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Council takes wait-see stance


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POSTED: Wednesday, April 22, 2009

The Honolulu City Council is expected to advance various budget proposals when it meets today, but unlike their counterparts on Maui, Honolulu Council members are not planning to deal with the potential loss of money from the state's hotel room tax.

“;There's time,”; said Council Budget Chairman Nestor Garcia. “;There's no need to hit the panic button just yet.”;

County officials have lobbied against diverting the hotel room tax, a measure that has been proposed to close a $1.8 billion shortfall in the upcoming two-year budget.

On Maui, County Council Budget Chairman Joe Pontanilla is anticipating the loss. He has proposed deleting about $18 million from the budget, saying the county cannot rely on funds from the hotel room tax, known as the transient accommodations tax, or TAT.

Budget proposals on the Big Island and Kauai, like Honolulu, assume the TAT money will remain, but mayors are keeping a close an eye on the Legislature.

“;It's basically reaching into the pockets of Big Island residents and pulling money out,”; said Big Island Mayor Billy Kenoi. “;It's going to impose real hardship on our residents.”;

Meanwhile, House Bill 1744, which diverts TAT money from counties and allows them to create a surcharge to make up the loss of money, has passed the House and Senate in different versions. House and Senate members meet in conference committee today to begin hammering out differences.

The room tax provides about $43 million to Honolulu, $22 million to Maui, $18 million to the Big Island and $15 million to Kauai.

“;I'm not making any contingency plans in the amount of $43 million,”; Garcia said. “;I'm waiting, just watching with a nervous glance across the street. It's a game of chess.”;

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The Associated Press contributed to this report.