RELATING TO WILDFIRES.

HB982

HOUSE OF REPRESENTATIVES

H.B. NO.

982

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

relating
to wildfires
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

����
SECTION 1.
�
The
legislature finds that as the risk of catastrophic wildfires in Hawaii has
increased, so has the threat of property damage from these fires.
�
The legislature further finds that the public
interest is served by providing a rapid, efficient, and low-cost process for
property owners, renters,
businesses
, and
their insurers to obtain compensation if a regulated utility is alleged to have
caused or contributed to the damage resulting from a catastrophic wildfire.
�
The legislature also finds that under existing
law, individuals and businesses must pursue civil litigation, which is a
lengthy, costly, and contentious process.

����
This Act would help individuals and businesses recover by giving
them the
option
to obtain payment quickly
through an administrative claims process similar to the One Ohana Fund, also
known as the Maui Wildfires Compensation Fund.
�

The administrative claims process will begin based on a preliminary
determination that a utility was involved, without waiting for the conclusion
of a comprehensive investigation of the origin and cause of a catastrophic
wildfire.
�
Claimants are not required to
prove
that the regulated utility was negligent in order to receive
payment through the administrative claims process.

����
This
Act
:

����
(1)
�
Preserves claimants' right to pursue
litigation if they choose to reject the amount offered through the
administrative claims process;

����
(2)
�
Limits the total amount that can be paid for
property damage through both the administrative claims process and litigation,
balancing the interests of those affected by a catastrophic fire in obtaining
compensation and the interests of the public utilities in mitigating the risk
of financial instability that can result from unlimited liability;

����
(3)
�
Requires the public utilities commission to
review the conduct of the public utility and to order the utility to replenish
the fund, up to a cap, if it finds that the utility acted imprudently; and

����
(4)
�
Provides for the legislature to re-evaluate
the risk of catastrophic wildfires in 2035 and to refund to customers the
amounts they contributed, plus earnings on those funds, to the extent the
legislature concludes that the size of the fund can be reduced based on actions
taken to reduce risk.

����
The legislature also finds that the public interest is served by
establishing a compensation mechanism that does not expose regulated utilities
to the financial instability that can result from the existing litigation
process.
�
Regulated utilities that may be
alleged to have caused a catastrophic wildfire face massive costs from
litigation.
�
Those costs can overwhelm
those utilities, undermining their ability to make investments that the State
needs.
�
Indeed, even the possibility of
litigation regarding a future
catastrophic

wildfire can create a cloud of uncertainty that can impair a utility's ability
to attract capital on reasonable terms.
�

These costs and uncertainties result in increased rates paid by
customers and may reduce the utilities' ability to make investments in wildfire
prevention and resilience initiatives, among other priorities that may affect
the health and safety of the State's residents.

����
The legislature additionally finds that securitization may be
the most efficient, least costly way for a utility to finance the contributions
to the wildfire recovery fund.
�
Utility
securitization transactions have an extensive track record of success.

����
Therefore, the purpose of this Act is to serve the public
interest by establishing a mechanism to provide efficient compensation for
property damage resulting from a future catastrophic wildfire allegedly caused
by a regulated utility, while also protecting the financial integrity of Hawaii's
regulated utilities.

����
SECTION
2.
�
The Hawaii Revised Statutes is
amended by adding two new chapters to be appropriately designated and to read
as follows:

"
CHAPTER
A

WILDFIRE
RECOVERY FUND

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�A-1
�
Definitions.
�
As used in this chapter,
unless the context otherwise
requires
:

����
"
Catastrophic

wildfire" means a wildfire occurring in the State on or after the
operation date that destroys more than five hundred commercial structures or
residential structures designed for
habitation.

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"Commission"
means the public utilities commission.

����
"Contributor"
means a public utility that satisfies all requirements to participate in the
wildfire recovery fund.

����
"Covered
catastrophic
wildfire" means a catastrophic wildfire that may have been
caused, or whose severity may have been increased, by a contributor's facilities
or actions.

����
"Electric

utility
" means a public utility that exists
for the furnishing of electrical power.

����
"Executive
director" means the executive director of the wildfire recovery
fund
.

����
"Government
entity" means any government agency, department, division, subdivision,
unit, component, bureau, commission, office, board, or instrumentality of any
kind, including federal, state, and municipal entities.

����
"Investor-
owned

utility" means a public utility that is owned by shareholders and overseen
by a board of directors elected by shareholders.

����
"Operation

date" means the first date for contributors to elect to participate
in the wildfire recovery fund under section A-3(a) and the rules adopted to
implement it.

����
"Property
insurer" means a person or entity that indemnifies another by a contract
of insurance for loss of or damage to real or personal property in the State.

����
"Property
owner
" means an owner of real property in the State.

����
"Public

utility" has the same meaning as in section 269-1.

����
"Qualifying
action" means a civil action by a qualifying claimant to recover
qualifying damages.

����
"Qualified
claimant" means any property owner, property insurer, or tenant who
alleges any qualifying damages.

����
"Qualifying
damages" means damages arising out of the loss of or damage to real or
personal property from a covered catastrophic wildfire.

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"Tenant"
means a person or entity lawfully entitled to occupy real property that the
person or entity does not own in the State.

����
"Wildfire
recovery fund" means the wildfire recovery fund established by section A-2.

����
"
Wildfire

risk mitigation plan" means a plan, which may include a natural hazard
mitigation report, in which a public utility addresses how it will mitigate the
risk of its equipment in causing or exacerbating a wildfire.

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�A-2
�
Wildfire recovery
fund; establishment; executive director.
�
(a) There is established outside the state
treasury a wildfire recovery fund and any accounts thereunder to carry out the
purposes of this chapter.
�
All moneys in
the wildfire recovery fund shall be expended exclusively for the uses and
purposes set forth in this chapter.
�
The
wildfire recovery fund shall not be subject to chapter 431.
�
The moneys in the wildfire recovery fund not
required for immediate use shall be invested by the

executive director for the benefit of the wildfire recovery fund; provided that
no assets of the program shall be transferred to the general fund of the State
or to any other fund of the State or otherwise encumbered or used for any
purpose other than those specified for the wildfire recovery fund.

����
(b)

�
The wildfire
recovery fund shall be placed within the department of
commerce
and consumer affairs for administrative
purposes.
�
The fund shall be a public
body corporate and politic.

����
(c)

�
The governor shall appoint an executive
director of the wildfire recovery fund, who shall be exempt from chapter 76,
and shall fix the executive director's compensation.
�
The executive director may be removed only by
the governor.

