5 years, 

we’re starting to see a lot of that activity today. 

Again, that just positions us better to do that kind of communication to truly coordinate care, and to provide a level of—actually put 

ourselves in a position so that we can hold ourselves all accountable, with true, transparent performance measures, which will 

drive that adoption even more, so that we can all compete on quality and cost. 

Senator AKAKA. Thank you very much, Mr. Robertson. 

Thank you, Mr. Chairman. 

Chairman INOUYE. Dr. Pellegrin, Mr. Robertson, thank you very 

much. 

Mr. ROBERTSON. Thank you, Senator. 

Chairman INOUYE. Our third panel, Cable Administrator, Hawaii 

Department of Commerce and Consumer Affairs, Mr. Clyde 

Sonobe; Vice President for Information Technology and Chief Information Officer University of Hawaii, Dr. David Lassner; Vice President, Gold Ivory, LLC, Ms. Su Shin; and the General Counsel of 

Hawaiian Telecom, Mr. John Komeiji. 

I thank you for joining us this morning, Mr. Sonobe. 
39 

STATEMENT OF CLYDE S. SONOBE, ADMINISTRATOR, CABLE TELEVISION DIVISION, DEPARTMENT OF COMMERCE AND CONSUMER 

AFFAIRS, STATE OF HAWAII 

Mr. SONOBE. Good morning, and thank you Chairman Inouye, 

and thank you for inviting me to testify about the state of Hawaii’s 

Broadband Mapping Project under ARRA and the impact of its 

grant to Hawaii’s citizens. It’s a privilege to appear before you. 

The State of Hawaii’s Department of Commerce and Consumer 

Affairs (DCCA) has been awarded a $1.9 million Federal grant to 

develop an interactive, online map that can be used by consumers 

to identify the availability, speed, and location of broadband services in the State of Hawaii. The grant includes approximately $1.4 

million in funds for broadband data collection and mapping activities over a 2-year period, and $500,000 in funds for broadband 

adoption activities over a 5-year period. 

Hawaii’s map will be included as part of the national broadband 

map that is being developed with input from each of the States. 

The CCA has teamed with the University of Hawaii and the Pacific 

Disaster Center to complete the mapping portion of the project. 

Using substantial expertise and resources available within the 

State, the team has made significant progress in completing multiple layers of real-time location and broadband serviceability data. 

Broadband providers have been generally cooperative, and staff at 

the U.S. Department of Commerce’s National Telecommunications 

and Information Administration have been very helpful in assisting 

DCCA through its various Federal grant obligations. 

Although the mapping data is still being processed, it is anticipated that the results will reinforce the State’s longstanding position that portions of Hawaii are extremely difficult to serve, and as 

a result, broadband availability is very low in remote regions of the 

State. Accordingly, DCCA has recently requested additional Federal funding in the amount of $2.4 million from the National Telecommunications and Information Administration (NTIA) to pursue 

two Federal programs: one for State broadband capacity-building, 

and one for technical assistance and outreach. These two programs, 

which are still being organized, are paying that increasing 

broadband adoption and penetration in the State and coincide with 

parallel State program resulting from recent State legislation, 

House Bill 2698, relating to technology, telework promotion, and 

broadband assistance. 

DCC believes the mapping activities promote the State’s longterm broadband plan, as developed by the State task force. The 

State task force was established in 2007 to provide recommendations on how to advance broadband in the State. In its final report, 

dated December 2008, the task force made four recommendations, 

including, establishing a forward-looking vision to make Hawaii 

globally competitive; creating a one-stop broadband advancement 

authority; welcoming trans-Pacific submarine fiber to Hawaii; and 

stimulating demand for broadband. 

DCCA’s mapping project will produce highly accurate and reliable resource for consumers in Hawaii, enabling them to identify 

and choose between the growing number of broadband services that 

are becoming available in the State. The broadband map will also 

encourage increased competition between broadband service pro-
40 

viders, by giving them additional information on communities within the State that would benefit from availability of new broadband 

services. 

Furthermore, DCCA’s broadband adoption programs will complement State efforts and goals to reach out to consumers and increase broadband penetration. 

In sum, the ARRA has been beneficial in helping to further the 

State’s objective in its broadband plan. It is vital for DCCA to ensure that all citizens of Hawaii receive the most benefit from the 

stimulus funding, and have meaningful access to broadband services. 

Thank you, again, for this opportunity to appear before you today 

and for your continued help in the area of broadband and telecommunications. 

Chairman INOUYE. Thank you, Mr. Sonobe. 

[The statement follows:] 

PREPARED STATEMENT OF CLYDE S. SONOBE

Chairman Inouye and Members of the Committee, thank you for inviting me to 

testify about the State of Hawaii’s broadband grant under the American Recovery 

and Reinvestment Act, and the impact of its grant on Hawaii’s citizens. It is a privilege to appear before you today. 

The State of Hawaii’s Department of Commerce and Consumer Affairs (DCCA) 

has been awarded a $1.9 million Federal grant to develop an interactive online map 

that can be used by consumers to identify the availability, speed and location of 

broadband services in the State of Hawaii. The grant includes approximately $1.4 

million in Federal funds for broadband data collection and mapping activities over 

a 2-year period, and $500,000 in Federal funds for broadband adoption activities 

over a 5-year period. 

DCCA has teamed with the University of Hawaii’s Pacific Disaster Center and 

other entities within Hawaii to complete the mapping portion of the project. Using 

the substantial expertise and resources available within the State, the team has 

made significant progress in compiling multiple layers of real-time location and 

broadband serviceability data. Broadband providers have been generally cooperative, apparently recognizing the public benefits that can be achieved through this 

process, and staff at the U.S. Department of Commerce’s National Telecommunications and Information Administration (NTIA) have been very helpful in shepherding DCCA through its various Federal grant obligations. 

Although the mapping data is still being processed, it is anticipated that the results will reinforce the State’s long-standing position that portions of Hawaii are extremely difficult to serve and, as a result, broadband availability is very low in remote regions of the State. 

Further, the broadband adoption and penetration rate may be relatively low 

throughout the State as compared to the rest of the country. 

Accordingly, DCCA has requested additional Federal funding from NTIA to pursue two Federal programs—one for state broadband capacity building and one for 

technical assistance and outreach. These two programs, which are still being organized, are aimed at increasing broadband adoption and penetration in the State and 

coincide with a parallel state program resulting from state legislation H.B. 2698, relating to technology, telework promotion and broadband assistance. 

DCCA is working to manage these two efforts jointly. Such an approach should 

result in substantial synergies, including the use of State and Federal funds in a 

20/80 percent match to fund the hiring of up to three people, including their expenses, to work on broadband adoption. 

DCCA believes its matching and planning activities promote the goals of the 

State’s broadband plan as developed by the Hawaii Broadband Task Force (Task 

Force). The Task Force was established in 2007 by Hawaii’s State Legislature 

through Act 2 of the First Special Session of Hawaii 2007 to provide recommendations on how to advance broadband within the State. In its Final Report dated December 2008, the Task Force made four recommendations, including: Establishing 

a Forward-Looking Vision to Make Hawaii Globally Competitive; Creating a OneStop Broadband Advancement Authority; Welcoming Trans-Pacific Submarine Fiber 

to Hawaii; and Stimulating Demand for Broadband. 
41 

DCCA’s mapping project will produce a highly accurate and reliable resource for 

consumers in Hawaii, enabling them to identify and choose between the growing 

number of broadband services that are becoming available in the State. The 

broadband map will also encourage increased competition between broadband service providers by giving them additional information on communities within the State 

that would benefit from the availability of new broadband services. Furthermore, 

DCCA’s broadband adoption programs will complement the State’s efforts and goals 

to reach out to consumers and increase broadband penetration. 

In sum, the ARRA has been beneficial in helping to further the State’s objectives 

in its broadband plan. It is vital for DCCA to ensure that all citizens of Hawaii receive the most benefit from the stimulus funding and have meaningful access to 

broadband services. 

Thank you again for the opportunity to appear before you today. I would be happy 

to answer any questions you may have. 

Chairman INOUYE. Dr. Lassner. 

STATEMENT OF DR. DAVID LASSNER, VICE PRESIDENT FOR INFORMATION TECHNOLOGY AND CHIEF INFORMATION OFFICER, UNIVERSITY OF HAWAII 

Dr. LASSNER. Mr. Chairman, thank you for this opportunity to 

share some perspectives from the University of Hawaii on the impact of the ARRA on broadband in Hawaii. 

Let me quickly summarize four key aspects of the ARRA that advance broadband. The ARRA charged the Federal Communications 

Commission, the FCC, to create our Nation’s first national 

broadband plan, and I know there’s been some talk about that this 

week, here. That plan was delivered in March, and implementation 

activities are now underway. 

Second, the ARRA provided funding for State-based data collection efforts to implement, in fact, your Broadband Data Improvement Act of 2008. Mr. Sonobe just commented on that activity. The 

university is proud to be working with him on this. 

Third, the ARRA created some significant new grant and loan 

programs in the Department of Commerce and Department of Agriculture to actually deploy broadband. And I’ll say a little bit more 

about those programs and their hoped-for impact in Hawaii, as will 

my colleagues. 

And then fourth, the ARRA provided substantial funding to the 

National Science Foundation, which although it’s not the lead 

agency on broadband, they developed some programs which can 

support broadband, including in Hawaii. 

I should also say that, from the UH perspective, a number of our 

faculty are quite entrepreneurial, and have competed for, and won, 

so far 71 projects totaling $62.8 million in non-broadband related 

ARRA activities that often aren’t thought of, because they come 

from Department of Health and Human Services, Department of 

Energy, Department of the Interior, Department of Justice, where 

our faculty are always trying to advance the state of the art in 

their professions. 

The projects I’ve been involved with have been primarily focused 

on connecting anchor institutions or community anchor institutions 

throughout the State of Hawaii. And one of the real breakthroughs 

over the past couple of years has been a recognition by the Obama 

administration of the importance of connecting the Nation’s 

schools, libraries, community colleges, hospitals and universities to 

begin to really create a broadband future for our Nation. Connecting these institutions creates jobs, it increases the infrastruc-
42 

ture that than can be available for connecting homes and businesses, and these are the institutions that also deliver the public 

services that really deliver on the promise of broadband for our Nation that are education—cheaper, faster, more available—human 

services, health services—such as we just heard about on the previous panel—and economic diversification and development. 

The university submitted four proposals and the sad story is that 

none of them have yet been funded, but the good story is that they 

are all still in play as we speak. And any of them could be funded, 

literally, any day, at this point. So, let me quickly summarize these 

proposals. 

One of them is called Ke Ala ‘lke, the Path to Knowledge. And 

this is a large proposal prepared by the University of Hawaii system, the Hawaii State Department of Education and Hawaii State 

Public Library System that would provide fiberoptic capability at 

every public school, every public library, every community college, 

every public university, and all of the remote learning centers on 

six islands throughout the State of Hawaii, providing gigabit capability, or 1 billion bits per second, at every one of these locations. 

That one would create, using the Federal Government’s estimate, 

about 430 jobs and this would really put Hawaii in a leadership position, I believe we would be the first State in the country that 

would have every public school and every public library on every 

island connected. 

Our second proposal fits in as a Public Computing Center proposal. This, again, involves the University of Hawaii and the Hawaii State Public Library System. We would acquire 693 new public-use broadband-connected computers at 66 locations, again, on 

six islands. And the idea is that we would use the community colleges and public libraries as a safety net for members of the public 

who cannot afford broadband or computers, or who are homeless, 

and they would have locations where they would be able to access 

broadband capabilities to look for jobs, to advance themselves economically, participate in education and training, perhaps even 

make appointments for healthcare—the kinds of things that they 

really can’t do. And using the public libraries and the community 

colleges, they have extensive outreach capabilities, and these are 

institutions that are very accustomed to serving the public 

throughout the State. 

The second two proposals are to the National Science Foundation 

(NSF), and these really address the area of advancing our science 

and technology capabilities for economic development and diversification. 

The first one is in a new program that NSF created called Academic Research Infrastructure. And this is something I’ve been 

struggling with for about 20 years, trying to keep Hawaii—like 

Alaska, we have real challenges connecting to the rest of the Nation, because we have to rely on expensive submarine fiber. This 

is a $10 million proposal to the National Science Foundation that 

would provide us with connectivity to the U.S. mainland, and to 

the national fiberoptic networks, comparable to most other universities, two 10-gigabit per second connections. 

The fourth proposal, the second one to the National Science 

Foundation, is to the EPSCoR Program, I think you’re familiar 
43 

with, and that is an inter-island high-speed connectivity proposal 

that would connect the University of Hawaii at Hilo, picking up the 

Manoa Kay observatories on the way, connect them to the Maui 

Super Computing Center, then over to Oahu to the University of 

Hawaii at Manoa and then onward to Kapiolani Community College, which has been very involved in science and technology and 

engineering education on a statewide and, in fact, throughout the 

Pacific basis. 

The first two of these proposals were ranked first and second by 

the Governor in her ranking of the proposals to the Department of 

Commerce and if all four of these proposals are funded and in fact, 

all four are still currently under review and in play, this would be 

a hugely—I think you can see how these fit together, connecting all 

of our schools, libraries, community colleges to each other, connecting between the islands, connecting to the rest of the country 

and providing the safety net of computers for the public that really 

doesn’t have access to these capabilities, yet, at home. 

Last time I was here, I reported on some of the concerns we had 

with some of these programs. And I’m happy to report that the Department of Commerce really stepped up to the plate. I think it improved their online system for submission of proposals, the guidelines were much friendlier for us, for the kinds of proposal that we 

wanted to submit, to connect community anchor institutions to 

serve the public. And I—I could use the word ‘‘brutal’’ but I would 

say they are exceeding diligent in ensuring that our proposals are 

well-founded, both technically and administratively, and that we’re 

going to be capable of fulfilling. And I think that’s part of the reason—they’re being extremely careful about what they fund. 

These are—it’s been a real pleasure, I think, to work—for us to 

work with the Department of Education and the Hawaii State Public Library System on a statewide basis are really looking after the 

needs of people on all of our islands, together and holistically. 

I’ll just share one concern that, last week, I know the House supplemental budget included a rescission of some funds for some of 

these broadband programs. And, obviously, if any funds are cut 

from these programs, that’s going to limit the number of awards 

that can be made. And so, for those of us who are still pending, 

that’s of concern, that less funds means less projects that would be 

funded, potentially, including ours. 

Thank you for this opportunity. 

Chairman INOUYE. I thank you, sir. 

[The statement follows:] 

PREPARED STATEMENT OF DAVID LASSNER

Thank you for this opportunity to share some perspectives from the University of 

Hawaii (UH) on the impact of the ARRA on broadband in Hawaii. 

American Recovery and Reinvestment Act (ARRA) of 2009 and Broadband 

It is useful to summarize some key elements of the ARRA that advance 

Broadband: 

—The ARRA charged the Federal Communications Commission to create our nation’s first national broadband plan. The FCC delivered that plan to Congress 

and the nation in March of this year, and implementation activities are now underway. 

—The ARRA provided funding for state-based data collection efforts to implement 

the Broadband Data Improvement Act of 2008. Mr. Clyde Sonobe of the State 

Department of Commerce and Consumer Affairs, is leading this initiative for 
44 

Hawaii. The University is pleased to be partnering in this initiative by applying 

the expertise in geospatial information systems of the Pacific Disaster Center 

on Maui, which is now managed by the University of Hawaii. 

—The ARRA created new grant and loan programs in the Department of Commerce and Department of Agriculture to deploy broadband in accord with a 

clearly defined set of statutory purposes and to provide support for broadband 

adoption and usage. 

—The ARRA provided substantial additional funding for the National Science 

Foundation (NSF), some of which was used for programs that can fund 

broadband connectivity. 

I will focus my testimony today on these latter two sets of programs and describe 

the University of Hawaii initiatives to respond to these opportunities. 

The Importance of Anchor Institutions 

I would like to first provide some context regarding the importance of community 

anchor institutions in advancing our national broadband agenda. 

Last spring I had the opportunity to work with a group of colleagues around the 

country as we tried to communicate to the new Obama Administration the importance of colleges, universities, schools, libraries and hospitals as broadband anchors 

in creating our nation’s future. I believe that it is now well-understood within the 

Federal government that connecting these institutions will create jobs, increase our 

infrastructure capacity to enable higher-speed broadband in more places, improve 

the quality of a wide range of educational, public and human services, drive economic diversification and development, increase our nation’s competitiveness, create 

future demand for more advanced broadband services, and provide a safety net for 

those who might otherwise be left behind. 

The importance of connecting community anchor institutions is emphasized in 

particular in the National Broadband Plan and in the Department of Commerce’s 

Broadband Technology Opportunities (BTOP) program. In addition, the National 

Science Foundation continues to have a keen interest in connecting colleges and universities, among others, for the purpose of advancing research and related Science 

and Technology capabilities. 

The University of Hawaii’s Broadband-Related ARRA Proposals 

In addition to our work with Mr. Sonobe on the Broadband Data Mapping project, 

the University has four broadband-related ARRA proposals under active consideration at this time. 

Ke Ala ‘Ike.—The University of Hawaii, Hawaii Department of Education and Hawaii State Public Library System collaborated to submit a large statewide Comprehensive Community Infrastructure proposal to the Broadband Technology Opportunities Program (BTOP) to provide or upgrade direct fiber optic connectivity at 

every public school including public charter schools, every public library, every community college, every public university, and every community college remote education center used for distance learning on six islands. As a result of this project, 

each of the 388 participating sites would have external connectivity of at least 1 gigabit (billion bits) per second. This proposal would also deploy advanced high definition interactive distance learning capabilities in higher education to begin to demonstrate the uses and benefits of higher speed broadband services. Notable benefits 

to disconnected communities would include pulling the first fiber optic cable to 

Hana, Maui and Lanai City. If this proposal is funded, I believe that Hawaii would 

be the first state in the Nation to have provisioned direct fiber optic connectivity 

to every public school, every public library, every community college and every public university with gigabit or faster connectivity. Using the Federal government’s 

methodology for understanding job creation, it is estimated that 430 job-years would 

be created by this project including 275 indirect and 155 induced job-years. The 

total project cost is $42,466,000, and this project is currently undergoing a due diligence review. 

Access for All.—The University of Hawaii and the Hawaii State Public Library 

System also collaborated on a Public Computing Center proposal to the BTOP program to provide public computers and training in every public library and in community college libraries and education centers throughout the State. A total of 693 

new public-use broadband-connected computers would be provided in 66 locations on 

six islands. In 2008 the Hawaii Broadband Task Force recommended that ‘‘Government lead by example in demonstrating the value of broadband to our citizenry, deploying broadband services to the public, and ensuring that we do not leave behind 

the economically disadvantaged members of our communities who may be inhibited 

from full participation in the 21st century.’’ While the current financial crisis has 

made it impossible for the State to financially invest in this vision, the ‘‘Access for 
45 

All’’ project partners have taken this to heart and worked together to develop this 

proposal to create a statewide safety net for our most disadvantaged citizens This 

safety net will be used to help Hawaii’s citizens improve their social, personal and 

economic well-being. The total project cost is just over $2.4 million. This project is 

currently also undergoing a due diligence review. 

Connecting Hawaii to the U.S. National Cyberinfrastructure.—Using a portion of 

the ARRA funds appropriated to the National Science Foundation, NSF created the 

Academic Research Infrastructure Program: Recovery and Reinvestment (ARI–R2) to 

support 21st century research and research training infrastructure in our Nation’s 

academic institutions and nonprofit research organizations. The program’s purpose 

is to revitalize existing research facilities so that they provide next-generation research infrastructure and facilitate the integration of researchers with shared resources such as remote instruments and research platforms, data repositories, and 

national computing facilities. The ARI–R2 program invited proposals for broadband 

connectivity to support research, and the University of Hawaii submitted a proposal 

to address a previously unfunded recommendation in the America COMPETES Act 

to improve high-speed connectivity between Hawaii’s research and education community and the national cyberinfrastructure for research. This is particularly timely, given the announcement last week of $62 million in BTOP funding to Internet2 

and partners for a major upgrade the fiber optic research and education backbone 

network that serves the 48 states on the U.S. mainland. This proposal would provide two 10 gigabit per second circuits between Hawaii and the West Coast, with 

a total project cost of just under $10 million. This proposal is currently under active 

consideration by the NSF. 

Connecting the Islands: Cyber Connectivity for Science and Technology in Hawaii.—ARRA funding also enabled NSF to create a new Research Infrastructure Improvement Program: Inter-Campus and Intra-Campus Cyber Connectivity (RII C2) 

for the jurisdictions participating in the Experimental Program to Stimulate Competitive Research (EPSCoR). RII C2 is intended to enhance broadband access for 

academic research and the utilization of cyberinfrastructure consistent with the jurisdiction’s Science and Technology plan. The University submitted a proposal to 

provide 10 gigabit per second connectivity from the University of Hawaii at Hilo to 

the Maui High Performance Computing Center to UH-Manoa to Kapiolani CC, 

which is active in Hawaii’s EPSCoR program activities. This is about a $1.2 million 

proposal, which is also currently under active consideration by the NSF. 

The Department of Commerce requested each governor to provide input on the 

proposals submitted from within their states, and the first two proposals described 

above were ranked #1 and #2 respectively. 

In addition to these four active proposals, the UH Pacific Business Center Program requested just over $1.5 million in BTOP Sustainable Broadband Adoption 

funding for a Pacific Basin Islands Ecommerce Portal that would set up a 

broadband-based ecommerce portal for the U.S. affiliated Pacific Basin islands, specifically American Samoa, the Commonwealth of Northern Marianas Islands, the 

Republic of the Marshall Islands, the Republic of Palau, Guam and the Federated 

States of Micronesia. In addition, the U.S. State of Hawaii will be served, and will 

also act as the base of operations. This proposal has not entered a due diligence 

Others on the panel will testify regarding additional broadband proposals submitted from within Hawaii and the benefits they would provide. I will just observe 

that if all four of these currently active University proposals are funded, we will 

enjoy a fundamental leap in the capabilities available to the education and research 

community in Hawaii. We would have a world-class education and research network 

serving all islands within the State, with adequate domestically-provided 

connectivity for the first time in many years. Of course, with the funding of a new 

100-gigabit per second national research and education broadband backbone network on the mainland, we will need to continue to be vigilant and active to avoid 

falling behind again. 

Observations on the Process 

At the August hearing on this topic in Hawaii, I shared with the Committee a 

number of concerns with the BTOP program as implemented in Round 1. It turned 

out that no Hawaii BTOP proposals were funded during Round 1. 

From my perspective representing a Community Anchor Institutions within Hawaii and as a repeat applicant to the BTOP program, I am happy to report that 

there were substantial improvements in Round 2 of the program. The new online 

system that was so troublesome during Round 1 was dramatically improved for 

Round 2. And more importantly, the program guidelines for Comprehensive Community Infrastructure were much friendlier to Community Anchor Institutions, including the public schools, libraries, public universities community colleges and the re-
46 

mote education centers through which we provide so many services throughout the 

State. 

I should also report to this Committee that my limited experience with four ARRA 

proposals at two Federal agencies indicates that these agencies are taking their 

stewardship responsibilities extremely seriously. Their technical and administrative 

review processes have been extremely thorough and highly focused on ensuring compliance with all applicable rules and laws, verifying the public benefit, and ensuring 

that the projects can be executed as proposed. 

Conclusion 

At the time of this writing we are in active conversation with Federal officials regarding all four of the University’s ARRA broadband proposals. We are hopeful for 

success, and believe that with anchor institutions in nearly every Hawaii community on every island connected at very high speeds we will be able to dramatically 

advance education and research throughout the State. 

Just as importantly, these projects will enable us to fulfill our responsibilities as 

Community Anchor Institutions. Hawaii’s ambitions for ubiquitous high-speed 

broadband connectivity as expressed in the Hawaii Broadband Task Force Report 

are far more ambitious than those called for in the National Broadband Plan. Widespread gigabit connectivity, beginning in these institutions, will also drive adoption 

and demand by consumers and businesses for advanced applications that could return the United States to the international leadership position in affordable high 

speed connectivity we lost over the past decade. 

