(BIVN) - Governor Josh Green, M.D., gave his annual State of the State speech on Tuesday.
Speaking from a podium within the State House Chamber, Governor Green delivered his speech to a room full of state legislators, cabinet members and community leaders.
Most of the Governor's speech related to the economic challenges facing Hawaiʻi's residents, from the lack of affordable housing, to the high cost of living, to the challenges of homelessness.
Hawaiʻi island was only briefly mentioned during the Governor's speech, when he noted his request to the legislature to provide $25 million for the Keaʻau Outpatient Center, and over $44 million for improvements to Hawaiʻi Health Systems Corporation facilities to include the renovation of Kona Community Hospital's Emergency Department.
From the full speech as provided by the Office of the Governor:
First Lady, Lt. Governor, Madame Speaker, Senate President, OHA Chair, Chief Justice, colleagues, members of the cabinet, distinguished guests, and all the people of Hawai'i -- ALOHA.
Jaime, I couldn't do this job without you. Your support, your thoughtful perspective, and your hard work are truly valuable to me. Thank you. I love you very much.
Sylvia, thank you for your tireless work to improve Hawai'i -- specifically your extraordinary efforts on early education and broadband technology.
You have proven to be a great teammate and I truly appreciate you. Nadine, I am so excited to see you become our first woman Speaker of the House.
You have already shown me that you will help lead the House in a thoughtful way, and you will bring your own style to this important leadership role.
Ron and Kai, we served in the Senate together and I have so many great memories from that era.
I look forward to resuming our work together this year, in ways that will improve the lives of all the people of Hawai'i.
CJ, we honor you for your years of distinguished service to our state. I'm really going to miss you.
Legislative colleagues, thank you for being such great partners over the last two years in our work for the people.
I see new faces join our ranks, and it reminds me that we were all new once -- sometimes a fresh perspective leads us to even greater progress.
I also want to thank all of our cabinet members -- and our executive team led by my Chief of Staff Brooke Wilson -- who have done so much to advance our top priorities.
Mahalo to all of you for your leadership, and for coming together to take on our biggest challenges and to address the most important issues our state is facing.
We have been through some extremely difficult times in recent years -- the fear and uncertainty of the COVID pandemic, the devastating losses we suffered in the wildfires on Maui, and our long road of recovery and healing since that day.
By uniting as one 'ohana, we found in each other the faith, hope, and strength we needed to keep going and to rebuild.
Today, I am incredibly proud of our state and our people for the way we have come together to support each other through these enormous challenges.
Today, I am proud to report to you that the state of Hawai'i is strong!
Two years ago, I came into the governor's office after attending hundreds of talk stories and community meetings across our state, having thousands of conversations with people from every walk of life.
The people of Hawai'i spoke clearly -- they wanted to see real results on a number of issues that our state has been facing for years, but only seemed to be getting worse.
To my colleagues in the legislature and across state government, we are privileged to serve the people of Hawai'i and to work for them every day.
As we start a new year and begin a new legislative session, we reflect on the progress we have made together over the past two years, and to look forward and ask:
"What do the people of Hawai'i want us to accomplish for them now and in the coming years?"
AFFORDABILITY
First, let's talk about the cost of living in Hawai'i.
It's too high -- the highest in the country.
There are too many families struggling to make ends meet.
Too many people are forced to consider leaving the places they grew up in, and too many families have already left our state in search of a lower cost of living on the mainland.
Two years ago, the people of Hawai'i told us loud and clear that they want us to find ways to make living in our state more affordable.
From day one, we made it a top priority and we took action -- we lowered taxes.
In our first year, we worked with the legislature to double the earned income tax credit and the food tax credit, and to increase the existing child and dependent tax credit -- saving Hawai'i families about $88 million per year in taxes.
Then last year, the legislature passed -- and I signed into law -- the largest income tax cut for Hawai'i families in our state's history.
This tax cut will take effect in steps over the next seven years, providing an estimated $5.6 billion in total savings to our people.
It will reduce taxes from between 10 to 71 percent for working families, depending on household income -- moving Hawai'i from having the second-highest, to the fourthlowest tax burden in the country.
A family of four making the median household income of $88,000 in Hawai'i will see its take-home pay increase by more than $3,600 by 2031 when the tax reform has been fully implemented.