����
(d)

�
The
executive

director shall be responsible for the day-to-day operations and management of
the wildfire recovery fund and shall perform all functions necessary to implement
this chapter, including entering into contracts and other obligations related
to the operation, management, and administration of the wildfire recovery fund.

����
(e)

�
The
executive director
may retain, employ, or contract with officers; experts; employees; accountants;
actuaries; financial professionals; and other advisers, consultants, attorneys,
and professionals, as may be necessary in the executive director's judgment,
for the efficient operation, management, and administration of the wildfire
recovery fund.

����
(f)
�
The

executive

director shall have the power to issue revenue bonds, from time to time, in
such principal amounts as the executive director may deem advisable for the
purpose of this chapter, backed by future payments to the wildfire recovery
fund that contributors have committed to make.
�

These bonds shall be issued pursuant to part III of chapter 39, except
as provided in this chapter.

����
(g)

�
The
executive

director shall adopt rules pursuant to chapter 91 to implement this chapter.

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�A-3
�
Wildfire recovery
fund; eligibility for participation as a contributor; contributions.
�
(a)
�
To be eligible to participate
as

a contributor, a person or entity shall:

����
(1)
�
Be a public utility that has a wildfire risk
mitigation plan that has been approved or accepted by the commission;

����
(2)
�
Notify the executive director, in the year before
the person or entity becomes a contributor, that it intends to participate in
the wildfire recovery fund; and

����
(3)
�
Agree to make an initial contribution, the
payment of which is thereafter a binding commitment enforceable by the
executive director.

����
(b)
�
The initial contributions from investor-owned
electric utilities collectively shall be:

����
(1)
�
$1,000,000,000 plus interest as provided in subsection
(c) for amounts not securitized, which amounts shall be recovered from its
customers in nonbypassable rates; and

����
(2)
�
$5,000,000, which amount shall be funded by
shareholders of those investor-owned electric utilities and used exclusively
for the payment of salaries of the executive director and of all other persons
retained by the executive director to implement this chapter, with any funds
remaining in 2035 to be transferred to the wildfire recovery fund.

����
(c)

�
The
investor-owned electric
utilities may elect to make the initial contributions set forth in subsection
(b)(1), to the degree not paid for through securitization pursuant to chapter B,
over a period not to exceed five years; provided that interest shall be added
to any amounts paid after the first year, at an interest rate equal to the
investor-owned electric utilities' incremental cost of long-term debt, with
such interest recovered from customers in rates.

����
(d)

�
The executive director shall determine
the initial contributions from other public utilities based on an actuarial
assessment of the risk of potential payments by the wildfire recovery fund
resulting

from covered catastrophic wildfires created by such public utility.

����
(e)

�
The executive director may propose
supplemental contributions to the
wildfire
recovery fund by
participating public utilities.

����
(f)

�
If a contributor fails to pay any part
of an initial contribution or a
supplemental
contribution that it
agreed to make, or elects not to agree to make a supplemental contribution,
that contributor will no longer be a contributor as of the date on which the
payment was due, and the contributor shall not receive any refund of payments
previously made; provided that a contributor that elects not to make a
supplemental contribution shall be a contributor as to any catastrophic
wildfire that occurs prior to the election date.
�
After failing to, or electing not to, make a
payment, a public utility may rejoin the wildfire recovery fund as a
contributor on a prospective basis if it makes owed payments with interest.

����
(g)

�
The executive director shall adopt rules
pursuant to chapter 91 regarding the timing of initial and supplemental
contributions, which may include upfront, annual, and retrospective payments (i.e.,
payments made after a wildfire occurs).

����
(h)
�
Initial
and supplemental
contributions of investor-owned electric utilities shall constitute "wildfire
recovery costs" as defined in section B-1.

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�A-4
�
Determination of a
covered catastrophic wildfire.
�
The
executive director shall adopt rules pursuant to chapter 91 regarding how to
determine whether a wildfire is a covered catastrophic
wildfire
.
�
These rules shall include a requirement that
a wildfire shall be determined to be a covered catastrophic wildfire if a party
makes non-frivolous allegations in a legal action that a contributor's
facilities caused or contributed to the severity of a catastrophic wildfire.

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�A-5
�
Replenishment of the
wildfire recovery fund.
�
(a) If the wildfire recovery fund has made
payments with respect to a covered
catastrophic
wildfire and after
resolution of substantially all third-party liability claims that were brought
or could be brought against contributors arising from that covered catastrophic
wildfire, each contributor whose facilities were implicated in the covered
catastrophic wildfire shall initiate a proceeding before the commission to
review the prudence of the public utility's conduct leading to the catastrophic
wildfire.

����
(b)

�
The commission shall determine whether
the contributor acted prudently:

����
(1)
�
Considering only acts that may have caused the
occurrence or contributed to the severity of the covered catastrophic wildfire;
and

����
(2)
�
Evaluating the contributor's actions in the
context of its overall systems, processes, and programs, such that an error by
a contributor's employee would not be a basis for a finding of imprudence,
unless that error resulted from an imprudent system, process, or program.

����
(c)

�
If the commission determines that
imprudent conduct by the contributor caused the occurrence or contributed to
the severity of a covered
catastrophic
wildfire, the
commission shall determine whether to order the contributor to replenish the
wildfire recovery fund in whole or in part for payments from the wildfire
recovery fund in connection with the catastrophic wildfire.
�
In determining the amount of replenishment,
if any, the commission shall consider the extent and severity of the
contributor's imprudence and factors within and beyond the contributor's
control that may have led to or exacerbated the costs from the covered
catastrophic wildfire, including but not limited to humidity, temperature,
winds, fuel, merged wildfires with independent ignitions, third-party actions
that affected the spread of the wildfire, and fire suppression activities.

����
(d)

�
Over any
three
-year
period, the commission shall not order the contributor to reimburse the
wildfire recovery fund in an amount that exceeds twenty per cent of the
contributor's transmission and distribution equity rate base.

����
(e)
�
A contributor shall not recover in regulated
rates any amount that
the
commission orders it to
pay to the wildfire recovery fund as a replenishment under this section.

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�A-6
�

Claims for payment by qualified claimants; presentment requirement
.
�
(a)
�
The executive director shall adopt rules
pursuant to chapter 91 to create a process through which a qualified claimant
that is not a government entity may submit to the wildfire recovery fund a
claim for payment of economic damages arising out of property damage resulting
from a covered catastrophic wildfire, including a deadline to submit claims.

