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Monday, March 21, 2011
March 21, 2011 News Read
By Andrew Walden @ 2:09 PM :: 6602 Views :: Hawaii County News, Agriculture, Kauai County News, DHHL, Honolulu County News, Democratic Party, Hawaii State Government, Republican Party

The plan to Overhaul Straight Hawaii

Hawaii 2011 Reapportionment Commission includes Jeff Stone's Wife, Hannemann Staffer married to Rail Contractor

Hanabusa, Hirono vote for Government Shutdown—Oppose Afghan Withdrawal

HECO: IBEW got raises, we got two-tier Pension Plan

Rep Fontaine interviews Bishop Silva, Darryl Vincent on Homelessness

Excuse: Senate Money Chairman: Hawaii House Budget 'No Longer Valid'

"Two weekends ago we went through the budget and thought we were in pretty good shape," David Ige, chairman of the Senate Ways and Means Committee, told Civil Beat. "The assumptions we made then are no longer valid. All the factors have changed dramatically because the deficit essentially will double by the time we finalize our budget compared to where the House was. At least that's the way we'll be approaching the budget. It certainly is a bigger challenge."

Ige is estimating the state's shortfall will increase by another $250 million — that's on top of the $250 million gap revealed recently when the Council on Revenues downgraded its revenue forecast for the current year, prompting Ige's reference to deficit doubling.

Ige said the council's lowered projection — to just 0.5 percent growth from 3 percent growth — is still too optimistic.

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Visitors still arriving from Japan

All of the arriving Japa­nese tourists interviewed yesterday said they had planned their trips months ago. None of them came from areas heavily affected by the quake or tsunami.

"I didn't even feel the earthquake," said Hase­gawa Shi­zuka, 30, of Osaka, who has no relatives in affected areas, either.

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Intent: Anything that is rented or shipped will pay GE Tax under House Scheme to extract $729M from Hawaii residents ($521 per person)

Some business activities that would lose the GET exemption:

>> Subcontractor deduction
>> Sublease deduction
>> Gross receipts from rental or leasing of aircraft or aircraft engines used for interstate transport
>> Amounts received for aircraft service and maintenance
>> Amounts received from loading or unloading ships and tugboat services

How the GET would be applied on those business activities:

>> 2% from Jan. 1, 2012, to Dec. 31, 2012
>> 3% from Jan. 1, 2013, to Dec. 31, 2013
>> 4% from Jan. 1, 2014, to June 30, 2015

How much the temporary tax would generate:

>> Fiscal year 2012: $55.7 million
>> Fiscal year 2013: $162.8 million
>> Fiscal year 2014: $234.7 million
>> Fiscal year 2015: $276.3 million

RELATED: Abercrombie, Legislators scheme to divert capital improvement money to General Fund

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Tax The Peasants: GE Tax to hit Shipping, Phone bill, Airline travel

KALAPA: Why would these "special interest" exemptions increase the cost of living in Hawaii? Well, one of the largest "special interest" exemptions is that extended to stevedoring activities. This exemption was adopted when a U.S. Supreme Court decision determined that the interstate commerce clause did not prohibit states from taxing those activities. Because nearly everything consumed in Hawaii comes over the docks, the imposition of the general excise tax at the 4% rate would have rippled through the economy causing the price of goods and services to rise. Thus, if the "special interest" exemption is suspended and taxed at the 2% rate, it would affect the price tax of everything from rice to a pair of shoes.

Another "special interest" exemption that would be suspended would be the leasing of aircraft and aircraft parts. Since any departure or arrival for residents or visitors is aboard aircraft, whether leased or owned, the cost of the general excise tax on the leasing of those aircraft or aircraft engines would affect the cost of that air travel. Thus all passengers - residents and visitors alike - would have to pay more to vacation or do business in Hawaii.

Another "special interest" exemption that would be suspended is that for providers of telecommunications where one provider acts or provides service for another telecommunications provider. Otherwise known as "roaming" charges, these costs are reimbursed back and forth among providers and largely are no longer charged to individual customers as in many cases those charges create a "wash" between providers. Thus, the cost of the tax will be passed on to customers.

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SA: Approve city gas tax increase

It is classified as a tax, but the cost added by the city to gasoline at the pump is a fee that reflects Mayor Peter Carlisle's policy that people should pay for the cost of maintaining city resources that they use, in this case city roads…. (And if we call this tax a user fee, you will learn to love it.)

Adding fees by one or a few cents a gallon of gasoline to maintain roads is an unpleasant option. But to maintain our roads in the most cost-efficient way possible, it's the best option for now.

(Does this mean that the legislature will stop raiding the Highway fund? Just asking…)

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SB367: Committees to discuss $1B undersea Cable Scam Today (Give our money to billionaire wind-scammers)

Two House committees are scheduled to hear Senate Bill 367, which sets up a regulatory structure for the installation and implementation of an interisland, high-voltage, electric-transmission cable system.

DBEDT, DCCA and Hawaiian Electric have testified in support, but OHA has expressed concern because of how the cable system would affect Native Hawaiians on Lanai and Molokai.

Other testimony has come from individuals who worry the cable system will negatively impact state taxpayers.

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Number of bills alive in Legislature shrinks

The Hawaii Legislature has narrowed the number of bills it's considering from 3,224 to more than 600.

More than 325 bills originating in the Senate passed, and 343 bills originating in the House advanced before last week's crossover deadline.

The Legislature has completed 33 of its 60 annual business days.

