Representative Mark Nakashima’s Response to Questions on Special Session on Honolulu Rapid Transit System

Representative Mark Nakashima

Dear Mr. Tucker:
Thank you for your recent email expressing your interest in the up-coming special session on the Issue of Honolulu’s rail system.  Please be assured that I share your concern.  As you know, the decision by the Hawaii Legislature was made before I joined the body, and I believe that questions regarding the state’s commitment to the program as well as other issues regarding the design have already been made.

The House of Representatives voted on the last day of the 2017 Regular Session on an amendment agreed to by with our Senate colleagues on an amendment that would have increased the Transient Accommodation Tax (TAT) by 1% for eleven years, extended the 0.5% General Excise Tax (GET) surcharge on Oahu for an additional year until 2028, restored $10 million to the county’s portion of the TAT allocation, and create a special fund for education.  Unfortunately, this agreement was not agreed to by the Senate as a whole and the bill died for lack of agreement.

One of the major rationales supported by the City and County of Honolulu for using the GET was the fact that approximately 30% of this cost was borne by visitors who paid the GET during their stay in the islands.  The TAT or hotel room tax is paid only by hotel guests while staying in a hotel room, and as such, the vast majority of this revenue would be paid by visitors with the exception of the local residents travelling inter-island and staying in a hotel.

Much has been said bout not wanting to pay for a project on another island, however I think many people miss the point that the City and County of Honolulu pays the vast majority of GET which then subsidizes the state hospitals and neighborhood schools – a system which work on a group of island where the vast differences in real property tax incomes would otherwise cause great inequities from island to island.

I regret that I will not participate in speculation on the final form of the bill to be considered the legislature until one has been written, as percentages and duration becomes meaningless until I am able to see the justification and rationale for these positions.

Finally, I will reiterate that only people who stay in hotel rooms pay the TAT.  Most residents will never pay this tax.  Everyone in Hawaii pays the GET.

Aloha and Best Wishes.

Sincerely,
Mark Nakashima
District 1


Aloha Rep. Nakashima,
Mahalo for representing the Big Island in legislative issues. I have some questions for you folks and hope you will respond to me by Wednesday, August 23rd, 2017
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?
If your answer is YES, please explain why? If your answer is NO, please explain why?
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 or NO
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?
YES or NO
Thank you for your participation in this quick and important decision that will affect all of us on this island.

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