State moves closer
By Pat Omandam, Star-Bulletin
to using tax stamps on
cigarette packsThe state Legislature wants to crack down on the sale of untaxed cigarettes in Hawaii by marking each pack with a stamp to show the tax on it was paid.
Such a system can be ready for the state within 60 days for $29,000, says a representative of a mainland company that provides half the cigarette stamping machines in the United States.
The House is considering a Senate bill that requires the tobacco tax levied on every wholesaler or dealer be paid through the use of stamps or meter impressions, which would be administered by the state Department of Taxation.
With a decline this year in tobacco tax revenue, lawmakers are worried about the increasing amount of bootleg untaxed cigarettes from military bases and elsewhere that are finding its way to local retailers.
They say a single bootleg container shipment of 1,000 cases of cigarettes -- or 600,000 packs -- represents a tax loss of $480,000 to the state.
The cigarette tax, already the highest in the nation, is set to increase from 80 cents a pack to $1 on July 1.
In his committee report on Senate Bill 2727, SD 2, HD 1, House Judiciary Chairman Terrance Tom (D, Kahaluu) believes any further increase in the cigarette tax without a way to ensure the current tax is paid will "ultimately encourage more leakage, bootlegging and the development of a tobacco product black market."
Robert W. Maag, machine division director of the Meyercord Company Revenue Group in Carol Stream, Ill., told Tom and other House lawmakers yesterday the state could control the problem by allowing three or four local distributors to use a tax stamp on all cigarettes arriving into the state.
That way, the tobacco tax would be paid before the packs and cartons ever hit the stores, he said.
Maag said just one of the company's Fuson Cigarette Tax Stamping Systems is capable of labeling each of the 51 million packs of cigarettes that were sold locally last year. He said these high-tech printers, which are comparable to those used to print U.S. currency, could be leased to the state for $4,500 a year.
The state, however, must pay $24,000 for the roll of custom designed, multicolored tax stamps that are heat-fused to individual packs of cigarettes.
The decal itself is extremely difficult to counterfeit, and is handled the same as currency in many states, Maag said.
And if there is counterfeiting, the color or design of the stamp can be changed with little problem, he said.
Maag said the company, which has about 1,000 machines in operation nationwide, would train local police to detect counterfeit packs, and a 1-800 number would be available to report sales of unstamped cigarettes.
Maag added a lag time will be needed to allow the unstamped inventory already on the market to be sold.
Meanwhile, the bill also defers the 20-cent cigarette tax increase to July 1, 1999.
And it makes it a class C felony to sell cigarettes without stamps or meter impressions, with a maximum fine of $100,000 or five years in jail.
The measure is before the House Finance Committee.
Tom told Maag he hopes this will be a "win-win" situation that will bring in additional tax revenue for the state.
Sen. Tam guts
By Keith Kosaki, Star-Bulletin
foreign language, computer bill
in favor of Chinese centerFor Gov. Ben Cayetano's economic revitalization task force, well-educated workers are essential to allow the isles to compete in the global economy.
That's why the task force sponsored a bill that would impose more stringent computer literacy and foreign language education requirements for public-school students.
But the Senate Education Committee has gutted the measure, inserting a stalled bill: appropriating $200,000 for a Chinese historical center.
The bill is now before the Senate Ways and Means Committee, the same panel that last month blocked the appropriation.
Senate Education Committee Co-Chairman Rod Tam (D, Nuuanu), who's of Chinese ancestry, called the task force's proposal "premature." That's why he jettisoned it and inserted the appropriation proposal.
So House Bill 2564, HD 1, SD 1 now reads like Tam's Senate Bill 2107.
The task force's bill would require all eighth-grade students in public schools to be computer-literate by the year 2000 and high school seniors to be proficient in a second language by 2004.
Senate Ways and Means Co-Chairwoman Rosalyn Baker (D, Lahaina) said she doesn't plan to hear Tam's appropriation bill again but will consider it as part of the Senate's budget proposal. The Senate has until Thursday to submit its proposed budget.
The task force bill, however, remains alive. House Education Chairman David Stegmaier (D, Hawaii Kai) inserted it along with other measures approved by the House, into Senate Bill 2625, SD 1, HD 1. That bill originally expanded principals' duties to set school priorities.