Bills must pass their second chamber by April 14 in order to survive, and then many of them will go to House-Senate conference committees if the legislative bodies disagree on their versions of the bills.

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HPD Officer Salaries: A Tale of Confusion and Contradiction

The department has argued that it's unclear which officers should be covered by the exemption for current and former undercover employees. It first tried to claim that officers who could work undercover in the future should be exempted, but the Office of Information Practices shot that idea down. Then the department asked the Legislature to clarify which officers should be covered. (Those efforts have failed.)

While it still hasn't complied with Civil Beat's initial request, the department went ahead and on February 9 made public the names of the very officers it had said could never be released, because they are definitely undercover — members of a crime reduction unit.

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Chairman of ERS Board Responds to George Berish Series on Public Pensions

Civil Beat’s columnist George Berish is entitled to his opinion but he should not mislead your readers regarding the facts, particularly when he does so to support his personal attacks on the trustees and staff of the Hawaii Employees Retirement System (“ERS”).

Berish accuses me of being “imprudent” as an ERS trustee because he claims to have only heard me speak out about the ERS’ unfunded liability after reading my op-ed in the Honolulu Star Advertiser earlier this year. He knows that is not true. I was appointed to the Board of Trustees in 2001. One year later my fellow ERS trustees and I filed a lawsuit against the State of Hawaii and the Counties (the “Public Employers”) to force them to stop “skimming” investment earnings by “shorting” their required annual contributions to the ERS. See, Kahoohanohano v. State of Hawaii, 116 Haw. 1; 162 P.3d 696 (2007). If filing a lawsuit against the Public Employers isn’t “speaking out” loud enough, I’m not sure what would get Berish’s attention.

Moreover, since 2002, the ERS trustees have annually raised the red flag regarding the growing unfunded liability in our annual financial reports which were published and accessible online. For example

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Businessman offers plastic bag alternative

The Kaua‘i County Council’s Public Safety and Environmental Services Committee on Wednesday deferred its decision on legislation that would let ready-to-eat food establishments offer biodegradable bags. The amendment defines “biodegradable bags” as those made of a degradable plastic in which the degradation is caused by naturally occurring microorganisms.

“Let the new science come in,” said David Hong, president of O‘ahu-based Island Plastic Bags.

Hong said aliphatic bags, a new product in the market, are biodegradable and biocompostable. He added that they are also much thinner than other known certified compostable film products, costing less to transport and leaving a lower carbon footprint than other compostable bags.

But the bags are made out of carbon dioxide captured from the waste stream at wells of natural gas, a fossil fuel. Ordinance 885 prohibits bags manufactured with polymers from fossil fuels to be offered at check-out points in retail stores, including ready-to-eat food establishments.

Hong said if the council eliminated the term “polymers from fossil fuel” from the ordinance, the bags would be allowed and some of the problems would be solved.

“We’re blocking science,” Hong said. “This aliphatic bag was not here six months ago.”

LINK: Aliphatic Bags

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Tipping Fees: Should Private Scrap Yard Get $1.9 Million Subsidy from Honolulu?

Schnitzer Steel's Oahu scrap yard gets a $1.9 million subsidy every year for recycling metal and keeping it out of the city landfill. The Portland-based global corporation gets the lion's share of a city benefit for recycling companies.

Now, with the council eyeing cutting the subsidy in the face of a tough budget climate, Schnitzer is fighting back with the help of John Radcliffe, one of the state's best known lobbyists, and Communications Pacific, one of its most prominent public relations firms. Pushing for the bill are two former council candidates, Matthew LoPresti and Bob McDermott, and Keith Rollman, who was a top aide to former Honolulu Mayor Mufi Hannemann.

Those who oppose the subsidy call it corporate welfare, and say it helps Schnitzer monopolize the local recycling industry. Schnitzer and some other local recycling companies say the discount helps stabilize a volatile steel market and incentivizes recycling in Hawaii.

The subsidy was created in the mid-'90s as a way to encourage recycling. But Honolulu Environmental Services director Tim Steinberger says it's time to consider passing Bill 47 to end it.

(Just wait ‘til the price of steel drops.  The recyclers will close up shop and Oahu will be covered with junk cars.)

SA: Compost facility pitched for parcel in Wahiawa

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Hawaii burns $2.35M on “Open Space”

The parcel was under private ownership and slated for residential development (kudos to the owner for employing this negotiating tactic!) until the Trust for Public Land, a national nonprofit based in San Francisco, negotiated a deal to purchase it.

Half of the money was provided through a competitive federal grant program run by the National Oceanic Atmospheric Administration's Coastal Estuarine Land Conservation Program. The other half was furnished by the state's 6-year-old Land Conservation Fund.

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AT&T to buy T-Mobile USA for $39 billion

For T-Mobile USA's 33.7 million subscribers, the news doesn't immediately change anything. Because of the long regulatory process, AT&T expects the acquisition to take a year to close. But when and if it closes, T-Mobile USA customers would get access to AT&T's phone line-up, including the iPhone.

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Four Hawaii Borders bookstores will close

The company filed for reorganization relief under chapter 11. The Kahului, Kailua-Kona, Lihue and Waikele locations are just some of the 200 plus stores that are on the chopping block.

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Hawaii Small Businesses Absorbing Soaring Gas Costs

Matson Navigation is increasing shipping costs for the second time in two months at the end of March and consumers will see the results of that hike in the price of goods shipped to the islands.

But some small businesses said they'd rather see their profits shrink than lose loyal customers.

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