Representative Joy San Buenaventura’s Response to Questions on Special Session on Honolulu Rapid Transit System

Representative Joy San Buenaventura

As other legislators have noted, this questionnaire is premature in that we have not been told what we will be voting on in the special session. However, it is clear that there are 3 choices (and variations of these 3 choices) facing the legislature regarding rail funding: 1. No additional taxes and have rail be built until current funding runs out. HART claims that this is not an option because the federal government will want its $1.55 billion back. 2. Extend GE taxes forever (original request) or for 10 years until 2037. This is senate’s last position. 3. Increase TAT by 1% for 10 years and GE .5% for only 1 more year and gave back $10 million in TAT to the various counties with honolulu’s entire TAT share paying only for rail. This is the House’s last position. This was originally proposed late in the 2017 session because Mayor Caldwell testified that most of GE taxes were paid for by tourists (without data supporting his assertion); and it was to ensure that tourists did indeed pay for rail like he testified.

The tourist industry has recently spun the third alternative as a neighbor island tax on rail despite the fact that those who travel & stay with friends or family will not pay TAT tax at all; and completely ignoring the fact that a GE tax increase is also a tax on neighbor islanders who buy on-line from stores like Macy’s, Best buy, Sears, Target & Walmart. For the months of April &May 2017, amazon voluntarily collected Hawaii GE taxes too at 4.5% ( and stopped after it appeared that the US Supreme Court was not going to rule on internet sales but now there are 9 members of the US Supreme Court. See: one-step-closer-to-internet sales tax. Don’t let the tourist industry fool you, a GE tax increase affects everybody, especially neighbor islanders who depend on on-line purchases, and not just Oahu.

The various counties also do not like the TAT increase option because they want the option to collect the .5% GE for its own transportation needs.

To answer your questions:

1. Will you vote YES or NO on a 1% STATEWIDE increase to the Transient Accommodations Tax (9.25% to 10.25%) to help fund the Honolulu Rapid Transit System in the upcoming legislative special session?

It depends on whether the proposed bill gave back to the counties $10 million/year like the latest house position and decreased the GE increase from 10 years down to 1. As I stated earlier, a 10-year GE tax increase affects more neighbor island residents than a TAT increase especially where it is likely that the new 9-member US Supreme Court will rule to allow taxation of all on-line sales. I voted Yes on the house position in 2017.

2. Would you support a 6 year extension of the Honolulu General Excise Tax Surcharge of 0.5% from 2027 to 2034 if this will help fully fund the Honolulu Rapid Transit System without raising the Transient Accommodations Tax STATEWIDE?

YES – but this is unrealistic because the State Constitution requires that Hawaii County and all the other counties be given an option to increase their GE tax once we give Honolulu the extensionso it won’t be a Honolulu-only GE tax AND no one has ever testified that 6 years was sufficient. HART and all entities have testified that it is their request that the GE .5% increase extensions be forever because they don’t think it ever will be financially sustainable with just fares alone. HART’s track record of asking for a 10 year extension in 2015 and now another extension 2 years later has shown that they will keep coming back. In 2015, I voted NO on any GE tax increase specifically because I did not want to give Hawaii County an opportunity to raise GE at a time when we were just recovering from Iselle and the lava flow so if it was a statewide increase in GE taxes, like that in 2015, I would likely vote NO again because a GE tax is regressive.

3. Would you support an increase of the Honolulu General Excise Tax Surcharge of 0.5% to 0.62% and a 3 year extension of the Honolulu General Excise Tax Surcharge from 2028 to 2030 if this will fully fund the Honolulu Rapid Transit System without raising the Transient Accommodations Tax STATEWIDE?

Probably Yes but no one has given us this option and see my objections to any GE tax increase in my prior answers

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