����
(b)
�
A qualified claimant shall
file a claim for payment for economic damages arising out of the loss of or
damage to real or personal property from a covered catastrophic wildfire
pursuant to this section.
�
The claim of a
qualified claimant that is not a property insurer shall be limited to uninsured
economic damages.
�
A qualified claimant
shall not file or maintain a civil action against a contributor unless and
until it rejects an offer of settlement from the wildfire recovery fund.
�
�
A
qualified claimant who fails to file a claim by the deadline established by the
executive director pursuant to rule shall be ineligible to receive payment from
the wildfire recovery fund and shall be barred from instituting or maintaining
any qualifying action against a contributor.

����
(c)
�
The executive
director shall make an offer to settle each claim submitted, which
the
claimant may accept or reject.
�

In determining the amount of each offer, the executive director shall
consider, at a minimum:

����
(1)
�
The economic damages sought by all qualified
claimants in the aggregate;

����
(2)
�
The amount available to the wildfire recovery fund
relative to the amount under paragraph (1);

����
(3)
�
The strength of any evidence of contributor
liability; and

����
(4)
�
The strength of any evidence of involvement of
non-contributor third-parties.

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(d)
�
If the amount
available to the wildfire recovery fund, including assets held by the wildfire
recovery fund and
all payments contributors are
obligated to make to the wildfire recovery fund, is less than fifty per cent of
the aggregate liability limit as calculated in section A-8, the wildfire
recovery fund shall make payment only to contributors pursuant to section A-7.

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�A-7
�

Claims for payment by contributors.
�

The executive director shall adopt
rules pursuant to chapter 91 to create a process through which a contributor
may obtain payment from the wildfire recovery fund to satisfy settled or
finally adjudicated claims for recovery
of

qualifying damages after exhausting the contributor's available insurance.
�
The rules shall establish the standard for
approving any settlement.
�
To the extent
that the wildfire recovery fund lacks sufficient funds to make a payment to a
participating utility when sought, the wildfire recovery fund shall make such
payment upon receipt
of contributions that contributors are
obligated to make to the wildfire recovery fund under payment schedules.

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�A-8
�

Limitation on aggregate liability.
�

(a)
�
The aggregate liability of all contributors
for
qualifying damages arising from a covered
catastrophic

wildfire
, including economic and non-economic
damages, shall not exceed the greater of:

����
(1)
�
Fifty per cent of the amount available to the
wildfire recovery fund at the time of the covered catastrophic wildfire, including
amounts in and obligated to the wildfire recovery fund; or

����
(2)
�
The average assessed value of commercial
structures and residential structures designed for habitation in the county in
which the covered catastrophic wildfire ignited, multiplied by the number of
commercial structures or residential structures designed for habitation that
were destroyed.

����
(b)
�
The following amounts
shall be added to determine whether the aggregate liability limit has been
reached:

����
(1)
�
Payments from the wildfire recovery fund under
section A-6; and

����
(2)
�
Payments by a contributor in connection with
any settlement or judgment on a claim for qualifying damages.

����
(c)
�
All civil actions
arising out of a catastrophic wildfire
shall
be
brought in the circuit in which the catastrophic wildfire occurred.
�
The court shall adopt procedures to equitably
apply the limit set forth in subsection (a) to all civil claims that are
filed.
�
All settlements or judgments for
claims for
qualifying damages

shall be subject to approval by the court.
�

The court shall not approve any settlement or judgment that would cause
the aggregate liability of contributors to exceed the aggregate liability
limit.

����
(d)
�
A court shall
consolidate cases arising from a covered catastrophic wildfire.
�
Any circuit court that is not the
consolidating
court shall transfer any civil case to facilitate such
consolidation.

����
�A-9
�

Limitations on claims.
�
(a)
�
No qualifying action
may be instituted or maintained by a qualified claimant against contributors or
their affiliates, employees, agents, or insurers if the qualified claimant
accepts an offer under section A-6; provided that the rights of a property
insurer to sue as a subrogee of its policyholder shall not be affected by a
property owner's or tenant's acceptance of an offer under section A-6 and the
subrogation rights shall be affected only if the property insurer elects to
accept an offer under section A-6.

����
(b)
�
No suit, claim,
arbitration, or other civil legal action for indemnity or contribution for
amounts paid, or that may be paid, as a result of a covered catastrophic
wildfire, may be instituted or
maintained
by any
persons or entities against contributors or their affiliates, employees,
agents, or insurers for
qualifying damages
.

����
�
A-10
�
Several
liability.
�
Any law to the contrary
notwithstanding, joint and several liability is abolished for any
qualifying
damages
.
�
Any
person or entity that is sued for
qualifying damages
may argue
for

apportionment of fault to any other person or entity regardless of whether that
person or entity is a party to the action.

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�A-11
�
Reporting; refunds
authorized by legislature.
�
(a)
�
The executive director
shall submit to the legislature an annual report regarding the wildfire
recovery fund no later than ninety days prior to the beginning of each
regular
session until 2034.
�
The
annual plan submitted by the executive director shall include an update on the
activities of the wildfire recovery fund.

����
(b)
�
No later than ninety days prior to the
regular session of 2035, the executive director shall submit a report regarding
the
financial
status and resources of the wildfire
recovery fund relative to the then-current assessment of actuarial risk of a
catastrophic wildfire.

����
(c)
�
Based on the report in subsection (b), the legislature
may
determine
that the wildfire recovery fund is
overfunded and direct the executive director to return contributions, in whole
or in part, with associated investment earnings, to contributors.
�
Any payments made to the wildfire recovery
fund that were recovered in regulated rates from customers, and any investment
earnings associated with those payments, shall, in the event that the
legislature orders a refund, be returned to those customers.

����
�A-12
�
Inadmissible
evidence.
�
Any findings made or evidence submitted for purposes of
proceedings under sections A-4, A-6, and A-7 shall be subject to the limits on
admissibility
under rule 408, section 626-1.

CHAPTER
B

SECURITIZATION

����
�B-1
�
Definitions.
�
As used in this chapter, unless the context
otherwise requires:

����
"Ancillary
agreement" means a bond insurance policy, letter of credit, reserve
account, surety bond, swap arrangement, hedging arrangement, liquidity
or

credit support arrangement, or other similar agreement or arrangement entered
into in connection with the issuance of bonds that is designed to promote the
credit quality and marketability of the bonds or to mitigate the risk of an
increase in interest rates.

����
"Assignee"
means a legally recognized entity to which an electric utility assigns, sells,
or transfers, other than as security, all or a portion of the electric utility's
interest in or right to wildfire recovery property.
�
"Assignee" includes a corporation,
limited liability company, general partnership or limited partnership, public
authority, trust, financing entity, or any other legal entity to which an
assignee assigns, sells, or transfers, other than as security, its interest in
or right to wildfire recovery property.

