tax to rise
The 7-1 Council vote will
fund police raises and cost
car owners $30 more per year
Bah-humbug or long-awaited Christmas present: The City Council voted on Christmas Eve to hike the vehicle weight tax to pay for police raises.
With about a dozen uniformed officers and representatives of the police union looking on, the Council voted 7-1 during a special session yesterday to raise the passenger vehicle weight tax to 2 cents a pound from 1.25 cents a pound and the commercial vehicle weight tax to 2.5 cents, a half-cent increase.
Oahu passenger car owners will pay an average $30 more a year as a result of the increase.
"It's a great Christmas gift for our officers," said Tenari Maafala, president of the 2,200-member State of Hawaii Organization of Police Officers. "It's long overdue."
But Councilman Charles Djou, the lone vote against the hike, used another Christmas metaphor to voice his displeasure.
"We are putting a lump of coal into the stockings of all taxpayers with this massive 60 percent increase in the vehicle tax," said Djou, who voted last month in support of the raises.
Councilwoman Barbara Marshall did not attend yesterday's meeting.
The police raises will cost the city $67 million over the four-year contract. The city needs to pay for $5.7 million in raises this year and nearly $13 million next year.
The city now estimates the tax hike will generate about $1 million less than the previous estimate of $6.5 million for the current fiscal year because January car registration renewals have already been mailed under the old tax rate.
"This is within range of being able to pay for all the costs this year," said Mayor Jeremy Harris. "It would have been better for us if it had been approved earlier. It would have allowed us to charge the tax in January, and we would have been a little bit better off."
Harris said that the tax increase will pay for all the raises for this year and next year and a portion of the third and fourth years of the contract.
Harris called the Council into special session after it voted Dec. 3, during its final scheduled meeting of the year, to send the tax proposal back to committee.
City officials said the tax increase can take effect only on Jan. 1 of each year. To do so, it must be approved by the end of the prior year.
"I think they have done the responsible thing in funding the pay raise, so I think today's City Council should be congratulated for doing the right thing," Harris said.
Maafala said that SHOPO representatives met with councilmembers in the weeks leading to yesterday's vote.
"It helped by having the officers here, showing their concern that they're here supporting our cause as far as (the bill) is concerned," Maafala said. "We'd be lying if we say we weren't concerned, and that's the reason why we held various meetings with the various councilmembers."
Harris also said he will honor the wishes of the Council to raise the pay of Police and Fire department middle managers not covered by union agreements as well as deputy attorneys in the Corporation Counsel's office.
The city pegs the cost for the additional raises at $365,000 for the current fiscal year. Harris said the tax increase will not cover the additional raises, "but that's a relatively small amount of money compared to the large police raise, so we'll have to absorb that within the (departments') budgets."
Police Chief Lee Donohue, who attended yesterday's meeting, said the vote to approve funding for the pay raises is a step in the right direction, especially for recruitment.
"It's going to help," said Donohue. "Just like other businesses, you're competing against other cities, and one of the big things they offer is the pay package."
While Djou was the only one voting against the tax increase, other councilmembers expressed consternation at hiking the tax.
Councilman Romy Cachola asked why the tax increase could not be deferred and whether the city could use other sources of funding, like the $10.5 million sale of the city's Block J.
But city Budget Director Ivan Lui-Kwan said the city has a projected budget deficit of $87 million to $106 million.
"There is no extra money," he said.