HILO — Measures introduced in both the state House and Senate this week would increase gas taxes and other vehicle fees to generate additional money for the State Highway Fund.
House Bill 1054 and its companion, Senate Bill 1280, passed first reading in both chambers Thursday.
If approved, the proposed legislation would increase the state gas tax from 16 cents to 21 cents per gallon on Hawaii Island and other neighbor islands, and to 22 cents on Oahu.
The legislation, which was proposed by Gov. David Ige’s administration, also would increase annual vehicle registration fees by $5 — from $45 to $50 — and increase tax rates for each gallon of diesel oil, as well as gasoline or other aviation fuel used for airplanes, by 1 cent.
The state vehicle weight tax also would increase. Those rates depend on the weight of the vehicle.
District 4 Sen. Lorraine Inouye, chairwoman of the Senate Transportation Committee, could not be reached for comment by deadline.
The proposed increases could impact local businesses.
Harolene Mendonsa, owner of Ace 1 Taxi in Hilo, said any increase in gas prices would hurt her business and drivers.
“For me, yes, any amount of gas that goes up hurts us badly because (drivers are) not my employees,” she said. “They use my vans at Ace 1 to go out and work, but they pay their own gas.”
The company is one of several that participates in the Hawaii County Mass Transit Agency’s shared ride taxi program, which allows participants to purchase taxi coupons for cab rides in and around Hilo.
According to information included with the bill, highway systems have not kept pace with the growing economy, land use and increased demands for travel.
“Programmatic and project needs far exceed the available resources,” a justification sheet attached to the bill reads. “The land transportation system will continue to deteriorate as demand for travel continues to increase and costs to manage, construct and administer the system increases.”
As fuel economy of vehicles improves and the use of electric, hybrid and alternative-fuel vehicles increase, “it is clear that the current gas fuel tax is not sustainable for future highway funding,” the document states.
According to information provided by the state Department of Transportation, an increase of 5 cents per gallon of gas would raise an extra $27.2 million in revenue.
The proposed change to the vehicle weight tax is expected to generate an additional $10.12 million in revenue, while higher registration fees will generate nearly $5.6 million, for a total of $42.9 million in additional funds, the DOT said.
Of those funds, figures provided by the DOT estimate that Hawaii Island would receive $1.25 million for safety improvements, $2.38 million for operations, and $5.5 million for improvements in both fiscal year 2020 and 2021 — a total of $9.13 million each year.
Email Stephanie Salmons at ssalmons@hawaiitribune-herald.com.
Hawaii continues to tax their residents to death in order to keep wasting money on boondoggle projects like the Honolulu rail system which is a true joke to any sane taxpayer. Gas prices under $1.90 a gallon in many other parts of the country. Time to quit bending over without a whimper.
The gasoline tax is one of the most regressive taxes you find in the USA. Typically people with lower incomes spend less money on vehicles and lower priced vehicles tend to get the worst gas mileage. Couple that with the fact that many Hawaiian residents have to live a significant distance from their place of employment and the tax disproportionately effects those who can least afford the tax.
Now there is an influx of electric, hybrid and high gas mileage vehicles that are purchased by the wealthy and upper middle class since these vehicles are EXPENSIVE, so there is actually less revenue to the state for highway construction and repair even with more vehicles on the road. How do we fix this? Well maybe the state needs to keep fuel taxes the same or lower to encourage driving and begin to have “ad valorum” taxes for vehicles that are hybrid/electric. This can be at the point of sale or likely more effectively when the vehicle is registered each year. Now everyone has “skin in the game” and the added value taxes on the high priced hybrid/electric vehicles is borne by those who wealthier and can better afford the tax.
More Robin hood economics. Fuel tax is anything but regressive, rather it is a use tax. Dirty energy fuels are highly subsidized, from extraction through the tailpipe, with all the all environmental and public health costs passed on to all us to pay, one way or another .
The fossil fuel industry is the most highly taxpayer-subsidized sector — annually to the tune of greater than $5 trillion USD globally (IMF/World Bank study 2017) and with over $800M of that total being paid by US taxpayers.
EV’s are now also very cost competitive with fossil-fueled models – do your homework. Hawai’i fails to provides any economic purchase incentives for EV consumers, and the state taxes EV’s equally with dirty fuel vehicles (there is no free-ride) while making noise about transitioning Hawai’i to clean (emission-free) transportation.
