Hawaii County now has an opportunity to add a half-cent local surcharge to the 4 percent state general excise tax, thanks to Gov. David Ige’s notice Monday that he will not veto a bill that includes the other counties along with Honolulu’s GET extension for its controversial rail project.
Other bills that survived Ige’s veto pen include the establishment of medical marijuana dispensaries, education, parental visitation and housing protections for medical marijuana users, increasing the low-income tax credit, providing insurance protection for autism patients and requiring performance evaluations and making it easier to fire the chief elections officer.
Ige listed eight bills he is considering vetoing. They include changing the definition of promoting prostitution to sex trafficking, allowing University of Hawaii graduate assistants to unionize, repealing the ethanol tax credit and clarifying the order of succession to the lieutenant governor’s office.
His possible veto of the sex trafficking bill would leave Hawaii as the only state in the nation that doesn’t have a law against sex trafficking. Ige said he’s concerned about unintended consequences and he hopes a better bill will pass next year.
Ige had until Monday to put out his list of potential vetoes. The inclusion on the potential veto list doesn’t necessarily mean they’ll be vetoed, but it puts proponents and opponents on notice about his concerns. He has until July 14 to sign, veto or allow the bills to go into law without his signature.
Ige said the medical marijuana dispensaries bill has a fast timeline and probably doesn’t have enough funding. He said a lot of the issues will be clarified in the rule-making process.
“We’re going to work really hard to make the six months,” Ige said.
The bill allows eight companies to open two marijuana dispensaries each as early as July 15, 2016. The state Department of Health will issue the licenses, allowing up to 3,000 plants at each of the 16 facilities.
Three dispensary licenses will be for the City and County of Honolulu, two each for Hawaii and Maui counties and one for Kauai.
Mayor Billy Kenoi and Council Chairman Dru Kanuha welcomed the news about the GET surcharge. While both said they’re not sure they’ll push for the tax increase, they said they’re glad the state Legislature and governor are giving the county a chance to decide for itself.
The county has to hold a public hearing and have an ordinance in place by July 1, 2016, or it loses its chance.
Kenoi said he won’t ask the County Council for the tax hike, but he’s ready to discuss it.
“It’s an important tool, it’s an additional tool to pay for important infrastructure,” Kenoi said. “It’s something we’ll take a look at. It’s not something we’re asking the council to do at this time.”
Kanuha said it’s an important discussion for the council to have. He said he’ll sponsor a bill, unless a council member “more passionate” about the issue beats him to it.
“I like the ability of the county to say whether it’s going to happen or not,” Kanuha said. “I think it’s important for us all to talk about it. … I’m just glad we have the opportunity to say whether it’s good or bad for our county.”
Unlike a sales tax, the GET is applied against all steps of a manufacturing process, leading to costs passed on to consumers beyond the 4 percent at the register. About one-third of it is paid by visitors.
The states’ four mayors had asked the state to allow the one-half cent to make up for cutbacks in the counties’ share of the Transient Accommodations Tax, paid by guests at hotels and part-time renters.
Email Nancy Cook Lauer at ncook-lauer@westhawaiitoday.com.