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Hawaii Businesses Face Altered Crisis Response Framework as Emergency Powers Legislation Advances

·7 min read·⚡ Act Now

Executive Summary

New legislation proposes significant checks on gubernatorial emergency powers, potentially impacting business continuity and disaster response strategies. If enacted, businesses should proactively review and adapt their operational resilience plans before future crises.

  • All Sectors: Reduced gubernatorial discretion in declaring and managing emergencies may mean slower or more complex response protocols.
  • Small Businesses & Entrepreneurs: Preparedness and recovery plans may need adjustments to account for potentially less centralized or swifter state intervention during disasters.
  • Tourism Operators: Potential for more localized or prolonged impacts if statewide, rapid response measures are curtailed.
  • Real Estate Owners: Long-term planning for infrastructure resilience may become more critical if state emergency resource deployment is less certain.
  • Agriculture & Healthcare: Dependency on expedited state support for critical supplies or infrastructure during crises could be affected.
  • Action: Review and revise operational, disaster preparedness, and business continuity plans to reflect a potentially more constrained emergency response environment.

Action Required

High PriorityWhile legislative processes can be lengthy, businesses should monitor progress and begin assessing potential impacts on their operational plans.

If enacted, this legislation could change the framework for disaster response and business continuity planning, requiring strategic adjustments.

All affected roles should immediately review and revise their operational and business continuity plans. Focus on enhancing on-site resilience, diversifying supply chains, updating contingency plans with simulations of delayed external support, and reviewing insurance coverage for prolonged business interruption. Monitor legislative progress for enacted changes.

Who's Affected
Small Business OperatorsReal Estate OwnersTourism OperatorsEntrepreneurs & StartupsAgriculture & Food ProducersHealthcare Providers
Ripple Effects
  • →Reduced gubernatorial discretion in emergencies → Slower statewide disaster response → Prolonged business disruptions and higher local unemployment
  • →Less centralized emergency resource deployment → Increased reliance on private sector resilience measures → Higher operational costs for businesses
  • →Uncertainty in crisis management → Greater demand for private insurance and self-funded contingency planning → Amplified cost of doing business in Hawaii
Firefighters using a power tool to cut through smoke-filled building exterior.
Photo by Walter Leininger

Legislation to Restrict Gubernatorial Emergency Powers Moves Forward

Lawmakers in Hawaii are advancing legislation aimed at curbing the broad emergency powers historically vested in the governor. House Bill 2094 and Senate Bill 2943, both introduced in the 2024 legislative session, propose to introduce greater legislative oversight and limitations on the duration and scope of emergency proclamations. While the specifics are still under debate, the core intent is to prevent potential overreach and ensure that emergency declarations are subject to more robust checks and balances before and during their implementation. This shift could fundamentally alter the operational landscape for businesses that rely on swift, decisive state action during times of crisis, such as natural disasters, public health emergencies, or other unforeseen events.

The bills aim to achieve this by requiring legislative approval for extensions of emergency periods beyond a certain threshold (often 60 days), mandating more detailed reporting from the executive branch, and potentially establishing independent review boards. The implications for Hawaii's economy, which is particularly vulnerable due to its geographic isolation and susceptibility to natural events, could be substantial. Businesses will need to recalibrate their understanding of state-level support and their own internal preparedness strategies.

Who's Affected

Small Business Operators (Restaurants, Retail, Services, Franchises)

Small businesses are often the most vulnerable during and after disasters. Historically, emergency proclamations have allowed for rapid deployment of resources, temporary regulatory adjustments (e.g., for outdoor dining), and direct aid. If these powers are curtailed, businesses may face:

  • Slower Recovery Support: Less ability for the state to quickly implement supportive measures like streamlined permitting for repairs, temporary business operation waivers, or direct financial assistance distribution.
  • Increased Planning Burden: Operators will need to invest more in their own self-sufficiency and private contingency planning, as reliance on immediate, broad-stroke state interventions may diminish.
  • Potential for Prolonged Disruption: Without the governor's ability to quickly impose or lift restrictions statewide, localized or sector-specific disruptions could potentially last longer.

Real Estate Owners (Property Managers, Developers, Landlords)

Property owners and developers are directly impacted by regulations and infrastructure support during crises. Reduced emergency powers could lead to:

  • Altered Infrastructure Resilience Investments: Developers and owners may need to undertake more robust, self-funded resilience measures for properties, as state-led rapid infrastructure repair or reinforcement during emergencies might be less assured or slower.
  • Complex Permitting for Post-Disaster Rebuilding: Expedited permitting processes currently enabled by emergency declarations could become more bureaucratic and time-consuming, delaying recovery and rebuild efforts.
  • Shifts in Insurance and Risk Assessment: The perceived risk profile of properties may change, potentially influencing insurance premiums and investment decisions if state-level disaster response capacity is perceived as reduced.

