Janet Gusukuma-Hamilton grew up on the Big Island and remembers her first visit to 'Iolani Palace as a student from Laupahoehoe High School.

"It's a unique place. It's a place I always love to visit," Gusukuma-Hamilton said yesterday during her third visit to the palace.

Gusukuma-Hamilton, who now lives in Stockton, Calif., and was here on vacation, praised a proposal by Gov. Linda Lingle to spend $4.5 million to improve an antiquated air-conditioning and electrical system for 'Iolani Palace. The money would reduce a more than $35,000 drain on the palace's budget and help with financial problems that have plagued it for years.

She said she likes the idea of the state stepping in to help the financially troubled landmark, which is operated by the Friends of 'Iolani Palace. The Friends are running at an average monthly deficit of about $40,000.

"It's a good idea because it's a place that appeals to both kama'aina and tourists," Gusukuma-Hamilton said as she sat inside the gift shop in the Halekoa barracks building on the palace grounds.

Pamela Kawai, a Makiki resident, also was visiting the palace yesterday with her family as a part of Kama'aina Day. She wasn't entirely sold on the idea of spending millions on fixing the palace's air conditioning.

"I like that they want to put money into the palace, but I'd like to see them use it to restore the palace to the way it was and then preserve it," she said.

Kawai said this was her fifth visit to the palace and it holds a special place in her heart.

"There's a lot of history in this building. We should really do more to preserve it," she said.

The state Department of Land and Natural Resources also is paying $279,169 for accessibility improvements to the Kana'ina Building and the 'Iolani Barracks. Both structures, as well as the palace, will stay open to the public during the work, expected to be done in June.

Palace operations have had financial difficulties since the mid-1990s, when the state reduced and then eliminated the Friends' $500,000-plus annual subsidy.

Mark Sicat of Wahiawa was visiting the palace with his wife, Melissa, and two children yesterday. He said he likes the idea of putting more money into the palace renovations.

"We definitely have to keep the historic roots strong," he said.

Reach Loren Moreno at lmoreno@honoluluadvertiser.com.