2010 Winners and Losers

The Winners

General Excise Tax Increase: The ill-conceived idea to raise the General Excise Tax finds itself in the “winners” column, because it failed to become law. Since GET is charged on virtually every business transaction, raising the tax would have impacted families and businesses already struggling in this economy, inhibiting any recovery. Thankfully, the Legislature was able to find other sources of funding to close the budget gap.

House Bill 2486: HB 2486 mandates 180 school days per year for our public school students, with plans to increase to 190 days in ensuing years. By placing this requirement into law, we are ensuring that Furlough Fridays will never happen again.

House Bill 1808: I co-sponsored this bill to protect public access to our shorelines. HB 1808 ensures access to Hawaii’s fluctuating shorelines for the public. The bill addresses the problem of “bad apple” beachfront homeowners, who intentionally cultivate vegetation that will prevent public access to the shoreline in front of their property. Hawaii’s shorelines are one of its greatest natural resources, and all of our residents deserve “free and equal access,” as guaranteed in the state constitution. Testimony in support of HB 1808 came from a broad group- professional land use specialists, environmental advocates, and constituents.

Capital Improvement Projects: Even in these difficult economic times, the Legislature was able to fund $10 million in Capital Improvement Projects for Kailua Schools.

Vital Nonprofit Organizations: By using monies from the Rainy Day Fund, the Legislature came to the aid of worthy nonprofit agencies in dire financial straits. Windward Spouse Abuse Shelter, the only shelter of its kind on the Windward side, was one of these deserving organizations.

The Losers

House Concurrent Resolution 56: This legislation would have required a financial and management audit of the State Department of Education. Furlough Fridays cast into sharp relief the problems in Hawaii’s public education system. An audit of the DOE would be a step in the right direction; laying the groundwork for comprehensive reform. Unfortunately, the Resolution died in the Senate, despite passing unanimously in the House.

House Bill 2421: HB 2421 began as a truly visionary bill. A slight increase on the tax per barrel of oil would have funded renewable energy and programs to reduce Hawaii’s dependence on costly imported oil. Unfortunately, the bill’s final form sends only 25 percent of the tax increase towards those initiatives, with the majority (60 percent) going to the State’s general fund, and a small percentage to agriculture and food security.

Senate Bill 2401/Senate Bill 2001: With the passage of these two bills, the Legislature suspended or repealed various high tech tax credits that were passed as part of Act 221 of the Hawaii State Legislature in 2001. Credits were structured in such a manner that they were claimed over multiple years, and provided investors in the high tech industry a certain amount of tax credits per year. To suspend or repeal the credits is not only fiscally damaging to those who invest, it also sends the message that Hawaii is not a safe place to do business. The bills may be unconstitutional, and opponents may sue the State.

House Bill 2643: HB 2643 was another unfortunate example of a clean energy initiative that fell victim to a lack of political will. The bill would have allowed homeowners to tap into Property Assessed Clean Energy (PACE) bond funding for the purpose of installing renewable energy systems on their properties. Those who opted in would repay the State through assessments added onto their property taxes. Unfortunately, political maneuvering killed the bill, and the Legislature opted instead to “study” the idea. To learn more about this revolutionary funding mechanism, read my article about PACE Bonds.