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Committee defers decision on performing arts grant bill after legal and funding concerns
Summary
The committee postponed decision on HB 1378, which would create a performing arts grant program administered by the State Foundation on Culture and the Arts, after the foundation requested general‑fund support for staff and the attorney general warned that expanding a special fund’s uses could jeopardize tax‑exempt bond status.
The House Committee on Culture, Arts & International Affairs deferred decision on House Bill 1378 on Friday after testimony raised questions about funding sources and potential legal risks to a state special fund.
House Bill 1378 would establish a performing arts grant program administered by the State Foundation on Culture and the Arts (SFCA). Karen Ewald, executive director of the SFCA, testified in support and asked for a general‑fund appropriation for performing arts and for an amendment to shift 4.5 full‑time equivalent (FTE) positions from federal funds to general funds to protect federally funded positions that currently support the foundation’s work. Ewald said the SFCA currently has 0.5 FTE in general funds.
Deputy Attorney General Alyssa Marie Kao advised the committee to delete Section 5 of the bill, which the foundation and other testimony showed would expand the use of the Works of Art Special Fund to include performing arts. Kao said the Works of Art Special Fund is funded by tax‑exempt GEO bonds and that expanding eligible uses could risk the bonds’ tax‑exempt status. Kao said that, if the committee wished to expand the fund’s use to performing arts, it should instead add a dedicated section in chapter 9 that clearly defines the fund, its administration by the foundation and the revenues included; she noted recommended language on page 3, line 15 of the bill packet.
Representatives from the Department of Business, Economic Development, and Tourism offered comments on the measure, and several nonprofit and community performers spoke in support. Kai Johnson of the Castle Performing Arts Learning Center said the organization is underfunded, describing a canceled show that students later funded themselves. Committee staff reported about 23 individuals and multiple performing arts organizations submitted testimony in support, including Maui Pop Orchestra, Iona Contemporary Dance Theater, Prince Dance Company and Hawaii Theater Center.
Because of the legal concerns raised by the attorney general and the funding and staffing requests from the SFCA, the committee deferred decision making on HB 1378 until Wednesday, Feb. 12, to allow the parties and staff to resolve outstanding issues.
The committee did not record a formal vote on the measure during Friday’s session.
