Hawaii state legislators convened their 2015 session Wednesday with a modest agenda that might create more public accountability — both for themselves and for Oahu’s pricy rail transit project.
The lawmakers will spend much of the next several months pursuing detailed answers from transit leaders on why the largest public works project in Hawaii’s history already faces a deficit of $500 million to $700 million — and why they would need to extend the 0.5 percent general excise tax surcharge funding rail so urgently to help keep it afloat.
On Wednesday rail officials acknowledged that the project faces an even larger financial hurdle than the already hefty deficit number indicates.
On top of the deficit, they say, the transit project will eventually have to make further cuts or find a different funding source to replace the more than $200 million in bus funds that are still part of the project’s financial plan. That’s if Honolulu Mayor Kirk Caldwell is to keep his pledge not to use those dollars for rail.
House Speaker Joe Souki said lawmakers "will hold the city’s feet to the fire and closely scrutinizing its request to extend the GET tax for rail."
In her remarks before a packed Senate chamber, Senate President Donna Mercado Kim (D, Kalihi Valley-Moanalua-Halawa) linked the looming discussions on rail, and extending the tax surcharge, to Honolulu officials’ admittedly weak enforcement against illegal vacation rentals on the island.
Kim suggested Wednesday that state lawmakers should consider giving counties the option of a half-percent tax only if it’s specifically earmarked to improve housing, transportation, road improvements and transient vacation rentals enforcement.
The state currently loses tens of millions of dollars each year in Honolulu due to insufficient enforcement of the city’s vacation rentals ordinance, a recent series by the Honolulu Star-Advertiser found. One tourism expert, Outrigger Enterprises Group Executive Vice President of Hospitality Services Barry Wallace, conservatively put those losses at about $85 million annually.
Kim’s proposal would expand the potential uses for the half-percent surcharge beyond its current narrow scope for a transportation-related project. That might open up the other counties to enact the surcharge as well, not just Oahu.
Hearings on the idea would give state lawmakers the chance to scrutinize how rail officials have spent the Oahu general excise tax surcharge dollars that they’ve received so far for the project, Kim added — an amount that exceeds $1 billion.
"That’s going to be something that everyone’s going to be looking closely at," Senate Ways and Means Chairwoman Jill Tokuda said Wednesday.
Kim also called on her fellow state lawmakers to create an Office of Inspector General for Hawaii that "would investigate complaints alleging fraud, waste, abuse or corruption."
The move is necessary, Kim said after her speech, in light of recent problems such as the University of Hawaii’s ill-fated and costly Stevie Wonder concert debacle that have helped to disillusion much of the public.
How independent the new inspector general office would be remains unclear, however. Kim said that draft legislation so far would have the governor appoint the inspector general — just as the attorney general is. As legislators work out the bill, "we’re trying to some degree to keep it independent," Kim said after her speech, referring to the inspector general’s role.
"I would look forward to the legislation and what that opportunity would look like," Gov. David Ige told reporters in a state Capitol hallway shortly after Kim’s speech. Ige, the Senate’s former Ways and Means Committee chairman, added, "Obviously, we need to be aware of what the cost is" for such a program.
After Hawaii voters set a record low for general-election turnout in November, at 52.3 percent, Kim proposed Wednesday that the Aloha State should follow in the footsteps of Washington state and Oregon and phase in "all-mail" voting during the next two election cycles, in 2016 and 2018.
Kim also proposed that the state devote hotel room tax dollars to help restore beaches and preserve marine environments across the islands. The state Department of Land and Natural Resources added 24,000 cubic yards of sand to Waikiki Beach in 2013 at a cost of $2 million, but a UH study found that about a fourth of that sand was gone a year later, she said.
Meanwhile, Senate Minority Leader Sam Slom — the chamber’s lone Republican — argued against any proposal to extend the GET surcharge, saying "we cannot throw good money after bad" to address rail’s looming budget deficit.
Senators called for a quick recess in the middle of Slom’s remarks when they were concerned he might be experiencing a health problem, as Slom appeared somewhat lethargic in his delivery. He was able to finish his speech and then left the chamber on his own power to be examined by physicians, including fellow senator and Hawaii island physician Josh Green.
Slom later returned to the chamber for the rest of the session with his colleagues.
He later said he was fine, adding that the problem was he hadn’t eaten anything for several hours.
House Speaker Souki’s address, while short on details, called on lawmakers to look at creating better access to medical marijuana, adding that it is something the state should have done 15 years ago.
The issue of genetically modified organisms, a hotly debated item last year, is expected to be debated again this session. Souki said, however, that permitting or banning GMOs should not be the point of discussion.
"Rather, we should be discussing how to facilitate choice and an open market, allowing us to individually decide whether we want to consume GMO products or not," Souki said. "I believe that’s an issue we can tackle with a good chance of success."
Mahealani Kahanaoi of Papakolea staffed a table in the Capitol atrium with other Hawaiian sovereignty activists and said Native Hawaiians should not rely on the Legislature to improve their lives.
"Our people are not dependent on the decisions and results that come out of the legislative body," Kahanaoi said. "We are independent. We’re not looking for them to make things better. If we become dependent on them, it becomes a cycle that keeps repeating. We know who we are."
Star-Advertiser reporters Dan Nakaso and Allison Schaefers contributed to this story.
CORRECTION: The Oahu rail transit project faces a $550 million to $700 million deficit. An earlier version of this story and a story in the print edition said the deficit was $500 million to $750 million.
