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House and Senate move closer on minimum wage timeline

LIHU‘E — Two years is now the difference between $18 minimum wage bills moving through the Hawai‘i House and Senate.

After both chambers announced support for an $18 minimum wage at the opening of the legislative session, the Senate quickly passed a no-frills minimum wage increase. The measure, Senate Bill 2018, would incrementally increase the minimum wage to $18 by 2026.

Though this bill passed first reading in the House Jan. 30, a couple weeks later, lawmakers rolled out House Bill 2510, a large package featuring several tax credits and a slower timeline for the wage increase, which would not reach $18 until 2030.

HB2510 was amended Thursday to reach $18 by 2028 and was recommended by the Finance Committee. The wage would hit $13 in 2023 and would incrementally increase a dollar a year until 2028.

The hearing featured testimony from progressive organizations favoring the Senate bill’s quicker timeline and from several business organizations who recommended capping the minimum wage at a lower level.

However, some small businesses owners criticized the bill from a progressive perspective.

Business owner Shannon Matson called small business fears about raising the minimum wage “valid, but fear-based.”

“Overall, our small businesses will continue to thrive,” said Matson, who advocated for the Senate bill. “Big businesses, which systemically underpay employees, will continue to meet their bottom lines.”

The Thursday amendments also removed most of the tax credits originally included in the bill, with the exception of the permanent and refundable Earned Income Tax Credit.

“For a family of four with two wage (earners), the maximum Hawai‘i credit would be $1,196,” said Kaua‘i’s North Shore and Eastside Rep. Nadine Nakamura, who was one of the introducers on the bill. “This is an additional cushion for our working families.”

Another feature of the bill that remains is the tip credit, which allows certain industries to pay tipped employees sub-minimum wages.

“I personally don’t believe in the tip credit,” said District 2 Rep. Christopher Todd. “I don’t believe that restaurants and similar industries should be left off the hook.”

Todd ultimately voted in favor of the measure, along with 14 other members of the committee. Three committee members— Rep. Amy Perruso (D-46), Rep. Adrian Tam (D-24), and Rep. Tina Wildberger (D-11) — voiced reservations, but voted in favor. Rep. Bob McDermott (D-40) was excused.

The bill will now go before the full House for a vote.

The Finance Committee also recommended SB2511 appropriating $600 million to the Department of Hawaiian Home Lands, with a companion bill, SB3359, recommended by the Senate Ways and Means Committee.

Of the $600 million appropriated in the Senate bill, $487,614,000 will go toward the preparation and development of 2,910 new lots across the state, while $112,386,000 will be allocated for down payment assistance or mortgage assistance.

The Senate Ways and Means Committee also recommended SB2372, which provides the Hawai‘i Housing Finance and Development Corporation (HHFDC) with $300 million for the Rental Housing Revolving Fund and $10 million for the Dwelling Unit Revolving Fund.

“Recognizing the need to reduce the DHHL waitlist and provide adequate funding for the department to develop new homes, coupled with the lack of real affordable housing options for local residents, it is our hope that these bills will go a long way in getting as many people into homes as possible,” said Senator Donovan Dela Cruz, chair of the Senate Committee on Ways and Means.

The bills will now go in front of the full Senate for a vote.

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Guthrie Scrimgeour, reporter, can be reached at 647-0329 or gscrimgeour@thegardenisland.com.
Source: The Garden Island

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