Senators urge local
produce be bought for
state programs

Legislature Directory

By Mike Yuen
Star-Bulletin

Even if it means paying more, Sens. Suzanne Chun Oakland, Colleen Hanabusa and Lorraine Inouye want government to be required to buy isle-grown fruits and vegetables for state school cafeterias, hospitals, prisons and other programs.

But Senate Government Operations Chairman Rod Tam of Pauoa said yesterday he is not inclined to establish the sort of local mandate that his three fellow Democrats are advocating. He will probably recommend that their bill be held in his committee, he said.

With one exception, testimony went against the measure, Tam noted.

Chun Oakland (Liliha), Hanabusa (Waianae) and Inouye (Hilo) also want to establish a state policy to favor local products and services in government procurement.

Already written into state law is a 7 percent bid preference for isle contractors, which means they can win a public-works contract even if their proposal is 7 percent higher than the lowest bid. Sen. Cal Kawamoto (D, Waipahu), chairman of Senate Transportation and Intergovernmental Affairs, wants to raise the local preference back to 15 percent, as it was a few years ago.

"The state," said procurement Administrator Lloyd Unebasami, "currently has eight local preferences covering goods, services and construction, which are the most in the nation."

Gene Kaneshiro, director of the lunch program for the state public schools, said the School Food Services Branch encourages its cafeterias to purchase locally grown produce, but at the same time it must also consider cost and quality.

"As a state agency, I don't think we can subsidize (local) farmers unless you give us more money," Kaneshiro said.

But he wondered why lawmakers would want to do that, given the state's tight budget, said Kaneshiro, whose lunch program serves 150,000 students every school day.

Kaneshiro added that since the cafeterias are federally funded and require an open-bid process for all U.S.-grown produce, the Department of Education could run afoul of the federal government if it is forced to buy local no matter what the cost.

Unebasami testified: "To select a local vendor over an out-of-state vendor regardless of price will cost the government and public more money. Preferences are not a good procurement practice, as they increase the cost of products or services, decrease competition and are costly to administer."

In written testimony, the 23,000-member International Longshore and Warehouse Union, Local 142, said that requiring the state to purchase local fruits and vegetables no matter what the cost is a way to support local products and labor.

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Lawmakers want more
money for Medicaid

Star-Bulletin

WASHINGTON -- Shrugging off last year's rebuff, Hawaii's congressional delegation is again trying to increase federal Medicaid payments to the isles.

The lawmakers yesterday introduced legislation in both the House and the Senate that would increase payments to Hawaii by an estimated $63 million a year by temporarily revising the formula on which reimbursement rates are based.

Similar legislation was introduced in Congress last year but got little support.

Medicaid payments to states are based on per capita income. Since Hawaii's per capita income is relatively high, the state's reimbursement rate for Medicaid is relatively low.

But Hawaii also has a high cost of living, which is taken into account for payments in some federal programs (food stamp allocations and school lunch programs, for example), but not Medicaid. Ignoring the high cost of living artificially inflates Hawaii's ability to pay Medicaid costs, according to the delegation.

"It's a matter of simple fairness," said Rep. Neil Abercrombie, D-Honolulu. "The Medicaid payment formula should be increased to reflect Hawaii's high cost of living."

Two years ago, Congress increased Alaska's reimbursement rate, based in part on its high cost of living.