Hawaii Island Ohan A Case Study

This asset policy roadmap was formulated to mitigate the challenges facing the Hawaii Island Ohana such as the limited earning opportunities in the county, difficulties in building assets, and low economic performance facing the Hawaii islands. Asset building is defined as “a process that encourages people to accumulate, develop, and preserve all kinds of assets such as financial knowledge, access to credit, savings, investment, human and social assets” (County of Hawaii_ R&D, 2011).
The roadmap identified six comprehensive goals to help families move from just getting by to getting ahead for themselves and future generations. This includes:
1. Make work pay
• Encourage people to reduce dependent on welfare and start working
• Some policy
components under make work pay include:
• Using the self-sufficiency standard as the benchmark of measuring economic struggle rather than the Federal Poverty level
• Increase access to the Federal EITC
• Establish a refundable state EITC equal to at least 20% of the Federal EITC.
• Increase the income tax threshold without eroding the overall tax revenues
2. Teach asset-building
• Provide asset-building trainings and financial education that will encourage people to save, invest, and protect their hard-earned assets.
• Policy components include:
• Maximize financial education for youth
• Encourage partnership between financial institutions and schools
• Create public awareness of financial education
• Integrate financial education into the Department of Human Service programs
• Encourage financial education in the workplace (private/public)
3. Breakdown barriers to asset building
• Compress those unethical lending practices, market failures, lack of insurance, and disincentives in public policies that become barriers in asset building.
• Policy components:
• Reduce or eliminate work and savings disincentives (asset test) in public welfare programs
• Adopt the federal anti-predatory mortgage lending standards that will prevent lending institution’s excessive fees, equity strippings, risk-rate disparities, and excess foreclosures.
• Enact State Auditor’s recommendations on payday lending into law
• Free up trapped equity on Hawaiian Home Lands to encourage homeowners to borrow and make additional investment against their home equity.
• Ensure health coverage for all that could minimized medical bills.
4. Help people to
save
• Create incentives and support for savings for the low and moderate income earners
• Policy components:
• Improve and expand the Hawaii’s match savings IDA programs
• Promote and facilitate the use of EITC refunds for savings
• Encourage “opt out” rather than “opt in” retirement accounts
• State matches for college savings plans for low and moderate income families
• Create a Universal Children’s Savings Account
5. Help people start & own businesses
• It will help in job creation and benefit the whole economy
• Policy components:
• Effectively utilize Federal funding streams (TANF, Community Development Block Grant) to support microenterprise
• Support for Community Development Financial Institutions (CDFIs)
• Increase opportunities to support new Native Hawaiian businesses
• Allow unemployment benefits for time-specific Self-Employment Assistance (SEA) programs.
• Create and support an employee ownership center that will offer education, technical assistance and other resources to cooperatively owned businesses.
6. Help people buy homes
• Focus on demand-side strategies that will improve the ability of low-moderate income earners to compete for housing.
• Policy components:
• Support homeownership education and counseling
• Increase government funded first-time homebuyer assistance
• Provided extra support for IDAs intended for homeownership
• Develop and encourage employer-assisted housing programs
• Promote federal programs that support homeownership opportunities
• Explore alternative approaches to increasing the supply of housing