Monday, September 2, 2024
More
    Home Blog Page 22

    The 2023 Intent to Veto List

    Tom Yamachika
    -
    0
    The 2023 Intent to Veto List

    On June 23, Gov. Green issued his intent to veto list.  Any bill that is now pending before him and not on the list will become law.  Any bill that is on the list may or not be vetoed; the Governor has until July 11 to make a final decision.

    None of the tax bills we have been following are on the list.  But some very interesting bills are.

    There’s House Bill 999.  We mentioned that bill when we covered the State’s “shadow budget” last month because the budget included some $50 million for a first responders’ training facility in central Oahu that HPD and the House didn’t like, but the Senate slipped the millions in anyway.  And, for good measure, the conference committee on that bill overhauled it to effectively kick one person, who happened to be critical of the first responders’ park, off the board of the High Technology Development Corporation that was tasked with building said park.  The Governor wasn’t having any of this, however.  This bill made the list because the proposed modifications to the Board were “too substantial.”  And by the way, the Governor also gave notice of intent to line-item veto the $50 million appropriation.  Bully for him!  Revenge and retribution don’t properly have a place in moving our State forward.

    Then there is Senate Bill 1518.  It gives the Department of Education several procurement exemptions.  Why?  According to the bill’s preamble, the DOE is a big honkin’ department and doesn’t have time to be bogged down with such silly things as procurement laws.  And, by the way, it says that the State’s electronic procurement system is “complicated and onerous,” placing a heavy burden on school administrators who need to comply with the law.  The Governor’s answer?  We have a system of procurement laws that is supposed to give us an open and transparent process.  Carving out exceptions to it would decrease efficiency, create administrative burdens, limit competition, and open unfair advantages to certain vendors.  In my book, I chalk up one point for the Governor and zero for cronyism. 

    Another interesting one is House Bill 475.  That one would create a pilot program for monetizing art.  The State, through a set-aside program administered by the State Foundation on Culture and the Arts, has a lot of very significant artwork.  So, the bill proposes to loan out the art to private individuals, businesses, or entities – for “reasonable financial consideration.”  That way, we make the art available for a lot more people to enjoy, and the State gets some money for it.  Win-win situation, right?  The Governor doesn’t think so.  His veto rationale is that property bought with taxpayer money should be used for a public purpose, and the pilot program looks more like money-grubbing, which could get the State into all kinds of trouble such as compromising the State’s tax-exempt bond program, increasing debt service costs and tarnishing the State’s financial reputation.  If there are technical, federal tax, and constitutional concerns about the bill, however, why didn’t someone from the Attorney General’s office make them known in testimony?  This bill’s history makes me worried that someone has been sandbagging.

    And last but not least, there is Senate Bill 945, relating to special purpose digital currency licensure.  It would have Hawaii start to regulate cryptocurrency.  The 80+ page bill contains a lot of words but no money for DCCA to turn those words into action, as the Governor’.  Clearly, if Hawaii wants to play in this space it needs to put some money where its mouth is.

    The Governor’s intent to veto list is here, where you can see descriptions of some of the other bills that made the list – eleven on this list plus the State budget bill for which the Governor has proposed line-item vetoes.

    Economic Misfortune Can Fix Our “Shadow Budget”

    Tom Yamachika
    -
    0
    Economic Misfortune Can Fix Our “Shadow Budget”

    In recent weeks, we have been reporting on Hawaii’s “shadow budget.”  We found out that a first responders’ campus in central Oahu, even when a bill to create it was stomped on, shaken violently, and killed in the House, could still be funded via the State’s budget bill due to some behind-the-scenes machinations involving the powerful chair of the Senate Ways & Means Committee.

    That, however, may change because of some misfortune.

    In the most recent meeting of the State’s Council on Revenues, economists came back with a more dire forecast for Hawaii‘s economy, lopping a cool billion dollars off the State’s forecasted revenues. 

    In response, Governor Green just did something very unusual.  He met with legislative leaders, including the senator we mentioned above, and told him that he intends to line item veto parts of the budget bill in order to accommodate the billion dollars that we’re not going to get.  Our Constitution, after all, requires that our budget be balanced.  This was unusual because the Governor still has quite a bit of time before the deadline to notify legislators of bills he plans to veto.  And even if he didn’t line item veto the budget, he certainly has the authority to withhold funding for items in the budget given that some of the income on which the budget was based is not going to materialize.

