Trade groups, unions urge tourism bill veto

The Hawaii Lodging & Tourism Association and more than 30 organizations are urging Gov. David Ige to veto a bill that takes lodging taxes away from the Hawaii Tourism Authority and counties.

The groups sent a letter to Ige on Tuesday asking him to veto HB 862, which takes away the dedicated funding that HTA has had since its founding. In fiscal year 2019 the lodging tax brought $631 million to the state, and HTA received $79 million of it.

Lawmakers also used the bill to eliminate the counties’ $103 million share of transient accommodations taxes while giving each county the right to raise their island’s TAT by 3 percentage points.

Ige is still reviewing bills and has until June 21 to release his intent-to-veto list.

Mufi Hannemann, HLTA president and CEO, said, “It’s clear that the labor and business community are very concerned about this bill.We know that the governor has expressed concern about this bill and that he has a difficult task before him. If there’s a concern that there is not widespread support for a veto, hopefully this letter will dispel that.”

Hannemann said the letter also was signed by national organizations with local ties like Airlines for America, and the American Resort Development Association.

The Waikiki Neighborhood Board on Tuesday also passed a resolution to urge Ige to veto the measure. The Waikiki board chairman, Bob Finley, said the board viewed HB 862 as a blow to the visitor industry and all of the Waikiki residents who work there.

”Adding 30% to the TAT gives us the highest lodging taxes in the nation and makes us noncompetitive,” Finley said. “We felt very strongly that this was a bad idea. There are still 60,000 workers on the bench, and many of them are people that we know. Our people have blown all their money. Their savings are gone. Most of the support programs have failed.”

Finley said the board also objected to the fact that state legislators created the bill through gut-and-replace, which didn’t allow for any public input.

“The Legislature got that $1.6 billion (in federal support) that paid the bills. Why do we have to rob this particular pot?” Finley said. “I don’t think any of the people who made that decision have ever managed a hotel, served a cocktail to tourists or cleaned toilets.”