These tax cuts are already going into effect now, and by 2031 the number of Hawai'i households that will pay zero state income tax will rise from 25 to 40 percent -- keeping more money in people's pockets, and stimulating statewide economic growth.
Over the last two years, we also made careful budgetary decisions.
We reduced spending by $500 million in 2024 and $1 billion in 2023 without cutting needed services -- while maintaining $1.5 billion in our rainy day fund.
Our goal continues to be making our state more affordable, so local families can live in Hawai'i and our next generation can have a future here -- and in the coming years we will continue to find new ways to lower our cost of living.
HOUSING
Facing the highest housing costs in the nation, the people of Hawai'i also asked us to make housing more affordable and available across our state.
Housing is the single largest expense for Hawai'i families, accounting for 38 percent of household spending on average.
Even before fires destroyed nearly 4,000 homes on Maui in August of 2023, we faced an estimated shortage of 50,000 housing units statewide.
Hawai'i's building regulations have driven the cost of condominium development up by 58 percent -- making it the highest in the country.
Because of our lack of affordable housing, we also face a shortage of teachers and health care workers -- and more Native Hawaiians now live on the mainland than in our state.
We immediately approved 10,800 new units of low income housing for struggling
families.
Over the past 18 months, the exemptions established in our 2 emergency housing proclamations have helped approve or accelerate nearly 7,000 affordable housing units across our state.
We also worked closely with the legislature on this issue, and over the last two years we have delivered the most significant housing regulatory and zoning reforms in over 40 years -- cutting red tape, updating and improving rental laws, and increasing the affordable housing inventory statewide.
Our combined efforts are now paying dividends.
Affordable housing measures we passed over the last two years are now fueling a surge in workforce and low-income housing developments across our islands.
Right now, we are tracking more than 62,000 units over 257 projects being built by state and county agencies and private developers over the next decade -- with 13,000 new units to be completed this year and 10,000 more next year.
This includes 46,000 new units of affordable housing.
For the next two years, we have requested over $500 million for housing initiatives -- including $250 million for the Rental Housing Revolving Fund to develop more affordable housing, $30 million for Phase 2 of the 99-Year Leasehold Program on O'ahu, and $62 million for the University of Hawai'i West O'ahu infrastructure development for University Village near the rail.
We have also requested $68 million to transform Mayor Wright Homes, this effort will add more than 2,000 housing units for the district's working families.
With this same sense of urgency, the Department of Hawaiian Home Lands and its Chair Kali Watson are tackling the affordable housing crisis for Native Hawaiians.
More than two years ago the legislature approved Act 279, which appropriated a historic $600 million to DHHL to reduce its decades-long waitlist which has swelled to over 29,000 kānaka maoli.
Since then, DHHL has embarked on a bold five-year plan to deliver more than 7,500 homes and lots for Native Hawaiians.
This includes projects like Puʻuhona Homestead project in Wailuku -- the first residential DHHL project on Maui in nearly two decades -- which, when completed, will provide 137 turnkey homes and 24 improved lots.
It also includes the 23-story Hale O Mōʻiliʻili project at the former Bowl-o-Drome site, which will provide 278 much-needed apartments in Honolulu's urban core with rents starting as low as $657 per month.
Innovative projects like these will help provide new affordable housing for Native Hawaiians who have been on the waitlist for far too long.
But building alone won't solve our housing crisis.
In Hawai'i, we have too many short-term rentals owned by too many individuals who live on the mainland.
There are tens of thousands of housing units across the state that should not be short term rentals, they should be homes for our people.
Short-term rentals make on average four times what they would if the property were rented long-term to a local family -- and 52 percent of these short-term rentals in Hawai'i are owned by non-state residents, with 27 percent owning 20 units or more.
Currently, an estimated 75,000 of the 89,000 units in Hawai'i's short-term rental market are 'not legal' according to our existing laws.
So last year, after listening to community activists like Lahaina Strong on Maui, we passed legislation empowering the counties to reform short term rentals, returning thousands of housing units to the local market, increasing supply and bringing down prices.
In just two years, we have made significant progress on housing, but there is still more work to do to meet our pressing needs.
We will remain committed to creating more affordable housing for Hawai'i's nurses, teachers, firefighters, and all the working families across our state.