Barrel tax, welfare shutdowns among measures rescued

Maui legislators override governor's vetoes

The Maui News
May 2, 2010

By BRIAN PERRY, City Editor

State lawmakers were kept busy Thursday, the last day of this year's legislative session, overriding nearly a dozen vetoes by Gov. Linda Lingle.

In nearly all instances, Maui County's all-Democrat, nine-member contingent held ranks with members of their majority party.

A notable exception came with a "no" vote from state Sen. Roz Baker on the $1-per-barrel tax increase on petroleum products. She was one of six senators to vote to uphold the governor's veto of the measure that has come under fire for raising fuel cost in Hawaii where electricity and gas prices are among the highest in the nation.

Representing West and South Maui residents, Baker said she was unhappy with the Legislature's "very piecemeal" approach to tax measures, saying she would have preferred a straightforward, temporary increase to the general excise tax to bridge the state's projected $1.2 billion budget shortfall.

The barrel tax increase is "very regressive," she said, hitting Neighbor Island residents harder than people on Oahu, where gas prices are not as high.

A general excise tax would have been a "fairer way to do it," she said.

Baker said a general excise tax increase would not be something done lightly, and the proposal she supported would have doubled the standard deduction for food, rent and child care credits to help low- and moderate-income families.

Instead, the Legislature targeted tax credits for high-tech businesses that help create employment, jobs and wealth, she said.

"People are going to be very unhappy, and that's why I voted no. It's a bad bill," Baker said.

State Sen. J. Kalani English, whose district includes East Maui, Upcountry, Molokai and Lanai, said increasing the barrel tax meant the Legislature didn't need to touch transient accommodations taxes that have gone to the city and counties. (Maui County has been counting on receiving $17.5 million in TAT money, also known as the hotel room tax, to balance its budget in fiscal 2011.)

Central Maui Sen. Shan Tsutsui said he supported the barrel tax increase because it would help build renewable energy programs and reduce Hawaii's dependence on fossil fuels.

He said he wasn't sure how much the tax increase would cost consumers in the short run, but over the long term he contended that the investment in renewable energy would reap "huge savings" for Hawaii residents.

South Maui Rep. Joe Bertram III said he believed that the barrel tax hike would mean only "pennies per gallon" for consumers. Perhaps higher gas prices would encourage people to ride buses, walk or use bicycles, he said.

It's "unfortunate to do it this way," Bertram said, but "we need this type of investment to move this switch away from oil."

Rep. Gil Keith-Agaran, whose district includes a portion of Wailuku, Kahului and lower Paia, said money raised through the barrel tax increase also would save jobs of agricultural inspectors.

West Maui Rep. Angus McKelvey said he supported the barrel tax measure with "severe reservations," but he voted for it to preserve hotel room tax money for the counties and to keep isle agricultural inspectors.

He said a general excise tax hike would hurt small businesses and the visitor industry by making all goods and services more expensive.

Rep. Joe Souki, who represents residents of Wailuku, Kahakuloa and Waikapu, said he thought the increase to consumers would only be a negligible amount.

Another vetoed bill overridden Thursday was a measure to prevent the closure of welfare application offices on Neighbor Islands.

Maui Democrats all supported the veto override, saying that while they appreciated the move for greater efficiency in processing welfare applications, the Lingle administration was rushing into an untested system relying on the Internet and automation. They said it was unclear and that some people, particularly those who use English as a second language, would fall through the cracks in the system.

They said the measure would allow the new system to be tested on a pilot basis on Oahu, where the bugs could get worked out before it spreads statewide.

The Maui lawmakers also backed the veto override of a bill requiring contractors to hire 80 percent Hawaii residents for public projects. They said Hawaii residents need jobs, particularly in this tough economy. They also said other states have adopted similar measures that have withstood constitutional challenges.

* Brian Perry can be reached at citydesk@mauinews.com.

Original article URL: http://www.mauinews.com/page/content.detail/id/531098.html

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