����
"Bond"
means any bond, note, certificate of participation or beneficial interest, or
other evidence of indebtedness or ownership that is issued by the financing
entity under a financing order, the proceeds of which are used directly or
indirectly to recover, finance, or refinance financing costs of any wildfire
recovery costs, and that are directly or indirectly secured by or payable from
wildfire recovery property.

����
"Commission"
means the public utilities commission.

����
"Consumer"
means any individual, governmental body, trust, business entity, or nonprofit
organization that consumes electricity that has been transmitted or distributed
by means of electric transmission or distribution facilities, whether those
electric transmission or distribution facilities are owned by the consumer, the
electric utility, or any other party.

����
"Electric
cooperative" means an electric utility that meets the requirements under
section 269-31(c).

����
"Electric
cooperative wildfire claims costs" means costs incurred by an electric
cooperative to resolve third-party liability claims arising from any wildfire
occurring in the State that are not covered by insurance and that the
commission finds to be just and reasonable.
�

Electric cooperative wildfire claims costs do not include costs incurred
by an investor-owned electric utility.

����
"Electric
utility" means a public utility that exists for the furnishing of
electrical power.

����
"Financing
costs" means the costs to issue, service, repay, or refinance bonds,
whether incurred or paid upon issuance of the bonds or over the life of the
bonds, if they are approved for recovery by the commission in a financing
order.
�
"Financing costs" may
include any of the following:

����
(1)
�
Principal, interest, and redemption premiums
that are payable on bonds;

����
(2)
�
A payment required under an ancillary
agreement;

����
(3)
�
An amount required to fund or replenish
reserve accounts or other accounts established under an indenture, ancillary
agreement, or other financing document related to the bonds;

����
(4)
�
Taxes, franchise fees, or license fees imposed
on a financing entity as a result of the issuance of the financing order; the
assignment, sale, or transfer of any wildfire recovery property; or the sale of
the bonds, or imposed on the wildfire recovery charges, or otherwise resulting
from the collection of the wildfire recovery charge, in any such case whether
paid, payable, or accrued;

����
(5)
�
Costs related to issuing and servicing bonds
or the application for a financing order, including without limitation
servicing fees and expenses, trustee fees and expenses, legal fees and
expenses, accounting fees, administrative fees, underwriting and placement
fees, financial advisory fees, original issue discount, capitalized interest,
rating agency fees, and any other related costs that are approved for recovery
in the financing order; and

����
(6)
�
Other costs as specifically authorized by a
financing order.

����
"Financing
entity" means an electric utility or an entity to which an electric
utility or an affiliate of an electric utility sells, assigns, or pledges all
or a portion of the electric utility's interest in wildfire recovery property,
including an affiliate of the electric utility or any unaffiliated entity, in
each case as approved by the commission in a financing order.

����
Subject
to section B-6(c), an entity to which an electric utility sells, assigns, or
pledges all or a portion of the electric utility's interest in wildfire
recovery property may include any governmental entity that is able to issue
bonds that are exempt from federal tax pursuant to section 103 of the Internal
Revenue Code of 1986, as amended, including the State or a political subdivision
thereof or any department, agency, or instrumentality of the State or political
subdivision; provided that the bonds issued shall not constitute a general
obligation of the State or any political subdivision thereof or any department,
agency, or instrumentality of the State or political subdivision and shall not
constitute a pledge of the full faith and credit of the entity or of the State
or any political subdivision thereof, but shall be payable solely from the
funds provided under this chapter.

����
"Financing
order" means an order of the commission under this chapter that has become
final and no longer subject to appeal as provided by law and that authorizes
the issuance of bonds and the imposition, adjustment from time to time, and
collection of wildfire recovery charges, and that shall include a procedure to
require the expeditious approval by the commission of periodic adjustments to
wildfire recovery charges and to any associated fixed recovery tax amounts
included in that financing order to ensure recovery of all wildfire recovery costs
and the costs associated with the proposed recovery, financing, or refinancing
thereof, including the costs of servicing and retiring the bonds contemplated
by the financing order.

����
"Financing
party" means any holder of the bonds; any party to or beneficiary of an
ancillary agreement; and any trustee, collateral agent, or other person acting
for the benefit of any of the foregoing.

����
"Fixed
recovery tax amounts" means those nonbypassable rates and other charges,
including but not limited to distribution, connection, disconnection, and
termination rates and charges, that are needed to recover federal and state
taxes associated with wildfire recovery charges authorized by the commission in
a financing order, but are not approved as financing costs financed from
proceeds of bonds.

����
"Investor-owned
utility" means a public utility that is owned by shareholders and overseen
by a board of directors elected by shareholders.

����
"Public
utility" has the same meaning as in section 269-1.

����
"True-up
adjustment" means a formulaic adjustment to the wildfire recovery charges
as they appear on consumer bills that is necessary to correct for any
overcollection or undercollection of the wildfire recovery charges authorized
by a financing order and to otherwise ensure the timely and complete payment
and recovery of wildfire recovery costs over the authorized repayment term.

����
"Wildfire
recovery charges" means the nonbypassable charges, including but not
limited to distribution, connection, disconnection, and termination rates and
charges, that are authorized by section B-2 and in a financing order authorized
under this chapter to be imposed on and collected from all existing and future
consumers of a financing entity or any successor to recover principal,
interest, and other financing costs relating to the bonds.

����
"Wildfire
recovery costs" means an investor-owned electric utility's contributions
to the wildfire recovery fund, as set forth in section A-3, and electric
cooperative wildfire claims costs.
�

Wildfire recovery costs shall also include professional fees, consultant
fees, redemption premiums, tender premiums, and other costs incurred by the
electric utility in using proceeds of bonds to acquire outstanding securities
of the electric utility that the commission has determined were or will be
prudently incurred.

����
"Wildfire
recovery fund" means the wildfire recovery fund established by chapter A.

����
"Wildfire
recovery property" means the property right created pursuant to this chapter,
including without limitation the right, title, and interest of the electric
utility, financing entity, or its assignee:

����
(1)
�
In and to the wildfire recovery charge
established pursuant to a financing order, including the right to impose, bill,
collect, and receive such wildfire recovery charges under the financing order
and all rights to obtain adjustments to the wildfire recovery charge in
accordance with section B-3 and the financing order; and

����
(2)
�
To be paid the amount that is determined in a
financing order to be the amount that the electric utility or its assignee is
lawfully entitled to receive pursuant to this chapter and the proceeds thereof,
and in and to all revenues, collections, claims, payments, moneys, or proceeds
of, or arising from, the wildfire recovery charge that is the subject of a
financing order.

