Hawaii lawmakers are weighing five options to provide funding to complete Honolulu’s over-budget rail line from Kapolei to Ala Moana, including a statewide increase in the general excise and hotel taxes, according to a state Senate presentation obtained by Civil Beat.
The Legislature plans to hold a special session later this month to try again to reach a deal on how to pay for the 20-mile, 21-station project, which is now estimated to cost $10 billion.
Key House and Senate committees have scheduled a joint public information briefing Monday morning at the Capitol. The new options to fund the project, along with the choices under consideration before the Legislature adjourned in May, are expected to play a central role in the negotiations.
The Legislature will hold a special session later this month to figure out how to pay for Honolulu’s over-budget and behind-schedule rail project.
Cory Lum/Civil Beat
The draft 52-page presentation, provided by a state senator Monday, lays the groundwork for a case to have Kauai, Maui and Hawaii counties help fund Honolulu’s beleaguered project. It notes that Oahu subsidizes harbors, airports and highways on the neighbor islands.
The presentation includes options to extend the 0.5 percent general excise tax surcharge for Oahu; increase the GET surcharge for Oahu; extend the GET surcharge for Oahu and increase the hotel tax for Oahu; or establish a statewide GET surcharge and hotel tax increase.
The Federal Transit Administration is kicking in $1.55 billion for the project. It could withhold some of those funds, particularly if the rail line has to stop short of its plan to go from Kapolei to Ala Moana Center. The project was expected to cost $5.2 billion just a few years ago.
House Speaker Scott Saiki has said the city’s latest figures project a nearly $1.4 billion shortfall from now to 2024.
The two chambers ended the session far apart. The Senate left with a bill to extend Oahu’s 0.5 percent general excise tax surcharge for 10 years, until 2037, to help complete the rail project.
That’s the option Honolulu Mayor Kirk Caldwell and the tourism industry supported.
The House pushed a bill that would have allowed the GET surcharge to be levied for just one additional year, to 2028, while increasing the state’s 9.25 percent transient accommodations tax for 10 years.
“In spite of our impasse during the 2017 legislative session, the Legislature understands the importance in crafting a legislative solution that will provide the City and County of Honolulu a dedicated revenue stream,” said Senate President Ron Kouchi in a press release announcing the public briefing.
The briefing starts at 10 a.m., Monday, in the Capitol auditorium. The special session is set to run from Aug. 28 to Sept. 1.
See the draft presentation, which a state senator said was created by the Senate Ways and Means Committee, below.
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