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Mayor’s rail push inappropriate

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Mayor Kirk Caldwell certainly caught a break when the governor decided not to veto the rail tax extension. That shouldn’t mean he gets a pass for what was a disingenuous presentation on the subject to state lawmakers — and the rest of the taxpayers — last session.

The decision to lift the veto threat from the tax extension, which surely came as a great relief to the Honolulu Authority for Rapid Transportation, was ultimately the right one.

As Gov. David Ige noted in his statement, “HART is short in terms of the funds required for that first segment.” He added that the bill “does assure that there will be adequate funds based on the current budget projections.”

That was enough justification to extend the half-percent surcharge in the state general excise tax Oahu residents pay, the local money underwriting the rail project. Originally set to expire in 2022, the 4.5 percent GET now will be assessed through 2027, which ought to provide a safer financing margin as construction heads toward town and costs are anticipated to rise.

But getting that concession out of the Legislature, which was loath to pursue a tax increase, was a heavy lift. Caldwell was making the pitch for extending the tax indefinitely, but it soon became clear the key players in the Capitol would need a hefty push even to grant what the city administration and HART viewed as the minimum five-year extension.

Caldwell gave it to them, in the form of a hard sell that was long on doomsday projections and short on facts.

“Let’s say we didn’t get any more money. To raise the money to pay and operate this system, we’re talking … about raising real property taxes in the 30 to 43 percent range,” the mayor told lawmakers soon after the session opened in January.

What he didn’t tell people was that the costs making such a hair-raising tax hike necessary included those the city would incur from expanding the rail system beyond its current, approved 20-mile alignment. But that’s never had the full discussion it warrants, and it wasn’t what was on the table.

On the table was the existing East Kapolei-to-Ala Moana project, the one that’s estimated to be $900 million in the hole upon its completion. According to emails more recently released by HART, estimates for the property tax increase required to cover that shortfall were more in the 5.6 percent range, with an additional 8 percent for operational costs.

An additional property tax boost of 24.8 percent would be needed for envisioned — but not-yet-approved — extensions to West Kapolei and the University of Hawaii’s Manoa campus.

At the time, the administration was not forthcoming with that breakdown, despite repeated requests from the Star-Advertiser. That certainly tarnished the administration’s credibility before the Legislature, which now likely will give the city the third degree in future grillings — as it should.

How much better it would have been had Caldwell simply laid out the facts plainly. That is the least that Oahu businesses and taxpayers had a right to expect, given that their wallets were about to be tapped for five more years.

Among the other bills Ige weighed before declaring them subject to the veto pen:

» Ige seems poised to veto a sex trafficking measure, Senate Bill 265. This is disappointing, because the measure would have focused prosecution on the traffickers rather than the sex workers themselves, many of whom would get the social outreach they need more than jail time.

The governor seems to think prosecution of prostitution would be hobbled. The bill does need some fixes, but the change in focus to charge the traffickers is crucial. Lawmakers should take another stab at implementing this needed course correction if this bill falls, as seems likely.

» He is correctly leaning toward vetoing SB 349. The measure would create a new renewable-energy tax credit, which he said would violate the U.S. Constitution commerce clause because only Hawaii companies would qualify.

» The work of graduate assistants at the University of Hawaii is essentially an apprenticeship, and putting them in a new collective bargaining unit, as House Bill 553 proposed, would add excessive costs to an already fiscally strapped university system. Vetoing that would be the best outcome.

But without question, the rail issue topped the list of issues Ige was weighing. He made the right call there, but it was right because of the financial realities of the project — not because he found the mayor’s spin persuasive.

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