"Wildfire recovery property"
does not include a right to be paid fixed recovery tax amounts.
�
"Wildfire recovery property" shall
constitute a current property right, notwithstanding the fact that the value of
the property right will depend on consumers using electricity or, in those
instances where consumers are customers of the electric utility, the electric
utility performing certain services.

����
�B-2
��
Applications to issue bonds and authorize
wildfire recovery charges.
�
(a)
�
An electric utility may apply to the
commission for one or more financing orders to issue bonds to recover any
wildfire recovery costs, each of which authorizes the following:

����
(1)
�
The imposition, charging, and collection of a
wildfire recovery charge, to become effective upon the issuance of the bonds,
and an adjustment of any such wildfire recovery charge in accordance with a
true-up adjustment mechanism under this chapter in amounts sufficient to pay
the principal and interest on the bonds and all other associated financing
costs on a timely basis;

����
(2)
�
The creation of wildfire recovery property
under the financing order; and

����
(3)
�
The imposition, charging, and collection of
fixed recovery tax amounts to recover any portion of the electric utility's
federal and state taxes associated with those wildfire recovery charges and not
financed from the proceeds of bonds.

����
(b)
�
The application shall include all of the
following:

����
(1)
�
The wildfire recovery costs to be financed
through the issuance of bonds;

����
(2)
�
The principal amount of the bonds proposed to
be issued and the selection of a financing entity;

����
(3)
�
An estimate of the date on which each series
of bonds is expected to be issued;

����
(4)
�
The scheduled final payment date, which shall
not exceed thirty years, and a legal final maturity date, which may be longer,
subject to rating agency and market considerations, during which term the
wildfire recovery charge associated with the issuance of each series of bonds
is expected to be imposed and collected;

����
(5)
�
An estimate of the financing costs associated
with the issuance of each series of bonds;

����
(6)
�
An estimate of the amount of the wildfire
recovery charge revenues necessary to pay principal and interest on the bonds
and all other associated financing costs as set forth in the application and
the calculation for that estimate;

����
(7)
�
A proposed design of the wildfire recovery
charge and a proposed methodology for allocating the wildfire recovery charge
among customer classes within the electric utility's service territory;

����
(8)
�
A description of the financing entity selected
by the electric utility;

����
(9)
�
A description of a proposed true-up adjustment
mechanism for the adjustment of the wildfire recovery charge to correct for any
overcollection or undercollection of the wildfire recovery charge, and to
otherwise ensure the timely payment of principal and interest on the bonds and
all other associated financing costs; and

���
(10)
�
Any other information required by the
commission.

����
(c)
�
An electric utility may file an application
for a financing order, including as a joint application with one or more
affiliate electric utilities, to issue bonds to recover wildfire recovery
costs.
�
The application shall include a
description of:

����
(1)
�
How the wildfire recovery charges will be
allocated among the applicant electric utilities in a manner that is equitable
and that need not correspond to the incurrence of wildfire recovery costs by
each electric utility; and

����
(2)
�
Whether and how the consumers of any of the
applicant electric utilities will be responsible for the payment of wildfire
recovery charges allocated to consumers of affiliate electric utilities.

����
In
the alternative, an electric utility may apply for a financing order to issue
bonds to recover wildfire recovery costs, including wildfire recovery costs
incurred, or to be incurred, by the applicant and one or more of its affiliate
electric utilities.
�
In connection with
the issuance of a financing order pursuant to this subsection, the commission
shall issue a concurrent order to the affiliate electric utility or electric
utilities directing such affiliate electric utility or electric utilities to
impose rates on its or their consumers designed to generate revenue sufficient
to pay credits over the life of the bonds to the applicant electric utility in
such amount as the commission determines is equitable, just, and
reasonable.
�
Such an application shall
describe the allocation method and adjustment mechanism for the affiliate
electric utility credit payments proposed to be subject to the concurrent
commission order.

����
(d)
�
The commission shall issue an approval or
denial of any application for a financing order filed pursuant to this section
within ninety days of the last filing in the applicable docket but no later
than one year after the application is filed.

����
(e)
�
In exercising its duties under this section,
the commission shall consider:

����
(1)
�
Whether the recovery of such costs is
consistent with the public interest;

����
(2)
�
Whether the structuring, marketing, and
pricing of the bonds are expected to result in the lowest wildfire recovery
charges consistent with market conditions at the time at which the bonds are
priced and the terms of the financing order;

����
(3)
�
Whether the terms and conditions of any bonds
to be issued are just and reasonable;

����
(4)
�
With respect to an application by an
investor-owned utility, whether the recovery of wildfire recovery costs through
the designation of the wildfire recovery charges and any associated fixed
recovery tax amounts, and the issuance of bonds in connection with the wildfire
recovery charges, would result in net savings or mitigate rate impacts to
consumers, as compared to rate recovery without securitization; and

����
(5)
�
Any other factors that the commission deems
reasonable and in the public interest.

If the commission makes the
determination specified in this section, the commission shall establish, as
part of the financing order, a procedure for the electric utility to submit
applications from time to time to request the issuance of additional financing
orders designating wildfire recovery charges and any associated fixed recovery
tax amounts as recoverable.

����
At
the option of the electric utility, the electric utility may include in its
application for a financing order a request for authorization to sell,
transfer, assign, or pledge wildfire recovery property to a governmental entity
if the electric utility expects bonds issued by a governmental entity would
result in a more cost-efficient means, taking into account all financing costs
related to the bonds, than using another financing entity to issue bonds to
finance the same wildfire recovery costs, taking into account the costs of
issuing the other financing entity's bonds.

����
(f)
�
Wildfire recovery charges and any associated
fixed recovery tax amounts shall be imposed only on existing and future
consumers in the utility service territory.
�

Consumers within the utility service territory of the electric utility
that are subject to the financing order shall continue to pay wildfire recovery
charges and any associated fixed recovery tax amounts until the bonds and
associated financing costs are paid in full by the financing entity.

����
�B-3
�
Wildfire recovery financing order.
�
(a)
�
A
financing order shall remain in effect until the bonds issued under the
financing order and all financing costs related to the bonds have been paid in
full or defeased by their terms.

����
A
financing order shall remain in effect and unabated notwithstanding the
bankruptcy, reorganization, or insolvency of the electric utility or the
commencement of any judicial or nonjudicial proceeding on the financing order.