Chairman INOUYE. Ms. Shin. 

STATEMENT OF SU SHIN, VICE PRESIDENT, GOLD IVORY, LLC 

Ms. SHIN. Thank you. 

Mr. Chairman, Thank you so much for inviting me here today to 

provide some testimony on Gold Ivory’s experience with the ARRA. 

First, a little bit of background on our company. Gold Ivory is an 

affiliate of Waimana Enterprises, which is a native Hawaiian company with many, many years of utility infrastructure experience 

and also intimate knowledge of telecommunications issues unique 

to Hawaii. In the last decade, Waimana focused its resources on 

providing telecommunication services to the most rural and underserved areas of our islands. Through these efforts, Waimana witnessed and experienced the lack of basic communications infrastructure and equipment for local public safety agencies to be able 

to perform their duties adequately. And Mr. Sonobe talked about 

some of the lack of access in remote areas in his statements, as 

well. 

For the past 3 years, Waimana has been working very closely 

with public safety agencies trying to find a way to help them build 

out this much, much needed infrastructure. Currently, the public 

safety agencies in our rural communities rely on an antiquated system that does not provide first responders with sufficient access to 

communication where and when they need it. 

Also, as experienced during Hurricane Anike, the network is not 

hardened, and is susceptible to outages. When Congress passed the 

ARRA, creating the Broadband Technology Opportunities Program, 

or BTOP, this became—or we realized this was a vehicle for providing funding necessary to build out this public safety communications infrastructure statewide that was so needed. 

Initially, we had met with all four counties to design a statewide 

network, dedicated for public safety use. As it turns out, because 

their needs were greater, only Kauai, Maui, and Hawaii counties 

chose to participate. 

Last year, Gold Ivory submitted an application in response to the 

first round of BTOP funding. The application proposed a robust 
47 

and hardened network that provided interoperability and increased 

coverage across all neighbor islands that would survive a catastrophic event so that first responders can coordinate recovery efforts, both on-island and off. 

Upon the request of the counties, it also transferred ownership 

of the completed network to the public safety agencies for their 

dedicated use. 

Our application was, unfortunately, denied in the round 1 funding, because it did not allow commercial traffic to interconnect to 

this public safety network. So, when the second round of funding 

was announced, Gold Ivory resubmitted its application, however we 

made a key revision to allow interconnection with commercial traffic to meet those programmatic requirements. The network was 

strategically designed to provide both backhaul capacity, as well as 

maximum coverage for future LTE–700 MHz technologies, which 

was recently authorized by the Federal Communications Commission (FCC) for public safety use. 

We just completed the due diligence phase, which Dr. Lassner 

talked about just now, of our second application. During that process, however, the National Telecommunications and Information 

Administration or NTIA, with very little regard for its impact on 

the needs of public safety. As a result, our network was stripped 

down to a skeleton system that provides limited redundancy and 

a significant reduction of capacity. This means that the missioncritical communications network of the public safety entities in our 

most rural and underserved communities will be vulnerable to a 

single point of failure. 

Also, during due diligence, we were required to meet cost metrics 

identified in a recent FCC technical paper. The paper identifies significant cost differences between a stand-alone public safety network, and an incentive-based partnership network. The fundamental difference between the two is that a stand-alone network 

model anticipates building an entirely new network from the 

ground up for a single customer base, much like our project is proposing to do. 

The incentive-based partnership is less costly to build out, because it assumes that public safety agencies will be able to leverage 

existing commercial infrastructure and have access to an existing 

back-haul network. 

Due to the remote and rural nature of our project sites, there is 

little to no existing broadband infrastructure and it is extremely 

costly to build out. 

Our proposal is a combination of a stand-alone network, and an 

incentive-based partnership model. Because of the need to build out 

expensive infrastructure, our network’s initial capital investment is 

similar to that of a stand-alone public safety network. However, 

our ongoing operating expenses will be lower, much like an incentive-based partnership. This is possible because of the revenue generated from its commercial interconnections, as required by this 

Federal program. 

While our network is a hybrid model, the NTIA due diligence 

team only evaluated our application costs against the metrics for 

the less costly incentive-based partnership model. We do—we 

would like to highlight the fact that our total project budget was 
48 

roughly $180 million, but of that amount, $50 million is an in-kind 

contribution to the project that we provided. We would like to highlight the fact that that’s 26 percent of the total project cost. And 

the reason that large in-kind contribution is possible is because we 

are able to leverage our existing state-of-the-art buried fiber network that currently is in existence. 

All of this being said, the final design of our proposal still provides the counties with a basic network infrastructure that does 

not exist today. This opportunity would not be possible without the 

passage of the ARRA. We look forward to the positive impacts this 

historic program will bring to Hawaii, including job creation, and 

the many social benefits of broadband connectivity mentioned by 

all of our previous speakers. And we humbly request your support 

of our project. 

Thank you for the opportunity to testify. 

Chairman INOUYE. I thank you very much, Ms. Chin. 

[The statement follows:] 

PREPARED STATEMENT OF SU SHIN

Mr. Chairman and Committee members, my name is Su Shin and I am the Vice 

President of Gold Ivory, LLC. Thank you for inviting me here today to provide testimony on our experience with the American Recovery and Reinvestment Act of 2009 

(the ARRA). The United States Congress was bold and visionary in passing the 

ARRA to stimulate the economy and fuel a revival of jobs in America. As further 

explained below, Gold Ivory has attempted to bring the benefits and opportunities 

created in the ARRA from its origins in Washington, DC directly to the residents 

and businesses of our State. 

Gold Ivory is affiliated with Waimana Enterprises, Inc. (Waimana), a native Hawaiian company with many years of utility infrastructure experience and intimate 

knowledge of telecommunications issues unique to Hawaii. In the last decade, 

Waimana focused its resources on providing telecommunication services to the most 

rural and underserved areas of our islands. Through these efforts, Waimana witnessed and experienced the lack of basic communications infrastructure and equipment for local public safety agencies to perform their duties. This problem, however, 

is not exclusive to Hawaii. Thus, one of the five stated purposes of the Broadband 

Technology Opportunities Program (BTOP), created by the ARRA, is to support 

broadband programs that ‘‘improve access to, and use of, broadband service by public safety agencies.’’ Additionally, the express language of the ARRA identifies a native Hawaiian organization as an eligible grant applicant under the BTOP program. 

Thus, Waimana, through its affiliate Gold Ivory, identified BTOP as a means for 

providing critical broadband infrastructure to the remote areas of our state. 

In July 2009, the National Telecommunications and Information Administration 

(NTIA), Department of Commerce, issued the first BTOP Notice of Funds Availability (NOFA). Gold Ivory partnered with Raytheon and Alcatel-Lucent, industry 

leaders in broadband technology, to submit an application to design and construct 

a public safety broadband network to serve the rural counties of Kauai, Maui, and 

Hawaii. Gold Ivory worked closely with first responders from each respective county 

to identify essential broadband needs and address critical shortcomings. Three fundamental problems were identified across all three counties: 

—Lack of Coverage—first responders are unable to communicate with each other 

in many remote areas; 

—Lack of Capacity—first responders are unable to take advantage of current 

technology (e.g., video surveillance, mobile data services, CAD dispatch, and 

GIS/Mapping) due to insufficient bandwidth; and 

—Lack of Redundancy—currently, public safety agencies rely on a single network 

primarily supported by pole-hung fiber, which is highly susceptible to service 

outages due to natural and manmade disasters. 

Gold Ivory submitted an application to NTIA that addressed these problems by 

proposing a robust Hawaii Public Safety Broadband Network (HPSBN) that drastically increased the coverage areas on each island, provided virtually unlimited 

bandwidth through a pair of dedicated fiber (OC 192), and inter-connected the public safety agencies to support interoperability. Upon completion, Gold Ivory proposed 

to transfer ownership of the HPSBN to each respective county, which required that 
49 

the HPSBN be for the exclusive use of county agencies. Unfortunately, the NTIA 

denied Gold Ivory’s application on the basis that it did not allow commercial traffic 

to interconnect to the HPSBN, despite the NOFA’s recognition of unique law enforcement needs. 

In January 2010, NTIA issued a second NOFA for BTOP funding (Second NOFA). 

Gold Ivory again submitted an application for a robust Hawaii Broadband Network 

(HBN) to primarily serve the public safety agencies of the Counties of Kauai, Maui, 

and Hawaii. The HBN was strategically designed to provide both backhaul capacity 

and maximum coverage for future LTE 700 MHz technologies for public safety agencies. It also addressed the critical component of redundancy by providing back-up 

connections to ensure that mission critical communications are not interrupted and 

can survive disasters. Unlike the first application, however, the HBN was designed 

to allow interconnection with commercial traffic. 

Last month, Gold Ivory was notified by the NTIA that it qualified for advancement to the due diligence phase. The NTIA due diligence team was professional and 

responsive throughout the review process, and we wholeheartedly appreciate the 

significant responsibility placed upon the review team. However, in the spirit of providing constructive feedback to improve future programs aimed at improving public 

safety broadband networks, we respectfully call attention to two fundamental concerns. The first concern deals with the design standards of the HBN. As stated earlier, 

the HBN was primarily designed to generally accepted public safety reliability and 

survivability standards, which ensures a fully functioning network after a catastrophic event so that first responders can coordinate recovery efforts both on-island 

and with neighboring islands. Under the guidance of the NTIA due diligence team, 

however, the robust HBN was stripped down to a skeleton system that provides limited redundancy and a significant reduction in capacity from an OC48 to an OC12. 

This means that the mission-critical communications network of the public safety 

entities in the rural and underserved counties will be vulnerable to a single point 

of failure. 

The second concern is one of due process. After Gold Ivory submitted its second 

application, the Federal Communications Commission (FCC) issued an OBI Technical Paper Series entitled ‘‘A Broadband Network Cost Model: A Basis for Public 

Funding Essential to Bringing Nationwide Interoperable Communications to America’s First Responders’’ (April 2010) (the Technical Paper). The Technical Paper astutely identifies significant differences between a Stand-Alone Public Safety Network and an Incentive-Based Partnership Network. The Stand-Alone Public Safety 

Network model anticipates building an entirely new network from the ground up 

for a single customer base. The Incentive-Based Partnership leverages existing commercial assets that already have backhaul to a functioning core network, which 

eliminates the cost of building a new network from the ground up. The Stand-Alone 

Network would require at least 2.5 times more capital investment, excluding 

deployable equipment, and proportionally even more in operating costs. As such, the 

Technical Paper recommends the Incentive-Based Partnership model. 

Fundamentally, the HBN is a Stand-Alone Public Safety Network. The NTIA due 

diligence team, however, evaluated the HBN against the Technical Paper’s metrics 

for the less costly Incentive-Based Partnership model. From a due process standpoint, Gold Ivory respectfully challenges the fairness of holding its application to 

standards that were not referenced in the NOFA and published after the application 

deadline. This situation is exacerbated by the NTIA’s restriction of the HBN budget 

to meet metrics that are not relevant or applicable to a Stand-Alone Network model. 

Our due diligence period recently ended and we are awaiting a final decision from 

NTIA. However, we have been advised that our application is on hold pending final 

review of new applications submitted under a May 2010 amendment by the NTIA 

of its second NOFA to selectively accept applications for BTOP funding from state 

and local governmental entities that recently received FCC approval to use the 700 

MHz public safety broadband spectrum. As a qualified applicant, local and State 

agencies of Hawaii had until July 1, 2010, to submit an application. While Gold 

Ivory endorses the need for improvements to Hawaii’s public safety broadband infrastructure and equipment, it is unreasonable to delay our application process because 

BTOP applications are funded on a ‘‘rolling basis subject to the availability of 

funds.’’ 

That being said, the final design of the HBN still provides the counties with a 

basic network infrastructure that does not exist today and can be expanded over 

time. The NTIA should be applauded for the resources and efforts expended toward 

implementing the historic BTOP initiative of the ARRA. The FCC should also be 

commended for their creation of a National Broadband Plan and specifically recognizing the need to create a nationwide interoperable public safety broadband wire-
50 

less network for first responders and other public safety personnel. Finally, the 

United States Congress should be praised for their vision and leadership in steering 

our country through one of its worst economic crises. 

Thank you for the opportunity to testify on our experience with the ARRA. 

Chairman INOUYE. Mr. Komeiji. 

STATEMENT OF JOHN KOMEIJI, SENIOR VICE PRESIDENT AND GENERAL COUNSEL, HAWAIIAN TELCOM 

Mr. KOMEIJI. Thank you, Mr. Chair. Hawaiian Telcom also 

thanks you for the opportunity to testify before you today and to 

report to you the status of our applications with the two programs, 

the two programs being the Broadband Technology Opportunities 

Program as well as the Broadband Infrastructure Program (BIP). 

We have submitted applications for two projects, one coming 

under what they call BTOP and one coming under BIP. 

In terms of our BTOP application, we filed our application in 

conjunction with the Hawaii County to increase and improve 

broadband access for the residents, businesses and critical community facilities on the Big Island. Our total project is $6.2 million, 

and of that amount, we’re requesting that the Government assist 

us in the amount of $4.3 million. 

The primary purpose of that project is to create a ‘‘middle mile’’ 

segment between Pahala to Volcano. That would allow us to complete a loop around the entire Big Island, which allows for redundancy as well as resiliency for our network. 

We also would be upgrading broadband access points at 22 central office communications which would again allow greater 

broadband access to the residents and businesses on the Big Island. We also will be extending fiber facilities to the nine most critical county-designated sites to, again, allow them—for emergency 

responders, first responders, as well as in catastrophic emergencies. 

So, we believe that our project improves the lives of the people 

on the Big Island. We estimate that about 62,000 households will 

get increased broadband coverage; 4,300 businesses will get increased broadband coverage. We also will, as I mentioned, provide 

key points of communication for the county in this project. 

We estimate that about 102 jobs will be created by this particular project. 

We, like the previous speakers, we also went through a rigorous 

and detailed NTIA due diligence. But our take is a little bit different from everyone else in the sense that, although it was very 

vigorous and they’ve propounded question after question to us, we 

took away the fact that they were very interested in assisting us, 

rather than trying to shoot us down in terms of our project. They 

seemed quite helpful to us—like I said, not taking away from the 

rigorousness of their review—they seemed quite helpful and went 

out of their way, in fact, in our minds, to kind of help us complete 

and provide a very good application. 

So, we’ve actually completed our broadband, our due diligence on 

June 24, and are optimistic and hopeful that this particular project 

will get funded. 

And the other project we have is under the RUS, the BIP project, 

and it’s a East Hawaii Fiber Broadband Project. And this is a ‘‘last 

mile’’ project which would help connect up and serve about 6,100 
51 

households, 54 businesses, and 31 critical community facilities in 

the Pepeekeo Point area, Hawaiian Paradise Park Makai area, Hawaiian Acres, Fern Forest, Royal Hawaiian Estates and Kalapana 

area. This is a $5.4 million project, $3.8 million of it which would 

be funding that we would be requesting, and we would provide the 

balance of the amounts. In this particular project, there are about 

69 jobs that we think would be created by this particular project. 

Now, under the BIP process, there is no due—as we understand 

it—no due diligence so we’re not quite certain as to the status of 

this particular project, in terms of obtaining funding. But again, we 

think that this project is very viable, it’s also very important to the 

Big Island. 

So, in summary, again, we’re very hopeful about both projects, 

and we thank you for your assistance and for your continued support in this area. 

Chairman INOUYE. Thank you very much. 

[The statement follows:] 

PREPARED STATEMENT OF JOHN KOMEIJI

Chairman Inouye and Members of the Senate Appropriations Committee: I am 

John Komeiji, testifying on behalf of Hawaiian Telcom, in support of its Hawaii 

County Community Broadband Upgrade project application, submitted for the 

Broadband Technology Opportunities Program (BTOP), and its East Hawaii Fiber 

Broadband Project application submitted for the Broadband Infrastructure Program 

(BIP), both under the American Recovery and Reinvestment Act of 2009. 

BTOP and BIP were established to award and administer grants to (1) increase 

broadband penetration in underserved areas, (2) improve broadband access to public 

safety agencies, (3) stimulate demand for broadband and (4) spur job creation and 

stimulate long-term economic growth. Both Hawaiian Telcom’s Hawaii County Community Broadband Upgrade project and East Hawaii Fiber Broadband project more 

than meet these objectives. 

PROJECT SUMMARY

Hawaii County Community Broadband Upgrade Project 

This project is a $6.2 million private-public partnership effort between Hawaiian 

Telcom and the County of Hawaii to increase and improve broadband access for residents, businesses and critical community facilities on the Big Island. Of the $6.2 

million, $4.3 million is being requested in grant funds with Hawaiian Telcom funding the $1.9 million balance. The project is projected to benefit approximately 62,450 

households and 4,360 businesses. It will also provide a needed boost to the Big Island economy by creating an estimated 102 new jobs: 19 direct jobs and 83 indirect 

and induced jobs. 

The project includes: 

—Construction of a ‘‘middle mile’’ fiber segment from Pahala to Volcano to complete Hawaiian Telcom’s fiber ring network encircling the Big Island (see Attachment I); 

—Upgrading broadband access points at 22 Central Office telecommunication locations on the Big Island; 

—Extending direct connect fiber facilities to the 9 most critical County-designated 

sites; and 

—Upgrading broadband access at 82 County sites, including 42 Public Safety Entities (Civil Defense, police and fire stations) and 40 Critical Community Facilities that provide essential County services. 

East Hawaii Fiber Broadband Project 

This is a $5.4 million ‘‘last mile’’ project to extend high-speed fiber broadband 

service to 6,180 households, 54 businesses and 31 Critical Community Facilities in 

the underserved rural East Hawaii areas of Pepeekeo Point, Hawaiian Paradise 

Park Makai, Hawaiian Acres, Fern Forest, Royal Hawaiian Estates and Kalapana 

(see Attachment II). Of the $5.4 million, $3.8 million of grant funding is being requested with Hawaiian Telcom funding the $1.6 million balance. Extension of Hawaiian Telcom’s fiber network into these communities will allow them first-time ac-
52 

cess to affordable, reliable broadband services and to various online programs, communications and work-at-home opportunities. Hawaiian Telcom is receiving an increasing number of calls and letters from residents in these communities who are 

frustrated by their lack of access to affordable broadband service and are requesting 

that Hawaiian Telcom extend broadband service to the underserved communities of 

East Hawaii. This project is expected to create 69 jobs: 23 direct jobs and 46 indirect 

and induced jobs. 

NEED FOR BTOP AND BIP PROJECTS

Constructing a network on the Big Island is typically more costly than construction in the more urban parts of the state. The Big Island, with a landmass of approximately 4,028 miles, is more than six times larger than the island of Oahu, but 

has about one-fourtieth, or 2.5 percent of the population of Oahu. While most of the 

island’s population is congregated in Hilo on the east side of the island and Kona 

on the west, the rest of the island consists of highly dispersed rural communities. 

Demographics also show that Hawaii County is an economically distressed county. 

The geography of the island is characterized by dramatic changes in topography, climate, and character across very short distances, and the underlying structure is 

mainly lava rock. The combination of higher construction costs, distances and relatively small customer base does not justify a business case for upgrading and expanding the broadband network, without government funding support. 

At present, residents and businesses of Hawaii County, particularly those in underserved communities, have limited affordable access, if any, to High Speed Internet service (up to 11 Mbps), Enhanced IP Data Service (speeds up to 1 Gbps), Routed Network Services and other advanced applications using network infrastructure 

with wider bandwidths. County facilities are currently limited to a maximum of 1.5 

Mbps. 

BENEFITS TO BIG ISLAND RESIDENTS AND BUSINESSES

Completion of the BTOP Hawaii County Community Broadband Upgrade project 

will have a positive impact on the expansion and accessibility of affordable 

broadband services to most of the Big Island, while completion of the BIP East Hawaii Fiber Broadband Project will provide first-time access to affordable, reliable 

broadband services to the six underserved East Hawaii communities. In particular, 

for the BTOP project: 

—Completion of the fiber ring around the southern half of the island (from Pahala 

to Volcano) will create a ‘‘mesh’’ network that is better able to survive fiber cuts 

than a radial network or a simple ring, by eliminating ‘‘single cut’’ vulnerability 

points. This improves both the reliability and resiliency of the broadband network against the effects of hurricanes, earthquakes, and tsunamis, as well as 

fires and automobile accidents. 

—Upgrading broadband access points at 22 Central Office locations, together with 

completion of the fiber ring will create a network expandable to capacities in 

excess of 800 Gbps that can be accessed at affordable rates by more of the island population. This network upgrade will improve ‘‘last mile’’ services to 

about 62,450 households and 4,360 businesses, with broadband traffic traversing the newly created fiber ring. 

—Extending direct connect fiber facilities to the 9 most critical County-designated 

sites will enable the County to access greater broadband services to improve its 

internal and external communications and data services needs, as well as its 

ability to serve residents and businesses, especially in emergency situations. 

Due to County budget limitations, this type of upgrade would normally take 

many years for the County to justify. 

—Upgrading broadband access at 82 County sites, including 42 Public Safety Entities and 40 Critical County Community Facilities, will improve emergency response times and information sharing on a real time basis between and among 

County agencies and the general public for both small and large scale events, 

as well as improve the reliability of all telecommunication services, including 

critical E–911 service. 

—Improved broadband access and reliability will help create an estimated 102 

jobs (19 direct and 83 indirect) and foster economic development. 

WHY HAWAIIAN TELCOM’S APPLICATIONS SHOULD BE FUNDED

Both the Hawaii County Community Broadband Upgrade project and the East 

Hawaii Fiber Broadband project have numerous community benefits and are the 

most cost effective means of improving broadband services to the largest number of 

current and future broadband customers on the Big Island. This is due to the fact 
53 

that the projects leverage Hawaiian Telcom’s current extensive network infrastructure investments as well as its on-island workforce. 

Hawaiian Telcom owns and operates an existing network that serves most of the 

island through a combination of advanced and legacy systems, microwave facilities 

and non-diverse fiber circuits. Although the projects are designed to expand and improve broadband access, these upgrades will be part of the island-wide network. 

Thus both projects, but especially the Hawaii County Community Broadband Upgrade project, will serve a broader customer base than a stand-alone project and set 

the foundation for both customers and competitors to rely on Hawaiian Telcom’s 

network to meet their communication needs and broadband growth for years to 

come. 

Hawaiian Telcom has the proven expertise to construct and operate communication networks and our experienced workforce, combined with the above projects, will 

ensure a resilient, well maintained network that will be upgraded and grow as the 

Big Island’s demands for broadband grows. However, as indicated previously, without Federal assistance there is no business case to justify the expenditure of funds 

to complete the fiber ring from Pahala to Volcano, make the other improvements 

to the network and to extend broadband service to the six underserved rural East 

Hawaii communities that currently do not have access to wired broadband service. 

Demographics show that Hawaii County is an economically distressed county and 

the Hawaii County Community Broadband Upgrade is the only application that benefits the majority of the Big Island community. Federal assistance from the Recovery Act will allow this project to move forward and allow the residents and businesses to enjoy the benefits of an enhanced broadband network and the improved 

economic development that greater broadband access is expected to create. In addition, Federal assistance for the BIP East Hawaii Fiber Broadband Project will also 

allow Hawaiian Telcom to extend broadband service to the underserved rural East 

Hawaii areas of Pepeekeo Point, Hawaiian Paradise Park Makai, Hawaiian Acres, 

Fern Forest, Royal Hawaiian Estates and Kalapana. 

Hawaiian Telcom respectfully requests your support for both the Hawaii County 

Community Broadband Upgrade project and the East Hawaii Fiber Broadband 

Project which will help realize the broadband benefits and objectives of the Recovery 

Act of 2009. Thank you for the opportunity to testify. 
54 
55 

Chairman INOUYE. I believe that all of you are aware that I 

spent the last 2 days with the Chairman of the FCC, Genachowski, 

and I wanted him to see firsthand and discuss with people the 

problems we have on these seven inhabited islands, mountainous, 

and I must say that he spent every hour doing something. 

