When Hawai`i Insurance Commissioner J.P. Schmidt met with the Hawai`i Bar Association's Insurance Coverage Section on July 1, 2009, [see post here] he advised the State was considering use of the Hurricane Relief Fund to help close the budget deficit.

    Today's Honolulu Advertiser reports that this option is still under serious consideration by the Governor and legislators.  [story here].  In today's article, Commissioner Schmidt warns that if a hurricane hit Hawai`i and private insurance companies restricted coverage, the fund's $185 million would not be enough to cover losses.  With some wisdom, the Commissioner is quoted as stating, "it is better to have the money available than to start over from scratch." 

    One tactic being discussed is utilizing a paper transaction to commit the Hurricane Relief Fund toward the budget deficit but leave it intact in case of a hurricane.  The Advertiser reports that such a scenario would allow the budget to be balanced on paper in hopes the economy will improve and the hurricane money will never actually be lost.