Today’s Star Bulletin says that EUTF is short $27 million. There is a $29 million shortfall and the state wants employees to pay. The problem with the EUTF is that it was under funded by the start. The EUTF had to increase benefits to compete with HSTA’s VEBA trust. While it had a mechanism to increase funding it was too small in just the first year and needed adjustment.
Only HMSA and Kaiser were large enough to bid on the contract. Smaller unions could not offer an alternative to their members. When Summerlin came into Hawaii the EUTF trustees voted to extend HMSA’s contract rather than allowing Summerlin to bid. I think that the legislature’s intent was not fully thought out. They were really negotiating from weakness. Are the state and the trustees guilty of malfeasance?
MBC had to declare bankruptcy. They say that there was a change in tax laws and reporting income. Because they were unaware of this now MBC has a shortage. I’m sorry but I cannot accept this simple explanation. There is a lot of blame to go around. Who is guilty of malfeasance? MBC’s director, MBC’s board, HSTA’s executive director, HSTA’s executive officers, HSTA’s board of directors, HSTA’s fiscal staff?
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