Did you hear the caroling last week? Maybe you saw the Christmas decorations brightening all the stores.
No? Well, you must not have been at Honolulu Hale. As far as the City and County of Honolulu was concerned, Christmas came when the Council started plowing through Bill 40 — which if approved, would allow the city to raise the hotel room tax 3%.
The money would be used to replace the money lost when the state took away all the subsidies provided to the counties. Maui and Kauai are also implementing their own hotel room tax, but there’s a catch with Honolulu.
There’s a lot of talk that the new tax would go not just for paying the police and fire services, fixing the parks, improving city services and helping the poor — no, the idea is to mount a tourist-funded rescue mission.
Cue Jingle Bells, Santa Claus is coming.
Yes, the hotel room tax is seen as a way to bail out rail, pay whatever is needed to meet the speculated $3 billion deficit and finish that money-sucker. Taxpayers would be off the hook; they might not even notice.
The big shots, however, already love, love, love the idea of raising hotel room taxes 3% and using whatever portion they can nab to finish rail.
From Linda Schatz, developer and wife of Hawaii’s senior U.S. senator, Brian Schatz, to the all-powerful Carpenters Union, Honolulu’s heavyweights were testifying in favor of raising hotel room taxes for rail.
The Honolulu Star-Advertiser’s City Hall reporter, Ashley Mizuo, gave the details.
“Bill 40 would levy a 3% city transient accommodations tax on visitor accommodations. It would be imposed in addition to the state’s current 10.25% visitor tax. Counties received a total of about $130 million annually, with Honolulu County receiving 44%, or about $45 million. Honolulu’s proposed TAT would put a 3% tax on all gross rental proceeds from establishments such as vacation rentals, hotels and timeshares,” she reported, adding that Mayor Rick Blangiardi voiced support for the proposed tax, “but stopped short of advocating for funds to be used on the city’s rail project.”
“If a fixed percentage of at least half of the TAT to the county goes to rail construction, operations, and rail-focused activities such as TOD (transient-oriented development), it will help create ripe conditions for housing redevelopment and walkable communities,” said Linda Schatz, principal in Schatz Collaborative.
“A fixed percentage of the city’s Transient Accommodation Tax (TAT) dedicated to rail is exactly what the county needs now to continue this project,” said the Hawaii Operating Engineers.
“This new revenue source, a tourist tax, comes from our visitors rather than our residents … A dedicated local revenue source will allow for the completion of a system that will transform Oahu,” said the General Contractors Association.
“Dedicating a percentage of the TAT will also pay for the ongoing operations and maintenance of the system after construction has been completed, again, without the need to raise property taxes,” added the Carpenters Union.
Mufi Hannemann, former mayor and one of the early city officials pushing for rail, testified as president of the Hawaii Lodging & Tourism Association.
He urged that new tax dollars go for “projects more directly associated with tourism impacts like trail management, beach and park maintenance, additional support for first responders, and the provision of adequate public safety staffing at beaches.”
No direct mention of using the money to save rail — but with the cheers already echoing through City Hall, what more needed to be said?
Richard Borreca writes on politics on Sundays. Reach him at 808onpolitics@gmail.com.