Hawaii Supreme Court to hear challenge to ballot question

The Hawaii Supreme Court has agreed to hear arguments later this month from the state’s four counties seeking to invalidate a Nov. 6 ballot question asking voters if they want to empower the state to tax investment properties in support of public education.

Thursday’s court decision to hear the counties’ petition comes amid an escalating political battle between the Hawaii State Teachers Association, which supports passage of the ballot measure, and the counties and business interests that have teamed up to oppose it.

Oral arguments are scheduled for Oct. 18, around the time the Office of Elections is expected to begin sending out mail-in ballots and days before early walk-in voting locations open throughout the islands.

The decision by the state Supreme Court to hear the petition follows First Circuit Judge Jeff Crabtree’s Sept. 7 ruling against a motion by Honolulu, Maui, Kauai and Hawaii counties seeking a preliminary injunction to block the ballot question.

Crabtree said the counties didn’t meet the standards for granting a preliminary injunction, which include a likelihood they would prevail in the case. Attorneys for the counties then took the unusual move of filing a “petition for extraordinary writ” with the state’s highest court.

The counties argue the language of the ballot measure is unlawfully vague. The question, which has already been printed on ballots, asks: “Shall the legislature be authorized to establish, as provided by law, a surcharge on investment real property?” The counties argue the word “surcharge” obscures the fact it would be a tax and that “investment real property” isn’t defined.

Voters “should know exactly what they are voting for and the counties believe that’s clearly not the case,” said Honolulu Corporation Counsel Donna Leong in a statement following the court’s decision.

If the Supreme Court finds the question is invalid, the Nov. 6 vote on the proposed amendment will be meaningless, regardless of the results.

Currently, only the counties have the authority to tax real property, providing a major source of revenue.

Opponents and supporters of the ballot measure held dueling press conferences Thursday to promote their causes.

Members of the Affordable Hawaii Coalition, a super-PAC formed by business interests, were joined by Honolulu Mayor Kirk Caldwell and Hawaii County Mayor Harry Kim in front of an apartment complex on Date Street in Kapahulu where they warned an additional property tax could increase the cost of living for all Hawaii residents and raise expenses for businesses, property owners, renters, consumers and farmers.

They also argued there is no guarantee the new revenue would go directly to public education, and as an alternative pushed for an audit of the Hawaii Department of Education to identify wasteful spending and inefficiencies.

“This is an additional tax that is being created that will affect the entire state of Hawaii, and that’s what is not being talked about,” said coalition chairman Stan Lau.

The ballot measure would only grant the state the power to tax investment properties. It would then fall to the Legislature to work out the details of any new property tax.

During a subsequent press conference held in front of Central Middle School in Honolulu, HSTA President Corey Rosenlee was joined by officials from child and student advocacy groups. He blasted opponents for using what he called scare tactics in an attempt to persuade voters to reject the measure.

The HSTA has said it would favor taxing only second homes valued at more than $1 million, which comprise less than 4 percent of residential properties in the state.

“These wealthy investors cannot win this ballot question on their own, so the only way they are going to win is by convincing people to vote against their self interest and to vote against their own children,” Rosenlee said. “And to do that, they are going to scare everyone by saying that we are going to go after renters and we are going to kick grandma out of her house and we are going to close all businesses.

“That is not true, that is deceptive and they are doing that only in the interest of scaring people.”

Deborah Zysman, executive director of the Hawaii Children’s Action Network, said additional funding generated by the property tax could, in part, help expand access to preschools and improve infrastructure at public and charter schools.

She noted that Hawaii’s per-pupil expenditures rank 45th in the nation when adjusted for the cost of living.

“If you go and visit schools you know our infrastructure is way out of date. At some places in our charter schools we have children learning under tarps. We think that is unacceptable and unconscionable.”