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Fee increases shake
Council’s resolve
on transit tax

THE ISSUE The City Council has put off a preliminary vote to attach a surcharge to the state's excise tax to pay for mass transit.

Nervous City Council members put off for a month a vote to advance a bill to increase the excise tax on Oahu for mass transit funding, but the delay does not mean the measure is in trouble. Postponement will give the Council and the Hannemann administration time to catch their collective breath and settle differences.

The Council, eager to show support for a large-scale transit project, set the financing wheels in motion as soon as the state Legislature authorized the city to add a surcharge of a half of a percent to the state tax.

The need for speed had been emphasized by Hawaii's congressional delegation as a signal to the federal government, which will provide key funding, that city officials were committed to taking the transit plunge and would not balk, as they did in 1992.

The bill establishes the surcharge, specifies it would be assessed starting in 2007, sets up a special account for revenues and outlines in general how the money will be used, in conformity with the Legislature's intent.

All that's missing is a transit plan.

The Council would be enacting a funding method for something yet to be drafted because the Legislature stipulated it approve the increase by year's end. Critics point to this as one of the reasons to reject the increase, arguing that taxpayers should know what they will be paying for.

Councilman Rod Tam -- ostensibly to acknowledge their concerns -- proposed three conditions to the funding bill, which caused the delay. Tam's demands are that an overall transit plan be completed before the surcharge kicks in, that the Council gets to approve it and that the federal government guarantee its share.

The first two are unnecessary. The administration's timetable dictates it will have a plan ready by then and the Council's approval is prescribed procedure. The third is beyond the city's control.

The delay came on the same day the Council raised sewer, vehicle registration and other city fees significantly. It appears some Council members, feeling the heat from the public, wanted to let matters cool somewhat before moving on the tax increase.

Another issue is that Governor Lingle has yet to sign the authorizing legislation. Lingle has not indicated a veto, but she must notify the Legislature by June 27 of her intentions.

If she rejects the measure, the Council's dilemma will disappear. However, Oahu's traffic problems won't. That will be a far bigger row for the Council to hoe.

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