Selling advertising space on the sides of Honolulu buses may yet become reality after the City Council Budget Committee voted to revive Mayor Kirk Caldwell’s revenue-generating plan Wednesday.
Council Budget Chairwoman Ann Kobayashi said she’s still philosophically against bus advertising "but we have to consider all of the costs that are going to keep rising each year."
Caldwell officials estimate that allowing ads on the sides and rears of buses could generate as much as $8 million annually for the cash-strapped city. City Transportation Services Director Michael Formby told committee members that all proceeds will go back to the bus system, restoring high-demand routes including the Bus E Express bus between Ewa Beach and Honolulu.
After it was introduced by Caldwell late last year, Kobayashi held Bill 69 (2013) in her committee in January, but said she would bring it back later if the Council saw the need for revenue.
"We need a sustainable source of revenue," Kobayashi said Wednesday. "We don’t have the money."
The bill is far from final passage. Council Chairman Ernie Martin and Councilman Joey Manahan said they don’t like the idea of creating a precedent by allowing ads on the sides of buses. Two more votes of the full Council are needed before the plan can go to Caldwell’s desk for his signature.
Kobayashi said: "We’re going to try to find the money (elsewhere)."
Other Council members, however, said they’ve already tried.
"I was not in favor of this until I thoroughly reviewed every page of the city budget," Councilwoman Kymberly Pine said. She said she’s not convinced critics of the proposal have found alternative revenue sources, either.
Councilman Stanley Chang said, "To me … it’s unconscionable to think about balancing the budget on the backs of the most vulnerable in our society without at least considering and discussing a measure to increase revenues without increasing taxes or fees on a single working family, a single kupuna or a single student."
The measure advanced out of the committee 5-0, with Manahan raising reservations. He echoed many of the same objections raised by the Outdoor Circle, the nonprofit Honolulu-based conservation group credited with upholding the state’s stringent billboard law, considered one of the toughest in the country.
Formby insisted that the adminstration is staunchly against billboards and that the bus ads are not billboards.
"The mayor opposes billboards," Formby said. "It’s about transportation equity."
He pointed out that several West Oahu and Central Oahu neighborhood boards voted to support the bill to restore bus service.
Formby said he cannot guarantee that there will never be ads that someone finds offensive.
"We’re going to do our best to control the content of the ads within the law," he said. "We’re going to make sure that we have a process that would screen out the ads that are not legal, that don’t follow the rules, and don’t belong on the side of the bus."
Despite this, he said, "there will be challenges."
Formby said the administration would be amenable to coming up with a report in two or three years and leave it up to the Council to continue the program or repeal it.
Kobayashi accepted the offer, and the latest version of the bill requires the administration to submit a report in two years documenting revenue raised, administration costs and community feedback.
The latest draft of the bill states that ads could be allowed only on the sides or backs of buses. It also spells out that bus wraps would be banned, as would ads on bus shelters, benches and transit centers, and Handi-Vans.
Marti Townsend, Outdoor Circle executive director, objected to the suggestion that bus service could not be improved without the advertising plan.
"It’s unfortunate that the administration insists on holding improved bus service hostage to something that is so counter to our character and quality of life here," said Townsend, who described herself as a daily bus rider. "It’s equivalent to saying, ‘Yes, you need some lifesaving health treatment, but before I give it to you, you have to wear a T-shirt with my hospital’s name on it.’"
Townsend said that because there’s a constant need to increase service, "if you pass Bill 69, there will be a constant pressure to increase it. …"
The Outdoor Circle disputes the interpretation of city attorneys that state law already allows a company to sell advertising space on its vehicles to other entities as long as that advertising is not the purpose of the vehicle.
Tour buses and trolleys are running advertising for other companies illegally but no one is enforcing that law, she said. Selling ads on city buses would only encourage additional and more blatant violations, she said.
One scenario that might be able to stave off the bus ads is a bill currently before this year’s state Legislature that would eliminate a cap of $93 million on Transient Accommodations Tax revenues that counties divide among themselves. Lifting of the ceiling, in place since 2011, could increase Honolulu’s take to $72.8 million from the current $41 million.
House Bill 1671 is being ironed out between House and Senate conferees this week.
The Council Budget Committee on Wednesday deferred two other measures, Bills 18 and 25, that could raise additional revenue for the city. The bills propose raising the minimum property tax on nonprofit groups and others to an unspecified amount from the current $300. Representatives from both the Hawaii Alliance of Nonprofit Organizations and the Hawaii Association of Independent Schools testified against the measures.
Kobayashi said those bills may also come back.
"We’re going to look at all sources of revenues," she said. "We do want to restore bus service in the community. That’s a priority. So whatever it takes to fund that. And if it has to be bus ads, well, maybe we have to do that."