Yesterday—the day before yesterday—we were on the Big Island, 

meeting with the mayor and his first responder team to get some 

of the challenges and concerns. Then after that, we met with—we 

went all over the islands, looking at the remoteness, and realizing 

that this is not like Kansas. 

And then we met with Hawaiian community, and Hawaii mayors. We had a wonderful meeting there. We also met with Alaskans 

and Indians—American Indians. Yesterday, we had a luncheon 

meeting, he also went to Queen’s Hospital and saw the effect of 

electronic communications. So, he had a full dose of information. 

And I can assure you that, as a result, we’ll get something, here. 

I’m having a major meeting, not only with him, but with the 

Commission when I get back to Washington, and I hope that we 

can get results. 

So, if I may ask a few questions, on your map, are you getting 

good cooperation from communication providers in Hawaii? 
56 

Mr. SONOBE. I think, generally, they have been very cooperative, 

Senator. 

Chairman INOUYE. In general. 

Mr. SONOBE. The map currently calls for data at the census block 

level. The State feels that for the map to be more informative, that 

the information should really be at the address level. 

So, initially, the NTIA’s requirement was that data to be reported at the address level, and our request initially went out for 

information, as such. There was some hesitance on the part of the 

providers to provide that information. The NTIA then changed 

their requirement to make it a census block reporting requirement, 

and at that point, the providers became more cooperative. So, I 

think—— 

Chairman INOUYE. Because without the data you won’t be able 

to make the map. 

Mr. SONOBE. Right. And again, the point the State would take 

is that for it to be truly informative and useful, that the data 

should be at the address level. 

Chairman INOUYE. When will the map be ready for public viewing? 

Mr. SONOBE. The initial data was sent to the NTIA at the end 

of April. The final map is due in September. 

Chairman INOUYE. Thank you very much. 

Dr. Lassner, yours is a very ambitious program. When are you 

going to have this connection between all of the schools and libraries? 

Dr. LASSNER. If we’re funded, which we haven’t been yet, this 

would—— 

Chairman INOUYE. Assuming you’re funded. 

Dr. LASSNER. Assuming we’re funded, we think it’s about a 2- 

year project. 

Chairman INOUYE. I’ll do my best to get the funding. 

Dr. LASSNER. Thank you. 

Chairman INOUYE. And, how do you propose to connect with the 

mainland? 

Dr. LASSNER. It’s—what we’ve done is, we’ve proposed to buy capacity on one of the new submarine fibers that was just installed 

this year, that comes from southeast Asia, to Guam, to Hawaii, to 

the mainland. And one of the least expensive times to buy capacity 

is when the fiber is new and they still have vacant capacity. So 

we’ve proposed to the National Science Foundation to get the 

money to actually purchase the ownership of a portion of that for— 

it’s called an indefeasible right of use, or IRU, for two 10-gigabit 

per second circuits. Then, in California, we will connect to Los Angeles, and then up to Seattle. 

And then here, from our hub at the University of Hawaii at 

Manoa, we would make that available to all of the community colleges, campuses. If the schools are participating with Internet, too, 

or other things, we’ll work it that way. 

Then from our operating budget, we’ll pay the maintenance on 

that. 

Chairman INOUYE. What will that cost for all of this? 

Dr. LASSNER. That’s about a $10 million project. And that’s in 

process at NSF right now. 
57 

Chairman INOUYE. I think I’ll have my staff call upon you for 

further discussion about this. 

And now, I’m interested in your work with first responders. Are 

we on the right track? 

Ms. SHIN. I think that—I made some statements earlier about 

what we had originally proposed, and what our design ended up 

looking like at the end of our process. We certainly would have 

loved for it to—the network, the public safety network—to have the 

kind of redundancy and resiliency that we had originally designed 

into the network. 

However, we think that this is a tremendous opportunity, and 

again, it will provide sort of that basic infrastructure that the public safety entities can utilize and build upon. 

So, I guess it’s—although it’s not perfect, we are—we’re fairly 

confident that it will help the public safety entities and will improve what they have today. 

Chairman INOUYE. At the present time, our first responders, 

they’re not able to communicate with each other. 

Ms. SHIN. There are many areas in some of these remote spots 

of our, especially over at our neighbor islands, where they are unable to do even basic, push-to-talk radio communications, much less 

broadband, which is what we’re talking about here. 

Chairman INOUYE. It’s no secret that the Asia-Pacific area has 

become an area of major concern to our Nation. It’s no longer the 

Atlantic Ocean, because we think that the potential explosions, if 

it does happen, would be happening in our area. That being the 

case, some of us feel that the military should be tied up with your 

communication system. What do you think about that? 

Ms. SHIN. That’s really the idea that we had when designing this 

network. It was intended to be a fully interoperable network, so 

that in the event of some—either natural or man-made disaster, if, 

say the Federal Emergency Management Agency (FEMA) were to 

have to fly in, or, you know, Homeland Security or whomever, that 

the network would be designed such that there would be—it would 

be relatively easy for all of those public safety entities at all of 

those different levels and jurisdictions to be able to communicate 

with each other fairly effortlessly. 

So, that was the intent of the design of our network, so. 

Chairman INOUYE. I will have my staff get together with you because if we can get the military interested, funding would be very 

simple. 

Ms. SHIN. Thank you. 

Chairman INOUYE. They’re loaded. 

Ms. SHIN. Thank you. 

Chairman INOUYE. Well, Mr. Komeiji? 

Mr. KOMEIJI. Yes, sir. 

Chairman INOUYE. How is chapter 11 going? I—didn’t ask that 

question. 

Mr. KOMEIJI. We’ve cleared the hurdle with the bankruptcy 

court. The bankruptcy court has approved our plan for reorganization and we’re currently awaiting on, I think it was January 4, we 

filed an application with the Public Utility Commission asking that 

they also approve the plan. So, currently, we’re awaiting some decision by the Public Utility Commission regarding the plan. 
58 

The plan itself, I’m sure you know, would reduce our debt by 

about $800 million. 

Chairman INOUYE. I want to be helpful because your organization is a very important element in our civilization here, so—— 

Mr. KOMEIJI. Thank you, sir. 

Chairman INOUYE. If I can be of any help, you let me know. 

Mr. KOMEIJI. Yes, sir. 

Chairman INOUYE. Have you been able to get together with the 

FCC Chairman? 

Mr. KOMEIJI. No, we have not—— 

Chairman INOUYE. I thought that you had met yesterday? 

Mr. KOMEIJI. Yes—no, sir. 

We have a pending application before the FCC dealing with the 

Universal Service Fund, and that’s something that’s very important 

to us. And I think that your visit with the Chairman will help us, 

in terms of attempting to get a waiver. Basically, what we’re seeing 

is, the way the FCC looks at the Universal Service Fund now, it 

considers the State as a whole. So, because Oahu and Honolulu is 

so urbanized, they consider the whole State urbanized. 

So, what we’ve been asking them is to understand that the separate islands are very rural in nature, so that they should break up 

the study areas into smaller groups. 

Chairman INOUYE. I think he was convinced when he took that 

flight. 

Mr. KOMEIJI. Yes. But because of that, I think—because of the 

pending application before them, I think it would put him in a very 

difficult situation to meet with us. So, we understand the reluctance to meet with us on a formal basis. 

Chairman INOUYE. Would you get together with my staff and 

prepare a memo so I can understand your problem—— 

Mr. KOMEIJI. Yes, sir. 

Chairman INOUYE [continuing]. Better? 

Mr. KOMEIJI. Thank you, we will. 

Chairman INOUYE. Well, I’d like to thank the panel for your testimony today; you’ve been very helpful. I’ll do what I can. 

Mr. KOMEIJI. Thank you. 

Chairman INOUYE. The fourth panel consists of the Renewable 

Energy Program Manager of the Hawaii Department of Business 

and Economic Development and Tourism, Ms. Maria Tome; the 

Manager of System Integration, Hawaiian Electric Company, Mr. 

Leon Roose; Vice President and General Manager ULPLSC, Dr. 

James Rekoske; and the Engineering Manager of the Kauai Island 

Utility Cooperative, Mr. Michael Yamane. 

Well, Ms. Tome? 

STATEMENT OF MARIA TOME, RENEWABLE ENERGY PROGRAM MANAGER, STATE ENERGY OFFICE, HAWAII DEPARTMENT OF BUSINESS, ECONOMIC DEVELOPMENT & TOURISM 

Ms. TOME. Good afternoon—yes, good morning, Chairman 

Inouye. Thank you for the opportunity to provide comments on the 

progress of Hawaii’s implementation of energy funding for the 

American Recovery and Reinvestment Act. You have written testimony that’s quite extensive, and I’ll summarize the process that we 

used and the progress that we are making on this. 
59 

The Hawaii State Energy Office, together with other State agencies, administrative offices, and a wide variety of participants from 

the private sector have made great strides in wisely planning and 

spending Recovery Act formula funding for energy in the State of 

Hawaii. The current energy transformation began in 2006 with 

Governor Lingle’s Energy for Tomorrow Initiative. We identified 

both short- and long-term changes needed for success. We realized 

that outside help was needed to provide the expertise, confidence, 

and activation energy to spark the transformation. 

So in 2008, the Hawaii Clean Energy Initiative (HCEI) was 

launched in partnership with the U.S. Department of Energy. Its 

goal is a 70 percent clean energy economy by 2030. This requires 

transforming the regulatory and policy framework, as well as 

changing many of the business models that had implied fossil energy generation, transmission, delivery, and use. 

Through the HCEI process, the Hawaii Clean Energy Initiative 

process, we brought together many of the public sector partners 

and private industries that are now involved in our energy transformation. Recovery Act energy funding provides Hawaii a timely 

downpayment for reinvestment in our energy future. 

We were able to bring the Recovery Act funds into plans that had 

already been developed for the HCEI, and to expand and accelerate 

the start of important projects. Once the plans were set, a number 

of months were spent working alongside the Department of Energy 

through the challenges well known to many, the National Environmental Policy Act (NEPA), Buy American, Davis-Bacon and other 

issues not foreseen in the spring 2009. 

Additionally, the State of Hawaii has endured significant budget 

pressures, reductions in force and furloughs, which were necessary 

under the circumstances, but made for a challenging environment 

in which to move rapidly. After receiving final guidance from the 

U.S. DOE in December 2009, our team set to finalizing the agreements and obligating the funds. In an adverse environment, our 

team has met every goal which the U.S. DOE has set, including 

just last week, the goal of 85 percent obligation of State energy program funds by June 30, 2010. 

So Recovery Act funding has been a tremendous catalyst to fueling energy transformation, especially in a period when financial resources have been constrained, both in the State and private sector 

budgets. The time spent in 2009 aligning the spend plan to both 

long-term transformation and short-term recovery objectives has 

been shown this year to have been time well spent. 

Several great examples of the impact of Recovery Act energy 

funds in Hawaii may be found in our written testimony. If we have 

time I’d like to highlight one example. The appliance rebate program was announced at a press conference on May 13 and officially 

launched on May 24, 2010. If offered consumers a $250 rebate to 

trade in an older inefficient refrigerator and replace it with a new 

ENERGY STAR refrigerator. The old refrigerator was hauled away 

and delivered to a recycler. New ENERGY STAR qualified refrigerators employ 50 percent less energy than ones made just 10 

years ago, so replacing a single 10-year-old refrigerator can save island residents between $1,700 and $2,000 over its 15-year lifespan. 

The rebate was available for a total of 4,356 refrigerators state-
60 

wide, and nearly 4,000 were sold on the very first day. Please note 

that while $1.2 million of stimulus funding was committed directly 

to consumers under the program and the merchandise has moved, 

the U.S. DOE has been invoiced for less than $100,000 due to the 

lag times in these—these types of programs. 

Likewise, for other projects described in the written testimony, 

funding is obligated, hiring is in progress, and work is underway. 

So Recovery Act energy funds are being spent at an opportune 

time. While the pain of high oil prices is still being felt, displaced 

workers are excited about new energy opportunities, and the images of the gulf oil spill remind us of the importance and urgency 

of developing our alternatives. 

Hawaii’s success in achieving and exceeding the HCEI goal of 70 

percent clean energy will not only attain energy security, independence, and economic vitality for the State and its residents, but will 

serve as a model of energy system transformation for other States, 

regions, and nations. 

Thank you for your support of Hawaii’s energy transformation 

and for the opportunity to testify. 

Chairman INOUYE. Thank you very much. 

Ms. TOME. Thank you. 

[The statement follows:] 

PREPARED STATEMENT OF MARIA TOME

The State Energy Office of the State of Hawaii Department of Business, Economic 

Development, and Tourism (DBEDT) appreciates the opportunity to submit testimony, with input from the U.S. Department of Energy (USDOE), to the Committee. 

This statement will cover the Hawaii portions of the energy formula grants under 

the American Recovery and Reinvestment Act of 2009 (ARRA) as well as input from 

the USDOE regarding competitively awarded projects to be deployed in the State 

of Hawaii. 

This submission is organized into the following sections: Hawaii’s Total Energy 

Formula Funding under the Recovery Act (ARRA); Strategic Approach for Building 

the Expenditure Plan; Formula Funding Expenditure Project Plan and Status; and 

U.S. Department of Energy Competitive Grants in Hawaii. 

HAWAII’S TOTAL ENERGY FORMULA FUNDING UNDER ARRA

State Energy Program (SEP) DE–FOA–0000052—$25.93 million. 

Energy Efficiency and Conservation Block Grants (EECBG) DE–FOA–0000013— 

$15.1 million total ($9.6 million to State; $5.5 million to Counties). 

State Energy Efficient Appliance Rebate Program (SEEARP) DE–FOA–0000119— 

$1.236 million 

Weatherization Assistance Program (WAP) Formula Grants DE–FOA–0000051— 

$4.04 million. 

Energy Assurance Programs: 

—Enhancing State Government Energy Assurance Capabilities and Planning for 

Smart Grid Resiliency DE–FOA–0000091—$318,000. 

—State Electricity Regulators Assistance Funding DE–FOA–0000100—$782,000. 

Total Formula Funding $47.38 million 

The purposes of ARRA energy funding are ‘‘[T]o preserve and create jobs and promote economic recovery; to assist those most impacted by the recession; to provide 

investments needed to increase economic efficiency by spurring technological advances in science and health; to invest in transportation, environmental protection, 

and other infrastructure that will provide long-term economic benefits; and, to stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.’’ 

ARRA—State Energy Program (SEP) 

Goals: The existing goals of the long-standing State Energy Program (SEP) are 

to: 
61 

—Increase energy efficiency to reduce energy costs and consumption for consumers, businesses and government; 

—Reduce reliance on imported energy; 

—Improve the reliability of electricity and fuel supply and the delivery of energy 

services; and 

—Reduce the impacts of energy production and use on the environment. 

The goals of the additional ARRA funds allocated to the SEP are to: 

—Stimulate the creation or increased retention of jobs; 

—Save energy (kWH/therms/gallons/BTUs/etc.); 

—Increase energy generation from renewable sources; and 

—Reduce greenhouse gas emissions. 

ARRA—Energy Efficiency and Conservation Block Grants (EECBG) 

Purpose: The purpose of the EECBG program is to assist eligible entities in creating and implementing strategies to achieve the following: 

—Reduce fossil fuel emissions in a manner that is environmentally sustainable 

and, to the maximum extent practicable, maximize benefits for local and regional communities; 

—Reduce the total energy use of the eligible entities; and 

—Improve energy efficiency in the building sector, the transportation sector, and 

other appropriate sectors. 

ARRA—State Energy Efficient Appliance Rebate Program (SEEARP) 

Purpose: The Appliance Rebate Program Objectives are: 

—Save energy by encouraging appliance replacement through consumer rebates. 

—Make rebates available to consumers. 

—Enhance existing rebate programs by leveraging ENERGY STAR national partner relationships and local program infrastructure. 

—Keep administrative costs low while adhering to monitoring and evaluation requirements. 

—Promote state and national tracking and accountability. 

—Use existing ENERGY STAR consumer education and outreach materials. 

ARRA—Weatherization Assistance Program Formula Grants 

Purpose: The Weatherization Assistance Program (WAP) objective is to increase 

the energy efficiency of dwellings owned or occupied by low-income persons, reduce 

their total residential expenditures, and improve their health and safety. The WAP 

priority population is persons who are particularly vulnerable such as the elderly, 

persons with disabilities, families with children, high residential energy users, and 

households with high energy burdens. 

ARRA—Enhancing State Government Energy Assurance Capabilities and Planning 

for Smart Grid Resiliency (DE–FOA–0000091) 

Purpose: The following activities shall be addressed when structuring projects 

under this funding opportunity: 

—Create in-house expertise at the State level on energy assurance planning and 

resiliency, focusing on Smart Grid. 

—Develop new, or refine existing, Energy Assurance Plans to incorporate response 

actions to new energy portfolios, including Smart Grid technologies. 

—Revise appropriate State policies, procedures and practices to reflect the Energy 

Assurance Plans. 

—Develop and initiate a process or mechanism for tracking the duration, response, restoration, and recovery time of energy supply disruption events. 

—Train appropriate personnel on energy infrastructure and supply systems and 

the content and execution of energy assurance plans. 

—Conduct energy emergency exercises (intra and interstate) to evaluate the effectiveness of the energy assurance plans. 

ARRA—State Electricity Regulators Assistance Funding (DE–FOA–0000100) 

Purpose: ARRA funding for electricity sector activities and initiatives will significantly affect utility investment in the electric power sector. State Public Utility 

Commissions (PUCs) will be involved in implementing key facets of ARRA electricity-related initiatives. To ensure that PUCs can meet the demands caused by the 

increased workload required to fully address the electricity sector initiatives included in the ARRA, the USDOE made funding available to PUCs to hire additional 

staff so they can ensure appropriate technical expertise will be dedicated to regulatory activities pertaining to ARRA electricity-related initiatives. The intent of the 

funds made available through the ARRA State Electricity Regulators Assistance Initiative is to supplement, not supplant, normal state appropriations for PUC staffing, 
62 

expressly for the purpose of addressing the significant increase in PUC workload 

created by ARRA electricity-related initiatives. 

STRATEGIC APPROACH FOR BUILDING THE EXPENDITURE PLAN

In January 2008, the State of Hawaii, in partnership with the U.S. Department 

of Energy (DOE), announced the Hawaii Clean Energy Initiative (HCEI), which sets 

an ambitious goal of moving Hawaii to 70 percent clean energy by 2030. Analysis 

and planning to achieve this 70 percent clean energy objective has been underway 

for the last 30 months. This HCEI objective is the overarching policy and implementation framework for planning the expenditure of ARRA’s energy funding. The goal 

in utilizing ARRA energy funding is to catalyze significant progress in many of the 

components of HCEI. Achieving this alignment was accomplished through the efforts of many HCEI partners and stakeholders. 

Hawaii’s ARRA funding expenditure plan was developed after broad consultation 

to ensure that it supplemented HCEI and other related initiatives already underway. Specific attention was paid to the DOE’s and national laboratories’ annual operating plans to ensure that the state’s spending plan complemented but did not duplicate intended Federal expenditures. 

Beginning in February and continuing through July 2009, meetings were held 

with energy sector stakeholders to discuss priorities and to build awareness of the 

spending plans. The plan also received input and guidance from HCEI Working 

Groups’ recommendations and from HCEI partner projects. Potential technical support from the national laboratories was also factored in. Central to this planning 

effort was focus on augmenting programs and processes already in place in order 

to speed deployment of the funds into the market. In April, a meeting of Hawaii’s 

key energy community members and agencies which are funding energy projects 

was held to construct a ‘‘landscape’’ of existing initiatives into which ARRA funding 

could be deployed. Briefings were provided by the Department of Defense, the University of Hawaii, the Pacific International Center for High Technology Research, 

electric and gas utilities, and state agencies such as the Department of Accounting 

and General Services and the Department of Hawaiian Home Lands, among others. 

The existing goals and budgets of these agencies were taken into consideration 

when drafting the ARRA plan in order to avoid redundant efforts. 

The objective has been to create a plan which integrates multiple Hawaii energy 

sectors, each of which has multiple formula funding sources. Planning and analysis 

focused on identifying opportunities to enhance projects which fit Hawaii’s strategic 

plan, which have a sound basis and rationale, and which can be implemented quickly to obtain measurable results. 

The complexity of Hawaii’s energy system and programs makes a comprehensive 

effort challenging, but a thoughtful and inclusive approach, as undertaken in developing this plan, is essential to its success. 

ARRA has been a tremendous catalyst to fueling energy transformation, especially 

in a period when financial resources have been constrained both in the state and 

private sector budgets. The time spent in 2009 aligning the spend plan to both long 

term transformation and short term recovery objectives has been shown this year 

to have been time well spent. 

FORMULA FUNDING PROJECT EXPENDITURE PLAN AND STATUS

Formula funding project spending plan summary: 

—SEP—Energy Efficiency Programs—$7,990,280 

—SEP—Electric Power and Renewable Programs—$9,663,425 

—SEP—Transportation Programs—$5,292,357 

—SEP—Clean Energy Policy—$780,227 

—SEP—Communication and Outreach—$1,084,000 

—SEP—Administration—$1,119,711 

—EECBG—State Portion—$9,593,500 

—SEEARP—Energy Efficient Appliance Rebate—$1,235,985 

—Energy Assurance Programs—$1,100,000 

State Energy Program (SEP) ARRA Grant—$25,930,000 

The State Energy Program is managed by the Department of Business, Economic 

Development, and Tourism (DBEDT). The Director of DBEDT is the State Energy 

Resources Coordinator. Within DBEDT is the Strategic Industries Division, which 

functions as the Hawaii State Energy Office. 

Significant deliverables under this Recovery Act grant include: Energy Efficiency 

Programs; Electric Power and Renewable Energy Programs; Transportation Energy 

Programs; Education and Outreach; and Clean Energy Policy. 
63 

1http://hawaii.gov/dbedt/info/energy/efficiency/bbg/indexlhtml. 

The expenditure of ARRA funds has focused on wisely using these resources to 

target strategic market interventions that can cause permanent structural change; 

identify opportunities for better integration of initiatives for technology deployment 

and market transformation; and promote collaboration across public and private 

agencies. 

These market interventions are expected to provide energy savings and renewable 

energy generation as follows per market area: 

—Buildings: 49,000 MBtus 

—Electric Power & Renewable Energy: 4,023,000 MBtus 

—Transportation: 37,000 MBtus 

We have met the USDOE’s goal of 85 percent of SEP funding being obligated by 

June 30, 2010, and are on track to meet the goal of 100 percent obligation prior 

to September 30, 2010. 

SEP—Energy Efficiency Programs 

Energy efficiency programs provide quick economic stimulus through employing 

local construction industry personnel in projects to retrofit existing buildings or to 

install energy-efficient equipment. Reduced energy costs are realized quickly and 

the savings can be directed to growth, investment, and employment. 

High Performance Buildings Program—$800,000 

The goal of this program is to accelerate adoption of highly energy-efficient buildings. Buildings account for 72 percent of electricity consumed in the United States, 

produce 38 percent of all carbon dioxide emissions, 40 percent of raw materials use, 

30 percent of waste output (136 million tons annually), and 14 percent of potable 

water consumption. The strategy will include providing technical assistance and 

training to building owners, developers, design professionals, and county building 

code officials to ensure that new and renovated buildings are designed and built 

with high efficiency and do not compromise our energy future. We are bringing 

buildings to Energy Star and Leadership in Energy and Environmental Design 

(LEED) standards. 

The U.S. Environmental Protection Agency established an Energy Star buildings 

program which allows building owners and managers to ‘‘benchmark’’ or identify energy use per square foot, compare building performance to a national standard, and 

to receive certification of the energy efficiency of their buildings. Energy Star buildings are in the top 25 percent of building performance. Our goal is to ensure that 

as many buildings meet the Energy Star standard and make improvements to meet 

Energy Star standards. 

Our strategy also includes building design and operations to meet a higher and 

more robust efficient building standard which has international recognition, provides third party verification for performance, and is included in the Governor’s Administrative Directive 06–01 to state agencies. This standard is Leadership in Energy and Environmental Design. Buildings built or renovated to LEED (Silver 

Standard) are generally 30 percent more energy efficient. 

