STAND. COM. REP. NO.  932-10


Honolulu, Hawaii

                , 2010


RE:   H.C.R. No. 219

      H.D. 1





Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2010

State of Hawaii




     Your Committee on Human Services, to which was referred H.C.R. No. 219 entitled:




begs leave to report as follows:


     The purpose of this concurrent resolution is to establish a Legislative Task Force to evaluate the proposed reorganization of the Benefits, Employment, Support Services Division (BESSD) and the Med Quest Division.


     The State Council on Developmental Disabilities, the Hawaii Government Employment Association (HGEA), the National Association of Social Workers (NASW), and a concerned individual submitted testimony in support of this measure.  Another concerned individual submitted comments.


     Your Committee recognizes that due to the current economic landscape, more and more Hawaii residents are financially struggling.  In turn, they are seeking assistance from their government and looking to social welfare for that help.


     However, your Committee is concerned that this reorganization will likely result in fewer people receiving benefits and hurt those greatest in need.  Under this proposed plan, eligibility offices and local community units will be replaced by two processing centers in Honolulu and Hilo.  This will result in at least 232 DHS employee layoffs and an overworked, understaffed workforce.


     Therefore, your Committee has amended this concurrent resolution by:


          (1) Inserting language to further document possible                     difficulties of the proposed reorganization:


          A.   WHEREAS, the eligibility offices and community                 units will be replaced by two processing                       centers in Honolulu and Hilo to handle all                     applications and the work previously done in                  local offices and units; and

              B.   WHEREAS, it is doubtful that non-profit social                 service organizations can assist in the event                  that there are problems with this policy                       proposal since they are already struggling to                 serve their existing clients; and

              C.   WHEREAS, the Chief Investigator of the DHS                     Investigation and Restitution office, as well                 as a Deputy Prosecutor from the island of                        Hawaii both testified that the EPOD plan would                   result in rampant welfare fraud as the “checks                    and balances” currently in place would be                        eliminated, primarily due to the fact the                     front line eligibility workers are required                         witnesses to prosecute welfare fraud; and

              D.   WHEREAS, due to the increase in welfare fraud,                 millions of dollars in court ordered                           restitution that the State of Hawaii receives                 would be lost; and

              E.   WHEREAS, the DHS Director is rushing to                        implement the EPOD by July 2010 even though                        there is strong precedent that similar call                        center schemes have failed miserably in other                 states such as Florida, Oregon, Indiana and                      Texas, resulting in tremendous suffering by                      needy clients not being able to access                             available Federal assistance programs; and

              F.   WHEREAS, the Florida model, which the proposed                 EPOD proposal is modeled after, took over two                  years to implement; and

          G.   WHEREAS, Florida was the 43rd ranked state for                  food stamp participation after their system                        converted to call centers; and

              H.   WHEREAS, testimony was received regarding the                  Oregon model by a former recipient who stated                  that the Oregon public assistance program was                 a terribly inadequate and inefficient system;                   furthermore, this recipient and their child                       was denied assistance they were lawfully                    entitled to; and 

          I.   WHEREAS, although eligibility offices remained                 open in each respective Oregonian county, the                  program was fraught with worker errors,                       dropped calls and major delays; and

              J.   WHEREAS, Hawaii has a proven community                             assistance model that has won Federal cash                     awards for the State of Hawaii by providing                        timely and accurate assistance to the needy                        population for the past 42 years; and

              K.   WHEREAS, Hawaii was recognized for outstanding                 service and accuracy in SNAP between 2003                      through 2008; and

              L.   WHEREAS, to date over 6,300 DHS employees and                  clients have submitted signed petitions                        stating that they have “no confidence” in the                 DHS Director’s ability to properly administer                 the mission of the department; and

              M.   WHEREAS, the State of Hawaii House of                          Representatives Finance Committee has reduced                  the Governor’s DHS budget by 18,521,400                       million dollars, and protected DHS positions                 the Governor wanted to eliminate that provides                    essential community assistance services to                       over 300,000 needy Hawaii residents; and

          N.   WHEREAS, the DHS Director, as of the current                   date, has not provided an operational EPOD                     implementation plan, as well as a contingency                 plan in the event EPOD meets with catastrophic                    failure; and


          (2)  Adding PHOCUSED to the task force


          (3)  Adding an appropriate agency, as determined by the             Legislature, to staff the task force


          (4)  Making technical, nonsubstantive amendments for                     clarity, consistency, and style


     As affirmed by the record of votes of the members of your Committee on Human Services that is attached to this report, your Committee concurs with the intent and purpose of H.C.R. No. 219, as amended herein, and recommends that it be referred to the Committee on Finance in the form attached hereto as H.C.R. No. 219, H.D. 1.



Respectfully submitted on behalf of the members of the Committee on Human Services,