Meantime, the roads in West Hawai’i continue to deteriorate, which adds costs to all who travel over them (wear and tear and added fuel costs for vehicle owners, see recent supporting studies), while the County ignores the more basic road maintenance needs, allowing key connector roads like Hini Lani to return to gravel.
Don’t EV’s burn fossil fuels indirectly? Won’t more EV’s mean more demand for fuel oil and power plant MW production which is already an issue? Seems like either way we are screwed( . Y . )
A couple of points to consider re EV fueling impacts. Here in Hawaii we are blessed with nearly year-round sunny (solar production) days, and there is no better transportation fueling marriage than owning an EV, fueled by PV on your rooftop – in other words powered by the sun, not imported dirty energy powering HELCO’s diesel power plants (who are on a slow trajectory to transitioning to utility scale (local) solar production and consumption.
Data an 2017 EPA study on power plant greenhouse gas emissions concluded that electric vehicles (EV) in the US are even cleaner than their fossil fuel counterparts, regardless of the fueling source.
Climate change emissions created by driving on electricity depend on where you live, but on average, an EV driving in the U.S. today is equivalent to a conventional gasoline car that gets 80 MPG, up from 73 MPG in 2017 (UCS study). The average Hawaii pickup / SUV is lucky to get between 10 and 20 MPG, while most gas-powered passenger cars are little better.
So yes, it is best to power your EV via a local fuel source (the Sun), but even without that advantage, fueling up via HELCO adn their high cost of power today still translates to only a $1.45 per gallon equivalent, and carries with it far less environmental impacts (locally and globally) than the alternative, waiting inline (e.g. COSTCO) to fuel up and fund a dirty energy supply-chain in which our island state is far too dependent.
One last point, EV’s have about 85% less components to maintenance than their fossil fuel counterparts, and that translates into more money in your pocket, and a substantial lower cost of operating ownership.
You seem to have the answers to the problem of fossil fuels.One problem keep popping in to my head, being on fixed income and an array of 24 solar of panel on my roof, due to be worthless in 12-15 years, what to do with them. We are on a island everything is shipped in and out, everything is done by comity of sorts and it seem the can is kicked down the road forever. The car companies and Telsa are way subsidized for electric car industries. The sun has to shine, the wind has to blow. The state keeps increasing my taxes on everything I own, on a fixed income and sinking down into poverty levels, will buying an electric car help me out. Socialism may be the only way out. Who pays for that, you.
You have no idea about what you are talking about. Fuel taxes are among the most regressive taxes in this country. Ask any economist or just read what I posted using comprehension.
You also have no idea about what you are talking about with EV’s. Explain to all of us how an owner of an EV or Hybrid pays the same tax as an owner of an internal combustion engine auto. EV owners have been given tax breaks by the Fed and State (although full disclosure, many are expiring or being reduced), EV owners pay no fuel tax and Hybrids pay much less fuel tax for the same amount miles travelled/used. In many areas there are FREE charge stations, and all of these benefits come to some of the most expensive automobiles you can buy
Finally EV’s are not as pure as the driven snow…..
Rare earth batteries (Lithium) are some of the most deadly materials used in the transportation system today. These minerals also largely strip mined in countries who have no pollution controls in place, and disposal of these batteries are exposing landfill to chemical hazards.
And don’t forget the power source. Electricity isn’t all generated by wind or solar. In more than 50% of the supply of electricity to these EV’s you can state these vehicles are natural actually powered by Oil, coal or diesel fuel.
Goodness, not again. Time to vote in a third party. These folks are just tax and spend addicts.
Getting it from both ends. Two pals, Kim and Ige, putting it to us good. Keep voting them in……
Perhaps FREEDOM is a thing you can’t put your finger on, but you’ll know when it’s GONE !
Taxation is theft. Wealth Confiscation is Communism.
Bitcoin is freedom.
https://uploads.disquscdn.com/images/2b3f330217016aff39d5bad845b91e4aaa32c7259a9d490fabe9520e2407d920.jpg
You voted for Four more years of abuse. Well it’s starting up. Love our Asian politicians their so nice to the people of Hawaii. We’re called the piggy bank people. Ever notice theres no protest. Well to look at the stars there’s protest. But to constantly steal our money, it’s all GOOD.
Tax, tax, tax, spend, spend, spend! Its all these liberals know. All that and we still deal with 3rd world everything in this state.
Gotta love the Democrats tax n spend in full mode …..quit bitching….you voted for them.
If the electric vehicles are escaping “paying their fair share” to support roads….where is the special electric vehicle tax increase? Or do non electric vehicle owners have to continue subsidizing these deadbeats?