Support updating and adoption of a higher efficiency building code. The State of 

Hawaii has adopted the International Energy Conservation Code (IECC) of 2006; we 

are targeting adoption of IECC 2009 by the end of this year. 

Funds for these projects are 90 percent obligated. Approximately 10 percent of the 

work has been completed. Two contracts have been executed with kick off meetings 

planned for July. The third contract has been awarded and will be executed this 

quarter. 

The 10th Annual Build and Buy Green Conference 1 was completed in May; it featured 42 speakers and 47 exhibitors and attracted 350 attendees. 

Government & Residential Energy Efficiency Programs—$6,865,280 

The residential efficiency program supports the U.S. Department of Energy’s 

Weatherization Assistance Program (WAP), which services qualified low-income 

households. Our funds will expand the WAP program measures by providing education, audits, and the installation of high efficiency residential appliances. 

($500,000) 

A project with the Public Utilities Commission supports activities of the Public 

Benefits Fee program, expanding and accelerating the energy savings significantly 

for electric utility customers on Oahu, Maui, Molokai, Lanai, and Hawaii islands. 

($6,165,280) 

A project with the Kauai Island Utility Cooperative expands and accelerates the 

energy savings for electric utility customers on Kauai. ($200,000) 
64 

We initiated the very popular statewide rebate program for replacement refrigerators which, in combination with ARRA-State Energy Program and the ARRAState Energy Efficiency Appliance Rebate Program, resulted in about 8,000 Energy 

Star refrigerators purchased in 1 month. 

Funds for these projects are 100 percent obligated; work has begun and is approximately 15 percent completed. 

Hospitality Sector Energy Efficiency Program—$325,000 

The strategy for this program is to develop an assessment to attract financing for 

a sea water air conditioning chilled water loop for Waikiki hotels. The Greening of 

Waikiki provides a stronger marketing edge and operating/economic efficiencies for 

a major Hawaii attraction. A Waikiki Roundtable event bringing together major 

Waikiki hotel managers and engineers to present the program has galvanized hotel 

interest. Our analysis shows that there are already six Energy Star hotels and over 

4 million square feet of hotel rooms and grounds that meet Energy Star. A sea 

water air conditioning project would make Waikiki a first in the nation. 

Project has been expanded to include hotels statewide and a contractor for Energy 

Star benchmarking and verification has been selected per state procurement requirements. A kickoff meeting will be scheduled very shortly. 

Funds for this project are 40 percent obligated. Work has begun, and is approximately 5 percent complete. 

SEP—Electric Power and Renewable Energy 

Electric Power and Renewable Energy programs attract investment to transform 

Hawaii’s energy system to be less reliant on petroleum (and less vulnerable to oil 

price shocks) and more reliant on locally-available energy sources with more stable 

costs. Attracting investment to Hawaii can assist with its economic recovery, while 

reinvesting in Hawaii’s electricity and fuel generation and distribution systems for 

improved economic stability. 

Renewable Energy Program Support 

To meet at least 40 percent of Hawaii’s energy needs with renewable sources 

(solar, wind, wave, OTEC, geothermal, hydropower, and bioenergy) by 2030, as required by State statute, multiple successful projects—properly sited, cost-effective, 

publicly accepted, effectively permitted, and interconnected—will be needed. 

Support will be provided to tip major projects currently in the pipeline toward accelerated completion; assist with identifying and completing project permitting requirements in an efficient and effective manner; facilitate communication with renewable energy project developers, landowners, investors, environmental groups, the 

public, and others; enable interconnection, conversion, and storage of renewable energy; document project success and lessons learned; provide information, guidance, 

and case studies to other project developers and the public; and facilitate the transfer of credible and current information on the long term costs, benefits, and realistic 

assessments of technologies from and to Hawaii’s residents, decision-makers, landowners, media, and the public. 

To accomplish this work, positions have been created; staff has been hired; and 

work is proceeding on solar energy support; wind energy support; renewable energy 

resource assessment, data analysis, and technology assessments of wave, ocean 

thermal energy conversion, geothermal, hydropower, bioenergy, and energy storage; 

collaborative efforts with Federal, State, and County agencies; and providing information and meeting with project developers, researchers, land owners, teachers, students, and the general public on renewable energy issues and opportunities. 

Additional renewable energy support projects include: 

e-Permitting Portal—$375,000.—In this project, an on-line permitting service is 

created for all Hawaii State Department of Health (DOH) permits and regulatory 

approvals required for renewable energy projects. Users will be able to create individual permit files and track the processing status of their permit applications. 

The funds have been 100 percent obligated following finalization of the contract 

on May 25, 2010. DBEDT, DOH, and Windsor Solutions—the contractor retained to 

conduct the technical work—have scheduled project kick-off meetings the entire 

week of July 19, 2010. Windsor has already begun work on this project. Permitting Guidebooks and Online Information—$150,000.—Funds for this project 

will be used to complete the Hawaii-specific renewable energy permitting guidebooks for each of the main renewable energy technologies and for each of the Counties. The contractor will provide an overview of Federal, state, and county permitting requirements and enable access to the permitting guidebooks on-line. In addition to providing links to the permitting and approving agencies, users will be able 

to create individual project files, or ‘‘permit plans,’’ to identify the necessary permits 

and estimate project development timelines. 
65 

The solicitation for this contract is being finalized and will be released soon. Work 

is scheduled to begin in September, 2010. 

Energy Storage Project to Demonstrate Renewable Energy Support Technologies— $1,800,000.—Energy storage is expected to play a critical role in helping Hawaii reduce its dependence on the use of fossil fuels; provide support for intermittent energy sources; and increase the use of renewable energy. Energy storage could help 

to diversify Hawaii’s energy sources and improve price predictability, stability, and 

energy security for Hawaii’s electric utilities and energy consumers. 

This project will demonstrate the use of energy storage on the electrical grid to 

provide grid stability and support, to ‘‘tip’’ intermittent energy projects from concept 

into reality by the development of technical solutions to interconnection concerns. 

Funds will be used to support the purchase and installation of two energy storage 

systems at locations on the Maui Electric Company (MECO) and Hawaii Electric 

Light Company (HELCO) grids with high penetrations of renewable distributed generation. 

The installation of commercially-available energy storage systems on these grids 

will improve understanding of the use of energy storage to increase the penetration 

of renewable energy on Hawaii’s electrical grids, ultimately leading to an increased 

ability of the electrical distribution systems to accept higher levels of renewable distributed generation such as wind and solar and the attraction of private sector investment in renewable and energy storage systems. 

With adequate levels of dispatchable energy storage, higher penetration of intermittent resources, such as photovoltaics, will be achievable; grid resiliency and reliability will be improved; and additional renewable energy investments can be expected. 

We are working with the utility to refine the scope of the project, and will seek 

input from the national laboratories on technical aspects of the energy storage system specifications. The funds are to be fully obligated by the end of July. 

Support for Interisland Cable 

The interisland cable has been identified as an essential component of Hawaii’s 

energy future. An interisland cable would increase access to renewable energy 

projects statewide, which could lead to consumer and business cost savings, as well 

as improved energy security and grid resiliency. 

One of the important benefits that could be realized with an inter-island cable is 

better use of the excellent wind energy resources which are available in certain 

areas of Hawaii. Wind energy is one of the lowest cost of the proven and mature 

utility—scale renewable energy technologies. 

Although Hawaii’s power grids are not yet interconnected, there are several interisland telecommunications cables already interconnecting the islands. Undersea 

power cables are in use in other states and countries. ARRA funding will support 

initial studies, environmental surveys, and other non-construction aspects of interisland cable development. Specific projects include: 

Cable Special Deputy Attorney General—$200,000.—This contract will aid the 

State of Hawaii in the development of the interisland cable by advising on legal, 

regulatory, business, financing, and strategic decisions. This funding will reduce 

risk for the State and consumer, and shorten the timeline for getting the undersea 

cable in place. 

Funds are 100 percent obligated; contract has been executed; work has begun. 

Cable Subject Matter Expert—$500,000.—This contract will aid the State of Hawaii in the development of the interisland cable by providing advice based on experience in development of undersea power transmission cables. This funding will reduce risk for the State and consumer, and shorten the timeline for getting the undersea cable in place. 

Funds are 100 percent obligated; contract has been executed; work has begun. 

Request for Information—$50,000.—This project enabled the State of Hawaii and 

the Hawaiian Electric Company (HECO) to collect information regarding the financing and development of the interisland cable via a cable developers’ conference. The 

results of the RFI will be used in the Request for Proposals (RFP) for the interisland 

cable. This will directly reduce ambiguity and cost for the cable. 

Funds are 100 percent obligated; contract has been executed; work is substantially complete. 

Technical Assistance for Cable Interconnection—$500,000.—This project will provide expertise and assistance on technical and interconnection aspects of the interisland cable project. This funding will reduce the risks for the State, consumers, and 

potential project developers, and reduce the project and financing costs by providing 

independent information on technical alternatives. 

These funds are expected to be obligated in August. 
66 

Interisland Cable Environmental Impact Statement (EIS)—$2,997,947.—This contract will provide required environmental review documentation to satisfy the requirements of the National Environmental Policy Act (NEPA) and the Hawaii Environmental Policy Act (HEPA) for both a programmatic EIS for the Interisland Wind 

project and also project-specific environmental analyses for the Interisland Cable 

based on the alternatives selected. As part of the EIS, the consultant team will examine impacts on cultural resources; historic and archeological resources; socioeconomic impacts; coastal aquatic ecology; endangered, threatened and protected 

species; coral reef ecology; whales and marine mammals; wildlife and fisheries biology; water quality; ecological and human health; offshore habitats; essential fish 

habitats; visual impacts; preferred routing alternatives; and other issues. The EIS 

work will also include rigorous public involvement on the affected islands through 

a comprehensive public outreach and participation process. 

Funds are 100 percent obligated; contract has been executed; work has begun. 

Undersea Cable Ocean Floor Surveys—$300,000.—This project conducts ocean 

floor surveys for the proposed deep water undersea cable route south of Oahu, collecting side-scan sonar data, high resolution near-bottom bathymetry data, and subbottom sonar data, accurately positioned with a short baseline acoustic navigation 

system. A website disseminates the data from the surveys and provides access to 

maps, features, images and video. 

Funds are 100 percent obligated; contract has been executed; work is largely complete. 

SEP—Transportation Energy Transformation Program 

This project plans and implements actions to transform Hawaii’s transportation 

energy supplies from 95 percent petroleum-based liquid fuels to a variety of locallyavailable energy sources including renewable electricity and biofuels. The transportation energy diversification project will ready Hawaii for significant deployment of 

electric drive vehicles and other advanced transportation energy technologies, as 

well as the development of locally produced fuels. 

To accomplish this work, positions have been created; staff has been hired; and 

work is proceeding on vehicles; fuels; agri-bioenergy assessments; collaborative efforts with Federal, State, and County agencies; and providing information and meeting with project developers, researchers, land owners, teachers, students, and the 

general public on transportation energy, vehicle, and fuel-related issues. Additional 

transportation energy support projects include: 

Hawaii EV Ready Program—$4,024,780 

This program provides grants and rebates for the installation of electric vehicle 

chargers and the purchase of new, commercially-available full-speed electric motor 

vehicles. Result: 1,000–5,000 electric vehicle chargers installed and 200–600 electric 

vehicle purchases supported by grant and rebate funds. Funds for this project are 100 percent obligated. $1,024,780 has been allocated for the rebate program; $3,000,000 is available for grants. The allocation between 

grants rebates may be adjusted based on the needs of the market in this highly dynamic time for electric and other advanced technology vehicles. 

The Grant Opportunity Announcement, released on June 9, 2010, invites grant 

applications from Hawai‘i businesses, nonprofit organizations, and State and county 

government entities to support the installation of commercially available and standard-compliant electric vehicle (EV) charging equipment and to accelerate the adoption of full-speed electric motor vehicles in Hawai‘i. The application due date is July 

26, 2010, 11 AM Hawaii Time. Selected projects are to be announced August 31, 

2010. 

The Hawai‘i EV Ready Rebate Program, scheduled to begin in August of 2010, 

will provide rebates for Hawaii residents, businesses, State and County agencies, 

and nonprofit entities for the initial purchase of new, commercially available electric 

vehicles for use in Hawaii and for the purchase and installation of commercially 

available charging equipment in Hawaii. 

More information and documents are available at http://electricvehicle.hawaii.gov. 

State Fleet Program—$475,500 

This program supports State infrastructure and vehicle fleet demonstrations and 

transformation, providing funds for vehicles and infrastructure. Result: deployment 

of electric vehicles in State fleets and installation of charge stations in State owned 

facilities. 

Funds for this project are 100 percent obligated. The Department of Accounting 

and General Services (DAGS) operates the Hawaii State motor pool and will be 

using the funds to acquire electric, plug-in hybrid electric, advanced technology, or 

alternative fuel vehicles and to install electric vehicle chargers. DAGS will assist 
67 

2http://www.capitol.hawaii.gov/hrscurrent/Vol05lCh0261–0319/HRS0291/HRSl0291– 

0071.htm. 

Hawaii State government agencies to lead by example through acquisition of electric 

or plug-in hybrid electric vehicles and to comply with statutory requirements for 

electric vehicle parking at state facilities, including parking lots, in accordance with 

Act 156, Session Laws of Hawaii 2009.2

Transportation Energy Transformation Strategy—$60,000 

This project includes public input and participation in vehicle, fuel, and food 

project development via websites, e-mails, personal communication, presentations, 

and reports; collecting data and documenting success; and developing, directing, and 

participating in collaborative bioenergy, integrated agricultural and energy analysis, 

and food-and-fuel development tasks. 

In addition to the work described above, DBEDT is participating as a member of 

the Center for Bio Energy Research and Development (CBERD), established in September 2008 with an award from the National Science Foundation through the Industry/University Cooperative Research Center program. The University of Hawaii 

was selected as one of five participating university sites along with the South Dakota School of Mines and Technology; Kansas State University; State University of 

New York at Stony Brook; and North Carolina State University. Second year funding was received in September 2009. CBERD provides a valuable service for the 

identification of solutions and provides a forum for understanding of Hawaii’s 

unique bioenergy crop, by-product, and scale needs. The Center will focus on aspects 

of life cycle analysis—from raw material acquisition through production, use, endof-life treatment, recycling, and disposal—of bioenergy feedstocks. The goal of the 

current projects are (1) to conduct a net energy analysis of a plantation-scale Eucalyptus production system, and (2) to identify the carbon and greenhouse gas implications of utilizing existing Eucalyptus trees for bioenergy production. Activities by 

the Center support and extend recent advances made by industrial partners. On 

June 8, 2010, the State Energy Office signed a contract to contribute $20,000 annually for three years in support of the Center. 

Funds for this project are 100 percent obligated. 

Clean Energy Policy—$780,227 

This project supports, coordinates, facilitates, engages, and participates in Hawaii 

Clean Energy Initiative activities, programs, and plan development to ensure the 

achievement of the Clean Energy Goal of transforming Hawaii to a clean energy 

economy consistent with the State’s energy goals and policies provided under Section 226–18, Hawaii Revised Statutes. 

Funds for this project are 100 percent obligated. Work has commenced and is proceeding at an accelerated pace. We are on track to complete the work needed and 

fully expend the funds. 

SEP—Education and Outreach 

Communications—$500,000 

Provide information to the public, decision-makers, the media, investors, project 

developers, private sector, nonprofit, government entities about Hawaii’s progress in 

renewable energy and energy efficiency programs, policies, goals, economic development opportunities; provide information on the use of energy-efficient and renewable energy technologies including solar, wind, hydropower, wave energy, ocean 

thermal energy, geothermal, interisland cable, transportation, electric vehicles, fuel 

cells, building efficiency, and energy conservation; encourage input and provide information on energy policies and planning (FiT, decoupling, etc.); and provide information on energy project financing and funding. Provide information to the media 

(i.e., radio, television, print interviews, news segments/articles, news conferences, 

special events, etc.); local, national and international energy industry representatives; property owners; business, community, government, military, and other stakeholders; and the general public. Provide website content and updates for consumers, 

businesses, government, military, community and education sectors. 

Funds for this project are not obligated at this time as we are going through the 

procurement process and anticipate a contract being signed in August 2010. 

Energy Conference Services—$160,000 

Under a UH Conference Center contract, the State will provide technical assistance, training, and public education activities to encourage the use of energy-efficient and renewable energy technologies. In order to maximize grass-roots and business support, we will work with UH Conference Center to assist with conferences, 
68 

workshops, and/or meeting logistical needs such as registration, speaker coordination, audio visual, etc. As part of the State’s business-to-business goal, Hawaii must 

continue to showcase energy projects and programs in order to stimulate job growth 

and economic development opportunities. 

Funds for this project are 100 percent obligated; contract signed on June 15, 2010. 

SEP—Administration 

Administration of the State Energy Program ARRA funds includes Program oversight, coordination, management, procurement, contracting, accounting, and reporting in accordance with Federal and State requirements. 

Funds for this task are 100 percent obligated. Work has commenced and is proceeding at an accelerated pace. We are on track to complete the work needed and 

fully expend the funds. 

EECBG—Energy Efficiency and Conservation Block Grant—$9,593,500 

DHHL Homestead Energy Program—$2,900,000 

The Department of Hawaiian Home Lands (DHHL) is partnering with DLIR Office of Community Services in assisting DHHL homestead communities. The project 

covers 400 homestead homes and will be conducted over a period of 18 months. Included are conducting home energy audits and assessments; delivering energy efficiency and conservation education/training; and retrofitting/installing homes with 

solar water heating systems and energy-efficient lighting. 

Funds are 100 percent obligated. Contracts are in place; work has begun. 

Department of Accounting and General Services (DAGS): ‘‘PV on State Buildings’’—$2,970,000 

Funds will be used for the installation of photovoltaic (PV) systems as a demonstration and educational project involving a renewable energy technology that will 

reduce State consumption of electrical power generated with fossil fuels. The DAGS 

goal is to achieve 40 percent reduction in energy consumption for State office buildings under its management and control. 

Funds are 100 percent obligated. Contract is in place; work will begin at the end 

of July, 2010. 

KIUC Customer Energy Efficiency Project Augmentation—$200,000 

These funds are allocated to KIUC through DBEDT to offer the customer energy 

efficiency rebate programs for government and nonprofit buildings on Kauai. These 

funds are in addition to the $200,000 KIUC customer energy efficiency project. 

Funds are 100 percent obligated; contract is in place; work will begin soon. 

DBEDT Innovative Clean Energy Financing—$2,922,928 

The innovative clean energy financing initiatives support public adoption of energy technologies by overcoming market barriers; i.e. up-front economic costs and 

risks, through financing mechanisms such as Property Assessed Clean Energy and 

Loan Loss Reserve Fund. 

The ‘‘Property Assessed Clean Energy’’ (PACE) program is a local government 

(County) level retrofit financing program providing property owners with a more desirable retrofit capital option than otherwise available. In addition to leading to a 

significant number of energy saving retrofits, this activity will serve as a model for 

future retrofit financing programs throughout the state. The participating Counties 

will be chosen based on interest and willingness to accelerate program implementation and desire to continue operating the program into the future. Funds provide 

initial capital for the program to enable financing of retrofits to an estimated 110 

homes; the program is intended to enable the participating Counties to attract private capital for subsequent retrofit cycles. Using the DBEDT ‘‘I–O Model Type 2 

(2010)’’ multiplier, this grant will generate $1.3 million in direct, indirect and induced income to Hawaii’s economy, and 23 job-years over the grant duration. 

The ‘‘Loan Loss Reserve Fund’’ will be used to expand the capital available to 

fund building retrofits and energy improvements across all building segments by 

creating and funding a loan loss reserve fund. This will provide support for the large 

market for energy efficiency and renewable energy loans that banks have been slow 

to respond. This will leverage private investment. Moreover, by mitigating the risk 

associated with these loans, Hawaii will help borrowers gain access to lower cost 

capital than would be possible without the reserve leading to more attractive interest rates for the supported loan products. Once banks have sufficient data to confidently assess the risks associated with energy efficiency and renewable energy 

loans, they can develop underwriting criteria for determining the associated risk 

and resulting pricing. 
69 

DBEDT EECBG Administration—$600,268 

Funds have been allocated to two administrative positions and miscellaneous expenses to assist with the administration of the EECBG funds. 

SEEARP—State Energy Efficient Appliance Rebate Program—$1,236,000 

The Hawai‘i Energy Efficient (Energy Star) Appliance Rebate Program, marketed 

as ‘‘Trade Up for Cool Cash’’ and ‘‘Replace, Recycle, Save,’’ was a riveting success 

statewide. The program, which was announced at a press conference on May 13, 

2010, and officially launched on May 24, 2010, targeted the replacement of older, 

inefficient refrigerators with qualified Energy Star rated appliances by offering consumers a $250 rebate. Consumers were required to trade-in their older operating 

refrigerator, preferably their oldest one, which was then hauled away and delivered 

to a recycler. The Public Utilities Commission-Public Benefits Fee Administrator, 

Hawaii Energy, managed the appliance rebate program for the Counties of Honolulu, Maui, and Hawai‘i, while Kauai Island Utility Cooperative (KIUC) handled the 

rebates for Kaua‘i County. 

The rebate was available for a total of 4,356 refrigerators statewide, and nearly 

4,000 were sold on the very first day. An additional 4,000 rebates for Energy Star 

refrigerators, following SEEARP criteria, were made available through another 

source of ARRA funding, on all islands except Kauai. Retailers saw a large increase 

in business, along with their delivery divisions and the recycling companies, but the 

actual level of job creation is unknown. KIUC’s informal poll of the retailers, delivery companies, and recycling company on Kauai concluded that there wasn’t enough 

sustained activity to create additional jobs, since their program only lasted 5 days. 

Hawaii Energy budgeted for personnel costs but has not yet reported on jobs created. 

Participating retailers played an important part of the program by assisting consumers wanting to participate in the program and in helping them obtain their rebates. These retailers pledged to provide delivery of the new refrigerator and haul 

away and properly recycle the old refrigerator, making them a ‘‘one stop shop’’ for 

the rebate program. 

Sears is a good example of what retailers did to boost their sales and promotions. 

The stores opened early on the start date of the program, offered free coffee and 

pastries to the early-shoppers, and implemented efficient processes to assist customers. Consumers seemed to echo a general feeling that the program provided 

them with an opportunity to get rid of their old refrigerator—something many had 

been putting off for some time. Customers who purchased a new refrigerator are 

also taking a step toward helping Hawaii reduce its dependence on oil and fossil 

fuel; and, they’re going to be saving money that can go toward other necessities. 

With such a high level of consumer interest, the program is certain to run through 

its available rebate applications soon. 

The tremendous response to the appliance rebate program is largely due to media 

interest and heavy coverage. A total of 27 articles were written in print/online 

media including the Honolulu Advertiser, the Honolulu Star-Bulletin, The Garden 

Island, Maui News, Hawai‘i Tribune Herald, Pacific Business News, and Business 

Week. Additionally, the program was covered by 17 broadcast television/radio segments, which include KHON2, KITV4, KHNL8, KGMB9, KHPR, and KSSK. 

Cooperation and consensus among the State, Hawaii Energy, and KIUC were the 

keys to accomplishing a program not only benefitting our economy and the environment, but also incentivizing consumers to move sooner rather than later. The underlying goal for this program was to involve everyone, State program managers, the 

two implementers, consumers, retailers, distributors, haulers, recyclers, print media, 

television, and radio stations. We wanted to help consumers statewide take full advantage of these funds. As we designed this program, we looked at all the issues 

at hand, but we never forgot about making the process simple enough for qualified 

consumers to take advantage of the program, while allowing our implementers to 

effectively control the roll-out. As a result of this cooperative effort, up-front marketing costs of the statewide program were reduced, allowing more of the Federal 

funds to be spent for rebates. 

Funds for this project are 100 percent obligated. We will be invoiced shortly and 

funds will be expended soon. 

