Hawaiʻi lawmakers are inviting nonprofit organizations to seek extra state grant funding under a $50 million initiative to offset recent federal cuts to health and human services programs.
In an unusual move, the money will be doled out by a four-member panel instead of the full Legislature.
Legislators authorized the extra grants-in-aid funding in the closing days of the last session amid concerns the Trump administration would impose deep cuts in social service programs. Gov. Josh Green approved that plan as Act 310.
Hawaiʻi nonprofits “are facing unprecedented delays and reductions in federal funding,” according to an announcement issued by lawmakers this week. “The cuts in federal funding have impacted areas such as healthcare, human services, education, homelessness, and food security.”
In an effort to make up for lost federal funding, the state has begun accepting applications for the Act 310 grants, with a deadline for the nonprofits to submit applications of 4:30 p.m. on Oct. 24.
Act 310 says nonprofit applicants for the state grants must be “recipients or providers that have sustained a reduction or termination of their federal funding,” or primarily serve populations that were “negatively affected by reductions or terminations of federal funding.”
The $50 million is in addition to $30 million lawmakers directed to nonprofits under the regular grant-in-aid process during the legislative session last spring.
A recent report by the University of Hawaiʻi Economic Research Organization concluded 74 federal grants to 59 Hawai‘i nonprofits “are politically vulnerable” to budget cuts by the Trump administration. Programs serving Native Hawaiians account for much of that risk.
Those nonprofits are awaiting $126 million in unpaid balances on federal grants, and “more than half of this risk is concentrated in healthcare programs, with significant exposure also in human services, environment, and education,” according to the UHERO report.
But it isn’t clear yet how much funding or how many grants to local nonprofits have actually been cut.
State Rep. Daniel Holt, who oversees nonprofit grant-in-aid awards for the House, said in an interview Wednesday he was unaware of any local nonprofits that have taken a big financial hit from federal cuts.
“We don’t know what to expect,” Holt said of the application process.
“We don’t know if we’re going to get overwhelmed, we don’t know if we’re going to have a lot of extra money,” he added. “We honestly have no idea at this point.”
The applications will be administered by Aloha United Way, and a panel of four Democratic legislators will decide the amounts awarded to each nonprofit.
Those lawmakers include Holt, House Finance Committee Vice Chair Jenna Takenouchi, Senate Ways and Means Chair Donovan Dela Cruz and Senate Majority Leader Dru Kanuha.
Act 310 has been criticized by some lawmakers because it empowers just those four legislators to decide which nonprofits will get portions of the $50 million. Grants-in-aid are normally part of state budgets approved in votes by the full Legislature.
Other critics pointed out lawmakers exempted that four-member panel from the state public meetings or Sunshine law, raising concerns the awards to the nonprofits could be decided in secret.
Holt said the panel plans to meet publicly after all of the applications are received to hear the nonprofits present their requests for funding.
The panel will then meet privately to develop a list of awardees, then will approve that list in a public vote, he said. That process is similar to the way regular grants-in-aid are decided, except that under Act 310 only four lawmakers will be voting.
Public First Law Center Executive Director Brian Black warned in July there were procedural defects in the adoption of Act 310 that “threaten to invalidate any grants awarded by the committee.”