TAT fears come true
Maui legislators have warned for years that the Oahu-centric state government was intent on taking away our county’s share of the transient accommodations tax. Tuesday it happened.
By overriding Gov. David Ige’s veto of House Bill 862, state lawmakers eliminated the $103 million of TAT usually distributed to the counties. Maui County’s annual share was around $23.5 million. The override was also a rebuke of the Hawaii Tourism Authority, which suddenly finds itself on shaky footing.
Imagine our surprise when we learned South Maui State Rep. Tina Wildberger helped introduce the bill and that State Sen. Gil Keith-Agaran strongly supported the override. What changed?
Wildberger said Friday she has “mixed feelings” about House Bill 862 and that the issue is “super complicated.” Though her name is on it, she ended up voting against both the bill and the override.
“The bill I signed was a one-page bill about the aerospace industry,” she said, adding that it morphed into something far different late in the legislative process.
“We call it a Franken-bill; it changed significantly after the public had any chance to add input. The part of the bill I did favor was holding HTA accountable for what they are doing with their funding. The part where they take TAT away from the county and keep that money for state business seems, to me, like taxation without representation. I just really feel like it is the State of Oahu.”
Maui County generated more than $200 million in TAT in 2019, according to the state Department of Taxation.
“South and West Maui are treated like cash cows and are inundated without the proper support,” Wildberger said. “And now they are taking the money away.”
She allows that Maui County will probably be able to more than make up for the shortfall by now being able to charge its own TAT — up to 3 percent — but says setting up a system to tap that money will take time.
Keith-Agaran claims Maui County not only stands to gain more revenue by charging its own TAT, it will now have autonomy over how that money is spent.
Mayor Michael Victorino says county officials are considering a 3 percent surcharge that would fund equally: affordable housing, emergency services and visitor education/cultural restoration. It is unlikely the Maui County Council will reject charging the maximum. Some members could see this as a way to help curb overtourism.
Now that the TAT predictions have come true, the results appear to be borne on a growing frustration with Hawaii’s tourism industry. If this is to be our lifeblood, the state Legislature says, why not squeeze a few drops more?
Turning visitor impacts into programs that benefit local residents sounds like a win, but only if done properly. Let’s hope our county can chart an effective and efficient course through these new waters.