Energy Assurance Formula Grants 

This program is intended to increase expertise in regulatory and energy assurance 

issues related to smart grid and to increase training and staff capability with new 

technology. Specific projects are: 
70 

State Electricity Regulators Assistance Funding—$782,000 

This funding will be used to improve the State Public Utility Commission’s 

(PUC’s) ability to gain the expertise required to handle increasingly complex issues 

associated with Smart Grid technology and the associated regulatory issues. The 

SERAF program aims to ensure that PUCs can meet the increased demands caused 

by the increased workloads through the hiring of additional staff. This goes to ensure appropriate technical expertise will be dedicated to regulatory activities pertaining to Recovery Act electricity-related initiatives. The Hawaii PUC was received 

its award notification in November 2009. 

Enhancing State Government Energy Assurance Capabilities and Planning for Smart Grid Resiliency—$318,000 

This funding is to create expertise at the State level on energy assurance planning 

and resiliency, focusing on Smart Grid; support development of energy assurance 

planning and plans; train personnel on execution of energy assurance plans; and 

fund energy emergency exercises to evaluate the effectiveness of the energy assurance plans. Hawaii’s Energy Assurance proposal was submitted on July 27, 2009. 

The awards have been awarded and received. 

The Request for Proposals for the contract under this project was released July 

1, 2010. In-house work has begun on the project and we are on track to meet program goals, objectives, and timelines. 

USDOE RECOVERY ACT PROJECTS

The Recovery Act supports the Department of Energy’s diverse research and development (R&D) portfolio, while weatherizing homes, funding Energy Efficiency 

and Conservation Block Grants (EECBG), and funding the State Energy Program. 

The latter three investments are making homes, businesses, and towns across the 

Nation more energy efficient, saving Americans money on their energy bills. Formula grants awarded to Counties under the EECBG program are listed below. In 

addition to Recovery Act Section 1603 grants in lieu of tax credits, DOE is working 

with the Department of the Treasury to formulate another program to issue grants 

in lieu of tax credits for qualified renewable energy projects. Lastly, the Recovery 

Act expanded the fund for the DOE Loan Guarantee Program to support commercial 

applications of qualified technologies. 

County Block Grants—$5,474,700 

The Energy Efficiency and Conservation Block Grant Program touches communities throughout the United States, highlighting the importance of sustainability 

at the county and municipal levels. With approval from DOE, the State of Hawaii’s 

EECBG plans at the County level are complete and projects are under development, 

putting Americans to work and helping move Hawaii toward a clean energy economy. The following four counties highlight some of the EECBG projects Hawaii has 

underway. 

—City and County of Honolulu—$3,863,700.—The six projects include four lighting improvement projects and two solar photovoltaic (PV) system facility installations. These projects have not started as yet. A possible seventh project is 

being discussed with USDOE. 

—Hawaii County—$737,800.—Of the six projects overall, three relate to green retrofits and public education; the funds have been encumbered and the consultants selected. One project addresses financing for energy efficiency and renewable energy; a contract has been issued for this project. One project seeks to improve government operations with respect to sustainability; a contract for this 

project has been issued. Lastly, a street light retrofit project is still pending. 

—Maui County—$605,300.—The 13 total projects include 12 for energy audits followed by solar PV system installations and one project for feasibility of a wasteto-energy facility. Maui County has encumbered $25,000 related to the energy 

audit projects. 

—Kauai County—$267,900.—To install a solar PV system at a fire station. Phase 

I is a $25,000 plan and design phase. Phase II will solicit for the build phase. 

Currently, Kauai County is awaiting a tax clearance prior to a notice to proceed 

to the company selected to do the Phase I work. 

Recovery Act Competitive Grants 

The Office of Energy Efficiency and Renewable Energy and the Office of Electricity and Energy Reliability both supported various competitive grant solicitations 

related to priority objectives of DOE programs. Several Hawaii-based projects were 

selected from numerous responses to Funding Opportunity Announcements. These 

projects include funding of: 
71 

3http://www.ustreas.gov/recovery/1603.shtml. 

—$25,000,000 awarded to UOP for pilot and demonstration scale biorefineries; 

—$5,500,000 awarded to the Kauai Island Utility Cooperative Smart Grid project; 

—$5,300,000 awarded to the Hawaiian Electric Company Oahu Smart Grid 

project; 

—$3,000,000 awarded to Phycal for innovative concepts for beneficial reuse of carbon dioxide; 

—$2,500,000 awarded to the University of Hawaii to develop a new cross-disciplinary program focused on areas of clean energy technologies, renewable energy 

production, storage, integration, and smart grid technologies; 

—$750,000 awarded to HECO for wind energy technology R&D and testing; and 

—$750,000 awarded to Pacific Center for Advanced Technology Training (University of Hawaii Community Colleges) to develop and enhance a career pathway 

for technicians that will deploy and maintain electric power transmission and 

distribution through the application of smart grid technologies. 

Hawaii Section 1603 DOE/Treasury Grants 

As of July 2, 2010, grants have been awarded to 20 statewide projects, totaling 

more than $9.4 million.3 These projects include 15 solar electric projects, four solar 

thermal projects, and one fuel cell project. The grants in-lieu of tax credits program 

was developed as an alternative to investment tax credits (ITC) and production tax 

credits (PTC) renewable energy developers received over the last two decades. The 

erosion of profits of large lending institutions around 2008, eliminated the opportunity to effectively employ the tax credits. The new, Section 1603 grants created 

by the Recovery Act provided an alternative to ITC and PTC for renewable energy 

developers. Projects in Hawaii are among about 800 awarded across the Nation 

spurring private sector investment in renewable energy projects. 

Loan Guarantee for First Wind 

DOE’s Loan Guarantee Program issued a conditional commitment for a loan guarantee to First Wind Holdings, LLC for the construction of a 30 megawatt wind energy facility to be located in the Kahuku area of Oahu. A formal ground breaking 

ceremony is scheduled for this facility on July 13, 2010. Construction will continue 

throughout the summer and fall of 2010. If the project is commissioned before January 1, 2011 this it would also be eligible for a Section 1603 grant. 

Chairman INOUYE. Mr. Roose. 

STATEMENT OF LEON ROOSE, MANAGER, SYSTEMS INTEGRATION, HAWAIIAN ELECTRIC COMPANY 

Mr. ROOSE. Thank you, Mr. Chairman. 

I’d like to first express Hawaiian Electric’s appreciation for this 

opportunity to testify and share with you what we’ve been doing 

with our funds and awards we’ve received. You know, we’re very 

grateful to have been a recipient of approximately $8.5 million in 

funds for three projects, three ARRA projects. I’m going to talk 

about each of them a little bit here. 

First project is the one in which we received the largest funding, 

and that was $5 million, and it’s called our East Oahu Switching 

Project. This project is essentially designed to utilize new smart 

grid switching technology on the HECO system, very cutting edge 

application. It really offers us an opportunity to use a very innovative approach, which will in effect reduce outage time for many of 

our customers when we have events on our system. It can reduce 

outage times from hours to minutes, it will significantly lower the 

implementation costs of the project, which—by roughly about 50 

percent based on how we were previously going to do it and how 

we plan to do it today with the smart grid switching technology. 

It’s going to reduce community impacts, so now we don’t have to 

dig up many streets to put in new lines and infrastructure, again 

deploying technology as a solution. It will enable the acquisition of 
72 

key new skill sets for our utility staff as we move into this future 

of a more smarter and resilient system. 

In particular, this project will create or retain more than 20 jobs 

on the utility front, and also adds resources from contractors during the planning and implementation stages. It also offers a significant opportunity for HECO to retrain its workforce, again in smart 

technology solutions. And we really believe that the lessons learned 

and results from this effort can be utilized to establish, you know, 

hardware communication, logic foundations for many mainland 

utilities and applications of a similar manner throughout the country. So I think will really show as a showcase for those kinds of 

projects. 

Another project that we did receive some ARRA funding for was in the amount of $750,000, and was what we called our Wind 

Grant. That money was awarded by DOE wind program. We actually got that money back on July 14, 2009. That effort will fund 

sort of three components, and all three of those are well underway 

at this point. We’re going to be putting out some fairly cutting edge 

technology to actually forecast the way wind farms and solar, you 

know, facilities will actually move around as the wind drops off or 

picks up and the Sun, you know, the amount of solar radiation that 

is picked up by solar panels changes as clouds move over. 

This is a fairly significant issue for utilities in general across the 

country. And as we increase our penetration of these resources on 

our system, our ability to effectively operate in that environment 

is critical. And so the creation of tools like this are really essential 

for our future operation and keep pushing forward our ability to 

take on more of this kind of energy. 

The second part of the initiative is we’re—we’re in the process of 

developing a roadmap for our smart grid future for our utilities. 

That work is pretty winding up at this point, and we’re putting together a documentation of that roadmap. And again, that’s a critical element, as that will really establish our foundation as we look 

forward, not just in the near-term activities, but how they link over 

the long-term with our initiatives. 

And the third area, we’re going to be gathering a lot of data from 

existing facilities that are out there in the field and pulling that 

data back and giving it to our operators in ways in which they can 

make good operational decisions. That’s another key, sort of, R&D 

effort, but is crucial as we look forward into the future of our operations. 

The third full grant is one that we got very recently, and this 

was one we worked in conjunction with the University of Hawaii, 

and it is one we’re very proud of. We’ve got $2.5 million there, and 

really a lot of the focus of that money will be to rebuild the curriculum at the University of Hawaii in the Engineering College and 

beyond that, but in particular in the Engineering College, in the 

Electrical Engineering Division or department in the area of 

power—power systems. As a former alumni of the university and 

having gone to school there, you know, at one time we did have 

that curriculum at the university. Today it no longer exists. And 

so this money and initiative is a key part of seeding the restoration 

of a program at the university to train our future engineers who 

are going to be vital to us as we move forward into the future in 
73 

the power industry and the kind of work that we do at Hawaii 

Electric. 

So again, we find this to be very important, we’re working close 

with the university, we’re also providing a lot of staff support. One 

of the—one of my directors on my staff is going to be serving as 

an adjunct professor at the university, teaching many of the 

courses and doing lectures. And they’ve actually started already 

this year. It’s been very good. Again, this money will help take that 

to the next level and we can build upon that. 

I appreciate the opportunity to testify today and I’d be happy to 

answer any questions. Thank you. 

Chairman INOUYE. Thank you very much. 

[The statement follows:] 

PREPARED STATEMENT OF LEON ROOSE

Chairman Inouye and Members of the Committee: My name is Leon Roose and 

I am the Manager of System Integration at Hawaiian Electric Company (HECO). 

Thank you very much for the opportunity to brief you in person on the status of 

Hawaiian Electric Company’s projects that have received Federal stimulus funding 

under the American Recovery and Reinvestment Act (ARRA). HECO is grateful to 

have been a recipient of these funds as the projects they are funding are helping 

us to progress towards our clean energy future at a quicker pace. 

FOA 58—East Oahu Switching Project (approx. $5 million) 

The East Oahu Switching Project is designed to utilize new smart grid switching 

technology on the HECO system as a means to reliably and timely restore service 

to customers after an outage event. In effect, it will intelligently automate high load 

distribution lines in urban Honolulu. The project offers an innovative approach 

which will reduce outage times from hours to minutes, lower implementation costs 

by up to 50 percent and reduce community impacts in comparison to the traditional 

approach of building new distribution lines, improve safety, and enable acquisition 

of new skill sets and tools for utility staff. 

The new technology to be installed on the HECO grid will address these smart 

grid characteristics: 

—Optimizing asset utilization and operating efficiency of the electric power system. HECO’s approach is specifically focused on moving from HECO’s distribution grid design of ‘‘overbuild for capacity and reliability’’ paradigm to one of 

‘‘capacity extension and reliability improvement through monitoring, control, 

and automation’’. 

—Anticipating and responding to system disturbances by using feeder automation, 

installing intelligent substation controllers, automated switches, and reclosers 

to quickly isolate and restore power. This includes advanced control center grid 

visualization, intelligent information analysis/filtering, and tools for ‘‘predictive 

avoidance’’ of operational problems. 

—Operating resiliently to attacks in the area of cyber security by applying NIST 

interoperability and cyber security frameworks to the communication backbone 

used in this project. 

The project will secure existing utility ‘‘green’’ jobs and adds resources from contractors during the planning and implementation stages. It also offers a significant 

opportunity for HECO to retrain its workforce in smart technology solutions. The 

project exemplifies a significant step in the staged evolution to a smart grid and provides a clear demonstration in support of national smart grid deployment efforts. 

The lessons learned and results from this effort can be used to establish hardware, 

communication and logic foundations for mainland utilities and technology vendors 

throughout the country. 

ARRA Wind Grant ($750,000) 

The initiatives funded under this $750,000 ARRA grant are well underway with 

various subcontractors engaged in deploying remote sensing equipment (i.e. sodar 

and lidar) to pilot a real-time ramp event forecasting effort. Three initiatives were 

funded, all supporting utility focused effort to increase the ability to accommodate 

more variable renewable technologies such as wind on our island grids. 

The first initiative, WindNET as it is called, is supported by AWS TruePower and 

mainland utilities, SCE, BPA, PG&E and CaISO, all having previously been funded 
74 

under Department of Energy (DOE) wind forecasting initiatives known as 

WindSENSE. 

In the second initiative a Smart Grid roadmap is to be completed for the family 

of Hawaiian Electric Companies (HECO/MECO/HELCO). The development of this 

roadmap is critical to enabling the effective investment of capital in new smart electrical infrastructure tailored to the needs of the island utility grids. Results and recommendations arising from this initiative which will inform further coordinated 

work and implementation of smart grid infrastructure. 

The third initiative is the integration of grid monitoring and resource data into 

the operational environment. Hawaii’s Big Island utility, HELCO, is leading the piloting of solar, grid based monitoring and visualization capability into the operations 

environment. Initial pilot efforts will inform the development of refined and tailored 

pilots and deployment activities funded for HECO and MECO. 

FOA 152—University of Hawaii/HECO Workforce Development ($2.5 million) 

HECO is teaming up with the University of Hawaii (UH) under FOA 152, a $2.5 

million workforce development initiative, to initiate responsive and dynamic training programs to develop the existing workforce on clean energy alternatives and improve the workforce pipeline in all sectors from tourism, business, and manufacturing to the Department of Defense. The partnership will leverage industry staff 

to help train our next generation on energy reliability and provide education and 

training opportunities to support the education and development of the existing 

workforce. Through this funding, UH will support reestablishing their power engineering curriculum, internship programs with industry, and broaden educational opportunities to help inform the public. HECO staff will offer support in various initiatives as presenters, adjunct faculty and active feedback to the UH program. 

FOA 313—Informing Smart Distributed Management System RD&D Initiatives 

(approx. $8.8 million) 

HECO just recently submitted its proposal for this 5 year grant. We expect to 

hear if we have been awarded this grant in the Fall of 2010. As part of this proposal, a multi-disciplinary team of participants including the family of Hawaiian 

Electric Companies (HECO/MECO/HELCO), Sacramento Municipal Utility District 

(SMUD), Siemens, BEW Engineering, GL, PowerWorld, University of Hawaii, SAIC, 

Honeywell, CPower, and Akuacom, has been formed with the goals of supporting 

utilities in accelerating adoption of reliable transformational technologies and facilitating appropriate consumer behavior modeling and design of capabilities needed to 

bring an integrated distributed management system (DMS) into operation. We are 

also looking to support diverse demand-side management (DSM) and consumer energy conservation and efficiency (EC&E) programs. 

Three utility focused initiatives, which link together development of accurate distributed resource models and integration capability, design of smarter consumer 

loads, and demonstration to build user confidence in smart technologies, form the 

basis of this DMS proposal. The three initiatives include: 

Initiative 1—Enhancing Grid Capabilities to Model, Visualize and Control Distributed Resources.—Develop commercially reliable distributed modeling tools and capability to effectively monitor, update, and incorporate a broad spectrum of data (e.g. 

system, resource and customer) for distributed resources management. 

Initiative 2—Engaging Smart Loads.—Build in grid specific customer usage and 

desired load control characteristics into transmission and distribution planning process, new DMS and DSM energy efficiency programs. 

Initiative 3—Building Operational Confidence.—Involve users in a utility-level 

pilot to demonstrate distributed resource control for grid management utilizing developed models and tools. 

The objectives of these initiatives include: 

—Developing and integrating into commercially available, utility-based transmission and distribution tools, accurate algorithms for modeling distributed 

technologies (e.g. inverter-based) and capturing desired attributes (individual or 

aggregated response) for smart grid operations. 

—Evaluating and quantifying appropriate customer usage characteristics and 

large sector (tourism, residential, military) behavior attributes into utility system models to inform requirements for grid responsive DMS and design of new 

DSM/EE programs. 

—Conducting Sensitivity of Response Analysis (SRA) using new aggregation models to help quantify the level of accuracy and control needed to improve operator 

confidence in use of DMS for grid operations. 

—Developing appropriate pilot implementation of developed models and tools with 

at least 6 months of demonstration data. 
75 

—Gather ‘‘lessons-learned’’ to inform new processes/procedures to best integrate 

smart technologies for DMS while building operational confidence that improves 

grid response and reliability. 

Thank you again for providing this opportunity to update the Committee on Hawaiian Electric Company’s use of Federal stimulus funds through the American Recovery and Reinvestment Act. I will be happy to answer any questions you may 

have. 

Chairman INOUYE. Dr. Rekoske. 

STATEMENT OF JIM REKOSKE, VICE PRESIDENT AND GENERAL MANAGER, RENEWABLE ENERGY AND CHEMICALS, HONEYWELL UOP 

Dr. REKOSKE. Mr. Chairman, thank you for allowing me the opportunity to appear before you today in your beautiful State. My 

name is Jim Rekoske, and I’m the Vice President and General 

Manager for Renewable Energy and Chemicals at Honeywell’s UOP 

business. It is an honor for me to be here in Hawaii to discuss the 

Integrated Biorefinery Project in Kapolei. This exciting project is 

the result of funding made available by the United States Department of Energy under the American Recovery and Reinvestment 

Act of 2009. 

Honeywell proudly supported the American Recovery and Reinvestment Act because we believed it would stimulate the economy 

and provide jobs through innovative projects like our project in 

Kapolei. The Department of Energy has funded the construction of 

a pilot scale production unit that will use local sources in the production of renewable transportation fuels. This project supports efforts to improve United States energy security and reduce greenhouse gas emissions. It will also help grow the U.S. sustainable 

biofuels industry, create jobs both in Hawaii and throughout the 

country. 

The Integrated Biorefinery project in Kapolei is led by Honeywell’s UOP business, a global leader in the development and licensing of technologies for the production of fuels and chemicals. Today, 

60 percent of the world’s gasoline and 85 percent of the world’s biodegradable detergents are made using technology invented and developed at UOP. 

Honeywell’s capabilities, however, are much broader and include 

technologies and solutions that are helping to solve many of the 

world’s toughest challenges, such as safety, security, energy generation, efficiency, production, and comfort. Nearly 50 percent of 

Honeywell’s current product portfolio delivers energy efficiency 

benefits. If immediately and comprehensively adopted today, these 

products could reduce the country’s energy usage by 20 to 25 percent. 

Throughout its history, UOP has played an important role in 

every major step change in fuel production. Our commitment to 

and investment in renewable fuels is no different. In 2006, driven 

by growing concerns over energy security, rising greenhouse gas 

emissions and the volatility of fuel prices, we began to focus on developing profitable and efficient methods for the conversion of natural oils and wastes to usable fuels. 

Our technologies enable the conversion of natural oils, energy 

crops, and wastes into real fuels that perform as well as, or better 

than, their petroleum counterparts. These fuels work as drop-in replacements, meaning they can be used without modification to to-
76 

day’s established infrastructure, including refineries, storage, delivery, and engine technology. 

The advantages of these fuels have been proven in a number of 

ways. Honeywell green diesel has been used to power automobiles 

currently available for commercial use. Honeywell green jet fuel, as 

a 50 percent blend with kerosene, has powered four commercial airlines in demonstration flights, and was most recently used for test 

flights with the U.S. Air Force and the Navy F/A–18 Green Hornet. 

In each case, Honeywell renewable fuels met or exceeded existing 

specifications for petroleum products. 

Our technologies are designed to be feedstock flexible to allow 

use of a wide range of sustainable natural oils including algae, 

camelina, animal fats and more. These are nonfood feed stocks that 

do not use land or water currently set aside for food crops. Over 

the lifecycle of the products, these feed stocks have the potential 

to reduce greenhouse gas emissions as much as 80 percent compared with fuels made from crude oil. 

The Kapolei facility will demonstrate the scalability of technology 

that converts biomass into a liquid biofuel known as pyrolysis oil 

and then upgrades this oil to produce green transportation fuels. 

Honeywell and its partners will evaluate the fuels produced and 

perform life cycle analysis of the process to fully understand the 

environmental implications. 

A key element to this project is the potential for job creation. 

Honeywell has hired local firms to support the permit activities 

and environmental studies needed for construction of the facility. 

The construction will utilize local labor and stimulate additional 

jobs throughout the country, as 80 percent of the materials required will be sourced from within the United States. In addition, 

Honeywell plans to employ local labor to run the day-to-day operations of the facility. 

Beyond plant support, there is significant potential for new jobs 

in the agricultural sector. The site will process a wide range of 

local feed stocks, including Guinea grass, sugar cane bagasse, algal 

residues, sorghum by-products, eucalyptus and more. Anticipating 

long-term success, Honeywell intends to deploy the technology mastered here on a commercial scale. When deployed commercially, 

each site would enable the production of up to 50 million gallons 

of renewable fuel annually, and require approximately 800 construction workers to build and 1,000 production workers to operate 

the value chain. 

Validation of the technology in Kapolei will enable commercialscale biofuel production throughout the United States using sustainable feed stocks suited to each region’s environment and economy. We are confident that the success of this facility will mean 

future green jobs for the American workforce. 

Thank you for your time today. We see tremendous momentum 

as a result of your support and I commend your interest and dedication to these valuable projects. 

Chairman INOUYE. Thank you very much, Doctor. 

[The statement follows:] 
77 

PREPARED STATEMENT OF JIM REKOSKE

Senator Inouye, thank you for allowing me the opportunity to appear before you 

today in your beautiful state. My name is Jim Rekoske, and I am the Vice President 

and General Manager for Renewable Energy and Chemicals at Honeywell’s UOP 

business. It is an honor for me to be here in Hawaii to discuss the Integrated Biorefinery Project in Kapolei. This exciting project is the result of funding made available by the United States Department of Energy under the American Recovery and 

Reinvestment Act of 2009. 

Honeywell proudly supported the American Recovery and Reinvestment Act because we believed it would stimulate the economy and provide jobs through innovative projects like our project in Kapolei. The Department of Energy has funded the 

construction of a pilot scale production unit that will use local sources in the production of renewable transportation fuels. This project supports efforts to improve 

United States energy security and reduce greenhouse gas emissions. It will also help 

grow the U.S. sustainable biofuels industry and create jobs both in Hawaii and 

throughout the country. 

The Integrated Biorefinery project in Kapolei is lead by Honeywell’s UOP business, a global leader in the development and licensing of technologies for the production of fuels and chemicals. Today, 60 percent of the world’s gasoline and 85 percent of the world’s biodegradable detergents are made using technology developed 

by UOP. Honeywell’s capabilities, however, are much broader and include technologies and solutions that are helping to solve many of the world’s toughest challenges, such as safety, security, energy generation, efficiency, productivity, and comfort. Nearly 50 percent of Honeywell’s current product portfolio delivers energy efficiency benefits. If immediately and comprehensively adopted today these products 

could reduce the country’s energy use by 20 to 25 percent. 

Throughout its history, UOP has played an important role in every major step 

change in fuel production. Our commitment to and investment in renewable fuels 

is no different. In 2006, driven by growing concerns over energy security, rising 

greenhouse gas emissions and the volatility of fuel prices, we began to focus on developing profitable and efficient methods for the conversion of natural oils and 

wastes to usable fuels. 