    So our Governor had a weekend meeting with this powerful senator and said, “Look, we need to invest in established state priorities, such as housing, homelessness, health care, and the environment, and here you have a $50 million project for first responders but our Honolulu Police Department, who ideally should be one of the prime users of this project, has said they don’t like it and won’t participate in it.  So, that project is going to be line item vetoed.  But we’ll find other ways to modernize the State’s emergency response facilities.”

    The good Senator issued a statement recently saying that he understood where the Governor is coming from.  Perhaps that means he is plotting revenge later but realizes he can’t do anything now.  Could the Legislature override the veto of the budget bill?  That would be extremely tough given that the Senate would need the House to vote to override as well.  Further, even if the override did occur, the budget would then be out of balance, and the Governor could restrict funding for certain items at his discretion to make the budget balance.  Thus, funding for the first responders’ center still would not happen.

    In the meantime, the Governor is also taking sensible steps such as line item vetoing $500 million out of the $1 billion that the budget bill would add to our rainy day fund.  Adding $1 billion to the fund, which sits in a bank somewhere waiting for an emergency to happen, would be questionable even if we had the spare cash given that we have current uses and needs for that money.  Now, with the downbeat economic forecast, it’s questionable whether we even have the cash to spare.

    Other significant proposed reductions include funding for teacher housing, reduced from $170 million to $50 million; boating and ocean recreation, with $60 million eliminated; water and irrigation infrastructure, from $94 million to $5 million; Iwilei/Kapalama transit oriented development infrastructure design and construction, from $86 million to $25 million; and Hawaii Green Infrastructure Authority solar energy storage loan program, from $100 million to $50 million.

    Sometimes it takes a bad situation to make another bad situation better.  This might be one of those times.

    New licensure law major step toward better healthcare access in Hawaii

    Grassroot Institute
    -
    0
    New licensure law major step toward better healthcare access in Hawaii

    By Keli’i Akina

    State lawmakers handed Hawaii residents a great victory this week in the effort to improve healthcare access in Hawaii.

    Gov. Josh Green signed a series of healthcare-related bills on Wednesday — and one of those was SB674, which allows Hawaii to enter the Interstate Medical Licensure Compact.

    Joining the compact will make it easier for doctors from the 37 other member states to obtain a license to practice in Hawaii, which will help ease Hawaii’s longstanding doctor shortage.

    Keli’i Akina

    The latest estimate is that Hawaii is short nearly 800 “full-time equivalent” doctors. Primary care physicians are most in demand, but the lack of certain medical specialists is so severe that patients from some areas in the state are forced to fly to Honolulu — or even the mainland — to receive the healthcare they need.

    In other words, we have long needed a series of reforms targeted at improving healthcare access in Hawaii — and now that’s starting to happen. I commend the Legislature for passing SB674, and Gov. Green for signing it.

    The Grassroot Institute of Hawaii actually had a big hand in getting SB674 across the legislative finish line. At the beginning of the year, we published a policy brief titled “How changing Hawaii’s licensing laws could improve healthcare access” that discussed the ways in which licensing restrictions contribute to our shortage of medical professionals and lack of access to healthcare in general.

    One solution proposed in the report is that Hawaii should join one or more of the interstate licensure compacts that allow doctors, nurses and other medical professionals to more easily practice across state lines.

    That line of reasoning struck a chord with Hawaii lawmakers, and two of them — Health Committee Chairs Della Au Belatti in the House and Joy San Buenaventura in the Senate — introduced bills based on model legislation proposed by the Grassroot Institute.

    Both chambers supported SB674 almost unanimously on its way to the governor’s desk, and now that Gov. Green has signed it, physicians from around the country will enjoy an expedited path to licensure in our state.

    Of course, simply joining the IMLC won’t solve Hawaii’s physician shortage by itself. But it could start a wonderful trend of removing the regulatory barriers that make it unreasonably difficult for other healthcare providers to practice in our state as well.

    So what should our next steps be?