����
(b)
�
Notwithstanding any other law to the contrary,
with respect to wildfire recovery property that has been made the basis for the
issuance of bonds and with respect to any associated fixed recovery tax
amounts, the financing order, the wildfire recovery charges, and any associated
fixed recovery tax amounts shall be irrevocable.
�
The State and its agencies, including the
commission, pledge and agree with bondholders, the owners and assignees of the
wildfire recovery property, and other financing parties that the State and its
agencies shall not take any action listed in this subsection.
�
This subsection shall not preclude an action
if such action would not adversely affect the interests of the electric utility
and of assignees of the wildfire recovery property.
�
The prohibited actions shall be the
following:

����
(1)
�
Alter the provisions of this chapter, which
authorize the commission to create an irrevocable contract right or choice in
action by the issuance of a financing order, to create wildfire recovery
property and make the wildfire recovery charges imposed by a financing order
irrevocable, binding, nonbypassable charges for all existing and future
consumers;

����
(2)
�
Take or permit any action that impairs or
would impair the value of wildfire recovery property or the security for the
bonds or revise the wildfire recovery costs for which recovery is authorized;

����
(3)
�
In any way impair the rights and remedies of
the bondholders, assignees, and other financing parties;

����
(4)
�
Except for changes made pursuant to the
formula-based true-up mechanism authorized under subsection (d), reduce, alter,
or impair wildfire recovery charges that are to be imposed, billed, charged,
collected, and remitted for the benefit of the bondholders, any assignee, and
any other financing parties until any and all principal, interest, premium,
financing costs, and other fees, expenses, or charges incurred, and any
contracts to be performed, in connection with the related bonds have been paid
and performed in full.

����
The
financing entity is authorized to include this pledge in the bonds.

����
(c)
�
Under a financing order, the electric utility
shall retain sole discretion to select the financing entity and to cause bonds
to be issued, including the right to defer or postpone the issuance,
assignment, sale, or transfer of wildfire recovery property.

����
(d)
�
The commission may create, pursuant to an
application from an electric utility, a nonbypassable charge referred to as a
wildfire recovery charge, which shall be applied to recover principal,
interest, and other financing costs relating to the bonds.
�
The wildfire recovery charge shall be a
dedicated, discrete tariff rider.

����
The
commission shall, in any financing order, establish a procedure for periodic
true-up adjustments to wildfire recovery charges, which shall be made at least
annually and may be made more frequently.
�

Within thirty days after receiving an electric utility's filing of a
true-up adjustment, the commission's review of the filing shall be limited to
mathematical or clerical errors as determined in accordance with any true-up
adjustment formulas set forth in the applicable financing order.

����
The
commission shall either approve the filing or inform the electric utility of
any mathematical or clerical errors in its calculation.
�
If the commission informs the electric
utility of mathematical or clerical errors in its calculation, the electric
utility shall correct its error and refile its true-up adjustment.
�
The timeframes previously described in this
subsection shall apply to a refiled true-up adjustment.

����
(e)
�
Neither financing orders nor bonds issued
under this chapter shall constitute a general obligation of the State or any of
its political subdivisions, nor shall they constitute a pledge of the full
faith and credit of the State or any of its political subdivisions, but shall
be payable solely from the wildfire recovery property provided under this
chapter.

����
All
bonds shall contain on the face thereof a statement to the following
effect:
�
"Neither the full faith and
credit nor the taxing power of the State of Hawaii is pledged to the payment of
the principal of, or interest and premium on, this bond."

����
The
issuance of bonds under this chapter shall not directly, indirectly, or
contingently obligate the State or any of its political subdivisions to levy or
pledge any form of taxation or to make any appropriation for their payment.

����
(f)
�
Wildfire recovery charges are wildfire
recovery property when, and to the extent that, a financing order authorizing
the wildfire recovery charges has become effective in accordance with this chapter,
and the wildfire recovery property shall thereafter continuously exist as
property for all purposes, and all of the rights and privileges relating to
that property shall continuously exist for the period and to the extent
provided in the financing order, but in any event until the bonds, including
all principal; premiums, if any; interest with respect to the bonds; and all
other financing costs are paid in full.
�

A financing order may provide that the creation of wildfire recovery
property shall be simultaneous with the sale of the wildfire recovery property
to an assignee as provided in the application of the pledge of the wildfire
recovery property to secure the bonds.

����
(g)
�
Any successor to a financing entity shall be
bound by the requirements of this chapter and shall perform and satisfy all
obligations of and have the same rights under a financing order as, and to the
same extent as, the financing entity.

����
�B-4
Bonds; issuance; wildfire recovery property interests.
�
(a)
�

The electric utility may sell and assign all or portions of its interest
in wildfire recovery property to one or more financing entities that make that
wildfire recovery property the basis for issuance of bonds, to the extent
approved in a financing order.
�
The
electric utility or financing entity may pledge wildfire recovery property as
collateral, directly or indirectly, for bonds to the extent approved in the
pertinent financing orders providing for a security interest in the wildfire recovery
property, in the manner set forth in this section.
�
In addition, wildfire recovery property may
be sold or assigned by either of the following:

����
(1)
�
The financing entity or a trustee for the
holders of bonds or the holders of an ancillary agreement in connection with
the exercise of remedies upon a default under the terms of the bonds; or

����
(2)
�
Any person acquiring the wildfire
recovery
property
after a sale or assignment pursuant to this chapter.

����
(b)
�
To the extent that any interest in wildfire recovery
property is sold, assigned, or is pledged as collateral pursuant to subsection
(a), the commission may authorize the electric utility to contract with the
financing entity or its assignees that the electric utility will:

����
(1)
�
Continue to operate its system to provide
service to consumers within its service territory;

����
(2)
�
Collect amounts in respect of the wildfire
recovery charges for the benefit and account of the financing entity or its
assignees; and

����
(3)
�
Account for and remit these amounts to or for
the account of the financing entity or its assignees.

Contracting with the financing entity
or its assignees in accordance with that authorization shall not impair or
negate the characterization of the sale, assignment, or pledge as an absolute
transfer, a true sale, or a security interest, as applicable.
�
To the extent that billing, collection, and
other related services with respect to the provision of the electric utility's
services are provided to a consumer by any person or entity other than the
electric utility in whose service territory the consumer is located, that
person or entity shall collect the wildfire recovery charges and any associated
fixed recovery tax amounts from the consumer for the benefit and account of the
electric utility, financing entity, or assignees with the associated revenues
remitted solely for such person's benefit as a condition to the provision of
electric service to that consumer.

����
Each
financing order shall impose terms and conditions, consistent with the purposes
and objectives of this chapter, on any person or entity responsible for
billing, collection, and other related services, including without limitation
collection of the wildfire recovery charges and any associated fixed recovery
tax amounts, that are the subject of the financing order.

����
(c)
�
The financing entity may issue bonds upon
approval by the commission in a financing order.
�
Bonds shall be nonrecourse to the credit or
any assets of the electric utility, other than the wildfire recovery property
as specified in that financing order.