Our technologies enable the conversion of natural oils, energy crops, and wastes 

into real fuels that perform as well as, or better than, their petroleum counterparts. 

These fuels work as drop-in replacements meaning they can be used without modification to today’s established infrastructure including refineries, storage, delivery, 

and engine technology. 

The advantages of these fuels have been proven in a number of ways. Honeywell 

Green DieselTM has been used to power automobiles currently available for commercial use. Honeywell Green Jet FuelTM, as a 50 percent blend with kerosene, has 

powered four commercial airlines in demonstration flights, and was most recently 

used for test flights with the U.S. Air Force and the Navy F/A–18 Green Hornet. 

In each case, Honeywell renewable fuels met or exceeded existing specifications for 

petroleum products. 

Our technologies are designed to be feedstock flexible to allow used of a wide 

range of sustainable natural oils including algae, camelina, animal fats and more. 

These are non-food feedstocks that do not use land or water currently set aside for 

food crops. Over the lifecycle of the products, these feedstocks have the potential to 

reduce greenhouse gas emissions as much as 80 percent compared with fuels made 

from crude. 

The Kapolei facility will demonstrate the scalability of technology that converts 

biomass into a liquid biofuel known as pyrolysis oil and then upgrades this oil to 

produce green transportation fuels. Honeywell and its partners will evaluate the 

fuels produced and perform life cycle analysis of the process to fully understand the 

environmental implications. 

A key element to this project is the potential for job creation. Honeywell has hired 

local firms to support the permit activities and environmental studies needed for 

construction of the facility. The construction will utilize local labor and stimulate 

additional jobs throughout the country as 80 percent of the materials required will 

be sourced from the United States. In addition, Honeywell plans to employ local 

labor to run the day-to-day operations of the facility. 

Beyond plant support, there is significant potential for new jobs in the agricultural sector. The site will process a wide range of local feedstocks including Guinea 

grass, sugar cane bagasse, algal residues, sorghum by-products, eucalyptus and 

more. 

Anticipating long-term success, Honeywell intends to deploy the technology mastered here on a commercial scale. When deployed, each commercial site would en-
78 

able the production of up to 50 million gallons of renewable fuel annually, and require approximately 800 construction workers to build and 1,000 production workers 

to operate. 

Validation of the technology in Kapolei will help enable commercial-scale biofuel 

production throughout the United States using sustainable feedstocks suited to each 

region’s environment and economy. We are confident that the success of this facility 

will mean future green jobs for the American workforce. 

Thank you for your time today. We have seen tremendous momentum as a result 

of your support, and I commend your interest and dedication to these valuable 

projects. 

Chairman INOUYE. Mr. Yamane. 

STATEMENT OF MICHAEL V. YAMANE, P.E., MANAGER, ENGINEERING, 

KAUAI ISLAND UTILITY COOPERATIVE 

Mr. YAMANE. Thank you, Mr. Chair. I’m Mike Yumane on behalf 

of Kauai Island Utility Cooperative (KIUC). You have my written 

testimony before you, I would just like to briefly highlight some key 

points. 

In July 2009, along with a consortium of 26 electric co-ops in 11 

States, KIUC applied for the Department of Energy’s Smart Grid 

demonstration project. The DOE awarded the project total cost of 

$67 million in December 2009. The cost of KIUC’s project is $11 

million, of which $5.5 million is being provided by ARRA funds. 

The project will involve replacing approximately 33,000 meters 

with smart meters along with communication infrastructures that 

will allow two-way communication between the meter. KIUC anticipates procurement of materials at the end of July 2010, and installation of 33,000 smart meters shortly thereafter. The installation of 

these meters will take approximately 2 years and involved approximately 40,000 man-hours of local electrical labor on Kauai. 

During this process KIUC relied heavily on the National Rural 

Electric Co-op and the Cooperative Research Network (CRN) to 

meet DOE requirements for procurement, installation, and reporting. KIUC is a small company with limited resources and expertise 

in this area and fully appreciates the support by the National 

Rural Electric Cooperative Association (NRECA). 

KIUC would also like to express its sincere gratitude to the Senator for your letter of support to the Department of Energy for 

KIUC on this matter. 

Thank you for the opportunity to testify. 

[The statement follows:] 

PREPARED STATEMENT OF MICHAEL V. YAMANE

Thank you for the opportunity to testify on Kauai Island Utility Cooperative 

(KIUC) Smart Grid Initiative funded by the American Recovery and Reinvestment 

Act (ARRA) funds. My name is Michael Yamane, Engineering Manager for KIUC. 

In July 2009, KIUC along with a consortium of 26 electric cooperatives in 11 

states, and the National Rural Electric Cooperative Association’s (NRECA) research 

arm, the Cooperative Research Network (CRN) applied for the Department of Energy’s (DOE) Smart Grid Demonstrations, Enhanced Demand Side and Distribution 

System Management Project (DE–FOA–0000036). 

The DOE awarded NRECA’s CRN half of the project’s total cost of $67 million 

in December 2009 to test and develop technologies that operate together to make 

the grid more efficient and reliable. 

The cost of KIUC’s project is $11 million, of which $5.5 million is being provided 

by ARRA funds. The project will involve replacing approximately 33,000 meters 

with smart meters along with communications infrastructure that will allow twoway communication between the meter and KIUC. This Advanced Metering Infrastructure (AMI) will enable KIUC not only to do meter readings remotely, but also 
79 

allow KIUC to demonstrate the effectiveness of load control and demand response 

options within households, outage management and detection down to the household 

level, and evaluate different rate designs depending on usage. 

The demonstration project, which includes replacing existing meters with new 

smart meters at members’ homes and installing communications infrastructure, will 

assess smart grid effectiveness, and is estimated to last 5 years; 2 years for installation and 3 years for data gathering and analysis. 

The replacement meter is a communication device that communicates via wireless 

or Power Line Carrier (PLC) system and sends information back to our substations. 

The communications between our substations and KIUC will use existing fiber optics, Synchronis Optical Network (SONET), to transmit that information back to our 

office. 

KIUC anticipates procurement of materials at the end of July 2010 and installation of 33,000 smart meters shortly thereafter. The installation of these meters will 

take 2 years and involve approximately 40,000 man-hours of local electrical labor. 

Installation of associated hardware and software will be occurring concurrently 

along with the remaining communication infrastructure. 

During this process KIUC relied heavily, and will continue to rely heavily on 

NRECA and CRN to meet DOE requirements for procurement, installation, and reporting. KIUC is a small company with limited resources and expertise in this area 

and fully appreciates the support by NRECA. 

KIUC would also like to express its sincere gratitude for the Senator’s letter of 

support for KIUC on this matter. 

Thank you for the opportunity to testify. 

Chairman INOUYE. Thank you. 

As all of us are aware, we pay more for fossil fuel than people 

in other States. But in a sense it’s been a boon to us, because we 

have been literally forced to get into alternative sources. And, one 

of the dream projects we have is this cable, transmission cable. But 

before we can fund that, I think it’s obvious that we must be able 

to prove that the wind energy and solar energy sources are available, that the use can be made and all of them are connected. 

What stage are we in now? 

Mr. ROOSE. For that project effort, we have been—and I’ve been 

responsible for the study efforts at Hawaiian toward that end. 

We’ve just completed and wrapped up about 11⁄2 years of intensive 

technical engineering work to assess and determine how will we integrate that magnitude of wind and operate the system reliably 

and effectively, to look at the various types of cable configurations 

that would make the most sense in that interconnect. 

You know, that work is basically wrapped up. We’ve done it with 

incredible support from the Federal Government through the National Renewable Energy Lab, of the funded, you know, the creation of what we call the technical review committee. We brought 

in the best and the brightest from around the world, literally, to 

sit on this committee, and we’ve had six meetings through that 

year now to process those studies to help guide, advise, vet the 

work that was going on. And I think the work product that came 

out of that is really leading edge, I think it’s something, you know, 

we’re writing papers on it and many things. 

But, I think through that effort we have figured out how to integrate, how to make it operate. It’s going to require investment, not 

just in the cable but in other things too, because it fundamentally 

will change the way the system operates. 

Chairman INOUYE. Is the military a major partner? 

Mr. ROOSE. At this point in time, I think the military’s role has 

been in discussions regarding the potential of cable landing sites on 
80 

the bases, but those are among the various alternative sites that 

are being examined. 

Chairman INOUYE. I think you should seriously consider them 

and consider Kaneohe and places like that for a landing site, because if the military is fully committed, funding could be a bit easier. 

Mr. ROOSE. I see. Yes, and we’ve been having many meetings 

with them and there will be many more for sure, and I’ll take your 

advice very well. 

Chairman INOUYE. Is the State satisfied that all the plots are 

being all in place? 

Ms. TOME. Yes, we are very happy at the new amount of collaboration and cooperation that we’re seeing with National Labs coming in and working together to identify the technical issues and 

find solutions. They’ve been very, very helpful and the utility has 

been very cooperative on the development of the energy agreement 

in October 2008. That was a great step forward, and we’re looking 

forward to continue to work with them on the policy side as well 

as the technical side and the financial side and get it all together. 

Because the continued dependence on oil is an alternative that 

puts us at great risk. And it’s nice to see that pretty much everybody is on the same page on that. 

Chairman INOUYE. Hawaii is ready because we are the first, I 

think, of the military to use electric buses. We were the first to consider alternative motion terminal energy conversion. And biofuel, I 

think we’re too early in that, as a result the company went bankrupt, but we’re trying. 

We are very interested in your Kapolei project. When will that 

be finished? 

Dr. REKOSKE. Construction begins in September of this year, and 

we will have completion of the project and operations should be at 

the end of 2011. So, first operation should be December 2011 or no 

later than January 1, 2012. 

Chairman INOUYE. And you’ll have all in this say, ingredients for 

your operation here in Hawaii? 

Dr. REKOSKE. Yes we will, that’s the intent. The facility will be 

contained here in Hawaii, it will be operated by people here in Hawaii, and the raw materials, some of which will be sourced out of 

Hawaii for conversion, the biomass conversion, but the majority of 

it will be sourced here from Hawaii. 

Chairman INOUYE. This Kapolei project, how much will it cost? 

Dr. REKOSKE. The grant from the DOE was about $25 million, 

and we expect that it’s going to be closer to $35 to $36 million complete. The additional funds will be supplied by Honeywell, of 

course. 

Chairman INOUYE. Well, on Kauai, you know, I want to see people succeed, but the meter, how would it help? 

Mr. YAMANE. The direct benefits would be actually the communications. This meter will allow communications back to the utility. 

Right now we have communications to the substation, so basically 

you will be able to remotely read the meters, we’ll be able to detect 

outages by household instead of by feeders, pretty much instantaneously, so that’s the direct benefit. It’s all part of this communication infrastructure. The meter itself is a communication device, 
81 

along with some field routers and collectors, all the way to fiber 

back to the substation. 

Chairman INOUYE. When will that be in place? 

Mr. YAMANE. We anticipate—well, 33,000, that’s pretty much our 

whole island, so anticipate that installation taking about 2 years 

and then 3 years of reporting, gathering data to see the effectiveness of these devices. So, it’s going to be a long process, it’s going 

to take a while, it’s going to involve some labor. 

Chairman INOUYE. How would you say that your project is moving, fast? 

Mr. YAMANE. It’s going to move fast. The process of going 

through the grants and the reporting, we’ve been kind of buffered 

by that. We’ve been fortunate that the Nuclear Regulatory Commission (NRC) has been working directly with the DOE, so we’ve 

just been providing information from our company standpoint. 

We’re at that point where things are really going to start moving 

soon, from about 1 month through this year, we’re going to ramp 

up, we’re going to look for local contractors to start installation, 

within house we’re going to start installing some routers. So, from 

this point on, I think it’s really going to move fast. 

Chairman INOUYE. Well, we don’t have fossil fuels, but we’ve got 

the Sun, the wind, the waves. So, let’s take advantage of that. And 

I think we can count the pilot an example for the world. 

So, I thank you all very much. 

Our final panel, made up of the District Director of the Hawaii 

District Office of the Small Business Administration, Ms. Jane 

Sawyer; the President of Wilson Homecare, Ms. Shelley Wilson; 

and the co-owner of Rising Sun, LLC, Mr. Brad Albert. 

Mr. Albert is not here? 

Voice: I believe he was planning to be here. He had to fly in from 

Maui and we were expecting him about 11:15. 

Chairman INOUYE. Well, Ms. Sawyer. 

STATEMENT OF JANE SAWYER, DISTRICT DIRECTOR, HAWAII DISTRICT OFFICE, SMALL BUSINESS ADMINISTRATION 

Ms. SAWYER. Good morning, sir, how are you? It’s a pleasure to 

see you again. Thank you, Senator Inouye. Hawaii small businesses are really fortunate to have such a strong voice in the U.S. 

Senate. My name is Jane Sawyer and I’m the Hawaii District Director for the SBA. 

Here in Hawaii, we have a district office, as well as a strong network of SBA affiliated partners, as you know. This network includes four small business development centers, and one specialty 

center, and our SCORE chapters with offices on Oahu and Maui, 

that leverage the wisdom of experienced executives through its 

mentoring programs. 

I want to thank you, Senator, for supporting this team on the 

ground by passing the Recovery Act. We know these are tough 

times for small businesses, making the SBA’s mission more important than ever. In particular, the Recovery Act targeted the needs 

small businesses face in accessing capital during the credit crunch. 

The Recovery Act allowed us to temporarily raise guarantees on 

7(a) loans to 90 percent and to reduce or eliminate fees in our flagship 7(a) and 504 loan programs. The SBA has turned just $680 
82 

million in taxpayer dollars into more than $30 billion in lending to 

small businesses. That’s an excellent bang for the taxpayer buck. 

In addition, over 1,300 lenders who had not issued SBA loans 

since at least 2007, have once again started issuing SBA loans. Obviously, this provides more points of access to capital for small 

businesses, and that’s our experience in Hawaii also. We’re seeing 

great success with these programs here in Hawaii where the SBA’s 

average weekly loan volume has increased by nearly 80 percent 

compared to the weeks before the Recovery Act. The SBA has approved more than 400 Recovery Act loans that have supported over 

$100 million in lending to Hawaii small businesses. This includes 

290 loans in Honolulu county supporting over $85 million in lending, 62 loans in Hawaii County supporting over $5 million in lending, 45 loans in Maui County supporting over $13 million, and 29 

loans in Kauai County supporting over $4 million in lending. And 

we know that this means jobs. 

Our borrowers nationwide are reporting that SBA-backed recovery 7(a) and 504 loans will help them create or retain over 700,000 

jobs. Here in Hawaii, small businesses report that they are creating or retaining over 2,800 jobs as a result of these recovery 

loans. Shelley Wilson of Wilson Home Care and Brad Albert of Rising Sun Solar LLC—hopefully he’ll arrive—will personally attest to 

the positive impact stimulus funding has had right here in Hawaii. 

The Recovery Act has also provided the Federal Government 

with increased opportunities to get contracts into the hands of 

small businesses. Our goal is to help small businesses win at least 

23 percent of prime contracts. Put simply, this is a win-win situation. Small businesses get increased volume, sales, and hires. Federal agencies get to work with the most innovative, nimble, and responsive companies in the world. 

I am pleased to report that we are well on our way toward hitting many of our Recovery Act contracting targets. As of June 25, 

over 30 percent of Federal Recovery Act contracting dollars, totaling nearly $9 billion, have gone into the hands of small businesses. 

Here in Hawaii, small businesses have received a total of about 

$100 mi11ion. Hawaii businesses have received contracts from the 

Department of Defense, Department of Commerce, and the Department of Labor, to name just a few. 

Now that’s good news with capital and contracts now. The bad 

news is our recovery loans are so popular that we ran out of money 

1 month ago, a bit ahead of schedule. The President has consistently called on Congress to extend these loans through this fiscal 

year, but it has yet to act. Our message is clear, now is not the 

time to pull back from recovery loans. Small businesses still need 

our help. The credit market is still too tight, even for good, creditworthy borrowers. SBA recovery loans will help them regain traction in an economy that is still working toward full recovery. In 

fact, we received new data showing that SBA loan volume dropped 

dramatically the week of June 14 by about 50 percent. It proves 

that SBA lenders still need that little extra bit of support to make 

good loans to businesses like Wilson Homecare and Rising Sun 

LLC. 
83 

1Data is self-reported by the borrower and appears in the SBA loan application form. 

We also look forward to working with the Senate to permanently increase the size of SBA loans to $5 million. We find that that 

trend is increasingly important to small businesses. 

With that said, we are here to listen and work with you to help 

America’s small businesses create jobs, increase competitiveness, 

and drive our economy. Senator, thank you very much for the opportunity to speak on behalf of the SBA, and I’m pleased to answer 

any questions I might be able to. 

Chairman INOUYE. Thank you very much, Ms. Sawyer. 

[The statement follows:] 

PREPARED STATEMENT OF JANE SAWYER

Thank you Senator Inouye and Senator Akaka. The small business communities 

in Hawaii and throughout the country are fortunate to have such strong voices for 

them in the U.S. Senate. My name is Jane Sawyer and I am the Hawaii District 

Director for the Small Business Administration (SBA). I am honored to be testifying 

before you to report on the impact the Recovery Act has had in helping small businesses survive and grow during these difficult times. In addition to updating you 

on the SBA’s Recovery Act efforts to date, I also look forward to hearing from you 

and the other witnesses about ways to improve our programs to provide small businesses with the tools and resources they need to help continue our economic recovery. 

Here in Hawaii, we have an SBA district office as well as a strong network of 

SBA-affiliated partners. This network includes three Small Business Development 

Centers and our SCORE chapter—with offices on Oahu and Maui—that leverages 

the wisdom of experienced executives through its mentoring program. 

I want to thank Senator Inouye and Senator Akaka for supporting this team that 

is ‘‘on the ground’’ by passing the Recovery Act. The condition of small business is 

critical to our economic recovery because more than half of Americans own or work 

for a small business, and about two of every three new jobs in America each year 

are created by small businesses. And we know these are tough times for small businesses, making the SBA’s mission more important than ever. In particular, the Recovery Act targeted the needs small businesses faced—and continue to face—in accessing capital during the credit crunch. This money has successfully been put to 

work in the place where it can make the biggest impact—the hands of entrepreneurs and small business owners. 

The Recovery Act allowed us to temporarily raise guarantees on 7(a) loans to 90 

percent and reduce or eliminate fees in our flagship 7(a) and 504 loan programs. 

The SBA has turned just $680 million in taxpayer dollars into more than $30 billion 

in lending to small businesses. That is an excellent bang for the taxpayer buck. In 

addition, over 1,300 lenders who had not issued SBA loans since at least 2007 have 

once again started issuing SBA loans. Obviously, this provides more points of access 

to capital for small businesses. 

We’re seeing great success with these programs right here in Hawaii where the 

SBA’s average weekly loan volume has increased by nearly 80 percent compared to 

the weeks before the Recovery Act. The SBA has approved more than 400 Recovery 

loans that have supported over $100 million in lending to Hawaii small businesses. 

This includes 290 loans in Honolulu county supporting over $85 million in lending, 

62 loans in Hawaii county supporting over $5 million in lending, 45 loans in Maui 

county supporting over $13 million in lending, and 29 loans in Kauai county supporting over $4 million in lending. 

And we know that this means jobs. Our borrowers nationwide are reporting that 

SBA-backed Recovery 7(a) and 504 loans will help them create or retain over 

700,000 jobs.1 Here in Hawaii, small businesses report that they are creating or retaining over 2,800 jobs as a result of these Recovery loans. After my testimony, you 

will hear from two local small business owners who have directly benefited from the 

SBA’s Recovery Act lending programs. Shelley Wilson of Wilson Home Care and 

Brad Albert of Rising Sun LLC can personally attest to the positive impact stimulus 

funding has had right here in Hawaii. 

The Recovery Act has also provided the Federal government with increased opportunities to get contracts into the hands of small businesses. There are approximately 

$60 billion in Federal Recovery Act prime contracting opportunities. Our goal is to 
84 

2 According to the Federal Procurement Data System (FPDS). 

help small businesses win at least $13 billion of these contracts to meet the statutory goal of awarding 23 percent of prime contracts to small businesses. Put simply, 

this is a win-win situation. Small businesses get increased volume, sales, and hires. 

They get a ‘‘lift’’ to be competitive in the global marketplace and help lead the nation in its economic recovery. In addition, Federal agencies get to work with the 

most innovative, nimble, and responsive companies in the world. 

I am pleased to report that we are well on our way towards hitting many of our 

Recovery Act contracting targets. In fact, so far we have exceeded the overall 23 percent goal for stimulus contracts. As of June 25, over 30 percent of Federal Recovery 

Act contracting dollars, totaling nearly $9 billion, have gone into the hands of small 

businesses. Moreover, various disadvantaged groups have received significant Recovery Act contracting dollars. We are currently achieving over two times our goal of 

5 percent for Small Disadvantaged businesses, which have received over 12 percent 

of Recovery Act contracting dollars. Here in Hawaii, small businesses have received 

nearly 45 percent of Hawaii’s Recovery Act contracting dollars, for a total of about 

$100 million.2 Hawaii small businesses have received contracts from the Department of Defense, Department of Commerce, and the Department of Labor, to name 

just a few. 

That is the good news we are happy to share. The bad news is that these Recovery loans are so popular that we ran out of money a month ago. The President has 

consistently called on Congress to extend these loans through this fiscal year, but 

it has yet to act. Our message is clear: the lesson we have learned from the Recovery Act is that now is not the time to pull back. Small businesses still need our help. 

The credit market is still too tight, even for good, creditworthy borrowers. SBA Recovery loans will help them regain traction in an economy that is still working toward full recovery. In fact, we received new data showing that SBA loan volume 

dropped dramatically the week of June 14—by 50 percent. It proves that SBA lenders still need that little extra bit of support to make good loans to good businesses 

like Wilson Homecare and Rising Sun LLC. 

With that said, we are here to listen and work with you to help America’s small 

businesses create jobs, increase competitiveness, and drive our economy. Senator 

Inouye and Senator Akaka, I thank you again for the opportunity to speak on behalf 

of the SBA. At this time, I am pleased to take your questions. 

Chairman INOUYE. Ms. Wilson. 

STATEMENT OF SHELLEY WILSON, PRESIDENT, WILSON HOMECARE 

Ms. WILSON. I don’t have a formal presentation for you, and I did 

prepare the testimony that your offices have received, but I’m here 

as a witness and a example of how wonderful the SBA funding can 

be. And for a business like Wilson Homecare, it’s a win-win situation in our community. 

I’ve been in business for about 15 years, servicing the Kapuna in 

our community, and my home healthcare company employees about 

300 employees statewide, and we provide about 5,000 hours a week 

in care to individuals primarily in their homes. And for many, 

many years, the community continually asks us for additional resources to provide services for those in need. And as you are well 

aware, our infrastructure and healthcare is challenged in itself, 

and the SBA made one of my long-term dreams possible last year 

when they funded the first senior living home for Wilson 

Homecare. And so not only will we be able to provide for services 

in individuals homes, we will have our own senior that’s currently 

under construction in Kilauea. The monies that we received were 

about $2 million and the bank paid for the other portion of the loan 

that we received. 

And with that money we’ll be able to create additional jobs. I 

know the construction industry has been very, very happy with me 

and with my project, and I’ve not really had any experience with 

construction workers before, but they’re awfully friendly. And we 
85 

have more than enough people that have been offering to help us 

with our project. There’s so many people that need a job in the construction industry, and it’s kind of a sad situation that we can’t— 

we can’t be building more. But the SBA certainly has made it possible for us to build this home. And by the end of the year we’ll 

be moving in our very first residents into that property. 

Chairman INOUYE. Thank you very much. 

[The statement follows:] 

PREPARED STATEMENT OF SHELLEY WILSON

Thank you Senator Inouye and Senator Akaka for your continued support of the 

business community in Hawaii. The appreciation for the tremendous work that is 

being done in Washington on behalf of the State of Hawaii is in abundance throughout the islands. I’m honored to provide testimony that brings true life to the impact 

from the American Recovery and Reinvestment Act of 2009 in Hawaii and on my 

business. 