    I suggest that Hawaii lawmakers explore having the state join other interstate compacts for medical professionals, such as the Nurse Licensure Compact, the Physical Therapy Licensure Compact, the Psychology Interjurisdictional Compact, the EMS Compact and the Advanced Practice Registered Nurse Compact.

    At a minimum, Hawaii could create its own license recognition process or establish an expedited path to state licensure for medical professionals who hold valid licenses from states.

    Lawmakers also should exempt medical services from the state general excise tax. As my Grassroot Institute colleague Malia Hill explained in another policy brief we issued early this year, Hawaii is one of only two states that tax medical services and the only state to tax services for TRICARE and Medicare beneficiaries.

    Hawaii doctors have been saying for years that the GET — which is often not passed on to the patient — is a substantial overhead cost that makes it more difficult and expensive to practice.

    Finally, our lawmakers should take a hard look at the regulations that prevent growth and expansion of healthcare facilities in our state.

    It might be hard to believe, but Hawaii’s “certificate of need” laws require state approval for everything from new hospitals to the purchase of medical equipment or construction of new rehab centers.

    While many states are now repealing their CON laws — in response to research showing that they limit healthcare access and drive up costs — Hawaii continues to enforce some of the strictest “need” laws in the nation. Clearly, there is more we can do to make healthcare in Hawaii more plentiful, responsive and affordable.

    But for now, let us rejoice that Hawaii has taken an important step in the journey to a better healthcare system by joining the Interstate Medical Licensure Compact. I look forward to our lawmakers removing more of the barriers that limit healthcare access for Hawaii residents.
    _____________

    Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.

    A Dirty Problem

    Tom Yamachika
    -
    0
    A Dirty Problem

    We’ve long had a dirty problem here in Hawaii.  A number of homes here are not serviced by a sewer system.  Instead, waste goes into a cesspool in the ground, and every so often the homeowner calls up a friendly neighborhood pumping service to pump it out and get rid of the contents.

    This, of course, is not the healthiest state of affairs.  According to one Civil Beat essayist, we have “some 88,000 cesspools across the state that discharge 53 million gallons of untreated sewage into our groundwaters each day. This sewage pollution poses harmful threats to public health, drinking water, the near-shore environment and coral reefs, along with Hawaii’s reputation as a world-class destination.”

    So, in 2017, our lawmakers enacted Act 125, which says that every cesspool in the State, except for those exempted by the Health Department, needs to be converted to an approved wastewater system or connected to a sewer system by January 1, 2050.

    Now, then, how do we motivate the people who use cesspools to do the conversion?  Conversions like this aren’t cheap.

    In 2015, lawmakers passed Act 120, which provided for a tax credit of up to $10,000 per cesspool converted.  That credit was available for calendar years 2016 through 2020, and then sunset.

    In 2022, lawmakers tried a different approach in Act 153.  Instead of providing for  a tax credit, they gave a few million dollars to the Department of Health for a grant program.  People who intended to do a cesspool conversion could apply for the money up front, and then would receive reimbursement funds once the conversion took place and proper documentation was submitted.

    In both cases, homeowners had to front the cash to pay the folks who would be designing and building the conversion.  How did the two programs compare?

    KITV reported that from 2016 to 2020, there were only 200 homeowners who took advantage of the tax credits.

    And what about the grant program?  “We received over 200 applications in the first three days of opening of the grant program. The response is way better than the income tax credit program,” Sina Pruder, Dept. of Health Environmental Health Branch Manager, is quoted as saying.

    So, let’s get this straight, five years’ worth of tax credit applications produced the same number as the first three days of the grant program.

    Here at the Tax Foundation, we have been trying for several years to convince lawmakers that subsidy or grant programs are much better than tax credit programs.  For tax credit programs, we have been saying, lawmakers have to write up criteria and then have to pay anyone who meets the criteria, after the fact, even if the criteria didn’t accurately specify what lawmakers had in mind.  It’s like the five blind monks trying to describe an elephant.  Lawmakers probably don’t have problems with cesspools themselves but need to write the criteria for a good cesspool conversion.  Thus, with tax credits lawmakers probably don’t know what they are spending, because they haven’t much of an idea of how many applicants will come in, and they don’t know what they are buying for that money.  With a subsidy or grant program, the amount of the program is usually set – this one was $5 million – and the government folks can decide what they are buying when they approve grant applications.  Thus, they know what they are spending and what is being bought.