"I think it's very, very important that we set ambitious goals for our public-school students and two of the most important are in that bill (HB 2564)," he said.
Tam said he supports the intent of the task force proposal. But he added the bill had no plan to implement it.
He has introduced resolutions requesting the Department of Education and the Board of Education to devise a plan and report back to the Legislature before the 1999 session, Tam said.
Karen Knudsen, Board of Education chairwoman and a member of the economic task force's education working group, believes she knows why the bill was gutted.
Knudsen said it would be difficult to find additional funding for language laboratories and teachers. She, however, also questioned whether there's a pressing need for a Chinese historical center.
Regarding the task force's proposal, Knudsen said: "Philosophically, it was a good idea. But there are more important, pressing educational needs to be funded."
Stegmaier, however, said the private sector has already pledged $10 million for the computer literacy program.
He feels the cost of the language program is "not insurmountable," Stegmaier added.
Currently, only students aiming for the more prestigious Board of Education special recognition diploma need to take foreign language courses.
Regular diploma students don't need foreign language courses to graduate. There are no requirements for computer literacy.
Tam said a Chinese historical center would be a good investment because it would promote Hawaii's multicultural society and serve as an educational tool for all ethnicities. He said the center would be housed at the Chinese Cultural Plaza.
"We're so culture-oriented in Hawaii, but we take it for granted," he said.
Tam said his bill has the strong support of the Chinese community. He later said it would be "even better" if it could be included within the budget.
Business owners seek
By Craig Gima, Star-Bulletin
change in hiring billAs a small-business owner, Sen. Norman Sakamoto says he's tried to give people with criminal records a second chance. But before he offers them a job, Sakamoto (D, Moanalua) says, he needs to know about their past convictions.
"If someone was DUI, we don't want them driving the company vehicle. But we've got to know that," Sakamoto explained.
That's why Sakamoto and other business owners are hoping the Senate Judiciary Committee will change a bill passed by the Human Resources Committee.
The measure would prohibit businesses from considering or even asking about criminal records until a conditional job offer is made.
It would also prohibit consideration of convictions that do not have a "substantial relationship" to the position and which are more than five years old.
Business groups, the state Department of Education and the Department of Human Resources Development testified against the measure at a Judiciary Committee hearing yesterday.
"This law cannot work because it is fundamentally flawed as a concept," said Perry Confalone of the Chamber of Commerce of Hawaii.
"This measure appears to be tied to the philosophy of whose responsibility it is to rehabilitate convicted felons," lobbyist Richard Botti told the committee. "From the employer's point, it is not our responsibility to rehabilitate criminals. That is a social issue that lies with the government."
The Hawaii Paroling Authority testified in favor of the bill.
Administrator Anthony Commendador said that if an offender is gainfully employed and earning a decent wage, he or she would be less likely to reoffend.
"We feel it is a fair bill," he said.
William Hoshijo, executive director of the Hawaii Civil Rights Commission, said the commission is preparing rules to protect against discrimination because of arrest and conviction records.
"The commission urges that this civil rights protection not be repealed on the basis of its unpopularity.
"By definition our civil rights law protects unpopular minorities," he said.
Hoshijo said only about 3 percent of the complaints brought before the commission allege arrest and court record discrimination.
"It's not as big a problem as it is being made out to be," he said.
But Judiciary Co-Chairman Matt Matsunaga (D, Palolo) questioned why convicted criminals should have the same level of protection as those discriminated against because of race, gender, sexual orientation or religion.
"We're trying to put a square peg in a round hole. It doesn't fit in with the other categories," he said.
After the hearing Matsunaga said he would work with the co-chairmen of the Senate Human Resources Committee to try and find a more reasonable solution to allow businesses to consider criminal convictions while not allowing businesses to discriminate.
LEGISLATURE UPDATE
A calendar of tomorrow's hearings -- to be held at the state Capitol, 415 S. Beretania St., unless noted:
HOUSE
Energy and Environmental Protection: Hearing on bills relating to environmental assessments. Decision-making to follow, 9 a.m., Room 312.
SENATE
UPCOMING
