Hawaii Revised Statutes Division 1. Government § 78-30

(a) Each chief executive may establish a wage and salary reduction benefit program which qualifies as a cafeteria plan within the meaning of section 125 of the Internal Revenue Code of 1986, as amended. The cafeteria plan shall allow eligible employees to elect to reduce their pretax compensation in return for payment by the jurisdiction of the expenses of eligible benefits.

(b) In addition to any other powers and duties authorized by law, each chief executive may enter into all contracts necessary to establish, administer, or maintain the cafeteria plans.

(c) The contributions, interest earned, and forfeited participant balances may be held in trust outside of the jurisdiction's treasury for the benefit of the participants and the plan. The funds in trust shall not be subject to the jurisdiction's general creditors. Interest earned or forfeited participant balances may be used to defray participant fees and other administrative costs.