    Now we see that consumer uptake heavily favors the latter.  There may be several reasons behind that, such as that the consumer isn’t simultaneously struggling with a complex and arcane tax form at the same time.  The consumer can put more time and thought into the real problem, namely getting rid of the cesspool.

    Now maybe we can clean up some of our other tax credits.

    Governor shows courage trimming state budget

    Grassroot Institute
    -
    0
    Governor shows courage trimming state budget

    By Keli’i Akina

    My colleagues and I at the Grassroot Institute of Hawaii are not shy about challenging the actions of public officials. It’s part of our mission to promote a freer, more prosperous Hawaii.

    But we also want to celebrate wins and give credit where credit is due — which is why I would like to praise Gov. Josh Green for his recent courageous and wise budget cuts.

    Keli’i Akina

    Already faced with a budget-busting appropriations bill that threatened to deplete the state’s projected surplus, the governor then had to contend with bad news from the state Council of Revenues.

    The Council’s general fund projection for fiscal 2023 featured a 2% increase as recently as March. In mid-May, however, that projection was downgraded to a 1% decline.

    This news prompted Gov. Green to announce this week that he planned to trim approximately $1 billion from the Legislature’s proposed biennial budget via 22 separate line item vetoes, the most substantial of which include cutting:

    >> $500 million from the state’s Emergency Budget Reserve Fund for fiscal 2025 but allowing $500 million to be paid into the fund in fiscal 2024.

    >> $120 million for planned teacher housing, leaving $50 million to continue the project.

    >> $88.8 million from an irrigation infrastructure project, leaving $5 million.

    >> $42 million for Kalaeloa electric upgrades, leaving $5 million.

    >> $25 million for state parks renovations and improvements.

    These and other cuts are likely to draw criticism, but in fact, the budget passed by the Legislature was so excessive that we’re still $1 billion over the state’s constitutionally mandated spending cap.

    Ironically, some of the complaints about the governor’s budget cuts are for allocations that remain higher than the previous year. For example: Even after the cuts, the state Department of Education’s general fund budget will be 8% more than in fiscal 2023.

    The governor catching heat for reducing a budget item that still amounts to an increase provides some insight into the political courage it took to make such decisions.

    For those of us who support fiscal responsibility, it serves as a glimpse into the difficult balance the governor has to strike between protecting the financial future of the state and working with the different factions involved in budget decisions. It can’t be easy navigating between the principles of sound budgeting and political reality.

    Gov. Green also had to work with what he was given: an appropriations bill with record-high spending that landed on his desk at the same time that the state’s financial outlook began to dim. The fact that he did the right thing and cut spending — as difficult as it was — deserves recognition.

    It is encouraging to see that the governor is willing to listen to all sides and make tough decisions. That’s the spirit of “E hana kākou” in action.

    And if Gov. Green is in need of any more ideas about how to reduce state spending or improve Hawaii’s economy for the benefit of all, we at the Grassroot Institute remain eager to help.
    _____________

    Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.

    Hawaii voters the ultimate weapon against political corruption

    Grassroot Institute
    -
    0
    Hawaii voters the ultimate weapon against political corruption

    By Keli’i Akina

    Legal reforms can go a long way. But when it comes to putting a stop to longstanding corruption in Hawaii, the biggest impact of all will have to come from Hawaii’s voters.

    That’s my most important takeaway from the conversation I had with Judge Dan Foley during this week’s episode of my “Hawaii Together” program on ThinkTech Hawaii.

    Keli’i Akina

    Foley is a notable figure in Hawaii jurisprudence, having been both a civil rights lawyer and a member of the Hawaii Intermediate Court of Appeals. It’s no wonder he was tapped by House Speaker Scott Saiki to head the Commission to Improve Standards of Conduct — the state’s effort to root out corruption after a series of scandals heavily damaged the public’s trust in local government across the isles.

    The Commission was charged with looking primarily at government ethics, lobbying and campaign spending. Its 396-page report resulted in 28 legislative recommendations, 20 of which were approved by the Legislature this year.