Tourism Operators (Hotels, Tour Companies, Vacation Rentals)

Hawaii's economy is heavily reliant on tourism, making its operators sensitive to any changes in crisis management. Curtailed emergency powers could mean:

  • Less Predictable Operational Environments: The ability to quickly scale operations up or down, or to receive support during disruptions (e.g., flight cancellations due to a major event), might be less straightforward.
  • Potential for Inconsistent Localized Responses: If emergency responses become more fragmented or require legislative action, regions heavily dependent on tourism might experience uneven recovery or persistent disruption.
  • Impact on Visitor Confidence: Perceptions of Hawaii's ability to manage and recover from emergencies could influence booking decisions. A slower or more complex response framework might negatively impact this confidence.

Entrepreneurs & Startups

Startups, often operating with lean resources, depend on a stable operating environment. Changes to emergency powers legislation could affect them by:

  • Increased Operational Risk: Without the potential for swift executive action to mitigate widespread disruptions (e.g., internet outages, supply chain shocks), startups may face higher risks to their continuity.
  • Challenges in Scaling: Uncertainty around future crisis responses could make scaling operations more challenging, particularly for businesses reliant on predictable infrastructure and supply chains.
  • Dependency on Private Sector Resilience: Entrepreneurs will need to prioritize building significant internal resilience and contingency funds, as external support during crises might be less immediate or comprehensive.

Agriculture & Food Producers

This sector is particularly sensitive to environmental conditions, water rights, and supply chains, all of which can be severely impacted by disasters.

  • Water and Land Use Uncertainty: Emergency powers have sometimes been used to reallocate water resources or adjust land use regulations temporarily. Future limitations could complicate these adaptations.
  • Supply Chain Vulnerability: Reliance on expedited logistics and waivers for transportation during disruptions may be reduced, increasing the risk of spoilage and loss.
  • Focus on Localized Preparedness: Farmers and producers may need to focus more heavily on on-site storage, water management, and localized distribution networks rather than external emergency support.

Healthcare Providers (Clinics, Practices, Telehealth)

Healthcare systems are critical during emergencies, and their operational capacity depends on state support and resource availability.

  • Resource Acquisition Challenges: Expedited procurement of medical supplies, staffing support, or temporary facility arrangements currently facilitated by emergency powers might face more hurdles.
  • Telehealth and Licensing Flexibility: Emergency proclamations have often allowed for temporary waivers of licensing requirements or expanded telehealth capabilities. Future legislation could limit this flexibility, potentially impacting access to care.
  • Increased Burden on Existing Infrastructure: If state-level emergency response coordination is less robust, healthcare facilities may bear a greater load in managing patient surges and resource allocation independently.

Second-Order Effects

Curtailing broad gubernatorial emergency powers could trigger a cascade of effects in Hawaii's constrained island economy. A primary ripple effect is the potential for slower, more localized disaster recovery. If the governor cannot unilaterally implement statewide measures or deploy resources rapidly, recovery could become subject to the slower pace of legislative review or inter-agency coordination. This could lead to prolonged business disruptions, particularly for vulnerable sectors like tourism and small businesses, resulting in cascading unemployment spikes and reduced consumer spending. Consequently, the demand for private sector resilience solutions (e.g., backup power, on-site water storage, robust business continuity planning) is likely to increase, potentially driving up operational costs for businesses that can afford these measures, thereby widening the gap between resilient and vulnerable enterprises. Furthermore, a less certain or slower state-level response could necessitate increased private insurance coverage and self-funded contingency planning, adding to the already significant cost of doing business in Hawaii.

What to Do

Action: Review and Revise Operational and Business Continuity Plans

For All Affected Roles: The most critical action is to proactively reassess current disaster preparedness and business continuity plans. Given that the specifics of any enacted legislation are yet to be finalized and legislative processes can be protracted, the immediate priority is not to await specific policy changes but to anticipate a future environment where state emergency response might be more constrained or take longer to mobilize.

Specifically:

  1. Identify Critical Dependencies: Map out your business's absolute essential functions, supply chains, and critical infrastructure (e.g., power, internet, water, key personnel). Assess their vulnerability to prolonged disruption.
  2. Enhance On-Site Resilience: Explore options for increasing on-site resilience where feasible. This could include investing in backup power generators for essential equipment, enhancing water storage capacity, or securing redundant communication systems.
  3. Strengthen Supply Chain Diversification: If not already diversified, work to identify and establish relationships with secondary suppliers, particularly for critical inputs, to mitigate risks associated with single points of failure.
  4. Update and Test Contingency Plans: Ensure your business continuity and disaster recovery plans are up-to-date. Conduct regular drills and tabletop exercises with key personnel to simulate various crisis scenarios and test the efficacy of your plans. Pay particular attention to scenarios involving delayed external support.
  5. Review Insurance Coverage: Consult with your insurance providers to ensure your current policies adequately cover prolonged business interruption, property damage, and potential increases in operational costs during and after a crisis.
  6. Monitor Legislative Developments: While taking proactive steps now is paramount, continue to monitor the progress of HB 2094 and SB 2943, as well as any accompanying regulatory changes, to understand the precise nature of any new limitations on emergency powers. Stay informed about the effective dates of any enacted legislation.

By taking these steps now, businesses can build a stronger foundation of resilience, better prepared to navigate future challenges regardless of the specific framework of state emergency response. The window of opportunity to proactively adjust plans before potential legislative changes are enacted and a future crisis strikes is open, but the time to act is now to mitigate future risks.

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