Senate committee amends wildfire settlement bill to require defendants' payment plans and escrow

The Senate committee on Intergovernmental Affairs passed House Bill 1001, HT1, SD1 on March 18 after adopting amendments meant to secure payment from private defendants in the proposed Maui wildfire settlement.

Why it matters: HB1001 funds the state's contribution to a proposed Maui Wildfire Settlement Trust Fund. Committee members said they were concerned about the mechanics for ensuring that other defendants — including utilities and private entities named in the settlement — actually have and will produce the funds they agreed to pay.

Testimony and financial questions: Will King of the Governor's Office testified in strong support of the bill, and Deputy Attorney General Lee Saffenu said the department filed supportive written comments. Scott Seay, president and CEO of HEEI, testified about Hawaiian Electric's plan to fund its portion of a multi-billion-dollar obligation using a mix of debt and equity; he said the company had raised funds to cover the first installment and expected to use future debt and equity sales for later installments.

Members pressed for more certainty. A senator asked whether contributors could phase their payments to align with the utility's installments; HEEI's representative confirmed installment options were available to contributors but deferred to the settlement agreement for specifics. Committee members repeatedly requested evidence of defendants' capacity to pay and clearer mechanics to prevent the state from paying first while private parties lagged.

Amendments adopted: The chair offered two substantive amendments that the committee adopted: (1) require each defendant party in the settlement to submit a written plan and evidence of its ability to pay its share as payments become due, to the Attorney General's Office for review; and (2) require that defendant parties (not the state) deposit their share of each installment into an escrow overseen by the Attorney General 30 days prior to each payment due date, and that the state will not release its funds until those deposits are confirmed. The chair said the changes were intended to make the state the last party to pay to ensure others fulfill their commitments.

Clarifying figures on the record: Committee members referenced figures discussed in testimony: the bill contemplates the state contributing roughly $800 million (split in two $400 million tranches in the bill text); witnesses discussed private defendant commitments including a utility's reported $2 billion obligation and the utility describing set-asides and expected proceeds (testimony referenced $479 million set aside for the first payment and anticipated proceeds of about $523 million from a cited program). Witnesses cautioned that some details in the settlement agreement and the timing of court approval remained unresolved.

Committee decision and next steps: The committee voted to pass HB1001 with the two amendments requiring payment plans and escrow. The chair recorded an affirmative vote and the committee's recommendation was approved. Members directed that the suggested escrow and reporting language be coordinated with parties involved in the negotiations and the Attorney General's Office.

What remains unresolved: Committee members asked staff to follow up on which lawsuits and other wildfire-related costs the settlement would or would not cover, and whether the settlement mechanics allow installment-matching across defendants. Several members requested follow-up responses from the Attorney General's Office and defendant parties about payment schedules and escrow feasibility before final enactment.