    “That’s a remarkable success,” Foley told me.

    He said there are “at least eight measures, significant measures, that didn’t pass, but this is the first regular session, and there’s another one coming up. … We’re at halftime. … We had a good first half — 20 of 28 ain’t bad.”

    Foley said he was disappointed that a bill to prevent lawmakers from soliciting and accepting funds during legislative sessions didn’t pass. Also disheartening, he said, was the failure of a bill that would have capped fees for open records requests.

    “Right now,” he said, “access to public records depends on how much money you have. People with money can buy their way in, people without money cannot.”

    Foley said Hawaii’s short legislative sessions and questionable conference committee practices also frustrate transparency. He singled out this year’s last-minute approval of the state budget as an example, calling it “the poster child on how not to do things, and that should not be repeated.

    Instead, he said: “You can extend a session. You can come up with your draft budget earlier and not wait until the last minute. People should not be voting on measures they haven’t read. Things shouldn’t be added to a measure — I don’t even know if that’s legal — after it’s voted upon.”

    In general, Foley sounded optimistic that the many measures passed this year will help improve ethics in Hawaii government. But, he added, there will always be elected officials, lobbyists and businesses who will try to push the limits of what is legal, so the real key to rooting out corruption is Hawaii’s voters.

    “Ultimately, it comes down to the voter,” he said. “People complain about the Legislature. They’ll say the presiding officer is a dictator, or the chair of the Ways and Means or Finance committees is a dictator. [But] everybody in the Legislature has one vote. If people are unsatisfied with the presiding officers, it’s because the majority of that body allows it. Same with the chair, or same with measures. And the voters put them in and keep them in every two years.”

    He continued: “A lot of people will say, ‘Oh, this Commission report won’t mean anything. Whatever the Legislature will do will mean nothing.’ But that plays into the cynicism of the voter, the disillusionment. So my whole message is: Let’s get engaged, as bad as it is. … Just because [our government has] been, let’s say, a little less than honest and transparent in the past, doesn’t mean it can’t be honest and transparent in the future.”

    Foley noted that Hawaii has one of the lowest voter turnouts in the country. Could that be why some of our government officials have felt empowered to not do what’s pono — because they think they won’t be held accountable?

    I think that might be part of the problem, so it is our kuleana to put leaders in office who will do right by us, not themselves. Let’s vote. Let’s stay in touch with our representatives at all levels of government to let them know that we care and are paying attention.

    As Foley said: “You roll up your sleeves, you get to work, you be positive, you don’t give up, and you can accomplish a lot of things.”

    With that kind of an attitude, we can make Hawaii a state where sunshine abounds — not just on the beach, but in all our political affairs as well. Our future depends on it.

    _____________

    Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.

    Fevella’s Film Feud

    Tom Yamachika
    -
    0
    Fevella’s Film Feud

    On Wednesday, May 31st, there was a press conference held at the State Capitol regarding the Hawaii movie and TV production tax credit.  Two of the main speakers were Kevin Holu of Hawaii Teamsters Local 996 and Senator Kurt Fevella (R, District 20).  Hawaii News Now shared footage of the event.

    Mr. Holu complained that there were not enough local Teamster members working on the productions.  Earlier in the session, the Teamsters, testifying in favor of House Bill 1373, urged lawmakers to amend existing legislation by:  “Adding in safeguards to ensure that productions are engaging with local unions and hiring Hawaii residents and utilizing Hawaii-base businesses for goods and services.”  (The Senate Ways & Means Committee, which Senator Fevella happens to sit on, did just that, as we reported on about two months ago.)

    Senator Fevella launched into a tirade about how the State is now administering the credit.  “This is Hawaii,” he said. “People are standing in line to film here but when you have one person making the decisions – that’s the discouragement, that’s the guy’s discouraging people to come here.”  (Apparently he filed a personnel complaint against the head of the Hawaii Film Office, Donne Dawson, to emphasize this point.) 

