Sen. Tokuda could face ouster over rail project

The pressure on state lawmakers to provide extra funding to bail out the Honolulu rail project has become so intense that some senators are reportedly lining up votes in a power play that could sideline Senate Ways and Means Chairwoman Jill Tokuda.

Tokuda is key to the rail debate because as chairwoman of that committee, she controls appropriations and tax measures in the Senate. It is unclear yet whether the talk of removing her is a genuine reorganization effort or is designed to prod her into supporting more funding for rail.

Some lawmakers have been grumbling privately about the lack of budget information that is provided by Tokuda to other senators — an issue that prompted an angry exchange between Tokuda and state Sen. Donna Mercado Kim in a recent closed-door caucus. Those complaints may also be fueling talk of replacing Tokuda, but no senators would discuss the issue publicly.

In February, Tokuda publicly scolded Honolulu Mayor Kirk Caldwell for returning to the Legislature in 2015 and again this year to ask lawmakers for extensions of the half-percent Oahu excise tax surcharge to provide more money for the rail project, and she refused to provide the city with anything close to the amount of money that Caldwell is requesting.

The rail project is vastly over budget, with cost estimates for the city’s 20-mile, 21-station rail project from East Kapolei to Ala Moana Center soaring to nearly $10 billion, including financing costs, from $5.26 billion in late 2014. The project is funded mostly from the excise tax surcharge, which generates about $250 million per year and is scheduled to end in 2027.

The Legislature extended the tax surcharge in 2015 at Caldwell’s request, but Tokuda would not approve a bill authorizing another extension this year. Instead, she advanced a draft of Senate Bill 1183 that would reduce the state’s share of the rail surcharge, a change that would provide only about $300 million in additional funding for the rail project.

Caldwell warned that would not provide nearly enough money to salvage the project, but Tokuda’s proposal was approved by the full Senate in a 25-0 vote in early March.

Now, Senate President Ron Kouchi and Senate Transportation Committee Chairwoman Lorraine Inouye are floating a new proposal that would extend the rail surcharge by 10 years to 2037, which would provide the rail funds that Caldwell says the city needs.

The new draft bill would also commit 19 percent of the revenue from the surcharge to the state Highway Fund to help finance highway projects, and 1 percent would be retained by the state tax department to cover the cost of administering the tax.

Sources say that Tokuda has balked at that idea, which has helped fuel talk of replacing her with someone willing to accept the new rail tax proposal. Tokuda declined repeated requests for an interview Friday.

Kouchi said it was not true that Tokuda’s position within the Senate was in trouble if she didn’t agree to the new version of the rail bill.

“Absolutely not,” he said. “She had been doing a fantastic job.”

House lawmakers have proposed an entirely different version of the bill that would extend the excise tax surcharge by just two years to raise an extra $1.2 billion for the rail project. Caldwell has said that measure would still not provide enough money to fully fund the rail project, and could force the city to raise property taxes by 8 to 14 percent to make up the difference.

Lawmakers agreed most senators support a longer extension of the rail tax surcharge than the House has proposed. The bill that Tokuda’s committee produced, which has no extension of the tax, does not reflect that majority view.

That might put Tokuda in a precarious position. The issue of rail is “big enough to remove a WAM chair,” said one senator, who would discuss the matter only anonymously. That senator was prepared to vote to replace Tokuda.

The political logic behind the new Senate proposal is that if it fails and lawmakers are finally forced to accept the two-year extension crafted by Rep. Sylvia Luke, “at least it’s her fault with all of the unions,” said another senator.

Both the construction trade unions and the Hawaii worker unions have been longtime and committed supporters of the rail project, and union support affects the Senate organization, senators said.

The House and Senate need to meet in conference committee in the next week to negotiate what will finally emerge when lawmakers wrap up this year’s session, but no meeting has been scheduled yet.

When asked whether Tokuda agreed to advance the new draft Senate bill, Kouchi said he would have to check to see whether Tokuda signed off on the hearing notice, a step she would need to take in order for the new bill to go to conference committee.

“Well, I had worked with Chair Inouye and gave it to her. I gave it to Chair Tokuda. Nobody so far has said that they weren’t for floating the conference draft,” Kouchi said Friday. He said senators suggested the conference committee meet on the rail bill Monday, or the committee can meet later next week, but he does expect it will meet.

“It just acknowledges that it needed to be longer than the two years,” Kouchi said of the surcharge extension. “That’s why we’re suggesting the 10 — we didn’t agree with perpetuity or 20 (years). We think we need to have a timeline that ensures that people try to do the best job they can and maintain costs the best way they can.”