A proposal currently with the state Senate would drastically increase funding for Hawaii’s public schools. SB 1474 would raise the state’s general excise tax, or GET, by 0.5%. It’s estimated that the increase would generate up to $350 million in revenue annually, with $200 million going to the Department of Education.
This is not the first effort by public education advocates to raise additional funds for the state’s public-school system. Last summer, a heated, state-wide debate erupted over a proposal to increase school funding via an increase in property taxes.
The legislature approved a ballot referendum asking whether or not Hawaii voters supported a special surcharge on property taxes to fund public schools. The State Supreme Court later invalidated that referendum question for being overly vague.
The idea was opposed by all four county mayors and business advocacy groups. On the other side was the state teacher’s union and many parents.
Supporters of the defeated property tax proposal have once again thrown their support behind the bill to increase the GET. Corey Rosenlee, President of the Hawaii State Teachers’ Association told HPR that Hawaii’s public schools are underfunded and its teachers underpaid compared to their national counterparts.
Hawaii teachers are consistently ranked at or near the bottom nationally for compensation, when adjusted for cost of living.
Opponents of the tax increase want to see an audit of the Department of Education, which already receives $1 billion in state funding, before any increase is granted. Tax Foundation of Hawaii President Tom Yamachika told HPR that in similar audits of other state agencies, several hundred thousand dollars of unused funds were identified.
Another criticism of the GET hike is that it places a greater burden on low income earners. Senator Brian Taniguchi, who introduced the proposal, said he also introduced an income-based food tax credit to offset the higher GET.
On Thursday, the powerful Senate Ways and Means Committee deferred action on SB 1474 until Friday at 10:00am. If the bill fails to gain approval from that committee it will be effectively dead until next year.
Update, 10:30a, Friday, March 1st: SB 1474 was passed by the Senate Ways and Means Committee. It will now be sent to the Hosue of Representatives where it will need similar approval.