    We wonder if the good Senator has been misinformed.  Do you remember Jason Momoa, the Hawaii-born actor who has made it one of his life’s projects to film a Hawaiian historical drama, “Chief of War”?  That series is indeed being shot now – in New Zealand.  Sure, part of the film was shot in Hawaii – on all of the major Hawaiian islands, according to the Hawaii Tribune-Herald, but, as it turns out, a good part of the movie is shot in New Zealand and a number of the principal cast members are New Zealanders, not Hawaiians.  It turns out that New Zealand offers international productions a production grant of up to 25% on qualifying New Zealand production expenditures.  Then, economics drove the location decision – “To survive, we had to go to Aotearoa [New Zealand] to survive for this, but by keeping the tax credit, it would give us the opportunity to keep us guys at home,” Brian Keaulana, “Chief of War” producer, was quoted as saying.  Perhaps the good Senator thinks that we could have or should have tried to force the production to do all of their shooting here.

    Back to our good Senator’s speech.  Continuing his tirade, he had some choice words for mainland companies managing studios and productions in Hawaii.  “You’re darn right I have a problem [with them],” he said.  “Everything should be local. It’s our land, it’s our place, it’s our people.”

    But we aren’t a country unto ourselves.  We’re part of the United States, as all Senators should know because they are required by Article XVI, section 4 of the Hawaii Constitution to take an oath to support and defend both the Constitution of Hawaii and the Constitution of the United States.  And the U.S. Constitution contains the Commerce Clause, which has been interpreted to mean that no single State has the right to turn away or discriminate against commerce from other States.  We’re all supposed to be one big happy family of States in this country.  Granting a small tax credit for out-of-state production payroll and a bigger one for in-state payroll, as was proposed this session, is one way of blatantly discriminating against other States, which state governments simply can’t do.  There are several other examples of such discrimination in the latest version of House Bill 1373, which died in this past session and, hopefully, will stay dead.

    We are not sure that the Fevella Feud is now over.  We’ll know more in the coming weeks.  Until then, we hope that all parties can be better informed.

    Hawaii’s Shadow Budget

    Tom Yamachika
    -
    0
    Hawaii’s Shadow Budget

    Recently there has been criticism heaped on the Supreme Court of the United Sates for making very important rulings via a “shadow docket” consisting of motions for various kinds of emergency relief.  Those rulings are typically made on the papers alone, without the benefit of oral argument, and normally do not contain discussion of the precedents or the reasoning in the “normal” opinions of the Court.

    Here in Hawaii, we have a shadow budget, not a shadow docket.

    First, this year’s budget includes $200 million that the Governor can spend at his discretion.  The big issue with the $200 million isn’t the basic concept – governors have been given discretionary funds before – but the way that line made its way into the budget bill.  Specifically, it wasn’t in the budget bill when the House-Senate conference committee voted to approve it.  The conference committee did vote to pass the budget bill “with amendments,” however, and the $200 million was then added to the bill before both houses held final votes on it a few days later, as House Finance Chair Kyle Yamashita acknowledged.  That left a bad taste in the mouth of some of the House members, especially, who vented their displeasure on the House floor and voted against the bill. 

    Next, $50 million was included in the budget for a first responders’ training facility near Mililani.  It was included in an appropriation for the High Technology Development Corporation.  Earlier in the session, however, lawmakers had considered a first responders technology campus.  Rep. Amy Perruso, chair of the House Higher Education and Technology Committee, held hearings on the bill and found out that Honolulu Police Department had no intention to use the facility.  “We currently have the facilities … this bill proposes to create,” HPD testified.  Rep. Perruso’s committee killed the bill.  But some senators refused to take no for an answer, and through a “legislative adjustment” process added the appropriation to the budget bill anyway.  And there was retribution for a key dissenter.  The legislature passed a bill changing the legal requirements for membership on the board, which would have the effect of booting Vassilis Syrmos, one of the members of the HTDC’s board of directors critical of the first responders’ park.  (The language kicking out Mr. Symos wasn’t in that bill, HB 999, until the conference draft.)

    And then, how about our public school teachers?  In HB 1004, lawmakers funded $187 million in the upcoming biennium to fund negotiated raises for unionized teachers.  But the budget bill taketh away what that bill giveth:  the budget bill contains a $167 million reduction of the Department of Education’s budget.  Rep. Jeanne Kapela complained that the budget “continues the historic underfunding of our public education system.”

