Bills are on their way to the governor, and state lawmakers are already looking into the future.
The legislative session wrapped up Friday with lawmakers passing the country’s first Green Fee — a tax on tourists to support the climate.
It raises the state’s tax on hotels by 0.75 of a percentage point to 11%. It also applies that 11% tax on cruise ships docking in Hawaiʻi. Hawaiʻi’s four counties separately each charge a 3% lodging tax.
The bill also includes a provision where the governor will request that the extra tax proceeds go to specific climate resiliency measures. That budget would then need to be approved by the Legislature.
“The passage of this bill is a historic achievement. It honors both the legacy of stewardship here in Hawaiʻi, but creates a new funding source for our climate resilience and natural resource management,” said Jack Kittinger with Care for ʻĀina Now.
The coalition has been advocating for this type of funding for climate resiliency for about seven years.
"It's a great foundation to build from,” he continued. “Of course, our work isn't done here. We have a $560 million per year gap in natural resource stewardship. But this bill is a huge win for our entire state and all of our communities engaged in that work.”
The tax increase is expected to bring in about $80 million to $100 million a year, which is far below the need.
However, Gov. Josh Green explained that the new funds could be leveraged to take out bonds for larger projects, and even encourage other partners to invest in climate work in Hawaiʻi.
“Now that we've demonstrated that the state of Hawaiʻi will be committing $100 million a year as promised, there are a lot of people out there that are interested in matching us dollar for dollar for projects, and I would not be surprised if some of the super wealthy who have settled in Hawai‘i might want to help us,” he said.
“I've had it from the get-go, commitments from groups like Alaska, Hawaiian Airlines, that they would like to help us with these processes. Of course, they've gone through a lot of changes, but they were actually entertaining the idea of a voluntary fee that people could pay to help our environment," Green said. "I expect this will now set off a domino effect of others that will want to support us.”
House Vice Speaker Linda Ichiyama explained that lawmakers have wrestled with different versions of the concept over the years before settling on what they passed.
“We figured the simplest would be to simply increase the existing transient accommodation tax,” she said.
“As a matter of fairness, to make sure that it applied to all types of transient accommodations, not just hotels or B&Bs, but also to cruise ships. And this funding is essential because it's really going to help us steward our natural resources and make sure that they're available for future residents and visitors for many years to come.”
The Green Fee wasn't the only major legislation passed this session
Lawmakers also addressed two clear priorities they set in January: stabilizing property insurance and cracking down on illegal fireworks.
One bill would allow the state to issue commercial and hurricane insurance policies to condominiums that have been unable to obtain coverage.
Another adjusted the illegal fireworks law to make it easier for prosecutors to bring cases. It also elevated some criminal penalties.
Green has until late June to notify lawmakers of his intent to veto any measures. Lawmakers can override his veto with a two-thirds majority.
Meanwhile, House Speaker Nadine Nakamura told reporters that lawmakers will closely monitor federal funding impacts. The budget sets aside $200 million for this purpose, but they would come back for a special session if needed.
“When it comes to the point where we need up to the $200 million set aside, and when both houses, the House and Senate agree, that's when we would convene,” she said.
“So we're going to work very closely with the Green administration, so we have real-time information as the cuts become available. “
Lawmakers have blocked off three dates in August, October and November for a potential special session.
