Council advances proposal to increase hotel room tax to pay for rail, parks maintenance

Published: Oct. 6, 2021 at 5:04 PM HST|Updated: Oct. 6, 2021 at 7:50 PM HST
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HONOLULU (HawaiiNewsNow) - Despite opposition from two of its members, the Honolulu City Council voted Wednesday to advance a hotel room tax increase to help pay for rail and city operations.

Bill 40 increases the hotel room tax on Oahu to cover some of the city’s operating expenses, maintain its parks and beaches and to help pay for the rail.

But some councilmembers and rail skeptics worry that too much money will go to bail out the troubled mass transit project.

“I will be voting no ... I think this is a very dangerous precedent and this cannot be the miracle solution for rail,” said Councilmember Heidi Tsuneyoshi.

Added Natalie Iwasa, a rail critic and member of the board of the Honolulu Authority for Rapid Transportation: “I continue to be concerned about rail. We still have no internal audit function. We have the estimated $3 billion shortfall.”

Honolulu Mayor Rick Blangiardi didn’t say how high he’s willing to raise the transient accommodations tax. The law allows up to a 30% increase over the current tax.

But he did say that city services and maintaining Oahu’s attractions will have a priority over rail.

“Those monies are tied to make sure we can provide services for our local residents first and foremost ― but also not to let the wear and tear of that many visitors take away from the visitor experience,” Blangiardi said.

Bill supporters said the measure doesn’t add additional tax burdens on Oahu residents.

They added that it will help complete the delayed project, help cover what it costs to operate the rail and boost construction activity.

“The rail project is the keystone for the majority of transit-oriented development in Honolulu. Without rail, it makes development in the urban core much harder,” said Pane Meatoga, of the Hawaii Operating Engineers Industry Stabilization Fund.

The bill next goes to the budget committee for further hearings.

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