    And finally, the budget process had many similarities to “ready, fire, aim.”  As former Senator Russell Ruderman pointed out in a Civil Beat article, the Legislature’s vote to approve the budget bill was held on May 1.  The session ended May 4.  The final worksheets for the budget were released on May 15.  “The budget bill was not finished by the deadline,” Ruderman says, “and the ’leadership’ insisted that members vote on it anyway, even though many important expenditures were still blank. That is, they voted on a budget bill that they had not read, because it wasn’t written yet!”

    Supreme Court, you have your shadow docket; we have our shadow budget.  Which is more mysterious and arcane?  More importantly, what’s wrong with this picture?

    ‘Empty homes’ another distraction from constructive housing policy

    Grassroot Institute
    -
    0
    ‘Empty homes’ another distraction from constructive housing policy

    By Keli’i Akina

    At its core, the high cost of homes in Hawaii is a supply problem. We simply don’t have enough homes to keep up with demand, which drives up the prices of existing homes.

    The bottom line is there is no other solution than to build more homes. 

    To do that, we need to remove the barriers to homebuilding — such as the multiple bureaucratic permissions that homebuilders must obtain and the many land-use and zoning restrictions that limit where and what kinds of homes can be built.

    Keli’i Akina

    Unfortunately, many people would rather look for scapegoats than address the real cause of the problem. One is “outsiders” — people from the mainland or anywhere else in the world who want to buy property in Hawaii.

    The Grassroot Institute of Hawaii produced a report last August that found no meaningful relationship between outsiders and housing prices in Hawaii — or anywhere else, for that matter. But that didn’t end the search for scapegoats. 

    The newest talk of the town is so-called empty homes — homes that are vacant for some arbitrarily determined amount of time — which some lawmakers would like to see taxed in an effort to alleviate Hawaii’s housing crisis.

    The main idea is that a punitive tax would induce owners of “empty” homes to either rent or sell their homes to people who would be full-time occupants. Other goals include generating tax revenues, increasing housing supply and lowering home prices.

    Now, sure, an empty homes tax could generate some tax revenues or have a minor effect on reducing vacancies. But increasing taxes on anyone can come with its own set of problems, such as discouraging work, savings, investment and innovation, or diverting money to less efficient uses. For example, why spend tax dollars on government housing programs when private homebuilders can build homes quicker and more efficiently — if we would just let them?

    Freeing up a few homes for rentals is no doubt desirable, but not if it means interfering with the rights of homeowners who for whatever reason might not want to make their homes available for such use. 

    As for lowering Hawaii’s high home prices, that is the goal least likely to be achieved. I can say that with confidence because the Grassroot Institute issued a report just last month that analyzed neighborhood-level census data for the entire state of Hawaii to see whether there is any meaningful relationship between empty homes and housing prices. We found that there isn’t any. 

    And let’s remember, enforcing a vacant homes tax would not necessarily be easy or cost-free. As I already mentioned, the term “empty home” is arbitrary, and every city that has a vacancy tax has had to create a long list of exemptions to account for cases where there is supposedly a good reason for a home to be empty. 

    In addition, some lawmakers already have recognized that an empty homes tax would be difficult to enforce, requiring more government protocols, paperwork, penalties and, of course, inspectors and other new expensive government employees.

    Supporters of the empty homes tax idea often point to Vancouver in Canada and Oakland in California as examples of how such a tax could benefit Hawaii. 

    Yes, both cities have been successful in generating tax revenues — what politician doesn’t like that? But as far as reducing rental vacancies, it is too soon to tell. Both cities have had the tax for only a few years, and the COVID-19 crisis took place during that period as well, so current statistical conclusions for those jurisdictions are not reliable.

    Other cities with empty homes taxes also have yet to establish that they are effective in addressing vacancies, and no one has been able to demonstrate that such taxes increase housing stock.

    Ultimately, the debate about vacant homes — much like the debate about outside buyers — is a distraction, a misplaced focus on the demand-side of the housing market.

    Until we can let go of these distractions and focus on ways to increase housing supply, Hawaii’s housing crisis will continue.
    _____________

    Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.

