Chamber of Commerce Hawaii donates $600,000 to help fight tax ballot measure

The Chamber of Commerce Hawaii donated $600,000 Monday to a political action committee formed to encourage residents to vote “no” on a ballot measure in the general election that asks whether the state should be empowered to levy property taxes in support of public education.

The donation to the Affordable Hawaii Coalition PAC appears to be the largest contribution ever made by the chamber, said Sherry Menor-McNamara, the organization’s president and CEO.

The proposed constitutional amendment, backed by the Hawaii State Teachers Association, has elicited strong opposition from business interests. While HSTA has argued that the intent of the measure is to only tax second homes valued at more than $1 million, the Legislature would have discretion to decide what types of properties would be taxed and at what rates, which has worried businesses.

“We made this investment to ensure that businesses, their employees and all residents of Hawaii are made aware of and understand that this (constitutional amendment) will raise the cost of living for everyone,” said Menor-McNamara by email.

Menor-McNamara said an issue with the proposed constitutional amendment is that nothing says that “the ‘surcharge’ will only apply to investment properties over $1 million in value.”

“This measure affects all investment property including local homes, commercial and agricultural properties, and mom and pop stores. Also, there is no guarantee the money will go directly to teachers or public schools…it is inaccurate to say otherwise,” she said.

The HSTA, which is waging a comparable effort to convince voters to vote “yes” on the measure, has countered that opponents are employing scare tactics to garner voter opposition. The teachers union says additional revenue is needed to boost teachers’ salaries and improve classrooms.

Specifically, the ballot measure asks voters whether they want to amend the Hawaii Constitution to allow the state to tax real investment property — a power that currently resides only with the counties — for the purpose of funding public education. The proposed change to the Constitution requires approval by a simple majority of voters. Blank votes will be counted as “no” votes.

The $600,000 donation to the Affordable Hawaii Coalition is in addition to another $155,000 in donations that the committee raised through Sept. 26, according to the latest financial report filed with the Hawaii Campaign Spending Commission. Among those businesses contributing $10,000 or more are Hawaii Petroleum, Watumull Properties, WC Maui Coast Hotel, Shidler Pacific Advisors, Dowling Company, Park Hotels and Resorts and Lanai Resorts.

HSTA for Schools Our Keiki Deserve, the committee formed by the teachers’ union in support of the ballot measure, had raised $600,000 as of Sept. 26, most of which was provided by the HSTA. The National Education Association also donated $100,000.

Both sides have already begun spending tens of thousands of dollars on communications and public relations.