Lawmakers split on potential GET surcharge

LIHUE — A proposal in the state Legislature that would give all Hawaii counties the opportunity to enact a 0.5 percent surcharge for public transportation projects on top of the 4 percent general excise tax is gaining some traction.

Whether that traction is good or bad, however, depends on whom you ask.

Kauai County Councilwoman JoAnn Yukimura, who unsuccessfully pushed for the seven-member board’s support for the legislation several months ago, said she is now lobbying at the Legislature to garner more support for the general excise tax (GET) surcharge proposal.

“It looks like the counties — the Neighbor Island counties as well as the City and County of Honolulu — have a chance to get some monies through this excise tax surcharge, so I believe it’s a good thing, and I’ve been talking to various senators and representatives to drum up support for it,” Yukimura said.

But some state lawmakers say they are not convinced.

“We don’t want to give authority to the counties to raise GET whenever they want to — that’s our authority, and I think that’s the feeling on this side of the chamber,” said Rep. Daynette “Dee” Morikawa, D, Koloa-Niihau. “The Senate, of course, may have different feelings, but whether it can still be done, if we all decide that we want to give the counties up to a certain amount, is difficult to tell.”

If approved, the proposal, outlined in Senate Bill 19, would allow the City and County of Honolulu to enact its 0.5 percent surcharge to benefit public transportation until the end of 2047 and require that the Honolulu Authority for Rapid Transportation (HART) complete the entire 20-mile Honolulu rail transit project by that time. That surcharge is set to end in 2022.

The bill would also grant county councils statewide the authority to approve a similar general excise tax surcharge for public transportation purposes until 2047. A deadline on when counties must enact this ordinance has not been specified yet.

All county councils statewide were previously given the opportunity to approve a 0.5 percent surcharge to benefit public transportation when the Legislature authorized them to do so in 2005. Only the Honolulu City Council implemented the surcharge, beginning in 2007.

Ten percent of all surcharge revenues are now given to the state for collecting and distributing the money. New changes in the proposal, however, would require half of that amount to be set aside and dedicated to transit-oriented development projects.

“Our basic goal is to succeed in being granted this opportunity with a reasonable timeframe to implement, and with some flexibility for the types of projects that could be funded via the additional revenues,” county spokeswoman Beth Tokioka wrote in an email.

Rep. James “Jimmy” Kunane Tokioka, D, Omao-Wailua Homesteads, said his office sent out a survey asking if residents in his district would support the creation of a county-level surcharge. He is awaiting the results of the survey.

Rep. Derek Kawakami, D, Wailua Homesteads-Hanalei, said he supports the completion of the Honolulu rail transit project to alleviate traffic congestion on Oahu’s highways and under-stands the requests made by HART and City and County of Honolulu officials to extend the current GET surcharge and fund the project.

The hang-up, however, is the provision that would allow all other counties across the state, through county council-approved ordinances, to authorize the same 0.5 percent public transportation surcharge.

“That is where things become a little blurred, and the only reason why I say that is because, when the surcharge was enacted for the City and County of Honolulu, it was specifically for rail,” Kawakami said. “As far as transportation projects on Kauai, I haven’t heard anything tangible from the county as far as specific projects.”

Authorizing county officials to enact the surcharge, he said, also raises a philosophical question: “We have many needs at the county level, and as a supporter of home rule, who’s to say the surcharge shouldn’t go to police, fire or other basic fundamental services that government provides at the county level?”

A Senate Ways and Means Committee public hearing on Senate Bill 19 is scheduled to be held at 9 a.m. Wednesday in the State Capitol Conference Room 211.

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