    Aloha to Hawaii’s ‘Lone Ranger’

    Grassroot Institute
    -
    0
    Aloha to Hawaii’s ‘Lone Ranger’

    By Keli’i Akina

    It’s a rare man who enters politics and leaves this world mourned as much by his political adversaries as his friends and allies.

    Sam Slom was a rare man.

    A former chief economist at Bank of Hawaii, president of Small Business Hawaii, member of the Grassroot Institute’s board of advisers and epitome of the citizen-legislator, Slom passed away on Sunday at the age of 81.

    To those who knew him only by reputation, Sam’s main claim to fame was as the sole Republican senator in the Hawaii Legislature from 2010 to 2016, which were the last six years of his 20-year tenure representing East Oahu.

    Keli’i Akina

    It was a role he filled with grace and good humor, making light of his solitary status even as he continued to advance principled arguments for fiscal restraint and small government.

    To those who worked with him, Sam was all that and more. In fact, he was the rarest kind of man — one who was exactly what he appeared to be.

    If he came across to you as someone who was fiercely patriotic, yet respectful and welcoming of all views, that’s because he was.

    If you were impressed by his deep intellect, lightened by his strong sense of humor, you were seeing the authentic Sam.

    If you were touched by his generosity and willingness to mentor others, then you knew the side of Sam that believed deeply in sharing and helping those around him.

    Sam was famously accessible to all, and known for treating everyone with respect. During his on-air tribute to Sam on Monday, radio host Rick Hamada noted that anyone who wanted to talk to Sam could go to the Hawaii Kai Safeway or the Koko Head Zippy’s and be sure of getting a meeting. As one caller to Hamada’s show said of Sam, “What a gentleman. What a servant-leader he was.”

    Sam Slom

    Despite being part of the “loyal opposition,” Sam was deeply respected for the way he represented his principles in the Legislature. 

    State Sen. Donna Kim told Hawaii News Now that Sam even persuaded people to change their votes on occasion, adding, “He did bring up really good points, and really, I think, made us think about things.”

    Mayor Rick Blangiardi said of Sam: “Even if you disagreed with him, that’s what you wanted. To have somebody there, somebody who saw the other side of it.”

    Former U.S. Rep. and Hawaii Senate President Colleen Hanabusa, who appeared regularly on a radio program with Sam years ago, reminisced with Hamada about how the three of them could engage in fierce debates, then go out to breakfast and enjoy each other’s company. 

    She remembered Sam saying, “You can disagree without being disagreeable,” and credited him with cherishing diversity as a main reason for America’s greatness.

    Sam may have grown up in Allentown, Pennsylvania, but he reflected the spirit of our islands like few others. In his work, he epitomized the ethos of “E hana kākou” (“Let’s work together”), always finding common ground and ways to work with others, regardless of any differences.

    In his opening remarks at the start of the 2015 Legislature, Sam first drew on his sense of humor. 

    “On behalf of the entire Senate minority: Aloha!” he said. 

    Then he pledged to continue to represent the “loyal but responsible opposition to harmful legislation while advocating reasonable alternative legislation to solve problems and ease the economic burdens on our citizens.”

    He said his job and the job of his fellow legislators was to “restore and encourage the public’s confidence in our process, and to be more transparent and accountable ourselves, while empowering our citizens. We have to do more than just talk or make speeches; we need appropriate action. We can do this.”

    After highlighting many of the problems facing Hawaii — and what he would like to do about them — he again made a pledge:

    “On behalf of the Senate minority, I pledge our continued efforts to support good legislation regardless of who introduces it, to examine and report honestly on the impact of all bills, and to work toward ending legislative exemptions for ourselves for laws we pass on to others.

    “We celebrate our God-given liberty and our ability to change,” he continued. “Our goal should not just be a ‘New Day’ but a ‘Better Day.’ This is not a partisan issue. Together we must navigate a different course with a vision of how much greater Hawaii can be.”

    That was Sam — principled but reasonable, loyal and responsible, a patriot, a defender of liberty and a wonderful friend.

    Aloha ‘oe, Sam. I will miss you. Hawaii will miss you.
    _____________

    Keli‘i Akina is president and CEO of the Grassroot Institute of Hawaii.

    1...212223...2,035Page 22 of 2,035

    Recent

    Most Commented

    Popular

    Contact us