The County Council is likely to stomp on the brakes on a resolution cutting the county gas tax 10 cents a gallon to help alleviate drivers’ pain at the pump.
The council Finance Committee on Tuesday voted 3-5 to send Resolution 363 to the County Council with a positive recommendation, meaning the measure will still proceed to a public hearing April 19 before being heard by the council April 20.
Unless the public hearing or some other new information changes minds, the council has signaled it will reject the idea, and the public is unlikely to see any relief at the pump.
Puna Councilman Matt Kanealii-Kleinfelder, the sponsor of the resolution, noted the county has a $20 million unspent balance in its highway fund, a fund that averages a $5 million to $8 million balance annually. In addition, he said, property tax revenues this year are “off the charts” due to a hot real estate market. The county can afford it, he said.
“I don’t think we’re at a shortage this year. … If this went more than a year, then we could have problems but this isn’t intended to go more than a year,” Kanealii-Kleinfelder said. “Our residents are looking for relief. It’s just that simple.”
Property values have increased by about 13%, adding $45.4 million to the record high $689.9 million proposed budget Mayor Mitch Roth unveiled last month.
Also voting in favor of the resolution were Kona Councilwoman Rebecca Villegas and North Kona Councilman Holeka Inaba, who said they wanted to do some additional research and also review how to ensure there’s a sunset date in the measure.
“It’s not a long-term tax holiday; it’s stop-gap to give us some relief,” Villegas said, noting that other municipalities are passing measures like this one. “I see wisdom in passing this forward today and taking it to the community and let our people decide.”
Villegas said gas topped $6 a gallon at one Kailua-Koa station she passed Tuesday.
Finance Director Deanna Sako said the proposal would take about $7.5 million annually from county coffers, impacting operations for highway maintenance and police traffic services, while saving drivers about $1 or $2 per fill-up.
Puna Councilwoman Ashley Kierkiewicz characterized the measure as providing “short-term relief but long-term grief,” while Hamakua Councilwoman Heather Kimball said the effect on motorists’ gas savings was “manini,” compared to the effect on the budget.
Other council members, opposing the measure, pointed to the sorry condition of the county’s thousand miles of roadway and worried the county could lose fedral or state grants if it didn’t have matching funds ready.
“We may save some money up front but my concern is we miss out on the back end of millions of dollars of support because we don’t have the match,” said Kohala councilman Tim Richards, who acknowledged he had voted against the series of gas tax hikes the county approved in 2017. “It’s not just our county roads, but our state roads are buss’ up too.”
The gas tax was 8.8 cents a gallon until 2017, when the County Council voted to raise it incrementally to its current 23 cents, the highest rate in the state for a county with by far the most miles of roadway. The county tax is in addition to 18 cents per gallon in federal tax and 16 cents in state tax.
In addition, said Hilo Councilwoman Sue Lee Loy, the driver could end up paying more anyway in repairs.
“We’re saving a few dollars at the pump but if our roads are bad its going to cost more to fix our shocks and struts,” Lee Loy said. “Are we truly providing the relief or is this just a feel-good shot in the arm?”