My name is Shelley Wilson and I am the president and founder of Wilson 

Homecare, a home healthcare agency that serves the island of Oahu. Wilson 

Homecare provides services in homes and facilities to individuals of all ages with 

many different personal care needs ranging from home assistant and nurse aide to 

skilled nursing care. The hours providing care to individuals range from 4 hours a 

week to 24 hours a day. Wilson Homecare currently provides an average of 5,500 

hours per week in care. The 2009 annual revenues were $4.6 million, employing 343 

staff, and we were ranked as the 15th largest woman-owned business in Hawaii. 

I am active in the local business community, as the incoming chair of the Chamber of Commerce of Hawaii beginning July 2010, current chair of the Chamber 

Small Business Committee, a board member for Kapi’olani Medical Center for 

Women and Children, a board member for Kahi Mohala Behavioral Health, and a 

recent addition to the board of the East West Center, and past president of the Organization of Women Leaders. 

I was inspired to start my business in 1996 after moving to Hawaii from Iowa. 

I was injured in 1992 while on active duty with the Iowa Army National Guard. 

I spent several years recovering from an accident that left me incapacitated for 

much of the time. I developed a true appreciation for the homecare model during 

my recovery at home. Most days, I hoped the caregiver wasn’t one of my family 

members. After it became too difficult to stay in a cold climate with my plethora 

of injuries, I decided to relocate to Hawaii in 1994. Sixteen years later, my family 

still asks when I’m moving back. 

At the age of 21, when I started Wilson Homecare, my passion to provide 

homecare services to others in need was borne from my own personal experiences. 

I wasn’t an entrepreneur; I just wanted to provide people with options when they 

required care as I once did. I didn’t have the arsenal of life experience that MBA 

programs speak about when embarking on developing one’s business infrastructure. 

I didn’t know about taxes, insurance, management, payroll, and the like. I was a 

feisty young person that had a life changing experience that only wanted to better 

the lives of others. 

My first few years as president of this company were anything but glamorous nor 

did it come with a paycheck. Headquarters was my living room in my tiny apartment and with one employee, me. It was challenging and most people told me to 

‘‘get a real job.’’ I had three ‘‘real jobs’’ while I was trying to get the job I have now! 

Fortunately, I’m stubborn and was driven by my vision. I never lost sight of what 

my focus was in changing the lives of others. My first big break came when I received a modest SBA loan to help me get off the ground. That money assisted in 

developing collateral to sell my services to prospective clients, and enabled me to 

purchase basic office supplies, a reliable phone, and provided my first ‘‘real’’ debt. 

I was on my way! 

Flash forward to 2010 and Wilson Homecare has become the largest licensed private home healthcare company in Hawaii employing more than 300 staff. The vision 

I once had became a reality in caring for thousands in our community and truly 

changing lives. I would not be here if it weren’t for my first starter loan from the 

SBA. The initial investment the SBA made has provided so much to so many, from 

employing members of our community to helping care for their family needs, putting 

money back into our local business, and of course, providing the much needed home 

healthcare to those in need and giving the relief desperately needed to families and 

loved ones. 
86 

I’ve continued to expand and grow the resources available to our aging community 

by starting another company that is currently building a senior living home in 

Kailua. Once again, my vision was made possible by the SBA through the 504 loan 

program which I received last year. I’m currently underway with construction and 

hope to welcome my first client by Thanksgiving. The Wilson Senior Living Home 

has invested approximately $4 million in the Windward communities, created dozens of construction jobs, will create another 30 healthcare jobs, and will provide a 

beautiful home where seniors will be cared for in a home environment with dignity 

and respect close to their loved ones. 

In essence, the American Recovery and Reinvestment Act of 2009 have built the 

first Wilson Senior Living Home and my second company. The approval of the loan 

for Wilson Senior Living came during a very difficult time in our economy when our 

community needed resources more than ever before. It was serendipity. The process 

was straight forward, and the SBA was incredibly supportive in guiding my way. 

I received a fairly quick reply from the loan committee, and I’ve been so thankful 

for the cost savings recently realized in loan fees. At the end of a construction 

project, every little bit counts! 

I often share my SBA success story with other small business owners so they’re 

aware of the possibilities and seek out opportunities for their business to be successful, just as I did many years ago and again last year. I have continued to receive 

the support from the SBA as a partner in helping to carry out my vision and provide 

the care models our community desperately needs. I appreciate the opportunity to 

bring life to the ARRA funds I’ve received from the Small Business Administration 

and provide validation to the work that has been done to make it possible. I’m indebted. 

Aloha. 

Chairman INOUYE. I’m glad you made it. 

STATEMENT OF BRAD ALBERT, OWNER, RISING SUN, LLC 

Mr. ALBERT. Yeah, thanks, I was actually downstairs talking to 

Senator Gabbard’s office about some other related issues. 

So, my name is Brad Albert, and I’m from Maui. I have a solar 

business on Maui. We started it in 2003, and before that we were 

an electrical contracting company. Since about 2005, we’ve been 

able to be 100 percent focused on installing solar systems, and 

that’s what we do. We no longer do general electric work. We’re the 

largest company—we’ve done the most number of installations on 

Maui, but we do other installations. Actually, I think I met you at 

the—we were the company that installed the system at NELHA, 

the Natural Energy Gateway Center—and we’ve benefited through 

our—we were awarded a job at the Maui Supercomputing Center, 

a research project for concentrated PV systems. 

So I guess part of my testimony is that the money that ARRA 

is providing to the military that’s being spent on research for renewable energy is actually impacting our business in a positive 

way. And there was another solar contracting company that was 

originally awarded the bid that was owned, majority owned now by 

a Chinese manufacturer, so they had to step out—step away from 

it and we got it, so I guess they’re towing the line as far as making 

there are U.S. owned companies as well. 

I’m also a member of the Hawaii PV Coalition, or I’m the Chairman of the Hawaii PV Coalition, which is a nonprofit that looks at 

solar electric specifically, and then there’s another group called the 

Hawaii Solar Energy Association that I’m also on the board of that 

organization. And that’s the main lobbying group in Hawaii, in 

terms of policy and—and regulation. 

And right now, if I could, you know, kind of give you a few bits 

of testimony. I think the first thing is just to support Jane, like we 

were the recipient of a 7(a) loan, and our business is, you know, 
87 

doing well, we’re growing year to year. However, in order to finance 

our growth, we need access to capital. And so, we’ve been able to 

achieve that through the 7(a) loans, and I’m pretty—I mean, 1 year 

ago I was really chewing my fingernails and I’m doing it again this 

year, in terms of going to the bank and asking for more money. 

Like I’m going to ask them to double our money this year, and we 

need it because we’re doubling our business. And there’s a proportionality to what you need in a line of credit to do business and 

hire more people and run a business. 

And I don’t think that we would have gotten it if it wasn’t for 

the ARRA money, and I really—it’s hard to, you know, kind of 

judge, just everything I was reading and hearing on TV would suggest that the banks were not going to give us money, and we were 

like, ‘‘Well, what are we going to do?’’ And we got it, and so we 

were successful and we, you know, kept—at least kept everyone 

employed that we had employed and we did employ some more people towards the end of the year. 

One of the downfalls of having a tax-based policy, you know, we 

get tax credits and that motivates people to do their systems, is 

that it becomes seasonal and people do their systems toward the 

end of the year, so we typically have to hire on additional labor at 

the end of the year and then let them go at the beginning of the 

year. We’d like to try and smooth that out. And one of the—section 

1603 of the Treasury Grant Program is making the tax credit that 

was a tax credit a grant. So you have to apply and say, ‘‘I’d like 

to take the 30 percent Federal tax credit for renewable energy as 

a grant,’’ so that 60 days after you finish your project you get that 

in cash. That’s been something that potentially helps smooth out 

the year, allows us to do more systems, and keep people employed 

year round. 

So, the way—that is due to expire at the end of this year, and 

part of my testimony is that we really feel like it could be—if it 

was extended, it would mean jobs and more renewable energy installed, not only in Hawaii but across the country. It’s in my written testimony, but just to point out a few numbers. It would mean 

about 400 new jobs in Hawaii, and that’s next year in 2011, but 

by 2016 it would actually mean 450 jobs, as well as retaining jobs. 

I think we’d actually lose some jobs if we didn’t extend this program. 

The State of Hawaii put forth a feed-in tariff, which hasn’t actually gone into effect yet, but all of those—I would say the large majority of those projects are counting on the Treasury Grant Program to fund their projects. In other words, the developers of these 

projects are going to have a hard time getting access to capital to 

fund these, you know, what amounts to primarily solar projects. 

And, you know, the solar energy that’s being produced would be 

being sold into the grid, so through the feed-in tariff program—I 

don’t know how familiar you are with the feed-in tariff because 

there really isn’t a lot of feed-in tariff programs in the United 

States. I think there’s one in Florida that was sold out in the first 

day that it came out. And there is a limited amount of feed-in tariff 

grid access here, it’s 5 percent of the grid and I don’t believe that 

it would be sold out in the first, you know, day. It really depends 

on how aggressive the pricing is. 
88 

But the point anyway, is that there will be some jobs and 81 

megawatts of solar projects by 2016 is the estimate if this grant is 

extended. Nationally it would mean 65,000 new jobs by 2016, and 

5,100 megawatts of green energy installed. 

And so, I think the overall theme, aside from some of the stuff 

to do with, you know, the details with 7(a) or this Treasury Grant 

Program, is that like, you know, what’s happening in the gulf and 

really what’s happening around the world politically, it only like 

highlights, underlines, and bolds that America needs to continue to 

invest in renewable energy. And we’re just a part of that. And my 

testimony, like there’s all these little pieces, but anything that’s involved in ARRA, whether it’s money to the Government to research 

renewable energy, we’re benefiting from that, whether being able 

to finance our business through this, you know, 7(a) loan program, 

which isn’t really related to renewable, but it does relate, or the 

Treasury Grant Program. 

Like, you know, we need to stop talking how we’re going to like, 

you know, do renewable energy and go solar, you know, and everyone’s really good at campaigning and saying they’re for renewable 

energy, but we need to, you know, there needs to be the means. 

You know, we need the money and the—and the determination to 

really go for it. Because this is what America needs, it’s really 

what’s going to, you know. I wrote in my written testimony here. 

‘‘America’s success or failure to create clean energy policy will determine America’s financial success and national security.’’ And so, 

I think that’s pretty clear. 

There’s one other thing, which is the Solar Manufacturing Jobs 

Creation Act, and I would just ask you to support that as well. 

That will also create 160,000 additional jobs in the solar industry 

and related sectors by 2016. And, while also supporting 5,600 

megawatts of additional solar installations by 2016. So the point is, 

not that we should just be installing renewable energy and solar 

projects in the United States, but that we should be making the 

products that we’re installing. 

Thank you for the opportunity to testify. 

[The statement follows:] 

PREPARED STATEMENT OF BRAD ALBERT

Thank you for the opportunity to testify. I am co-owner of Rising Sun Solar a 

Maui based licensed electrical contracting company C–28184 specializing in the design and installation of residential and commercial solar electric systems. In addition to being a business owner I am president of the Hawaii PV Coalition and a 

board member of the Hawaii Solar Energy Association. My testimony will hopefully 

give you insight into how ARRA funds have helped to grow the Hawaii solar market 

creating jobs and reducing dependence on foreign oil. 

First and foremost as a an overriding and urgent priority the gulf oil spill only 

highlights and underlines in bold that: America needs to continue to invest in renewable energy! 

America’s success or failure to create clean energy policy will determine America’s 

financial success and national security. 

Rising Sun has benefitted from the ARRA SBA 7a loan guarantees. Access to capitol has been essential for our company to grow and manage cash flow. We have 

increased our SBA guaranteed line of credit year to year as our business has grown. 

Without the SBA loan guarantee our business would not be able to fund growth and 

create new jobs. Extending the loan guarantee will provide access to capitol for 

small businesses including many new businesses such as ours involved in renewable 

energy. 
89 

The solar industry has also benefitted from Section 1603 Treasury Grant Program 

(TGP). As you know the TGP is scheduled to end this year. Extending the TGP for 

two more years is necessary and critical to make renewable energy projects happen 

in Hawaii and nationally. To date the TGP has funded 19 solar projects in Hawaii 

worth $10 million. In Hawaii a 2 year extension of the TGP would create 400 new 

jobs in 2012 and 450 jobs by 2016 and would also result in an estimated additional 

81 megawatts of solar projects in Hawaii by 2016 (see attached report named 

TGPHawaii.pdf). 

Nationwide the TGP will create nearly 65,000 new jobs to the solar workforce resulting in 5,100 megawatts of new solar installations by 2016. The benefits of the 

TGP are just beginning to take hold as the application and guidance for the program were only made available in the summer of 2009; less than 1 year ago. It is 

clear that the program is effective and should be extended. (See attached 

TGPUSA.pdf) 

According to Solar Energy Industries Association (SEIA) Solar Energy creates 

more jobs per megawatt of energy produced than any other form of energy (renewable or fossil). However the United States has lost its leadership in the manufacturing of solar cells. As recently as a decade ago, the United States accounted for 

40 percent of global solar photovoltaic (PV) cell production. In 2008 the United 

States accounted for only 5 percent of world solar cell production. ARRA created a 

limited short-term incentive, but it isn’t enough to support long term job growth in 

solar manufacturing. 

The Solar Manufacturing Jobs Creation Act H.R. 4085 and S. 2755 would add 

equipment used to manufacture solar energy generating property to the eligible 

property list of the existing section 48 commercial solar investment tax credit (ITC). 

Current law provides a 30 percent tax credit for solar energy generating property 

placed in service in the United States before January 1, 2017. The legislation would 

allow a 30 percent credit for investments in equipment placed in service in U.S. 

Solar manufacturing facilities before January 1, 2017. An independent study by 

EuPD Research found that the proposed legislation would create nearly 160,000 additional jobs in the solar industry and related sectors by 2016, while also supporting 

5,600 MW of additional solar installations through 2016. (See attached MITC.pdf) 

In conclusion economic recovery has begun and the solar industry is growing and 

creating jobs. However, from the perspective of a small solar business in Hawaii, 

our continued success will depend on the commitment and support of both Federal 

and state incentives. Clean energy and specifically PV solar needs to be a major 

focus for the America and Hawaii’s energy future. 

Thank you for your consideration. 

ECONOMIC IMPACT OF TREASURY GRANT PROGRAM EXTENSION IN HAWAII

Hawaii stands to realize significant benefits from an extension of the section 1603 

Treasury grant program. Currently, this program allows developers of renewable energy projects to claim a grant in lieu of tax credits for projects that commence construction before the end of 2010. However, the financial market conditions that necessitated this program continue and are not expected to clear before this program 

expires. Extending the commence construction deadline by 2 years will enable more 

projects in Hawaii; that’s more jobs and more clean energy. 
90 

According to a recent study by EuPD Research: 

—A 2-year extension of the 1603 grant program will support 400 additional jobs 

in Hawaii in 2011 and over 450 additional jobs in 2016. (The job impacts extend 

beyond 2012 because of continued plant construction and ongoing operations 

and maintenance positions. See chart above for more on employment impacts 

on extending the grant program.) 

—Extending the grant program would also yield an additional 81 MW of solar 

power in Hawaii by the end of 2016. See lower right chart for more on the impacts of extending the grant program. 
91 

1These are jobs supported by the solar industry above baseline forecasts. Total industry employment increases from 2015 to 2016, but the added benefit of the Treasury Grant diminishes. 

This estimate is for solar energy only, it does not account for jobs created by other renewable 

energy technologies. Read the full report at http://seia.org/galleries/pdf/EuPD Research Solar Report.pdf. 

Current Impact of TGP 

To date, companies in Hawaii have received nearly $10 million in TGP funding 

for 20 renewable energy projects, 19 of which are solar electric and solar thermal 

projects. With a 2-year extension of the TGP commence construction deadline, these 

numbers will continue to grow. 

EXTEND THE TREASURY GRANT PROGRAM

65,000 new jobs will be added. 

5,100 megawatts of additional solar power to be deployed across the United 

States. 

$400 million in government savings. 

Extending the existing Treasury Grant Program (TGP) by 2 years will add nearly 

65,000 new jobs to the solar workforce and supporting industries across the United 

States in 2015.1 Such an extension to the program, which allows grants to be issued 

in lieu of tax credits for renewable energy, would also accelerate solar deployment 

across the United States, resulting in 5,100 megawatts (MW) of new solar installations through 2016—enough to power more than 1 million homes. 

Moreover, extension of the Treasury Grant Program will yield a net savings to 

the government of $400 million between 2010 and 2016, as the public cost of the 

extension is more than offset by the avoided unemployment costs to the government 

and additional income tax revenue generated by new jobs resulting from the extension. 

A 2-year extension is projected to create significant new jobs in the solar industry 

and supporting sectors across the United States. For example, California would gain 

more than 25,500 new jobs; Arizona would add approximately 7,200 new jobs; Texas 

would gain more than 6,700 new jobs; Michigan would add over 5,100 new jobs; 

New Mexico and Nevada would each gain more than 3,000 new jobs; Ohio and Oregon would each add more than 2,000 new jobs; Colorado and Florida would each 

add over 1,800 new jobs; and New Jersey, New York, North Carolina, and Pennsylvania would each gain more than 1,000 new jobs. 
92 

Extension of the Treasury Grant Program will also result in substantial increases 

in solar technology deployment. California could add over 2,500 MW of new solar 

installations; Arizona, nearly 1,000 MW; and Colorado, Connecticut, Florida, Nevada, and New Jersey each adding more than 100 MW of new solar power. 100 MW 

is enough to power 20,000 American homes. 

Background 

In 2009, the American Recovery and Reinvestment Act created the Treasury 

Grant Program, allowing a cash grant to be used in lieu of tax credits for renewable 

energy projects. Although the U.S. unemployment level remains high, the program 

is set to expire in December 2010. SEIA hired independent consulting firm EuPD 

Research to analyze the economic impact in the United States during 2010–2016 of 

extending the Treasury Grant Program by 2 years. The findings of the EuPD study 

complement the results of a Lawrence Berkeley National Laboratory study from 

April 2010 showing strong employment levels in renewable energy industries during 

the first year (2009) of the TGP. 

Recommendation 

Based on the EuPD study, SEIA recommends a 2-year extension of the Treasury 

Grant Program. Not only will this extension yield a fiscal benefit to the government, 

but it will result in over 65,000 new jobs in 2015 and support the manufacturing 

and installation of 5,100 MW of clean, reliable solar energy technologies during 

2010–2016. 

THE SOLAR MANUFACTURING JOBS CREATION ACT

H.R. 4085 (THOMPSON, CAMP, DOGGETT, TIBERI) AND S. 2755 (MENENDEZ, STABENOW)

Overview 

The Solar Manufacturing Jobs Creation Act would add equipment used to manufacture solar energy generating property to the eligible property list of the existing 

Section 48 commercial solar investment tax credit (ITC). Current law provides a 30 

percent tax credit for solar energy generating property placed in service in the 

United States before January 1, 2017. The legislation would allow a 30 percent cred-
93 

1Graphs show the number of jobs and installations supported by the solar industry above 

baseline forecasts without a Section 48 amendment. This estimate is for solar energy only; it 

does not account for the impact of other renewable energy technologies. Read the full report at 

http://seia.org/galleries/pdf/EuPD Research Solar Report.pdf. 

it for investments in equipment placed in service in U.S. manufacturing facilities 

before January 1, 2017. An independent study by EuPD Research found that the 

proposed legislation would create nearly 160,000 additional jobs in the solar industry and related sectors by 2016, while also supporting 5,600 MW of additional solar 

installations through 2016.1

Supporting Points 

The United States is losing the global race for solar manufacturing jobs. 

—As recently as a decade ago, the United States accounted for more than 40 percent of global solar photovoltaic (PV) cell production. In 2008, the United States 

produced only 5 percent of the world’s solar cells, with Europe and Asia leading 

global production. 

Other countries are racing to create domestic demand for solar cells and to attract 

solar manufacturing jobs. Many nations offer generous incentives to locate solar 

manufacturing in-country. 

—Philippines: 6-year income tax holiday. 

—Malaysia: 15-year income tax holiday. 

—Germany: Grants of 30 percent of investment costs for large enterprises. 

—Singapore: Multi-year tax holidays. 

ARRA created a limited short-term incentive—but it isn’t enough to support longterm job growth in solar manufacturing. The 2009 American Recovery and Reinvestment Act (ARRA) included a competitive tax credit capped at $2.3 billion in total 

tax expenditures for advanced energy manufacturing projects (new code Section 

48C). The 48C credit is a very good start to increase domestic solar manufacturing; 

however: 

—Firms must apply and are not guaranteed to receive a 30 percent credit unless 

certified as a recipient by Treasury; the program will be oversubscribed and 

only a fraction will receive a credit. 

—Now that the $2.3 billion cap is exhausted, the program is due to sunset. 

SEIA supports the Administration’s proposed $5 billion in additional funding for 

the Section 48C program. 

An improved tax incentive for solar manufacturing will create long-term growth 

and U.S. jobs. 

—Independent consulting firm EuPD Research analyzed the economic impact in 

the United States during 2010–2016 of amending Section 48 to include solar 

manufacturing equipment. The results of the study show that nearly 160,000 

domestic jobs would be created by 2016 as a result of this policy change. Additionally, 5,600 MW of additional solar PV and CSP capacity would be installed 

between 2010 and 2016.1

—Solar energy creates more jobs per megawatt of energy produced than any other 

form of energy (renewable or fossil). Tax incentives to support U.S. solar manufacturing will ensure a strong solar manufacturing base and maximize renewable energy employment. 

—Amending Section 48 (the commercial solar ITC) to include solar manufacturing 

equipment would create a generally available and immediately reliable 30 percent credit for the tools used to create solar panels. 

—New U.S. solar manufacturing facilities could begin construction soon after date 

of enactment with the 30 percent credit definitively in their financial calculations. Firms would have an incentive to make their investments early in order 

to capitalize on the grant program, greatly increasing the amount of investment 

and new jobs in the near term. 

—The solar industry also strongly supports the extension of the Section 48C program and the Administration’s proposed funding level of $5 billion. 
94 

ABOUT THE SOLAR ENERGY INDUSTRIES ASSOCIATION

Established in 1974, the Solar Energy Industries Association is the national trade 

association of the U.S. solar energy industry. As the voice of the industry, SEIA 

works with its 1,000 member companies to make solar a mainstream and significant 

energy source by expanding markets, removing market barriers, strengthening the 

industry and educating the public on the benefits of solar energy. For a referenced 

version of this factsheet and more information, please visit www.seia.org. 

Chairman INOUYE. You have to believe I’m with you on everything you’ve said. 

Mr. ALBERT. I know that you are. 
95 

Chairman INOUYE. I won’t discuss this here, but there are elements in Congress that just don’t want us to move. Your products—your projects are being seriously considered, and I can assure 

you that the majority of the Congress looks upon small business as 

an important part of the backbone of our economy. And, in order 

to make certain that these measures like yours are passed and implemented—we ordinarily have recesses in August to give us a little break. I just got notified yesterday that it’s going to be 1 week 

less. But it’s just as well, because if there’s work to do we’ll do the 

work. And I can assure you we’re with you. 

Ms. SAWYER. Thank you. 

Chairman INOUYE. Only thing, Mr. Albert, if you succeed too 

much, you won’t be small business. 

Ms. SAWYER. And he has been very successful. We’re really 

pleased. Brad and his partner started their business using an SBA 

Partner Small Business Development Center for counseling when 

they were setting up their business, helped them with their first 

proposal to get funding, and both times they’ve gone for funding 

they’ve been able to secure SBA financing. The second round was 

a significant increase and they took the credit for the fee waiver 

with the 7(a) line of credit they established with one of our local 

banks. So that was a significant amount of money for them. 

And likewise, with Shelley’s project, the fee waiver left her 

enough money to put either back into the project or even to make 

sure that she could create those jobs. So, it’s about 3 percent of the 

total amount of the loan, which for—can be a—with our programs, 

up to $60,000, depending on the amount of the loan. 

