On Oahu 1,400 establishments hold liquor licenses. The Honolulu Liquor Commission's proposed license fee increase would raise what they pay by 70 percent. It would cost some establishments hundreds of dollars more and other's thousands.
Tiki's Grill & Bar's fee for fiscal year 2018 would jump from $3,900 to $6,700.
"If you're only making ten cents on the dollar, to pay for a fee increase, it really hurts. There will be places that will go out of business," Tiki's director operations Michael Miller said.
But Liquor Commission administrator Don Pacarro said establishments who have already paid their liquor license fees for Fiscal 2018 would pay less than the 70 percent, depending on when the proposal gets passed and how many months are left in the fiscal year.
The Liquor Commission needs to raise about $450,000 to help pay for a new database system and to fund rising operating costs.
"The system is 19 years old. We can't update it. We can't do anything with it. It's outlived it's purpose," commission administrator Don Pacarro said.
He said current fees can't cover the cost.
But the Hawaii Restaurant Association warns if the 70 percent hike goes through customers will feel it.
"The fee has to be absorbed at some level. That's going to be passed on to every consumer that comes into an establishment," chairman Tyler Roukema said.
Cynthia Okazaki of the Hawaii Partnership to Prevent Underage Drinking believes increasing license fees would discourage youngsters from buying alcohol.
"That increase will be passed on to the consumer. For someone who is underage that will make them drink less because of the cost," she said.
Besides bars and restaurants the increase would also apply to liquor wholesalers, manufacturers, retailers and caterers.
"It's not just this one fee," Miller said. "Minimum wage will be going up in January, there's other legislation coming up as well. All these different fees and increases to do business are really going to hurt some of the smaller restaurants."
"You can end up driving away business," Roukema said.
The Liquor Commission argues that the license fee has remained the same for the past twelve years so an increase is warranted.
"It's long overdue. We're being very careful so we look at the numbers and try to do it as fairly as we can," Pacarro said.
Any increase to the liquor license fee needs approval from the City Council. The Honolulu Liquor Commission will hold another public hearing on September 14.
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