The written testimony below was presented Oct. 27, 2022, by Jonathan Helton, policy researcher for the Grassroot Institute of Hawaii, for consideration by the Hawaii County Cost of Government Commission.
The testimony concerned the commission’s October 2022 report, which made recommendations on how to improve county government operations.
Also during the commission’s meeting, Joe Kent, Grassroot Institute of Hawaii executive vice president, presented oral testimony on the same topic, which you can see here.
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To: The Hawaii County Cost of Government Commission
From: Jonathan Helton
Policy Researcher
Grassroot Institute of Hawaii
RE: item 3, Hawaii County Cost of Government Commission, October 2022 report.
Comments only
Dear Chair and Commission Members:
On behalf of the Grassroot Institute of Hawaii, I would like to offer comments on the County of Hawaii Cost of Government Commission’s October 2022 report.[1]
The Institute applauds the report’s recommendation that the Hawaii County Council consider using exceptions to the so-called Konno decision so it can more effectively improve and operate the county’s wastewater infrastructure.[2]
As you know, the Hawaii Supreme Court decided Konno v. County of Hawaii in 1997. The case concerned former Hawaii County Mayor Stephen Yamashiro’s attempt to close a public landfill and replace it with a new landfill staffed with private sector workers.[3]
The court held that Yamashiro’s action violated state law, and the state Legislature later adopted additional legislation making it even harder for the state and counties to hire private sector employees for jobs that are “customarily and historically” provided by civil servants.[4]
Through the years, however, the Legislature has created exemptions to this general rule.
Section 76-77 of the Hawaii Revised Statutes lists 16 exemptions the counties can use to hire workers outside of the civil service system.[5] Many of these apply to political or executive branch offices, but others are more wide-ranging, including:
>> “Special or unique” services that are “essential to the public interest” and cannot be filled by civil servants. Such services cannot be performed for longer than one year.
>> Internships for students.
>> Work performed by individuals with mental disabilities.
>> Certain part-time contractors.
Beyond those, the counties are free to hire outside the civil service system for jobs that have not been “customarily and historically” provided by civil servants.
In the instances when state and county agencies have used these exceptions to hire private sector employees, private sector employees have provided critical services.
For example, and as the Commission report notes, the Honolulu Water Reclamation Facility — a water recycling operation on Oahu that reclaims 12 million gallons of used water daily — is operated by Veolia, a global waste and energy company, and staffed by private sector workers.[6]
Here on Hawaii island, the state Judiciary has used private janitorial services in the past. These services have been provided by nonprofit organizations that assist individuals with mental disabilities in work training — a win for both the state and the individuals who are employed.[7]
The point of hiring private sector workers is to help public agencies deliver critical public services at a high level of quality but at the least possible cost. As University of Hawaii law professor David Callies and law clerk Adrienne Suarez noted in 2005, privatization can “benefit governments struggling to provide as many services at as little expense as possible.”[8]
In 2019, the Grassroot Institute produced a policy brief, “How to revive contracting as a policy option in Hawaii,” recommending that the Legislature adopt legislation making it easier for the state and counties to hire private staff.[9]
We continue to urge relaxation of those restrictions, based on extensive research and many real-life examples showing that private sector staff can provide meaningful benefits to Hawaii residents and taxpayers.
Until the Legislature can change existing law, we support Hawaii County’s efforts to utilize the Konno exemptions.
In this time of high inflation and staffing shortages, this outside-the-box solution is exactly what Hawaii County needs.
Thank you for the opportunity to testify.
Jonathan Helton
Policy Researcher
Grassroot Institute of Hawaii
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[1] “Agenda,” County of Hawaii Cost of Government Commission, Oct. 20, 2022.
[2] “Report of the Cost of Government Commission,” County of Hawaii, October 2022, pp. 11-13.
[3] Konno v. County of Hawaii, Supreme Court of Hawaii, 1997, 937 P.2d 397.
[4] Charleen M. Aina, Hawaii Attorney General Legal Opinion 97-06, Sept. 2, 1997.
[5] 2021 Hawaii Revised Statutes, 76-77 Civil service and exemptions. A similar list of exemptions exists for state bodies in 2021 Hawaii Revised Statutes, 76-16 Civil service and exemptions.
[6] “Innovative Technology at Honolulu’s Reclamation Plant,” Veolia, accessed Oct. 26, 2022.
[7] Joe Kent, “State’s use of contractors just a hint of what could be,” Grassroot Institute of Hawaii, March 8, 2019.
[8] David Callies and Adrienne Suarez, “Privatization and the Providing of Public Facilities through Private Means,” Journal of Law & Politics, Vol. XXI, 2005, p. 485.
[9] Aaron Leif, “How to revive contracting as a policy option in Hawaii,” Grassroot Institute of Hawaii, March 2019, pp. 5-8.