Chairman INOUYE. Ms. Wilson, did you say you have 300 employees? 

Ms. WILSON. In my home healthcare business that I’ve had for 

the last 15 years. 

Chairman INOUYE. And when is this home going to be finished? 

Ms. WILSON. I’m hoping in September. I’ve been taking very good 

care of the construction workers, so I understand how that works 

now. So every Friday I show up with lunch and some beverages. 

Chairman INOUYE. I can see why you’ve succeeded. 

Ms. WILSON. Actually, I’m using the additional money and I’m 

negotiating my solar this week, so we might need to talk after this. 

I have extra money to actually install some of the perks and the 

things that weren’t within our budget initially. 

Ms. SAWYER. And now I know where to go on Friday afternoon 

or Friday for lunch because your care home is about 1 mile away 

from my residence, over on Kanuawei Bay Drive. It’s a great facility. 

Chairman INOUYE. How many rooms will you have there? 

Ms. WILSON. We’ll have 20 private bathrooms and bedrooms, 

they’re suites, and it’s in a residential—it’s a residential model, so 

the State licensing, adult residential care home type II, so it’s within the neighborhood and not, you know, in the boonies, as far as 

most of the nursing homes or nursing facilities. So it’s a smaller 

family type model that I intend to replicate in other areas in our 

island so people can stay within their communities. 

Chairman INOUYE. How much would it cost for anyone to be one 

of your tenants? 
96 

Ms. WILSON. One of our neighbors, the residents that will move 

in, the fees start around $8,000. And for home healthcare services, 

the rates within—the average rate is about $20 an hour, and so 

that adds up pretty quickly. And so some of our home healthcare 

patients pay $15,000 to $20,000 a month. So the long-term care figures are outrageous. 

Chairman INOUYE. Fifteen or $20,000 a month? 

Ms. WILSON. For home healthcare, for $20 an hour. And so, this 

residential model is about one-half of what it costs if you have inhome care. And the other nursing homes and facilities within our 

island have pretty substantial wait lists. And the fees, the longterm care component that people are not prepared for, it’s pretty 

shocking for most of our families and residents. 

Mr. ALBERT. I would add one thing, just that, you know, a lot of 

people think Brad is doing great in renewable energy, they don’t 

need any help, right. I just would say that while we’re doing well 

on paper, in terms of growing number of installations and so forth, 

we’re so vulnerable each year, you know, year to year, that a tax 

credit is going to get taken away. And here in Hawaii regulatory 

issues that we don’t have any more grid access, although there’s a 

demand for solar systems, that we’re kind of in a little bit of a debate with the utility over how many more solar systems we can install. 

So, I was listening on the monitor about smart grid, that’s part 

of the solution too, so it’s not just about installing more renewable 

energy, it’s about making the grid capable of accepting all these renewable energy systems. 

Chairman INOUYE. Hawaii has a law, if I’m not mistaken, that 

requires all new construction to have solar energy. 

Mr. ALBERT. That’s solar hot water, and so that’s more of an energy efficiency device, whereas the systems that we sell primarily 

are systems that generate energy on site and sometimes export to 

the grid. So, you know, solar hot water is part of the solar industry, 

but it’s more of something that’s just having the homes use less energy, whereas what we’re selling is something that’s generating 

clean energy instead of importing oil, which if you use less energy 

you do that, too. 

Chairman INOUYE. Thank you very much, Mr. Albert. 

Mr. ALBERT. Thank you. 

Ms. SAWYER. Thank you. 

Ms. WILSON. Thank you. 

ADDITIONAL SUBMITTED STATEMENTS

Chairman INOUYE. Before we recess, I’d like to announce that 

we’ll keep the record open until July 22, so if you have any additional testimony you’d like to make, feel free to do so. 

And I hope that the other witnesses have been advised of that. 

So, thank you very much, appreciate it. Wish you very great success. 

[The statements follow:] 
97 

PREPARED STATEMENT OF ABRAHAM Y. WONG, ADMINISTRATOR, HAWAII DIVISION, FEDERAL HIGHWAY ADMINISTRATION, DEPARTMENT OF TRANSPORTATION

Chairman Inouye, Ranking Member Cochran, and Members of the Committee, 

thank you for the invitation to appear before you today to discuss the impact on 

Hawaii’s economy of funding for highway infrastructure under the American Recovery and Reinvestment Act of 2009 (Recovery Act). The Federal Highway Administration (FHWA) Hawaii Division Office has been working very closely with the Hawaii 

Department of Transportation (HDOT) to ensure that Recovery Act highway 

projects are implemented efficiently to put more people to work. 

Signed into law by President Obama on February 17, 2009, the Recovery Act was 

an unprecedented effort to jumpstart our economy, create or save millions of jobs, 

and put a down payment on addressing long neglected infrastructure challenges so 

our country can thrive in the 21st century. The Recovery Act has been a lifeline for 

Americans who work in construction and have been especially hard hit by the recession. 

Today, I want to update you on FHWA’s activities for effectively administering the 

Recovery Act in Hawaii. 

OVERVIEW

Overall, the Recovery Act provided $48.1 billion for transportation programs to be 

used for improvements to our Nation’s highways and bridges, transit systems, airports, railways, and shipyards. The single largest investment of Transportation Recovery Act dollars—$27.5 billion—was targeted at improving highways and bridges. 

This included $125.7 million for highway investment in Hawaii. Across the United 

States, FHWA has committed more than $26 billion from the Recovery Act to over 

12,700 highway projects. 

We have six times more Recovery projects underway this summer than we did 

last. We are going to improve more than 30,000 miles of highway this summer— 

three times as many miles as we improved last summer and enough to make 10 

trips across the country. 

We are going to make travel safer and easier for millions of people, and we are 

going to create jobs. Overall, the Recovery Act is already responsible for about 2.5 

million jobs, with tens of thousands of those in the transportation sector. 

RECOVERY ACT IMPACT IN HAWAII

The FHWA has been working hard to ensure that the $125.7 million in highway 

funds Hawaii received under the Recovery Act are invested quickly and wisely. Our 

partnership with HDOT to administer the Recovery Act started before the Act was 

passed. Anticipating passage of the bill, the FHWA Hawaii Division Office worked 

with HDOT and coordinated with local agencies to identify projects that could be 

started and completed expeditiously while striking the best balance between funding 

and needs. The Hawaii Division Office used regularly scheduled meetings, video conferences, and various program planning scenarios to consider the most effective and 

efficient way forward for Hawaii. 

The Recovery Act dollars in Hawaii are being used to improve pavements, rebuild 

traffic signals and intersections, reduce congestion, and preserve and make bridges 

safer. The Hawaii Division Office has now authorized 23 projects in Hawaii, which 

we estimate will provide approximately 200 full time jobs. Of these authorized 

projects, 20 have been awarded for a total of nearly $95 million, and HDOT has 

issued a notice to proceed with work starting on 17 of these projects totaling nearly 

$85 million. Hawaii has expended over $20.5 million of its highway dollars. 

The Recovery Act included a requirement that States obligate 100 percent of their 

highway funds by March 1, 2010. Working with our State partners, all States met 

this ambitious deadline. In fact, Hawaii beat the deadline by nearly a week. 

The Recovery Act additionally requires States to give priority to projects located 

in Economically Distressed Areas (EDAs), and FHWA has oversight responsibility 

to ensure that the States fulfill this requirement. Currently, of the funds already 

obligated in Hawaii, 39 percent are directed toward EDAs for 5 projects totaling 

over $48 million. Our Hawaii Division Office will continue to work with the State 

to ensure that the State is giving priority to EDAs in the selection of any additional 

projects. 

Projects Completed 

Eight of the State’s projects have already been completed, and Hawaii’s residents 

and visitors have begun to enjoy the benefits. For example, construction has been 

completed for seismic retrofit of two critical overpass bridges on the H–1 freeway 

in the Kapolei area of Oahu. This $865,000 Recovery Act project used fiber rein-
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forced polymer wrap technology to ensure seismic safety for these key bridges. Another project has been funded that will provide a similar seismic resistance to a 

third bridge that carries Mokapu Boulevard over H–3 on the Windward side of the 

island. 

The Maunaloa Highway resurfacing project on Molokai provided new pavement to 

1.96 miles of the island’s roadway. This $2.6 million project provided work for an 

estimated 18 individuals in this Economically Distressed Area. The project started 

in August 2009 and was completed in December 2009. 

The Farrington Highway resurfacing provided 3.7 miles of new paving on Maui. 

This $5.4 million project provided employment opportunities for 18 individuals in 

this area. Work started in December 2009 and was completed last month. 

The Kalae Highway slurry seal was a $1 million pavement preservation project 

that provided employment for eight workers on Molokai. This approximately fivemile project will increase the service life of the roadway by preventing water intrusion into the pavement. This project was completed in January 2010 after approximately 3 months. 

Projects Under Construction 

Many important Recovery Act projects are also well underway throughout the 

State. For example, the $15.3 million South Punaluu Stream Bridge project is providing a new structure to carry the Kamehameha highway to Oahu’s northwest 

shore. By replacing a structure that has been in service for 85 years, the new concrete bridge will meet current vehicle load, safety, and seismic standards. The new 

bridge will include 8-foot shoulders and a separated pedestrian path. 

Construction has also started on the $30 million Ane Keohokalole Mid-Level 

Highway, which will help ease increased traffic congestion in the rapidly growing 

Kailua-Kona area on Hawaii’s west coast. The route, which serves an estimated 

22,700 daily drivers, is home to Kealakehea High School, a community center, and 

will soon be home to a new campus of the University of Hawaii. Though the university’s ‘‘West Hawaii Center’’ is not yet open, 1.5 miles of new road—the Ane 

Keohokalole Mid-Level Highway—must be built to accommodate traffic which is projected to increase by nearly 50 percent by 2029. The initial phase creates a two-lane, 

limited-access roadway that will also include bike lanes, sidewalks, a multi-use 

path, and be used as a transit route by the county’s bus service. In addition to reducing congestion, the new road will make Kailua-Kona safer for pedestrians and 

bicyclists while improving the area for planned businesses and housing developments. The project is also opening up approximately 300 acres of state land for future development. 

A clean and paint project has started in the Paauila area on Hawaii Belt Road. 

This $4.3 million Recovery Act investment will protect and preserve four historic 

steel trestle bridges by removing the existing lead-based paint and repainting the 

bridges with a zinc-rich moisture cure polyurethane paint system. 

These are just a few examples of how, in Hawaii, Recovery Act dollars are providing needed investments for our people and infrastructure. This is happening 

throughout the entire United States. The Recovery Act projects will save lives on 

our Nation’s highways, while strengthening the economy by helping our highway 

system move people and goods more efficiently and effectively. 

Discretionary Transportation Investment Generating Economic Recovery Grants 

In February, Department of Transportation (DOT) Secretary Ray LaHood announced the 51 award recipients of the $1.5 billion Transportation Investment Generating Economic Recovery (TIGER) Discretionary Grant Program that was provided in the Recovery Act for surface transportation projects of national, regional, 

or major metropolitan area significance. The DOT received over 1,400 TIGER Grant 

applications totaling nearly $60 billion. 

Hawaii received $24.5 million in TIGER funds for the reconstruction of Pier 29 

in Honolulu Harbor. In 2008, the Pier 29 container yard at the Honolulu Harbor 

suffered structural failures, displacing the international carrier that used it. The 

TIGER funds will be used to reconstruct Pier 29, adding approximately 12 acres of 

upgraded cargo yard while also increasing efficiency and safety in Honolulu Harbor. 

Reconstructing Pier 29 will allow the international carrier that was displaced to return to Pier 29. Reconstructing Pier 29 will reduce truck traffic on busy and congested roadways in downtown Honolulu near Piers 1 and 2 by moving much of the 

traffic west toward the reconstructed Pier 29. Because Pier 29 is closer to Nimitz 

Highway and the primary intermodal highway routes, reconstructing Pier 29 helps 

reduce fuel consumption and greenhouse emissions from cargo movements at Piers 

1 and 2 in the downtown Honolulu area. 
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TRANSPARENCY, ACCOUNTABILITY, AND RISK MANAGEMENT

FHWA has moved forward aggressively to fulfill the President’s commitment to 

transparency and accountability for Recovery Act funds. In Hawaii, the Division Office has been actively involved in assisting State and local partners to deliver the 

most challenging and complex projects in Hawaii’s Recovery Act program. The Hawaii Division Office has also carried out 20 project reviews and, in some cases, recommended procedural changes to improve the quality or efficiency of meeting a requirement. 

While FHWA has established 4 National Review Teams to carry out in-depth reviews in our identified risk areas across all 50 States and Puerto Rico, FHWA is 

depending on its Division Offices to carry out spot checks on the front lines of the 

agency’s risk management. As we move forward with Recovery Act implementation, 

we will continue to employ risk mitigation strategies to fulfill our mandate that 

these funds are prudently spent. 

CONCLUSION

At FHWA, we are mindful of the importance of ensuring the successful investment of highway dollars under the Recovery Act. In addition to the near-term employment impacts, these highway infrastructure investments will return economic 

benefits to Hawaii for many years to come. In the Hawaii Division Office, we are 

doing our part to work with HDOT to ensure that the State’s remaining Recovery 

Act funds are invested as quickly and effectively as possible. 

Mr. Chairman, thank you for the opportunity to appear before you today. I would 

be happy to answer your questions. 

PREPARED STATEMENT OF LAURA M. DIERENFIELD, CHAIR, SAFE ROUTES TO SCHOOL

NATIONAL PARTNERSHIP, HAWAII STATE NETWORK

Chairman Inouye, Ranking Member Cochran, and Members of the Committee: 

Thank you for hosting this open session on the ‘‘American Recovery and Reinvestment Act of 2009—Invest in Hawaii’’ program. We have many talented public and 

private sector leaders presenting here today who are working hard to make good 

use of ARRA funds. 

I represent a thriving coalition of bicycle and pedestrian advocates focused on restoring our keiki’s (children’s) most basic right to be safe and healthy in their own 

communities, reviving Hawaii’s economy, renewing bonds between family and 

friends, and building resilience into our energy and transportation systems through 

investments in pathways and bikeways that connect us all as a community to one 

another in safe, equitable and efficient manner. 

We have been actively engaged in advocating for the completion of key bicycle and 

pedestrian projects using Federal stimulus dollars as well as tracking FHWA funds 

through SAFETEA–LU and the HIRE Act as well as EECBG funds for transportation energy efficiency initiatives. It is in these two areas we wish to make comments and recommendations about how to best invest in the future energy security, 

livability, health and happiness of Hawaii’s people, especially our children. 

THE NEED FOR BICYCLE AND PEDESTRIAN INVESTMENTS IN HAWAII

As an isolated society in the middle of the Pacific Ocean, we must be able to move 

people and goods effectively to maintain a strong economic future. We also desire 

communities that allow people to live actively and safely as part of their daily life. 

We also have a kuleana (responsibility) to manage the impacts of infrastructure, energy consumption and emissions on the environment. For these reasons, transportation becomes a critical cornerstone of Hawaii’s economic viability, public health, 

and environmental sustainability. A balanced transportation network allows for the 

effective movement of people and goods, helps to reduce demand for expensive imported energy, enables healthy and active living, and preserves our natural environment by sharing mobility among many modes of transportation including driving, 

walking, bicycling and transit. 

Achieving an effective, healthy and sustainable balanced transportation network 

is not an easy task. Decades of transportation planning and land use have created 

a car-dominated culture that is becoming more and more expensive to maintain. Hawaii’s families spend more on transportation than on food or clothes, combined. 

Fully one-third of our residents do not drive due to age (too young or too old) or 

disability. Land use patterns have created neighborhoods separated from the workplace by severely congested freeways causing significant delays to and from work, 

school, shopping. Funding for roads and infrastructure is rapidly declining in these 
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difficult economic times and it will become increasingly difficult to judiciously distribute funding for roadways throughout our many isolated island communities. 

Resident and visitor car fuel demand accounts for nearly one-third of the expensive 

imported gas to Hawaii and fossil fuel burning vehicles emit the majority of the carbon pollution in our state. But perhaps most concerning is the rapid rise of obesity 

in our state, both in adults and children. Hawaii spends over $290 million each year 

treating diseases related to inactivity and poor nutrition. By designing our transportation network around the needs of a car, we have created communities that are 

unfriendly, and at times hostile, to walking or bicycling. Hawaii families must be 

very diligent in finding opportunities to exercise or finding places for kids to play. 

It is rare to be able to step out your front door and enjoy a walk with your spouse 

or a bike ride with your kids. 

Together, we as a community must thread the powerful strands of sustainable 

land use practices, wise transportation investments, diligent planning and thoughtful design together into a healthy tapestry of productive, active, sustainable communities. 

The ARRA program, through your leadership, Chairman Inouye, is the needle 

that is weaving these powerful strands together for the future of Hawaii’s people. 

And while Hawaii has been exemplary in seeking out and spending ARRA funds for 

transportation and energy projects, we continue to leave great opportunities on the 

table due to lack of internal leadership at the state and county levels to carry out 

these bicycle and pedestrian projects that carry such promise for energy security, 

natural resource preservation, healthy families and communities. 

We are increasingly concerned with the lack of a State Bicycle Coordinator and 

the understaffed Safe Routes to School (SRTS) program. This lack of leadership has 

kept Hawaii from fully capitalizing on ARRA funds and other FHWA funding for 

bicycle and pedestrian projects that are long overdue and have great promise for 

economic development, increased health and improved energy security. We can ill 

afford to keep these worthwhile dollars on the table, especially in a energy-vulnerable and tourism-driven economy like ours where transportation efficiency and safe, 

scenic routes are critical to maintaining energy security and a strong visitor industry. 

The State Bicycle Coordinator position itself is also highly undervalued at an 

entry-level position, prompting those who get the position to soon leave for a promotion with HDOT, as happened with the three Coordinators during my tenure in 

transportation advocacy over the last 7 years. We have been told for several years 

now that the HDOT is working on upgrading that status, but there never seems to 

be any progress on that front. 

In a similar vein, we understand that the 100 percent federal funded Safe Routes 

to School program is funded with two half-time staff in the Traffic Branch, and 

much of that work is left to one person who also handles van pool and other demanding programs. This important Federal program continues to languish and stall, 

denying schools and communities important funding for local jobs and long overdue 

infrastructure improvements. Schools that applied for these funds in 2007 are rapidly losing their in-kind community partners and their own will to continue to wait, 

now almost 3 years, for a notice to proceed with their projects. 

We want to be clear that the leadership at HDOT under Director Morioka has 

been exemplary in their openness to hear from groups like ours, and they have 

taken on some promising planning initiatives to advance pedestrian and bicycle infrastructure projects across the State. We applaud them on these efforts and we appreciate being involved. However these planning efforts will fall short without the 

internal leadership to carry out the plans. 

Our recommendation would be to upgrade the HDOT Bicycle Coordinator to a 

Senior Level Planner and conduct a legitimate national search for the position and 

fill it as soon as possible. We also feel that the SRTS program would be much better 

served with a full time SRTS Coordinator housed the Planning Branch of HDOT so 

that the SRTS Coordinator and the Bike Coordinator can work closely together to 

make best use of Federal stimulus dollars and Federal transportation aid. 

BICYCLING AND WALKING BELONG IN HAWAII’S CLEAN ENERGY FUTURE

Hawaii’s extreme energy vulnerability as isolated Pacific islands nearly wholly dependent on imported fuels, and abundant, but fragile, natural environment capable 

of harnessing the energy of wind, solar, wave and bio fuels, has positioned Hawaii 

as a magnet for alternative energy research. Federal, state and county leaders have 

recognized Hawaii’s energy insecurity and existing ‘‘natural capital’’ and have taken 

bold steps to make Hawaii a test bed for alternative fuel technologies, including 
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1 Hawaii Clean Energy Initiative, Information available at: http:// 

www.hawaiicleanenergyinitiative.org/. 2 RITA National Household Transportation Survey, 2001, Available at: http://www.bts.gov/programs. 3 Hawaii Business Magazine, February 2009. 

launching the Hawaii Clean Energy Initiative 1, an unprecedented partnership between the U.S. DOE and Hawaii that has brought expertise and leadership to solve 

Hawaii’s energy challenge as a model for the rest of the country. However, experts 

and existing stakeholders in the energy debate agree that true energy self-sufficiency cannot solely rely on alternative generation. Demand reduction through increased energy efficiency must also be a key component of Hawaii’s energy security 

strategy. 

Transportation accounts for the largest amount of energy utilization in the islands, with resident and visitor fuel demand accounting for one-third of imported 

oil. Aviation, shipping and commercial trucking industries are dependent upon these 

imports. Where we can make the biggest difference is in personal household trips, 

half of which are 5 miles or less.2 For these short trips, bicycling is a great choice. 

As an oil-free, simple (no expensive research and development required), independent (not constrained by a fixed transit schedule), inexpensive (affordable mobility for all) and off-the-shelf technology (ready to deploy now), bicycling should be a 

major component of Hawaii’s and of the United State’s energy self-sufficiency and 

green house gas reduction plan. 

Bicycling was once a viable transportation option in Hawaii. Eki Cyclery, still a 

profitable bike shop in Honolulu today, opened its doors in 1911 to ‘‘meet Honolulu’s 

growing demand for inexpensive, urban transportation’’.3 Many of Hawaii’s first bicycle plans were created following the oil shocks of the 1970’s. Unfortunately, once 

the oil prices fell and the long lines at the gas pumps dwindled, these plans were 

shelved to make way for a system almost entirely reliant on personal motor vehicles. Bicycling could be safe and efficient options again as they were in the early 

1900’s, especially for short trips, if the right combination of engineering, education, 

encouragement and enforcement practices were in place. 

We recommend that USDOE and DBEDT through the HCEI look at ARRA funds 

to accelerate planning, design and construction of existing bicycle and pedestrian 

projects in Bike Plan Hawaii, O’ahu’s Bicycle Master Plan and other county bicycle 

and pedestrian plans. 

PREPARED STATEMENT OF SUSAN MILLER

Mahalo for the opportunity to provide testimony: I am Susan Miller. I work on 

a federal funded Medicaid Infrastructure Grant (Hire Abilities Hawaii) at the University of Hawaii. The nature of the grant is removing barriers to employment for 

persons with disabilities, and building infrastructure to promote access to competitive employment pathways in Hawaii. 

I have good news and bad news to share regarding our stimulus spending in Hawaii. The bad news first: in all of the challenges we have faced as a state, including 

all of the budget cuts, the losses of jobs and services in state government, and the 

reductions in funding in critical areas, like education, we have been slow to spend 

our stimulus funding. I am here to tell you that in this tough environment, people 

with disabilities have not been adequately included in the stimulus funding for employment. 

The good news is that we still have time to include the disability community in 

our stimulus funding. Projects in the following areas still need funding: 

—Benefits education, which helps persons with disabilities to understand the impact on employment to their benefits so those who are able may join the workforce and give up their benefits. 

—Job Accommodations in public sectors, which is new to Hawaii, provides the 

technical support for people with disabilities to gain and retain employment. 

—Employment First, which will create ‘‘Yes We Can’’ environment for people with 

Development Disabilities in Hawaii, with an assumption that all people who 

wish to work can find a place in the job market, with the use of job coaching 

and supported employment. 

—Medicaid Buy-in, which if enacted in Hawaii, will enable people with disabilities 

to keep their Medicaid when they go to work, which will provide them with the 

level of healthcare needed for them to successful remain in the job market. 

—Transition for at-risk youth, including youth with disabilities, who are often left 

behind since the summer jobs program by Department of Labor is funded by 
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TANF, and TANF funds are prohibited from being used for people with disabilities. 

Let me repeat, there is still time to allocate funding toward programs that can 

serve people with disabilities. 

Mahalo again for the opportunity to give you my testimony. 

CONCLUSION OF HEARING

Chairman INOUYE. And the committee will stand recessed. 

[Whereupon, at 12:30 p.m., Wednesday, July 7, the hearing was 

concluded, and the committee was recessed, to reconvene subject to 

the call of the Chair.] 

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