House finance chairwoman questions various tax goals

Hawaii’s budget problems seem to appear almost binary to 45-year-old Sylvia Luke, the new chairwoman of the House Finance Committee.

As the Makiki-Punchbowl Democratic state representative sees it, there is a good part or a bad part, a right way or a wrong way, a time to act or a time to postpone for nearly all the moving pieces in the $11 billion state budget.

In her seven terms in the state House, the Korea-born Luke has been vice speaker and judiciary committee chairwoman, but most of her time she has been on the dissenting side of leadership struggles. Today, she is in the majority and in power.

House Speaker Joseph Souki views Luke as an ally with a smart, fresh point of view.

"She is a smart woman and she is a level thinker — she will make the hard calls," said Souki, who is also a former House finance committee leader.

As one of a group of dissident Democrats who approached Souki to run for speaker, Luke said she is learning a lot from Souki.

"We constantly touch base. He has been a great mentor. We are just in constant discussion and we learn from each other," Luke said in an interview.

The state’s budget is perhaps the single most important way to set state policy because through it legislators and the governor decide what will be funded, what will be cut and what will be postponed.

Luke said she is concerned about the state’s tax policy.

"My basic question is, Are we taxing because we want to change behavior, or is it a revenue source?" Luke said.

This year, the Legislature has no specific big excise or income tax increase under consideration, but there are dozens of small taxes designed to curb sugar consumption or encourage recycling.

"My feeling is the more we attach fees and assessments to support a program, the Legislature loses oversight. My preference is to put all those things in the general fund. If they are worthy, they should stand on their own," said Luke.

Souki is in agreement, adding, "I prefer a broad-based tax rather than nickel and diming, which unfortunately is what the governor is doing because he has made a commitment not to raise taxes," said Souki.

There is neither the time nor the support for a general tax increase this year, according to Souki, but the legislative veteran said something will have to be done.

"I think in some point in time, we will need to all get together and see what the prospects for a broad-based tax increase are," Souki said.

His pupil, however, is not so sure.

"This is actually the time for us to take a conservative approach," she said.

"We need to reevaluate what government is for. Instead of restoring any cuts that have been made, it is a time to reevaluate. It is time for us to ask what different agencies and programs need additional funding."

Luke said part of the reexamination will be to look at how programs that were cut are now functioning and perhaps consolidate programs instead of simply restoring the state money.

Making those difficult choices never makes any politician popular, but for Luke, the decisions don’t appear to be as much about the nuance as about simply making them.

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Richard Borreca writes on politics on Sundays, Tuesdays and Fridays. Reach him at rborreca@staradvertiser.com.