����
(d)
�
Wildfire recovery property that is specified
in a financing order shall constitute an existing, present property right,
notwithstanding the fact that the imposition and collection of wildfire
recovery charges depend on the electric utility's continuing to provide
services or continuing to perform its servicing functions relating to the
collection of wildfire recovery charges or on the level of future service
consumption (e.g., electricity consumption).
�

Wildfire recovery property shall exist whether or not the wildfire
recovery charges have been billed, have accrued, or have been collected and
notwithstanding the fact that the value for a security interest in the wildfire
recovery property, or amount of the wildfire recovery property, is dependent on
the future provision of service to consumers.
�

All wildfire recovery property specified in a financing order shall
continue to exist until the bonds issued pursuant to a financing order and all
associated financing costs are paid in full.

����
(e)
�
Wildfire recovery property; wildfire recovery
charges; and the interests of an assignee, bondholder, or financing entity, or
any pledgee in wildfire recovery property and wildfire recovery charges shall
not be subject to setoff, counterclaim, surcharge, recoupment, or defense by
the electric utility or any other person or in connection with the bankruptcy,
reorganization, or other insolvency proceeding of the electric utility, any
affiliate of the electric utility, or any other entity.

����
(f)
�
Notwithstanding any law to the contrary, any
requirement under this chapter or a financing order that the commission take
action with respect to the subject matter of a financing order shall be binding
upon the commission, as it may be constituted from time to time, and any
successor agency exercising functions similar to the commission, and the
commission shall have no authority to rescind, alter, or amend that requirement
in a financing order.

����
�B-5
�
Wildfire recovery charge.
�
(a)
�

The wildfire recovery charge created pursuant to a financing order
approved pursuant to section B-2 shall be a nonbypassable charge of a financing
entity that shall be applied to the repayment of bonds and related financing
costs as described in this chapter.
�
The
wildfire recovery charge and any associated fixed recovery tax amounts may be a
usage-based charge, a flat user charge, or a charge based upon customer
revenues as determined by the commission for each consumer class in any
financing order.

����
(b)
�
As long as any bonds are outstanding and any
financing costs have not been paid in full, any wildfire recovery charge and
any associated fixed recovery tax amounts authorized under a financing order
shall be nonbypassable.
�
Subject to any
exceptions provided in a financing order, a wildfire recovery charge and any
associated fixed recovery tax amounts shall be paid by all existing and future
consumers within the utility service territory.

����
(c)
�
The wildfire recovery charge shall be
collected by an electric utility or its successors, in accordance with section B-8(a),
in full through a charge that is separate and apart from the electric utility's
rates.

����
(d)
�
An electric utility may exercise the same
rights and remedies under its tariff and applicable law and regulation based on
a consumer's nonpayment of the wildfire recovery charge as it could for a
consumer's failure to pay any other charge payable to that electric utility.

����
�B-6
�
Security interests in wildfire recovery
property; financing statements.
�

(a)
�
A security interest in
wildfire recovery property is valid and enforceable against the pledgor and
third parties, subject to the rights of any third parties holding security
interests in the wildfire recovery property perfected in the manner described
in this section, and attaches when all of the following have occurred:

����
(1)
�
The commission has issued a financing order
authorizing the wildfire recovery charge to be included in the wildfire
recovery property;

����
(2)
�
Value has been given by the pledgees of the
wildfire recovery property; and

����
(3)
�
The pledgor has signed a security agreement
covering the wildfire recovery property.

����
(b)
�
A valid and enforceable security interest in
wildfire
recovery property
is perfected when it has
attached and when a financing statement has been filed with the bureau of
conveyances of the State of Hawaii naming the pledgor of the wildfire
recovery
property
as "debtor" and identifying the wildfire
recovery
property
.

����
Any
description of the wildfire
recovery property
shall be
sufficient if it refers to the financing order creating the wildfire
recovery
property
.
�
A copy of the financing
statement shall be filed with the commission by the electric utility that is
the pledgor or transferor of the wildfire
recovery property
,
and the commission may require the electric utility to make other filings with
respect to the security interest in accordance with procedures that the
commission may establish; provided that the filings shall not affect the
perfection of the security interest.

����
(c)
�
A perfected security interest in wildfire
recovery
property
shall be a continuously perfected security interest in all
wildfire
recovery property
revenues and proceeds
arising with respect thereto, whether or not the revenues or proceeds have
accrued.
�
Conflicting security interests
shall rank according to priority in time of perfection.
�
Wildfire
recovery property

shall constitute property for all purposes, including for contracts securing
bonds, whether or not the wildfire
recovery property

revenues and proceeds have accrued.

����
(d)
�
Subject to the terms of the security
agreement covering the wildfire
recovery property
and the rights of
any third parties holding security interests in the wildfire
recovery
property
, perfected in the manner described in this section, the
validity and relative priority of a security interest created under this
section shall not be defeated or adversely affected by the commingling of
revenues arising with respect to the wildfire
recovery property

with other funds of the electric utility that is the pledgor or transferor of
the wildfire
recovery property
, or by any security interest
in a deposit account of that electric utility perfected under article 9 of chapter
490, into which the revenues are deposited.

����
Subject
to the terms of the security agreement, upon compliance with the requirements
of section 490:9-312(b)(1), the pledgees of the wildfire
recovery
property
shall have a perfected security interest in all cash and
deposit accounts of the electric utility in which wildfire
recovery
property
revenues have been commingled with other funds.

����
(e)
�
If default occurs under the security
agreement covering the wildfire
recovery property
, the pledgees of
the wildfire
recovery property
, subject to the terms of
the security agreement, shall have all rights and remedies of a secured party
upon default under article 9 of chapter 490 and shall be entitled to foreclose
or otherwise enforce their security interest in the wildfire
recovery
property
, subject to the rights of any third parties holding prior
security interests in the wildfire
recovery property

perfected in the manner provided in this section.

����
In
addition, the commission may require in the financing order creating the
wildfire
recovery property
that in the event of
default by the electric utility in payment of wildfire
recovery property

revenues, the commission and any successor thereto, upon the application by the
pledgees or assignees, including assignees under section B-5 of the wildfire
recovery
property
, and without limiting any other remedies available to the
pledgees or assignees by reason of the default, shall order the sequestration
and payment to the pledgees or assignees of wildfire
recovery property

revenues.
�
Any financing order shall
remain in full force and effect notwithstanding any bankruptcy, reorganization,
or other insolvency proceedings with respect to the debtor, pledgor, or
transferor of the wildfire
recovery property
.
�
Any surplus in excess of amounts necessary to
pay principal; premiums, if any; interest, costs, and arrearages on the bonds;
and associated financing costs arising under the security agreement, shall be
remitted to the debtor, pledgor, or transferor, for the purpose of remitting
such amounts to customers via the electric utility.

