There is never a good time for tax increases


POSTED: Sunday, March 22, 2009

All across the country people are feeling tapped out. Some say President Barack Obama might not get a second chance to prove to people that he can lead us out of the recession. Here at home, lawmakers also might be vulnerable in the upcoming 2010 elections. Hawaii is experiencing an unprecedented unemployment rate of 6.1 percent, with all sectors showing downward trends in revenue. Property values are plummeting faster than expected while property taxes are expected to rise.

There is definitely a high price to pay for living in paradise today. Taxes, user fees, the high price of health care, food, drugs and gasoline, combined with a shrinking job market all add up to less discretionary spending. We take our lumps and learn to live with less. But there is only so much people can take. There are a number of bills before the Legislature this session that call for tax increases.

Sadly, there are too few bills that have the potential to create new opportunities for economic development and job creation. If legislators insist on spending so much time on nonfiscal debates such as civil unions, fireworks and pit bulls, people might not give them another chance in 2010.

There are two areas the Legislature should be concentrating on.

First is our multimillion-dollar mass transit project already in the works. It is not just about rail. It should be considered an opportunity for major redevelopment of existing communities and infrastructure. There could be much more than construction jobs that are created if we redefine the meaning of mass transit for Oahu's future. It is a golden opportunity to go green. Inventive technology could transform the transit corridor into an environmental showpiece through the use of alternative energy, bike paths and walkways along the proposed rail route. Our current economic crisis practically dictates that the state and city pool their efforts in planning and design as well as land use designations and avoid the current duplication of services.

Second, we need to significantly increase cooperation between the state, our university, the city and the private sector regarding renewable energy policies. There are cries across the country and here at home about the need to be energy independent. Talk is cheap, but alternative energy sources are not. Unless our electric companies can reasonably afford to buy renewable energy from private developers and place it on the grid, independence won't happen any time soon.

This is why I have voted with reservations on all special revenue bonds requested by companies who seek to produce renewable energy. The cost per kilowatt hour is high and the costs will simply be passed on to consumers. But a plan that incorporates Obama's carbon tax plan could reduce the impact on our electric company and the consumer. If we really mean business, we need a timeline that sets specific deadlines for an affordable transition to renewable energy for distribution on Hawaiian Electric Co.'s power grid.

Finally, the Legislature needs to avoid a piecemeal approach to lawmaking that sometimes sends mixed signals to the business community. Hawaii's Superferry fiasco is a perfect example. Our major islands need to stay connected for commerce and communication and family connections. The Legislature should facilitate improvements to interisland transportation systems, not obstruct them.

Our local economy is suffering along with the rest of the country. Those states that will best survive the downturn will find innovative ways to turn adversity into opportunities. Streamlining and modernization of government operations will take more political will than tax increases and the beneficial effect will be longer lasting. Government must live by the same rules as the taxpayers who support it. When the cost of living increases, discretionary spending decreases. When government leaders fail to hear the voice of the people they represent, they are replaced. It really is that simple.


Sen. Robert Bunda, a Democrat, represents the 22nd District (Kaena-Wahiawa-Pupukea).