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Legislators acted
nobly on rail tax

THE ISSUE Governor Lingle dropped her threat to veto the rail transit tax after legislators agreed to assign the tax collection to the counties.

STATE legislative leaders' acquiescence to Governor Lingle's demand that counties, not the state, collect taxes to fund construction of a rail transit system was an historic act of public responsibility. The agreement is portrayed by both sides as a compromise, but this was clearly a staredown that ended when the legislators blinked for all the right reasons.

Mayor Hannemann's effort to achieve the agreement was crucial. His concern about "an Oahu gridlocked in traffic despair" caused him to cut short a tourism-promotion trip to Japan to work toward Lingle dropping her threat to veto the bill allowing counties to trigger general excise tax increases to finance public transportation.

The governor was unwavering in her insistence that revenue from the 0.5 percent increase to the state's 4 percent general excise tax increase be collected by the counties. The bill approved by this year's Legislature provided that the state collect the money, keeping 10 percent of the revenue to be placed in the state's general fund for tax collection costs.

When Lingle protested that the money kept by the state could be spent on non-transit programs, Hannemann proposed that legislators change it to require that the 10 percent be funneled directly to the state Tax Department. Refusing to budge, Lingle said it boiled down to an issue of the counties' power of "home rule."

Cost-efficient methods for the city to collect the estimated $150 million in taxes still must be worked out. The state tax director estimated that the state's cost of collecting the extra tax would cost $13.6 million over the first four years. Hannemann's initial estimate for the city's four-year costs -- duplicating the state system already in place -- would be $52 million.

However, he reported to Lingle in a letter last Friday that he believes it could be "substantially less" than that. "As you know, the devil is in the details and developing a sound, workable plan will take time and effort."

Senate President Robert Bunda and House Speaker Calvin Say agreed to urge the Legislature's next session to change the bill to assign the chore of tax collection to the counties. That will give the city time to develop an economical method to collect the tax.

The governor's decision to allow the bill to become law without her signature angered the conservative wing of her Republican Party. Senate Minority Leader Fred Hemmings called it "a deal with the devil" and Sen. Sam Slom vowed, "It ain't over yet."

Lingle, a moderate, has generally supported the tax increase to fund rail transit on Oahu and transportation projects in other counties from the beginning. GOP conservatives opposed a tax increase for any purpose. The notion that a betrayal has occurred is highly imaginative.

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[ IN MEMORIAM ]

Lawyer David Schutter

FOR years, anybody in Hawaii accused of a major offense and in need of the best criminal defense available was likely to find the way to David Schutter. A brash lawyer who would go to any legal limit to defend his client, Schutter died this week at the age of 64. His legacy will remain among Hawaii's trial lawyers.

A Wisconsin native, Schutter was sent to Hawaii in the late 1960s with the transfer of his National Guard reserve unit in Arizona. After a brief stint in Vietnam, he began practicing law in Honolulu in 1969. In the following decades, he gained prominence as the bulldog attorney for alleged organized-crime figures, murder defendants and, in civil cases, victims of police misconduct.

Former Gov. Ben Cayetano, Schutter's law partner during the 1980s, recalls "his willingness to take big risks and his extraordinary ability to connect with jurors and persuade them to his cause." A defendant cannot ask for more.

Schutter's lawyering was halted in 1997 when he suffered a stroke while at a state courthouse. He defied all medical odds in recovering enough to go to sporting events, movies and restaurants in his final years. He was known to family and friends as warm and generous, a contrast to the bold, often pugnacious and always effective courtroom demeanor for which the public will remember him.

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