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County Revenues

County Revenues

(March Supplement)

The Dec. 1985 Conference of the Hawaii State Association of Counties (HSAC) Intergovernmental Relations Committee findings and suggestions included:

A direct relationship between the allocation of government responsibilities by the State to the Counties and the allocation of State Revenues is needed or there should be delegation of authority to the Counties to raise revenues needed to perform responsibilities assigned to them. Adequate funding of local government and attainment of County home rule are inter-related.

Review is needed of overlapping State and County functions and the distribution of tax revenues and revenue-raising authority between the State and the Counties.

Mayors generally concur that:

  1. Local government will be more responsive and accountable if directly responsible for raising the revenue they will spend.

  2. More effective communication is needed.

  3. Local government accountability is weakened when they are not responsible for raising funds they expend.

  4. County authority to levy a County general excise tax can pro-vide needed revenues which cannot be obtained through real property tax increases because of taxpayer resistance to such increases.

  5. Demands made on the local real property tax base are pervasive and ever-expanding. Included are improvements in infrastructure, improvements and services provided to the visitor industry, and police protection. Also "deep pocket" tort judgments against the counties must be paid from real property tax revenues.

The Jan. and Feb. 1986 "Legislative Tax Bill Service" digests of the Tax Foundation of Hawaii on various bills in the Legislature included:

The tax structure of Hawaii is highly centralized, with the state levying, administering, and collecting almost all taxes with the major exception being the real property tax. This high degree of centralization of revenue collection is matched with the high degree of responsibility for govern-ment functions which is concentrated at the state level. Hawaii's system permits greater efficiency and economy in the administration of the tax law and an integrated statewide tax policy. It also provides for simplicity and uniformity in the application of and compliance with the law.

Proponents of additional county taxing powers point out that the only major source of tax revenues available to the counties for general purposes is the real property tax, therefore, property owners bear an unfair heavy burden of County government costs.

If it is argued that visitors should contribute to the cost of maintaining public services provided by the counties, then they are already doing so through the real property tax. Visitors pay the real property tax, although indirectly, through their hotel room rents as well as through their other purchases.

In the interest of tax equity and revenue stability, the Tax Review Commission's recommendation to impose an additional rate on the rental of transient accommodations cannot be justified.

COUNTY REVENUES - INS AND OUTS

The committee is wrestling with a variety of opinions and stated "facts" prior to finalizing a report and asking all members to participate in consensus.

What do YOU think? Do you KNOW for sure?

  1. Should the City and County of Honolulu be granted autonomy to raise additional revenues by:

    1. Imposition of additional excise or sales tax?

    2. Establishment of a lottery?

    3. Being allowed to use funds collected such as for traffic fines and property conveyances?

    4. Collecting additional "sin" taxes such as on tobacco and alcohol?

  2. Will there be enough revenues in the "general fund" if there is general "earmarking" of specific receipts to designated purposes such as parks, elderly, or highways?

  3. Do you favor "privatization" for services such as collection of rubbish from residences (automated garbage disposal), maintenance and operation of the zoo and parks and recreational facilities, and water for personal use?

  4. Is "pyramiding", whereby the consumer pays a sales or excise tax as "add on" or "cumulative" from manufacturer, wholesaler, and retailer, appropriate?

  5. Would you accept a general increase in property taxes to attain the level of public services needed:

    1. Excluding residential?

    2. Only on hotels and buildings used by visitors?

GETTING THE MOST FOR YOUR MONEY

This was the question asked nationwide: From which level of government do you feel you get the most for your money - federal, state or local?

 

May
1985

May
1984

May
1983

May
1982

Sept.
1981

Federal

32%

24%

31%

35%

30%

Local

31

35

31

28

33

State

22

27

20

20

25

Don't Know

15

14

19

17

14

Since 1972 the Advisory Commission on Intergovernmental Relations has asked the public, "From which level of government do you feel you get the most for your money?" In 1985 the percentage of respondents choosing federal and local governments was about equal: 32% for the federal government and 31% for local government. State government was substantially lower at 22%. High levels of support for local government came from college graduates, the occupational group of professionals, managers, and owners, and households with incomes over $40,000. Neither AGIR nor the Gallup Organization, which does the actual polling, has been able to determine any reason why for the first time in 1984 the federal government was in third place. The highest support for the federal government came from persons in households with incomes below $15,000 and nonwhites according to the patterns apparent in earlier years.
 

If you would like to know more about the $'s going in and out of Honolulu's government, come participate in the committee. Call the office (531-7448) and leave a message expressing your interest and attend committee meetings when possible. (See calendar.)

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