Say asks Lingle
to OK tax creditsHe urges her to sign the
hotel-commercial construction measure
House Speaker Calvin Say has made a special appeal to Gov. Linda Lingle to not veto a hotel-commercial construction tax credit bill that would mean millions of dollars in savings for Outrigger Enterprises.
In a letter to Lingle, Say said the bill "deserves to be enacted."
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The bill, passed in the closing days of the 2003 Legislature, gives a credit of 8 percent to hotel and commercial construction in tourist areas. The bill would help Outrigger because the tax credit could be applied to both parts of a proposed $300 million hotel expansion and shopping arcade development in Waikiki.
Say is defending the bill. The commercial portion of the tax credit had been dropped from one version of the conference committee draft and then restored at the last minute.
"I am completely at a loss as to why you and others would be surprised by the inclusion of commercial facilities within the scope of the legislation," Say wrote in a letter to Lingle.
He pointed out that the commercial portion of the proposed tax credit had been included in all except one version of the bill.
But Sen. Donna Kim (D, Kalihi Valley-Halawa), Tourism Committee chairwoman, said one version was key because it was the original agreement between the House and Senate to drop the commercial credit. "I think it was surreptitiously inserted in the floor draft. ... If you read the first conference committee report, it says we are deleting the commercial property," Kim said.
She added that she had told House members that the addition of the commercial tax credit, which could cost the state more than $10 million, was more than the state could afford.
Kim added that she had told House members that Lingle was not likely to approve the bill because it was not in her budget plan.
"The House knew she was wrestling with it, we knew she was wrestling with the whole construction tax credit, and that is why I couldn't understand why they were so adamant about the construction tax credit."
Kim said that by insisting on the commercial tax credit, the House was dooming the bill, even if it passed the Legislature. "I thought: You are going to win the battle but lose the war. If she can't balance this, you are going to lose the whole thing," Kim said.
Lingle repeated her concerns about the tax credit bill yesterday.
"My financial plan didn't include any of these tax credits. I am still inclined to veto it, and they (legislators) were well aware of it," Lingle said.