����
(f)
�
Sections 490:9-204 and 490:9-205 shall apply
to a pledge of wildfire
recovery property
by the electric
utility, an affiliate of the electric utility, or a financing entity.

����
�B-7
�
Transfers of wildfire recovery property.
�
(a)
�
A
transfer or assignment of wildfire recovery property by the electric utility to
an assignee or to a financing entity, or by an assignee of the electric utility
or a financing entity to another financing entity, which the parties in the
governing documentation have expressly stated to be a sale or other absolute
transfer, in a transaction approved in a financing order, shall be treated as
an absolute transfer of all of the transferor's right, title, and interest, as
in a true sale, and not as a pledge or other financing, of the wildfire
recovery
property
, other than for federal and state income and franchise tax
purposes.

����
(b)
�
The characterization of the sale, assignment,
or transfer as an absolute transfer and true sale and the corresponding
characterization of the property interest of the assignee shall not be affected
or impaired by, among other things, the occurrence of any of the following:

����
(1)
�
Commingling of wildfire recovery charge
revenues with other amounts;

����
(2)
�
The retention by the seller of either of the
following:

���������
(A)
�
A partial or residual interest, including an
equity interest, in the financing entity or the wildfire recovery property,
whether direct or indirect, subordinate or otherwise; or

���������
(B)
�
The right to recover costs associated with
taxes, franchise fees, or license fees imposed on the collection of wildfire
recovery charge;

����
(3)
�
Any recourse that an assignee may have against
the seller;

����
(4)
�
Any indemnification rights, obligations, or
repurchase rights made or provided by the seller;

����
(5)
�
The obligation of the seller to collect
wildfire recovery charges on behalf of an assignee;

����
(6)
�
The treatment of the sale, assignment, or
transfer for tax, financial reporting, or other purpose; or

����
(7)
�
Any true-up adjustment of the wildfire
recovery charge as provided in the financing order.

����
(c)
�
A transfer of wildfire recovery property
shall be deemed perfected against third parties when both of the following
occur:

����
(1)
�
The commission issues the financing order
authorizing the wildfire recovery charge included in the wildfire recovery
property; and

����
(2)
�
An assignment of the wildfire recovery
property in writing has been executed and delivered to the assignee.

����
(d)
�
As between bona fide assignees of the same
right for value without notice, the assignee first filing a financing statement
with the bureau of conveyances of the State of Hawaii in accordance with part 5
of article 9 of chapter 490, naming the assignor of the wildfire recovery
property as debtor and identifying the wildfire recovery property, shall have
priority.
�
Any description of the
wildfire recovery property shall be sufficient if it refers to the financing
order creating the wildfire recovery property.
�

A copy of the financing statement shall be filed by the assignee with
the commission, and the commission may require the assignor or the assignee to
make other filings with respect to the transfer in accordance with procedures
the commission may establish, but these filings shall not affect the perfection
of the transfer.

����
�B-8
�
Financing entity successor requirements;
default of financing entity.
�

(a)
�
Any successor to an electric
utility subject to a financing order, whether pursuant to any bankruptcy,
reorganization, or other insolvency proceeding, or pursuant to any merger,
sale, or transfer, by operation of law, or otherwise, shall be bound by the
requirements of this chapter.
�
The
successor of the electric utility shall perform and satisfy all obligations of
the electric utility under the financing order, in the same manner and to the
same extent as the electric utility, including the obligation to collect and
pay the wildfire recovery charge to any financing party as required by a
financing order or any assignee.
�
Any
successor to the electric utility shall be entitled to receive any fixed
recovery tax amounts otherwise payable to the electric utility.

����
(b)
�
The commission may require in a financing
order that if a default by the electric utility in remittance of the wildfire
recovery charge collected arising with respect to wildfire recovery property
occurs, the commission, without limiting any other remedies available to any
financing party by reason of the default, shall order the sequestration and
payment to the beneficiaries of the wildfire recovery charge collected arising
with respect to the wildfire recovery property.
�

Any order shall remain in full force and effect notwithstanding any
bankruptcy, reorganization, or other insolvency proceedings with respect to the
electric utility.

����
�B-9
�
Severability.
�
If any provision of this chapter is held to
be invalid or is superseded, replaced, repealed, or expires for any reason:

����
(1)
�
That occurrence shall not affect any action
allowed under this chapter that is taken prior to that occurrence by the
commission, a financing entity, a bondholder, or any financing party, and any
such action shall remain in full force and effect; and

����
(2)
�
The validity and enforceability of the rest of
this chapter shall remain unaffected."

����
SECTION
3
.
�
Section 269-17, Hawaii Revised Statutes, is
amended to read as follows:

����
"
�269-17
�

Issuance of securities.
�
A
public utility corporation may, on securing the prior approval of the public
utilities commission, and not otherwise,
except as provided
in section B-4,

issue stocks and stock
certificates, bonds, notes, and other evidences of indebtedness, payable at
periods of more than twelve months after the date thereof, for the following
purposes and no other, namely:
�
for the acquisition
of property or for the construction, completion, extension, or improvement of
or addition to its facilities or service, or for the discharge or lawful
refunding of its obligations or for the reimbursement of moneys actually
expended from income or from any other moneys in its treasury not secured by or
obtained from the issue of its stocks or stock certificates, or bonds, notes,
or other evidences of indebtedness, for any of the aforesaid purposes except
maintenance of service, replacements, and substitutions not constituting
capital expenditure in cases where the corporation has kept its accounts for [
such
]
expenditures in [
such
]
a
manner [
as to enable
]
that
enables
the commission to ascertain the amount of moneys so expended and
the purposes for which the expenditures were made, and the sources of the funds
in its treasury applied to the expenditures.
�

As used [
herein,
]
in this section,
"property"
and "facilities"[
,
] mean property and facilities used in all
operations of a public utility corporation whether or not included in its
public utility operations or rate base.
�

A public utility corporation may not issue securities to acquire
property or to construct, complete, extend or improve or add to its facilities
or service if the commission determines that the proposed purpose will have a
material adverse effect on its public utility operations.

����
All stock
and every stock certificate, and every bond, note, or other evidence of
indebtedness of a public utility corporation not payable within twelve months,
issued without an order of the commission authorizing the same, then in effect,
shall be void."

����
SECTION
4.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 5.
�
This Act shall take effect on July 1, 2025.

INTRODUCED BY:

_____________________________

Report Title:

Wildfire
Recovery Fund; Securitization

Description:

Establishes
the Wildfire Recovery Fund.
�
Allows
securitization for electric utilities.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.