HILO — Mayor Billy Kenoi is recommending the County Council pass a one-half percent increase in the general excise tax, but not all council members are on board.
The council Finance Committee will hold a public hearing at 5 p.m. today to let the public weigh in on the added tax. The public can testify in person at the West Hawaii Civic Center, or by video conference from Hilo council chambers, the Waimea council office, the Naalehu state office building or the Pahoa neighborhood facility.
No decision will be made at the meeting.
Council members have been unsure about the measure, with Puna Councilman Greggor Ilagan the only flat-out “no” so far. The council members, with an election looming, are asking their constituents to come forward and speak their minds.
But the term-limited Kenoi, who will no longer be in office when the measure would go into effect in 2018, told council members during a budget briefing Wednesday they should pass the measure, Bill 165, because the county might need the money.
“I think it’s one good idea,” Kenoi said. “Yes, you have to answer to the voters. … Although maybe very unpopular, I think that it’s something that this council, this body, got to seriously consider.”
Kenoi said the county’s infrastructure is in a constant state of need, and, other than raising property taxes and fees, the county has nowhere else to find the money.
“People have to be very honest. We don’t have Sen. Daniel K. Inouye anymore,” Kenoi said. “Who are you going to call for federal dollars?”
Inouye, who died in office in 2012, was a powerful, longtime U.S. Senate leader who brought Hawaii County $113 million in one year alone. The county budget, in comparison, is $462.7 million.
The current general excise tax is 4.166 percent. The tax hike would take that to 4.666 percent.
The added tax must be used for transportation projects, under the authority the state Legislature and Gov. David Ige gave the counties last year. The County Council must have a bill passed and signed by the mayor before July 1, or the ability to enact the tax expires.
The GET surcharge would bring $25-$35 million more annually to Hawaii County.
Neither the Hawaii Island Chamber of Commerce nor the Kona-Kohala Chamber of Commerce have testified before the council or returned phone calls from the newspaper over the past two weeks seeking their stance on the bill.
But another business group, Hawaii Island Realtors, has come out in opposition.
“Any increase in the general excise tax is an increase to our cost of living as well as our cost of doing business,” said Joy Dillon, in Hilo, reading a letter to the council from the Hawaii Island Realtors.
The members of the public who have weighed in so far strongly oppose the added tax.
Ilagan went along with the council’s 6-0 vote to take Bill 165 to a public hearing, but he said he did so simply “to go through the process.”
“I want funding for transportation in Puna, but I firmly believe it should not be through a GET surcharge,” Ilagan clarified in an April 6 letter to constituents.
Hilo Councilman Aaron Chung, who elicited Kenoi’s opinions on the tax hike during a council briefing, seemed inclined to continue the process a little longer than Ilagan.
“If it’s approved, we have until 2018 to tweak it,” Chung said. “We’re here and we’ve got to deal with it.”
To Kenoi, it all boils down to having what he calls another tool in the toolbox.
“When the state gives you something, which very rarely happens, you got to grab ‘em,” Kenoi said. “I think the County of Hawaii should take the opportunity to have that option available, because we don’t know what tomorrow is.”
