At the start of the 2024 legislative session, lawmakers warned they would face tough decisions while focusing on Maui's recovery and balancing core government functions.
But in the end, they were able to provide funding for Maui, crack down on short-term rentals, cut income taxes and invest in biosecurity measures.
However, when it comes to wildfire mitigation and improving the state’s insurance durability, lawmakers left a lot on the table to hash out in 2025.
“As we started this session, we were so worried that everybody was going to have to make a collective sacrifice to help our ʻohana in Maui because of the devastation of the fires and what we thought would happen to our economic outlook,” said Senate President Ron Kouchi.
“But instead we at least got a flat revenue projection which allowed all of the great things to happen," he continued.
'Largest' tax bill in state history
One of the biggest pieces of policy lawmakers passed was a measure to cut income taxes by about $5 billion over the next six years. It does this by lowering both the base tax and excess percentage charges in each income bracket within three phases.
For example, those who make between $54,000 and $72,000 would get taxed about $3,400, plus about 8% of any income over $54,000.
But starting in 2025, that same income bracket’s base tax would be almost $900 less, plus only about 7% of any income over $54,000.
That taxation drops even further in the next phase of cuts in 2027 and again in 2029.
House Finance Chair Kyle Yamashita explained that this tax cut is a step in the right direction to help lower the cost of living.
“The tax bill that we did pass is the largest in state history,” he said.
“But it's just steps towards what we need to do as far as total tax reform because at the end of the day, our biggest problem in our state is high cost of living and that our tax structure is at the root of that."
Those who will see the largest amount subtracted from their income taxes will be the top 20% of earners, with an average tax cut of about $1,900.
Maui wildfire measures
House Speaker Scott Saiki called this session one of the most historic that the state’s had in recent times. But he expected there to be more conversation about wildfire measures such as one that would have allowed HECO to issue ratepayer-backed bonds for wildfire mitigation.
Saiki also wanted to see more work put into stabilizing property insurance in Hawaiʻi.
“Climate change, disaster risk, hurricane risk have caused property insurance carriers to increase rates or to stop issuing policies in Hawaiʻi,” he said.
“We've seen the initial effects of that within condominium buildings, but it will eventually begin to affect townhouses and single-family homes. So we will have to probably try to address this next year.”
House leadership is also expected to continue to work on marijuana legalization in the 2025 session as well.
Many of the measures that were passed in the last week are awaiting the governor’s approval, including the income tax bill.
Catch up on past stories from HPR's 2024 legislative coverage:
